By Matt Lalande in Long-Term Disability on September 24, 2023
Generally speaking, long-term disability policies are comprised of two major timelines – the first being the first 24 months after the elimination period (or after a claimant receives short-term disability or ei) and from 24 months until the age of 65.
In this article, we examine several important theories which are important in terms of disability law – and more importantly, how our Courts have decided on many of these issues.. To do this – we refer to several important cases which stem back as far as 40 years.
During the first 24 months of disability, the claimant will normally qualify for long-term disability benefits if he or she is unable to complete the substantial duties of his or her own occupation. After 24 months a claimant faces what is called the “change of definition”. This juncture is when the the definition of total disability changes from “own occupation” to “any occupation” or is otherwise referred to as the “any occ” provision.
Remember – disability benefits serve as what we call a “peace of mind” insurance, providing financial security and support in the event that illness or injury prevents a person from working. By replacing a portion of his or her’s lost income during such challenging times, these benefits alleviate financial stress, allowing the individual to focus on recovery and well-being. If you or your loved one has been denied long-term disability benefits call us today. Matt Lalande is a disability lawyer who helped wrote the book “Disability Insurance Law in Canada” and has been practicing disability litigation for the last 20 years. Fill in a contact form or call us today toll free at 1-844-LALANDE or local in Southern Ontario at 905-333-8888 for your free consultation today.
Well known Disability Author David Norwood defined “any occupation” as follows:
The definition of “total disability” in a disability insurance policy generally covers an insured person against his or her inability to perform “each and every duty pertaining to his occupation”, and, after a certain period of time, “to engage in any [gainful, reasonable] occupation for which he is [or may become] “fitted by education, training or experience”
Norwood on Life Insurance Law in Canada (3rd ed.) (Toronto: Carswell, 2002)
To better explain – within the context of Canadian Long-Term Disability (LTD) policies, after a specified period (often 24 months, but this can vary based on the policy), the definition typically transitions from “own occupation” to the “any occupation” standard. Under the “any occupation” definition, to continue receiving LTD benefits, the individual must be unable to work in any occupation for which they are reasonably suited by education, training, or experience, and not just their own specific occupation.
In essence, it becomes a more stringent criterion to meet. Even if the claimant can’t return to their original job, they might be deemed capable of performing some other type of work. If a disability insurance company determines that a person can work in any such occupation, they may discontinue the disability benefits.
It’s worth noting that specific terms, conditions, and definitions can vary across LTD policies and insurance providers. Therefore, it’s important to review the actual policy language or consult with our long-term disability lawyers for proper advice.
Fiurstly – what is the burden of proof? Simply put, the burden of proof refers to the obligation placed on a party in a legal case to establish, through evidence or argument, the truth of their claims to the standard set by law, determining which side must convince the judge or jury of its version of events or facts in order to prevail. In a disability case, the burden of proof is that of a “balance of probabilities” requiring that a claim be more likely true than not true.
In St. John’s Rehabilitation Hospital and ONA, (Re, 2016 CarswellOnt 6381 Ont. Arb.) the Arbitrator summarized the applicable burden of proof as follows, at para. 82:
a) The onus of proof of total disability is upon the claimant …. Of course, the civil standard, i.e., balance of probabilities, will apply.
b) If the insured is able to present a prima facie case that he or she is totally disabled from “any occupation”, the onus then shifts to the insurer (or in this case the hospital) to establish that there is a specific occupation that the insured is capable of substantially performing
It’s long been found that a Court will construe the definition of “any occupation” liberally and reasonably and not “literally”. In other words, when courts mention that they will construe the definition of “any occupation” liberally and reasonably, and not “literally”, it implies a more claimant-favorable interpretation.
Rather than adopting a narrow or overly restrictive view, the court aims to interpret the term in a manner that aligns with the broader intent of the policy and the reasonable expectations of the insured. This approach recognizes that interpreting “any occupation” in an overly literal sense might result in unfair outcomes, such as expecting a claimant to take on any job, regardless of suitability or dignity – which makes no sense.
By adopting a liberal and reasonable lens, courts endeavor to ensure that claimants are treated fairly, and that disability benefits are not denied on overly technical or unrealistic grounds.
Certain authorities have dealt with this. For example, in an old case called MacEachern v. Co-operative Fire & Casualty Co. (1987), 196 A.P.R. 127 (N.S. C.A.) the claimant was disabled from his job as a stenographer because of awful back pain.
In order to qualify for ongoing disability benefits, he was required to have a “total and permanent disability” which was defined by the policy as “a disability to the extent that the Employee is wholly and continuously prevented from engaging in any occupation for wage or profit for which he is qualified or may reasonably become qualified by reason of his education, training and experience.“
The Court considered cases involving the “own occupation test”, and noted that the words of the policies had been interpreted not literally, but reasonably. It went on to endorse that the same principles of liberal construction apply to the “any occupation” cases as do to the “own occupation” cases.
