Neutral Citation: 2001 ONFSCDRS 173

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FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

J. V.

Applicant

and

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY

Insurer

DECISION ON A MOTION

Before:

Tanja Wacyk

Heard:

By telephone conference call on August 10, 2001.

Appearances:

Chris Nicolis for J.V.

Matthew G. Duffy for State Farm Mutual Automobile Insurance Company

Issues:

The Applicant, J.V., was injured in a motor vehicle accident on August 18, 1993. She applied for statutory accident benefits from State Farm Mutual Automobile Insurance Company ("State Farm"), payable under the Schedule.¹ J.V. claims the following:

(i) weekly benefits pursuant to Section 13 of the Schedule;

(ii) payment for housekeeping expenses;

(iii) payment for dental expenses;

(iv) entitlement to rehabilitation services.

Her entitlement was disputed by State Farm. The parties were unable to resolve their disputes through mediation, and J.V. applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended. In preparation for the arbitration, State Farm brought a motion seeking the following:

(v) production of the Applicant's discovery transcript in the third party (tort) action;

(ii) production of the defence medical examination reports generated from the Applicant's tort action;

(iii) an order staying the arbitration until J.V. attends an insurer's psychiatric examination.

Result:

1. J.V. is not required to produce her discovery transcript in the Third Party (tort) action;

2. J.V. is not required to produce the defence medical examination reports from the Applicant's tort action.

3. It is not reasonable for State Farm to require J.V. to attend an insurer's psychiatric examination.

4. The matter of expenses is left to the hearing arbitrator.

I. Production of the Discovery Transcript and the Defence Medical Examination reports from the tort action:

Agreed Statement of Facts:

With regard to the production of the discovery transcript and the defence medical examination reports from the Tort Action, the parties filed the following agreed statement of facts:

1. On August 16, 1995, the Applicant, [J.V.], commenced an action for damages against Vicki Chilton, the driver of the other vehicle involved in the subject motor vehicle collision.

2. On June 13, 1996, [J.V.] attended an examination for discovery in the tort action.

3. On March 9 and 10, 1998, [J.V.] attends for an insurer's examination with Dr. Michel Lacerte, specialist in physical medicine and rehabilitation.

4. In August of 1999, [J.V.] attends for defence medical examinations by Dr. Peter Fowler and Dr. Sandy Kirkley, each of whom are specialists in orthopaedic medicine. Dr. Fowler examined [J.V.] in connection with her lower extremities. Dr. Kirkley assessed [J.V.] in regards to her right shoulder. Both of these examinations were conducted at the behest of the tort defendant.

5. There have been no further defence medical examinations in the tort action. There are no further defence medical examinations pending.

6. [J.V.] has agreed to attend an insurer's orthopaedic examination with Dr. David Taylor.

7. [J.V.] does not intend to rely upon the opinions of Dr. Fowler or Dr. Kirkley in this arbitration proceeding. The reports are not favourable to [J.V.] and she does wish [sic] to be prejudiced by them in this proceeding.

8. The insurer has been or will be provided with all of the post-accident notes and records from [J.V.]'s treatment providers.

The Law:

Both parties agreed Rule 30.01of the Rules of Civil Procedure, the "implied undertaking rule," does not apply to an arbitration proceeding commenced before the Financial Services Commission of Ontario.²

However, it was also uncontested that, as articulated in the judgment of Morden, A.C.J.O. in Goodman v. Rossi,³ Rule 30.01 essentially codifies the existing law in Ontario with respect to implied undertakings. In that decision, Morden A.C.J.O. adopted the following statement of the common rule in Matthews and Malek's Discovery (1992) at p.253:

The primary rationale for the imposition of the implied undertaking is the protection of privacy. Discovery is an invasion of the right of the individual to keep his own documents to himself. It is a matter of public interest to safeguard that right. The purpose of the undertaking is to protect, so far as is consistent with the proper conduct of the action, the confidentiality of a party's documents. It is in general wrong that one who is compelled by law to produce documents for the purpose of particular proceedings should be in peril of having those documents used by the other party for some purpose other than the purpose of the particular legal proceedings and, in particular, that they should be made available to third parties who might use them to the detriment of the party who has produced them on discovery. A further rationale is the promotion of full discovery, as without such an undertaking the fear of collateral use may in some cases operate as a disincentive to proper discovery.

