R.S. v. Pafco Insurance Company, 2020 CanLII 27384

Citation: R.S. vs. Pafco Insurance Company, 2020 ONLAT 19-006311/AABS

Tribunal File Number: 19-006331/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:

R.S.

Applicant

and

Pafco Insurance Company

Respondent

PRELIMINARY ISSUE DECISION

ADJUDICATOR: Jesse A. Boyce

APPEARANCES:

For the Applicant: Nathan Tischler, Counsel

For the Respondent: Jonathan Schrieder, Counsel

Written Hearing: March 11, 2020

OVERVIEW

1R.S. was injured in an accident on October 26, 2015. He sought various medical benefits and an income replacement benefit (“IRB”) from the respondent, Pafco, and then sought a catastrophic determination (“CAT”) as a result of impairments he sustained in the accident. R.S. underwent assessments of his own in preparing his OCF-19, which he submitted to Pafco.

2After receiving R.S.’s application, Pafco requested that R.S. attend for various s. 44 Insurer’s Examinations (“IE”) in order to assess him for CAT. R.S. refused to attend the neuropsychological IE, arguing that it was not reasonably necessary to determine CAT. Pafco raised a preliminary issue to determine whether R.S. is barred from proceeding with his CAT application.

3In addition, Pafco raised a second preliminary issue to determine whether R.S. is barred from proceeding with the remaining non-CAT issues in his application under s. 56 of the Statutory Accident Benefits Schedule - Effective September 1, 2010 (“Schedule”), being the IRB and various medical benefits, as he disputed these denials past the two-year limitation period.

ISSUES

4The preliminary issues listed in the case conference order are as follows:

i. Is the applicant’s claim for determination of catastrophic impairment barred from proceeding until he attends the neuropsychological insurer examination?

ii. Is the applicant barred from proceeding with the balance of his application (substantive issues 2 through 8 in the Order) pursuant to s. 56?

RESULT

5R.S. is statute-barred from proceeding with his CAT application under s. 55 of the Schedule until he attends the s. 44 neuropsychological IE scheduled by Pafco.

6R.S. is statute-barred from proceeding with the remaining substantive issues in dispute as he failed to appeal Pafco’s denials within the limitation period. Further, the Tribunal declines to extend the limitation period under s. 7 of the Licence Appeal Tribunal Act, 1999 (“LAT Act”) to allow R.S. to proceed.

ANALYSIS

Is R.S.’s claim for determination of catastrophic impairment barred from proceeding until he attends the neuropsychological insurer examination?

7Section 44 of the Schedule confers the right to Pafco to conduct IEs, but limits that right to IEs that are considered “reasonably necessary.” At issue is whether the IE for a neuropsychological assessment proposed by Pafco is reasonably necessary to determine whether R.S. is CAT. If so, R.S. is statute-barred under s. 55 of the Schedule from proceeding with his application until he attends the proposed IE. I find on the facts and evidence that Pafco’s proposed IE was reasonably necessary for a determination of CAT and that R.S. is barred from proceeding with his application until he attends the IE.

8On May 8, 2019, R.S. submitted an OCF-19 to Pafco alleging that Criterion 7 and 8 of the American Medical Association’s Guides to the Evaluation of Permanent Impairment, 4th Edition (“Guides”) were applicable. The Omega report that accompanied his OCF-19 featured four assessments: a physical impairment evaluation, a neurology evaluation, a mental and behavioural evaluation and an occupational therapy evaluation. Specifically, the neurology report by Dr. Robinson opined that R.S. “likely had a mild traumatic brain injury” and that he “has post-traumatic headache which has reduced over time.” On May 21, 2019, Pafco requested that R.S. attend s. 44 IEs pursuant to s. 45(3) in order to determine CAT. On May 23, 2019, R.S. applied to the Tribunal. Pafco commissioned a paper review and addendum by Dr. Paitich to assess which s. 44 IEs were reasonably necessary to evaluate R.S. for CAT. The report recommended assessments for the following: orthopaedic, neurology, neuropsychological, occupational therapy, psychological and a CAT executive summary. R.S. attended all of the s. 44 IEs but did not attend the neuropsychological IE scheduled for September 28, 2019.

