Syed Gilani v. Travelers Insurance Company of Canada, 2022 CanLII 53800

Citation: Gilani v. Travelers Insurance Company of Canada, 2022 ONLAT 19-009248/AABS Licence Appeal Tribunal File Number: 19-009248/AABS

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:

Syed Gilani Applicant

and

Travelers Insurance Company of Canada Respondent

MOTION DECISION

ADJUDICATOR: Craig Mazerolle Motion Decision Dated: June 15, 2022

BACKGROUND

1The applicant was injured in an automobile accident on December 4, 2015, and sought benefits pursuant to the Statutory Accident Benefits Schedule - Effective September 1, 2010 (the "Schedule").

2A videoconference hearing is starting on July 18, 2022.

3The issues in dispute include, in part, catastrophic impairment determination and an award request.

NOTICE OF MOTION

4The applicant filed a Notice of Motion (submitted May 6, 2022) seeking the Licence Appeal Tribunal's (the "Tribunal" or the "LAT") answers to the following questions:

a. Does the applicant's claims against his insurer as a result of its actions taken as part of its adjustment of his claims for accident benefits fall within the interpretation of section 280 of the Insurance Act such that the applicant must pursue his claim at the LAT instead of the courts?

b. Does the applicant's claims for damages against third parties retained by his insurer as a result of their actions taken to the benefit of his insurer as part of its adjustment of his claims for accident benefits fall within the interpretation of section 280 of the Insurance Act such that the applicant must pursue his claim at the LAT instead of the courts?

5These questions arise out of the preliminary issue identified at the case conference held on February 25, 2022:

a. Whether the Tribunal has jurisdiction to determine if the applicant is entitled to the following damages; the tort of intrusion upon seclusion, in the amount of $50,000.00 against Travelers Insurance, Alexandra Mendoza, and Susan Boc-Camara; $50,000.00 against Larrek Investigations and Sulekh Khindria; and $10,000.00 each against Valerie Atbay, Maja Dueroja, Rick Small, Nigel Brebkell, Miroslav Distler and James Winter.

6The respondent opposed the applicant's addition of these claims to the dispute.

PARTIES' POSITIONS

7The applicant submitted that recent case law from the Court of Appeal for Ontario has established that all claims related to accident benefits must be heard by the Tribunal. In light of this broad jurisdiction, the Tribunal must have the ability to grant meaningful remedies to insured persons who are treated improperly by their insurers. In this case, the respondent allegedly subjected the applicant to inappropriate surveillance techniques while assessing his claim for catastrophic impairment and an income replacement benefit. According to the applicant, an award cannot capture this alleged misconduct, i.e., no monetary value is attached to a catastrophic impairment designation and the respondent is paying an income replacement benefit. There can be no right without a remedy, so the tort of intrusion upon seclusion must be available through the Tribunal.

8Further, by raising the principle that only express language can extinguish a common law power, the applicant asserted that torts were not displaced during the transfer of accident benefits disputes from the courts to the Tribunal. Instead, the Court of Appeal's ruling in Stegenga v. Economical Insurance Company ("Stegenga") makes it clear that the Tribunal's jurisdiction over these disputes is "co-extensive" with the courts.¹ Finally, the applicant highlighted the negative impact that the respondent's surveillance practices have had on his well-being, as well as two case management orders from the Tribunal where damages were allowed into the respective proceedings.

9The respondent opposed the motion by submitting that the Tribunal has already ruled on this point, e.g., A.J. v. Security National Insurance Company ("A.J.")². Further, the Court of Appeal used Stegenga to confirm that the Tribunal has different remedial powers from the courts, and that the Legislature allowed this disparity to exist for the purpose of promoting efficiency. Therefore, in line with ss. 280(4) and (6) of the [Insurance Act]³, the respondent argued that the Tribunal can only order a payment outside of the Schedule if a separate regulation specifically allows for it. Finally, the respondent challenged the Tribunal's ability to issue orders against any parties aside from insurers.

10In reply, the applicant disputed the respondent's submission about the interaction between ss. 280(4) and (6) of the Insurance Act. The applicant claimed this interpretation fails to account for the broad powers provided to the Tribunal by virtue of s. 3(2) of the Licence Appeal Tribunal Act, 1999 ("LAT Act")⁴. The applicant also reiterated his alternative form of relief, i.e., the Tribunal should craft an appropriate remedy to address the alleged mischief at hand.

