Kumarasamy v. Western Life – Lengthy Time period Incapacity & Limitation Intervals

Kumarasamy v. Western Life, 2021 ONCA 849 (CanLII) is a vital choice from the Ontario Courtroom of Enchantment that confirms a transparent an unequivocal denial of long run incapacity advantages just isn't required for a limitation interval to start out.  The choice gives clear steering on when a lawsuit have to be commenced. The brief reply is you could have much less time than you thought, so it's best to contact a long run incapacity lawyer as quickly as you watched there could also be an issue along with your declare.

Mr. Kumarasamy was injured in a automotive accident on August 25, 2014. He stopped working attributable to accidents together with persistent ache, melancholy, and anxiousness. He was insured for long run incapacity advantages by his employer’s group plan, and submitted an LTD declare on March 9, 2015. On June 2, 2015, the plaintiff acquired a letter from the LTD insurer stating his file was closed.

In February 2017, the regulation agency helping Mr. Kumarasamy along with his automotive accident declare suggested the LTD insurer it had been retained for the long run incapacity declare as nicely. Further info was requested by the insurer and offered by the legal professionals. The insurer denied the declare once more on June 27, 2017. A lawsuit was issued on June 28, 2019.

In Ontario, most lawsuits have to be commenced inside two years of the date the declare was found. On this case, the authorized continuing was began greater than 4 years after the insurer suggested the declare was “closed”, however inside two years of the second denial on June 28, 2017. There have been a number of exchanges of data between these two dates that recommended there had not but been a transparent and unequivocal denial.

Part 4 of the Ontario Limitations Act, 2002 states:

Except this Act gives in any other case, a continuing shall not be commenced in respect of a declare after the second anniversary of the day on which the declare was found.

The final phrase of that part, “discovered”, is outlined in part 5:

5 (1) A declare is found on the sooner of,

(a) the day on which the individual with the declare first knew,

(i) that the harm, loss or harm had occurred,
(ii) that the harm, loss or harm was attributable to or contributed to by an act or omission,
(iii) that the act or omission was that of the individual towards whom the declare is made, and
(iv) that, having regard to the character of the harm, loss or harm, a continuing can be an acceptable means to hunt to treatment it; and

(b) the day on which an affordable individual with the talents and within the circumstances of the individual with the declare first should have recognized of the issues referred to in clause (a).

Regardless of the comparatively clear wording of sections 4 and 5 of the Limitations Act, 2002, many circumstances have been litigated on the problem of when a declare has been found. In the long run incapacity context, the main focus is usually on (5) (1) (a) (iv); that's, whether or not a lawsuit is an acceptable treatment. Earlier than the Kumarasamy choice, some circumstances held that till there's a clear and unequivocal denial, a lawsuit just isn't an acceptable treatment, and subsequently the declare just isn't found.

The LTD insurer introduced a movement for abstract judgement asking the court docket to dismiss the declare as a result of the lawsuit was commenced greater than two years after it was initially denied.

The Decide dismissed the insurer’s arguments and allowed the declare to proceed, noting the primary denial was not clear and unequivocal. Additional, varied correspondence exchanged after the primary denial and earlier than the second recommended the declare had not been closed with finality.

The movement decide thought-about and relied on different circumstances that discovered till there's a clear and unequivocal denial, a lawsuit just isn't an acceptable treatment:

I'm of the view that neither Mr. Kumarasamy nor an affordable individual would have found {that a} continuing towards Western Life for the denial of the LTD declare was acceptable till June 28, 2017 – the date that the declare was “clearly and unequivocally denied”.

For the reason that lawsuit was commenced on the 2 12 months anniversary of the clear and unequivocal denial, the decide dominated it was not out of time and will proceed.

The insurance coverage firm appealed the movement decide’s choice. The Ontario Courtroom of Enchantment agreed with the insurer that the lawsuit ought to be dismissed for failure to start the lawsuit on time. The choice gives an in depth evaluation of how limitation intervals apply to long run incapacity circumstances.

The Courtroom of Enchantment disagreed {that a} lawsuit solely turns into an acceptable treatment when the insurer clearly and unequivocally denies a declare. Relatively, it held the 2 12 months limitation interval began to run when:

(1) the plaintiff knew incapacity advantages had been payable;

(2) he believed he was entitled to incapacity advantages; and,

(3) he knew the insurer was not paying the advantages.

This reasoning intently follows the Limitations Act, 2002.

