ONLAT 23-002580/AABS-PI
Licence Appeal Tribunal File Number: 23-002580/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:
Perry Zolis
Applicant
and
BelairDirect Insurance Company
Respondent
PRELIMINARY ISSUE HEARING DECISION AND ORDER
ADJUDICATOR:
Tavlin Kaur
APPEARANCES:
For the Applicant:
Mike Pryce, Paralegal
For the Respondent:
Kathy Conteh, Counsel
HEARD:
By way of written submissions
OVERVIEW
1Perry Zolis, the applicant, was involved in an automobile accident on October 17, 2019, 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, BelairDirect Insurance Company(“Belair”), and applied to the Licence Appeal Tribunal – Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.
PRELIMINARY ISSUE IN DISPUTE
2The preliminary issue to be decided is whether the applicant is barred from proceeding with his claim for benefits because he failed to commence his application within two years after the respondent’s refusal to pay the amount claimed.
RESULT
3The applicant is barred from proceeding with the treatment plan in the amount of $1,072.60 for physiotherapy services.
4The applicant is not barred from proceeding with the treatment plan in the amount of $2,070.48 for chiropractic services.
ANALYSIS
Background
5On July 17, 2020, the respondent denied the treatment plan in the amount of $1,072.60 for physiotherapy services. The applicant attended insurer examinations for the purpose of determining whether the treatment plan was reasonable and necessary. On September 17, 2020, the respondent upheld the denial of the treatment plan.
6On June 3, 2020, the respondent denied the treatment plan in the amount of $2,070.48 for chiropractic services. The applicant attended insurer examinations for the purpose of determining whether the treatment plan was reasonable and necessary. On September 17, 2020, the respondent upheld the denial of the treatment plan.
7The applicant filed his application with the Tribunal on March 7, 2023.
Parties’ positions
8The respondent submits that each denial was clear and unequivocal. The denial letters provided reasons for the denial and the description of the dispute resolution process. The applicant did not dispute the denials within two years.
9The applicant did not file any submissions or evidence in support of his case.
The Law
10Section 56 of the Schedule provides that an application to dispute a denial of a benefit shall be commenced within two years of the insurer’s refusal to pay.
11In order for the provision under section 56 to be triggered, I must determine whether the respondent’s notice of denial was proper in accordance with the principles set out in Smith v. Co-operators General Insurance Co, 2002 SCC 30 (“Smith”). According to Smith, the refusal to pay the benefit must contain straightforward and clear language, it must be directed towards an unsophisticated person, it must outline the dispute resolution process and the relevant time limits that govern the process, and it must provide valid or other reasons for the denial.
12Defining with precision an unsophisticated person is a challenging task; however, the Court’s direction in Smith clearly recognizes that greater accessibility of an insured person to the informational content of the denial notice is of paramount importance and must necessarily account for the variety of persons and backgrounds who may make claims for accident benefits. Accordingly, Smith requires a denial notice to be as specific and accessible as possible to ensure that there is no ambiguity in what a notice means when read by an unsophisticated person.
13Further, the notice must provide a valid medical and any other reason for the denial. I note that the Divisional Court in Hedley v. Aviva Insurance Company of Canada (“Hedley”), 2019 ONSC 5318 considered the reconsideration decision of B.H. v. Aviva Insurance Company, which in turn applied T.F. v. Peel Mutual Insurance Company, 2018 CanLII 39373 (ON LAT) (“T.F.”). The Court found no basis to intervene as the decision was within the reasonable range of outcomes.
14The principles were set out by the Tribunal in T.F. in which Executive Chair Lamoureux stated, at para. 19:
[…] an insurer’s “medical and any other reasons” should, at the very least, include specific details about the insured’s condition forming the basis for the insurer’s decision or, alternatively, identify information about the insured’s condition that the insurer does not have but requires. Additionally, an insurer should also refer to the specific benefit or determination at issue, along with any section of the Schedule upon which it relies. Ultimately, an insurer’s “medical and any other reasons” should be clear and sufficient enough to allow an unsophisticated person to make an informed decision to either accept or dispute the decision at issue. Only then will the explanation serve the Schedule’s consumer protection goal.
