Licence Appeal Tribunal File Number: 23-011715/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:
Crache Olivier
Applicant
and
Zenith Insurance Company
Respondent
PRELIMINARY ISSUE HEARING DECISION AND ORDER
ADJUDICATOR:
Brian Norris
APPEARANCES:
For the Applicant:
Adriano Pranzitelli, Counsel
For the Respondent:
Dilenthi Warakaulle, Counsel
Heard:
By Way of Written Submissions
OVERVIEW
1Crache Olivier (the “Applicant”) was involved in an automobile accident on September 15, 2020 and sought benefits from the Zenith Insurance Company (the “Respondent”) 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 and applied to the Licence Appeal Tribunal - Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.
PRELIMINARY ISSUE IN DISPUTE
2The preliminary issue to be decided is:
i. Is the Applicant is barred from proceeding with his claim for benefits as he failed to submit the application for benefits (OCF-1) within the time prescribed by the Schedule, and failed to provide a reasonable explanation for the delay?
RESULT
3The Applicant is permitted to proceed with his claim for benefits.
Post-Submissions Motions
4The Applicant made sur-reply submissions to the Respondent’s reply submissions. The Respondent filed a motion to exclude the submissions because they were not ordered by the Tribunal. In response to the motion, the Applicant submits that it is the adjudicator’s discretion to accept or deny any additional submissions. He further directs me to Rule 3.1 of the Licence Appeal Tribunal Rules (“the Rules”) that provides that the Rules will be liberally interpreted and applied and may be varied. He also submits that his sur-reply was served and filed within 30-40 days of the case conference as directed in the Tribunal’s practice direction on preliminary issue hearings.
5I find that the Applicant’s sur-reply was submitted improperly, and I excluded the document and attachments as a result.
6Indeed, the Case Conference Report and Order sending this matter to a preliminary issue hearing does not provide for the Applicant to make a sur-reply. Accordingly, the Applicant then does not have standing to make sur-reply submissions. A reasonable remedy would be to exclude the submissions entirely because it was never anticipated that they be made.
ANALYSIS
Background
7The Applicant was involved in a motor vehicle accident on July 28, 2021. He notified the Respondent of the accident two days later, but during the call advised the Respondent that he did not intend to pursue a claim for accident benefits. The Respondent wrote to the Applicant that day and confirmed that it was closing its file because of the Applicant’s intention to not pursue a claim.
8On February 1, 2021, about six months following the accident, the Applicant contacted the Respondent and requested that his claim be reopened.
9On March 22, 2021, nearly two months after the call, the Respondent mailed an accident benefits package to the Applicant for completion. The package advised that the Applicant’s “… benefits may be affected if you do not return (the application for benefits) within 30 days of receipt.”
10On April 27, 2022, the Applicant and Respondent spoke on the telephone and the Applicant advised the Respondent that he signed papers with a lawyer to pursue his accident benefits claims.
11By June 5, 2022, the Respondent received a notice from counsel for the Applicant that they were retained to pursue the Applicant’s accident benefits claims. The letter also requested a copy of the Applicant’s property damage and accident benefit files. The letter from counsel for the Applicant was dated April 25, 2022 and states that it was delivered by fax however, the fax confirmation page was not included in the evidence and the adjuster’s log notes document receipt of the letter on June 5, 2022, but having been received May 2, 2022.
12On June 6, 2022, the Respondent advised counsel for the Applicant that it required signed authorization from the Applicant in order to provide any documents. It appears that signed authorizations were delivered to the Respondent later the same day.
13On July 5, 2022 the Respondent provided counsel with a copy of the Applicant’s accident benefit file.
14On July 7, 2022, counsel for the Applicant submitted a completed application for accident benefits through his counsel.
15On July 26, 2022 the Respondent denied the Applicant’s claim for any accident benefits because the Application for benefits was received almost a year following the accident without a reasonable explanation. It also asked that the Applicant participate in an examination under oath (“EuO”) to address the delay. The Applicant complied and an EuO was conducted on November 24, 2022. The Respondent maintained its position following the EuO.
Relevant Legislation
16Section 32(1) of the Schedule provides that a person who intends to apply for one or more benefits in the Schedule must notify the insurer of such an intention no later than the seventh day following an accident.
17Section 32(2) of the Schedule stipulates that the insurer shall promptly provide the person applying for benefits with the 1) appropriate forms 2) a written explanation of the benefits available 3) information to assist the person in applying for benefits and 4) information on the election of a specified benefit.
18Section 32(5) advises that a person applying for benefits shall submit a completed application for accident benefits within 30 days receipt of the forms.
19Section 34 of the Schedule states that if the insured person does not comply with that time limit, the insured person may still be entitled to benefits if they have a reasonable explanation for the delay.
20The interpretation of “reasonable explanation” is outlined in K.H. v. Northbridge, 2019 CanLII 101613 (ON LAT). The guiding principles are summarized as follows:
- An explanation must be determined to be credible or worthy of belief before its reasonableness can be assessed.
- The onus is on the insured person to establish a “reasonable explanation”.
- Ignorance of the law alone is not a “reasonable explanation”.
- The test for “reasonable explanation” is both a subjective and objective test that should take account of both personal characteristics and a “reasonable person” standard.
- The lack of prejudice to the insurer does not make an explanation automatically reasonable.
- An assessment of reasonableness includes a balancing of prejudice to the insurer, hardship to the claimant and whether it is equitable to relieve against the consequences of the failure to comply with the time limit.
