Playing Cat and Mouse with Automobile, Long Term Disability & Medical Malpractice Litigation
TIP #1:
SEVERANCE PAY IS NOT ALWAYS AN OFFSET
Offsets are payments from third parties that reduce the LTD benefit, usually WCB, CPP, other LTD plans, or part time employment earnings. The wording of the off set provisions in the policy determine whether severance pay will be deducted from LTD benefits. Some policies reference “severance payments” directly. In most policies, however, severance falls under "other income from all sources" in the offset clauses. The issue then is whether or not severance pay is considered "income" or a capital asset.
In Henderson v. Canadian General Life Insurance Co. 17 O.R. (3d) 154, the Ontario Court explains that severance pay is considered to be capital at common law, and not income. The court relied on Elliott v. Ontario [1973] 2 O.R. 534. The court found that "earnings from employment" did not include severance pay because it was not a reward for labour and was not a continuation of employment. Rather, it was a payment for loss of office. The court concluded that, if the insurer wished to deduct severance pay, it should have made it clearer.
If your client has been awarded severance, and if the policy does not specifically reference severance, you have a good argument that it should not reduce the LTD benefit.
TIP #2:
OBTAIN THE POLICY AND THE CLAIMS FILE
Because of motor vehicle and fire claims, we are used to standard form policies as set out in provincial legislation. There is no standard long-term disability policy of insurance, they are all different. The features to determine when reviewing the policy are:
- Own occ and any occ time frames and definitions, (usually two years own occ)
- Benefit amount, usually 60% to 70% of gross pay
- Duration of benefits usually 65 but sometimes 60 or 70
- Whether there is a COLA
- What are the off sets
- Are there waiver of premium benefits for life insurance or medical benefits
Obtain disclosure of the policy as soon as possible to ensure that you are claiming everything that the worker is entitled to under the policy. Do not assume anything. The claims adjuster will often refuse to produce the policy as they allege that the policy is the “property” of the employer. It can then be difficult to get the employer to produce it. Once litigation is commenced, however, the policy is in the Defendant’s Affidavit Disclosing Documents.
Obtaining the policy will allow you to calculate the monthly benefit. The policy will also set out the test for entitlement. "Any occupation" is sometimes defined as an alternative occupation that will pay at least 60% to 70% of the claimant's pre-disability income. The nuances of the policy definition are not critical the common law holds that “any occupation” should be commensurate with a person’s education, training and experience. There are many cases supporting this, see Ferguson v. National Life, 36 CCLI (2d) 95 or consider the following passage from Johnston v. Alberta School 33 CCLI (2d) 143:
“’Total Disability’ defined in terms of ‘any occupation’ or even ‘any reasonable occupation’ interpreted literally, or in the strict sense leads to an absurdity. Such interpretation effectively nullifies coverage under the policy unless an insured establishes he or she has been rendered almost helpless.
‘…Contracts of insurance are contracts of utmost good faith on the part of both parties. This imports principles of fairness for both the insured and the insurer when interpreting disputed provisions in an insurance policy by having regard to the nature, extent and purpose of the insurance coverage provided.’”
A careful examination of the policy at an early stage will help quantify the claim, determine the threshold for entitlement, and allow you to draft a more focused Statement of Claim. You might consider portions of the policy in your pleading.
Write to the insurer and request complete production of the claimant's file. The insurer seldom produces the entire file prior to litigation, but they do provide most of the materials often charging a small fee. An examination of the file will clarify the issues in dispute, and help you patch up problems at the outset by knowing what to ask your doctors.
Early disclosure of the policy and insurer's file will also give you the opportunity to evaluate the case before you are counsel of record at the Prothonotary. You might find that the insurer was justified in terminating benefits, something you want to know before you go on record.
TIP #3:
SELECT JURY TRIALS
Insurance companies are reluctant to put their fate in the hands of any third party, but will probably prefer a Judge to a Jury. The insurers likely perceive a juror as being more sympathetic and the Judge’s as tougher, or more callous. Juries are seen as more unpredictable too, all of the million dollar punitive awards against insurers in Ontario have come from Juries.
In tort claims, the insurer defends in the name of the defendant rather than the name of the insurance company. In tort claims counsel cannot inform the jury that the defendant has the benefit of insurance, raising the issue of insurance is sufficient to cause a mistrial. The concern is that the juries will be inclined to find for plaintiffs if the faceless insurer is paying the claim rather than a sympathetic defendant.
