Financial Services Commission des Commission services financiers of Ontario de l’Ontario

Neutral Citation: 2008 ONFSCDRS 90

FSCO A07-000872

BETWEEN:

JEAN FORSYTH

Applicant

and

ACE INA INSURANCE

Insurer

Before: Arbitrator John Wilson

Heard: By teleconference on May 2, 2008

Appearances: Nick Romano and Joseph Marcuccio for Mrs. Forsyth Lisa Neil for ACE INA Insurance

Issues:

The Applicant, Jean Forsyth, was injured in a Greyhound bus accident on June 30, 2004. She applied for statutory accident benefits from ACE INA Insurance (“ACE”), payable under the Schedule.¹ The parties were unable to resolve their accident benefit disputes through mediation, and Mrs. Forsyth applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The preliminary issue is:

Is ACE/INA entitled to an order that Mrs. Forsyth attend further psychological and orthopaedic section 42 assessments, and that this matter be adjourned to a later date to accommodate the above examination?

Result:

ACE/INA is not entitled to the above orders.

EVIDENCE AND ANALYSIS:

ACE/INA has moved for last minute insurer’s examinations of Mrs. Forsyth, and consequentially for an adjournment of this arbitration to permit those examinations. It supports its request based on the filing by Mrs. Forsyth of a report by Stephen Glenney, O.T., and its need to respond thereto.

The Introduction to the Dispute Resolution Practice Code (4th Edition, Updated October 2003) (the “Code”), which governs arbitrations at the Commission, notes that our procedural rules aim to promote “timely, cost-effective and fair dispute resolution services.”

ACE/INA’s request for an order compelling a further section 42 examination in this matter, as noted earlier, arises from its perceived need for further medical assessments of Mrs. Forsyth. It claims that it has been taken by surprise in this arbitration, having been advised only recently that there was a psychological component to Mrs. Forsyth’s accident-related impairments.

ACE/INA notes that to date it has had neither a psychiatric nor an orthopaedic assessment.

With the hearing scheduled to commence within weeks, it goes without saying that to hold further examinations at this stage would necessitate an adjournment of the arbitration hearing. If any reports are 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 that a significant delay of the hearing process could result from any adjournment.

I accept Mrs. Forsyth’s position that additional insurer’s examinations at this point in the process are inappropriate. Primarily, my decision rests on the timing of this motion.

Mrs. Forsyth contends that the Insurer has been aware of both the psychological and orthopaedic elements of her impairment since early on in this claim. The documentary evidence cited by Mr. Romano appears to support that contention.

The Insurer clearly had the benefit of the medical notes and records, including the references to psychological aspects of Mrs. Forsyth’s disability, in the notes and records from Mrs. Forsyth’s treatment after the accident. I cannot understand how it was not aware that Mrs. Forsyth’s claim contained elements within the expertise of both a psychologist/psychiatrist and an orthopod.

Director’s Delegate Draper commented in Traders General Insurance Company and Levey²:

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.

On the face of it, however useful an assessment might be to the insurer, this motion appears an exercise in trial brinksmanship. I do not accept that the Insurer’s “clear explanation” is adequate to dissipate this inference.

Even without the last-minute nature of this motion, there are some serious procedural challenges that would also lead me to deny the Insurer’s request. Section 42 of the Schedule reads as follows:

(1) For the purposes of assisting an insurer determine if an insured person is or continues to be entitled to a benefit under this Regulation for which an application is made, an insurer may, as often as is reasonably necessary, require an insured person to be examined under this section by one or more persons chosen by the insurer who are members of a health profession or are social workers or who have expertise in vocational rehabilitation.

While I can assume a psychological and an orthopaedic orientation to the proposed examinations due to the reference to those practitioners in submissions, no health practitioner other than an OT is named in the OCF-25 attached as Exhibit “A” to the Insurer’s affidavit. I note that the proposed examinations relevant to this motion are to be performed by a psychiatrist and an orthopod.

While the Insurer may have assumed a further refusal based on its experience with the OT examination, it is difficult to come to any informed conclusion as to the circumstances surrounding an examination without at least some sort of evidentiary framework relating to that examination. What we have with regard to both the psychiatric and orthopaedic examinations is essentially a bare claim for an assessment without any surrounding context beyond the limited affidavit material based on information and belief.³

While I accept that there is evidence to support the Insurer’s contention that there may be both a psychological and an orthopaedic aspect to Mrs. Forsyth’s claimed disability and the Insurer has clearly shown that it wants further examinations, it has not adequately addressed either the necessity or the appropriateness of such examinations in the context of this arbitration, at this time. Nor has it countered Mrs. Forsyth’s suggestion that it knew of those aspects of her claim from the beginning of this dispute

Although I note the lack of supporting evidence in support of compliance with the prerequisites of these particular examinations, I am also concerned by other aspects of the request.

An insurer has a positive obligation to assist its insured or deemed insured in claiming entitlement accident benefits. Insureds are often unrepresented in the early stages of the claim process and often need guidance as to the benefits available to them as well as the procedures for advancing their claim. Section 42 examinations exist in the context of fulfilling that obligation, and ensuring that valid claims are dealt with promptly.

If an insured’s reported post-accident status has a psychological overlay, then it is appropriate for an insurer to initiate an investigation to determine whether a benefit is payable. The eve of a hearing, barring exceptional circumstances, is too late to claim surprise and request an insurer’s examination under section 42 of the Schedule. A prudent insurer would likely have addressed any lack of necessary medical information early on in the process, with appropriate updates as required.

While there is some limited evidence before me in the Insurer’s affidavit of compliance with the notice pre-conditions for a valid section 42 insurer’s examination by an Insurer, that evidence consists primarily of the notice of a different examination attached as an exhibit to the Insurer’s affidavit.

