Monks v. ING Insurance Co. of Canada

• Jurisdiction: Ontario
• Judge: Cronk, Gillese and Watt, JJ.A.
• Court: Court of Appeal (Ontario)
• Citation: (2008), 235 O.A.C. 1 (CA),2008 ONCA 269
• Date: 05 November 2007

Monks v. ING Ins. (2008), 235 O.A.C. 1 (CA)

MLB headnote and full text

Temp. Cite: [2008] O.A.C. TBEd. AP.056

Suzanne Monks (plaintiff/respondent on appeal) v. ING Insurance Company of Canada (defendant/appellant on appeal)

(C43857; 2008 ONCA 269)

Indexed As: Monks v. ING Insurance Co. of Canada

Ontario Court of Appeal

Cronk, Gillese and Watt, JJ.A.

April 14, 2008.

Summary:

After being involved in three motor vehicle accidents in the span of six years, Monks was rendered an incomplete quadriplegic. She suffered from serious medical problems and was confined mostly to bed. ING Insurance Co. of Canada was Monks' automobile insurer when the third accident took place in 1998. At that time, the Statutory Accidents Benefits Schedule - Accidents on or after November 1, 1996 (SABS) under the Insurance Act governed entitlement to no-fault first party accident benefits. ING paid Monks statutory accident benefits in respect of the third accident for about 3.5 years. Thereafter, it terminated any further payments and sought repayment of some payments already made on the basis that Monks was not "catastrophically impaired" within the meaning of the SABS. Monks sued ING, claiming declaratory relief and aggravated damages.

The Ontario Superior Court declared that Monks had suffered a catastrophic impairment as a result of the third accident and that she was entitled to receive from ING the statutory accident benefits to which a catastrophically impaired person was entitled under the SABS. The court also granted specific declarations regarding Monks' entitlement to income replacement benefits, past and ongoing medical, rehabilitation and attendant care benefits, and housekeeping and home modification expenses. In addition, Monks was awarded $50,000 in aggravated damages, plus interest and costs, and her counsel was awarded a $75,000 risk premium. ING appealed. In particular, ING challenged the grant of declaratory relief relating to ongoing accident benefits, the award of aggravated damages and the risk premium.

The Ontario Court of Appeal allowed the appeal in part by setting aside the risk premium. In all other respects, the appeal was dismissed.

Editor's Note: Decisions rendered at trial in this matter are reported at [2005] O.T.C. 514, [2005] O.T.C. 757, [2005] O.T.C. 758, and [2005] O.T.C. Uned. 856.

Courts - Topic 686

Judges - Disqualification - Bias - By trial judge - [See Courts - Topic 691 ].

Courts - Topic 691

Judges - Disqualification - Bias - Reasonable apprehension of bias - Monks was involved in three motor vehicle accidents - The trial judge declared that Monks suffered a catastrophic impairment as a result of the third accident and that she was entitled to receive statutory accident benefits from her insurer at the time of the third accident (ING) - The trial judge granted specific declarations regarding Monks' entitlement to benefits and also awarded Monks aggravated damages of $50,000 - On appeal, ING argued that certain of the trial judge's comments and findings about ING's conduct reflected judicial bias - The Ontario Court of Appeal rejected the argument - The trial judge's disagreement with the submissions advanced by ING did not give rise to a reasonable apprehension of bias - Some of the impugned comments and findings of the trial judge related to the adequacy, timeliness and reasonableness of ING's response to Monks' benefits claims and its decision to terminate benefits and seek reimbursement of benefits already paid - Those were the issues underlying Monks' allegations that ING's conduct justified an award of aggravated damages - To the extent that the trial judge's comments and findings on those issues revealed a negative view of ING's conduct, his criticisms were reasonably supported by the record - They did not constitute judicial bias but, rather, his assessment of the facts supporting an aggravated damages award - See paragraphs 78 to 84.

