Top court clarifies standard for judicial review of LAT decisions

Canada’s top court has kicked an auto accident benefits dispute back to the Ontario Licence Appeal Tribunal, effectively confirming courts have discretion to review decisions from the LAT, even if claimants only have a limited right to appeal LAT decisions.

The Supreme Court of Canada also found Friday that the LAT’s 2019 decision in Yatar v. TD Insurance Meloche Monnex was “unreasonable.”

Specifically, it held the LAT must reconsider a question of “mixed fact and law,” even though Ontario’s enabling legislation for the LAT says judicial review should be for questions of law only. The fact still up for review is whether or not TD Insurance’s reinstatement of Yatar’s income replacement benefits (IRB) in February 2011 required the insurer to attach fresh dispute resolution forms to its subsequent denial of those benefits, thus restarting the clock on the two-year statute of limitations.

Ummugulsum Yatar is contesting the denial of her insurance benefits, following an accident in 2010. The LAT dismissed her appeal in 2019, due to the matter being time-barred.

Yatar was injured in an automobile accident in 2010. Her insurer, TD Insurance, initially paid her accident benefits. However, in January 2011, TD informed Yatar by letter that payment of all benefits had been stopped in the absence of a completed disability certificate. A dispute resolution form was attached to the letter.

Then, in February 2011, the insurer informed Yatar that, having received the certificate, and following a medical assessment, her IRBs were reinstated. But her claim to the other two benefits — housekeeping and home maintenance — was denied.

Finally, in September 2011, the insurer informed Yatar that her IRBs were denied and payments would be stopped. No dispute resolution forms were attached to either of the last two letters.

Yatar applied for mediation, which was mandatory at the time, to dispute the denial of her benefits. The mediation process came to an end in January 2014, when the mediator released his report.

Ontario’s Insurance Act includes a two-year limitation period after the insurer’s refusal to pay the benefits to commence a proceeding to contest the denial. It also extends the limitation period by 90 days after the mediator provides a report.

Yatar appealed the insurer’s decision at the LAT in March 2018.

Related: Should you attach a dispute-resolution form to a denial letter?

Among other things, she argued that the two-year statute of limitations started running only after the insurer attached dispute resolution forms to its denial of the reinstatement of her IRB benefits. She argued the insurer was required to do this but didn’t. The insurer argued it didn’t need to, because it had already denied her benefits previously, and a dispute resolution form was attached to that denial letter.

The LAT denied Yatar’s application, saying it was statute-barred.

Yatar applied to have the LAT, Ontario Divisional Court, and Ontario’s Appeal Court all reconsider LAT’s initial decision, and all denied her applications. The lower courts successively found she was attempting to have LAT review her decision based on “a mix of fact and law.”

But Section 11(6) of the LAT Act restricts appeals to questions of law only.

Thus, Ontario’s divisional court and appellate courts found judicial review of LAT‘s decisions on the basis of mixed fact and law could only be made in “exceptional circumstances,” as the divisional court put it, or in “rare” cases, as confirmed by the Appeal Court.

But Canada’s top court said the lower courts were defining their discretion too narrowly; they still had the discretion to review LAT cases, even when there is a limited right of appeal.

“The respondent TD Insurance argues that the legislative scheme and its amendments in 2016 reflects a policy choice by the legislature to severely limit the courts’ involvement in accident benefits disputes,” Supreme Court of Canada Justice Malcolm Rowe wrote for a unanimous court.

“Section 11(6) of the LAT Act restricts appeals to questions of law. . . . For LAT decisions made under nearly 20 other statutes, the legislature has made appeals available on all questions….

“TD Insurance further submits that ‘applying a deferential standard of review (reasonableness) to factual and mixed questions arising out of LAT decisions concerning SABS would not be appropriately respectful of the legislature’s institutional design choices.’

“With respect, I do not agree. The legislature could have decided to encompass all types of errors in the right to appeal, but it did not. Moreover, s. 2(1) of the Judicial Review Procedure Act preserves the right of litigants to seek a judicial review ‘despite any right of appeal.’

“Errors of fact or mixed fact and law, thus, are not subject to a correctness standard of review. With that in mind, proceeding with judicial review of questions of fact or mixed fact and law is fully respectful of the legislature’s institutional design choices.”

Moreover, Rowe found the LAT’s decision in the first instance was “unreasonable.”

“Section 281.1(2)(b) of the Insurance Act and s. 51(2) of the SABS (as they existed at the time) do not trigger a 90-day limitation period from the release of the mediator’s report,” Rowe wrote.

“Rather, they provide for an extension of the two-year limitation period from the mediator’s report. In other words, it is arguable that there still needed to be a valid denial of the IRBs to start the clock running. I do not purport to decide this question; it is one properly to be decided by the LAT.

“The LAT adjudicator failed to take into account relevant legal constraints. In light of this, his decision is unreasonable.”

The Supreme Court thus kicked the matter back to the LAT to rule on when the limitations period started in Yatar’s case.

Feature image courtesy of iStock.com/satori13