Helena Kurgan v. Aviva Insurance Company of Canada, 2023 CanLII 122880

22-007046/AABS-PI

Licence Appeal Tribunal File Number: 22-007046/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:

Helena Kurgan

Applicant

and

Aviva Insurance Company of Canada

Respondent

PRELIMINARY ISSUE HEARING DECISION AND ORDER

ADJUDICATOR:

Tavlin Kaur

APPEARANCES:

For the Applicant:

Helena Kurgan, Applicant

Kameliya Stancheva, Paralegal

For the Respondent:

Sophia Chaudri, Counsel

Heard by way of written submissions

BACKGROUND

1Helena Kurgan, the applicant, was involved in an automobile accident on November 21, 2020 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, Aviva Insurance Company of Canada, and applied to the Licence Appeal Tribunal - Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.

ISSUES IN DISPUTE

Preliminary Issues

2The preliminary issues to be decided at the hearing are:

i. Whether the applicant is barred from proceeding with her claim for medical benefits on the ground that the respondent provided the applicant with notice that it requires an examination under s. 44 of the Schedule, but the applicant has not complied with that section.

ii. Whether the applicant is barred from proceeding with her claim for attendant care benefits (“ACB”) and non-earner benefits (“NEB”) as she failed to notify the respondent of the circumstances giving rise to a claim for those benefits.

iii. Whether the applicant is barred from proceeding with her claim for ACBs and NEBs as she failed to submit an application for the benefit within the times prescribed by this Regulation.

RESULT

3The applicant is not barred from proceeding with respect to medical benefits.

4The applicant is barred from proceeding with respect to ACBs and NEBs.

Issue i

5The respondent submits that the applicant has been provided with several notices to attend the insurer examinations (“IEs”). However, she has refused to attend and has not provided a reason for her non-attendance. It is the respondent’s position that the applicant should be barred from proceeding with her application.

6The applicant did not address this issue in her submissions.

7Section 44(1) of the Schedule provides that, for the purposes of assisting an insurer to determine if an insured person is or continues to be entitled to a benefit for which an application is made, but no more often than is reasonably necessary, an insurer may require an insured person to be examined by one or more persons chosen by the insurer who are regulated health professionals or who have expertise in vocational rehabilitation.

8The requirements for a Notice of Examination are set out in section 44(5) of the Schedule:

(1) If the insurer requires an examination under this section, the insurer shall arrange for the examination at its expense and shall give the insured person a notice setting out,

(a) the medical and any other reasons for the examination;

(b) whether the attendance of the insured person is required at the examination;

(c) the name of the person or persons who will conduct the examination, any regulated health profession to which they belong and their titles and designations indicating their specialization, if any, in their professions; and

(d) if the attendance of the insured person is required at the examination, the day, time and location of the examination and, if the examination will require more than one day, the same information for the subsequent days.

9Section 44(9)2. sets out the rules for an in-person insurer examination:

(2) If the attendance of the insured person is required,

(a) the insurer shall make reasonable efforts to schedule the examination for a day, time and location that are convenient for the insured person,

(b) the insured person and the insurer shall, not later than five business days before the day scheduled for the examination, provide to the person or persons conducting the examination such information and documents as are relevant or necessary for the review of the insured person’s medical condition, and

(c) the insured person shall attend the examination and submit to all reasonable physical, psychological, mental and functional examinations requested by the person or persons conducting the examination.

10Section 55(1)2 of the Schedule provides that an insured person shall not apply to the Tribunal if the insurer has provided the insured person with notice that it requires an examination under section 44, but the insured person has not complied.

11Given the above provisions, the Schedule is clear that the applicant has a duty to participate in each in-person IE that is reasonably necessary and for which there is a Schedule-compliant notice. If the applicant fails to comply, there must be a reasonable explanation provided for the non-compliance.