However, in long-term disability cases the defendant is the insurance company, they are named on the Statement of Defence and the Jury knows defence counsel act for, and are paid by, an insurer. In these cases, the insurance company is the party listed on the Statement of Defence.
Plaintiff personal injury are better off in the hands of a jury than a Judge. The reasons for this would make for an interesting sociology thesis, but are beyond the scope of this paper.
TIP #4:
SOME UNIONIZED EMPLOYEES CANNOT SUE, AND BE WARY OF CONCURRENT WCB APPEALS
In Nova Scotia, government employees and health care workers have a disability plan negotiated between their union and management. It is administered by Manulife so clients often mistake them for being the insurer. Do not sue Manulife in these cases. The plans are called the NSAHO LTD Plan Trust Fund and the NSGEU LTD Plan Trust Fund and both limit the right to sue. I expect there are similar entities in other Atlantic Provinces.
Our firm was able to exploit a loophole in Wright v. The NSGEU LTD Plan Trust Fund, 2005 NSSC 146 (CanLII) but after the decision the wording was promptly tightened up the Trust Fund. In the NSGEU plan, litigation is unlikely now to be an option at all at any point. You can sue NSAHO if the client did not already appear before their Medical Appeal Board. Every plan is different so be on the lookout when the employer is unionized.
If you are doing these on contingency, be wary of concurrent WCB appeals. Some clients will hire you to sue the LTD insurer while at the same time they are trying to get WCB on their own or through other counsel. You can be deep into LTD litigation and then learn that the client has been approved for WCB. This is good news for the client but your LTD claim is submarined because the benefit offset by the WCB payment. Most often, this means that you no longer have a case, or a means to get paid. It is likely worth the risk to you, and either way the client benefits, but it is best to know going in.
TIP #5:
TAX IMPLICATIONS
LTD benefits can be taxable or non-taxable. If the employer pays the entire LTD insurance premium, the benefit will be taxable. If the employee pays at least a portion of the premium, the benefit is non-taxable. Check your client’s pay stub and ask the insurer whether it is taxable.
The majority of LTD insurance plans are non-taxable but there are a number of policies with taxable benefits. When cases involving taxable benefits are settled, insurers will not deduct money from the settlement, they will issue a T4. Failing to warn a client about this tax liability will result in an understandably unhappy client and a bad phone call many months after your file is closed.
Non-taxable LTD policies are easy, if the original benefit was non-taxable, then any trial award or settlement is also non-taxable. Taxable policies, however, create complexities. There have been a number of federal court cases dealing with the taxability of lump-sum settlements of LTD claims. The Supreme Court of Canada resolved the issue in R. v. Tsiaprailis [2005] S.C.J. No. 9. In this case, the CRA originally assessed the entire settlement, both past and future benefits, as taxable. The Tax Court then found the entire settlement was not taxable. The Federal Court of Appeal disagreed and ruled the entire settlement was subject to tax. In a 4-3 split decision, the Supreme Court of Canada ruled that the portion of the settlement intended to replace past disability benefits was taxable, while the portion of the settlement intended to resolve any future benefits should not be subject to tax. Punitive and aggravated damages were also found to be non-taxable.
During negotiations of a taxable policy, Counsel should have the insurer characterize as much of the settlement as possible as “compensation for settlement of potential future claims”. There are limits to this and the breakdown must be reasonable. With past benefits, have the insurer commit to issuing a T1198. This CRA form attributes the retroactive portion of the settlement over a number of years allowing the Plaintiff to re-file spreading out the tax hit. Advise your client that legal costs are a deduction that off sets the taxable portion of the settlement, so at least they are not paying taxes on money they are not even receiving. Do what you can during negotiations but advise them to see a C.A.
TIP #6:
DISCOVER THE CLAIMS ADJUSTOR NOT THE MANAGER
LTD insurers have claims managers who are experienced at undergoing examinations for Discovery. These witnesses will have no direct experience with the file or your client and in most cases are a complete waste of time; they will talk circles around you. Identify the hands-on decision maker or adjuster on the file that had a significant role in the decision to terminate benefits. Examination of the decision maker may give you first hand information that you would never obtain by examining the insurer's semi-professional witness. You will need to spend a half day or more preparing for this examination. Discovery of the claims person can help get evidence to support a bad faith claim. Also, it will demonstrate to defense counsel and the decision maker the strength of the medical evidence and your case by referring them to supportive opinions. Some possible bad faith theories:
- - unwarranted allegation of misrepresentation or non-disclosure in policy application;
- - failure to reasonably investigate and evaluate the claim;
- - unduly delaying the investigation and evaluation of the claim;
- - failure to reasonably assist in claim preparation or advise of policy rights;
- - bias in the selection and use of experts;
- - harassing, intimidating, intrusive, or deceptive investigative practices;
- - unwarranted disputes in relation to the value of the loss;
- - refusal to pay undisputed portions of the claim while negotiating the disputed portion.
