Citation: Sivaramesh v. TD General Insurance Company, 2023 ONLAT 21-012672/AABS

Licence Appeal Tribunal File Number: 21-012672/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:

Balakrishnan Sivaramesh

Applicant

and

TD General Insurance Company

Respondent

DECISION

ADJUDICATOR:

Harry Adamidis

APPEARANCES:

For the Applicant:

Balakrishnan Sivaramesh, Applicant Godfrey Bakeerathan, Counsel

For the Respondent:

Peggy Moore, ADR Adjuster

Navid Ghaharaei, Counsel

Interpreter: Court Reporter:

Sri Ranjani (Tamil) Nikita Ivachtchenko

HEARD: by Videoconference:

April 24, 2023

OVERVIEW

1Balakrishnan Sivaramesh, the applicant, was involved in an automobile accident on March 22, 2021, and sought benefits pursuant to the Statutory Accident Benefits Schedule - Effective September 1, 2010 (including amendments effective June 1, 2016) (the “Schedule”). The applicant was denied benefits by the respondent, TD Insurance, and applied to the Licence Appeal Tribunal - Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.

2After the applicant filed the application, the respondent filed a motion to add the issues of a repayment of the income replacement benefit and interest. On March 30, 2023, the Tribunal issued an order adding these two issues.

3On April 21, 2023, the applicant filed a Notice of Withdrawal.

ISSUES

4The issues in dispute are:

i. Is the respondent entitled to a repayment of $22,268.23 relating to its payment of an income replacement benefits (IRB) for the period of March 30, 2021 to September 13, 2022, due to a wilful misrepresentation of material facts?

ii. Is the respondent entitled to interest on any repayment due?

RESULT

5The respondent is entitled to a repayment.

6The respondent is not entitled to interest.

PROCEDURAL ISSUES

7The applicant filed a motion the day before the hearing on Sunday, April 23, 2023, asking for the following three items of relief:

a) That the Tribunal not consider the repayment issue;

b) To not allow the respondent to rely on documents produced late and that are not in compliance with the case conference order;

c) That the Tribunal make a negative inference in regard to the respondent’s act of bad faith by including documents in the respondent’s brief without having disclosed those documents in accordance with the case conference order.

8In regard to not proceeding with the repayment issue, the applicant submits that the Tribunal’s motion order connects the issue of the quantum of the IRB to the repayment issue. The applicant asserts that the IRB quantum issue is now withdrawn and therefore the justification for adding the repayment issue is no longer in place. As such, there is no basis to proceed with the repayment issue and the entire proceeding should be withdrawn. The applicant refers to the closure letter in Gunasingam v. BelairDirect 21-003706/AABS, an unreported case, as a precedent where the Tribunal did not allow the respondent’s repayment issue to proceed after the applicant withdrew the application.

9The applicant further submits that he bore the cost of bringing this matter forward. The respondent is now attempting to overtake the applicant’s application rather than use their own funds to initiate a proceeding. The applicant argues that this is inappropriate and inconsistent with the consumer protection mandate of the Schedule.

10The respondent submits that the unreported case cited by the applicant is distinguishable from this case because the insurer in Gunasingam did not insist on continuing with the repayment issue. That is not the case here.

11I find that the repayment issue will proceed.

12The Tribunal cannot close files that have unresolved issues. The motion order dated March 30, 2023 added the repayment issue to this proceeding. This issue remains unresolved, even if the application is withdrawn. Thus, the repayment issue must proceed.

13Moreover, if the Tribunal closed the file in Gunasingam with an unresolved issue, then this was done in error.

14In regard to the late disclosure, the case conference order requires the respondent to disclose all surveillance evidence to the applicant by the end of November 2022. The applicant did not receive the third surveillance video until he received the brief. This disclosure is late and the applicant submits that he has not had a reasonable opportunity to review the material.

15The respondent submits that surveillance video was sent to the applicant in December, 2022. It subsequently came to the respondent’s attention that the third video was not included in the previously provided disclosure. The respondent immediately corrected this and sent the disclosure again. This was an inadvertent error and the video is relevant. For these reasons it should be admitted into evidence.

16I am entering the video into evidence. The lateness of this disclosure has been adequately explained as an inadvertent error and there is no clear indication of bad faith conduct on the part of the respondent. In regard to prejudice to the applicant, I find that the prejudice is not significant enough to exclude this disclosure. The applicant has seen the video and may provide testimony to address to any concerns. This opportunity to respond is meaningful and reasonably offsets any prejudice.

