McCague Borlack LLPLitigation Boutique, GLOBAL Litigation Law Firm

 

 

 

Articles and Publications

April 2012

Recent Decision: Case Summary

Aweys and Intact Insurance

Arbitrator Richard Feldman released the decision in Aweys and Intact Insurance on March 19, 2012.

Intact Insurance Company, Belair Insurance, Nordic Insurance Company and Trafalgar Insurance Company (the Insurers) brought a motion for a stay of proceedings1 in 15 arbitration cases pending at the Financial Services Commission of Ontario (FSCO). The motions were heard together.

The cases all involved claims for statutory accident benefits submitted by or on behalf of insured persons from three rehabilitation facilities: Assessment Direct Inc.; Osler Rehabilitation Centre; and, Metro Rehabilitation Centre (the Facilities).

The Insurers take the position that the Facilities are related to each other and that many of the claims submitted were of dubious merit, that the Facilities engaged in conduct that was deliberately intended to unjustly enrich the Facilities, and in some instances, allegations of misrepresentation to the Insurers.

The Insurers commenced an action in the Superior Court against the Facilities and their principles for general and punitive damages, a declaration of unjust enrichment, an accounting and disgorgement of profits and a declaration that the Insurers need not pay any future or outstanding amounts. The action is at its early stages. The Insurers brought the motion to stay the FSCO proceedings until the conclusion of its court action.

The list of abuses allegedly perpetrated by the Facilities includes recommendations of very large or excessive amounts of treatment for simple soft tissue injuries; continuing to recommend treatment in the absence of improvement; recommendations of payments of attendant care and housekeeping up to two years, in unchanging amounts, and often for people who have returned to work.

Arbitrator Feldman acknowledged the importance of Insurers fighting perceived abuses in the accident benefit system. But he noted that his discretion to stay the proceedings required more evidence than presented. Arbitrator Feldman dismissed the Insurers' motions on the grounds that the Insurers failed to establish on a balance of probabilities that it would suffer irreparable harm if the motions were not granted, or that allowing the case to proceed on its merits would constitute an abuse of process.

Summary

To see where this type of ruling is headed, we will have to

  1. watch whether this decision is appealed and
  2. monitor the court proceedings against the Facilities (in the pleadings stage).

1 Pursuant to section 21 of the Statutory Powers Procedure Act

 

TORONTO | OTTAWA | KITCHENER | BARRIE | LONDON

Copyright McCague Borlack LLP - Legal Notice | mccagueborlack.com | Follow us on Twitter twitter

McCague Borlack LLP is a member of the Canadian Litigation Counsel, a nationwide affiliation of independent law firms. Through CLC's association with The Harmonie Group, our clients have access to legal excellence throughout North America, the U.K. and Europe.

clcnow.com | harmonie.org