Court File and Parties

Court File No.: 05-17553 Date: 2013-07-16 Superior Court of Justice - Ontario

Re: Michelle Madder, Plaintiff And: South Easthope Mutual Insurance Company, Cunningham Lindsey Canada Limited, Dan Vaspori, Lawrence Diamond, Jack Wettlaufer, Wayne Tebbatt, Frank Rider, Steven Howell, Daryl Stevenson, Debra Gerber, Helen Schildermans, Lloyd Debus, Douglas Wettlaufer, Murray Schlotzhauer, Murray McGonigle, Donald Henry, and Gordon Gross, Defendants

Before: The Honourable Mr. Justice Robert J. Nightingale

Counsel: J. L. Poproski, Counsel, for the Plaintiff Bruce Keay, Counsel, for the Defendant, South Easthope Mutual Insurance Company

Heard: May 8, 2013

Endorsement

[1] The Defendant South Easthope Mutual Insurance Company (the Defendant) has brought this motion for summary judgment to dismiss the Plaintiff’s action because of a dispute regarding statutory accident benefits arising from a motor vehicle accident involving the Plaintiff on July 21, 2002.

[2] The Defendant’s position is that the Plaintiff’s action is statute barred because she failed to mediate her claim for benefits and because she failed to return the settlement funds that had been paid to her by the Defendant pursuant to a full and final settlement release of her accident benefits she signed prior to initiating this action.

[3] The Plaintiff opposes the Defendant’s motion and has brought her own motion claiming partial summary judgment and a declaration that the Plaintiff is entitled to payment of income replacement benefits until the Defendant complies with its alleged obligations under the Statutory Accident Benefits Schedule (SABS) regarding the requested Designated Assessment Centre (DAC) Assessment.

Defendant’s Motion for Summary Judgment

[4] The Defendant’s affidavit evidence of Russell Tilden confirmed that as a result of a single motor vehicle accident involving the Plaintiff as the driver on July 21, 2002, the Defendant began providing the Plaintiff with benefits to which she was entitled after she had applied for them in an Application for accident benefits dated July 30, 2002.

[5] The affidavit did not give many details of the Plaintiff’s injuries in the accident but the Plaintiff’s application form described her having a broken ankle and stitches to her knee. It also indicated that she had been employed as a manager in a nutrition and fitness store from June 2002 to the date of the accident working 32.5 hours a week at a gross weekly income of $260.

[6] Mr. Tilden’s affidavit confirmed that the Plaintiff and Defendant appeared to come to an agreement on a settlement of the Plaintiff’s complete accident benefits file on a full and final basis with the Plaintiff signing a full and final release on or about July 14, 2003. The Defendant paid the Plaintiff a lump sum of $3000 and the full and final release and settlement disclosure notice signed by the Plaintiff on July 14, 2003 attached to the Defendant’s affidavit appears to be in compliance with Section 9.1 of the Statutory Accident Benefits Settlement regulation in effect at the time being R.R.O. 1990 Regulation 664 as amended by O. Reg. 275/03.

[7] The Defendant’s evidence was that the Plaintiff gave no indication that she was dissatisfied with the settlement on her receipt of the settlement funds. On November 26, 2004 the Plaintiff’s present counsel requested documentation regarding the Plaintiff’s accident benefits claim that made no mention of the Plaintiff being dissatisfied with the settlement or an intention to rescind the settlement.

[8] The Defendant’s first notice that the Plaintiff intended to set aside the settlement was when it received the Statement of Claim in this action that was issued on April 8, 2005. The Statement of Claim asks for a declaration that the release signed by the Plaintiff was a nullity and for “damages for breach of contract $600,000”. The Statement of Claim also asks for substantial amounts of damages for the “tort of conspiracy”, “mental distress”, “the duty to act in good faith”, and aggravated, punitive and exemplary damages. The claim also asked for interest at the statutory rate of 2% per month as outlined in the SABS schedule.

[9] The Statement of Claim pleads that the Plaintiff suffered a complete inability to lead a normal life and a substantial inability to engage in any occupation for which she is reasonably suited by education, training or experience that entitles her to a potential claim for income replacement benefits over her lifetime, medical, rehabilitation, housekeeping, and attendant care benefits. It, among other things, alleges the Defendant breached its duty to the Plaintiff by unlawfully terminating her income replacement benefits and medical and rehabilitation benefits.

[10] The Defendant states that these were all disputed benefits but that at no time prior to the issuance of the Statement of Claim did the Plaintiff file for mediation of the disputed benefits claimed with the Financial Services Commission of Ontario (FSCO). Further, at no time since the Statement of Claim was issued to the date of the hearing of this motion had the Plaintiff filed for mediation.

[11] Moreover, at no time prior or subsequent to the issuance of the Statement of Claim has the Plaintiff repaid to the Defendant the $3000 that she received as settlement funds for settling her entire accident benefits claim with the Defendant on a full and final basis.

[12] Plaintiff’s Counsel was advised by letter from the Defendant’s Counsel of August 9, 2005 that the Plaintiff had not complied with the settlement regulation of the SABS by not repaying the Defendant the settlement funds received and by not filing for mediation as required by the Insurance Act.

