Neutral Citation: 1993 ONICDRG 66

File No. A-003985

BETWEEN:

WAYNE ALLAN PLOWRIGHT

Applicant

and

WELLINGTON INSURANCE COMPANY

Insurer

DECISION

The Applicant, Wayne Allan Plowright, was injured in a motor vehicle accident on January 13, 1992. He applied for and received 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.

Mr. Plowright received weekly income benefits until January 22, 1993, when they were terminated. 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 are:

Is the Applicant entitled to weekly income benefits from January 23, 1993 forward?
At what rate is the Applicant entitled to weekly income benefits?
Is the Insurer entitled to a repayment because it has paid benefits through error or fraud?
Is the Applicant entitled to a special award, according to the provisions of section 282(10) of the No-Fault Benefits Schedule?

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

The Applicant is entitled to weekly income benefits from January 23, 1993 to the date of this decision.
The Applicant is entitled to income benefits at the rate of $600 per week. The Insurer is entitled to a credit of $240, representing 80 per cent of amounts earned by the Applicant after the accident.
The Insurer is not entitled to the return of any payments made through error or fraud.
The Applicant is entitled to a special award of $2,000.
The Applicant is entitled to interest pursuant to section 24(4) of the No-Fault Benefits Schedule and to his expenses incurred in respect of this arbitration.

The hearing was held in Peterborough on August 17 and 18, 1993 and concluded on September 28, 1993 in North York, before me, K. Julaine Palmer, arbitrator.

Present at the Hearing:

Applicant:

Wayne Allan Plowright

Applicant's Representative:

Michael J. Gillen Barrister and Solicitor

Insurer's Representative:

Chris T. Blom Barrister and Solicitor

Witnesses:

Dr. Judith A. Meade; Wayne Allan Plowright; Craig Richardson; Daniel Whatman, C.A.; Roy Kellett; Edgar LeBlanc; Dr. Arthur Ameis.

The parties filed an exhibit book and 11 other exhibits at the hearing.

Evidence and Findings:

1. Entitlement after January 22, 1993

The Job:

Mr. Plowright alleges that he sustained a physical injury in the accident of January 13, 1992. From the evidence at the hearing, I accept that he was qualified under section 12(2) of the No-Fault Benefits Schedule as either employed or self-employed at the time of the accident. However, in order to be eligible for weekly income benefits after January 22, 1993, Mr. Plowright must prove, on a balance of probabilities, that he continued to suffer a "substantial inability to perform the essential tasks of his... occupation or employment" after that date.

In this case, Mr. Plowright's occupation or employment was not immediately evident. He left General Motors in mid-1990 after working there more than 13 years, latterly as a group leader on the sealer line. That year he purchased a fibreglass swimming pool franchise and also worked as a general contractor performing excavating work, putting in footings, and digging septic beds with his new backhoe. In mid-1991, he began to work as a subcontractor on projects where companies managed by Roy Kellett were contractors. By July 1991, the swimming pool business had failed and he had closed that office.

On one of the Kellett jobs, Mr. Plowright acted as a "working foreman" doing site preparation on a townhouse project. Sewer and water lines were being installed, but Mr. Plowright testified, "he put me mostly on retainer walls at the end."

Mr. Plowright testified that for several weeks prior to the accident, he had not been asked to use his backhoe at the job site. He was mainly involved in building retaining walls. Mr. Plowright described how these walls were built: a backhoe or loader excavated the area, then gravel or compaction material would be placed, raked, and compacted with a hand compactor or mechanical compactor. The bases of the walls were concrete slabs of dimensions 1m long x 300mm wide x 100mm deep, weighing 80 - 90 pounds each. Two men handled these bases. Their placement needed to be exact--precise measurements were performed with laser instruments. Then interlocking concrete blocks weighing 27 pounds each would be placed on the bases. Blocks were laid at varying heights, as low as in a trench 3 to 4 feet deep to a maximum height of 17 feet.

