Citation: Aviva General Insurance v. Modi, 2023 ONLAT 20-008083/AABS

Licence Appeal Tribunal File Number: 20-008083/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:

Aviva General Insurance

Applicant

and

Rajiv Modi

Respondent

DECISION

ADJUDICATOR:

Brian Norris

APPEARANCES:

For the Applicant:

Melanie A. Sousa, Counsel

For the Respondent:

Yousef Jabbour, Counsel

HEARD: By way of written submissions

OVERVIEW

1Rajiv Modi (“Modi”) was involved in an automobile accident on January 25, 2017 and sought benefits from Aviva General Insurance (“Aviva”) pursuant to the Statutory Accident Benefits Schedule - Effective September 1, 2010 (including amendments effective June 1, 2016) (the “Schedule”).

2Aviva paid income replacement benefits (“IRBs”) to Modi following the accident. However, it determined that Modi returned to work but never advised Aviva that he did. As a result, Aviva requested a repayment of IRBs in the amount of $8,800.00. It later revised its request and sought a repayment of $18,000.00. Modi refused to repay the benefits and Aviva applied to the Licence Appeal Tribunal - Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.

ISSUES

3The issue in dispute is:

i. Is Aviva entitled to a repayment of IRBs paid during the period from March 22, 2017 to January 31, 2018, in the amount of $18,000.00, plus interest?

RESULT

4Modi is ordered to pay Aviva $8,800.00 plus interest pursuant to section 52(5) of the Schedule, effective 15 days from August 30, 2018.

ANALYSIS

5Modi was the driver of a vehicle which collided with an oncoming vehicle on a suburban roadway. It is undisputed that Modi sustained a fractured hip as a result of the accident. Understandably, Modi’s injuries prevented him from working and Aviva paid him IRBs at the rate of $400.00 per week, effective February 1, 2017.

6Aviva continued to pay IRBs to Modi until January 24, 2018. In a letter dated February 26, 2018, Aviva advised Modi that it was discontinuing his IRBs because he resumed his pre-accident employment duties. The letter also requested updated clinical notes and records (“CNRs”) from Modi’s family physician, Dr. Khan, and a copy of the Modi’s medical benefits file originating from a different accident, per a prior request.

7The February 26, 2018 letter also referred to a conversation with Modi’s legal representative at that time, who indicated to Aviva that Modi returned to work in March 2017. As a result, Aviva requested that Modi provide an exact date he returned to work as well as income documents such as personal, business, and corporate tax returns.

8Aviva wrote to Modi again on May 4, 2018 to advise that it was suspending his IRBs effective May 4, 2018 (in addition to the previous suspension referred to in the January 30, 2018 letter). Aviva reiterated its request for Modi’s income documents. The requests for information on Modi’s post-accident income or loss continued to go unanswered.

9Nevertheless, Aviva commissioned insurer’s examinations (“IEs”) to determine Modi’s ongoing entitlement to IRBs, which Modi attended. The IE assessors concluded that Modi did not meet the test for disability for IRBs. Aviva conveyed this to Modi by letter dated August 30, 2018, which also reiterated Aviva’s request for post-accident income documents.

10The August 30, 2018 letter from Aviva also advised Modi that it was aware that he returned to work in some capacity and that it had not received the information required to calculate the amount of the repayment, if any. As a result, it concluded that Modi misrepresented his work status and requested a repayment of IRBs paid during the period from August 30, 2017 to August 30, 2018, totalling $8,800.00.

11Aviva’s letter dated August 30, 2018 went unanswered and it sent another request to Modi on September 30, 2019. That letter noted that Modi never responded to prior requests for income documents, pursuant to section 33 of the Schedule and reiterated the request once again. The letter also noted that the overpayment may likely be as much as $18,000.00, depending on Modi’s post-accident financial documents. Aviva’s letter requested repayment of the “full amount”.

12Aviva initiated an application with the Tribunal and a case conference occurred. At the case conference the Tribunal ordered that Modi provide the various personal, business, and corporate income and tax documents by a production deadline. Most, but not all the documents, were provided by Modi to Aviva by the deadline.

13Aviva created an Internal IRB Overpayment Report, dated February 24, 2022 (“the IRB overpayment report”), based on the documents provided by Modi. The IRB overpayment report demonstrates that Modi’s business income increased in the years following the accident. Though the IRB overpayment report also notes that Modi’s net income decreased following his accident, the document also shows the decrease concurs with an increase in business expenditures such as vehicle rental, insurance, and fuel. These are not accident-related losses. Further, Modi incurred no increased expenses for subcontracts in 2017.

