Insurers Must Provide Actual Reason(s) for Examinations Under Oath
Aviva Insurance Company of Canada v. McKeown et al., 2016 ONSC 6017
This application, brought by the insurer, was a test case on the issue of whether a justification is required to compel a person claiming statutory accident benefits to attend at an examination under oath if the insurer requests one pursuant to subsection 33(2) of Statutory Accident Benefits Schedule – O. Reg 34/10 (“SABS”). At the core of the application was the requirement under subsection 33(4) of the SABS that the insurer give the insured advance notice, including “a reason or reasons” for the examination.
The lawyers for the claimants persistently challenged Aviva’s requests for examinations under oath, citing that Aviva did not fulfill the requirement under s. 33(4) of the SABS to provide the reason or reasons for the examinations. As a result, the insurer brought this application and sought an order compelling the respondents to attend the examinations under oath.
Aviva’s position was that the notice requirement under s. 33(4) of the SABS is merely a matter of form, and is satisfied by general references to the purpose and/or scope of the examinations, such as the insurer simply indicating that the examination is requested to evaluate the insured’s entitlement to statutory accident benefits. The respondents submitted that the insurer must disclose the actual reason for the examination, and not just a general reference to the purpose or scope of the examination. Justice Matheson agreed with the respondents.
The Court followed its earlier 2016 decision in State Farm v. Aslan et al., which held that s. 33(4)3 regarding reasons and s. 33(4)4 regarding scope give rise to two separate obligations.
Justice Matheson also provided that this requirement to give a meaningful reason is in keeping with the insurer’s obligation of good faith. The concept that this notice is a mere matter of form is inconsistent with that obligation. The insurer must have a good faith reason to take this additional step and must be prepared to disclose it in advance of the examination.
The Court went on to compare a claim under the SABS to a tort action. In a tort action, the claimant has advance notice of the insurer’s position through a statement of defence, before any examination for discovery takes place. In addition, there would also be a corresponding right to examine the insurer. However, under the SABS there are no pleadings and no right to examine the insurer. These fairness issues are at least somewhat addressed through the requirement that the insurer give reasonable advance notice of its actual reasons for the examination under oath. This requirement also ensures that the insurers do not simply request examinations under oath as a matter of course.
Justice Matheson ultimately declared that a justification is required to compel a SABS claimant to attend an examination under oath pursuant to s. 33 of the SABS, specifically a reason or reasons that must be disclosed pursuant to s. 33(4)3 of the SABS.
What the Insurer Should Know
When requesting a statement under oath for accident benefits entitlement, the insurer must provide a reason for the statement and the scope of the statement.
|Mitch Kitagawa||Kentt Coburn (Articling Student)|