9The parties’ positions are relatively straightforward. Pafco submits that its request for a neuropsychological IE was reasonably necessary based on the recommendation of Dr. Paitich and Dr. Robinson’s opinion that R.S. likely had a mild traumatic brain injury. In response, R.S. submits that it is not reasonably necessary because he never conducted a neuropsychological assessment and has never seen a neuropsychologist, that a recommendation for a particular IE from an orthopaedic surgeon like Dr. Paitich does not automatically make the IE reasonably necessary and, finally, because his own neurologist Dr. Robinson stated that a rating for mental status impairment under the Guides does not apply as R.S.’s cognitive complaints were “likely related to chronic pain, altered sleep and possible psychoemotional problems rather than the residual sequelae of a mild traumatic brain injury.”

10The parties address the principles outlined in the Tribunal’s jurisprudence¹ that concern whether a s. 44 IE is “reasonably necessary,” including: the timing of the request; the possible prejudice to both sides; the number and nature of previous IEs; the nature of the IEs being requested; whether there are any new issues being raised in the claim that require evaluation; whether there is a reasonable connection between the examination requested and R.S.’s injuries, etc. I will address each of these considerations in turn.

The timing of the request and notice

11To the parties’ credit, the timing and sufficiency of the IE notice was not a significant issue. I find Pafco’s request for the IE was timely and reasonable, made in good faith and appropriate given its rights under the Schedule. I do not find that this is a situation where Pafco was attempting to schedule IEs long after it was appropriate to do so, or that Pafco was attempting to secure more evidence for a hearing or engaging in trial brinkmanship. Indeed, I find Pafco scheduled the IEs almost immediately after receiving notice of the CAT application to the Tribunal, which R.S. filed rather quickly. Further, all of the notices were compliant with the Schedule and other than the reason for the IE, R.S. does not take issue with the timing.

Prejudice

12Pafco submits that it will be prejudiced if R.S. is not required to attend the IE and can proceed to the Tribunal because it would be left without the ability to provide a full answer and defence and meaningfully respond to the OCF-19. It argues that the prejudice element invariably favours the applicant and any prejudice could be offset by scheduling the IE promptly, within 60-90 days. R.S. submits that an in-person IE would be an unnecessary invasion of privacy and, since his assessors found no neuropsychological basis for his impairments, that the only basis for Pafco’s request is “to provide ammunition for cross examination at a hearing regarding possible prior inconsistent statements or to provide a backdoor for examinations for discovery.”

13There are currently no dates set for a substantive hearing, so I find there is limited prejudice from a time perspective as the parties would not be forced to vacate hearing dates or reschedule witnesses. Other than having to attend one more IE, there was no compelling evidence provided by R.S. of actual prejudice if he were required to attend the IE proposed, other than a claim that his privacy rights may be affected. While the Tribunal is alive to applicant’s privacy rights and concerns, the existence of these rights does not make any IE that an applicant disagrees with presumptively unreasonable or unnecessary. CAT examinations are inherently intrusive, but a neuropsychological IE may very well confirm that R.S. is CAT. In such a case, R.S. would not be subject to an arduous hearing. Alternatively, if the IE determines he is not CAT, then the parties return to the same course they are currently on, each with relevant medical documentation in hand that speak to the issues in dispute and, further to R.S.’s point, rule out certain criterion of the Guides. Additionally, R.S. has not demonstrated how an in-person neuropsychological IE is more intrusive than any of the other IEs he has willingly attended.

