Licence Appeal Tribunal File Number: 25-006918/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:
Karen Whiting
Applicant
and
Co-operators General Insurance Company
Respondent
PRELIMINARY ISSUE DECISION AND ORDER
ADJUDICATOR:
Trina Morissette, Vice-Chair
APPEARANCES:
For the Applicant:
Adam Little, Counsel
For the Respondent:
Daniel M. Himelfarb, Counsel
HEARD:
In writing
OVERVIEW
1Karen Whiting, the applicant, was involved in an automobile accident on July 18, 2021, and sought benefits from Co-operators General 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 (“the Tribunal”) for resolution of the dispute.
PRELIMINARY ISSUE IN DISPUTE
2The preliminary issue to be decided is whether the applicant is barred from proceeding to a hearing of her application because she failed to dispute the denial within the two-year limitation period?
RESULT
3The applicant commenced her application within two years after receipt of the respondent’s denial to pay the post-104 income replacement benefits (“IRB”), and pursuant to section 56 of the Schedule.
4In the alternative, the applicant has established there are reasonable grounds to use the discretion bestowed at section 7 of the Licence Appeal Tribunal Act, 1999, S.O. 1999, c. 12, Sched. G (the “LAT Act”) to extend the limitation period.
ANALYSIS
5Section 56 of the Schedule provides that an application to the Tribunal in respect of a benefit shall be commenced within two years after the respondent’s refusal to pay the amount claimed. However, pursuant to section 7 of the LAT Act, the Tribunal has the authority to extend the limitation period beyond the two-year mark outlined by section 56 of the Schedule.
6The respondent submits that the applicant appealed the denial of the IRB outside the two-year limitation period. It argues that its March 22, 2022 denial clearly and unequivocally terminated IRBs based on the result of an IE assessment. Despite being properly informed of the denial and of her right to dispute the denial, the respondent submits that the applicant nonetheless withdrew an initial application with the Tribunal (Tribunal File Number 24-003461/AABS) and waited more than a year (over three years after the denial) to file her current application. It submits that in the interest of fairness, there must be consequences for her inaction; the limitation period should not be extended.
7The applicant submits that this preliminary issue raises the important question of whether an insured person must dispute an insurer’s denial of an IRB while she is working full-time, earning more than her entitlement threshold, and therefore not eligible for an IRB, in order to protect against the expiry of a limitation period not tenable at the time of the denial. She relies on Personal Insurance Company v. Tagoe, 2024 ONCA 894 (“Tagoe”) and argues that her claim for post-104 week IRBs is not barred by the expiry of a limitation period. In the alternative, the applicant submits the Tribunal should exercise its discretion to extend the limitation period because justice of the case requires it.
8On July 18, 2021, the applicant was a front seat passenger of a truck being driven by her then common law partner when another vehicle turned left directly into their path, causing a collision. The applicant attended the hospital on July 20, 2021, and was diagnosed with a mild traumatic brain injury.
9The applicant submitted an Application for Accident Benefits (OCF-1) dated July 29, 2021. The OCF-1 indicated that the applicant did not return to work as a medical secretary following the accident. The applicant began receiving accident benefits, including an IRB. On August 30, 2021, the applicant returned to modified duties as a medical secretary and began receiving a reduced IRB.
10On February 7, 2022, the respondent advised the applicant by correspondence that based on the information she provided, the IRB would cease as of February 12, 2022. The applicant conceded at the time that her increased earnings from her employment had exceeded her weekly IRB entitlement.
11On March 11, 2022, the applicant attended a section 44 insurer’s examination (IE).
12In an Explanation of Benefit (“EoB”) dated March 22, 2022, the respondent advised the applicant that based on the IE neurological report, she would no longer be receiving “ongoing entitlement to [IRB]” as of March 22, 2022. The respondent explained that, at the time, the applicant reported working 62 hours every two weeks, and the expert found she did “not suffer a substantial inability to perform the essential tasks” of her pre-accident employment. The respondent submits that the March 22, 2022 EoB triggered the two-year limitation period for the applicant to dispute the denial for ongoing IRBs.
