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

Neutral Citation: 2009 ONFSCDRS 26

FSCO A06-001313

BETWEEN:

BASIL MARTIN Applicant

and

OPTIMUM INSURANCE COMPANY INC. Insurer

Before: Lloyd (J.R.) Richards

Heard: By telephone conference call on January 10, 2009. Written submissions were received from Optimum on February 4, 2009, and from Mr. Martin on February 6, 2009.

Appearances: Louis J. Crowley for Mr. Martin Oliver Guillaume for Optimum Insurance Company Inc.

Issues:

The Applicant, Basil Martin, was injured in a motor vehicle accident on July 21, 2001. He applied for and received statutory accident benefits from Optimum Insurance Company Inc. (“Optimum”), payable under the Schedule.¹ Optimum terminated weekly income replacement benefits on December 13, 2003. The parties were unable to resolve their disputes through mediation and Mr. Martin 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 issues are:

Is Optimum entitled to an order adjourning the arbitration in this case, scheduled for March 23, 24, 25, 26, 2009, until Mr. Martin attends independent medical examinations by a psychiatrist and a physiatrist?
Is Optimum entitled to its production requests as outlined in its Notice of Motion?

Result:

The arbitration hearing in this case will proceed on March 23, 24, 25, 26, 2009.
Mr. Martin and Optimum will exchange documents as outlined on page 8 of this decision.

FACTS

After the motor vehicle accident on July 20, 2001, Mr. Martin was diagnosed with severe cervical/pectoral muscle strain and Grade II Whiplash Associated Disorder. In February and March 2002, at Optimum’s request, Mr. Martin attended functional abilities and physiatry examinations. Optimum paid income replacement benefits to Mr. Martin until December 13, 2003.

Mr. Martin submitted to Optimum a report from Dr. Charles Nelson, a psychologist, dated November 15, 2005. The report noted that Mr. Martin had undergone a cervical fusion operation in June, 2004. The report also diagnosed Mr. Martin with adjustment disorder with reactive depression and anxiety, dysthymia and chronic pain. Optimum ultimately approved the treatment plan recommended in Dr. Nelson’s report.

Mr. Martin applied for mediation of the termination of income replacement benefits on or around November 15, 2005. After a failed mediation, Mr. Martin applied for arbitration on June 14, 2006. Optimum served a response to the arbitration application on or around July 19, 2006.

By letter dated February 23, 2007, Optimum advised Mr. Martin that he was required to attend insurer examinations with a physiatrist and a psychiatrist. The examinations were scheduled for March 8, 2007 and May 7, 2007. On March 7, 2007, Mr. Martin advised Optimum that he would not be attending the examinations.

Optimum’s Submissions

Optimum submits that its request for the two examinations is reasonable and necessary and arises from its obligation to assess Mr. Martin’s condition and entitlement to benefits on an ongoing basis. Optimum relies on the fact that it assessed Mr. Martin only once and that was in February 2002.

Optimum submits that the next contact from Mr. Martin after the 2002 assessment was in October 2005. This was Mr. Martin’s first mention of psychiatric issues and cervical fusion surgery. Optimum alleges that it received this new medical information almost two years after terminating Mr. Martin’s income replacement benefits. It is Optimum’s view that Mr. Martin had a change in condition that warrants a further examination.

Optimum asserts that no hearing dates in this case were booked when it requested that Mr. Martin attend the examinations. It is Optimum’s position that this motion to adjourn the hearing, pending Mr. Martin’s attendance at the examinations, does not constitute late notice. As such, any prejudice suffered by Mr. Martin as a result of a hearing adjournment is because of his own delay.

According to Optimum, it has been working on this motion for some time. The first notice to Mr. Martin of a possible motion to deal with non-attendance at the examinations was on August 8, 2007. Mr. Martin and Optimum agreed at the pre-hearing on August 23, 2007 to delay the motion to allow the parties to explore settlement. Optimum asserts that it attempted, to no avail, to schedule settlement conferences in August, 2007 and January, 2008. Optimum and Mr. Martin then agreed to adjourn the hearing in this matter from August 18, 2008 to March 23, 2009 in order to arrange a private mediation. Optimum attempted to schedule the private mediation between July and September 2008. The parties were unable to get a mediation date.