[13] That letter also confirmed that the Defendant was prepared to reinstate the income replacement benefits and pay the Plaintiff the arrears that would be owing to date. The Defendant asked for full details of the Plaintiff’s earnings since the date of the signing of the release before an income replacement benefit cheque would be paid and the right to have an independent medical examination under Section 42 of the SABS.(i.e. to determine if the Plaintiff met the eligibility criteria for disability under the SABS)

[14] The Defendant’s letter stated that it had agreed to reopen the file without having the Plaintiff go through the usual litigation route to do so and would deal with the matter as if no settlement had been entered into. The amount that the Plaintiff received in consideration of the release would simply be used as a credit in favour of the Defendant in regards to any medical rehabilitation expenses that had been incurred by the Plaintiff or would be submitted.

[15] The letter stated the Defendant was not going to rely on the technicalities of the repayment of the settlement funds or the requirement to mediate. However, it is also stated that the Defendant required significant information from the Plaintiff including her activities since the settlement and her post-accident income she earned. It also stated that if the file was re-opened the Plaintiff was going to be receiving an income replacement benefit and entitled to claim medical and rehabilitation benefits (subject to the provisions of the Schedule), then the Defendant had a right to a medical examination under Section 42 of the SABS.

[16] However, it appears that the Plaintiff’s lawyer did not respond to this request and the Defendant filed its Statement of Defence which included in the defence that the Plaintiff had has complied with the requirement to first return to the settlement funds and proceed to mediation of her claim. This litigation then proceeded.

[17] When the Plaintiff was examined for discovery on June 25, 2010, the Plaintiff admitted that she had not returned the settlement funds to the Defendant.

[18] Lastly, the Defendant confirmed that the Plaintiff failed to mediate the disputed benefits prior to or since issuing the Statement of Claim which had been apparent to the Plaintiff’s Counsel for several years.

Plaintiff’s Evidence

[19] In response, the Plaintiff provided her affidavit which alleges that that she sustained a right ankle fracture, a disc herniation, neck, shoulder and back pain, headaches a pain and adjustment disorder with anxiety and depression as a result of the accident. She stated that she was unable to work as a customer service representative at Spartan Nutrition where she alleged she had worked full time because of her injuries. She then completed her application for accident benefits on July 30, 2002 and started to receive them at the rate of $175.45 per week.

[20] She alleges that the Defendant’s independent medical assessment by Dr. Friars of December 19, 2002 confirmed that her fractured ankle rendered her unable to return to her pre-accident occupation because of the demands of constant weight-bearing placed upon it.

[21] She attempted to return to work on a part-time basis on February 24, 2003 saying she was unable to perform the required duties of the position after a short period of time. She provided the appropriate disclosure of that post-accident income to the Defendant on April 16, 2013.

[22] The Defendant provided an OCF – 17 Notice of Stoppage of Weekly Benefits and Request for an Assessment by a DAC to the Plaintiff on April 24, 2003. That form clearly and unequivocally confirmed that the Defendant would terminate the Plaintiff’s income replacement benefit effective May 6, 2003 and provided the reason that she no longer qualified for the benefit as she was able to resume the duties of her pre-accident employment.

[23] The Plaintiff signed and returned that form to the Defendant’s adjuster which confirmed that she disagreed with the stoppage of the income replacement benefits and requested a disability DAC assessment. She also signed the required OCF – 14 Permission to Disclose Health Information to the DAC also dated April 24, 2003.

[24] The Defendant then sent the appropriate form to request a disability DAC assessment and received a reply from the assessment centre regarding that on May 12, 2013.

[25] The Defendant stopped paying the income replacement benefits to the Plaintiff on May 6, 2013 although there was evidence that the adjuster thought that the Plaintiff was entitled to them until the disability DAC was completed.

[26] The Plaintiff alleged that the Defendant’s adjuster came to her house and encouraged her to sign a full and final release for the sum of $3000. She said she felt pressured to sign the forms and did not receive an explanation from the adjuster that she had an option not to sign them and still receive benefits from the insurer.

[27] At no time did the Plaintiff suggest that she did not read or understand the final release or settlement disclosure notice form that bear her signature nor did she allege that she didn’t sign it. She did not deny in her affidavit that she had not repaid the $3000 settlement amount nor did she deny that she had not commenced any mediation proceedings with respect to the accident benefits that she is presently claiming in her Statement of Claim before it was issued.

[28] In particular, she said that she caused the Statement of Claim to be issued claiming that the Defendant unlawfully obtained the release, unlawfully failed to pay accident benefits and claiming damages for breach of contract, conspiracy, mental distress and breach of the duty to act in good faith. The Plaintiff alleged that she was relying on the Defendant’s Statement of Defence paragraph 23 which states as follows:

This Defendant pleads that upon receipt of the Statement of Claim, a review of this matter, and despite the failure of the Plaintiff to satisfy the statutory requirements as aforesaid, and provide documentary particulars in regards to her alleged ongoing difficulties, this Defendant had agreed to re-open her file and deal with the same in accordance with the provisions of the Statutory Accident Benefits Schedule.

[29] However, it is significant to note that that pleading clearly suggests that the claims were to be adjusted in accordance with the SABS. The Insurance Act provisions and the regulations there under required that the Plaintiff return the settlement funds to the Defendant and to apply for mediation in respect of any issue regarding the settlement of the statutory accident benefits claim and denial of benefits. The Statement of Defence stated that because of the Plaintiff’s noncompliance, the action would have to be stayed until the Plaintiff satisfied the terms of these statutory provisions. The Defendant also pled that despite a request for the required information from the Plaintiff, the Plaintiff had not provided the Defendant with documentary disclosure in support of her claims set out in the Statement of Claim and asked that the action be dismissed as against it with costs.