12To be clear, the respondent must first prove that a Notice of Examination complies with section 44(5) of the Schedule in order to statute-bar an applicant under section 55. In seeking such a remedy, the respondent must ensure that it provides specific details of the applicant’s conditions, the benefit in dispute and any section it relies upon. ¹

13It is well-settled that the insurer’s medical and any other reasons should 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. The “medical and any other reasons” should be clear and sufficient enough to allow an unsophisticated person to make an informed decision on whether to attend the IE.

14Moreover, it is trite law 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 to decide whether or not to challenge the insurer’s determination.

15I note that according to Smith v. Co-operators General Insurance Co, 2002 SCC 30 (“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. [my emphasis added]. Defining 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.

16Accordingly, Smith requires a denial notice to be as specific and accessible as possible to ensure that there is no ambiguity in what they mean when read by an unsophisticated person. This means the notice at the very least should explain what the insured person’s medical conditions are and why those conditions do not justify removal from the MIG. An individual might not understand why their medical conditions are considered to be minor if they are not provided with more context. By providing this information, the insured person will have a better understanding of the insurer’s determination. It is only then that the consumer protection mandate of the Schedule is achieved.

17Therefore, the notice requirements set out in section 44(5) should be strictly construed and the notice should be closely examined to ensure it complies. If the respondent’s notice does not comply with section 44(5), an insurer cannot rely on the severe remedy available in s. 55 of the Schedule to bar an insured’s application from proceeding before the Tribunal.

The Notices of Examination are not in compliance with s. 44(5)

Notices of examination dated May 16, 2022 and June 21, 2022

18I find that the notice of examination dated May 16, 2022 did not comply with section 44(5) of the Schedule. It is quite vague and fails to refer to the applicant’s medical condition(s). The medical reasons provided are: “There appear to be pre-existing or concurrent medical conditions [sic] exist that might affect the patient's care, treatment, and prognosis. The type(s) of treatment does not appear consistent with the patient's diagnosis. The patient does not appear to show objective signs of improvement despite continuing treatment.” It is unclear what the pre-existing or concurrent medical conditions are. The respondent should have provided some context regarding what these conditions are. The respondent did not cure this notice in the subsequent notice dated June 21, 2022. Therefore, I find the notices to be deficient. This treatment plan will proceed to the substantive issues hearing.

Issues ii and iii: The applicant is barred from proceeding with her claim for the NEB.

19For issues ii and iii, I will address the NEB and ACB separately.

An OCF-3 that does not support entitlement does not render it incomplete

20A significant portion of the respondent’s submissions are focused on the argument that if an OCF-3 that does not support entitlement, this renders it incomplete. I will address this argument first before I address whether the applicant met the timelines in ss 32(1) and 32(5). The respondent submits that the applicant has failed to provide an OCF-3 which supports her entitlement to the NEB. The respondent asserts that the OCF-3 has to support entitlement to the NEB and that an applicant who fails to submit a completed OCF-3 is not entitled to a specified benefit for any period before the completed OCF-3 is provided. It is the respondent’s position that section 36(3) logically presumes that the OCF-3 provided supports entitlement to a specified benefit. Accordingly, the respondent submits that the applicant’s failure to provide an OCF-3 supporting entitlement is fatal to her claim.

21As such, it is the respondent’s position that the applicant failed to notify the respondent of the circumstances giving rise to a claim for NEB pursuant to section 12 of the Schedule or submit an application for the benefit within the times prescribed by the Schedule. The respondent relies on Steele v. Intact Insurance Company, 2014 ONSC 6999 (“Steele”) and Volpe v. Co-operators General Insurance Company, 2017 ONSC 261 (“Volpe”).

22For reasons unknown, the applicant did not address this issue in her submissions and nor did she provide any case law or evidence in support of her case.

