Neutral Citation: 2003 ONFSCDRS 123

FSCO A01-001620

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

MARILYN HENDERSON-BRIEHL

Applicant

and

ING INSURANCE COMPANY OF CANADA

Insurer

REASONS FOR DECISION

Before:

William J. Renahan

Heard:

June 17 and 18, 2003, at the offices of the Financial Services Commission of Ontario in Toronto.

Written submissions were received by June 27, 2003.

Appearances:

Megan Parry, Barrister and Solicitor for Ms. Henderson-Briehl

Boyd Critoph, Barrister and Solicitor for ING Insurance Company of Canada

Issues:

The Applicant, Marilyn Henderson-Briehl, was injured in a motor vehicle accident on March 10, 2000. She applied for statutory accident benefits from ING Insurance Company of Canada ("ING"), payable under the Schedule.¹ ING refused to pay weekly income replacement benefits because Mrs. Henderson-Briehl refused to attend a medical examination ING arranged pursuant to section 42 of the Schedule. The parties were unable to resolve their disputes through mediation, and Mrs. Henderson-Briehl applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The issues in this hearing are:

1. Is Mrs. Henderson-Briehl barred from proceeding with this arbitration pursuant to section 50(b) of the Schedule because she did not make herself available for an examination required by ING under section 42 of the Schedule?

2. Are losses from self-employment incurred by Mrs. Henderson-Briehl before the accident set off against her income from employment before the accident to determine the amount of any income replacement benefit?

3. What is the gross income used to determine the deduction under section 6(2) of the Schedule for post accident income earned by Mrs. Henderson-Briehl?

4. Is Mrs. Henderson-Briehl entitled to a special award pursuant to section 282(10) of the Insurance Act?

5. Is either party entitled to expenses of the arbitration proceeding pursuant to section 282(11) of the Insurance Act?

Result:

1. Mrs. Henderson-Briehl is not precluded from proceeding with this arbitration because she failed to attend a medical examination under section 42 of the Schedule.

2. Losses from self-employment are not set off against employment income in the determination of the amount of any income replacement benefit.

3. For the period October 5, 2000 to December 31, 2000, ING is entitled to deduct from any income replacement benefit, 80 per cent of net income based on gross income of $28.88 per week. For the period January 1, 2001 to February 1, 2001, ING is entitled to deduct from any income replacement benefit, 80 per cent of net income based on gross income of $16.71 per week.

EVIDENCE AND ANALYSIS:

Background:

Despite significant medical conditions, Mrs. Henderson-Briehl worked at two jobs before the accident. She worked 32.5 hours a week as an assistant teacher helping ten physically and mentally disabled children. Mrs. Henderson-Briehl also worked as a self-employed real estate sales person. She worked evenings and weekends approximately 40 hours a week at this job.

On March 10, 2000, Mrs. Henderson-Briehl was stopped at a red light when her vehicle was struck from behind. Among other things, Mrs. Henderson-Briehl suffered a whiplash injury which aggravated the degenerative arthritis in her spine.

She advised ING of the accident and ING sent her an accident benefits package. Although she did not miss any time from work, Mrs. Henderson-Briehl submitted an application for accident benefits dated March 20, 2000. In answer to the question, "Do your injuries prevent you from working?" Mrs. Henderson-Briehl answered "partially - prevents me from lifting and assisting with disabled students." Her family doctor signed a Disability Certificate and ticked off the box to indicate that his patient could return to work.

ING reviewed the application and advised Mrs. Henderson-Briehl that she did not qualify for income replacement benefits because she had not missed time from work. The adjuster invited Mrs. Henderson-Briehl to submit a treatment plan if she wanted treatment. Mrs. Henderson-Briehl applied for chiropractic treatment and the adjuster approved chiropractic services in the amount of $3,625.

ING asked Mrs. Henderson-Briehl to attend examinations, purportedly pursuant to section 42 of the Schedule, with Dr. Joel Nathanson, a chiropractor, Dr. Geoffrey French, an orthopaedic surgeon, and Dr. Daniel Selchen, a neurologist.

For reasons I will discuss later, Mrs. Henderson-Briehl was not happy with the examinations with Dr. Nathanson and Dr. French. Among other things, she claimed that when Dr. French examined her on October 3, 2000, he made her condition worse. The next day, Mrs. Henderson-Briehl went to the emergency department of a hospital for treatment. She also sought legal advice. Her lawyer advised ING that Mrs. Henderson-Briehl would not attend the examination with Dr. Selchen because Mrs. Henderson-Briehl had not claimed a benefit which would justify an examination under section 42 of the Schedule.

