Neutral Citation: 1993 ONICDRG 55

File No. A-002057

ONTARIO INSURANCE COMMISSION

BETWEEN:

NASIB S. MANDER

Applicant

and

WELLINGTON INSURANCE COMPANY

Insurer

DECISION

Issues:

The Applicant, Nasib Mander, was kidnapped at gunpoint in his limousine on October 30, 1991. After the Incident, he was very nervous and absent from work for seven weeks. Mr. Mander applied for accident benefits from the Insurer, payable under Ontario Regulation 672 (the "No-Fault Benefits Schedule"), enacted under the Insurance Act, R.S.O. 1990, c. I.8.

The Insurer refused to pay any accident benefits. It contended that the psychological injury allegedly sustained by Mr. Mander arose out of a threat of the use of a gun and not as a result of an incident involving the use or operation of an automobile. Mediation was unsuccessful in resolving the dispute between the Applicant and the Insurer, and the Applicant applied for arbitration under the Insurance Act.

The issues in this hearing were:

1. Do the facts of this case fall within the definition of an "accident" for which accident benefits are payable under the No-Fault Benefits Schedule?

2. If so, what is the amount of weekly income benefit which should be paid to the Applicant?

The Applicant also claimed interest on any outstanding amounts owing and his expenses incurred in the hearing.

Result:

1. The Applicant suffered psychological injuries in an "accident" as defined by section 2 of the No-Fault Benefits Schedule on October 30, 1991.

2. The Applicant is entitled to 6 weeks x $600 per week in weekly income benefits, for a total of $3,600. The Applicant is also entitled to interest under the provisions of section 24 of the No-Fault Benefits Schedule.

3. The Applicant is entitled to his expenses of the hearing.

Hearing:

The hearing was held in North York, on July 26, 1993, before me, K. Julaine Palmer, arbitrator.

Present at the Hearing:

Applicant:

Nasib Mander

Applicant's

Allan Price

Representative:

Barrister and Solicitor

Insurer's

Chris Blom

Representative:

Barrister & Solicitor

The Applicant was the only witness at the hearing. He filed one exhibit book. The cases referred to by counsel are listed at Schedule "A" to this decision.

Evidence and Findings:

1. Do the facts of this case fall within the definition of an "accident" for which accident benefits are payable under the No-Fault Benefits Schedule?

The Applicant, Nasib Mander, was operating his limousine en route to Pearson International Airport in the early morning of October 30, 1991, when his passenger suddenly pulled out a gun. He was ordered to drive north into the isolated countryside, then told to stop the car, leave his money, get out and walk quickly away. The gunman then drove off. The Applicant was very anxious after this incident; he was off work for seven weeks.

Mr. Mander testified as to the psychological trauma he suffered on October 30, 1991. After the incident, he trembled and was very nervous. He could not sleep without pills. He went to see his family doctor and was referred to a psychologist for treatment. Seven weeks passed until he felt able to return to driving his limousine. Even then, he had to work into it slowly and began driving only in the daylight hours.

The Applicant's doctor wrote a report describing her opinion:

Please be advised that my patient Nasib Mander who is a taxi cab driver was involved in a gun point kidnapping accident on October 30th 1991.

As a result of this he developed severe anxiety and Insomia [sic]. He was not able to function normaly [sic]. He was treated with anxiolytic medications and was not able to perform job activties [sic].

He was unable to work from 30th of October 91 to 21st of December 91. During this time he had to get psychiatrist [sic] help and treatment.

I accept that the Applicant, Nasib Mander, suffered a psychological injury as a result of the incident of October 30, 1991 and was unable to perform the essential tasks of his occupation as a limousine driver for seven weeks thereafter.

The Insurer, however, is only obliged to pay accident benefits to an applicant if the applicant sustained his injury "as a result of an accident". "Accident" is defined in section 2 of the No-Fault Benefits Schedule as follows:

"accident" means an incident in which the use or operation of an automobile causes, directly or indirectly, physical, psychological or mental injury or causes damage to any prosthesis, denture, ...