Damage Awards - Topic 2412

Aggravated damages - Insurers - Monks was involved in three motor vehicle accidents - The trial judge declared that Monks suffered a catastrophic impairment as a result of the third accident and that she was entitled to receive statutory accident benefits from her insurer at the time of the third accident (ING) - In addition to granting specific declarations regarding Monks' entitlement to benefits, the trial judge awarded Monks $50,000 in aggravated damages - The Ontario Court of Appeal upheld the award of aggravated damages - The trial judge had found that: ING did not look after Monks' needs properly, even when her cognitive powers were diminished and she was in a depressive state; some care recommendations were not carried forward by ING; ING's delay in implementing care measures caused Monks physical and emotional damage; ING's sudden termination of Monks' benefits and its demand for reimbursement of approximately $52,600 caused stress and damage to Monks; at about the same time, ING reduced Monks' monthly income replacement benefits by 20% to offset the alleged overpayments; and the funds paid to Monks in respect of needed expenditures prior to her benefits being cut-off were "the bare minimum" - The trial judge indicated that he would have awarded $100,000 aggravated damages but for some delay on Monks' part in renovating her home or choosing to move to another home - In these circumstances, the award of aggravated damages was both reasonable and arguably modest - See paragraphs 116 to 117.

Damages - Topic 596

Limits of compensatory damages - Predisposition to damage (thin skull or crumbling skull rule) - Personal injury - Victim's physical condition - After being involved in three motor vehicle accidents, Monks was rendered an incomplete quadriplegic - The trial judge declared that Monks suffered a catastrophic impairment as a result of the third accident and that she was entitled to receive statutory accident benefits from her insurer at the time of the third accident (ING) - The trial judge found that the material contribution test for causation was satisfied despite Monk's two prior accidents and her pre-existing spinal condition - On appeal, the Ontario Court of Appeal agreed with the trial judge that there was no room for the "crumbling skull" principle in accident benefit cases - Even if the crumbling skull principle could be said to apply to accident benefits cases, its application would not be triggered here - There was no finding by the trial judge that the incomplete quadriplegia to which Monks eventually succumbed would have occurred at some point without the third accident, which would have engaged the crumbling skull principle - See paragraphs 93 to 97.

Insurance - Topic 2945.1

Contribution among insurers - Two or more policies covering same loss - Section 60(2) of the Statutory Accidents Benefits Schedule - Accidents on or after November 1, 1996 (SABS) stated that "Payment of a medical, rehabilitation or attendant care benefit or a benefit under Part VI is not required for that portion of an expense for which payment is reasonably available to the insured person under any insurance plan or law or under any other plan or law" - The Ontario Court of Appeal held that there was nothing in the language of s. 60(2) of the SABS that exempted an insurer from paying accident benefits where the insured was positioned to claim the same type of benefits from another insurer for injuries arising from a different accident - See paragraphs 105 to 107.

Insurance - Topic 2945.1

Contribution among insurers - Two or more policies covering same loss - Monks was involved in three motor vehicle accidents - The trial judge declared that Monks suffered a catastrophic impairment as a result of the third accident and that she was entitled to receive from her insurer at the time of the third accident (ING) the statutory accident benefits to which a catastrophically impaired person was entitled under the Statutory Accidents Benefits Schedule - Accidents on or after November 1, 1996 (SABS) - The trial judge granted specific declarations regarding Monks' entitlement to benefits - Monks had settled litigation against her insurer at the time of the second accident (Zurich) for $1.275 million - On appeal, ING argued that: (i) it should not be required to pay any benefits to Monks until the Zurich settlement monies were exhausted; (ii) the maximum funds available to Monks were equal to a single policy limit for the accident benefit in question; and (iii) it should receive credit for the whole amount of the Zurich settlement funds because those proceeds were "reasonably available" to Monks within the meaning of s. 60(2) of the SABS - The Ontario Court of Appeal saw no basis to interfere with the trial judge's treatment of the Zurich settlement funds - To the extent that there was any overlap in ongoing benefits in respect of injuries suffered by Monks in the second and third accidents, the declarations fashioned by the trial judge took such overlap into account and afforded ING credit for benefits received under the Zurich settlement - The effect of the declarations was to recognize that the limits under both policies were fully available to satisfy proper benefits claims by Monks, subject to the restriction that they could not be drawn down in respect of the same expenditure - See paragraphs 98 to 109.