Mrs. Henderson-Briehl has not returned to teaching since October 4, 2000. ING first learned that Mrs. Henderson-Briehl had not returned to teaching when it received an application for income replacement benefits from Mrs. Henderson-Briehl's lawyer on April 5, 2001.

Effective February 1, 2001 Mrs. Henderson-Briehl received long-term disability benefits which reduced any income replacement benefit to zero. Accordingly, the income replacement benefits in issue are for the period October 4, 2000 to February 1, 2001, a period of approximately four months. ING conceded that Mrs. Henderson-Briehl met the disability test for that period and that her disability was caused by the motor vehicle accident.

The first question is whether Mrs. Henderson-Briehl is precluded from commencing an arbitration for those benefits because she failed to attend the medical examination ING arranged with Dr. Selchen for October 13, 2000.

Law:

The procedures for claiming accident benefits are set out in Part X of the Schedule.

Section 32 obliges the person who wants to apply for a benefit to promptly notify the insurer of the accident, and, once notified, the insurer is required to promptly provide the insured with application forms, explanations and information to assist the insured. The insured is then obliged to submit the application for the benefit within 30 days, or as soon as practicable thereafter.

Section 50(a) provides that a person cannot commence a mediation proceeding if he or she has not complied with this section.²

Section 42 sets out the insurer's rights to require the insured to attend a medical examination. I agree with the statement in Scott and TTC (Markel Insurance)³ that "The exercise of the right to a medical examination under the No-Fault Benefits Schedule is inherently intrusive and an invasion of individual privacy." Because it is inherently intrusive and an invasion of individual privacy, section 42 defines and limits the scope of an examination an insured is required to submit to.

I emphasize those parts of subsections 42(1), (2) and (5) which set out the scope of the examination which the insurer may require.

42. (1) For the purpose of determining whether an insured person is entitled to a benefit, except a funeral or death benefit, an insurer may give the insured person notice requiring him or her to be examined by one or more persons specified by the insurer, each of whom is a member of a health profession or a person with expertise in vocational rehabilitation.

(2) The notice shall state the benefit to which the examination relates.

(5) For the purpose of the examination,

(a) the insured person shall provide the person or persons who conduct the examination with such information as is reasonably necessary; and

(b) the insured person shall submit to any reasonable physical, psychological, mental and functional examinations requested by the person or persons who conduct the examination.

In Avdalimov and CGU Insurance Company of Canada,⁴ Arbitrator Palmer stated that one of the reasons the notice must specify the benefit to which the examination relates is "because it allows an insured person who is reluctant to attend an examination to evaluate whether he wishes to continue to pursue an insurer for a specific benefit, or instead decline to attend an examination and thereby effectively choose to forego the insurer's payment of that benefit, either permanently or for a period of time."

However, in my view, the overriding purpose of sections 32 and 42 is to balance an insured's right to individual privacy with an insurer's right to obtain an independent medical opinion on the merits of an insured's claim for an identified benefit under the Schedule.

Section 32 requires the insured to promptly notify the insurer of his "application for the benefit." Section 42(1) allows the insurer to require an examination "for the purpose of determining whether an insured person is entitled to a benefit." Subsection 42(2) provides that the notice shall state "the benefit to which the examination relates." And, subsection 42(5) requires the insured to submit to "any reasonable" physical, psychological, mental and functional examinations, and provide the examiner with such information as is "reasonably" necessary.

In my view, the purpose of these provisions is to focus the insured, the insurer and the examining health care professional on the purpose of the examination and to limit that examination to information that the health care professional needs to form opinions on issues relevant to the insured's entitlement to the benefit he claims.

In September 2000, ING sent Mrs. Henderson-Briehl a "Notice of Insurer Examination" with Dr. Selchen scheduled for October 13, 2000. The notice quoted section 42(5) of the Schedule as "the insured person shall submit to any reasonable physical, psychological, mental and functional examinations requested by the person or person [sic] who conduct the examination." The notice stated that "The benefit that this examination relates to is Part V Medical, Rehabilitation and Attendant Care Benefits section 14 and Part II Income Replacement Benefit section 4." At this time, Mrs. Henderson-Briehl was working at both her jobs and was not entitled to income replacement benefits. She had made one claim for chiropractic treatment and ING had paid it. No accident benefits were in issue. In my view, ING had no right to request an examination under section 42 of the Schedule because Mrs. Henderson-Briehl did not have an unresolved claim for a benefit. Accordingly, Mrs. Henderson-Briehl is not barred from proceeding to arbitration for failure to attend the examination scheduled in October 2000 with Dr. Selchen.

