LAT Upholds Insurer’s Right to an IE Despite PIPEDA and Charter Challenges
Jul 29, 2020
Applicants who fail to comply with a sec. 44 Insurer Examination (“IE”) obligations are barred from applying to the License Appeal Tribunal by way of appeal of an insurer’s decision to not pay a benefit. This prohibition, contained under sec. 55(1)2 of the Statutory Accident Benefits Schedule, is subject to the Tribunal’s discretion to allow the application to proceed in certain circumstances. Two recent LAT decisions clarify that where the insurer gives proper notice under sec. 44 of the Schedule, the applicant’s failure to comply with the IE request cannot be cured by a variety of technical, breach of privacy or constitutional challenges.
In 18-008289 v. Aviva Insurance Canada, released May 29, 2020, the applicant attended two sec. 44 IEs for a catastrophic impairment determination. Two years later, the applicant found handwritten notes on a prior IE report produced by CanAssess, the third party IE assessor, which was not part of the CAT IEs. She suspected CanAssess had altered the report in favor of the insurer and proceeded to revoke her consent to allow CanAssess to access her personal information. The insurer argued that the applicant’s revocation of consent was equivalent to failing to participate in the IEs.
Adjudicator Norris in a preliminary decision stayed the application pending the applicant’s attendance at a rescheduled IE. He concluded that the insurer provided proper notice of the IEs, as well as disclosing the purpose for which her information would be used and disclosed. He found nothing improper in the draft report, which he identified as a reasonable step in the report production process. The adjudicator held that the applicant’s withdrawal of consent had frustrated production of a final IE report amounting to a failure to participate in the IE process. He refused to hear the applicant’s argument that the IE had violated her Charter rights because the Notice of Constitutional Question was deficient.
In 19-003212 v. Wawanesa Mutual Insurance Company, released June 15, 2020, the applicant failed to attend an IE. He then argued that sec. 55(1)2 of the Schedule did not apply because the insurer’s IE notice was deficient. Specifically, the applicant maintained that the insurer failed to prove it had arranged for an IE at its own expense, as required under sec. 44(5) of the Schedule, and failed to prove that it provided the IE assessor with records as required under sec. 44(9)2.ii. Finally, the applicant pointed to the IE request itself being not reasonably necessary.
Adjudicator Punyarthi dismissed all of these arguments and barred the application under sec. 55(1)2. For the purposes of that section, the adjudicator held that the insurer need only demonstrate that it met the notice requirements for requesting an IE as set out in sec. 44(5). These include the reasons for the IE, whether the applicant’s attendance is required, the name of the assessor and associated regulated health profession, and the day, time and location of the examination.
Adjudicator Punyarthi found the IE request reasonably necessary because the previous IEs were two years old. An Order for a future IE would not yield useful information to determine whether the Minor Injury Guideline applied because too much time would have passed. Adjudicator Punyarthi made it clear that the Tribunal had no statutory power and no jurisdiction to hear the applicant’s submissions on non-compliance with the Personal Information Protection and Electronic Documents Act (“PIPEDA”).
The IE notice requirements are clearly enumerated in sec. 44(5) of the Schedule. Where an applicant fails to comply with a proper IE notice, collateral challenges to the notice will typically fail to prevent the application of sec. 55(1)2. At that point, the central issue the parties should address is what prejudice if any would result from allowing the application to proceed.
Both these decisions give due regard to procedural fairness. They acknowledge that the prospect of proceeding to a substantive hearing without a timely IE report, or one at all, would most certainly prejudice the insurer. Ultimately, this could hinder the Tribunal from fully considering the issues in dispute.
Adjudicator Norris was also mindful of the potential prejudice to the applicant. He found that the applicant was in a potentially vulnerable psychological state. Barring the application would lead to unnecessary procedural delay, causing the applicant to reapply to the Tribunal. Instead, the Tribunal exercised its discretion under sec. 55(2) and stayed the application pending the applicant’s attendance at a rescheduled IE.
Jonathan White is the author of this blog and member of the Licence Appeal Tribunal practice group. If you have a question about these decisions or a contested attendance at an IE, please contact Jonathan at 416-777-5204