The implied undertaking rule provides, essentially, that all parties and counsel are deemed to undertake not to use evidence or information obtained from documentary discovery, examination for discovery, inspection of property, or medical examination, other than for those proceedings in which the evidence was obtained.

However, if satisfied that the interests of justice outweigh any prejudice that would result to a party who disclosed evidence, a court may order that the implied undertaking rule does not apply to the evidence or to information obtained from it, and may impose such terms and give such directions as are just.⁴

Argument:

State Farm:

State Farm argued that, in this instance, the tort and no-fault proceedings arise from the same accident and focus on similar issues i.e. injuries, disability, treatment, employment and income. Thus the information sought was for a related cause of action, and not for a new proceeding or collateral or improper purpose. Thus, State Farm maintained that its request does not give rise to the same concerns as when this is not the case.⁵

State Farm also maintained that information from the tort action should be made available to avoid the potential "miscarriage of justice" in the event an arbitrator reached an inconsistent result regarding the applicant's disability.

State Farm also emphasized the importance of producing relevant medical information where damages are claimed for injuries.⁶

In making its argument, State Farm relied on the determination in Lamb v. Hyde.⁷ In that instance, the plaintiff had commenced separate actions for no-fault benefits and for tort damages. The tort defendants sought production of the independent medical examination reports generated in the accident benefits action. Mr. Justice McDermid acknowledged the implied undertaking rule, but held that the independent medical examination reports were relevant and material to the issue of damages and should be produced.⁸

State Farm acknowledged that the Ontario Divisional Court reached a different conclusion in London Life Insurance Co. v. Konney.⁹ However, the Insurer distinguished that case on the basis that production was sought for the collateral purpose of launching new and different proceedings, whereas in the instance case, production was sought merely on the basis of relevance and utility to State Farm in its defence.

In that instance, London Life, the disability insurer, had brought an action alleging the defendant had improvidently settled a tort action involving his disability, leaving London Life responsible to continue its monthly disability payments. The court found that London Life sought the medical reports from the tort actions in an attempt to reconstitute the claim from one of bad faith alone, to include a component of insurance claim litigation, so as to terminate the defendant's benefits on the basis that he was not disabled.

The court found the documents were "inescapably central to the bad faith action," and their compulsory production for that purpose was a "legitimate and principled extension" of the defendant's privacy interest. However, the court refused to allow their use in an action to terminate the defendant's disability benefits, as it would offend the policy principles on which the implied undertaking rule is based.

State Farm further relied on Brown v. MacKeen¹⁰ and Binns v. Peters et al.¹¹ In both instances, the court ordered the production of materials from what appeared to be accident benefits files.¹² for the purposes of tort litigation.

In Brown, Justice Wright noted that the documents were not sought for an unrelated cause of action or some collateral or ulterior purpose. Rather, the court viewed the proceedings as very closely related as they were brought by the same plaintiff, arose out of the same accident, and involved similar issues of damages. Justice Wright held that the use of the documents was legitimate and justified for disposing of the tort matter fairly.

In Binns, the third party was both the defendant's liability insurer and the plaintiff's accident benefits insurer. Justice J. MacDonald also found that the insurer in the tort action was entitled to make use of the opinion of its accident benefits medical examiners:

While different criteria govern entitlement to accident benefits and to tort damages, the regulatory and statutory enactments in issue address the same subject matter: medical assessment of an injured person seeking compensation. One person is being examined in respect of her injuries by one insurer... Since the medical reports prepared in respect of the accident benefits claims are admissible in evidence in this tort action, the potential burden on a plaintiff of excessive medical examination by the same insurer, acting in different capacities, is a factor in the application of both the Insurance Act and its regulation, the Statutory Accident Benefits Schedule, and the Courts of Justice Act and its regulation, the Rules of Civil Procedure.

