Financial Services Commission of Ontario
Neutral Citation: 2017 ONFSCDRS 287 FSCO A16-002157
BETWEEN:
PRABHA RAJENDRAKUMAR Applicant
and
AVIVA CANADA INC. Insurer
REASONS FOR DECISION
Before: Arbitrator Louise Barrington
Heard: In person at the offices of ADR Chambers, 18 King Street East, Toronto, on September 13, 2017
Appearances: Mr. Mark Vella, Lawyer, participated for Applicant, withdrew during the Hearing Ms. Nathalie Rosenthall, Lawyer, participated for the Insurer
Issues:
The Applicant, Mrs. Prabha Rajendrakumar, was injured in an accident on December 2, 2014 while a passenger in a motor vehicle. She sought accident benefits from Aviva Canada Inc. ("Aviva"), payable under the Schedule.1 The parties were unable to resolve their disputes through mediation, and Mrs. Rajendrakumar applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c. I.8, as amended.
The issues set out as agreed in the Pre-Hearing report dated November 23, 2016 are as follows:
Is Mrs. Rajendrakumar entitled to receive a weekly income replacement at a rate of $400 per week for the period from November 5, 2015 to date and ongoing? Is Aviva entitled to a repayment of $18,914.29 of income replacement benefits during the period from December 9, 2014 to November 4, 2015?
Is Ms. Rajendrakumar entitled to receive medical benefits for services provided by Scarborough Rehabilitation Clinic in the following amounts:
- $1696.30 for physiotherapy, treatment plan dated July 13, 2015; and
- $1982.40 for chiropractic treatment, treatment plan dated May 12, 2015?
Is Mrs. Rajendrakumar entitled to payments for the cost of examinations in the amount of $1726.50 for an in-home assessment provided by Scarborough Rehabilitation Clinic dated August 8, 2015?
Is Aviva liable to pay Ms. Rajendrakumar's expenses in respect of the arbitration?
Is Mrs. Rajendrakumar liable to pay Aviva's expenses in respect of the arbitration?
Is Ms. Rajendrakumar entitled to interest for the overdue payment of benefits?
Result:
All Mrs. Rajendrakumar's claims for accident benefits are dismissed.
Aviva is entitled to the reimbursement of $18,914.29 for income replacement benefits from Ms. Rajendrakumar.
The Insurer's claim, advanced at the Hearing, for interest on the repayment is dismissed.
Mrs. Rajendrakumar shall pay to Aviva the sum of $3,500.00 towards its expenses of this Arbitration.
Ms. Rajendrakumar was born in Sri Lanka in 1978 and immigrated to Canada. She was injured while a passenger in a motor vehicle accident ("MVA") on December 2, 2014 in Toronto. She claimed accident benefits in an OCF-1 Form dated January 17, 2015, listing David J. Levy as her representative.
At a Pre-Hearing conference dated November 23, 2016, Arbitrator Drory fixed the Hearing for September 13-15, 2017 and listed the issues as set out above. He also ordered the Applicant to provide certain documents to Aviva no later than March 23, 2017 (four months following the Pre-Hearing). These documents included medical records and complete employment files with salary and payroll information, T4 statements, collateral benefits file, EI/social assistance file if any, and WSIB file if any.
As of the date of the Hearing, the Applicant had failed to produce any of the information as ordered.
Preliminary Issue: Counsel's Motion for Removal from the Record
On August 1, 2017, Mr. Vella, Mr. Levy's law partner and counsel for the Applicant, wrote to ADR Chambers requesting a resumption of the Pre-Hearing in order to bring a motion to be removed as solicitors of record. ADR Chambers advised that the motion would be heard by the Hearing Arbitrator.
On August 8, 2017 Counsel for the Applicant served and filed a motion to be removed from the record on the grounds of a breakdown in the lawyer-client relationship, under Rule 9.7 of the Dispute Resolution Practice Code ("DRPC"). In support of the motion Mr. Vella served and filed an affidavit sworn by Bob Jones, a lawyer in his office stating that counsel had been unable to obtain instructions from the Applicant, that he believed there had been an irreparable breakdown in trust and confidence between their firm and the Applicant, and that he did not believe the firm could continue to act for the Applicant. He also added that the Applicant had been made aware of the firm's intention, and gave her last known address, in accordance with Rule 9.7(b) of the DRPC. ADR Chambers informed Mr. Vella that the Hearing Arbitrator would deal with the motion at the start of the Hearing on September 13, 2017.
