Neutral Citation: 1992 ONICDRG 33

File No. A-000624

ONTARIO INSURANCE COMMISSION

BETWEEN:

SURBIR SINGH GABA

Applicant

and

ALLSTATE INSURANCE COMPANY

Insurer

DECISION

Issues:

The Applicant was injured in a motor vehicle accident on December 22, 1990. He was insured under a standard automobile owner's policy issued by the Insurer. Every motor vehicle liability policy provides the no-fault benefits specified in Ontario Regulation 273/90 ("the Schedule"). The Insurer paid weekly income benefits under Part IV of the Schedule to the Applicant until May 12, 1991. Thereafter, the Insurer claimed the Applicant failed to meet the criteria of Section 12(1) of the Schedule, because he was not suffering "substantial inability to perform the essential tasks of his or her occupation or employment". The Applicant applied for mediation in November 1991. Mediation was unsuccessful in resolving the issues in dispute between the parties and the Applicant subsequently applied for arbitration.

The issues to be determined in this arbitration are as follows:

1. Is the Applicant entitled to weekly income benefits from May 13, 1991 forward?

2. What is the correct amount of weekly income benefits which should be paid to the Applicant in the future and should have been paid to him in the past?

3. Is there any overpayment of weekly income benefits by the Insurer in respect of this Applicant?

4. Is the outstanding account of $2,514.50 for a functional interdisciplinary program for the Applicant "reasonable" as required by section 6(1)(c) of the Schedule?

The Applicant also claims interest on any unpaid benefits and his expenses of the arbitration.

Result:

1. The Applicant is entitled to three further weeks of accident benefits from May 13 to June 2, 1991.

2. The correct amount of weekly income benefits is $542.17 per week.

3. There is an overpayment by the Insurer in the sum of $7,205.51, which shall be repaid by the Applicant to the Insurer.

4. The outstanding account for a functional interdisciplinary program for the Applicant is reasonable and should be paid by the Insurer. The amount outstanding is $2,514.50, less $350.00, plus G.S.T., assuming only the half day cost should have been charged for March 19 and 20, 1992.

Hearing:

An Arbitration hearing was held at North York, Ontario, on May 21, 22 and June 17, 1992, before me, K. Julaine Palmer, arbitrator.

Present at the hearing were:

Applicant: Surbir Singh Gaba

Applicant's Representatives: Fern Silverman, Audrey Douek Barristers & Solicitors

Insurer's Representative: James B. Flaherty Barrister & Solicitor

Patricia Martinolich Law Clerk

The following testified under oath or solemn affirmation:

Surbir Singh Gaba

Dr. Arthur Ameis

Dr. Swaleha Khan

Steven Flood

Heather Sloman Bradley Barber

Andy Young

The parties filed 26 exhibits.

Cases cited:

General Accident Assurance Co. of Canada v. Darlene Walker, Osborne J., S.C.O., unreported decision, November 13, 1990.

Articles cited:

Melzack, Ronald. "The Tragedy of Needless Pain", Scientific American, v. 262, n.2, February 1990, p.27

Waddell, Gordon. "A New Clinical Model for the Treatment of Low-Back Pain", Spine, v.12, n.7, 1987, p.632

Evidence:

The Applicant, a 27 year-old driving instructor, was injured in a motor vehicle accident on December 22, 1990. He was travelling alone in his vehicle on Weston Road in Metropolitan Toronto. Two cars preceding him stopped for a pedestrian in a crosswalk. The Applicant stopped his vehicle, but the car behind him hit his vehicle in the rear. There was very little damage to the Applicant's motor vehicle less than $250.00. His car moved ahead less than one meter and did not strike the car in front of him.

The Applicant was wearing his lap and shoulder belt at the time of the accident. His body did not hit anything inside the motor vehicle, but he was shaken up, so he cancelled his appointment with his next driving student and went home. That afternoon, he went to sleep, but at midnight he woke with pain in his neck and went to the emergency department of Humber Memorial Hospital. Two days later he was examined by a physician in his family doctor's office. His regular family doctor was away from her office at that time. Following her return, he was examined regularly by Dr. Khan, his family physician, who testified at the hearing.

