Applicant fails to appeal to LAT within 2 Years - ST v Economical Mutual Insurance Company- 16-003034 v Economical 2017 CanLII 59507 (ON LAT)

October 18, 2017, Kitchener, Ontario

Posted by: Robert Deutschmann, Personal Injury Lawyer

ST v Economical Mutual Insurance Company- 16-003034 v Economical 2017 CanLII 59507 (ON LAT)

Date of Decision: September 7, 2017
Heard Before: Adjudicator Heather Trojek, Vice Chair

HOUSEKEEPING AND ATTENDANT CARE BENEFITS: Applicant fails to appeal denial of benefits within the two year period; applicant is statutorily barred from proceeding with application before the LAT; insurer provided clear and unambiguous refusal of benefits.

Issue:

1. Is ST precluded from proceeding with her application for ongoing entitlement to attendant care and housekeeping and home maintenance benefits because she missed the statutory two-year time limit to dispute Economical’s denial?

RESULT:

1. ST is barred from proceeding with her application for attendant care and housekeeping and home maintenance benefits despite having a catastrophic impairment because she did not dispute the stoppage of these benefits within two years of Economical’s denial.

The parties agreed that S.T. was injured in a car accident on September 12, 2008 and sought benefits from Economical. She was struck while walking across an intersection and sustained a variety of injuries including multiple fractures in her left shoulder. Following the accident ST was hospitalized and required surgery to repair her orthopedic injuries.

After the accident numerous Form 1’s or Assessment of Attendant Care Needs forms were completed on behalf of ST and Economical. ST underwent IE examination resulting in a Form 1 dated March 17, 2010, six months before the two year anniversary of the accident. This is the most recent pre-104 week Form 1 on record and recommends that ST receive $1,851.35 per month in attendant care benefits.

On August 11, 2010, Economical approved an Application for Approval of an Assessment or Examination (OCF-22) in the amount of $1,113.96 to conduct a file review for evaluation of catastrophic impairment (CAT) and submit a CAT application (OCF-19), if required. There is no evidence that the Doctor completed the approved OCF-22 assessment.

In a letter and Explanation of Benefits (OCF-9) dated August 26, 2010 Economical advised ST that as of September 12, 2010 attendant care and housekeeping and home maintenance expenses incurred more than 104 weeks after the accident would not be paid unless she was determined to be catastrophically impaired. The letter included an Application for Catastrophic Impairment (OCF-19) for ST to complete but was not however submitted at that time.

ST was paid a total of $9,512.85 in housekeeping and home maintenance benefits and $66,777.92 in attendant care benefits by Economical from the date of the accident up until September 12, 2010.   In 2011 and again in 2013 and 2014 ST submitted occupational therapy progress reports to Economical confirming her ongoing need for attendant care services. There is no evidence that expenses for the services were submitted to Economical.

ST did not submit an OCF-19 until May 13, 2015. After the OCF-19 was submitted, Economical requested that ST attend a section 44 multidisciplinary CAT assessment. Based on the findings of this assessment, Economical informed ST in a letter dated November 4, 2015, that her CAT application was approved.

ST then submitted claims for attendant care and housekeeping and home maintenance benefits ongoing from 104 weeks post-accident because Economical had accepted that she was catastrophically impaired. However, Economical denied her claims for attendant care and housekeeping expenses because she did not dispute the initial denial of these benefits within the two year time period required by the Schedule.

ST applied to the LAT.

ST argued that there was no proper denial of the benefits because:

• the denial was equivocal or unclear;
•  the denial was not valid because ST had not been found to be catastrophically impaired and therefore was not entitled to claim the benefits;
• the time limit for applying for a catastrophic determination the two year limitation period cannot apply to benefits that flow from it, and;
• the two year limit is not triggered until ST discovers that she meets the test of catastrophic impairment.

Economical argued that there was a proper denial of the benefits for the following reasons:

• The denial was clear and unequivocal;
• It is the denial of specific benefits that triggers the two year time limitation, the fact that ST was later found to be catastrophically impaired is irrelevant;
• Even if its denial was not legally correct it still triggers the two year time clock, and;
• The principal of discoverability does not apply to the scheme of statutory accident benefits.

REASONS AND ANALYSIS:

The Arbitrator noted that the one of the issues to be determined is whether Economical’s “denial” in August 2010 was sufficient to trigger the two year time limit for applying for mandatory mediation at FSCO. The key to determining this issue is found in the Supreme Court of Canada decision of Smith v. Co-operators, which states that a limitation period cannot commence unless the insurer’s denial is in writing and is found to be clear and unequivocal - the reasons for the denial must be “straightforward” and in “clear language”. It must also provide information about the different stages in the dispute resolution process which an “unsophisticated person” can understand and include information about the relevant time limits.

Having reviewed the letter and OCF-9, dated August 26, 2010, the Arbitrator found that Economical’s denial of benefits meets all of the requirements set out in Smith and Cooperators and therefore constitutes a clear and unequivocal denial of ST’s entitlement to ongoing attendant care and housekeeping and home maintenance benefits.  At the bottom of the OCF-9 it is states, “Warning: Two Year Time Limit: You have TWO YEARS from the date of your insurer’s refusal to pay or reduce benefits to arbitrate or commence a law suit in court.”

ST submits that the notice provided by Economical is not clear and is equivocal because it:

• Does not contain the words like “refused”, “denied” or “stopped”;
• Does not explain that ST may not be entitled to the denied benefits even if she is found to be catastrophically impaired at a future date and does not commence an appeal within two years;
• The boxes on page 4 of the OCF-9 which say the benefits are not payable are not checked off.

The Arbitrator found Economical’s notice to ST to be clear, explicit and devoid of ambiguity. On this basis the Arbitrator found that Economical’s denial complies with all the factors required by Smith and Cooperators. Having found that Economical issued a clear and unequivocal denial. The Arbitrator found that the two-year time limit to dispute the denial began to run as of August 26, 2010. Since ST did not dispute Economical’s denial until she commenced this proceeding on September 29, 2016, six years after her benefits were denied, she missed the two year time limitation and is therefore barred from proceeding with her application with respect to attendant care and housekeeping and home maintenance benefits.

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Deutschmann Law serves South-Western Ontario with offices in Kitchener-Waterloo, Cambridge, Woodstock, Brantford, Stratford and Ayr. The law practice of Robert Deutschmann focuses almost exclusively in personal injury and disability insurance matters. For more information, please visit www.deutschmannlaw.com or call us at 1-519-742-7774.

It is important that you review your accident benefit file with one of our experienced personal injury / car accident lawyers to ensure that you obtain access to all your benefits which include, but are limited to, things like physiotherapy, income replacement benefits, vocational retraining and home modifications.