23Section 32(5) requires that an applicant submit a completed and signed application for benefits to the insurer within 30 days after receiving the application forms. Section 36(2) of the Schedule states that in order to claim for a specified benefit, in this case, the NEB, the applicant shall submit a completed Disability Certificate (“OCF-3”) with his or her application. Therefore, the correct limitation period to submit the OCF-3 along with the OCF-1 remained 30 days after receiving the application forms from the respondent, as provided by section 32. Pursuant to section 36(3) of the Schedule, an applicant who fails to submit a completed OCF-3 is not entitled to a specified benefit for any period before the completed OCF-3 is submitted.

24I am not persuaded by the respondent’s position. My interpretation of sections 36(2) and (3) is that an applicant must submit a completed OCF-3 along with his/her application. These sections do not make any reference to whether or not the applicant must meet the substantial inability test. Moreover, I note that the respondent did not direct the Tribunal to any other deficiencies in the OCF-3. Adopting the interpretation of the legislation proffered by the respondent would be inconsistent with the consumer protection nature of the Schedule. By way of this logic, any OCF-3 that does not support entitlement to a specified benefit would be considered to be incomplete and could preclude applicants from applying to the Tribunal for dispute resolution. I do not believe this to be the intent of the legislature or else it would have been clearly expressed in the legislation.

25Moreover, I am not persuaded by the case law that the respondent is relying on. In Steele, the questions related to the criteria for the NEB and caregiver benefits were not answered. The defendant found the plaintiff to be eligible for income replacement benefits for the prescribed period for her injury. The plaintiff was denied the NEB because she was working at the time of the accident. A few years later, the plaintiff’s lawyer wrote to the defendant to claim that it should have advised the plaintiff to consider electing the NEB. The plaintiff did not file an OCF-3 that certified that she suffered a complete inability to carry on a normal life. The Court found that the defendant was entitled to summary judgment on the ground that the plaintiff has never filed the OCF-3 that certifies that she meets the criterion for NEB. The action was dismissed on summary judgment on the ground that it had been filed after the expiry of the limitation period in the Insurance Act.

26I find Steele to be distinguishable from the current application because the focus in that case was the limitation period. The claimant was sent notice denying benefits and was attempting to pursue dispute resolution long after the two-year limitation period had ended.

27In my view, Volpe is distinguishable from the facts before me because the applicant submitted a completed OCF-3 to the respondent. In Volpe, the applicant did not submit a completed OCF-3 to the respondent. Rather, the applicant’s counsel forwarded a letter to the respondent stating that the applicant was applying for the NEB:

28I find that the applicant sent the respondent a completed OCF-3. The fact that her health practitioner noted that she did not meet the applicable test for the NEB did not render the OCF-3 incomplete. Moreover, the respondent did not deny the application for the NEB on the basis that it was incomplete. Rather, it was denied because the applicant did not meet the test for the benefit. In my view, an OCF-3 that does not support entitlement does not render it as incomplete. As long as all of the fields are filled out, then it is a completed OCF-3 and would meet the requirements under section 36(2).

The applicant did not comply with the timelines set out in ss. 32(1) and 32(5)

29I find that the applicant did not comply with sections 32(1) and 32(5) of the Schedule. The respondent became aware of the fact that the applicant was seeking accident benefits on December 10, 2023. On the same day, the respondent sent her the application package. A completed OCF-3 was submitted to the respondent on January 22, 2021 and the OCF-1 was submitted on January 28, 2021. The OCF-1 and OCF-3 were submitted more than 30 days after the applicant received the application package.

30I note that section 34 of the Schedule states that “a person’s failure to comply with a time limit set out in this Part does not disentitle the person to a benefit if the person has a reasonable explanation.” The onus is on the applicant to establish a reasonable explanation for the delay. The interpretation of “reasonable explanation” is guided by Horvath and Allstate Insurance Company of Canada, FSCO A02-000482, June 9, 2003, and was more recently reiterated in K.H. vs Northbridge, 2019 CanLII 101613 (ON LAT). The guiding principles are summarized as follows:

1. An explanation must be determined to be credible or worthy of belief before its reasonableness can be assessed.

2. The onus is on the insured person to establish a “reasonable explanation.”

3. Ignorance of the law alone is not a “reasonable explanation.”

4. The test for “reasonable explanation” is both a subjective and objective test that should take account of both personal characteristics and a “reasonable person” standard.

