



COURT OF APPEAL FOR ONTARIO

CITATION: Bonaccorso v. Optimum Insurance Company Inc., 2016
    ONCA 34

DATE: 20160114

DOCKET: C60473

Cronk, Tulloch and van Rensburg JJ.A.

BETWEEN

Julie Bonaccorso

Appellant

and

Optimum Insurance Company Inc.

Respondent

Daniel Roncari, for the appellant

Amanda M. Lennox and Rebecca J. Brown, for the
    respondent

Heard: January 4, 2016

On appeal from the order of Justice H.S. Arrell of the Superior
    Court of Justice, dated April 24, 2015, with reasons reported at 2015 ONSC 2633.

ENDORSEMENT

[1]

The appellant appeals the order of the motion judge on a summary
    judgment motion dismissing her claim for income replacement benefits.

[2]

On February 4, 2008, the appellant was injured in a motor vehicle
    accident. She received income replacement benefits from the respondent until
    June 28, 2009, when she returned to work.

[3]

The respondent sent a letter to the appellant on June 22, 2009, advising
    that no further benefits would be payable once she began full time work.

[4]

On February 8, 2010, the respondent further advised the appellant by
    letter that her income replacement benefits were being discontinued effective
    June 28, 2009. This February 8, 2010 letter was accompanied by an explanation
    of benefits. It contained a description of the step-by-step process to dispute
    the refusal and a bolded warning that there was a two-year time limit from the
    date of the insurers refusal, to arbitrate or commence a lawsuit in court.

[5]

The appellant continued to work until February 15, 2011, when she ceased
    her employment allegedly because of her injuries sustained in the accident.

[6]

The appellant requested a reinstatement
    of income replacement benefits on July 13, 2012. The respondent denied this
    request on July 20, 2012 on the basis that the limitation period to dispute the
    stoppage had expired. The appellant filed for mediation on October 9, 2012 and
    commenced her action claiming income replacement and other benefits on November
    8, 2013.

[7]

The motion judge concluded that the appellants claim for further income
    replacement benefits was statute-barred and granted the respondents motion for
    summary judgment in respect of this claim. He found that the respondents
letter of February 8, 2010 and the accompanying explanation
    of benefits constituted a valid refusal of benefits.
The two-year
    limitation period provided in s. 281.1(1) of the
Insurance Act
, R.S.O.
    1990, c. I.8, and s. 51(1) of the
Statutory Accident Benefits Schedule 
    Accidents On or After November 1, 1996
, O. Reg. 403/96 (the SABS), expired
    on February 8, 2012.

[8]

The appellant submits that the motion judge erred in finding that her
    claim for income replacement benefits was statute-barred. We disagree.

[9]

The motion judge was correct in determining that this was an appropriate
    case for summary judgment. In finding that there was no genuine issue requiring
    a trial with respect to the income replacement benefits claim, he outlined r. 20.04
    of the
Rules of Civil Procedure
, R.R.O. 1990, Reg. 194, and applied
    the principles in
Hryniak v. Mauldin
, 2014 SCC 7, [2014] 1 S.C.R. 87.
    There were no facts in dispute. The motion judge had sufficient material before
    him to make a decision on the merits of the claim, and in particular on the
    defence that the claim was statute-barred.

[10]

The
    appellant argues that the refusal was not effective to start the running of the
    limitation period because it was premature.

[11]

In
    our view, the motion judge was correct to hold that the respondents letter of
    February 8, 2010, advising that income replacement benefits were being
    discontinued, was a refusal of a benefit sufficient to commence the running of
    the relevant two-year limitation period. In reaching this conclusion, the
    motion judge applied, as he was obliged to do, the governing principles
    regarding such a refusal, as set out by the Supreme Court of Canada in
Smith
    v. Co-Operators General Insurance Company
, 2002 SCC 30, [2002] 2 S.C.R. 129.

