17-001315 v Royal Sun Alliance Insurance, 2017 CanLII 99140

Date: 2017-12-11

Tribunal File Number: 17-001315/AABS

Case Name: 17-001315 v Royal Sun Alliance Insurance

In the matter of an Application for Dispute Resolution pursuant to subsection 280(2) of the Insurance Act, RSO 1990, c I.8., in relation to statutory accident benefits.

Between:

Applicant

Applicant

and

Royal Sun Alliance Insurance

Respondent

DECISION

ADJUDICATOR: Gemma Harmison

Written Submissions by:

For the Applicant: Kiro Soliman, paralegal

For the Respondent: Sam Brach, counsel

Written Hearing: July 5, 2017

OVERVIEW:

1On October 12, 2016, C.H. (“applicant”) sustained soft tissue injuries to his neck, shoulders, elbow, chest and back when another vehicle reversed into his in a shopping plaza parking lot. The applicant sought benefits from the respondent, Royal Sun Alliance Insurance (“RSA”), pursuant to the Statutory Accident Benefits Schedule - Effective September 1, 2010 (“Schedule”).

2The respondent refused to pay for medical treatments proposed in a Treatment and Assessment Plan (OCF-18) dated January 26, 2017, and the applicant applied to the Licence Appeal Tribunal - Automobile Accident Benefits Service (“Tribunal”) for resolution of the dispute.

3The position of the respondent is that it is not required to pay for the treatment claimed by the applicant on two grounds. The first is that that the applicant’s accident-related injuries are predominantly minor in nature and subject to the treatment cap of $3,500 under the Minor Injury Guideline (“MIG”). The second reason is that the proposed treatment plan is not reasonable and necessary in relation to the applicant’s accident-related injuries.

4The applicant submits that he is entitled to the treatment claimed for three reasons. The first is that the respondent is precluded from taking its position on the application of the MIG because it failed to comply with section 38 of the Schedule. The second is that he contends that he has pre-existing psychological and physical conditions which should remove him from the application of the MIG. Finally, he further asserts that the proposed treatment plan is reasonable and necessary.

ISSUES TO BE DECIDED:

5Having reviewed the evidence and the submissions of the parties, I have determined the issues in dispute to be as follows:

i. Did the respondent fail to comply with section 38(8) of the Schedule, such that per section 38(11)1 of the Schedule, the respondent is prohibited from taking the position that the applicant is subject to the MIG?

ii. If the answer to the first question is yes, then I need not make a determination on whether the applicant’s injuries are predominantly minor in nature and subject to the MIG limit, since section 38(11)1 is a complete answer to that question and the respondent would be prohibited from taking the position that the applicant is subject to the MIG.

iii. If the answer to the first question is no, then I must decide:

(a) Are the applicant’s injuries predominantly minor injuries as defined in the Schedule, subject to a treatment cap of $3,500.00 and to treatment within the MIG?

iv. Is the applicant entitled to a medical benefit for chiropractic services in the amount of $3,687.81 recommended by Whitby Physiotherapy and Rehabilitation Clinic Inc. in a treatment plan dated January 26, 2017, and denied by the respondent on February 8, 2017?

v. Is the applicant entitled to interest on any overdue payment of benefits?

vi. Is either party entitled to costs of the proceeding?

RESULT:

6For reasons set out below, I find that:

i. The respondent failed to respond to the applicant within the statutorily mandated time per section 38(8) of the Schedule and as such per section 38(11)1, the respondent is prohibited from maintaining its position that the applicant is subject to the MIG.

ii. Since no treatment was actually incurred by the applicant during the period prescribed by section 38(11)2 of the Schedule, no benefit is payable for that period.

iii. The applicant is not otherwise entitled to the treatment plan in dispute, as I have determined that the applicant has failed to prove that the proposed treatment is reasonable and necessary for injuries directly attributable to the motor vehicle accident;

iv. Since no benefits are deemed owing, the applicant is not entitled to interest;

v. Neither party is entitled to costs of the proceeding.

ANALYSIS:

Did the Respondent Comply with Section 38 of the Schedule?

