May v. TD General Insurance Company, 2025 CanLII 28444

Citation: May v. TD General Insurance Company, 2025 ONLAT 24-010023/AABS-PI

Licence Appeal Tribunal File Number: 24-010023/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:

Seleema May

Applicant

And

TD General Insurance Company

Respondent

PRELIMINARY ISSUE HEARING DECISION AND ORDER

ADJUDICATOR:

Melanie Malach

APPEARANCES:

For the Applicant:

Mehrdad (Michael) Salehi-Moghaddam, Counsel

For the Respondent:

Sina Nastarani, Counsel

Heard:

By Way of Written Submissions

OVERVIEW

1Seleema May, the applicant, was involved in an accident on August 28, 2019, 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, 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 barred from proceeding to a hearing for Non-Earner Benefits (“NEBs”) claimed in her application because she failed to dispute their denial within the 2-year limitation period?

RESULT

3The applicant is statute barred from proceeding to a hearing for NEBs pursuant to s. 56 of the Schedule.

ANALYSIS

Background

4On September 6, 2019, the applicant submitted a Disability Certificate (“OCF-3”). The OCF-3 indicates that she was working at the time of the accident. At Part 6, the OCF-3 indicates that she suffers a substantial inability to perform the essential tasks of her pre-accident and also indicates that she suffers a complete inability to carry on a normal life.

5On September 10, 2019, the applicant submitted an Application for Accident Benefits (“OCF-1”). The applicant indicated that she was employed and working at the time of the accident and that her injuries prevented her from working from August 29, 2019.

6On October 1, 2019, the respondent advised the applicant via correspondence that she qualifies for an Income Replacement Benefits (“IRB”) and therefore, she is not entitled to a NEB. The letter refers to the OCF-3, submitted by the applicant, which indicated that her injuries prevented her from returning to work. The respondent wrote:

Based on the Disability Certificate (OCF-3) your clinician has indicated that you have suffered a complete inability to carry on a normal life as a result of the injuries sustained in the subject loss, however, you qualify for the Income Replacement Benefit and therefore you are not entitled to the Non-Earner Benefit.

7The letter states “Enclosed: Notice to Applicant of Right to Dispute. The letter to the applicant was sent to the same address indicated on the OCF-1 and the OCF-3.

8On October 17, 2019, the respondent advised the applicant via correspondence that based on a conversation with the applicant’s representative, that the applicant had not returned to work since the date of loss and is currently receiving Short-Term Disability Benefits. It states that the applicant’s OCF-3 supports her eligibility to the IRB. The respondent requested further information pursuant to s. 33 of the Schedule to confirm whether there are any amounts owing to her for the IRB. The letter included a notice of right to dispute which stated the applicant had two years from the date of the insurer’s refusal to pay to dispute the determination.

9On July 3, 2024, the applicant filed an application to the Tribunal seeking entitlement to an NEB in the amount of $185.00 per week, from August 28, 2019 to date and ongoing.

10The respondent submits that the October 1, 2019 letter was a clear and unequivocal denial of the NEB, triggering the limitation period, and the applicant did not appeal the denial within two years. Rather, the application was filed almost three years after the limitation period.

11In response, the applicant submits that the respondent did not provide a clear and unequivocal denial, that she never submitted an election form claiming either an IRB or a NEB and that the respondent’s alleged denial did not trigger the limitation period because of its failure to comply with the procedural requirements of the Schedule under sections 32(2)(2)(d), 35 and 36. In the alternative, the applicant submits that I should exercise my discretion under s. 7 of the Licence Appeal Tribunal Act (“LAT Act”) to extend the statutory limitation period.

Did the respondent’s denial trigger the limitation period?

12For the reasons set out below, I find that the respondent issued a valid denial of the NEB that triggered the limitation period.

The Principles of a Proper Denial

13The limitation period for accident benefits claims is set out in s. 56 of the Schedule. It states that applications to dispute the denial of a benefit shall be commenced within two years after the insurer’s refusal to pay the benefit.

14In order for s. 56 to be triggered, the respondent must have provided a valid notice of denial in accordance with the principles set out in Smith v. Co-operators General Insurance Company, 2002 SCC 30 (“Smith”). According to Smith, the refusal to pay the benefit must contain straightforward and clear language, it must be directed towards an unsophisticated person, it must outline the dispute resolution process and the relevant time limits that govern the process, and it must provide valid or other reasons for the denial: see paragraph 14. If an insurer’s notice of a refusal to pay a benefit does not satisfy these requirements, it may be determined to be invalid, and fail to trigger the two-year limitation period under s. 56 of the Schedule.

