Denise Gonsalves v. Certas Direct Insurance Company, 2008 ONFSCDRS 204

Financial Services Commission des

Commission services financiers

of Ontario de l’Ontario

Neutral Citation: 2008 ONFSCDRS 204

FSCO A08-001248

BETWEEN:

DENISE GONSALVES

Applicant

and

CERTAS DIRECT INSURANCE COMPANY

Insurer

DECISION ON A PRELIMINARY ISSUE

Before: Arbitrator Denise Ashby

Heard: By telephone conference call on December 15, 2008

Appearances: Amin Sachedina, for Mrs. Gonsalves

Todd J. McCarthy for Certas Direct Insurance Company

Issues:

The Applicant, Denise Gonsalves, was injured in a motor vehicle accident on August 25, 2005. She applied for and received statutory accident benefits from Certas Direct Insurance Company (“Certas”), payable under the Schedule.¹ Certas denied weekly non-earner benefits. The parties were unable to resolve their disputes through mediation, and Mrs. Gonsalves 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:

Is it reasonably necessary for Mrs. Gonsalves to attend an orthopaedic examination pursuant to section 42 of the Schedule?
Is it reasonably necessary for Mrs. Gonsalves to attend a psychiatric examination pursuant to section 42 of the Schedule?
In the event the examinations are determined to be reasonable, is Certas entitled to a stay of these arbitration proceedings until Mrs. Gonsalves has attended?

Result:

It is not reasonably necessary for Mrs. Gonsalves to attend an orthopaedic assessment.
It is reasonably necessary for Mrs. Gonsalves to attend a psychiatric assessment.
The arbitration proceedings are stayed pending Mrs. Gonsalves’ attendance at the psychiatric assessment.

EVIDENCE:

Background:

On August 25, 2005, Mrs. Gonsalves was a passenger in a vehicle which was rear ended. As a result of the accident, she was taken to hospital by ambulance where she stayed for approximately two weeks recovering from accident related surgery.

An arbitration hearing is scheduled for four days commencing on September 21, 2009. The issues for arbitration are Mrs. Gonsalves’ claims to a non-earner benefit, a special award and interest. Both parties are seeking their expenses.

Submissions:

Certas seeks an order that it is reasonably necessary that Mrs. Gonsalves attend an orthopaedic assessment on February 23, 2009 and a psychiatric assessment on March 26, 2009 pursuant to section 42 of the Schedule. It submits that the dates set for the appointments will not delay the hearing. It anticipates that both of its experts will release their reports in sufficient time to meet the disclosure provisions of the Dispute Resolution Practice Code.

Certas relies on the fairness principle enunciated in the appeal decisions in F.S. and Belair Insurance Company Inc. and Ramalingham and State Farm Mutual Automobile Insurance Company.² It submits that while the assessments may assist in the adjusting of the file, their dominant purpose is defending against Mrs. Gonsalves’ claim at arbitration. Certas also cited Lopez and Allstate Insurance Company of Canada, and Rennato and State Farm Mutual Automobile Insurance Company in which the arbitrators determined the respective insureds had failed to make themselves reasonably available for DAC assessments.³

Mrs. Gonsalves submits that the proposed assessments are not reasonably necessary for the adjusting of her file and are sought merely to strengthen Certas’ case at arbitration. She relies on case law upholding the principle that section 42 medical examinations are not reasonably necessary where an insurer seeks the examinations to “bolster its case” in arbitration.⁴

Facts:

As a result of the accident, Mrs. Gonsalves sustained a left sacroiliac joint disruption, a left acetabular fracture, a left tibial fracture and a mid-shaft left femur fracture. She underwent surgery in respect of her injuries and her orthopaedic surgeon, Dr. Ford, completed a Disability Certificate (OCF-3) on October 3, 2005. He noted that Mrs. Gonsalves did not suffer a substantial inability to carry on a normal life. Dr. Ford provides no explanation for his opinion. He estimated the duration of Mrs. Gonsalves’ disability to be more than 12 weeks. He also noted that Mrs. Gonsalves was substantially disabled from performing the essential tasks of her employment at the time of the accident and was substantially disabled from performing the tasks of any future employment for a period of more than 12 weeks.⁵

On September 21, 2005, an In-home Assessment was conducted, at Mrs. Gonsalves’ home, by an Occupational Therapist (O.T.) retained by Certas. Mrs. Gonsalves reported that she continued to have intermittent nightmares and tearful episodes. The assessor recommended a follow-up assessment of Mrs. Gonsalves’ physical and functional status and continued education in the use of the recommended assistive devices. A Form 1 was completed that recommended $2,676.72 in monthly attendant care.⁶

