Court File and Parties

CITATION: Aviva v. McNamara, 2022 ONSC 1462

DIVISIONAL COURT FILE NO.: DC-21-2652

DATE: 2022-03-08

SUPERIOR COURT OF JUSTICE – ONTARIO

DIVISIONAL COURT

RE: AVIVA CANADA INC., Appellant

AND: PRISCILLA MCNAMARA, Respondent

BEFORE: Swinton, McGee and Nieckarz JJ.

COUNSEL: James M. Brown and Brenden Carruthers for the Appellant Mark Baker for the Respondent

HEARD at Ottawa (by videoconference): February 16, 2022

ENDORSEMENT

Overview

[1] Aviva Canada Inc. (“Aviva”) appeals the August 17, 2020 Order of the License Appeal Tribunal (“Tribunal”) which reinstated nine months of Income Replacement Benefits (“IRBs”) that were suspended because the respondent Ms. McNamara failed to provide her treating physician’s notes and records and because Aviva believed that she had failed to obtain necessary treatment. A request for reconsideration of the August 17, 2020 Order was dismissed by the Tribunal on March 29, 2021.

[2] The only issue on this appeal is Ms. McNamara’s entitlement to benefits, given her failure to provide the requested medical information. Aviva argues that the Tribunal erred in law by misinterpreting the phrase “reasonable explanation” as set out in section 33(8)(b) of the Statutory Accident Benefits Schedule, O. Reg 34/10 (“SABS”) when deciding that Ms. McNamara had provided a reasonable explanation for her delay in providing the notes and records. Alternatively, Aviva submits that the Tribunal did not provide sufficient reasons upon which a reasonable explanation could be found. The Appellant asks that the August 17, 2020 Order be set aside and that a new hearing be ordered before a different Adjudicator.

[3] For the reasons set out below, the appeal is dismissed.

Background Facts

[4] Ms. McNamara was injured in a motor vehicle accident on January 13, 2015. The significance of her injuries qualified her for IRBs and reimbursement of various expenses, including the cost of treatments for post-traumatic stress disorder.

[5] Aviva wrote to Ms. McNamara on September 30, 2016 requesting that she clarify the status of her psychological treatments, and that she provide updated clinical notes and records from her family physician. The letter included a caution that if they did not receive the requested information by October 24, 2016, they would not be liable to pay any further IRBs until the information was provided.

[6] Section 33(1) of the SABS places a duty on an applicant to provide any information reasonably required to assist an insurer in determining the applicant’s entitlement to benefits within 10 business days of request.

[7] Ms. McNamara did not provide the requested documents.

[8] Aviva wrote to Ms. McNamara on November 28, 2016 confirming that they had not yet received the requested information and were therefore suspending her IRBs effective November 21, 2016. Section 33(6) of the SABS provides that an insurer is not liable to pay a benefit in respect to any period during which the insured person fails to comply with the request for information.

[9] On August 17, 2017, Ms. McNamara submitted her treatment plan with a registered psychologist. Aviva reinstated Ms. McNamara’s IRBs from that date forward.

[10] Several significant benefits claimed by Ms. McNamara pursuant to ss. 279 to 283 of the Insurance Act, R.S.O. 1990, c. I.8 continued to be disputed by Aviva. To determine the disputed items, Ms. McNamara submitted an Application by an Injured Person to the License Appeal Tribunal on November 26, 2018. Included in the Application was her request to reinstate the $6,600 of cancelled IRBs accrued from November 21, 2016 to August 17, 2017.

[11] On January 7, 2019 Ms. McNamara served her evidence brief for the May 2019 hearing on the Application. Her brief included some of the notes and records from her family physician that had been requested in the September 20, 2016 letter. On February 15, 2019 and March 6, 2019, she provided the balance of the records. In her affidavit sworn March 14, 2019 she explained why she had not provided the documents sooner: she believed that Aviva could directly access her medical records with the consent that she had earlier provided.

[12] Ms. McNamara’s reasons for not immediately providing the notes and records were important because section 33(8)(b) of the SABS sets out a curative provision for the cancellation of benefits.

33(8) If an applicant who failed to comply with subsection (1) or (2) subsequently complies with that subsection, the insurer,

(a) shall resume payment of the benefit, if a benefit was being paid and

(b) shall pay all amounts that were withheld during the period of non-compliance, if the applicant provides a reasonable explanation for the delay in complying with the subsection

[13] On April 25, 2019 Aviva cross-examined Ms. McNamara on her affidavit. Under oath, she repeated and elaborated on her explanation as to why she had not provided the notes and records to Aviva immediately upon their request. She explained that she did not recall receiving the request, she was grappling with depression, she had difficulties in getting a family physician, had to switch physicians and that she genuinely believed that Aviva already had access to her physician’s notes and records.

[14] There were seven claims set for determination at the May 2019 hearing on the Application. Six of the claims were resolved just before the hearing, leaving only the disputed payment of the $6,600 in IRBs and the issue whether she had failed to obtain necessary treatment. The Adjudicator was tasked with the determination of whether Ms. McNamara had provided a reasonable explanation for the delay in providing the information that had been requested by the insurer.

