Citation: Driscoll v. Allstate Insurance Company of Canada, 2025 ONLAT 24-001272/AABS

Licence Appeal Tribunal File Number: 24-001272/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:

Kayla Driscoll

Applicant

and

Allstate Insurance Company of Canada

Respondent

DECISION

ADJUDICATOR:

Dagmara Szczudlo

APPEARANCES:

For the Applicant:

Maciek Piekosz, Counsel

For the Respondent:

Colleen Mackeigan, Counsel

Court Reporter:

Marcia Gardner, Victory Verbatim

HEARD by Videoconference:

January 27, 2025

OVERVIEW

1Kayla Driscoll, the applicant, was involved in an automobile accident on July 31, 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, 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 sole issue in dispute is:

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

3At the hearing, the parties agreed that the post-104 income replacement benefit (“IRB”) was re-instated as per the explanation of benefits dated January 22, 2025 and that this issue was resolved. The respondent also agreed to pay interest for overdue payment of IRB benefits on this date.

4As per the Case Conference Report and Order released June 21, 2024 (“CCRO”), the sole remaining issue is whether the respondent is liable to pay an award under s. 10 of Reg. 664.

RESULT

5The respondent is liable to pay an award of 25 per cent because it unreasonably withheld and delayed payments to the applicant. The award applies to the total IRB payable to the applicant between March 8, 2023 and January 22, 2025.

PROCEDURAL ISSUE

Summoned witness did not attend hearing

6On December 17, 2024, the applicant filed Summons to a Witness forms for several witnesses, including Mr. Carlin D’Souza, Senior Claims Advisor at Allstate Insurance. The summons were approved by Adjudicator Lisa Yong on December 18, 2024 and issued by the Tribunal on December 19, 2024.

7Mr. D’Souza did not attend the hearing on January 27, 2025 despite being summoned. The applicant submitted that the Tribunal should draw a negative inference regarding the respondent’s conduct from the failure of the summoned Claims Advisor to testify at the hearing.

8The respondent submitted that Mr. D’Souza was the file adjuster for a brief period of time and is no longer employed by the respondent. The respondent also submitted that the applicant had the option of summoning Ms. Olivia Nogard, who was also an adjuster on this file, but did not do so.

9I find that Mr. D’Souza sent a letter dated June 1, 2023 advising the applicant that he was assigned to her file and to direct any future questions or correspondence to his attention. Mr. D’Souza’s name also appears in the adjuster’s log notes starting on October 4, 2023.

10However, in reviewing the summons for Mr. D’Souza, I note that the address listed for this witness was the address of the respondent. Mr. D’Souza’s last date of employment with Allstate Insurance is not part of the evidentiary record, but I decline to draw an adverse inference from Mr. D’Souza’s failure to attend the hearing as I am not able to establish that he received the summons issued by the Tribunal.

ANALYSIS

11For the following reasons, I find that the respondent is liable to pay an award of 25 per cent because the respondent unreasonably withheld and delayed payments to the applicant.

12As per the binding Divisional Court decision in Vivekanantham v. Certas Direct Insurance Company, 2024 ONSC 6198, it is an error of law to refuse to order payment of an award simply because the insurer has settled the insured person’s claims and the benefits are no longer in dispute at the time of the decision. Vivekanantham confirms the Tribunal’s authority to order an award in situations where the benefit has been paid before or during a hearing. The specific reasons why the current case attracts an award are outlined below.

13The applicant sought an award of 40 per cent under section 10 of Regulation 664. Under section 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.

14The applicant bears the onus of establishing, on a balance of probabilities that the respondent acted unreasonably in withholding or delaying the payment of a disputed benefit.

The respondent withheld and delayed post-104 IRB payments

15The applicant submits that the respondent’s conduct demonstrates it unreasonably withheld and delayed payment of IRB and agreed to pay the benefit 5 days before the hearing. He submits that the respondent did not consider additional medical evidence outlined in s. 25 reports and subsequent rebuttal reports and did not meet its obligation to adjust the file as new information became available. Finally, the applicant highlights that the explanation of benefits which re-instated the IRB did not provide a reason for the reversal of the original denial.