In my view, where two or more statutes enacted by a legislature and regulations made or approved under an Act of a legislature address the same subject-matter without constituting a single scheme, they are "presumed to operate together harmoniously and to reflect a consistent view of the subject in question."

State Farm also referred to discrepancies in information conveyed by J.V. to examiners, as well as its surveillance evidence, to indicate her credibility is in issue. State Farm submitted that the transcript and medical examinations from the tort action are necessary to test J.V.'s credibility, and noted that production for that purpose was ordered in Chin and Coseco Insurance Co.¹³

State Farm pointed out that it was not arguing that it was prejudiced by the lack of production of the transcript and medical reports. Rather its position was that whatever prejudice to J.V. may exist, it cannot outweigh the interests of justice - and that the principle of full disclosure is paramount to J.V.'s privacy issues.

State Farm acknowledged that the recent decision of Madam Justice Leitch in Reimer v. Christmas,¹⁴ contradicted the decision in Lamb v. Hyde. In that case, Madam Justice Leitch held that the tort defendant was not entitled to the medical report prepared for the no-fault insurer on the basis that the privacy issue outweighed any prejudice that would result to the defendant. However, State Farm argued that this was a decision which flowed against the stream of contrary decisions and noted that leave to appeal was granted on July 11, 2001, on the basis that clarification of the law is needed.

Finally, State Farm noted that historically, parties readily exchanged documents from the tort and accident benefits file and that it was only recently such production was being resisted.

J.V.:

J.V. conceded that the documents sought were relevant.

J.V. argued that pursuant to the principles articulated in Goodman v. Rossi,¹⁵ State Farm must show that a greater injustice would result if the transcript and medical reports were not produced than if they were. J.V. maintained that as she was compelled to attend the defence medicals in order to proceed with her case, their use in these proceedings are exactly what the rule was designed to address. She emphasized that State Farm is a third party and that concern regarding use by a third party was specifically referred to in Goodman v. Rossi.

J.V. relied on London Life Insurance Co. v. Konney¹⁶ and Reimer v. Christmas,¹⁷ to argue that the implied undertaking rule applies even though the effect would be to countenance the concealment of relevant evidence.

J.V. also relied on Reimer v. Christmas¹⁸ and Tanner v. Clark¹⁹ to argue that State Farm is not in any way prejudiced by refusal to grant relief from the implied undertaking rule, as it could and has availed itself of the right to have the plaintiff assessed independently by medical examiners of its choice.

J.V. also pointed out that leave to appeal has been granted in Reimer,²⁰ for the purpose of clarification, and it is clear that Mr. Justice Hockin, while granting leave, was in agreement with the determination in both those cases. The text from that decision reads:

The Orders of Leitch, J. and Brown, J. do not stand with the reasons for Order of McDermid J. in Lamb v. Hyde. They are conflicting decisions on this important issue. It is my view too facile to say that Lamb is of no importance or application because it was decided before Goodman v. Rossi and the incorporation of the present implied undertaking rule - Rule 30.1.01. The rule codifies the common law. Browne, J. and Leitch, J. fell back on the common law (correctly in my view) and it is clear from the reasons of McDermid J. he considered the common law on the implied undertaking and the policy considerations therefrom. Beyond that, it is clear that injured plaintiffs and insurers will now "pick and choose" so to speak which route to take and that can not be. Clarification is required in the full context of the Rule, Goodman v. Rossi and the policy considerations there reviewed and the risk that wide open production of medical reports and records, on the basis of relevance only, may cause an imbalance in the fair prosecution and defence of injury cases...

This of course applies with equal force to Tanner. Appeal to proceed with dispatch...

J.V. noted that in Reid and Royal & SunAlliance Insurance Co. of Canada,²¹ Arbitrator Blackman granted relief from the implied undertaking rule in connection with the defence medical reports generated in a separate tort action. In doing so, he noted there was no provision under the Schedule for insurers' or Designated Assessment Centre examinations for the medical issues in dispute, and that without production of the medicals sought, the insurer, in that instance, would be significantly prejudiced in responding to the application for arbitration.