The number and nature of previous examinations

14Pafco submits that the IE is reasonably necessary because in the four years post-accident, R.S. has only been assessed twice for non-CAT issues. It argues that R.S. underwent four CAT assessments of his own and Pafco’s request for five is, in comparison, not unreasonable or unduly cumbersome. In addition, it submits that the nature of the IE is in line with R.S.’s CAT-related complaints.

15While I am alive to R.S.’s concerns over privacy and his argument that IEs are intrusive, I do not agree that one more IE, as proposed, is unreasonable given the concerns identified in the file. Further, I agree that the proposed IE is not excessive considering the limited IEs R.S. has been subject to previously. While it is always preferable to limit the number of IEs an applicant is required to attend, contrary to R.S.’s submission, I find no indication of bad faith on Pafco’s part in requesting the neuropsychological IE or evidence from R.S. that an in-person neuropsychological IE is somehow more intrusive than any of the other IEs he agreed to attend. Indeed, the recommendation for this IE came as a result of one of R.S.’s own assessors’ diagnosis and the IE is only one more IE than R.S. subjected himself to on his own accord.

Reasonable connection between the IE and CAT

16On the facts, I find there is a reasonable connection between the IE requested and R.S.’s CAT-related impairments. Pafco submits that R.S. has reported headaches and post-concussion syndrome, has claimed difficulty with reading and watching TV, feels “jumbled” at times and has concentration issues. Further, R.S.’s own neurologist, Dr. Robinson, stated that R.S. likely had a mild traumatic brain injury.

17In response, R.S. submits that the Omega team noted that the applicability of a mental status impairment rating was already reviewed by Dr. Robinson and it was determined that a rating did not apply, as R.S.’s cognitive complaints were felt to “be related to chronic pain, altered sleep and possible psychoemotional problems rather than the residual sequelae of his mild traumatic brain injury.” R.S. argues that since neither Dr. Robinson nor any of his other treating or assessing health practitioners found that a rating for cognitive impairment applies under Chapter 4, Table 2 of the Guides, it is not reasonably necessary for Pafco to require R.S. to be evaluated with respect to his mental status impairment. Finally, R.S. submits that “in the absence of any finding that the residual sequelae of [R.S.’s] mild traumatic brain injury result in a mental status impairment, a neuropsychological evaluation is not reasonably necessary.”

18I find this line of argument supports Pafco’s request. Respectfully, I agree with Pafco that it is entitled to assess the accuracy of the insured’s claims, which, in this case, is Dr. Robinson’s belief, echoed by the Omega team, that R.S.’s symptoms are only related to chronic pain, altered sleep and possible psychoemotional problems rather than the residual sequelae of his mild traumatic brain injury, with which Dr. Robinson diagnosed R.S. In my view, Pafco should be permitted to examine the connection and determine on its own whether R.S. has a traumatic brain injury rather than just taking another assessor’s word for it after the fact. In turn, Pafco is entitled to respond directly to those opinions.

19Further, while the neurology IE was scheduled to address R.S.’s headache complaints, the neuropsychological IE was requested to examine whether R.S. sustained a traumatic brain injury and what effects, if any, it has on his cognitive and functional abilities. Neuropsychologists are specifically trained to examine the relationship between brain function and ability. Against this fact, I place no weight in R.S.’s submission that Dr. Paitich is unqualified to recommend a neuropsychological IE because he is an orthopaedic surgeon; rather, Dr. Paitich’s recommendation was not based on his own opinion but on Dr. Robinson’s opinion when he advanced the diagnosis that R.S. has a mild traumatic brain injury. In the grand scheme of a CAT dispute, I agree that the neuropsychological IE is therefore reasonably necessary to meaningfully respond to R.S.’s CAT application and Dr. Robinson’s diagnosis. In turn, I find it unreasonable that R.S. refused to attend.

20For these reasons, I find, on a balance of probabilities, R.S. is statute-barred from proceeding with his application under s. 55 until he attends the neuropsychological IE requested by Pafco.