Mr. Plowright testified he would lay between 50 to 100 blocks in one hour, depending upon the conditions. He worked between 8 hours and 12 to 14 hours per day, depending upon the weather. On rainy days, he might not work. He worked longer hours as a "pay day" drew near and often worked on Saturdays.

Roy Kellett testified that a crew would average 200 blocks per hour. On a daily basis, an average worker would lay 500-600 blocks, depending upon the height of the wall. Mr. Kellett testified that Mr. Plowright was a very good worker. He testified that his company stayed at the job site until approximately the end of January 1992, when the site was shut down until mid-April.

Mr. Plowright and Mr. Kellett both described the motion of a backhoe as being jarring and bouncing. They stated the backhoe has no suspension to smooth the operator's ride. Mr. Plowright emphasized the need for the operator to turn his head from side to side and to turn to operate controls located behind the seat. His evidence was supplemented by the testimony of Dr. Arthur Ameis, the physiatrist who examined Mr. Plowright at the Insurer's request. Dr. Ameis stated that a heavy machine operator must be able to freely turn his head, because of his responsibility for the safety of himself and others working around his machine. He also must not be taking medication which would distract him or cause him to be sleepy.

Mr. Plowright testified that in the six months before the accident he had used his backhoe in excavating foundations and sewer and water mains at two large projects in the Peterborough area. He stated, "My trade is excavating. I'm a heavy equipment operator. My trade is heavy work."

I find that Mr. Plowright, at the time of the accident, was both a heavy equipment operator, with particular skill in operating a backhoe, and a working foreman in the excavation and retaining wall trade. His essential tasks included being able to operate a backhoe daily over rough ground for 8 or more hours per day; being able to lift, carry, and place concrete bases weighing 80 to 90 pounds with another worker, and precisely situating these bases using survey equipment; and repeatedly bending, carrying, reaching and placing 27-pound concrete blocks at a rate of 500 to 600 blocks per day.

Wayne Plowright's ability to perform essential tasks after January 22, 1993:

Dr. Judith A. Meade, the Applicant's family physician since 1979, testified at the hearing. She stated that over the years she had treated Mr. Plowright for a number of work-related injuries to his neck, back and shoulder. He missed some time from work due to these injuries; however, he suffered no permanent injury prior to the January 13, 1992 motor vehicle accident.

Mr. Plowright's last appointment with Dr. Meade prior to the accident took place almost exactly one year before it. On January 15, 1991, Dr. Meade treated him for recurrent neck and back pain which had originated in a work accident in 1978 or 1979. Dr. Meade completed a Workers' Compensation Board form on January 15, 1991, although she was not sure whether the form, in fact, was forwarded to the W.C.B.

Dr. Meade first saw Mr. Plowright after the accident on January 28, 1992. He described how he had been injured in a motor vehicle accident on a local highway, when his backhoe was hit from behind in the curb lane by a vehicle attempting to pass a truck on the right. Dr. Meade recorded Mr. Plowright's complaints of pain in the mid-back (which he related to the height of the backhoe seat), neck pain, and continuous headaches. Numbness in his right forearm had cleared. Dr. Meade noted a lack of full flexion in Mr. Plowright's neck, pain on left rotation and also pain on the right side of his neck.

Dr. Meade examined Mr. Plowright next on March 3 and 10, 1992; April 7; May 14; May 28; July 28; October 29, 1992; January 4, 1993; February 16, 1993; April 1, 1993; and last on May 6, 1993. At that date she reported:

Wayne is unable to [do] repetative [sic] heavy lifting. Wayne is unable to do repetative [sic] twisting as required to drive heavy equipment. He could do this at 20 min. intervals. He is unable to sit for long periods of time.

Dr. Meade reported that she believed Mr. Plowright could return to his previous work for 4 hours per day within 6 weeks of May 6, 1993. She also reported that he could return 4 hours per day to light duty work within 1 month. Her prognosis for Mr. Plowright's condition was "not known, though I think he will be able to return to work eventually if he avoids back strain." She stated that her patient would be able to participate in an appropriate training program as of May 6, 1993, with the above limitations.

