|
Insurance - Auto - Notice (2). Muddapati v. Primmum Insurance Company
In Muddapati v. Primmum Insurance Company (Ont Div Ct, 2026) the Ontario Divisional Court dismissed an appeal, this brought against "a preliminary issue decision of the Licence Appeal Tribunal .... in which the Tribunal found that she was barred from proceeding with her application by the doctrine of res judicata".
The court considers a disputed 'notice' issue, here regarding whether the insurer provided adequate notice "that it was not paying for the benefits claimed because her impairment fell within the MIG" [SABS 34/10 - s.38 'Claim for Medical or Rehabilitation Benefits']:Did the Tribunal err in finding res judicata applied despite the requirements of s. 38(9)?
[11] The appellant submits s. 38(9) of the SABS required the insurer to provide her with specific notice, in the letters sent in response to the treatment plans, that it was not paying for the benefits claimed because her impairment fell within the MIG. She relies on s. 38(11) of the SABS to say that, in the absence of a compliant notice, the respondent could not take the position she was in the MIG and was required to pay for the benefits claimed until it provided a compliant notice.
[12] I disagree with the appellant’s position. There is no question that s. 38(9) requires the insurer to provide the insured with notice of its belief that the person’s impairment falls within the MIG. The insurer’s initial notice obligation in response to a treatment plan is set out in s. 38(8). That provision requires the insurer, within 10 days of receiving a treatment plan, to give notice of which benefits it agrees to pay for, which it does not, and the reasons why it considers the denied benefits not to be reasonable and necessary. Subsection 38(9) then deals with notice that the insurer believes the insured falls within the MIG. It states:38(9) If the insurer believes that the Minor Injury Guideline applies to the insured person’s impairment, the notice under subsection (8) must so advise the insured person. [13] Subsection 38(11) sets out the consequences if the insurer fails to give the notice required by subsection (8). It states:(11) If the insurer fails to give a notice in accordance with subsection (8) in connection with a treatment and assessment plan, the following rules apply:1. The insurer is prohibited from taking the position that the insured person has an impairment to which the Minor Injury Guideline applies.
2. The insurer shall pay for all goods, services, assessments and examinations described in the treatment and assessment plan that relate to the period starting on the 11th business day after the day the insurer received the application and ending on the day the insurer gives a notice described in subsection (8). [14] The appellant relies on subsections (9) and (11) to say the respondent did not give notice that it believed the appellant was within the MIG and, therefore, it was prohibited from taking that position.
[15] The problem with the appellant’s position in the circumstances of this case is there is no dispute that the respondent did give the appellant notice of its view that the appellant’s impairment fell within the MIG, well before the treatment plans in dispute. In addition, it pursued this position when the appellant first applied to the Tribunal. As set out above, the Tribunal agreed that the appellant’s injuries fell within the MIG.
[16] The appellant relies on Zheng v. Aviva Insurance Co. of Canada, 2018 ONSC 5707 to say this initial notice was not sufficient. She argues the insurer was required to give notice about the MIG each time it responded to a treatment plan. But Zheng does not deal with a situation where the insurer previously complied with s. 38(9) and maintained that position before the Tribunal. The appellant has not provided any authority for the proposition that the insurer must provide repeated notices of its position under s. 38(9) when that position has not changed.
[17] The purpose of the MIG, as set out in Zheng, is to establish a treatment framework for an insured who has sustained a minor injury. It permits an insured immediate access to medical treatment without insurer approval and is intended to provide speedy access to rehabilitation for persons with minor injuries: Zheng, at para. 12. Section 38 of the SABS, by contrast, establishes a procedure to apply for benefits other than those payable under the MIG.
[18] In the current case, the appellant had already received benefits to the MIG limit by the time she submitted the treatment plans in dispute. There was no issue with obtaining immediate access to treatment. The insurer therefore obtained a medical report following an insurer examination to determine whether anything had changed that would mean the non-MIG provisions of the SABS would apply. It concluded they did not. The appellant has not persuaded me that s. 38 should be read as requiring an additional notice from the insurer in a situation where the MIG benefits have been exhausted and the insurer has not changed its position that the insured’s injuries fall within the MIG.
