Taylor and Pembridge Insurance. Arbitration, 2014-06-11, Reg 403/96. FSCO 4218.
The Applicant was injured in a motor vehicle accident on September 10, 2009. She applied for and received statutory accident benefits from Pembridge Insurance Company of Canada (“Pembridge”), payable under the Schedule.
The Applicant exhausted medical and rehabilitation benefits under her policy. She then “applied to Pembridge Insurance for a determination that she sustained a catastrophic impairment (“CAT”)” and was denied.
“Did the Applicant sustain a catastrophic impairment as a result of the accident as defined in clauses 2(1.2)(f) and (g) of the Schedule?”
“The Schedule defines “impairment” as a loss or abnormality of a psychological, physiological or anatomical structure or function.”
“Under clause 2(1.2)(f) of the Schedule, a catastrophic impairment is an impairment or combination of impairments that, in accordance with the Guides, results in 55 percent or more impairment of the whole person (WPI).”
Under clause 2(1.2)(g) of the Schedule a catastrophic impairment is an impairment that, in accordance with the Guides, results in a class 4 impairment (marked impairment) or class 5 impairment (extreme impairment) due to a mental or behavioural disorder.”
“The Applicant did not sustain a catastrophic impairment as a result of the accident as defined in clauses 2(1.2)(f) and (g) of the Schedule.”
“I find that Ms. Taylor did not sustain a catastrophic impairment as a result of the accident as defined in clauses 2(1.2)(f) and (g) of the Schedule because she does not meet the 55% WPI threshold.”
The significance of this decision lies in the arbitrator being given the ultimate power to rule as a trier of fact and trier of law in coming to a decision regarding the future income of a person with perceived catastrophic injuries.
While the medical experts are called for both sides to establish the level of the Applicant’s permanent injuries, the arbitrator is left to make the decision of which expert opinion he or she will accept. In this case, the arbitrator chose a combination of the expert’s opinions to come to a decision.
The applicant, Mr. Isaak Awuau was involved in a motor vehicle accident on July 19, 2009. He sustained injuries and submitted a claim to his insurers, Intact Insurance Company (Intact).
A dispute arose between the applicant and Intact concerning his entitlement benefits and Mr. Awuau applied for arbitration at the Financial Services Commission of Ontario (the Commission).
Neither Mr. Awuau nor his representative showed up at the prehearing discussion on March 4, 2014. Arbitration was scheduled for May 9, 2014 at 10 a.m. with the understanding that if the applicant showed up, the matter would be treated as pre-hearing. Again, Mr. Awuau and or his representative failed to show up on this date. A letter dated March 6, 2014 was mailed to him at his last known address advising that under certain rules of the Dispute Resolution Practice Code (the Code) a hearing may be dismissed if the proceeding is deemed to be frivolous, vexatious or commenced in bad faith.
Counsel for Intact moved that the applicant’s Application for Arbitration be dismissed.
The Arbitrator dismissed the Application accordingly. Intact was awarded cost in the amount of $850 payable forthwith.
Rule 68 of the Code provides grounds on which the Adjudicator acted correctly in dismissing the Applicant’s case. Section 68.1 provides that the hearing may be dismissed if the proceeding is deemed to be frivolous, vexatious or commenced in bad faith. Mr. Awuau’s failure to turn up at the hearings may be construed as an application that was brought frivolously before the Commission or commenced as a result of vexation or in bad faith. His failure to proceed with the matter did not put him in good standing.
Section 68.2 requires the adjudicator “to deliver written notice to all parties of the intention to dismiss the proceeding on the grounds set out in Rule 68.1.” Mr. Awuau was served the requisite notices including a motion record on by Intact by regular mail on April 16, 2014 advising of its intention have the matter dismissed.
Mr. Awuau failed his obligations under subsection 3 (a) and (b) to “provide the grounds upon which the party objects to the dismissal of the proceeding, or set out any other issues or concerns, in writing; and serve the material upon the other parties and file it within 20 days of the date of the notice provided under Rule 68.2.