Is R.S. barred from proceeding with the balance of his application (substantive issues 2 through 8 in the Order) pursuant to s. 56?

21Pursuant to s. 56 of the Schedule, an application under s. 280(2) of the Insurance Act in respect of a benefit shall be commenced within two years of the insurer’s refusal to pay the amount claimed. The two-year limit is triggered when the insurer provides clear and unequivocal notice of a denial and outlines the insured’s right to engage the dispute resolution process.

22Here, R.S. contends that he should be permitted to proceed to a hearing on the merits of his claims for income replacement benefits, a medical benefit in the amount of $2,723.44, the costs of completing two treatment plans each in the amount of $200.00, interest and an award under O. Reg. 664. Pafco raised the preliminary issue that all of R.S.’s claims pertaining to these benefits are statute-barred under s. 56 of the Schedule due to his failure to dispute the denials within the limitation period.

23To his credit, R.S. concedes that his application to dispute Pafco’s denials was late by the following number of days respectively per benefit: 130 days after the limitation for the termination of the income replacement benefit; 334 days following the limitation period for the denial of the treatment plan in dispute and 21 days after the limitation period for the denial of the two claims for costs of assessments. Instead, R.S. offers three arguments why his application on the remaining benefits should be permitted to proceed to the Tribunal under s. 55(2).

24First, citing Tomec v. Economical Mutual Insurance Company, 2019 ONCA 882, R.S. submits that the limitation period to claim income replacement benefits has not expired because of the operation of the doctrine of discoverability. Second, R.S. submits that the limitation period to dispute the cost of invoices has not expired because there was no clear and unequivocal denial of payments nor were any reasons given for the denials. Third, R.S. submits that the Tribunal has the discretion to extend the limitation period under s. 7 of the LAT Act and the merits of the case suggest the limitation period should be extended to allow him to proceed. In response, Pafco submits that Tomec does not apply to the income replacement benefit claim, that it issued proper denials of all of the treatment plans and that s. 7 of the LAT Act should not be applied as R.S. does not meet the test.

25First, with regards to the income replacement benefit claim, R.S. submits that: “[W]hile income replacement benefits can be said to be a single benefit income replacement benefits within 104 weeks of disability and beyond 104 weeks of disability constitute separate causes of action. This is because the elements of the causes of action for pre 104-week income replacement benefits and post 104-week income replacement benefits are distinct.” Further, R.S. argues that the “cause of action for entitlement to post 104 income replacement benefits does not accrue until the insured person has been disabled for at least 104 weeks because they cannot reasonably know whether they will have a complete inability to engage in any employment on an ongoing basis until that time.” On this basis, R.S. contends that Tomec dictates that his cause of action for entitlement to income replacement benefits beyond 104 weeks of disability did not accrue until at least 104 weeks following the accident which was on October 23, 2017 and since his application was submitted on May 23, 2019, he should be permitted to proceed because it was within the two-year period.

26Pafco submits that Tomec is distinguishable because it dealt with attendant care and housekeeping in the CAT context and that framework cannot be analogized to income replacement benefit claims. It argues that there is no provision that allows an insured to reapply for specified benefits following a termination by an insurer and that it is well settled that the only remedy for an insured is to appeal an income replacement benefit termination, a single event, within two years.²

27While the Tribunal is alive to Tomec, I agree that there is no indication that the Tomec court overturned its decision in Bonilla, where it declined to import the discoverability rule to income replacement benefits and found that an insured’s loss is crystallized when a notice of termination is received. Similarly, and contrary to R.S.’s claim, there is no indication that the Tomec court, in finding that discoverability applied to attendant care and housekeeping in CAT matters, also determined income replacement benefits to be separate claims, which would overturn the finding from the Bonaccorso court that it is one single claim. In addition, R.S. was paid income replacement benefits in this case, which were then terminated due to findings from a psychologist and orthopaedic surgeon that he did not meet the test. Having received the benefit, I find it difficult to reconcile how R.S. did not discover his entitlement to claim the benefit until sometime later. On this basis, I agree with Pafco that his remedy was to appeal the termination in a timely manner. Unfortunately, R.S. missed the limitation period by 130 days, a significant period of time.

