



COURT OF APPEAL FOR ONTARIO

CITATION:
Zelsman v. Meridian
    Credit Union Limited, 2012 ONCA 358

DATE: 20120530

DOCKET: C54434

Weiler, Blair and Juriansz JJ.A.

BETWEEN

Francine Zelsman also known as Francine Kerdman also known as Francine Zelsman-Kerdman

Plaintiff (Appellant)

and

Meridian Credit Union Limited and  The Great-West Life Assurance Company

Defendants (Respondents)

David M. Midanik, for the appellant

Scott McTaggart, for the respondent

Heard: May 18, 2012

On appeal from the order of Justice Kendra Coats of the Superior
    Court of Justice, dated September 7, 2011, and reported at 2011 ONSC 1680
    (CanLII).

ENDORSEMENT

[1]

This appeal questions the enforceability of a release clause in an
    agreement between the appellants former employer, the College of Family
    Physicians of Canada (the College) and herself.  The appellant contends that
    the effect of the release, which was for the benefit of a third party, Great
    West Life Insurance (GWL), infringes sections 54 and 57 of the
Employment
    Standards Act,
S.O. 2000, c. 41, (ESA) and that, as a result, GWL cannot
    enforce the clause.

[2]

Sections 54 and 57 of the
Employment Standards Act
(ESA) provide
    that an employer cannot terminate the employment of an employee who has been
    employed for more than three months without giving notice in writing and in
    this case, the required period of notice was a minimum of two weeks. During
    this period, an employer cannot alter any terms and conditions of employment
    and must continue to make whatever benefit plan contributions are required to
    maintain the employees benefits until the end of the notice period. The
    employee cannot bargain away this right to coverage.

[3]

The appellant submits that the effect of waiving her right to receive
    benefits under such coverage is the same as agreeing to waive the right to
    maintain such coverage. The appellant claims that she should not be able to
    circumvent the clear intention of the ESA that the college maintain the
    coverage in place by foregoing her the right to receive the benefit of such
    coverage.

[4]

In addition the appellant submits that the clause in question is
    ambiguous.  Finally, the appellant submits that the motion judge erred in holding
    that GWL could enforce or rely on the terms of the Minutes.

[5]

The facts underlying the appeal and the reasons of the motion judge
    dismissing the appellants application for a declaration that the Minutes did
    not have the effect of releasing any claims she had against GWL are reported at
    2011 ONSC 1680 (CanLII) and we do not propose to detail them here.

[6]

For purposes of this appeal the following is sufficient. The appellant
    was insured for long term disability benefits by GWL under a policy of group
    insurance provided by her former employer, the College (the Policy). Her
    employment with the College was terminated in April 2008; however, her coverage
    under the Policy was continued for a month. In June 2008, the appellant filed a
    claim for such benefits. GWL sought information from the appellant and the
    College, adjudicated the claim for long term disability benefits and rejected
    it in November 2008. It resent the letter to the appellants current address in
    December, 2008.

[7]

In the meantime, the appellant also filed a complaint with the Human
    Rights Tribunal against the College, claiming that her employment was
    terminated on the basis of her disability and as retaliation for seeking
    accommodation.  In August 2009 the appellant entered into Minutes of Settlement
    with the College.

[8]

Article 6 of the Minutes contains the release as set out below.  The
    last sentence of article six, shown in italics, is a handwritten addition to
    the Minutes inserted by the appellants counsel prior to the parties signing
    them.

In consideration of the Respondents' agreement to enter into
    these Minutes, the Complainant acknowledges and agrees that upon payment of the
    amounts set out in paragraph 1 hereof she shall have no further entitlement to
    any further payments or benefits and fully and finally releases and forever
    discharges the College and its past, present and future affiliates, successors,
    assigns, officers, directors, employees and agents, including, without
    limitation, Dr. Bernard Marlow and Great West Life Assurance Company from any
    and all actions, causes of actions, claims, demands or proceedings, whether
    statutory, contractual or common law, arising in any way out of or in relation
    to the Complainant's employment with the College or the cessation of said
    employment, including, without limitation, any and all claims relating to
    wages, hours of work, overtime, vacation pay, holiday pay, benefits (including
    short-term and long-term disability benefits), pension or any other past,
    present or future claims relating to any express or implied right under any
    contract, common law or under any statute or regulation, including, without
    limitation, the
Employment Standards Act, 2000
(Ontario),
Human
    Rights Code
(Ontario) or any other statute or regulation, or any other
    claim which forms part of HRTO File No. 2008-00361-1 or could reasonably have
    formed part of HRTO File No. 2008-00361-1.
This release does not in any
    way affect any claims against Great West Life Assurance Company or benefits
    arising out of policies purchased or premiums paid by the Complainant after
    April 24, 2008.

[9]

After signing the Minutes, the appellant appealed from the denial of her
    claim for long term disability benefits in October, 2009.  In November GWL
    denied her appeal but advised that the decision would be reviewed if there was
    further medical information to be considered.  The appellant submitted a
    further letter from her family physician on February 3, 2010, which led to her
    claim for long term disability benefits being approved on February 10, 2010.

[10]

On
    February 22, after GWL had paid the claim retroactive to August, 2008,
    (following the 105 calendar day waiting period) GWL learned of the 2010
    settlement to which it had not been a party and of the clause in issue.

[11]

In
    the end the appellant brought the application for a declaration that gives rise
    to this appeal.

[12]

The
    appellant contends that the effective date of her disability was April 24,
    2008, during the two week period mandated by the ESA and that her claim
    crystallized at this point. The appellant submits that, by purporting to
    include a release of claims for benefits in the Minutes, the College was in
    effect requiring her to waive her rights to the benefit of her coverage during
    the statutory notice period.

[13]

At
    the time the appellant entered into the Minutes of Settlement in August, 2009,
    she had made a claim for LT disability benefits that had been denied in
    November, 2008.  There is no evidence that GWL was acting in bad faith in doing
    so. Her complaint before the Human Rights Tribunal included a submission that
    she was able to work with accommodation. The appellants submission would
    require us to use hindsight, namely the further evidence submitted by her
    family physician and GWLs decision (without knowledge of the settlement) to
    award her long term disability on February 10, 2010, to conclude that she was
    not able to work and that one portion of the settlement is not enforceable.  We
    cannot do this:  see
Cain v. Clarica Life Insurance Co.
, 263 D.L.R. (4th)
    368 (Alta. C.A.) at para 54.

[14]

The
    College did not deny the appellants right to coverage. Coverage was
    maintained.  The appellant made a claim for benefits within the period of
    coverage and it was initially denied and subsequently allowed. The ESA is
    minimum standards legislation.  It is not benefits legislation. Once the
    appellant was entitled to benefits she could compromise the amount, if any, she
    was entitled to.  The benefit of the coverage was quantified as part of the
    settlement agreement on the basis of the factual situation at the time.

[15]

In
    relation to the appellants final argument, principally set out in its factum,
    namely, whether GWL should be able to enforce or rely on the terms of the
    Minutes, we agree with the very thorough and well-reasoned analysis of the
    motion judge.  GWL is entitled to rely on the Minutes.

[16]

Accordingly,
    the appeal is dismissed.

[17]

Costs
    of the appeal are to the respondent, if demanded, and are fixed in the amount
    of $7000 inclusive of disbursements and all applicable taxes.

Karen M. Weiler J.A.

R.A. Blair J.A.

R.G. Juriansz J.A.