14Modi does not dispute Aviva’s representations of his business income in any manner. Instead, Modi’s submissions focus primarily on his injuries and the opinions of various assessors to indicate that he meets the disability test for IRBs. In fact, his submissions maintain that his medical records indicate an inability to work, thus entitling him to IRBs.

15For the following reasons, I find that Modi misrepresented his return-to-work status and Aviva is entitled to a repayment of IRBs as a result. However, I find that Aviva’s entitlement to a repayment is limited to $8,800.00 – the amount Aviva notified Modi about.

I find that Modi returned to work

16I find that Modi returned to work as a truck driver by no later than July 18, 2017, and likely as early as March 23, 2017.

17Modi applied for accident benefits related to a July 18, 2017 accident. Aviva obtained the accident benefit file following Modi’s authorization, dated May 10, 2018. The application for benefits dated August 30, 2017 indicates that Modi was the seat-belted driver of a truck which was parked for unloading when it was struck by a third-party vehicle. Modi provided a signed statement to his insurer for the July 18, 2017 accident, which states that he was working as a truck driver at the time of that accident and that he was also involved in another accident in Minnesota in August 2017. Additionally, Transcon Logistics Ltd., which appears to have subcontracted work to Modi following the subject accident, advised that Modi was making transport trips for the company effective March 23, 2017.

18Next, an Ohio Traffic Crash Report dated July 18, 2017 states that Modi was the driver of a truck that was parked in a loading dock when it was struck by another vehicle that reversed into his truck. The information in the Ohio Traffic Crash Report corresponds with a statement in Dr. Khan’s CNRs, dated March 25, 2017, which notes that Modi returned to driving his truck.

19Modi’s reports to assessors during IE examinations indicate that he returned to work in 2017. In the June 4, 2018 IE report by Dr. N. Alikhan, physician, it notes that Modi reported that he returned to work about three to five months following the subject accident and was involved in a subsequent accident in July 2017. In the August 7, 2018 report by Dr. C. Hope, psychologist, Modi reported that he was involved in another motor vehicle accident in July 2017, which occurred in Ohio. Lastly, the orthopaedic assessment report by Dr. G. Y. M. Yee, dated August 7, 2018, states that Modi reported that he took four to five months off work following the subject accident.

20While it is possible and likely that Modi started working as early as March 23, 2017, I am absolutely certain that he returned to work by no later than July 18, 2017. The Ohio Traffic Crash Report and the accident benefit file clearly state that Modi was involved in an accident on July 18, 2017, while working. Thus, I conclude that he returned to work by no later than July 18, 2017.

Statutory implications of Modi’s return-to-work

21I find that Modi’s return-to-work demonstrates that he does not meet the disability test for IRBs, despite his submissions. Section 37(2)(e) of the Schedule permits Aviva to discontinue paying IRBs because Modi returned to his pre-accident employment duties.

22Section 37(2)(e) of the Schedule provides that an insurer shall not discontinue paying a specified benefit to an insured person unless the insured person has resumed his or her pre-accident employment duties. In this case, Aviva is permitted to stop payment of IRBs to Modi because, as determined earlier, Modi returned to his pre-accident duties as a transport truck driver. Modi’s comments to assessors and the evidence that he resumed his employment as a truck driver demonstrate that he does not meet the disability test for IRBs.

23I acknowledge that Modi sustained a fractured hip and likely developed psychological injuries as a result of the accident. However, Modi’s IRB claim is fluid and involves ongoing entitlement to the benefit and also the quantum of weekly benefits. The latter is intrinsically connected to Modi’s post-accident earnings – which Aviva is permitted to deduct from Modi’s IRB payments. The evidence discussed earlier clearly demonstrates that Modi mitigated his loss and returned to work as a truck driver. This evidence overwhelmingly outweighs all the medical evidence and Modi’s failure to explain why the records state that he was working in the spring and summer of 2017 is remarkable.

24Even if I found that Modi continued to meet the disability test following his return to truck driving, the fact that he failed to disclose that he was working and earning an income and continues at this hearing to claim an inability to work in light of the overwhelming evidence to the contrary, demonstrates that the misrepresentation is wilful and clearly in an effort to mislead not only Aviva but also the Tribunal.

Aviva’s entitlement to a repayment is limited to the amount it notified Modi about

25I find that Aviva is entitled to a repayment of $8,800.00 because that is the amount it notified Modi that he was required to repay.

26Section 52(1)(a) of the Schedule provides that a person is liable to repay a benefit to an insurer if the benefit is paid as a result of an error or wilful misrepresentation or fraud.

27However, in order to claim a repayment, the insurer is required to notify the insured person of the amount that they are required to pay, pursuant to section 52(2)(a).

