Financial Services Commission of Ontario

Neutral Citation: 2017 ONFSCDRS 238

FSCO A14-001528

BETWEEN:

KIFAH ABOUZINNI Applicant

and

ALLSTATE INSURANCE COMPANY Insurer

DECISION ON A PRELIMINARY ISSUE

Before: Arbitrator Benjamin Drory

Heard: In-person at London, Ontario on July 26 and 27, 2017

Appearances: Mr. Robert Van Praet and Ms. Jennifer Mitchell for Mrs. Kifah Abouzinni Ms. Sharla Bandoquillo and Ms. Dagmara Mroczkowska for Allstate Insurance Company

Issues:

The Applicant, Mrs. Kifah Abouzinni, was injured in a motor vehicle accident on October 8, 2008. She sought accident benefits from Allstate Insurance Company (“Allstate”), payable under the Schedule.¹ The parties were unable to resolve their disputes through mediation, and the Applicant, through her 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.

The issues in this Hearing are:

1. Is Allstate’s denial of caregiver benefits dated June 2, 2009 valid?

2. If the denial is valid, is Mrs. Abouzinni’s claim for caregiver benefits statute-barred? If the denial is not valid, what is the consequence?

3. Is either party entitled to expenses arising from this proceeding?

Result:

1. Allstate’s denial of caregiver benefits dated June 2, 2009 was not valid, as Mrs. Abouzinni had not elected to seek a caregiver benefit.

2. As a consequence of the denial not being valid, Mrs. Abouzinni is entitled to elect either a caregiver benefit, non-earner benefit, or income replacement benefit, not subject to a time limit.

3. If the parties are unable to mutually agree on the entitlement to and/or quantum of the expenses of this matter, either of them may request an appointment with me for determination of same in accordance with the provisions of Rules 75 to 79 of the Dispute Resolution Practice Code.

EVIDENCE AND ANALYSIS:

BACKGROUND

In opening statements, counsel for the Applicant submitted there was no completed OCF-10 (Election of Income Replacement, Non-Earner or Caregiver Benefit) in Allstate’s file. The Applicant only spoke limited English, and all interactions with Allstate were done through her husband. As the accident was nearly 9 years ago, the Applicant and her husband would attempt to recall as much as possible, but had relied on Allstate’s guidance to help them through an unknown and tough process. The Applicant and her husband thought she had actually been approved for a caregiver benefit, based on telephone discussions with Allstate, and had no knowledge of the denial until this litigation commenced.

Allstate agreed there was no OCF-10 on file, but the OCF-1 (Application for Accident Benefits) clearly indicated the Applicant was a caregiver for 4 children aged 9-15 years old at the time of the accident, and could not return to caregiving duties after the accident. The benefit was clearly and unequivocally denied by an OCF-9 from Ms. Aiena Dhillon, which warned of the standard 2-year limitation period and right to the dispute resolution process. Allstate’s position was that, based on past decisions, the OCF-1 is the application for all weekly benefits available to the Applicant.

EVIDENCE

Witnesses

Ms. Kifah Abouzinni

Mrs. Abouzinni testified through an Arabic interpreter. She understands a little English, and has vision and concentration problems attributable to the accident. She did not recall the OCF-1;² she confirmed the handwriting in it was her husband’s, but the signature was hers. Her husband did everything for the application on her behalf—he’d write her name and attempt to explain the documents to her, and she signed. Her husband would review all pieces of mail from the Insurer.

Mrs. Abouzinni said she understood the difference between caregiver and non-earner benefits, and thought she was going to receive a caregiver benefit. She never received a denial of caregiver benefits before litigation, and didn’t recall specifically picking caregiver or non-earner benefits. She did not recall receiving the unsigned OCF-9³ before litigation. When documents were received, her husband would fill them out and send them in every time.

On cross-examination, Mrs. Abouzinni said she wasn’t employed at the time of the accident. At that time, she only took care of her children—cooking, cleaning, and getting them ready for school— and did housekeeping tasks. She said the accident affected her ability to complete those tasks and take care of her children. Previously she would go the park with her kids, walk, and go to the gym; she couldn’t do that after the accident. Her husband’s sister-in-law would come to help.

She didn’t recall how the Insurer became aware of the claim. She didn’t specifically remember her husband speaking to the Insurer. But she said her husband was told by the Insurer that they would assist them with applying for benefits regarding the kids, like caregiver. She remembered her husband saying they would receive some kind of package, but didn’t remember opening it.

She confirmed that in Part 5 of the OCF-1 (“Applicant Status”), there was a check beside “Caregiver”; “Unemployed” was not checked.

She did not recall the OCF-3⁴ of Dr. Tompkins, who was her family physician at the time. She said she and her husband hired a lawyer “right after the accident”, although she didn’t know if this was months or weeks after.

Ms. Bandoquillo asked Mrs. Abouzinni if she recalled a letter from Layla Abouzeeni to the Insurer dated December 29, 2008.⁵ Mrs. Abouzinni said Ms. Abouzeeni is her husband’s sister-in-law, but she didn’t remember the specific letter. Allstate submitted the letter, which stated as follows:

This is to confirm that I am currently conducting all work concerning the day to day upkeep at the household of Kifah Abouzinni… I have carried out these responsibilities since October 9, 2008.

Kifah has paid me a weekly rate of $100 for cleaning the house and an additional weekly rate of $400 for taking care of all 4 of her children’s needs including: dressing, bathing, cooking, laundry, snow shovelling, shopping, and all other related tasks that she performed prior to her unfortunate accident.

I have received payment for the weeks of October 12 & 19, 2008 in the amount of $500 each week for a total of $1000.

If you have any questions or need additional information, please do no hesitate to contact me at the above noted address.

Ms. Bandoquillo also put to Mrs. Abouzinni a letter addressed to her from Lynn Smith of Allstate dated October 20, 2008.⁶ The letter included the following:

Our information indicates that you may qualify for Caregiver Benefit (CGB) or Non-Earner Benefit (NEB). Only one of these benefits may be payable and you must therefore choose which one you wish to be considered for.

The benefit you choose will be payable only if you meet the specific disability test for that benefit. The disability test for each benefit is outlined below. Determination of whether you meet the disability test is made by considering such things assessments by health practitioners and professionals in relation to your normal duties and activities. You should note that certain benefits might pay a higher weekly benefit than others; however the duration of those benefits could be shorter given the disability test of each benefit.

I am attaching to this letter a form entitled Election of Income Replacement, Non-Earner or Caregiver Benefit (OCF-10/59) on which you must make your choice.

You must complete and return this form to me within 30 days. No benefit can be paid until this form is returned.

The letter also provided basic information on caregiver and non-earner benefits, and purported to attach an OCF-10 form with it.

Mrs. Abouzinni did not recall any discussion of $400 for caregiver benefits versus $185 for non-earner benefits. She confirmed she was living at the address in Woodstock at the time.

Mrs. Abouzinni confirmed on re-examination that she had no experience with accident benefits before, and was giving the best truthful evidence she could.

Mr. Khalad Abouzeeni

Mr. Abouzeeni is the Applicant’s husband; they were married in 1991. He conducted all communications with Allstate on the Applicant’s behalf, by her request. He never received anything by fax; only by mail. He couldn’t recall when, but he reached out to his Allstate agent Jay Winters in London, who in turn reached out to head office. Mr. Abouzeeni had no prior experience with Ontario accident benefits. When he called Mr. Winters he had no lawyer, and didn’t recall if he had a lawyer when he applied for accident benefits.

He didn’t have a specific recollection of the OCF-1, but confirmed the handwriting was his and the signature was his wife’s. He filled the document out on his own with his wife as accurately as he could, and with no intent to mislead.

He said he ticked the Caregiver box in Part 5 because that was the description that best applied to the Applicant; it was unclear if he should only tick one. The Applicant was babysitting for a friend at the time, but didn’t work for a company or have any kind of employment arrangement. The Insurer never called regarding whether the Applicant was employed or unemployed at the time of the accident.

