Economical Mutual Insurance Company v. E. M., 2018 CanLII 13147

Date: 2018-01-11

Tribunal File Number: 17-002716/AABS

Case Name: 17-002716/AABS v Economical Mutual Insurance Company

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:

Economical Mutual Insurance Company

Applicant

and

E. M.

Respondent

DECISION

Adjudicator: Sandeep Johal, Adjudicator

Appearances:

For the Applicant: Shalini M. Thomas, Counsel

For the Respondent: No one appeared for the Respondent

Heard in writing on: November 14, 2017

OVERVIEW

1The respondent (“E.M.”) was involved in a motor vehicle accident on August 3, 2015 and sought benefits from the applicant pursuant to the Statutory Accident Benefits Schedule – Effective September 1, 2010 (the “Schedule”). The applicant, (“Insurer”) paid income replacement benefits (“IRB”) to the respondent.

2The Insurer believed that E.M. misrepresented her employment status by stating that she was working, when according to the Insurer she was not employed and therefore not entitled to an income replacement benefit. The Insurer filed this application with the Tribunal seeking a repayment of the income replacement benefit that has been paid to E.M.

3A case conference was conducted on July 6, 2017, but E.M., who is self-represented, did not attend. The case conference was adjourned and rescheduled to August 4, 2017. At the second case conference E.M. was again not present and the case conference proceeded in her absence. At the request of the Insurer, the matter was set for a written hearing on the repayment issue. The Tribunal provided Notice of the case conferences and the hearing to E.M.’s address. The Insurer also served its submissions at E.M.’s place of residence by way of courier, and provided proof of service by way of a certificate of service.

4The repayment issue is now before me. The Insurer filed written submissions however E.M. did not file any submissions or evidence with the Tribunal for the purposes of this hearing.

ISSUE IN DISPUTE

5The Insurer submits the issues in dispute are as follows:

i. Is E.M. liable to repay the insurer the $21,600 in income replacement benefits she received from the insurer?

ii. Is E.M. liable to pay $571.78 for the cancellation fees incurred as a result of E.M.’s non-attendance at an Examination Under Oath (the “EUO”) scheduled to proceed on August 16, 2017 and August 26, 2017?

RESULT

6Based on the written submissions and evidence before me I find that the Insurer is not entitled to a repayment of the income replacement benefits paid, and

7I find that the Insurer is not entitled to be reimbursed for the cancellation fees incurred for non-attendance at the EUO.

LAW

8Section 52 of the Schedule states that a person is liable to repay the insurer any benefit that is paid to the person 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.¹

9The insurer must give notice within 12 months after the payment is made otherwise the person ceases to be liable.² The 12 month requirement does not apply if the benefit was paid as a result of wilful misrepresentation or fraud.³

ANALYSIS

10In order to decide this issue and whether E.M. is liable to repay the IRB she received, the Insurer must satisfy me on a balance of probabilities of the following:

i. Was the income replacement benefit paid as a result of wilful misrepresentation on the part of E.M. if so, then,

ii. Was adequate notice of a repayment provided to E.M.?

I. Was the income replacement benefit paid as a result of wilful misrepresentation?

11The applicant insurer has not satisfied me on a balance of probabilities that the IRB was paid as a result of wilful misrepresentation (emphasis added).

12The date of the accident is August 3, 2015 and the Insurer paid IRB’s to E.M. from January 7, 2016 to August 9, 2016.

13On August 16, 2016 the Insurer sent a letter to E.M. that the IRB benefit is being stopped effective August 16, 2016 for failing to attend the EUO as requested.

14On December 22, 2016 the Insurer sent a notice to E.M. that in accordance with section 31(b) of the Schedule it is the Insurer’s determination that there is no IRB payable because E.M. made a misrepresentation to the Insurer to enter into the contract of automobile insurance and that E.M. provided information that is false. The notice indicated that E.M. had reported that she was employed at the time of the accident but their investigation provided information that she was not employed. This was the basis of the alleged misrepresentation.

15The Insurer has not provided me with any case law, submissions or evidence on the definition of wilful misrepresentation, which is not a defined term within the Schedule.

