Colleen Comegna v. Aviva Canada Inc., 2017 ONFSCDRS 228

Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2017 ONFSCDRS 228

Appeal P17-00024

Appellant

and

Respondent

BEFORE:

Delegate Jeffrey Rogers

Ms. Georgiana Masgras, solicitor for Ms. Comegna

Mr. Derek Greenside, solicitor for Aviva

On the record, by written submissions completed on August 8, 2017

Under section 283 of 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, it is ordered that:

The appeal is allowed.
Paragraphs 1 and 3 of the Arbitrator’s order of February 21, 2017 are rescinded.
The issues of Ms. Comegna’s entitlement to Non-Earner Benefits and a special award are remitted for a de novo re-hearing by a different Arbitrator.
The issue of expenses of the hearing before the Arbitrator is remitted for re-hearing, but that issue may be decided by the same Arbitrator.
If the parties are unable to agree about expenses of this appeal, an expense hearing may be arranged in accordance with Rule 79 of the Dispute Resolution Practice Code.

August 24, 2017

Jeffrey Rogers Director’s Delegate

Date

I. NATURE OF THE APPEAL

Ms. Comegna appeals the Arbitrator’s order of February 21, 2017. The Arbitrator ruled that she is precluded from proceeding to arbitration of her claim for Non-Earner Benefits (NEBs) because Aviva gave her a notice under s.44 of the Schedule¹ requiring her to attend an insurer examination and she did not complete the examination. The Arbitrator dismissed the arbitration, since there were no other benefits in dispute. For the reasons that follow, I find that the Arbitrator erred in ruling that Ms. Comegna is precluded from proceeding, without considering her submissions that the proposed examination was not reasonable and necessary and that her conduct was not a failure or refusal to comply. The appeal is therefore allowed and the remaining issues in the arbitration are remitted for re-hearing by a different Arbitrator.

The Arbitrator also awarded Aviva its expenses of the Arbitration, but he did not fix an amount. The result in this appeal changes the result in the arbitration, but Ms. Comegna did not appeal all of the Arbitrator’s rulings against her. The issue of expenses of the hearing before the Arbitrator is therefore remitted for re-hearing but that issue may be decided by the same Arbitrator.

II. BACKGROUND

Ms. Comegna was injured in a motor vehicle accident on February 13, 2014. She applied for and received statutory accident benefits from Aviva. She applied for arbitration after mediation failed to resolve disputes regarding further claimed benefits. The issues that came before the Arbitrator were:

Entitlement to NEBs, starting August 13, 2014
Whether Ms. Comegna sustained a predominantly “minor injury”, and
Entitlement to a special award.

The Arbitrator ruled that Ms. Comegna is barred from arbitrating her NEB claim because Aviva gave her a notice under s. 44 of the Schedule, requiring her to attend to be examined by a health professional on October 22, 2016, and she did not complete the examination. The Arbitrator found that this was a “critical and fatal mistake”. The Arbitrator also found that Ms. Comegna sustained a predominantly “minor injury” as a result of the accident. She has not appealed that ruling.

III. ANALYSIS

The October 22nd Examination

The Arbitrator relied upon s. 55.2 of the Schedule for his conclusion on the NEB. That section states:

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

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.

The Arbitrator ruled that the events leading to Aviva giving Ms. Comegna the notice under s. 44 were irrelevant. He stated:

…the Applicant made a critical and fatal mistake when she refused to complete the s. 44 examination of Dr. Syed on October 22, 2016. This is the overriding factor that determines whether or not this issue can be arbitrated at all; therefore, the events leading to October 22, 2016 are of no consequence.²

The Arbitrator noted that Ms. Comegna made other submissions about whether she was precluded from proceeding, but he only addressed one of them: whether she received the notice for the examination. He found that she did.

In her written submissions on the appeal, Ms. Comegna raised questions about whether the examination was reasonable and necessary and whether her conduct was a failure or refusal to attend. The Arbitrator did not address these issues and it is not apparent from the appeal record that they were raised before him. The hearing was recorded, but the parties did not file a transcript. Aviva did not raise an objection about the issues in its responding written submissions. Its submissions also raised issues that the Arbitrator did not address. I wrote to the parties about this on June 27, 2017 and I convened a Case Conference to discuss it on August 2, 2017. The parties agreed in that discussion that the additional issues they raised were indeed before the Arbitrator.

In effect, the Arbitrator ruled that the circumstances under which an insured person does not attend an insurer examination are irrelevant to the question of whether mediation is precluded. The only pre-requisite is service of a notice. I disagree. I find that the Arbitrator erred in disregarding “the events leading to October 22, 2016”.