J.V. questioned the correctness of that decision, and maintained that in any event, it should not be applied in this instance as State Farm can and has availed itself of its right to have J.V. assessed independently by medical examiners of its choice, i.e. Dr. Michele Lacerte, a physiatrist, and Dr. David Taylor, an orthopaedic surgeon (scheduled for October 2001).

Consequently, J.V. argued that the production of the reports of Dr. Fowler and Dr. Kirkley is not in any way necessary to the Insurer in its defence in this process.

J.V. also maintained that rather than being distinguishable, as argued by State Farm, this situation is the same as that in London Life.²² in that the State Farm now wanted to use documents from another proceeding to deny benefits to J.V. J.V. argued that, as in that case, State Farm could rely on its contractual rights to obtain information from and about J.V. She also pointed out that State Farm had received the medical information to which it was entitled pursuant to the Schedule and the Dispute Resolution Practice Code.

The Applicant further argued that State Farm was trying to do indirectly what it could not do directly, and to grant relief from the rule would allow the Insurer to double up on defence medicals. In making that argument, J.V. referred to the case of Lucenti v. Progressive Casualty Insurance Co. of Canada.²³

However, I am satisfied that the Lucenti decision can be distinguished on its facts in that a decision had been made to proceed with the tort and the accident benefits matters before separate judges, and Mr. Justice Misener was concerned that an order for production of the medical legal reports would undermine that agreement. Also, a request for additional insurer's examinations had already been denied by the court.

J.V. also relied on Lucenti to argue that an exemption should not be granted regarding the transcript from her examinations for discovery. However, in that case, a discovery had already been conducted in both the tort and the accident benefits actions. Consequently, Mr. Justice Misener was of the view that little would be gained, other than "some sort of a comparative analysis," and refused the exemption.²⁴ This is not the case in this instance.

J.V. pointed out that the order to produce the transcript of the examination for discovery in Chin and Coseco Insurance Co.,²⁵ was based on a determination that it would be unfair to deny the insurer an opportunity to employ the transcripts to test the applicant's credibility. She argued that as credibility is an issue in essentially every case, this should not be sufficient to found a decision to grant relief from the implied undertaking rule. She also pointed out that while Rule 30.1(6)²⁶ allows for the use of evidence obtained in one proceeding, or information obtained from such evidence to be used to impeach the testimony of a witness in another proceeding, this presupposes that the party is already in possession of the evidence - as was the case in Chin. However, this is not so in this case.

J.V. also pointed out that the Dispute Resolution Practice Code makes no provision for oral examination for discovery. Consequently, discoveries are not part of the arbitration process. She argued that this is the case because arbitration is to be a more expeditious process, and it is for those reasons parties select this forum. If transcripts from oral discoveries are producible, then this would lengthen the process.

Finally, the Applicant maintained that because materials from tort and accident benefit files had been provided in the past without consideration of the implied undertaking rule, this should not be interpreted to mean that the rule does not apply.

Analysis:

It was not disputed that this Commission has the discretion to grant relief from the implied undertaking rule. Section 20 of the Insurance Act authorizes arbitrators to decide any question of fact or law brought before them. Furthermore, section 22 provides arbitrators with a clear authority parallel to that vested in the court to, amongst other things, order the production of documents.

The jurisprudence regarding the application of the implied undertaking rule in circumstances involving both tort and accident benefits litigation is unsettled.

The implied undertaking rule addresses the valid issues of protecting the privacy of litigants who are compelled to provide information they would not offer up in other circumstances, and through that protection, the facilitation of full and honest disclosure in the course of litigation. In Goodman v. Rossi,²⁷ the court adopted a statement, set out at page 4 of this decision, expressing particular concern regarding the inappropriateness of making documents available to third parties who might use them to the detriment of the party who has produced them under the compulsion of law in the process of discovery.

Consequently, I share the view of Lederman J. in Livent.²⁸

Lederman J. noted that under rule 30.1.01(8), relief from the deemed undertaking rule can only be given in instances where the interests of justice outweigh any prejudice to the party who disclosed the evidence.

