Pat Pantelidis v. Certas Direct Insurance Company, 2002 ONFSCDRS 19

Pre-Hearing Decision

Neutral Citation: 2002 ONFSCDRS 19

FSCO A01-001126

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

PAT PANTELIDIS

Applicant

and

CERTAS DIRECT INSURANCE COMPANY

Insurer

PRE-HEARING DECISION

Before: Lawrence Blackman

Heard: December 6, 2001, at the offices of the Financial Services Commission of Ontario in Toronto.

Appearances: Tony Lafazanis for Mrs. Pantelidis Rita Urbonvicius for Certas Direct Insurance Company

Issues:

The Applicant, Pat Pantelidis, was injured in a motor vehicle accident on May 1, 1998. She applied for and received statutory accident benefits from Certas Direct Insurance Company ("Certas"), payable under the Schedule.¹ Certas refused payment of certain benefits. The parties were unable to resolve their disputes through mediation, and Mrs. Pantelidis applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

At the pre-hearing discussion of this case held on December 6, 2001. The issues in dispute were identified and agreed to as follows:

1. Is Mrs. Pantelidis entitled, pursuant to section 4 of the Schedule, to receive a weekly income replacement benefit ongoing from May 8, 1998?

2. What is the amount of the weekly income replacement benefit that Mrs. Pantelidis is entitled to receive pursuant to section 6 of the Schedule?

3. Is Mrs. Pantelidis entitled, pursuant to section 22 of the Schedule, to weekly payments of $100 for housekeeping and home maintenance services, ongoing from July 25, 1998?

4. Is Certas liable to pay a special award pursuant to subsection 282(10) of the Insurance Act because it unreasonably withheld or delayed payments to Mrs. Pantelidis?

5. Is Certas liable to pay Mrs. Pantelidis' expenses in respect of the arbitration under subsection 282(11) of the Insurance Act?

6. Is Mrs. Pantelidis liable to pay Certas' expenses in respect of the arbitration under subsection 282(11) of the Insurance Act?

7. Is Mrs. Pantelidis entitled to interest on any overdue payment of benefits, pursuant to subsection 46(2) of the Schedule?

Certain production issues could not be resolved and I provided orders with oral reasons on December 6, 2001. My further written reasons are as follows:

1. The Insurer sought production of any medical reports or records that it does not have, specifically any reports arising out of the Applicant's court action pertaining to a prior March 7, 1997 slip and fall accident. The Insurer noted that certain defence medical reports from this action had already been produced by the Applicant. The Applicant objected to this production request, relying on the deemed undertaking rule, codified as Rule 30.01 of the Rules of Civil Procedure. The Insurer submits that the Applicant has waived her rights under this Rule. The Applicant maintains that it produced the defence medical reports on a "without prejudice" basis.

ORDER:

The Applicant shall decide, within forty-five (45) days of this pre-hearing discussion whether she intends to rely on any defence medical report arising out of the March 7, 1997 accident (by filing the report and/or calling the author thereof). If she does intend to rely on any defence medical report, she shall produce all defence medical reports originating in that action. In the interim, pending a decision by the Applicant whether to rely on any defence medical report, and pending any order by an arbitrator to the contrary, the Insurer's pre-hearing memorandum and the Applicant's letter (with enclosures) of December 6, 2001 (which contain or refer to these reports) will be sealed.

Defence medical examinations are provided for under Rule 33 of the Rules of Civil Procedure. Rule 33 is one of the provisions to which the deemed undertaking rule pertains. The latter provides that all parties and their counsel are deemed to undertake not to use evidence or information to which this Rule applies for any purposes other than those of the proceeding in which the evidence was obtained.

Rule 30.1.01(4) provides that the Rule does not prohibit a use to which the person who disclosed the evidence consents. Given the following in the June 11, 2001 letter from the Applicant's counsel to the Insurer, I am not satisfied that there was any waiver of the Applicant's rights under Rule 30.1:

I provided you with my complete medical brief. Technically, I was permitted to not disclose some of the reports as a result of the deemed undertaking rule. This was recently affirmed in the case called Reimer vs Christmas (copy enclosed).

I am providing the reports on a without prejudice basis, and specifically for the purpose of putting you in a position where we can have, hopefully, productive settlement discussions.