The Applicant testified that he was self-employed as a driving instructor prior to the accident. He worked with the Young Driving School. The Applicant testified that prior to the accident he would give between six and twelve 45-minute lessons in a day and he often worked seven days a week.

The Applicant's evidence was that he had to sit for long hours in his vehicle, between eight and twelve hours in a day. He made his own schedule with a student, after the initial contact from the school office. He had to have fast reactions for steering and braking and be able to move his shoulders and whole body to demonstrate parallel parking and three-point turns to his students.

In the course of his medical treatment, the Applicant was examined by three orthopaedic specialists two of whom he was referred to by his family doctor (Dr. Sehmi and Dr. Lexier) and one of whom was engaged by the Insurer (Dr. McDonald). Dr. Sehmi and Dr. McDonald wrote reports which stated that the Applicant could return to work by the middle or end of May 1991. Dr. Swaleha Khan, the Applicant's family doctor, testified at the hearing that, on June 25, 1991, when she examined him in the office, she also advised the Applicant to return to work, beginning with two hours a day at first.

Dr. Khan further testified that when she saw her patient next on July 9, 1991, he told her that he had returned to work for two days, but the pain worsened so that he could not continue. The Applicant testified that in June 1991 he tried to return to work part-time, but after two hours he left the job and came home.

On August 21, 1991, the Applicant attended at the F.I.T. for Work Centre in Toronto. The Applicant's solicitor had requested an evaluation of Mr. Gaba by the F.I.T. Centre. The evaluation report written by an occupational therapist and a physiotherapist recommended Mr. Gaba enrol for a two-week trial in the functional restoration program of the F.I.T. for Work Centre. Dr. Khan wrote a note recommending this program for her patient on December 4, 1991. She testified she felt enrolment in the program would "bring up his confidence and strength so he can return to the work force and his normal life".

The Insurer filed reports of three examinations of the Applicant by orthopaedic specialist Dr. Glen McDonald. When Dr. McDonald had seen the Applicant initially on March 6, 1991, he felt that he was unfit at that time to do his regular work, but that after three weeks of physiotherapy, he would have sufficient improvement to be able to return to work. At the second examination by Dr. McDonald on May 6, 1991, the orthopaedic specialist felt that the Applicant should return to work on May 13, 1991, and continue with his therapy until that time. When he was reviewed on December 16, 1991, Dr. McDonald noted that the Applicant's main complaint had shifted to the low back, and there was also some complaint of discomfort in the neck and shoulders. There was evidence of some mild muscle spasm. Dr. McDonald remained of the opinion that the Applicant was capable of working and he could see no need for an extensive rehabilitation program. The only concession which Dr. McDonald made was that he felt that it would be "helpful if he was considered fit for part-time work initially, and that he might gradually rehabilitate himself in the job, increasing his hours of work from, for example, four hours of work [per day] for a month, and then gradually increasing from there to a full-day's work program".

The Insurer called an investigator as a witness. He testified that on December 17, 1991 he observed the Applicant. The investigator watched the Applicant for a period of 12 to 15 minutes at 3:00 p.m. in the afternoon and recorded approximately ten minutes of videotape. He saw the Applicant shovelling his driveway with a young man who it was learned later was the Applicant's 17 year old nephew. The videotape was shown at the hearing. The Applicant saw the videotape of this surveillance previously, in January 1992 at a mediation hearing at the Ontario Insurance Commission.

In February and March of 1992, the Applicant attended at the F.I.T. for Work Centre, for 16 half days and 6 full days. On April 28, 1992, the Applicant returned to part-time work, which he had maintained up until the day of the hearing on May 21, 1992.

Submissions:

Applicant's arguments:

The Applicant's solicitor submitted that the only expenses which should be deducted from the gross revenue of the business should be the advertising, meal, office, gas, car wash and parking expense, a total of $5,410.05, plus the agreed figure of $1,312.50 for capital cost allowance.

On the question of disability, she submitted there is no evidence that the Applicant was not disabled till at least December 16, 1991. The Applicant did attempt to return to work in July 1991 and he had to quit. The Applicant's counsel submitted that the Applicant had satisfied the onus of burden of proof that he was disabled until April 28, 1992. Thereafter, the appropriate deductions should be made for resuming part-time work, from the $600 per week benefit he should receive.

