Brule v. Intact Insurance Company, 2021 CanLII 79676

Citation: Brule v. Intact Insurance Company, 2021 ONLAT 20-001905/AABS - M

Release date: 08/24/2021

In the matter of an Application for Dispute Resolution pursuant to subsection 280(2) of the Insurance Act, RSO 1990, c I.8., in relation to statutory accident benefits.

Between:

Laura Brule

Applicant

and

Intact Insurance Company

Respondent

MOTION DECISION

ADJUDICATOR:

Samia Makhamra, Adjudicator

APPEARANCES:

For the Applicant:

Gregory C. Gilhooli, Counsel

For the Respondent:

Megan Murphy, Counsel

HEARD:

May 10, 2021 via written submissions

OVERVIEW

1The applicant was injured in an automobile accident on May 23, 2013 and sought benefits from the respondent, Intact Insurance Company (“Intact”), pursuant to the Statutory Accident Benefits Schedule¹ (the “Schedule”).

2Intact paid the applicant income replacement benefits (“IRBs) following the accident but denied the claim on December 12, 2016. The applicant disagreed and applied to the Licence Appeal Tribunal – Automobile Accident Benefits Service (the “Tribunal”) for a resolution.

3The parties participated in a case conference on August 26, 2020. The matter was set down for a 7-day videoconference hearing starting on September 21, 2021. In addition, Intact filed a motion raising a preliminary issue, which is the subject of this decision.

PRELIMINARY ISSUE IN DISPUTE

4The preliminary issue is:

i. Whether the applicant is statute barred from bringing the application to the Tribunal to dispute the IRBs, as they were not disputed within the two-year limitation period, as per s. 56 of the Schedule.

RESULT

5I find that the applicant is not statute barred from proceeding with her claim for IRBs.

BACKGROUND

6Intact paid the applicant IRBs from the date of the accident, May 23, 2013, until December 12, 2016, when it terminated the benefit based on multidisciplinary assessments pursuant to s.44 of the Schedule.

7The applicant filed an application with the Tribunal disputing the denial of the IRBs on December 11, 2018. The Tribunal file for the application is 18-012023/AABS.

8On April 22, 2019, the parties participated in a case conference for 18-012023/AABS. Sometime following the case conference, the applicant decided to seek a catastrophic impairment determination. She had been medically retired since November 2017 and has not returned to work².

9To allow the claim for a catastrophic impairment determination to proceed before the adjudication of the IRBs by the Tribunal, the parties entered into a Standstill Agreement (the “Agreement”).

10Under the Agreement, the applicant agreed to withdraw the Tribunal application 18-012023/AABS and Intact agreed to extend the limitation period for dispute of the IRBs to December 31, 2019, provided an application for a catastrophic impairment determination (“CAT”) was received by August 1, 2019. The parties executed the Agreement on June 19, 2019.

11The applicant withdrew the Tribunal application 18-012023/AABS on June 25, 2019. On July 9, 2019, she submitted an application for Determination of Catastrophic Impairment (an OCF-19) to Intact. However, she did not file an application disputing the IRBs until February 21, 2020, which means she missed the (Agreement) deadline of December 31, 2019.

12The application of February 21, 2020 was assigned number 20-001905/AABS (this the current application). A case conference for 20-001905/AABS took place on August 26, 2020. The parties agreed to add the CAT issue to the application. By then, Intact had completed the s.44 CAT assessments and sent the reports to the applicant on April 9, 2021.

ANALYSIS

13Section 56 of the Schedule states that an application to the Tribunal under s. 280(2) of the Insurance Act “shall be commenced within two years after the insurer’s refusal to pay the amount claimed”.

14The parties agree that more than two years have passed between the denial of the IRBs, on December 12, 2016, and the filing of this application, on February 21, 2021. However, they disagree on whether the Tribunal has jurisdiction to apply s.7 of the License Appeal Tribunal Act, 1999³ (the “LAT Act”) to extend the limitation period, and whether the limitation period should be extended.

15Section 7 of the LAT Act states:

Extension of Time

7. Despite any limitation of time fixed by or under any Act for the giving of any notice requiring a hearing by the Tribunal or an appeal from a decision or order of the Tribunal under section 11 or under any other Act, if the Tribunal is satisfied that there are reasonable grounds for applying the extension and for granting relief, it may:

(a) extend the time for giving the notice either before or after the expiration of the limitation of time so limited; and

(b) give the directions that it considers proper as a result of extending the time.

Does the Tribunal have jurisdiction under section 7 of the LAT Act to extend the limitation period?

16There is now clarity from the Divisional Court on this issue. In Fratarcangeli v. North Blenheim Mutual Insurance Company⁴ (“Fratarcangeli vs North Blenheim”), released on June 15, 2021, the Court affirmed the Tribunal’s jurisdiction to apply s.7 of the LAT Act to extend the limitation period under s.56 of the Schedule.

17Previously, there has been little consensus amongst Tribunal adjudicators on the issue. Some have agreed with the analysis in A.F. v. North Blenheim Mutual Insurance Company⁵ (“AF vs North Blenheim”) in which the Executive Chair, on her own initiative, reconsidered two decisions that had applied s.56 of the Schedule and dismissed the claims as statute barred. The Executive Chair determined that it was a significant error of law for the Tribunal not to consider s.7 of the LAT Act and sent the matters back for a rehearing. In contrast, in a reconsideration decision in S.S. vs. Certas Home and Auto Insurance Company⁶ (“SS vs Certas”), the adjudicator concluded, amongst other details, that the wording “under any Act” in s.7 did not include a “Regulation”, and that s.7 does not apply because the two-year limitation period to appeal a denial is not under an act, as prescribed in s.7, but under a regulation which is the Schedule.