Insurance - Topic 2945.1

Contribution among insurers - Two or more policies covering same loss - Monks was involved in three motor vehicle accidents - The trial judge declared that Monks suffered a catastrophic impairment as a result of the third accident and that she was entitled to receive from her insurer at the time of the third accident (ING) the statutory accident benefits to which a catastrophically impaired person was entitled under the Statutory Accidents Benefits Schedule - Accidents on or after November 1, 1996 (SABS) - The trial judge granted specific declarations regarding Monks' entitlement to benefits - Monks had settled litigation against her insurer at the time of the second accident (Zurich) for $1.275 million - On appeal, ING argued that: (i) it should not be required to pay any benefits to Monks until the Zurich settlement monies were exhausted; (ii) the maximum funds available to Monks were equal to a single policy limit for the accident benefit in question; and (iii) it should receive credit for the whole amount of the Zurich settlement funds because those proceeds were "reasonably available" to Monks within the meaning of s. 60(2) of the SABS - The Ontario Court of Appeal rejected the argument - The court stated, inter alia, that the fact that ING acquired the Zurich line of business that included Monks' Zurich policy, and the fact that ING was also her insurer in respect of the third accident, was irrelevant to Monks' right to recover accident benefits from both companies - Monks purchased two separate insurance policies, paid premiums on each policy, was afforded coverage under both policies and each policy responded to a different accident - Monks was entitled to look to both insurers for payment of those accident benefits to which she was entitled in accordance with the statutory accident benefits regimes in place when each accident occurred - See paragraph 108.

Insurance - Topic 2945.1

Contribution among insurers - Two or more policies covering same loss - Monks was involved in three motor vehicle accidents - The trial judge declared that Monks suffered a catastrophic impairment as a result of the third accident and that she was entitled to receive from her insurer at the time of the third accident (ING) the statutory accident benefits to which a catastrophically impaired person was entitled under the Statutory Accidents Benefits Schedule - Accidents on or after November 1, 1996 (SABS) - The trial judge granted specific declarations regarding Monks' entitlement to benefits - Monks had settled litigation against her insurer at the time of the second accident (Zurich) for $1.275 million - On appeal, ING argued that: (i) it should not be required to pay any benefits to Monks until the Zurich settlement monies were exhausted; (ii) the maximum funds available to Monks were equal to a single policy limit for the accident benefit in question; and (iii) it should receive credit for the whole amount of the Zurich settlement funds because these proceeds were "reasonably available" to Monks within the meaning of s. 60(2) of the SABS - The Ontario Court of Appeal rejected the argument - The court also rejected ING's contention that the fact that some of the proceeds of the Zurich settlement were placed in a structured settlement operated to reduce ING's benefits liability - See paragraphs 110 to 113.

Insurance - Topic 5062.2

Automobile insurance - Compulsory government schemes - Bodily injury and death benefits - Catastrophic impairment - After being involved in three motor vehicle accidents, Monks was rendered an incomplete quadriplegic - The trial judge declared that Monks suffered a catastrophic impairment as a result of the third accident and that she was entitled to receive statutory accident benefits from her insurer at the time of the third accident (ING) - The trial judge found that the material contribution test for causation was satisfied despite Monk's two prior accidents and her pre-existing spinal condition - On appeal, ING argued that the trial judge erred in applying the material contribution test to determine causation - The Ontario Court of Appeal rejected the argument - ING's effort to disclaim the application of the material contribution test in accident benefits cases was inconsistent with its position at trial - Moreover, the trial judge's application of the material contribution test conformed with a long line of arbitral decisions in which the test had been used to resolve causation issues in accident benefits disputes, including in cases where the claimant suffered from a pre-existing condition before the accident in question - In any event, the evidence could have grounded the application of the "but for" causation test as well as the material contribution test - See paragraphs 85 to 92.

Insurance - Topic 5063.1

Automobile insurance - Compulsory government schemes - Bodily injury and death benefits - Pre or post accident condition (incl. aggravation of) - [See Damages - Topic 596 and Insurance - Topic 5062.2 ].

Insurance - Topic 5071

Automobile insurance - Compulsory government schemes - Bodily injury and death benefits - Deductions - [See all Insurance - Topic 2945.1 ].

Practice - Topic 5656

Judgments and orders - Declaratory judgments - Scope and content - Monks was involved in three motor vehicle accidents - The trial judge declared that Monks suffered a catastrophic impairment as a result of the third accident and that she was entitled to receive from her insurer at the time of the third accident (ING) the statutory accident benefits to which a catastrophically impaired person was entitled under the Statutory Accidents Benefits Schedule - Accidents on or after November 1, 1996 (SABS) - The trial judge granted specific declarations regarding Monks' entitlement to statutory accident benefits, including ongoing benefits - On appeal, ING argued that the declarations concerning ongoing benefits were inconsistent with the SABS accident benefits regime and contrary to law because they ignored the SABS requirements for the payment of accident benefits - The Ontario Court of Appeal rejected the argument - ING's argument was inconsistent with its final position at trial where it conceded the trial judge's jurisdiction to grant declarations regarding ongoing accident benefits, so long as the declarations did not fix the quantum of the benefits - The declarations did not include any quantification of the amount of ongoing benefits - Further, the jurisprudence indicated that declaratory relief regarding ongoing benefits under a statutory no-fault accident benefits regime like the SABS was available in a proper case - See paragraphs 31 to 40.