When mail came, he and the Applicant would sit down and read it together and discuss what they were asked to do. He didn’t recall if there were specific other documents with the OCF-1. He always returned forms when required. He retained either Robert Van Praet or Harrison Pensa then, and has had continuous representation since. He didn’t recall receiving or completing an “election form 10” (“OCF-10”) caregiver vs. non-earner benefits; if he did, he would’ve sat down and read it. He didn’t recall receiving Lynn Smith’s October 20, 2008 letter.⁷

Mr. Van Praet put to Mr. Abouzeeni the copy of the October 20, 2008 letter he had in his records.⁸ At the bottom of this copy read:

This fax was sent with GFI FaxMaker fax server. For more information visit: htt ://www. fi.com (sic)

Mr. Abouzeeni said he never received a fax, and two days earlier was the first time he had seen this. He didn’t know where GFI FaxMaker comes from.

He remembered some phone conversations with Allstate respecting caregiver vs. non-earner benefits. The adjuster told him her professional opinion was the Applicant qualified for caregiver benefits; so he was of the understanding she qualified for caregiver benefits, and this was better than non-earner benefits, since that was the adjuster’s opinion professionally.

Mr. Van Praet put to Mr. Abouzeeni an OCF-9 from Lynn Smith dated November 18, 2008.⁹ In the “Eligible” section, it stated as follows:

You may be entitled to receive Caregiver benefits up to $250.00 for the first child per week, and expenses up to $50.00 per week for every subsequent child thereafter, if you suffer a substantial inability to perform your regular caregiving activities as a result of the motor vehicle accident. These expenses must be incurred (i.e. receipts are required) and submitted for consideration. If you have any questions, please contact me.

In the “Not Eligible/Stoppage of Benefit” section, it stated as follows:

Received your completed Application for Accident Benefits on November 10, 2008. It indicated you were unemployed and had not worked 26 of the last 52 weeks, therefore you are not entitled to Income Replacement Benefits. As you indicated you are a Caregiver, you are not entitled to Non Earner Benefits. If you have any questions, please do not hesitate to contact the writer.

Mr. Abouzeeni did not recall receiving the OCF-9; but from what was in front of him, he understood it entitled the Applicant to caregiver benefits of $250 for the first child and $50 per child thereafter. But it was also saying the Applicant was not entitled to income replacement benefits, and because she was a caregiver she was not entitled to non-earner benefits. He understood the Applicant had the option to pick. He understood thorough his conversation with the adjuster at Allstate that they qualified for the caregiver benefit and would be receiving it. Prior to this litigation, he was unaware there was a denial for this benefit.

Mr. Abouzeeni did not recall the June 2, 2009 OCF-9 of Aiena Dhillon¹⁰ or receiving it at his Woodstock address. He thought the benefit was being paid.

On cross-examination, Mr. Abouzeeni said the Applicant was doing babysitting at the time of the accident for a friend’s children and received payment, but was not sure for how long. She performed the bulk of caregiver tasks at their house, and after the accident she required help for those. Everything was affected—she couldn’t go shopping or to the gym. Prior to the accident, she attended the gym 2 hours per day. Following the accident, she could no longer babysit or take care of their children.

Ms. Bandoquillo put to Mr. Abouzeeni that the OCF-1 indicated he was the Applicant’s “representative”. He said he didn’t recall when they sought the advice of a lawyer. Ms. Bandoquillo put to Mr. Abouzeeni a letter from Rebecca L. Pepper of Nesbitt Coulter Law firm dated March 6, 2009,¹¹ advising Nesbitt Coulter had been retained on behalf of the Mr. Abouzeeni and Mrs. Abouzinni respecting the motor vehicle accident. Mr. Abouzeeni recalled Nesbitt Coulter, but didn’t recall when he switched lawyers. After that time, his understanding was the Insurer would still communicate with both him and their lawyer.

Mr. Abouzeeni confirmed that Layla Abouzeeni is his sister-in-law. He didn’t remember how she became aware of how housekeeping and caregiver benefits work.

He recalled taking a form to Dr. Tompkins, but didn’t recall why. Ms. Bandoquillo put to Mr. Abouzeeni an OCF-9 dated January 26, 2009,¹² which stated as follows:

We received a letter from Layla Abouzeeni dated December 29, 2008, indicating that she has been looking after your four children since October 9, 2008, for a weekly payment of $400.00. As per Section 35 (2) of the Statutory Accident Benefits Schedule, we cannot consider payment of same until we receive a completed Disability Certificate (OCF-3).

Mr. Abouzeeni didn’t recall seeing the specific form. He did communicate with Dr. Tompkins’ office. Mr. Abouzeeni confirmed his address at Woodstock at the time of the alleged mailings.

On re-examination, Mr. Abouzeeni said he had no basis to disagree that October 20, 2008 was the first time he spoke with the Insurer. Dr. Tompkins’ office was hard to get materials from—Dr. Tompkins was unhappy that he was receiving lots of forms from the Insurer. He was opening a second office in Guelph, and was concerned about letters from a lawyer saying he had to attend somewhere for 3 days; he was “so busy”. Mr. Abouzeeni said it was hard to get him to do anything on their behalf, and they were provided repeated excuses like “they’re on my mantle”.

Mr. Abouzeeni acknowledged the Insurer sent things to his address, but said that they also made errors—for example, they had sent something to Layla Abouzeeni at his address, but she didn’t live in Woodstock.

Ms. Aiena Dhillon

Ms. Dhillon was summonsed to attend at the hearing. She did not attend in-person, but testified by telephone, partly attributable to a family emergency. I noted Mr. Van Praet’s procedural concerns with allowing telephone testimony of a summonsed witness, but allowed Ms. Dhillon to proceed.

Ms. Dhillon currently works with Desjardins; she previously worked for Allstate. She didn’t know the exact dates she was with Allstate, but thought it was from March 2009 to April 2011. She was a claims advisor in 2008. She was only on the Abouzinni file for a brief period; she reviewed the file in advance of her testimony.

Ms. Dhillon said that the Applicant ticked off “Caregiver” in Part 5 of the OCF-1; in Part 7, she acknowledged that she was the main caregiver for her children. Ms. Dhillon said she would have absolutely reviewed the OCF-1; she didn’t specifically recall this OCF-1, but she reviews all documents.

Ms. Dhillon was asked to review the adjuster’s log notes for the file.¹³ Her log note entry dated May 26, 2009 read as follows:

Injuries > WADII; left hand contusion; exacerbation of pre-existing migraine headaches; lower abdominal wall pain; lower back pain

IRB > N/A

NEB > Yes – 9-12 weeks

CG > No

HSKP > Yes – 9-12 weeks

Medical > continues with physio sessions; tx’d for pre-existing migraine headaches

Completed by: Dr. Brock Tompkin – Northwood Medical Centre – Physician

She was also referred to Dr. Tompkins’ OCF-3.¹⁴ There, Dr. Tompkins concluded the Applicant did not meet the test for caregiver benefits, and stated “Her children are old enough to assist in meal preparation, house cleaning and are able to bathe and dress themselves.” At the time of the accident and the OCF-3 (late-2008), the Applicant’s children were 15, 12, 11, and 9 years old.

Ms. Dhillon was then referred to her OCF-9 dated June 2, 2009,¹⁵ which denied the Caregiver benefit in the “Not Eligible/Stoppage of Benefit” section:

Accordingly, you elected the Caregiver Benefit and thus do no qualify for the Non-Earner Benefit. Accordingly, we have just received the completed Disability Certificate [OCF-3] dated November 8, 2008. Dr. Tompkins confirmed that you do not require assistance with caregiving as your children are old enough to complete all housekeeping, cleaning, bathe and dress themselves. Therefore, we are in the position to advise you that you do not meet the criteria under the Statutory Accident Benefit Schedule and thus not entitled to this benefit pursuant to Section 13 [1]. You also do not meet the criteria for Non-Earner Benefit pursuant to Section 12 [3] of the Regulation as your doctor has also specified that your injuries prevent you from doing MOST of the strenuous household chores.

Ms. Dhillon said that this was a denial letter—Dr. Tompkins confirmed the Applicant didn’t require caregiver benefits because her children were old enough to tend for themselves. The information on the back page advised the Applicant of her rights to mediation and arbitration, and warned of the 2-year limitation period.