One argument you can use is where an insurer is denying for a “lack of objective findings” even though that is not a criteria in the policy. This is common, but does not recognize that fibromyalgia and chronic pain by their nature lack objective findings. In denying for “a lack of objective findings” the insurer is creating on exclusion not contained in the contract. The Court criticized an insurer for its reliance on “lack of objective findings” in Traynor v. Unum Life Insurance Co. of America (2003) 65 I.R. (3d) 7 (S.C.J.D.C.) and Stickel v. Unum Provident Corp. (2010) O.N.S.C. 4179 (S.C.J.)
The following passage from Asselstine v. Manufacturers Life Insurance Co. (2003), 17 BCLR (4th) 107 is helpful in settling up an argument supporting extra-contractual damages:
“A duty of good faith and fair dealing requires an even-handed evaluation of all evidence before the insurer by the insurer. Just as one cannot cherry pick the information to send to an assessor for a rehabilitation opinion, one cannot choose only to accept certain medical evidence in the face of compelling, conflicting evidence.”
You cannot fly by the seat of your pants for this discovery. It’s like my old basketball coach used to say:
“If you fail to prepare, you prepare to fail.”
Nowhere is this more true for Plaintiff lawyers doing LTD litigation than with the discovery of the Defendant. Do not give up on the opportunity, however, it can help your case tremendously.
TIP #7:
DO NOT CLAIM PUNITIVE DAMAGES ROUTINELY
The Supreme Court of Canada's judgment in Fidler v. Sun Life Assurance Company of Canada, 2006 S.C.J. No. 30 is the leading case on punitive and aggravated damages. In Fidler, the Court affirmed the trial judge's $20,000 award for aggravated damages, but at the same time overturned the $100,000 punitive award imposed by the British Columbia Court of Appeal.
It is important to remember that what the SCC did in this case was to restore the decision of the trial judge that had been modified by the BC Court of Appeal. In the process the Court reviewed the purpose of punitive damages. The Court noted that the trial judge carefully and fully considered all of the evidence before concluding that the actions of Sun Life, although troubling, did not constitute bad faith.
The decision of the BC Court of Appeal in awarding punitive damages was based on three considerations: (1) there was an absence of medical evidence to justify denying the claim; (2) Sun Life exaggerated the surveillance results, and (3) Sun Life failed to disclose the surveillance video to the plaintiff.
The Supreme Court of Canada shared these concerns and agreed that Sun Life's conduct was "extremely troubling" and "the five year denial by Sun Life of disability benefits without medical support for the denial is, to say the least, inappropriate." [para 71] The SCC set the standard for awarding punitive damages as:
“Whether the denial was the result of the overwhelmingly inadequate handling
of the claim, or the introduction of improper considerations into the claims
process. [para 71]”
In deciding whether this standard had been breached, the SCC deferred to the trial judge who had carefully considered "every salient aspect" of how Sun Life handled the claim including those actions found objectionable by the Court of Appeal. The reversal of the punitive award was not an attempt to rein in punitive damages awards but an effort to reinforce judicial deference in a Trial Judge. At the conclusion of the analysis, the Court noted:
“Sun Life's conduct was troubling but not sufficiently so as to justify interfering with the trial judge's conclusion that there was no bad faith. The trial judge's reasons disclose no error of law, and his eventual conclusion that Sun Life did not act in bad faith is inextricable from his findings of fact and his consideration of the evidence.” [para 75]
In litigation, the insurer’s lawyer will caution you that they never pay damages for bad faith conduct, or at least that they will not in your case. Still, if you have a theory, at least argue for punitive damages. Do not plead it at the beginning though, in my view, wait until you actually have a theory. It could influence the amount of the settlement if you have a credible claim. If the conduct is bad, you might go to trial even after benefits are reinstated, just to claim punitives. Also, in the case of reinstatement, a good argument on punitives can get you a better figure for costs, so that you do not have charge fees against your client’s retroactive payment.
Consider obtaining an expert opinion on whether the claim was administered and adjusted in accordance with standards of the industry. I am aware of a former long time Sun Life claims manager who is available as an expert on the good faith administration of LTD claims.
