Fratarcangeli v. North Blenheim
Guest Author: Nathan Tischler, Campisi LLP
On June 15, 2021, the Divisional Court released its long-awaited decision on three appeals, which all related to whether the Licence Appeal Tribunal (LAT) has the jurisdiction to extend the two-year limitation period for disputing accident benefits claims under the Statutory Accident Benefits Schedule.
The LAT had been releasing inconsistent decisions as to whether it had this jurisdiction, and clarity was required from the appeal court.
In Fratarcangeli v. North Blenheim, the Divisional Court ruled that, consistent with the modern approach to statutory interpretation, the LAT Act must be read broadly to allow for extensions of limitation periods fixed by regulations, which are passed under an Act. The panel noted that s. 7 of the LAT Act, which grants the LAT a discretion to extend limitation periods, is worded in a broad and unlimited manner on its face. It specifically rejected the insurers’ arguments that because other provisions in the LAT Act made reference to acts or regulations, s. 7 must be read as only applying to statutes. The Court found that the principle of textual consistency is not a hard and fast rule, but merely a presumption or an aid to statutory interpretation.
The Court also rejected the insurers’ argument that if the LAT Act allowed for extensions of the limitation period to dispute accident benefits claims, it would have said so explicitly. The panel noted that an argument could just as easily be made the other way, which is that the Legislature chose not to carve out an exception to the general discretion of the LAT to extend limitation periods for accident benefits claims because they did not do so explicitly.
From a policy perspective, the Court noted that if they were to accept the insurers’ arguments that the LAT Act does not give the LAT jurisdiction to extend limitation periods for disputing accident benefits claims, this would have the effect of significantly narrowing the LAT’s jurisdiction. The Court acknowledged that the LAT adjudicates various other kinds of disputes passed under different legislation, in which they have had a longstanding practice of extending other kinds of limitation periods which are fixed by a regulation. A finding by the Court that deprived the LAT of jurisdiction to extend the limitation period for accident benefits claims would have unintended consequences for other statutory schemes, such as for motor vehicle impoundment disputes. The panel specifically stated that the insurers’ view of the legislative purpose underlying the transfer of accident benefits to the LAT as being all about efficiency is too narrow; they found that the LAT is meant to be fair and accessible as an adjudicative body as well as efficient.
The Divisional Court also dismissed the insurers’ arguments stating that the more specific provisions establishing limitation periods under the SABS should prevail over the more general provisions of the LAT Act which permit extensions of limitation periods. The Court held that the statutory canon that a more specific provision is to prevail over a more general provision only applies if there is a true conflict between two legislative schemes which result in an ambiguity. It found no conflict between the SABS and the LAT Act, because the two provisions work together harmoniously; the SABS establishes a default two-year limitation period, while the LAT Act may allow for extensions of that limitation period in circumstances where it is reasonable to do so.
Finally, the Court dismissed the argument of the insurer in the Sheway v. Certas decision, in which they argued that a LAT application was a “notice requiring a hearing”, and so s. 7 of the LAT Act did not allow for an extension of time to file this document. Certas argued that not every LAT application results in a hearing, but the Court held that by that logic, the LAT would not have any jurisdiction at all to extend limitation periods under the LAT Act because it is always possible that a commencing document could lead to resolution of a dispute by some means other than a hearing.
The Divisional Court then looked at whether there was any error of law in the application of the LAT’s jurisdiction to extend the limitation period in the three appeals of Fratarcangeli v. North Blenheim, Reardon v. RSA, and Sheway v. Certas. In the first two appeals, the Court held that the LAT had applied the well established four factor test to extend the limitation period to dispute certain accident benefits, and dismissed the insurers’ appeals. In the last appeal, the Court allowed the appeal by the insured person, and remitted the matter back to the LAT adjudicator at first instance so that she could consider whether to apply her discretion under the LAT Act to extend the limitation period for disputing the accident benefits in question.
The Fratarcangeli v. North Blenheim decision is important for the automobile insurance industry as a whole as it reinforces the Court of Appeal’s decision in Tomec v. Economical that although limitation periods for disputing accident benefits claims are important, they are not to be applied in a rigid and inflexible manner. The decision also confirms that the purpose of the LAT’s assumption of jurisdiction over accident benefits claims is not simply about efficiency; the system must remain fair and accessible. This is especially important for particularly vulnerable insureds, such as persons under disability and minors, who may not have the mental capacity to give instructions to commence an accident benefits dispute within the general two-year limitation period. Although the Court did not elaborate heavily on policy considerations in its reasons, the decision implicitly reaffirms that consumer protection remains an important objective of the accident benefits system, despite the transfer of jurisdiction over disputes to the LAT and the reduction of benefits available under the standard no-fault auto policy.
The Divisional Court’s decision and reasons illustrate that the purpose of having a statutory accident benefits system in this Province is not simply to allow multibillion dollar insurance companies to make a profit, but to provide an effective and meaningful social safety net for injured victims of automobile accidents.
This article was originally published HERE