December 07, 2017, Kitchener, Ontario
Posted by: Robert Deutschmann, Personal Injury Lawyer
FF v. Aviva Canada, 2017 LAT 16-000941 CanLII 77381 (ON LAT)
Decision Date: November 10, 2017
Heard Before: Linda P. Lamoureux, Executive Chair
RECONSIDERATION OF IRB DECISION: IRB entitlement and quantum reviewed after Tribunal makes error in decision.
This is a request for reconsideration of a previous decision. The Tribunal must consider whether FF is entitled to an IRB pursuant to the SABs. Aviva accepts the Tribunal’s decision that he suffers from a substantial inability to perform the essential tasks of his pre-accident employment and he is eligible to receive the IRB.
Aviva raises a different challenge to the Tribunal’s decision that FF should receive the IRB for the claim period at issue: according to Aviva, the Tribunal erred in finding that FF had a reasonable explanation for breaching s. 33(1) of the Schedule by not providing Aviva with information it reasonably required to calculate the IRB. Aviva argues that, once this error is corrected, the consequence outlined in s. 33(6) applies, namely that it is not liable to pay the IRB for any period during FF’s failure to provide the information it requested.
The Adjudicator agreed and granted Aviva’s request in part and vary the Tribunal’s decision of March 22, 2017 to provide that FF is entitled to an IRB from only June 10, 2014 to May 26, 2015.
FF was injured in a car accident on June 3, 2014. At the time, he was a 72-year-old former airline mechanic who, although retired, continued to operate a long-standing business importing African textiles to Canada. After the accident, health practitioners completed multiple Disability Certificates (OCF-3) on FF’s behalf, indicating that his injuries included WAD2, lower back pain, and sprain and strain of his shoulder joint. These injuries impaired FF’s ability to, among other things, operate his business.
FF applied to Aviva under the Schedule for various benefits, including an IRB. FF sent Aviva an Application for Accident Benefits (OCF-1) dated July 23, 2014, along with an OCF-3 completed by his family physician.
Aviva noted a discrepancy. The OCF-1 indicated that FF was self-employed and that the accident prevented him from working, while the OCF-3 indicated that he did not suffer from a substantial inability to perform the essential tasks of his pre-accident employment. Aviva therefore asked him to complete an Election of Benefits form (OCF-10) to help it determine FF’s entitlement to a specific benefit. FF eventually submitted n OCF-10 months later, on February 13, 2015, electing to receive an IRB.
In the interim, Aviva did two things. First, it asked FF to attend three IEs to determine whether he was eligible to receive an IRB. Based on these reports, it would “continue entitlement to income replacement benefit at [that] time” but would reassess his condition by June 2015.
Second, Aviva engaged a professional accounting firm to help calculate the IRB. BDO wrote to FF’s counsel on both October 29 and December 1, 2014 requesting financial informationincluding his 2013 personal tax returns. In both letters, BDO explained that it had been retained by Aviva to calculate FF’s IRB, asked for information that it identified specifically, and requested a response within 15 days. BDO received no response. Aviva asked again for the information and asked for a response within 10 days. It received no response. For that reason, Aviva wrote again to FF’s counsel on February 27, 2015 to reiterate its request and explain that, given the lack of response, it would not pay for an IRB for any time before February 27, 2015.
Over the next couple of months, Aviva reassessed FF’s condition. To that end, it again asked FF to attend additional insurer examinations, and based on the results, Aviva informed FF of its position that he did not suffer a substantial inability to perform the essential tasks of his pre-accident employment and, thus, that “[his] Income Replacement Benefits will not be paid beyond the date of May 26, 2015.” Aviva’s letter also mentioned the outstanding financial information: “Please be advised that once we have the income information the official stoppage of the IRB will be effective May 26, 2015, and no benefits will be paid beyond that date.” In this sense, this latest correspondence suggested that Aviva would pay FF for an IRB up to May 26, 2015, provided he forwarded his financial information, but that it would not pay the IRB for any period thereafter.
On June 24, 2016, FF began this application to dispute, among other things, his entitlement to an IRB. FF gave Aviva copies of his 2013 and 2014 personal income tax returns, and additional records concerning his income. On November 15, 2016, this application was heard by way of a written hearing based solely on the parties’ written submissions and supporting documentation. The parties agreed that at issue was whether FF was entitled to a weekly IRB in the amount of $132.90 from June 10, 2014 to June 3, 2016. Notably, this amount – i.e., $132.90 – is based on the income that FF reported in his 2013 personal tax return. In his written submissions filed before the hearing, FF maintained that he was eligible for the IRB, and that “several documents” that BDO requested were not relevant to his claim. In his view, all necessary and relevant information had been provided to Aviva.
