Neutral Citation: 1996 ONICDRG 44

File No.: A95-000392

ONTARIO INSURANCE COMMISSION

BETWEEN:

F. S.

Applicant

and

Belair Insurance Company Inc.

Insurer

DECISION ON A PRELIMINARY ISSUE

Issues:

The Applicant, Mrs. F. S., was injured in a motor vehicle accident on September 30, 1993. She was involved in a subsequent motor vehicle accident on October 3, 1994. She applied for and received statutory accident benefits from Belair Insurance Company Inc. ("Belair"), payable under Ontario Regulation 672.¹ Weekly income benefits were terminated by Belair on February 4, 1995. The parties were unable to resolve their disputes through mediation, and the Applicant applied for arbitration with respect to both motor vehicle accidents, under the Insurance Act, R.S.O. 1990, c.I.8, as amended (the "Act").

The issues in this preliminary hearing are:

1. Has Mrs. S. made herself reasonably available for a medical examination required under section 23(2) of the Schedule with Dr. Jeffrey P. Wyndowe?

2. If Mrs. S. has not made herself reasonably available for a medical examination with Dr. Wyndowe, what are the consequences?

Result:

1. Mrs. S. has failed to make herself reasonably available for an examination required under section 23(2) of the Schedule with Dr. Jeffrey P. Wyndowe.

2. Mrs. S. is entitled to arbitrate her disputes with Belair. Mrs. S. is not precluded from proceeding with this arbitration.

Hearing:

The hearing was held in North York, Ontario, on February 13, 1996, by telephone conference, before me, Lawrence Blackman, Arbitrator.

Present at the Hearing:

Applicant's Representative:

Ms. Diane Parsons Barrister and Solicitor

Insurer's Representative:

Ms. Joanna M. Chadwick Barrister and Solicitor

No witnesses testified, nor were any exhibits entered at this preliminary hearing. Medical documentation, including copies of Dr. Wyndowe's curriculum vitae and his letter dated February 8, 1996 were before me. Also before me were two Reports of Mediator Andrew Hajsaniuk, both issued July 7, 1995, an Application for Arbitration dated August 11, 1995, and a Response to an Application for Arbitration dated October 23, 1995. An Agreed Statement of Facts was filed by the parties.

Authorities:

1. Dana B. Levenson and The General Accident Assurance Company of Canada, February 18, 1992, OIC File No. A-000260.

2. Edward J. Opatowski and Wawanesa Mutual Insurance, September 22, 1992, OIC File No. A-000381.

3. Rajendra Ramjeet and State Farm Mutual Automobile Insurance Company, December 23, 1993, OIC File No. A-004685.

Counsel were also referred to a series of cases pertinent to the preliminary issues in this proceeding.²

Evidence and Findings:

Background Facts:

The facts relevant to this preliminary hearing, as agreed both in writing and orally by the parties, are as follows.

Mrs. S. was injured in a motor vehicle accident on September 30, 1993. She was involved in a subsequent motor vehicle accident on October 3, 1994.

Belair was Mrs. S.'s automobile insurer at the time of both accidents. As a result of injuries she sustained in the September 30, 1993 accident, Belair paid Mrs. S. weekly benefits, pursuant to section 13 of the Schedule, from October 8, 1993 to February 4, 1995.

Mrs. S. was seen on February 1, 1994, by Dr. Allan C. Gold, an orthopaedic surgeon, in an insurer's medical examination held under the authority of section 23(2) of the Schedule. Mrs. S. attended a further insurer's medical examination on January 27, 1995, with Dr. Rajka Soric, a specialist in rehabilitation medicine. Both specialists saw Ms. S. in respect of her physical complaints.

Belair terminated payment of Mrs. S.'s weekly benefits as a result of Dr. Soric's report. Mrs. S. thereupon filed Applications for Appointment of a Mediator, dated March 8, 1995. A joint mediation proceeded, culminating in two reports of Mediator Andrew Hajsaniuk, both issued July 7, 1995. The reports indicate that issues not resolved at mediation included Mrs. S.'s claim of entitlement to weekly benefits pursuant to section 13 of the Schedule, and her claim for entitlement to "other disability benefits" pursuant to Part 5 of the SABS, both ongoing from February 4, 1995.

Mrs. S. subsequently applied for arbitration with respect to both accidents, by application dated August 11, 1995.