15The respondent submits that it issued a clear and unequivocal denial of the NEB in its letter dated October 1, 2019, which triggered the limitation period. It points to its letter from that date which provides the following information: the applicant’s injuries prevented her from returning to work and she suffers a substantial inability to perform the essential tasks of her pre-accident employment; she was eligible for an IRB; and she was not entitled to an NEB because she qualified for an IRB. By letter dated October 17, 2019, the respondent confirmed that the applicant’s counsel advised that she had not returned to work since the accident and was currently receiving Short-Term Disability. Section 33 requests were made. The respondent submits that the applicant did not appeal the denial within two years. Rather, this application was filed almost three years after the expiration of the limitation period.

16The applicant submits that the respondent’s letter acknowledged receipt of the applicant’s OCF-1 and OCF-3. As such it was required to pay the specified benefit, give notice of a denial with medical and any other reasons, or send a s.33 request within 10 business days pursuant to s.36(4) of the Schedule. The applicant submits that the respondent failed to meet any of these procedural requirements, including by not providing any medical reasons for the denial of the NEB.

17I find the respondent’s notice letter satisfied the basic requirements of Smith as there was a clear denial of the NEB. The letter sets out its decision that the applicant qualified for an IRB based on the OCF-1 and the OCF-3 submitted by the applicant. The respondent then set out the reasons why the NEB was denied, namely that as she qualifies for an IRB, she is therefore not entitled to a NEB. I find nothing to substantiate the applicant’s argument that the denial was in any way uncertain or ambiguous.

18I find that the refusal to pay the NEB was “clear and unequivocal”, thereby triggering the limitation clock. Had the applicant disagreed with this decision, the applicant had two years from the date of the respondent’s refusal to pay to dispute the determination and file an application to the LAT.

Was an Election of Benefits Form necessary?

19The applicant submits that the respondent’s denial did not trigger the limitation period because the respondent did not comply with the procedural requirements in s. 32(2)(2)(d), s. 35 or s. 36 of the Schedule. The applicant submits that she was not properly informed by the respondent on her ability to elect between a NEB and IRB, despite her OCF-3 indicating that she qualified for both. The applicant submits that the respondent did not provide her any information about the election process as required by s. 32(2)(2)(d) of the Schedule. In addition, the applicant submits that she had yet to make an election at the time of the denial and the respondent did not provide her with the opportunity to elect for a particular specified benefit in accordance with s. 35 of the Schedule. The applicant further submits that her application was incomplete because she did not include a completed Election of Benefits Form (“OCF-10) with her initial OCF-1 and the request for an election of benefits by the respondent is mandatory.

20The respondent submits in its reply submissions that the applicant incorrectly raises procedural arguments in her submissions, relying on sections 32(2)(2)(d), 35 and 36 of the Schedule. The respondent relies upon the Tribunal decisions in M.K. V. TD General insurance Company, 2020 CanLII 30412 (ON LAT) (“M.K.”) and J.G. v. Co-Operators, 2-10 CANLII 110087 (ON LAT) (“J.G.”), where the Tribunal found in each decision that the insured was statute-barred from proceeding with the applications for NEBs, after finding that the insurer had issued a valid denial that triggered the limitation period.

21I find the decisions cited by the respondent in M.K. and J.G., persuasive, in the Tribunal’s finding that an OCF-10 is not required to complete an application. An application for benefits is complete when an OCF-1 and OCF-3 are submitted, and the relevant boxes are checked. On receipt of the OCF-1 and OCF-3 completed by the applicant and her physicians, I find that the respondent was within its rights to decide on eligibility for NEB or IRB based on the information it had available at the time, specifically that the applicant was employed on the date of loss and had been for some time. On receipt of this determination, the applicant would have been free to dispute the determination but did not do so within the limitation period.

22I find that the relevant question is whether the denial notice clearly and unequivocally refused to pay the benefit. Unlike other disputes over the validity of the notices under the Schedule, the focus on a limitations analysis is on whether there was a clear refusal to pay.

23For these reasons, I find that the respondent’s denial notice clearly and unequivocally refused to pay the benefit, thereby triggering the limitation period.

Should the limitation period be extended pursuant to section 7 of the LAT Act?

