LICENCE APPEAL TRIBUNAL
Safety, Licensing Appeals and Standards
Tribunals Ontario
Tribunal File Number: 16-000060/AABS
In the matter of an Application pursuant to subsection 280(2) of the Insurance Act, RSO 1990, c I.8, in relation to statutory accident benefits
Between:
TD General Insurance Company
Applicant
and
A. B.
Respondent
DECISION
Adjudicator: Avvy Go
Appearances:
Applicant: TD General Insurance Company
Counsel for Applicant: Anthony Gatensby
Heard In Writing: September 29, 2016
REASONS FOR DECISION AND ORDER
This is an Application by the Insurance Company to the Licence Appeal Tribunal - Automobile Accident Benefits Service (the “Tribunal”) for the resolution of a dispute in respect of an insured person’s entitlement to statutory accident benefits.
The Tribunal received submissions from the applicant only. The respondent did not provide the Tribunal with submissions, notwithstanding repeated attempts to contact the respondent since the application was filed. Specifically, the Tribunal has sent and resent the Notice of Case Conference for the case conference originally scheduled on June 20, 2016, followed by the Case Conference order and report, a further notice about the resumption of the Case conference, and finally the Notice of Written Hearing. The parties were advised of the Tribunal’s practice that the Tribunal would proceed in the absence of the parties’ submissions and participation in the hearing.
OVERVIEW
The applicant, TD General Insurance Company (“TD”) seeks an order from the Tribunal for an overpayment of income replacement benefits (IRB) from February 20, 2014 to May 22, 2014 inclusive. The applicant submitted that the respondent returned to work on February 20, 2014 without notifying the applicant, and as a result received an overpayment of IRB. As noted above, the Tribunal did not receive any submissions from the respondent.
For reasons set out below, the Tribunal directs the respondent to repay the IRB he received between May 1, 2014 and May 22, 2014 inclusive. The Tribunal further directs the respondent to pay interest of 1 per cent on the overpayment amount commencing June 6, 2014 to the date the overpayment is repaid in full.
BACKGROUND
The respondent, A.B. was injured in a motor vehicle accident on December 25, 2013. The respondent could not work because of the accident, and claimed an IRB from the applicant. At the time of the accident, the respondent worked for a bakery.
The OCF-2 indicated the respondent’s earnings in the four weeks pre-accident to be $3,051.15. Based on this amount, the respondent’s weekly IRB payable was calculated to be $400, based on a gross annual income of approximately $39,664.95. The applicant paid the respondent an IRB at the rate of $400 per week accordingly.
The respondent eventually returned to work, a fact the applicant first became aware of when the respondent submitted an OCF-3 dated May 1, 2014. The applicant continued to pay the IRB until May 22, 2014.
The applicant then sent a notice of repayment to the respondent on May 22, 2014 seeking repayment of all IRBs paid after February 20, 2014 in the amount of $5,085.71, plus interest.
THE LAW
Section 52(1)(a) of the Statutory Accident Benefits Schedule, Effective September 1 2010 (the “Schedule”) provides that an insured person shall repay to the insurer any benefit that is paid as a result of an error on the part of the insurer, the insured person or any other person, or as a result of wilful misrepresentation or fraud. Subsection 52(1)(b) provides that an insured person shall repay to the insurer any IRB that he or she was disqualified from receiving.
Section 52(3) states that the obligation to repay does not apply unless a notice, as prescribed by s. 52(2), is given within 12 months after the payment was made.
ISSUES
- The main issue in this application is as follows:
Is the respondent liable to repay the alleged overpayment of IRB from February 20, 2014 to May 22, 2014 inclusive, plus interest in the amount of $5,085.71?
- The sub-issues are as follows:
When did the respondent return to work?
Did the applicant provide notice to the respondent as prescribed by section 52(3) of the Schedule?
ANALYSIS
When did the respondent return to work?
I must first determine if there was an overpayment of IRB in this case. This requires me to determine when the respondent returned to work.
The applicant takes the position that the respondent returned to work on February 20, 2014.
The applicant submits two documents in support of its position: an OCF-3 dated May 1, 2014 and a witnessed but unsworn statement signed by A.M., the human resources manager at the bakery dated July 25, 2016.