TIP #8:
CLAIM AGGRAVATED DAMAGES IN MOST CASES
Aggravated damages do not require wrong doing by the insurer. The test is:
1. Did the disability insurer breach the policy?
2. As a result of the breach, did the insured genuinely suffer significant additional stress?
Counsel should offer evidence on the plaintiff's reasons for entering into the contract and the impact that the denial has had upon the mental well-being of the plaintiff. This could be supported by a family physician or even a psychological IME.
At Paragraph 59 of Fidler v. Sun Life Assurance Co. of Canada [2006] S.C.J. No. 30 the Supreme Court of Canada provided the following reasoning in upholding the Trial Judge’s award of aggravated damages:
“The second question is whether the mental distress here at issue was of a degree sufficient to warrant compensation. Again, we conclude that the answer is yes. The trial judge found that Sun Life’s breach caused Ms. Fidler a substantial loss which she suffered over a five-year period. He found as a fact that Ms. Fidler ‘genuinely suffered significant additional distress and discomfort arising out of the loss of the disability coverage’…he concluded that merely paying the arrears and interest did not compensate for the years Ms. Fidler was without her benefits. His award of $20,000 seeks to compensate her for the psychological consequences of Sun Life’s breach, consequences which are reasonably in the contemplation of parties to a contract for personal services and benefits such as this one. We agree with the Court of Appeal’s decision not to disturb it.”
The Supreme Court of Canada upheld the Trial Judge’s award of $20,000 in aggravated damages. The Court’s considerations included the following:
“57 Mental distress is an effect which parties to a disability insurance contract may reasonably contemplate may flow from a failure to pay the required benefits. The intangible benefit provided by such a contract is the prospect of continued financial security when a person’s disability makes working, and therefore receiving an income, no longer possible. If benefits are unfairly denied, it may not be possible to meet ordinary living expenses. This financial pressure, on top of the loss of work and the existence of a disability, is likely to heighten an insured’s anxiety and stress. Moreover, once disabled, an insured faces the difficulty of finding an economic substitute for the loss of income caused by the denial of benefits.
58 People enter into disability insurance contracts to protect themselves from this very financial and emotional stress and insecurity. An unwarranted delay in receiving this protection can be extremely stressful. Ms. Fidler’s damages for mental distress flowed from Sun Life’s breach of contract. To accept Sun Life’s argument that an independent actionable wrong is a precondition would be to sanction the ‘conceptual incongruity of asking a plaintiff to show more than just that mental distress damages were a reasonably foreseeable consequence of breach’.
59 He concluded that merely paying the arrears and interest did not compensate for the years Ms. Fidler was without her benefits. His award of $20,000 seeks to compensate her for the psychological consequences of Sun Life’s breach, consequences which are reasonably in the contemplation of parties to a contract for personal services and benefits such as this one. We agree with the Court of Appeal’s decision not to disturb it.”
In Gerber v. Telus Corp. [2004] A.J. No. 543 the Alberta Court of Appeal upheld the Trial Judge’s award of aggravated damages:
“In Gerber, the plaintiff was awarded $20,000 in aggravated damages where the insurer’s wrongful termination of benefits and harsh communications with the insured caused her distress and aggravated her medical condition. The trial judge found that the insurer exercised ‘very poor judgment’ but its conduct was not planned, deliberate or intended to harm the insured. No punitive damages were awarded.”
. . . . .
“...The appellate court found that while the Disability Plan was ‘a benefit of the employment contract, its proper characterization is as a contract of insurance. This being so, we are of the view that it is, in nature and substance, a ‘peace of mind’ contract. Accordingly, aggravated damages may be awarded for breach of that contract even absent an independent actionable wrong: Cringle v. Northern Union Insurance Co. Ltd., and Brown v. Waterloo Regional Board of Commissioners of Police. Telus knew that the withdrawal of coverage would exacerbate the plaintiff’s health, they communicated the termination to the plaintiff in a harsh way, and they had a poor decision making process which permitted an inaccurate and incomplete report to be used as a foundation for its decision.”
In the Trial level decision Justice Rowbatham’s comments include the following:
“118 However, the conduct of Telus leading up to the termination of Ms. Gerber’s benefits, including the manner in which she was so advised does warrant an award of aggravated damages. Aggravated damages are compensatory (not punitive) and are equated with the mental distress resulting from the insurer’s actions. No separate actionable wrong is required.
. . . . .
