Funk v. Blue Cross Life Insurance Co. of Canada et al., (2015) 322 Man.R.(2d) 172 (QB)

• Judge: Dewar, J.
• Court: Court of Queen's Bench of Manitoba (Canada)
• Case Date: November 20, 2015
• Jurisdiction: Manitoba
• Citations: (2015), 322 Man.R.(2d) 172 (QB);2015 MBQB 184

Funk v. Blue Cross (2015), 322 Man.R.(2d) 172 (QB)

MLB headnote and full text

Temp. Cite: [2015] Man.R.(2d) TBEd. DE.009

Peter Funk (plaintiff) v. Blue Cross Life Insurance Company of Canada and Granny's Poultry Cooperative (Manitoba) Ltd. (defendants)

(CI 10-01-69291; 2015 MBQB 184)

Indexed As: Funk v. Blue Cross Life Insurance Co. of Canada et al.

Manitoba Court of Queen's Bench

Winnipeg Centre

Dewar, J.

November 20, 2015.

Summary:

The plaintiff sued under a group disability insurance policy. The policy mandated a "Plan Waiting Period", defined as "12 months of active permanent employment for all Employees; coverage is effective the first day following this period." The plaintiff began work on the evening of August 10, 2008. The records of his employment used August 11, 2008, as his first day of employment. The plaintiff suffered his heart attack on August 8, 2009. According to Blue Cross, the plaintiff was not entitled to coverage. The plaintiff argued that the calculation of 12 months started on August 1, 2008. If there was coverage, Blue Cross argued that the plaintiff was no longer disabled, and had not sustained an affliction covered by the basic critical conditions benefit provision.

The Manitoba Court of Queen's Bench held that the plaintiff was not entitled to coverage, because the Plan Waiting Period had not yet expired. The period began on August 11, 2008, and "12 months" ended on August 10, 2009, the day before the 12 month anniversary of the first day of employment. Had the policy been in effect on August 8, 2009, the Court held that: following the 24 month "own occupation" period, the plaintiff was, and continued to be, totally disabled; and the plaintiff would have been entitled to receive a basic critical condition benefit of $50,000.

Insurance - Topic 1128

The insurance contract - The policy period - Time when policy takes effect - The plaintiff began work on the evening of August 10, 2008 - The records of his employment used August 11, 2008, as his first day of employment - The plaintiff suffered his heart attack on August 8, 2009, a few days before the expiration of the Plan Waiting Period, defined under the group disability insurance policy as "12 months of active permanent employment for all Employees; coverage is effective the first day following this period." - According to the defendant Blue Cross, the plaintiff had no coverage because the Plan Waiting Period had not yet expired - The plaintiff argued that the calculation of 12 months started on August 1, 2008 - The Manitoba Court of Queen's Bench held that the plaintiff was not entitled to coverage - The period began on August 11, 2008, and "12 months" ended on August 10, 2009, the day before the 12 month anniversary of the first day of employment - The language of the policy was unambiguous - A review of the circumstances under which the contract was made did not support the plaintiff's argument that the contract was ambiguous - There was no compelling reason to effectively backdate the commencement of the plaintiff's employment - See paragraphs 10 to 41.

Insurance - Topic 1128

The insurance contract - The policy period - Time when policy takes effect - Two days before the expiration of the Plan Waiting Period as defined by Blue Cross, the plaintiff suffered a heart attack which resulted in his being unable to carry on as a truck driver - The Manitoba Court of Queen's Bench held that the plaintiff was not covered under the group disability insurance policy because the Plan Waiting Period had not yet expired - Further, the agreement between Blue Cross and the employer provided that: "The Policyholder or any participating employer shall not be considered to be the agent of the Company for any purpose under this policy." - That clear statement negated the plaintiff's argument that there was an agency relationship created because of the manner in which the employer handled collecting and reimbursing premiums - The payroll deduction was simply the mechanism utilized by the employer to collect the money that it was obligated to pay to Blue Cross - There was no representation that the collection of the premiums was to trigger the commencement of coverage - Indeed, the evidence suggested the contrary - See paragraphs 42 to 47.

