S.H. and H.S. v. Northbridge Personal Insurance Corporation, 2018 ONSC 1801 (CanLII)
The Divisional Court provides guidance on the interpretation of s. 61 of the SABS.
Date Heard: March 15, 2018 | Full Decision [PDF]
This was an appeal of two decisions of Adjudicator Flude of the Licence Appeal Tribunal. The appeal was heard in the Division Court and oral reasons were given by the Honourable Justice Matheson.
Adjudicator Flude granted two applications regarding entitlement to statutory accident benefits. One application was brought by the Respondent Mr. Hussain and the other by the Respondent Mr. Singh (the “Respondents”). The Appellant of both LAT decisions was Northbridge Personal Insurance Corporation.
The proceedings arise out of a collision that occurred on July 12, 2013 in Newfoundland. Mr. Singh was driving a transport truck while Mr. Hussain slept in the sleeper portion of the truck. Mr. Singh claims that he swerved to avoid a moose and lost control. Both Respondents were rendered paraplegics as a result of the collision.
As Mr. Singh and Mr. Hussain were in the course of their employment, they were entitled to benefits under the Workplace Safety Insurance Act. However, they were subsequently informed of a certified class action underway regarding collisions involving moose. The Respondents elected to opt out of their WSIA benefits pursuant to s. 30 and join the class action. The Respondents also applied for and received accident benefits which were paid for over two years.
On September 19, 2014, the class action was dismissed. Northbridge then discontinued the Respondents’ benefits. The Respondents each brought applications before the LAT for reinstatement of their accident benefits. At issue was whether the Respondents elected to pursue a civil action for the primary purpose of receiving accident benefits. If so, the Respondents would have no entitlement pursuant to s. 61 of the SABS. Adjudicator Flude accepted the submissions of the Respondents and the applications were granted.
The Appellant submitted that the Adjudicator erred in law in two ways:
- by holding that the applicable test was whether the election was reasonable, rather than whether the election was bona fide not for the primary purpose of obtaining Statutory Accident Benefits under s. 61(2) of the SABS; and
- by holding that the ultimate dismissal of the class action was not a factor to be considered in the determination under s. 61(2) of the SABS.
The Divisional Court held that the standard of review in relation to the interpretation of s. 61 is reasonableness.
With regard to the first submission, the Appellant argued that the Adjudicator considered only whether the election to pursue a civil claim was reasonable, not whether it was made in bone fide good faith. The Appellant relied on a statement by the Adjudicator setting out that he “must consider whether the election was reasonable”.
The Divisional Court rejected this argument, holding that the Appellant sought to rely on isolated evidence from the Respondents. Matheson J. pointed out that the Adjudicator had made several references to the fact that the appropriate test was one of good faith. Matheson J. also held that the Appellant, in pursuing this argument, essentially sought to undermine the Adjudicator’s findings of fact. In reviewing the steps taken by the Respondents in arriving at their decision to pursue a civil claim, the Adjudicator had made considerable findings of fact. Matheson J. noted that these findings cannot be challenged in this appeal.
Regarding the second submission, the Appellant argued that even if an election was made for a proper purpose, it was only valid as long as there was a law suit underway. In failing to consider the dismissal of the class action lawsuit, the Adjudicator erred in law. The Appellant went on to state that the failure to consider the dismissal of the class action created a result which is contrary to legislative intent that SABS be the benefits of last resort. Finally, the Appellant argued that once the lawsuit ended, the Respondents should have taken steps to move back into the WSIA regime, given that the benefits under the WSIA are better than the SABS. The Appellant argued the Respondents’ failure to take steps to move back into the WSIA regime was demonstrative of the Respondents’ intention to engage with a civil suit for the sole purpose of receiving accident benefits.
The Divisional Court rejected this submission as well. Matheson J. agreed with the Adjudicator in finding that once a bona fide purpose has been found, there is no authority that permits the Adjudicator to vary the determination of the primary purpose based on the outcome of the litigation. The test is whether the decision was bone fide at the time the decision was made. While Matheson J. acknowledged that there were instances where subsequent events would be a relevant consideration in this type of analysis, the present proceedings did not involve such events. Matheson J. went on to conclude that the Respondents’ decisions to remain in the SABS rather than move back into the WSIA was similarly not indicative of bad faith on the part of the Respondents.
The appeals were dismissed.
Read the full decision [PDF]