The Applicant is entitled to all reasonable expenses that are necessary and Dr. Khan has agreed the expense of F.I.T. was necessary. The F.I.T. account should be paid in full. In the General Accident Assurance Company of Canada v. Darlene Walker case, Mr. Justice Osborne stated, relating to the former Schedule C benefits,

It seems to me Schedule C establishes a no fault scheme whereby the insured [for which read insurer], in the context of this case, is required to pay "essential" rehabilitation expenses. Schedule C does not seem to me to involve the insurer's [sic] in the rehabilitation process itself.

Thus, the method and means of rehabilitation is up to the Insured and his medical adviser, not the Insurer.

Insurer's Argument:

The Insurer's solicitor submitted that the consensus of orthopaedic opinion in May 1 91 was that the Applicant could return to work, at least by the end of that month. The nature of the Applicant's occupation in and of itself was not strenuous. Dr. Khan testified that, after she saw the video, her patient's complaints were inconsistent with snow shovelling; the only basis on which she could justify her diagnosis is the subjective complaints of the Applicant.

The occupational therapist called by the Applicant admitted the activities of Mr. Gaba on the videotape were inconsistent with the "pain behaviour" described in the two F.I.T. reports.

In the literature, the seminal study by Dr. Waddell observed that,

Clinical assessment of pain and disability depends on the patient's subjective report, which is considerably influenced not only by the objective physical abnormality but also by the patient's attitudes and beliefs, psychologic distress, and illness behavior. (p. 632,634)

Once a patient reaches a physician, medical assessment and treatment is influenced more by the patient's distress and illness behavior than by the actual physical disorder. (p. 635)

This supports what the occupational therapist and family doctor met in this case.

The Insurer's solicitor submitted the entire F.I.T. program was unreasonable and should be totally repaid. There will be cases, and this is one, where the arbitrator should find as a fact that all of the expenses were not reasonably incurred. F.I.T. assessed the Applicant on August 21, 1991 at the request of his lawyer; they recommended a two week program; nothing happened. Not until February 1992 did the Applicant attend at F.I.T., with no reassessment.

On the issue of the cost of the F.I.T. program, the Insurer paid $6,420.00, including G.S.T., plus the assessment cost of $508.00. In the second F.I.T. report, it was stated the Applicant attended 16 half days and 6 full days. The insurer was billed the full day cost for March 19 and 20, 1992 instead of a half day. The difference is $350.00, assuming the F.I.T. report is correct, not the invoice.

With regard to ceasing expenses, all expenses ceased except $4,140.00 insurance, $140.00 business tax, and $1,312.50 the agreed figure for capital cost allowance. The remainder of the arithmetic is set out in Exhibit 22. The Seaboard Life policy payments should be deducted because it was an income payment of some kind.

Findings:

Issue 1 - Entitlement to Weekly Income Benefits, from May 13, 1991 forward:

In order to be entitled to weekly income benefits from May 13, 1991 forward, the Applicant must prove, on a balance of probabilities, that after May 13, 1991 he suffered "substantial inability to perform the essential tasks of his occupation or employment". This is the requirement of s. 12 of No-Fault Benefits Schedule. There is no issue that Mr. Gaba met the qualifications of employment or self-employment at the time of the accident.

What are the essential tasks of a driving instructor? There are physical demands which require him to sit for at least the time of each lesson, 45 minutes. In order to perform a full day of this employment, he must be able to sit through six or more lessons. He must be able to move his neck, shoulders and trunk to demonstrate the technique of parallel parking and three-point turns. A driving instructor also requires patience, fast reactions and an ability to concentrate and be alert.

When he was examined on May 6, 1991 by Dr. McDonald, that orthopaedic specialist reported as follows:

..."The patient tells me that while he has improved. He hasn't been able to get back to work because he has "too much pain".

The patient locates his pain to the base of the neck and spreading into the left shoulder. And, there is also some pain in the intra scapular area, and thoracic spine. He also has some pain in the low back area which seems to be located about the level of L2-3 and a little bit to the left.

The patient states that his pain is somewhat fluctuant being good some days and more disabling and severe on other days....