In another disability arbitration decision of – Windsor Regional Hospital and ONA, Re, 2015 CarswellOnt 5012 (Ont. Arb.), the Arbitrator found that “the question of disability is an issue on which the onus of proof rests on the union, but determining disability must be approached from the point of view of a liberal and reasonable interpretation of the benefit plan wording. Whatever a strict interpretation might produce, an arbitrator must seek a reasonable conclusion based on a balance of probabilities on all of the evidence, and must hold decision-makers in the plan administration to the same standard.”
When determining if a claimant meets the test for total disability under the “any occupation” definition, our courts have clearly stated that the test is subjective in the sense that the background and personal characteristics of the claimant are to be taken into consideration.
What does this mean? In Canadian disability law, when it is said that the test for total disability in terms of “any occupation” is subjective, it means that the determination isn’t based solely on objective medical findings or rigid criteria. Instead, it takes into account the individual’s personal circumstances, including their training, skills, experience, age – or his or her whole life.
The subjective nature of the test recognizes that disability isn’t just about medical conditions or diagnoses. It’s also about how those conditions affect the individual in the context of their life and their ability to work. Two people with the same medical diagnosis might have different levels of functionality based on their unique circumstances. Some say it’s looking at a person’s overall “funciton”.
For instance, consider two individuals with the same back injury. One person might have worked in a physically demanding job and cannot return to such work, while another person, with a background in desk jobs, might still be able to work. The subjective test allows for these nuances and ensures that individuals are assessed based on their actual ability (or inability) to engage in gainful employment suitable to their education, training, and experience.
However, while the test is subjective, claimants often still need to provide supporting evidence, such as medical records, expert testimonies, and other relevant documents, to substantiate their claims of total disability in terms of “any occupation”.
Take for example, the case of Wachal v. Crown Life Insurance Co. (1999), 140 Man. R. (2d) 26 (Man. Q.B.). In this case, the Court affirmed the subjectivity principle. The disability claimant had mild to moderate depression and increasingly severe migraines in addition to problems with her hands. The Court held that the test for disability was subjective, and related to the background and education of the insured. In this case, although the insured was not disabled from her occupation by hand problems, her other characteristics rendered her totally disabled.
A similar explanation was provided by our Courts in Nantsios v. Canada Life Assurance Co. (1996), 40 C.C.L.I. (2d) 247 (Ont. Gen. Div.) The Court examined the test for total disability, where it was deemed to be not whether the insured had an absolute physical inability to do anything related to his or her previous occupation, but whether common care and prudence prevented those activities. The specific characteristics of the insured were to be considered, and it was again noted to be a subjective test. With respect to the “any occupation test” for total disability, the Court stated:
The test is not whether a job is within the insured’s capability, rather, the test is whether there is a full time job for which the insured is reasonably fitted by what he has done before.
The Court went on to note:
The test is a subjective one, and must take into account the characteristics of the insured plaintiff, including his education or lack thereof, his advanced age, his limited work experience, and his medical condition.
Numerous other Canadian cases have examined the extent to which the insured’s physical restrictions, age, low education level and aptitude test results allowed for alternative occupations, and thus must be considered when determining the ability to work at any occupation.
The case law is clear that a claimant is not disentitled to benefits under the “any occupation” category by virtue of being able to perform some work functions.
In Maleschuk v. Sun Life Assurance Co. of Canada (1999), 7 C.C.E.L. (3d) 113 (Ont. S.C.J.), the employee had been off work from his job at Stelco and receiving disability benefits for approximately six years. He had done some unpaid work for his personal investment in a retirement home – Sun Life found out about it – and of course, terminated his benefits.
The policy defined entitlement as being “wholly and continuously disabled so as to be prevented thereby from engaging in any occupation or employment for wage or profit for which he is reasonably qualified by education, training or experience.” The Court cited with approval, the Nova Scotia Court of Appeal Case MacEachern v. Co-operative Fire & Casualty Co. and concluded that the plaintiff had met the test. It went on to indicate that “common care and prudence required him to remain off work at Stelco” in order to effectuate a cure.
In Liesch v. Standard Life Assurance Co. the claimant was severely depressed and suffered from an adjustment disorder. The insurer denied that he was entitled to long-term disability benefits as he had not proved that he was disabled from his own occupation as at March 26, 2001 or from any occupation as at March 26, 2003.
