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

Neutral Citation: 2015 ONFSCDRS 248 FSCO A14-005530

BETWEEN:

CLARENCE DELA CRUZ Applicant

and

TD HOME AND AUTO INSURANCE COMPANY Insurer

DECISION ON A MOTION

Before: Arbitrator Lynda Tanaka

Heard: In person at ADR Chambers on September 11, 2015

Appearances: Mr. Clarence Dela Cruz did not participate Mr. Muhammad M. Alam participated for Mr. Clarence Dela Cruz Mr. Rabjeet Wallia participated for TD Home and Auto Insurance Company

Issues:

The Applicant, Mr. Clarence Dela Cruz, was injured in a motor vehicle accident on January 1, 2012 and sought accident benefits from TD Home and Auto Insurance Company (“TD Home”), payable under the Schedule.¹ The parties were unable to resolve their disputes through mediation, and the Applicant, through his representative, applied for arbitration at the Financial Services Commission of Ontario (“FSCO”) under the Insurance Act, R.S.O. 1990, c. I.8, as amended.

This decision arises from a Motion by TD Home for an Order dismissing the Application for Arbitration filed July 2, 2014 with FSCO, and costs of the Motion on the basis that the Applicant failed to attend any Insurer’s Examinations, though properly served with notice and without reasonable rationale or grounds for his refusal to attend, pursuant to s. 44 of the Schedule.

The issues in this Motion are:

1. Should the Application for Arbitration filed July 2, 2014 be dismissed?
2. Should expenses and disbursements of the Motion be awarded to the successful party on this Motion?

Result:

1. The Application for Arbitration is dismissed.
2. In the event that the parties are unable to resolve the issue of expenses and disbursements, the Applicant shall serve and file with ADR Chambers his written submissions on the request for costs by TD Home within 20 days of the release of this decision. TD Home shall file its reply to those submissions with ADR Chambers within 10 days of receipt of the Applicant’s submissions.

EVIDENCE AND ANALYSIS:

Legislation

Section 44 of the Schedule provides as follows:

(1) For the purposes of assisting an insurer to determine if an insured person is or continues to be entitled to a benefit under this Regulation for which an application is made, but not more often than is reasonably necessary, an insurer may require an insured person to be examined under this section by one or more persons chosen by the insurer who are regulated health professionals or who have expertise in vocational rehabilitation.

Section 55 of the Schedule provides as follows:

An insured person shall not commence a mediation proceeding under section 280 of the Act if any of the following circumstances exist…

Paragraph 2 of Section 55 of the Schedule provides this circumstance for limiting the insured person’s right:

The insurer has provided the insured person with notice in accordance with this Regulation that it requires an examination under section 44, but the insured person has not complied with that section.

Decision

TD Home filed a Motion Record including an affidavit of J. Jason M. Kerr, sworn August 19, 2015, with 21 exhibits attached (“Kerr affidavit”). The Kerr affidavit was marked Exhibit 1 on this Motion. A factum was also included in the Motion Record with the Notice of Motion, and a book of authorities was provided. No material was filed by the Applicant.

The Application for Arbitration involves claims for Attendant Care Benefits and for costs of four examinations, specifically an In-Home Assessment, a Functional Abilities Evaluation (“FAE”), a Psychological Assessment, and an Orthopaedic Assessment.

As noted in paragraph 8 of the Kerr affidavit, the injuries that the Applicant suffered are described in an OCF-3, dated January 6, 2011 (Exhibit B), as dislocation, sprain and strain of various joints and ligaments in the shoulders, neck and back, and strain and sprain of two portions of the spine, and cervical disc disorder and radiculopathy in the cervical region.

It is agreed that TD Home paid some benefits to the Applicant and denied others. The details of the filing of the disputed claims for costs of examination and Attendant Care Benefits, as well as other claims, are set out in the Kerr affidavit. Statements of benefits paid were sent to the Applicant in February, April and May 2012 and in each case the Applicant was advised that the Minor Injury Guideline applied.²

The original requests for benefits which are the subject of the Application for Arbitration as costs of examination are described in paragraphs 13 and 18 to 20 of the Kerr affidavit. Two were submitted in September 2012, the third in October 2012 and the fourth in May 2013. The evidence is that each one was rejected on the basis that the Applicant’s injuries fall within the Minor Injury Guideline.³

On December 16, 2013, TD Home advised the Applicant that an Insurer’s Examination would be required to assess if the Applicant suffered a minor injury. The correspondence setting up the request for Insurer’s Examinations in January and February 2014 is described in paragraphs 21 and 22 of the Kerr affidavit. The Applicant’s counsel advised TD Home that the Applicant would not attend “as these examinations are a waste of Insurer’s [sic] fund and can be conducted by paper review”.⁴

