RECONSIDERATION DECISION
Before: D. Gregory Flude, Vice-Chair
File: 17-007215/AABS
Case Name: J.M. v. Aviva General Insurance
Written Submissions By:
For the Applicant: Michelle Arzaga, Counsel
For the Respondent: Cara L. Body, Counsel
OVERVIEW
1The respondent, Aviva General Insurance ("Aviva"), requests a reconsideration of the decision of the Tribunal dated August 1, 2018, under section 18.1 of the Licence Appeal Tribunal (LAT) Rules of Practice and Procedure, Version 1 (April 1, 2016) (hereinafter "the Rules")
2The applicant (“J.M.”) was injured in an automobile accident on August 15, 2015 and sought benefits from Aviva pursuant to the Statutory Accident Benefits Schedule – Accidents September 1, 2010, O. Reg. 34/10 (the “Schedule”). The dispute before the Adjudicator focused on the question of funding for catastrophic impairment assessments. To understand that dispute, it is necessary to first briefly review the coverage limitations in the Schedule at the relevant time.
3Section 18 of the Schedule provides for three levels of monetary limits for medical and rehabilitation benefits, depending on the severity of the impairments caused by the accident:
The first monetary limit of $3,500 applies to persons who have sustained minor injuries, a term defined in s. 3 to include soft tissue injuries such as sprains, strains, whiplash, bruises and cuts. It is not a factor in this case.
The second monetary limit, for more serious injuries, is $50,000. The parties agree that the applicant exhausted this limit.
The third and final monetary limit, for the most seriously impaired individuals, is $1 million for catastrophically impaired individuals. The term “catastrophic impairment” is defined in s. 3(2) of the Schedule. While in some cases the criteria for catastrophic impairment set out in s. 3(2) may be clear cut, such as paraplegia or quadriplegia, loss of a limb, or loss of vision in both eyes, there are other criteria that may require a multidisciplinary assessment involving several medical experts. These assessments are expensive.
4In this case, the applicant seeks $21,513.35 for a multidisciplinary assessment to determine whether she has suffered a catastrophic impairment. However, and as mentioned above, she has already exhausted the $50,000 monetary limit for those with non-catastrophic injuries. Thus, the central issue before the Adjudicator was whether the costs of a multidisciplinary catastrophic impairment assessment are included in the $50,000 limit or whether the respondent must fund such assessments in addition to paying out $50,000 for medical and rehabilitation benefits. The Adjudicator held that Aviva had to fund a catastrophic impairment assessment in addition to providing $50,000 for medical and rehabilitation benefits. The respondent seeks a reconsideration of that decision.
STANDARD OF REVIEW
5According to Rule 18.1 of the Tribunal’s Rules, Aviva is required to identify the applicable criterion for this request for reconsideration. Aviva relies on 18.2(b), which, at the relevant time, allows for a reconsideration where the Tribunal made “a significant error of law or fact such that the Tribunal would likely have reached a different decision.”
6While the reasonableness and necessity of the catastrophic assessments the applicant seeks was an issue before the Adjudicator at the hearing, the applicant did not seek reconsideration of his finding on that issue. The reconsideration was argued on a question of law only. Accordingly, the applicable Rule, Rule 18.2(b), places the onus squarely on Aviva to point to a significant error of law that impacted the decision’s outcome. Only if the Adjudicator’s interpretation of the law is significantly in error should I interfere. If his interpretation of the law shows no significant error, then his decision must be allowed to stand.
RESULT
7I find the Adjudicator did not make any significant error of law. Read as a whole, it is clear that the Adjudicator considered all of the legal issues in dispute and appropriately interpreted the statutory provisions and the case law in coming to his conclusion. Indeed, I agree with his interpretation of the Schedule that catastrophic assessments are not included in the $50,000 medical benefit limit.