16Black’s Law Dictionary⁴ defines wilful as voluntary and intentional, and a voluntary act becomes wilful in law, only when it involves conscious wrong or evil purpose on the part of the actor, or at least inexcusable carelessness, whether the act is right or wrong. The term wilful is stronger than voluntary or intentional.

17Wilful, in my opinion is a subjective term and I am not satisfied on a balance of probabilities that the evidence provided by the Insurer is of a wilful misrepresentation on the part of E.M. which resulted in the Insurer paying IRB’s.

18The Insurer’s letter dated December 22, 2016 seeking a repayment relies on the following evidence to show that E.M wilfully misrepresented that she was working before the accident.

a. Clinical notes and records of E.M.’s family doctor, Dr. Sen indicating he saw E.M. as a new patient on July 31, 2015, three days before the accident, and E.M told him that she was not working but was planning to go back to work by the end of August, 2015;

b. E.M.’s accident benefits file from Aviva Insurance regarding a previous accident in November 2012 which shows that she was claiming a non-earner benefit up to January 14, 2015;⁵

c. E.M.’s statements to the insurer examination assessors from her November 2012 accident that she was not working as of January 12, 2013;⁶

d. The private investigator’s “field visits” to E.M.’s employer and an “employee/volunteer” saying she did not recognize E.M.’s name;

e. The fact that E.M. did not respond to the Insurer’s request for information in letters dated January 7, 2016, May, 3, 2016 and August 8, 2016 and August 16, 2016; and,

f. E.M.’s failure to attend at three EUO’s from August 16, 2016, August 26, 2016 and October 13, 2016.

Evidence of the family doctor

19The Insurer purported to submit evidence from E.M.’s family doctor in the form of two documents - a summary report of an interview with the family doctor prepared by the Insurer’s private investigator and signed by the family doctor, and an affidavit from the private investigator. I do not place much weight on this evidence for the following reasons. First, it is hearsay. Although hearsay evidence is permissible evidence in a Tribunal setting, in order to be accorded greater weight it should be corroborated by other evidence, such as an affidavit by the doctor or another witness. Second, the interview summary report signed by the family doctor simply reiterates the private investigator’s affidavit. There is no way to test the veracity of the document, the doctor’s signature or the doctor’s belief that the statement is true, unlike an affidavit. Finally, I find the statement refers to a visit E.M. made to her family doctor before the current accident and in my opinion it was not a wilful misrepresentation made to the Insurer in order to receive IRB’s.

Statements made to a different insurer about a previous accident

20Another basis for the alleged wilful misrepresentation are statements that E.M. made in relation to a previous accident in 2012. The Insurer asserts that E.M was receiving non-earner benefits from Aviva Insurance. (E.M’s insurance company from her 2012 motor vehicle accident). According to the Notice of Repayment letter dated December 22, 2016 E.M. stopped receiving a non-earner benefit from Aviva Insurance on January 14, 2015, which was before this current motor vehicle accident. The applicant asserts that in the OCF-2 E.M.’s employer submitted for the August 3, 2015 accident, it stated she was employed from January 12, 2013 to August 1, 2015. Part of this period would have been at the time E.M. was receiving a non-earner benefit from Aviva Insurance. It may be that the listed start date was incorrect and the date may raise some questions however it falls short of proving on a balance of probabilities that she made a wilful misrepresentation in the case before me.

21Statements E.M. made to another party before the August 3, 2015 accident and before she applied for the IRB’s from the Insurer are not, in my opinion evidence of wilful misrepresentation. These statements or representations were not made to the Insurer and the Insurer did not rely on these representations when making the decision to pay the IRB’s to E.M.

22It is my opinion that whether E.M started working on January 12, 2013 or not with her current employer is irrelevant to the issue of wilful misrepresentation.

23The Insurer submits that E.M. was not working (or perhaps did not start working) on January 12, 2013 based on her previous statements to her former insurer, her family physician and based on the private investigation. Even if the date is not accurate or she was not working, that would not invalidate E.M.’s claim for an IRB.⁷ A discrepancy in a date could be for any number of unexplained reasons and could possibly raise a credibility issue with respect to E.M. however it is not sufficient evidence of a wilful misrepresentation.

