Citation: F.A. vs. Wawanesa Insurance, 2020 ONLAT 18-008453/AABS

Released Date: 03/05/2020

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:

F.A.

Applicant

and

Wawanesa Mutual Insurance Company

Respondent

DECISION

ADJUDICATOR:

Monica Chakravarti

APPEARANCES:

For the Applicant:

[F.A.], Applicant

Murad Huseynov, Paralegal

For the Respondent:

Kathleen O’Hara, Counsel

Interpreter

{M.S] Bengali Language

Court Reporter:

[A.S.]

HEARD: In-Person:

June 10 and 11, 2019.

OVERVIEW

1On July 4, 2018 the applicant was involved in a motor vehicle accident (the “Accident”). As a result of the Accident the applicant sought benefits pursuant to the Statutory Accident Benefits Schedule - Effective June 1, 2016 (the ''Schedule'').¹

2Specifically, the applicant sought Income Replacement Benefits (IRBs) as a result of not being able to work at his own occupation due to injuries and impairments sustained in the Accident. At some point the respondent conceded that the applicant could not return to work; however, they required information to calculate the IRBs. The applicant did not produce the information as requested.

3The dispute that ultimately led to this hearing is centered on whether the respondent could withhold IRBs because, as detailed below, the applicant did not comply with requests made by the respondent for documents and a request made for the applicant to participate in an insurer medical examination.

ISSUES IN DISPUTE

4The issues in dispute are:

a. Is the applicant entitled to payment of the IRBs for the period of August 17, 2018 to March 29, 2019 or is the respondent not liable to pay the IRBs for that period of time?

b. Is the applicant entitled to income replacement benefits for the period of February 8, 2019 onwards or is the respondent entitled to withhold the IRBs for that period of time?

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

d. Is the applicant entitled to receive an award under RRO 664 because the respondent unreasonably withheld or delayed payment of the benefits?

RESULT

5Based on the evidence and analysis, I find that the applicant did not comply with Section 33 (1) of the Schedule and therefore pursuant to section 33(6) the respondent was not liable to pay IRBs from August 17, 2018 until March 29, 2019.

6Further, I find that the applicant failed to participate in an insurer examination and the respondent was entitled to withhold the IRBs pursuant to section 37(7)(b) of the Schedule as of February 8, 2019.

ANALYSIS

7The onus is on the applicant to prove his eligibility to income replacement benefits (“IRBs”) and the quantum of the IRBs.

8The respondent requested documents from the applicant with respect to the applicant’s IRBs pursuant to section 33(1) of the Schedule. The documents were not produced, and the respondent withheld the IRBs, pursuant to section 33(6).

9Section 33 (1) of the Schedule states in part:

An applicant shall within ten business days after receiving a request from the insurer, provide the insurer with the following:

1. Any information reasonably required to assist the insurer in determining the applicant’s entitlement to a benefit.

10Section 33 (6) of the Schedule states that the respondent is not liable to pay a benefit in respect of any period during which the insured person fails to comply with subsection 33(1).

11Both the respondent and the applicant agree that pursuant to section 5 of the Schedule that the applicant, as a result of impairments sustained in the Accident was unable to return to his pre-accident employment within the 104 weeks following the Accident.

12The applicant submits that the respondent requested information that was not reasonably required for the entitlement of the income replacement benefit. The applicant submits that the respondent had no reason to request the documents.

13The respondent submits that the documents requested [noted specifically below] were requested to calculate and to determine entitlement of income replacement benefits. Despite the request for the information, the applicant failed to comply with its request for information and therefore the respondent submits it is not liable to pay benefits as of August 17, 2018 until the applicant complied with the request, (i.e. March 29, 2019 when the documents were delivered).

