Dykeman v. TD General Insurance Company, 2023 CanLII 84364

Dykeman v. TD General Insurance Company, 2023 ONLAT 21-009299/AABS

Citation: Dykeman v. TD General Insurance Company, 2023 ONLAT 21-009299/AABS

Licence Appeal Tribunal File Number: 21-009299/AABS

In the matter of an application per subsection 280(2) of the Insurance Act, RSO 1990, c I.8, in relation to statutory accident benefits.

Between:

Marie Dykeman

Applicant

and

TD General Insurance Company

Respondent

DECISION

PANEL:

Michael Beauchesne & Jeremy A. Roberts

APPEARANCES:

For the Applicant:

Mikolaj Grodzki, Counsel

For the Respondent:

Michael Huclack, Counsel

Court Reporter:

Corey Salazar

Heard by Videoconference:

June 21-22, 2023

OVERVIEW

1Marie Dykeman, the applicant, was involved in an automobile accident on December 29, 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, TD General Insurance Company, and applied to the Licence Appeal Tribunal - Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.

PRELIMINARY ISSUE

2At the start of the hearing, the applicant brought a preliminary motion for a summary judgement entitling the applicant to an income replacement benefit. The applicant argued the respondent is required—under s. 36(4)(b) of the Schedule—to provide written notice as to why the respondent believes the applicant is not entitled to a specified benefit. The applicant explained that failing to comply obligates the respondent to pay the specified benefit under s. 36(6) of the Schedule. The respondent argued that the basis for the applicant’s motion encompasses the same issue before the Tribunal in the substantive issue hearing, and that there was no good reason why two proceedings were needed to adjudicate the same issue.

3We considered the parties’ arguments and denied the applicant’s motion. This is because proceeding on both a preliminary hearing and the substantive issue hearing would have unduly complicated the entire proceeding and unfairly allowed the applicant two attempts to meet her onus of proving entitlement. In our view, the same arguments to be put forward on the motion in a preliminary issue hearing would be delivered as part of the substantive issue hearing. Further, we preferred the substantive issue hearing, so as not to restrict the evidence to only the materials filed with the motion. We therefore dismissed the motion.

ISSUES

4The issues in dispute are:

i. Is the applicant entitled to an income replacement benefit (IRB) in the amount of $400.00 per week from January 28, 2021, to date and ongoing?

ii. Is the respondent liable to pay an award under s. 10 of O. Reg. 664 because it unreasonably withheld or delayed payments to the applicant?

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

PROCEDURAL ISSUES

The applicant seeks to revise the period of the IRB

5While canvassing the parties on the issues, both parties confirmed the period for the IRB is January 28, 2021, to present and ongoing. However, the applicant later indicated a mistake had been made, and that the correct period should have been January 28, 2020, to present and ongoing. The applicant indicated this mistake was a clerical error. The respondent objected to changing the period, arguing that doing so would prejudice the respondent because it was only prepared to argue the merits based on the period indicated in both the Tribunal application and case conference report and order, which indicates January 28, 2021.

6We considered the parties’ arguments and decided in favour of the period starting on January 28, 2021, for several reasons. First, this is the date entered on the application, which is consistent with the case conference report and order. Second, the applicant had multiple opportunities to revise the period during the past 30 months, and the applicant failed to do so, confirming the date as correct on the application, at the case conference, and at the outset of the hearing. Third, changing the date at this late stage of the proceeding would prejudice the respondent by immediately putting an entire year’s worth of medical evidence into play that had not been earlier contemplated by counsel or served with intention to rely upon it at the hearing.

The applicant seeks to proceed exclusively on the pre-104-week eligibility criteria

7A dispute arose as to which eligibility criteria were relevant to the IRB in dispute. The applicant claimed only the pre-104 criteria applied per s. 5(1) of the Schedule because the respondent had not yet denied the pre-104 claim, nor conceded entitlement. The respondent argued the period is calculated from the date of the accident, and that whether the benefit was denied or not is irrelevant to which eligibility criteria apply. The respondent added that both s. 5(1) and s. 6(2)(b) apply because the period is now beyond 104 weeks from the accident. That is to say, the applicant must also prove she meets the post-104 eligibility criteria under s. 6(2)(b) for IRB entitlement on or about December 29, 2021.

8We agree with the respondent that both the pre-and-post 104 eligibility criteria apply here. These periods are both anchored to the date of the accident. We disagree with the applicant’s position because there is no provision in the Schedule or binding case law to vary the eligibility criteria. The accident occurred on December 29, 2019, so the pre-104 eligibility period starts at that time and continues up to December 29, 2021. It follows, that the post-104 eligibility for an IRB would start on December 30, 2021, and continue onwards. Therefore, any claim up to December 29, 2021, would need to meet the “substantial inability” criterion, and any claim from December 30, 2021, onwards would need to meet the “complete inability” criterion.

