From 2010 to 2015, the Appellant’s condition continued to deteriorate until she was ultimately accepted as CAT by Economical. The CAT determination entitled her to greatly enhanced benefits under the SABS. However, when she sought AC and HK, Economical took the position that these benefits were not available, as they had been properly denied in 2010, and more than 2 years had elapsed since that time.
The Appellant applied to the Licence Appeal Tribunal (LAT), arguing that at the time of the denial, she was not yet entitled to the benefits, so the limitation period should not have started to run. The Vice-Chair disagreed, holding that the limitation period was tied to the denial, and therefore was a hard limitation not subject to discoverability. Undeterred, the Appellant sought judicial review at the Divisional Court of the Superior Court of Justice, claiming that the LAT had erred in law. The Divisional Court upheld the LAT decision. As a result, she launched the current appeal.
At the time the Divisional Court held the judicial review, the Supreme Court of Canada’s decision in Pioneer Corporation v. Godfrey (2019 SCC 42) had not yet been published. This decision provides clear guidance on the distinction between hard limitations and those subject to discoverability; Pioneer was central to the Court of Appeal’s overturning of the Divisional Court decision.
As an aside, while the Court agreed that the reasonableness standard of review was appropriate, it affirmed, following the Supreme Court in McLean v. British Columbia (Securities Commission) (2013 SCC 67), that there will be circumstances for which only one reasonable result can be reached, and no degree of deference can alter it.
Justice Hourigan for the Court found that, after Pioneer, the LAT and Divisional Court decisions were unreasonable. Prior case law stood for the principle that a hard limitation will apply when it is tied to an event – in this case, the clear and unequivocal denial of benefits. Pioneer, on the other hand, distinguishes between a limitation period that is contingent upon the accrual of a cause of action or some other event that can only occur when the plaintiff has knowledge of his or her injury (discoverable), and one for which a limitation period starts to run from an event unrelated to the accrual of a cause of action which does not require the plaintiff’s knowledge of his or her injury (hard).
In this case, the Court found that the refusal to pay a benefit was clearly tied to the Appellant’s cause of action. It cannot be treated as independent from the right to dispute it. Therefore, the discoverability principle applied to her claim, and she was not statute-barred from applying for ongoing AC and HK benefits. Finding otherwise would be contrary to the consumer protection purposes of the SABS and would produce the absurd result that the Appellant was disqualified from applying for a benefit specifically reserved for the most seriously injured claimants before she became entitled to it.
The Court flatly rejected Economical’s submission that the Appellant should have disputed the denial based on the possibility that she might one day become entitled to receive ongoing AC and HK, observing:
…courts must be cognizant of the significant disparity in resources between large insurance companies and their insureds, who do not have unlimited resources to bring multiple proceedings, including prophylactic claims based on a future contingency.
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