13On June 20, 2023, applicant’s counsel advised the respondent that the applicant had received notice that her employment would be terminated because of her decreased level of function caused by her collision-related impairments. On July 31, 2023, the applicant submitted an “updated” OCF-3 to the respondent.
14On July 31, 2023, the respondent advised the applicant through correspondence that it received her OCF-3 and determined that its position in regard to entitlement to IRB “is unchanged from [its] letter of March 22, 2022.” It goes on to state “[w]e continue to deny your entitlement to [IRB] for the medical and any other reasons provided in our letter.”
15In a termination letter dated August 22, 2023, the applicant’s employer stated that the termination would take effect on August 24, 2023.
16Between December 13, 2023 and February 12, 2024, the respondent scheduled, and the applicant attended, four additional IEs in the areas of physiatry, neurology, chiropractic functional ability, and transferable skills and labour market analysis. Upon receipt of the four reports, the respondent sent a letter to the applicant dated March 11, 2024 which stated, in part:
Our position in regard to your eligibility and/or entitlement to [IRB] is unchanged from our letter dated March 22, 2022. It is our position as a result of the accident and within 104 weeks, you do not meet the disability test of suffering a substantial inability to perform the essential tasks of your employment as a medical secretary.
It is our position that you do not meet the disability test of suffering a complete inability to engage in any employment for which you are reasonably suited by education, training, or experience as a result of the accident of July 18, 2021.
We continue to deny entitlement to [IRB] as of March 22, 2022.
17On March 18, 2024, the applicant filed her initial application with the Tribunal under Tribunal File Number 24-003461/AABS. I note that the applicant filed an amended application on March 20, 2024. The issues in dispute included entitlement to IRB, interest and an award. At a case conference held on August 19, 2024 in the matter, and pursuant to the Case Conference Report and Order, the applicant withdrew her application.
18The applicant submits that in preparation for the case conference, she noted that some treatment plans had either not been properly submitted to, or addressed by, the respondent. In email communications between applicant’s counsel and counsel representing the respondent at the time (during the period of August 19-20, 2024), the applicant agreed to withdraw her application “without prejudice”, to await the respondent’s response to the treatment plans, and then to “recommence an application for [IRB] and anything else that may warrant a [Tribunal] hearing.” No tolling agreement was submitted and there is no information that the parties discussed a possible tolling agreement.
19The current application was filed with the Tribunal on May 23, 2025.
The respondent prematurely denied the applicant’s claim for post-104 week IRBs
20The applicant submits that the denial of March 22, 2022 did not start the limitation clock because all parties agreed she was not entitled to an IRB at that time. As such, her right to dispute the respondent’s denial was not discoverable in March 2022 because her right simply did not exist at law. She argues that the respondent’s letter amounted at best to a pre-emptive denial of her pre-104 IRBs (based on the applicant’s submissions I believe she means post-104 IRBs). She argues she could not be reasonably expected to dispute a benefit to which she was not entitled. She submits that the limitation period was triggered, at the earliest, by the respondent’s EoB dated July 31, 2023.
21She argues that the facts in this matter are substantively similar to those in Tagoe in that the parties knew she was ineligible to receive IRBs in March 2022 due to her ongoing full-time employment and substantial earnings. She argues that entitlement to post-104 IRBs was not discoverable until after she was terminated from her employment and, as per the Court of Appeal in Tagoe, “regardless of whether someone had applied for an IRB, it was improper for the insurer to pre-emptively start the limitation clock.”
22Essentially, the applicant is arguing that a denial of pre-104 week IRBs – or more precisely in this case, a stoppage of pre-104 IRBs – does not trigger the limitation period for entitlement to post-104 week IRBs. The applicant submits she was only entitled to post-104 week IRBs when she applied for the benefits with an updated OCF-3 and after receiving notice of her inevitable termination by her employer. Thus, entitlement to post-104 week IRBs was not discoverable before that period and therefore, it is the EoB of July 31, 2023 that would have triggered, at the earliest, the two-year limitation period to dispute the respondent’s denial.