On November 23, 2005, Certas issued an OCF-9 denying non-earner benefits based on a Disability Certificate (OCF-3) dated October 3, 2005. Certas reasoned:

You do not qualify for a non-earner benefit because you do not suffer a complete inability to carry on a normal life. This decision is based on the OCF-3 Disability Certificate that was completed on Oct. 3, 2005.⁷

On February 6, 2006, Mrs. Gonsalves was assessed by Dr. David P. Kosinec, a psychologist. He recommended 12 sessions of psychotherapy followed by a reassessment.⁸

Dr. Kosinec had 8 treatment sessions with Mrs. Gonsalves. These sessions focused on her post traumatic stress symptoms. In his discharge note dated July 18, 2006, Dr. Kosinec states:

At the three week follow-up the client reported that her posttraumatic stress symptoms had remained improved…The client was given an appointment for a follow-up session in one month. The client subsequently cancelled the follow-up session as she was feeling that she had accomplished her goals and did not require further treatment.⁹

On February 16, 2006 a second In-Home Assessment was conducted by an O.T. retained by Certas. The assessor noted that Mrs. Gonsalves reported being “depressed, irritable and angry since the accident.”¹⁰

On August 31, 2006, a third In-home Assessement was conducted in respect of Mrs. Gonsalves’ claim for housekeeping benefits. Again the assessor noted that Mrs. Gonsalves reports being depressed. She concluded that, notwithstanding Mrs. Gonsalves’ subjective reports of being unable to perform her pre-accident housekeeping tasks, Mrs. Gonsalves was not substantially disabled.¹¹

On October 23, 2006, Dr. F. Langer, an orthopaedic surgeon retained by Mrs. Gonsalves, assessed her and prepared a rebuttal report. In Dr. Langer’s opinion Mrs. Gonsalves “has a significant disability for doing any of the strenuous housekeeping/home maintenance activities…”.¹²

In October 2007 Mrs. Gonsalves filed an Application for Mediation claiming a non-earner benefit. Certas submits that this was the first notice it had of Mrs. Gonsalves’ intention to assert a claim for non-earner benefits based on its denial dated November 23, 2005.

On November 27, 2007, Mrs. Gonsalves was assessed by Dr. D.J. Ogilvie-Harris, an orthopaedic surgeon. He was of the opinion that Mrs. Gonsalves continued to have a “serious” accident related impairment that limits her ability “to carry out her heavier household chores.”¹³

On February 23, 2008, Mrs. Gonsalves obtained a second OCF-3 from her family physician in which he noted, under the non-earner category, that Mrs. Gonsalves suffers a complete inability to carry on a normal life. In the Task/Activity Limitations section of the non-earner category, he provided an explanation of diminished mobility due to pain as a consequence of multiple fractures with an anticipated duration of more than 12 weeks.¹⁴

On March 12, 2008, a Report of Mediator was issued. Mrs. Gonsalves’ claim for a non-earner benefit was unresolved.

On April 16, 2008, Certas’ adjuster advised Mrs. Gonsalves that her request for psychological assessment as part of a chronic pain assessment was denied based on a paper review. The assessor concluded that a further psychological assessment was not reasonable because Mrs. Gonsalves’ prior treatment, with Dr. Kosinec, had resolved her psychological issues.

On May 12, 2008, the psychologist whose assessment recommendation had been denied provided a rebuttal report.¹⁵

ANALYSIS:

Subsections 42(1) and (3) of the Schedule, in force on August 25, 2005, provide as follows:

(1) For the purpose of determining whether an insured person is entitled to a benefit for which an application is made, an insurer may give the insured person notice requiring the insured person 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.

(3) The insurer may require examinations as often as is reasonably necessary.

In FS and Belair, the Director’s Delegate stayed proceedings until the insured had attended an insurer’s examination pursuant to a similar provision in The Statutory Accident Benefits Schedule — Accidents on or after January 1, 1994, reasoning that:

The Insurance Act and the Statutory Powers Procedure Act, R.S.O. 1990, Chap S.22, as amended, contemplate the making of orders, including the authority to make interim orders subject to conditions, to conduct a fair hearing: orders that balance the rights of both parties while safeguarding the interests of the party being examined. The arbitrators power includes the discretion, in appropriate cases, to refuse to adjourn a hearing to allow an insurer time to conduct

a medical examination, where to do so would be unfair to the applicant. It also includes the power, under section 21 of the Statutory Powers Procedure Act, to adjourn the hearing to permit an adequate hearing to be held, in the event that an applicant has refused to attend a reasonably required examination. In the exercise of such discretion, the arbitrator is not ordering a medical examination, as discussed in Granic, in the absence of an express or implied power to do so. Rather, the adjudicator is controlling the exercise of an extant power to require a medical examination conferred on one of the parties to the process.¹⁶