ANALYSIS
8The Schedule is divided into a number of parts. Of particular interest in this matter are three sections in three different parts: s. 18 in Part III – Medical, Rehabilitation and Attendant Care Benefits, which sets out the monetary limits for medical and rehabilitation benefits as explained above; s. 25 in Part IV - Payment of Other Expenses, which establishes an insurer’s obligation to pay for the costs associated with assessments; and s. 45 in Part VIII – Procedures for Claiming Benefits, which details the process for applying for a catastrophic determination.
9The Adjudicator began his analysis with s. 18 and then moved on the consider ss. 25 and 45. He noted the monetary limit set out in s. 18(3)(a) and Aviva’s submission that that section sets the applicable monetary limit. He then addressed the wording of s. 18(5) that restricted the application of s. 18(3)(a) to assessments “in connection with any benefit or payment.” He found that that the term “in connection with” meant that assessments that come within the scope of s. 18(3)(a) were assessments related to a specific benefit or payment.
10The Adjudicator then moved to s. 25. Section 25(1)5 addresses the cost of catastrophic impairment assessments. More specifically, that section makes an insurer responsible for the payment of reasonable fees for the costs of a number of examinations, including:
- Reasonable fees charged for preparing an application under section 45 for a determination of whether the insured person has sustained a catastrophic impairment, including any assessment or examination necessary for that purpose.
11Following a discussion about the $2,000 limit on the amount the respondent is obliged to pay per assessment, he accepted the reasoning of the Financial Services Commission of Ontario in Henderson v. Wawanesa, (FSCO, Al4-001758, July 9, 2015) (“Henderson”) that “there is no room for ambiguity – the insurer shall pay the expenses of a CAT assessment.”
12The respondent argues that the Adjudicator erred in law in three respects:
a. In paragraph 14 of his Reasons, the Adjudicator interprets the phrase "in connection with any benefit or payment" as used in s. 18(5) of the SABS to mean that the consumption of med-rehab benefits by catastrophically impaired persons is not restricted, and this interpretation is clearly wrong and a significant error of law;
b. Also in paragraph 14, the Adjudicator finds that the phrase "in connection with any benefit or payment" does not include assessments unless they are directly related to a specific benefit or benefits, and this is contrary to the clear langue of the SABS and is also a significant error in law; and
c. The conclusion reached in paragraphs 16 and 1 7 is incorrect and a significant error in law as well; namely, that because s. 25 of the SABS makes the payment of catastrophic assessments by insurers in particular circumstances mandatory.
13In addressing the grounds for reconsideration, I intend to adopt a slightly different approach from that adopted by the Adjudicator, albeit without departing from his conclusions. In my view, the meaning of the Schedule is made clear by adopting the following analysis: does the Schedule create an obligation to pay for a catastrophic assessment and, if so, does it limit the amount the respondent has to pay in some manner?
14Applying this approach, it is clear that s. 25 creates an obligation on the respondent to pay expenses, including assessments. It lists five types of expenses:
a. Reasonable fees charged for preparing a disability certificate if required under section 21, 36 or 37, including any assessment or examination necessary for that purpose.
b. Fees charged in accordance with the Minor Injury Guideline by a person authorized by the Guideline for preparing a treatment confirmation form and for conducting an assessment or examination and preparing a report as authorized by the Guideline.
c. Reasonable fees charged by a health practitioner for reviewing and approving a treatment and assessment plan under section 38,including any assessment or examination necessary for that purpose, if any one or more of the goods, services, assessments or examinations described in the treatment and assessment plan have been:
i. approved by the insurer,
ii. deemed by this Regulation to be payable by the insurer, or
iii. determined to be payable by the insurer on the resolution of a dispute described in subsection 280 (1) of the Act.
d. Reasonable fees charged by an occupational therapist or a registered nurse for preparing an assessment of attendant care needs under section 42, including any assessment or examination necessary for that purpose.
e. Reasonable fees charged for preparing an application under section 45 for a determination of whether the insured person has sustained a catastrophic impairment, including any assessment or examination necessary for that purpose.