17At the start of the hearing, the respondent made a motion to exclude the Will Say Statement of Elengkumaran Thiyagarajah, the alleged employer of the applicant. He was summoned to testify, but was out of the country and unavailable for the hearing. The respondent submits that it is prejudiced by this document because it does not have the opportunity to test this evidence.

18The right to test evidence is important, but it is not an absolute right. The respondent can make submissions on how much weight is to be given to the document in light of the fact that this evidence is untested. In my view, this reasonably mitigates the prejudice.

ANALYSIS

Repayment of IRB

19The respondent is entitled to a repayment of the IRB.

20To receive an IRB under s. 5(1) of the Schedule, a person must be employed at the time of the accident and, as a result of and within 104 weeks after the accident, suffer a substantial inability to perform the essential tasks of that employment.

21Under section 52(1)(a) of the Schedule, a person is liable to repay the insurer any benefit paid 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.

22The Tribunal has defined “misrepresentation” as “any manifestation by words or other conduct by one person to another that, under the circumstances, amounts to an assertion not in accordance with the facts.”¹ The Tribunal has also held that “silence or a failure to report” may constitute wilful misrepresentation, depending on the circumstances.²

23The burden of proof rests with the respondent to establish, on a balance of probabilities, that it is entitled to a repayment.

24The applicant submitted a Disability Certificate to the insurer on or about May 5, 2021. This form was completed by Dr. Andrea Nalli, chiropractor. Dr. Nalli confirms that the applicant is substantially unable to perform the essential tasks of his employment for the next 9-12 weeks. On June 18, 2021, the respondent advised the applicant by letter that the information provided by the applicant indicates that he is eligible for an IRB.

25An insurer examination (IE) was conducted by Dr. Allan Peterkin, psychiatrist, on December 21, 2021. The applicant described the functional impairment of being unable to help with housework. Dr. Peterkin subsequently diagnosed the applicant has an adjustment disorder with depressed mood.

26The respondent determined that the applicant continued to be entitled to an IRB because, as noted in the respondent’s letter of December 23, 2021, “In the opinion of the psychological assessor the current psychological condition will prevent a return to pre-accident work at this time.” This statement is factually incorrect. Dr. Peterkin considered whether the applicant’s treatment should be held within the Minor Injury Guideline limits and his entitlement to a treatment plan. The IE report makes no comment on the applicant’s ability to perform the essential tasks of his employment or his entitlement to an IRB. It may be that the respondent misread or misunderstood Dr. Peterkin’s report. Insurer error is a ground for repayment. However, this issue was not identified at the hearing, nor did the parties make submissions on this issue. Thus, I am unable to consider it.

27In a letter dated September 14, 2022, the respondent advised the applicant that it was stopping the payment of the IRB. Under section 57(2) of the Schedule, a person entitled to an IRB shall obtain treatment and participate in such rehabilitation as is reasonable. The respondent’s position is that the applicant’s main injury was psychological and he had not attended any psychological treatment in contravention of s. 57(2).

28By letter dated October 17, 2022, the respondent advised the applicant that it obtained surveillance which shows him working and that he is therefore liable to repay the IRB.

29The respondent submits that the applicant was paid an IRB as a result of misrepresentation. The respondent determined that the applicant’s IRB entitlement was based on a psychological impairment. However, video surveillance establishes shows that he is able to engage in physical labour and work. This contradicts the information he provided to the IE assessor who diagnosed him with psychological impairments. As well, video surveillance establishes that the applicant was employed for a heating and cooling company while he was receiving the IRB from the respondent. As such, the Schedule requires him to repay the IRB.

30The applicant submits that no misrepresentation has taken place. The applicant has well-documented psychological limitations and the surveillance evidence is not sufficient to prove that he resumed working for a new employer. The applicant submits that this matter should be dismissed.

31I agree that there is some evidence that the applicant has psychological impairments. For example, he was prescribed Duloxetine, an anti-depressant. His prescription summary confirms that he filled this prescription between October 15, 2021 to September 9, 2022. This is consistent with having psychological sequalae. However, this evidence does not speak to the main issue which is that the applicant misrepresented his functional limitations to medical assessors.

32David McFadyen, investigator, issued a report dated December 8, 2021. It documents his observations of the applicant for five days, on November 10, 15, 20, 24, and 25, 2021.