Section 55.2 only precludes mediation where notice requiring an examination has been given “in accordance with this Regulation...under section 44”. It follows that, before deciding preclusion, the Arbitrator was required to decide whether proper notice was given. Section 44(1) only allows examinations that are “reasonably necessary”. Therefore the Arbitrator could not find that Ms. Comegna is precluded from proceeding without addressing her submission that the examination was not “reasonably necessary”.

Further, the preclusion in s. 55 must be interpreted in the context of the entire Schedule. Section 37(7) provides relevant context. That section allows the insurer to refuse to pay a benefit for non-compliance with notice under s. 44, but only “for the period after the insured person failed or refused to comply”. In my view, two relevant considerations flow from s. 37(7).

First, when read together with s. 55, there is no preclusion of mediating a claim for NEBs for the period before any failure or refusal to comply with s.44. Ms. Comegna claimed NEBs starting August 13, 2014. The Arbitrator found that she failed to attend on October 22, 2016. It would be perverse to conclude that she is barred from pursuing a claim for the period starting on August 13, 2014 and ending on the date of any failure or refusal to comply. The Arbitrator’s approach would mean that any failure to comply with a s. 44 notice precludes all mediation. For instance, failure to attend an examination on the issue of housekeeping and home maintenance benefits would preclude mediating a dispute about income replacement benefits. The Legislature could not have intended that absurd result.

Second, there is no preclusion under s. 55 unless there is a finding that the insured person “failed or refused to comply.” Therefore, the Arbitrator was required to address Ms. Comegna’s submission that when she attended for the examination but did not complete it, she did not fail or refuse to comply.

The Arbitrator indicated that the result was dictated by the binding decision in Volpe v. Co-operators.³ He wrote: “the recent Ontario Superior Court decision of Volpe v. Co-operators is binding on my decision, as it is directly on point.⁴” The Arbitrator was wrong about the decision being binding. Volpe was decided by a judge sharing concurrent jurisdiction with the Arbitrator. He was not bound by it.⁵ Besides, the Arbitrator did not follow the approach of Volpe. The Court in Volpe did not disregard the events leading to the s.44 notice. The decision reflects a determination of both the validity of the notice and the necessity of the examination. The Court made the following determinations:

I am of the view that the information provided was sufficient to allow the plaintiff to make an informed decision as to whether or not to attend at the examination, particularly in light of the fact that she was represented by a lawyer at the time.⁶

And:

So far as the reasonableness of the request for the examination is concerned, at the time the request for the s. 44 examination was made, the insurer had no medical information with respect to the plaintiff’s injuries and I find that it was reasonable to request the plaintiff to attend at an examination⁷.

As I stated earlier, the Arbitrator erred in disregarding the events preceding the examination of October 22, 2016. In doing so, the Arbitrator did not make findings of fact that would allow me to substitute my decision for his. The question must therefore be remitted for re-hearing by a different Arbitrator.

The other issues

In their written submissions, the parties raised additional issues relevant to Ms. Comegna’s entitlement to NEBs, which the Arbitrator did not address. They include:

What was the date on which Ms. Comegna applied for NEBs?
Whether Ms. Comegna is deemed to be entitled to payment of NEBs for a period between when she applied and when Aviva gave her notice under s. 44
Whether Ms. Comegna is precluded from proceeding for failure or refusal to attend other examinations, and
Whether Ms. Comegna meets the test for entitlement to NEBs

In our Case Conference of August 2, 2014, the parties agreed that these issues were also raised before the Arbitrator. There are no findings of fact that would allow me to address them. Therefore, for the sake of clarity, I have ordered that there is to be a de novo re-hearing of this matter on the issue of Ms. Comegna’s entitlement to NEBs. Since, the Arbitrator’s dismissal of Ms. Comegna’s claim for a special award flowed from his conclusion on the NEB, that question must also be re-heard.

The Arbitrator also found that Aviva is entitled to its expenses, presumably based upon its success. He did not fix an amount. The Arbitrator’s decision regarding the Minor Injury Guideline still stands, so Aviva is still in a successful position on that issue. I have therefore remitted the issue of expenses of the hearing before the Arbitrator for re-hearing, but that issue may be determined by the same Arbitrator.

IV. EXPENSES

I received no submissions on expenses of the appeal. If the parties are unable to agree, an expense hearing may be arranged in accordance with Rule 79 of the Dispute Resolution Practice Code.

August 24, 2017

Jeffrey Rogers Director’s Delegate

Date

Footnotes

The Statutory Accident Benefits Schedule — Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.
At page 8
2017 ONSC 261
At page 9
For a discussion of this issue see Sittler and Canadian General Insurance Company [FSCO P-004495 & V-004495, August 11, 1995, and Fisher and Pilot Insurance Company [FSCO P-010819 and P-010820, July 16, 1996]
At paragraph 65
At paragraph 68