Plaintiffs seeking productions in actions with their long-term disability insurers often do not receive what they should. Insurers provide incomplete affidavits of documents and refuse to hand over relevant and probative evidence of their internal procedures. This case provides some interesting examples of questions to be asked at examination for discovery and how the Court will deal with productions arising from those questions.
In Heathcote v. RBC Life et. al., Justice Henderson of the Ontario Superior Court considered several production requests from the plaintiff. This summary will review the procedural issues and production orders.
BACKGROUND
The plaintiff in this action was an engineer and had been on long-term disability since October 2019. The insurer never questioned whether he was disabled according to the policy but had regularly withheld payments for various reasons. In their pleading, they allege this withholding of benefits was in accordance with their good faith duties to the plaintiff. As of the date of writing, monthly disability payments have been made on time every month since the Statement of Claim was issued. The plaintiff has made claims for bad faith handling of his file only. The defendants are RBC Life Insurance Company as well as the adjuster Anna Watroba who handled his file. The examinations proceeded on September 25 and 26, 2023 with the adjuster Anna Watroba on the first day and her superior Pamela Bowman (as representative for RBC Life) on the second day.
Litigating with the insurer and the adjuster can deliver valuable evidence to the plaintiff. Any differences between the evidence of the insurer and the adjuster will build the case for the plaintiff that the company is inconsistent and has poorly trained employees. For example, witnesses may give different evidence on: whether a claims manual exists, whether a long-term disability policy provides a psychological benefit to the insured, and whether a claims adjuster should provide the insured with the medical reports they base their claims decisions on.
PROCEDURAL ISSUE – LEAVE TO BRING MOTION
Litigating with insurers is challenging, expensive and time consuming. It is in the interest of the insurer to delay and drive-up costs. In this case the claim was issued in April 2023 and examinations for discovery were not conducted until September 2023. After the defendants refused to provide answers to a number of production requests at that discovery, the plaintiff passed the trial record to keep the matter moving efficiently towards trial.
The plaintiff brought a motion to compel answers to refused questions and to compel further production of documents associated with those refusals. The insurer spent much of the time at the hearing of this motion arguing that by passing the trial record the plaintiff had forfeited any right to a motion regarding their undertakings or refusals. This argument was rejected as rendering parts of Rule 48 “meaningless”. Even if the plaintiff requires leave for such a motion, leave would be granted in the interests of justice. Parties should not refuse to answer relevant questions and then rely upon the passing of a trial record to never answer those questions or fulfill their undertakings.
This case is therefore a precedent for moving a case quickly – passing a trial record then dealing with undertakings and refusals at a later date.
PRODUCTIONS ORDERED
The defendant, RBC Life, refused to provide contact information for former employees of the company citing privacy concerns. The Court ordered the last known contact information be produced for former employees. This applies to any witnesses who may in the future leave RBC Life’s employ.
The adjuster produced a resume as part of the productions at the examination for discovery. In that resume noted familiarity with something called the “I Make It Right” Guidelines (Guidelines). The Guidelines were ordered to be produced as “the expertise she brings to her duties as an adjuster is a combination of her prior training, education and experience”.
The most significant production ordered was the “complete” “entire” and “whole” RBC Life Claims Manual. The Claims Manual was requested to be produced. RBC Life refused on the basis that it was “not relevant”.
After the motion was served, counsel for the defendants provided an index of the manual and produced five of the chapters they deemed relevant. Justice Henderson wrote: “it is not sufficient for defence counsel alone to vet a document and then decide to produce only what defence counsel feels is relevant. Without casting any aspersions in this case, I accept that there is a level of distrust between parties in insurance litigation cases, particularly in bad faith cases. It will never be perceived as fair if one side need only produce documents that they feel are relevant. Opposing counsel should have some input into the decision as to which documents are relevant.” The RBC Life Claims Manual was ordered to be produced as a whole even though some sections (such benefits during a maternity leave) were clearly irrelevant to the issues in dispute in this action.
The defendants provided in their affidavit of documents a chart that documented payments made to the plaintiff between September 2020 and May 2022. This was at a time when the plaintiff was disabled and was seeking to provide a prospective landlord with proof of a consistent stream of income. Unfortunately, the chart is inaccurate as his payments were regularly being withheld. When questioned about creating an inaccurate chart of payments the adjuster adopted the response of her counsel “You pull it off a computer”. This answer was held to be inadequate as “one cannot simply assign the responsibility for creating a document to a computer”. The adjuster was ordered to explain the information available and the actions she took to create the chart.
PRODUCTIONS NOT ORDERED
The plaintiff was blood-and-urine tested for drugs by a medical assessor retained by the defendant. The handling adjuster wrote a memorandum to the file that she advised the insured he may be “blood, urine or hair sampled” as a part of the assessment process. The plaintiff now alleges that it was improper and contrary to the terms of the policy to drug test an insured. In order to assess the blameworthiness of the conduct, the plaintiff sought an answer as to how many urine, blood and hair sample requests were made on files the adjuster handled. This request has some relevance if the plaintiff is trying to prove that the adjuster systematically ordered drug testing for no practical reason. However, requiring the defendants to review all her past cases to determine if there was drug testing would offend the principles of proportionality. Therefore, the defendants were not ordered to answer this question.
As part of the punitive damages claim, the plaintiff sought information regarding the profitability of the insurer. The defendant refused to answer this question at the examination for discovery. At this point, since RBC Life is a public corporation, some financial information is publicly available, and no further response is ordered. The precise amount of profit is relevant for the triers of fact to determine a quantum of damages. The plaintiff may be entitled to more information at a later stage.
COSTS
The plaintiff submitted a costs outline for this motion of 13 hours, $6,530.50 substantial indemnity or $4,782.39 partial indemnity. The defendant submitted a costs outline for this motion of 102 hours, $28,694.12 substantial indemnity or $17,263.71 partial indemnity.
The Court invited the parties to make submissions as to costs if they could not agree on that issue. RBC Life made a Rule 49 offer to resolve the matter of costs for $4,783.39 (one dollar more than partial indemnity costs of the plaintiff). The plaintiff accepted this offer.
Vulnerable and disabled persons should not be intimidated by excessive or exaggerated costs outlines submitted by defendants on straightforward undertakings motions.
CONCLUSION
Long-term disability insurers will often refuse to hand over relevant and probative evidence of their internal procedures and training. It is incumbent on plaintiff’s counsel to ask the right questions and compel answers through to an order. The benefits to obtaining these documents for use at trial makes the effort worth it.