33On November 15, 2021, video shows the applicant walking with an air compressor that he was using to apparently remove leaves and debris from his driveway. He also cleaned his front yard, landscaped the base of a tree, and appears to be repairing a fence. With the exception of two brief periods when he went inside his house, the applicant is engaged in these household chores over a two hour period.

34On November 17, 2021, the applicant attended the IE with Dr. Peterkin. As noted in the IE report, the applicant told Dr. Peterkin that “he is not able to help with housework physically, but does supervise his children.” This statement contradicts the surveillance video from two days before when he continuously participates in housework for two hours.

35The applicant did not testify at the hearing. As such, there is no explanation to account for this inconsistency.

36Dr. Betty Kershner, psychologist, examined the applicant on February 22, 2022 at his request. Her report states:

He does not feel helpful with chores: he “cannot do anything”. He feels useless and self-esteem is damaged. Mr. Balakrishnan cannot play with his children. He does not talk to others, just the one friend, due to pain. He is not interested, being unable to participate in anything. He prefers to avoid others.

37Dr. Kershner completed psychometric testing. On the Beck Depression Inventory-II (BDI-II) test, the applicant endorses the item “I don’t have enough energy to do anything.”

38Dr. Kershner diagnoses the applicant with post traumatic stress disorder, major depression, and a sleep disorder.

39Christopher Baily, investigator, issued a report dated April 14, 2022 that documents the applicant’s activities about a month after he was examined by Dr. Kershner.

40Video surveillance from March 31, 2022 covers a four hour period from 10:15AM to 2:10PM. During this time the applicant disposed garbage in an outdoor garbage bin; drove an elderly man to a grocery store, a Shoppers Drug Mart, and then returned home; he drove again to a grocery store, walked approximately 100 meters from his parking spot to the entrance of the store, pushed a shopping cart in the store, lifted four cases of water - each case containing 24 500ml bottles – into the shopping cart, went to the self checkout and used the scanning gun to purchase his items; he then returned to his car and loaded the four cases of water into his trunk, returned the shopping cart and drove away.

41The investigator’s report documents, and the video shows, a continuous four hour period where the applicant completes various tasks. I note that there is no indication in the video that the applicant struggled or had any difficulty with the completion of these tasks. This is inconsistent with the applicant’s statement to Dr. Kershner that he “cannot do anything.” This also contradicts his endorsement of the item “I don’t have enough energy to do anything” on the DBI-II test.

42Again, the applicant provided no testimony or submissions to account for this inconsistency.

43The respondent submits that the applicant worked for a heating and cooling company while he received an IRB. It bases this submission on a surveillance video from August 24, 2022 which shows the applicant dressed in coveralls and attending a job site where he carries a ladder into a house that has been gutted to the studs and framing.

44The applicant submits that he was there as an observer to learn the heating and cooling trade. He relies on a written statement provided by Elengkumaran Thiyagarajah, owner of AATEK, the company that hosted the applicant’s learning sessions. The statement indicates that over the course of multiple jobsite visits, Mr. Thiyagarajah showed the applicant the entire process of installing heating and cooling systems. Even so, the applicant did not perform any work and did not get paid for attending the jobsites.

45Mr. Thiyagarajah did not testify at the hearing and his written statement is untested. Nevertheless, the statement provides an explanation for what is seen in the video.

46The video evidence alone is not enough to find that the applicant was employed while receiving an IRB. However, it shows that the applicant is able to attend a job site and perform physical work.

47In submissions, the applicant acknowledges that he received an IRB based on the findings of an IE that assessed his psychological impairments. That finding was based, in part, on his functional inability to perform household tasks. The video evidence shows the applicant working in front of his house and in his yard for a two hour period, running errands and lifting heavy cases of water during a four hour period, and appearing at a job site and briefly performing some work. This video evidence directly contradicts what he told Dr. Peterkin. The applicant also misrepresented his functional limitations to his own assessor Dr. Kershner. This second example of the applicant overstating his limitations establishes a pattern of making factually incorrect statements to medical assessors. The applicant provided no evidence or submissions on why he overstated his functional limitations. In my view, the only reason to overstate functional limitations to would be to receive statutory accident benefits. This constitutes willful misrepresentation within the meaning of 52(1)(a) of the Schedule. As such, I find, on a balance of probabilities, that the applicant willfully misrepresented the extent of his functional limitations to Dr. Peterkin. I further find that the IRB was paid as a result of this wilful misrepresentation. Consequently, I also find that the applicant is liable to repay the IRB under 52(1)(a) of the Schedule.