Rule 30.1.01(8) of the Rules of Civil Procedure provides the court with the power to order that the deemed undertaking rule does not apply, if the court is satisfied that the interests of justice outweigh any prejudice that would result to a party who disclosed evidence.

While acknowledging the contrary position in Hornick and State Farm Automobile Mutual Insurance Co. (FSCO A00-000337, November 30, 2000),² I agree with the reasoning in Reid and Royal & SunAlliance Insurance Co. of Canada (FSCO A99-000959, January 19, 2000), Chin and Coseco Insurance Co. (FSCO A00-001024, April 18, 2001), and in Sandhu and CAA Insurance Company (Ontario) (FSCO A99-001031, October 3, 2001)³ that arbitrators do have discretion to grant relief from the deemed undertaking rule. Indeed, in the recent decision of J. V. and State Farm Mutual Automobile Insurance Company (FSCO A00-001002, November 27, 2001), it was not disputed that FSCO has the discretion to grant relief from the deemed undertaking rule.

I agree with the comments in J. V. that an interpretation of the implied undertaking rule which could result in "routine infringement" of the rule in cases involving accident benefit claims and parallel tort actions is not appropriate.

As I was provided with no argument that the interests of justice outweigh any prejudice to the Applicant, I decline to exercise my discretion to order production of the defence medical reports arising from the slip and fall action.

However, the Applicant left open the possibility that she may rely on defence medical opinions arising from this action. The interests of justice cannot allow the Applicant to "cherry pick" from the defence medical reports those which she feels will advance her case. Such interests of justice outweigh any prejudice to the Applicant. Considering that the parties chose to have the arbitration hearing heard in July 2002, I find it appropriate to allow the Applicant forty-five days from the date of this pre-hearing discussion to choose whether she will be relying on any of these defence medical reports and, if so, to produce to the Insurer within a similar time frame all such reports.

2. The Applicant sought production of the Insurer's complete accident benefits file pertaining to herself. Certas undertook to produce a copy of its accident benefits file up to August 29, 2000, the date I am advised the Application for Mediation herein was served and filed. Certas claimed privilege over the remainder of its accident benefits file. The Applicant submitted that the Insurer had a general duty of continuing disclosure. She stated that Certas should be required to list, by affidavit of documents, those documents for which it claimed privilege and the particulars of same.

ORDER:

The Applicant's production request is denied.

Campeau and Liberty Mutual Insurance Company (FSCO A00-000522, March 12, 2001) provided reasons as to why FSCO's pre-hearing arbitration procedure called for a systemic broad-stroke approach to the question of production from the Insurer's accident benefit file and, further, as to why routine affidavits of documents were inappropriate to this system. In accordance with the evolving arbitral case law, I held that the prima facie dividing line for production from an insurer's file should be the date of Application for Mediation, "subject to submissions by either side as to why the production period or scope in a particular case should be broadened or narrowed."

I am still persuaded that this general approach is most consistent with the pre-eminent interpretative guideline, set out in Rule 1.1 of the Code, that "these Rules will be broadly interpreted to produce the most just, quickest and least expensive resolution of the dispute."

In this case, Certas implicitly agreed with the aforesaid general dividing line. The Applicant provided no argument, evidence or basis, on the facts particular to this case, upon which to broaden the period or scope of production. Accordingly, I see no reason to go beyond the Insurer's undertaking.

A standard part of the FSCO pre-hearing letter is that "[s]hould there be any issues arising out of the documents forthcoming that cannot be resolved by the parties this pre-hearing discussion may be resumed by telephone conference before me." I have previously noted in the pre-hearing letter that in this case, the "documents forthcoming" include not merely clinical notes and records and the OHIP summary, but "also that part of the Insurer's accident benefits file undertaken to be produced."

3. The Applicant sought production of claims manuals "typically" used by Certas' adjusters in cases such as this. The Insurer objected to this production request. Its submission, in essence, as I understand it, is that there was a straight forward reason why income replacement benefits have not been paid to the Applicant, namely, that the Insurer has not received the necessary information and records to determine what benefit may be owing. The Insurer further submitted that any such claims manuals are not relevant to this proceeding.

ORDER:

The Applicant's production request is denied.