16The respondent counters that its actions were reasonable and within the prescribed limits of the Schedule. The decision to re-instate the IRB was not an attempt to rectify an error, but a consideration of new information from a Canada Pension Plan Disability (“CPP-D”) decision summary and CPP-Ds reliance on the s. 25 assessor’s reports.

17The respondent suspended payment of IRB on March 8, 2023, based on a s. 44 insurer’s examination report dated March 3, 2023. The s. 44 report was prepared by Dr. G. Gelman, Family Physician, Dr. J. Lazarou, Neurologist, Dr. J. Out, Psychologist, Dr. V. Rajgopal, Orthopaedic Surgeon, and Mr. F. De Menech, Certified Vocational Evaluator. The report concluded that the applicant did not suffer a complete inability to engage in any employment for which she is reasonably suited for by education, training or experience.

18An explanation of benefits dated January 22, 2025, notified the applicant that the IRB was re-instated and would be paid retrospectively, including interest, from March 8, 2023. This decision was reached by the respondent 686 days after the initial denial and 5 days before the hearing in this dispute was scheduled to proceed. It was made without explanation.

The respondent did not adjust the file as new information became available

19Considering that the s. 25 assessment reports were prepared in 2023, I find that the respondent did not adjust the file as new information became available and this conduct lead to a significant delay in the payment of IRB.

20Section 25 assessments and rebuttal replies to the IRB s. 44 reports were conducted as follows:

Table 1: Summary of s. 25 assessments and rebuttal replies for IRB

Date of Report

Title of Document

Prepared By

March 3, 2023

Occupational Therapy

Functional Ability Evaluation

Catherine Sydor, OT

March 6, 2023

Speech Language Pathology Med-Legal Cognitive Communication Assessment

Bianca Heaslip, Speech Language Pathologist

March 6, 2023

Vocational Evaluation

Allan Mills, Vocational Evaluator

June 26, 2023

Physiatry report

Dr. S. Macaluso, Physical Medicine and Rehabilitation

September 13, 2023

Vocational Rebuttal Letter

(re: IRB s. 44 assessments)

Allan Mills, Vocational Evaluator

September 14, 2023

Catastrophic Impairment Assessment / Occupational Therapy In-Home & Situational Assessment Reports

Cheryl Fountain-Gore, OT

September 14, 2023

Catastrophic Assessment – Mental Health/Medical

And Consolidated Opinion

Dr. Nadia Brown, Family Medicine

September 23, 2023

Speech Language Pathology Rebuttal Letter

Bianca Heaslip, Speech Language Pathologist

November 7, 2023

Occupational Therapist Rebuttal Letter

Catherine Sydor, OT

21The dates when s. 25 reports and rebuttal letters were shared with the respondent are not part of the evidentiary record. However, the documents set out above were present in the respondent’s hearing brief, which leads me to conclude that the respondent was in possession of this information, although the exact dates when it was received are unclear. The last s. 25 rebuttal report was dated November 7, 2023. I find it more likely than not that the respondent had access to the s. 25 reports within a few weeks of the last report date and in any event, in advance of when it reinstated benefits.

22A review of the adjuster’s log notes provided from July 31, 2020 to February 1, 2024 does not reveal references to any s. 25 assessments or rebuttals received from the applicant and the dates when the documents were sent to the respondent are not part of the evidentiary record. Adjuster’s log notes in the early days of the claim included numerous examples of email correspondence between the applicant’s legal representative, the applicant, and the adjuster Olivia Nogard. This practice changes after the last entry made by Olivia Nogard on April 27, 2023, when other adjusters, including Mr. Carlin D’Souza appear on the file. Given that the applicant’s legal counsel obtained the s. 25 reports which supported his position, I find it more likely than not that he would have provided them to the respondent shortly after the reports were prepared, however, the applicant did not provide evidence when s. 25 reports were provided. As a result, I am not able to reconcile whether those dates correspond with the interval for which adjuster’s log notes were provided.

