ACCIDENT BENEFITS NEWSLETTER - MAY 2004

Catherine Zingg

In Ritchie and Economical Mutual Insurance Company, A02-001753, March 24, 2004, Arbitrator Sampliner held that the applicant was not entitled to any medical and rehabilitation expenses under s. 6 after January 25, 2003. Ms. Ritchie, at the age of 14, had been struck by a pick-up truck as she crossed the street in front of her family’s home on January 25, 1993. At the hearing, counsel for Ms. Ritchie argued that the consumer protection policy aim advocated by the Supreme Court of Canada in Smith v. Co-Operators General Insurance Company supports a broad and liberal interpretation favouring her view for continued insurance funding of necessary services (p.4). Arbitrator Sampliner, however, found that the Smith decision should not be construed to extend the clear coverage (p.4). In a decision called Hope v. Canadian General Insurance (2002), O.J. 1643, the Court of Appeal found subsection 6(3) a clear and unambiguous time limit to coverage, but left the door open for post-limit claims that are “resulting from the accident within the benefit period”, if:

The treatment or service is properly characterized as a single treatment or service which by its nature has to be delivered in stages over a period of time (eg., the fitting of an artificial limb), and not as a series of treatments. It would seem arguable that the entire expense for that process resulted when the treatment or service began (p.4).

In Brown and Pilot Insurance Company, A02-001364, April 21, 2004, Arbitrator Leitch held that the applicant was not entitled to an Order requiring Pilot to pay for physiotherapy treatments; a scooter accessible van and interest on these amounts. Ms. Brown was injured in a head-on collision in January 1999. She was 45 years old at the time and had suffered from neck and shoulder pain and migraines for many years. In 1996, she had applied for long-term disability benefits and in 1997 she had applied for disability pension from the Canada Pension Plan. In the accident, Ms. Brown’s head struck and cracked the windshield and she suffered lacerations. She also complained of pain in the chest, left shoulder, clavicles, neck, rib and pelvis. However, she was discharged from the hospital after x-rays showed no fractures or other abnormalities except for some degenerative spurring in her cervical spine.

Arbitrator Leitch found that the evidence did not establish that the accident of January 3, 1999 caused or contributed in a material way to the impairments for which Ms. Brown may have required the physiotherapy treatment and adjustable bed recommended. He found that only a diagnosis of post-traumatic/concussion syndrome had the potential to establish a causal link between the accident and Ms. Brown’s alleged need for the treatment recommended by Ms. Burt. (Apparently of Central Park Physiotherapy Centre) Arbitrator Leitch commented:

... this potential arises from evidence before me which could, arguably, support three findings. First, that dizziness is a recognized symptom of a posttraumatic/ concussion syndrome. Second, that Ms. Brown complained of dizziness after the accident and, third, that Ms. Brown’s complaints of dizziness dictated the need and the nature of the treatment recommend by Ms. Burt.

Still, these findings alone would not be sufficient to establish the required causal link; they would need to be accompanied by a prior foundation finding that Ms. Brown did indeed sustain a post-traumatic/concussion syndrome as a result of the accident. I am not prepared to make this foundational finding for two reasons (p.16).

Arbitrator Leitch did not accept the opinion of Dr. Weber, a neurologist who supported Ms. Brown’s claim. He found that Dr. Weber’s opinion was based, at least in part, on the factual assumption that Ms. Brown had been suffering from migraine headaches since the early 1980s (p.17). The records in fact indicated that the headaches were insufficiently detailed to determine whether they were migraines(p.17). Secondly, Arbitrator Leitch noted that Dr. Weber’s opinion was not shared by any of the other neurologists whose reports were produced (p.17).