The patient moves about the examining room fairly freely and has only minimal evidence of pain and stiffness in his neck and lower back.

Specific examination of the neck and lower back shows a good range of motion. The range being about two-thirds of the expected normal.

The patient shows some rather diffuse tenderness in the base of the neck and to the left side.

The patient's low back examination shows only some very mild restriction of motion with pain at extremes.

X-Rays: X-rays on this patient's neck have been reviewed and they are negative.

Opinion: This patient has sustained a soft tissue sprain of his neck and lower back. He states that he is too disabled to return to work as a Driving Instructor however, on examination his level of disability does not seem great and I think that it is quite reasonable to expect him to return to his regular work on a fulltime basis next Monday the 13th of May. The patient should continue with his therapy until that time....

Dr. Khan, the Applicant's family physician, sent her patient to orthopaedic specialist, Dr. B.S. Sehmi, on two occasions. After the Applicant's office visit of January 22, 1991 when the pain seemed to be getting worse, she made the first referral. When he was first examined on March 1, 1991, Dr. Sehmi reported to Dr. Khan as follows:

On examination, he was tender in the neck and trapezius region with painful stiffness. The shoulder abductions were also painful. He had some tenderness in the upper back but the back was mobile. He was further tender in the low back with pain on forward and lateral flexions with mild painful stiffness. The SLR was 90 degrees on both sides and free. There was no gross neurological deficit. The main problem was pain in the neck.

This patient has strained his neck and back. I suggest that he gradually get rid of the collar and increase his activity. He should continue the therapy and attempt to return to work in another three to four weeks.

Dr. Khan saw the Applicant on March 11, 1991 and discussed Dr. Sehmi's opinions with him. On April 18, 1992, she referred him again to Dr. Sehmi because the Applicant reported his pain worsening.

In his second report of May 21, 1991, Dr. Sehmi wrote to Dr. Khan:

I saw this patient again on the 17th of May, 1991 and his neck was improving but then he got a flare up of the neck pains and he had to go back for physiotherapy. He is also getting some pain in the left shoulder. His low back is also painful and he cannot sit too long.

On examination, he was tender in the neck and left shoulder region and also tender in the low back. There was painful stiffness in the neck, low back and left shoulder. There was no gross neurological deficit.

I suggest that this patient increase his activity and continue the therapy and return to work in a couple of weeks. I prescribed a car seat to be used when he is driving.

The Applicant testified at the hearing that in May 1991, his neck, back and left shoulder were painful. He could not keep his neck straight and, if he did, the pain increased. If he sat for long periods of time, his back pain started to get worse. The Applicant did not return to work until late June or early July 1991. When he did, he was not able to continue, he said, because of the pain.

Based on this experience, his family doctor referred him to another orthopaedic surgeon whom he saw on August 21, 1991. Dr. Lexier, the orthopaedic surgeon, made no recommendations other than a referral to a neurologist and stated that he had no doubt that "he had mild to moderate acceleration/deceleration injuries, but this is not the current source of his symptoms" (Exhibit 3).

Dr. Lexier examined the Applicant again on January 8, 1992, by which time he had received the neurologist's report. The neurologist was reported not to feel that there was any point in investigating the involuntary muscle spasm of the Applicant's left foot. The orthopaedic surgeon indicated that he could not "account for his persistent complaints on a orthopaedic basis. The only option would be to refer him to a chronic pain clinic..." (Exhibit 10).

From the preponderance of medical evidence before me, it would appear that the Applicant ought to have returned to his employment early in June 1991. As a driving instructor, the Applicant had the ability to schedule his students to suit his tolerance. The medical evidence and the evidence of the occupational therapist suggests that the Applicant believed he should be entirely pain free when he returned to his employment. The F.I.T. report of March 31, 1992 stated "the concept of functioning with pain is not one acceptable to Mr. Gaba." That is not the standard that the Schedule imposes. To remain eligible for weekly income benefits, the Applicant must show, on a balance of probabilities, a substantial inability to perform the essential tasks of his employment. The Schedule provides protection for injured persons who attempt to return to work and cannot, thereafter, as a result of the accident, carry on (section 6). The Schedule also provides that only 80% of "part-time" earnings after the accident are to be deducted from weekly income benefits (section 15).