23The respondent submits that the applicant “discovered” her claim for IRBs immediately after the accident and submitted a claim for IRBs at that time. She started receiving IRBs in July 2022 until the benefit was terminated following her return to work and based on a section 44 IE assessment. Essentially, the respondent argues that pre- and post-104 IRBs, being the same benefit, are subject to the same denial which was provided to the applicant on March 22, 2022. This, it argues, was not a pre-emptive denial because the applicant’s entitlement to IRBs was discovered immediately following the accident, and she claimed and received IRBs until they were terminated in March 2022.
24I accept the applicant’s submission that the concept of discoverability, pursuant to Tagoe, applies to a claim for IRB (Tagoe, para. 39). However, as the respondent submits, the facts in Tagoe are distinguishable from the facts here.
25In Tagoe, the issue surrounding the IRB was whether the respondent pre-emptively denied the insured’s entitlement to pre-104 week IRBs before he was eligible for such benefits. Mr. Tagoe had filed an OCF-1 indicating his injuries did not prevent him from working, however, his physiotherapist, who completed and submitted the Disability Certificate (OCF-3), indicated that the insured was substantially unable to perform the essential tasks of his employment but would be able to return to work on modified duties. The physiotherapist added an explanatory note stating that the insured was advised not to work, but because of financial constraints, the insured had returned to work with pain and discomfort.
26The main distinction with Tagoe is that here, the applicant claimed IRBs immediately following the accident and initially received the benefit (pre-104 week IRBs) which were then reduced because of her increased work, and subsequently stopped in March 2022.
27The question before the Tribunal is therefore whether the concept of discoverability applies to an insured’s entitlement to post-104 week IRBs when an insured initially claimed and received pre-104 IRBs, which were then stopped because the insured returned to work. The answer to this question will then guide the Tribunal in determining which EoB triggered the two-year limitation period.
28The respondent puts forward the decision of this Tribunal in 17-007716 v. Pafco Insurance, 2019 CanLII 18324 (ON LAT) (“Pafco”) and argues that an insured person’s temporary return to work does not permit a reset or extension for the limitation period for an IRB. Although I am not bound by this Tribunal decision, I observe that the matter was determined before the Court’s decision in Tagoe and therefore did not benefit from the direction provided by the Court with respect to “discoverability”. I also note that in Pafco, the Tribunal extended the limitation period pursuant to section 7 of the LAT Act. I specifically note the Tribunal’s finding that the settlement agreement the parties entered into was limited to the timeline of the pre-104 week IRBs and “did not cover and hence did not appear to extinguish any and all future claims that [the applicant] might assert to post-104 IRBs” (Pafco, para. 33).
29The applicant also relies on Tomec v. Economical Mutual Insurance Company, 2019 ONCA 882 (“Tomec”) and submits that the Court of Appeal set out two broad principles. The first being that it is absurd to start a limitation period while a person is not entitled to the benefit in question; and second, the Schedule should be interpreted in the context of their broader purpose as remedial and consumer protection legislation. In response, the respondent submits that Tomec is distinguishable because the claim for IRBs does not depend on a change in status or designation that gives the applicant access to enhanced or other benefits which is what occurred in Tomec. I note that the applicant also relies on McLinden v. Payne, 2011 ONCA 439 (“McLinden”) to argue that she faced a substantial change in her entitlement to IRBs when she was terminated from her employment due to her disability more than 104 weeks after the accident.
30Although I agree with the respondent that the facts in Tomec are distinguishable, it is the Court’s discussion and direction regarding “discoverability” that I find relevant and helpful. The Court states that “[d]iscoverability generally provides that a limitation period will not begin to run until the material facts on which the cause of action is based are known to the plaintiff or ought to have been known through the exercise of reasonable diligence” (at para. 27).
