Licence Appeal Tribunal File Number: 21-011784/AABS
In the matter of an Application pursuant to subsection 280(2) of the Insurance Act, RSO 1990, c I.8, in relation to statutory accident benefits.
Between:
Rose Lathan
Applicant
and
TD General Insurance Company
Respondent
PRELIMINARY ISSUE HEARING DECISION AND ORDER
ADJUDICATOR:
Tavlin Kaur
APPEARANCES:
For the Applicant:
David Gardiner, Counsel
For the Respondent:
Andrez Belloso, Counsel
HEARD:
By way of written submissions
OVERVIEW
1Rose Lathan, the applicant, was involved in an incident on August 28, 2017, and sought benefits pursuant to the Statutory Accident Benefits Schedule – Effective September 1, 2010 (including amendments effective June 1, 2016) (the “Schedule”). The applicant was denied benefits by the respondent, TD General Insurance Company (“TD”), and applied to the Licence Appeal Tribunal - Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.
PRELIMINARY ISSUE IN DISPUTE
2The preliminary issues in dispute to be decided are:
i. Is the applicant barred from proceeding to a hearing for the determination of a standalone issue only, of whether or not the applicant’s injuries fall within the Minor Injury Guideline (“MIG”)?
ii. Is the applicant statute-barred from proceeding with her claim for the treatment plan (dated October 19, 2020) due to s. 56 of the Schedule?
iii. Is either party entitled to costs of the preliminary issue hearing for acting unreasonably, frivolously, vexatiously or in bad faith?
RESULT
3The applicant is barred from proceeding with her application.
ANALYSIS
4Section 56 of the Schedule provides that an application to dispute a denial of a benefit shall be commenced within two years of the insurer’s refusal to pay.
5On October 20, 2020, the respondent received a treatment plan (“OCF-18”) in the amount of $1,200.00 from the Chiropractic Care and Longevity Center. On October 21, 2020, the respondent sent the applicant a letter, which informed the applicant that they would only approve $600.00 for the treatment plan, and that an IE would be scheduled to determine whether she suffers from an impairment that comes from within the MIG. The letter informed the applicant of her right to appeal the decision as well as the fact that an insurer examination (“IE”) would be arranged.
6The applicant did not attend the IE on November 30, 2020. The applicant filed her application with the Tribunal on September 11, 2021. She attended the IE on March 7, 2022. In the letter dated March 21, 2022, the respondent maintained their position. It is the respondent’s position that the letter does not restart the limitation period pursuant to section 56.
7The applicant filed a notice of motion dated December 7, 2022 with the Tribunal seeking to add the OCF-18 as an issue in dispute. The motion was heard on December 16, 2022. The Tribunal agreed to add the OCF-18 as well as the preliminary issue as to whether the applicant is barred from proceeding with her claim for the OCF-18 dated October 19, 2020 because she failed to commence her application within two years after the respondent’s refusal to pay the amount claimed.
8The respondent submits that the limitation period to dispute the denial commenced on October 21, 2020. It is the respondent’s position that the letter dated March 21, 2022, does not restart the limitation period pursuant to section 56.
9The applicant submits that that the limitation period for disputing the denial of the OCF-18 would start at the earliest on March 21, 2022 and run for two years until March 21, 2024. She is of the view that she is within the relevant limitation period. She further argues that as “the applicant only received the March 21, 2022 letter on December 5, 2022 so, it is submitted, the limitation period would not start until proper delivery and receipt of such letter. This means the applicable limitation period is really December 5, 2024. However, in the circumstances of this case, the limitation date of March 21, 2024 is still also within the relevant limitation.”
The letter dated October 21, 2020 is valid
10In order for the provision under section 56 to be triggered, the notice of denial must be proper in accordance with the principles set out in Smith v. Co-operators General Insurance Co, 2002 SCC 30 (“Smith”). It is well-established that a notice of refusal to pay benefits must contain clear and straightforward language, must be directed towards an unsophisticated person, must clearly set out the dispute resolution process and the time limit to dispute the denial.
11Further, the notice must provide a valid medical and any other reason for the denial. The Divisional Court in Hedley v. Aviva Insurance Company of Canada, 2019 ONSC 5318 considered the Tribunal’s reconsideration decision of B.H. v. Aviva Insurance Company, 2018 CanLII 84051 (ON LAT), which in turn applied 16-003316/AABS v. Peel Mutual Insurance Company, 2018 CanLII 39373 (ON LAT)(“T.F.”). The Court found no basis to intervene as the decision was within the reasonable range of outcomes.
12The principles were set out by the Tribunal in T.F. in which Executive Chair Lamoureux stated, at para. 19:
[…] an insurer’s “medical and any other reasons” should, at the very least, include specific details about the insured’s condition forming the basis for the insurer’s decision or, alternatively, identify information about the insured’s condition that the insurer does not have but requires. Additionally, an insurer should also refer to the specific benefit or determination at issue, along with any section of the Schedule upon which it relies. Ultimately, an insurer’s “medical and any other reasons” should be clear and sufficient enough to allow an unsophisticated person to make an informed decision to either accept or dispute the decision at issue. Only then will the explanation serve the Schedule’s consumer protection goal.
