Volume. 6 Issue. 9 – March 9, 2022
The SABS are fraught with procedures and notice requirements in the name of procedural fairness. The decisions covered this week consider two cases regarding s.36, the extent to which notice requirements are scrutinized and the associated penalties or lack thereof for noncompliance.
In the first case, the notice requirements are considered under s.36 (4) of the Schedule with a significant cost of non-compliance on a NEB case.
In the second case, there is found to be no remedy for non-compliance when an insurer doesn’t send an OCF 3, despite what was characterized by the Tribunal as an “injustice”.
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Two Years NEB Awarded Due to Insurer Non Compliance
Non Compliance Results in NEB to 104 Week Mark – In Mahhamoud v Aviva (19-010985), Mahhamoud was awarded NEB through to the 104 week mark due to Aviva’s non-compliance with s.36 of the Schedule. The interplay between s.36 (4) and s.36 (5) were considered in this decision.
Following receipt in January 2018 of an OCF3 endorsing entitlement to NEB, Aviva requested consent to order CNRs from the family doctor, framing this request under s.36(4)(c) and s.33(1) of the Schedule. The Tribunal found that Aviva’s correspondence met the requirements of s. 36(4)(c) of the Schedule as it requested information from Mahhamoud under s. 33(1). However, this “does not end the analysis on the applicant’s entitlement to NEBs as suggested by the respondent’s submissions given s. 36(5) of the Schedule.”
In September 2018, Mahhamoud submitted a 2nd OCF3, also endorsing entitlement to NEB. Then on December 18, 2018 Mahhamoud produced the CNRs of his family doctor. In response, Aviva wrote to Mahhamoud on December 28, 2018 indicating in part “we’re unable to determine whether the recommendations made on your Disability Certificate meet the disability requirement for the specified benefit you are claiming, and we’re not able to pay your benefits at this time.”
There was as well notice of a pending IE, with the rationale being “The disability period appears to be inconsistent with the diagnosis or mechanism of injury.” The Tribunal found that said notice must have been in response to the earlier s.33 request from January 2018.
The Tribunal found there to be no evidence that upon compliance Aviva “took the second step of providing notice to the Applicant as required by s. 36(5) prior to its December 28, 2018 letter.” As a result, this letter was presumed to having been provided under s.36(5). To that end, said response was found to have fallen short of the obligations under s. 36(4)(b) of the Schedule.
It was “boilerplate and provided no medical reasons for the insurer’s denial of the applicant’s claim for NEBs. Even the respondent’s request for the three IEs does not comply with the requirement of providing the medical and other reasons for the examinations as required by s. 44(5) because the respondent again used boilerplate language and failed to state any specific details about the Applicant’s condition.”
Therefore, given this failure to comply, Aviva was obliged to pay NEB. Given there being no evidence of a proper notice having been provided further to s.36(4)(b), Mahhamoud was determined to be entitled to NEB from February 5, 2018 until December 11, 2019, the 104 week mark.
No Remedy for Injustice
No Consequences for Insurer’s Non Compliance – In Kunaseelan v Aviva (20-000565) the predominant issue was whether Kunaseelan was entitled to IRBs for any period prior to submitting the disability certificate. Neither party disputes that the disability certificate was submitted on November 14, 2019, however Kunaseelan contended that Aviva failed to comply with s.32(2) of the Schedule, which in turn disentitled Aviva from reliance upon s.36(3) of the Schedule to deny coverage. The Tribunal found for a fact that Aviva indeed failed to comply with s.32(2), having failed to provide Kunaseelan with the required OCF3.
Kunaseelan submitted that this non-compliance precluded Aviva from demanding a reasonable excuse for late submission of the OCF3 further to s.34 of the Schedule. In response, Aviva submitted that “section 34 of the Schedule is not applicable because 36(3) includes no timeline for the Applicant to comply with.” The Tribunal found that s.34 “has no application when considering whether the Applicant is entitled to any IRBs prior to November 14, 2019”. Agreeing with the reasoning in K.A v. Certas Home and Auto (17-002910), that “section 34 of the Schedule is a remedial provision for a missed time limit and that section 36(3) includes no time limit for it to be applied against.”
Further, Aviva’s failure to provide an OCF3 has “has no influence on section 36(3) of the Schedule. As noted above, the Schedule provides no consequence for a failure to comply with section 32(2). Similarly, there is no reference or connection between section 36(3) and section 32(2) of the Schedule.” The Tribunal recognized the “injustice in that the Applicant falls between these sections of the Schedule”, having not received an OCF3 as required under s.32, and then upon submission being denied entitlement to any period prior to the eventual submission. The Tribunal concluded nonetheless that “I have no remedy for this injustice, and it would be wrong for me to order payment of IRBs contrary to section 36(3) of the Schedule.”
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