Ms. Dhillon was asked to comment on her log note from June 2, 2009,¹⁶ which stated:

1: Sent out OCF9 addressing both CG benefits re. OCF3 dated Nov8/08 and NEB re. OCF3 dated Nov8/08

2: Sent out sec 68 letter attached OCF6 and OCF3.

Ms. Dhillon said she had no reason to think the OCF-9 was not sent. She would’ve created a letter in the computer and would’ve printed it herself, but she didn’t recall the procedure for who put it in an envelope or how it got mailed. She didn’t believe any caregiver benefits were owing to the Applicant from the date of the accident to the date of denial—there was no medical evidence supporting that the Applicant’s children required assistance.

Ms. Dhillon confirmed the letter from Ms. Layla Abouzeeni¹⁷ was the kind of letter she would have reviewed. Ms. Dhillon also confirmed she would’ve reviewed all of the treatment plans upon file transfer. This included a treatment plan from Kathryn Tansley (physiotherapist) dated November 18, 2008,¹⁸ which stated “Mrs. Abouzinni is currently unable to look after her children and has required additional family support to help her with household activities such as: mopping vacuuming, laundry, yard work, and gardening.” Ms. Dhillon was asked if she had any reason to think the Applicant had elected non-earner benefits; she replied no, she was confident she elected caregiver benefits.

On cross-examination, Ms. Dhillon stated she started adjusting in May 2001, so has seen many files. She had no independent recollection of this file, so her opinions were based on the log notes. She confirmed it was important for log notes to be complete and accurate, and she would’ve reviewed the existing log notes and documents in the file.

Ms. Dhillon did not feel it was important to note who the Insurer was sending documents to; what was important to her was what was said in the log notes. When asked how the notes could be relied on, Ms. Dhillon said it was because they were all smart advisors, and they could trust their colleagues to send documents to the relevant parties. She couldn’t remember cover letters that were sent regarding OCF-1s or OCF-10s, or what Allstate’s policy was regarding cover letters, or if there was correspondence regarding the Applicant’s lawyer’s letters.

Ms. Dhillon said an OCF-1 can potentially be an application for all benefits—it is up to the adjuster. She believed there was no OCF-10 in the file, but if the Applicant could potentially receive more than one weekly benefit then “of course” an OCF-10 would be sent. The election forms are not sent out before the OCF-1. She said of course she would follow up regarding elections, but it is also dependent on the legal representative to submit the election form on an applicant’s behalf. If an applicant is unrepresented then she would take extra care to advise them to ensure they understand.

Mr. Van Praet put to Ms. Dhillon a letter from Allstate to Mrs. Abouzinni dated February 10, 2010.¹⁹ It stated:

This is a friendly letter to notify that there has been a change of adjuster on your file. The undersigned has obtained carriage of your accident benefits file.

The letter notified that all future correspondence should be sent to Susan Ramlochan, Senior Claims Advisor. The letter also concluded:

PS: We were advised that you are no longer represented by Harrison Pensa, LLP. Please advise if you currently have legal representation. If so, we will require the signed authorization and contact information.

Mr. Van Praet put to Ms. Dhillon, that in the log notes from 2010, it appeared that Ms. Dhillon was still adjusting the file in June and July 2010. Ms. Dhillon couldn’t speak to whether the February 10, 2010 letter constituted a permanent notification, or if it was simply reflecting a vacation. She couldn’t identify if there was a change in the adjusters’ log notes. She agreed that there was no indication in the log notes that Harrison Pensa LLP was not representing the Applicant, and couldn’t say what was correct or incorrect. She did not recall what a section 68 letter was.

Ms. Dhillon said the OCF-3 from Dr. Tompkins was addressing all benefits she could potentially receive, and those she could elect between. She said Allstate didn’t elect caregiver for the Applicant. When asked who elected the caregiver benefit, she could only say necessary benefits were addressed; but based on the documents on file, she would assume the Applicant’s election would be caregiver.

With respect to her June 2, 2009 OCF-9, Ms. Dhillon said she couldn’t recall why it indicated that the Applicant elected caregiver. If there was no election on file then that would be incorrect—but not misleading. Ms. Dhillon confirmed that she saw Dr. Tompkins’ OCF-3 opining about caregiver and non-earner benefits. She confirmed there was nothing in her OCF-9 indicating it was cc’d to anyone. Mr. Van Praet referred Ms. Dhillon to her June 2, 2009 letter²⁰ to Mrs. Abouzinni which indicated she had taken over carriage of the file; it read:

Please be advised that I have taken over carriage of your accident benefits file. Please forward all inquiries directly to your lawyer—Rebecca Pepper as we have confirmed you have retained her office to represent you in this matter.

Regards,

Aiena Dhillon, B.A. Psych., C.R.S [Certified Rehabilitation Specialist]

Senior Accident Benefit Claims Advisor

Cc. Nesbitt Coulter – Attn: Rebecca Pepper

432 Simcoe Street

Woodstock, Ontario N4S-1J8

Ms. Dhillon confirmed it was regular practice to send out multiple letters in the same day. The letter advising of changing adjusters would have been a separate letter; it would not have been a second letter attached with the OCF-9. She couldn’t say if she would expect to see continued requests from counsel to pay or deny a benefit. Mr. Van Praet put to Ms. Dhillon two letters he wrote to Susan Ramlochan, dated December 29, 2011²¹ and February 14, 2012.²²

The December 29, 2011 letter read:

We note that Allstate acknowledged that Kifah Abouzeeni was eligible for a caregiver benefit in your OCF-9, dated November 18, 2008. However, to date no such benefit has been paid nor have we received a formal denial of same. Therefore, we kindly request that you forward the appropriate benefit to our client forthwith.

The February 14, 2012 letter read, in part:

Further, I refer to my letter of December 29, 2011 and confirm that to date my client has not received the outstanding caregiver benefit. We again request that you forward the appropriate benefit to our client forthwith. Should we not receive this from you shortly, we will have no choice but to mediate the issue.

Ms. Dhillon confirmed she saw no notations in the log notes about these letters. She agreed that adjusters owe a duty of good faith to applicants.

She couldn’t recall if she took steps to ensure what the Applicant understood.

On re-examination, Ms. Dhillon couldn’t remember if she always sent a cover letter with an OCF-9, or if she relied on other documents to determine what information was sent to whom. Ms. Dhillon said she left Allstate in March 2011.

Ms. Lynn Smith

Ms. Smith has been an Allstate employee since 2004; she was a Claims Advisor both in 2008 and presently. She didn’t recall the Abouzinni file specifically, but reviewed her portion of the notes. She said she took notes and kept records of all her calls with Mr. Abouzeeni.

Her log note dated October 20, 2008²³ is the first entry in the log note file. It read, in part (sic):

Details were provided by Khaled [sic] Abouzeeni.

Kifah is suffering pain to her neck, shoulders, and back. She is unable to provide any caregiving our [sic] housekeeping duties. She is unemployed, and has been off work for over a year. She had received a job offer (pending a police check), and was on her way back from her orientation when the accident occurred.

Kifah has four children under the age of 16, and she is their primary caregiver. She is unable to provide any care for them, and her sister-in-law is attending everyday to help out. The sister-in-law is attending daily for approximately 4 hours to assist with housekeeping and caregiving. The insured’s husband was also injured in this accident, and is doing what he can to assist with the children and his wife.

Ms. Smith confirmed the Applicant was noted as “unemployed”. She said she would have explained the benefits available to Mr. Abouzeeni—not income replacement benefits, but caregiver. She said in her work she doesn’t advise which benefit should be elected, but explains options to applicants and how to proceed with claims.

She said she sent an accident benefits package to the Applicant after the phone call. In the application package would have been OCFs 1, 2, 3, 5, and 23. Her October 20, 2008 letter²⁴ went out separately the same day explaining benefits, and would have included an OCF-10. Allstate wouldn’t keep any blank forms in their file; but they would leave a note on file if they received anything in return.

