Court File and Parties
CITATION: Sharon Todd v. Felton Brushes Ltd. et al., 2016 ONSC 5252
COURT FILE NO.: 11-27871
DATE: 2016-08-30
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Sharon Todd
J. Poproski, for the Plaintiff on April 16, 2015
A. Rudder, for the Plaintiff on August 12, 2016
Plaintiff
- and -
Felton Brushes Ltd., Tony Ponikvar, Andy Henry, Sandra Emery, RWAM Insurance Administrators Inc., and the Co-Operators Life Insurance Company
P. Miehls, for the Defendants, RWAM Insurance Administrators Inc. and the Co-Operators Life Insurance Company on April 16, 2015 and August 12, 2016
R.J. McCloskey and L. Abramovich, for the Defendant, Felton Brushes Ltd. on April 16, 2015
Defendants
HEARD: April 16, 2015 and August 12, 2016 at Hamilton
REASONS FOR JUDGMENT
LOFCHIK J.
[1] This is a motion by the defendants for summary judgment dismissing the plaintiff’s claim against them.
[2] RWAM is a third-party administrator of employee group insurance benefits.
[3] Co-operators is a life and disability insurance company.
[4] This action relates to the plaintiff’s claim for a declaration that the plaintiff is disabled within the meaning of a group policy of insurance issued by Co-Operators and other related damages.
[5] The employees of Felton Brushes Ltd. (“Felton”) were insured under policies of insurance issued by Co-Operators providing long-term disability (“LTD”) benefits and weekly indemnity (“WI”) benefits if they met eligibility requirements outlined in the policies. The coverage for all employees of Felton was terminated on November 30th, 2007.
[6] On or about September 6th, 2005, the plaintiffs submitted a claim for WI benefits to RWAM as a result of alleged injuries sustained by the plaintiff in a car accident on or about July 26th, 2005.
[7] The plaintiff’s claim for WI benefits was approved and such benefits were paid to the plaintiff until November 21st, 2005, being the 17 week maximum period of entitlement for WI benefits.
[8] On or about January 10th, 2006, RWAM wrote to Felton with a copy to the plaintiff, enclosing the forms required for the plaintiff to claim LTD benefits and explaining the process for making the application.
[9] On or about May 5th, 2006, the plaintiff submitted an application for LTD benefits in connection with the alleged injuries sustained by the plaintiff in the car accident.
[10] The plaintiff’s application for LTD benefits was approved. LTD benefits were paid to the plaintiff until she returned to work fulltime on June 26th, 2006.
[11] On or about July 18th, 2006, Co-Operators advised the plaintiff that her disability file was now closed because she returned to work on a fulltime basis on June 26th, 2006. The plaintiff did not contest the closing of her disability file at this time.
[12] During the course of the plaintiff’s claim for disability benefits as set out above, RWAM sent a copy of the “Employee Benefits Plan Booklet” (the “booklet”), prepared in December 2004 to the plaintiff’s lawyer, on December 5th, 2005. The plaintiff’s lawyer had contacted RWAM on November 9th, 2005 and requested certain information and asked certain questions relating to the plaintiff’s claim for disability benefits.
[13] The plaintiff was also supplied with a subsequent version of the booklet created in 2006.
[14] The purpose of the booklet is to summarize the main provisions of the policies. The policies contain the same provisions with respect to notice and proof of claim as referred to in the booklet.
[15] As of December 1st, 2004, the minimum number of hours per week required for benefit coverage under the policies was changed from 24 to 35 hours.
[16] RWAM sent updated employee benefit booklets to Felton for distribution on or about January 10th, 2005 as a result of the amendment to the minimum number of hours required for benefit coverage.
[17] On July 24th, 2007, Felton advised RWAM that the plaintiff commenced working part-time in March 2007 and was only working 20 hours per week. As a result, RWAM retroactively terminated the plaintiff’s benefit coverage under the consolidated policy from March 3rd, 2007, and the plaintiff was not eligible to make a new claim for disability benefits under the consolidated policy.
[18] On July 24th, 2007, Felton wrote to the plaintiff and advised that “...our current benefit plan requires that an employee works 35 hours per week to be eligible for benefits. Due to the fact that you are currently working only 20 hours per week and have been since the 1st of March 2007 you will no longer be eligible for benefits”.
