Court of Appeal for Ontario

Citation: 2017 ONCA 567 Date: 2017-07-04 Docket: C63365

Judges: LaForme, Hourigan and Paciocco JJ.A.

Between

Krista Leigh Morriseau Plaintiff (Appellant)

and

Sun Life Assurance Company of Canada Defendant (Respondent)

Counsel

Robert E. Somerleigh and Vlad Popescu, for the appellant

Stephen Simpson and Elizabeth Bennett-Martin, for the respondent

Heard

Friday, June 30, 2017

Appeal Information

On appeal from the judgment of Justice W. Danial Newton of the Superior Court of Justice, dated January 27, 2017, with reasons reported at 2017 ONSC 686, 65 C.C.L.I. (5th) 163.

Reasons for Decision

Overview

[1] This is an appeal of the motion judge's judgment dismissing the within action for want of jurisdiction.

Background Facts

[2] The appellant is a unionized employee of Lakehead District School Board ("LDSB"). Her employment is subject to a collective agreement that provides for certain long-term disability ("LTD") benefits. The LDSB is self-insured with respect to LTD benefits under the collective agreement.

[3] The respondent Sun Life Assurance Company of Canada ("Sun Life") has a contract with the LDSB whereby it provides administrative services with respect to LTD benefits. Pursuant to that contract, Sun Life acts as agent for the LDSB and the LDSB has ultimate final decision-making power for the payment of LTD benefits.

[4] The appellant sought LTD coverage following a motor vehicle accident she was involved in on November 2, 2015. That request was denied in a letter sent to her by Sun Life. She commenced the within action seeking, among other things, a declaration that she is totally disabled within the definition in the contract between Sun Life and LDSB and an order requiring Sun Life to approve the payment of LTD benefits.

Motion Judge's Decision

[5] The motion judge found that the court did not have jurisdiction because the dispute arises from the interpretation, application or administration of a collective agreement. Accordingly, he struck the appellant's statement of claim.

Issues on Appeal

[6] On appeal, three primary arguments are advanced: (i) Sun Life is not a party to the collective agreement and, therefore, does not have standing to challenge the jurisdiction of the court; (ii) the motion judge erred in finding that the essential character of the dispute involves a subject matter that is covered by the collective agreement; and (iii) the result of the motion judge's order is that the appellant is left without a remedy.

Court of Appeal's Analysis

[7] We would not give effect to these submissions.

Standing of Sun Life

[8] First, pursuant to r. 21.01(3)(a) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, the respondent had standing to have the action dismissed on the basis that the court lacked jurisdiction. The respondent was named as the defendant in the within action, and r. 21.01(3)(a) provides that "[a] defendant" may move to have an action dismissed on the ground that the court has no jurisdiction over the subject matter of the action.

Scope of the Collective Agreement

[9] Second, as the appellant concedes, the standard of review of the motion judge's finding that the subject matter of the dispute is covered by the collective agreement is palpable and overriding error: Barber v. The Manufacturers Life Insurance Company (Manulife Financial), 2017 ONCA 164, 65 C.C.L.I. (5th) 1, at para. 7. We are not satisfied that the motion judge made any such error in concluding that the subject matter falls within "Brown and Beatty category 2": see Hamilton v. ICI Canada Inc. (c.o.b. ICI Autocolor), [2001] O.J. No. 3916 (S.C.), at para. 9. The language of the collective agreement supported a finding that the LDSB was required to pay benefits under that agreement, even though the Benefits Booklet is not explicitly incorporated into the collective agreement. As the respondent points out, under Article C7.00 of the collective agreement, LDSB is required to continue to provide benefits in accordance with the existing benefits plans and collective agreement in effect as of August 31, 2104. The local terms in the collective agreement also reference and describe LTD benefits in the Appendix A - Benefits Summary. LDSB's obligation under the collective agreement therefore goes beyond the mere payment of premiums, as the appellant suggests.

[10] Moreover, the motion judge's analysis was supported by the analysis of comparable collective agreements in Morris v. Manufacturer's Life Assurance Co., (2005), C.C.L.I. (3d) 65 (Ont. S.C.), aff'd, (2005), 26 C.C.L.I. (4th) 66 and Duke v. Toronto District School Board, [2006] O.J. No. 1983 (S.C.). We cannot discern any palpable and overriding error in the motion judge's finding that the arrangement whereby Sun Life handles administrative aspects of LTD payments by LDSB, leaving final decision-making power with LDSB, was likely made to remove any doubt concerning the arbitrability of benefits disputes and thereby avoid the situation in Hamilton.

Availability of Remedy

[11] Third, we are satisfied that the real dispute is between the appellant and the LDSB, against whom the appellant may seek an appropriate remedy through arbitration. There is no contract between the appellant and Sun Life, and there is no legal basis upon which to order that benefits be paid by Sun Life. It is simply the agent of the LDSB. The entitlement to LTD benefits is a product of collective bargaining, and any dispute is therefore arbitrable under the collective agreement. The appellant has not advanced any convincing grounds for concluding that an arbitrator would decline jurisdiction over a claim for those benefits.

Disposition

[12] The appeal is dismissed. The respondent is entitled to its costs of the appeal, which we fix at $5,000, inclusive of fees, disbursements and taxes.

H.S. LaForme J.A.

C.W. Hourigan J.A.

David M. Paciocco J.A.