Ms. Smith confirmed that her November 13, 2008 log note documented the Applicant was the primary caregiver to her four children and was not employed at the time of the accident. It noted the OCF-1 dated October 26, 2008 was received on November 10, 2008, and the form was complete. She confirmed that her OCF-9 dated November 18, 2008²⁵ said the Applicant may be entitled to caregiver benefits, but that since the Applicant indicated she was a caregiver, she was not entitled to non-earner benefits. She said that this was because the OCF-1 indicated the Applicant was the primary caregiver and unable to do caregiving activities. She believed she had enough information in the OCF-1 to conclude it was a caregiver claim. Her log note dated November 28, 2008 also supported this, which noted the November 18, 2008 OCF-18 from Kathryn Tansley indicated the Applicant was unable to look after her children and required additional family support to assist with the children and housework. Ms. Tansley’s OCF-24 dated January 15, 2009²⁶ also indicated the Applicant lost time from caregiving as a result of the accident.

Ms. Smith confirmed she never got an OCF-10, but the OCF-1, OCF-24, and OCF-18 on file gave her the information she needed for the caregiver claim. Her March 24, 2009 log note said she received a letter from a solicitor asking for a copy of the file, and she sent it out, but had no recollection of her interaction with Nesbitt Coulter.

On cross-examination, Ms. Smith said she worked in clerical her first three years at Allstate; since 2008, she has worked on about 50 files per month. She had no independent recollection of the Abouzinni file, and relied on her file review. She confirmed she was the first representative on the file, and it was important to keep complete and accurate log notes. She said when documents go in and out she will note who received the form, but it is not necessary to note who it was sent to. She confirmed there is always a duty to act in good faith and provide accurate information and to assist applicants with understanding the process.

Ms. Smith said that entitlements to benefits couldn’t be based on one phone call; there would need to be an application. She confirmed that an applicant could be unemployed and get non-earner benefits. She also confirmed that the test for caregiver benefits isn’t merely whether you have children or not, nor does having children eliminate a non-earner claim. It is the Insurer that determines if the election selected by the Applicant will be approved. She said she did not elect the caregiver benefit, but provided Mr. Abouzeeni with information. It was the Applicant’s right to select the benefit, not the Insurer’s.

Ms. Smith said two packages were sent out to the Applicant. The completed election form was never received. She couldn’t corroborate with certainty where or whether the letters were sent.

Mr. Van Praet put to Ms. Smith her log note dated November 13, 2008,²⁷ which said “Have sent OCF-9 confirming receipt of completed OCF-1”. The OCF-9 in question was dated November 18, 2008²⁸ (5 days later). Ms. Smith said an OCF-9 has to be prepared before it is sent out; it might have been drafted at the time, and waiting for her manager to approve it. She didn’t have a draft of the OCF-9. She confirmed the file note was inaccurate. Respecting her comment in the OCF-9 that the Applicant was not entitled to non-earner benefits, Ms. Smith said that was incorrect based on what they received; she said an Applicant cannot get both benefits, but the election right is the Applicant’s.

Mr. Van Praet put to Ms. Smith a copy of her October 20, 2008 letter noting it had been faxed.²⁹ Ms. Smith said she had never seen it before, and it was not the version that was sent to the Applicant; if that was the only version the Applicant ever viewed, then it didn’t come from the Insurer, but from another source.

On re-examination, Ms. Smith said she has been involved in other cases where OCF-10s weren’t sent back. It was infrequent, and usually happened with income replacement benefits. She said the normal process in 2008-09 was to review forms and advise what benefits applicants were eligible for.

Closing Arguments

For Mrs. Abouzinni

The Applicant submitted that there was no valid Election of Benefits; therefore, there could not be valid denial of either the caregiver or non-earner benefit, because the Insurer could not make an Election of Benefits on behalf of the Applicant. The issue was not whether the denial in the OCF-9 was clear or unequivocal—rather, it was whether it could have even been made in the first place.

The events in question took place a long time ago, and witnesses for both sides failed to recall many details. However, the adjusters had been dealing with many cases, and were relying on often-inaccurate log notes for their evidence; for the Applicant and her husband, this claim was their life and they were deeply involved. English was the Applicant’s second language, and she had vision problems since the accident. Her husband never had any prior experience going through accident benefit claims. Ms. Smith understood that the Applicant was both unemployed and a caregiver at the time of the accident; she testified that an OCF-1 is not an election, and an election couldn’t be made by virtue of a phone conversation. Although two packages were sent out, only one was returned, and it did not include the OCF-10. Neither the Applicant nor her husband ever remembered getting the OCF-10, and both testified they would sit down and read all correspondence together and determine what to do about it. Mr. Abouzeeni testified he would have submitted any form that was required. There were no log notes suggesting an OCF-10 was ever sent or received. Ms. Smith’s OCF-9 said the Applicant was not entitled to non-earner benefits because she was a caregiver, but the Schedule says if an applicant qualifies for more than one weekly benefit, the applicant has the right to elect—which Ms. Smith agreed with. In addition, the log note dated November 13, 2008 said the OCF-9 dated 5 days later (November 18, 2008) had already been sent out.

Mr. Abouzeeni believed that Allstate elected the caregiver benefit for his wife since that’s what she qualified for. Allstate’s adjusters testified they were confident based on the submissions that caregiver benefits had been sought—but they didn’t have the Applicant’s choice based on an OCF-10.

The OCF-3 of Dr. Tompkins said the Applicant met the non-earner benefits test, but not the caregiver benefits test, because her children could bathe and care for themselves. Ms. Dhillon’s May 26, 2009 log note said the Applicant met the non-earner benefit test, but that the Applicant had applied for caregiver benefits—which Ms. Dhillon testified was incorrect.

Neither the Applicant nor her husband ever recalled Ms. Dhillon’s June 2, 2009 OCF-9, and in fact believed, until this litigation commenced, that the caregiver benefit had been approved and they were just waiting for payment.

The Applicant submitted that per s. 36 of the Schedule, an applicant can only receive one of income replacement, caregiver, or non-earner benefits at any period of time. Section 36(2) says that if an applicant qualifies for more than one of the benefits, an insurer must, within 10 business days after receiving the insured’s application, advise the applicant to give notice of their election within 30 days which benefit he/she wishes to receive. The Applicant submitted that where an applicant has no counsel, it is even more incumbent upon an adjuster to follow-up with the applicant.

The Applicant submitted that in Grewal and Certas,³⁰ the applicant submitted an OCF-1 indicating that she was working full-time at the time of the accident, and that she was a primary caregiver for her son. The adjuster did not provide information respecting a possible election of benefits, and an OCF-9 was issued denying an income replacement benefit. The Arbitrator found that although the denial was technically correct, it was invalid because the applicant was not informed of the requirement to elect between the two possible benefits. On appeal, Director’s Delegate Evans endorsed this decision and found that the Arbitrator did not err. The Applicant submitted that Grewal establishes an insurer cannot unilaterally decide which benefit an applicant will receive, and if a refusal to pay a benefit is made before the applicant makes a valid election, the limitation period cannot begin to run—an applicant “cannot be held to a refusal of a benefit she had no choice in seeking”.

The Applicant submitted that Antony and RBC General Insurance Co.³¹ establishes that an Insurer cannot hold an Applicant to an initial election if the Insurer provided insufficient information.

The Applicant submitted that in Kanagalingam and Economical Mutual Insurance Co.,³² the applicant submitted an OCF-1 indicating she might be eligible for both a caregiver benefit and an income replacement benefit. An OCF-10 was sent to the applicant advising her to elect between the two, and she elected a caregiver benefit. An OCF-9 was sent indicating that since the applicant elected caregiver benefit, she was not eligible to receive an income replacement benefit; but the applicant later attempted to seek payment for an income replacement benefit. The Arbitrator found the OCF-9 was not clear and unequivocal, and accordingly invalid such that the limitation period had not expired. On appeal, Director’s Delegate Rogers found that the election of benefits was invalid, and accordingly the 30-day period to elect did not apply and the applicant could re-elect. The Applicant submitted that Kanagalingam establishes if an election is invalid, the 30-day limit to re-elect is extended indefinitely.

