Neutral Citation: 2014 ONFSCDRS 152 FSCO A13-015449

BETWEEN:

JOHN COOK Applicant

and

RBC GENERAL INSURANCE COMPANY Insurer

DECISION ON A MOTION

Before: Stuart J. Mutch Heard: August 7, 2014 Appearances: Ms. Samia Alam for Mr. Cook Ms. Anju Sharma for RBC

Overview:

The Applicant, John Cook, was injured in a motor vehicle accident that took place on March 4, 2011. Disputes arose between Mr. Cook and his insurer, RBC General Insurance Company (“RBC”), concerning his entitlement to accident benefits payable under the Schedule¹ and Mr. Cook applied for arbitration at the Financial Services Commission of Ontario (“FSCO”) under the Insurance Act.²

The arbitration hearing is scheduled to commence March 9, 2015.

Mr. Cook filed a motion requesting an interim Order for funding of catastrophic (“CAT”) impairment reports in the amount of $12,960.00 and his expenses of the motion.

Issues

The issues in this motion are:

Should RBC be required to pay all or a part of the costs of a catastrophic impairment assessment?
Should RBC pay some or all of Mr. Cook’s expenses of this motion?

Result:

RBC is not required to pay all or part of the costs of a catastrophic impairment assessment. The Applicant’s motion for an interim order is dismissed.
There is no order as to expenses.

Background

Mr. Cook is 53 years of age. At the time of the accident he lived by himself and was employed as a truck mechanic, a trade he practiced most of his working life. He was involved in a motor vehicle accident on March 4, 2011, when a young woman crossed the road in front of his car and he struck her. She died as a result of her injuries. Mr. Cook claimed and received accident benefits, including income replacement benefits, which were terminated in December 2013.

In January 2013, Mr. Cook submitted an OCF-18 treatment plan dated January 10, 2013 for a catastrophic impairment determination evaluation, the expense of which was broken down as follows:

a. Psychological assessment by Dr. Jacques Gouws $ 2,000 b. Neurological assessment by Dr. Michael Rathbone 2,000 c. Occupational Therapy Assessment by Lesya Dyk 2,000 d. File Review and Summary by Dr. Roberta Koch 2,000 e. Essential Clinical Tasks 1,800 f. Collating Assessors Reports 1,800 g. HST on all approved Treatment Plans 1,360

TOTAL $ 12,960

In a letter dated January 14, 2013, RBC denied this treatment plan on the basis that it was not reasonable and necessary as Mr. Cook had not completed and submitted an OCF-19, which is an application for determination of a catastrophic impairment. The writer of the letter also noted that such an application cannot be submitted until two years have elapsed since the accident, as required by subsection 3(2)(5)(b). At that point, RBC had not paid out the $50,000 maximum in medical and rehabilitation benefits as set out in subsection 18(3) of the Schedule.

On July 24, 2013, Mr. Cook’s family doctor submitted an OCF-19. RBC arranged for CIRA Medical to conduct a CAT insurer assessment which it did in November 2013 at the alleged cost of $15,280. The assessment found Mr. Cook to have a 7% Whole Person Impairment and a mild level of impairment in all four spheres of functioning. The conclusion was that he is not catastrophically impaired. Mr. Cook seeks funding for what could be termed to be a second opinion or rebuttal CAT assessment. RBC takes the position that it would be unreasonable to require it to pay for Mr. Cook’s CAT assessment for the following reasons:

It has paid out the maximum in medical and rehabilitation benefits required under section 18 of the Schedule
Mr. Cook has the financial means to pay for the assessment

Analysis:

i) Is Mr. Cook seeking an interim benefit or interim expense?

There is no question that an arbitrator can make an interim order, pending a final order, pursuant to section 279 of the Insurance Act and section 67 of the Dispute Resolution Practice Code. One of the issues in this motion is whether Mr. Cook is seeking payment of a benefit or payment of an expense.