Positions
21The Respondent contends that the Applicant failed to comply with the time limits for submitting an application for accident benefits and that he has not given a reasonable explanation for the delayed submission of the application. The Applicant submits that the clock to complete the accident benefits application starts once he receives the forms in accordance with section 32(2) of the Schedule. He highlights that the Respondent delayed providing the accident benefits file and submits that once his counsel received the accident benefit file – and it was discovered that an application for benefits was never submitted – an application for benefits was immediately submitted.
22The Applicant agrees that he did not initially intend to commence a claim because he felt that he would quickly recover from any injuries sustained in the accident. He submits that his condition changed for the worse in the months following the accident and that he had difficulty remembering whether an application for accident benefits was submitted, and that he needed help completing the requisite forms.
The Applicant complied with section 32(1) of the Schedule
23I find that the Applicant complied with section 32(1) of the Schedule when he advised the Respondent of the accident in a timely manner.
24I first highlight that the Applicant called the Respondent within two days of the accident and disclosed the accident in accordance with section 32(1) of the Schedule. I acknowledge that he initially advised the Respondent that he had no intention of claiming accident benefits. However, there is nothing in the Schedule which precludes him from doing so, or from changing his mind – particularly if his situation has deteriorated, as he submits.
25The Applicant continued to act in respect of section 32(1) of the Schedule when he reported a change in circumstances and an intention to initiate a claim. The Applicant advised the Respondent on February 1, 2022 that his situation changed and he intended to initiate a claim. The Applicant tossed the proverbial ball into the Respondent’s court when he called it to relay his intention to claim benefits. Following this, it is incumbent upon the Respondent to comply with section 32(2) of the Schedule.
The Respondent failed to comply with section 32(2) of the Schedule
26I find that the Respondent failed to comply with section 32(2) of the Schedule in two ways: by being untimely; and by failing to outline the consequences for an untimely application for benefits.
27The Respondent failed to promptly provide the Applicant with the accident benefit package (the “AB package”) in accordance with section 32(2) of the Schedule. The Applicant advised the Respondent of his intention to claim accident benefits on February 1, 2022. The AB package was mailed to the Applicant on March 22, 2022. The Respondent took 42 days, or seven weeks, to send the Applicant the AB package. This contradicts section 32(2) of the Schedule whereby the Respondent is required to “promptly” provide the AB package and I fail to see how a seven-week delay is prompt. It is contradictory to hold the Applicant to a strict application of the deadlines in the Schedule at a time where the Respondent has not complied with its own requirements in the Schedule.
28The Respondent failed to provide the Applicant with information to assist him in applying for benefits, pursuant to section 32(2)(c) of the Schedule. The Respondent is obligated to provide the Applicant with information to assist him in applying for benefits but it failed to do so here. By advising the Applicant that “…benefits may be affected if you do not return (the application for benefits) within 30 days of receipt”, the Respondent failed to uphold its obligation to provide information to assist with the application for benefits. Instead, it ought to have advised the Applicant that he will be barred from claiming benefits if he fails to return the application within 30 days, without a reasonable excuse. The Respondent never gave that notice and never provided any other information to assist the Applicant with his application for benefits.
29The Applicant was never told that he would be barred from claiming benefits if he failed to return an application with 30 days of receipt. It is reasonable for him to in turn, fail to consider that he would be barred from claiming benefits entirely due to a delay. The Respondent made no effort to assist the Applicant with his claim beyond sending out the AB package and making a single telephone call and the Respondent was untimely when it sent the AB package to the Applicant as discussed previously. The Respondent made one follow-up telephone call to the Applicant, on April 27, 2022, which is around the 30-day mark to submit the Application. The log notes from that telephone call indicate that the Applicant advised he signed papers with a lawyer – there is no record of any discussion regarding a denial or suspension of benefits due to a delay.
30Having found that the Respondent failed to comply with section 32(2), I must now look at the consequences for the breach.
The clock starts when the Respondent is compliant with section 32(2)
31The result of the Respondent’s failure to provide the requisite information to assist the Applicant with his application for accident benefits is that the 30-day deadline to return the application for benefits is not engaged.
32Section 32(2) of the Schedule must be read in the entire context and grammatical and ordinary sense with the scheme and object of the Act, and the intention of the legislature. Section 32(2) has four conditions that an insurer must satisfy when responding to notice of an accident, as noted previously. A plain reading of the section indicates that only one of the requirements – information on electing a specified benefit – is somewhat optional because it is the only requirement that is followed by “if applicable”. Otherwise, the remaining three provisions: providing the appropriate forms, a written explanation of the benefits available, and the information to assist the person in applying for benefits, remain a requirement.
33Section 32(5) does not trump the mandatory requirements provided in section 32(2). I acknowledge that section 32(5) of the Schedule refers to the receipt of the application forms specifically and does not directly refer to the other conditions of providing the appropriate forms, providing information to assist with the claims process, and a written explanation of the benefits available. However, I find that the Respondent cannot discharge its onus simply by sending the application forms to the Applicant because it would render the other three requirements in section 32(2) moot. It can be assumed that the legislature does not codify legislation superfluously and the mandatory provisions in section 32(2) must be met in order to start the 30-day clock referred to in section 32(5) of the Schedule. it would be unfair to start the clock on the Applicant to submit forms to initiate the claim when the Respondent has failed to comply with its prior obligations.
34Accordingly, I find that the 30-day return clock has not started for the Applicant because the Respondent did not fully comply with section 32(2) of the Schedule.
CONCLUSION AND ORDER
35The Applicant may proceed with his claim for benefits because the Respondent failed to comply with its obligations outlined in section 32(2) of the Schedule.
36The hearing on the substantive issues in dispute will proceed as scheduled.
Released: August 1, 2024
___________________________
Brian Norris
Adjudicator