Donnahoque (Donald) Palmer v State Farm Mutual Automobile Insurance Company
- Donald Palmer was injured in a motor vehicle accident on November 1, 1997. He applied to receive statutory accident benefits from State Farm Mutual Automobile Insurance Company (“State Farm”). The Applicant’s claims included: psychological treatment, nerve block injections and cost of a vocational assessment. At the pre-hearing the Applicant also added botox injections and massage treatment to the benefits list. State farm denied these treatments and the issued were brought forth to the arbitration.
- Before the hearing the parties settled the psychological treatments and vocational assessment issues. The Applicant felt that State Farm should have paid for these services when his treating psychologist recommended them in January 2000 and was thus seeking special awards.
- Costs for nerve block injections, proposed botox injections and massage treatments as well as special awards were outstanding and sought after by the Applicant.
- Is the Applicant entitled to the cost associated with outstanding cost of nerve block injections, botox injections and massage treatments?
- Is State Farm liable to pay a special award pursuant to subsection 282(10) of the Insurance Act on the basis that it unreasonably withheld or delayed benefit payments for psychological treatment and vocational assessment?
- Are the parties entitled to their respected arbitration expenses pursuant to subsection 282(11) of the Insurance Act?
- Applicant applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8
- Subsection 282(10) of the Insurance Act deals with “special awards” sought by the Plaintiff:
282.(10) If the arbitrator finds that an insurer has unreasonably withheld or delayed payments, the arbitrator, in addition to awarding the benefits and interest to which an insured person is entitled under the No-Fault Benefits Schedule, shall award a lump sum of up to 50 per cent of the amount to which the person was entitled at the time of the award together with interest on all amounts then owing to the insured (including unpaid interest) at the rate of 2 per cent per month, compounded monthly, from the time the benefits first became payable under the Schedule.
- Based on the oral testimonies and medical testimonies of physicians State Farm was found liable and ordered to pay $1,170 (50 percent of $2,340) together with interest calculated as per subsection 282(10) of the Insurance Act
- The Applicant was, without a doubt, seriously injured in a head collision on November 1, 1997. The Applicant’s testimony was accepted, he had suffered a fractured sternum and left shoulder and an injury to his left knee, chronic pain in various parts of his body (particularly head, neck, chest, left arm and knee, upper back).
- Nerve block injections were administered to address particularly his head, neck and shoulder pain. Botox injections and massage were recommended for pain in the same areas.
- The Plaintiff had to deal with psychological problems which resulted in secondary anxiety and depression.
- State Farm was ordered to pay $800 fee for the five sessions of nerve block injections with interest.
- The Applicant was not entitled to the cost of either botox or massage treatments.
- State Farm was liable to pay a special award of $1,170 together with interest calculated pursuant to subsection 282(10) of the Insurance Act.
- The significance of the Insurance Act subsection 282(10) allows for those seeking benefits from the Auto Insurance Company to be protected from harm caused by the delay or withhold of payment. When further harm is caused special benefits are awarded in addition to the original ones issued.
Ms. Stacey Taylor was injured in a motor accident in on September 10, 2009. After the accident, she applied for statutory accident benefits from Pembridge Insurance Company of Canada, and she received this benefits, but after she exhausted all the medical and rehabilitation benefits available under her automobile insurance policy she applied for a determination that she sustained a catastrophic impairment. The insurance company denied her application and considered that she did not suffer a catastrophic impairment as a result of this accident.
The issue is whether or not, the Applicant, Stacey Taylor, sustain a catastrophic impairment as a result of the accident as defined in clauses 2(1.2)(f) and (g) of the Ontario Statutory Accident Benefits Schedule (SABS).
- Ms. Taylor testified that at the time of the accident she was working for Parks Canada as an archaeologist and that her job involved looking for sites, hiking, clearing trails, clearing areas for infrastructure, artifact analysis, report writing, and site reports. She described how was her life before the accident, and how much her day to day life was change since the accident, and how the accident affect her abilities to work and to develop a normal family life with her common law partner due to the rehabilitation process, the continuous pain, and the psychological consequences of the accident, as anxiety, difficulty to sleep and short-term memory issues which causes a lot of frustration and depression on her. The Arbitrator accepted all this declaration.