The claimant sued standard life, seeking a declaration that he was disabled within the meaning of the long-term disability policy. The Court found that Mr. Liesch was severely depressed and suffered from an adjustment disorder. His job as regional sales manager was particularly demanding. Despite the fact he might have been able to manage one or two functions of his regular employment sporadically, this was not sufficient to deem him capable of doing his job. Without any true analysis, the court went on to decide that he was also unable to perform any remunerated function or work for which he was reasonably fitted by training, education or experience.
Holding a demanding job as a sales manager previously, the court held that it was insufficient that the insured may be able to manage one or two functions of his regular employment sporadically – but that was about it. He was held to be unable to perform any remunerated function or work for which he was reasonably fitted by training, education or experience.
In another case, Willinsky v. Imperial Life Assurance Co. of Canada, the claimant was a dentist who, due to pain in his hand, was able to perform some dental procedures but he was unable to perform “lengthy dental” procedures of which most of his practice consisted. He was found to be within the policy’s definition of “total disability”. The Court remarked that
“We all know of heroic stories of persons with severe physical limitations who are able to rise above those limitations and function with virtually no disability. There are others, however, who succumb to only minor physical limitations and are rendered totally disabled literally. It is always a challenge for a court to determine where, on this spectrum, someone like the plaintiff falls. For me, the medical evidence is only one side of the total picture. The remaining evidence of all of the surrounding circumstances is the other side and, in a case such as this, it may be of even greater significance …“
This piece of information is very important.
It is also clear from Canadian Court Decisions that is a Disability insurance company wants to terminate benefits, then that employee must be capable of performing “true work” to an acceptable standard in the economic marketplace.
For example, in the case of Ferguson v. National Life Assurance Co. of Canada, the plaintiff was a bus driver had access to long term disability by the insurer through his employer. The policy defined the term “totally disabled”, after the initial 24 months of coverage, as being,
… such complete incapacity resulting from a medically determinable physical or mental impairment that prevented the employee from performing any and every duty of any occupation or employment for which he was reasonably qualified by education, training or experience.
The claimant, suffering from various job pressures, ultimately applied for long term disability benefits. The insurer approved his claim, and benefits were paid for over 4 years. Her symptoms were up and down in their prominence, and there were differing diagnoses.
The insurer terminated his long-term benefits based solely on their own so called “independent” psychologist’s report. The plaintiff’s treating psychiatrist and his expert then stated that the plaintiff had a deeply rooted psychiatric problem. They were both of the opinion that he had a medically determinable mental impairment and was still incapable of performing any form of remunerative employment. The Court accepted the doctors’ opinions that the plaintiff had a medically determinable mental impairment and was still incapable of performing any form of remunerative employment. It held that the plaintiff had been totally disabled at the time his benefits were terminated and he continued to be totally disabled.
In reaching its decision, the Court stated that it was 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.
It was found that the employee was not capable of performing work to the standard of a reasonable employer. Her short shifts as a bus driver and requirement to work during periods which are not very busy combine to make it difficult for her to be competitively employable.
No, an attempted return to work should not, in itself, disqualify a claimant from long term disability benefits – but the problem is – it often does. Inexperienced insurance adjusters will often – OFTEN – view an attempted return to work as a chance to terminate benefits.
In a seminal decisions, Stewart Estate v. London Life Insurance Co., is on point. During his period of disability the claimant returned to work for a month while still under the “own occupation” portion of the test. The Court held that the insured’s return to work for a short period did not preclude entitlement to benefits. In reaching it’s decision, the Court cited a 1978 case called Foden v. Co-operative Insurance Assn which stated:
No one, in my opinion, should be discouraged from attempting to take up their former work, or any work, out of fear that the attempt might be held against him. Far from necessarily proving that an insured has the capacity to perform his task it may, as in my opinion it does here, prove the reverse. There is no better evidence of incapacity to perform a task than the failure of an honest and sustained attempt to do it.
Also, in the 2011 case of Inglis v. Nova Scotia Public Service Long Term Disability Plan Trust Fund, a plumber with diabetes developed mental health issues, including depression. He was on disability, then attempted an eight-week trial to return to his own occupation. The work trial was supported by medical documentation.
The plaintiff argued that he should not be penalized for his “imprudent and unrealistic” attempt to return to work – with his lawyer referred to Foden. The Judge was satisfied that as a matter of “real world” employability, the plaintiff has established that he was totally disabled within the meaning of the LTD Plan as of the date his benefits were terminated in September 2002, and that he remains disabled by the same standard. This conclusion rested both on the evidence relating to the plaintiff’s diabetes and on the evidence of depressive illness. It was noted that he was not to be penalized for trying to return to work.