In Campeau I stated, in part, that:

I find that for general policy manuals to be ordered produced, the specific relevance to the particular claim and/or the reasonable necessity of the document should be established. The routine production of all possibly applicable policy manuals whenever a special award is sought, is simply too cumbersome and expensive. In this case, I am not satisfied that the broad request made is reasonably necessary or relevant. I decline to make the order sought.

Mrs. Pantelidis failed to establish the relevance and/or reasonable necessity of any specific manual or similar document.

4. The Applicant requested a list of the medical examiners Certas uses for insurer examinations conducted pursuant to section 42 of the Schedule. The Applicant submitted that this was pertinent to whether the file was reasonably handled and was a fair line of inquiry in cross-examination. The Insurer argued that such a list was not relevant. It stated that the Applicant could have requested an examination by a designated assessment centre.

ORDER:

The Applicant's production request is denied.

I fail to see the relevance of the request. Subsection 282(10) of the Insurance Act, R.S.O. 1990, c.I.8, allows a special award where there is a finding that "an insurer has unreasonably withheld or delayed payments." This necessitates a particularized inquiry into the reasons why a specific benefit was not paid or why payment was delayed. I do not see how a broader inquiry as to whom generally an insurer may call upon to do insurer medical assessments is, prima facie, relevant for production purposes.

Further, as set out below in issue #6 below, pre-hearing discussions usually deal with the exchange of existing documentation, not the creation of new documentation, specifically in response to questions, if relevant at all, better left to cross-examination at the arbitration hearing itself.

There is a distinction between an applicant having access to one's own file, and an applicant having access to an insurer's general operating procedures and information.

While there are substantive differences between a special award and punitive damages, I do note the comments of Matlow J. in Friese v. Citadel Life Assurance Co. [2000] O.J. No. 2365, that having production based solely on the wording of the plaintiff's pleadings (which in that case included a claim for insurance benefits and claims for punitive, exemplary and aggravated damages) encouraged "abuse and unwarranted interference in private matters that should deserve some protection." Privacy concerns are a legitimate consideration in dealing with production requests. I find that similar concerns have, for example, guided the generally applied one-year pre-accident production restriction pertaining to discovery of the clinical notes and records of an applicant's treating medical practitioners (see Practice Note 4 of the Code - Exchange of Documents), subject to an evidential basis being established for earlier or broader disclosure.

In the same vein, I also note the comments of Case Management Master McCleod, in Santos v. Santek Investments Inc. [1999] O.J. No. 548, that "punitive damages [are] an extraordinary discretionary remedy [which] should not be used as a boilerplate excuse for invasive discovery which is not truly relevant to the factual dispute in issue."

I deal further with the question of medical examiners below, under item #6.

5. The Applicant sought specific production of any claims manuals of the Insurer pertaining to the choice of medical practitioner for an insurer's medical examination and when the insurer should conduct same.

ORDER:

The Applicant's production request is denied, for the reasons set out above.

6. The Applicant requested that the Insurer advise as to the frequency that it retained Dr. Bushuk to do insurer medical examinations in the year before and after his report. The Insurer objected to this request, submitting that it could not see the relevance of the request and that it amounted to a "fishing expedition."

ORDER:

The Applicant's production request is denied.

The functions of a pre-hearing discussion are set out at Rule 33 of the Code. These functions include the identification and exchange of documents. This has usually been taken by arbitrators to mean the exchange of documents which already exist or documents brought into existence in the normal course of business or upon which a party intends to rely. Arbitration is intended to be a quicker and less expensive alternative of dispute resolution. Pre-hearing discussions are not meant to be an arbitral equivalent to either oral examinations for discovery or examination for discovery by written questions afforded by the Rules of Civil Procedure.

Rule 32.3 provides that an arbitrator may at any time order the disclosure of information he or she considers relevant to the determination of the issues in the arbitration, on such terms as he or she considers appropriate. Rule 33.1(h) allows an arbitrator to deal with any other matters that he or she considers appropriate, within the guidelines of attempting to resolve the dispute or assist the parties to prepare for the arbitration. This production request appears to be a "fishing expedition" with the goal, apparently, of trying to establish some basis for an argument that a medical practitioner may not be truly independent. I am not persuaded that this specific production request is 1) sufficiently relevant; 2) assists in resolving the dispute; or, 3) assists the parties to properly prepare for the arbitration hearing.