Practice - Topic 5656

Judgments and orders - Declaratory judgments - Scope and content - Monks was involved in three motor vehicle accidents - The trial judge declared that Monks suffered a catastrophic impairment as a result of the third accident and that she was entitled to receive from her insurer at the time of the third accident (ING) the statutory accident benefits to which a catastrophically impaired person was entitled under the Statutory Accidents Benefits Schedule - Accidents on or after November 1, 1996 (SABS) - The trial judge granted specific declarations regarding Monks' entitlement to statutory accident benefits, including ongoing benefits - On appeal, ING argued that the declarations concerning ongoing benefits were unlawful because they allegedly "sweep aside" the SABS provisions for the determination of benefits claims - The Ontario Court of Appeal rejected the argument - There was no inconsistency between the declarations and the SABS - The trial judge held that the ongoing benefits claimed by Monks were reasonable and necessary having regard to her care requirements at the time of trial - The result of that finding was that Monks was entitled to the ongoing benefits in question subject to proof, in accordance with the SABS, of specific expenses falling within each category of benefits - She would be obliged to substantiate specific expense claims, but would not be required to again establish that the expenses claimed were "reasonable and necessary" - That did not override the requirements of the SABS - See paragraphs 41 to 45.

Practice - Topic 5656

Judgments and orders - Declaratory judgments - Scope and content - Monks was involved in three motor vehicle accidents - The trial judge declared that Monks suffered a catastrophic impairment as a result of the third accident and that she was entitled to receive from her insurer at the time of the third accident (ING) the statutory accident benefits to which a catastrophically impaired person was entitled under the Statutory Accidents Benefits Schedule - Accidents on or after November 1, 1996 (SABS) - The trial judge granted specific declarations regarding Monks' entitlement to statutory accident benefits, including ongoing benefits - On appeal, ING argued that the declarations concerning ongoing benefits were inconsistent with the SABS accident benefits regime and contrary to law because they failed to recognize that an insurer's liability for SABS benefits arose only in respect of expenses "incurred" by an insured - ING argued that the word "incurred" as employed in the SABS required a legal liability for payment or a certainty that the claimed expense would arise - The Ontario Court of Appeal rejected the argument - The courts had rejected a narrow construction of the word "incurred" as used in accident benefits schedules - A broad interpretation of the word "incurred" under the SABS was consistent with the policy objective that accident victims promptly receive the statutory accident benefits to which they were entitled - It also prevented an insurer from benefitting from an insured's lack of financial resources - See paragraphs 46 to 52.

Practice - Topic 7061

Costs - Party and party costs - Counsel fees - Increased or decreased fee (incl. premium) - In his ruling on costs dated September 8, 2005, the trial judge allowed a $75,000 premium to the successful plaintiff's counsel, in addition to the costs awarded to the plaintiff, on account of the risk assumed by counsel in undertaking the case - The Ontario Court of Appeal set aside the risk premium - At the time of the trial judge's ruling, the decisions in Walker v. Ritchie (S.C.C.) and Manufacturers Life Insurance Co. v. Ward (Ont. C.A.) were not available - The court stated that "Those cases held that a risk premium may not be passed on to an unsuccessful defendant as part of a costs award under Ontario's Rules of Civil Procedure as in force today (Manufacturers Life) and at the time costs were fixed in this case (Walker). Accordingly, the $75,000 risk premium awarded by the trial judge cannot stand" - See paragraph 118.

Torts - Topic 54

Negligence - Causation - Test for (incl. "but for" test and "material contribution" test) - [See Insurance - Topic 5062.2 ].

Words and Phrases

Incurred - The Ontario Court of Appeal considered the meaning of the word "incurred" in the Statutory Accidents Benefits Schedule - Accidents on or after November 1, 1996, O. Reg. 403/96, under the Insurance Act, R.S.O 1990, c. I-8 - See paragraphs 46 to 52.

Cases Noticed:

Athey v. Leonati et al., [1996] 3 S.C.R. 458; 203 N.R. 36; 81 B.C.A.C. 243; 132 W.A.C. 243; 140 D.L.R.(4th) 235, consd. [para. 30].