The affidavit of Carolyn Davis (the Insurer’s affidavit) does not address another secondary prerequisite of an examination-consultation with regard to the examination date. Nor is there evidence before me to characterize any proposed examination as properly for the purposes of determining Mrs. Forsyth’s entitlement to benefits at this point. These are all related requirements of section 42 examinations.

In the materials filed in support of this motion, there is no reasonable explanation offered for the Insurer’s delay in proceeding with the further investigation of the potential psychological and orthopaedic problems in a time frame that would not have affected the arbitration date itself.

I note that the accident took place on June 30, 2004, some four years ago, and that Mrs. Forsyth is now 80 years old and still claiming to be suffering from the consequences of the bus accident. Timeliness for Mrs. Forsyth is clearly a very different concept from that understood by either Greyhound or its insurer, ACE/INA.

Although there is a certain apparent element of unfairness in a situation where Mrs. Forsyth may be able to file a medical report, while the Insurer may be prevented from obtaining a late report on the same or related topics, it should be remembered that the institutional side of this equation, the insurer, has the resources and the tools available to it to investigate a matter thoroughly. In making the conscious choice not to initiate certain investigations in a timely manner, it is taking a step, the consequences of which it must live with.

I do not accept that the filing of a report related to an examination in a known area of treatment, and which the Insurer knew was going to take place, necessarily constitutes the late provision of new medical evidence. This is so especially when the actual report was served within the time-frame provided for by the Code.

The Insurer is, of course, free to request that the hearing arbitrator disregard, refuse to admit, or give a lesser weight to any expert opinion whose creation or entry into evidence gives rise to a perception of unfairness or undue prejudice. On the face of the materials submitted to me, I do not see any grounds for such an unusual pre-emptive order at this time in a situation where the requirements of the Code appear to have been met.

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 relatively late timing of this request, it is also incumbent on the Insurer to displace the obvious inference that a last-minute request for an assessment is merely “tactical brinkmanship that arbitrators have properly rejected as part of this system.”

The Insurer has suggested that an examination is available at any time for the purposes of the Schedule. In this context, however, there is no assurance here of the intention to examine only for the purposes of adjusting the file and reconsidering benefits.

It should be noted as well that counsel for Mrs. Forsyth asked the Insurer to confirm the benefits for which the assessments were claimed. In this case, attendant care benefits⁴ were targeted by the assessment which, in Mr. Romano’s submission, brings into play section 39(10) of the Schedule which provides:

(10) If more than 104 weeks have elapsed since the accident, the insurer shall not require the insured person to be examined under section 42 to determine the insured person’s entitlement to attendant care benefits and the insured person shall not submit nor be required to submit an assessment of attendant care needs to the insurer unless,

(a) the insured person is or may be entitled under section 18 to receive attendant care benefits more than 104 weeks after the accident; and

(b) at least 52 weeks have elapsed since the last examination under section 42. O. Reg. 546

Since there is no evidence of a catastrophic impairment designation or even of an application to be so considered, and more than 104 weeks have elapsed since the accident, I accept that any section 42 examinations related to attendant care would be barred by this section.

Given the timing of the argument in favour of further assessments, and the delay in moving forward on the issue, I am not convinced that the adjustment of the claim is the sole or even the predominate reason for the proposed assessments. Certainly, ACE/INA did not offer to undertake that no use would be made of any information obtained in the arbitration process. Although it is not necessarily determinative of the issue, it appears that what ACE/INA wants is, in fact, a further defence medical, something that is not provided for either in the Schedule or the Code.

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 her client’s case, I do not accept that they are necessarily reasonable in the context of this arbitration scheme.

Mrs. Forsyth suggests that she would be prejudiced by any delay brought about by the proposed assessments. 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 adjourn the hearing and permit the assessments to take place, I do not accept that it would be possible to easily address the prejudice to Mrs. Forsyth of significant further delay, without losing sight of the goals of the arbitration process, including that of timely resolution of disputes.

In the absence of misconduct by Mrs. Forsyth or her counsel, or the active suppression of evidence, Mrs. Forsyth, at this late date, should not be further prejudiced by the dilatory approach of ACE/INA in assessing her needs.

I accept 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 Mrs. Forsyth’s claim. To this extent at least, it is effectively the author of its own misfortune.

More fundamentally however, in this case, while there is provision in the Schedule for insurer’s examinations, “for the purposes of assisting an insurer to determine if an insured person is or continues to be entitled to a benefit…”, the question appears to be entirely hypothetical at this time. There is no evidence that the Insurer has properly notified Mrs Forsyth of medical appointments for psychiatry and orthopaedic assessments under section 42 and that she has failed to attend without a valid reason.

Even were all the prerequisites to a section 42 examination in place I am not convinced that I have any authority to issue “an order that the applicant submits to insurer examinations pursuant to section 42”, as requested by the Insurer. While I may rule on the consequences of a failure of an insured to make him or herself available for a section 42 examination, I am unaware of any authority granted to an arbitrator to directly compel attendance at such an examination.

Nor am I convinced that I have the jurisdiction to make a declaratory order judging an as yet hypothetical examination to be reasonable and necessary without evidence relating to compliance with the statutory pre-conditions. Patently the dispute has not crystallized until those conditions are met and attendance has been refused.

For the above reasons the Insurer’s request that Mrs. Forsyth be ordered to attend certain medical examinations is declined. Consequently, there will be no adjournment arising from the need to accommodate those examinations.

EXPENSES:

I exercise my discretion to award Mrs. Forsyth her expenses incurred in this motion hearing. If the parties are unable to agree on the amount of expenses within the next 30 days, they may make brief written submissions on that issue.

June 12, 2008

John Wilson Arbitrator

Date