According to subsection 18(5) of the Schedule, “medical and rehabilitation benefits payable in respect of an insured person include all fees and expenses for conducting assessments and examinations and preparing reports in connection with any benefit or payment to or for an insured person under this Regulation.” Therefore, Mr. Cook’s request might properly be considered part of the package of benefits outlined in the Schedule. This issue has arisen because RBC characterizes Mr. Cook’s request as a benefit. It argues that it has paid out the maximum of $50,000 in medical and rehabilitation benefits and cannot be compelled to pay more.

I have considered the guiding principles for the awarding of an interim benefit, as set out in Ioannidis and Canadian General Insurance Group³, as well as Singh and Coseco Insurance Co.⁴, Henry and Aviva Canada Inc.⁵, and Nguyen and State Farm Mutual Automobile Insurance Company.⁶ In doing so, it becomes obvious that the factors to be considered in awarding interim benefits are ill-suited to the consideration of a request such as the one made in this motion. Mr. Cook’s request is for a one-time payment. It is not for ongoing relief from financial deprivation, as would be the case in a request for interim income replacement benefits, or for ongoing payment for personal assistance, such as for interim attendant care or housekeeping benefits. Its objective is to provide Mr. Cook with sufficient evidence to rebut the RBC CAT assessment. Mr. Cook alleges he does not have the financial resources to pay for such an assessment.

I find that the funding of a rebuttal CAT assessment is most properly characterized as an expense.

ii) Should this interim expense be awarded?

The leading case in determining whether interim expenses ought to be awarded is Bernicky and Guardian Insurance Company of Canada.⁷ In Bernicky, the applicant was seeking the costs of clinical notes and records and a medical-legal report. Although the costs claimed were much less than those claimed by Mr. Cook, Mr. Bernicky, like Mr. Cook, took the position that these costs were essential for the conduct of the arbitration. The arbitrator in Bernicky set out the following criteria for the awarding of interim expenses, which I consider useful:

The application must raise a bona fide issue;
The expenses sought are reasonable and necessary for the conduct of the arbitration; and
The applicant is unable to carry the expenses of the arbitration.

Does the Application raise a bona fide issue?

From reading the documentation filed, it appears that the chief issue in this arbitration is whether Mr. Cook has sustained a catastrophic impairment. RBC has obtained a CAT assessment dated November 27, 2013, which, as stated above, found Mr. Cook not catastrophically impaired. Mr. Cook has obtained two reports indicating that he suffers significant psychological distress. Dr. Gozlan, psychologist, wrote a report dated June 18, 2011, wherein he found Mr. Cook to suffer from moderate anxiety and depression and severe post-traumatic stress disorder. The report of Dr. Waldenberg, psychiatrist, dated June 30, 2014, indicates that Mr. Cook is severely depressed and incapable of working in any capacity. Like Dr. Gozlan, he believes that Mr. Cook suffers from post-traumatic stress disorder.

Given the breadth of opinion as to Mr. Cook’s psychological state and degree of impairment, there is no question in my mind that there is a bona fide issue as to whether Mr. Cook is or is not catastrophically impaired.

Are the expenses sought reasonable and necessary for the conduct of the arbitration?

Mr. Cook takes the position that he requires funding of what amounts to a rebuttal of RBC’s CAT assessment.

It goes without saying that a party has the right to be able to respond appropriately to the position taken against it.

The question here is whether the reports of Drs. Gozlan and Waldenberg are sufficient to provide support for Mr. Cook’s position that he is catastrophically impaired to the degree that ensures a level playing field at the arbitration.

CAT assessments tend to be multi-disciplinary. As Arbitrator Wilson stated in R.J. and Dominion of Canada General Insurance Company⁸, “They are complex, multiple reports often by different assessors. A rebuttal report necessarily takes on the complexity of the report whose findings it addresses.” The RBC CAT report included assessments by a physiatrist, an orthopaedic surgeon, a neurologist, a psychiatrist and an occupational therapist.

It appears that Mr. Cook’s primary area of impairment is in the psychological sphere. There are no allegations of significant physical injury or impairment. In this situation, is such a thorough work up required?

