Security National Insurance Company failed to claw back $12,100 in accident benefits after Ontario's Licence Appeal Tribunal found suspicion alone couldn't prove wilful misrepresentation.
The insurer had paid income replacement benefits to a claimant injured in a June 30, 2023 automobile accident, then sought repayment of $12,100 covering July 25, 2023 to March 24, 2024. Its argument: the claimant misrepresented his employment status and post-accident income while collecting the benefits.
To support the claim, the insurer pointed to four sources of evidence - the claimant's tax records, medical records, surveillance, and his own statements, including testimony at an examination under oath and at the hearing. Central to the case was approximately $6,000 in income on the claimant's 2023 tax return that had not been reported to the insurer.
The claimant said the amount was a bonus, paid in cash in 2023 for work performed in 2022, and produced a letter from his former employer. The insurer urged the adjudicator to give that letter little weight because it lacked payroll records and the employer did not testify despite being summoned, and to draw an adverse inference from that absence.
Adjudicator Gurleen Thethi declined. The reported income raised legitimate questions, she found, but its existence alone did not show the claimant was working while receiving benefits or had deliberately misrepresented his circumstances. The burden sat with the insurer, and even an adverse inference from the employer's no-show would not close the evidentiary gaps.
The adjudicator gave similar treatment to the rest of the file. Inconsistencies in the claimant's evidence existed, she accepted, but not every inconsistency signals dishonesty, particularly for events several years old. Medical records from three practitioners referencing construction or renovation work were not determinative, lacking detail on timing or extent. Surveillance was admissible but carried limited weight because it was conducted after the repayment period and after benefits had been terminated.
"Suspicion is not sufficient to meet the legal test for willful misrepresentation," Thethi wrote. The evidence, she concluded, was largely circumstantial and did not establish on a balance of probabilities that the claimant knowingly made false representations.
The outcome also turned on timing. Under the Statutory Accident Benefits Schedule, an insurer generally must issue a repayment notice within 12 months of the payment, unless the benefit was originally paid because of wilful misrepresentation or fraud. The insurer issued its first repayment notice on February 11, 2025 - more than a year after benefits paid before February 11, 2024. With misrepresentation unproven, that timing barred part of the claim.
Because no repayment was owed, the tribunal found no interest was payable.
The claimant then sought costs, arguing the repayment claim was frivolous and unsupported. The adjudicator refused. An unsuccessful claim does not by itself warrant costs, she noted, and the insurer had a reasonable basis to investigate and advance its position. The dispute over employment status and reported income raised legitimate issues, and neither side had acted unreasonably.
The decision was released July 21, 2026.