Independent medical examinations:

Mrs. Henderson-Briehl advanced a second ground for not attending the examination with Dr. Selchen. She testified that she did not want to attend another examination arranged by ING because she was not happy with the examinations by Dr. Nathanson and Dr. French.

Mrs. Henderson-Briehl testified that she was happy to see Dr. Nathanson because she assumed the Insurer wanted to help her get better. She testified that Dr. Nathanson told her to call him afterwards if she had any questions. Mrs. Henderson-Briehl testified that she was looking forward to the appointment with Dr. French on October 3, 2000, because in the previous two days she had experienced increasing pain going down into her right arm and she thought Dr. French might help her.

With respect to the appointment with Dr. Nathanson at The Assessment Rehabilitation Treatment Centre, ING's adjuster wrote Mrs. Henderson-Briehl that "This is just to give us a comment on the necessity of future therapy and to give us a comment on your current functional status." The Assessment Rehabilitation Treatment Centre wrote a letter to Mrs. Henderson-Briehl to advise her of the appointment which it closed by saying "we look forward as well to helping you plan a safe tomorrow."

In his reporting letter to ING, Dr. Nathanson wrote:

The purpose of the examination was explained to the claimant as being:

1. To address the claimant's concerns regarding her accident.

2. To address the insurance company's concerns regarding the claimant's status and needs.

3. Through independent/functional capacity analysis, to determine the claimant's present safe level of activity.

Dr. French reported to ING:

I explained to Ms. Henderson-Briehl that the purpose of this assessment was to try and determine, from an orthopaedic perspective, whether or not she was physically capable of managing her job as a teacher's assistant with the Peel Board of Education and as a real estate agent with the Royal LePage Company. I explained that you [insurer] were interested in any suggestions that I might make with regard to assisting her achieving maximum medical recovery and that you wanted to know whether or not I would suggest that her medications be changed. I explained to her that in order to accomplish my task, it was necessary for me to take her history, to carry out a detailed musculoskeletal and orthopaedic-neurologic examination and to review not only all relevant documentation but also some x-rays that she brought with her today. . .

The College of Physicians & Surgeons of Ontario has published a policy statement⁵ on Independent Medical Examinations in which it states that:

Many individuals attending IMEs are accustomed to an ongoing relationship with a treating physician and will not have experience with the different expectations inherent in a relationship with an IME. Accordingly, a physician conducting an IME should take extra care to ensure the individual understands the purpose of the examination, how the examination will proceed . . .

The Bulletin distinguishes between services provided by a treating physician and an IME. One main difference is that an IME physician has no duty to provide medical care.

In my view, the correspondence and explanations would not inform a reasonable person in Mrs. Henderson-Briehl's position that the role of the IME doctors was to provide ING with medical opinions on Mrs. Henderson-Briehl's claim for benefits. This is particularly so, since Mrs. Henderson-Briehl had no outstanding claim for benefits at the time. Rather, the correspondence and explanations reinforced Mrs. Henderson-Briehl's expectations that the doctors selected by ING were going to help her.

Mrs. Henderson-Briehl received a copy of Dr. Nathanson's report and felt that it did not fairly deal with her condition. She testified that she performed well on Dr. Nathanson's tests because, although she normally had difficulty sleeping, the night before the examination she had a rare good night's sleep. She felt this fact should have appeared in the report. She testified that she tried very hard on the physical tests because Dr. Nathanson gave her the impression that it was in her interest to push herself and, that as a result of straining herself, she was nauseous the next day. Again, she felt this should have been in the report. She called Dr. Nathanson's office to discuss her concerns and the receptionist told her that she could not talk to Dr. Nathanson and that if she had any concerns she should contact her insurer. Mrs. Henderson-Briehl wrote a letter to Dr. Nathanson, with a copy to the Insurer, setting out the facts which she thought his report should contain. ING's adjuster acknowledged Mrs. Henderson-Briehl's letter and advised her that if she had any further concerns she should contact him or Dr. Nathanson.

She testified that Dr. French was generally polite but belittled her for taking Tylenol number 3. She testified that Dr. French pushed down on her head and that the pain in her neck and right arm increased. She asked Dr. French to stop. Mrs. Henderson-Briehl testified that Dr. French tried to distract her by asking her to watch his finger and as he did so he pushed down on her head again. She told him not to touch her again. She was bewildered when Dr. French told her everything was fine because she was in agony. She went back to her car, took a Gravol and a Tylenol number three and cried.