15This means the notice at the very least should explain what the insured person’s medical conditions are and why those conditions do not justify entitlement to the benefit claimed. By providing this information, the insured person will have a better understanding of the insurer’s determination. It is then that the consumer protection mandate of the Schedule is achieved.
16Moreover, I note that the Court in Hedley found that boilerplate medical reasons for denials of treatment plans submitted under the Schedule constitute as no reasons at all. Reasons must be meaningful in order to permit the insured person to decide whether or not to challenge the insurer’s determination.
17If an insurer’s notice of denial to an insured person does not satisfy these requirements, the denial may be determined to be invalid and fail to trigger the two-year limitation period.
18However, if the notice of denial does satisfy these requirements, then the onus is on the applicant to establish reasonable grounds for an extension under Section 7 of the Licence Appeal Tribunal Act, 1999 (“LAT Act”). Section 7 allows the Tribunal to extend a limitation period for filing an appeal to it. In considering whether to exercise its discretion to extend the limitation period, the Tribunal must consider the following four factors to determine if the justice of the case requires the extension:
a) A bona fide intention to appeal within the limitation period;
b) The length of delay;
c) Prejudice to the other party; and
d) Merits of the appeal.
19No one factor is determinative in this analysis.
Reopening Ontario (A Flexible Response to COVID-19) Act, 2020, Ontario Regulation 73/20 (“O. Reg 73/20”)
20The dates regarding the limitation period to dispute the denials in the chart provided by the respondent are incorrect. On March 20, 2020, Ontario enacted O. Reg. 73/20. This regulation suspended limitation periods retroactively from March 16, 2020 and was repealed on September 14, 2020. This legislation was in force for 183 days. This was affirmed in McAuley v Canada Post Corporation, 2021 ONSC 4528, where the Ontario Superior Court of Justice found that O. Reg. 73/20 extended all running limitation periods by 183 days.
21The limitation period for this application can therefore be extended by 183 days. In the facts before me, the applicant had until January 16, 2023 to dispute the treatment plan in the amount of $1,072.60 for physiotherapy services and December 3, 2022 to dispute the treatment plan for plan in the amount of $2,070.48 for chiropractic services.
Denial letter dated July 17, 2020 is valid
22In my view, the denial letter dated July 17, 2020 is valid. Reasons for the denial are provided. The respondent has identified the applicant’s medical conditions. The denial letter notes that the applicant has musculoskeletal injuries. The benefit in dispute has been properly identified and the applicant was provided with information regarding his right to appeal the decision. In my view, the reasons were clear and sufficient to allow an unsophisticated person to make an informed decision to either accept or dispute the decision at issue. I find that this was a clear and unequivocal denial.
Denial letter dated June 3, 2020
23In my view, the denial letter dated June 3, 2020 is deficient. The reasons provided are vague. There are no references made to his medical conditions. It is unclear what his medical conditions or impairments are. The respondent did not identify the information that it requires. Moreover, there is no explanation regarding how having a pre-existing injury may result in the individual being removed from the Minor Injury Guideline (“MIG”). This explanation is not geared towards an unsophisticated party.
24Furthermore, it appears that the respondent has used boilerplate wording and therefore, these reasons constitute as no reasons at all in accordance with Hedley. I find that the letter dated June 3, 2020 is not in compliance with s. 38(8) of the Schedule. The respondent did not cure this in the subsequent denial letter. In my view, the notice of denial did not meet the basic requirements outlined in Smith and therefore the two-year limitation period was not triggered. The respondent did not cure this in the subsequent denial letter. As such, the applicant may proceed with this treatment plan.
Section 7 of the LAT Act
25The applicant did not request an extension of the limitation period and as a result has not met his onus to establish reasonable grounds for an extension under section 7 of the LAT Act. I decline to exercise my discretion to extend the deadline for the treatment plan in the amount of $1,072.60 for physiotherapy services.
ORDER
26It is ordered that the applicant is barred from proceeding with the treatment plan in the amount of $1,072.60 for physiotherapy services.
27It is ordered that the applicant may proceed with the treatment plan in the amount of $2,070.48 for chiropractic services.
28Except for the provisions contained is this order, all previous orders made by the Tribunal remain in full force and effect.
Released: December 5, 2023
___________________________
Tavlin Kaur
Adjudicator