DOCUMENTS REQUESTED

14Through the below dated letters, the respondent requested the following documents pursuant to section 33(1) of the Schedule:

1. Letter of July 20, 2018:

• 4 weeks pre-accident paystubs

• Notice of Assessment for 2017

2. Letter of August 2, 2018:

• T4 for 2017

• Pre- and post-accident bank statements

3. Letter of August 21, 2018:

• Signed statement with a Wawanesa Employee

• 2017 T4 slip

• Bank statement reflecting pre-accident income

• Copy of employment file, including the particulars of the WSIB claim filed as a result of the motor vehicle accident

4. Letter of October 23, 2018 (letter #1):

• Family physician records (Dr. Arif) from 3 years pre-accident to date

• WSIB file

• Complete EI file

5. Letter of October 23, 2018 (letter #2)

• Bank statements for the last 52 weeks before the accident

• Post-accident bank statements to current date (both personal and business)

• Copies of all financial statements that pertain to [the] 52 week period prior to [the date of the] accident

• HST statements from the last fiscal year to current date

• RKS Services business records from January 1, 2017 to present

• RKS Services business records for 2017

• RKS Services RBC Bank records from January 1, 2017 to the present

• The claimant’s personal TD Bank records from 52 weeks pre-accident to the present

• Copies of all cancelled cheques from Ampson from 52 weeks pre-accident to August 30, 2018

• List of additional financial documents will be forwarded shortly from BDO Accounting.

PRE-ACCIDENT INCOME RECORDS

a) August 17, 2018 - September 28, 2018: Pre-Accident Bank Records are reasonably required

15The applicant submits that because he is self-employed, then paragraph 3 of section 4(2) of the Schedule permits him to designate his gross employment income to be the income for his last fiscal year; in this case, his 2017 income. The applicant also submits that, pursuant to section 4(5) of the Schedule, the applicant’s pre-accident income is what is reported and noted in his 2017 Notice of Assessment (NOA) regardless if the income is underreported or unreported. Therefore, the pre-accident income records, including the bank records, were not reasonably required.

16The respondent submits and the evidence shows that the applicant underwent an examination under oath (EUO) on September 28, 2018. At the EUO, the applicant revealed to the respondent for the first time that he was also self-employed at the time of the Accident.

17Until the EUO, the respondent only knew of the applicant as an employee for another company. To that end, they had “paystubs” that were not “paystubs” in the conventional sense, information from an employer that did not necessarily corroborate the applicant’s information, no real information regarding the amount of income in the four weeks prior to the Accident and a letter from the applicant indicating that he was designating the four-week pre-accident income period as the basis for his IRB calculations.

18Prior to the EUO, as noted in the log notes and in the adjuster’s testimony, the respondent was under the impression that the applicant was not self-employed because it had not been informed otherwise.

19The adjuster testified that the respondent needed information that showed the applicant earning an income in the four-week period prior to the Accident and required information to show that the applicant was employed or was employed for at least 26 of the 52 weeks prior to the Accident.

20At the time of the request for the pre-accident bank records, (August 2, 2018) the respondent had the 2017 NOA, which showed the income earned in 2017 but I find that the respondent did not have any documents showing earnings for the first six months of 2018 (i.e. from January 1, 2018 until the accident on July 4, 2018)

21I also find that, at the time of the request for the pre-accident bank records, which was prior to the EUO, the respondent was under the reasonable apprehension that the applicant was not self-employed and the request for the pre-accident bank records was reasonable.

22I find that the applicant failed to provide information reasonably required to assist the insurer in determining the applicant’s entitlement to a benefit and therefore the respondent is not liable to pay the IRBs from August 17, 2018 (ten business days following the requests of August 2, 2018) until September 28, 2018 (the date the respondent became aware of the applicant’s self-employment status) pursuant to section 33(6).

23Further as the applicant has provided no reasonable explanation as to why he failed to provide the documents, or for that matter inform the insurer of their misapprehension of his full employment status, I find that the respondent is entitled to withhold the IRB from August 17, 2018 until September 28, 2018.

24I find that as of September 28, 2018, once the respondent was aware of the applicant’s self-employment status, it was no longer reasonable for the applicant to provide the pre-accident bank records.

b) After September 28, 2018: Pre-accident bank records were not reasonably required:

25Relying on paragraph 3 of section 4(2) of the Schedule, the applicant submits that he, as a self-employed person, can use his last fiscal year as his gross employment income. The respondent had the 2017 NOA and knew that it was the applicant’s fiscal year, and therefore no further documents would have been reasonably required.