Mrs. S. alleges that as a result of the two motor vehicle accidents, she has suffered, and continues to suffer from severe depression, which escalated to such a degree that on or about April 10, 1995, she attempted to commit suicide. In 1995, Mrs. S. was assessed by Dr. V.P. D'Agata, a psychiatrist. Since on or about April 10, 1995, Mrs. S. has seen Dr. Owen Giddens for psychotherapy, initially once a week, and, following a second suicide attempt on or about June 13, 1995, twice a week. Mrs. S. has also been prescribed Prozac for depression.

By letter dated December 14, 1995, Belair advised Mrs. S.'s counsel, that arrangements had been made for Mrs. S. to be assessed on March 25, 1996 by Dr. Jeffrey P. Wyndowe, a qualified medical practitioner with a specialty in psychiatry. This was Belair's first request that Mrs. S. attend at an insurer's psychiatric examination. Counsel agreed that the request for the examination with Dr. Wyndowe, was only made pursuant to section 23(2) of the Schedule, and was not made pursuant to section 65 of the SABS.

By letter dated January 8, 1996, Mrs. S.'s counsel advised Belair that the Applicant would not be attending Dr. Wyndowe's examination.

The joint arbitration herein is scheduled to proceed on June 3 to June 6, 1996.

The Law:

1. Has Mrs. S. made herself reasonably available for an examination required under section 23(2) of the Schedule, with Dr. Jeffrey P. Wyndowe?

Where an insured person makes a claim for weekly benefits under Part IV of the Schedule, the insurer has specific statutory rights to have the insured examined by a doctor of the insurer's choice. These rights are set out in section 23(2) of the Schedule as follows:

23. (2) In respect of claims under Part IV, the insurer may, on reasonable notice, require an examination of the insured person by a qualified medical practitioner, psychological advisor or chiropractor as often as it reasonably requires, and require an autopsy of a deceased insured person in accordance with the law relating to autopsies.

The statutory consequence of an insured person failing to attend a reasonably required insurer's medical examination, is set out in section 25 of the Schedule:

25. No person may commence a mediation proceeding under section 280 of the Insurance Act in respect of benefits under this Schedule unless the requirements of section 22 havebeen satisfied and the insured person has made himself or herself reasonably available for any examination required under section 23.

[emphasis added]

The first issue therefore involves questions of reasonableness. Did Belair give Mrs. S. reasonable notice. Is the examination by a qualified medical practitioner reasonably required? If so, has Mrs. S. made herself reasonably available for this examination?

It was conceded by Mrs. S.'s counsel that Belair had provided reasonable notice of Dr. Wyndowe's appointment. No objection is raised as to the reasonableness of Belair's choice of Dr. Wyndowe.

The Applicant however submits that the proposed examination is unreasonable as two insurer medical examinations have already been conducted. Furthermore, it is argued that the purpose of a section 23(2) medical examination is to allow an insurer an opportunity to evaluate an insured's claim. It is submitted that Belair could have requested a psychiatric examination much earlier than it did, and that therefore the reason for the request at this late date is to defend against Mrs. S.'s claim. The Applicant's argument, as I understand it, is that as the reason for requesting the examination is improper, the request itself is unreasonable.

I do not agree with this submission.I concur with the comments of Senior Arbitrator Naylor (as she then was) in the Scott³ decision, that "reasonableness" is an objective, not a subjective standard. I further agree with her comments that:

The right of an insurer to require that the Applicant attend a medical examination under section 23(2) provides the insurance company with an effective opportunity to fairly assess the applicant's medical condition, on an independent basis.

It is not for an arbitrator to "second-guess" the actions or motives of the company in requiring a medical examination.

It has now been more than a year since the Insured has attended at an insurer medical examination. The emotional and psychiatric condition of the Insured has become extremely important since that time. The Insurer has never assessed the Insured's psychiatric medical condition, on an independent basis. I therefore find it fair, and hence reasonably required, for the Applicant to attend the March 25, 1996 examination scheduled with Dr. J. Wyndowe, a qualified psychiatrist. I find that reasonable notice has been given of this appointment. I further find that no reasonable explanation has been given by the Applicant to excuse such an attendance. Therefore, by her refusal to attend at this examination, I find that Mrs. S. has not reasonably made herself available for an examination required under section 23(2) of the Schedule.

2. Is Mrs. S. entitled to arbitrate her disputes with Belair, and is Belair entitled to the return of its assessment paid in respect of this matter?