Arbitrators, as adjudicators with a level of specific expertise and knowledge, are generally interested in the individual merit or lack of merit of the expert opinion specific to the proceeding before them. This includes, but is not limited to the following areas of inquiry:

• What is the level of expertise and degree of experience of the expert?
• Was the expert alive to the appropriate issue or issues?
• Was the expert alive to the appropriate statutory tests and the case law interpretation thereof?
• Was the expert fully cognizant of the relevant pre and post-accident history, including the pertinent reports, records and notes of other medical practitioners and professionals?
• Were the appropriate tests and/or examinations performed?
• Who conducted those tests and examinations (and with what level of expertise), how, and under what conditions?
• How familiar was the expert with the insured?
• How many times and for what periods of time did the expert interview and examine the insured?
• How thorough and accurate were the notes that were taken?
• Was the expert forthright regarding any weaknesses in the report?
• Did the expert offer alternate explanations or theories?
• If the expert's opinion differs from that of others, does the expert set out a persuasive basis for the difference of opinion?
• Did the expert support his or her opinion, and if so, to what degree and on what basis?
• Was the report internally inconsistent or contradictory?
• Did the expert, in the specific report or oral evidence itself, put on the mantle of an advocate rather than the cloak of an impartial neutral expressing an independent opinion?

Regarding this specific production request, at this juncture, I am not persuaded that production of possible evidence that an expert may work mainly for one side, that an expert may work mainly for one client, or, indeed, that an expert may earn significant income from the client involved in the proceeding in question, is sufficiently relevant to the above questions, in the context of this expert tribunal, to justify the invasive and time consuming order sought. Even should it be found that an expert is not totally at arm's length from a party, it does not necessarily follow that the opinion expressed is not valid.

I wish, however, to state what should be obvious, that my orders and reasons herein pertain solely to these production requests and cannot be binding on any hearing arbitrator regarding the scope of evidence that may be allowed at the arbitration hearing.

7. The Applicant requested that the Insurer advise, for the year before and after Dr. Bushuk's assessment, the number of times that Dr. Bushuk supported a denial of benefits. The Insurer submitted that this request was beyond the scope of this case and, again, constituted a "fishing expedition."

ORDER:

The Applicant's production request is denied, for the reasons set out in #6 above.

8. The Applicant requested that the Insurer produce an affidavit of documents for any documents for which it claimed privilege. The Insurer submitted that an affidavit of documents was not applicable for this forum.

ORDER:

The Applicant's production request is denied, for the reasons set out in #2 above.

EXPENSES:

The expenses of this pre-hearing discussion are left to the hearing arbitrator.

January 25, 2002

Lawrence Blackman Arbitrator

Date

Neutral Citation: 2002 ONFSCDRS 19

FSCO A01-001126

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

PAT PANTELIDIS

Applicant

and

CERTAS DIRECT 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. The Applicant shall decide, within forty-five (45) days of this pre-hearing discussion whether she intends to rely on any defence medical report arising out of the March 7, 1997 accident (by filing the report and/or calling the author thereof). If she does intend to rely on any defence medical report, she shall produce all defence medical reports originating in that action. In the interim, pending a decision by the Applicant whether to rely on any defence medical, and pending any order by an arbitrator to the contrary, the Insurer's pre-hearing memorandum and the Applicant's letter (with enclosures) of December 6, 2001 (which contain or refer to these reports) will be sealed.

January 25, 2002

Lawrence Blackman Arbitrator

Date

Footnotes

1. 1The 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.
2. 2I acknowledge that this decision was followed, subsequent to my oral decision, in Gocan and State Farm Mutual Automobile Insurance Company (FSCO A01-000799, December 31, 2001).
3. 3This decision was upheld on appeal (FSCO P01-00044, January 18, 2002) subsequent to my oral decision, but, in part, on different grounds. The Director's Delegate held that the issue was one involving "the exercise of discretion to order production, which is within the arbitrator's power, rather than a request to grant relief from the [implied] undertaking." He further stated that "there is a presumption that the privacy of litigants will be protected unless the party seeking disclosure can demonstrate that, in those particular circumstances, their legislated rights to information in proceedings before the Commission are not sufficient, and the interests of justice outweigh any prejudice to the party who disclosed the evidence."