26The respondent submits that the applicant’s own accountant in its accounting report indicates that the bank records would be needed to calculate the IRBs and therefore it was reasonable to request same.

27I find that, pursuant to section 4(5) of the Schedule, an applicant’s gross employment income for the purposes of calculating IRBs is what is reported in the NOA. I find that is information that respondent had and, therefore, as of September 28, 2018 when the respondent knew that the applicant was self-employed, that the request for pre-accident bank records were no longer reasonably required as they had the 2017 NOA.

c) Employment File and WSIB File reasonably required if they existed

28I also find that the request for the employment file and WSIB file would have been reasonably required if they existed. As per the respondent’s log notes of August 21, 2018 the purpose of requesting the employment file was to get particulars of the WSIB claim. At some point in this matter the respondent seemed to concede that this Accident was not a workplace accident. Accordingly, I find the respondent’s request for the WSIB file and its accompanying employment file, was not reasonably required for the purposes of determining eligibility for or quantum of the IRBs and, therefore, not a basis to suspend benefits.

POST ACCIDENT INCOME RECORDS

29Based on the evidence, I find that that the post-accident bank records are reasonably required to assist the respondent in determining the applicant’s ongoing entitlement to IRBs.

30On Friday September 21, 2018 and Monday September 24, 2018, the respondent conducted surveillance. While the applicant agreed that the surveillance could be construed as him engaging in his employment, he asserted that he was simply assisting his employer and not earning any income.

31The respondent submits that the request for the post-accident bank records was to determine if applicant was receiving any post-accident income.

32The applicant submits that he could not possibly be working because the surveillance showed the applicant going to different job sites for a short period of time. At the hearing, the respondent’s adjuster agreed that surveillance does not show the applicant engaging in perceived work activities for a full working day. The adjuster testified, however, that that was not her impression at the time she saw the surveillance (October 2018) and she requested the documents based on her impression of the surveillance in October of 2018.

33Based on the surveillance evidence, I find it was reasonable for the respondent to request information to corroborate if the applicant was receiving any post-accident income. While I acknowledge that both parties concede, at the hearing, that the applicant was not working, this concession did not exist at the time of the respondent’s request. Therefore, based on the applicant appearing to be working and the belief of the adjuster that the applicant was working at the time of the request for the post-accident bank records, it was reasonable to request the post-accident bank records to verify any post-accident income.

34The applicant submits that he was never told as to why the post-accident bank records were requested. I do not find this persuasive as by the same token, the applicant never enquired to the respondent as to why it was requesting same until months later. Further, the respondent, in their letter to the applicant of October 23, 2018 indicated that it required the post-accident bank records to verify post-accident income and the applicant still did not provide them.

35I find that the HST returns post-accident, business records post-accident, and financial statements post-accident were not reasonably required. To ask the applicant to provide these documents in addition to the bank records is, in my view, overreaching. The respondent on October 23, 2018 clearly articulated that the reason for the post-accident bank records was for the purposes of determining post-accident income; however, they do not provide any reason or rationale for the other records.

36Therefore, I find that the respondent was entitled to suspend benefits as of August 17, 2018 (ten business days after the respondent first requested the post-accident bank records) based on the applicant not complying with the request for post-accident bank records under section 33. The post-accident bank records were not provided until March 29, 2019 and therefore the respondent is entitled to withhold IRBs until March 29, 2019.

37The applicant has provided no reasonable explanation as to why he failed to provide the post-accident bank records, other than relying on the advice of his legal representative. Therefore, I find that no IRBs for that period are owing to the applicant.

SECTION 44 ASSESSMENT

38Section 44(1) of the Schedule states:

For the purposes of assisting an insurer to determine if an insured person is or continues to be entitled to a benefit…., but not more often than is reasonably necessary an insurer may require an insured person to be examined under this section by one or more persons chosen by the insurer who are regulated health professionals…

39On or about January 28, 2019 the respondent required the applicant to undergo an assessment by way of a paper review pursuant to section 44(1) of the Schedule (the Paper I.E). This was preceded by a request and receipt of a disability certificate and updated clinical notes and records from the family doctor.