I do not think that the Applicant gave returning to work a fair or reasonable chance of success in 1991. In my view, by early June 1991, he had recovered the ability to perform his essential tasks. The F.I.T. assessment, two months later in August 1991, showed, on the basis of objective test results, that the Applicant was not putting forward a full and consistent effort. The Applicant's benefits were terminated May 12, 1991. I would award the Applicant three weeks further benefits to June 1, 1991 based upon the expert observations and conclusions of Dr. Sehmi and Dr. McDonald regarding the Applicant's fitness for work.

At the same time, it would appear that the Applicant did not have a family or professional support mechanism in place preparing him to accept an increased level of pain or discomfort on his initial return to work and to attempt to work through the pain. This support was ultimately provided by the F.I.T. for Work Centre in its multifaceted program, the results of which were outlined in the March 31, 1992 report, filed as an exhibit. After completing that program, the Applicant was able to feel more secure about returning to work.

Issue 2 - Functional Interdisciplinary Program:

The test to determine whether the functional interdisciplinary program should be paid is set out in section 6 of the Schedule. That section requires the Insurer to pay all reasonable expenses for rehabilitation, life-skills training, and occupational counselling and training, where a person has sustained physical, psychological or mental injury as a result of an accident. Before making a payment, under section 6(1), the insurer may require the applicant to submit "a statement signed by the insured person's qualified medical practitioner or psychological advisor, stating that the expense is necessary for the insured person's treatment or rehabilitation". An extended period of time for receiving such supplementary medical and rehabilitation benefits is contemplated by the Schedule, for up to ten years in the case of an adult.

(i) "Necessary for the Insured Person's Treatment or rehabilitation":

At the time he attended the F.I.T. program, beginning February 3, 1992, five months had passed since the initial assessment by F.I.T. It would appear that the Applicant was never re-evaluated before he began the program or after the two week trial period suggested in the August 28, 1991 report, but was started on three weeks of half-day attendances. Some formal re-assessment might have been undertaken, however, the approval of Dr. Khan for the program dates only from December 4, 1991. By January 1992, the Applicant was still not back to work of his own initiative despite medical clearance. The Applicant lacked some instruction, motivation, or support to meet the challenge of returning to his job. The support provided by the counselling and other team members at the F.I.T. centre was necessary to encourage the Applicant to return to his normal life. In this opinion, I echo the words of the Applicant's family physician, Dr. Khan. At the hearing, she testified that in December 1991 she felt the Applicant's involvement in the program would "bring up his confidence and strength so he can return to the work force and his normal life".

(ii) "Reasonable Expenses":

The question of who has the onus of proof of reasonableness was not directly addressed by either counsel. It would appear to be implicit that this task is required to be performed by the Applicant. It is my view that once a prima facie case has been made for the reasonableness of the account, the secondary onus shifts to the Insurer to disprove the reasonableness. It is not my sense of the Schedule that the legislature sought to impose a heavy accounting onus on injured persons. In this case, the reasonableness of the expense was supported by the Applicant's testimony, the testimony of the occupational therapist, the two written reports filed and as well, to some extent, in a generic sense, by a report from the Insurer's expert physiatrist, Dr. Arthur Ameis.

The Insurer submitted some rather vague oral evidence through its claims manager about the cost of attendance at other programs said to be similar to F.I.T. In my view, the Insurer failed to establish that the account of the F.I.T. for Work Centre was inflated beyond the range of reasonableness of comparable treatment at another centre. Indeed, in a report offered on behalf of the Insurer, Dr. Arthur Ameis gave the opinion that "F.I.T. is a professional organization with appropriate staff, equipment and protocols for addressing pain problems". The cost of the program was presented only in Exhibit 24, a statement dated April 30, 1992 from F.I.T., not in an invoice form. The only information on the daily cost of the program, in fact, came through the testimony of the claims manager, Mr. Barber, who could not recall with certainty the half day rate charged by F.I.T. In my view, there was no evidence before me to enable me to conclude that the F.I.T. account was unreasonable. On the contrary, the evidence of the occupational therapist, combined with the testimony of the Applicant about the program and the written assessment and report by the F.I.T. staff, all of which I accept, indicates that in this case this group provided valuable services at a cost that is within the range of charges which could be seen as reasonable.

