Aviva Insurance Company of Canada v MacDonald, 2022 NBCA 68

Background

After suffering injuries in a motor vehicle accident, the plaintiff was placed off work and provided with loss of income benefits under Section B of her policy through Aviva.  The plaintiff received these benefits for 104 weeks.  She was subsequently cleared to return to work and did so for the following 13 months, before she was indefinitely placed off work again by her family physician.  The plaintiff applied for a resumption of her loss of income benefits, but Aviva denied her claim.

Trial Decision

At trial, citing Newton v General Accident Assurance Co., 1988 CarswellOnt 707, Aviva argued that if an insurer is able to pursue employment that they are reasonably suited for after the 104-week benefit period has passed, the insurer is no longer obligated to provide additional benefits.  In accordance with the Policy, the plaintiff needed to show that after 104 weeks, her injury from the motor vehicle accident was continuously preventing her from participating in any employment that she was reasonably suited for.

The motion judge’s decision ultimately turned on an interpretation of Clause 4 within the Policy, which stated that a person receiving weekly benefits was not precluded from receiving further payment if they found themselves unable to continue working within thirty (30) days of resuming their employment.

Aviva contended that this provision was only relevant to resuming work during the initial 104-week benefits period.  The motion judge found that this specific interpretation was not clearly stipulated in the contract, and any ambiguity in the contract was to be resolved in favour of the plaintiff.  As such, the plaintiff’s motion for summary judgment in their suit to recover benefits was granted.  Aviva appealed this decision.

Appeal

In assessing Clause 4 of the Policy, the Court ruled that since the insured had been medically cleared to return to their pre-accident employment and in fact returned for 13 months after her initial benefits coverage concluded, she could not be deemed a “person receiving a weekly payment” as contemplated in Clause 4 when she was placed off work after the 13-month return to employment, thus disentitling her from further Section B benefits.

The Court cited the Newton case with approval, noting that this principle was applicable whether a plaintiff returns to pre-accident employment or some other suitable occupation after they have received their 104 weeks of indemnity benefits.

Further, the Court stated that this policy interpretation did not penalize insured parties who returned to work for longer than 30 days, as one of the Policy’s main tenets is that an insured has a contractual duty to return to work when they are medically cleared to do so.  It was unreasonable for the plaintiff to argue for the ignorance of Clause 4 in favour of allowing significantly longer periods of work resumption when considering a reinstatement of benefits.

Thus, the motion judge’s decision was deemed incorrect and was set aside, the appeal being allowed with costs payable to Aviva.

Key Takeaways

An insured is not able to resume work for over a year and subsequently seek a continuation of their Section B benefits.  They will be found ineligible for continued indemnity benefits pursuant to the Policy.

Further, this will prove true regardless of whether the claimant returns to their pre-accident position.  Any employment that they are reasonably suited for will be sufficient.

This article was written with contributions by Garett Wollis-Gullett, an articled clerk at Cox & Palmer.