- Hutton v. The Manufacturers Life Insurance Company, 2019 ONSC 279
– The plaintiff, Ms. Hutton has sued the defendant Manufacturers Life Insurance Company for denial of Long Term Disability Benefits (LTD) under an insurance policy issued by the defendant contracted by the plaintiff’s employer, Quinte Health Care (“QHC”). However, the plaintiff was bound by the terms of the collective agreement with the plaintiff’s union, the Ontario Public Service Employees Union (OPSEU).
In response, the defendant, Manulife has brought a motion to dismiss the plaintiff’s action as it believed that the court lacks jurisdiction to deal with a claim governed by the terms and conditions of a collective agreement between the plaintiff’s union OPSEU and employer, QHC, a matter exclusively within the arbitral jurisdiction of the collective agreement.
On or about August 17, 2011 the plaintiff sustained injuries in a motor vehicle accident from which she claimed caused her to become disabled, and thereby qualified to receive long-term disability benefits under the carrier’s insurance policy as provided under the terms of the collective agreement.
The court judge ruled that the plaintiff’s entitlement to LTD benefits provided by Article 15 of the collective agreement properly falls within category 2 of the Brown and Beatty categories, and, as such any dispute as to those entitlements under the collective agreement was properly within the jurisdiction of an arbitrator to determine. It was determined that it was an arbitrable matter, which if submitted to an arbitrator to determine could have resulted in a legally binding remedy.
Ultimately, the defendant’s motion to dismiss the plaintiff’s action is granted.
2. Morris v. Manufacturers Life Assurance Co., 2005 CanLII 4580 (ON SC)
-The plaintiff commenced an action against the defendants, Manufacturers Life Assurance (Manulife) and City of Toronto (employer) following its denial of her long term disability benefits.
The plaintiff’s Statement of Claim in this action demands:
(a) A declaration that the Plaintiff has and continues to be “totally disabled” as of July 23, 2003;
(b) A declaration that the Plaintiff remains entitled to benefits in the future for so long as she remains “totally disabled” as provided by a benefits plan offered to the Plaintiff by the Defendant, City of Toronto, which includes long-term disability benefits;
(c) Payment of disability benefits in the monthly sum of $2,833.00 from the conclusion of the qualifying period on or about January 17, 2004 to the date of trial, and ongoing so long as the Plaintiff continues to be “totally disabled”;
(d) Aggravated, exemplary and punitive damages in the sum of $1,000,000,000.00 for bad faith and breach of fiduciary duty;
(e) Costs of this action on a substantial indemnity basis…
However, the plaintiff was a union member covered by a collective agreement. And, the defendants argued that the essential character of the dispute arises from the interpretation, application, administration of a collective agreement, and that the courts must decline jurisdiction.
The Collective Agreement provides:
12.01(a) A permanent employee of the City shall be entitled to the benefits provided for in this Article upon the completion of his/her probationary period as set out in Article 4 (Probationary Period).
. . .
12.06(a) The City will provide for all employees by contract with an insurer selected by the City a Long Term Disability plan for employees and will pay one hundred percent (100%) of the cost thereof to provide a long term disability benefit of seventy-five percent (75%) of such employee’s basic salary to a maximum of $4,750.00 per month for disability claims, inclusive of any benefits paid under any pension plan, insurance plan, Workplace Safety and Insurance Board or any other plan to which the City makes any contribution. Such long term disability benefit to be payable after six (6) continuous months absence from work on account of illness or injury; provided that no employee shall be eligible to collect Long Term Disability benefit payments so long as he/she is in receipt of sick pay benefits from the City.
Effective March 1, 2003, the City will provide for all employees by contract with an insurer selected by the City a Long Term Disability plan for employees and will pay one hundred percent (100%) of the cost thereof to provide a long term disability benefit of seventy-five percent (75%) of such employee’s basic salary per month for disability claims, inclusive of any benefits paid under any pension plan, insurance plan, Workplace Safety and Insurance Board or any other plan to which the City makes any contribution. Such long term disability benefit to be payable after six (6) continuous months absence from work on account of illness or injury; provided that no employee shall be eligible to collect Long Term Disability benefit payments so long as he/she is in receipt of sick pay benefits from the City.
. . .
12.09 The City shall provide each employee a copy of the benefit plan book and shall provide updates when they occur. The City shall provide Local 79 with a copy of the benefit plan book and updates for proof-reading and comment prior to its distribution to employees.
The court judge ruled that the parties to the collective agreement intended that disputes about benefits would be resolved by arbitration. Section 16.24 “Benefit Grievances” expressly provides that differences as to benefit entitlement shall be arbitrated. Manulife is only the agent of the City of Toronto (where the plaintiff was employed); the City bears ultimate responsibility for deciding whether benefits are payable and for paying those benefits. Accordingly, this plaintiff’s action was dismissed against both defendants.