- In this case, the expert opinions are important to determine if there is an actual catastrophic impairment, due to that, the Commission received the opinion from various Doctors who treated and evaluated Ms. Taylor.
- The arbitrator remark that the burden of proof rests with Ms. Taylor, and that she must prove on the balance of probabilities that, as a result of the accident, she sustained a catastrophic impairment.
- The arbitrator also stated that the determination of catastrophic impairment is ultimately an adjudicative, not a medical determination and that the role of the assessor is to provide a clinical opinion as to the level of an individual’s impairment.
- The decision maker use the expert opinion of Dr. Harold Becker, who is a medical doctor and the Medical Director of Omega Medical Associates. He was qualified as an expert in the use of the AMA Guides to the Evaluation of Permanent Impairment. Dr. Harold Becker testified as to the use of the Guides and his combination of the impairment ratings in Ms. Taylor`s case. He provided evidence as to the proper method of determining and scoring particular impairments as part of the process of establishing impairment ratings. He oversaw the work of Dr. Lisa Becker and Dr. Jeremy Frank. He concluded that when physical impairments and mental and behavioural impairments are combined, Ms. Taylor rated 31-60% Whole Person Impairment (“WPI”).
- This means that this range has a dual meaning, one part of the range (37 to 54% WPI) means that Ms. Taylor does not meet the catastrophic threshold for physical impairments, and the other part (55 to 62% WPI), means that Ms. Taylor meets or exceeds the catastrophic threshold.
- For the arbitrator there is not a final answer about if Ms. Taylor meet the 55% WPI threshold for physical impairments under the Ontario Statutory Accident Benefits Schedule and the evidence supports different findings on this critical issue, and it is evenly weighted. In the absence of any other evidence, the arbitrator considered that the issue must be determined in a manner that favours Pembridge.
- When the physical impairment rating of 26% is combined with the mental and behavioural impairment rating of 11%, this results in a WPI of 34%. 34%, rounded to the nearest value ending in 0 or 5, as permitted by the Guides, yields 35%, which is insufficient to meet the criteria of the Ontario Statutory Accident Benefits Schedule.
Based on the evidence, the arbitrator conclude that Ms. Taylor did not sustain a catastrophic impairment as a result of the accident as defined in clauses 2(1.2)(f) and (g) of the Ontario Statutory Accident Benefits Schedule.
Catastrophic impairment is a “hot topic”, to say the less, in the field of the accidents benefits and insurance companies. But, why is so important? Why is so polemic? We can resume to one main point, the money involve.
When a person is seeking to receive a benefit from an insurance company, being classified under the category of “catastrophic impairment” could represent a big difference in the amount of money that the person can receive from the insurance company.
Where we can find the definition of catastrophic impairment?
In Ontario, the Statutory Accident Benefits Schedule (SABS), define in his clauses 2(1.2)(f) and (g) what we can consider as a catastrophic impairment. Basically, the law define it as follow:
For the purposes of this Regulation, a catastrophic impairment caused by an accident is,
- paraplegia or quadriplegia;
- the amputation or other impairment causing the total and permanent loss of use of an arm or a leg;
- the total loss of vision in both eyes;
- subject to subsection (4), brain impairment that, in respect of an accident, results in,
- a score of 9 or less on the Glasgow Coma Scale as published in Jennett, B. and Teasdale, G.,Management of Head Injuries, Contemporary Neurology Series, Volume 20, F.A. Davis Company, Philadelphia, 1981, according to a test administered within a reasonable period of time after the accident by a person trained for that purpose, or
- a score of 2 (vegetative) or 3 (severe disability) on the Glasgow Outcome Scale, as published in Jennett, B. and Bond, M., Assessment of Outcome After Severe Brain Damage, Lancet i:480, 1975, according to a test administered more than six months after the accident by a person trained for that purpose;
- subject to subsections (4), (5) and (6), an impairment or combination of impairments that, in accordance with the American Medical Association’s Guides to the Evaluation of Permanent Impairment, 4th edition, 1993, results in 55 per cent or more impairment of the whole person; or
- subject to subsections (4), (5) and (6), an impairment that, in accordance with the American Medical Association’s Guides to the Evaluation of Permanent Impairment, 4th edition, 1993, results in a class 4 impairment (marked impairment) or class 5 impairment (extreme impairment) due to mental or behavioral disorder.