28Second, I find nothing to indicate that Pafco’s denials on any of the disputed treatment plans were deficient or did not meet the requirements of Smith v. Co-operators, 2002 SCC 30. On review of the explanation of benefits, I find clear and unequivocal notice that the benefits claimed would not be paid, or specific to the income replacement benefit, would be terminated at a certain date. The reasons provided as to why Pafco would not pay the $200 costs of assessment are due to Part 3 not being complete, as the invoice references another treatment plan. Pafco indicated to R.S. that the invoices should be resubmitted with a completed Part 3 for reconsideration. On review of the invoice, it is very unclear what R.S. is claiming and the Tribunal has no evidence before it that R.S. did resubmit the invoice with more clarification. In the absence of this evidence, there may not even be a dispute to proceed over.

Section 7 of the LAT Act

29Section 7 of the LAT Act affords the Tribunal statutory discretion to extend the time for commencing a proceeding in certain circumstances if it is satisfied that there are reasonable grounds for applying for the extension and for granting relief. There are four factors the Tribunal weighs in determining whether the justice of the case requires an extension be granted: i) the existence of a bona fide intention to appeal within the appeal period; ii) the length of the delay; iii) prejudice to the other party; and iv) the merits of the appeal. These factors are not strict elements that must each be met in order to grant an extension of time. Rather, they are a guide to assist in determining the justice of the case. Whether to grant an extension of time depends on the specific facts of each case. On the facts, I decline to exercise the Tribunal’s discretion to extend the limitation period under s. 7 of the LAT Act.

30With respect to bona fide intent to appeal these specific denials, Pafco submits that between the denials and this application, R.S. took no steps to indicate an intention to proceed with an appeal and missed the limitation period by a considerable amount of time. In response, R.S. points to the fact that he continued to submit treatment during the limitation period and ultimately sought a CAT determination as evidence of a bona fide intention to appeal and that he “always intended to pursue his claims.” And yet, in submissions, R.S. also indicates that his failure to apply to the Tribunal was “due purely to inadvertence, and not for any other reason.” While the Tribunal appreciates the honesty, it severely undermines his claim that he had a bona fide intention to appeal the denials of the specific benefits in dispute.

31Pafco submits that R.S. provided no explanation for the length of the delay in appealing the denials and directs the Tribunal to the number of days that elapsed after the limitation period expired before R.S. applied to the Tribunal: 130 days after the limitation for the termination of the income replacement benefit expired; 334 days following the expiry of the limitation period for the treatment plan in dispute and 21 days after the limitation period for the denial of the two claims for costs of assessments passed. R.S. submits that the Tribunal has previously found delays of 130 days and 21 days to be not unduly significant in assessing whether to extend a limitation under s. 7 of the LAT Act. On the treatment plan delay, R.S. submits that “the delay assumes substantially less importance given that [Pafco] had approved a similar treatment plan for the same services and by the same providers within a year prior to [R.S.’s] application to the Tribunal. I agree that a 21-day delay is not unduly significant and, considered alone as the only delay in a file, may be grounds to extend the limitation period. However, I consider the significant delays that accompany this relatively minor delay, being 130- and 334-day delays, to be unacceptable, especially so where the delay was allegedly due purely to inadvertence, and not for any other reason.

32R.S. submits that the prejudice and merits of the claim elements warrant greater weight as they are the most important. He argues that Pafco has not demonstrated that it will be prejudiced if his claims are allowed to proceed. However, R.S. does not offer any substantive reason why he will be prejudiced either. While I agree, generally, that the prejudice in not extending a limitation period almost invariably skews towards the insured, R.S. has not demonstrated why, on the specific facts of this case and as a result of his own inadvertent delay, not extending the limitation will prejudice him or why the Tribunal should assign greater weight to this factor as a result.