Dr. Gozlan’s assessment was performed in June 2011, almost two and one-half years before RBC’s CAT assessment. To my mind it is of little value in providing an alternative view point to the RBC CAT assessment.

Dr. Waldenberg’s report is more up to date. He does opine on Mr. Cook’s cognitive ability and his functional ability.

Whether someone is catastrophically impaired is ultimately a legal question. However, unlike RBC’s CAT assessment, Dr. Waldenberg does not lend an opinion as to Mr. Cook’s level of impairment with regard to the components of catastrophic impairment as set out in subparagraphs 3(2)(e) and 3(2)(f) of the Schedule.

In my view, in light of the divergent opinions of RBC’s CAT assessors and Dr. Waldenberg, the costs of a second CAT assessment, one that is approximately as thorough as the first, is a reasonable and necessary expense for the conduct of the arbitration hearing.

Is the Applicant, Mr. Cook, unable to carry the expenses of the arbitration?

In the motion before me, Mr. Cook is asking only for the expense of the rebuttal assessment, which he estimates to be $12,960.

Prior to the accident, Mr. Cook worked as a mechanic. He has not been employed since the accident. He received income replacement benefits in the amount of $400.00 week until December 2013. In his affidavit, marked as Exhibit “1”, Mr. Cook indicated that in January 2014 he was facing eviction as he could not make his rent payments. He obtained a loan from Rhino Legal Finance Inc. He began receiving social assistance in February 2014, in the amount of $626.00 per month. In June 2014, he was approved for a CPP disability pension. The affidavit of Paul Barrafato, marked as Exhibit “2”, indicates that Mr. Cook went to live with his sister in February 2014, presumably because he was financially compelled to do so. Presently, Mr. Cook has a total monthly income of approximately $1,200.

There were submissions made that Mr. Cook recently received $19,000 in back payments from the Ontario Disability Support Program. At the same time, there was also an indication that a loan statement of $16,000 was recently sent to a collection agency. I can find no documentary substantiation for this in the voluminous material filed by the parties.

I find that Mr. Cook has extremely limited financial resources and that he is not in the position to fund the full cost of the proposed assessment.

Conclusion

Were there no other considerations, I would order RBC to pay at least some of the claimed expense.

However subsection 18(3) of the Schedule states:

18(3) The sum of the medical and rehabilitation benefits paid in respect of an insured person who is not subject to the financial limit in subsection (1) shall not exceed, for any one accident,

(a) $50,000; or

(b) if the insured person sustained a catastrophic impairment as a result of the accident, $1,000,000. O. Reg. 34/10, s. 18 (3).

It is uncontested that RBC has paid over $50,000 in medical and rehabilitation benefits to Mr. Cook. Section 18(5) places Mr. Cook’s claim into that category, by a legislative clause that is clearly meant to limit insurer liability for the cost of both treatment and assessments in non-catastrophic cases. In doing so, the Legislature did not provide for situations such as Mr. Cook’s, where the very question of whether he can claim more than the $50,000 in medical and rehabilitation benefits hangs in the balance. A voluntary payment by RBC of a sum towards the cost of Mr. Cook’s rebuttal CAT assessment would help to banish the state of inertia in which this matter presently stands. In my view, it goes against the remedial nature of this legislative scheme to leave matters at a standstill.

However, while I have found this to be a situation where an award of interim expenses is warranted, I am prevented from doing so by subsection 18(3) of the Schedule. To order otherwise would be to defy the legislated limits set out in subsection 18(3). Mr. Cook’s request for an order for the interim payment of an expense is denied.

EXPENSES:

When assessing expenses, arbitrators at FSCO determine entitlement and quantum by applying criteria dictated by the legislation.⁹

While RBC has ultimately been the successful party, I do not believe this is an appropriate case for an expense award. Mr. Cook’s position was reasonable and his arguments compelling. Both parties made persuasive argument and the appropriate conclusion was far from clear at the commencement of this motion.

The parties shall bear their own expenses of this motion.

September 18, 2014

Stuart J. Mutch Arbitrator

Financial Services Commission of Ontario