The Insurer submitted nine cases which dealt with legislation or contracts worded in a similar fashion. Only one case considered the definition of "accident" exactly as it is worded in the No-Fault Benefits Schedule. The Applicant's counsel submitted that the insertion of the word "indirectly" in the definition makes the No-Fault Benefits Schedule different from other legislation and contracts.

In McAllister v. Dominion of Canada (O.I.C. File No. A-000926, December 3, 1992), Senior Arbitrator Frederika Rotter considered the definition set out in the No-Fault Benefits Schedule in a case where the Applicant's wife was murdered during the course of an armed robbery of the couple's motor home. The Applicant and his wife were sleeping in the motor home when the crime occurred. After setting out the definition of "accident", as above, Arbitrator Rotter wrote:

Therefore, in order to find that benefits are payable, I must be satisfied that the incident leading to Mrs. McAllister's death:

(1) involved the use or operation of an automobile, and

(2) that use or operation caused, directly or indirectly, the incident.

Arbitrator Rotter found the robbery and murder of Mrs. McAllister "arose in connection with the use of the motor home as accommodation, and not as a result of its use as an automobile." She found that the murder did not involve the use or operation of an automobile, within the meaning of the legislation.

In her discussion of causation, Ms. Rotter wrote as follows:

In the present case, the manner in which the motor home was being used or operated did not cause the murder, either directly or indirectly. The murder was the result of a criminal act which had nothing at all to do with the use or operation of a vehicle. The vehicle was merely the location of the crime: a crime which could easily have taken place in a dwelling place or elsewhere, without reference to the use of a motor vehicle.

In none of the cases¹ presented, except McAllister, are the words "directly or indirectly" part of the definition of accident. Accordingly, the reasoning of some of the cases presented, which rely heavily on the so-called "purpose" test and "chain of causation" test, may be distinguished. In my view, the traditional "chain of causation" may be broken by the words "...or indirectly" which appear in the regulation. Although a causal relationship between the use of the automobile and the injuries is required, the present wording does not require the injuries to be the result of the direct or proximate use of the vehicle.

In this case, a professional limousine driver was threatened with a weapon and kidnapped in his own vehicle. The perpetrator of the crime forced the Applicant to drive, at gunpoint, for more than 45 minutes, into the isolated countryside, then stole his vehicle. While driving the kidnapper, Mr. Mander testified he thought about his family and that he might be hurt or killed. He testified that, even to this day, at night he can become scared of single passengers who don't want to talk and who place bags on the seat beside them.

In my view, the fact of being forced to operate his vehicle while a gun was being held on him, caused Mr. Mander psychological injury. I therefore find that "the use or operation of an automobile" has at least indirectly, if not directly, caused the Applicant's injury.

In cross-examination, Mr. Mander testified that if a gunman had similarly appeared at his home or when he was alone in the street, he would be very upset as well. This may well be the case. However, in the actual incident in question, the Applicant was forced to operate his automobile: this operation, at gunpoint, caused him psychological injury. In my view, the lengthy period of forced operation of the automobile is crucial to my finding that the operation of an automobile has directly or indirectly caused psychological injury. If the gunman had instead immediately forced Mr. Mander from his vehicle and stolen it, the result might well be different. As was found in the McAllister case, the Amos v. Insurance Corp. of British Columbia (1993), 1993 CanLII 2787 (BC SC), 13 C.C.L.I. (2d) 274 (B.C.S.C.) case and others, the mere presence of an applicant in a vehicle when injuries are sustained is not sufficient.

2. What is the amount of weekly income benefit which should be paid to the Applicant?

Under the provisions of the No-Fault Benefits Schedule, the Applicant receives no weekly income benefit for the first week of disability (s.12(5)(a)). The Insurer does not dispute that for the next two weeks the Applicant is entitled to $600 per week in weekly income benefits. The issue is whether, for the last four weeks of the Applicant's disability, depreciation should be added to the Applicant's ceasing expenses, according to the provisions of section 12(7)3. of the Schedule:

3. 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.