Section 25 makes no mention of the monetary limits in s. 18. The only limitations it applies are a reasonableness requirement and a cap of $2,000 per assessment. Thus, it is necessary to examine s. 18 to see if its monetary limitations apply to the respondent’s obligation to pay expenses assessments in s. 25.
15While s. 18(3) sets the monetary limits for medical and rehabilitation benefits, s. 18(5) addresses what medical and rehabilitation benefits are to be included in the monetary limit. For ease of reference, I will set out ss. 18(1), (3) & (5):
(1) The sum of the medical and rehabilitation benefits payable in respect of an insured person who sustains an impairment that is predominantly a minor injury shall not exceed $3,500 for any one accident, less the sum of all amounts paid in respect of the insured person in accordance with the Minor Injury Guideline.
(3) The sum of the medical and rehabilitation benefits paid in respect of an insured person who is not subject to the financial limit in subsection (1) shall not exceed, for any one accident,
(a) $50,000; or
(b) if the insured person sustained a catastrophic impairment as a result of the accident, $1,000,000.
(5) For the purposes of subsections (1) and (3), medical and rehabilitation benefits payable in respect of an insured person include all fees and expenses for conducting assessments and examinations and preparing reports in connection with any benefit or payment to or for an insured person under this Regulation. [Emphasis added]
16Section 18(5) is clear that the costs of assessments are included in the monetary limit of $50,000 in s. 18(3)(a) provided they are in connection with any benefit or payment. The appellant argues that a catastrophic designation is not a benefit or a payment and, instead, is an assessment aimed at determining if someone is catastrophically impaired and, therefore, is not caught by s. 18(5). Aviva that, by equating the words “in connection with any benefit or payment” with “directly related to a specific benefit or benefits,” the Adjudicator made a significant error of law.
17Aviva argues that s. 25 must be read together with the monetary limits in s. 18 and, further, that the mere fact these costs are mentioned only in s. 25 is not determinative. By way of analogy, it points out that attendant care assessments are also mentioned in s. 25 but that these costs are also limited by the monetary limits in s. 18. As it argues in paragraph 35 of its submissions:
Surely, it cannot be said that assessments conducted for the purpose of "reviewing and approving treatment plans" or for "attendant care" are outside the monetary limits described by s. 18(3) simply because they are referenced in s. 25 as these assessments clearly relate to assessments and examinations that are "in connection with any benefit or payment to or for an insured person under this Regulation". Therefore, the Adjudicator's reasoning that because an item or assessment is described in s. 25 means that it cannot also be described by s. 18 is faulty or erroneous.
18I accept Aviva’s submission that merely because an item is mentioned in s. 25 does not necessarily mean it is not included in the monetary limits contained s. 18. However, what Aviva fails to recognize is the fact that the examples it cites relate to a benefit or the payment of a benefit: treatment plans and attendant care benefits. A catastrophic assessment is something much different.
19In my view, the parties’ dispute revolves around the wording of s. 18 and, in particular, s. 18(5). Section 18(5) includes in the definition of medical and rehabilitation benefits “all fees and expenses for conducting assessments and examinations and preparing reports in connection with any benefit or payment.”
20The Adjudicator held that a catastrophic assessment is not a benefit or a payment. In doing so, he followed a line of cases that take as their starting point two appellate court decisions concerning the application of the two year limitation period for bringing claims.
21The first case is a decision of the Divisional Court, The Guarantee Company v Dong Do et al., 2015 ONSC 1891 (“Do”). Do was then endorsed the following year by the Court of Appeal for Ontario in the second, Machaj v. RBC General Insurance Company, 2016 ONCA 257 (“Machaj”). In Do, the applicant had applied to the Financial Services Commission of Ontario (“FSCO”) for a determination that he had been catastrophically impaired in a motor vehicle accident. The respondent insurer, The Guarantee Company, took the position that Mr. Do’s application was statutorily barred because it was brought more than two years after it had denied Mr. Do’s application for a catastrophic impairment assessment.