Accordingly, I find that the Insurer should pay for the F.I.T. program for the Applicant. In so finding, I stress that the tests of eligibility under s. 6 and s. 12 of the Schedule are completely different. There may well be occasions when insured persons will be entitled to supplementary medical and rehabilitation benefits, although they are not substantially unable to perform the essential tasks of their employment and thereby qualify for weekly income benefits.

It is my view that, where such questions of rehabilitation arise, insurers and injured persons should work co-operatively to achieve a consensus as to the appropriate rehabilitation, occupational counselling and training program that an injured person should pursue. Automobile insurers in this province have developed expertise in evaluating the great number of such programs offered by different health care professionals. The family physician, orthopaedic specialist, other health professionals, solicitor, injured person and insurer, all working together, should be able to achieve the goal of rehabilitating the injured person to a pre-accident level of function. In cases where an injured person continues to complain of pain, although independent orthopaedic surgeons cannot find objective signs of impairment, the insurer should be among the first to assist its insured to pursue psychological, rehabilitative or occupational counselling.

Issue 3 - Correct Amount of Weekly Income Benefits:

The Applicant was self-employed as a driving instructor for Young's Driving School. Section 12(7)3. of the Schedule requires that "business expenses which cease as a result of the accident shall be deducted from a person's income from self-employment before calculating his or her gross weekly income". It was established at the hearing that the $90.00 included as an advertising and promotion expense in the Applicant's 1990 tax return had nothing whatsoever to do with the Applicant's driving instructing business, but was with respect to advertising a rental property. His licensing and business tax fees continued following the accident. There must be a deduction made for insurance costs, because the Applicant stated that approximately three months after the accident, he ceased paying insurance. As well, his annual premium for the 1991 year was $2,292.78 with this insurer, a saving from the $4,140.00 paid previously to another carrier. Maintenance and repair expense also ceased after the accident.

Meals and entertainment expense of $512.00 ceased, as well as office expenses of $187.05. Total gas expenses of $3,685.00 must be deducted as must almost the entire expenditure for the car telephone. The Applicant paid $12.00 per month to keep the telephone number and service in place and $50.00 annually for the license. He testified he kept the service for approximately four to five months after the accident. Now, his calls are forwarded to his home.

The car wash expense of $750.00 ceased after the accident as well as the parking expense of $186.00. The parties agreed that one half of the capital cost allowance claimed, that is $2,625.00 divided by two, or $1,312.50 would be an appropriate figure for capital cost allowance after the accident.

In the result, then, $11,259.00 in ceasing expenses should be deducted from the $46,500.00 gross revenue for 1990, leaving a recalculated gross income of $35,241.00.

When $35,241.00 is divided by 52 to give a gross weekly income, the figure $677.71 results. Eighty per cent of this sum is $542.17 and that is, accordingly, the amount which should have been paid to the Applicant while he was entitled to weekly income benefits. A detailed calculation is set out in Appendix 1 of this decision.

The Insurer also claimed credit against its payment for amounts received by the Applicant from Mutual of Omaha Insurance Company ($7,133.33 for January 26 to May 13, 1991 - 15 weeks -average per week $475.55), pursuant to the provisions of section 12(4)(b) of the Schedule as a "payment for loss of income...under any income continuation benefit plan".

The Insurer paid 20 weeks x $600 per week or $12,000.00 in total to the Applicant, but was only obligated to pay $542.17 per week for the first four weeks from December 29, 1990, then $66.62 per week during the 15 weeks the applicant received benefits under the Mutual of Omaha policy. This would have amounted to a total payment by Allstate of $3,167.92 instead of $12,000.00. There is, thus, a gross overpayment of $8,832.02 (less the set off of three weeks of additional benefits to be paid or $542.17 x 3 = $1,626.51. Thus the resultant net overpayment is $7,205.51).