23It appears that both s. 44 and s. 25 reports were released at approximately the same time in March 2023. A review of the documentation provided to s. 44 assessors was conducted and s. 25 assessments listed in Table 1 above did not appear in the IRB s. 44 report dated March 3, 2023. This leads me to conclude that s. 44 assessors did not have access to the opinions and conclusions of s. 25 assessors when they prepared their report. Section 44 addendum reports were not part of the evidentiary record, and I conclude that the respondent did not arrange subsequent paper s. 44 reviews once concerns were identified in the applicant’s rebuttal reports.

24As per the CCRO, the applicant was ordered to provide the CPP-D file from the date of loss up to the date of the case conference within 45 calendar days of June 17, 2024. The applicant was already approved to receive CPP-D benefits at the time of case conference as the decision to approve the applicant’s CPP-D disability benefits was issued by Service Canada on March 24, 2024. The detailed CPP-D decision summary was not included in initial document exchange and was shared with the respondent in an update sent January 8, 2025. Although both parties agree that the respondent received the CPP-D decision summary on January 8, 2025, I find that this decision summary was not an essential component to determine whether the applicant is eligible to receive IRB nor a legitimate reason why IRB benefits would suddenly be re-instated.

25In my view, withholding benefits until another adjudicative body issues a decision regarding a separate benefit with its own entitlement criteria is behaviour that attracts an award. I am not persuaded that the reasons for approval of CPP-D benefits, specifically CPP-D’s reliance on conclusions reached by s. 25 assessors were new information for the respondent in January 2025 because I find it more likely than not, that the respondent received s. 25 assessment reports before January 2025.

26I find that the applicant is entitled to an award in this matter because the respondent’s conduct was inflexible and unyielding and there was a significant and unexplained delay in reinstating the applicant’s IRB shortly the hearing.

Award Quantum

27The applicant relied on case law to support entitlement to an award and provided several case references, including 17-006757 v Aviva Insurance Canada, 2018 CanLII 81949 (ON LAT) which outlined the following factors in determining the proportionality of an award:

i. the blameworthiness of the insurer's conduct;

ii. the vulnerability of the insured person;

iii. the harm or potential harm directed at the insured person;

iv. the need for deterrence;

v. the advantage wrongfully gained by the insurer from the misconduct;

vi. take into account any other penalties or sanctions that have been or likely will be imposed on the insurer due to its misconduct; and

vii. overall length of the delay.

28I accept that the above factors provide helpful guidance in establishing the quantum of an award. Of specific relevance to this case are the applicant’s vulnerability, the harm or potential harm directed at the applicant, the need for deterrence, and the overall length of the delay.

29After considering these factors, particularly the overall length of the delay in this case (686 days), I find that the appropriate quantum of the award is 25 per cent. A 50 per cent award is reserved for the most egregious conduct of the part of the insurer and is not warranted in this case since the respondent re-instated IRB and the hearing length was significantly reduced.

30Prior to being struck by a car as a pedestrian, the applicant was a single woman who lived alone in a rented apartment, utilized public transit, and earned a modest income. She was vulnerable financially to any disruptions to her income and delayed payments increased her vulnerability.

31I am not able to assess the blameworthiness of the respondent's conduct, the advantage gained from the delayed resumption of IRB, nor take into account any other penalties that were or may be imposed. In these circumstances, I find that a 25 per cent award is a reasonable deterrent to discourage similar conduct in the future.

ORDER

32For the above reasons, I find:

i. The respondent is liable to pay an award of 25 per cent of total IRB payable to the applicant between March 8, 2023 and January 22, 2025 because it unreasonably withheld and delayed payments to the applicant.