Moinder Sekhon v. RBC General Insurance Company, 2010 ONFSCDRS 37

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

Neutral Citation: 2010 ONFSCDRS 37

FSCO A08-002442

BETWEEN:

MOINDER SEKHON

Applicant

and

RBC GENERAL INSURANCE COMPANY

Insurer

DECISION ON A PRELIMINARY ISSUE

Before: Jeffrey Rogers

Heard: By written submissions, completed on March 8, 2010.

Appearances: Mr. Ben Fortino, solicitor for Ms. Sekhon Mr. Aldo Picchetti, solicitor for RBC General Insurance Company

Issue:

The preliminary issue is:

Is Ms. Sekhon precluded from proceeding to arbitration of her claim for income replacement benefits because her application for mediation was filed beyond the two-year limitation period set out in section 281.1 of the Act and section 51(1) of the Schedule?

Result:

Ms. Sekhon is not precluded from proceeding to arbitration of her claim for income replacement benefits by operation of the two-year limitation period set out in section 281.1 of the Act and section 51(1) of the Schedule.

EVIDENCE AND ANALYSIS:

The Applicant, Moinder Sekhon, was injured in a motor vehicle accident on July 11, 2003. She applied for and received statutory accident benefits from RBC General Insurance Company (“RBC”), payable under the Schedule.¹ The parties disagree on Ms. Sekhon’s entitlement to certain further benefits. They were unable to resolve their dispute through mediation, and Ms. Sekhon applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

A pre-hearing discussion was held on November 2, 2009. At the pre-hearing, a preliminary issue hearing was scheduled to address RBC’s defence that Ms. Sekhon is precluded from proceeding to arbitration of her claim for further income replacement benefits, because her application for mediation was filed beyond the two-year limitation period set out in section 281.1 of the Act and section 51(1) of the Schedule.

The preliminary issue hearing was conducted by way of written submissions. The facts are not in dispute. They are as follows:

Following the accident of July 11, 2003, RBC obtained a statement from Ms. Sekhon on November 19, 2003. Ms. Sekhon informed RBC at that time that she was employed as a part-time supply teacher for the Grand Erie District School Board and that she was currently working.
RBC sent Ms. Sekhon an Explanation of Benefits (OCF-9), dated December 19, 2003. In this OCF-9, RBC acknowledged receipt of an Application for Accident Benefits which indicated that Ms. Sekhon’s injuries prevented her from returning to work. RBC informed Ms. Sekhon that “[W]e continue to await your completed Employer’s Confirmation of income to determine if you are eligible for this benefit. We will also require your completed OCF-3 Disability Certificate that medically supports any disability from employment.”
RBC received a Disability Certificate dated December 19, 2003, prepared by Dr. Liang, Ms. Sekhon’s family doctor. The Disability Certificate indicates that the date of Dr. Liang’s most recent examination is December 8, 2003. Dr. Liang gave the opinion in this Disability Certificate that Ms. Sekhon was unable to perform the essential tasks of her employment for an anticipated duration of more than 12 weeks.
On February 3, 2004, RBC received an Employer’s Confirmation of Income prepared by the Grand Erie District School Board. The Employer’s Confirmation states that Ms. Sekhon was employed by the Board from October 9, 2002, to present and ongoing.
On March 23, 2004, RBC sent Ms. Sekhon a letter, another OCF-9 and a Notice of Stoppage of Weekly Benefits.
At that time, RBC paid IRBs up to September 23, 2003. The letter, Notice of Stoppage and OCF-9 indicated that IRBs were being terminated, effective September 23, 2003, based on information received from Ms. Sekhon’s employer that she had returned to work on September 24, 2003.
RBC’s letter of March 23, 2004 stated: “If you contest our decision to terminate your Income Replacement Benefits, you must complete the enclosed OCF-17, indicating that you require an assessment at a Designated Assessment Centre and the enclosed OCF-3 Disability Certificate and return these forms to us by April 12th 2004. These forms are needed for the Designated Assessment Centre to accept a referral to assess you.”
Ms. Sekhon’s counsel returned the completed OCF-17 under cover of letter dated April 5, 2004. The letter stated: “I understand that Dr. Liang or Dr. Burger will present the OCF‑3...”
RBC sent the Applicant a further OCF-9, dated April 16, 2004, acknowledging receipt of the OCF-17 and telling her that it had still not received the OCF-3 that is required to proceed with the DAC.
RBC did not get another OCF-3 until it got one from Dr. Liang, dated January 10, 2008.
The DAC was never arranged.
The application for mediation that led to this arbitration was filed more than 2 years after RBC delivered the Notice of Stoppage dated March 23, 2004.

ANALYSIS

It is well established that, for an insurer to take advantage of the 2-year limitation period set out in section 281.1 of the Act and section 51(1) of the Schedule, there must be a valid termination of the disputed benefits. Section 37(3.3) of the Schedule precludes an insurer from stopping payment of IRBs, where an insured person properly requests a DAC, after being given Notice of Stoppage.