Another disability case on point is In Nicholas v. Metropolitan Life Insurance Co. of Canada. In this case, the insured was employed as a medical technologist and become unable to perform her job due to electromagnetic sensitivity and chronic fatigue syndrome. She was initially paid disability benefits, but her benefits were terminated on the basis that she was not incapable of performing “any occupation” which was defined in the policy as preventing “the Employee from performing any occupation or work for which she/he is, or may become, reasonably qualified by education, training or experience.” She had unsuccessfully attempted to run a Bed and Breakfast business after her benefits were denied. She also tried to teach yoga part time. The court indicated that the plaintiff should not be “penalized for making every effort to work, especially when her efforts were unsuccessful,” and found her to be disabled under the “any occupation” test.
In a 1994 case called Brasseur v. Anglo Canada General Insurance Co, the claimant had suffered extensive injuries in a car accident, leaving her unable to work because of pain. Shortly before the end of the initial two-year “own occ” period of disability benefits the insured learned that the group insurer was refusing to provide disability benefits thereafter. She then obtained part-time work in a nursing home which became full-time work – but she only lasted 15 months. She suffered considerable pain when performing her duties. It was held that the fact of returning to work, under threat of loss of disability benefits, was not an immediate bar to her disability claim.
What about part-time work? This is a good question.
The case of MacEachern v. Co-operative Fire & Casualty Co. addresses this point – sort of. The Court found that part-time work did not qualify as being able to “substantially” perform any occupation. It was noted that on Appeal, the appellate court did not address this issue of part-time employment, but it appeared from an assessment of the case, that the ability to be employed must be commensurate with the salary and type of employment previously enjoyed. It was held that an individual able to function part-time may still be totally disabled. A claimant may be deemed totally disabled if he or she is unfit for employment commensurate with salary, hours worked and the occupation formerly carried out by him/her.
As for back as 1988, in a case called Stutt v. Alberta (Provincial Treasurer) , our Courts have found that a claimant’s alternative occupation must be something that is comparable to his or her former line of work in status and potential earnings. Even if the policy doesn’t contain the words “reasonably fitted by education, training or experience,” the proposed occupation must be something for which the insured is qualified by virtue of his schooling and work experience.
For example, in 1995 case called Johnston v. Alberta School Employee Benefit Plan, the disability claimant was teacher that suffered from unpredictable hypoglycemic attacks caused by diabetes. In order to be entitled to benefits, she needed to be “unable to perform the duties of any occupation for which she was or might become suited by reason of her education, training or experience.” The court noted that interpreted literally, “total disability” to perform “any occupation” leads to an absurdity, since an insured would have to prove that he or she had been rendered almost helpless.
A reasonable interpretation was a disability that would prevent the plaintiff from performing a remunerative occupation commensurate in the broad sense with her previous employment and income, for which she was qualified or could become qualified, having regard to her age, training, experience and opportunity.
With respect to the definition of “any occupation” the court referred to Norwood, Life Insurance Law in Canada, at p. 289 where the author stated:
A person is considered not to be totally disabled from engaging in ‘any’ occupation if his condition would enable him to enter into an occupation reasonably comparable to his old occupation in status and reward, and reasonably suitable in work activity in light of his education, training and experience.
The Court also referred to Stutt, and concluded that in essence, these authorities interpret “any occupation total disability” to mean a disability that prevents an insured from performing a remunerative occupation commensurate in the broad sense with his or her previous employment and income for which he or she is or can become qualified mentally and physically, having regard to age, training and experience and opportunity. On the basis of this definition the court concluded that the plaintiff was totally disabled from “any occupation.”
In the 1986 case of Labelle v. Great-West Life Assurance Co.,the claimant was an hourly employee who had lost four fingers in a work place incident.
The court once again gave thorough consideration and approval to the considered text by David Norwood, Life Insurance Law in Canada (1977) at pp. 288-90 which defined total disability as follows:
Disability benefits offer peace of mind by providing financial support if illness or injury prevents someone from working, ensuring they can focus on recovery without major financial worries – but the reality is that disability insurance companies are in the business of profit – which means that paying claims is not beneficial to their bottom line. We understand that often times, dsiability insurance companies terminate beneifts wrongfly and leave hurt of sick plaintiff’s alone, frustrated and without any recourse.
Lalande Personal Injury Lawyers are here to protect you. If you’ve been denied long-term disabiity benefits, call us today. Matt Lalande is a long-term disability lawyer who has been protecting the rights of disability claimants since 2003 – and is prepared to help you.
Our consultations are 100% free – and if you decide to work with our Hamilton disability lawyers, the fee is free. We do not charge our clients anything unless we win their case. We are happy to provide you the legal advice you need in order for you to make an informed decision about your own particular situation. Call us no matter where you are in Ontario at 1-844-LALANDE or local in the Southern Ontario region at 905-333-8888. Alternatively, you can send us a confidential email through our website – and we would be happy to explain your long-term disability rights and legal options to you, at no cost.
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