In June 2014, TD Home tried again to obtain Insurer’s Examinations and on July 3, 2014, Applicant’s Counsel again disagreed with the necessity of in person examinations and insisted on a paper review alone.⁵ TD Home’s response is Exhibit T of the Kerr Affidavit and, in it, TD Home states that the Applicant is not entitled to the goods and services of the disputed treatment plan because of failure to attend the Insurer’s Examinations. The letter also includes the following paragraph:

Should you wish to attend and participate, we would be pleased to have the Examinations required by insurer [sic] rescheduled. Please contact Centric Health directly…to provide dates and times you are available and accommodations will be made to secure a new appointment.

On July 9, 2014, Applicant’s Counsel advised that the Applicant would attend an Insurer’s Psychological Examination but not at the date scheduled (July 14, 2014). The Applicant continued to refuse to attend one of the examinations, the orthopaedic assessment, for the same reasons as stated in earlier correspondence.⁶ This letter also includes this paragraph:

…our client will not be able to attend the Psychological Assessment on July 14, 2014, due to a prior commitment. We ask that you kindly re-schedule the assessment any day after 4:30pm (sic)⁷

TD Home moves for dismissal of the Application for Arbitration on the basis of the Applicant’s failure to attend the Insurer’s Examinations as required under s. 44 and s. 55 of the Schedule. The refusal to attend the requested examinations is not disputed by the Applicant despite the clear language in the paragraph above from the July 9, 2014 letter that he would attend at least the Psychological Examination. No explanation was given as to why the Applicant or his counsel did not follow the instructions to contact Centric Health directly as requested in the July 3, 2014 letter quoted above.

The Applicant’s Counsel did not defend the reason given for non-attendance in the refusals sent to TD Home, that is, that the examinations are a waste of money and a paper review should suffice. He submitted on the Motion that the Arbitrator should not dismiss the claim but rather should order the Applicant to attend the Insurer’s Examinations and the Applicant would comply. He indicated that the Arbitrator could direct which of the Insurer’s Examinations would be appropriate and that two only should suffice, rather than the four that he said the Insurer wanted. He disputed the need for an orthopaedic assessment at all. He provided no case law to support the proposition that the Arbitrator could order the Applicant to attend the Insurer’s Examination or could choose which Insurer’s Examination the Applicant should attend. He brought no cross-Motion for such an Order and there was no evidentiary basis for the submission.

The Applicant does not resist this Motion on the grounds that the examinations were sought more often than reasonably necessary. While he argued that four was excessive, there is nothing before me to indicate that TD Home sought four examinations – only two were sought. The Applicant was himself seeking recovery of costs of four assessments.

Nor was there any attack on the qualifications of the assessors proposed. There is no argument that the timing of the examinations would interfere with the processing of the case since the Application for Arbitration was received in June 2014. There is no evidence that there were other Insurer’s Examinations that TD Home could rely on. Indeed TD Home submits that, without these examinations, it would be facing trial by ambush and it had not been able to exercise its right to have the Applicant seen by any assessor of its choice. There is no challenge that the requested examinations (orthopaedic and psychological) are unrelated to the injuries alleged and they mirror the claims for costs of examinations made by the Applicant.

TD Home referred to fourteen cases in support of its position. These cases establish the following propositions:

• The Applicant bears the burden of establishing that he fits within the scope of coverage. (Scarlett and Belair Insurance Company Inc., [2013] O.F.S.C.D. No. 227, para. 6.)

• The purpose of the independent examinations by assessors chosen by the Insurer is to enable the Insurer to fairly and effectively assess a claim for benefits. (F.S. and Belair Insurance Company Inc., [1996] O.I.C.D. No. 92 at para. 28.)

• Denying the Insurer an opportunity to have an independent assessment, even if it is requested on the eve of the Hearing and requires an adjournment, may constitute a denial of the right to make a full response. (Gonsalves and Certas Direct Insurance Company, 2011 ONSC 3986, [2011] O.J. No. 3290 at para. 10.)

• The choice of specialist is that of the Insurer, provided that a reasonable nexus exists between the specialist and the injuries claimed. The scope of the regulation authorizing the examinations is broad and flexible to ensure that an insurance company has an effective opportunity to evaluate the Applicant’s medical condition and reflect the reality of modern interactive medical practice. (Scott and Toronto Transit Commission (Markel Insurance), OIC A-001116, Arbitrator Naylor, September 4, 1992 at page 18.)