13If an insurer’s notice of denial to an insured does not satisfy these requirements, the denial may be determined to be invalid and fail to trigger the two-year limitation period.
14In my view, the letter dated October 21, 2020 is quite detailed. Reasons for the denial are provided. References have been made to the applicant’s conditions. The benefits in dispute have been properly identified. I find that the reasons were clear and sufficient to allow an unsophisticated person to make an informed decision to either accept or dispute the decision at issue. As such, I find that this was a clear and unequivocal denial.
15Therefore, the October 21, 2020 denial is a valid denial. As the applicant did not seek to add the OCF-18 in question as an issue in dispute until her Notice of Motion December 7, 2022, I find that she did not dispute the denial within the two year limitation period. While the respondent’s letter dated March 21, 2022 confirmed its refusal to pay for the OCF-18 dated October 19, 2020, this did not restart the limitation period as suggested by the applicant. The respondent had the right to assess the applicant via an IE as part of its duty to adjust the file. The subsequent letter dated March 21, 2022 did not void the original refusal. Moreover, it was clearly and solely tied to the initial refusal. The applicant has not submitted any jurisprudence that supports her position on this point.
16The applicant also alleges that she did not receive the letter dated March 21, 2022 until December 5, 2022. She further claims that the respondent breached section 64 of the Schedule because they sent the letter dated March 21, 2022 along with the IE report from Dr. Safir via regular mail. I am not persuaded by these arguments. Section 64(2) of the Schedule permits the delivery of ordinary or registered mail. Moreover, section 64(18) states that a person is deemed to receive correspondence by ordinary mail on the fifth business day after it was mailed, in the absence of evidence to the contrary. Given that it was the respondent who sent the correspondence to the applicant, the applicant has the burden of putting forward contrary evidence to show that she did not receive it. She has not done that, and submissions are not evidence.
17The next stage of my analysis will consider whether the Tribunal should invoke its discretion under section 7 of the LAT Act.
Section 7 of the LAT Act
18Section 7 of the LAT Act affords the Tribunal statutory discretion to extend the time for commencing a proceeding in certain circumstances if it is satisfied that there are reasonable grounds for applying for the extension and for granting relief. There are four factors that the Tribunal weighs in determining whether the justice of the case requires that an extension be granted:
i. the existence of a bona fide intention to appeal within the appeal period;
ii. the length of the delay;
iii. prejudice to the other party; and
iv. the merits of the appeal.
19These four factors, which are referred to as the “Manuel factors”, are not strict elements that must each be met in order to grant an extension of time, but rather may push or pull differently when analysing whether to extend the limitation period. These factors are a guide to assist in determining whether the justice of the case warrants granting an extension. The onus is on the applicant to satisfy me that the justice of the case favours an extension of the time to file the application.
20The applicant’s submissions did not make any submissions regarding why the Tribunal should exercise its discretion. As such, I find that the applicant did not meet her onus.
The applicant is barred from proceeding to the substantive issue hearing
21Based on my determination, the remaining substantive issues are whether the applicant’s injuries are predominantly minor as defined in section 3 of the Schedule. The respondent submits that the Tribunal does not have the jurisdiction to determine the MIG as a standalone issue. The applicant submits that the Tribunal can proceed with the issue of the MIG as a standalone issue. However, the applicant did not provide any case law to support her position.
22It has been well-established by this Tribunal that the MIG cannot be heard as a standalone issue when there is no medical or rehabilitation benefit in dispute. Based on my findings, there is no longer a benefit tied to the MIG determination. As such, it is ordered that the MIG will not proceed to the substantive issue hearing.
COSTS
23The respondent submits that the applicant is unreasonably and frivolously maintaining her application, which she commenced on the issue of MIG determination despite the Tribunal already ruling on several occasions that it has no jurisdiction to hear the MIG determination as a substantive standalone issue. She neglected to consider appealing any specified benefit until after the resumption of case conference, and she specifically added a benefit that she understood to be out of time, based on the two-year limitation of section 56 and beyond the five-year duration of medical benefit entitlement under section 20(1)(a).
24The applicant submits that there are no grounds to make any award of costs. She is simply doing her best to proceed with this matter in a balanced, fair and efficient fashion.
25I find that the respondent has not met the test set out in Rule 19. While I acknowledge the respondent’s frustration, I am unable to award costs as I find the actions of the applicant is not sufficient to award costs. The test to find bad faith and unreasonable, frivolous, vexatious behaviour is very high. There is no evidence that the applicant’s behaviour has met this threshold.
ORDER
26The application is dismissed.
Released: July 27, 2023
Tavlin Kaur
Adjudicator