Financial Services Commission des
Commission services financiers
of Ontario de l’Ontario
Neutral Citation: 2015 ONFSCDRS 245
FSCO A12-000482
BETWEEN:
ASHFAQ KHAN
Applicant
and
THE DOMINON OF CANADA
GENERAL INSURANCE COMPANY
Insurer
FSCO A12-000483
BETWEEN:
NAZIA YOUSAF
Applicant
and
THE DOMINION OF CANADA
GENERAL INSURANCE COMPANY
Insurer
REASONS FOR DECISION ON A MOTION
Before: Stuart J. Mutch
Heard: By way of written submissions
Appearances: Ms. Samia Alam for Mr. Khan
Mr. Michael Kelly/Ms. Sabrina Singh for Ms. Yousaf
Mr. Michael Nicolis for the Dominion of Canada General Insurance Company
Issues:
The Applicants, Ashfaz Khan and Nazia Yousaf, were injured in a motor vehicle accident that took place on March 14, 2008. Disputes arose between Mr. Khan and Ms. Yousaf (“the Applicants”) and their insurer, the Dominion of Canada General Insurance Company (“Dominion”), concerning their entitlement to accident benefits payable under the Schedule1 (“the 1996 Schedule”) and the Applicants applied for arbitration at the Financial Services Commission of Ontario (“FSCO”) under the Insurance Act.2
The arbitration hearing is scheduled to commence in January 2016.
The Applicants have filed a motion requesting an interim Order for funding of the catastrophic (“CAT”) assessment rebuttal reports, dated November 17, 2004 (“the assessments”) for both Applicants in the amount of $26,352.00 each and their expenses of the motion.
I frame the issues in this motion as follows, taking into consideration the parties’ respective descriptions of the issues:
Is either of the Applicants entitled to interim benefits or interim expenses pursuant to subsection 279(4.1) or subsection 282(1.1) of the Insurance Act?
Should the Applicants be permitted to have the reports entered into evidence, in their entirety, at the arbitration hearing?
Are the Applicants entitled to their expenses of the motion?
Result:
The Applicants are not entitled to interim benefits or interim expenses.
The question of whether or which of the assessments dated November 17, 2014 should be admitted into evidence at the arbitration is best left to the hearing arbitrator.
There is no Order as to expenses at this time.
Are the Applicants entitled to interim benefits or interim expenses?
Background
On July 9, 2012 an OCF-18 treatment plan for CAT impairment determination evaluations, completed by West Side Diagnostics in the amount of $26,352.00 and an OCF-19, completed by Dr. Nguyen, chiropractor, was submitted to Dominion, presumably for both Applicants.
Dominion denied the OCF-18 and arranged for a CAT assessment for both of the Applicants. The report of North York Rehabilitation Centre, dated January 3, 2013, regarding Mr. Khan, found him to be not catastrophically impaired.3 The report contained assessments by an orthopaedic surgeon, a psychologist and an occupational therapist, as well as a Dr. Platnick who described himself as physician. I assume a similar assessment was done of Ms. Yousef with the same result. I was not provided with a copy of that report.
On November 6, 2013, a pre-hearing discussion for both Applicants was held. In my pre-hearing letter I recorded the following:
The parties agreed to the following: Mr. Khan (and Ms. Yousef) will submit an OCF 18 for a rebuttal CAT assessment by the following specialists (to reflect the CAT assessment undertaken by Dominion):
· A general practitioner
· An Orthopedic specialist
· A psychologist or psychiatrist
· An occupational therapist
The cost of each assessment shall not exceed $2,000. Dominion shall pay the cost of each assessment upon receipt of the report and invoice of the assessor.
Dominion has taken the position that this agreement amounted to an Order. I disagree. Were it to be an Order, I would have described it as such. I could hardly order that the cost of an assessment be limited to $2,000. The agreement might have been better worded to state that Dominion was not liable to pay more than $2,000 per assessment, which I believe reflects the parties’ understanding and which binds the parties as between themselves.
A rebuttal multi-disciplinary CAT determination rebuttal report for both parties was produced by West Side Diagnostic Centre on November 17, 2014 and served on Dominion the same day. In addition to the medical specialists listed above, the Applicants were evaluated by a neurologist, a dentist (a TMJ evaluation) and a chiropractor (functional abilities evaluation). I will refer to these as “the additional assessments”. An OCF-18 for CAT determination evaluations dated November 25, 2014, in the amount of $26,352.00 per Applicant was submitted a week later. Dominion alleges this was identical to the OCF-18 dated July 9, 2012, mentioned earlier.
Dominion partially approved this treatment plan in the amount of $8,000.00 per Applicant, in accordance with the agreement described above and the monetary limits set out in subsection 25(5) of the 2010 Schedule .4
The Applicants seek an interim order for funding of the catastrophic impairment reports over and above the $8,000 per Applicant. They characterize their request as a request for either interim benefits or interim expenses. They argue that the limits set out in section 25 of the 2010 Schedule do not apply as the Applicants’ accident took place under the 1996 Schedule and their rights vested at that time.
Subsection 279(4.1) of the Insurance Act gives arbitrators the discretionary authority to make interim orders pending the final order in any matter. Subsection 282(11.1) gives arbitrators the specific authority to order interim expenses at any stage of the proceeding, subject to terms and conditions.
Interim Benefits or Interim Expenses?
The Applicants submit that I should apply a two-part test in considering whether the Applicants are entitled to interim expenses and consider whether they have demonstrated a prima facie case of entitlement and necessity or urgency.
To my mind, this a test better suited to consideration of interim benefits. It does not fit a request for interim expenses, which is in fact what the Applicants are claiming in this motion.