• An Insurer can only obtain its own medical opinion by exercising its right to an independent examination. (Augustin and Unifund Assurance Company, [2013] O.F.S.C.D. No. 211 at para. 38.)

• Where the passage of time between the accident and the proposed examinations is substantial, the prejudice to the Insurer to effectively and properly assess the claims cannot be relieved by examinations at a late date. (Zhang and Security National Insurance Co./Monnex Insurance Mgmt. Inc., [2015] O.F.S.C.D. No. 167 at para. 34.)

• An Arbitrator has no authority to compel an insured person to submit to an Insurer’s Examination that an Insurer requested, but clear direction and information on the letter requiring attendance at an independent examination is required before an Arbitrator will conclude that the Applicant has failed to attend. (Quinones and Unifund Assurance Company, [2013] O.F.S.C.D. No. 108 at para. 9.)

• The Applicant must provide a reasonable excuse for not attending the examinations. Lack of an interpreter with specific credentials is not a reasonable excuse. (Luo and Unica Insurance Inc., [2015] O.F.S.C.D. No. 29, Chen and Personal Insurance Company of Canada [2015] O.F.S.C.D. No. 13, Lee and Yau and State Farm Mutual Automobile Insurance Company, [2015] O.F.S.C.D. No. 4550.)

• The language of s. 55 is mandatory with no exceptions. (Maude and State Farm Mutual Automobile Insurance Co., [2014] O.F.S.C.D. No. 210 at para. 12)

This Motion was originally scheduled months ago by the Pre-Hearing Arbitrator and was adjourned at the request of the Applicant from August 31 to September 11, 2015. There can be no complaint that the Applicant did not have time to put together the necessary materials to support an alternative outcome.

TD Home submitted that, given the passage of time since the accident (January 1, 2012), it was unfair to the Insurer to order examinations now. If the conclusion of the assessors was not supportive of the Applicant, the Applicant would argue that those conclusions should be rejected because the examinations took place so long after the accident. In essence, the Applicant is seeking to weaken the potential that the Insurer could effectively respond to his case by the simple tactic of delay. TD Home submits that this is fundamentally unfair and I agree. TD Home has chosen to move for dismissal of the application and not for an order that the Applicant attend the examinations. It is entitled to make that choice of remedy.

The Motion by TD Home for an order dismissing the Application for Arbitration in this matter is supported by the evidence and the case law to which I have been referred. The Motion is granted.

EXPENSES:

At the conclusion of the argument of the Motion, counsel for TD Home provided to Applicant’s Counsel its claim for expenses and disbursements. I indicated that I would reserve the issue of recovery of those expenses and disbursements to be resolved after the determination of the merits of the Motion. Since TD Home has provided its written submissions on costs to the Applicant already, the process of submissions that I order need only address the timing of the submissions of the Applicant and the reply material.

In the event that the parties are unable to resolve the issue of expenses and disbursements, TD Home should provide to ADR Chambers a copy of the submissions on expenses given to the Applicant on the day of the Motion. The Applicant shall serve and file with ADR Chambers his written submissions on the request by TD Home within 20 days of the release of this decision. TD Home shall file its Reply to those submissions with ADR Chambers within 10 days of receipt of the Applicant’s submissions.

November 20, 2015

Lynda Tanaka Arbitrator

Date

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

Neutral Citation: 2015 ONFSCDRS 248 FSCO A14-005530

BETWEEN:

CLARENCE DELA CRUZ Applicant

and

TD HOME AND AUTO 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:

1. The Application for Arbitration is dismissed.
2. In the event that the parties are unable to resolve the issue of expenses and disbursements, the Applicant shall serve and file with ADR Chambers his written submissions on the request for costs by TD Home within 20 days of the release of this decision. TD Home shall file its reply to those submissions with ADR Chambers within 10 days of receipt of the Applicant’s submissions.

November 20, 2015

Lynda Tanaka Arbitrator

Date

Footnotes

1. 1The Statutory Accident Benefits Schedule - Effective September 1, 2010, Ontario Regulation 34/10, as amended.
2. 2Kerr Affidavit, Exhibit 1, paragraphs 14-17, Exhibits F, G and H, footnote 1 on page 2 of each.
3. 3Supra, Exhibits I, J, K and L.
4. 4Supra, paragraphs 21-25, Exhibits M, O, S and U.
5. 5Supra, paragraphs 28 to 29.
6. 6Supra, paragraph 31.
7. 7Supra, Exhibit U.