Citation: Borrelli v. Definity Insurance Company, 2026 ONLAT 25-009960/AABS - PI

Licence Appeal Tribunal File Number: 25-009960/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:

Olivia Borrelli

Applicant

and

Definity Insurance Company

Respondent

PRELIMINARY ISSUE DECISION AND ORDER

ADJUDICATOR:

Trina Morissette, Vice-Chair

APPEARANCES:

For the Applicant:

Alison A. Delgado, Counsel

For the Respondent:

Joshua Vickery, Counsel

HEARD:

In writing

OVERVIEW

1Olivia Borrelli, the applicant, was involved in an accident on January 21, 2023, and sought benefits from Definity 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 Case Conference Report and Order dated December 11, 2025, identifies the preliminary issue as:

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

3The parties’ submissions on this preliminary issue address the applicant’s failure to notify the respondent of her intention to claim accident benefits pursuant to section 32(1) of the Schedule. The facts in this matter, which are not in dispute, support that the applicant did not notify the respondent of the accident and of her intention to claim accident benefits until she submitted her OCF-1 to the respondent on August 16, 2024.

4Neither party filed a motion to amend the preliminary issue. Based on both parties’ submissions, I accept that it was the parties’ understanding that the preliminary issue to be decided is in relation to the notification requirement of section 32 of the Schedule, rather than the submission of her application (section 32(5)).

RESULT

5The applicant did not notify the respondent of the incident within the timeline prescribed by the Schedule and has not provided a reasonable explanation for the delay.

6The applicant is barred by section 55(1) from proceeding with her application before the Tribunal.

ANALYSIS

7On January 21, 2023, the applicant was crossing the street at an intersection when she was struck by a right-turning vehicle. At an Examination Under Oath (“EUO”) held December 17, 2024, the applicant testified that she “went flying across the street”, “banged [her] head on the concrete, and banged [her] body”, causing her to become unconscious for “under a minute”. She got back up quickly, was in shock and felt embarrassed, and went on with her plans for the day. As soon as the shock wore off, she attended the hospital.

8She further testified that the driver exchanged contact information with her, and in the days that followed, the driver contacted her and offered to settle the matter without legal action. He initially offered her $1,000.00. At the end of March 2023, she testified that, accompanied by her father, she met with the driver at Tim Horton’s where she accepted $3,000.00 and signed a document. The driver also signed the document and her father witnessed it. The document is dated February 20, 2023, and states:

Settlement agreement

This agreement is between [the applicant] and [the driver] in respect of an accident which took place at Monday, January 23rd 2023, at the intersection of Yorkdale mall road and Dufferin street.

Here by I, [the applicant], residing at [address] by signing this contract stating that I got compensated for the said accident to my satisfactory and I am releasing [the driver] and his car insurance provider from all kind of liabilities being financial or emotional in present and or near or far future.

I am signing this contract at my own willpower with very clear state of mind, I am perfectly fine and do not sustain any injury what so ever, physically or emotionally.

I declare that even though by possessing [the driver’s] vehicle insurance information, I did not and will not try to put any insurance claim through, because I understand taking such action would be consider as insurance fraud, a crime that is punishable by law.

The compensation provided by [the driver] is $3,000 Canadian dollars total which is paid in cash, in one payment, the payment will conclude this matter and no further compensation would be ever provided again.

9The applicant further testified that she was unaware that she could claim accident benefits until August 2024, at which time, she claims a “random person” on the street asked her if she had been hit by a car. She stated the person approached her as she was “wobbling on the street” and they discussed what happened. This “random person” then told her about accident benefits and referred her to legal counsel.

10She officially retained counsel on August 15, 2024, who provided her with the OCF-1 form and submitted it to the respondent on her behalf on August 16, 2024. I note that during her EUO, her counsel confirmed he was retained on August 15, 2023, however, I accept, based on the other information and the submissions provided, this was a simple error and the date was actually August 15, 2024.