[30] The Plaintiff alleged that the Defendant had not arranged for her request that she attend a disability DAC assessment which was abolished with changes to the SABS regulations in March 2006.

[31] Lastly, she attached to her affidavit unsworn medical reports of Dr. Rathbone and a functional vocational evaluation of Dr. Tartaglia suggesting she currently suffered an inability to perform the essential tasks of her employment that she had prior to the accident.

[32] The parties did not proceed to cross examinations on their affidavits filed with respect to this motion and the transcripts of the examinations for discovery of the parties were not provided to the court.

Analysis

[33] Rule 20.04 of the Rules of Civil Procedure provides that the court shall grant summary judgment on a motion of a party if it is satisfied that there is no issue requiring a trial with respect to a claim or defence.

[34] The purpose of the amended Rule 20 is not to eliminate all trials but only to eliminate unnecessary trials i.e. where there is no factual or legal issue raised by the parties that requires a trial for its fair and just resolution. Combined Air Mechanical Services Inc. v. Flescsh 2011 ONCA 764 (OCA).

[35] Of the cases amenable to summary judgment, one involves defences that are shown to be without merit and another in which the trial process is not required in the interest of justice. Regarding the latter category, the motions judge must determine whether a full appreciation of the evidence and issues that is required to make dispositive findings can be achieved by way of summary judgment or whether this full appreciation only be achieved by way of a trial. Combined Air, supra, paragraphs 50 to 51 and 75.

[36] Cases amenable to summary judgment are those where the full appreciation test can be met because they are document driven, have limited testimonial evidence or have limited contentious factual issues.

[37] The motions judge in the summary judgment motion can weigh the evidence, evaluate the credibility of a deponent and draw any reasonable inference from the evidence in determining whether there is a genuine issue requiring a trial.

[38] Each party has an obligation to put its best foot forward on a motion for summary judgment including all evidence on which they intend to rely. They cannot suggest there may be other evidence available at trial that may assist in establishing its claim or defence. Combined Air, supra.

Failure to Repay Settlement Funds

[39] The Automobile Insurance Regulations permit an insured to rescind a settlement longer than two business days after the insured signs the disclosure notice and the release if the insurer has not complied with the written disclosure requirements on a form approved by the Superintendent. The Plaintiff has not alleged in her affidavit or in her Statement of Claim that the Defendant did not provide the appropriate written disclosure which included the required information of Regulation 9.1.

[40] However, in any event, Subsection 9.1 (7) states that the insured person shall rescind a settlement under Subsection 4 or 5 by delivering a written notice to the office of the insurer or its representative and returning any money received by the insured person as consideration for the settlement.

[41] Moreover, Regulation 9.1 (8) requires that the insured must repay his settlement funds prior to commencing a mediation:

No person may commence a mediation proceeding under Section 280 of the Act with respect to benefits that were the subject of a settlement or a purported settlement unless the person has returned the money received as consideration for the settlement.

[42] In Daneliak-Dowling v. Co-operators General Insurance Company 2002 Carswell ONT 2853 , Rutherford J. confirmed that this regulation required that the Plaintiff repay the insurer the settlement funds received in the settlement she was attempting to rescind and confirmed that mediation proceedings may not be commenced with respect to the amounts in dispute unless such repayment has been made .

[43] That approach was confirmed by Belch J. in Lindsay (Litigation Guardian of) v. Martin 2004 Carswell ONT 2240 who held that settlement monies received on a settlement that the insured wished to rescind must first be repaid and mediation that fails must then take place before the Plaintiff’s action can continue.

[44] The Plaintiff has not repaid the settlement funds to the Defendant. Plaintiff’s Counsel on the hearing of the motion indicated she had her law firm’s cheque in the amount of the settlement funds available to provide to the Defendant for that although there was no Affidavit evidence provided on that point.

[45] Potentially, but for the Defendant’s letter of August 9, 2005 and paragraph 23 of its Statement of Defence, discussed below, there would be no genuine issue requiring a trial on that point and the Defendant would normally be entitled to a dismissal of the Plaintiff’s action or at least a stay of the proceedings until the settlement funds were repaid.

Failure to Mediate

[46] Regulation 9.1 (8) clearly makes reference to the requirement of the insured to proceed to mediation under Section 280 of the Insurance Act with respect to benefits that were the subject of a settlement or purported settlement that the insured is attempting to rescind after the insured returns the settlement funds.

[47] Section 279 of the Insurance Act confirms the mandatory requirement of an insured to proceed to mediation under Section 280 to 283 of the Statutory Accident Benefits Schedule regarding any dispute to the insured person’s entitlement to statutory accident benefits.

[48] Section 279 (1) states that disputes in respect of any insured person’s entitlement to statutory accident benefits or in respect of the amount of statutory accident benefits to which an insured person is entitled shall be resolved in accordance with Sections 282 to 283 of the Statutory Accident Benefits Schedule.

[49] Subsection 281 (1) of the Insurance Act permits an insured person to choose between bringing a proceeding in the court system or proceeding to arbitration with FSCO.