The Hearing
The Hearing commenced at 10:00 a.m. on September 13, 2017. Participating were Mr. Vella, Ms. Nathalie Rosenthall, counsel for the Insurer, and Ms. Anne Hurl, litigation specialist at Aviva. The Applicant did not appear.
Mr. Vella addressed the tribunal, submitting a Supplementary Affidavit from Mr. Jones stating that their firm had advised the Applicant of the time and location of the Hearing by mail dated August 30, 2017.2 Mr. Vella informed me that he and a Tamil interpreter in his office had spoken to the Applicant by telephone after she received the firm's letter, and without divulging any privileged information, he was "confident that she would not be attending" the Hearing.
Being satisfied that the Applicant's counsel had fulfilled the requirements of the DRPC, and that the Applicant had actual notice of both the Insurer's reimbursement claim3 and of the arbitration Hearing, and had chosen not to attend, I granted counsel's application and permitted him to withdraw. At approximately 10:45 a.m., Mr. Vella left the Hearing room and the Tamil interpreter was dismissed.
Counsel for Aviva then requested that we proceed with the Hearing in the absence of the Applicant. The Applicant having been warned of the consequences of failure to attend by the Pre-Hearing Arbitrator in his report of November 23, 2016 and by her then counsel in August 2017, I proceeded without the participation of the Applicant.
The Law
In order to prevail in this Arbitration, the Applicant has the burden of proof under the Schedule to show on a balance of probabilities that she sustained an impairment caused by the MVA for which accident benefits are payable. On the other hand, pursuant to section 52, to obtain an Order for repayment the Insurer has the burden of proof to show on a balance of probabilities that the Applicant was not entitled to Income Replacement Benefits ("IRBs"), having wilfully misrepresented her situation to the Insurer.
The Applicant's Case
In her application for accident benefits, Mrs. Rajendrakumar claimed to have suffered injuries to her neck, shoulders, and back, as well as suffering from whiplash, pain in both arms and spinal cord, headaches, poor sleep and feeling scared and worried. She claimed medical benefits and IRBs. The Applicant filed no evidence and offered no submissions in support of her claims. She was aware of the Hearing and of the possible consequences of non-attendance, yet chose not to participate.
Evidence and Submissions from the Insurer
The Insurer paid IRBs until November 4, 2015. The Applicant failed to provide the employment documentation requested by the Insurer to support her claim, even after having been ordered to do so by the Pre-Hearing Arbitrator. The Insurer's counsel in preparing a Joint Arbitration Document Brief, included certain medical information obtained by the Applicant regarding the Applicant's injuries and complaints post-accident.4 On October 21, 2015, relying on its own medical examiners, the Insurer notified the Applicant that it had terminated IRBs on a medical basis.5 On December 17, 2015, the Insurer advised the Applicant that,
...based on the evidence collected to date, Aviva has determined that the evidence provided does not support that you were employed as reported...and that you have wilfully misrepresented facts...in relation to your claim for Income Replacement Benefits." The same letter continued, "[I]t is our intention to recover all payments made to date as per Section 52(1)(a) of the Statutory Accident Benefits Schedule. We are requesting repayment of $18,914.29 for Income Replacement Benefits paid...within 15 days from the date of this letter...
In support of its application for reimbursement, the Insurer offered affidavit evidence sworn by Aviva investigator Jessica Martin.6 The Applicant did not attempt to test that evidence.
In Part 8 of the OCF-1 application, Income Replacement Determination dated January 17, 2015,7 Mrs. Rajendrakumar listed, "2012 to present, Exclusive Car Rental, 1193 Brimley Rd. Scarborough ON M1P 3G5, as General Labour for 40 hours per week". She indicated that her injuries prevented her from working from the date of the MVA and that she had been unable to return to work since the MVA. She stated that she had had her highest average weekly income during her last 52 weeks of her work. The application contained the usual paragraph regarding false or misleading statements or representations to an insurer just over the signature line.
Ms. Martin testified in her affidavit that the Applicant's Accident Benefits Application and her Employer Confirmation indicated that she worked at two different employers on the date of the MVA. The Employer Confirmation OCF-2 8gave as the Applicant's current employer Construction Tools and Rental, at 487 Kennedy Road, Scarborough, and indicated that she had been employed there from June 9, 2014 to the date of the accident as a general worker in packaging and receiving. Thus, Aviva enlisted Ms. Martin's assistance to investigate the apparent discrepancies.