[19] The plaintiff commenced the within action against RWAM and Co-Operators on May 27th, 2011, for a declaration that the plaintiff is disabled within the meaning of the consolidated policy and other related damages, including a claim that Felton and Co-Operators have a longstanding policy designed to keep injured employees from claiming benefits or that all of the defendants conspired to breach their alleged duties to the plaintiff.
[20] The plaintiff alleges in her statement of claim that she continues to suffer damages as a result of the injury she sustained in the car accident.
[21] Under the terms of the policy, the plaintiff was required to provide notice of a new claim for LTD benefits. As stated above, the plaintiff’s previous LTD claim was closed after she returned to fulltime work on June 26th, 2006. Thereafter, the plaintiff continued with fulltime work for more than six months and it is the position of the insurer that any further claim for disability benefits would be considered a new claim under the recurrent provisions of the consolidated policy.
[22] It is uncontested that the plaintiff ceased working at Felton on or about August 1st, 2008 and she failed to apply a second time for disability benefits before this time period or any time thereafter.
[23] It is the defendant’s position that the plaintiff’s claim is statute barred under section 4 of the Limitations Act, 2002, S.O. 2002, c. 24, which reads as follows:
- Unless this Act provides otherwise, a proceeding shall not be commenced in respect of a claim after the second anniversary of the day on which the claim was discovered.
[24] The plaintiff has alleged that she had difficulty working when she returned to work on a fulltime basis in June 2006 and that her difficulties continued when she commenced working part-time March 2007. The defendants argue that therefore the plaintiff “discovered” her claim for disability benefits no later than September 2008 when she ceased working at Felton and that she was unable to make a new claim after she commenced working part-time in March 2007 when her coverage ceased.
Plaintiff’s Position
[25] The plaintiff argues that the issue of summary judgment and the facts relied upon by the defendant are res judicata as a result of the reasons for judgment of The Honourable Madam Justice Carpenter-Gunn on December 12, 2012 on a previous motion for summary judgment.
[26] The plaintiff argues in the alternative that if the court finds that the strict requirements of issue estoppel are not met, then the doctrine of abuse of process to prevent re-litigation of matters is applicable.
[27] The plaintiff further argues that as she was not informed of a right to make an application for benefits under the policy as of March 3, 2007, the date insurance coverage for the plaintiff was terminated due to her working fewer than 35 hours per week and she was not informed of the repercussions of reducing her work hours, no limitation period applies to the within action.
[28] The plaintiff also argues that the defendants conspired to cause economic harm to the plaintiff. The plaintiff argues that Felton and Co-Operators have a long-standing “loss control” undisclosed understanding or claims process, policy, agreement, protocol or standard operating procedure designed to keep injured employees, whenever reasonable possible [sic] from claiming benefits under the policy and that this amounts to an unlawful conspiracy.
[29] The plaintiff argues that the above set out issues arise as a result of her not being advised either by her employer or the insurance company that reduced hours would make her ineligible for benefits under the policy, that she could submit a claim for weekly benefits/total disability benefits as an alternative to reducing her work hours, that instead of advising her of the ramifications of reducing her work hours the defendant insurer instead wrote to the plaintiff on July 24, 2007 and terminated her coverage under the policy due to reduced work hours, and that no inquiries were made by the defendants as to the plaintiff’s possible entitlement to disability benefits as of March, 2007.
[30] The plaintiff’s uncontroverted evidence on this motion is that she would not have reduced her work hours had she been made aware that coverage would no longer be available to her under the policy as a result. The plaintiff has further sworn she would not have been able to continue to work.
[31] The plaintiff also argues that the defendant insurer has failed to comply with s. 98 of the Insurance Act. Section 298 provides as follows:
“1) Except as provided in subsection (2), in the case of a contract of group insurance… an insurer shall issue for delivery by the insured to each group person insured… a certificate or other document in which are set forth the following particulars:
The name of the insurer and a sufficient identification of the contract.
The amount or the method of determining the amount of insurance on the group person insured and on any person insured.
The circumstances under which the insurance terminates, and the rights, if any, upon such termination of the group person insured and of any person insured.
[32] The plaintiff argues that pursuant to the provisions of s. 297 of the Insurance Act, Co-Operators was obliged to pay after termination of the policy any benefits due to the plaintiff arising from the accident that occurred before termination of the contract or benefit provision.
Analysis
[33] The defendant may, after delivering a statement of defence, move with supporting affidavit material or other evidence for summary judgment dismissing all or part of the claim in the statement of claim.