31Here, the respondent relies on its EoB of March 22, 2022 and argues that this was a valid denial to a claim for IRBs (pre- and post-104 IRBs). I note that pursuant to section 6 of the Schedule, an insured must demonstrate on a balance of probabilities that they suffer from a complete inability to engage in any employment or self-employment for which they are reasonably suited by education, training, or experience to receive payment for a post-104 week IRB. To be eligible for pre-104 week IRBs, section 5(1) requires that the insured show that they suffer a substantial inability to perform the essential tasks of their employment. Not only does the Schedule establish a different legal test for each, pre- and post- IRBs, it also sets the period of time within which an insured must show that they satisfy the test.
32I agree with the applicant that at the time of the March 22, 2022 EoB, her entitlement to post-104 IRBs had not yet been discovered. The March 22, 2022 EoB was provided nine months (approximately 36 weeks) after the accident. This was a period of time when the applicant was, in no way, eligible for post-104 week IRBs and therefore she could not have known of the material facts on which to claim post-104 week IRBs, nor was she within the period of time to satisfy the legal test set out by the Schedule.
33On this basis, I find that to expect the applicant to dispute a denial for a potential post-104 week IRB claim after approximately 36 weeks following the date of loss – at a time the applicant was not eligible to claim the benefit because she was working and because it was only a year after the accident – would lead “to ridiculous or frivolous consequences” (Tomec, para. 46). I also find that the illogical and inequitable result of this is compounded by the responsibility put on an insured at Part X (sections 57 and 58) of the Schedule. The Schedule requires an insured to take an active role in returning to their pre-accident employment status. Here, the applicant was fulfilling her responsibility pursuant to Part X. She had returned to work, albeit on modified duties, which resulted in her subsequent pre-104 IRB stoppage.
34The Court in Tomec also states that when faced with a choice between an interpretation of the statute “that furthers the public policy objectives underlying the Schedule and one that undermines it, the only reasonable decision is to side with the former.” I agree with the applicant that the Court cautions against how it would be absurd and would place the applicant in a very “impossible situation” if the earlier denial date of March 22, 2022 started the limitation period before post-104 IRBs became discoverable.
35In these circumstances, I find that it would be unreasonable to expect the applicant to dispute her claim for post-104 week IRBs at the time of the March 22, 2022 EoB. The respondent relies on this EoB to show it had denied the applicant’s entitlement to post-104 IRBs, which, in my view, constitutes a premature denial.
The applicant filed her application within the two-year limitation period
36In order for section 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, 2022 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 (at para. 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.
37In June 2023 – which coincides with the end of the pre-104 week period – the applicant was notified of the inevitable termination of her employment. On July 31, 2023, she submitted an “updated” OCF-3. The respondent denied her claim on the same day. The respondent then scheduled four additional section 44 IEs. Upon receipt of the section 44 reports, the respondent provided an EoB to the applicant on March 10, 2024, denying her claim.
38The applicant does not dispute the validity of either the July 31, 2023 EoB or the March 10, 2024 EoB.
39Since the within application was filed with the Tribunal on May 23, 2025, and therefore within the two-year limitation period for both the July 31, 2023 and the March 10, 2024 EoBs, and since the applicant does not dispute that the notices were valid, it is unnecessary to review them in the context of Smith.
40The application was filed within the two-year limitation period.
In any event, there are reasonable grounds to extend the two-year limitation period
41The applicant submits that, in the alternative, the Tribunal should exercise its discretion to extend the limitation period. The respondent submits that if the Tribunal finds the two-year limitation period was missed, an extension should not be allowed.
42Pursuant to section 7 of the LAT Act, the Tribunal has the statutory discretion to extend the two-year limitation period in section 56 of the Schedule if the Tribunal is satisfied that there are reasonable grounds for applying the extension and granting the relief.
43When considering whether to exercise discretion under section 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 14292 (“Manuel”): 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 be met in order to grant an extension of time, and no one factor is determinative. Rather, a holistic approach must be taken to the analysis. 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.