The applicant seeks to enter new evidence

9Prior to the parties’ opening statements, the applicant requested a new six-part, nearly 2,000-page “medical brief” be admitted as evidence. The applicant argued that additional evidence was now needed to prove eligibility under the post-104 eligibility criteria. The applicant further argued the respondent had been in possession of these documents since March 8, 2023, asserting there was no prejudice to the respondent in admitting the evidence.

10The respondent objected to admitting the medical brief, arguing it was a breach of procedural fairness to allow the applicant to admit a new brief of almost 2,000 pages during a hearing. The respondent explained that the applicant had not served this evidence in accordance with the Tribunal’s Rules, in that it was sent only to the adjuster and not counsel, and further, that March 8, 2023, was well past the production deadline for this case, which was ordered to be 90 days after the case conference that occurred on October 31, 2022.

11We considered the parties’ arguments and decided to admit the applicant’s medical brief. This is because we could not otherwise ascertain if this new evidence was necessary for a full and satisfactory understanding of the issues in the proceeding (i.e., relevance). However, in consideration of the arguments made by the respondent, we also gave both parties leave to make submissions on the weight we should give to this new evidence as part of their closing submissions; neither party did so.

RESULT

12The applicant is entitled to an IRB and interest.

13The applicant is not entitled to an award.

ANALYSIS

Background

14In considering the applicant’s entitlement to the IRB, this case largely turned on procedural issues, rather than medical evidence. Both parties made arguments regarding the proper process to follow upon an insurer’s receipt of an application for IRB.

The respondent failed to meet its obligations under s. 36(4)(b) and (c)

15We find the applicant is entitled to the IRB for the period of January 29, 2020, up to the date of the hearing and ongoing until the insurer gives a notice described in s. 36(4)(b) of the Schedule. This is because the respondent did not satisfy s. 36(4) of the Schedule in any respect, which triggers the consequence as found in s. 36(6) of the Schedule.

16Section 36(4) of the Schedule obligates the insurer to take one of three actions within 10 days of receiving a completed OCF-3 (disability certificate). The insurer must: (a) pay the specified benefit; (b) give the applicant a notice explaining the medical and any other reasons why the insurer does not believe the applicant is entitled to the specified benefit; or (c) send a request for more information to the applicant under subsection 33(1) or (2).

17Failure to comply with s. 36(4) of the Schedule triggers s. 36(6), which states the insurer shall pay the specified benefit for the period starting on the day the insurer received the application and completed disability certificate and ending on the day the insurer gives a notice described in s. 36(4)(b).

18During the hearing, the applicant argued the respondent, upon receipt of the disability certificate and application, did not satisfy any of the three actions within the prescribed time frame. The applicant explained the respondent had produced no evidence of paying the IRB, providing a notice to the applicant to explain why the applicant is not entitled to the IRB, or making a request for further information to the applicant.

19The respondent argued that the applicant’s OCF-1 (application for accident benefits) and disability certificate listed unclear and conflicting information that confused the applicant’s employment history and failed to provide sufficient income information. The respondent, therefore, under s. 36(4)(c) of the Schedule, sought further information—including an OCF-2 (employer’s confirmation form) and reliable income tax information—to properly calculate the amount of IRB owed. The respondent maintained that, despite multiple phone and e-mail requests for this information as evidenced in the adjuster’s log notes, an employer’s confirmation form was never obtained, and that the 2019 income tax return—completed and provided by the applicant in December 2020—was insufficient to properly calculate IRB quantum (i.e., value) because the declaration was unsigned and therefore could not be relied upon as a correct, complete, and full disclosure of income from all sources. The respondent argued that these requests—all made to counsel and not the applicant—satisfied s. 36(4)(c) of the Schedule, which, as stated above, allows the insurer to request additional information by way of s. 33(1) or (2) of the Schedule.

20The respondent agreed it did not make a s. 36(4)(c) request for information to the applicant, but submitted it, nevertheless satisfied this requirement by instead contacting counsel, given that the applicant had a history of homelessness. The applicant disagreed, arguing the respondent was obligated by s. 36(4)(c) to send the request directly to the applicant by way of her last known address.

21We are persuaded by the applicant’s arguments. We find the insurer failed to satisfy the requirements set out in s. 36(4)(a) and (b). In fact, per s. 36(4)(a), neither party produced any evidence of the respondent paying an IRB to the applicant on her claim. When asked directly by the Tribunal if a proper denial notice was ever provided to the applicant under s. 36(4)(b), the respondent unequivocally indicated it had not.