Aviva disputed FF’s eligibility for the IRB, pointing to multiple requests and FF’s failure to provide Aviva with all requested financial information. Aviva argued, s. 33(6) applied: it was not liable to pay the IRB for any period during FF’s failure to provide all of the requested information. Aviva also argued that, although it provided all of FF’s available financial information to BDO, BDO was still unable to calculate the IRB and had requested further information from FF, which FF had failed to provide. Thus, Aviva argued, it was “not in a position to quantify” the IRB.
In reply, FF made a number of arguments addressing Aviva’s reliance on s. 33(6). The most significant of these underscored s. 33(8)(b). That section provides that, where an applicant fails to comply with s. 33(1) but subsequently does comply and provides a “reasonable explanation” for the delay in complying, an insurer shall pay all amounts that were withheld as a result of the previous non-compliance. FF proffered an explanation for his delay in answering BDO and Aviva’s requests for his financial information: “he required additional time to obtain information as he was involved in a serious motor vehicle collision, suffered serious injuries, is elderly, and was unexpectedly required to provide extensive documentation about his business.”
The Tribunal made two key determinations. First, it held that there was no dispute that FF was entitled to the IRB from June 10, 2014 to May 26, 2015. Second, the Tribunal held that, while FF failed to comply with s. 33(1) of the Schedule, he had a reasonable explanation for doing so. Based on these findings, the Tribunal went on to adopt FF’s calculation of his IRB based on his 2013 personal income tax return, holding that FF should receive a weekly IRB of $132.90 from June 10, 2014 to June 3, 2016.
Why the Tribunal erred in considering FF’s “reasonable explanation”
Aviva makes this request for reconsideration on two main grounds. First, it argues that the Tribunal made a significant error in fact concerning FF’s breach of s. 33(1) of the Schedule. More specifically, it argues that the Tribunal erred in accepting that FF had a reasonable explanation for his failure to comply with BDO and Aviva’s multiple requests for his financial information.
The Adjudicator agrees with Aviva’s position. The Adjudicator did not consider all of the information that BDO and Aviva requested. At the very least, FF’s 2013 personal income tax return was information that Aviva reasonably required in order to determine the quantum of FF’s IRB. Indeed, that same return, which was the first item that BDO requested in its letter of October 29, 2014, formed the basis for FF’s own calculation of the IRB’s quantum. Unfortunately, after BDO’s initial request for this information, FF did not provide Aviva with anything for almost two years – i.e., until either August 27 or September 7, 2016 – when he finally gave Aviva a copy of his 2013 personal tax return. For these reasons, the Adjudicator found that, insofar as his 2013 personal tax return is concerned, FF clearly breached s. 33(1).
As for FF’s explanation for his delay in complying with BDO and Aviva’s requests for information, the Tribunal accepted FF’s assertion that “he required additional time to obtain information about his business and is elderly.” However, there is no evidentiary basis for that finding. Based on the record before the Tribunal, which the Adjudicator reviewed in its entirety, BDO and Aviva’s requests for information went unanswered until, at the earliest, either August 27 or September 7, 2016. At no point did FF or his counsel write to explain the difficultly in gathering this information, whether due to FF’s age or any other reason he cited before or now. There might have been any number of reasonable explanations for FF’s delay. None were ever offered. There was only silence.
Any explanation that FF offers now for failing to comply with BDO and Aviva’s multiple requests for information is simply a bald, after-the-fact assertion. The suggestion, which the Tribunal accepted, that he “required additional time to obtain information about his business and is elderly” appears for the first time in the record in FF’s reply submissions filed before the hearing. The other explanations he now offers for his delay, for example his age, injuries, and pre-existing conditions, are undocumented assertions. None of these is supported by any evidence accounting for FF’s delay in responding to BDO or Aviva. In fact, the record belies FF’s position. FF received a copy of his 2013 personal tax return from the accounting services firm that prepared it by letter dated May 10, 2016, months before he eventually provided it to Aviva. Thus, based on the record before me, I refuse to accept any explanation that FF now offers for his delay.
The Tribunal’s conclusions must be based on evidence, not speculation or conjecture. Given the lack of evidence explaining FF’s delay in responding to BDO and Aviva’s requests for financial information, the Tribunal’s decision involved a significant error of fact that, if corrected, would have affected its decision. The consequence provided in s. 33(6) applies.
The only remaining question is when this consequence should begin to apply. In its request for reconsideration, Aviva takes no issue with the Tribunal’s determination, mentioned above, that there was “no dispute that the applicant is entitled to an income replacement benefit from June 10, 2014 to May 26, 2015.” For that reason, the Adjudicator found that FF is not entitled to an IRB after May 27, 2015. Again, given that FF finally provided Aviva with a copy of his 2013 personal income tax return on either August 27 or September 7, 2016, he is not entitled to an IRB for the remainder of the claim period, which ended on June 3, 2016.
Based on the evidence the adjudicator granted Aviva’s request for reconsideration in part and vary the Tribunal’s decision of March 22, 2017 to provide that FF is entitled to an IRB from only June 10, 2014 to May 26, 2015.