I hasten to add here that the Applicant testified he knew from the time he applied for benefits from the Insurer that the benefits from his automobile policy would be recalculated after he received payments from his private disability insurer. The Insurer fulfilled it obligations under s.14 of the Schedule by paying the Applicant what was thought to be his correct entitlement until he actually received payments from the other source. The Applicant received his 15 weeks of benefits from Mutual of Omaha in two lumpsum instalments: $2,000.00 about May 6, 1991 and $5,133.33 about June 19, 1991.

No Seaboard Life Insurance Company policy was produced at the hearing despite attempts by counsel to receive a legible copy of the policy wording from that insurer. It is my understanding of the meagre evidence on this issue that $1,035.00 in total was paid on the Applicant's behalf during the period of his disability to cover some car payments. I am unable to order these payments be deducted without more evidence relating to this policy. I merely observe that the only payments deductible from weekly benefits under s. 12(4)(b) of the Schedule are "payments for loss of income...under any income continuation benefit plan". It may well be that any payments made under the Seaboard Life policy fail to meet either of these underscored criteria.

Expenses:

The Applicant seeks an award of the expenses he has incurred in this arbitration. An award for expenses may be made under s. 282(11) of the Insurance Act, which provides as follows:

The arbitrator may award to the insured person such expenses incurred in respect of an arbitration proceeding as may be prescribed in the regulations to the maximum set out in the regulations.

The prescribed expenses and amounts are set out in Schedule 1 of the Dispute Resolution Practice Code and in Ontario Regulation 275/90 "Schedule".

In the McCormick vs. Economical Mutual Insurance Company case (O.I.C. No. A-000139), Arbitrator Susan Naylor made the following comments about expenses, with which I agree:

The discretion to award expenses should be exercised, having regard to the intent and purpose of the legislative scheme. The arbitration process has been established under the Insurance Act, as amended, in order to facilitate applicants' access to relatively inexpensive, speedy and informal adjudication of disputes regarding no-fault benefits. The discretion to award expenses should be exercised in accordance with this objective, having regard to the individual circumstances of each case.

Accordingly, it is appropriate to award an applicant his or her expenses, unless, in the circumstances of the particular case, it is determined that the application for appointment of an arbitrator was manifestly frivolous or vexatious, or that the applicant's conduct unreasonably prolonged the proceedings.

The Applicant is entitled to his expenses as set out in Schedule 1 of the Dispute Resolution Practice Code. In the event that the parties cannot agree as to the total amount of expenses, I remain seized of this matter and a party may apply for assessment of the expenses before me.

Order:

1. The Applicant is entitled to three further weeks of accident benefits from May 13 to June 1, 1991.

2. The correct amount of weekly income benefits is $542.17 per week.

3. There is an overpayment by the Insurer in the sum of $7,205.51, which shall be repaid by the Applicant to the Insurer. The Insurer may charge interest on the $7,205.51 from today's date, at today's bank rate.

4. The outstanding account for a functional interdisciplinary program for the Applicant is reasonable and should be paid by the Insurer. The amount outstanding is $2,514.50, less $350.00, plus G.S.T., assuming only the half day cost should have been charged for March 19 and 20, 1992.

August 21, 1992

K. Julaine Palmer Arbitrator

Date

APPENDIX 1

DETAILED CALCULATION FOR GROSS WEEKLY INCOME

1990 Gross income: $46,500.

Ceasing Expenses:

Advertising $ 90.

*insurance 1,720.

maintenance/repairs 1,791.

meals 512.

office expense 187.

gas 3,685.

carwash 750.

parking 186.

**car phone 1,026.

capital cost allow. 1,312.

Total Ceasing Expenses: $11.259.

• 1990 insurance: $4,140.00

1991 insurance: $2,292.78

Deduct 75% of $2,292.78 as ceasing expense = $1,719.59, rounded = $1,720.00

(Applicant ceased paying insurance 3 months after the accident = 25% of 1991 was paid)

** car telephone expenses = $ 1,219.71

less monthly fee (12 x 12.)

• 144.00

less annual licence

• 50.00

Total Ceasing Expenses: $ 1026.00

1990 GROSS INCOME: $4650000

less ceasing expenses:

• 11,259.00

Recalculated annual income: $35,241.00 (Amount A)

Amount A divided by 52: 677.71 (Amount B)

80% of Amount B: $ 542.00 (Weekly Income Benefit)