I agree that arbitrators have broad discretion to preserve the integrity of the adjudicative process. As well, the preservation of “an adequate hearing,” may in some exceptional circumstances, require a determination that an insurer’s examination is reasonably necessary. The exercise of this discretion in respect of section 42 should be exercised cautiously. In most circumstances the analysis should be determined by the following criteria:

the timing of the request, especially whether it will require the hearing to be adjourned;
whether the claimant disclosed relevant materials as soon as reasonably possible in accordance with the Dispute Resolution Practice Code and whether the insurer made its IE request as soon as it reasonably determined the need for the examination;
what other information is available to the insurer, including information provided by the claimant and the number, nature and date of previous insurer examinations;
whether information provided by the claimant since the insurer’s last insurer examination suggests a new diagnosis, a change in the claimant’s condition or a new direction in medical investigation of it;
whether there is a reasonable nexus between the requested examination and the insured person’s injuries;
whether the insurer accepts the claim and continues to pay benefits; and
generally whether the request is reasonable considering the balance between the insured person’s right to privacy and the insurer’s ongoing right and obligation to assess the claim.¹⁷

Orthopaedic Examination:

In respect of Certas’ request for an orthopaedic examination, Mrs. Gonsalves was most recently examined by Dr. Ogilvy-Harris on December 7, 2007. Certas did not seek a section 42 examination until the pre-hearing in October 2008.

It is undisputed that as a consequence of the accident Mrs. Gonsalves’ suffered serious orthopaedic injuries which required surgery. In denying Mrs. Gonsalves’ non-earner benefits, Certas relied on her orthopaedic surgeon’s Disability Certificate of October 3, 2005 in which he stated Mrs. Gonsalves did not meet the criteria. On November 23, 2005, Certas issued a denial of a non-earner benefit. Certas does not seek to have Mrs. Gonsalves reassessed by Dr. Ford, the surgeon on whose opinion it relied, but rather to obtain a new opinion to respond to Dr. Langer’s report of October 23, 2006 and Dr. Ogilvy-Harris’ December 2007 report. There is no evidence that Mrs. Gonsalves’ orthopaedic symptoms present a new diagnosis, a change in her condition or a new direction in medical investigation.

There is no suggestion that Mrs. Gonsalves delayed disclosure of her physician’s Disability Certificate of February 2008.

Certas has not deviated from its position that Mrs. Gonsalves is not entitled to a non-earner benefit and has not paid the benefit.

On the basis of the foregoing, I find that Certas does not meet the criteria enumerated above.

I do not find that the circumstances of this matter lead to a conclusion that a section 42 orthopaedic examination is required to ensure an adequate hearing. Dr. Ogilvy-Harris’ report provides reasonably current orthopaedic medical information which may assist the hearing arbitrator in determining Mrs. Gonsalves’ eligibility to a non-earner benefit. Therefore, I find that the orthopaedic assessment presently scheduled for February 23, 2009 is not reasonably necessary.

Psychiatric Assessment:

Mrs. Gonsalves has consistently complained of depression, notwithstanding Dr. Kosinec’s discharge note. Mrs. Gonsalves’ claim for a non-earner benefit is based on her physician’s February 2008 opinion that she suffers from chronic pain and symptoms of depression. He recommended a psychiatric assessment.¹⁸ When Mrs. Gonsalves sought a further psychological assessment, it was denied by Certas.

Mrs. Gonsalves has not been psychiatrically assessed in respect of these proceedings. In light of her physician’s opinion and recommendation, I find that a psychiatric assessment would assist an arbitrator in determining Mrs. Gonsalves’ entitlement to a non-earner benefit and is required to maintain an adequate hearing process. As well, I find that the assessment presently scheduled for March 26, 2009 is not likely to delay the hearing such that an adjournment is required. Therefore, I find that the psychiatric assessment is reasonably necessary.

I find that this arbitration proceeding should be stayed until Mrs. Gonsalves attends the psychiatric examination in furtherance of the objective of preserving an adequate hearing process.

EXPENSES:

Neither party made submissions in respect of the issue of expenses. As each party is seeking their expenses at the hearing this issue will be deferred to the discretion of the hearing arbitrator.

December 30, 2008

Denise Ashby

Arbitrator

Date