22As it relates to s. 36(4)(c), the wording is specific: the insurer must “send a request to the applicant …”. The term “applicant” is not defined in either the Schedule or the Tribunal’s Common Rules of Practice & Procedure (the “Rules”), so we rely on the case conference report and order for guidance here. The case conference report and order clearly identifies the applicant as the “insured person,” which in this case is Marie Dykeman. The applicant is not defined as her “representative” or “counsel” or otherwise.

23While we accept the respondent’s point that it may have been difficult to reach the applicant given her history of homelessness, we feel s. 36(4)(c) of the Schedule obligates the respondent to at least attempt to request information directly from the applicant. In fact, the applicant provided a complete mailing address on her application for accident benefits, her disability certificate, and her tax return and benefits form, all of which are in evidence. That the respondent made a request for information to counsel is contextually prudent in this case. But it cannot be said that only making that request to counsel satisfies s. 36(4)(c), nor that being prudent in communicating with counsel multiple times about the information requests insulates the respondent from the consequences at s. 36(6) of the Schedule. Indeed, during the hearing, the respondent conceded it had never sent a request for information to the applicant, and produced no evidence to show it had made a request to the applicant for information.

24As such, we find the applicant has proved the respondent failed to meet its requirements under s. 36(4) of the Schedule. The insurer must therefore pay—pursuant to s. 36(6) of the Schedule—the IRB from the period starting on the day the insurer received the application and completed disability certificate (which the parties agree is January 29, 2020) and ending on the day the insurer gives the notice described in s. 36(4)(b) of the Schedule. We note that, as of the hearing, no notice described in s. 36(4)(b) had yet been given.

25Further, we rely on the IRB quantum calculation in the applicant’s accounting report, which indicates $105.13 per week would be owing during the relevant period of January 29, 2020, to December 26, 2021, and then $185.00 per week thereafter. While we agree the respondent showed the tax form was not signed by the applicant, we were persuaded by the accounting report in evidence by ADS Forensic Accountants. On the face of it, this IRB calculation report was completed by certified accounting professionals who accepted the applicant’s tax return as reliable information and provided an extensive analysis to arrive at their calculations. We have no reason to disregard this evidence, given the respondent did not cross-examine the accountants who prepared the report, or obtain its own independent review of the accountants’ findings.

Interest

26Interest applies on the payment of any overdue benefits pursuant to s. 51 of the Schedule. As established at s. 36(6) of the Schedule, payment of the IRB is due on the day the respondent received the application and completed disability certificate, which is January 29, 2020. As such, we find that interest is owed on IRB payments from January 29, 2020, until the notice requirements at s. 36(4)(b) of the Schedule are satisfied.

Award

27The applicant sought an award under s. 10 of O. Reg. 664. Under s. 10, the Tribunal may grant an award of up to 50 per cent of the total benefits payable, plus interest, if it finds that an insurer unreasonably withheld or delayed the payment of benefits.

28The applicant argued that the respondent should pay an award because: (1) it failed to accept the applicant’s documentation despite knowing her unique circumstances (i.e., her reported homelessness and substance abuse); and (2) the unreasonable delay could arguably have caused the applicant’s condition to deteriorate further.

29The respondent argued that the case conference report and order stipulated the applicant was to provide particulars of her award claim 30 days after receipt of the adjuster’s log notes, which she failed to do. The respondent noted the log notes were produced for the applicant on January 23, 2020, and that the award case against it remained unknown up to the closing submissions of the applicant at the hearing.

30While we acknowledge the arguments made by the applicant, the fact remains that the particulars of the award claim were not produced to the respondent by the document disclosure deadline of February 22, 2023, which is 30 days after receipt of the adjuster’s log notes as ordered in the case conference report and order (dated January 5, 2023). In fact, during the hearing, the applicant produced no evidence to show the particulars of the award were disclosed to the respondent prior to closing submissions.

31We decline to provide consent for the applicant to rely on her award submissions per Rule 9.4. In failing to disclose particulars of the award up to the point of closing submissions, the applicant prevented the respondent from knowing the case against it. We therefore believe it would be a breach of procedural fairness to the respondent, to allow the applicant to proceed with the award claim without particulars disclosed in accordance with the order made at the case conference. As such, we dismiss the award claim.

ORDER

32The respondent shall pay an IRB to the applicant in the amount of $105.13 per week from January 29, 2020, to December 26, 2021, and thereafter $185.00 per week up to the date of the hearing and ongoing until proper notice is given pursuant to s. 36(6) of the Schedule.

33The respondent shall pay the applicant interest according to s. 51 of the Schedule on the IRB from January 29, 2020, until the notice requirements at s. 36(4)(b) of the Schedule are satisfied.

34The award claim is dismissed.