Emmanuel Asoanya v. Allstate Insurance Company of Canada, 2024 CanLII 102106

Citation: Asoanya v. Allstate Insurance Company of Canada, 2024 ONLAT 22-009501/AABS

Licence Appeal Tribunal File Number: 22-009501/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:

Emmanuel Asoanya

Applicant

and

Allstate Insurance Company of Canada

Respondent

DECISION

ADJUDICATOR: Ulana Pahuta

APPEARANCES:

For the Applicant: Kalim Khan, Counsel

For the Respondent: Jason Huang, Counsel

HEARD: By way of written submissions

OVERVIEW

1Emmanuel Asoanya, the applicant, was involved in an automobile accident on October 26, 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, Allstate Insurance Company of Canada, and applied to the Licence Appeal Tribunal - Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.

ISSUES

2The issues in dispute are:

i. Is the applicant entitled to $1,881.25 for physiotherapy services, proposed by Seksek Chiropractic PC in a treatment plan dated February 17, 2022?

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

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

3In his submissions for this written hearing, the applicant confirmed that issues 2-4 listed in the Case Conference Report and Order dated May 5, 2023 (“CCRO”) were withdrawn.

RESULT

4I find that the applicant is not entitled to the treatment plan in dispute, interest or an award.

PRELIMINARY ISSUE

5In its written hearing submissions, the respondent requests that the application be dismissed, and raises the preliminary issue of whether the applicant was in an “accident” as defined in s. 3 of the Schedule. It further submits that the applicant wilfully made a material misrepresentation with respect to his application for accident benefits. The respondent argues that the October 26, 2019 incident was staged and therefore was not an “accident”.

6In his reply submissions the applicant argues that the respondent improperly raised these preliminary issues. The accident occurred in October 2019 and the respondent failed to raise these issues until four years later. The applicant further argues that the respondent has not provided any substantive detail or evidentiary basis for these serious allegations. He requests that paragraphs 4-5 of the respondent’s submissions containing these allegations be struck, or that the respondent’s response be struck in its entirety.

7I agree with the applicant that the respondent has improperly introduced preliminary issues without any specific submissions or evidentiary basis. As such, the preliminary issues of whether the applicant was involved in an “accident” or wilfully made a material misrepresentation with respect to his application for accident benefits will not be considered in this written hearing.

8The claims raised by the respondent in paragraphs 4 and 5 of its submissions are preliminary issues which should have been raised as issues in dispute at the case conference. The respondent did not identify these as issues at the case conference, nor did it request to add these issues to this hearing by way of a subsequent motion until after the applicant had already provided his written hearing submissions. The respondent filed a Notice of Motion on February 12, 2024, raising the preliminary issues and requesting that this written hearing be dismissed. On the same day it filed its responding submissions for this hearing.

9The respondent’s motion was denied by way of Motion Order dated February 20, 2024. The Tribunal found that the respondent had failed to raise the preliminary issues in a timely manner and that the applicant is entitled of notice of the case to meet as a matter of procedural fairness, however, the respondent was not precluded from raising these issues at the present hearing. I agree with the reasoning in the Motion Order and similarly find that the applicant is entitled to prepare for this written hearing based on the issues outlined in the CCRO. He had already provided his initial hearing submissions when the respondent subsequently raised the preliminary issues. No explanation was provided by the respondent in its hearing submissions as to why these preliminary issues could not have been identified previously. As such, I find that including these preliminary issues at this written hearing would result in significant prejudice to the applicant and would result in a breach of procedural fairness.

10Moreover, although the respondent has identified preliminary issues in its hearing submissions, no specific submissions or evidence were tendered in support of its claim. The respondent makes reference to the denied motion, but it does not refer me to any evidence that may have been previously tendered in support of the motion. Without any specific submissions or evidence on these issues, I would be unable to make a determination on the merits of the claim.

11As such, the respondent’s submissions on the preliminary issues of whether the applicant was in an “accident” or wilfully made a material misrepresentation, will not be considered in this written hearing.

ANALYSIS

12Sections 14 and 15 of the Schedule set out that an insurer shall pay for all reasonable and necessary expenses incurred by or on behalf of an insured person as a result of an accident. The applicant has the onus of proving on a balance of probabilities that the treatment plans are reasonable and necessary because of the accident.

13The applicant confirmed in his submissions that he would not be addressing whether the treatment plan in dispute was reasonable and necessary. Rather, his arguments solely centre on the procedural requirements of s. 38(8) and s. 44(5) of the Schedule. The applicant submits that all of the respondent’s denial and insurer’s examination notices were non-compliant with the notice requirements in s. 38(8) and 44(5) of the Schedule. As a result, the applicant argues that the treatment plan is payable pursuant to s. 38(11) of the Schedule.

The OCF-18 dated February 17, 2022 is not payable pursuant to s. 38(11) of the Schedule

14The applicant submitted an OCF-18 on February 17, 2022 in the amount of $1,881.25 for physiotherapy services. The respondent replied by way of an Explanation of Benefits (“EOB”) dated March 4, 2022 which denied the treatment plan and stated that it would be requiring a second opinion. The respondent subsequently sent a Notice of Examination (“NOE”) on March 10, 2022 requesting the applicant’s attendance at a physiatry insurer’s examination. The applicant submits that both the EOB and NOE failed to provide sufficient medical reasons for the denial. He further submits that the EOB was provided outside of the 10-business day timeline stipulated in s. 38(8) of the Schedule.