[50] The Ontario Court of Appeal recently in the decision of Hurst v. Aviva Insurance Company 2012 ONCA 837 confirmed that an integral part of Ontario’s comprehensive statutory scheme regulating automobile insurance is the process for resolving disputes between insured persons and their insurers set out in Sections 282 to 283 of the Insurance Act and in the regulations. Juriansz J.A. confirmed at page 5 that central to this process was the mandatory mediation of such disputes and that Section 281 (2) of the Act prevents insured persons from commencing court actions unless they at first tried mediation and it has failed.

[51] S. 281 (2) provides:

No person may bring a proceeding in any court, refer the issues in dispute to an arbitrator under Section 282 or agree to submit an issue for arbitration in accordance with the Arbitration Act, 1991 unless mediation was sought, mediation failed and, if the issues in dispute were referred to an evaluation under Section 280.1, the request of the person who performed the evaluation has been given to the parties.

[52] In the concurrently released decision of Younis v. State Farm Mutual Automobile Insurance Company 2012 Carswell ONT 15050, 2012 ONCA 836, Juriansz J.A. again said that the terms of Section 281 (2) of the Act are clear in that no person may bring a proceeding until mediation has failed. In that action, the Plaintiff commenced his application to FSCO for mediation but commenced his civil action for statutory accident benefits only a few days later without awaiting the 60 day prescribed time limit mandated for completion of the mediation under the regulations.

[53] Juriansz J.A. confirmed that the insured jumped the gun and brought the court proceeding before mediation had failed. He found that the insured commenced the action in contravention of the statute and that the statute must be applied as insured persons cannot commence civil actions until mediation has failed.

[54] Unlike this case where the Plaintiff at no time even commenced mediation with respect to whether or not the settlement was rescinded or with respect to her continued entitlement to accident benefits under the Defendant’s policy, the Plaintiff in the Younis decision had commenced the mediation process but did not complete it before commencing the action. Juriansz J.A. confirmed that the statute did not permit that strategy and found that as the commencement of the action was statute barred, it was quashed. In other words, it wasn’t a question of simply staying the action pending completion of the mediation but rather a dismissal of the action was required and was granted.

[55] The Divisional Court in Amorini v Select Coffee Roasters Inc. 2001 62759 (ON SC), [2001] O.J. No. 581 confirmed a similar approach that the courts had no jurisdiction to hear the Plaintiff’s claims for accident benefits until mediation had taken place as mediation was a statutory precondition to the Plaintiff’s bringing such court proceedings. Accordingly, the Plaintiff’s action that had been commenced without mediation was dismissed and the Plaintiff was not entitled to relief against forfeiture under Section 129 of the Insurance Act as it was a case of noncompliance rather than imperfect compliance with the statutory condition.

[56] The Plaintiff did not dispute that she did not proceed to mediation at any time with respect to her attempt to rescind the settlement agreement or to claim income replacement benefits and other benefits under the Defendant’s SABS policy that were in dispute. Her argument was that what was being claimed in this action was not payment of income replacement or other benefits that were the subject matter of the settlement agreement or that have accrued since the date of the settlement.

[57] Rather, her argument was that her claim was that she was entitled to damages and for an order requiring the Defendant to reinstate payment of the IRBs since July 2003 to date because of the Defendant’s failure to comply with the then regulations requiring a DAC assessment while awaiting that assessment and report. The argument was that there was no need to mediate because there was no claim being made for the disputed benefits.

[58] I had considerable difficulty appreciating that argument especially as the Statement of Claim was rather clear that the Plaintiff wanted to treat the settlement agreement as a nullity and claimed substantial damages for non-payment of statutory accident benefits including the income replacement benefits. Moreover, the Plaintiff brought her own motion for summary judgment asking for declaration that she was entitled to payment of income replacement benefits until the Defendant set up the appropriate DAC assessment which is no longer possible as they have been abolished. Plaintiff’s Counsel suggested the distinction was that her client was not actually claiming accident benefits that were in dispute.

[59] In my view, this is simply a distinction without a difference. There is no question that what is in dispute is the Plaintiff’s entitlement, or lack thereof, to rescind the settlement agreement and to now claim for significant accident benefits since the date of the settlement agreement to date and potentially into the future.

[60] As indicated above, the intent of the legislation and regulations is clear. The Plaintiff was reminded of her obligations to proceed to mediation back in August 2005 but simply has declined or refused to do so since. The Defendant has a statutory right to have this matter proceed to mediation first before any litigation is commenced as much as it is the Plaintiff’s obligation to do so.

[61] Furthermore, even if the Defendant’s letter of August 9, 2005 can be construed as the Defendant’s agreement to set aside the settlement agreement altogether, it was on terms which were not complied with by the Plaintiff. The Plaintiff still did not commence or proceed with any mediation of its claim for accident benefits payable since the date of the settlement which were obviously still in dispute. Although the Plaintiff’s argument was that there was no refusal to pay those benefits if the settlement agreement was set aside, the Defendant had in fact clearly refused pay those benefits as of May 6, 2003 when it sent out the appropriate Explanation of Benefits forms and Notice of Stoppage of Weekly Benefits and Request for Assessment to the Plaintiff and then proceeded to make the required referral for the DAC assessment at which time the settlement agreement was then entered into between the parties.