119 Upon receipt of the notice of termination Ms. Gerber’s health deteriorated. This is supported by the letter from Dr. Kish. In addition her credibility has been continually challenged despite the evidence of all medical practitioners who spent significant periods of time with her…In the circumstances, I find that an award of aggravated damages in the amount of $20,000 is justified.”
In Asselstine v. Manufacturers Life Insurance Co., [2005] BCJ No.1152 the Court of Appeal upheld the Trial Judge’s award of $35,000 in aggravated damages. The Court of Appeal affirmed the following passage from the Trial Judge:
“Aggravated Damages
209 In this case, Ms. Asselstine has suffered increased anxiety, mental, emotional and financial stress as a result of the rejection of her claim and her appeals. The time it has required to deal with the matter, the financial strain and uncertainty, and the resulting protracted litigation that has followed, all has occurred at a time when she is most vulnerable and weak on account of MS. The case law suggests that awards for aggravated damages are wide-ranging. I have reviewed the authorities cited to me by counsel and consider an award of $35,000 for aggravated damages reasonable in the circumstances.”
The majority decision of the Court of Appeal in Asselstine, ibid. included the following discussion as to the $35,000 award for aggravated damages:
“18 It is contended that the award of aggravated damages, $35,000, is inordinately high. It is accepted that awards of aggravated damages are now commonplace whenever claims for benefits on what are characterized as "peace of mind contracts", like long term disability insurance policies, are wrongly denied. The award provides compensation for mental distress which will usually be a consequence of a breach of contracts of that kind...
In Cross v. Canada Life Assurance Co., [2002] O.J. No. 293, the Ontario Court of Justice awarded $29,000 in aggravated damages based on the following reasons:
“26 I hold, in this case, the failure by the defendant to process the claim on a timely basis constitutes a separate, actionable wrong, as they failed to act in good faith as a result thereof.
27 I further hold that this is an appropriate case for an award of aggravated damages. Ms. Cross, on her undisputed evidence, suffered a great deal of anxiety and distress as a result of the delayed process and her failing to be advised as to whether or not the long-term disability claim would be accepted or not...”
In Fowler v. Maritime Life Assurance Co., [2002] NJ No. 217, Justice Adams awarded $75,000 in aggravated damages:
“¶105 The defendant owed Mr. Fowler a duty to take a reasonable, balanced approach to the interpretation of this contract sold to him as a "peace of mind" income security insurance policy. Instead, the company pressed every advantage it felt it had and took unfair advantage of its superior financial position to force its way.”
Aggravated damages are intended to compensate for mental distress caused by a breach of contract. They do not require wrong doing by the Defendant other than the fact of the breach, and it having significant impact on the Plaintiff. This would apply to most cases except those where the family or individual is financially sound and independent even without the disability benefit, but that is extremely rare. You should always claim aggravated damages.
TIP #9:
CLIENT’S DISCOVERY: NO GENERALIZATIONS
Efficiency and good practice means that we have to avoid spending unconstructive time with our clients. We are not trained as psychologists or doctors, and assuming many other roles has dubious benefits to us and our clients. Other than the intake, however, a pre-discovery meeting can be beneficial and worth the time if done right.
Advise the client of the likelihood that they were under surveillance at some point. Defense counsel can be tricky, they lead them down the garden path having them to commit to having never mowed their lawn when in fact they may have done so in short spurts or on a good day.
Surveillance by itself is rarely damaging. It is only when defense counsel is able to have it contradict the Plaintiff’s discovery evidence or what they have told a physician, that it undermines credibility and therefore the whole case. Having video of someone mowing a lawn or taking a walk is not harmful, it is likely to be consistent with their doctor’s advice to do whatever they can for as long as they can. It is when the video directly contradicts testimony that we have to really worry.
Without the contradiction, surveillance is most useful to the defense as a form of intimidation and harassment which might have very limited value at Trial and could even make the Defendant look bad before a Jury.
TIP #10:
GATHER GOOD LAY EVIDENCE
Invisible illnesses like chronic pain, fibromyalgia, or depression, are the types of conditions likely to result in a denial of LTD. In these cases, success hinges on your client’s credibility. Demonstrate that your client is motivated to return to work, and that she has a solid work ethic.
The best evidence from lay witnesses is that the plaintiff loved their job, was good at it, talked about it, was well-liked, and seldom missed time. Evidence from a supervisor is good, but a co-worker could be just as helpful. It pays to interview all potential lay witnesses and not just go by what the client tells you. As always, stories that demonstrate the point are better than general statements like “he was a good worker”. If you do not prepare and just dump your lay witness on the stand you are apt to be disappointed. You might even end up helping the Defendant.