[15] The Adjudicator released her reasons on August 17, 2020. She agreed with Aviva that their section 33(1) SABS information request letters were valid and unambiguous, that Ms. McNamara was in breach of her obligations under section 33(1) throughout the period in dispute, and that Ms. McNamara’s explanation for her delay in providing the information was reasonable. She ordered Aviva to pay the $6,600 in IRBs.

Issues on Appeal

[16] Aviva appeals the August 17, 2020 decision, stating that the Adjudicator’s finding that Ms. McNamara provided a reasonable explanation for the delay is an error in law because section 33(8) of the SABS requires an objective analysis of what is a reasonable explanation, and thus, the Adjudicator misinterpreted the legal standard to be applied to the facts. In the alternative, Aviva argues that the Adjudicator failed to provide adequate reasons for her decision.

Jurisdiction and Standard of Review

[17] It is agreed that the Divisional Court has jurisdiction to hear this appeal on a question of law only, pursuant to sections 11(1) and (6) of the License Appeal Tribunal Act, 1999, S.O. 1999, c. 12, Sch G. The standard of review on errors of law is correctness: see Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235, at para. 8; Fariad v. Intact Insurance Company, 2021 ONSC 6965 (Div. Ct.), at para 3. There is no right of appeal on fact, or on mixed fact and law without an extricable question of law: Oliver v. Brant Mutual Insurance Company, 2018 ONSC 3716 (Div. Ct.) at para 17.

Analysis

[18] The Adjudicator’s decision released August 17, 2020 sets out the relevant sections of the SABS, the background and undisputed facts and the submissions of the parties. The decision references the extensive medical evidence that the Adjudicator reviewed, and her finding that Ms. McNamara was generally credible, consistent in her statements and answers, and that she testified in an honest and straightforward manner.

[19] The Adjudicator concluded that Ms. McNamara regularly sought and received help for her psychological symptoms during the period of benefits suspension and that she provided a reasonable explanation for not providing her physician’s notes and records when requested.

[20] Aviva submits that the Adjudicator failed to apply any objective view of the reasonableness of Ms. McNamara’s explanation. They argue that section 33(8)(b) of the SABS requires an objective standard of reasonableness, that is, a standard relative to a reasonable person’s actions in the same situation. They point to several tribunal decisions in which the failure to provide timely information was not cured, such as I.Y. v. Pembridge Insurance Co., 2019 83897, Applicant v. State Farm Insurance, Case #17-000018 and I.A. v. TTC Insurance Company Limited, 2019 ONLAT 18-004128/AABS, the latter being a case in which the applicant refused to provide his medical records.

[21] Despite the very able arguments of Mr. Brown, the Court disagrees that the Adjudicator committed an error in law.

[22] In Horvath v. All State Insurance Co. of Canada, 2003 CarswellOnt 5651 the arbitrator collated the following principles which govern the interpretation of the words "reasonable explanation:"

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 of "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 applicant and whether it is equitable to relieve against the consequences of the failure to comply with the time limit.

[23] When applying a curative provision within the SABS, the reasonable explanation test must be applied in context, taking into account the remedial nature of the legislation and the discretion given to the tribunal to excuse an insured’s default. The reasonable explanation test will have a measure of objectivity in that it is worthy of belief, but it need not rise to the standard of the reasonable person in tort law.

[24] The Adjudicator carefully assessed Ms. McNamara’s evidence as a whole, including her answer on cross-examination that she had “signed off” on the status of all her treatments, and her surprise that she was expected to personally give the information to the insurer when at any time, they could have received it directly from the physician.

[25] The Adjudicator found the applicant to be consistent and credible. She accepted Ms. McNamara’s assertions that that she was making best efforts and was compliant with the care and recommendations of her physicians. She had before her the comprehensive medical records showing Ms. McNamara’s struggles with post-traumatic stress. The Adjudicator took all of Ms. McNamara’s personal characteristics into account when finding that her explanation for failing to answer the request for information was reasonable, and in doing so, the Adjudicator did not apply a purely subjective test. She assessed whether the explanation was reasonable in the circumstances of this case.

[26] We find that the Arbitrator applied the correct interpretation of section 33(8)(b) of the SABS and made no extricable error in law. As a result, her findings of fact and mixed fact and law are not open to appellate review.

[27] The insurer’s alternative ground of appeal must also fail. In Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65 at para. 97, the Supreme Court of Canada instructs that “close attention must be paid to a decision maker’s written reasons and that they must be read holistically and contextually, for the very purpose of understanding the basis on which a decision was made.” Determining the adequacy of reasons is a contextual exercise, and here, the decision provides a clearly sufficient basis for meaningful appellate review.

Conclusion

[28] The appeal is dismissed.

[29] The parties agreed in advance of the hearing that the unsuccessful party would pay costs of $7,500. The appellant shall pay costs of $7,500.

Swinton J.

McGee J.

Nieckarz J.

Date: March 8, 2022