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Oct 15, 2018

Ont. Div. Ct. dismisses judicial review application appealing LAT adjudicator’s finding that failure to elect a benefit precluded claimant from seeking entitlement to Non-Earner Benefits at the LAT

Posted in Accident Benefits

Author Bevin Shores

In Lefebvre v. Aviva Insurance Company of Canada, 2018 ONSC 5676, a three-judge panel of the Divisional Court dismissed the claimant’s application for judicial review of a Licence Appeal Tribunal adjudicator’s finding that the claimant’s failure to elect a benefit precluded her from seeking entitlement to Non-Earner Benefits at the LAT. The Court’s decision also addressed the issue of whether the claimant’s application for benefits was “complete,” and whether a formal “denial” is required for a claimant to bring an application to the LAT.

The Court summarized the underlying circumstances and decision below at paragraphs 21-23:

“[21]           The Adjudicator found that the OCF-1 confirmed that the Appellant “potentially qualified for both an income replacement benefit and a non-earner benefit.”  This gave rise to the notice of election under s. 35 of the SABS.  The Appellant relied on the OCF-3 and the OCF-18 that had been submitted in 2012, both of which indicated that the Appellant was not employed at the time of the accident and one of which indicated “n/a” in response to her ability to carry on the essential tasks of her employment.  However, those answers did not exclude a potential claim for an income replacement benefit since that benefit was also available if she had been employed 26 of the 52 weeks prior to the accident.  On the OCF-1 submitted by the Appellant, that box had been ticked.

“[22]           The Adjudicator found that the application for benefits was not complete until the nature of the claim and the benefits being sought were identified.  Section 35 of the SABS required the Respondent to give notice and required the Appellant to elect which benefit she wished to receive within 30 days after receiving the notice.  As of the commencement of the LAT proceedings some two years later, the Appellant had not made an election.  The Adjudicator found that “it cannot be said that there is a completed application” until the Appellant made her election.  He therefore found that the Respondent’s obligation to pay or take other steps under s. 36(4) of the SABS had not yet been triggered.

“[23]            The Adjudicator then addressed the question: “What is the impact on this proceeding of the failure to file an election?”  The Adjudicator found that making the election after the commencement of the LAT application circumvented the claims adjustment process.  The Adjudicator found that the application for a non-earner benefit was “void from the start” for failure to make the election before commencing the LAT application.   However, the order was worded differently.  On the first issue, the Adjudicator ordered as follows:

The application for a non-earner benefit is dismissed without prejudice to the applicant bringing the application before the Tribunal once the respondent has issued its decision…”

The claimant raised three issues for judicial review:

  • Whether the LAT erred in law in its ruling on what constituted a sufficiently complete application for benefits, failing to find that there was an application in 2012;
  • Whether the LAT erred in law in requiring that the Appellant make an election; and,
  • Whether the LAT erred in law in its order requiring that the Appellant await the Respondent’s “decision” before bringing another LAT application.

Regarding the first issue, the Court stated at paragraphs 30-31:

“[30]           In essence, the Appellant is asking us to re-examine the facts as set out on the various forms and reach a different factual conclusion.  That is beyond the scope of this appeal, which is limited to questions of law.

“[31]           In the Decision, the Adjudicator ruled that “the application is not complete until the nature of the claim and the benefit being sought are identified.”  Taken in the context of the need for an election under s. 35, this is not materially different from the above ruling in ING.  In accordance with s. 35, the insurer needed to know which of those alternative benefits the Appellant was electing in order to begin the process of adjusting the claim for that benefit.”

As to the second issue, the claimant had also argued that no election was required at all, however the Court disagreed, explaining at paragraphs 34-35:

“…The Appellant submits that the caregiver benefit is not available, and the Appellant was never eligible for the income replacement benefit.  The submission before us is that despite s. 35(1), no purpose was served by the Appellant making an election and to require an election was an error of law.  This is contrary to both the factual findings made by the Adjudicator and the express words of the section. 

“[35]           The Adjudicator made a finding that the Appellant may qualify for the income replacement benefits or the non-earner benefit based on the forms completed.  Given that finding, s. 35(1), on its plain language, was invoked.  There was not an error in law in requiring that the Appellant elect which benefit she wished to receive under s. 35(1).”

With respect to the third issue, the Court discussed the issue of what circumstances may enable a claimant to bring an application at the LAT:

“[41]           The Appellant’s issue arises if the reference to a “decision” means that there must be a denial of benefits before a claimant can go to the LAT.  That is certainly the Respondent’s position.  However, that is not what the order says and to interpret it that way would be very problematic.  It would place control over access to the LAT in the hands of the insurer and permit an insurer, through bad faith conduct such as deliberate delay, to prevent or wrongly delay access to the LAT.   

“[43]           The order must be read in context.  The Adjudicator did not order that the Appellant had to wait until there was a denial of the non-earner benefits, despite being invited to do so by the Respondent.  As for the meaning of “decision” in the order, the SABS specifically provide for the next steps, as set out in s. 36.  That section provides different courses of action that an insurer must decide between.  Many points of decision follow depending on the course of events.  The Adjudicator did not discuss what could constitute a decision after an election, nor did he deal with delay, when delay would amount to a denial of benefits or how bad faith should be addressed.  Bad faith was not at issue.  The application before him turned, in his view, on whether the failure by the Appellant to make an election before commencing the LAT application meant that there was not yet a dispute.

“[44]           Read in context, the Adjudicator’s order only required that there be some decision by the Respondent that was being challenged by the Appellant before there was a dispute.  That would include a denial of benefits, but might also include all manner of decisions called for under the SABS and could include implied decisions through delay or other conduct.  The order does not require that the decision be a formal denial of benefits.  Whether subsequent events are sufficient to constitute a dispute can be addressed at the time, on the facts, as they may arise.”

In the result, the application for judicial review was dismissed.

Lefebvre v Aviva 2018onsc5676

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Bevan Shores

Bevin Shores

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