22At first instance and on reconsideration at FSCO, the Arbitrator and the Director’s Delegate held that a designation that a claimant is catastrophically impaired is not a benefit. Since the two year limitation period in the Insurance Act and the Schedule related to the determinations of disputes “concerning a refusal or denial of a benefit” the two year limitation period did not apply. The decision was upheld on appeal to the Divisional Court.
23Machaj addressed an attempt by RBC General Insurance Company to overcome the Do doctrine. In its denial letter, RBC attempted to manage the court’s distinction between benefits and assessments by notifying the insured, after denying a catastrophic assessment, that the insured “therefore…[did] not qualify for the increased benefits.” . RBC was successful on a motion for summary judgment in Superior Court and the applicant appealed to the Court of Appeal. The Court of Appeal applied Do and granted the appeal, holding that there was no difference in substance between the denial in Do and the Machaj denial. The words simply confirmed the fact that, absent a catastrophic determination, no more benefits were available.
24The reasoning in Do and Machaj were then applied by FSCO in two cases dealing with the interpretation of s. 18(5). In the first of the two, Cook and RBC General Insurance Company, Appeal P14-00038, RBC successfully argued before the Arbitrator at first instance that the wording of s. 18(5) included catastrophic impairment assessments within the $50,000 limit for medical and rehabilitation benefits. On reconsideration, Director’s Delegate Blackman overturned the Arbitrator’s decision.
25The respondent argues that the reconsideration decision in Cook “ducked” the Arbitrator’s finding that the wording of s. 18(5) includes the cost of catastrophic impairment assessments. I find this submission puzzling, since Director’s Delegate Blackman specifically held that the Arbitrator failed to follow his own logic regarding the interpretation of s. 18(5), resulting in an error of law. He noted that the Arbitrator presumed that s. 18(5) included catastrophic impairment assessments without further analysis.
26Cook, then, stands for the proposition that catastrophic impairment assessments are not caught by the language of s. 18(5). To that decision may be added the decisions of FSCO and this Tribunal in Henderson and Wawanesa Mutual Insurance Company, FSCO A14-001758 (“Henderson”) and NS. and Scottish & York Tribunal File# 17-007962/AABS (“Scottish & York”).
27In Cook, the Director’s Delegate pointed out that a catastrophic impairment is not a benefit, but rather the determination of a threshold issue about the available level of benefits. Even if wholly successful in her application to be found to be catastrophically impaired, the applicant is not entitled to treatment or a single payment for treatment until she submits a Treatment and Assessment Plan that is examined under the reasonable and necessary test for treatment.
28I am persuaded by the reasoning in Cook, Henderson and Scottish & York. In my view that reasoning accords with both the language and the spirit of the Schedule. The Adjudicator in Scottish & York touched on the latter point. He pointed out that to interpret s. 18(5) in the manner urged on me by Aviva, a seriously injured applicant may have to hold a large percentage of their medical and rehabilitation budget in reserve. In the current case, the assessment of approximately $21,000 represents 42% of the amount available for treatment.
29The percentage that might need to be held in reserve must be considered in light of the provisions of the Schedule setting out the definition of catastrophic impairment. In cases where s. 3(5) applies, an applicant may have to wait two years from the date of the accident to apply for a catastrophic determination. To be denied 40% of available reasonable and necessary treatment may have a devastating impact on potential recovery. Given that the purpose of the Schedule is to bring treatment resources to bear expeditiously, it runs in the face of that purpose to include a large percentage of available funds in reserve.
DECISION
30Having considered the submissions of the parties, I find that the respondent has failed to establish that the Adjudicator made a significant error of law such that the Tribunal would likely have reached a different decision. Having reconsidered the Adjudicator’s decision, I uphold it.
D. Gregory Flude
Vice-Chair
Tribunals Ontario – Safety, Licensing Appeals and Standards Division
Released: May 14, 2019