7Sections 38(8), (9) and (11) of the Schedule set out strict notice requirements for insurers responding to treatment plans, with specific consequences if they fail to comply. Under section 38(8), the insurer must notify the insured person within 10 business days whether it will pay for the goods and services requested. If it refuses to pay for them, it must state the medical and other reasons why it considers the goods and services not to be reasonable and necessary. Section 38(9) further requires that if the insurer takes the position that the MIG applies, it must include that information in the notice. Per Section 38(11), if an insurer fails to comply with any of these requirements, it is prohibited from taking the position that the MIG applies and must pay for any incurred treatment expenses until such time that it gives proper notice.

8The applicant submitted a copy of the treatment plan in dispute in his evidence for the hearing¹. The treatment plan is dated January 26, 2017. In his submissions, the applicant states that the treatment plan was submitted to the respondent on or about the same date. The respondent has provided no evidence to contradict the applicant’s assertion so as to persuade me otherwise. Accordingly, I find on a balance of probabilities that the treatment plan was submitted to the respondent on January 26, 2017, which was a Thursday. Since section 38(8) of the Schedule mandates an insurer to respond within 10 business days, in the present case notice to the applicant was required by February 9, 2017.

9I find the respondent did not provide the applicant with notice of its refusal to pay for the treatment claimed within 10 business days as required by section 38(8). The respondent first sent a letter to the applicant, by regular mail, dated February 8, 2017². In this letter, the respondent acknowledged receipt of the treatment plan dated January 26, 2017 and advised the applicant that it was not approving it. The letter went on to state the respondent’s belief that the MIG applied, that it would be arranging for an Insurer Examination (IE) and that further details regarding the IE would follow.

10The respondent then sent a second letter addressed to the applicant dated February 13, 2017³, and a copy of that letter was also sent via facsimile to the applicant’s legal representative on the same date. In this letter, the respondent restated its belief that the MIG applied and that an IE was required. The letter confirmed that the IE would be conducted in-person, the applicant’s attendance was required, and enclosed with the letter was a copy of the IE Notice of Assessment.

11The applicant contends that the respondent failed to comply with the 10-day notice requirement mandated under section 38(8) of the Schedule. The applicant asserts that neither the respondent’s letter of February 8, 2017 (sent by regular mail) nor its letter of February 13, 2017 (sent by regular mail to the applicant and by facsimile to the applicant’s legal representative) meet the 10-day notice requirement. In support of his position, the applicant relies on the Tribunal’s decision in R.H. v. TD Insurance Meloche Monnex⁴. In that case, Adjudicator Leslie determined that where a response is sent by regular mail, “generally 5 days are allowed for such delivery” and as such the issue date is “reasonably understood to be 5 business days later”. Asserting that the same approach should be adopted in the present case, the applicant contends that the respondent’s letter of February 8, 2017 (which was a Wednesday), sent via regular mail, would have been received by the applicant 5 business days later on Wednesday February 15, 2017, which is beyond the 10 business days mandated by section 38(8). The applicant further submits that the respondent’s letter of February 13, 2017, sent via facsimile, is also beyond the 10 business days mandated by section 38(8). I agree.

12Although Adjudicator Leslie’s determination, that generally 5 business days are allowed for delivery of a notice sent by regular mail (such that the issue date is reasonably understood to be 5 business days later), is not altogether binding in terms of my decision in the present case, I find it to be reasonable and I adopt the same approach. Accordingly, I find that the respondent’s letter of February 8, 2017, sent by regular mail and allowing 5 business days for delivery, was issued to the applicant on February 15, 2017, which is outside the ten day notice requirement.

13I reject the respondent’s submission that an explanation for the delay should excuse it from the consequences. The respondent asserts that its representative spoke with the applicant’s legal representative by telephone on February 3, 2017 and informed him that the application of the MIG was at issue⁵.

14The respondent further submits that the Tribunal’s decision in R.H. v. TD Insurance Meloche Monnex is not binding and is distinguishable from the present case because Adjudicator Leslie found TD had breached section 38(8) on more than one ground: failure to comply with the 10 day notice requirement and failure to provide medical reasons. Further, the respondent submits that Adjudicator Leslie also found that TD’s failure to comply with section 38(8) compromised R.H.’s ability to seek early treatment whereas in the present case the applicant has extended collateral benefits available to him such that the applicant’s ability to seek early treatment was not compromised.

15Although I agree that the respondent provided adequate medical reasons in this case, I do not find the respondent’s submissions convincing or persuasive as to its explanation for the delay in sending its notice letter dated February 8, 2017 or that its representative’s telephone call with the applicant’s legal representative on February 3, 2017 constitutes proper notice in respect of the issue of the MIG. Verbally informing the applicant’s legal representative during a telephone call that the MIG was an issue does not meet the requirement of providing notice as mandated by section 38(8).