24I do not exercise my discretion under s. 7 of the LAT Act to extend the statutory limitation period.

25Pursuant to s. 7 of the LAT Act, the Tribunal has the statutory discretion to extend the two-year limitation period in s. 56 of the Schedule if the Tribunal is satisfied that there are reasonable grounds for applying the extension and granting the relief. When considering whether to exercise discretion under s. 7, the Tribunal considers the following four factors set out by the Divisional Court in Manuel v. Registrar, Motor Vehicle Dealers Act, 2022, 2012 ONSC 1492: i) the existence of a bona fide intention to appeal within the appeal period; ii) the length of the delay; iii) the prejudice to the other party; and (iv) the merits of the appeal. These factors are not strict elements that must each be met in order to grant an extension of time, rather a holistic approach must be taken to the analysis. No one factor is determinative. The Court indicated that these factors are subject to the broader rule that an extension should not be granted unless the “justice of the case” requires it. It is the applicant’s onus to establish that there are reasonable grounds for granting an extension.

1. Bona Fide Intention to Appeal within the Appeal Period

26The applicant submits that her intention to appeal within the appeal period is demonstrated by the fact that she believed the appeal period was ongoing until the respondent complied with its obligations under s. 35 and s.36 of the Schedule. The applicant submits that as the respondent has not complied with its procedural obligations to date, the applicant was unaware that any applicable limitation period had begun to run and believed she was appealing within the appeal period.

27I find that the applicant has not provided compelling evidence of a bona fide intention to appeal. While I accept the applicant’s argument that it was her position that the respondent did not comply with its obligations under s. 35 and s. 36 of the Schedule, the applicant has not provided an explanation as to why she did not then appeal immediately, as it would have been well within the limitation period to do so. Instead, she waited almost five years after the denial letter to appeal to the Tribunal.

2. The Length of the Delay

28The applicant submits that there was no delay. She submits that if there was any delay, it was inadvertent as she believed that any limitation period had not begun to run since the respondent had not complied with its obligations under s. 35 and s. 36 of the Schedule. The applicant further submits that the October 1, 2019 letter did not contain “any dispute mechanism and timeframes”.

29I find that the applicant has not provided a compelling explanation for the delay in this matter. The denial letter was sent to the applicant on October 1, 2019 at the same address indicated on the OCF-1 and the OCF-3. I find at the bottom of the October 1, 2019 letter, it indicates “Enclosed: Notice to Applicant of Rights to Dispute”. In the October 17, 2019 letter, the Rights to Dispute are set out in the letter provided to the Tribunal. The applicant commenced her LAT Application on July 3, 2024, significantly beyond the expiration of the limitation period. I find that the applicant has not provided sufficient evidence that the denial was unclear, or that there was any other reason for her delay in applying to the Tribunal.

3. Prejudice to the other party

30The applicant submits that there is no evidence that the respondent would suffer any prejudice by allowing the applicant’s claim to proceed. The applicant submits that there was no clear limitation period since the respondent did not comply with its obligations under the Schedule. The applicant submits there is no limitation period for s. 35 or s.36 violations by the insurer.

31Restricting access to dispute resolution on the merits will almost always have a greater impact on an individual than it will on an insurance company. However, the Divisional Court indicated in Manuel that the decision maker is to focus on the prejudice to the other party, in this case, the respondent insurance company.

32There is also the potential for systemic prejudice to insurers if the Tribunal were to consistently take a broad interpretation of that rule making the limitation period outlined in s. 56 essentially meaningless. An extension of time would undermine the certainty of the limitation period insurers rely on and the respondent would be faced with the burden of defending against an additional claim after several years without medical assessments to address it.

4. Merits of the appeal

33The applicant submits that there is merit to her appeal given the respondent’s failure to comply with its procedural obligations under the Schedule.

34Public interest and legislative intent weigh in favour of giving effect to limitation periods. The applicant has the burden to establish the factors favouring an extension, but she has not directed me to any evidence of special circumstances that would tip the balance of justice in favour of granting the extension. Having considered the evidence before me, I find that the applicant has not met her onus to establish that the justice of this case favours an extension of time to file the application. Accordingly, I decline to use the Tribunal’s discretion to extend the limitation period under section 7 of the LAT Act.

ORDER

35The applicant is statute barred from proceeding to a hearing for NEBs pursuant to s. 56 of the Schedule. The application is dismissed.