24E.M.’s motor vehicle accident was August 2015 and the Insurer is relying on information from more than two years prior to the date of the accident to support their claim she has made a wilful misrepresentation. Since the evidence predates E.M.’s eligibility for IRB’s, I find that it is not relevant. What is relevant to her eligibility for an IRB was whether she meets the eligibility test set out in the Schedule. It is not clear to me how this evidence is relevant to her current eligibility or that it amounts to a wilful misrepresentation.

Private investigator visits to E.M.’s employer

25In support of her application for an IRB, E.M. submitted to the Insurer a “Confirmation of Employment” form, or “OCF-2,” from her employer. The Insurer sent a field investigation specialist, Betty Boudreau to E.M.’s employer on June 2, 2016 and she spoke to an “employee/volunteer” who did not recognize E.M.’s name. The Insurer submitted an affidavit from Ms. Boudreau stating in paragraph 9 that the person she spoke to, had only worked there “for a few months”. This interview took place approximately 10 months post-accident. I place very little weight on this evidence as it provides no insight into whether E.M. made a wilful misrepresentation. E.M.’s OCF-2 (Confirmation of Employment) states that she has not worked at the employer since the date of the accident which was well before the “employee/volunteer” began working with the employer.

26The Insurer’s private investigator was not able to speak to the owner or manager of the employer and instead spoke to a new employee or volunteer who was not working with the employer when E.M. was working there. That could very well be the reason for the new employee or volunteer not recognizing E.M.’s name. In an event, I find that it does not amount to evidence of a wilful misrepresentation.

E.M.’s failure to provide information and non-attendance at the EUO’s.

27I do not find a failure to provide information, or non-attendance at an EUO to be evidence of wilful misrepresentation. The Insurer has other provisions to assist it in the Schedule for this type of situation.⁸

Was the IRB paid as a result of an error on the part of the Insurer or E.M or any other person?

28Section 52 allows for a repayment to the Insurer if the benefit was paid as a result of an error, however the Insurer has not provided any submissions or evidence that they are seeking a repayment as a result of an error and it is my finding that a repayment as a result of an error is not applicable to E.M.’s case.

II. Did the Insurer provide notice to the respondent as required by the Schedule?

29Having found that E.M. did not obtain IRB’s as a result of wilful misrepresentation, there is no need for me to consider whether a proper notice seeking repayment was sent.

30I will now consider whether the Insurer is entitled to be reimbursed by E.M. for non-attendance at the EUO’s.

Is E.M. liable for the cancellation fees for non-attendance at the EUO’s?

31The Insurer submits that E.M. should be ordered to repay the insurer the cancellation fees incurred when E.M. refused to attend the EUO’s However, the Insurer did not direct me to any authority which would allow me to make such an order.

32The Insurer has the onus in this case, to prove on a balance of probabilities that it is entitled to repayment of cancellation fees it incurred. The Insurer has not provided me with any evidence or submissions with respect to this portion of its claim. Accordingly the claim for a reimbursement of the non-attendance charges is denied.

CONCLUSION:

33In light of the forgoing, I find that the Insurer is not entitled to a repayment of the IRB’s and it is not entitled to a reimbursement for the non-attendance charges at the EUO’s.

34The Insurer’s claim is dismissed.

Footnotes

1. 1S.52(1)(a) of the Schedule
2. 2Section 52(2)(a) of the Schedule
3. 3Section 52(3) of the Schedule
4. 4Black’s Law Dictionary 10th Edition 2009.
5. 5A person must be ineligible for an IRB, i.e. not working, in order to be eligible for a non-earner benefit.
6. 6The date on the Employer’s Confirmation Form (OCF-2) that E.M. was employed as of January 12, 2013 up to the date of the accident.
7. 7IRB Eligibility Criteria section 5(1) 1. ii. A. of the Schedule.
8. 8Section 33(6) of the Schedule.