The Ontario Court of Appeal, in Aviva Insurance Company of Canada v. McKeown, 2017 ONCA 563 (CanLII) determined an insurer is not required to provide a “justification” to compel an applicant for benefits to attend an examination under oath pursuant to subsection 33(2) of the Statutory Accident Benefits Schedule.
The Court determined by requiring insurers to justify their exercise of conducting an EUO, the original judge drew “unsupported inferences, employed extraneous considerations, and failed to consider the entire legislative context of [the subsection].” The Court was also critical of the applications Judge for concluding (absent an evidentiary record) that EUOs would increase the cost of claims. The Court looked at the regime that the Legislature had set up for accident benefits and noted (paragraph 38):
…the legislature created the EUO as one mechanism in a major initiative to control the overall costs of the regime. The court must give effect to this object of the legislature and the evident legislative perspective that EUOs are a mechanism to reduce the overall cost of the system. Interpreting the provision on the supposition that EUOs increase costs, seems to me to run counter to the legislative objective for creating the provision to reduce costs.
The Court was also critical of the Judge’s analogy of the EUO notice to civil litigation – that a litigant in a civil case would have reference to the pleadings to determine the issues which may be covered in the examination for discovery. The Court stated that the SABs process is intended to be non-adversarial and thus an analogy to civil litigation was “misplaced.”:
[43] I regard the application judge’s analogy to civil litigation to be misplaced. It does not matter that a claimant in a tort action would have advance notice of the insurer’s position through a statement of defence before any examination for discovery would take place. Analogies to civil litigation are unhelpful in a statutory regime meant to replace tort law because the legislative object of the automobile insurance regime is to replace the tort resolution of disputes arising from automobile accidents with the process it prescribes. That an applicant “shall submit to an examination under oath” on a proper request of the insurer is clearly set out in the regulation. Effect must be given to the provision as written rather than attempting to make it comport with the civil litigation process.
The court concluded that: “A general statement of the purpose of the EUO that gives the applicant notice of the general type of questions that will be asked is sufficient.”
In a very helpful gesture, the Court reviewed two notice letters and held that they satisfied the requirements of notice (paragraph 76):
An examination under oath is required in order to assist [Aviva], your insurer, in determining entitlement to specified benefits, medical and rehabilitation benefits, attendant care benefits, housekeeping and home maintenance expenses and costs of examination arising from the loss of April 25, 2015. The scope of the examination will be limited to matters that are relevant to your entitlement to said benefits.
Paragraph 79:
An examination under oath is required in order to assist [Aviva], your insurer, in determining entitlement to specified benefits, medical and rehabilitation benefits, attendant care benefits, housekeeping and home maintenance expenses and costs of examination arising from the loss of April 25, 2015. The scope of the examination will be limited to matters that are relevant to your entitlement to said benefits
The reasoning of the decision together with the reference to specific examples of notice, should now, unequivocally, clarify this issue and put to bed disputes over EUO notices and allow insurers to use the tools they were given in the adjudication of claims.