She testified that she went to work the next day but could not continue because of the pain and went to the emergency department of the McMaster Medical Centre where she was diagnosed with a right cervical disc prolapse. Two days later she saw a neurologist who found that her reflexes suggested inflammation rather than physical impingement or at least a minor component of impingement.

In January 2001, ING's adjuster wrote to Dr. French and, among other things, wrote: "She reported that the last assessment performed in your assessment centre has aggravated her neck."

In April 2001, Mrs. Henderson-Briehl applied for income replacement benefits and agreed to be assessed by Dr. French again. In his report following that examination Dr. French noted that Mrs. Henderson-Briehl complained that she developed such intense headaches and discomfort in her neck following the previous examination, she was unable to continue to work as an assistant teacher. In what I find to be an explanation of why he tried to distract Mrs. Henderson-Briehl in the first examination while he pressed on her head, he reported for the first time: "I was unable to find evidence of non-organic signs to indicate the presence of somatoform (non-organic) pain behaviour."

I accept Mrs. Henderson-Briehl's testimony with respect to her dealings with Dr. Nathanson and Dr. French. She gave detailed evidence which was consistent with everyday experience and consistent with the documents that were created at the time of the events. I also accept that she felt Dr. Nathanson misrepresented himself when he told her that she could contact him when she could not. I also accept that she felt that Dr. French tried to trick her because he didn't believe her when she said that her neck and arm hurt when he applied pressure to her head. I also accept that Dr. French hurt her. When Dr. French tried to distract Mrs. Henderson-Briehl while he applied pressure, it is likely that he was testing for the "non-organic signs to indicate the presence of somatoform (non-organic) pain behaviour" he referred to after his second examination. However, Mrs. Henderson-Briehl did not know this. This conclusion did not appear in Dr. French's first report. From her point of view, Dr. French tried to trick her and he hurt her after she told him to stop.

Mrs. Henderson-Briehl testified that she did not trust these doctors or ING and that she did not believe that ING would refer her to an examination by a doctor she could trust. I believe her feelings were genuine and justified. The main problem was that these doctors examined Mrs. Henderson-Briehl without knowing the benefit to which the examinations related and it was therefore difficult for them to provide an appropriate assessment. As a result, it was easy for Mrs. Henderson-Briehl to trust that the role of these doctors was to help her with her pain and it was reasonable for her to feel that the natural trust she had for doctors was betrayed.

Since the basis of the relationship between an individual and an examining doctor is based on trust, and since Mrs. Henderson-Briehl had valid reasons for not trusting the doctors appointed by ING, it is my opinion that Mrs. Henderson-Briehl was not required to submit to another examination by a health care professional arranged by ING until ING took reasonable steps to restore that trust. Those steps would include explaining to her the purpose of the examinations and the role of the IME doctors.

Amount of income replacement benefit:

The amount of an income replacement benefit is based on the insured's gross income in the four or 52 weeks before the accident. The parties agree that Mrs. Henderson-Briehl's losses from self-employment in the 52 weeks before the accident exceed her income from employment and that if losses are included in the calculation of her gross income, her weekly income replacement benefit is zero. Mrs. Henderson-Briehl had a small profit from self-employment after the accident.

Section 8 of the Schedule sets out the rules for determining gross income. It uses the words "gross annual income." It does not use the words "losses" from employment and no provision specifically provides that losses from self-employment are to be taken into account in calculating "gross annual income."

The only case which considered whether business losses are deducted when calculating "gross income" for the purpose of calculating a weekly benefit is Morin and Lumbermens Mutual Casualty Company⁶ decided under the 1990 Schedule⁷.

If Mr. C's had generated a profit and Mr. Morin had received income from the business, it is my view that he would have been entitled to include it in the calculation of his gross weekly income under section 12 of the No-Fault Benefits Schedule. It follows that, if income from a business would be considered under section 12, losses from that business must also be considered. Weekly income benefits are based on the applicant's income from his or her occupation or employment for the four and fifty-two weeks preceding the accident. An applicant's income situation would certainly be distorted if losses from a business were not taken into account.

Unlike the current Schedule, the 1990 Schedule does not contain a reference to "losses from self-employment." Section 6 of the current Schedule uses the words "losses from self-employment" to provide for the calculation of an income replacement benefit where the insured has losses from self-employment before the accident which increase after the accident.

In my view, the inclusion of the words "losses from self-employment" in section 6 and its omission from section 8 shows a legislative intent that "losses from self-employment" are not included in the calculation of "gross income" in section 8.

