Fraczek et al. v. Pascual et al.
[Indexed as: Fraczek v. Pascual]
57 O.R. (3d) 716
[2001] O.J. No. 5466
Docket No. 489/00
Ontario Superior Court of Justice Divisional Court Lang, Day and Czutrin JJ.
November 19, 2001*
*Note: Reasons released on January 16, 2002.
Insurance -- Automobile insurance -- Statutory Accident Benefits -- Death benefits -- Both mother and father of deceased claimed death benefits -- Deceased dependent on both parents -- Section 25(2)(5)(i) of Statutory Accident Benefits Schedule -- Accidents on or after November 1, 1996 required insurer to make payments to each of two persons on whom deceased dependent -- Statutory Accident Benefits Schedule -- Accidents on or after November 1, 1996, Reg. 403/96, s. 25.
After the death of their daughter in a motor vehicle accident, both the mother and father of the deceased applied for death benefits. The deceased had been dependent on both of her parents. The insurer denied the mother's claim. The mother's action for death benefits was dismissed on a motion for determination of a question of law. The motions judge held that s. 25(2)5.i. of the Statutory Accident Benefits Schedule -- Accidents on or after November 1, 1996 was only intended to benefit one person. The mother appealed.
Held, the appeal should be allowed.
Section 25(2)5.i. changed the wording of the previous Regulations to provide for payment not to "the" person upon whom the deceased was dependent, but to "a" person upon whom the deceased was dependent. There must have been a purpose for that change. Further, s. 25(2)5.i. is, by application of the definition of dependant in s. 2(6), applicable to more than one person. There can be two persons upon whom the deceased was dependent, one of whom was the principal financial provider, and the other of whom was the principal caregiver. Had the legislature intended to require these two persons to share the benefits, it could easily have said so. Section 25(2)5.i. required the insurer to make payments to each of the two persons who qualified under s. 2(6).
APPEAL from an order dismissing an action for death benefits.
Cases referred to Jarvis v. Allstate Insurance Co. (1996), O.I.C.D. No. 148; John v. C.I.B.C., unreported, released July 28, 1998
Rules and regulations referred to Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rule 21.01(a) Statutory Accident Benefits Schedule -- Accidents before January 1, 1994, R.R.O. 1990, Reg. 672, ss. 3(2), 11(1) Statutory Accident Benefits Schedule -- Accidents after December 31, 1993 and Before November 1, 1996, O. Reg. 776/93, s. 4 Statutory Accident Benefits Schedule -- Accidents on or after November 1, 1996, O. Reg. 403/96, ss. 2(6), 25(2), (4)
Michael Huclack, for plaintiffs/appellants. Michael W. Smith, for defendant State Farm.
The judgment of the court was delivered by
[1] LANG J. (orally): -- After the death of a daughter in a motor vehicle accident, the father applied to State Farm, the daughter's insurer, for death and funeral benefits. They were paid. The mother then also applied for death benefits.
[2] State Farm issued a cheque to the father, and denied the mother's claim. On a rule 21.01(1)(a) [of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194] motion on a question of law, the motions judge dismissed the mother's action for death benefits. The mother appeals on the grounds that the motions judge erred in dismissing the action.
[3] For the purposes of the motion, and accordingly for the purposes of this appeal, both counsel ask that we accept as a fact that the daughter was dependent on each of the father and the mother.
[4] The issue before the motions judge was the statutory interpretation of the Accident Benefit Regulations for payment of death benefits. The 1990 Regulation provided for payment to "the person upon whom the deceased was dependent" [s. 11(1)], or that person's spouse in certain circumstances. A person was dependent on another person if he or she was "principally dependent for financial support" [s. 3(2)]. Statutory Accident Benefits Schedule -- Accidents before January 1, 1994, R.R.O. 1990, Reg. 672.
[5] In 1990 then, the Regulation clearly contemplated only one such payment to "the person" who principally provided the deceased with financial support. This interpretation is supported by Jarvis v. Allstate Insurance Co. (1996), O.I.C.D. No. 148.
[6] The 1994 amending regulation similarly provided for payment to "the" person, but expanded the definition of dependant to a deceased who was "principally dependent for financial support or care". Statutory Accident Benefits Schedule -- Accidents after December 31, 1993 and Before November 1, 1996, O. Reg. 776/93, [s. 4].