What about case law?
Being a main issue in the field of the accident benefits, is reasonable that exists a lot of case law related with what we can consider and we cannot consider as catastrophic impairment. We can mentioned two recent important cases related with the catastrophic impairment definition
- Aviva and Pastore (2012 ONCA 642) : in this case, the Ontario Court of Appeal stated that is enough be markedly impaired in one of the four of her activities of daily living , social functioning, concentration and deterioration on the job, to the person be considered under the category of catastrophic impair and ask for a higher compensation.
- Kusnierz v. The Economical Mutual Insurance (2010 ONSC 5749): in this case,Ontario Court of Appeal found that is possible combine psychological and physical impairments to reach the “minimum” percentage required to be consider as a case of catastrophic impairment.
What is new?
Recently, on June 12, 2012, the Ministry of Finance released the Superintendent’s Report on the Definition of Catastrophic Impairment in the Statutory Accident Benefits Schedule, which is the new project related with catastrophic impairment, the purpose is to ensure that the most seriously injured accident victims are treated fairly.
The government directed consult with the medical community to amend the definition of catastrophic impairment as set out in the Statutory Accident Benefits Schedule, and to set out which need to be the qualifications and general requirements for health professionals who conduct catastrophic impairment evaluations.
What is next?
The definition of catastrophic impairment still will be a hot topic in the near future because involves economic issues and have a great impact in the insurance companies, who pressure the Ontario government to define and clarify the extent and limits of this concept, because certainty about this is important to both sides, companies and insured people. Is just a matter of time to see what direction is going to take this definition and how is going to impact the insurance industry.
For the reported decision in its entirety please consult Lenworth Scarlett v. Belair Insurance Company Inc.
The applicant Mr. Lenworth Scarlett was injured in an automobile accident, and applied for accident benefits under the Statutory Accident Benefits Schedule. It was determined that because Mr. Scarlett’s injuries are classified outside the Minor Injury Guideline, he is eligible to receive accident benefits in excess of the $3500 limit set out in the guideline.
Review of Facts
- Mr. Scarlett was a passenger in a vehicle insured by Belair that was rear ended by another vehicle on September 10, 2010. As a result of the injuries he experienced, he applied for accident benefits.
- At the time of the accident, Mr. Scarlett was new to Ontario and consequently was not covered under OHIP or any other medical plan.
- Mr. Scarlett brought forth evidence from health practitioners that outlined the extent of his injuries, which suggested that the totality of them falls outside of the Minor Injury Guideline. According to the experts, he was suffering from mental health issues such as depression, anxiety and post-traumatic stress disorder as well as physical health conditions such as chronic pain and Temporal Madibular Joint Syndrome (TMJ).
- Belair sought out the opinion of experts who concluded that he suffered soft tissue injuries with no indication that they fall outside the scope of the minor injury guideline. And also concluded that based on his narrative Mr. Scarlett does not meet the criteria for any formal psychological diagnosis.
The issue to be determined in this case is whether or not the complainant Mr. Scarlett is able to recover accident benefits in excess of the $3500 limit set out in the Minor Injury Guideline.
To reach a decision, arbitrator John Wilson looked to the policy objectives and language used in the guideline and related law to determine if Mr. Scarlett’s injuries fall under the classification of the Minor Injury Guideline. It was first decided that the guideline though incorporated into SABS is non-binding and serves only as aid to help with interpreting the schedule. Subsequently the purpose of the superior legislation (The Insurance Act and SABS) was examined to ensure that the interpretation of the guideline was consistent with the intentions of the legislation. It was concluded that the guideline was to be interpreted at face value and in conjunction with the purposes that it specifically outlines. Because of this, the burden of proof was found to rest on the insurer to provide evidence on the balance of probabilities as to why there should be a limitation of coverage.
