Lorna Howden v. Pembridge Insurance Company (Pafco Ins. Co.), 2001 ONFSCDRS 147

FINANCIAL SERVICES COMMISSION OF ONTARIO

Neutral Citation: 2001 ONFSCDRS 147 FSCO A01-000333

BETWEEN:

LORNA HOWDEN Applicant

and

PEMBRIDGE INSURANCE COMPANY (PAFCO INS. CO.) Insurer

DECISION ON A PRELIMINARY ISSUE

Before: Fred Sampliner Heard: By telephone conference call on October 1, 2001.

Appearances: David S. Wilson for Ms. Howden Grant R. Dow for Pembridge Insurance Company (Pafco Ins. Co.)

Issues:

Pembridge Insurance Company ("Pembridge") moved to prevent Ms. Lorna Howden from proceeding to the arbitration hearing¹ on the merits of her claim for ongoing disability benefits under the Schedule² on the basis that she refused to attend the Insurer's health care and vocational examinations.

The preliminary issue is:

1. Is Ms. Howden stayed from proceeding to the arbitration hearing as a result of her refusal to attend Pembridge's examinations?

Result:

1. Ms. Howden's arbitration hearing is not stayed as a result of her refusal to attend Pembridge's examinations.

EVIDENCE AND ANALYSIS:

Pembridge paid Ms. Howden a weekly disability benefit until October 25, 2000, terminating her entitlement based on functional, psychological and vocational assessments she had undergone the previous month, at the Insurer's request. Ms. Howden's claim for further disability benefits was mediated between December 2000 and February 2001. Her application for arbitration of the dispute was filed shortly thereafter. The June 19, 2001 pre-hearing was followed in August by a hearing on Ms. Howden's unsuccessful motion for interim benefits.

Insurers can require claimants to be examined by health or vocational specialists as often as is reasonable in the circumstances.³ On September 11, 2001 Pembridge's lawyer requested through Ms. Howden's counsel that she attend for further assessments at West Park Healthcare Centre (West Park).

The contemplated examinations were very extensive: a one and a half hour physiatry examination on September 26, 2001, an eight-hour psycho-vocational examination on September 27, 2001, a six-hour functional capacity evaluation on September 28 and 29, 2001 and approximately 21 hours of "situational" functional testing spread out over October 2, 4, and 6, 2001. West Park anticipated that the report would be complete by Monday, November 12, 2001, exactly one week prior to the commencement of the November 19, 2001 hearing.

Ms. Howden refused to attend these insurer examinations. She argues there is no evidence that her health changed after the last comprehensive insurer examinations and that the passage of a year does not automatically entitle Pembridge to another one. Ms. Howden maintains that these examinations, occurring immediately before the hearing, are a blatant attempt to bolster the Insurer's case. Moreover, Ms. Howden argues, delivering the reports to her during the week before the hearing would prejudice her ability to adequately respond to the new reports or alternatively she would be forced to seek an adjournment of the hearing to properly prepare her response.

Pembridge acknowledges that their anticipated service of the West Park reports would not conform to Rule 39 of the Dispute Resolution Practice Code, which requires that expert reports be served on an opposing party no later than 30 days before commencement of the hearing. The reports would be excluded from evidence at the scheduled hearing since they would not be served on Ms. Howden within the allowable time period, unless the hearing arbitrator ordered otherwise or Ms. Howden agreed to include this evidence.

Pembridge submits it did not plan the examinations to either surprise Ms. Howden so she could not respond adequately or to delay the case. Counsel submitted that Pembridge began setting up the evaluations with West Park after the June 19, 2001 pre-hearing, but encountered unforseen scheduling difficulties with this health facility.

Pembridge did not explain to my satisfaction why it did not act more expeditiously to schedule insurer examinations either before the pre-hearing or during the three months following that event.⁴ I am not persuaded that Pembridge could not have found an alternative expert to conduct the examinations and provide Ms. Howden with reports within the required disclosure period before the commencement of the scheduled hearing.

Pembridge received an updated report from Ms. Howden's physiatrist, Dr. Veronica Kekosz, on September 26, 2001. Pembridge argues it should have an opportunity to have a corresponding report from its own expert to present at the hearing.

Pembridge does not allege that Dr. Kekosz changed her opinion, and nothing suggests that Ms. Howden's condition changed after the time of the last comprehensive insurer examinations in September 2000. I am not persuaded that these examinations were reasonably necessary to address new health or disability issues.

Pembridge's argument that its recent receipt of Dr. Kekosz' report constitutes a reasonable basis to examine Ms. Howden is not persuasive. The company's receipt of Dr. Kekosz' report two months before the hearing provides sufficient time to prepare the Insurer's response, and there appear to be no new issues here to address in any case. I agree with Arbitrator Wilson that at some point the examination process must stop.⁵ Nothing prevents Pembridge from having its own experts conduct a paper review.

Conclusion:

The current version of the Dispute Resolution Practice Code increased the disclosure period for expert reports from 10 to 30 days before the hearing. Clearly, the intent of this change is to prevent surprise from late delivery of expert reports and provide parties with adequate time to prepare their case in advance of the hearing.

Arbitrators have sought to balance the insurer's need to periodically update its health information against the inconvenience or invasion of the insured person's life together with the timing of the examinations.⁶ In my view, insurer examinations are not reasonable where the reports abridge the insured person's preparatory time under the Code.

Pembridge did not offer any substantive evidence or plausible submission that Ms. Howden would not be prejudiced by the late service of the West Park reports. If Ms. Howden had attended the examinations her experts and counsel would have had to scramble to address the reports in order to proceed with the scheduled hearing dates or, alternatively, seek an adjournment and consequently delayed the hearing of her claim.

I find that late delivery of the reports from Pembridge's examinations would cause prejudice to Ms. Howden's ability to proceed with the scheduled hearing dates or would not allow her the amount of preparatory time intended to be provided her under the Code. Thus, I find that Pembridge's request for Ms. Howden to attend the September and October 2001 examinations is not reasonable, and that she may proceed to the currently scheduled arbitration hearing.

EXPENSES:

I leave the expense issue to the hearing arbitrator.

October 5, 2001

Fred Sampliner Arbitrator

Neutral Citation: 2001 ONFSCDRS 147 FSCO A01-000333

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

LORNA HOWDEN Applicant

and

PEMBRIDGE INSURANCE COMPANY (PAFCO INS. CO.) Insurer

ARBITRATION ORDER

Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:

1. Ms Howden can proceed to the arbitration hearing commencing on Monday, November 19, 2001.

October 5, 2001

Fred Sampliner Arbitrator

Footnotes

1. 1Under the Insurance Act, R.S.O. 1990, c.I.8
2. 2The Statutory Accident Benefits Schedule — Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended by Ontario Regulations 462/96, 505/96, 551/96 and 303/98.
3. 3Section 42 of the Schedule
4. 4Talbot and Lumbermens Mutual Casualty Company (FSCO No. A98-000104, June 4, 1999)
5. 5Barreira and Allstate Insurance Company of Canada (FSCO No. A00-00079, June 30, 2000)
6. 6Levey and Traders General Insurance Company (OIC No.A 96-001590, June 30, 1998)