ANALYSIS

11As evidenced by the case law presented by the parties, there has been considerable discussion in recent years about the scope of the Tribunal's relatively newfound jurisdiction over accident benefit disputes: e.g., Yang v. Co-operators General Insurance Company⁵; Wakeling v. Desjardins General Insurance ("Wakeling")⁶; Jarrett v. Aviva Insurance Company of Canada ("Jarrett")⁷, etc. It is now well-accepted that the Tribunal has broad jurisdiction over disagreements involving accident benefits, including the amount and the manner that they are adjusted. Or, as the Court of Appeal summarized in Dorman v. Economical Mutual Insurance Company ("Dorman")⁸:

As the motion judge noted, no court actions are permitted with respect to either disputes about entitlement to SABs or the amount of the SAB. The LAT has exclusive jurisdiction over such disputes. This was confirmed by this court's decision in Stegenga… The plaintiff appellants cannot avoid this result with policy arguments that the exclusive jurisdiction of the LAT undermines the purpose of the Act or hinders access to justice. The Act is clear and must be given effect.

12This "exclusive jurisdiction" derives from s. 280 of the Insurance Act, which provides the Tribunal with the following authority over "disputes in respect of… statutory accident benefits" [subheadings and citations removed]:

(1) This section applies with respect to the resolution of disputes in respect of an insured person's entitlement to statutory accident benefits or in respect of the amount of statutory accident benefits to which an insured person is entitled.

(2) The insured person or the insurer may apply to the Licence Appeal Tribunal to resolve a dispute described in subsection (1).

(3) No person may bring a proceeding in any court with respect to a dispute described in subsection (1), other than an appeal from a decision of the Licence Appeal Tribunal or an application for judicial review.

(4) The dispute shall be resolved in accordance with the Statutory Accident Benefits Schedule.

(5) The regulations may provide for and govern the orders and interim orders that the Licence Appeal Tribunal may make and may provide for and govern the powers and duties that the Licence Appeal Tribunal shall have for the purposes of conducting the proceeding.

(6) Without limiting what else the regulations may provide for and govern, the regulations may provide for and govern the following:

1. Orders, including interim orders, to pay costs, including orders requiring a person representing a party to pay costs personally.

2. Orders, including interim orders, to pay amounts even if those amounts are not costs or amounts to which a party is entitled under the Statutory Accident Benefits Schedule.

13Recent case law has been clear that these provisions provide the Tribunal with broad and exclusive jurisdiction over accident benefit disputes. However, according to the applicant, an open question still remains over what powers and remedies this jurisdiction entails. Specifically, the applicant contended that, since Stegenga found this jurisdiction is "co-extensive with that removed from the court"⁹, all of the court's former common law powers concerning accident benefits must have passed to the Tribunal.

14I do not agree. Instead, I find that—unless specifically listed in the Schedule or a related regulation—any of the common law powers formerly afforded to the courts are not available to the Tribunal. As such, I find the claims that the applicant is attempting to bring against the respondent and others (as defined during the February 25, 2022 case conference) cannot be added to this dispute.

Sections 280(4) and (6) of the Insurance Act

15To start, the following paragraph from Stegenga speaks to the Court of Appeal's conclusion that the Legislature must have been aware of the remedial disparity between the courts and the Tribunal during the jurisdictional transfer [emphasis added]:

In my view this remedial difference does not bear on the issue of what types of disputes are captured by the grant of authority to the LAT and the parallel prohibition on court proceedings. The legislature made a choice as to what disputes would be within the exclusive jurisdiction of the LAT, and what remedial powers the LAT would have. That was a policy choice it was entitled to make. The Insurance Act and its regulations form a comprehensive scheme for the regulation of insurers and insurance. The legislature must be taken to have armed the LAT with the remedial powers it considered appropriate to deal with improper insurer behaviour, knowing those remedial powers were different from the court's.¹⁰

16This paragraph addresses one of the applicant's key arguments, namely, the need for a clear indication from legislators that a common law power is being removed. To summarize the Court of Appeal's reasoning, the Legislature must have known that there was a different, remedial toolbox available to the Tribunal, but it still made the move—a "policy choice it was entitled to make."

17Additionally, as part of this shift, the Legislature created a process for allowing the Tribunal to order payments outside of the Schedule. That is, all accident benefit disputes are to be addressed in accordance with the Schedule (s. 280[4]), unless a regulation is passed allowing for other types of payments (s. 280[6]), e.g., the power to order awards under s. 10 of O. Reg. 664. The Legislature's reliance on these two subsections is a clear indication that it intended to limit remedies to those enumerated in the Schedule and related regulations.

