Licence Appeal Tribunal File Number: 23-012154/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:
BelairDirect Insurance Company
Applicant
and
Anton Sooriyakumar
Respondent
DECISION
ADJUDICATOR:
Laura Goulet
APPEARANCES:
For the Applicant:
Danielle Malone, Counsel
For the Respondent:
No submissions provided
HEARD:
By way of written submissions
OVERVIEW
1This proceeding concerns a dispute between BelairDirect Insurance Company, the applicant, and Anton Sooriyakumar, the respondent, about automobile insurance benefits under the Statutory Accident Benefits Schedule – Effective September 1, 2010 (including amendments effective June 1, 2016) (the “Schedule”) arising from a motor vehicle accident on October 19, 2019. The respondent applied to the Licence Appeal Tribunal – Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.
ISSUES
2The issues in dispute are:
i. Is the applicant (insurer) entitled to a repayment of $41,567.76 relating to its payment of an income replacement benefit for the period of April 20, 2020, to July 11, 2022?
ii. Is the applicant entitled to interest?
iii. Is the applicant entitled to costs?
3In its submissions, the applicant requested costs pursuant to Rule 19 of the Licence Appeal Tribunal Rules, 2023. Accordingly, this issue is included in the issues in dispute set out above.
RESULT
4The applicant is entitled to a repayment of $41,567.76, plus interest.
5The applicant is not entitled to costs.
ANALYSIS
Wilful misrepresentation of material facts
6The applicant has demonstrated that an IRB was paid to the respondent as a result of wilful misrepresentation.
7Section 53 of the Schedule states that an insurer may terminate the payment of benefits to an insured person due to wilful misrepresentation of material facts with respect to their application if the insurer provides the insured with notice setting out the reasons for the termination.
8Section 52(1)(a) states that a person is liable to repay the insurer any benefit that is paid to the person as a result of wilful misrepresentation or fraud.
9The applicant argues that the respondent willfully misrepresented his post-accident income and employment and is seeking repayment of the IRB with interest. The applicant submits that on April 20, 2020, the respondent submitted an OCF-1 dated April 20, 2020, with an OCF-3 dated January 14, 2020, and that he advised that he met the test for an IRB. The OCF-1 indicates that the respondent was employed as “general help” at Legend of Fazio’s (“Fazio’s”). No other employment is listed. The applicant submits that the respondent was paid an IRB in the amount of $41,567.76 for the period of April 13, 2020 to July 11, 2022. In October 2022, the applicant submits that it determined the respondent did not provide his correct employment and income information.
10The applicant refers to the following documents in support of its position:
i. The OCF-2 dated March 6, 2020, which indicates that the respondent had a gross weekly income of $653.24 based on his work at Fazio’s;
ii. The OCF-3 dated January 14, 2020, prepared by Dr. Roy Priesnitz, chiropractor, indicates an inability to complete pre-accident employment due to accident-related injuries;
iii. An undated Initial Contact Questionnaire Information Form indicates that the respondent worked part time as an insurance agent and was on his way to a training event at the time of the accident;
iv. Letters from the applicant to the respondent dated January 20, May 4, and August 12, 2020, with s. 33 requests for further information/documentation to support the IRB claim;
v. An email dated October 1, 2020, from the applicant to the respondent’s prior counsel requesting information about the applicant’s insurance agent employment;
vi. A responding email dated October 14, 2020, from the respondent’s prior counsel indicating that the respondent worked at Fazio’s and questioning why the applicant thought he worked as an insurance agent;
vii. A Statutory Declaration sworn on January 19, 2021, from the respondent stating that he has not been able to return to work at Fazio’s, and denying that he worked as an insurance agent for commissions;
viii. A letter from the applicant to the respondent dated February 11, 2021, confirming that he had been issued payments for an IRB in the amounts of $16,556.76 and $800.00 for the periods of April 20, 2020 to January 31, 2021, and February 1 to February 14, 2021, and that he would continue to receive an IRB in the amount of $400.00 weekly;
ix. A s. 44 report prepared by Dr. Ahmad Belfon dated June 11, 2021, where Dr. Belfon opined that the respondent suffers a substantial inability to perform the essential tasks of his pre-accident employment as a “bar back” at a restaurant;
x. A letter from the applicant to the respondent dated July 14, 2021, confirming continued entitlement to an IRB;
xi. A letter from the applicant to the respondent dated March 3, 2022, requesting income documentation pursuant to s. 33 of the Schedule;
xii. A letter from the applicant to the respondent dated March 25, 2022, advising that the respondent’s IRB is suspended due to non-compliance with s. 33, and a letter dated April 1, 2022 reiterating the s. 33 request;
xiii. A letter from the applicant to the respondent dated July 14, 2022, reiterating the s. 33 request and also requesting documents from Experior Financial Group (“Experior”) and Royal Le Page;
xiv. A letter from the applicant to the respondent dated July 24, 2022, advising the respondent that his IRB was terminated based on multi-disciplinary s. 44 assessments;
xv. An email dated August 2, 2022 from Amanda Way, Senior Compliance Manager at Experior, indicating the respondent was an independent agent contracted to sell financial products. The letter further advised that the respondent was paid commissions from contracted carriers and overrides by Experior, and that Experior does not have record of any commissions paid;
xvi. An email dated September 19, 2022, from Ms. Way to the applicant, with a list of commissions paid to the respondent by Experior from November 2017 to September 2022 totalling $27,389.38. The list does not contain payments issued to the respondent from contracted carriers; and
xvii. A letter from the applicant to the respondent dated October 5, 2022, advising the respondent of the information received from Experior, and that there would be a possible repayment owing.
