Availability of declaratory benefits one of biggest accident benefits issues of 2008

Out of all of the accident benefits decisions to come out of 2008, perhaps the most significant decision was an Ontario Court of Appeal case that awarded declaratory benefits despite the Statutory Accident Benefits Schedule (SABS).
Kadey B.J. Schultz, a lawyer at Dutton Brock LLP, spoke to delegates of the Ontario Insurance Adjusters’ Association annual conference in Toronto about developments in accident benefits law.
She described 2008 as a “crazy year of sorts in accident benefits defence, not unlike the economy.”
On the insurance defence side, accident benefits were “turned on their head, if you will, with a lot of decisions from the past that had [resulted in] good case law being turned over,” she said. In turn, this created new exposures for different accident benefits that had over the past several years, since Bill 159, become settled case law.
Monks v. ING Insurance Company of Canada was possibly the most important case of 2008, she said.
In Monks, Suzanne Monks was rendered an incomplete quadriplegic following three separate auto accidents. ING Insurance Company of Canada was her auto insurer when the third and final accident took place in 1998.
ING paid Monks’ statutory accident benefits in respect of the third accident for roughly three-and-a-half years, on a without-prejudice basis.
After three and a half years, it terminated any further payments and sought repayment of some payments already made on the basis that Monks was not “catastrophically impaired” within the meaning of SABS. Monks sued ING, claiming declaratory relief and an award of aggravated damages.
One of the key issues going to appeal was whether the trial judge was entitled to grant declaratory relief for future benefits, Schultz said. The Court of Appeal upheld the ruling.
“If we look at the case law prior to the Monks decision, declaratory relief would be available as long as there was a sufficient evidentiary record supporting the need for those ongoing benefits,” Schultz said.
The criteria for an evidentiary record, she continued, include that the case before the court be genuine, not moot or hypothetical and that the declaration must be capable of having some practical effect of resolving the issues in the case.
“This was really important, because in our office we are seeing much more aggressive action taken by plaintiffs’ counsel in asking for a declaration for future benefits, and it’s all because of the Monks case,” she said.
“But nine out of 10 times they [plaintiffs’ counsel] have not read that part of the Court of Appeal’s decision, because there has to be a non-hypothetical situation and it has to be capable of resolving or have some practical effect in resolving the issues in dispute by providing declaratory benefits.”
With this in mind, “it’s really important in adjusting and litigating these claims that we focus on those details because the Court of Appeal, I would suggest, never intended for declaratory relief for future benefits to be available across the board.”
Going forward, at least over the next two or three years, Schultz predicted Monks would lead to an increase in litigation in this respect.