The Applicant submitted that in Sobti and Waterloo Insurance Co.,³³ despite an OCF-9 being addressed to the applicant and her counsel, the Arbitrator found that the denial of a benefit was not received by either the applicant or her counsel. The OCF-9 was not signed, and no other supporting documents or proof of mailing them was provided, beyond the affiant merely advising the subject letters and forms were mailed, and without indicating the source of this information and belief. Accordingly, the limitation period failed to run.

The Applicant added that the words of s. 36(2) of the Schedule are such that if an applicant qualifies for more than one benefit, a notice of election must be sent. To decide that no election is necessary would go against the principles of statutory interpretation.

The Applicant concluded that an insurer cannot unilaterally decide which benefit an applicant will receive, and an election is not valid if it is not informed. If there was no valid election of benefits, there could be no proper denial. Alternately, the Applicant submitted that the June 2, 2009 OCF-9 denying caregiver and non-earner benefits was not sent to or received by Mrs. Abouzinni. The Applicant requested that she be given to the opportunity to elect or re-elect which of the non-earner benefit or caregiver benefit she wishes to receive, within 30 days of the date of this Order.

For Allstate

Allstate submitted that the Applicant’s Application for Arbitration with respect to caregiver benefits should be dismissed on the basis that the claim is statute-barred pursuant to s. 281.1(1) of the Insurance Act and s. 51(1) of the Schedule. An OCF-9 denying the caregiver benefit was issued on June 2, 2009; the Application for Mediation was not issued until over 3 years post-denial, on November 8, 2012.

Allstate submitted the case law is clear that for the limitation period to start to run, there must be a clear and unequivocal denial of a benefit by the insurer, which acts as the “triggering event”, and an insured who wants to pursue a claim must initiate action within two years of that denial.³⁴ The insurer has an obligation to inform the applicant of the dispute resolution process under ss. 279-283 of the Insurance Act, and to do so must provide a description of the most important parts of the process, such as the rights to seek mediation, to arbitrate or litigate if mediation fails, and that mediation must be attempted before resorting to arbitration or litigation. The explanation must also include a description of the relevant time limits governing the process.³⁵

Allstate submitted that it did this, and there could be no question the June 2, 2009 OCF-9 existed and was sent to the Applicant and her legal representative at the time.

Allstate submitted that, per Western Assurance Co. and Cejvan,³⁶ the OCF-1 is the application for weekly benefits, and an insurer is entitled to accept or reject all types of weekly benefits based on it. Allstate submitted that in the Ontario Superior Court case Straus et al. v. Aviva Canada Inc.,³⁷ the insureds did not need to elect which kinds of benefit to apply for, and were effectively applying via the OCF-1 for all benefits that were potentially available to them. The application process was not hindered by the insurer’s failure to include a written OCF-9 when sending the application package to the insureds. In this case, the Applicant and Mr. Abouzeeni confirmed the simplicity and accessibility of the language of the OCF-1, and denied the need to seek further assistance or clarification from Allstate. Per Cejvan, where multiple types of weekly benefit claims are denied based on information in an OCF-1, those denials will not be premature and will be sufficient to start the limitation period running. There are no separate OCF-1 forms for the different possible weekly benefits, nor are there any check boxes on the form to indicate that one is applying for any particular weekly benefit.³⁸ Allstate submitted that Straus et al. was a complete answer to the Applicant’s submission that she was somehow prejudiced by not having been provided with the application forms, a written explanation of available benefits, information to assist her in applying for benefits, or information regarding possible elections. Allstate noted, however, that it sent the Applicant a blank OCF-1, OCF-3, and OCF-10 by mail, and also sent a letter explaining caregiver and non-earner benefits. Allstate also submitted that in Sietzema v. Economical,³⁹ the Ontario Court of Appeal upheld that the OCF-1 constituted not only an application for income replacement benefits, but also for non-earner benefits, despite the fact that the OCF-3 filed with the application indicated that the insured did not meet the test for non-earner benefits. In Sagan v. Dominion,⁴⁰ the Court of Appeal upheld the insurer’s denial of non-earner benefits based on information obtained from the OCF-1. In Bustamante v. Guarantee,⁴¹ the Court of Appeal upheld the insurer’s denial on the basis of passage of the limitation period; the OCF-9 provided to the plaintiff gave clear notice of her rights of dispute, as well as warning of the two-year limitation period.

Allstate also submitted that once the Applicant retained a lawyer to seek advice on her rights, she could no longer plead ignorance or claim that the forms were misleading to her because she was unsophisticated with respect to auto insurance. The Applicant had retained counsel at the time of the June 2, 2009 OCF-9.

Allstate submitted there could be no doubt that it sent the blank OCF-10 and relevant information to the Applicant, along with the application package.

Allstate submitted that s. 24(8) of the Schedule obliges an insurer to provide an insured with reasons for a refusal, but does not provide that the reasons must be legally correct; the purpose is only to permit the insured to decide whether to challenge the cancellation.⁴² It submitted, though, that its reason for refusal in the June 2, 2009 OCF-9 was legally correct—it was based on the medical opinion of the Applicant’s family physician.

The pre-hearing letter dated March 31, 2015 identified the substantive issue at arbitration to be caregiver benefits. Nothing in the case suggested any inclination by the Applicant to elect non-earner benefits, and no evidence was led at the hearing of the Applicant’s interest in non-earner benefits at any point in time—which is consistent with Allstate’s position that the Applicant advanced a claim for caregiver benefits.

Allstate concluded that it has the right to rely on an OCF-1 to consider, approve or deny a claim. There was no dispute that the June 2, 2009 denial was clear and unequivocal, which met the Smith v. Co-operators test.⁴³ Sietzema, Turner, Sagan, and Bustamante were binding as decisions from the Court of Appeal, and Cejvan, a decision of the Director’s Delegate, was also binding, pursuant to Vo and Maplex.⁴⁴

Additional Submissions

Following the parties’ closing statements, I asked both parties to submit a blank OCF-10, as no OCF-10 had been input into evidence in the hearing, and to elaborate on the purposes of that form and how it is typically used in industry practice. The parties jointly submitted a blank OCF-10 accordingly.⁴⁵

For Mrs. Abouzinni

Ms. Mitchell, who conducted the closing statement for the Applicant, submitted that s. 36 of the Schedule states if a person’s application indicates he or she may qualify for more than one weekly benefit, the insurer shall notify an applicant that he or she must elect within 30 days after receiving the notice which benefit he or she wishes to receive. The OCF-10 is the pivotal form to elect. OCF-10 forms are pre-populated by an insurer and stamped with their address. The OCF-1 is not an election form, and Allstate’s adjusters agreed on that in their testimony—Ms. Smith said that an OCF-1 is not an election form, only an application form. There was no OCF-10 election form in Allstate’s file.

Ms. Mitchell added that in her normal duties as counsel, she does not give OCF-10 forms to clients—normally insurers send OCF-10s to applicants, and as counsel she advises clients how to complete and return them to the insurers. At the time the OCF-10 was allegedly sent in this case, the Applicant was unrepresented by counsel and had no experience with the accident benefits process.

For Allstate

Allstate submitted insurers are required to advise of the s. 36 election if an applicant qualifies for more than one of the three weekly benefits. However, s. 36 does not set out any consequence if an applicant fails to return the completed form within 30 days, whether or not he or she has counsel. Its decision to deny caregiver benefits was based on the OCF-1, which was consistent with case law. The Applicant’s OCF-1 only ticked “Caregiver”, and didn’t tick “Unemployed”; Mr. Abouzeeni also testified he knew what “unemployed” meant. Allstate also added that Ms. Smith testified insurer’s forms are not pre-populated.

For Mrs. Abouzinni

Ms. Mitchell replied that while there is no statement of consequence in s. 36 of the Schedule, an insurer cannot unilaterally select the benefit. Ms. Smith testified that she knew from her phone conversation with Mr. Abouzeeni that the Applicant was unemployed; per her duty of good faith, she could not turn a blind eye to that unwritten information that could benefit the Applicant.

ANALYSIS

Both sides presented me with several alternative arguments and streams of case law supporting their positions. I begin first by noting arguments that I do not find persuasive.