In her statement, A.M. notes:
I only started working for [the bakery] in May, 2015. I did not know [A.B.] at all when he was involved in his accident.
A.M. went on to describe the respondent’s position at the bakery at the time of her statement, which was the same as at the time of the accident.
A.M.’s statement also describes the respondent’s job duties and usual work hours. With respect to the issue of when the respondent returned to work after the accident, the HR manager stated:
[A. B.] was first hired by our company on Nov 21, 2013. He only started about one month before this accident. [A. B.] would have been on a 3 month probationary period at the time of this accident. The only time [A. B.] took time off from work or was absent [was] from December 24, 2013 to February 20, 2014 due to the car accident he was involved in. He returned to his regular duties on February 20, 2014.
The OCF-3 dated May 1, 2014 noted, under Part 6 - Disability Tests and Information - stated that “the patient has returned to work despite symptom aggravation” although it also confirmed that the respondent suffered from “a complete inability to carry on a normal life”, and that he suffered from “substantial inability to perform housekeeping and home maintenance services” for an estimated period of 9 to 12 weeks. The OCF-3 did not, however, provide the actual date when the respondent returned to work.
The applicant is requesting this Tribunal to find that the respondent had returned to work on February 20, 2014, as per the statement provided by the HR Manager.
In reviewing the statement provided by A.M., which was witnessed but not sworn, I note that the HR Manager herself admits that she only started working for the bakery in May, 2015 and did not know A. B. at all when he was involved in his accident. A.M. appears to be referring to the bakery’s “work record” when she prepared the statement, but did not provide a copy of such a work record, if one did exist, along with her statement.
While recognizing that pursuant to section 15(1) of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22, the Tribunal can admit a hearsay statement, I must still assess the appropriate weight to be attached to such a statement. I further note that the applicant did not provide any explanation as to why it could not provide a statement from another manager or staff of the bakery who had direct knowledge of the respondent’s work history at the relevant time.
I am therefore being asked to make a finding of fact based on evidence for which reliability is in question. There is insufficient evidence, in my view, to find that the respondent had returned to work on February 20, 2014. I find the unsworn statement of a HR manager who had no direct knowledge of the respondent’s work history unreliable. Other than this statement, the applicant has not provided me with any other evidence establishing the respondent’s return to work date, even though the applicant has the burden of proving when the respondent returned to work.
As the respondent did not present any evidence to challenge the applicant’s position, the only evidence before me with respect to the respondent’s position in this regard, can be found in the OCF-3, in which the respondent reported that he had returned to work. The same OCF-3 however, also noted ongoing issues faced by the respondent, including a complete inability to carry on a normal life, and that he suffered from “substantial inability to perform housekeeping and home maintenance services” for an estimated period of 9 to 12 weeks.
While noting that the OCF-3 is itself based on the respondent’s self-report and is hearsay, I find the OCF-3 to be more reliable as the OCF-3 was prepared by a health professional as part of the ongoing assessment of the respondent’s eligibility for benefits.
Based on all the evidence before me, I find that the respondent had returned to work by May 1, 2014. There is insufficient evidence to determine how soon before May 1, 2014 he had returned to work. As such, May 1, 2014, the date of the OCF-3, is the earliest date for the respondent’s return to work that can be established on the evidence.
Did the Applicant provide notice to the Respondent as prescribed by the Regulations?
- Section 52(3) of the Schedule states that the obligation to repay an overpayment does not apply unless a notice, as prescribed by section 52(2), is given within 12 months after the payment was made. Specifically, s.52(2) requires the insurer to:
give the person notice of the amount that is required to be repaid; and
if the person is receiving an income replacement or caregiver benefit, give the person notice that the insurer intends to collect the amount by reducing each subsequent payment of the benefit by up to 20 per cent of the amount that would otherwise be the amount of the benefit.
- In their attempt to pursue the repayment of the IRB, the applicant has written numerous letters to the respondent. In each of these letters, the applicant noted as follows:
In accordance with Section 52 of the Statutory Accident Benefits Schedule, a person is liable to repay to the insurer, any benefit that is paid to that person as a result of an error on the part of the insurer, insured person or any other person, or as a result of wilful misrepresentation of fraud.