[62] In my view, as the requirement to mediate first goes to the jurisdiction of this Court, the Plaintiff was still required to proceed with mediation of the Defendant’s continued denial of benefits under the SABS.

[63] Because of the binding decisions of the Court of Appeal and Divisional Court on this court, the Plaintiff’s action is dismissed by way of summary judgment as there is no genuine issue requiring a trial due to the Plaintiff’s failure to mediate or repay the settlement funds before commencing this action.

[64] In my view, the Plaintiff was still required to proceed with mediation of the Defendant’s continued denial of benefits under the SABS notwithstanding the Defendant’s letter of August 9, 2005 and paragraph 23 of the Statement of Defence. The Plaintiff’s failure to do so accordingly results in the dismissal of her action for payment of accident benefits by way of summary judgment in favour of the Defendant.

Claims for Damages for Mental Distress and Bad Faith

[65] The Plaintiff submits that her claims for damages for bad faith and mental distress in the Statement of Claim are independent causes of action, are inextricably linked and are not subject to the mediation process contained under the Insurance Act. These additional damages include aggravated, punitive and exemplary damages.

[66] In my view, the claim for mental distress is not an independent cause of action. Rather, damages for mental distress may flow from the Defendant’s breach of the insurance policy where such mental distress damages were in reasonable contemplation of the parties at the time the contract was made Fidler v Sun Life 2006 SCC 30, 2006 2SCR 3; McLean v. Echelon General Insurance Company 2011 ONCA 649.

[67] There are two reasons why the Plaintiff’s claim for these damages should also be dismissed.

[68] Firstly, these claims for bad faith and mental distress damages in connection with accident benefits refusals are “in respect of” the Plaintiff’s entitlement to or the amount of accident benefits to which she is entitled under s. 279 (1) of the Insurance Act. Bad faith clams in connection with no fault benefits refusals are subject to the procedures and time limits in ss. 280 to 283 of the Insurance Act. Arsenault vs. Dumfries Mutual Insurance Company 2002 23580 (ONCA).

[69] The Court held that an insured’s bad faith claim in connection with no fault benefits was not an actionable wrong but was in fact exactly the kind of dispute over no fault benefits entitlement contemplated by the dispute resolution scheme in the Insurance Act. The insured could not circumvent the mandatory requirements of that dispute resolution scheme through the guise of linguistic reformulation.

[70] Similarly, in my view, that includes the requirement that those claims proceed to mediation first, which has not taken place.

[71] Secondly, because the Plaintiff’s action for payment for accident benefits which she says were wrongfully refused in breach of the insurance policy has now been dismissed, how can the Plaintiff’s claim for damages for mental distress and bad faith even proceed when there is now no basis for it? By reason of the dismissal of the Plaintiff’s action for benefits, effectively the Plaintiff is not entitled to claim statutory accident benefits from the Defendant.

[72] If the Plaintiff has no such claims against the Defendant at this time, there cannot be any finding that the Defendant has been in breach of its obligation to pay those benefits under the SABS or the Insurance Act. Without any breach of its obligations, there cannot be any claims for damages for bad faith or for mental distress.

Conclusion on Defendant’s Motion

[73] Accordingly, the Plaintiff’s entire action including the claims for the remaining damages for bad faith in handling of the claims, mental distress, and punitive, aggravated and exemplary damages are dismissed.

[74] The Defendant is entitled to its costs of this action which would normally be on a partial indemnity basis. If the parties cannot agree on payment of the Defendant’s costs, the defendant can make submissions with respect to those costs within 15 days of this decision with the Plaintiff to provide her responding submissions within 7 days thereafter.

Plaintiff’s Motion for Summary Judgment

[75] As indicated above, the Plaintiff has brought a motion for summary judgment for an Order granting “partial summary judgment” and a declaration that the Plaintiff is entitled to payment of income replacement benefits until the Defendant complies with its obligations under the SABS in regard to the requested DAC assessment.

[76] Notwithstanding the dismissal of her action by summary judgment, I will address her motion in any event. Plaintiff’s Evidence

[77] In addition to the facts noted above, the plaintiff indicated that she continues to suffer from the following impairments: headaches, neck, shoulder and back pain, tingling and numbness in the fingers and toes, depression, stress, fibromyalgia and insomnia.

[78] She swore that she was working full time as of the date of the car accident as a customer service representative at Spartan Nutrition. This is clearly contradictory to the information she provided in her Application for accident benefits to the Defendant immediately after the accident that she was only working there part-time 32.5 hours per week from June to July 21, 2002. A simple mathematical calculation from the information provided in her application confirms that she made it $8.00 per hour in that part-time job.

[79] She confirmed that on or about February 24, 2003, seven months after the accident, she attempted to return to work by working part-time elsewhere at an hourly rate of $8.20 per hour which she said was for a short period of time as she was “unable to perform her regular duties of that job”.

[80] She then entered into an educational program to become a Pharmacy Technician, completed the academic portion of the program but states she was unable to complete the required work portion due to her impairments which the school was unwilling to accommodate.

[81] Nevertheless, she confirmed that she had been employed since that time in a series of short-term jobs in the customer service field suggesting she had been forced to leave those jobs due to an inability to perform the job duties for an extended period of time because of her impairments.