16I also disagree with the respondent’s assertion that R.H. v. TD Insurance Meloche Monnex is distinguishable from the present case. Section 38(8) of the Schedule makes clear that notice by the insurer may be deemed non-compliant if it is made outside the 10 business day requirement, fails to provide medical or other reasons, or fails to state its position that the MIG applies as required by section 38(9).

Failure of the insurer to meet any one of those three requirements is sufficient for a determination of non-compliance. Further, the fact that an applicant has extended collateral benefits coverage does not excuse an insurer from its obligation to comply with section 38(8).

17I find that the respondent failed to comply with the 10 day notice requirement and, as per section 38(11)1 of the Schedule, the respondent is therefore prohibited from taking the position that the applicant is subject to the MIG.

18Further, this invokes the mandatory payment provisions of 38(11)2 of the Schedule. Under section 38(11)2, the respondent is liable for payment of the costs of treatment incurred on the 11th business day after the day the insurer received the treatment plan and ending on the day the insurer gives a notice described in subsection (8). As noted, I have found that the respondent received the treatment plan on January 26, 2017 and that 10 business days from that date would be February 9, 2017. The respondent would therefore be liable for payment of costs of treatment incurred for the period covering February 10, 2017 (the 11th business day) up to and including February 14, 2017 (February 15th being the date the insurer is deemed to have given the mailed denial notice).

19However, as confirmed by the applicant⁶, he did not incur any treatment under the treatment plan during the period for which the respondent would be liable from February 10, 2017 up to and including February 14, 2017. Therefore, although the respondent would be liable for payment of costs of treatment incurred for the period prescribed per section 38(11)2, since the applicant did not incur treatment during that time, no benefit is ordered payable for that period.

Is the applicant otherwise entitled to the treatment plan in dispute? Is the treatment plan reasonable and necessary?

20The onus rests with the applicant to prove, on a balance of probabilities, that the services proposed in the disputed treatment plan are reasonable and necessary.

21Having reviewed the treatment plan and other evidence submitted for this hearing as well as the submissions of the parties, and for reasons that follow, I find that the applicant has failed to meet that onus, and has failed to prove that the treatment plan is reasonable and necessary for injuries directly attributable to the motor vehicle accident. It is not clear from the treatment plan whether the proposed services are intended to treat the applicant’s accident-related injuries versus an unrelated injury that he suffered subsequent to the motor vehicle accident.

22Details of the accident and the applicant’s injuries are found in his OCF-1 (Application for Accident Benefits)⁷, and an IE report⁸ prepared in connection with applicant’s in-person IE examination on April 25, 2017. I accept the applicant’s account as reported in these documents, that on October 12, 2016 another vehicle reversed into his vehicle while it was parked in a shopping plaza, and that as a result he suffered pain in his shoulders, arms, elbow, chest and back. I accept his report that since he had been reaching back with his right arm at the time of impact, he injured his right shoulder. Police attended the scene but paramedics did not.

23The applicant drove home in his vehicle and did not seek medical attention until he saw his family doctor on October 20, 2016, 8 days later.⁹ The doctor noted mild right-sided paravertebral and parascapular tenderness, provided a diagnosis of musculoskeletal sprain/muscle strain, and suggested that the applicant start physical therapy.

24On November 12, 2016 (one month post-accident) the applicant tripped while inside a comedy club¹⁰, resulting in a fracture to his left humerus. He attended hospital, was assessed by an orthopaedic surgeon, and was treated with a sling. He saw his family doctor six days later on November 18, 2016¹¹ at which time his doctor noted that the applicant was still experiencing pain and would be following up again with the orthopaedic surgeon. The next and final entry in the family doctor’s clinical notes and records provided for the hearing is dated January 24, 2017¹². The entry notes “Lt Shoulder pain cont. [continues]. Unable to sleep”. It also notes that the applicant reported new pain in the left forearm area and that he had discussed this with the orthopaedic surgeon. Neither the November 18, 2016 entry nor the January 24, 2017 entry contains any reference to the motor vehicle accident or any motor vehicle accident-related physical complaints.

25The sling was removed at some point in January 2017 and the applicant reported that he continued to have pain and reduced range of motion in his left shoulder¹³. The ongoing complaint of pain was in his left shoulder which was injured during the trip/fall incident, not the right shoulder injury caused by the car accident.