Having found that Mrs. S. has not made herself reasonably available for the Insurer's psychiatric examination, I must determine whether certain legal consequences thereby follow.

Belair firstly submits that if the Applicant fails to make herself reasonably available for Dr. Wyndowe's examination, she is not entitled to arbitrate her disputes with Belair, and Belair is thus entitled to the return of its $2,000.00 assessment. In support of this proposition Belair relies on Senior Arbitrator Rotter's decision in Opatowski⁴, wherein reference was made to section 281(2) of the Act which states:

(2) No person may bring a proceeding in any court or refer a matter to arbitration unless mediation has first been sought and has failed.

In light of that provision, and section 25 of the Schedule (which specifically prohibits an insured person from commencing a mediation proceeding, unless the insured has made himself or herself reasonably available for a section 23 examination), Senior Arbitrator Rotter determined that:

In effect, the intention of the statutory scheme appears to be to deny formal access to the dispute resolution system to an insured person who fails to comply with the insurer's reasonable requirement for an independent medical examination.

Senior Arbitrator Rotter thus concluded that:

Therefore, I find that the effect of the Applicant's failure to make himself reasonably available for a medical examination is that he may not commence a mediation proceeding. Since he may not commence a mediation proceeding, it follows that he may not refer this matter to arbitration, pursuant to section 242c(2) [sic] and, accordingly, I have no jurisdiction to hold a hearing in this matter.

[emphasis added]

As there was no jurisdiction to hold an arbitration in Opatowski, there was no jurisdiction for making the $1,000.00 assessment (as it then was), which was therefore returned to the insurer.

However in the Opatowski decision, it appears that the request for the section 23 insurer medical examination was made prior to the commencement of mediation. Opatowski is thus a case where jurisdiction never existed, because the insured, by failing to make himself reasonably available for an insurer medical examination, failed to comply with a condition precedent to formally accessing the dispute resolution system. Although it is clear in Opatowski that the section 25 argument was raised by the insurer during mediation, the failure of the insurer to raise the section 25 defence until a later date would not have bestowed jurisdiction upon the process.

In this case however, the request for the now refused section 23 examination was made only after the commencement of mediation, and indeed, only after the commencement of arbitration. Therefore, there is no question that the Mediator had jurisdiction to conduct the mediations herein. I do not accept that section 25 can operate to set aside established jurisdiction. Section 25 can serve only to deny insured persons initial access to the dispute resolution system.

Therefore, as the Mediator had jurisdiction to conduct the mediations herein, and as mediation has failed, Mrs. S. is entitled, pursuant to section 281(2) of the Act, to arbitrate her dispute with Belair. Accordingly, Belair is not entitled to the return of its assessment paid in respect of this matter.

3. Is Mrs. S. precluded from proceeding with this arbitration unless she makes herself reasonably available for a medical examination with Dr. Wyndowe?

Belair further submits, in the alternative, that Mrs. S. is precluded from proceeding with this arbitration, unless she makes herself reasonably available for a medical examination with Dr. Wyndowe. Belair relies on the Hanna decision.⁵In HHanna, Arbitrator Draper (as he then was), stated:

Section 23(2) applies to claims for weekly benefits. Where, as in this case, the applicant is asserting an ongoing claim, I believe that the insurer is meant to have a reasonable opportunity to evaluate the claim . . .

Section 25 should be interpreted in light of this purpose. Section 25 states that an applicant cannot access the dispute resolution process at all until he or she has made himself or herself reasonably available for a medical examination. In light of the purpose of section 23(2), I believe that it follows that an applicant cannot proceed through the dispute resolution process unless he or she makes himself or herself reasonably available for a medical examination

For these reasons, I conclude that section 23(2) remains available to an insurer after weekly benefits have been terminated and the applicant has applied for mediation. However, the medical examination must be for the purpose of evaluating the applicant's ongoing claim and must be reasonable.

Arbitrator Draper relied on the reasoning in the Ontario Court of Appeal decision of Rysyk v. Booth Fisheries Canadian Co. Ltd. et al. (1970), 1970 CanLII 510 (ON CA), 14 D.L.R. (3d) 539, which held that a provision in the Judicature Act should be interpreted "quite broadly in order to achieve the legislative purpose of providing a discovery process that would facilitate a fair trial and a just result."⁶

With respect, I disagree that section 23 should be interpreted as having such a legislative purpose. The Schedule is not a procedural code. It does not set out rules for the conduct of an arbitration proceeding. Section 25 does not mandate defence medical examinations in an adversarial discovery process. Rather, section 25 is part of a statutorily mandated schedule affixed to motor vehicle liability policies, and is concerned with a question of jurisdiction, that is initial access to the dispute resolution process.