Scooter Accessible Van

Sue Wilkinson, Ms. Brown’s occupational therapist, had prepared a treatment plan seeking reimbursement from Pilot for the cost of leasing a van, which she stated was required “in order to transport the scooter to various locations” (p.25). The estimated total cost to Pilot was $35,097.63. The treatment plan was also signed by Ms. Brown’s new family doctor, Dr. Kevin Corless. Arbitrator Leitch found that the claim for a scooter accessible vehicle should be dealt with under s. 15 of the Schedule not under s. 14. He found that dealing with it under s. 14 would require defining a motor vehicle as a “mobility device” or an “assistive device” within the meaning of s. 14(2)(f). As s. 14(2)(h) requires that all goods and services recognized under s. 14 be “of a medical nature”, the motor vehicle would have to fit that description too. Arbitrator Leitch found that sections 15(2) and 15(5)(j), which specifically refer to the purchase of vehicles, were the applicable sections. In rejecting the claim, he stated:

However, the question posed by s. 15(5)(j) is not why Ms. Brown and her husband sold or gave away their previous vehicles or why they acquired their “existing vehicle”. The question posed by that section is simply whether they had an “existing vehicle”. In my opinion, the word “existing” should be interpreted as referring to the date on which the treatment plan was received by Pilot. This must be the relevant date because it is only by comparing the then current cost of modifying an existing vehicle to the then current cost of purchasing a new vehicle (minus the then current value of any trade-in) that Pilot could have determined how to respond to the treatment plan. In this case, for example, Ms. Brown’s evidence did not exclude the possibility that she and her husband still had the 1979 truck when they leased the van. If so, and if a scooter accessible van was indeed reasonably required at that time, Pilot should have had the opportunity to determine the capacity of the 1979 truck, the then “existing vehicle”, to carry a scooter, the cost of modifications to that truck, if any were required, and the trade-in value of the truck, if a new vehicle was required. In short, even if I assume that Ms. Brown was attempting to exercise her rights under s. 15(5)(j), the evidence before me does not exclude the possibility that her unilateral course of action deprived Pilot of its right under the same section (p.29).

Two recent appeal decisions have considered what constitutes a material misrepresentation under s. 48 and the remedies available to an insurer in such situations. In Szabo and CAA Insurance Company, P03-00015, March 31, 2004, the applicant had falsely stated that he was unemployed before the accident, although he was, in fact, employed. CAA did not pay him any weekly benefits, although it investigated his entitlement to non-earner benefits. An arbitrator held that Mr. Szabo was precluded from receiving income replacement benefits because he wilfully misrepresented material facts with respect to his application for benefits. Mr. Szabo appealed the decision and argued that his subsequent application for income replacement benefits should be considered a separate application. Given that he had told the truth on a second application, he argued that he should not be prevented from receiving income replacement benefits. Director’s Delegate Makepeace rejected the appellant’s argument and upheld the Arbitrator’s Order, finding that because Mr. Szabo had wilfully misrepresented material facts with respect to his application for benefits, he was precluded from receiving income replacement benefits. In making this finding, she stated:

In a claim for accident benefits, I agree with the Arbitrator that ‘employment status is fundamental in an application for weekly benefits’ because it ‘determines the eligibility criteria, the amounts, and the commencement and termination dates for these benefits’. Further, in adjusting the claim based on Mr. Szabo’s misrepresentation about his employment status, CAA incurred a number of expenses. These included, at least, the out-of-pocket expenses of an occupational therapy assessment and multi-disciplinary insurer examination, and the administrative cost of obtaining and reviewing the application forms and statutory declaration. These costs were likely significant, and they were thrown away on a groundless NEB claim. For these reasons, I have no hesitation in concluding that Mr. Szabo’s misrepresentation was material to his NEB claim, and CAA need not establish that benefits were overpaid as a result (p.10).

In ING Insurance Company of Canada and Fisk, P03-000028, April 21, 2004, the insured had failed to disclose that he was employed for a six week period post-accident. While receiving $2,400.00 from ING in income replacement benefits, he earned $3,700.00 from Dorsey Contracting. The arbitrator had held that Mr. Fisk’s deliberate failure to disclose his post-accident employment did not preclude him from receiving weekly benefits because the misrepresentation was not material. Director’s Delegate Makepeace found that while another arbitrator might have concluded that Mr. Fisk’s was not the sort of trivial omission or quickly corrected misrepresentation that may fall below the notice of s. 48 on de minimis grounds, the conclusion was within the Arbitrator’s authority, and Director’s Delegate Makepeace was not persuaded that she should interfere. It was acknowledged that a finding on materiality depends heavily on the Arbitrator’s assessment of the evidence (p.11).