Determining causation is critical in SABS claims and often, new evidence can substantially alter a finding of causation throughout proceedings. However, where or when is it appropriate to argue this? What are the time limits on utilizing fresh evidence to defend a claim on the basis of causation? In a recent preliminary issue hearing at the LAT (AGS vs. Echelon General Insurance Company, 2020 ONLAT 18-001994/AABS), Adjudicator Derek Grant accepts a delayed assessment of causation by the insurer but finds that a standalone application to revisit causation is simply not appropriate.  

The applicant (ASG) was involved in a car accident as a fetus that resulted in her premature birth at 26 weeks gestation. She was diagnosed with cerebral palsy. After paying benefits based on a medical opinion, Echelon later questioned whether the accident caused AGS’ condition and sought to rely on a new medical opinion that concluded that the accident did not cause AGS’ impairments.,

Rather than simply asserting causation as a defence, Echelon commenced its own standalone application for a determination of the causation issue. The Tribunal decided to consolidate that application as part of the subject hearing that determined whether Echelon was permitted to raise causation as a defence. Ultimately, the decision in this preliminary issues hearing found that Echelon was permitted to argue causation at the hearing related to the issues in dispute and as a result Echelon’s pre-emptive application for a determination of causation was pronounced moot.

This decision dealt with revisiting causation in two respects. Firstly, the Tribunal contemplated the lapsing of the two-year limitation period and whether this, along with the initial approval of benefits had barred Echelon from arguing causation. The Tribunal found that the approval and payment of a benefit did not trigger a s.56 limitation period. Adjudicator Grant stated, “Section 56 applies to claims brought against insurers for denials of benefits.  It says nothing about defences insurers may raise against those claims”.

The Applicant also argued that where Echelon had approved prior benefits (in this case attendant care), it could not longer raise a causation defence. On that issue, there was no evidence proffered that Echelon’s actions were an admission or waiver of its right to raise the issue of causation. There was no evidence that Echelon had “full knowledge” and chose not to assert it’s right to deny benefits.  It was noted that “…there is no evidence that Echelon knew, or had reason to believe that AGS’s condition was not the result of the accident and chose to waive any reliance on a lack of a causal connection and make payments of any benefits”.

Secondly, the Tribunal considered Echelon’s entitlement to rely on the fresh medical legal report and its argued contrariness to section 44. The Applicant argued that as the report was commissioned by counsel for Echelon that it was non-compliant with section 44 as I was “not arranged with a person chosen by the insurer but rather at the behest of the insurer’s legal counsel.”

The Tribunal found that based on s.44(1) of the Schedule, Echelon had previously conducted examinations, and had appropriately determined, based on new available medical evidence provided by AGS, that further investigations were both reasonable and necessary and that there was no evidence put forth by AGS that the number of assessments were “more often than necessary”. It was also noted that it was clear that counsel were acting on behalf of, and taking instructions from, the insurer.

Perhaps of equal importance was the circumstances by which this application came before Adjudicator Grant, in that the issue of whether Echelon could rely on a caustion defence was being disputed generally and not with respect to any specific disputed benefits. On that issue, Adjudicator Grant wrote,

[44]        With respect to both counsels, I think they have overly complicated this proceeding by bringing multiple applications, particularly one seeking to permit Echelon to advance a defence.  Causation is simply a defence and not a standalone issue to be brought before the Tribunal.  It may be raised at any point during the proceeding.  Where new evidence becomes available, necessitating an insurer to re-evaluate an insured’s entitlement to benefits; or what contributing factors may need to be considered as to the cause or source of injuries or impairments, this may lead to the defence argument of causation to be raised.

[45]        I find that causation can be argued at the substantive issues hearing in this proceeding.  Echelon is not prohibited by any limitation period from raising this defence argument.  Echelon should not have filed its own application to address the issue of causation, but, given that 19-007602/AABS has been consolidated into Tribunal file 18-001994/AABS, the application is not necessary, and the issue is moot.

This decision confirms that raising the issue of causation will not be subject to  the standard s.56 limitation period. Not to forget, paying benefits does not amount to a waiver of the insurer’s rights to revisit causation and conduct future examinations.

If you have a question about this decision or a similar file, please contact  Peter Durant at 416-777-5234.