Neutral Citation: 2003 ONFSCDRS 138

FSCO A02-000728

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

DEBRA SNOOK

Applicant

and

ING INSURANCE COMPANY OF CANADA

Insurer

PRE-HEARING DECISION

Before:

Janice Sandomirsky

Heard:

Written submissions from the parties were received on August 8, 2003. Reply submissions were received from Mr. Brown on August 13, 2003, and Mr. Crowley on August 29, 2003.

Appearances:

Louis J. Crowley for Ms. Snook

James K. Brown for ING Insurance Company of Canada

Issues:

The Applicant, Debra Snook, was injured in a motor vehicle accident on October 23, 1997. She applied for and received statutory accident benefits from ING Insurance Company of Canada ("ING"), payable under the Schedule.¹ ING terminated weekly income replacement benefits on October 23, 1999. Ms. Snook disputed that decision and applied for mediation. The parties were unable to resolve their disputes through mediation, and Ms. Snook 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 resumption of the pre-hearing discussion of this case held on July 25, 2003, ING requested the production of defence medical reports from Ms. Snook's tort claim. Ms. Snook objected to the request to produce these documents.

The issue is:

Is Ms. Snook required to produce the following defence medical reports from her related tort proceeding?

FAE reports prepared by Spine & Joint Physiotherapy, dated March 25, 1998 and October 14, 1998;
IME report of Dr. Sequeira, dated February 12, 2002;
Report of Dr. John Mount, dated February 21, 2002;
Records of The Work Strategies Diagnostic Centre from September 1998
Vocational Assessment of Work Return Inc., dated October 1998
Transferable Skills Analysis of Work Return Inc., dated November 1998
Reports of Dr. Michel Lacerte, dated February and March 1999
Labour Market Research from Disability Management, dated February 2002
OT Functional Abilities Assessment of Nancy Gowan, dated March 26, 2002

Result:

Ms. Snook shall produce the following documents from her tort proceeding:

IME report of Dr. Sequeira, dated February 12, 2002
Report of Dr. Mount, dated February 21, 2002
Labour Market Research from Disability Management, dated February 2000
OT Functional Abilities Assessment of Nancy Gowan, dated March 26, 2002

EVIDENCE AND ANALYSIS:

The issue of whether an applicant in an statutory accident benefit arbitration is required to produce documents from a related tort proceeding has been considered in a number of arbitration decisions. Most of the cases referred to me by counsel were released prior to the recent Court of Appeal decision in Tanner v. Clark and Reimer v. Christmas ("Reimer, Tanner").² In that case, the Court of Appeal addressed the issue of whether the implied undertaking rule protected medical reports in an arbitration proceeding from being disclosed in a related tort action. The Court agreed with the finding of the Divisional Court that the implied undertaking rule had no application because the principle behind the rule was to protect against the use of documents by the recipient of the information, not to protect the information from all uses. Carthy, J.A., speaking for the court stated, the following:

In my view, it would do no service to the implied undertaking rule to extend it in this fashion and would, indeed, be a considerable disservice. It would wrap a cloak of privilege around evidence given in any administrative tribunal hearing where a related issue arose in other proceedings. It would stand in the way of courts and tribunals having available the best evidence, or all the evidence, bearing upon the issue in dispute.

As a result, the Court upheld the order for production of the documents on the basis that they were relevant to the tort proceeding and not privileged.

Most of the FSCO decisions released prior to the Court of Appeal decision in Reimer, Tanner, relied on the implied undertaking rule in considering the question of whether the insurer was entitled to production of documents from the related tort file. In a number of cases, the applicant was ordered to produce the tort documents on the basis that the documents in issue came within the exemption to the rule. These decisions balanced considerations of whether the interests of justice served by producing the documents outweighed the prejudice caused by the breach of privacy to the party who disclosed the evidence.³

The only arbitration case that has considered this issue since the Court of Appeal decision is Majer and Kingsway General Insurance Company.⁴ In that case, Arbitrator Killoran distinguished Reimer, Tanner and proceeded to consider the issue before her in the context of an exercise of her authority to control the process by ruling on the production of documents that would not ordinarily be compellable as part of FSCO's pre-hearing process. She found her authority to do so in the following provisions: sections 20 and 22 of the Insurance Act, which grant arbitrators with the authority to decide all issues of fact and law and the same power as vested in the Ontario Court (General Division) to order production of documents; section 15 of the Statutory Powers Procedure Act,⁵ which provides arbitrators the jurisdiction to admit evidence regardless of whether it is admissible in a court; and the Dispute Resolution Practice Code (Fourth Edition, May 31, 2001) which, in addition to the arbitral case law, sets out a comprehensive set of procedural rules and practices designed to ensure a fair, balanced and appropriate level of disclosure to the parties and offer a less expensive and more efficient alternative to a civil action.

