EDITORS NOTE: This entry was written, almost entirely, by one of our students, Anisa Arra, and full credit should go to her.
Two recent accident benefits decisions firm up procedural fairness in accident benefits adjudication, with the s. 55 bar to arbitration resulting from failure to attend a properly scheduled examination under section 44.
In Clancy and Aviva, FSCO A15001101 (December 19, 2016), Ms. Clancy was involved in a motor vehicle accident on November 5, 2012. She was subsequently treated for injuries within the MIG. Aviva approved treatment within the $3,500.00 limit. Approximately a year after she was discharged from treatment, she submitted a treatment plan for an in-home assessment. The form stated, without additional information, the applicant had suffered an injury not within the MIG. Aviva denied the proposed treatment plan and requested a s. 44 examination on the basis that it believed that the health practitioner had not provided compelling evidence that the applicant’s impairment were not predominantly a minor injury or that the OCF-18 was reasonable and necessary. The applicant did not attend the IE alleging the insurer’s notice was deficient. A further treatment plan was eventually submitted for physiotherapy treatments outside the MIG. On the same grounds, Aviva advised that it required a s. 44 examination. The applicant protested to this examination as well.
Arbitrator Smith extensively relied on the decision Dela Cruz and TD Home and Auto Insurance Company, FSCO A14-005530 (November 20, 2015), in which Arbitrator Tanaka summarized the s. 55 jurisprudence. The language of s. 55 is mandatory with no exceptions. The purpose of the IE is to help the insurer to fairly adjust a claim and to make a full answer at the hearing. The applicant must provide a reasonable excuse for not attending the IE. In this case, Ms. Clancy failed to do so. Arbitrator Smith found that Aviva’s notice complied with the SABS as it conformed to the framework set out in Augustin and Unifund. At the time of the hearing, four years had lapsed since the accident. Consequently, an IE conducted at that juncture would not allow the insurer to effectively respond to the applicant’s case. As a result, the application for arbitration was dismissed.
In Ismail and State Farm Mutual Automobile Insurance Company, FSCO A13-004326 (December 16, 2016), Mr. Ismail submitted an application for catastrophic determination on the basis of neuropsychological impairment on February 11, 2013. In May and June 2013, he attended a multidisciplinary IE. The applicant obtained responding reports three years later. The reports were forwarded to State Farm approximately 30 days before the commencement of the preliminary issue hearing. The insurer sought to conduct new IEs given the long passage of time between the s. 44 examinations and the applicant’s reports. Prior to delivering his reports, the applicant informed the insurer that he would not attend any further in-person IEs.
At the hearing, the applicant argued that updated IEs were not reasonable as his reports did not contain new diagnoses. The arbitrator did not accept that this factored into the applicant’s decision to refuse to attend the IEs. The applicant articulated his intention to not attend further in-person s. 44 examinations before his reports were completed.
Arbitrator Kowalski found procedural fairness is an overriding consideration in determining whether an IE is reasonable and necessary. Passage of time alone may not warrant additional in-person assessments, but it is a factor that must be weighed against all the evidence before the decision maker. In this case, the applicant purported to restrict the insurer’s right to an IE from his deliberate decision to produce his assessments at the last moment. Accordingly, the arbitrator concluded that the applicant’s prejudice by an adjournment, if any, did not outweigh the prejudice that would result to the insurer if the parties would proceed to arbitration without the IEs. The arbitration was stayed until the applicant attends.
These fresh FSCO decisions give teeth to s. 55 and underscore the procedural fairness aspect of s. 44 examinations. An insured’s unreasonable refusal to attend an IE is prima facie prejudicial to the insurer’s right to respond to the position taken against it. While previously s. 55 had more bark than bite as arbitrators would often find the IE notice insufficient, Augustin seems to have provided insurers with the necessary tools to craft a strong s. 55 position. It remains to be seen whether the LAT will carry on the torch of procedural fairness to light its way in s. 55 motions.