Straus v. Aviva; Hann v. Aviva; Dushenko v. Aviva; Messer v. Aviva; Larson v. Aviva; Dexter v. Aviva,  ONSC 4589 (CanLll) before Braid J.
Six Plaintiffs brought actions against their insurer, Aviva, seeking non-earner benefits. Aviva brought motions for summary judgment seeking to dismiss the six actions which were commenced outside the two year limitation period. All were insured by Aviva, as primary insured or as a result of being a passenger in a vehicle that was insured by Aviva. All of the Plaintiffs were injured in motor vehicle accidents in 2004 or 2005. All applied for and received SABS.
The SABS provided for three different types of weekly benefits that an insured may be entitled to receive: IRB, NEB and Caregiver benefits.
Important factual considerations in all of the cases included:
1. The plaintiffs all retained counsel within one year of their respective collisions.
2. Aviva sent an Application Package and the insured person was asked to provide information about his or her status that would allow an insurer to determine which, if any, of the three different types of weekly benefits the insured person may be entitled to.
3. The Application Package did not include a separate informational document providing a written explanation of the benefits as contemplated by section 32(2) of the Statutory Accident Benefits Schedule.
4. Only one disability certificate had ever been completed in each action.
5. Aviva advised the Plaintiffs they were not eligible for the NEB. The two year limit was clearly printed on the denial.
6. None of the Plaintiffs began a court action or a dispute resolution process within two years of the denial of the NEB, though other benefits were mediated through FSCO in the following decade.
7. The Plaintiffs commenced an action approximately seven or eight years after the NEB’s were denied. They provided the Court with no explanation for the delay.
Summary judgement was granted and the actions were dismissed.
In 2004 and 2005, it was generally assumed in the insurance industry that employment precluded receipt of the NEB. In 2012, the Galdamez v. Allstate Insurance, 2010 ONCA 508 (CanLll) decision stated that situations exist were a person might be able to work and qualify for the NEB. In light of that decision, the Plaintiffs sought to argue the denial of the benefits was wrong in law.
However, the Court reaffirmed the two year limitation period starts on the date of a clear an unequivocal refusal. An erroneous reason for the denial does not affect the validity of the refusal for the purpose of section 281.1 of the Insurance Act. As the Court of Appeal stated in Sietzema and reinforced in Bustamante, accepting that the limitation period never began to run for the NEB benefit would defeat one of the primary purposes of the SABS regime, namely, to ensure the timely submission and resolution of claims for accident benefits.
All six actions were statute barred. The limitation in all tolled two years from the date of the denial. All six actions were dismissed.
“Better late then never” is the great untruth of Statutory Accident Benefits. There is a two year window to start the dispute resolution process, even where the basis of the refusal is wrong in law. Early applications prevent disappointment and serve clients well because treatment is obtained in a timely way. It avoids disappointment on summary judgment motions.
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