[12]

The
    motion judge reviewed and quoted from the refusal letter and accompanying
    materials. The respondent clearly discontinued the appellants income
    replacement benefits, explained the process to dispute the discontinuance, and
    set out the two-year time limit in which the appellant could contest the
    decision. The respondent referred to s. 37(2)(d) of the SABS, and enclosed a
    copy. That provision permits the discontinuance of payment of a specified
    benefit (including income replacement benefits) if the insured person has
    resumed his or her pre-accident employment duties. The February 8, 2010
    refusal therefore complied with
Smith
.

[13]

The
    insurers refusal was not premature. The appellant received income replacement
    benefits from the respondent after her accident. A claim had been made and
    benefits were received. Despite the return to work, one single claim arose from
    the accident, as explained by the Appeal Division of the Financial Services
    Commission of Ontario in
Ladhar v. Economical Mutual Insurance Co.
,
    2012 CarswellOnt 5805, at para. 20. The insurers letter of February 8, 2010
    was a valid termination of benefits and the two-year limitation period began to
    run on this date.

[14]

The
    appellant argues that the motion judge erred in not considering the impact of
    s. 11 of the SABS. Section 11 provides for a temporary return to work without
    affecting the right to resume receiving income replacement benefits, if as a
    result of the accident, the insured is unable to continue in the employment. Therefore,
    the appellant argues, her claim for these benefits only crystallized when she
    stopped working in February 2011. Section 11 of the SABS states:

11.
A person receiving an income
    replacement benefit may return to or start an employment at any time during the
    104 weeks following the onset of the disability in respect of which the benefit
    is paid without affecting his or her entitlement to resume receiving benefits
    under this Part if, as a result of the accident, he or she is unable to
    continue in the employment.

[15]

The
    motion judge was alive to this issue. Though he did not explicitly analyse the
    effect of s. 11, he found that this courts decisions in
Haldenby v.
    Dominion of Canada General Insurance Co.
(2001), 55 O.R. (3d) 470, and
Wadhwani
    v. State Farm Mutual Automobile Insurance Company
, 2013 ONCA 662, [2013]
    O.J. No. 4972, provide a complete answer to the appellants limitations argument.
    We agree.

[16]

Haldenby
and
Wadhwani
dealt with income
    replacement benefits claims asserted after a temporary return to work. In both
    cases, an insured who had received income replacement benefits that were
    terminated claimed the resumption of such benefits after an attempted return to
    work. This court held that the limitation period ran from the insurers refusal
    to pay benefits, notwithstanding that the insured had suffered no actual loss
    in the interim period.

[17]

Part of the courts analysis in
Haldenby
depended
    on the wording of the relevant SABS provisions, which have since changed: see
    paras. 21-27 and 29-33. But the court also observed that the insureds argument
    based on the return to work provision (which is also made here) would extend a
    claimants entitlement to benefits for an indeterminate period of time, and
    would be inconsistent with the need for finality, certainty and the principle
    of diligence underlying limitation periods: see paras. 35 and 36.

[18]

This reasoning was followed in
Ladhar
, which
    analyzed the differences in the SABS wording. And both
Haldenby
and
Ladhar
were approved and followed by this court in
Wadhwani
.

[19]

Accordingly,
    the applicable limitation period did not begin to run only when the respondent
    refused to pay the further income replacement benefits claimed by the appellant.
    Rather, the two-year limitation period commenced in February 2010 when the
    insurer exercised its rights to terminate such benefits and provided a valid
    refusal of benefits. Simply put, the temporary return to work provision does
    not prevail over the limitation period:
Haldenby
, at para. 36;
Ladhar
,
    at para. 24.

[20]

For
    these reasons, the appeal is dismissed. Costs to the respondent, as agreed
    between the parties, in the sum of $5,500, inclusive of disbursements and all
    applicable taxes.

E.A. Cronk J.A.

M. Tulloch J.A.

K. van Rensburg J.A.