Apart from some uncommon circumstances, equivalent to the place an insurer misleads a person to imagine they nonetheless have time, a transparent and unequivocal denial just isn't required for the limitation interval to start.

Long run incapacity legal professionals (each plaintiff and defence) ought to learn your complete Courtroom of Enchantment choice rigorously, however among the key paragraphs from the choice observe:

[28] The central errors made by the movement decide are her conclusion concerning when the respondent should have recognized {that a} loss occurred and her conclusion that the required component of discoverability, present in s. 5(1)(a)(iv), that “a proceeding would be an appropriate means to seek to remedy” the harm, loss or harm, was solely glad when the appellant clearly and unequivocally denied the respondent’s declare. The movement decide doesn't cite any authority for this conclusion, and it's at odds with different authorities, most notably, this court docket’s choice in Thompson v. Solar Life Assurance Firm of Canada, 2015 ONCA 162, [2015] I.L.R. I-5721.

[29] In Thompson, this court docket discovered that there have been two the reason why the injured celebration’s declare was barred. One was that the injured celebration had failed to satisfy the qualifying circumstances of the coverage: at paras. 11-12. The opposite was that the two-year limitation interval had expired as a result of the injured celebration knew of her whole incapacity in August 2008 however didn't start her motion till September 17, 2010: at paras. 13-14. The latter conclusion applies equally to this case. The respondent knew of the importance of his accidents by the top of August 2014. Nonetheless, due to the phrases of the Coverage, the respondent was not entitled to obtain LTD incapacity funds till February 26, 2015. Making use of the Thompson strategy, the limitation interval would have commenced on February 26, 2015, which was the primary day advantages would have been payable had the respondent submitted a well timed software and met the Coverage’s definition of Complete Incapacity. By that point, the respondent knew that he was injured, he believed that he was entitled to long-term incapacity funds, and he knew that the appellant was not making these funds.

[34] The movement decide’s conclusion on this case is at odds with the jurisprudence from this court docket concerning the right interpretation of s. 5(1)(a)(iv), that's, when litigation is an acceptable treatment. It's opposite to the choice in Thompson, as I've already defined. Additionally it is opposite to this court docket’s choice in Nasr Hospitality Providers Inc. v. Intact Insurance coverage, 2018 ONCA 725, 142 O.R. (3d) 561, the place Brown J.A. undertook an evaluation of the present authorities on the right interpretation of s. 5(1)(a)(iv). In doing so, Brown J.A. famous that there are specific circumstances the place the conduct of an insurer could, primarily, toll the limitation interval. He referred to the choice in Presidential MSH Corp. v. Marr, Foster & Co. LLP, 2017 ONCA 325, 135 O.R. (3d) 321, the place Pardu J.A. had recognized two such circumstances: (i) the place the plaintiff relied on the superior information and experience of the defendant, particularly the place the defendant undertook efforts to ameliorate the loss; and (ii) if another dispute decision course of gives an enough various treatment and that course of has not totally run its course. Just like the state of affairs in Nasr, neither of these circumstances come up on this case.

[36] In the long run outcome, there are three potential begin dates for the limitation interval that come up on this case and that may be according to the present jurisprudence. One is February 26, 2015, when the elimination interval required by the Coverage expired and the respondent ought to have began to obtain LTD funds, if he was entitled to them. One other is June 7, 2015, when the respondent would have acquired the appellant’s notification that his declare file had been closed. At that time, the respondent knew that, not solely was the appellant not making funds to him, however the appellant was additionally not going to make funds to him sooner or later. One more is November 8, 2016, when his legal professionals acquired copies of the identical correspondence.

[37] I don't must determine which of those three dates is the precise begin date as a result of the two-year limitation interval handed with respect to all of them earlier than this continuing was commenced on June 28, 2019. The respondent’s declare for LTD advantages beneath the Coverage is subsequently statute-barred.

A missed limitation interval is often a whole and whole defence to an in any other case meritorious declare. In the long run incapacity context, the limitation interval can begin to run as quickly as advantages that ought to be payable should not paid. The notion that there have to be a transparent an unequivocal denial is now not required for the clock to start out.

Lacking a limitation interval can lead to disastrous penalties, so if you happen to really feel you're entitled to long run incapacity advantages, however should not being paid, it's best to search quick authorized recommendation.

Long run incapacity legal professionals on the plaintiff aspect ought to by no means wait to the final minute to concern a declare. There are a number of causes to start out the lawsuit early, particularly now that the dearth of a transparent and unequivocal denial is now not a purpose to delay the beginning of a limitation interval.