Rule 20.01(3) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (the “Rules”)
[34] The Court shall grant summary judgment if it is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence. In determining whether there is a genuine issue requiring a trial, the Court shall consider the evidence submitted by the parties and the judge may exercise any of the following powers for that purpose, unless it is in the interest of justice for such powers to be exercised only at trial:
(1) weighing the evidence;
(2) evaluating the credibility of a deponent;
(3) drawing any reasonable inference from the evidence.
Rules 20.04(2)(a) and 20.04(2.1)
[35] In Hryniak v. Mauldin and its companion action, Bruno Appliance and Furniture Inc. v. Hryniak, the Supreme Court of Canada unanimously endorsed a more expansive interpretation of Rule 20. It was held that Rule 20 must be interpreted broadly to promote timely and affordable access to the civil justice system. Specifically, it was highlighted that the motions judge should ask whether the matter can be resolved in a fair and just manner on a summary judgment motion. This will be the case when the summary judgment process:
(1) allows the judge to make the necessary findings of fact;
(2) allows the judge to apply the law to the facts; and
(3) is a proportionate, more expeditious and less expensive means to achieve a just result.
Hryniak v. Mauldin, 2014 SCC 7, 2014 S.C.C. 7
Bruno Appliance and Furniture Inc. v. Hryniak, 2014 SCC 8, 2014 S.C.C. 8
[36] On the evidence before me I am satisfied that the role of Felton Brushes Ltd. with respect to the plaintiff’s disability insurance was to place the insurance and then to act as a conduit between the insurer and the plaintiff as far as information is concerned. I have applied the factors referred to in Hryniak v. Mauldin supra, and have come to the conclusion that there is no evidence to support the plaintiff’s claim of conspiracy between Felton and the other defendants. I am also satisfied that there is no common law duty on Felton as employers of the plaintiff to inform her of any matters relating to her insurance other than to pass on information from the insurers.
[37] I find that the plaintiff’s claim against the defendants other than RWAM and Co-Operators cannot succeed and I therefore dismiss those claims.
[38] So far as the plaintiff’s argument that the issues raised in this motion are res judicata or subject to issue estoppel arising from the decision of Madam Justice Carpenter-Gunn dated December 12, 2012 are concerned, at page 9 of her reasons Justice Carpenter-Gunn stated as follows:
At this time, and I underscore at this time, the court is unable to have a full appreciation of the evidence and the issues. Therefore dispositive findings cannot be made by this court. Here, the moving parties have not convinced the court that the full appreciation test is met. The interests of justice require that the case move on to discoveries and full productions and the court is troubled by the fact that the insurance policy in issue has not been provided to the respondent party, nor is it before the court as part of the moving party’s materials before the court. No doubt part of this case will be the issue of this insurance policy’s wording and the interpretation of the insurance policy.
The court finds that this motion is premature. It may be that after discoveries and full productions a renewed motion would properly be brought before the court . …
[39] I find that the only issue decided by Her Honour was that the motion for summary judgment was premature and had to be dismissed at that time. Her Honour contemplated a renewed motion once more facts were available and did not limit what might be raised on such motion. Apart from the decision to dismiss the motion as premature, the other parts of the reasons of Madam Justice Carpenter-Gunn are obiter dicta and do not limit the issues which may be raised on this motion.
See Ashak v. Ontario (Family Responsibility Office), 2013 ONCA 375.
[40] The elements of a claim for conspiracy are:
(1) two or more defendants make an agreement to injure the plaintiff;
(2) the defendants use some means (lawful or unlawful) for the predominant purpose of injuring the plaintiff or use lawful means with knowledge that their acts were aimed at the plaintiff and knowing or constructively knowing that their acts would result in injury to the plaintiff;
(3) the defendants act in furtherance of their agreement to injure; and
(4) the plaintiff suffers damages as a result of the defendant’s conduct.
EnerWorks Inc. v. Glenbarra Energy Solutions Inc., 2012 ONSC 414 at para. 66.
[41] The plaintiff has failed to adduce any evidence on this summary judgment motion to support the allegation of a conspiracy between RWAM and Co-Operators to cause her injury.
[42] The plaintiff is not entitled to merely rely on bald allegations in the statement of claim regarding the alleged conspiracy of the defendants. The court is entitled to assume that the plaintiff has put her best foot forward with respect to this issue and presented all the evidence which she would present at trial in connection with these conspiracy claims.
