Neutral Citation: 1993 ONICDRG 61
File No. A-004204
ONTARIO INSURANCE COMMISSION
BETWEEN:
VIOLET WIGGAN
Applicant
and
SIMCOE & ERIE GENERAL INSURANCE COMPANY
Insurer
DECISION ON THE PRELIMINARY ISSUE
Issue:
The Applicant, Violet Wiggan, was injured in a motor vehicle accident on October 22, 1990. She applied for and received accident benefits from the Insurer payable under Ontario Regulation 672 (the "No-Fault Benefits Schedule"), enacted under the Insurance Act, R.S.O. 1990, c. I.8.
Ms. Wiggan was paid weekly disability benefits until April 29, 1991, when the Insurer terminated this benefit. Ms. Wiggan applied for mediation of her dispute with the Insurer about her entitlement to statutory accident benefits. Mediation was conducted between March 4, 1993 and April 27, 1993, nearly two years after her benefits were cut off. The dispute was not resolved in mediation. On May 25, 1993, Ms. Wiggan applied for arbitration under the Insurance Act.
The preliminary issue to be decided is:
- Did Ms. Wiggan file for arbitration in a timely manner?
Ms. Wiggan also claims her expenses incurred in the hearing.
Result:
- Ms. Wiggan did file for arbitration within the statutory time limit.
Hearing:
The hearing was held in North York, Ontario, on September 27, 1993, before me, Fred B. Sampliner, arbitrator.
Present at the Hearing:
Applicant:
Violet Wiggan
Applicant's Representative:
Altor Shields
Barrister and Solicitor
Insurer's Representative:
Ralph D'Angelo
Barrister and Solicitor
Witnesses:
Patricia Doyle
Claims Examiner,
Simcoe & Erie General Insurance Company
Exhibit:
Exhibit 1
Affidavit of Tricia Doyle
The Applicant presented a Statement of Facts and Law. The Insurer submitted a Brief and case authorities it relied upon.
Evidence and Findings:
Section 281(5) of the Insurance Act, R.S.O. 1990, c. I.8 states:
A proceeding in a court or an arbitration proceeding in respect of no-fault benefits must be commenced within two years after the insurer's refusal to pay the benefit claimed or within such longer period as may be provided in the No-Fault Benefits Schedule.1990, c.2, s.65, part.
Ms. Wiggan contends that the Insurer did not notify her that her accident benefits were being terminated. The Insurer argues that it provided notice to Ms. Wiggan more than two years before she applied for arbitration, and she is barred from commencing an arbitration proceeding.
Simcoe & Erie sent Ms. Wiggan two letters. The documents were introduced through the testimony and affidavit of Patricia (Tricia) Doyle. I found Ms. Doyle to be a reliable and credible witness.
Ms. Doyle testified that she had been a claims examiner with Simcoe & Erie Insurance Company in May 1991, with responsibility for payment of Ms. Wiggan's no-fault benefits. She stated under oath at the hearing that on April 25, 1991 she had a letter mailed to Ms. Wiggan at her home address. She did not personally place this letter in the mail, but put it in the company's internal system to be delivered by Canada Post. This letter requested Ms. Wiggan to provide the Insurer with her 1990 tax return, expressed the Insurer's view that Ms. Wiggan was fit to resume work on April 12, 1991, and further stated that, once the Insurer received her tax return, it would adjust any incorrectly paid benefits and issue a final payment. I do not find that this letter amounts to a notice of denial, but it certainly creates a clear impression in my mind that the Insurer was going to cut off benefits soon afterwards.
The next letter that Ms. Doyle sent to Ms. Wiggan is the "Assessment of Claim By Insurer" form. On May 15, 1991, Ms. Doyle testified that she sent this form to Ms. Wiggan's home address. Again, Ms. Doyle stated that she sent the letter through Simcoe & Erie's internal mail system for delivery by Canada Post.
Under the weekly income benefits section on the "Assessment of Claim" form is an "X" in the box next to "entire claim denied". Below the box there is this explanation:
Based on the conflicting information on file, we require a copy of your 1990 income tax return to accurately assess your weekly benefit.
In the supplementary medical rehabilitation benefits section of the form, the Insurer placed another "X" in the box next to "entire claim denied", and explained:
Due to the conflicting medical evidence we have requested Rehab Services of Canada evaluate your home needs.
Ms. Doyle testified that neither of these letters were returned by Canada Post to Simcoe & Erie.
Ms. Wiggan argues that the Insurer's explanatory language on the assessment form contradicts the idea of a termination of benefits. According to Ms. Wiggan, the offer of an assessment of her home needs and request for her tax return in order to adjust the final payment indicate that benefits are continuing.
I do not agree with Ms. Wiggan. I find that the language "entire claim denied" is easily understood and unequivocally conveys the Insurer's intention to end benefits. In my view, the Insurer's efforts to gather information about Ms. Wiggan do not conflict with the expressed intention to end benefits.
The Insurer states that mailing the assessment form is the equivalent of receipt. This legal principle is generally referred to as the "mailbox rule" and provides that, in contract matters, notice is presumed to be delivered to a party on the date it is placed in the mail. Applying the "mailbox rule" to the facts of this case would mean that Ms. Wiggan was given notice of the Insurer's denial of her claim on May 15, 1991. I find that the "mailbox rule" should not be applied to the case before me.
Section 148(15) of the Insurance Act, provided in every motor vehicle insurance policy in this province, states:
Written notice may be given to the insured named in the contract by letter personally delivered to the insured or by registered mail addressed to the insured at the insured's latest post office address as notified to the insured.
In my view, section 148(15) of the Insurance Act indicates the legislature's intent that insurers provide their insureds with delivery of a notice, not mere postal deposit. The burden to prove delivery or deposit rests with the insurer.
Ms. Doyle's evidence reveals that she had put the assessment form in the Insurer's internal mail system, not Canada Post. I heard no evidence on the reliability or integrity of Simcoe & Erie's mailing system, and I am reluctant to accept the Insurer's mail handling as tantamount to placement in the national mail service without some supportive evidence on that system's functioning and integrity. The Insurer could have called Ms. Wiggan to testify about her receipt and understanding of the assessment notice. Ms. Wiggan attended the hearing, but unfortunately was not called as a witness by either party.
Without testimony from Ms. Wiggan confirming receipt of the notice or evidence that would more clearly demonstrate delivery, I find that the Insurer, on the balance of probabilities, has failed to prove that Ms. Wiggan had actual notice of the claim denial on May 15, 1991. Where an Insurer relies upon the two-year limitation period for filing arbitration, as set forth in section 281(5) of the Insurance Act, it is imperative that an insurer prove that the insured person received the notice of denial, as required by section 148(15) of the Insurance Act.
Simcoe & Erie has not proven the delivery of any notice denying Ms. Wiggan's claim, and accordingly she is not barred from proceeding to arbitration.
Order:
The Applicant may proceed to arbitration of the other issues in this matter.
The Applicant is entitled to her expenses of this hearing.
October 14, 1993
Fred B. Sampliner
Arbitrator
Date