Ms. Sekhon’s position is that there was no valid termination because RBC was required to arrange a DAC and failed to do so. RBC argues that the DAC was not arranged because Ms. Sekhon breached her obligation to provide a Disability Certificate. The parties’ rights and obligations in these circumstances are prescribed by section 37(3)2 and (3)3 of the Schedule, which states as follows:

The notice under clause (1)(b) shall inform the person that he or she has the right to require a designated assessment in accordance with section 43 by giving the insurer written notice and a disability certificate from a health practitioner under section 34, before the date specified in the notice under subsection (2).
Despite subsection (2), the insurer shall not stop payment of the benefit if, within 14 days after receiving the notice under clause (1)(b), the person gives the insurer written notice that he or she requires a designated assessment in accordance with section 43 and provides the disability certificate referred to in paragraph 2.

The question is whether Ms. Sekhon was required to provide another Disability Certificate when she returned the OCF-17 requesting a DAC. I find that she had already complied with her obligation to provide a Disability Certificate and was not required to provide another one.

In order to trigger RBC’s obligation to arrange a DAC, Ms. Sekhon was required by section 37(3.2) to return the executed OCF-17 and provide a Disability Certificate “under section 34”. Assessing Ms. Sekhon’s obligations requires a functional interpretation of section 34 in the context of the DAC requirements of section 37. Section 34 required Ms. Sekhon to provide a Disability Certificate “as often as reasonably necessary”. In order to satisfy the DAC function, she was required to provide a Disability Certificate expressing an opinion on her impairment at the date of termination. Neither section 34 nor section 37 required her to provide a new or updated Disability Certificate.

Ms. Sekhon provided a Disability Certificate expressing the opinion that she was unable to engage in the essential tasks of her employment, beyond the date of termination. Dr. Liang’s opinion was that Ms. Sekhon would be disabled from employment for more than 12 weeks, commencing December 8, 2003. Twelve weeks ended on March 2, 2004. RBC received the Employer’s Confirmation on February 3, 2004. On March 23, 2004, RBC terminated IRBs, effective September 23, 2003.

Ms. Sekhon had provided RBC with a Disability Certificate expressing the opinion on her disability beyond the date of termination and up to the date on which RBC was in receipt of all of the information on which it decided to terminate IRBs. A functional interpretation of the obligations imposed by sections 34 and 37 requires a finding that Ms. Sekhon had already complied with her duty to provide a Disability Certificate, when RBC decided to terminate IRBs. A further Disability Certificate was not reasonably necessary. RBC’s approach would suggest that a new Disability Certificate is required, expressing an opinion on disability up to the date on which the DAC is conducted.

The DAC Guideline stated that “in order to assess the need to continue paying weekly benefits, insurance companies are entitled to ask claimants to provide an up-to-date Disability Certificate (OCF-3/59) from their treating practitioner...”.² The Superintendent issued the Guideline pursuant to the power conferred by section 268.3(1) of the Act to “issue guidelines on the interpretation and operation of the Statutory Accident Benefits Schedule or any provision of that Schedule.” The power of the Superintendent does not include imposing obligations that the Schedule does not require.

Section 268(2) of the Act states that the Guideline must be considered in interpreting the Schedule. I see no inconsistency between my interpretation of the Schedule and the Guideline in the circumstances under which RBC terminated Ms. Sekhon’s IRBs. The Disability Certificate expressed the opinion that Ms. Sekhon was unable to engage in the essential tasks of her employment on the date of termination and on the date at which RBC was in possession of the Employer’s Confirmation of Income. Ms. Sekhon had therefore provided RBC with a Disability Certificate that was up-to-date at the time it had all the information upon which it based its decision to terminate IRBs.

RBC’s decision to rely on information it had received that Ms. Sekhon had returned to work does not expand Ms. Sekhon’s obligations. RBC chose not to accept Dr. Liang’s opinion. Ms. Sekhon did not have an obligation to provide RBC with a Disability Certificate containing an opinion that RBC accepts.

Similarly, the promise of a further Disability Certificate by Ms. Sekhon’s counsel does not expand Ms. Sekhon’s obligations under sections 34 and 37. The promise was made in response to a demand for a Disability Certificate to which RBC was not entitled.

In conclusion, because RBC did not arrange a DAC, although Ms. Sekhon complied with all of her obligations in requesting a DAC, there was no valid termination of her IRBs. Ms. Sekhon is therefore not precluded from proceeding to arbitration of her claim for IRBs.

EXPENSES:

The parties made no submissions on expenses. There was nothing about this hearing that puts me in a better position to determine the issue than the hearing arbitrator. I therefore reserve the issue to the hearing Arbitrator. However, should the parties resolve the matter without a hearing but are unable to resolve the issue of expenses, either party may make an appointment for me to determine the matter in accordance with Rules 75 to 79 of the Dispute Resolution Practice Code.

March 29, 2010

Jeffrey Rogers Arbitrator

Date