Hurley v. Co-Operators General Insurance Company, 2025 CanLII 15970

Hurley v. Co-Operators General Insurance Company, 2025 CanLII 15970

Licence Appeal Tribunal File Number: 24-008907/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

Whitney Hurley

Applicant

and

Co-Operators General Insurance Company

Respondent

PRELIMINARY DECISION

VICE-CHAIR: Tyler Moore

APPEARANCES:

For the Applicant: Brandon Petersen, Counsel

For the Respondent: Bruce Keay, Counsel

HEARD: By Way Of Written Submissions

OVERVIEW

1Whitney Hurley, the applicant, was involved in an automobile accident on July 24, 2021, 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, Co-Operators General Insurance Company, and applied to the Licence Appeal Tribunal - Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.

PRELIMINARY ISSUE

2The preliminary issue to be decided is:

i. Is the applicant barred from proceeding with their claim for benefits as they failed to submit the application for benefits (OCF-1) within the time prescribed in the Schedule?

RESULT

3I find that the applicant is barred from proceeding with her application.

PROCEDURAL MATTERS

4On February 12, 2025, the Tribunal requested comment from the parties regarding the recent Divisional Court decision of Hussein v. Intact Insurance Company, 2025 ONSC 842 (“Hussein”), as the decision was released after the preliminary issue hearing submissions deadline. The submissions of the parties have been considered in this decision.

ANALYSIS

Background

5The applicant was involved in an accident on July 24, 2021. The applicant was retrieving an item out of the back seat of her parked vehicle when the door swung back and hit her on the head.

6The applicant applied for accident benefits on April 18, 2023, twenty-one months after the subject accident.

Section 32(1) and (5)

7Section 32(1) of the Schedule requires an insured person to inform an insurer of their intention to claim accident benefits within seven days of the accident, or as soon as practicable after.

8Pursuant to section 32(5) the applicant is required to submit a completed and signed application for benefits to the insurer within 30 days after receiving the application forms.

9Section 34 states that if the insured person does not comply with those time limits, the insured person may still be entitled to benefits if they have a reasonable explanation for the delay.

10Pursuant to section 55(1)1, an insured person may not apply to the Tribunal if they have not notified the insurer of the circumstances giving rise to a benefit or have not submitted an application for the benefit within the times set out in the Schedule.

11The interpretation of “reasonable explanation” is guided by Horvath and Allstate Insurance Company of Canada, FSCO A02-000482, June 9, 2003, and was more recently reiterated in K.H. v. Northbridge, 2019 CanLII 101613 (ON LAT). The guiding principles are summarized as follows:

1. An explanation must be determined to be credible or worthy of belief before its reasonableness can be assessed.
2. The onus is on the insured person to establish a “reasonable explanation”.
3. Ignorance of the law alone is not a “reasonable explanation”.
4. 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.
5. The lack of prejudice to the insurer does not make an explanation automatically reasonable.
6. 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.

12The applicant submits that she was unaware that the incident she was involved in was an “accident” that would permit her to apply for accident benefits because of the atypical circumstances of the incident. The applicant also submits that according to her EUO testimony, the denial of her long-term disability benefits prompted her to speak to a lawyer and subsequently submit an application for accident benefits.

13According to the applicant, the case-law the respondent relies on involves incidents that a reasonable person would consider “typical accidents”, and for which a reasonable person would expect entitlement to accident benefits through an insurer. In the applicant’s case, however, she was involved in an atypical accident where a reasonable person would not know that the circumstances would qualify as an “accident” for the purpose of entitlement to accident benefits.

14The applicant argues that she will endure hardship if she is bound by the time limitations because it would mean that she would be barred from any accident benefits, despite her ongoing symptoms and impairments. The applicant also argues that this hardship would outweigh any prejudice to the respondent because there is nothing the respondent cannot investigate now that could have been investigated before the application was made.