48Under 52(2)(a) of the Schedule, the respondent must give the applicant notice of the amount to be repaid. I find that this requirement was satisfied by the respondent’s letter dated December 19, 2022 which advises the applicant that he is responsible to repay an IRB overpayment of $22,268.23. This amount is the entire IRB covering the period from March 30, 2021 to September 13, 2022.

49In the period between the accident and December 22, 2021, the applicant’s IRB was approved based on his disability certificate. The respondent has not pointed to any evidence which shows that the information on this form is factually incorrect. The respondent’s letter of December 23, 2021 states that the applicant “continues” to be entitled to an IRB given the findings of Dr. Peterkin. As such, the issue of wilful misrepresentation is applicable from December 23, 2021 and onwards.

50The respondent notes that the Tribunal ordered the applicant to disclose his employment file, employment insurance file, long and short term disability, and the collateral benefits file. This has not been done. Consequently, the respondent submits that the applicant is liable to repay the entire IRB. This reasoning is consistent with Aviva General Insurance Company v Gurung, 2021 CanLII 11858 (ON LAT). In that decision, the Tribunal found that the applicant has control of the information needed to calculate the quantum of IRB repayment, but no such documents were disclosed. This left the Tribunal no option but to order the entire amount of IRBs to be repaid. The same circumstances apply here.

51The applicant notes that he has already confirmed in writing to the respondent that he does not have any collateral benefits. The applicant notes that the respondent has been provided with three email requests for the applicant’s employment file. Moreover, the facts in Aviva v Gurung differ as the applicant in that case perjured herself.

52In the case cited by the respondent, the insured person had been working while receiving IRB’s for an unknown period of time. As such, the Member had no means of calculating the repayment. Those circumstances do not apply here. There is no clear evidence of the applicant being employed for an unknown period of time while collecting an IRB.

53The accounting statements of the applicant and the respondent for calculating the IRB are in evidence. The applicant’s EI payments are noted as being sourced from bank records. The only missing information appears to be whether there were any payments from long term or short term disability. Given that the applicant’s bank records have been reviewed by accountants, I am not persuaded that this gap in the evidence justifies a finding that the entirety of the IRB should be repaid.

54The only limitation to the repayment of an income replacement benefit is in 52(3) of the Schedule which requires the notice of repayment to be given within 12 months after the payment of the amount that is to be repaid. This does not apply if the benefit was originally paid as a result of misrepresentation. As the IRB was paid as a result of misrepresentation, I further find that the 12 month notice requirement is not applicable and that the applicant is liable to repay the entire amount of the IRB.

55The applicable period of wilful misrepresentation is from December 23, 2021 and onwards. As such, I find that the applicant is liable to repay the amount of $291.36 per week from December 23, 2021 to September 13, 2022 . The period consists of 37 weeks and 5 days. The quantum of repayment is calculated as follows:

a) $291.36/week x 37 weeks = $10,780.32

b) $291.36/week divided by 7 days = $41.62 per day

c) $41.62 per day x 5 days = $208.10

d) $10,780.32 + $208.10 = $10,988.42

56As such, I find that the applicant is liable to repay $10, 988.42.

Interest

57Section 52(5) and (6) of the Schedule allows the respondent to charge interest on the outstanding balance of the amount to be repaid from the 15th day after the notice of repayment is given until the day repayment is received in full. The interest rate is the minimum rate at which the Bank of Canada makes short term advances to the banks listed in Schedule I of the Bank Act.

58The respondent’s notice to repay the IRB, dated December 19, 2022, asks for a repayment of $22,268.23. The notice does not indicate that the respondent is charging interest.

59Neither the respondent nor the applicant makes no submissions on interest.

60The respondent’s IRB repayment notice does not indicate that it is charging interest on the outstanding balance and the respondent made no submissions on this point. As such, there is no basis to justify its entitlement to interest. For these reasons, I find that the respondent is not entitled to interest on the repayment.

ORDER

61I order the following:

i. The applicant is liable to repay $10, 988.42.

ii. The respondent is not entitled to interest.

Footnotes

1. 117-000272 v T.T., 2017 CanLII 87539 (ON LAT), at para 21-22, citing Blacks Law Dictionary (Revised Fourth Edition, St. Paul, Minnesota: West Publishing Co, 1968, at p. 1152).
2. 2Ibid, at para 28.