40On or about February 1, 2019 the applicant sent a letter to the assessment company retained by the respondent and revoked its consent to the Paper I.E. and its consent for the assessor performing the paper I.E. to release the report.²

41The applicant submits that the respondent unreasonably required the applicant to “attend” by way of consenting to the paper I.E assessment and that the sole purpose of the Paper I.E. was to obtain a report that could be used during the hearing and for no other purpose.

42The respondent submits that they received new information from the applicant, namely pre- and post-accident clinical notes and records and required an assessment by way of document review by an assessor to determine if the applicant continued to be eligible for IRBs.

43The Paper I.E was to be conducted by the same assessor who conducted an in-person examination on December 21, 2018 (the in-person I.E.) and concluded that the applicant could not return to his pre-accident employment due to his injuries.

44The applicant has provided no evidence that the purpose of the Paper I.E. was for the purposes of the respondent bolstering its position at the hearing other than the email from the assessment center that states that the Paper I.E. assessor also reviewed the surveillance.

45The applicant has provided no evidence or information that the Paper I.E. was happening more often that reasonably necessary. The in person I.E. was conducted on December 11, 2018 with the report of December 21, 2018. The Paper I.E. was scheduled for February 13, 2019.

46Further I am persuaded that at the in person I.E. of December 11, 2018, the assessor was not furnished with any clinical notes and records. The assessor’s comments that he would be interested in seeing those records to “clarify [the applicant’s] clinical presentation” leads me to conclude that the respondent’s request for the clinical notes and records and the respondent’s request for a Paper I.E. after receipt of the clinical notes and records to be reasonable.

47I note at the time of the January 28, 2019 request for the paper I.E., the applicant had returned to his employment since January 2, 2019, despite the assessor indicating in the in person I.E. just a few weeks earlier that the applicant could not return. The applicant testified that he was back at work but was not working the same hours as before.

48Given this material change in his employment circumstances from the time of the in-person I.E. to the time of the request for the Paper I.E. and given that further medical information was provided to the respondent which the assessor had indicated that he would be interested in seeing, I find that the Paper I.E. was reasonable in the circumstances.

49Section 37(7) of the Schedule states:

37(7) If the insured person fails or refuses to comply with subsection 44(9), the insurer may:

(b) refuse to pay specified benefits relating to the period after the insured person failed or refused to comply with that subsection and before the insured person complies with subsection.

50Subsection 44(9) of the Schedule states in part:

(9) the following rules apply in respect of an examination:

1. If the attendance of the insured person is not required, the insured person and the insurer, shall within five business days after the day the notice under section (5) is received by the insured person provide the persons or persons conducting the examination such information and documents as are relevant and necessary for the review of the insured’s person medical condition.

51In my view, the applicant -in revoking its consent to the assessor- failed to provide the documents that were necessary for the Paper I.E. to be completed. Therefore, the respondent was entitled to invoke subsection 37(7)(b) in refusing to pay the benefits.

INTEREST AND AWARD

52The result of my decision is that no IRBs are owing to the applicant and therefore no interest is payable.

53As the respondent has not unreasonably withheld or delayed the payment of benefits, there will be no award under Ontario Regulation 664.

CONCLUSION

54Based on the evidence and analysis above I find that the applicant did not comply with Section 33 (1) of the Schedule and therefore pursuant to Section 33(6) of the Schedule, the respondent was not liable to pay IRBs from August 17, 2018 until March 29, 2019.

55Further I find that the applicant failed to attend an I.E. and the respondent was entitled to withhold the IRBs pursuant to section 37(7) of the Schedule as of February 8, 2019.

56The application is dismissed.

Footnotes

1. 1Reg 34/10
2. 2I note that despite the fact that the assessment was to take place on February 13, 2019, the assessor had already completed the report, and the revocation of the consent by the applicant translated into the assessor not furnishing the report to the respondent.