The prejudice to the other party
44The applicant submits that the Court has held that the prejudice to be considered must go beyond the “general institutional need for respect of the rules and deadlines”, contrary to the respondent’s submission that a missed limitation period is inherently prejudicial (Fratarcangeli v. North Blenheim Mutual Insurance Company, 2021 ONSC 3997 (Div. Ct) at para. 81). She argues that the extension of the limitation period will not result in any actual prejudice to the respondent as it had arranged multiple post-104 IEs in 2023-2024. The respondent has had, and will continue to have, full access to her medical records, relevant witnesses will be available to testify and to be cross-examined, and relevant other documentation will be available for the hearing.
45In contrast, the applicant submits that barring her from proceeding with her application would proportionally cause much greater prejudice to her as she will be placed under significant financial pressure given her complete inability to work. She also submits that it was always the parties’ agreement that the issue of IRBs would proceed to a hearing on the merits of her case.
46The Divisional Court in Manuel found that the decision-maker is to focus on the prejudice to the other party, in this case, the respondent insurance company.
47On this point, I find that the respondent would be minimally prejudiced if the limitation period was extended. First, I find that an extension of time would undermine the certainty of the limitation period insurers rely on. However, here, the respondent obtained a neurological IE report in March 2022 which found that the applicant did not suffer a substantial inability to perform the essential tasks of her employment (the pre-104 IRB test). This result was also found in four additional IEs scheduled at the request of the applicant between December 2023 and February 2024. The additional four IE reports also concluded that the applicant did not suffer from a complete inability to engage in any employment for which she is reasonably suited by education, training, or experience (the post-104 IRB test). Therefore, I find that the delay has not hindered the respondent’s ability to obtain necessary assessment reports to evaluate the applicant’s injuries and determine her entitlement to an IRB. As such, I find that granting an extension of the limitation period in this case would be minimally prejudicial to the respondent.
The merits of the appeal
48The applicant submits that her claim has a high likelihood of success. She has been assessed by four section 25 experts who each found the applicant suffered a complete inability to work in any job suited to her education, training, or experience. The applicant submitted the assessment reports of a neurologist (May 9, 2024), a physiatrist (June 25, 2024), a neuropsychologist (July 11, 2024), and a vocational expert (December 12, 2024). These section 25 reports discuss the applicant’s mild traumatic brain injury, her poor prognosis, the severity and duration of her symptoms on both physical and psychological aspects.
49The respondent submits that its IE reports support that the applicant does not meet the test for pre-104 IRBs or post-104 IRBs. It also submits that the section 25 Functional Capacity Evaluation report submitted by the applicant indicates that she was able to work for approximately two years after the accident. As such, the respondent argues that the applicant has not produced evidence that refutes its assessment reports. The respondent adds that the applicant was terminated from her employment in August 2023 and there are no records that indicate she has returned to work since, and no evidence that her absence from the workforce is accident-related and/or are of a quality that would meet the tests. It argues that there is little prospect of success on the merits in the application.
50I find that both parties have obtained assessment reports on the issue of the applicant’s entitlement to IRBs. I also find that the evidence submitted by the parties merit a determination at a hearing. Each party relies on their expert reports to support their position and in my view, it is only through a full and proper analysis of all relevant evidence that the issue can be properly determined.
Summary
51Based on two of the four Manuel factors, the prejudice to the respondent and the merits of the appeal, I find that the applicant has established there are reasonable grounds for granting an extension had I determined the application was filed outside of the two-year limitation period. In my view, the justice of the case requires I use my discretion so that the merits of the case be determined at the substantive issues hearing rather than through a preliminary issues hearing.
ORDER
52For all the above reasons, I find:
i. The applicant commenced her application within two years after receipt of the respondent’s denial to pay post-104 IRBs, and pursuant to section 56 of the Schedule.
ii. In the alternative, the applicant has established there are reasonable grounds to use the discretion bestowed at section 7 of the LAT Act to extend the limitation period.
iii. The application shall proceed to a hearing on the substantive issues as previously scheduled.
Released: February 6, 2026
__________________________
Trina Morissette
Vice-Chair