From a practical point of view, I must consider whether in fact I have the authority to order interim expenses over and above what Dominion has already agreed to pay.
The old or the new?
The Applicants argue that they are not subject to the funding limits set out in subsection 25(5) of the 2010 Schedule, as the accident occurred prior to the enactment of that Schedule. They argue that their rights crystallized at the time of the accident under the 1996 Schedule, which specifically provided for rebuttal reports and placed no specific limitation on their cost. They cite the cases5 of Dikranian v. Quebec (AG), R.J. and Dominion of Canada General Insurance Co., and Fernandes and Western Assurance Co.in support of their position.
I agree with the view that rights under a contract of insurance crystallize at the time of the accident. I also agree with the general principle that there is a presumption against interference with vested rights.
However, these rights can be superseded by legislation. Subsection 2(2) of the 2010 Schedule states: “Subsections 25(1), (3), (4), (5)…apply with such modifications as are necessary in respect of benefits (emphasis added) provided under the Old Regulation with respect to accidents that occurred on or after November 1, 1996 and before September 1, 2010…”
The reasoning of the Director’s Delegate in Cook and RBC General Insurance Company6 could suggest that the restrictions in subsection 25(5) do not apply to assessments related to catastrophic impairment. In Cook the Director’s Delegate noted that the wording of subsection 18(5) applies to “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” (emphasis added). The Director’s Delegate reasoned that the question of catastrophic impairment is a threshold question and not a question of entitlement to a benefit or payment (although a benefit may or may not flow from the determination of CAT) and therefore the monetary restrictions of subsection 18(5) do not apply.
The same reasoning could be applied to catastrophic reports under subsection 25(5), that they are assessments linked to a threshold question and not in respect to a benefit as referred to in subsection 2(2) above.
I find that the Applicants’ claim for funding falls under the 1996 Schedule. I therefore must consider the provisions of s. 42.1 which does not set monetary limits on CAT rebuttal reports. It does, however, restrict an insurer’s funding obligation to “the portions of the report of the examination under section 42, with which the insured person does not agree and that are relevant to the denial of the claim or application”. That effectively removes from consideration the additional reports presented by the Applicants.
That leaves the four reports that were labelled rebuttal reports at the pre-hearing.
Dominion has raised the requirement that rebuttal reports be served within 80 business days of the completion of the original reports. In my view, they are estopped from making this argument, having agreed to fund rebuttal reports long after that deadline passed.
Da Capo – or, back to the beginning
This is a motion for interim expenses.
The criteria for the awarding of interim expenses is set out in Bernicky and Guardian Insurance Company of Canada.7 I am not satisfied that the expenses sought are reasonable and necessary for the conduct of the arbitration, as required by Bernicky. As stated earlier the Applicants have obtained and served the reports and have an ample battery of evidence to respond to Dominion’s position at the hearing. Four of them will be partially paid for. The hearing arbitrator will be in a better position to consider whether the additional assessments are reasonable and necessary and whether Dominion should be liable for some or all of their costs.
Accordingly, the Applicant’s motion for interim benefits and interim expenses is dismissed.
Should the Applicants have their catastrophic rebuttal reports admitted in their entirety at the arbitration hearing?
It is a fundamental principle of natural justice that a party has an opportunity to respond to the position taken against it.
The evidence provided indicates that the reports were served on Dominion on November 17, 2014, the same day they were completed and well in advance of the scheduled hearing. I am not convinced, at this point, that there is anything preventing the Applicants from submitting the reports in evidence at the arbitration hearing. Any question relating to the admission of evidence at the hearing is best left to the hearing arbitrator.
EXPENSES:
When assessing expenses, arbitrators at FSCO determine entitlement and quantum by applying criteria dictated by the legislation.8
While Dominion has ultimately been the successful party in this motion, I do not believe this is an appropriate case for an expense award. The hearing arbitrator may take into account this motion when making an order as to expenses.
November 17, 2015
Stuart J. Mutch
Arbitrator
Date
Financial Services Commission des
Commission services financiers
of Ontario de l’Ontario
Neutral Citation: 2015 ONFSCDRS 245
FSCO A12-000482
BETWEEN:
ASHFAQ KHAN
Applicant
and
THE DOMINION OF CANADA
GENERAL INSURANCE COMPANY
Insurer
FSCO A12-000483
BETWEEN:
NAZIA YOUSAF
Applicant
and
THE DOMINION OF CANADA
GENERAL INSURANCE COMPANY
Insurer
ARBITRATION ORDER
Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
The Applicants’ motion for interim benefits and interim expenses is dismissed.
There is no Order as to the admission of evidence at the hearing.
There is no Order as to expenses.
November 17, 2015
Stuart J. Mutch
Arbitrator
Date
Footnotes
- The Statutory Accident Benefits Schedule — Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.
- R.S.O. 1990, c.I.8, as amended.
- Mr. Khan’s Motion Record, Tab 33
- The Statutory Accident Benefits Schedule — Effective September 1, 2010, Ontario Regulation 34/10, as amended.
- 2005 SCC 73, [2005] S.C.J. No. 75, (FSCO A12-001235, September 17, 2013), (FSCO A13-001614, September 30, 2014)
- Cook and RBC General Insurance Company (FSCO P14-00038, May 4, 2015)
- (OIC A-006268, July 6, 1994)
- Under subsection 282(11) of the Insurance Act, R.S.O. 1990, c.I.8, as amended, an arbitrator may award expenses to either party according to criteria prescribed in subsection 12(2) of the Expense Regulation, R.R.O. 1990, Regulation 664.