First, the insurer pointed to several cases identifying that the issuance of a clear and unequivocal denial, together with explanations of the dispute resolution process, triggers the limitation period running. Allstate submitted that Aiena Dhillon’s June 2, 2009 OCF-9 was a clear and unequivocal denial of the caregiver benefit. But the Applicant did not even dispute this; in fact, the Applicant agreed the wording of the June 2, 2009 was a clear denial on its face. The Applicant’s argument is not whether the June 2, 2009 OCF-9 was clear, but rather whether it could have ever been valid in the first place as a matter of law, on the basis that the Applicant had not made an election regarding weekly benefits. Accordingly, all of the cases submitted by the Insurer respecting whether a denial was “clear and unequivocal” are not determinative of the issue in this case.

Both sides also tried to establish whether letters and application forms from the Insurer were mailed to and received by the Applicant, and submitted cases on point. The Applicant submitted Sobti, where the Arbitrator determined the OCF-9 in question was unsigned, with no proof the documents were mailed beyond mere belief, and no basis elaborated for that belief. To determine what was conclusively mailed or received in this situation is impossible. It is reasonable for adjusters working at large insurance companies to put faith in their internal mailing processes, with the expectation that mail will be sent out and delivered as intended. Expecting adjusters to specifically recall mailing individual letters 9 years after the fact is not plausible. That is partly why official processes are created—so that the processes themselves might be sources of reliability. But the fact that processes were followed does not establish that the letters were in fact mailed and/or received. The insurance adjusters stating they were “sure” they had mailed the items is insufficient proof the items were received by the Applicant.

The most telling aspect of the mail issue to me is that Mr. Abouzeeni and Mrs. Abouzinni’s failure to return the OCF-10 was completely inconsistent with their actions with other pieces of mail. I found both Mrs. Abouzinni and Mr. Abouzeeni to be credible; there did not seem to be any intent to deceive, and they spoke to the extent of their recollection. It was clear throughout both of their testimonies that they were very engaged in the accident benefits claims, and were responsive and took the process seriously. This was reflected in their approaches to the OCF-1 and their repeated follow-up with Dr. Tompkins for the OCF-3. Mr. Abouzeeni also testified that, based on phone discussions with the adjuster, there was to be an election in the mail (although he also testified that he thought Mrs. Abouzinni had been approved for the caregiver benefit, based on the conversation). Thus I find it was unlikely that he would not have mailed the OCF-10 election form back if he received it. Mr. Abouzeeni seemed too invested in the process to simply not return a required form. He testified that he had never seen the election form before. I find that it is more likely than not that Mr. Abouzeeni and Mrs. Abouzinni never received the election form in the mail. I am also satisfied that Mr. Abouzeeni’s knowledge of caregiver benefits did not necessarily come from Ms. Smith’s October 20, 2008 letter (which purported to attach the OCF-10, if it was sent)—more likely it came through his telephone discussion with Ms. Smith, where they would have discussed that benefit in far more detail than in the letter. It was also alleged that the only version of the October 20, 2008 letter that Applicant’s counsel had in their file was stamped as having been faxed—which could not have come directly from Allstate itself.

I note that Allstate could have significantly expedited this matter by being more responsive to correspondence from the Applicant’s counsel, Mr. Van Praet. Mr. Van Praet wrote Allstate two letters, on December 29, 2011 and February 14, 2012, advising of his client’s belief that caregiver benefits had been approved and they were still awaiting payment. No evidence was provided that either of those correspondences was responded to—and the first one surely was not responded to, because Allstate’s failure to respond was noted in the second. My read of the first letter is that it should have alerted Allstate that there had been a serious miscommunication with their client. If Allstate felt the June 2, 2009 OCF-9 was a full answer to why caregiver benefits had not been paid, it could have been addressed through a response to the December 29, 2011 letter. At the very least, such a response could have at least exposed the parties’ difference in opinion faster, and the litigation of this issue could have been expedited relative to what took place.

Ultimately, there is only one line of argument that I find meaningful in resolving this case—was an election by the Applicant necessary, and was one made? I find that an election was necessary, but it was not made. Ultimately each side has one key case supporting their arguments—both of which are appeal decisions of Director’s Delegate Evans (Grewal and Cejvan) that are at cross-purposes with each other respecting the present facts, and require close analysis.

I distinguish Straus et al. from this situation. Straus et al. concerned arguments that the insurer did not comply with informational requirements in s. 32(2) of the Schedule—i.e., that the insurer failed to provide written descriptions of benefits, and should not be entitled to rely on the limitation period in the circumstances. That is quite different from the present facts, where I am satisfied that the Insurer provided descriptions of the relevant benefits. Rather, the facts of this case concern s. 36 of the Schedule, not s. 32.

In Grewal, Ms. Grewal submitted an OCF-1 indicating that she was working full-time as a tax associate with H&R Block, and also that she was the primary caregiver for her 14-year old son. The insurer’s adjuster did not provide information on any possible elections relating to income replacement, non-earner and caregiver benefits. H&R Block subsequently sent the adjuster an OCF-2 indicating that Ms. Grewal had only been employed for 10 of the 52 weeks preceding the accident, on which basis the adjuster determined that Ms. Grewal was not eligible for an IRB and sent a refusal. Although the arbitrator noted the refusal was technically correct, she found it invalid because the adjuster had not informed Ms. Grewal that s. 36(2) required her to elect between two possible benefits. As a result, the arbitrator held:⁴⁶

In conclusion, a refusal of a weekly benefit claim is invalid, even if technically correct at the time, where the refusal is made before the insured person has fulfilled her obligation under subsection 36(2) of the Schedule to elect the weekly benefit “he or she wishes to receive”. There can be no valid refusal where there has not first been a valid election. As a valid election is an informed election, there can be no valid election where an insurer has not met its consumer protection obligations by providing to the insured person information required by the legislation for an informed election. No time limit based on an invalid refusal, including the two-year time limit under section 51 of the Schedule and 281.1(1) of the Insurance Act, can begin to run.

On appeal, Director’s Delegate Evans held that the arbitrator properly directed herself to the law and applied it to the facts of the case, and accordingly he had no reason to interfere. The insurer’s appeal was dismissed.

Cejvan is the primary authority for the Insurer’s argument—i.e., that the OCF-1 was sufficient by itself for the Insurer to determine that caregiver benefits were applied for. Mrs. Cejvan was in an accident in 2008; although she had only recently retired, she did not set out her work history in the OCF-1 she submitted to her insurer. The insurer refused her entitlement to IRBs. Mrs. Cejvan filed for mediation on her IRB claim more than two years following the denial. An arbitrator held that the limitation period did not apply because the Application did not contain a claim for IRBs. On appeal, though, Director’s Delegate Evans held that an Application for Statutory Accident Benefits (OCF-1) contains all claims for weekly accident benefits, and therefore the Application necessarily contained a claim for IRBs—so the time limit applied.

In Part 5 of Mrs. Cejvan’s March 7, 2008 OCF-1, she ticked the box marked “Retired” under the “Not Employed” Heading, but filled in nothing in Part 8, which deals with Income Replacement Determination. On March 20, 2008, Mrs. Cejvan completed a second OCF-1; she marked “Retired” under Part 5 of the Application and crossed out Part 8. An OCF-3 marked “N/A, retired” for IRBs and “No” for non-earner benefits was completed as well. On April 16, 2008 Western sent Mrs. Cejvan an OCF-9 refusing both NEBs and IRBs. It stated that based on the disability certificate she did not qualify for a NEB, and also stated she did not qualify for an IRB, as neither the OCF-1 nor the OCF-3 indicated that she had worked 26 out of the last 52 weeks before the accident.