In Majer, Arbitrator Killoran declined to exercise her discretion to order production of the transcript of the applicant's examination for discover on the basis that the dispute resolution process at FSCO does not include examinations for discovery and, therefore, a party would gain an unfair advantage if it could obtain production of the transcript from a related tort or other civil action.⁶

In reaching this conclusion, Arbitrator Killoran relied on the reasoning of Director's Delegate McMahon in CAA Insurance Company (Ontario) and Sandhu (FSCO P01-00044, January 18, 2002), which sets out some of the factors to consider in exercising this discretion. Director's Delegate McMahon's analysis started from the premise that the reports are relevant. He then went on to state that:

Any consideration of a request to order production of defence medicals must be made against the backdrop of the insurer's ability to generate medicals within the FSCO proceeding. Section 65(1) of the SABS-94, authorizes the insurer to conduct medical examinations ("IEs") "as often as reasonably necessary." In addition, a dispute over a statutory accident benefit will often trigger an assessment at an independent, government sanctioned assessment centre ("DAC") which sends a report to each party. As a result, an insurer defending a claim advanced at FSCO will rarely be able to assert that it needs the defence medicals to properly assess its exposure or assert its defence.

He concluded that,

In the absence of some compelling reason why the medical reports obtained by the insurer pursuant to the SABS are insufficient, I would not grant the insurer's request for production of the defence medicals from the tort file. The insurer is not prejudiced by the non-production, whereas production of the reports will inevitably and unnecessarily lengthen and complicate the arbitration proceeding.

After reviewing this case law, I agree with the finding in Majer that Reimer, Tanner can be distinguished on the basis that it did not address the question of production of documents in an arbitration proceeding. I also agree that the question of production of documents involves an exercise of discretion having regard to the impact the request for production of documents from a tort proceeding would have on the arbitration process. Some of the factors to consider in exercising this discretion were set out in Sandhu, including the insurer's ability to generate medical reports within the FSCO proceeding, whether there was some compelling reason why the medical reports obtained by the insurer pursuant to the Schedule were insufficient, and whether the production of the reports will unnecessarily lengthen and complicate the arbitration proceeding.

Reviewing the list of documents outlined in ING's submission, I note that a number of them pre-date the termination of benefits in October 1999. I also note that ING already possesses a number of expert reports and assessments from this period. ING did not argue that the reports it obtained pursuant to the Schedule were insufficient. As a result, I find that ordering production of the tort defence reports dating from that period would result in a "doubling up" of the assessments and potentially lengthen and complicate the hearing process. In this circumstance, I conclude that production of the pre-October 1999 reports from the tort claim would not be consistent with the arbitration rules and practices designed to ensure a fair, balanced and appropriate level of disclosure, and a less expense and more efficient alternative to a civil action. Therefore, I decline to order production of the following:

FAE reports prepared by Spine & Joint Physiotherapy, dated March 25, 1998 and October 14, 1998;
Records of The Work Strategies Diagnostic Centre from September 1998
Vocational Assessment of Work Return Inc., dated October 1998
Transferable Skills Analysis of Work Return Inc., dated November 1998
Reports of Dr. Michel Lacerte, dated February and March 1999

Four of the reports were from the period after ING terminated Ms. Snook's benefits in October 1999. ING advised that it did not have any medical examinations or assessments from that period. ING submitted, therefore, that it needs the defence medicals to properly assess whether the Applicant meets the test for entitlement to income replacement benefits two years after the accident. That is, whether she suffers a complete inability to engage in any employment for which she is reasonably suited by education, training or experience.

Although ING has the right to request medical examinations under the Schedule, it appears that it decided not to exercise that right. ING did not explain why it did not request further medical assessments. In light of the fact that there are no defence medical reports for the period after ING terminated benefits, I find the argument for production of those reports more compelling. In my view, production of these medical documents would provide the Insurer with reasonable disclosure and not result in a "battle of numbers." As a result, I decided to exercise my discretion to order production of the following medical reports from the tort claim that post-date the termination of benefits:

IME report of Dr. Sequeira, dated February 12, 2002
Report of Dr. Mount, dated February 21, 2002
Labour Market Research from Disability Management, dated February 2000
OT Functional Abilities Assessment of Nancy Gowan, dated March 26, 2002

September 15, 2003

Janice Sandomirsky Arbitrator

Date