[43] I find there is no evidence that any of the defendants have entered into any conspiracy to frustrate the plaintiff’s claim for benefits under the relevant provisions of insurance, or that the defendants conspired to breach their alleged duties to the plaintiff. The claim with respect to damages for conspiracy is therefore dismissed.
[44] So far as the claim for disability benefits is concerned, the plaintiff has failed to file any evidence that supports her position that she is entitled to disability benefits or any related claim for damages.
[45] The plaintiff admits that she did not attempt to make a subsequent claim for WI benefits or LTD benefits as required under the consolidated policy after her disability file was closed by Co-Operators on June 26, 2006 upon her return to full-time employment. The policy required that the plaintiff provide written notice of any such claims within 12 months after she first became eligible in order to claim WI benefits or LTD benefits.
[46] Once the plaintiff returned to work on a full-time basis on June 26, 2006 and continued to work full-time for more than six months, any further claim for disability benefits would not be a continuation of her previous claim for disability benefits but rather would be a new claim under the recurrent provisions of the policy. As a result, the plaintiff would be required to provide written notice of a claim and proof of claim to RWAM for WI benefits and proof of claim to Co-Operators for LTD benefits as referred to above. The plaintiff alleges that the limitation period did not commence to run against her as the Co-Operator’s did not advise her of her ongoing rights to make a claim under the relevant policies of insurance when they closed her disability file on June 26, 2006.
[47] However, the Ontario Court of Appeal has confirmed in Reeve v. Co-Operators Insurance Company that there is no common law duty on a group disability insurer to inform an insured of each potential claim for benefits. The plaintiff was aware of her right to and the requirements to submit a claim for disability benefits when she returned to work after her previous claim for disability benefits when she commenced working part-time hours and when her employment was terminated as a result of having been provided with the booklet which set out the summary of policy terms.
[48] At the time the plaintiff alleges that she became “totally disabled” for the second time as a result of the injuries sustained in the accident, she had previous claims of experience with RWAM and the Co-Operators and was represented by counsel and was in possession of the booklet which outlined the claims submission process.
[49] It should be noted that the plaintiff did not have coverage under the consolidated policy for WI benefits or LTD benefits when she commenced working part-time hours, less than 35 hours a week, on March 3, 2007 and that all employees of Felton were no longer covered under the consolidated policy as of November 30, 2007. In order to avoid the running of the limitation period, the plaintiff alleges that no one advised her that she would no longer be eligible to claim for disability benefits working reduced hours commencing March 3, 2007. Based on the information she had, the plaintiff was or should have been aware that she was no longer eligible to claim disability benefits under the consolidated policy beyond March 3, 2007.
[50] There is no evidence that RWAM was advised as of March 3, 2007 that the plaintiff reduced her hours because she was injured or continued to be “totally disabled” as a result of the car accident, nor that the Co-Operators was advised that the plaintiff had reduced her hours and was no longer eligible to make a new claim for disability benefits under the consolidated policy as neither RWAM nor Co-Operators knew that the plaintiff was reducing her working hours to the point where she would not be eligible under the policy of insurance until after she had reduced her working hours and therefore become disentitled to coverage. They were not in a position even if required, to advise her of the fact that she would cease being covered until after she had in fact become disentitled to coverage. In any event, neither RWAM nor Co-Operators received a subsequent claim for WI benefits or an application for LTD benefits from the plaintiff after her disability file was closed by Co-Operators on June 26, 2006.
[51] The first notice that RWAM and Co-Operators had with respect to the plaintiff bringing a further claim is on May 27, 2011 on receipt of notice of the within action for a declaration that she is disabled within the meaning of the policy and other related damages.
[52] The determination of the appropriate limitation period does not present a genuine issue requiring a trial.
West York International Inc. v. Importanne Marketing Inc., 2012 ONSC 6476, para. 83.
[53] Section 4 of the Limitations Act, 2002 S.O. 2002, c. 24 creates a basic limitation period of two years following the discovery of a claim. It reads as follows:
- Unless the Act provides otherwise, a proceeding shall not be commenced in respect of a claim after the second anniversary of the day on which the claim was discovered.