Director’s Delegate Evans held that the arbitrator erred when he stated that Mrs. Cejvan had not claimed IRBs when Western denied her entitlement. He stated all of the following, much of which I find relevant to this case.⁴⁷

The OCF-1, a form mandated by the Superintendent of Insurance under s. 227(1) of the Insurance Act, is the application for weekly benefits, and an insurer is entitled to accept or reject all types of weekly benefits based on it. (emphasis in original)

In that regard, I note that the OCF-1 does not have any boxes where insureds are supposed to specifically indicate whether they are applying for IRBs or NEBs. Instead, insureds set out their status at the time of the accident in Part 5, such as whether they were employed or not, and “details of [their] employment for the past 52 weeks” in Part 8. Insurers are therefore entitled to accept or reject more than one type of weekly benefit based on the OCF-1. That is what happened in the cases considered by the Court of Appeal, and that is what happened here.

Director’s Delegate Evans elaborated on the Court of Appeal decisions Sietzema, Galdamez, Turner, Katanic, and Sagan, all of which the present Insurer also referred me to, but none of which I find fit the facts of the present case. He continued:

Accordingly, where multiple types of weekly benefit claims are denied based on information in an OCF-1, those denials will not be premature and will be sufficient to start the limitation period running. There are no separate OCF-1 forms for the different possible weekly benefits, nor are there any check boxes on the form to indicate that one is applying for any particular weekly benefit. An OCF-1 therefore constitutes a claim for all possible weekly benefits, whether IRBs or NEBs. The insurer then assesses the possible claims based on the information provided, and thereafter accepts or denies them. A completed OCF-1 is, therefore, a basis upon which an insurer can refuse to pay an amount claimed as described in s. 281(5) of the Act and s. 51 of the SABS. A denial based upon such an OCF-1 will not be premature and will constitute a “refusal to pay the amount claimed.

At first glance, the conclusions of Director’s Delegate Evans in Grewal and Cejvan clearly lead to opposite results in this case. Grewal would suggest that there cannot be a valid refusal where there has not first been a valid election. Cejvan would suggest that the OCF-1 is sufficient in itself to constitute the application for all weekly benefits. For the reasons that follow, I prefer Grewal.

It is first necessary to consider s. 36 of the Schedule, which is the legislation mandating an election among weekly benefits in the first place. Section 36 reads as follows:

ELECTION OF INCOME REPLACEMENT, NON-EARNER OR CAREGIVER BENEFIT

36. (1) Only one of the following benefits may be paid to a person in respect of a period of time:

37. An income replacement benefit.

38. A non-earner benefit.

39. A caregiver benefit.

(2) If a person’s application indicates that he or she may qualify for more than one of the benefits referred to in subsection (1), the insurer shall notify the person that he or she must elect within 30 days after receiving the notice which benefit he or she wishes to receive.

(3) The insurer shall deliver the notice under subsection (2) within 10 business days after receiving the person’s application.

The text of s. 36(2) is clear that where a person indicates that he or she may qualify for more than one of the weekly benefits, the insurer must notify the person that he or she must elect which benefit he or she wishes to receive, and the “notice” in s. 36(3) must be delivered after receiving the person’s application. If the “application” is presumed to be the OCF-1, then it must be the case that the “notice” contemplated in s. 36(3) is distinct from the OCF-1 itself—otherwise it would not be required as a separate step following the application.

Accordingly, if the “notice” in s. 36(3) is not the “application” itself (i.e., OCF-1), then what form would it take? I suggest that the notice contemplated in s. 36(3) is the OCF-10. The OCF-10⁴⁸ is a straight-forward, one-page form, comprised of only three Parts— Part 1 “Applicant Information” (i.e., name, birth date, and contact information), Part 2 “Benefit Election”, and Part 3 “Signature”. Aside from the basic information in Parts 1 and 3, the only action an applicant must take in the entire form is check a box in Part 2—the entirety of which reads as follows (emphasis in original):

I choose to receive the following benefit:

Income Replacement Benefit [ ]

Non-Earner Benefit [ ]

Caregiver Benefit [ ]

The preamble in the OCF-10 also makes clear that an applicant can only receive one of these benefits, and must choose which one they wish to receive.

Throughout the hearing in this case, the Insurer asserted or implied that several OCF forms, particularly the OCF-1, OCF-3, and OCF-9, should be attributed significant weight and meaning. But if the series of OCF forms is to be deemed to have any meaning and necessity in the process—which they do—then it should not be assumed that any of the other OCF forms are irrelevant. It would be illogical to assume that the OCF-10 is of no meaning or consequence. The purpose of the OCF-10 is for an applicant to elect the weekly benefit that he or she wishes to pursue in circumstances where they may qualify for more than one.

The election also belongs to the applicant, and not the insurer. If that was not clear enough from the text of s. 36 itself (although I find it is), then that point was further confirmed by the testimonies of both Ms. Dhillon and Ms. Smith, Allstate’s adjusters. Ms. Dhillon said that if an applicant could potentially receive more than one weekly benefit, then “of course” an OCF-10 would be sent. Ms. Smith said that entitlements to benefits couldn’t be based on phone calls—there would need to be an application, and the letter she ostensibly sent on October 20, 2008 purporting to attach an OCF-10 said, in part, “No benefit can be paid until this form is returned”.

A major factor on which I distinguish the Cejvan case is that, in Cejvan, Director’s Delegate Evans never referred to s. 36 of the Schedule. He also made no reference to an OCF-10. From my reading on Cejvan, his decisions seems to have been solely based on OCF-1s that were put before him, and he may not have been presented with s. 36 of the Schedule nor an OCF-10, as was put before me in this case.

In Cejvan, a key part of Director’s Delegate Evans reasoning was as follows:

There are no separate OCF-1 forms for the different possible weekly benefits, nor are there any check boxes on the form to indicate that one is applying for any particular weekly benefit. An OCF-1 therefore constitutes a claim for all possible weekly benefits, whether IRBs or NEBs. The insurer then assesses the possible claims based on the information provided, and thereafter accepts or denies them.

It is true that there are no check boxes on the OCF-1 form to indicate that one is applying for any particular weekly benefit. However, on the OCF-10 form there are. I find it was likely intended by the drafters of the OCF forms that the OCF-10 would be used by applicants to indicate that they wished to apply for a particular benefit, not the OCF-1. I also interpret it was intended by the drafters of s. 36 of the Schedule that the “notice” contemplated in ss. 36(2) and (3) was intended to be separate from the “application”, which I accept to be the OCF-1.

I find Director’s Delegate Evans’ decision in Grewal most persuasive. There, the Arbitrator found, and Director’s Delegate Evans affirmed, that a refusal of a weekly benefit claim is invalid, even if otherwise technically correct, where the refusal is made before the insured person has fulfilled her obligation under s. 36(2) of the Schedule to elect the weekly benefit he or she wishes to receive; there can be no valid refusal where there has not first been a valid election.

Accordingly, I find that a valid election was necessary in this case, without which Allstate’s denial could not have been validly made. I also find that Mrs. Abouzinni did not validly elect to seek caregiver benefits.

Allstate never received an OCF-10 from Mrs. Abouzinni, and Mr. Abouzeeni and Mrs. Abouzinni denied ever even having received the form—although it was Mr. Abouzeeni’s impression from his phone call with Ms. Smith that his wife had in fact been approved for caregiver benefits. But Ms. Smith testified that a determination of benefits could not be made on the basis of a phone call, and a written application would be necessary. Ms. Smith was credible, and I take her testimony as credible descriptions of the administrative procedures in place at Allstate at the time. Allstate never received a written election from the Applicant, electing caregiver benefits, and I find that the OCF-1 was insufficient for this purpose, given that the wording of s. 36(3) requires a “notice” separate and distinct from the “application”.

The phone call between Ms. Smith and Mr. Abouzeeni was significant. On the basis of that call, Ms. Smith knew that, in addition to Mrs. Abouzinni being a caregiver for her four children, she was also unemployed—and therefore she could have potentially qualified for non-earner benefits. First-party insurers and adjusters owe a duty of faith to their clients, and even though “unemployed” was not ticked on the OCF-1 itself, it was incumbent on Ms. Smith to take this additional information she received from the Applicant into account—she could no longer simply rely on the OCF-1 itself as the full basis for adjusting the Applicant’s claims. When Dr. Tompkins’ OCF-3 was received opining that the Applicant met the non-earner benefit test, but not the caregiver test, this should have raised an alert with the Insurer.