15While I agree with the applicant that the March 4, 2022 EOB was provided outside of the 10-business day timeline in s. 38(8) of the Schedule, I find that the notice did provide sufficient medical “and all of the other reasons” why the treatment plan was not being approved.

“medical and all of the other reasons” for the denial

16The EOB stated that the respondent had reviewed the OCF-18 and the applicant’s medical file and determined that the OCF-18 was not reasonable and necessary. The respondent further stated that based on its review of the applicant’s file, it was indicated that the applicant had sustained physical impairments as a result of a previous motor vehicle accident in July 2019. As a result, the respondent required a second medical opinion to determine whether the proposed goods and services were reasonable and necessary as a direct result of the October 26, 2019 motor vehicle accident. The EOB noted that a s. 44 IE request would follow. The March 10, 2022 NOE provided the same reasons for the proposed IE.

17I find that the stated reason for the denial was compliant with s. 38(8) of the Schedule. The “medical and all of the other reasons” was clearly identified. Namely, that the applicant’s medical file had revealed that the applicant had sustained physical injuries in a prior motor vehicle accident, and that respondent wanted to obtain its own medical opinion as to whether the proposed physiotherapy treatment was needed as a direct result of the subject accident. I do not agree with the applicant that the EOB provided a limited non-specific explanation. In my view a clear and specific medical reason was provided.

18The applicant further argues the applicant’s chiropractor who submitted the OCF-18 expressly acknowledged the 2019 injuries and had already identified them as having the potential to affect the applicant’s response to treatment. Therefore, the applicant argues that the “second medical opinion” requested in the EOB was not justified. The applicant submits that the OCF-18 was “certified” as reasonable and necessary by the applicant’s treatment provider, which created a rebuttable presumption of entitlement. As such, he argues that the respondent could only justify its request for an IE if it could demonstrate that the “first opinion”, provided in the OCF-18, was unreliable. I am not persuaded by the applicant’s argument. The respondent was seeking its own medical opinion to consider whether the impairments necessitating treatment were directly caused by the accident. The applicant does not direct me to any provision of the Schedule or caselaw that holds that an insurer must accept the initial opinion provided in an OCF-18.

19Although I have found that the respondent’s EOB was compliant with s. 38(8) in that it provided “medical and all of the other reasons” for the denial, I agree with the applicant that the EOB was provided outside of the 10-business day time limit also required by s. 38(8). The respondent concedes that the EOB was sent one business day late. However, it argues that the OCF-18 is still not payable pursuant to s. 38(11) of the Schedule as it was not incurred within the one business day period of non-compliance.

The OCF-18 was not incurred during the period of s. 38(8) non-compliance

20I agree with the respondent and find that the OCF-18 is not payable as the proposed services were not incurred during the one-business day period of non-compliance. In Aviva General Insurance Company v. Catic, 2022 ONSC 6000, the Divisional Court held at paragraph 18 that s. 38(11)2 of the Schedule operates so as to compel the insurer who fails to provide statutory notice under s. 38(8) to pay for all of the items listed in the treatment plan, but only if they are incurred and only for the period during which any denial notice remains outstanding. This decision is binding upon me.

21I further am not persuaded by the applicant’s argument that the respondent’s failure to comply with the 10 business day limit is incapable of being “cured” by s. 38(11)2. He submits that a late notice will always be lacking one of the required features of a compliant notice under s. 38(8), namely, that it was not provided within 10 business days. I do not agree with the applicant’s interpretation of s. 38(11)2.

22Section 38(11)2 specifies that, if the notice requirements in s. 38(8) are breached, the insurer shall pay for the goods and services described in the treatment plan “that relate to the period starting on the 11th business day after the day the insurer received the application and ending on the day the insurer gives a notice described in subsection (8)”. I interpret this to mean that an insurer is able to cure the deficient notice, but must pay for goods and services that relate to the period in between the deficient and cured notice. It cannot be said that if an insurer sends a denial letter late, all goods and services in the denied treatment plan are forever payable. This would effectively render s. 38(11)2 meaningless.

23The applicant further argues that the ruling in Catic is irreconcilable with earlier decisions of the Court, such as Zheng, Cai v. Aviva Insurance Company of Canada, 2018 ONSC 5707 and does not fit with the broader framework and consumer protection mandate of the Schedule. I do not agree with the applicant’s interpretation of Zheng. While I agree with the applicant that at para 20 the Court states that provisions of s. 38 are strict and the consequences of s. 38(11) are mandatory, the Court in Zheng also states at para 19 that once s. 38(11) is engaged, the insurer “must pay for costs under the Treatment Plan in question until a compliant notice is given”. In my view, Catic and Zheng are not incompatible.

24As such, I find that the OCF-18 is not payable pursuant to s. 38(11).

Interest

25Interest applies on the payment of any overdue benefits pursuant to s. 51 of the Schedule. As no benefits are overdue, the applicant is not entitled to interest.

Award

26The applicant sought an award under s. 10 of Regulation 664. Under s. 10, the Tribunal may grant an award of up to 50 per cent of the total benefits payable if it finds that an insurer unreasonably withheld or delayed the payment of benefits. I find that the applicant has not established that any benefits were delayed or unreasonably withheld. As such, the respondent is not liable to pay an award.

ORDER

27For the foregoing reasons I find that:

i. the applicant is not entitled to the treatment plan in dispute, or interest;

ii. the respondent is not liable to pay an award; and

iii. the application is dismissed.