15The respondent submits that the applicant has admitted that there were no physical or psychological reasons that would have prevented her from filling out the paperwork and reporting the claim to the respondent in a timely fashion. The applicant’s only explanation for the lengthy delay in submitting an application for accident benefits was that she was not aware that she could apply.

16The respondent also submits that the applicant’s argument that she did not think she needed to pursue accident benefits until her long-term disability claim was denied is not reasonable, because the applicant’s long-term disability claim was denied in July 2022, but she did not apply for accident benefits until April 18, 2023. According to the respondent, the applicant has not provided any reasonable explanation regarding why she waited until April 2023 to seek legal counsel after she was denied long-term disability benefits.

17The respondent argues that a delay of almost two years in applying for accident benefits has impacted its ability to investigate and assess the claim in a timely fashion.

18Applying the factors set out in Horvath, I find that the applicant has satisfied the relatively low threshold of being credible and worthy of belief. The EUO transcript the applicant submitted provides details of the sequence of events that led up to her application for accident benefits in April 2023.

19While I find the applicant’s explanation credible, I do not find it to be a reasonable explanation. As set out in Horvath, ignorance of the law alone does not constitute a “reasonable explanation” for the purpose of entitlement to accident benefits. I find that the applicant’s evidence is clear that she consulted her representative in April 2023 after her long-term disability benefits were denied in July 2022. It was at that point that she learned that she was made aware that she could apply for accident benefits, almost two years after the accident itself.

20The applicant relies on a body of case-law, including Shaver v. Onlia Insurance Company, 2023 CanLII 58481 (ON LAT) (“Shaver”), Doolitle v. Economical Insurance Company, 2024 CanLII 2657 (ON LAT), and Spencer v. Zenith Insurance Company, 2024 CanLII 108224 (ON LAT), but I find that these cases are distinguishable on the facts. Here the applicant does not suffer from the same mental health or substance abuse issues as in Doolittle, and the adjudicator in that case concluded that despite the applicant’s credibility, their explanation was not reasonable. In Spencer, the accident was also atypical, and the Tribunal found that the applicant did not provide a reasonable explanation for the delay in applying for accident benefits. In Shaver, the applicant was an unsophisticated person with little education. I find that the applicant in this case, however, is a sophisticated person. She has a university education, was employed as a high school teacher, and she has not provided evidence that she was physically or mentally unable to apply for accident benefits at an earlier date.

21The applicant also submits that in Hussein the applicant also delayed applying for accident benefits until he was informed by a paralegal that accident benefits were available to him and failed to submit an application within the time prescribed by the Schedule. The respondent submits that Hussein, and the case-law referenced in that decision, is distinguishable from this case because in those cases the applicant notified the insurer at an early stage of the fact that the applicant had been involved in an accident.

22In Hussein, the insurer initially approved the claim and had the applicant attend a few IEs before terminating benefits. In this case, the applicant did not notify the respondent until 21 months after the accident, and the respondent had no indication of any event or incident involving the applicant until April 2023. For these reasons, I find that Hussein is distinguishable from this case on the facts.

23I have also considered the prejudice to the insurer and the hardship to the applicant in assessing the reasonableness of the applicant’s explanation for the delay. I accept that the respondent has been prejudiced because the application delay has impacted its ability to obtain contemporaneous medical information and conduct relevant investigations and assessments of the claim, particularly with respect to the applicant’s pre-104-week income replacement benefit claim. I also recognize the applicant’s hardship with a finding that she is barred from proceeding with her application. However, I find that these factors are outweighed by the applicant’s ignorance of the law alone.

24For these reasons, I find that the applicant is barred from proceeding with her application because she has not provided a reasonable explanation for the delay in applying for accident benefits.

ORDER

25The applicant is barred from proceeding with her application before the Tribunal under s. 55 as she did not submit an application within the time prescribed in the Schedule.

26The application is dismissed, and the substantive issues written hearing is vacated.