5. The lack of prejudice to the insurer does not make an explanation automatically reasonable.

6. An assessment of reasonableness includes a balancing of prejudice to the insurer, hardship to the claimant and whether it is equitable to relieve against the consequences of the failure to comply with the time limit.

31The applicant’s submissions are silent on why there was a delay. As such, I find that the applicant did not notify the respondent of the circumstances of giving rise to a claim and nor did she submit the application for the benefit within the times prescribed in the Regulation. Therefore, she cannot apply to the Tribunal under subsection 280(2) of the Act.

The applicant is barred from proceeding with her claim for the ACB

32The respondent submits that the applicant failed to submit the Form 1 to the Health Claims for Auto Insurance site (“HCAI”) and therefore it is deemed to not have been received. The applicant did not address this issue in her submissions.

33On January 28, 2022, the respondent sent a letter to the applicant informing her that they received an email from her legal representative which included a copy of an Assessment of Attendant Care Needs (Form 1) with an invoice for attendant care services in the amount of $33,072.00 for benefits incurred from the date of loss to December 31, 2021. The applicant was advised that this type of assistance may be covered under the attendant care benefit. However, the respondent informed the applicant that the Form 1 needed to be submitted by her health care provider through the HCAI site. As the Form 1 was not submitted through HCAI, the respondent was unable to determine the applicant’s eligibility for the attendant care benefit. She was advised to follow up with her doctor or health care provider regarding the status of this form.

34On May 31, 2022, the respondent sent an email to the applicant’s legal representative and advised them that the clinic did not provide the Form 1 through HCAI. As such, they are not required to pay for any expenses related to the attendant care incurred before a Form 1 has been received. The applicant was advised to follow up with her doctor or healthcare provider regarding the status of this form.

35I find that the applicant failed to submit the OCF-1 through HCAI. Pursuant to 268.3(1) of the Insurance Act, the Chief Executive Officer may issue guidelines on the interpretation and operation of the Schedule or any provision of the Schedule. Section 268.3(2) states that subject to section 268.2, a guideline shall be considered in any determination involving the interpretation of the Schedule.

36The relevant guideline in the facts before me is the Revised Health Claims for Auto Insurance Guideline – Including the Assessment of Attendant Care Needs Form (Form 1). This guideline was released by the Financial Services Commission of Ontario on January 4, 2018 and I note that the status of this guideline is listed as active. According to this Guideline, effective October 1, 2018, insurers and health care providers must use HCAI for submitting and processing the Form 1. All facilities enrolled with HCAI must submit Form 1 to insurers electronically, using either a Practice Management System that is integrated with HCAI or the HCAI web channel.

37There is no evidence that shows that the Form 1 was submitted through HCAI. Pursuant to section 42(5) of the Schedule, an insurer may, but is not required to, pay an expense incurred before an assessment of attendant needs that complies with this section is submitted to the insurer. In the absence of any other evidence, the respondent is not required to fund this benefit.

ORDER

1. It is ordered that the applicant can proceed with issue i.
2. It is ordered that the applicant is barred from proceeding with issues ii and iii.

Released: June 13, 2023

___________________________

Tavlin Kaur

Adjudicator

Footnotes

1. 1The Divisional Court in Hedley v. Aviva Insurance Company of Canada, 2019 ONSC 5318 considered the Tribunal’s reconsideration decision of B.H. v. Aviva Insurance Company, 2018 CanLII 84051 (ON LAT), which in turn applied 16-003316/AABS 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. In T.F, Executive Chair Lamoureux repeated her comments from M.B. in paragraph 19 in relation to medical and any other reasons.