[82] Since 2008, she confirmed that she has been working for a delivery service delivering a variety of products and being able to set her own hours. Presently, she was working four days per week and about six hours per shift depending on the need for deliveries. She said she struggles with doing the job having difficulties with the lifting and walking requirements.

[83] Her evidence was that on April 24, 2003, she received an OCF – 17 Notice of Stoppage of Weekly Benefits from the Defendant which indicated that if she disagreed with it she had the right to ask for an assessment by a DAC to determine whether her disability continued. She signed and returned that form to the Defendant’s adjuster confirming that she disagreed with the stoppage of benefits and requesting a DAC assessment. She also submitted the signed OCF – 14 Permission to Disclose Health Information which was required under the regulations at the time.

[84] Her further evidence was that even though the Defendant’s adjuster and the Defendant were aware that she was entitled to continue payment of her income replacement benefits until the DAC was completed, the Defendant stopped payment of those benefits on May 6, 2003 even though she said she was willing to attend the DAC assessment.

[85] Her evidence was that on or about July 14, 2003 the adjuster and another woman whose name she did not know came to her house and told her to sign a Full and Final Release of all her benefits including health care benefits for $3000. She said that the conversation took place in the hallway of her apartment building and believed she was required to sign the forms and did not know there was an option not to sign the forms. The Plaintiff’s version of that conversation is very much disputed by the Defendant as noted below.

[86] The Plaintiff stated that the Defendant’s adjuster would be willing to pay her the amount it would otherwise cost the Defendant to set up the DAC assessment.

[87] She admitted that she signed the final release and did not deny that she received the $3000 settlement amount. Nowhere in her Affidavit does she suggest that she wasn’t fully aware of the terms of the release or that the disclosure made by the Defendant in order to achieve the settlement under the SABS was not full and complete .

[88] It wasn’t until almost 2 years later on April 8, 2005 that she issued the Statement of Claim which alleged that the Defendant unlawfully obtained a final release and unlawfully failed to pay the statutory accident benefits.

[89] She swore that the Defendant on August 30, 2005 agreed to reopen her file and deal with it in accordance with the provisions of the Statutory Accident Benefits Schedule. However, at no time did the Defendant arrange for or request that she attend a DAC assessment.

[90] The Plaintiff then attached to her Affidavit the report of a neurologist Dr. Rathbone dated August 13, 2012 which was not sworn. Moreover, the Plaintiff provided no proof that the required notice under the provisions of the Evidence Act and the Rules to rely on the contents of the report had been provided to the Defendant prior to this motion.

[91] The Plaintiff relies on an excerpt from that report of Dr. Rathbone wherein he states that the Plaintiff suffers a substantial inability to perform the essential tasks of the employment in which she spent most of the time during the 52 weeks before the accident and that this is directly related to the accident- related impairments. Specifically, the report does not say that that the Plaintiff has suffered that substantial disability since July 2003 continuously to date.

[92] Furthermore, with respect to the applicable test for entitlement to IRBs after the two-year mark, Dr. Rathbone only states that she had been on and off work since the motor vehicle accident and that she endorses difficulty with employment tasks due to her accident- related impairments. In particular, nowhere in the report does Dr. Rathbone say that in his opinion the Plaintiff has suffered a complete inability to engage in any employment for which she was reasonably suited by education, training or experience as a result of the motor vehicle accident of July 30, 2002, which is the applicable test for disability after the 2-year mark under the SABS.

[93] The Plaintiff then attached to her Affidavit an unsworn functional vocational evaluation letter by Dr. Tartaglia and Lisa Simmons of November 29, 2012 again without proof of any notice of intention to rely on that report under the Evidence Act or the Rules.

[94] The Plaintiff referred to an excerpt from that report wherein the opinion was that the Plaintiff did suffer a substantial inability to perform the essential tasks of her employment as a result of an accident related impairment of function and that she certainly does not currently have the physical capacity to meet the essential demands of her pre-accident work based on the results of a functional abilities evaluation.

[95] However, the chiropractor Tartaglia and vocational rehabilitation specialist Timmons prefaced that remark with the clear words that their opinion was “outside the scope of this assessment”.

Defendant’s Evidence

[96] In response to the Plaintiff’s Affidavit, the Defendant filed extensive Affidavit material of Dan Vaspori, the Defendant’s insurance adjuster retained to handle the Plaintiff’s claim for statutory accident benefits as a result of this accident.

[97] His Affidavit confirmed that he received information from the Plaintiff that at the time of the accident, she was employed as a store manager at Spartan Nutrition and Fitness in Kitchener starting work there in June 2012. He took a statement from her dated August 1, 2012 in which she confirmed she earned $8.00 per hour for about 32.5 hours per week. She confirmed the details of her injury, that she didn’t need any help for her housekeeping tasks and that she was let go from her job two days after the accident due to her lack of product knowledge.

[98] Her application for accident benefits confirmed that she worked for Spartan’s for 11 weeks before the accident earning $2445.

[99] Mr. Vaspori arranged for an assessment of the Plaintiff with an Occupational Therapist Joseph Pest whose report, also unsworn, of August 14, 2002 confirmed her part-time position as a store manager consultant at Spartan Nutrition.

[100] A further report from Mr. Pest of March 12, 2003 received in April by Mr. Vaspori included information that Mr. Pest had learned that the Plaintiff had started working on a part-time basis as a personal trainer at a gym.