Monachino v. Liberty Mutual Fire Insurance Co. et al. (2000), 131 O.A.C. 235; 47 O.R.(3d) 481 (C.A.), consd. [para. 37].

Solosky v. Canada, [1980] 1 S.C.R. 821; 30 N.R. 380; 105 D.L.R.(3d) 745; 50 C.C.C.(2d) 495, refd to. [para. 37].

Constitution Insurance Co. v. Coombe (1980), 29 O.R.(2d) 729 (C.A.), leave to appeal denied (1981), 35 N.R. 355 (S.C.C.), consd. [para. 39].

Daly v. ING Halifax Insurance Co. (2006), 219 O.A.C. 230; 85 O.R.(3d) 70 (C.A.), refd to. [para. 44].

Belair Insurance Co. v. McMichael (2007), 224 O.A.C. 304; 86 O.R.(3d) 68 (Div. Ct.), consd. [para. 49].

Wawanesa Mutual Insurance Co. v. Smith (1998), 116 O.A.C. 62; 42 O.R.(3d) 441 (Div. Ct.), consd. [para. 49].

MacDonald v. Travelers Indemnity Co. (1987), 60 O.R.(2d) 385 (H.C.), refd to. [para. 49].

Kennelly v. Wawanesa Mutual Insurance Co., [2000] O.F.S.C.I.D. No. 17, refd to. [para. 50].

Hungary (Republic) v. Horvath (2007), 230 O.A.C. 66 (C.A.), leave to appeal denied, [2007] S.C.C.A. No. 604, refd to. [para. 65].

Marchand v. Public General Hospital Society of Chatham et al. (2001), 138 O.A.C. 201; 51 O.R.(3d) 97 (C.A.), leave to appeal denied (2001), 282 N.R. 397 (S.C.C.), refd to. [para. 65].

R. v. R.D.S., [1997] 3 S.C.R. 484; 218 N.R. 1; 161 N.S.R.(2d) 241; 477 A.P.R. 241; 118 C.C.C.(3d) 353, refd to. [para. 65].

Hanke v. Resurfice Corp., [2007] 1 S.C.R. 333; 357 N.R. 175; 404 A.R. 333; 394 W.A.C. 333, refd to. [para. 86].

Pisani v. Simcoe & Erie General Insurance Co., [1994] O.I.C.D. No. 129, affd. [1995] O.I.C.D. No. 201, refd to. [para. 91, footnote 5].

Oleiro v. Commercial Union Assurance Co., [1996] O.I.C.D. No. 152, refd to. [para. 91, footnote 5].

Levey v. Traders General Insurance Co., [1998] O.I.C.D. No. 113, affd., [1999] O.F.S.C.I.D. No. 35, refd to. [para. 91, footnote 5].

Saliba v. Allstate Insurance Co. of Canada, [1999] O.F.S.C.I.D. No. 170, refd to. [para. 91, footnote 5].

Argirovski v. Allstate Insurance Co. of Canada, [2000] O.F.S.C.I.D. No. 56, refd to. [para. 91, footnote 5].

Z v. Dominion of Canada General Insurance Co., [2000] O.F.S.C.I.D. No. 51, refd to. [para. 91, footnote 5].

Todd v. State Farm Mutual Automobile Insurance Co., [2003] O.F.S.C.D. No. 167, refd to. [para. 91, footnote 5].

Walker v. Ritchie et al., [2006] 2 S.C.R. 428; 353 N.R. 265; 217 O.A.C. 374, refd to. [para. 118].

Manufacturers Life Insurance Co. v. Ward, [2007] O.J. No. 4882 (C.A.), refd to. [para. 118].

Statutes Noticed:

Insurance Act Regulations (Ont.), Statutory Accidents Benefits Schedule - Accidents on or after November 1, 1996, Reg. 403/96, sect. 60(2) [para. 98].

Statutory Accidents Benefits Schedule - Accidents on or after November 1, 1996 - see Insurance Act Regulations (Ont.).

Counsel:

Geoffrey D.E. Adair, Q.C., for the appellant;

Peter J.E. Cronyn, for the respondent.

This appeal was heard on November 5, 2007, before Cronk, Gillese and Watt, JJ.A., of the Ontario Court of Appeal. The following judgment of the Court of Appeal was delivered by Cronk, J.A., and was released on April 14, 2008.