Mr. Mander has a partner with whom he shares the operation and expenses of the limousine. He and his partner drive on alternate days. For three weeks after the accident, the limousine was unavailable for driving. For the next four weeks, Mr. Mander's partner did all the driving and assumed the expenses of the vehicle.

In 1991, Mr. Mander claimed $5,521.20 as his share of the capital cost allowance for depreciation of the limousine.

In my view, in some cases a reduction in the amount of depreciation expense following an accident may be appropriate, given the circumstances of the particular business in issue. In this case, the vehicle continued to be driven for four weeks while Mr. Mander recuperated. The business, in effect, continued. I do not consider this to be an appropriate case for any portion of depreciation to be regarded as a ceasing expense.

The expenses which ceased were those for gasoline, repairs, and carwashes. I accept the figures as presented by the Applicant and find he is entitled to $600 per week for the last four weeks of his recuperation.

In total, then, the Applicant is entitled to $600 x 6 weeks of weekly income benefit or $3,600.

The Insurer agreed to pay two drug accounts of $16.85 and $11.07, which represent medication prescribed for Mr. Mander by his family doctor in November 1991.

Expenses:

The Applicant seeks an award of the expenses he has incurred in this arbitration. An award for expenses may be made under section 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 664, R.R.O.1990, Dispute Resolution Expenses.

In the McCormick v. Economical Mutual Insurance Company case (O.I.C. File No. A-000139, October 2, 1991), Arbitrator 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 Director of Arbitrations approved this statement of the principles guiding an award of expenses in the appeal decision in Vito Luigi Calogero v. The Co-Operators General Insurance Company (O.I.C. File No. P-000251, February 13, 1992).

The Applicant is entitled to his expenses as set out in Schedule 1 of the Dispute Resolution Practice Code, including the $30 cost of the report of Dr. Hussain. 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 suffered psychological injuries in an "accident" as defined by section 2 of the No-Fault Benefits Schedule on October 30, 1991.

2. The Applicant is entitled to 6 weeks x $600 per week in weekly income benefits, for a total of $3,600.

3. The Applicant is entitled to the sum of $27.92 in supplementary medical and rehabilitation expenses.

4. The Applicant is entitled to interest on all amounts outstanding, pursuant to the provisions of section 24(4) of the No-Fault Benefits Schedule.

5. The Applicant is entitled to his expenses incurred with respect to the arbitration.

September 24, 1993

K. Julaine Palmer Arbitrator

Date

SCHEDULE "A"

Amos v. Insurance Corp. of British Columbia (1993), 1993 CanLII 2787 (BC SC), 13 C.C.L.I. (2d) 274 (B.C.S.C.)

Iaquone v. Florou et al.; Iaquone v. Aetna Casualty of Canada et al., [1981] I.L.R. 230 (Ont. S.C.)

Johnstone v. Lee, [1980] I.L.R. 669 (B.C.S.C.)

Law, Union & Rock Insurance Co. Ltd. v. Moore's Taxi Ltd. (1959), 1959 CanLII 81 (SCC), 22 D.L.R. (2d) 264

Gordon McAllister v. Dominion of Canada General Insurance Co. (1992), Ontario Insurance Commission File No. A-000926

Mclndoe v. Insurance Corp. of British Columbia (1990), 1990 CanLII 1801 (BC SC), 45 C.C.L.I. 68 (B.C.S.C)

Storrie v. Newman; Insurance Corp. of British Columbi'a, Third Party (No. 2) (1982, 1982 CanLII 724 (BC SC), 139 D.L.R. (3d) 482 (B.C.S.C.)

Topolinski et al. v. Harkness et al. (1956), 5 D.L.R. (2d) 50S (Man. Q.B.)

Watts v. Centennial Insurance Co. (1967), 1967 CanLII 520 (BC SC), 65 D.L.R. (2d) 529 (B.C.S.C.)

Yurkowski v. Federated Mutual Implement & Hardware Insurance Co. et al. (1975), 54 D.L.R. (3d) 72S (B.C.S.C.)

Footnotes

1. 1See list of cases in Schedule "A"