Elmer A. Driedger, in Construction of Statutes, 2nd ed. (Toronto: Butterworths, 1983), stated (at page 105) that the first step in statutory construction is to read the Act as a whole in its entire context, so as to ascertain the intention of Parliament, and the object and scheme of the Act. The next step in statutory interpretation is as follows:

The words of the individual provision to be applied to the particular case under consideration are then to be read in their grammatical and ordinary sense in the light of the intention of Parliament embodied in the Act as a whole, the object of the Act and the scheme of the Act, and if they are clear and unambiguous and in harmony with that intention, object and scheme and with the general body of the law, that is the end.

I find that the Schedule provides insurers with a restricted right to require intrusive medical examinations or insured persons to assist in the insurer's determination of entitlement, a decision that may lead to the commencement of a mediation proceeding. The intent of the Schedule is not to enforce insurer medical examinations to assist the judicial determination of entitlement, once a decision to deny benefits has been made, and mediation has been commenced.

The words "commence a mediation proceeding" in section 25 of the Schedule, when read in their grammatical and ordinary sense, are clear and unambiguous, and denote the start of, or the initial access to mediation, which is the first step in the dispute resolution system. Such a meaning is in harmony with the intention, object and scheme of the Schedule, as a component of a policy of automobile insurance, and not a code of civil procedure. I find that to interpret the words "commence a mediation proceeding" to mean "proceed through the dispute resolution process," is to give the words a meaning, with respect, that they are not capable of bearing.

Accordingly, I find that, as the Insurer's request for a psychiatric examination followed the commencement of the mediation proceeding herein, I have no authority to preclude the Applicant from proceeding with her arbitration. The arbitrator at the main hearing may however consider whether to draw an adverse inference from the failure of the Applicant to make herself reasonably available for the medical examination with Dr. Jeffrey P. Wyndowe, required by the Insurer under section 23(2) of the Schedule.

Expenses:

I reserve to the main hearing of this arbitration proceeding, the issue of expenses of this preliminary hearing.

Order:

1. Mrs. S. has failed to make herself reasonably available for a medical examination required under section 23(2) of the Schedule, with Dr. Jeffrey P. Wyndowe.

2. Mrs. S. is entitled to arbitrate her disputes with Belair. Mrs. S. is not precluded from proceeding with this arbitration.

March 12, 1996

Lawrence Blackman Arbitrator

Date

Footnotes

1. 1Prior to January 1, 1994, Ontario Regulation 672 was called the No-Fault Benefits Schedule. After that date it became the Statutory Accident Benefits Schedule — Accidents Before January 1, 1994. In this decision, the term "Schedule' will be used to refer to Regulation 672. The term "SABS" will be used in this decision to refer to Ontario Regulation 776/93, which is the Statutory Accident Benefits Schedule - Accidents on or after January 1, 1994.
2. 2Kevin Hanna and Royal Insurance Company of Canada, December 2, 1994, OIC File No. A-005409, Jose Granchelli and Royal Insurance Company of Canada, October 4, 1995, OIC File No. A-015225, Dorian Gallo and Royal Insurance Company of Canada, December 4, 1995, OIC File No. A-001378, and George A. Kota and Wawanesa Mutual Insurance Company, December 22, 1995, OIC File No. A-012031.
3. 3Patricia Scott and Toronto Transit Commission (Markel Insurance), September 4, 1992, OIC File No. A-001116.
4. 4Edward J. Opatowski and Wawanesa Mutual Insurance, September 22, 1992, OIC File No. A-00038110
5. 5Kevin Hanna and Royal Insurance Company of Canada, December 2, 1994, OIC File No. A-005409. Hanna was followed in the decisions ofJose Granchelli and Royal Insurance Company of Canada, October 4, 1995, OIC File No. A-015225, Dorian Gallo and Royal Insurance Company of Canada, December 4, 1995, OIC File No. A-001378, and George A. Kota and Wawanesa Mutual Insurance Company, December 22, 1995, OIC File No. A-012031.
6. 6Hanna, op. cit., p.8.