33Finally, with regards to the merits of the claim, R.S. submits that due to his ongoing CAT claim, there is evidence that he belongs to the small category of victims who suffer from lasting and very serious health impacts as a result of an accident. R.S. directs the Tribunal to comments from assessors that he requires continuing treatment and continues to seek same. In response, Pafco submits that it is clear that R.S. does not meet the test for income replacement benefits, that the treatment plan is not reasonable and necessary and that the cost of assessment claim will fail because the invoices were inconsistent. Given the fact that the major issue in dispute in this matter is R.S.’s CAT claim, it follows that there is obviously some merit to the dispute. However, I disagree that there is necessarily merit to the dispute over the specific benefits here that R.S. failed to appeal within the limitation period.

34Accordingly, I find the factors weigh in favour of Pafco and decline to exercise the Tribunal’s discretion to extend the limitation period under s. 7 of the LAT Act to permit R.S. to appeal the remaining issues in dispute under s. 56.

R.S.’s motion

35Prior to the commencement of this written hearing, R.S. filed a motion with the Tribunal for an order excluding the “Catastrophic Impairment Triage File Review – Addendum by Dr. Paitich” from Pafco’s evidence. The addendum report was authored by Dr. Paitich in response to Omega’s addendum report finding that the neuropsychological IE was not reasonably necessary. The Omega addendum report was served on Pafco one day before productions for this written hearing were due. In turn, Pafco’s addendum report was served on R.S. past the deadline for submissions.

36R.S. submits the addendum report was provided beyond the production deadline specified in the Order. Further, he submits that he had expressly withdrawn consent for this IE report and the notice of the assessment failed to provide medical or other reasons for the IE and is non-compliant with the Schedule. R.S. also submits the report was not reasonable and necessary and this examination was involuntary, thus violating his privacy rights.

37In response, Pafco submits R.S.’s motion should be dismissed. It argues that R.S. served his catastrophic addendum report one day prior to the production deadline, making it impossible for Pafco to obtain a responding report and comply with the production deadline. Pafco further submits that relevant evidence like the report should not be excluded on technical grounds and it would be prejudiced if this report was excluded.

38The resulting order from the Tribunal was that the hearing adjudicator will be in the best position to weigh the evidence in the context of the totality of evidence proffered at the hearing. The Tribunal ordered that the hearing adjudicator may elect to exclude the report or accord it whatever weight they deem necessary. On review of the report and motion submissions, I allowed the report into evidence. To be frank, I afforded it limited weight since Dr. Paitich’s addendum opinion was not substantially different from his initial recommendation on the neuropsychological IE. Ultimately, I found the inclusion of the report had little bearing on the preliminary issues before the Tribunal.

ORDER

39R.S. is statute-barred from proceeding with his CAT application under s. 55 of the Schedule until he attends the s. 44 neuropsychological IE scheduled by Pafco.

40R.S. is statute-barred from proceeding with the remaining substantive issues in dispute as he failed to appeal Pafco’s valid denials within the limitation period. Further, the Tribunal declines to extend the limitation period under s. 7 of the LAT Act to allow R.S. to proceed.

41The parties shall contact the Tribunal so a case conference may be scheduled in order to address how to proceed. If the parties are able to resolve the issues, they shall immediately notify the Tribunal.

Footnotes

1. 1See, for e.g., 17-005291 v. Travelers Canada, 2018 CanLII 13172 (ON LAT) and 17-001138 v. CAA Insurance, 2018 CANLII 76420 (ON LAT).
2. 2See, for e.g. Sietzema v. Economical Mut. Ins. Co., 2014 ONCA 111; Bonilla v. Preszler, 2016 ONCA 769; Bonaccorso v. Optimum Ins. Co., 2016 ONCA 34.