Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2006 ONFSCDRS 182

FSCO A05-001785

BETWEEN:

GANG DAI Applicant

and

ING INSURANCE COMPANY OF CANADA Insurer

ADJOURNMENT DECISION

Before: John Wilson

Heard: By telephone conference call on November 15, 2006.

Appearances: Louis J. Crowley for Mr. Dai Brian Evoy-Smith for ING Insurance Company of Canada

Issues:

The Applicant, Gang Dai, was injured in a motor vehicle accident on June 7, 2002. He 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. The parties were unable to resolve their disputes through mediation, and Mr. Dai 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 case conference held on November 15, 2006, Mr. Brian Evoy-Smith, counsel for ING, requested an adjournment to allow ING to "afford it an opportunity to have the Claimant assessed by a psychologist or a psychiatrist to determine the Claimant's psychological status and to determine entitlement to benefits." As well, ING wished "an opportunity to have the Claimant assessed by a knee specialist to determine the Claimant's medical status and to determine entitlement to benefits."

The issue is:

1. Is ING entitled to an adjournment to have Mr. Dai assessed by a "knee specialist" and a psychiatrist or a psychologist under section 42 of the Schedule?

Result:

1. ING is not entitled to an adjournment of this arbitration.

EVIDENCE AND ANALYSIS:

As in any court or tribunal setting adjournment requests happen. Parties may not be ready for a hearing, witnesses may not be available, or the parties may be on the cusp of settling one or more issues in the dispute and wish to avoid the expense of a hearing while the hope of resolution still survives.

While adjournments may be a fact of life, the arbitration system for accident benefit disputes takes a less pragmatic approach to adjournments than many other forums. In the arbitration forum, adjournment requests must be examined in light of the purposes of the arbitration system, and if found wanting, rejected.

The Introduction to the Dispute Resolution Practice Code (4th edition,) (the Practice Code), which governs arbitrations at the Commission, notes that our procedural rules aim to promote "timely, cost-effective and fair dispute resolution services." Since the principal alternative to arbitration of accident benefits disputes at the Commission is a legal proceeding instituted in the Ontario Superior Court of Justice, the measure of the timeliness and effectiveness of arbitration must be in relation to those courts.

In light of this, the preamble to Practice Note 9, which deals with Adjournments, provides:

The Commission has an obligation to conduct arbitrations efficiently and speedily. Parties are contacted and agree to pre-hearing and hearing dates well in advance of the dates set. Therefore, adjournments are granted only sparingly once dates have been set.

Unlike the traditional rule in the courts, the arbitration system is designed to work on strict time discipline.² Hearing dates are set on the consent of both parties, and are subject to revision only in cases of personal emergencies, the prospect of imminent settlement, the unforeseen unavailability of critical evidence, or the involvement of counsel in an ongoing proceeding that was scheduled to conclude before the time scheduled for the arbitration.

Barring the occurrence of circumstances such as those described above, they are expected to be able to proceed within the agreed time-frame. This is consistent with a system that is designed to be "quicker, less expensive and less formal"³ than the courts.

Notwithstanding the restrictive approach taken by the arbitration system, other factors come into play when considering whether or not to grant an adjournment request. Although ordering on an unwilling party is not unheard of, consideration must be given as to whether a refusal of an adjournment will effectively take away their right to a fair hearing by putting them at some disadvantage. Even the courts will refuse adjournments.

Individual litigants have a right to pursue and defend their respective claims. They must do so, however, within a court structure that must accommodate thousands of individual litigants. That system can function effectively only when litigants take scheduling commitments seriously and make genuine efforts to comply with court orders relating to adjournments and related matters. Where a litigant successfully obtains the adjournment of a trial having failed to exercise due diligence in retaining counsel, that litigant must expect that absent unforseen circumstances, the trial will proceed on the new date.⁴

The other alternative open to an arbitrator is to adjourn, subject to terms or conditions. Rule 72.4 of the Practice Code specifically provides for adjournments being "on such terms as he or she [the adjudicator] considers just." Such conditions usually are created in an attempt to address the prejudice that might arrive to a party due to an adjournment. Although the payment of costs or expenses may be the most common term for an adjournment, orders to stay the process pending fulfilment of certain conditions, the payment of interim benefits, or the suspension of statutory interest have all been used in the context of adjournments at the Commission.

As Laskin J. stated in Khimji v. Dhanani Estate (supra), "Under our modern Rules non-compensable prejudice plays a pivotal role in deciding whether to grant an amendment or an adjournment." If the prejudice to a party cannot be appropriately addressed by the terms of an adjournment order, then the request will likely be refused. The problem in such an analysis, however, is that usually there are competing prejudices to both parties to be balanced in any adjournment decision.

ING's request for an adjournment in this matter, as noted earlier, arises from its perceived need for further medical assessments of Mr. Dai. It claims that it has been taken by surprise in this arbitration, having been served only recently with reports from medical experts whose involvement it had not anticipated, and the content of which it was unaware. Although the reports were legitimately served within the time prescribed by the Practice Code, Mr. Evoy-Smith submitted that ING will be prejudiced at the hearing if it must proceed without further assessments. ING notes that its last psychological assessment was over two years ago.

It goes without saying that to hold further examinations at this stage would necessitate an adjournment of the arbitration hearing. If such reports were to be considered in the arbitration, the examinations must first be arranged, the reports written, and then served on the Applicant at least 30 days prior to a new hearing date. Given competing demands on counsel time, I suspect a significant delay of the hearing process could result from any adjournment.

Given the reasons for the proposed adjournment, ING’s request will necessarily fail if it is not entitled to further section 42 examinations at this time.

