Turner v. State Farm, (2005) 195 O.A.C. 61 (CA)

• Judge: Goudge, Lang and Juriansz, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: January 31, 2005
• Jurisdiction: Ontario
• Citations: (2005), 195 O.A.C. 61 (CA)

Turner v. State Farm (2005), 195 O.A.C. 61 (CA)

MLB headnote and full text

Temp. Cite: [2005] O.A.C. TBEd. FE.017

Deborah Turner (applicant/respondent) v. State Farm Mutual Automobile Insurance Company and The Financial Services Commission of Ontario (respondents/ appellant / respondent )

(C42007)

Indexed As: Turner v. State Farm Mutual Automobile Insurance Co. et al.

Ontario Court of Appeal

Goudge, Lang and Juriansz, JJ.A.

February 7, 2005.

Summary:

An insured claimed entitlement to statutory accident benefits as a result of a motor vehicle accident that occured on June 16, 1993. An arbitrator concluded that the insurer had given clear and unequivocal refusal of benefits on June 19, 1999, and that the insured's application for arbitration filed in June 1999, was out of time. The order was affirmed on appeal to the Director's Delegate. The effect of the order of the Director's Delegate was that the insured's claim for certain disability benefits after June 16, 1996, were dismissed as statute barred (Insurance Act, s. 281(5)). The insured applied for judicial review.

The Ontario Divisional Court, in a decision reported at 184 O.A.C. 186, allowed the application and quashed the order of the Director's Delegate. The insurer appealed.

The Ontario Court of Appeal allowed the appeal, set aside the order of the Divisional Court and dismissed the judicial review application.

Insurance - Topic 5076

Automobile insurance - Compulsory government schemes - Bodily injury and death benefits - Limitation period - An arbitrator concluded that an insurer had given a clear and unequivocal refusal of benefits and the insured's application for arbitration was out of time - The Director's Delegate affirmed the decision with the result that the insured's claim for certain disability benefits was statute barred (Insurance Act, s. 281(5)) - The Divisional Court quashed the order - The cancellation notice had to be clear and unequivocal - The Director's Delegate appeared to apply a different test in her use of the language "substantially clear and unequivocal" and "substantially clear" - Section 24(8) of the Statutory Accident Benefits Scheme required written notice with "the reasons for refusal" - The reasons provided to the insured were incorrect - The insurer had to provide the insured with the real basis for cancellation - The Ontario Court of Appeal allowed an appeal - While adjectives like "substantially" should be avoided, the Director Delegate's reasons left no doubt that she had applied the correct test - Further, s. 24(8) did not require that "the reasons for refusal" be legally correct - The purpose of the requirement was to permit the insured to decide whether to challenge the cancellation - If the reasons provided were legally wrong, a challenge would succeed.

Insurance - Topic 5077

Automobile insurance - Compulsory government schemes - Bodily injury and death benefits - Notice of refusal or termination of benefits - [See Insurance - Topic 5076 ].

Statutes Noticed:

Insurance Act Regulations (Ont.), Statutory Accident Benefits Schedule - Accidents after December 31, 1993 and before November 1, 1996, Reg. 776/93, sect. 24(8) [para. 8].

Statutory Accident Benefits Schedule - Accidents after December 31, 1993 and before November 1, 1996 - see Insurance Act Regulations (Ont.).

Counsel:

Robert S. Franklin, for the appellant;

Jamie R. Pollack, for the respondent, Turner;

Joe Nemet, for the respondent, Financial Services Commission.

This appeal was heard on January 31, 2005, by Goudge, Lang and Juriansz, JJ.A., of the Ontario Court of Appeal. The following decision of the court was released on February 7, 2005.