Insured able to apply late for long term disability benefits.

December 05, 2015, Kitchener, Ontario

Posted by: Robert Deutschmann, Personal Injury Lawyer

Date:     2015-09-21


On appeal from the judgment of Justice Marc A. Garson of the Superior Court of Justice, dated January 7, 2015.


Mr. Dube worked for Windsor Essex Community Housing Corporation. In May 2010 he was injured in a car accident, and since then has not returned to work. His employer had a group insurance policy with RBC which provided employees with long term disability benefits. Mr. Dube failed to give notice or proof of his claim within the policy time limits, and when RBC denied the claim Mr. Dube started action against them.


RBC countered with a motion for summary judgment to dismiss the action since Mr. Dube made his claim late. The motion judge refused to dismiss the action and exercised discretionary powers to entitle Mr. Dube relief from the forfeiture of his claim under s. 98 of the Courts of Justice Act. RBC appealed that determination on the basis the judge erred. A single question was to be addressed. Did the motion judge exercise his discretion unreasonably in his application of the three-part test for relief from forfeiture under s. 98?


RBC argued that given Mr. Dube injured himself in May 2010, he ought to have given notice of his claim within 30 days of the accident, and submitted proof of the claim not later than 1 year and 90 days after his claim arose. RBC maintains that it was prejudiced because of its inability to intervene and make its own assessments of Mr. Dube’s condition and requirements for rehabilitation.


The Appeal Court reviewed s. 98 of the Courts of Justice Act which states:


A court may grant relief against penalties and forfeitures, on such terms as to compensation or otherwise as are considered just.


The test for relief is well established and has three components for the court to consider. 

  • the conduct of the insured applicant

  • the gravity of the breach

  • the disparity between the value of the property forfeited and the damage caused by the breach


The motion judge found Mr. Dube’s conduct was ‘not unreasonable’ given his employer supplied him with incorrect information, confusing him about whether coverage existed, and noted that Mr. Dube has completed numerous requests for information. In the matter of the gravity of the breach, the motion judge noted RBC suffered minimal or no actual prejudice due to the breach. On the third point the motion judge found that due to Mr. Dube’s age (43) and the fact his LTD benefits were payable to 65 the disparity of the property forfeited and damage caused by the breach was large.


RBC accepts that the motion judge stated the test for relief correctly. But it submits that he misapplied the second component of the test, in that he failed to properly assess the gravity of the breach. RBC argued the motion judge erred by finding that the length of the breach was only six months and 17 days; and he erred in finding that the actual prejudice to RBC flowing from the breach was minimal or non-existent.

The appeal court judges determined that the motion judge misstated the length of the breach, but the critical question on this component of the test is whether RBC was prejudiced by the length of the breach. The appeal court judges were satisfied that the motion judge did not err in finding that the prejudice to RBC was minimal, and even if RBC incurred some prejudice because it could not conduct its own investigations and medical examinations at an early date, that prejudice was outweighed by the harm to Mr. Dube from his being unable to pursue his claim.


The appeal court judges concluded that the motion judge exercised his discretion reasonably in granting Mr. Dube relief from forfeiture, and dismissed the appeal with costs.

Posted under Personal Injury, Car Accidents, Disability Insurance, Fractures, Treatment

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Deutschmann Law serves South-Western Ontario with offices in Kitchener-Waterloo, Cambridge, Woodstock, Brantford, Stratford and Ayr. The law practice of Robert Deutschmann focuses almost exclusively in personal injury and disability insurance matters. For more information, please visit or call us toll-free at 1-866-414-4878.

The opinions expressed here, while intended to provide useful information, should not be interpreted as legal recommendations or advice.

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