[101] An independent medical assessment report of the Plaintiff by Dr. Friars dated January 3, 2003 confirmed that the Plaintiff had advised him that she was working out at a gym six days a week as of early January 2003 as well as attending a physiotherapist three days a week. She reported being very active in working out extensively prior to the accident and still remained extremely active working on her strength. She did aerobic training daily on the bike followed by muscle workouts.

[102] Mr. Vaspori indicated that as a result of his discovery that the Plaintiff had returned to work, he met with her on April 3, 2003 when she confirmed that she had obtained a part-time job as a personal fitness trainer since March 11, 2003. Mr. Vaspori advised her that she would have to declare all her post-accident income that she had received from this employment as it would be deductible from her IRBs that she been receiving from the Defendant. He then forwarded to her the appropriate form for her to fill out.

[103] His evidence was that during that meeting the Plaintiff told him that she was able to resume her pre-accident working activities. Moreover, at no time did she raise any issue about her ability to return to work or complain about ongoing disability pain or discomfort.

[104] He received the Plaintiff’s declaration of post-accident income on or about April 16, 2003 together with some employment pay stubs which confirmed she was employed at a fitness centre earning $8.00 per hour and approximately $160 weekly

[105] Mr. Vaspori also had Mr. Pest’s updated report of April 10, 2003 which confirmed that the Plaintiff had advised him that she was working two days a week, seven hours each day with an additional four hours on Saturdays as a fitness trainer. This was approximately 18 hours per week whereas the information he had was that before the accident at Spartan Nutrition, she earned $2445 over 11 weeks which meant she worked an average of 27 hours per week.

[106] Mr. Vaspori then wrote to her on April 23, 2003 advising her she no longer qualified for IRB’s as he was aware she had returned to work on a part-time basis as a fitness instructor at a salary equal to what she had been earning before the accident. He also sent her all of the required forms under the SABS including the Notice of Stoppage of weekly benefits OCF – 17 form which clearly notified her that the position of the insurer was that she no longer qualified for IR’s which would cease effective May 6, 2003.

[107] The Plaintiff, in response to that decision, requested a DAC assessment of her entitlement to benefits and Mr. Vaspori then made the requisite referral to the closest DAC.

[108] His evidence is that while the DAC assessment was pending, he received a telephone call from the Plaintiff at which time she indicated she was having financial problems despite the fact she was still in receipt of IRBs from the insurer. She was wondering if there was anything the Defendant insurer could do for her to resolve these problems. Mr. Vaspori indicated to her that rather than proceed with a DAC assessment, it might be possible to approach the Defendant to determine if it was prepared to offer her a lump sum settlement and resolve her claim once and for all. His evidence was that she expressed an interest in that option and therefore he followed up with the Defendant, obtained instructions and then contacted the Plaintiff in July 2003 to discuss settlement.

[109] In the meantime, he continued to follow up with the Plaintiff to request post-accident income information but she did not respond subsequent to her initial provision of information in that regard.

[110] Mr. Vaspori does not dispute that payment of IRB’s ceased as of May 6, 2003 but this was based on all the evidence provided to him including her own evidence.

[111] After receiving instructions from the Defendant to try and resolve the claim, he followed up with the Plaintiff and reached an agreement to settle her claims for benefits in their entirety in exchange for a lump sum payment to her in the amount of $3000. His evidence was that the Plaintiff then subsequently met with an employee of their office on July 14, 2003, signed her Full and Final Release and initialled each page of the settlement disclosure notice which clearly advised her of the consequences of settling her claims for benefits in their entirety. She was subsequently given a cheque for $3000 to complete the settlement.

[112] On review of those documents ,it appears that there is nothing in them that suggests noncompliance by the Defendant of its requirements under the SABS with respect to disclosure of the Plaintiff’s entitlement to benefits in the future under the policy.

[113] He is clear in his evidence that at no time did he pressure her into entering the settlement as the Plaintiff had approached him with a view to trying to settle her claim due to her ongoing financial problems . In his view, the settlement reached in July 2003 was a fair and reasonable settlement of her claims for benefits given her evidence that she had returned to employment and her medical treatment was coming to an end.

[114] He discloses that contrary to the Plaintiff’s suggestion, the Defendant cannot now arrange a disability DAC assessment as they no longer exist in Ontario as of March 2006.

[115] With respect to the Plaintiff’s medical condition, the Defendant in this litigation conducted independent medical assessments of the Plaintiff and also attached to its Affidavit those unsworn medical reports. Again, no proof of notice under the Evidence Act or the Rules was provided to the court.

[116] The first report from Dr. Soric, a physiatrist, dated March 12, 2003 contains the doctor’s opinion that the Plaintiff is not substantially disabled from returning to her pre-accident occupation nor was she suffering from a complete inability to engage in any employment for which she is suited by her education, training or experience which are the applicable SABS tests for entitlement to IRBs.

[117] They further obtained the unsworn report of Dr. David Prendergas, a psychologist, of April 4, 2003 which confirmed that she was not substantially disabled from returning to her pre-accident employment nor was she disabled from any employment for which she is reasonably suited given her education, training or experience.