TIP #11:
DISCOUNT RATES
Discount rates are used to calculate the present value of a future income stream. Discount rates are applicable in lump sum settlements; the Court cannot order a payout, only reinstatement. An in depth discussion is beyond the scope of this paper. If the policy contains a cost of living adjustment (COLA), use a three percent discount to calculate the present day value of future benefits. If there is no COLA, use a five percent discount. The insurer and their counsel will sometimes exaggerate and argue for a seven percent discount rate. If you want to be sure, have an actuary repot on this, but make sure they understand this is LTD and not an MVA case where the discount rate is set out in the legislation.
TIP #12:
FILE AND SERVE IMMEDIATELY
In pursuing internal appeals rather than litigating you risk wasting precious time and energy getting into a paper chase with the claims adjustor. Your client’s life line has been severed and they need it restored. Clients are exposed to the risk of losing their home, going bankrupt, and all of the psychosocial problems that go along with this. Time is of the essence so do you want to risk wasting many months dealing with the adjustor?
TIP #13:
LUMP SUM OR REINSTATEMENT
A lump sum is less secure but more attractive if the client might recover, be able to work part-time, or if they want a divorce from the insurer. Most clients prefer a lump sum but you cannot force the insurer to offer this. Reinstatement on the other hand, offers more long term security.
It is dangerous to settle before you know if your client will be approved for CPP disability. The insurer will want to offset CPP even though you do not know for sure if the client will be approved. The insurer and their counsel often overestimate the hypothetical amount of CPP disability your client would receive if approved, thereby increasing the offset. Before mediation or a judicial settlement conference have your client call CPP to find out an estimate of what their benefit will be. If you settle before CPP is dealt with, advise the client of the risk.
TIP #14:
MEDIATION OR JUDICIAL SETTLEMENT CONFERENCE
Mediation and judicial settlement conferences are both effective tools for setting LTD claims. Ensure that the Defendant’s decision maker is going to be present before you agree to attend. I prefer mediation because the Mediators have more experience and motivation than many Supreme Court Judges, particularly with LTD claims. There is good reason that many parties will pay $5,000 for a mediation rather than participate in a free settlement conference. The Defendant too is more apt to be sincere about trying to settle using a Mediator, while they often use settlement conferences tactically. This is not meant as a knock against the judiciary where most Judges work hard and very effectively at getting these things resolved.
TIP #15:
CRAFT QUESTIONS TO EXPERTS
Do not just ask the doctor if the client is “disabled from any employment”, set out questions based on the policy wording and case law. My experience is that doctors are more apt to support a Plaintiff to get CPP disability than LTD. Similarly, in an MVA claim the best way to prove total disability is by having the client apply for CPP disability and get the support of their family doctor that way. The psycho-sociology behind this bias would make for an interesting study.
Anyway, some possible questions for doctors based on case law follow:
1. Is Jane physically and mentally fit to perform the substantial full-time duties of her regular occupation?
- 2. Is Jane physically and mentally fit to perform the substantial duties of any other full-time occupation for which she is, reasonably fitted by education, training, or experience? In other words, is Jane able to substantially perform the essential duties of commensurate employment to the standard of a reasonable employer? Commensurate means employment that is similar in measure and extent to her previous work.
- 3. Do you feel that a “real world” employer or “reasonable” employer is likely to hire Jane given her limitations and problems?
Question two is rooted in Clarke v. National Life Assurance Co. of Canada 48 CCLI 129:
“It is clear from the jurisprudence that total disability with respect to any employment, does not mean absolute helplessness, but simply the inability to substantially perform the essential duties of commensurate employment to the standard of a reasonable employer.”
Question three is based upon the Federal Court of Appeal decision in Villani v. Canada (AG), 2001 FCA 248, paragraph 39:
“Parliament must have intended that the legal test for severity be applied with some degree of reference to the “real world”. It is difficult to understand what purpose the legislation would serve if it provided that disability benefits should be paid only to those applicants who were incapable of pursuing any conceivable form of occupation no matter how irregular, ungainful or insubstantial. Such an approach would defeat the obvious objectives of the Plan and result in an analysis that is not supportable on the plain language of the statute.”
If your client is supported by their family doctor you have a case, but it’s far better to have a specialist or two on their side.
In taking on long term disability cases we have an enormous responsibility. I wish you the best for you and your clients.