Ms. Martin's affidavit described her attendances at the two addresses given by the Applicant, where she found that other businesses were operating from those locations. Personnel at both locations denied any knowledge of either Exclusive Car Rental or Construction Tools. The telephone numbers given for the Applicant's employer contacts were fruitless. One was no longer in service and the other apparently belonged to a person named Matt whose number the Applicant had provided in a statutory declaration. "Matt" never returned Ms. Martin's call.
Ms. Martin examined the Applicant under oath on November 18, 2015.9 At that time, Ms. Rajendrakumar maintained that she worked at Construction Tools on the date of the loss, and that she and other employees had to access their warehouse by walking through the Spa which occupied the 487 Kennedy Road location. She said she was paid by cheque, but failed to produce any cheques, pay stubs, T4s or other proof of her employment. She testified that her original reference to Exclusive Car Rentals was an error, that she had listed Exclusive Car Rentals because she had worked there for a longer period than with her current employer. There is no evidence that either she or her counsel attempted to rectify that error after the Examination under Oath.
Ms. Martin contacted the owner of the Spa by telephone, who informed her that she had operated out of 487 Kennedy Road for approximately 3 years and that employees of Construction Tools did not access their warehouse via the Spa.
Conclusion
There being unsupported and untested contradictory medical evidence from both parties, I find that the Applicant has failed to prove on a balance of probabilities that she was entitled to the accident benefits claimed in this arbitration. Consequently, her claims must be dismissed.
With respect to the Insurer's claim for reimbursement of IRBs, Counsel for the Insurer invited me to draw a negative inference in light of:
- the Applicant's failure to provide any documentary evidence to corroborate her assertion that she had been employed at the time of the accident;
- the clear discrepancy between the OCF-1 and the OCF-2 information regarding employers;
- the discrepancy between her sworn testimony and the information obtained from independent third parties at the two locations where she claimed to have been employed;
- her own counsel's application to be removed on the grounds of a breakdown of solicitor and client relationship and trust; and
- the Applicant's failure to appear at the Hearing.
In light of these factors, even without a negative inference, I find that the Applicant has failed to prove on a balance of probabilities that she is entitled to IRBs, or indeed any accident benefits claimed. Even if one assumed that her original misinformation had been inadvertent, she made no attempt to rectify the error by advising the Insurer of her true employment history. I find that the Insurer has proven on a balance of probabilities that the Applicant provided false information regarding her work history.
I find that the Applicant has wilfully misled the Insurer, wrongly causing it to pay her IRBs. It follows that under section 52 of the Schedule, the Applicant is by her misrepresentation disentitled to those benefits, and that she must repay them to the Insurer.
The Insurer's demand for repayment of the IRBs included a demand for interest from December 30, 2015.10 The Schedule provides for interest to run on overdue payments, making no mention of interest on overpayments or reimbursed payments. Counsel did not present any legal authority for an award of interest, nor am I award of any legal basis for such an award in this case. The claim for interest on the $18,914.29 fails.
Expenses
The Insurer having prevailed in this Arbitration, I find that it is entitled to its reasonable costs of the Arbitration. Having considered the Insurer's Bills of Costs and oral submissions on costs delivered to me at the Hearing of this matter, I fix those costs in the amount of $3500.00.
October 31, 2017
Louise Barrington Arbitrator
Date
ARBITRATION ORDER
Neutral Citation: 2017 ONFSCDRS 287 FSCO A16-002157
BETWEEN
PRABHA RAJENDRAKUMAR Applicant
and
AVIVA CANADA Insurer
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:
All Mrs. Rajendrakumar's claims for accident benefits are dismissed.
The claim of Aviva for the reimbursement of $18,914.29 of income replacement benefits is granted. Ms. Rajendrakumar shall pay to Aviva the sum of $18,914.29.
The Insurer's claim, advanced at the Hearing, for interest on the repayment, is dismissed.
Mrs. Rajendrakumar shall pay to Aviva the sum of $3,500.00 towards its expenses of this Arbitration.
October 31, 2017
Louise Barrington Arbitrator
Date
Footnotes
- The Statutory Accident Benefits Schedule, Ontario Regulation 34/10 – Effective September 1, 2010.
- Ex. 3, Supplementary Affidavit of Bob Jones with copy of letter to Applicant dated August 30, 2017.
- Ex. 1 v.1, Tab 18.
- Ex.1 v.1, Tabs 29 and 31.
- Ex. 1 v. 2, Tab 33.
- Ex. 1 v. 1, Tab 27.
- Ex. 1 v.1, Tab 1.
- Ex. 1 v.2 Tab 39
- Ex. 1 v. 2, Tab 36, in particular pp. 53-68.
- Ex. 1 v. 2, Tab 18, p. 2.