Optimum gave notice of this motion by letter dated October 22, 2008. The Commission gave a date for the motion on January 9, 2009. Optimum asserts that it was perhaps naïve in attempting to settle the issues in the period between the assessment request and the hearing. Optimum believes that attempting to settle the issues has delayed this motion. Optimum asserts that Mr. Martin has used the prospect of settlement as a shield to delay having the matter of Mr. Martin’s attendance at the examination answered until now.

Mr. Martin’s Submissions

Mr. Martin agrees with Optimum that just because an insurer discontinues a benefit does not mean that it is no longer entitled to assessments. However, when an examination is scheduled for the purposes of arbitration, an applicant should not be compelled to attend the examination. Mr. Martin asserts that he has always maintained that he would not attend the examination. Optimum made the examination request in 2007 only after mediation had concluded, an application for arbitration had been filed and Optimum had filed its response to the arbitration application.

Mr. Martin notes that Optimum had the “new information” in its possession since 2005 and made the examination request in 2007. Mr. Martin claims that he also forwarded progress reports to Optimum. Further, at the time Optimum requested the examination, it was already copying all correspondence to its counsel.

Mr. Martin maintains that if the examination was for adjusting purposes, the motion to adjourn the hearing would have been brought earlier. Rather, Optimum threatened to bring the motion for attendance at the examination if Mr. Martin did not agree to settle the issues.

It is Mr. Martin’s position that he has always attempted to facilitate any scheduling requests in this case. Mr. Martin agrees that he and Optimum were amenable to a private mediation and consented to the adjournment in August 2008. Mr. Martin alleges that Optimum’s claim that it had little success in scheduling the private mediation and this motion is not factual. Mr. Martin sent a detailed letter to Optimum in October 2008 to facilitate scheduling this motion.

It is Mr. Martin’s position that the application for arbitration was filed in June 2006. It has now been near 3 years since the original application. The original adjournment was for the hearing to be scheduled for no later than March 2009. Throughout this period, Optimum has had the opportunity to bring this motion. Mr. Martin maintains that even if the insurer examination is reasonable, to grant an adjournment now would be prejudicial to him.

EVIDENCE AND ANALYSIS:

Optimum relies on Bogic and AXA Insurance (Canada).² The arbitrator in that case listed principles dealing with insurer examination requests and hearing adjournments that had been set out in previous decisions. In Bogic, the insurer terminated weekly benefits on June 25, 1994 based on an insurer examination it had recently completed. The applicant continued treatment and investigations in 1995 and 1996. The applicant submitted a report to the insurer in August 1998 indicating that he had a closed head injury. The report suggested further investigation. The insurer requested an examination in August 1998. The applicant refused. The applicant attended his own examinations in November and December 1998.

I find that Bogic is distinguishable from this case. In this case, Optimum terminated Mr. Martin’s income replacement benefits on December 13, 2003. Optimum first became aware of Mr. Martin’s surgical fusion operation and other mental health issues in a report dated November 15, 2005. Optimum, by letter dated February 23, 2007, advised Mr. Martin that he was required to attend two insurer examinations. This is some 15 months after receiving notice of what Optimum itself asserts are serious medical conditions.

In Bogic, the insurer requested the examinations in the same month it received new information. Further, the applicant’s position in Bogic was that the insurer would have to stand on its previous refusal and its supporting documentation for the termination. Mr. Martin has maintained that Optimum is entitled to its examinations for the purposes of adjusting the file, but he is refusing to attend them because the insurer is requesting the examinations solely to buttress its case at arbitration.

In Bogic, the arbitrator made the following ruling:

Where there is a claim for ongoing benefits, and a lengthy period of time has transpired since the most recent examination, it is fair, and hence reasonable for an insurer to request further examinations in order to evaluate an applicant’s claim. Further examinations are also reasonable where there have been changes in the nature of the insured person’s medical or psychological condition which are relevant to his or her disability claim. However, it is unreasonable to request an examination where circumstances indicate that its only apparent purpose is to acquire medical evidence to bolster the insurer’s case at hearing.

