Category: Interest

Darwich v. The Co-operators (20-015268)

The claimant applied to the LAT for a catastrophic impairment designation and the cost of a private addiction treatment centre. The claimant suffered injuries from an accident that culminated in him being prescribed increasingly higher amounts of morphine to relieve his accident-related back pain. At some point, the claimant’s historic substance abuse issues, which were dormant for many years, had resurfaced and he relapsed. The claimant subsequently turned to illicit drugs to cope with his pain and stress. He was diagnosed with polysubstance abuse disorder, depression and somatic symptom disorder. While the claimant was on a positive trajectory after completing an in-patient drug treatment program, he eventually relapsed while battling cancer and passed away shortly after the LAT hearing . Given that the claimant passed away shortly after the LAT hearing, the question of catastrophic impairment was rendered moot. The sole issue remaining was whether the claimant’s attendance at the private addiction treatment centre was reasonable and necessary. Adjudicator Norris considered whether the accident caused the claimant to experience depression, somatic symptom disorder and to relapse into polysubstance disorder. Adjudicator Norris held that the accident need not be the sole cause of the claimant’s injuries but need only be found to be a factor that materially contributed to the injuries. Adjudicator Norris concluded that the claimant’s polysubstance use disorder was directly caused by the accident, and the in-patient treatment program was an accident-related expense. Even though the addiction treatment received by the claimant could have been covered by OHIP, Adjudicator Norris found that it was reasonable and necessary, as expert evidence revealed that the urgency of the situation required immediate treatment and certain on-site care that an OHIP-funded facility could not provide for.

K.G. v. Motor Vehicle Accident Claims Fund (20-003724)

The claimant disputed his entitlement to ACBs in relation to a 1999 accident. The Fund stopped paying ACBs in 2000 without a proper notice, and agreed to reinstate ACBs with interest at the Form 1 rate of $120.40, and paid interest at 1 percent per month. The claimant requested that the LAT award ACBs at the rate of $5,575.31 per month from 2000 onwards based on a retroactive Form 1 completed in 2019. The claimant also requested interest at the rate of 2 percent per month, and a special award. Vice Chair Shapiro agreed that the Fund improperly stopped payment of ACBs without proper notice, and that the Fund correctly reinstated ACBs with payment back to 2000 at the rate of $120.41 per month, other than two periods in which a “top-up” of $331.10 was granted when the claimant moved residences. Vice Chair Shapiro rejected the retroactive Form 1 and the suggested need for 24-hour supervision. The retroactive Form 1 was completed by an OT will no familiarity of the Form 1 as it existed in 2000; the documents reviewed by the OT were scant; the OT’s evidence was contrary to the evidence of the claimant’s family members regarding the claimant’s independence; and the OT ignored the claimant’s recovery in the year or two after the accident. Additionally, the claimant’s current treatment team did not support the need for 24 hour supervision. As to interest, Vice Chair Shapiro held that the claimant was entitled to interest at the rate of 2 percent per month, rather than 1 percent per month, based on the Court of Appeal’s decisions in Federico v State Farm, and Sidhu v State Farm. Finally, Vice Chair Shapiro granted a special award of 10 percent on all ACBs that were wrongly withheld. The Fund inappropriately placed ACBs “on hold” without any provision in the SABS allowing it to do so, and there was a delay of almost 20 years in payment of ACBs.

Morrisey v. Wawanesa Insurance Company (2022 4398)

The claimant was injured in an accident in 2000, while the 1996 SABS applied. In 2018, the claimant filed a LAT dispute for (among other things) retroactive attendant care benefits. The Tribunal found the claimant was not entitled to retroactive ACBs because he had no excuse for the late Form 1. The Tribunal also held that the incurred expense definition applied to the claimant’s ACBs going forward, and that he was entitled to interest at the rate of 1 percent per month for overdue ACBs. The claimant appealed all three findings. The Divisional Court granted the appeal with respect to interest, holding that the Divisional Court decision in Federico v. State Farm, and the Court of Appeal’s decision in Sidhu v. State Farm, governed the outcome and that two percent interest applied for all claims related to accidents prior to September 2010. The Court dismissed the appeal on the other issues. The Court agreed that the Tribunal correctly held that the claimant was required to show why there was a delay in submitting his Form 1, and that the Tribunal’s conclusions related to the claimant’s arguments were questions of fact that were not open to appeal. The Court also agreed that the Tribunal correctly held that the incurred expense definition applied to all ACBs claims after September 2010 because the definition was a procedural change rather than a substantive change to the SABS.