In that case, as in this, it was a non-party that requested the waiver of the deemed undertaking rule.²⁹ Lederman J. held that the burden on third parties is a heavy one, and not solely one of prejudice to the discovered party. Rather, he stated at page 130 as follows:

Although the prejudice to the discovered party is to be considered in the balancing of interests, there is a presumption that the integrity of the rule is to be preserved unless the party seeking relief therefrom can first demonstrate that the interests of justice will be fostered by disclosure. The words of Morden A.C.J.O. in Goodman v. Rossi, supra, at p. 377-78, make this clear:

Certainly, the accepted grounds for granting relief from the implied undertaking rule should not be so broadly based that the integrity of the rule is routinely infringed.

I agree an interpretation of the implied undertaking rule which could result in "routine infringement" of the rule in cases involving accident benefits files and parallel tort actions is not appropriate. In my view, it is not sufficient that, as State Farm argued, the tort and no-fault proceedings arise from the same accident and focus on the same issues. This will often be the case. However, different facts may lead to different conclusions regarding how the interests of justice will best be fostered.

While the decisions in Chin³⁰ and Reid,³¹ both issued by this Commission, ordered production of elements of the tort file in an accident benefits proceeding, they did so based on different facts and for different reasons.

As noted in Chin, the tort and accident parties were the same. Arbitrator Allen allowed the use of the discovery transcript to test the Applicant's credibility. However, in doing so, she made findings regarding the commonality of issues and the Applicant's waiver of his right to privacy, which are not applicable in the instant case. The matter did not involve access by a third party as is the case here.³²

In Reid, the insurer did not have any other access to medical examinations regarding the medical issues in dispute. Arbitrator Blackman found that without the reports, the insurer would be significantly prejudiced in responding to the application for arbitration. Consequently, Arbitrator Blackman found that the interests of justice outweighed the prejudice to the applicant and ruled that the implied undertaking did not apply to defence medicals from the tort file.

That is also not the case here. J.V. has already submitted to an examination by Dr. Lacerte, a specialist in physical medicine and rehabilitation.

Furthermore, she has agreed to attend an insurer's orthopaedic examination. As the two defence medicals sought were both conducted by specialists in orthopaedic medicine, I see no prejudice to State Farm. To their credit, they allege none. However, on these facts it is difficult to find that the interests of justice require that State Farm also be given access to the defence medicals. To the contrary, I find that such access would give rise to the concerns raised by Hockin J. in Reimer,³³ and Browne J. in Tanner,³⁴ in that it would create an imbalance and allow the insurer to in effect "double up" on its medicals, reducing the matter, in some respects, to a battle of numbers. While I agree with State Farm that the absence of the defence medicals from accident benefits arbitration may increase the risk of inconsistent results, this is always the case when there are two different triers of fact. That is the route chosen in this instance. While a valid concern, I do not find it sufficient to alter the balance regarding the interests of justice. Nor does the fact the defence medicals are relevant. As indicated in London Life Insurance Co.³⁵ and Reimer,³⁶ this is an acknowledged aspect of the implied undertaking rule, in that the sought materials would, in most instances, be relevant. In London Life, the court stated at paragraph 7 as follows:

It was submitted that if we allow the appeal we will be countenancing the concealment of relevant evidence. That may be so, but the principle is established that the privacy interests of litigants are to be protected and it is inherent in that principle that sometimes relevant evidence will not be available... It is not unfair to London Life to leave it to the rights it contracted for in respect of re-assessing a claimant's right to payments.

Finally, I do not find the fact that historically parties readily exchanged documents from the tort and accident benefits file alters the application of the implied undertaking rule once it is relied upon.

I also have no hesitation refusing to grant relief from the implied undertaking rule with regard to J.V.'s discovery transcript.

This is an arbitration process, intended to facilitate the expeditious resolution of disputes. Oral discovery is not a process available to the parties in proceedings before the Commission. To allow State Farm access to the transcript without extremely compelling facts to show that it would foster the interests of justice would undermine the goal of expediency, as well as allow State Farm to do indirectly what the legislature has chosen not to allow it to do directly. For the reasons set out above, I find that State Farm is not entitled to the production of the discovery transcript or the defence medical examination reports from the tort action.