Deductions to account for post-accident income:

Under section 6(2), ING is entitled to deduct 80 per cent of the net income received by Mrs. Henderson-Briehl after the accident. The only evidence I received on this issue was Mrs. Henderson-Briehl's 2000 and 2001 income tax returns which Mrs. Henderson-Briehl testified were true.

In the absence of any other evidence as to when the amounts were earned, I took the average weekly gross income for 2000 and 2001 to arrive at weekly gross income of $28.88 per week for the period October 5, 2000 to December 31, 2000 and $16.71 per week for the period January 1, 2001 to February 1, 2001, for which ING is entitled to deduct from any income replacement benefit, 80 per cent of the net income.

SPECIAL AWARD:

Mrs. Henderson-Briehl asked for a special award under section 282(10) of the Insurance Act on the grounds that ING unreasonably withheld payment of income replacement benefits for the period October 5, 2000 to February 1, 2001.

I have determined that Mrs. Henderson-Briehl is not precluded from proceeding to arbitration because she failed to attend medical examinations arranged by ING. I have not determined that Mrs. Henderson-Briehl is entitled to income replacement benefits. Although ING conceded that Mrs. Henderson-Briehl was disabled for the relevant period and that the disability was caused by the motor vehicle accident, it is not a concession that she was entitled to benefits if I found in favour of Mrs. Henderson-Briehl on the preliminary issue.

Even if it was a concession, I have no evidence on what basis ING came to this conclusion and when it came to this conclusion. I therefore could not determine whether ING made a concession in a timely manner.

Lastly, Mrs. Henderson-Briehl applied for income replacement benefits on April 5, 2001, six months after she stopped working on October 4, 2000. This late application prejudiced ING's ability to obtain its own medical assessment on her ability to work during this period. The Employer's Confirmation of Income in support of Mrs. Henderson-Briehl's claim that she was disabled from work since October 4, 2000 was signed on October 30, 2000. Mrs. Henderson-Briehl explained that she did not apply earlier because she thought she would get better, because she was waiting for an appointment with another doctor and because her doctor lost a form. Her explanation did not make sense.

Whether Mrs. Henderson-Briehl was precluded from proceeding with this arbitration under section 50(a) of the Schedule because of her late application for a benefit was not identified as an issue in this hearing. Even though I find that it was unreasonable for ING to insist that Mrs. Henderson-Briehl attend medical assessments, when it had no information that Mrs. Henderson-Briehl sought income replacement benefits, I also find that it was unequally unreasonable for Mrs. Henderson-Briehl to delay submitting her claim for income replacement benefits contrary to section 32 of the Schedule.

Accordingly, I do not find that ING unreasonably withheld or delayed paying income replacement benefits.

EXPENSES:

The parties asked that I not deal with the issue of entitlement to expenses of the arbitration proceeding. If they cannot agree on the issue of entitlement or amount, they may make submissions on both issues in accordance with Rule 79 of the Dispute Resolution Practice Code (Fourth Edition, May 31, 2001).

August 25, 2003

William J. Renahan

Arbitrator

Date

Neutral Citation: 2003 ONFSCDRS 123

FSCO A01-001620

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

MARILYN HENDERSON-BRIEHL

Applicant

and

ING INSURANCE COMPANY OF CANADA

Insurer

ARBITRATION ORDER

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

1. Mrs. Henderson-Briehl is not precluded from proceeding with this arbitration because she failed to attend a medical examination under section 42 of the Schedule.

2. Losses from self-employment are not set off against employment income in the determination of the amount of any income replacement benefit.

3. For the period October 5, 2000 to December 31, 2000, ING is entitled to deduct from any income replacement benefit, 80 per cent of net income based on gross income of $28.88 per week. For the period January 1, 2001 to February 1, 2001, ING is entitled to deduct from any income replacement benefit, 80 per cent of net income based on gross income of $16.71 per week.

August 25, 2003

William J. Renahan

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, 303/98, 114/00 and 482/01.
2. 2And by necessary implication, an arbitration proceeding. See Lopez and Canadian General Insurance Group (OIC P97-00041, April 8, 1998).
3. 3(OIC A-001116, September 4, 1992).
4. 4(FSCO A-000433, May 25, 2001).
5. 5March/April 2003 Policy #8-02.
6. 6(OIC A-001311, June 16, 1993).
7. 7The Statutory Accident Benefits Schedule — Accidents On or Between June 22, 1990 and December 31, 1993, Regulation 612 of R.R.O. 1990, as amended by Ontario Regulations 660/93 and 119/93.