Kunaseelan v. Aviva Insurance Company of Canada (20-000565)

The claimant sought entitlement to IRBs of $400.00 per week for the five month period between the date of loss and the date the OCF-3 was submitted. Adjudicator Norris dismissed the claim, holding that section 36(3) barred the claimant’s entitlement to IRBs for the period prior to OCF-3 submission. The claimant argued that the insurer failed to prove an OCF-3 in the application package, and that the insurer’s failure to comply with section 32(2) should result in her entitlement to IRBs during the period. The claimant relied upon a FSCO decision in Anthonipillai v. Security National in which a similar result was reached. Adjudicator Norris rejected the claimant’s arguments and found that the decision in Anthonipillai was incorrect and that the bar to receiving IRBs prior to submission of an OCF-3 was absolute. Adjudicator Norris also found that no interest was payable on IRBs that were back-paid to the claimant in May 2020 because the claimant had not provided sufficient information to support her claim for IRBs, meaning that IRBs were never actually overdue. Similarly, the claim for a special award was dismissed because the insurer was not required to pay IRBs while the claimant remained in non-compliance with requests for financial and income records.

Manoharan v. Allstate Canada (19-010782)

Allstate filed for reconsideration of the Tribunal’s decision which Vice-Chair Boyce ruled in the claimant’s favour and awarded her interest on the incurred amounts of three treatment plans and various other benefits. Allstate argued that Vice-Chair Boyce erred in fact and law in relation to section 38 and section 51, and that no interest was payable on the three treatment plans. Allstate noted that it was compliant with section 38, that no invoice for incurred services on the treatment plans had been submitted, and that it had paid all three treatment plans in full prior to the LAT Application, rendering section 51 moot. Vice-Chair Boyce granted the reconsideration, noting that Allstate did comply with section 38 by addressing the treatment plans within 10 days, and that the delay in approval and payment was a result of the claimant’s delay in participating in IEs.

Aslivo v. Aviva Insurance Canada (19-004717)

The claimant applied to the LAT seeking a special award and entitlement to interest on two lump sum payments of IRBs made by the insurer. The insurer sought repayment of an overpayment of IRBs. Vice Chair Flude began the analysis by stating: “While the Schedule has been characterized as consumer protection legislation and should be given a broad and liberal interpretation, it is important to bear in mind that the obligations of the parties are mutual. No level of broad and liberal interpretation can save a consumer who simply refuses to cooperate with an insurer.” With regards to the first lump sum payment of IRBs, Vice-Chair Flude separated the issues into two distinct periods. In the first period, leading up to an IRB response letter / s. 33 request, the insurer was not in compliance with its obligations under the SABS to respond to the IRB application within 10 days. In the second period (after making the request for documents), the insurer was in compliance with the SABS. Vice-Chair Flude found that the insurer was liable to pay interest during the period it was in non-compliance with the SABS. The insurer was not liable to pay interest on the lump sum amount for the period starting when the reasonable s. 33 requests were made until the s. 33 requests were complied with (at which time the insurer paid the lump sum amount). The second lump sum payment was made for a period during which the claimant’s entitlement to IRBs had been terminated based on IE assessments. The lump sum back payment was made after the claimant was re-assessed and it was determined that her condition had deteriorated such that she met the test for IRBs. Adjudicator Flude found that although the insurer had not acted unreasonably when terminating the benefit for a period, interest was payable on the lump sum back payment. The situation was found to be analogous to a claimant being successful in an application for an IRB to the Tribunal. Adjudicator Flude found that the insurer was entitled to repayment of an overpayment of IRBs for a specific period, as claimed. The claimant was not entitled to a special award.