Based on the compelling evidence offered by the complainant through credible medical reports, and the single medical report lead by Belair, it was determined that Belair did not meet their burden in providing evidence that suggested the claim should be limited to the Minor Injury Guideline. Mr. Wilson accepted the evidence that Mr. Scarlett suffered from TMJ, chronic pain and psychological impairments, which he found to be separate, distinct and outside of the Minor Injury classification. Therefore Mr. Scarlett is able to recover accident benefits beyond the $3500 dollar limit set out in the Minor Injury Guideline.
In the past many individuals have tried to dispute the Minor Injury Classification unsuccessfully. This is a precedent setting case because it marks the first time a decision has been made regarding accident benefits and the Minor Injury Guideline. It changes the future of legal claims regarding this area, because they will now be evaluated on an case by case basis because there may be other injuries or pre-existing conditions that can influence the classification.
Unknown to many, provincial legislation exists which allows individuals to make claims for injuries sustained during an automobile accident, regardless of which party is held liable. Under Ontario’s Insurance Act, regulation 34/10 The Statutory Accident Benefits Schedule (SABS), outlines the various benefits that one may be eligible to receive.
Who is Eligible?
The individual who was injured along with dependants and close relatives in certain circumstances, are eligible to receive accident benefits. However, individuals who acted in violation of the law will not be eligible for such benefits. This includes but is not limited to driving without a valid license or insurance policy, using the automobile for criminal activity and driving while impaired.
Types of Benefits
Here is a list of the various types of benefits one may be eligible to receive under SABS. Please note that while individuals may be eligible for more then one type of benefit, only one type can be claimed.
Income Replacement Benefits – will partly compensate individuals for lost income because of the injuries sustained in the automobile accident. Individuals can receive up to 70% of their gross income at the time of the collision, with a maximum of no more than $400 per week for 104 weeks.
Non-Earner Benefits – For individuals who are unable to live a normal life as a result of the accident, and do not fall under those eligible to receive income replacement benefits. Individuals must be at least 16 years of age, and a full time student at the time, or had previously finished school within the last year but hadn’t found employment in their field. Individuals will be entitled to receive up to $185 weekly for 104 weeks. After 104 weeks, the amount increases to $320 weekly if still eligible.
Caregiver Benefit – For individuals who are unable to carry out their caregiver role (taking care of dependants) because of injuries incurred during the accident. Individuals must, be living with the dependant at the time, be the primary caregiver, and receive no payment for the care they provide. Can receive $250 weekly for up to 104 weeks for the first dependant, and any additional dependent is an added $50 weekly.
Medical and Rehabilitation Benefits- Reimburse individuals for expenses incurred as a result of the injuries one sustained in a motor vehicle accident, that aren’t otherwise covered in an alternate health plan (such as OHIP). Amounts awarded vary depending on the severity of injuries.
Attendant Care Benefits- To compensate those who are no longer able to care for themselves and therefore must seek out the services of another.
Death and Funeral Payments Benefit- The death benefit is a lump sum given to those individuals who have lost a spouse, dependent or caregiver. Funeral Payments Benefits will provide individuals with a reimbursement for funeral costs.
Other Expense Benefits – Beyond those mentioned above, individuals might be eligible to receive benefits for lost education, home maintenance/housekeeping, visitor benefits amongst others.
How to Apply?
Individuals must first report injuries incurred during the accident separately from any claims for damage to property. Insurance companies must be notified that you wish to apply for accident benefits within 7 days of the accident. Once notified a package from the insurance company containing various forms, is delivered to the applicant for their completion. This package must be completed and returned to the insurance company within 30 days of receiving it. Within 10 days, individuals will be notified of the insurer’s decision to award accident benefits. Decisions could include, approvals for benefits, request for more information or request for an insurer examination (Completed by a regulated health professional chosen by the insurance company for the purpose of conducting a file review or examination to get a second opinion on one’s condition).
If you are looking for further detail, this accident benefits brochure provides a great overview.
If you do wish to pursue a claim it is advised that you seek independent legal advice from a licensed paralegal or lawyer to assist you in the matter.