18This statutory route for granting payments outside of the Schedule is especially pertinent in this case because the applicant is attempting to add the tort of intrusion upon seclusion to the proceeding. This tort was first introduced to Ontario law through the Court of Appeal's ruling in Jones v. Tsige.¹¹ Since this case was released in 2012, the Legislature must have been aware of the tort's existence during the jurisdictional transfer of accident benefit disputes in 2016. Yet, despite this presumed knowledge, there has been no corresponding regulation granting the Tribunal the ability to order damages based on this tort.

19The applicant challenged this line of reasoning by citing the Court of Appeal's ruling in Dorman. This case involved, in part, a proposed class action against several insurers over their handling of HST as part of accident benefit claims. This part of the proposed class action was struck by the motion judge, a ruling later upheld on appeal. In my reading of the applicant's submissions, Dorman is used to challenge the need for a separate regulation to order payments outside of the Schedule: "The Court was not deterred in any manner by the Insurance Act or its regulations lack of mention for class-action suits or disputes in relation to the payment of HST out of benefits."

20I do not accept this interpretation of Dorman. There is no need for a regulation stating that accident benefit disputes fall under the Tribunal's jurisdiction—s. 280 of the Insurance Act established this jurisdiction. Rather, the Court of Appeal in Dorman reiterated its conclusions from Stegenga. Put simply, it does not matter how a dispute is defined or presented. If it involves accident benefits, it must go to the Tribunal.

21Similarly, I do not agree with the applicant's reading of Wakeling. This case involved various claims made by an insured person and a former employee of the insured person's accident benefit insurer. Part of the plaintiffs' claims involved allegations of invasion of privacy on the part of the insurer. According to the applicant's submissions, the Court of Appeal "identified that such claims for bad faith are covered by section 280 of the Insurance Act and jurisdiction over same has been transferred from the Courts to this Tribunal." As I interpret it, the applicant's argument appears to be: since claims about bad faith must go to the Tribunal, the Tribunal must have access to the same remedies that the courts used to have.

22This interpretation is not made out in Wakeling. Rather, the Court of Appeal simply stated that s. 280 bars any court proceedings based on accident benefits, because these claims need to be heard by the Tribunal:

An insurer does have a duty to act in good faith in the manner in which it handles a claim… A breach of this duty can support an independent cause of action for damages, including punitive damages at common law, apart from and in addition to entitlement under the contract of insurance. Stegenga…

Even if a claim for bad faith treatment of her accident benefit claim could be pieced together from the appellants' pleadings here, s. 280 of the Insurance Act… is a bar to any such proceedings where accident benefits are in issue. Section 280 bars court proceedings about accident benefits and requires that these be resolved by the Licence Appeal Tribunal. As determined in Stegenga, this includes claims that the insurer acted in bad faith in its treatment of the insured's application for benefits. Stegenga, at para. 6.¹²

Once again, there is no indication that the Court of Appeal is extending the Tribunal's well-established jurisdictional grant under s. 280 to include the courts' former common law remedies.

23Taken together, I am satisfied that the Legislature's intentions behind the interaction of ss. 280(4) and (6) are clear: the Tribunal may only order payments listed in the Schedule or those specifically mentioned in related regulations. There is no regulation adding the tort of intrusion upon seclusion to the Tribunal's remedial toolbox, so the applicant's proposed addition of these claims is not allowed.

Section 3 of the LAT Act

24Turning to his other main argument, the applicant submitted that there is broad discretion afforded to the Tribunal under the LAT Act, specifically s. 3(2): "Except as limited by this Act, the Tribunal has all the powers that are necessary or expedient for carrying out its duties." According to the applicant, s. 280(6) of the Insurance Act must be read in conjunction with this provision, because it allows the Tribunal to exercise powers outside of those provided in the Schedule and related regulations. For instance, the applicant highlighted past orders where the Tribunal has required "applicants not to threaten complaints of professional misconduct" or "to sign consent forms". These powers are not listed in the Schedule, the Insurance Act, or any of its regulations.

25I do not accept this position. Instead, I will endorse my earlier findings from Jarrett. Though this other applicant sought to add punitive damages to a proceeding through ss. 23(1) and 25.0.1 of the Statutory Powers Procedure Act ("SPPA")¹³, I still find this reasoning is applicable to the present request:

The applicant argued that there is broad discretion afforded to this Tribunal under the SPPA, and this authority could be used to order damages. I do not find it is appropriate to use this discretion to ground a remedy as wide-ranging (and potentially impactful) as punitive damages, especially when there is a specific statutory route under s. 280(6).