28In this case, Aviva unequivocally notified Modi that it seeks $8,800.00. All other requests for payments in evidence are equivocal and I find that I am unable to order payment for an amount which Modi has not been notified of.

29I find that Aviva’s notice dated August 30, 2018 is a valid notice pursuant to section 52(a) of the Schedule. The letter clearly stipulated to Modi that Aviva sought repayment of IRBs paid between August 30, 2017 to present, in the amount of $8,800.00. It reasoned that evidence suggested that Modi returned to pre-accident employment as a truck driver and that Aviva was entitled to information regarding his return to work but had not been provided the same.

30For clarity, I note that section 52(2)(a) of the Schedule does not require the notice to include the reason(s) for the repayment. The only stipulation is that the person be given notice of the amount of the repayment. Thus, while Aviva’s notice never included reference to wilful misrepresentation or that Modi was disqualified from receiving IRBs, it nevertheless notified him that it sought a repayment of IRBs in the amount of $8,800.00.

31Aviva has provided no evidence that it unequivocally sought repayment in a different amount. The September 30, 2018 letter referred to in its submissions states that it is “possible” that the overpayment is up to $18,000.00. To me, stating that the amount of repayment may be up to a certain amount is too ambiguous for an unsophisticated claimant to make an informed decision to comply or dispute the request. Given that none of Aviva’s subsequent requests provide an unequivocal notice of a different amount, I conclude that Aviva is entitled to a repayment of $8,800.00 only.

Interest

32Interest applies on the overdue repayment of benefits pursuant to s. 52(5) of the Schedule. The calculation of the interest period starts on the 15th date following the notice dated August 30, 2018 as that is the date of Aviva’s compliance notice.

Costs

33I find that Aviva is entitled to costs in the amount of $250.00 because Modi acted unreasonably during the proceeding.

34Aviva seeks an Order for costs in the amount of $500.00, pursuant to Rule 19 of the Common Rules of Practice and Procedure, October 2, 2017 (“the Rules”). It submits that Modi failed to submit a response and case conference summary, failed to attend two case conferences, and failed to produce documents that he was ordered to produce, despite numerous attempts by Aviva to follow-up on their production. Modi never addressed Aviva’s request for costs, but in conclusion submitted that Aviva’s application should be dismissed with costs.

35Pursuant to rule 19.1 of the Rules, costs may be requested where a party believes another party has acted unreasonably, frivolously, vexatiously, or in bad faith. Rule 19.5 stipulates that I consider all relevant factors when determining whether costs should be awarded, including: the seriousness of the misconduct, whether it was a breach of a Tribunal order, whether the behaviour interfered with the Tribunal’s ability to carry out a fair, efficient, and effective process, the prejudice to the other parties, and the potential impact an order for costs would have on individuals accessing the Tribunal. Rule 19.5 also permits me the authority to deny or grant the request for costs or award a different amount.

36I find that Modi acted unreasonably when he failed to file the appropriate responding forms and failed to produce all the documents as Ordered by the Tribunal. The active participation of the parties to a dispute before the tribunal is an important part of the dispute resolution process and includes the submission of forms. Rule 20.2 of the Rules stipulates that a response to an Automobile Accident Benefit Service (“AABS”) claim shall be provided in the form specified by the Tribunal within 14 days of having been served with the AABS claim. Rule 20.4 states that each party shall file an AABS Case Conference Summary at least 10 days before a scheduled case conference. Modi never provided a Response or a case conference summary and does not dispute that he failed to produce all the documents ordered by the Tribunal.

37I find that a cost award of $250.00 is reasonable in the circumstances. Rule 19.6 permits me to award up to $1,000.00 for each full day of attendance at a motion, case conference, or hearing. Modi’s failure to participate in the process warrants censure because it was unreasonable and contrary to the Tribunal order. However, the behaviour did not impact the overall outcome of the proceeding considering that Aviva’s entitlement to repayment is limited only because it failed to notify Modi of an amount more than $8,800.00, and not because Modi failed to produce certain documents. In the end, the overall impact the behaviour had on the Tribunal’s ability to carry out a full and fair hearing of the issues was relatively inconsequential to the process, and the cost award should reflect this while still serving to discourage similar behaviour in the future.

CONCLUSION AND ORDER

38I conclude that Modi failed to disclose his return-to-work status to Aviva and misrepresented his employment status while collecting IRBs. As a result, I find that Aviva is entitled to a repayment of IRBs paid to Modi, however the amount of the repayment is limited to the amount Aviva notified Modi of, being $8,800.00, plus interest pursuant to section 52(5) of the Schedule.

39Modi is ordered to pay Aviva $8,800.00 plus interest pursuant to section 52(5) of the Schedule, effective 15 days from August 30, 2018.