Allstate made a further submission that the Applicant could have been assumed to have been pursuing caregiver benefits, and not non-earner benefits, because caregiver is a more valuable benefit with an easier test to meet. I do not find that determinative. I also do not accept the Insurer’s assertion that the Applicant never demonstrated any interest in a non-earner benefit, as it was implied by the Applicant’s counsel repeatedly throughout this hearing.

In the result, an election by the Applicant was necessary to seek the caregiver benefit, and no such election was made. Accordingly, per Grewal, the Insurer’s purported denial of the caregiver benefit was invalid, as there can be no valid refusal where there has not first been a valid election.

The consequence of the invalid refusal is an indefinite extension of the time limit to elect, per Kanagalingam,⁴⁹ where Director’s Delegate Rogers applied Antony⁵⁰ and held:

Antony means that, in the event of an invalid election, the 30-day time limit in s. 36(2) does not apply. As is the case with an invalid denial, the time limit is negated and time is indefinitely extended.

Accordingly, I order that Mrs. Abouzinni is entitled to elect which weekly benefit she wishes to pursue, and not subject to a time limit.

As a practical matter, this decision also means the substantive FSCO hearing in this matter is cancelled. A substantive hearing cannot be held on the caregiver benefit because it was never validly denied. But a substantive hearing could also not be held regarding a non-earner benefit because (a) it has never previously been elected, and as such (b) it has never been denied and (c) was never mediated. Any potential future litigation between the parties, arising from a future denial respecting the weekly benefits elected, would become the jurisdiction of the Licensing Appeal Tribunal.

EXPENSES:

If the parties are unable to mutually agree on the entitlement to and/or quantum of the expenses of this matter, either of them may request an appointment with me for determination of same in accordance with the provisions of Rules 75 to 79 of the Dispute Resolution Practice Code.

September 14, 2017

Benjamin Drory Date Arbitrator

Financial Services Commission of Ontario

Neutral Citation: 2017 ONFSCDRS 238

FSCO A14-001528

BETWEEN:

KIFAH ABOUZINNI Applicant

and

ALLSTATE INSURANCE COMPANY Insurer

ARBITRATION ORDER

Under section 282 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 Ontario Regulation 664, as amended, it is ordered that:

1. Allstate’s denial of caregiver benefits dated June 2, 2009 was not valid, as Mrs. Abouzinni had not elected to seek a caregiver benefit.

2. As a consequence of the denial not being valid, Mrs. Abouzinni is entitled to elect either a caregiver benefit, non-earner benefit, or income replacement benefit, not subject to a time limit.

3. If the parties are unable to mutually agree on the entitlement to and/or quantum of the expenses of this matter, either of them may request an appointment with me for determination of same in accordance with the provisions of Rules 75 to 79 of the Dispute Resolution Practice Code.

September 14, 2017

Benjamin Drory Arbitrator

Date

Footnotes

1. 1Effective September 1, 2010, the Statutory Accident Benefits Schedule—Effective September 1, 2010 (the “New Schedule”) came into force. The transition rules in the New Schedule provide that, subject to certain exceptions, benefits that would have been available pursuant to the Statutory Accident Benefits Schedule—Accidents on or after November 1, 1996 (the “Old Schedule”) shall be paid under the New Schedule, but in amounts determined under the Old Schedule. As a result, both the Old Schedule and New Schedule are applicable to accidents that occurred on or after November 1, 1996 and before September 1, 2010 and both should be considered.
2. 2Exhibit 1—Application for Accident Benefits (OCF-1) dated October 26, 2008 (Tab 1).
3. 3Exhibit 3—Explanation of Benefits Payable by Insurance Company (OCF-9) in the name of Aiena Dhillon, dated June 2, 2009 (Tab 11).
4. 4Exhibit 4—Disability Certificate (OCF-3) completed by Dr. Brock Tompkins, dated November 8, 2008 (Tab 12).
5. 5Exhibit 5—Letter from Layla Abouzeeni to Lynn Smith (Allstate) dated December 29, 2008 (Tab 18).
6. 6Exhibit 2—Letter from Allstate (Lynn Smith) to Kifah Abouzinni dated October 20, 2008 (Tab 19).
7. 7Ibid.
8. 8Exhibit 2A—Letter from Allstate (Lynn Smith) to Kifah Abouzinni dated October 20, 2008.
9. 9Exhibit 7—Explanation of Benefits Payable by Insurance Company (OCF-9) per Lynn Smith, dated November 18, 2008 (Tab 7).
10. 10Note 3, supra.
11. 11Exhibit 8—Letter from Nesbitt Coulter Law Firm to Allstate (Lynn Smith) dated March 6, 2009 (Tab 21)
12. 12Exhibit 9—Explanation of Benefits Payable by Insurance Company (OCF-9) per Lynn Smith, dated January 26, 2009 (Tab 9).
13. 13Exhibit 11—Redacted adjuster’s log notes, October 20, 2008 - July 19, 2013 (Tab 26).
14. 14Note 4, supra.
15. 15Note 3, supra.
16. 16Note 13, supra.
17. 17Note 5, supra.
18. 18Exhibit 6—Treatment Plan (OCF-18) per Kathryn Tansley dated November 18, 2008 (Tab 13).
19. 19Exhibit 12—Letter from Allstate (Susan Ramlochan) to Mrs. Abouzinni dated February 10, 2010.
20. 20Exhibit 12B—letter from Allstate (Aiena Dhillon) to Mrs. Abouzinni dated June 2, 2009.
21. 21Exhibit 14A—letter from Robert A. Van Praet of Dyer Brown LLP to Allstate (Susan Ramlochan) dated December 29, 2011.
22. 22Exhibit 14B—letter from Robert A. Van Praet of Dyer Brown LLP to Allstate (Susan Ramlochan) dated February 14, 2012.
23. 23Note 13, supra.
24. 24Note 6, supra.
25. 25Note 9, supra.
26. 26Pre-Approved Framework Extension Request & Discharge Report (OCF-24) per Ms. Kathryn Tansley, dated January 15, 2009 (Tab 14).
27. 27Note 13, supra.
28. 28Note 9, supra.
29. 29Note 8, supra.
30. 30Grewal and Certas Direct Insurance Co., FSCO Appeal P09-0001 (July 10, 2009).
31. 31Antony and RBC General Insurance Co., FSCO Appeal P03-00023 (July 22, 2004).
32. 32Kanagalingam and. Economical Mutual Insurance Co., FSCO Appeal P16-00049 (November 30, 2016).
33. 33Sobti and Waterloo Insurance Co., FSCO A13-000048 (June 20, 2014).
34. 34Zeppieri and Royal Insurance Company of Canada, OIC A-005237 (February 17, 1994; aff’d OIC P-005237, December 12, 1994).
35. 35Smith v. Co-operators General Insurance Company, 2002 SCC 30, [2002] 2 S.C.R. 129.
36. 36Western Assurance Company and Cejvan, FSCO Appeal P14-00007 (December 4, 2014).
37. 37Straus et al. v. Aviva Canada Inc., 2015 ONSC 4589.
38. 38Cejvan, note 36 supra, para. 20.
39. 39Seitzema v. Economical Mutual Insurance Company, 2014 ONCA 111.
40. 40Sagan v. Dominion of Canada General Insurance Company, 2014 ONCA 720.
41. 41Bustamante v. Guarantee Co. of North America, 2015 ONCA 530.
42. 42Turner v. State Farm Mutual Automobile Insurance Company, (2005) 2005 CanLII 3581 (ON CA), 195 OAC 51 (ONCA), and Katanic v. State Farm Mutual Insurance Company, 2013 ONSC 5103, 2014 ONCA 298.
43. 43Note 35, supra.
44. 44Vo and Maplex, FSCO Appeal P-002777 (December 12, 1997).
45. 45Exhibit 15—Election of Income Replacement, Non-Earner or Caregiver Benefit (OCF-10).
46. 46Grewal, note 30 supra, para. 9.
47. 47Cejvan, note 35 supra, at p. 3.
48. 48Note 45, supra.
49. 49Note 32, supra.
50. 50Note 31, supra.