II. Insurer's Entitlement to require J.V. to attend a Psychiatric Examination:

Agreed Statement of Facts:

With regard to the Insurer's entitlement to a psychiatric examination, the parties filed the following agreed statement of facts:

9. On September 2, 1993, [J.V.] attends at the Crisis and Short-term Intervention Unit of the St. Thomas Psychiatric Hospital. The Outpatient Initial Summary indicates that [J.V.] was referred by her family physician Dr. Vaughan "due to stress reactive to a recent automobile accident” The Summary contains the following information about [J.V.] mental status:

(a) No psychopathology was noted re: orientation, memory, thought process or thought content. No history of major affective disorder. Denies suicidal ideation.

(b) Main Problem: anxious state of two weeks.

(c) Symptoms (or main features): sleep disturbances in the form of frequent nightmares and restlessness throughout the night. States she is eating more than usual. Constant ruminations of accident throughout the day.

10. The September 2, 1993 Summary confirms [J.V.]'s assertion that she has never had previous counselling. The provisional diagnosis is post-traumatic stress disorder. The Initial Treatment Plan is outlined as follows:

(i) Brief Supportive Counselling, mainly non-directive, with emphasis on the exploration of feelings.

(ii) Dr. Mendonca was consulted and advised re: treatment plan and diagnosis.

(iii) The main components of this patient's anxious state appears directly related to the M.V.A.

(iv) Treatment will therefore consist of: goal planning where information was relayed regarding the 4-6 week time span for psychological adjustment following a sudden event. Anxiety management therapy.

The Outpatient Initial Summary was signed by Dr. J. D. Mendonca, psychologist, and J. Previl, RN.

3. Dr. Mendonca and Ms. Previl prepare an Outpatient Termination Note dated September 29, 1993. It is noted that at the time of [J.V.]'s September 15, 1993 appointment, she was complaining of waking three times or more during the night, screaming and perspiring. She would ruminate about the accident and spend a very restless night. Dr. Mendonca suggested Imipramine for the night terrors. Dr. Vaughan was consulted. At [J.V.]'s termination visit of September 29, 1993, she reported to be sleeping very well and was thankful for the medication.

4. Dr. Vaughan, the treating family doctor, noted in his records the following:

• August 24, 1993 - [J.V.] was nervous and anxious. The assessment was anxiety and depression.

• September 1, 1993 - She was in for followup for the anxiety. The assessment was post-traumatic stress.

5. Pre-accident Dr. Vaughan had noted in his records, on August 5, 1993, a finding of anxiety which appears to have been due to [J.V].'s weight.

6. Dr. Jezdic, the subsequent family physician, noted in her initial consultation (post-accident) that the Applicant had stress.

• In her note dated November 14, 1995, [J.V.] was said to be very anxious with respect to the car accident.

• On January 21, 1997, she had a stress-related headache and she was said to be depressed.

• In her medical or psychological report dated September 1, 1999, Dr. Jezdic says that [J.V.] had depression and anxiety, in addition to chronic pain, and the diagnosis was chronic musculoskeletal pain with depression and anxiety.

7. Following the physiatric insurer's examination in March of 1998, Dr. Lacerte provides a report dated June 11, 1998. On page 11 of the report, [J.V.] is noted as having reported "being in a depressed mood. She described a markedly diminished interest/pleasure in all activities since the August 18, 1993 M.V.A. She reported insomnia, fatigue and loss of energy. She stated she feels worthless and has the inability to think or concentrate."

8. At page 12 of his report Dr. Lacerte pointed out that J.V. denied headaches, neck pain, back pain or depression prior to the accident, but also points out that as indicated earlier, this is in direct contrast with the documentation provided.

9. On page 19 of his report, Dr. Lacerte states: "I would recommend that the medical relationship (causation) of [J.V.] [sic] current psychological complaints and August 18, 1993 M.V.A. be determined by a psychiatrist familiar with Post-Traumatic Stress Disorder, Malingering and Somatization”

10. [J.V.] has never been treated or assessed by a psychiatrist.