[54] In order to determine if the claim is statute-barred, it must be considered when the plaintiff “discovered” the claim. Pursuant to s. 5(2) of the Limitations Act, 2002:
5(1). A claim is discovered on the earlier of,
(a) the day on which the person with the claim first knew,
(i) that the injury loss or damage had occurred, …
(ii) a person with a claim shall be presumed to have known of the matters referred to in clause 1(a) on the day the act or omission on which the claim is based took place unless the contrary is proven
[55] The plaintiff alleges that she had difficulty working when she returned to work on a full-time basis in March, 2006 and that her difficulties continued when she commenced working part-time in March, 2007. She further alleges that she has not worked in any capacity as a result of her injuries and impairment since she ceased working at Felton in September, 2008. Given these allegations and nature of the plaintiff’s claim for disability benefits, it would be presumed that she “discovered” the within claim for disability benefits prior to her ceasing to work at Felton in September, 2008. The plaintiff has led no persuasive evidence to rebut this presumption. The plaintiff argues that the limitation period did not start to run until Co-Operators and RWAM informed her directly regarding a potential claim for benefits pursuant to a duty to provide such information. She relies upon the decision in Smith v. Co-Operators, 2002 SCC 30, [2002] 2 SCR 129. The Court of Appeal in Reeve v. Co-Operators distinguished the decision in Smith holding that there is no common law duty on a group disability insurer to inform an insured of each individual potential claim for benefits on the basis that the court in Smith based its decision on the fact that the specific language contained in s. 71 of the Statutory Accident Benefits Act obliging insurers to inform claimants of the entire dispute resolution process had not been complied with by the insurer.
[56] In the present case, the only statutory notification provision is s. 298 of the Insurance Act which provides notice to be given to each group person insured under a group insurance policy by means of a certificate or other document in which are set forth the name of the insurer and sufficient identification of the contract, the amount or the method of determining the amount of insurance on the group person insured and on any person insured and the circumstances under which the insurance terminates, and the rights if any upon such termination of the group person insured and any person insured.
[57] Counsel for the defendants argues that s. 298 of the Insurance Act only applies where a contract of group accident and sickness insurance or a benefit provision therein is terminated and the rights to be set out are any rights that arise upon termination of the policy and that provision is not applicable to the circumstances of this case. Here the plaintiff had no rights that arose on termination of the policy.
[58] The plaintiff would not be entitled to such notice when Felton terminated the insurance for all employees on November 30, 2007 as she was no longer an insured under the policy having become disentitled to insurance on March 3, 2007 when she commenced working part-time.
[59] I am satisfied that the limitation period in this case began to run when the plaintiff discovered or ought to have discovered that she was allegedly unable to work full-time as of March, 2007. This action is statute-barred as the plaintiff commenced the action over four years later.
[60] Counsel for Co-Operators and RWAM alleges that they have been prejudiced by not being provided with current medical information at the relevant time, namely March, 2007 and from time to time thereafter. Co-Operators and RWAM have been prevented from regularly obtaining current information from the plaintiff and her treating physicians and consultants on the status of her injury and were denied the opportunity to assess the medical information and conduct their own investigations such as independent medical examinations, functional ability assessments, vocational assessments and surveillance which may have assisted them in determining if the plaintiff’s daily activities were consistent with her reported limitations and restrictions. It is alleged that they have been prejudiced by not having the opportunity to assess whether the plaintiff was receiving appropriate treatment from time to time, whether Co-Operators should provide rehabilitative services and consider the opportunities for gradual or permanent return to work at her former job or some other job for which she was suitable. The case law has held that the expiration of a limitation period raises the presumption that the defendants would suffer real prejudice if the action is allowed to continue.
[61] Based on the foregoing an order will issue dismissing the plaintiff’s action against the defendants with costs.
[62] So far as quantum of costs is concerned, if the parties cannot agree on costs the defendants may deliver written submissions within 20 days consisting of no more than eight pages with the spacing and font required for court documents excluding the summary of time spent and summary of disbursements. The Plaintiff shall have 20 days from the receipt of the defendant’s submission to file reply submissions on the same basis. The defendants are to have five days for any reply upon receiving the plaintiff’s submissions.
LOFCHIK J.
Released: August 30, 2016
CITATION: Sharon Todd v. Felton Brushes Ltd. et al., 2016 ONSC 5252
COURT FILE NO.: 11-27871
DATE: 2016-08-30
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Sharon Todd
Plaintiff
- and –
Felton Brushes Ltd., Tony Ponikvar, Andy Henry, Sandra Emery, RWAM Insurance Administrators Inc., and the Co-Operators Life Insurance Company
Defendants
REASONS FOR JUDGMENT
TRL: co and mw
Released: August 30, 2016