Insurance - Topic 1128

The insurance contract - The policy period - Time when policy takes effect - Two days before the expiration of the Plan Waiting Period as defined by Blue Cross, the plaintiff suffered a heart attack which resulted in his being unable to carry on as a truck driver - The Manitoba Court of Queen's Bench held that the plaintiff was not covered under the group disability insurance policy because the Plan Waiting Period had not yet expired - The court rejected the plaintiff's argument that at common law, a month referred to a "lunar month", or a period of 28 days, as distinct from the notion of calendar months, and that 12 lunar months (or 336 days) would have expired before he suffered his heart attack - "[I]f a party to a contract wishes to rely upon such an outdated concept, there should be some onus on them to demonstrate that the parties intended such usage." - When all of the evidence was looked at, the only logical conclusion was that the parties understood the word "months" to mean calendar months, not "lunar months" as argued, after the fact, by the plaintiff - "A court should not try and strain the language in an agreement to try and solve an unfortunate situation which has been experienced by a plaintiff." - See paragraphs 48 to 61.

Insurance - Topic 3570

Accident and sickness insurance - The contract - Interpretation of terms - Total disability defined - The Manitoba Court of Queen's Bench considered the approach to assessing an "any occupation" disability issue - "In short, the plaintiff must present evidence which if left to stand on its own would prove on a balance of probabilities that the plaintiff met the definition of 'total disability'. In so doing, the plaintiff would need to demonstrate both subjectively and objectively that the plaintiff was unable to work at any position. The insurer could then attempt to rebut the evidence of the plaintiff by pointing to certain occupations which could accommodate the plaintiff's abilities. The onus of proof remains on the plaintiff to satisfy the trier of fact on a balance of probabilities that the plaintiff was unable to perform any of the occupations suggested by the insurer." - See paragraph 79.

Time - Topic 1543

Months - Period stated in months - Calendar month - [See third Insurance - Topic 1128 ].

Cases Noticed:

Progressive Homes Ltd. v. Lombard General Insurance Co. of Canada, [2010] 2 S.C.R. 245; 406 N.R. 182; 293 B.C.A.C. 1; 496 W.A.C. 1; 2010 SCC 33, refd to. [para. 18].

Dodds v. Walker, [1981] 2 All E.R. 609 (H.L.), refd to. [para. 22].

Murray v. Delta Copper Co. Ltd., [1923] 3 D.L.R. 118; 2 W.W.R. 284 (Alta. C.A.), refd to. [para. 24].

Monroe v. Mews, [1937] O.R. 452 (Ont. C.A.), refd to. [para. 25].

Aab v. Jablonski (2001), 157 Man.R.(2d) 114; 2001 MBQB 146, refd to. [para. 26].

Davies v. Zurich Life Insurance Co. of Canada, [1981] 2 S.C.R. 670; 39 N.R. 457, refd to. [para. 39].

Jones v. Trans America Life Insurance Co. of Canada (1996), 181 A.R. 273; 116 W.A.C. 273 (C.A.), refd to. [para. 39].

Anguish v. Maritime Life Assurance Co. et al. (1987), 77 A.R. 189 (C.A.), refd to. [para. 39].

London Life Insurance Co. v. Baker (1987), 77 N.S.R.(2d) 3; 191 A.P.R. 3 (C.A.), refd to. [para. 42].

Bruner v. Moore, [1904] 1 Ch. 305, refd to. [para. 49].

Nudell v. Williams (1865), 15 U.C.C.P. 348, refd to. [para. 50].

Hazen v. Hazen (1854), 8 N.B.R. 87, refd to. [para. 50].

Consolidated-Bathurst Export Ltd. v. Mutual Boiler and Machinery Insurance Co., [1980] 1 S.C.R. 888; 32 N.R. 488, refd to. [para. 58].

Pense v. Northern Life Assurance Co. (1907), 15 O.L.R. 131 (C.A.), refd to. [para. 58].

Verbong v. Great-West Life Assurance Co. et al. (2003), 171 Man.R.(2d) 161; 2003 MBQB 39, refd to. [para. 78].

Campbell v. Canada Life Assurance Co. (1990), 65 Man.R.(2d) 95; 45 C.C.L.I. 73 (C.A.), refd to. [para. 80].

Counsel:

Grant M. Driedger and Mathieu Lafreniere, for the plaintiff;

Candace A. Grammond and David E. Silver, for the defendants.

This action was heard before Dewar, J., of the Manitoba Court Queen's Bench, Winnipeg Centre, who delivered the following judgment, dated November 20, 2015.