No Cameras Please! No Policy Breach by Insurer who Refused Video Recording of Medical Examination18-Apr-18
Greenidge v Allstate Insurance Company, 2018 ABQB 266
The recent Alberta Court of Queen's decision, Greenidge v Allstate Insurance Company, determined that an insurer was not in breach of Section B of the Standard Automobile Policy (the "Policy") for discontinuing the insured's benefits after she refused to attend a medical examination unless it was video recorded. The Court held that an insurer can require a medical examination under the terms that the medical practitioner permits which, in this case, included no video recording.
Following a motor vehicle accident, Ms. Greenidge applied for Section B benefits to cover expenses related to treatment of whiplash and TMJ injuries. Pursuant to the Policy, Allstate retained a medical practitioner, Dr. Grade, to perform a medical examination of Ms. Greenidge. Ms. Greenidge requested that the examination be video recorded, but Dr. Grade did not accept videographers. It was Allstate's position that Ms. Greenidge was "under a contractual obligation to attend an appointment for an examination with a duly qualified medical practitioner of [their] choice" and that nothing in the Policy allows for videographers. Ms. Greenidge suggested that she attend with a videographer at her expense, or, alternatively, attend an examination with another medical practitioner who allows video recording. Allstate declined both options, the examination never proceeded and Allstate declined all further coverage to Ms. Greenidge under Section B.
Ms. Greenidge alleged that Allstate breached its duty of utmost good faith by denying her the right to have the examination video recorded. As well, Ms. Greenidge argued that as the examination would not address her TMJ injury, Allstate should not have denied coverage in relation to any TMJ expenses.
Allstate took the position that Ms. Greenidge was asking the Court to find an implied condition in the Policy which would "fetter Allstate's legislated ability to select its chosen medical practitioner", and that that would be "contrary to the purpose and intention of the requirement for an insured to attend a medical examination by a professional chosen by the insurer."
Duty of Good Faith
The Honourable Mr. Justice K.G. Nielsen outlined the duty of utmost good faith in insurance contracts.
The insurer is vulnerable to the insured because it relies on information provided by the insured in order to decide whether to provide insurance coverage as well as in conducting its investigation and payment of a loss; the insured is vulnerable to the insurer because the ultimate decision regarding whether to pay out a loss, and in what amount, is entirely in the hands of the insurer: Barbara Billingsley, General Principles of Canadian Insurance Law, 2nd ed (Markham, Ont: LexisNexis Canada Inc, 2014) at 50.
In order to find a breach of the duty of good faith by the insurer, the insurer must have acted in some way without reasonable justification (Gordon G Hilliker, Insurance Bad Faith, 3d ed (Markham, Ont: LexisNexis Canada, 2015) at 49-50).
Determining what the insurer is permitted to require of its insureds and when they can disentitle an insured to coverage requires interpreting the Policy. The Alberta Court of Appeal recently summarized the law on interpretation of insurance policies in Cardinal v Alberta Motor Association Insurance Co.:
11 If the language of an insurance policy, when read as a whole, is unambiguous, effect should be given to the clear language. If the language is ambiguous, the ambiguity should be resolved through the application of the general rules of construction. If ambiguity remains after application of the general rules, then the policy can be construed against the insurer pursuant to the principle of contra proferentem. Coverage provisions should be construed broadly but exclusions should be construed narrowly… Automobile insurance policies, including endorsements, are approved by the legislature so there is an element of statutory construction involved in their interpretation. This requires a court to determine the meaning of the policy in its entire context, in its grammatical and ordinary sense harmoniously with the scheme of the legislation, the object of the legislation, and the intention of the legislature…
The Rules of Court and Section B
Justice Nielsen held that the Alberta Rules of Court provisions with respect to medical examinations, particularly Rule 5.42(1)(b) which permits a person who is to be the subject of a medical examination by a health care professional to video record their examination, are not incorporated in the Policy. Since the Rules govern the practice and procedure in relation to persons who come before the Courts for resolution of a claim, and the requirement by an insurer for a medical examination under Section B is not in the context of litigation before the Court, the Rules do not apply.
As well, Justice Nielsen stated that the legislature has chosen not to incorporate reference to Rule 5.42 in the Automobile Accident Insurance Benefits Regulation. As such, he held that it is not appropriate to read into the Policy a term that Rule 5.42 applies to medical examinations under the Policy.
Whether There Was a Breach of Section B
Justice Nielsen ultimately held that the provision in Section B is not ambiguous. Special Provision 4 allows an insurer to select a medical practitioner. The medical practitioner "was fully entitled to establish an examination policy as to how the Medical Examination would be conducted", which in this case was a policy disallowing videographers.
Justice Nielsen held that Allstate did not act unfairly in insisting that Ms. Greenidge attend the examination with their chosen medical practitioner, Dr. Grade, on the terms as determined by Dr. Grade. Nothing in Section B restricts how a medical practitioner conducts their examinations. Therefore, Allstate did not breach the terms of the Policy or its duty of utmost good faith to Ms. Greenidge when it discontinued coverage for further benefits pursuant to Section B.
With respect to the TMJ injuries, Justice Nielsen noted that Special Provision 6(b) of Section B provides that a "person shall not bring an action to recover the amount of a claim under this section unless the requirements of provision (4) are complied with." Special Provision 6(b) does not refer to "subclaims" or "separate claims" based on the nature of the injuries suffered, but, rather, refers to an action to recover the amount of a "claim." Justice Nielsen held that since Ms. Greenidge was in breach of Special Provision 4, she was no longer entitled to commence an action against Allstate to recover an amount in relation to any injuries she allegedly suffered as a result of the motor vehicle accident, including her TMJ.
We understand that the decision is likely being appealed. We will monitor the outcome of any appeal and provide an update in the future if warranted. In the meantime, based on Justice Nielsen's decision, if insureds refuse to attend a Section B medical examination on the basis that it will not be video recorded, they run the risk of having their benefits discontinued. As determined by Justice Nielsen, insurers will not likely be found to be in breach of their duty of good faith if they discontinue benefits in these circumstances.