We confirm the following overpayment on your claim.
As you did not inform us of your return to work, we continued to pay an Income Replacement Benefit after February 20, 2014. A total of $5,085.71 was paid following your return to work.
As a result of this overpayment, you are responsible to repay TD Insurance a total of $5,085.71 for benefits that we have paid out on this claim.
Please contact us as soon as possible to discuss possible repayment options.
As stated in our original notice, interest now applies at the posted bank rate.
Each of these letters ended by providing the respondent with a contact person’s information.
These letters from the applicant clearly set out what they were seeking from the respondent, in addition to providing the respondent an opportunity to respond. It also notified the respondent the amount that the applicant is seeking from him. The first of these letters was dated May 22, 2014, well within the 12 month notice period. As such, I find that the notices provided by the applicant, conform to the statutory requirements outlined under s.52(2) of the Schedule.
The only issue for me to consider is whether or not the applicant had sent the notice to the correct mailing address.
The applicant sent more than 10 notices to the respondent between May 22, 2014 and February 12, 2016, all of which contained information about the alleged overpayment of $5085.71 in IRB and the applicant’s request for repayment.
The first few letters were addressed to the respondent’s mailing address as provided by the respondent in the OCF-3 dated May 1, 2014. All of these letters were also copied to Pryce & Pryce, LLP, counsel for the respondent.
More than a year after the first notice of overpayment was sent out, a letter dated June 1, 2015, was sent from Pryce & Pryce LLP to the applicant, stating that the mailing address used by the applicant was incorrect. Counsel for the respondent then provided an alternative address for the respondent.
The applicant then sent their subsequent notices to the alternative address provided by the respondent’s counsel beginning in July, 2015, until February, 12, 2016. The applicant continued to copy Pryce & Pryce, LLP, on these subsequent notices.
While it may be argued that the respondent did not receive proper notice of the overpayment within 12 months as those notices might have been sent to the wrong address, I note however that the mailing address used by the applicant to notify the respondent was the same address provided by the respondent in the OCF-3 dated May 1, 2014. If the respondent had indeed moved and his address had changed, it was up to the respondent to inform their insurer of such a change.
I further note the applicant has copied the respondent’s counsel on all of their notices throughout. Indeed, it was the respondent’s counsel who had notified the applicant that a wrong address had been used for their client. Clearly, the respondent’s counsel must have received the notices sent by the applicant, yet they did not explain in their letter dated June 1, 2015 why they had not notified the applicant sooner about the error with their client’s address.
Based on the totality of the evidence, I therefore find that the applicant did provide the requisite notice to the respondent with regard to the overpayment.
Conclusion
- Having found the respondent had returned to work on May 1, 2014, the Tribunal thus finds that there is an overpayment of IRB from May 1, 2014 to May 22, 2014 inclusive. Based on the weekly rate of $400, the respondent was overpaid by 22 days, and the overpayment amount is therefore $1,257.14.
ORDER
Pursuant to the authority vested in it under the provisions of the Act, the Tribunal directs A. B. to repay TD General Insurance Company benefits he received between May 1, 2014 and May 22, 2014 inclusive in the amount of $1,257.14.
Pursuant to section 52(5) of the Schedule, the insurer may charge interest on the outstanding balance of the amount to be repaid for the period starting on the 15th day after the notice is given and ending on the day repayment is received in full, calculated at the bank rate in effect on the 15th day after the notice is given. The first notice was given on May 22, 2014. As such, interest begins to accumulate on June 6, 2014. The applicant submitted that the bank rate in effect at the time was 1 percent per annum.
Unlike s.51 of the Schedule dealing with overdue payments from insurers, s.52(5) is silent on whether the interest is to be simple interest or compound interest. It is also silent on the compounding period. Without a clear mandate from the Legislature mandating a higher rate of interest, the Tribunal finds that the applicable interest is simple interest.
As such, the Tribunal directs A.B. to pay interest of 1 per cent per annum, calculated on simple interest, on the overpayment amount commencing June 6, 2014 to the date the overpayment is repaid in full.
Released: December 7, 2016
Avvy Go
Adjudicator