The discretion afforded under ss. 23(1) and 25.0.1 of the SPPA allows a tribunal to control its own processes and procedures. Therefore, aside from disregarding the Legislature's clear intention on this point, the Tribunal's ability to grant damages would be based solely in the broad language of these general provisions. I do not find this kind of interpretation of the SPPA is merited.¹⁴

26The present applicant is again seeking to base a monetary claim on discretionary language. Such an order would require disregarding one of the Legislature's clear motives in passing s. 280, i.e., to limit payments ordered by the Tribunal to those in the Schedule and related regulations. I find granting this relief would step outside the statutory bounds and discretion provided to the Tribunal, so I will not grant this order.

27I would also note that the decision not to pass a regulation adding common law torts to the Tribunal's available powers is an indication that lawmakers do not believe this form of relief is, in the words of s. 3(2): "necessary or expedient for carrying out [the Tribunal's] duties."

28Finally, aside from costs orders allowed under the SPPA, the examples presented by the applicant of powers that the Tribunal has used in the past (e.g., "to sign consent forms") do not involve monetary payments.

Applicant's Other Arguments

29Turning to his other arguments, the applicant highlighted two case management orders from the Tribunal where adjudicators addressed claims for common law damages: i.e., Tipping v. Coseco Insurance Company¹⁵ and St. Kitts v. Echelon General Insurance Company ("St. Kitts").¹⁶ These orders do not alter my analysis.

30First, both requests to add damages were made on the consent of the parties. The respondent in this dispute opposes the request. Next, at the point in time when these orders were issued, the final, substantive determinations of these issues had yet to be rendered. Finally, the order in St. Kitts only allowed damages to form part of the applicant's application in the lead up to the case conference. As such, the case conference adjudicator still has the ability to weigh in on whether the issue is properly before the Tribunal.

31In closing, the applicant claimed that disallowing torts and similar claims into Tribunal proceedings would "deprive a specific and vulnerable class of Canadian citizens… of their common law and statutory rights". Put another way, since an award cannot address the specific allegations the applicant seeks to make against his insurer and others, the Tribunal must ensure there is a meaningful remedy for injured parties like himself.

32Though I accept that there may be specific allegations and claims that do not fit into the rubric of awards and other forms of relief available at the Tribunal, I am not satisfied that this public policy determination is for me to make. Rather, as Adjudicator Hines observed in A.J. while discussing Stegenga, the Legislature has both the authority and the ability to weigh the consequences of public policy decisions [emphasis in original]:

In my view, I find the Court was clear and consistent in stating throughout its decision the difference between the remedies previously available through the courts compared to those that are available at the Tribunal. While the Court says it in other words, I find that the decision supports that an insured person's right to file bad faith claims for punitive damages is no longer available. Further, that this was a policy choice made by the legislature. In coming to that conclusion, the Court states that the purpose of the legislature's policy decision was to reduce insurance rates and provide for the fast and efficient resolution of disputes and avoid a duplication of processes. Of significance, the Court states that the legislature must have considered "the importance of its objectives of efficiency and cost reduction to outweigh the loss of insured individuals' access to the courts and to the full range of remedies available there."¹⁷

33In a similar vein, I do not find it is appropriate for me to grant the applicant's alternative form of relief. The Legislature has the job of crafting appropriate remedies for the misconduct that applicants allege, while the Tribunal has the responsibility of applying these remedies to specific cases. Reversing these roles would require the Tribunal to step into the realm of public policy considerations—a task best left for legislators.

DISPOSITION

34The claims that the applicant is attempting to bring against the respondent and others (as defined in the preliminary issue from the February 25, 2022 case conference) cannot be added to this dispute.

35The applicant's alternative form of relief is also denied.

Footnotes

1. 12019 ONCA 615, at para. 46.
2. 22021 CanLII 35586 (ON LAT) – upheld on reconsideration.
3. 3R.S.O. 1990, c. I.8.
4. 4S.O. 1999, c. 12, Sch. G.
5. 52022 ONCA 178.
6. 62021 ONCA 672.
7. 72022 CanLII 2762 (ON LAT).
8. 82021 ONCA 314, at para. 8.
9. 9Stegenga, at para. 46.
10. 10Ibid., at para. 52.
11. 112012 ONCA 32.
12. 12Wakeling, at paras. 42 and 44.
13. 13R.S.O. 1990, c. S.22.
14. 14Jarrett, at paras. 18 and 19.
15. 15Case Conference Report and Order, released August 31, 2021.
16. 16Motion Order, released April 28, 2022.
17. 17A.J., at para. 53.