11The applicant’s testimony includes a claim that she was unaware of the accident benefits process and was not “in the headspace to deal with it”. Her mental health was “just not right”. She also pointed to the fact that she had access to benefits through her work and that her injuries, at the time, were only minor. It was not until time progressed that her injuries got worse. She stated: “…at the time I was like, yeah, this can be done with physio and I don’t need to go anywhere. And that was my logic in – when it – initially.” Shortly after the accident, she began physiotherapy and attended sessions with a psychologist, paid for through her work benefits.

The applicant has not provided a reasonable explanation for her delay

12Section 32(1) of the Schedule provides that a person who intends to apply for accident benefits shall notify the insurer of their intention no later than the seventh day after the circumstances arose that give rise to the entitlement to the benefit, or as soon as practicable after that day.

13Once an insurer receives notice of an applicant’s intention to apply for statutory accident benefits, the insurer must provide the applicant with the appropriate OCF-1 forms, a written explanation of the benefits available, information to assist the person in applying for the benefits and information on the election relating to the specified benefits, if applicable (section 32(2)). Pursuant to section 32(5) of the Schedule, the applicant must then submit a completed and signed application for benefits to the respondent within 30 days after receiving the forms.

14Section 34 of the Schedule states that “a person’s failure to comply with a time limit set out in this Part does not disentitle the person to a benefit if the person has a reasonable explanation.” The onus is on the applicant to establish a reasonable explanation for the delay. The interpretation of “reasonable explanation” is guided by Horvath and Allstate Insurance Company of Canada, 2003 ONFSCDRS 92 (“Horvath”) and was reiterated in K.H. v. Northbridge, 2019 CanLII 101613 (ON LAT) (“K.H.”). The guiding principles are summarized as follows:

a. An explanation must be determined to be credible or worthy of belief before its reasonableness can be assessed;

b. The onus is on the insured person to establish a “reasonable explanation”;

c. Ignorance of the law alone is not a “reasonable explanation”;

d. 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;

e. The lack of prejudice to the insurer does not make an explanation automatically reasonable; and

f. 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.

15The respondent submits that the applicant’s various explanations for the delay are not believable. It argues that the applicant was aware of the accident benefits process as she gave evidence at her EUO that her brother had been involved in a serious accident in 2014 or 2015 and had received benefits. The applicant claimed that her father had helped her brother through the process but “did not share this information with her at the time.” The respondent further submits that it is not believable that the applicant was not “in the headspace” to deal with an accident benefit claim as she was able to return to work as a personal support worker (“PSW”) approximately one week post-accident and continued to work until September 2023, at which time she was terminated due to a dispute with her agency. The respondent further points to the applicant’s evidence that she went on two vacations before reporting the accident to the respondent, the first to Miami in July 2023 and the second to the Dominican Republic in approximately December 2023.

16The respondent submits that the applicant entered into an agreement with the driver whereby she accepted $3,000.00 in cash in exchange for not reporting the accident to insurers or to lawyers. By entertaining this agreement, the respondent argues that the applicant was aware that she could report the loss to an insurer had she chosen to do so.

17The applicant infers through her submissions that there was a power imbalance at the time she signed the agreement. She submits she felt pressured to sign the agreement because she felt guilty about the accident and did not want to cause problems for the driver or her father. She also submits that, at the time of the accident, her father was dealing with cancer, as well as her brother’s ongoing accident benefits claim. She argues that she did not count on his support or assistance to deal with her accident. She also argues that the agreement was drafted by the driver and she was not afforded independent legal advice to understand the implications of signing that document.

18I do not find these explanations credible or worthy of belief. The applicant’s father accompanied her to the meeting with the driver at the Tim Horton’s and, pursuant to her own testimony, her father “even told me, like, Olivia you can call lawyers who can do this but I don’t know.” The applicant infers there was a power imbalance at the meeting but does not provide any further clarification of what imbalance existed between her and the driver, how this imbalance forced her to sign an agreement without first consulting with a lawyer, or why this purported power imbalance between her and the driver should affect the rights of the respondent.