In Glynn and General Accident Assurance Co. of Canada (OIC A96-000004, November 25, 1996), Arbitrator Makepeace summarized the normal requirements for insurer's medical examinations.

I find that the Insurer’s right to require the Applicant to attend an Insurer Medical Examination is subject to the following requirements under sections 23(2) and 25:

(i) The examination must be required in respect of a claim for weekly benefits.

(ii) The Insurer may require an IME "as often as it reasonably requires."

(iii) The Insurer must give the Applicant "reasonable notice" that it requires the examination.

(iv) The examination must be performed by a "qualified medical practitioner, psychological advisor or chiropractor."

The second of Arbitrator Makepeaces requirements has engendered significant problems, since each side views the reasonableness of any particular examination through very different lenses.

Later decisions, although recognizing the overall right to require insured persons to submit to medical examinations, have delineated limits to such examinations. Director's Delegate Draper commented in Traders General Insurance Company and Leveyy (FSCO P98-00035, February 25, 1999):

Insurers do not have an absolute right to schedule examinations whenever they want. The examination must be reasonably necessary and scheduled at a time reasonably convenient for the insured person. As Director's Delegate Naylor held in F.S. and Belair Insurance Company Inc. (OIC P96-00039, June 11, 1996), this involves a balancing of the interests of the parties, with the timing of the examination as an important consideration. Absent a clear explanation, examinations scheduled on the eve of the hearing suggest the kind of tactical brinkmanship that arbitrators have properly rejected as part of this system.

In this matter, counsel for Mr. Dai has pointed out that, in addition to being on the brink of the hearing, the formal request for a section 42 examination has not yet been made.

Even if the formalities had been complied with, Mr. Crowley submitted that the knowledge of the psychological and physical aspects of Mr. Dai's claim has not been withheld from the Insurer, and have indeed been the subject of investigations.

The Insurer had the benefit of the notes and records of the psychologist in question, had received several treatment plans from the psychologist, which were the subject of DAC assessments, and had, indeed paid for the treatment when ordered by the DAC. It had ample opportunity to request an earlier psychological examination, had it been so inclined without affecting the arbitration date. Now is too late to claim surprise.

Mr. Dais position on the physiatrist's report, is that the knee injury was front and centre in his claim from the inception. A prudent insurer would have addressed that issue early on in the process, with appropriate updates as required.

Mr. Crowley also pointed out that when the Insurer had a report from its own orthopod which did not favour the Insurer’s position on disability, it followed up with an FAE performed by an Occupational Therapist and a Kineticist, rather than obtaining the opinion of a knee specialist, as it seems to be inclined to do now.

There is no reasonable explanation offered for the Insurer's delay in proceeding with the further investigation of the knee and the psychological problems in a time-frame that would not have affected the arbitration date itself.

It is accepted that the Insurer has the onus of proving that its proposed assessment is reasonable and necessary and is in compliance with the provisions of the Schedule. Given the last-minute nature of this request, it is also incumbent on the Insurer to displace the obvious inference that this is merely "tactical brinkmanship that arbitrators have properly rejected as part of this system."

I note in this context that while Mr. Evoy-Smith has assured me of ING's intention to examine only for the purposes of adjusting the file and re-considering benefits, I am not convinced that this is the sole or even the predominate reason for the proposed assessments. Certainly ING did not offer to undertake that no use would be made of any information obtained in the arbitration process.

While I can accept that the proposed examinations may be useful to the Insurer, and may be a reasonable proposal from the point of view of a defence counsel whose interest is in bolstering his client's case, I do not accept that they are necessarily reasonable in the context of this arbitration scheme.

Even if one were to take the position that, in the interest of having the most complete information before the hearing arbitrator, it would be appropriate to accept the adjournment and permit the assessments to take place, I do not accept that it would be possible to easily address the prejudice to Mr. Dai of significant further delay, without losing sight of the goals of the arbitration process.

As Mr. Crowley pointed out, this is an impecunious applicant who is not receiving any benefits at present. There also is reference by both parties to psychological issues apparently arising from the accident which could well be aggravated by the stress of further delay. It is now over four years since the accident, and Mr. Dai is entitled to a resolution of his claim, one way or another.

I find that, while there may well be some prejudice arising to the Insurer from the absence of further, more recent, assessments, any such prejudice is largely traceable directly to the Insurer's own decisions on file handling. It could have been more pro-active in adjusting and assessing Mr. Dai's claim. It is effectively the author of its own misfortune.

Any analysis of the balance of prejudice, taken in conjunction with the requirements of the arbitration system as set out in the Practice Code, Practice Note 9, and jurisprudence at the Commission, would suggest that ING has not made out a case for an exception in this matter.

I decline therefore to allow this matter to be adjourned. The parties should be prepared to proceed to the arbitration as scheduled on November 20, 2006.

EXPENSES:

I leave any consideration of expenses to the hearing arbitrator.

November 16, 2006

John Wilson Arbitrator

Date

Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2006 ONFSCDRS 182

FSCO A05-001785

BETWEEN:

GANG DAI 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. ING is not entitled to an adjournment of this arbitration.

November 16, 2006

John Wilson Arbitrator

Date

Footnotes

1. 1The Statutory Accident Benefits Schedule — Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.
2. 2Even the courts under case management have adopted a more stringent attitude towards time. A plaintiff chooses the "track" for the litigation. Once something is fast-tracked, "the parties will have to provide very compelling reasons before a case management judge will permit any changes of track or to the timetable." Introduction - Case Management Rules, Ontario Annual Practice. It is important that Rule 77 - Case Management -prevails over any preceding Rule.
3. 3Practice Code Introduction at p. 10
4. 4Khimji v. Dhanani Estate 2004 CanLII 12037 (ON CA), [2004] O.J. No. 320