11The applicant submits that an Examination Under Oath (“EUO”) was scheduled for November 1, 2022, however the respondent’s counsel advised that he was no longer retained. The applicant refers to its email to the respondent dated October 31, 2022 asking that he contact the office within thirty days to advise of new counsel in order to rebook the EUO. The applicant submits that on November 3, 2022, it sent a letter to the respondent indicating that there had been an IRB overpayment that may have occurred because of wilful misrepresentation or fraud.
12The applicant submits that it wrote to the respondent on January 26, 2023 to canvas dates for the EUO but did not receive a response. The applicant further submits that it sent the respondent an email and letter on February 7, 2023, including a Notice of Examination for March 7, 2023 after four personal attempts at service were unsuccessful. The applicant refers to a Certificate of Non-Attendance indicating the respondent did not attend the EUO.
13The applicant refers to a letter dated May 17, 2023 to the respondent confirming an IRB overpayment and that he did not provide documentation to calculate the exact amount. The letter advised the respondent that it is the applicant’s position that in accordance with s. 53 of the Schedule, he wilfully misrepresented the material facts with respect to his application for an IRB for the following reasons:
i. In the OCF-1, the respondent listed his sole source of income as an employee of Fazio’s;
ii. His Statutory Declaration stated that his only source of income was from Fazio’s and that he never worked as an insurance agent; and
iii. The applicant received information from Experior that the respondent was self-employed through Experior from November 2017 to September 2022, and this was not disclosed.
14The May 17, 2023 letter goes on to advise that the applicant is seeking repayment of the IRB and interest in the amount of $41,567.76.
15The respondent did not provide submissions in this hearing.
The respondent wilfully misrepresented his income
16I find that the respondent wilfully misrepresented his income while receiving an IRB.
17The applicant submits that, despite ongoing requests by the applicant for well over two years, the respondent did not disclose his ongoing income post-accident and wilfully misrepresented his income. The applicant further submits that it is entitled to repayment of $41,567.76 for the IRB for the period of April 13, 2020 to July 11, 2022.
18The applicant relies on the decision of 17-000272 v. T.T., 2017 CanLII 87539 (ON LAT), where the Tribunal defined “misrepresentation” as “any manifestation by words or other conduct by one person to another that, under the circumstances, amounts to an assertion not in accordance with the facts.” The Tribunal also held that silence, or a failure to report can constitute wilful misrepresentation.
19The applicant submits that the respondent attested in his January 19, 2021 Statutory Declaration that he did not work as an insurance agent for commissions at the relevant time and that he only worked at Fazio’s. Further, the applicant points out that the OCF-1 fails to disclose any income other than from Fazio’s. The applicant submits that it discovered that the respondent was in receipt of income during the period he also received an IRB, and despite repeated s. 33 requests, the respondent did not provide further information about his income, nor did he attend the EUO.
20The applicant submits that the respondent made a wilful misrepresentation in failing to disclose his correct income. The applicant argues that the Statutory Declaration was shown to be untrue considering the records received from Experior, demonstrating that the respondent was paid over $20,000.00 in commission income which was not disclosed, and there may be additional income paid directly to the respondent.
21The applicant further submits that because the respondent would not disclose his overall income while receiving an IRB, it may not be able to calculate the repayment amount and repayment in full is the appropriate remedy. The applicant refers to the Tribunal decision of Aviva General Insurance Company v. Gurung, (“Gurung”) 2021 CanLII 11858 (ON LAT) with facts similar to this one, where the Tribunal granted repayment of the whole amount of IRBs past the twelve month mark as the insurer proved wilful misrepresentation. The Tribunal held that where the inability to make any determinations regarding the IRB repayment rests solely on the claimant because the information has not been produced, then repayment of the full amount paid may be the appropriate remedy.
22The applicant submits that to date the respondent has not responded to communications, has not filed a response to its application and did not attend the case conference that was held on March 7, 2024.
23In the absence of any submissions from the respondent to the contrary, I find that the respondent did not notify the applicant that he was working for Experior as required under the Schedule, and denied this fact in his sworn Statutory Declaration, while continuing to collect payment of an IRB in the amount of $400.00 per week while no longer being entitled to some or all of it. I find that this amounts to “an assertion not in accordance with the facts.”
24Further, I find that the fact that the respondent did not produce any employment-related information for this hearing or provide evidence to rebut the applicant’s evidence that he was working for Experior from November 2017 to September 2022 is evidence that the IRB was overpaid to him for the period of April 13, 2020 to July 11, 2022.
