The recent case of Haines v. Aviva Insurance Company of Canada, 2021 CanLII 53157 (ON LAT), deals with a situation where the applicant was involved in a motor vehicle accident on February 4, 2016. At the time, the Statutory Accident Benefits Schedule – Effective September 1, 2010, O. Reg. 34/10 (the “SABS”) stated that insureds were only eligible for attendant care benefits beyond the 104-week mark if they were catastrophically impaired. While this is not the law for accidents occurring on or after June 1, 2016, this decision has important broader implications.
Aviva paid the applicant pre-104 attendant care benefits for the period of March 31, 2016 to November 13, 2016. It terminated them as being not reasonable and necessary thereafter via letter, dated November 6, 2016. On January 7, 2020, Aviva accepted the applicant as catastrophically impaired (“CAT”). Shortly thereafter, on February 13, 2020, the applicant applied for post-104 attendant care benefits by submitting an Assessment of Attendant Care Needs (a “Form-1”). On March 10, 2020 Aviva refused to pay for the benefit, relying on its earlier November 6, 2016 denial letter.
Section 56 of the SABS creates a limitation period of two years for an applicant to apply to the Licence Appeal Tribunal after being denied a benefit.
In this case, Vice-Chair Jesse A. Boyce held that the applicant’s claim for post-104 attendant care benefits was not statute-barred by s. 56 of SABS. He relied largely on the recent decision of Tomec v. Economical Mutual Insurance Company, 2019 ONCA 882. In that case the Ontario Court of Appeal held that the two-year limitation period for accident benefits (formerly established by s. 281.1(1) of the Insurance Act and s. 51(1) of the SABS) is governed by the discoverability principle, rather than a hard limitation period and that “the refusal to pay a benefit and the ability to make a claim are inextricable intertwined in the cause of action”.
In Haines, Vice-Chair Boyce thus found that Aviva’s denial of pre-104 attendant care benefits did not start the two-year limitation period clock for post-104 attendant care benefits. Rather, he held, the limitation period for post-104 attendant care benefits could not start to run until after the applicant became eligible for them. The applicant did not become eligible for them and could not apply to the LAT for them until he was declared CAT and he submitted his post-CAT form 1—neither of which happened until 2020.
Aviva argued that the limitation period started running with the November 6, 2016 denial letter because that denial did not rely on the assertion that the applicant was not CAT, but rather, on the contention that at the time of the denial, attendant care benefits while available to the Applicant under the SABS, were not reasonably necessary on the evidence presented at the time. Thus, Aviva argued that its denial was substantive rather than “pre-emptive”.
Vice-Chair Boyce rejected this argument, reasoning that to accept it would require the applicant to have appealed Aviva’s denial of pre-104 attendant care benefits to the LAT in order to insulate himself against a potential future denial of benefits that he was not yet eligible to claim: post-104 attendant care benefits. He continued that “[t]his is the absurdity that Tomec addresses”.
Aviva also argued that the applicant cannot be said to have only “discovered” his claim in 2020. It explained that his condition must have improved between his applications for pre- and post-104 attendant care benefits as he claimed less per month for the latter. Vice-Chair Boyce rejected this argument as well, reasoning that Aviva declared the applicant to be CAT in 2020 and that “[t]o argue that discoverability somehow does not apply on these facts is disingenuous”.
Vice-Chair Boyce also found, in obiter, that, even if he had not followed Tomec, he would have used his discretion under s. 7 of the LAT Act to extend the limitation period anyways. He reasoned:
First, it was impossible for the applicant to have a bona fide intention to appeal the denial of a benefit for which he was not eligible. However, he did intend to pursue his CAT determination within the limitation period.
Second, the applicant’s delay in applying to the LAT was not four years. Rather, he applied to Aviva for post-104 attendant care benefits within five weeks of Aviva declaring him CAT and applied to the LAT within one month of Aviva’s denial of post-104 attendant care benefits.
Third, there is limited prejudice to Aviva as (1) it conducted a slate of recent CAT assessment, which would provide evidence of the applicant’s attendant care needs and (2) the post-104 Form-1 is not seeking attendant care benefits retroactively.
Finally, it is obvious that the applicant’s claim has merit based on his CAT designation and Form-1 recommending $1,721.85 in attendant care benefits.
It is perhaps most noteworthy on the facts that there were no attendant care arrears being claimed from the date of the initial denial in November 2016, but rather, only from the date of declaration of CAT in January 2020. Had a claim been advanced for further attendant care within the initial 104 week period (under the pre-2016 SABS amendments) it would have been interesting to see if Adjudicator Boyce would have barred those claims, where Tomec arguably would have no application as the discoverability principal would not have applied to that time frame.
If an insurer wishes to rely on a limitation period for post-104 attendant care benefits, it should issue a denial letter specifically relating to post-104 attendant care benefits, even if it has already issued an earlier denial letter for pre-104 attendant care benefits.
More broadly, in applying Tomec to benefits that might have otherwise still been available even without a catastrophic declaration, if an insurer wants the LAT to enforce a limitation period for such a benefit, the insurer should not rely on a denial letter that was issued before the applicant became eligible for additional catastrophic level coverage.
Alexander Dos Reis is a member of the Simplified Procedure and Licence Appeal Tribunal (LAT) practice groups, and is the author of this blog. If you have a question about this decision or a similar file, please contact Alexander at 416.777.2811 ext. 5225.