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

Neutral Citation: 2016 ONFSCDRS 224

FSCO A16-000288

BETWEEN:

STEPHEN ROJAS Applicant

and

COACHMAN INSURANCE COMPANY Insurer

Before: David Snider

Heard: By written submissions

Submissions: Heidi Brown for Mr. Rojas Kerri P. Knudsen for Coachman Insurance Company

Issues:

The Applicant, Stephen Rojas, was injured in a motor vehicle accident on June 16, 2013. He applied for and received statutory accident benefits from Coachman Insurance Company (“Coachman”), payable under the Schedule.¹ A dispute arose, as a preliminary matter, as to whether Stephen Rojas is required to attend certain s.44 examinations and whether he can be deemed to have sustained a catastrophic impairment due to Coachman’s alleged failure to comply with the language of s.45(3) of the Schedule. The parties were unable to resolve their disputes through mediation, and Mr. Rojas applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as it read immediately before being amended by Schedule 3 to the Fighting Fraud and Reducing Automobile Insurance Rates Act, 2014, and Regulation 664, R.R.O. 1990, as amended.

The preliminary issues are:

Is Mr. Rojas required to attend s.44 examinations pertaining to his filing of an Application for Determination of Catastrophic Impairment (OCF-19) dated August 10, 2015 pursuant to s.45 of the Schedule?
Can Mr. Rojas be deemed to have sustained a catastrophic impairment as a result of Coachman’s failure to comply with the time requirements specified in s.45 (3) of the Schedule?

Result:

If Mr. Rojas wishes to pursue his claim for entitlement to catastrophic impairment level benefits he will need to attend the s.44 examinations scheduled by Coachman pertaining to his Application for Determination of Catastrophic Impairment (OCF‑19).
Mr. Rojas cannot be deemed to have sustained a catastrophic impairment by virtue of Coachman’s failure to abide by the time requirement(s) set out in subsection 45(3) of the Schedule.

EVIDENCE AND ANALYSIS:

This matter proceeded entirely by written submissions, including affidavits filed from both sides, and the parties were given extra time over and above the timelines they had agreed upon to finalize the said submissions.

As a brief summary, there is no fundamental disagreement between the parties as to the basic facts; namely, that the Applicant submitted a duly completed Application for Determination of Catastrophic Impairment in August, 2015, and despite repeated follow-up correspondence from the Applicant's counsel, the Insurer failed to respond to the said application not only within the 10 days required period set out in the Schedule for its response, but for some months afterward. When the Insurer did finally respond and arrange the usual set of medical examinations pertaining to this type of determination, the Applicant refused to attend for the examinations on the basis that the Insurer was too late in setting them up and as a consequence claimed that the Applicant should be deemed to have been found catastrophically impaired. The Applicant further asserted that its Catastrophic Impairment Assessment, prepared by Dr. Harold Becker, should now prevail and be sufficient for the deeming of catastrophic impairment for the Applicant.

The Insurer, for its part, acknowledged the tardiness of its response to the Application and began paying catastrophic-level benefits, where applicable, to the Applicant on an interim basis while attempting to complete the assessment process set out in the Schedule by issuing notices of examination to the Applicant.

This resulted in an impasse which has continued for over a year at this point. The Applicant claims, in its affidavit evidence, that the Applicant has been denied a variety of essential medical services during this intervening period. By contrast the Insurer, in its affidavit, asserts that they have been paying all medical treatment plans, inclusive of applicable interest, during the period in dispute as an indication of its good faith in dealing with the Applicant.

THE LAW:

Section 45 of the Schedule clearly sets out the procedure whereby an Applicant can apply for a Determination of Catastrophic Impairment and also the amount of time that the Insurer has to respond to this type of application, namely ten (10) days. I find that the Applicant fully complied with its requirements, but that the Insurer, for somewhat uncertain reasons, failed to adjust the file properly and failed to meet its time limited requirement to respond by setting up the examinations needed to determine the issue of eligibility for catastrophic benefits within the ten days.

The Schedule, however, does not set out what the regulatory consequence is when the Insurer fails to comply with the timeline set out in s.45. This is in clear contrast to the deemed approval regime which exists elsewhere in the Schedule when the Insurer fails to respond in a timely manner to OCF-18 Treatment and Assessment Plans. In those cases, the Insurer is deemed to have approved the goods and services set out in the OCF-18s if it misses the response time requirements.

The Applicant asserts, for basically consumer protection reasons, that I should "read in" a similar consequence in this case.

The court addressed this exact issue in Gray v. Pilot Insurance Company, 2006 CanLII 22118 (ON S.C.) Justice Lederman stated the following at paragraph 40,

"... the SABS does not mandate that every failure to meet a timeline set out under sections 40 & 43 results automatically in the deeming of the claimant as catastrophically impaired."

Further, in Mileevshy v. General Accident Assurance Co. of Canada, [2000] O.F.S.C. I.D. No. 103 (F.S.C.O.) the wording set out is,

"The SABS is silent as to the consequences of missing timelines set out therein. There is nothing in the Schedule to suggest that failure to adhere to the 30 day period, for example, results in a claimant being deemed to be catastrophically impaired."

Accordingly, as both of these decisions are directly on point I find that the consequence sought by the Applicant herein, namely a deeming of catastrophic impairment in this fact situation, is not available under the Schedule. The only consequences which appear to be of a general nature for purposes of the Schedule are the requirement for an Insurer to pay specified interest on late paid items and/or the ability of an Applicant to apply for a Special Award in Arbitration where the behaviour of an Insurer falls below acceptable levels. Both of those consequences are open and available to the Applicant to argue herein in the hearing to follow this preliminary decision.

I can, within my appointed mandate, only interpret the actual words of the Schedule. Following the consumer protection purpose(s) of the Schedule, which has been found and applied many times by arbitrators, is entirely appropriate in the proper circumstances but it frankly does not apply here. In Galati and Aviva Canada (FSCO A04-001256) 2005, Arbitrator Feldman, dealing with a similar lack of consequence pertaining to section 49 of the Schedule stated,

"In my view, it would require my reading into the Schedule a remedy for a breach of section 49 that is not expressly granted therein. The purpose of the Commission (and, in fact, of any quasi-judicial tribunal) is to interpret the relevant legislation, not to write new provisions into that legislation."

While the Schedule is a regulation, not legislation per se, I see no fault with this reasoning and I feel it is entirely appropriate to apply in this case. It seems unequivocal, then, that I do not have the authority to create and insert new words and consequences into the Schedule by arbitral decision.

This, in my opinion, decides the issue. The best course for the Applicant is to attend all examinations pursuant to s.44 of the Schedule which the Insurer can reasonably request to determine whether he meets the requirement(s) to be found catastrophically impaired. If the Applicant's own assessment, as provided by Dr. Becker, does not prevail over the results obtained by the Insurer through the s.44 assessment process, then there will be further regulatory procedures available to the Applicant to pursue his claim.

EXPENSES:

I leave the question of expenses to be awarded in this matter to the hearing arbitrator. If the parties determine that this preliminary decision has finalized the arbitration process for purposes of this Application for Arbitration and if they cannot determine their expenses herein by themselves they may arrange for an expense hearing before me in the usual manner.

August 25, 2016

Arbitrator

Date