19The applicant also submits that her mental health was suffering at the time of the accident. She submits there are clinical notes and records which show that she was diagnosed with attention deficit disorder and suffered from depression and anxiety prior to the accident. Following the accident, the applicant submits she was diagnosed with borderline personality disorder. This explanation is not supported by evidence as the applicant did not submit medical documentation to support her argument. Submissions are not evidence and without the medical documentation to support her claims that her mental health impairments prevented her from contacting a lawyer or from providing notice to an insurer, they are not credible.

20In September 2023, the applicant submits she had a disagreement with her employer and was fired. As such, she submits her medical benefits were no longer available and her accident-related injuries got worse. She began paying for her treatments out-of-pocket despite no longer having a stable income. The applicant relies on I.G. v. Security National Insurance Company, 2019 CanLII 110085 (ON LAT) (“I.G.”) where she argues the Tribunal found that it goes against the purpose of the legislation to bar someone from claiming medical benefits when they truly believed their injuries would heal and did everything they could to help themselves, until they realized they could not do it on their own and needed to claim accident benefits. I am not bound by this decision but in any event, I find I.G. is distinguishable from the facts herein. In I.G., the respondent had raised the issue of the section 32(1) notification only after paying out a significant amount of accident benefits, which is not the case here.

21The applicant relies on Hussein v. Intact Insurance Company, 2025 ONSC 842 (“Hussein”), where the Court recognized the reality that consumers are in a vulnerable position particularly in the period immediately following the accident. She submits she was in a vulnerable position when she signed the agreement. I acknowledge the consumer protection mandate of the Schedule as stated in Hussein but find that here, the applicant made a conscious decision to take advantage of the $3,000.00 cash offered to her. She was accompanied by her father who advised her about her right to consult with a lawyer. She chose not to. In my view, the Schedule is consumer protection legislation but it does not allow for an insured to rely on its protections only when their circumstances change, as it did here when the applicant lost her employment. It is also important to note that, at no time did the respondent take advantage of her vulnerability or force her to go outside of the accident benefits system.

22Based on the evidence, I find that the applicant voluntarily accepted the driver’s agreement to not contact a lawyer or the driver’s insurer in exchange for $3,000.00 cash. She knew she had employment benefits that could help her pay for the treatments she required. Once she was terminated from her employment – and therefore no longer had access to her collateral benefits – the applicant contacted a lawyer and submitted a claim for accident benefits. This is not a reasonable explanation for a delay in notifying the respondent of the accident.

23An assessment of reasonableness includes a balancing of prejudice to the respondent, hardship to the applicant, and whether it is equitable to relieve against the consequences of the failure to comply with the time limits at section 32. The respondent submits that the delay has prejudiced its ability to obtain contemporaneous medical examinations and records and its ability to properly adjust the claim. I agree.

24I find that the applicant’s various explanations are not credible, believable or reasonable. The evidence supports that the applicant was aware that she could speak to a lawyer or contact the driver’s insurance provider but she chose not to. Taking into account the principles of K.H., I find that the applicant has not provided medical documentation to support that she was unable to fulfil the requirements of section 32, ignorance of her rights is not sufficient on its own, and the delay of in notifying the respondent is significant. The delay has caused prejudice to the respondent in fulfilling its obligations to investigate and assess her claim, which, in the circumstances, I find outweighs the hardship to the applicant.

25For these reasons, I find that the applicant has not met her onus to establish a reasonable explanation for her delay in notifying the respondent.

Section 55

26Pursuant to section 55(1)1 of the Schedule, an insured person shall not apply to the Tribunal under section 280(2) of the Insurance Act if the insured person has not notified the insurer of the circumstances giving rise to the claim or has not submitted an application for the benefit within the time limits prescribed in section 32.

27As outlined above, I find that the applicant did not notify the respondent within the timelines prescribed by the Schedule and she has not provided a reasonable explanation for the delay. Accordingly, I find that the applicant is statute-barred from proceeding with her application before the Tribunal.

ORDER

28I find that:

i. The applicant did not notify the respondent of the incident within the timeline prescribed by the Schedule and has not provided a reasonable explanation for the delay; and

ii. The applicant is barred by section 55(1) from proceeding with her application before the Tribunal. The Tribunal shall vacate any date that has been scheduled for the substantive issues hearing.