26The treatment plan in dispute submitted by the chiropractor at Whitby Physiotherapy and Rehabilitation Clinic, dated January 26, 2017, proposed the following services:

• 24 rehabilitation sessions to be provided by a chiropractor;

• 12 massage therapy sessions to be provided by a massage therapist;

• Biofreeze; and

• Completion of OCF-18

27The information contained in the treatment plan is problematic in terms of establishing that the proposed treatment is reasonable and necessary as a direct result of the applicant’s accident-related soft tissue injuries. First, the treatment plan listed the fractured humerus as being an injury directly related to the motor vehicle accident. Although elsewhere in the treatment plan it was later noted that the fractured humerus was sustained a month after the accident, it goes on to state that the applicant’s accident-related injuries were “aggravated” on account of the applicant having to wear a sling without providing further specifics or particulars in that respect. Finally, the treatment plan does not delineate whether the identified goals of pain reduction, increased strength and increased range of motion all are in reference to the applicant’s fractured humerus. Certainly the “other” goal that was identified – specified as “assist full healing of fracture” – clearly was specific to that injury which was unrelated to the car accident.

28I find that the applicant has failed to prove that the treatment plan is reasonable and necessary as a direct result of his motor vehicle accident-related injuries, and therefore find that he is not otherwise entitled to the treatment plan in dispute.

Costs

29Rule 19.1 of the Tribunal’s Rules of Practice and Procedure (“Rules”) provides that a party may make a request to the Tribunal for costs where it believes another party in a proceeding has acted unreasonably, frivolously, vexatiously, or in bad faith [emphasis added]. Rule 2.17 of the Rules defines a “proceeding” as being “the entire Tribunal process from the start of an appeal to the time the matter is finally resolved”.

30Rule 19.4 further sets out a requirement that a party’s submission on costs shall “set out the reasons for the request and the particulars of the other party’s conduct that are alleged to be unreasonable, frivolous, vexatious, or in bad faith.”

31In his submissions, the applicant asserts that the respondent acted in an unreasonable manner and with bad faith by failing to do a “simple date calculation” and by not responding to the treatment plan within 10 business days. That happened before the application was made to the Tribunal, not in the proceeding before the Tribunal.

32The respondent also claimed for costs but in its submissions identified no improper conduct by the applicant in the proceeding before the Tribunal.

33I find that neither party has in their respective submissions identified any conduct by the other party in the proceeding before the Tribunal that would warrant an order of costs under Rule 19.

CONCLUSION:

34For the reasons set out above, I find that:

i. The respondent failed to respond to the applicant within the statutorily mandated time per section 38(8) of the Schedule and as such per section 38(11)1 the respondent is prohibited from maintaining its position that the applicant is subject to the MIG.

ii. Since no treatment was actually incurred by the applicant during the period prescribed by section 38(11)2 of the Schedule, no benefit is payable for that period.

iii. The applicant is not otherwise entitled to the treatment plan in dispute, as I have determined that the applicant has failed to prove that the proposed treatment is reasonable and necessary for injuries directly attributable to the motor vehicle accident;

iv. Since no benefits are owing, the applicant is not entitled to interest;

v. Neither party is entitled to costs of the proceeding.

Footnotes

1. 1Applicant’s Submissions, Tab 3.
2. 2Applicant’s Submissions, Tab 5.
3. 3Applicant’s Submissions, Tab 4.
4. 4R.H. v. TD Insurance Meloche Monnex, 2017 CanLII 1555 (ON LAT), Applicant’s submissions Tab 6.
5. 5As per the adjuster’s log notes, Respondent’s Submissions, Tab 13.
6. 6Applicant’s submissions at paragraph 5.
7. 7Applicant’s submissions, Tab 1
8. 8Respondent’s submissions, Tab 2
9. 9Clinical notes and records (“CNR’s”) of Dr. R. Mohan, Applicant’s submissions, Tab 2, page 3
10. 10IE Report of Dr. A Belfon Respondent’s submissions, Tab 2 page 3
11. 11CNRs of Dr. Mohan, Applicant’s submissions, Tab 2, page 2
12. 12CNRs of Dr. Mohan, Applicant’s submissions, Tab 2, page 1
13. 13IE Report of Dr. A. Belfon, Respondent’s submissions, Tab 2, page 3