Argument:

State Farm:

State Farm made extensive argument regarding its entitlement to an insurer's medical examination of J.V. This was not contested, and, in fact, J.V. indicated she was agreeable to attending an examination with a psychologist of State Farm's choice.

Consequently, I will focus on the issue of whether the examination should be by a psychologist or a psychiatrist.

State Farm argued that because the issue in dispute is not just whether J.V. sustained a physical injury, but includes whether she sustained a psychological or mental injury, the Insurer is entitled to the proposed psychiatric assessment pursuant to section 23(2) of the Schedule, set out below.

State Farm further argued that the choice of specialist is that of State Farm, provided that a reasonable nexus exists between the choice of specialist and the injuries claimed.³⁷

State Farm maintained that in this instance the request for a psychiatric examination is reasonable because J.V.'s medical records demonstrate psychiatric illnesses such as anxiety and depression which may have been caused by the motor vehicle accident. Furthermore, Dr. Lacerte, who examined J.V., recommended she be seen by a psychiatrist familiar with Post-Traumatic Stress Disorder.

State Farm further maintained that the hearing arbitrator may be required to determine if J.V. has a psychiatric disorder which entitles her to weekly benefits, or which may influence any physical disability resulting from the accident. It argued that, without the psychiatric examination, State Farm's ability to make a full answer and defence is hampered.

J.V.:

J.V. pointed out that although she received a brief course of treatment from Dr. Mendonca, a psychologist, in September of 1993, she has never been treated by a psychiatrist. She argued that as she is prepared to attend an examination with a psychologist of the Insurer's choice, her refusal to attend a psychiatric examination does not prejudice State Farm in any way.

J.V. further argued that if she is required to attend a psychiatric examination, she will be forced to retain a psychiatrist of her own in order to respond to the Insurer's expert, and that this would serve only to escalate the proceedings.³⁸

Relevant Legislative Provision:

The applicable sections of the Schedule are the following:

An insurer's right to require an applicant to attend an Insurer Medical Examination ("IME") is set out in subsections 23(2) and 25 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...

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

Analysis:

Every applicant bears the onus of establishing that he or she is entitled to benefits and meets the legislated tests of degree of disability, and that the disability results from an accident.

An insurer's right to request an examination is a legislated one. This makes such examinations inherently intrusive and an invasion of an individual's right to privacy. Consequently, when assessing the reasonableness of such a request, consideration must be given to balancing those conflicting rights.

As held by Arbitrator Naylor in Scott and Toronto Transit Commission (Markel Insurance), "neither the wording nor the intent of the provision support a narrow or unduly restrictive right of examination."³⁹

Nor, however, is the right unqualified, as is indicated by the requirement that the examination be only "as often as [the insurer] reasonably requires." [emphasis added]

The determination of whether it is reasonable for State Farm to require J.V. to attend for a psychiatric examination will require a balancing of her right to privacy and the right of the Insurer to require an examination.

The issue becomes then, whether, in the circumstances of this case, a psychiatric examination is reasonably necessary to independently and effectively assess J.V.'s claim for benefits.

J.V. has been experiencing the difficulties which gave rise to this issue since her accident in 1993. While she has received treatment for these difficulties from time to time, a psychiatric referral has not been made to date. While Dr. Lacerte recommended that she be assessed by a psychiatrist in 1998, this was not pursued by the Insurer. Nor is it apparent why a psychologist would not be sufficient to perform the type of assessment Dr. Lacerte suggests. Without some clear indication in that regard, I do not find the mere fact the recommendation was made to be compelling.

The arbitration is set to begin on February 18, 2002. To allow an initial psychiatric assessment at this late stage would also carry with it some risk of delay as J.V. may feel she requires additional time to seek her own psychiatric assessment.

I also agree with J.V. that to allow a psychiatric examination would be unnecessarily intrusive and would "escalate" the medical aspects of the proceedings.

Consequently, for the reasons set out above, I find it is not reasonable for State Farm to require J.V. to attend a psychiatric examination.

EXPENSES:

I leave the matter of expenses to the hearing arbitrator.