[19] I do not see any basis to interfere with the adjudicator’s rejection of the submission that s. 38(9) provided a reason to waive res judicata in this case. . Derenzis v. Gore Mutual Insurance Co.
In Derenzis v. Gore Mutual Insurance Co. (Div Ct, 2025) the Divisional Court dismissed a LAT SABS joint appeal-JR (Yatar), here where an issue was the admission in evidence of allegedly privileged affidavit "information and internal Tribunal documents that the affiant obtained as a Tribunal adjudicator".
Here the court considers the adequacy of insurer notices for required medical examinations (for eligibility) [under SABS s.44 'Examination required by insurer']:[11] Section 44 of the SABS provides in part:Examination required by insurer
44. (1) For the purposes of assisting an insurer to determine if an insured person is or continues to be entitled to a benefit under this Regulation for which an application is made, but not more often than is reasonably necessary, an insurer may require an insured person to be examined under this section by one or more persons chosen by the insurer who are regulated health professionals or who have expertise in vocational rehabilitation.
...
(5) If the insurer requires an examination under this section, the insurer shall arrange for the examination at its expense and shall give the insured person a notice setting out,
(a) the medical and any other reasons for the examination;
(b) whether the attendance of the insured person is required at the examination;
(c) the name of the person or persons who will conduct the examination, any regulated health profession to which they belong and their titles and designations indicating their specialization, if any, in their professions; and
(d) if the attendance of the insured person is required at the examination, the day, time and location of the examination and, if the examination will require more than one day, the same information for the subsequent days. ....
A. Adequacy of IE notices
[54] Ms. Derenzis submits that the Tribunal made errors of law in determining whether Gore Mutual’s IE notices complied with its obligations under s. 44 of the SABS.
[55] Given the “consumer protection purpose” of insurance legislation (and the SABS in particular), Ms. Derenzis argues that notices to the insured under insurance legislation are required to be in “straightforward and clear language, directed towards an unsophisticated person”: see Smith v. Co-operators General Insurance Co., 2002 SCC 30, [2002] 2 S.C.R. 129, at paras. 11, 14. In Smith, at para. 13, the Supreme Court also questioned whether a “verbatim reproduction” of the applicable legislative provisions would constitute sufficient notice to the insured. Consistent with that concern, Ms. Derenzis argues that the contents of Gore Mutual’s IE notices (which in some cases included pages of verbatim SABS provisions before setting out reasons for the IE) ran afoul of the consumer protection purpose of the SABS.
[56] In M.B. v. Aviva Insurance Canada, 2017 CanLII 87160 (Ont. LAT), at para. 26 (referred to in the IRB Decision, at para. 62), the Executive Chair Lamoureux of the Tribunal applied the consumer protection principle in interpreting s. 44(5)(a) of the SABS, which requires that the insurer’s IE notice explain the “medical and other reasons for the examination”:In my view, an insurer satisfies its obligation to provide its “[medical] and any other reasons,” whether under s. 44(5)(a) or elsewhere, by explaining its decision with reference to the insured’s medical condition and any other applicable rationale. That explanation will turn on the unique facts at hand … [but] should, at the very least, include specific details about the insured’s condition forming the basis for the insurer’s decision or, alternatively, identify information about the insured’s condition that the insurer does not have but requires. Additionally, an insurer should also refer to the specific benefit or determination at issue, along with any section of the Schedule upon which it relies. Ultimately, an insurer’s “medical and any other reasons” should be clear and sufficient enough to allow an unsophisticated person to make an informed decision to either accept or dispute the decision at issue. Only then will the explanation serve the Schedule’s consumer protection goal. [Emphasis added.] [57] Ms. Derenzis notes that the M.B. decision has been cited in subsequent Tribunal decisions, including B.M. v Unica Insurance Inc., 2020 CanLII 72512 (ON LAT), in which the Tribunal also stated, at para. 27:An insured person should not be expected to piece together “medical or other reasons” for an examination from disparate notices and correspondence, or ... to advise an insurer of deficiencies in those notices so they may be corrected. The duty to give reasoned notice rests with the insurer. [58] Applying those principles, Ms. Derenzis submits that the Tribunal erred in considering the cumulative effect of various IE notices when determining whether they were sufficient to meet the requirements of s. 44 of the SABS.