[118] Lastly, the Defendant attached the unsworn report of Graham Pett, a vocational expert, of April 23, 2003 in which Mr. Pett also provides his opinion that the Plaintiff is capable of resuming her pre-accident employment and that she is also capable of performing other occupations for which she has the appropriate education, training or experience. Hence, she does not meet the required test for entitlement to IRBs under the SABS.

Analysis

[119] There is no need to repeat the applicable law regarding summary judgment motions which is stated in my decision regarding the Defendant’s motion for summary judgment. In my view, on the merits, the Plaintiff’s motion for summary judgment should be dismissed for the following reasons:

[120] The contention of the Plaintiff that she is entitled to ongoing payment of IRBs until such time as a proper disability DAC assessment was conducted, in effect in perpetuity is simply without merit. The decision of the Ontario Court of Appeal in Stranges v. Allstate Insurance Company of Canada 2010 ONCA 457 held that even if it was found that the Defendant might be required to continue to pay ongoing IRBs until the proper disability DAC assessment was conducted, the insured claimant would still be required to prove her claim on the merits i.e. that she was entitled to continued payment of IRBs because of her continued substantial inability to perform the essential tasks of her employment for up to two years after the accident and her inability to perform any occupation for which she had the education, training or experience thereafter.

[121] The decision of Black v. Dominion of Canada 2006 34414 (ON SC), 2006 34414 on which the Plaintiff relies is clearly distinguishable from this case as, unlike that case, the Defendant provided the required Notice of Stoppage of the weekly benefits to the Plaintiff and complied with its obligations to request a DAC assessment when the Plaintiff disputed that stoppage of benefits. That decision also predates the Stranges decision of the Court of Appeal which is binding on me.

[122] In that regard on the merits of this claim, there is a significant lack of detailed evidence on the Plaintiff as to what she actually did by way of work and/or retraining since July 2003 in her Affidavit material. The evidence is clear that she was only working on a part-time basis for 11 weeks in the one year prior to the accident as a manager of a nutrition and fitness store making minimum wage at the time. The evidence put forward by the Defendant at this stage is clear that within a year after the accident, the Plaintiff was working again on a part-time basis making minimum wage and at the time the settlement was entered into and continued to work on a part-time basis thereafter.

[123] In addition, although there is some evidence that the Plaintiff may be suffering from a disability now based on her evidence and on the unsworn evidence of her doctors, there is clearly contradictory evidence from the Defendant’s independent medical assessments that confirms that she was not disabled from returning to her former employment or any other job for which she had the appropriate education, training or experience. The parties have conducted examinations for discovery but I was not advised if there had been cross examinations on the Affidavits filed in this Motion. In any event, I was not provided with transcripts of either.

[124] Accordingly, the court is left with Plaintiff’s unsworn medical evidence and her own that is rather weak with respect to her present disability and alleged continued disability since July 2003 to the present day. Moreover, it is clearly contradicted by the evidence of the Defendant’s adjuster with respect to the information he received from the Plaintiff at the time of the settlement and by the unsworn opinions of the Defendant’s independent medical assessors as indicated above.

[125] In my view, because of that contradictory evidence and the contradictory and unsworn opinions of the medical experts provided to this court regarding the Plaintiff’s alleged disability, it is simply not possible for this Court to properly weigh and assess that evidence or make findings of credibility regarding the circumstances of the Plaintiff’s disability especially without the benefit of any cross-examination of the parties and those experts on their sworn testimony as would be the case if this matter had proceeded to trial. There are unresolved significant issues of fact and law based on the record before me and accordingly, this is not an appropriate case for summary judgment in favour of the Plaintiff as she has not established that there is no genuine issue requiring a trial. Dubois v. Ford Credit Canada Leasing, 2012 ONSC 7311 (S.C.J.); Paul v. Oliver Fuels, 2012 ONSC 978 (S.C.J.).

[126] Moreover, the Plaintiff has provided virtually no specific evidence on this motion for summary judgment as to the details of her post-accident employment and income earned since the date of the settlement of July 2003. That evidence would be relevant to not just the issue of her alleged disability as she admits she was performing part-time work after the accident and she was only doing part-time work before. It would also significantly affect the calculation of her actual entitlement to IRBs. Even if the Plaintiff could provide uncontradicted medical evidence supporting her disability from returning to perform her job or any other job since July 2003, the court, because of the lack of that evidence at this stage, would be unable to make any kind of determination of what the actual income replacement benefits would be, if any, given the Plaintiff’s obligation to deduct the post-accident income earned under the SABS.

[127] As a result, there would be no saving of court time or court resources achieved by considering the granting of a declaration now of the Plaintiff’s entitlement to IRBs because of the obvious need to consider the post-accident income earned by the Plaintiff on both issues in the meantime. There are simply not sufficient details of that employment or the income earned before me which would likely have to be judicially determined in another proceeding anyway. The main purpose of Rule 20 summary judgment motions would not be achieved by this motion on this evidence.

Conclusion on Plaintiff’s Motion

[128] Accordingly, the Plaintiff’s motion for summary judgment is also dismissed on the merits.

[129] If the parties cannot agree on the Defendant’s costs that would normally be payable to it on a partial indemnity basis, the Defendant can make submissions within 15 days of this decision with the Plaintiff to provide her responding submissions within 7 days thereafter.

The Honourable Mr. Justice Robert J. Nightingale

Date: July 16, 2013