I find that Optimum had ample opportunity to assess Mr. Martin’s injuries. Optimum could have assessed Mr. Martin at any time after income replacement benefits were terminated. Optimum and Mr. Martin agree that Mr. Martin continued to receive medical benefits after income replacement benefits were terminated. Optimum chose to request an examination well after Mr. Martin had provided new medical information and after it had already filed its response to Mr. Martin’s arbitration application. I heard no evidence that Mr. Martin delayed producing information to Optimum or failed to keep Optimum updated on his medical status.

I find no evidence that either side unduly delayed these proceedings. Optimum’s claim that Mr. Martin has taken advantage of its generosity in attempting to facilitate settlement is not supported by the evidence. It appears both Optimum and Mr. Martin have been interested in settlement. However the inability to find mutually agreeable dates for a private mediation or settlement conferences did not preclude Optimum from seeking an early motion date to deal with Mr. Martin’s attendance at the examinations. In any event, the timing of this motion has no bearing on the fact that Optimum has requested examinations where circumstances indicate that its only apparent purpose is to acquire medical evidence to bolster its case at hearing.

I do not find it reasonable that Optimum requested the insurer’s examination in February 2007. Optimum made the examination request well after it had received information that Mr. Martin’s condition had changed. Optimum presented no evidence that it was continuing to adjust its file. Optimum could have sought examinations as early as November 2005. In Nandkumar and Economical Mutual Insurance Company³, the arbitrator stated:

In my view, requests for the insurer medical examinations during the final stages of a legal dispute must be regarded as inherently linked to their interests in advocating their position, as opposed to normal adjusting investigation.

Optimum had attended a pre-hearing, filed its response to Mr. Martin’s application for arbitration, and copying correspondence on Mr. Martin’s file to its counsel, and 15 months had elapsed since it received new information about Mr. Martin’s condition, before it decided to request insurer examinations. In the totality of the circumstances of this case, Optimum’s request for examinations is not reasonable.

DOCUMENT PRODUCTION

Below, I reproduce the oral production order that I made at the teleconference hearing in this case.

Mr. Martin will provide to Optimum by February 13, 2009, a decoded OHIP summary from one year prior to the accident date. If there are any further issues in respect of production requests arising out of the OHIP summary, Mr. Martin and Optimum will return to the Commission and seek an order;
Mr. Martin will provide to Optimum the clinical notes and records of Dr. Maxted for one year prior to the motor vehicle accident date;
Mr. Martin will provide to Optimum his income tax returns for one year prior to the motor vehicle accident date;
Mr. Martin has already provided his complete employment file from Lang’s Bus Lines for one year prior to the motor vehicle accident date;
Mr. Martin will provide any medical records or information in his long term disability file, including a payment summary;
Mr. Martin has already provided to Optimum the complete records from Active Joint Physiotherapy Centre and the complete clinical notes and records of Drs. Charles Nelson and Gail Delaney;
Mr. Martin will provide to Optimum by February 20, 2009, if it has not already been provided, the complete clinical notes and records related to the cervical fusion performed in 2004, including all surgical records;
By February 20, 2009, Optimum will provide to Mr. Martin complete copies of the accident benefits file and the independent adjuster’s file relating to the July 21, 2001 motor vehicle accident. The copies will include all adjusters’ notes, records, memos to file, emails (including all supervisors’ emails) and all correspondence. If there is anything Optimum refuses to produce, Optimum will produce a list of such documents with the basis for the refusal. The list will identify the documents in sufficient detail to allow Mr. Martin to challenge the refusal to produce the documents. Optimum will also identify and produce any investigation reports and any surveillance reports and records.

EXPENSES:

Optimum and Mr. Martin may return to me for any expense claims for the hearing of this motion, if they are unable to resolve such claims themselves, as set out in Rule 79 of the Dispute Resolution Practice Code.

February 20, 2009

Lloyd (J.R.) Richards Arbitrator

Date