The Court of Appeal for Ontario in a recent ruling, Jakupovic v. Intact, reversed the Divisional Court’s decision in Hussein v. Intact Insurance [*this is the preceding Divisional Court decision where the first and last name were reversed arising from the LAT reconsideration decision], which found that a claim for accident benefits made nearly two years after a motor vehicle accident satisfied the notice requirement in section 32(1) of the SABS. The Court of Appeal ruled decisively that the Divisional Court erred in its interpretation of section 32(1) by failing to adhere to well established principles of statutory interpretation. The Court of Appeal upheld the LAT’s finding that the late claim at issue in the case failed to comply with section 32(1) of the SABS, and agreed with the LAT that the claim was barred from proceeding.
Section 32(1) of the SABS states that a person who intends to apply for accident benefits “shall notify the insurer of his or her intention no later than the seventh day after the circumstances arose that give rise to the entitlement to the benefit, or as soon as practicable after that day.”
In Jakupovic, the insured was involved in a motor vehicle accident on February 13, 2019. The following day, he reported to his insurer the accident and the “heavy damage” to his vehicle, but he did not make a claim for accident benefits at that time. Mr. Jakupovic did not notify Intact of his intention to claim accident benefits until nearly two years later, on December 2, 2020 when a paralegal reported Mr. Jakupovic’s injuries to the insurer. He explained the delay was because he did not know he was entitled to accident benefits until he spoke with a paralegal – the reported decisions provide no explanation for why this took nearly two years. Intact denied the claim, stating that it had received late notice that did not comply with section 32(1). Mr. Jakupovic disputed the decision and filed a LAT application. The Tribunal found that Mr. Jakupovic failed to provide proper notice pursuant to section 32(1) and that his explanation for the 17-month delay was “not credible” and barred the LAT application from proceeding. Mr. Jakupovic requested reconsideration of the LAT decision, and the LAT upheld its own ruling.
On appeal, the Divisional Court reversed the LAT decision. It found that Mr. Jakupovic complied with the notice requirement in section 32(1) when he first reported the accident to Intact. At that point in time, the Court reasoned, it was incumbent upon Intact to ask Mr. Jakupovic whether he had sustained any injuries from the accident and to provide him with necessary forms to apply for accident benefits. The Court concluded that its interpretation of section 32(1) “fosters the consumer protection purpose of the SABS.”
The Court of Appeal unanimously overturned the decision. Justice Darla Wilson, writing on behalf of the Court, found that the Divisional Court erred by failing to follow the Supreme Court of Canada’s guidance for statutory interpretation, as set out in Rizzo & Rizzo Shoes Ltd. (Re), and recently affirmed in its ruling this year in R. v. Nguyen: “It is the meaning of the provision of the statute and its clarity that is at issue, informed by its text, context and purpose.” Here, by focusing its analysis on the consumer protection purposes of the SABS, instead of plain meaning, context and purpose of the SABS, the Divisional Court’s interpretation distorted the actual words of the statute which were plain, clear and mandatory. As the Court of Appeal wrote:
- [20] … The Divisional Court’s interpretation would equate reporting involvement in a motor vehicle accident with reporting injuries and an intention to claim SABS. If the legislature meant that simply reporting involvement in an accident was sufficient notice to an insurer that a claim for SABS was being made, it could have said that.
- [21] Instead, the legislature has made a clear distinction between notice that an incident has occurred and notice of intention to claim benefits. This distinction is illustrated by s. 258 of the Insurance Act. Pursuant to s. 258.1(1), an insured “shall give the insurer written notice of the incident” where they intend to make a claim under their insurance contract or where the accident was required to be reported to the police. Section 258.3(1) sets out the preconditions for commencing an action for loss or damage arising from the operation of an automobile. Section 258.3(1)(b) specifies that prospective plaintiffs must have served “written notice of the intention to commence an action…”. It follows that the legislature intended that notice of an accident be understood as distinct from notice of intention to take an action.
- [22] The interpretation of the Divisional Court reverses the trigger under the statute and requires insurers to initiate accident benefits claims for every accident that is reported regardless of whether the insured sustained injuries. That, in my view, would lead to an absurd result, which Rizzo cautions against: at para. 27.
The Court of Appeal also went on to find that the Divisional Court erred by making certain findings of fact, instead of properly restricting itself to questions of law. It found that the Divisional Court substituted the LAT’s factual findings for its own when it decided that the 7 day notice period was “very short”, that claimants were “in a vulnerable position” and that they would not be familiar with the SABS, all of which was not within the evidentiary record on appeal. It also found that the Divisional Court referenced medical evidence that post-dated the LAT decision, which was also not part of the evidentiary record before the appellate court.
Jakupovic is an important decision guiding how the courts and litigants should properly interpret the provisions of the SABS. It reaffirms the principle that the plain and common sense meaning of statutory provisions are paramount, and the provisions are to be followed without substituting meanings for the language that were not intended by the Ontario legislature. The Jakupovic decision also removes an obligation imposed on the insurer to initiate claims for accident benefits. It avoids the potential uncertainty of whether an insurer has asked enough questions or the correct ones of the insured to trigger accident benefit claims, by placing the reporting onus on the insured as the language of section 32(1) requires.
Jonathan White is a member of the LAT practice group and author of this blog. If you have a question about this decision or a similar file, please contact Jonathan at [email protected]
