In Sagan v. Dominion of Canada General Insurance Company, 2013 ONSC 7886, Dominion brought a summary judgement motion before Mr. Justice Lofchik arguing that the plaintiff’s claim for non-earner benefits was statute barred. Additionally, Dominion argued that the plaintiff had not provided any evidence to substantiate his claims in bad faith for damages for mental distress. The Court accepted Dominion’s limitation period argument and found that there was no negligent misrepresentation or bad faith on behalf of Dominion.
A second decision was released with respect to Dominion’s claim for costs: Sagan v. Dominion of Canada General Insurance Company, 2013 ONSC 2245, where the Court awarded Dominion $10,582.75, inclusive of fees, disbursements and taxes in finding that the plaintiff made empty bad faith allegations that Dominion was required to defend.
The plaintiff appealed the summary judgement decision to the Ontario Court of Appeal in Sagan v. Dominion of Canada General Insurance Company, 2014 ONCA 720. He argued that the limitation period with respect to the claim for non-earner benefits began to run once the claim was denied. Dominion argued that the limitation period for non-earner benefits had expired where the plaintiff failed to submit a Disability Certificate (OCF-3) within two years of receipt of the accident benefits package (including an OCF-1 Application for Accident Benefits) from Dominion.
The Ontario Court of Appeal concluded that plain reading of section 35(2) of the SABSprovided that the Disability Certificate is to be filed with the application for benefits, but that some claims for accident benefits could be considered without the submission of one (for example: a claim for medical or rehabilitation benefits is not contingent on the submission an OCF-3). The Court of Appeal upheld the purpose of definiteness with respect the limitation periods in a first-party context, stating that the statutory regime is designed to ensure timely submission and resolution of claims for accident benefits, and that a claimant cannot delay the start of a limitation period by not submitting a Disability Certificate.
The crux of the decision from the Court of Appeal in Sagan is that if a claimant wants to be considered to receive a “specified benefit” (e.g., income replacement, caregiver, or non-earner benefits), they must submit a Disability Certificate within two years of receipt of the accident benefits package from the insurer. More generally, the Court of Appeal’s decision is in keeping with a trend in the lower courts of refusing to strike down insurers’ limitation period defences – where such defences are properly supported on the evidence – when a claimant belatedly decides to start a claim for a specified benefit, or change their existing claim to a different specified benefit such as inSietzema v. Economical Mutual Insurance Company, 2014 ONCA 111.