A recent Financial Services Commission of Ontario (FSCO) decision - which granted a special award when there were no benefits in dispute - should prompt adjusters to follow a set of best practices to avoid a similar decision in the future, Kadey B.J. Schultz, a partner at Hughes Amys LLP, told delegates of the Ontario Insurance Adjusters' Association (OIAA) annual conference.
Schultz referred to the October 2010 FSCO arbitration, Cowan & Motor Insurance, during her joint presentation with Laurie Walker, McLaren's director of Ontario accident benefits. The presentation was entitled 'AB Update: Looking Forward Into the Future.'
"The most important part of Cowan & Motor is that it's a case about a special award when there were no benefits in dispute at the time of arbitration," Schultz said.
"For all of those years in which we felt fairly confident that if we resolved the issues in dispute, the claimant wouldn't proceed to arbitration on just the claim for special award - or an arbitrator would be loath to award a special award when there were no benefits outstanding because they had been resolved consensually and voluntarily - I submit those days have been over for about three years now.
"If people weren't listening, then Cowans is the decision to really, really get your attention."
Schultz urged adjusters to follow best practices to avoid these kinds of special awards in the future. Her suggestions included:
No one is holding the insurer or adjuster to a standard of perfection. You have to do your best and do what's reasonable.
An examiner or supervisor is expected to have sound and moderate judgment. But if a mistake in judgment is made, a second pair of eyes in an organization should review the file to make sure the first error in judgment is rectified.
Take reasonable steps that a reasonably prudent and careful examiner would take in the adjudication process.
Schultz gave an example of what reasonable and moderate steps might entail. For example, if a claimant says he or she should be bounced out of the Minor Injury Guideline due to pre-existing medical conditions, reasonable steps would include obtaining documentation. If the documents obtained are difficult to read or are illegible, as is the case with many doctors' records, then pay to have them transcribed.
"A reasonable and moderate decision cannot be made on illegible information," she said.
Sunday, February 13, 2011
Ontario Court of Appeal allows cross-claim, despite being beyond limitation period
defendant can still file a cross-claim for contribution and indemnity even after the limitation period of the plaintiff naming that individual has expired, Ian Gold, a founding partner of Thomas Gold Pettingill Lawyers, told delegates of the Ontario Insurance Adjusters' Association (OIAA)'s annual conference.
Gold delivered a presentation on casualty claim developments on Feb 9. During the seminar, he pointed to the Ontario Court of Appeal case, Waterloo Region District School Board v. CRD Construction Ltd.
In this case, a severe storm blew down the walls of a new school gymnasium that was under construction in 2002. At that time, the Professional Engineering Act provided a 12-month limitation period for the engineer that provided the engineering services for the construction of the gym.
In 2008, the Waterloo school board commenced an action. Since the limitation period had expired against the engineer, the school board named various contractors that had constructed the gymnasium.
The named defendants filed various cross-claims against the engineer seeking contribution and indemnity, Gold said.
"And that was the question before the court: Could these defendants, even though it was beyond the limitation period, advance a claim for contribution and indemnity beyond the limitation period against the engineer? And the court said, ‘Yes,'" Gold said.
Under the Limitation Act, claims for contribution and indemnity have a two-year limitation period from the time a defendant was served with a statement of claim, Gold said.
"There may be a knee-jerk reaction to say, ‘Oh, the limitation period is over and those [plaintiffs] weren't smart enough to sue me," he said. "Well, one of those named defendants might be smart enough, and you have to worry about that for two years."
Gold delivered a presentation on casualty claim developments on Feb 9. During the seminar, he pointed to the Ontario Court of Appeal case, Waterloo Region District School Board v. CRD Construction Ltd.
In this case, a severe storm blew down the walls of a new school gymnasium that was under construction in 2002. At that time, the Professional Engineering Act provided a 12-month limitation period for the engineer that provided the engineering services for the construction of the gym.
In 2008, the Waterloo school board commenced an action. Since the limitation period had expired against the engineer, the school board named various contractors that had constructed the gymnasium.
The named defendants filed various cross-claims against the engineer seeking contribution and indemnity, Gold said.
"And that was the question before the court: Could these defendants, even though it was beyond the limitation period, advance a claim for contribution and indemnity beyond the limitation period against the engineer? And the court said, ‘Yes,'" Gold said.
Under the Limitation Act, claims for contribution and indemnity have a two-year limitation period from the time a defendant was served with a statement of claim, Gold said.
"There may be a knee-jerk reaction to say, ‘Oh, the limitation period is over and those [plaintiffs] weren't smart enough to sue me," he said. "Well, one of those named defendants might be smart enough, and you have to worry about that for two years."
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