Manoharan v. Allstate Canada (19-010782)

The claimant sought entitlement to various medical benefits, which the insurer had denied based on the MIG. At the LAT case conference, the insurer removed the claimant from the MIG and approved some of the treatment plans. At the LAT hearing, the claimant disputed entitlement to one treatment plan plus interest on the previously approved treatment plans, and claimed a special award. Adjudicator Boyce awarded interest on incurred treatment plans and found the disputed treatment plan payable. In terms of interest, Adjudicator Boyce found that it was payable when there was an overdue benefit, and that section 51 did not allow the insurer to avoid paying interest through the actions or inactions of the claimant. With respect to the disputed medical benefit for a physiatry assessment, Adjudicator Boyce found it payable as he believed it was reasonable and necessary given the claimant had not reached maximum medical recovery 1.5 years post-accident. Finally, Adjudicator Boyce granted a special award noting that the insurer had conceded that it mishandled certain aspects of its file and its submissions focused on how it tried to mitigate these “”inadvertences.”” Adjudicator Boyce criticized the insurer for delaying payments as it caused the claimant harm. Adjudicator Boyce awarded a special award in the amount of $1,500 plus 2% interest compounded monthly, representing approximately 10 percent of the disputed benefits.

C.W. v. Jevco Insurance Company ( 18-000790)

This is a reconsideration decision of Adjudicator Shapiro. The insurer requested reconsideration of Adjudicator Shapiro’s initial decision wherein he found the claimant entitled to retroactive ACBs with interest. The facts of this case were unusual. The claimant was a pedestrian struck by a vehicle. She did not have her own insurance. The driver of the insured vehicle did not advise his insurer of the accident. The insurer first learned of the accident when the claimant initiated a tort claim two years after the accident. The claimant was catastrophically impaired as a result of the accident. The insurer took an off-coverage position in the tort claim. Therefore, for a significant period of time, the claimant did not seek attendant care benefits nor was she aware of her ability to claim accident benefits. Adjudicator Shapiro found that there was a reasonable excuse for the claimant’s delay in applying for benefits given the insurer’s coverage position. Adjudicator Shapiro held that the claimant actively investigated coverage issues and then filed her accident benefits claim as soon as the only possible insurer reversed its coverage position and acknowledged it insured the vehicle that hit her. Therefore, Adjudicator Shapiro dismissed the reconsideration application concluding that the claimant was entitled to retroactive ACBs and interest was payable. Adjudicator Shapiro also reminded the insurer that interest was compensatory and not punitive.

Nijjar v. Pembridge Insurance Company (19-011065)

The claimant disputed his entitlement to IRBs for an 18 month period and interest on medical benefits that had been resolved. Adjudicator Lake dismissed the claim for IRBs. She placed little weight on a “Physical Description of Job” sheet and a job description attached to an employer’s confirmation form that indicated a physically demanding job, because of contradictory findings. For example, the claimant had reported during IEs that his job was not heavy but required extended standing. The Adjudicator was unable to clearly determine the claimant’s job title or duties, and as such was unable to determine which job duties he was unable to perform. Interest was awarded on the two medical benefits from the date they were incurred. She dismissed the argument that interest should not be payable until the date that the claimant submitted requested medical records from his family doctor.

S.M. v. Mutual Insurance Company (18-008474)

The claimant sought reconsideration of the LAT’s denial of retroactive ACBs and the decision regarding the amount of ACBs that were found payable. The accident occurred prior to September 1, 2010. Interpretation of the transitional provisions in the 2010 SABS and 1996 SABS was an issue in dispute, including interpretation of provisions relating to interest and the applicability of the requirement for benefits to be incurred before they are payable. The request for reconsideration was denied. Adjudicator Johal found that there was no error in law in the determination that there is no strict bar against filing an application for retroactive attendant care benefits, but the burden is on the claimant to “explain the urgency, impossibility or impracticability of compliance with s. 42(5) of the Schedule.” Adjudicator Johal found that there was no error in law in determining that the “incurred” definition applied to this claim, even though the accident occurred before September 1, 2010. Adjudicator Johal held that “rights are based on what is set out in the Insurance Act and regulations at the time of a claim rather than the date of the accident.” Adjudicator Johal found that there was no error in law in the finding that the applicable interest rate was 1%, in accordance with the 2010 SABS.