Notice
25Pursuant to s. 52(1)(a) of the Schedule, a person is liable to repay to the insurer any benefit that is paid to the person because of wilful misrepresentation, provided proper notice is given. Sections 52(2) and (3) provide timelines for repayment notices if a person is liable to repay an amount to the insurer. These sections require an insurer to give the insured person notice of the amount that is required to be repaid within twelve months after the payment of the amount that is to be repaid, unless it was paid to the insured because of wilful misrepresentation or fraud.
26The applicant provided notice of repayment to the respondent that met the substantive criteria outlined in s. 52(2) of the Schedule until May 17, 2023. The May 17, 2023 letter included the type of benefit (an IRB), the payment period for which repayment is sought (the entire payment period), the amount of repayment sought ($41,567.76) and noted that interest may accrue until the full amount was repaid. Accordingly, I find that the applicant’s May 17, 2023 notice complied with all of the procedural requirements for a s. 52 repayment request. Although the notice was well outside of the twelve-month period as provided for in s. 52(3), I find that the twelve-month period does not apply given my finding that the respondent received an overpayment through wilful misrepresentation.
27I find that the applicant is entitled to repayment of the full amount in dispute. Although not binding on me, I agree with the reasoning in the Gurung decision. Given that the respondent did not provide income documentation to the applicant despite repeated requests, and the fact that the list of commissions paid to the respondent by Experior did not contain payments issued to the respondent from contracted carriers, it is not possible to properly calculate the quantum of repayment of the IRB given the deduction of post-accident income the applicant is entitled to make.
28Therefore, I find on a balance of probabilities that the applicant is entitled to a repayment of $41,567.76 relating to its payment of an IRB for the period of April 20, 2020, to July 11, 2022.
Interest
29The applicant also seeks interest in its repayment claim and provided notice in this regard to the respondent in its May 17, 2023 letter.
30Section 52(5) of the Schedule states the insurer may charge interest on the outstanding balance of the amount to be repaid for the period starting on the 15th day after notice is given under subsection (2) and ending on the day repayment is received in full, calculated at the bank rate in effect on the 15th day after the notice under subsection (2) is given.
31Accordingly, as I find the applicant is entitled to a repayment of amounts paid to the respondent as a result of wilful misrepresentation, it follows that interest is payable on any overdue amounts under s. 52(5).
Costs
32The applicant submits that it is entitled to costs in the amount of $1,000.00 under Rule 19 of the Licence Appeal Tribunal Rules. The applicant argues that the respondent’s wilful misrepresentation of his income and post-accident earnings while collecting an IRB was an act of bad faith, and that his failure to respond to correspondence, to participate in the Tribunal proceedings, including failure to file a response to the application and attend the case conference and an EUO has been unreasonable and caused delay.
33I find that the applicant is not entitled to costs for the following reasons.
34Rule 19.1 of the Licence Appeal Tribunal Rules states that where a party believes that another party in a proceeding has acted unreasonably, frivolously, vexatiously or in bad faith, that party may make a request to the Tribunal for costs.
35Rule 19.5 outlines the relevant factors which should be considered by the Tribunal when determining whether to order costs and the amount of costs to be awarded, which include the seriousness of the misconduct, whether the conduct was in breach of a direction or order issued by the Tribunal, whether or not a party's behaviour interfered with the Tribunal's ability to carry out a fair, efficient, and effective process, prejudice to other parties, and the potential impact an order for costs would have on individuals accessing the Tribunal system. Rule 19.6 allows for a maximum of $1,000.00 for each full day of attendance at a motion, case conference or hearing.
36I have considered that the respondent wilfully misrepresented his income while collecting an IRB, which I find to be bad faith, however, the applicant has not pointed to any behaviour in the Tribunal process that amounts to bad faith. Further, the applicant would have had to conduct a hearing in any event to prove its claim for an overpayment. In my view, The Tribunal must consider the totality of a party’s conduct and behaviour in the proceeding and whether it interfered with the Tribunal’s ability to conduct a fair and efficient process.
37Cost awards under Rule 19 are to maintain civility and order during proceedings, to deter conduct that threatens the orderly and civil resolution of an application, and to ensure that the Tribunal’s process and the other participants are respected. They are not to compensate parties for suffering an inconvenience or for the cost of their involvement in a proceeding.
38I find that choosing not to participate in the hearing process is not in itself conduct that threatens the orderly and civil resolution of the application. There must be a course of conduct that frustrates the Tribunal’s ability to carry out a fair and efficient hearing. In the current proceeding, the applicant has not set out how the Tribunal proceeding was impacted because the respondent did not participate.
39I have also considered that a cost award against a self-represented individual, whose strength would not be in drafting written submissions as it would be for a legally trained applicant counsel would have a detrimental impact to those accessing the Tribunal.
40For these reasons, I find that the applicant has not provided sufficient evidence to satisfy Rule 19.1 and its claim for costs is denied.
ORDER
41For the above reasons, I find:
i. The applicant is entitled to a repayment of $41,567.76, plus interest, in accordance with section 52(5) of the Schedule.
ii. The applicant is not entitled to costs.
Released: May 22, 2025
Laura Goulet
Adjudicator