November 27, 2001

Tanja Wacyk Arbitrator

Date

Neutral Citation: 2001 ONFSCDRS 173

FSCO A00-001002

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

J. V.

Applicant

and

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY

Insurer

ARBITRATION ORDER

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

1. J.V. is not required to produce her discovery transcript in the Third Party (tort) action;

2. J.V. is not required to produce the defence medical examination reports from the Applicant's tort action.

3. It is not reasonable for State Farm to require J.V. to attend an insurer's psychiatric examination.

4. I leave the matter of expenses to the hearing arbitrator.

November 27, 2001

Tanja Wacyk Arbitrator

Date

Footnotes

1. 1The Statutory Accident Benefits Schedule — Accidents On or Between June 22, 1990 and December 31, 1993, Regulation 672 of R.R.O. 1990, as amended by Ontario Regulations 660/93 and 779/93.
2. 2Tanner v. Clark, May 8, 2001, (unreported) (Ont.Sup.Ct.) at page 4
3. 3(1995), 1995 CanLII 1888 (ON CA), 24 O.R. (3d) 359
4. 4Ibid
5. 5Ibid, and LiventInc. v. Drabinsky et. al. (2001) 53, O.R. (Ed) 126 p. 130-131 (Lederman J.)
6. 6Cook v. Ip et al (1985), 1985 CanLII 163 (ON CA), 52 O.R. (2d) 289 (C. A.)
7. 7(1994) O.J. No. 2535
8. 8Production was also ordered in similar circumstances in the case of Soodhar v. Bagley. (1999) 1999 ABQB 89, 243 A.R. 257 (Alta. Master). However, it does not appear the implied undertaking rule was raised in that instance.
9. 91998 CanLII 18849 (ON CTGD), 41 O.R. (3d) 706 (Ont. Div.Ct. )
10. 10(1999) N.S.J., No. 498 (N.S. Sup. Ct)
11. 11(2000), 2000 CanLII 26982 (ON SC), 50 O.R. (3d) 275 (Sup.Ct.)
12. 12In Brown the reference was to a Section B benefits claim file.
13. 13(FSCO A00-001024, April 18, 2001)
14. 14[2001] O.J. No. 1124 at page 4 (Ont. Sup. Ct. J.)
15. 15Supra
16. 16Supra see note 9
17. 17Supra
18. 18Ibid
19. 19Tanner v. Clark, supra, see note 2
20. 20Reimer v. Christmas, July 11, 2001 (unreported) (Ont.Sup.Ct.) (this appears to be the case with Tanner as well)
21. 21(FSCO A99-000959, January 19, 2000)
22. 22Supra, see note 9
23. 23(2000), O.J. No. 1777 (Ont. Sup. Ct.) at page 7
24. 24Ibid at page 7
25. 25Chin, see note 13 at page 7
26. 26Rules of Civil Procedure
27. 27Goodman v. Rossi see note 3 at paragraph 29
28. 28Supra, see note 5 at page 29
29. 29Lederman J. held that while the rule makes no reference to non-parties seeking relief, such an opportunity did exist at common law.
30. 30Chin, supra see note 13.
31. 31Reid, supra see note 21.
32. 32In Binns, a similar situation existed. The third party was both the defendant's liability insurer and the plaintiff's accident benefits insurer, and was added as a third party in the plaintiff's tort action as a result of a coverage dispute with the defendant. In that instance, Justice MacDonald found that the insurer in the tort action was entitled to make use of the opinion of its accident benefits medical examiners in order for the statutory scheme to operate harmoniously. This raises the question, however, of whether the absence of references to the transportability of medical information from one process to the other is reflective of legislative intent.
33. 33Reimer supra see note 20.
34. 34Tanner supra see note 19.
35. 35London Life supra see note 9.
36. 36Reimer, supra.
37. 37Scott and Toronto Transit Commission (Markel Insurance) (OIC A-00116, September 4, 1992)
38. 38Panotta v. Brown, May 25, 2001 (unreported ) (Ont. Sup. Ct.)
39. 39Scott, see note 37 at page 12