18The applicant’s position is that the Tribunal does have jurisdiction. She relies on AF vs North Blenheim and cites other decisions that followed the same analysis⁷. The respondent disagrees. It submits that the statutory interpretation in SS vs Certas should apply and cites supporting Tribunal decisions⁸.

19The parties’ submissions pre-date the Court decision in Fratarcangeli v. North Blenheim. The Court held that s. 7 of the LAT Act must be read broadly to include limitations fixed by regulations under an Act. The Court concluded that “when s. 7 refers to a time fixed by or under an Act, it is contemplating a time limit fixed by regulation. Section 56 of the SABS contains a time limit fixed “under” the Insurance Act by virtue of the regulation-making power contained in s. 121(1)(26). Thus, the two-year limitation fixed by s.56 of the SABS is a time limit fixed under an Act and is subject to the LAT’s power to extend in s.7” (para. 41).

Should the two-year limitation period be extended under section 7 of the LAT Act?

20To determine whether an extension of the limitation period should be granted under s.7 of the LAT Act, the Tribunal must consider the following four factors⁹:

1. The existence of a bona fide intention to appeal;

2. The length of the delay;

3. Prejudice to the other party; and,

4. The merits of the appeal.

21Importantly, the applicant does not have to satisfy all four factors. They serve as a guide to determine whether the justice of the case warrants an extension.

22I find that the applicant had a clear bona fide intention to appeal the denial. This is clear from her affidavit and from the agreement between the parties. The agreement was entered into for the express purpose of allowing her to refile an application to dispute the post-104-week IRBs. This would permit the Tribunal to hear the IRB issue along with the CAT claim. Finally, she submitted the OCF-19 set by the deadline in the parties’ Agreement.

23The length of the delay was 52 days. In the circumstances of this case, I find that this delay is permissible. I agree with the applicant in that nothing was lost with the delay in filing the current application: the denial of the CAT claim came in April 2021, almost two months after counsel’s office corrected its error and filed this application. Also, based on the submissions and the facts, I accept the explanation that the delay was due to an administrative oversight in counsel’s office¹⁰.

24I find no prejudice to Intact, in particular since Intact did not deny the CAT claim until April 2021. In other words, between the deadline of December 31, 2020 and the filing of the application on February 21, 2021, Intact was obtaining the s.44 CAT reports undisturbed by the fact that the applicant missed the Agreement deadline. Also, the hearing for the substantive issues remains scheduled for September 2021.

25Intact argues that giving the Tribunal the ability to override a deadline removes the certainty that parties come to expect when entering into a Standstill Agreement, such as the one between the parties¹¹. Intact also argues that extending the deadline would create an industry-wide prejudice because it would discourage insurers from entering into agreements and force claimants to proceed to hearings without the benefit of such agreements.

26I do not accept Intact’s submission. Each case is fact-specific and the unique facts of this case - withdrawal of the claim for IRBs so the CAT claim could proceed and both issues could be heard by the Tribunal; submission of the OCF-19 by the Agreement deadline; correction of an error for missing the Agreement deadline while Intact was going ahead with s.44 CAT assessments- favor an extension of the limitation period. Further, the Agreement serves as an extension of a limitation prescribed by the Insurance Act and the Schedule and, therefore, the Tribunal retains jurisdiction to consider a further extension under s. 7 of the LAT Act¹².

27The merits of the case are clear. The underlying benefit in dispute is IRBs. The applicant stopped working in November 2017, when she went on medical retirement, and has not returned to work.

28Lastly, I acknowledge receipt of the applicant’s request of May 7, 2021, to strike the respondent’s reply, because it argued prejudice and jurisdiction, but failed to advance these arguments in its initial submissions supporting the Notice of Motion. In the alternative, the applicant asked for the opportunity to file a sur-reply. I also acknowledge Intact’s response disputing the applicant’s request and asking me not to allow a sur-reply. Given I am finding in favor of the applicant, I do not need to determine whether a sur-reply should be allowed as any unfairness to the applicant is now moot.

29To summarize, based on these reasons, I find the justice of this case warrants an extension of the two-year limitation period.

CONCLUSION AND ORDER

30I find that the applicant is not statute barred from proceeding with her claim for IRBs pursuant to s. 56 of the Schedule.

Footnotes

1. 1Effective September 1, 2010, O. Reg. 34/10.
2. 2Affidavit by the applicant, sworn on April 22, 2021.
3. 3S.O. 1999, c. 12, Sch. G.
4. 4Fratarcangeli v. North Blenheim Mutual Insurance Company, 2021 ONSC 3997 (Div. Ct.).
5. 52017 CanLII 87546 (ON LAT).
6. 62016 CanLII 153125 (ON LAT).
7. 7V.M.L. v. Aviva General Insurance Company, 2019 CanLII 94130 (ON LAT); S.W. v. Aviva General Insurance, 2020 CanLII 12727 (ON LAT); and, R.M. v. Certas Home and Auto Insurance Company, 2020 CanLII 19575 (ON LAT).
8. 8See M.N. v Aviva General Insurance Company, 2019 CanLII 119731 (ON LAT); Landa v. The Dominion of Canada General Insurance Company, 2020 CanLII 87954 (ON LAT); and, R.M. v CAA Insurance, 2020 CanLII 94775 (ON LAT).
9. 9Manuel v. Registrar, Motor Vehicle Dealers Act, 2002, 2012 ONSC 1492 (Div. Ct.).
10. 10Affidavit by Hamis Mill-Mcewan, counsel at McNally Gervan LLP, lawyers for the Applicant, sworn on April 23, 2021.
11. 11Affidavit by Courtney Hancock, Benefit Claims Analyst with Intact, sworn on March 22, 2021.
12. 12Applicant v. Western Assurance Co., 2019 CanLII 101565 (ON LAT), at para 31.