[7] Accordingly, it would seem a deceased could have been financially dependent on one person, and dependent on a different person for his or her care. When the Regulation was again amended in 1996, the same definition of dependant was retained, continuing a possibility of two beneficiaries, one of whom was the principal financial provider and the other of whom was the principal caregiver.
[8] Subsection 25(2)5.i. changed the wording of the previous Regulations to provide for payment not to the person but to a person, Statutory Accident Benefits Schedule -- Accidents on or after November 1, 1996, O. Reg. 403/96, s. 25. As the motions judge noted, this amendment must be interpreted in the context of other similar provisions in the Regulation. The other subsections [of s. 25(2)] provide for a death benefit as follows:
A payment to the . . . spouse or same sex partner . . .;
A payment to each of . . . the dependants . . .;
[In the absence of a spouse] . . . an additional payment . . . to the . . . dependants to be divided equally among the persons entitled;
A payment . . . to each former spouse or same sex partner . . .
A payment . . . to:
i. a person in respect of whom the insured person was a dependant at the time of the accident,
ii. The spouse . . .;
iii. The dependants . . . to be divided equally among the persons entitled.
[9] Section 25(4) also specifically contemplates dividing death benefits equally where there is more than one spouse.
[10] The motions judge agreed with the endorsement of Kruzick J. in John v. C.I.B.C., unreported, released July 28, 1998, where he held that ss. 25(2)5.i. was only intended to benefit one person. In so holding, the motions judge in this case, relying on John, notes that other subsections, where it is intended to benefit more than one person, use precise language specifying multiple beneficiaries. For example, s. 25(2)2 and 4 use the words "each of", while 3 refers to the plural "dependants". In contrast, 1 restricts the payment to the spouse. Where there are multiple beneficiaries and the Regulation intends only that one payment be shared, it specifies that the payment is to be divided amongst those beneficiaries. See ss. 25(2)3 and 5.iii. and s. 25(4).
[11] Such clarity of language is absent from ss. 25(2)5.i. The legislature decided to change the wording from "the person" to "a person". Presumably there was a purpose for that change. Further, the subsection is, by application of the definition of dependant in s. 2(6), applicable to more than one person. There can be, as is accepted for the purposes of the motion, two persons, one of whom is the principal financial provider, and the other of whom is the principal caregiver. Had the legislature intended to require these two persons to share the benefit, it could easily have so specified as it did in other provisions.
[12] With respect, the motions judge, in our view, erred in his interpretation that only one payment is contemplated by the Regulation. The ambiguity in the wording of the provision must be considered in the context of the purpose of the Regulation which is to provide modest financial recognition of a parent's loss of their dependant. In this case, their dependant child.
[13] Further, we consider the possible outcomes of the differing interpretations. To hold that the insurer need only make one payment would have one of two results, each contrary to the purpose of the legislation. The first result would be the result chosen by this insurer; a single payment made to one provider. Here, the insurer paid the father in preference to the mother. The legislature could not have intended to place the insurer in the unenviable position of choosing one of the providers over the other, and thereby leaving itself vulnerable to litigation.
[14] The alternative result might be the one suggested by the motions judge; the insurer could make the payment jointly to the providers. This would, with respect, leave the beneficiaries in an undesirable adversarial position, particularly in a situation where the two providers may be at odds with each other. Such as a situation might well arise between a mother and a father, both providers, but who are living separately from each other. In these days, as unfortunate as it might be, it is not uncommon for the beneficiaries, usually the parents, to be living separately. In such circumstances, when the deceased is a minor child, one parent may be the principal financial provider and the other the principal caregiver. It is not acceptable, as is argued by the insurer, that one provider be given preference over the other.
[15] In our view, had the legislature intended the two providers to share the benefit, it would have so provided in the manner it did elsewhere in the section. Given the ambiguity of the provision, the interpretation most consistent with the purpose of the legislation, the context of this section in the regulatory scheme for death benefits, the recent recognition by the legislature of caregivers in addition to financial providers, and the most efficacious interpretation, we are of the view that s. 25(2)5.i. requires the insurer to make payments of $10,000 to each of the two persons who qualify under s. 2(6).
[16] Accordingly, the appeal is allowed and the order of the motions judge is set aside.
[17] With this result, the costs order of the motions judge is set aside. Costs of the motion below of $1,000, and the appeal before us at $1,500, to the appellants.
Appeal allowed.