J. 2000 SKQB 340 Q.B.G. A.D. 1999 No. 170 J.C.M. IN THE QUEEN’S BENCH JUDICIAL CENTRE OF MELFORT BETWEEN: DANIEL HURD and MEDICAL SERVICES INCORPORATED DEFENDANT Grant Carson for the plaintiff Richard K. Gabruch for the defendant JUDGMENT DIELSCHNEIDER J. July 27, 2000 [1] The plaintiff, Daniel Hurd, purchased medical insurance policy from the defendant, Medical Services Incorporated (MSI), for the period of time he expected to reside in Chicago, Illinois, U.S.A. pursuing studies in optometry. The policy was in effect for the period commencing August 1, 1997 and ending July 31, 1998 and provided coverage to Hurd except for those periods when he was in Saskatchewan. [2] Hurd ordinarily resided with his parents at Melfort, Saskatchewan. While home from Chicago during study break Hurd had an accident while water-skiing following which he experienced chest pains. On August 3, 1997 he consulted Dr. Nelson at Melfort who believed he had strained muscle. When the pain persisted, Hurd, on August 8, 1997, saw the family’s doctor, Dr. Lionel Lavoie. After x-ray, Dr. Lavoie determined that Hurd had pneumothorax, collapsed lung, which he associated with the events of water-skiing engaged in by Hurd, and he referred him to Dr. S.C. Kanthan at the Royal University Hospital in Saskatoon. [3] Dr. Kanthan resolved the pneumothorax by performing thoracostomy, procedure whereby tube is placed into the pleural cavity, the chest area where escaped air is collecting. The tube drains the air and allows the lung to re-inflate. When Dr. Kanthan removed the tube the lung collapsed second time whereupon the procedure was repeated, successfully so. [4] On August 11, 1997, Dr. Kanthan discharged Hurd from hospital and reported to Dr. Lavoie that the pneumothorax was resolved and that follow-up treatment was not necessary. [5] On August 12, 1997, Hurd returned to Chicago to continue his studies. [6] On February 6, 1998, while in class, Hurd experienced discomfort in his chest. Four days later, on February 10, 1998, he had friend drive him to emergency at Mercy Hospital in Chicago. Emergency personnel diagnosed pneumothorax and hospitalized him referring his case to Dr. Craig Adams. [7] Dr. Adams confirmed the diagnosis. He expressed to Hurd his belief that the cause of his condition was bleb which required surgery. bleb is bubble-like structure which develops when there is coalescence of air sacs in the lung. [8] Dr. Adams advised immediate surgery. [9] Two, perhaps three, events combined to postpone the “immediate” surgery to February 24, 1998. Hurd was then writing final examinations and wanted to complete them. On February 12, 1998, when Hurd learned that Medex, the agency representing MSI in the U.S.A., was refusing to authorize payment, Hurd became concerned and contacted MSI in Saskatoon and his parents and Dr. Lavoie in Melfort concerning his position. And thirdly, hospital scheduling had to be taken into account. [10] In any event Dr. Adams agreed to postpone the surgery but subject to conditions. Hurd was never to be alone. He was not to drive an automobile. He was to remain within fifteen minutes travelling time from Mercy Hospital. And he would immediately return to emergency if the symptoms became more severe. [11] On February 24, 1998, the surgery proceeded. Dr. Adams performed thoracotomy with bleb resection, procedure that involved opening up the chest cavity to permit stapling of the offending bleb. [12] The cost to Hurd for the surgery was $26,864.46. MSI rejects Hurd’s claim for reimbursement on two grounds. MSI states that Hurd should have returned to Saskatchewan for the surgery and that, in any event, Hurd’s condition pre-existed purchase of the insurance policy and was not covered thereby. [13] The questions raised by MSI in defending Hurd’s claim are therefore essentially two. Was the surgery necessarily performed in Chicago or could it have been postponed and performed later in Saskatoon? Even if necessary, was the bleb pre-existing condition which in any event exempted MSI from payment under the policy? [14] The medical reports on Hurd’s condition agree that surgery was necessary. There is also substantial agreement that the surgery could be postponed for time. But there is disagreement over the length of any postponement, or the patient’s ability to travel home to Saskatchewan given the circumstances of collapsed lung and the suspected but unconfirmed existence of bleb. [15] Dr. Adams, as Hurd’s attending physician, was adamant that travel was not possibility. His report is dated April 