[59] Ms. Derenzis says that the Tribunal’s repeated determinations in the IRB Decision that s. 44 notices were valid when considered along with prior notices constituted an extricable error of law, subject to appeal on a correctness standard. She also argues that when considering the validity of IE notices provided in September 2018 shortly before Gore Mutual suspended IRB payments, the Tribunal was wrong in law to consider the reasons provided in an IE notice provided a year and seven months earlier on March 13, 2017 in deciding that the later notices met the requirements of s. 44. Ms. Derenzis says that doing so was an afront to the consumer protection purpose of the SABS and a direct breach of the language and object of s. 44(5)(b). She also submits that the Tribunal’s error in the IRB Decision cannot be saved by its attempts on reconsideration to recharacterize the Tribunal’s findings by stating that the adjudicator considered the adequacy of each notice individually and found each to be compliant: see IRB Reconsideration Decision, at paras 36, 39.
[60] We do not agree that Ms. Derenzis has established an error of law relating to the application of s. 44 of the SABS in this case.
[61] Consistent with Gore Mutual’s submissions, the question of whether the IE notices it provided meet the requirements of s. 44 of the SABS is a question of mixed fact and law, involving the application of s. 44 to the facts. We see no extricable legal error in the Tribunal’s analysis.
[62] When the Tribunal is determining whether an IE notice complied with s. 44, we agree with Gore Mutual that the Tribunal would be precluded from taking into account the information that the insured and their counsel had previously received from the insurer in connection with previous IE notices. As the Tribunal stated in M.B., at para. 26, the insurer’s explanation of the medical and other reasons for the examination turns on the “unique facts at hand” in each case. In 17-004358 v Economical Mutual Insurance Company, 2018 CanLII 112110 (ON LAT), at paras. 13-14, the Tribunal referred to the M.B. decision, including its reference to the “consumer protection goal” of the SABS. In Economical, at paras. 16-17, the Tribunal considered three of the insurers’ examination notices that the insured party challenged as insufficient. The Tribunal found that “sufficient notice was provided for all of the benefits in question”: Economical, at para. 15. In doing so, the Tribunal took into account related reports and forms that had been exchanged between the parties. From these documents, taken together, the Tribunal concluded that the insured had sufficient information to make an informed decision about attending the examinations.
[63] Similarly, in the IRB Decision, in determining that Gore Mutual’s IE notices met the requirements of s. 44, the Tribunal did not err in considering the course of conduct between the parties, including previous IE notices and other documents and information that Ms. Derenzis and her counsel received from Gore Mutual. We are not satisfied that Ms. Derenzis has established any basis for interfering with the Tribunal’s finding that the IE notices complied with s. 44. In any case, the Tribunal found on reconsideration that the adjudicator at first instance considered that adequacy of each IE notice and found each compliant. It was open to the Tribunal to reach that conclusion on the record before it. We see no basis to interfere. . Traders General Insurance Company v. Rumball
In Traders General Insurance Company v. Rumball (Ont Divisional Ct, 2025) the Divisional Court dismissed an insurer's JR, here from an adjudicator's decision that the respondent "is not barred from appealing Traders’ denial of her claim for income replacement benefits (“IRBs”) by the two year limitation period under section 56 of the Statutory Accident Benefits Schedule – Effective September 1, 2010, O. Reg. 34/10, as amended (“SABS”) because Traders’ letter dated March 4, 2015 was not a clear and unequivocal denial of IRBs.":[36] An insurer must provide “clear and unequivocal” notice denying or cancelling the insured’s benefits to trigger the two-year limitation period: Sietzema v. Economical Mutual Insurance Company, 2014 ONCA 111, 118 O.R. (3d) 713, at para. 13, leave to appeal refused, 2014 CanLII 68702 (SCC). Given the consumer protection purpose of the Insurance Act and the SABS, such notice must be in “…straightforward and clear language, directed towards an unsophisticated person”: Smith v. Co-operators General Insurance Co., 2002 SCC 30, [2002] 2 S.C.R. 129, at para. 14. The case involves a close-read and close-reasoning of this particular insurer's extensive notice letter text [paras 4-7, 37-39], which may be useful to anyone facing a similar issues.
|
