Citation: A.G-B. v. Unica Insurance Inc., 2021 ONLAT 19-003153/AABS

Release date: 05/25/2021

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:

A.G-B.

Applicant

and

Unica Insurance Inc.

Respondent

DECISION

ADJUDICATOR:

Theresa McGee, Vice-Chair

APPEARANCES:

For the Applicant:

Robert Kostyniuk, Counsel

For the Respondent:

Angela Comella, Counsel

HEARD:

By way of written submissions

1The applicant, A.G-B., was involved in an automobile accident on February 5, 2016, and sought benefits from the respondent, Unica Insurance Inc., pursuant to the Statutory Accident Benefits Schedule - Effective September 1, 2010¹ (the "Schedule").

2The respondent denied the applicant's claims. The applicant then applied to the Licence Appeal Tribunal ("Tribunal") for resolution of the dispute.

ISSUES

3The issues to be decided in the hearing are:

i. Is the applicant entitled to receive funds in the amount of $2,642.79 for an invoice for Davis Martindale Accountants in treatment plan submitted February 20, 2019, and denied by the respondent on February 20, 2019?

ii. Is the applicant entitled to receive funds in the amount of $182.21 for an invoice for Davis Martindale Accountants in treatment plan submitted March 25, 2019, and denied by the respondent on March 25, 2019?

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

4I note that the applicant advised the Tribunal by email on February 18, 2021 that the parties have resolved the issue, identified in the Tribunal's October 18, 2019 case conference order, of a claim for an income replacement benefit and any accrual of interest in relation to that benefit. As the issue has been resolved, I do not deal with it here. The applicant's February 18, 2021 email confirmed that the only issue remaining in dispute is that of "costs". As the applicant did not specifically exclude the issue of the costs of the accounting report (issues i. and ii. in para. 3 above), I consider them as remaining in dispute.

5Lastly, the applicant in submissions makes a claim for "costs" under s. 10 of Regulation 664. As I will explain, the applicant's submissions conflate an award under Regulation 664 with a claim for costs under Rule 19 of the Licence Appeal Tribunal, Common Rules of Practice and Procedure, Version I (October 2, 2017), as amended (the "Common Rules"). Under Rule 19, a party may raise a claim for costs at any time during a proceeding. However, the issue of an award under Regulation 664 is a separate one. It is not properly in dispute. The applicant raised it for the first time in its hearing submissions. She brought no motion to have the issue added at any time before the hearing. The respondent has not had an opportunity to properly address the issue and it would be prejudicial to add it at this stage. Therefore, I deal with the applicant's request for costs under Rule 19, but I decline to consider the issue of an award.

RESULT

6The applicant is not entitled to the cost of the invoices for the income replacement benefit accounting reports. As no benefits are owing, no interest is payable. There is no basis for a costs award. The application is dismissed.

ANALYSIS

Accounting reports

7Issues i. and ii. in para. 3 above are essentially one issue. Both are invoices for the costs of an accounting report about the applicant's income replacement benefit claim.

8Section 7(4) of the Schedule obligates an insurer to cover the cost of a report calculating an insured person's income if she is applying for an income replacement benefit based on employment or self-employment considered in the report. The report must also be prepared by a member of a designated body within the meaning of the Public Accounting Act, 2004 and be reasonable and necessary for the purpose of determining the insured person's entitlement to an income replacement benefit.

9There is no dispute that the applicant applied for an income replacement benefit or that the report was prepared by a regulated professional as the Schedule requires. The dispute is whether the report was reasonable and necessary for determining the applicant's entitlement to the benefit.

10The applicant submits the report was necessary because she received maternity benefits and some commissions from her employer. She submits that it was prudent to retain Davis Martindale to formally calculate the quantum of income replacement benefits owed to her.

11The respondent submits that the report was neither necessary nor reasonable. It submits that it was simple to calculate the quantum of the benefit. There was no self-employment, no overlapping employment, no business losses or replacement workers to consider. It submits that it correctly calculated the amount in 2016 and it was therefore unnecessary to seek a report three years later in February 2019. It submits that the amount claimed (a total of $2,825.00 for the two invoices) is wholly disproportionate to the simple set of calculations performed by the accounting firm.

12The respondent relies on three decisions of this Tribunal to support its submission that where a calculation is straightforward, a report under s. 7(4) will be unnecessary: S.M. vs. Aviva General Insurance Company; S.G. v Wawanesa Mutual Insurance Company; and P.M. v Aviva Insurance Canada.² The applicant directs me to no competing case law on the issue.

13In S.M., the Tribunal found that a s.7(4) report was unnecessary because the applicant had only one source of income; the calculation required a simple deduction for short-term disability payments; and the necessary financial documentation was readily available. No expertise was required to interpret the documentation.³ In S.G., where the income replacement benefit calculation involved documented employment income and EI sickness benefits, the Tribunal determined an accounting report to be unnecessary.⁴ In P.M., the Tribunal found that it was not difficult to accurately calculate the quantum of the benefit based on the applicant's employment income.⁵

14I agree with the respondent's position. The test is not whether the applicant felt it was "prudent" to obtain a report. It is whether the report was necessary and reasonable. The calculation of the applicant's income involved a set of straightforward calculations to determine her average gross weekly income, less collateral benefits and adjusted for her post-accident income. She had a sole source of employment income. Her post-accident maternity benefits required a simple deduction. The weekly income replacement benefit amount calculated by Davis Martindale was $378.18, which is $8.86 less than the quantum calculated by the respondent in a March 11, 2016 Explanation of Benefits. I find there was no meaningful dispute between the parties as to the quantum of the benefit. The necessary calculations did not require the expertise of a professional accountant.

15The accounting report was not necessary. I need not consider whether the total amount claimed was reasonably proportionate to the work performed.

Costs

16The applicant seeks an order for costs in the amount of $5000.00 plus HST and $170.24 plus HST for disbursements "pursuant to s. 10 of Ont. Reg. Regulation 664". This request conflates two distinct remedies: an award for the unreasonable delay or withholding of benefits under Regulation 664 and an award for costs under Rule 19 of the Common Rules. For the reasons set out in para. 5 above, I decline to consider the issue of an award under Regulation 664.

17A Rule 19 costs award will be granted where a party is found to have engaged in conduct that is unreasonable, frivolous, vexatious, or in bad faith.

18The applicant makes no submissions on how the test for costs set out in Rule 19 has been met in this case. She provides no particulars of conduct by the respondent that would warrant an award of costs. She has failed to establish unreasonable, frivolous, vexatious or bad faith conduct on the part of the respondent and I accordingly deny the request for costs.

19I note that even if I had considered the applicant's request for an award under Regulation 664 as an issue properly before me, the applicant made no submissions about conduct on the part of the respondent that would enable the Tribunal to evaluate a claim for an award. There is simply no foundation for a meaningful analysis of the costs claim, however construed.

CONCLUSION

20The applicant has not met her onus of establishing on a balance of probabilities that she is entitled to the costs of the accounting report claimed in this application. She has not justified an award of costs. No interest is payable. The application is dismissed.

Date of Issue: May 25, 2021