10, 1998: It was medically necessary to perform the surgery in Chicago since Mr. Hurd was firstly symptomatic with pleuritic chest pain and dyspnea on exertion and secondly, at risk of developing tension pneumothorax if subjected to air transportation or pneumothorax becoming larger due to the delay of prolonged ground transportation back home to Canada. Delaying surgery until the patient returned back to Canada could place Mr. Hurd’s life in jeopardy and not be standard of care for treatment of recurrent pneumothorax. [16] have reviewed the medical evidence filed by MSI expressing views contrary to those of Dr. Adams. accept the evidence of Dr. Adams as definitive. do so because he was the attending physician who examined Hurd during his illness. conclude from his report that the surgery was necessary and that it was necessarily performed in Chicago at the time in question. [17] turn then to discussion as to whether the terms of insurance exempted MSI from payment because Hurd could have returned to Saskatchewan. [18] Section IV of the policy is entitled Terms and Conditions and the portion thereof relied upon by MSI in support of one of its reasons for non-payment reads: BLUE CROSS, in consultation with the attending physician, reserves the right to return the patient to Saskatchewan. If any covered person chooses not to return and is, on medical evidence, able to return to Canada following the diagnosis of or the emergency treatment for medical condition which requires continuing medical services or surgery performed outside of Canada, the expense will not be covered by this Policy. Coverage under this Policy will cease and refund of the unused portion of the coverage will be available on request. [19] It is the position of MSI that this clause must be read in conjunction with the following clause set out in Section of the policy under the heading Exclusions and Limitations: The following services are expressly excluded from coverage under this Policy: (Applicable to all sections of this Policy). Any treatment or surgery not required for the immediate relief of acute pain and suffering, or treatment or surgery which could reasonably have been delayed until the Subscriber returned to Saskatchewan, or any treatment or surgery which the Insured elects to have rendered or performed outside of Saskatchewan following emergency treatment or diagnosis outside of Saskatchewan, unless the medical condition reasonably prevented the Insured from returning to Saskatchewan prior to such treatment or surgery. [20] Accepting as I do the evidence of Dr. Adams that travel was dangerous and put Hurd’s life in jeopardy, I find that Hurd was unable to return to Saskatchewan for surgery. conclude therefore that neither of the quoted terms can be construed to relieve MSI of its obligation to pay. [21] turn now to discuss whether the terms of insurance exempt MSI from payment because of condition pre-existing the effective date of the policy. [22] The relevant portions of the policy appear in Section V: The following services are expressly excluded from coverage under this Policy: (Applicable to all sections of this Policy). Services required as result of pre-existing condition. pre-existing condition is any condition which licensed physician was consulted or for which treatment or medication was received prior to the effective date of this insurance. [23] The question must decide is whether the exclusionary clause relied upon by MSI exempted it from liability for payment of Hurd’s claim. Setting aside for the moment the question of the “effective date” of the policy, ask myself whether there is clear evidence of “pre-existing condition” to bring Hurd within the operation of the exclusionary clause. [24] On the medical evidence of this case, two qualified physicians, Dr. Lavoie and Dr. Kanthan, both licensed as the clause under consideration requires, treated Hurd for pneumothorax and sent him on his way to Chicago to continue his studies. Neither doctor detected or made mention that they even suspected bleb as the underlying cause of Hurd’s condition. After restoring the collapsed lung Dr. Kanthan specifically reported that follow-up was not necessary. [25] In February 1998 however, after his initial examination of Hurd, Dr. Adams explained to him, as is reported in paras. 11 and 12 of Hurd’s affidavit, that the previous pneumothorax which was thought to have resulted from the skiing mishap was actually the symptom of an underlying condition, condition which remained undiscovered until there was recurrence. Dr. Adams then went on to express his belief, which he thought surgery would confirm, that the bleb could have existed from birth. In fact subsequent surgery confirmed the diagnosis. [26] The question therefore is whether the drafter of the policy intended as pre-existing condition which two physicians did not detect, and did not treat, or prescribe medication for; condition which Dr. Adams said could not be diagnosed until there was recurrence. rely for guidance on the judgment of Trainor J. in Hoult Estate v. First Canadian Insurance Corp. (1994), 25 C.C.L.I. (2d) 255 at pp. 259-60: In Privest Properties Ltd. v. Foundation Co. of Canada, Vancouver Registry C884875, 28 June 1991 [reported at 1991 CanLII 2346 (BC SC), C.C.L.I. (2d) 23 (S.C.)], Drost J. referred with approval to Couch on Insurance and said at p. 19 [p. 38, C.C.L.I.], It has been said that the general principles of insurance policy interpretation are 1. the objective in construing the policies’ coverage of liability must be to give effect to the policies’ dominant purpose of indemnity; 2. ambiguity in an insurance contract must be construed in favour of the insured; 3. the court should ordinarily strive to give effect to the objectively reasonable expectations of the insured. [27] I conclude therefore that the definition of a “pre-existing condition” is not clear and does not operate to relieve MSI of its obligation under the policy to extend to Hurd the benefits for which he sues in this action. [28] The final consideration concerns the “effective date” of the policy referred to in the exclusionary clause. As said in opening, the policy under review was in effect from August 1, 1997 to July 31, 1998. The strongest and clearest evidence of this is provided in letter dated August 26, 1997 by Colin Wrishko, MSI’s director, to Hurd’s mother in response to her request for confirmation of the period of time through which her son would have medical coverage while out of the province. This letter was written after Hurd experienced the pneumothorax and, perhaps more importantly after Wrishko was informed about it. If, as Wrishko now claims, Hurd was excluded from coverage because of the August experience, he did not raise it as an issue. attach no significance to what he now says. [29] In summary conclude that MSI insured Hurd for medical services required by him while outside the province of Saskatchewan for the period from August 1, 1997 to July 31, 1998. find that during that period of time, in February 1998, Hurd required medical attention and surgery, necessarily performed in Chicago, for condition undetected earlier by qualified medical personnel and therefore not pre-existing condition as that term is defined in the policy. [30] The plaintiff will therefore have judgment for the sum of $26,864.46 prayed for in this action together with costs to be taxed.
The plaintiff purchased a medical insurance policy from MSI for the time he expected to reside in the USA pursuing studies. The policy did not cover the periods he would be in Saskatchewan where he ordinarily resided with his parents. The plaintiff suffered chest pain following a water-skiing accident in August 1997 in Saskatchewan and underwent a thoracostomy for a collapsed lung while in Saskatchewan. He underwent a further thoracotomy in February 1998 while in the USA. MSI denied coverage arguing the plaintiff should have postponed the operation and returned to Saskatchewan for the surgery and that, in any event, the condition pre-existed the purchase of the insurance policy. The medical reports agreed that surgery was necessary. They also agreed it could be postponed for a time but there was disagreement over the length of any postponement or the patient's ability to travel home given the circumstance of a collapsed lung and the suspected but unconfirmed existence of a bleb. HELD: The plaintiff was awarded $26,864.46 plus costs, to be taxed. 1)The evidence that travel was dangerous and put the plaintiff's life in jeopardy was accepted. Therefore the plaintiff was unable to return to Saskatchewan for the surgery. 2)The exclusionary clause did not exempt MSI from liability for payment. The definition of a 'pre-existing condition' is not clear and does not operate to relieve MSI of its obligation under the policy to extend the benefits in question. The policy was in effect from August 1, 1997 to July 31, 1998. It was not raised in a letter confirming the dates of his coverage sent after the plaintiff had experienced the pneumothorax of which MSI had been informed.