One year earlier, in May 1992, Dr. James M. Wishart, F.R.C.P.(C), an anesthesiologist specializing in treatment of pain, had examined Mr. Plowright at the request of the Insurer. At this point, Mr. Plowright was waiting to begin physiotherapy. Dr. Wishart wrote:

On examination he is markedly tender from T11 to L2 and his mobility markedly limited especially on extension. His muscle power seems to be normal.

As to current employment his future I think that he will have trouble with pain probably increased from time to time with a probable disc developing later. He works as a heavy equipment operator and is often required to lift concrete blocks weighing 60-80 pounds and I do not believe that he will ever be suitable to return to that on a full time basis. At this point it is hard to say how he will respond to physiotherapy but only time will tell. I believe it will be six months to one year before he could try driving one of his machines.

The Insurer next sent Mr. Plowright to be examined by Dr. Arthur Ameis on September 22, 1992. Dr. Ameis wrote in his report of October 19, 1992 as follows:

These symptoms are confined to the head and neck area. They consist of significant stiffness and pain in the neck, secondary headaches, upper back pain and stiffness, and proximal arm aching. There is no sustained numbness in either arm or hand. From time to time, the right hand will experience numbness along the radial aspect.

The patient feels that there has not been any significant change in his situation except that his symptoms are more intermittent and he has a full range of motion back. He finds that any type of vibration, as in a car, is very bothersome. He anticipates things would be much worse with the vibration of a backhoe or truck. Sneezing does bother him.

Discussion

This patient's past health history as described by the family physician suggests that he may be prone to neck problems, which is not unusual, particularly given the nature of his work. There may be an element of vulnerability and the likelihood of a more intense and more prolonged symptomatology given this history. (...)

The car accident was, in my opinion, a severe one, in terms of the forces involved and the lack of protection. The patient would in circumstance have undergone a very significant soft tissue strain injury through acceleration and hyperextension. (...)

He has had a severe strain. It may take between 12 and 18 months for his neck to settle down substantially to the point where he can tolerate a lot of vibration in the work place.

Dr. Ameis suggested that Mr. Plowright continue a program of exercises at home to strengthen his neck and shoulder muscles and to keep exposing his neck to a little bit of vibration. He recommended Mr. Plowright lift weights and drive as much as possible. "He can try other forms of exercise activity". Dr. Ameis recommended a rehabilitation worker be assigned to help Mr. Plowright find some form of employment "even temporarily". He also recommended that Mr. Plowright wait until mid-January 1993 before attempting a trial of work in a backhoe to assess his capabilities. Dr. Ameis offered to see Mr. Plowright in follow-up for the Insurer.

Mr. Plowright's family doctor arranged for him to be examined by Dr. J. Ivan McCully, who specializes in rheumatology and internal medicine. In his examination of Mr. Plowright on September 29, 1992, Dr. McCully found limitations in Mr. Plowright's ability both to extend and to rotate his neck and a significant increase in his pain with a combination of extension and lateral rotation. Dr. McCully wrote to Dr. Meade expressing his opinion and offered to see Mr. Plowright once more, in six weeks:

I think at the time of the accident he did suffer ligamentous strain of the lower cervical and also upper thoracic apophyseal joints and some contusion of the anterior neck muscles.

Mr. Plowright did not attend the second appointment with Dr. McCully in mid-November 1992. He testified that in November 1992, his father was gravely ill with lung cancer. He also stated that during this period he did not participate in more than two sessions of further physiotherapy at St. Joseph's Hospital.

In the fall of 1992, the Insurer engaged an investigator who took videotape footage on November 4, 1992 of Mr. Plowright assisting eight other men to unload his mother-in-law's furniture from a moving van. The Insurer sent the videotape to Dr. Ameis for his comments. On December 16, 1992, Dr. Ameis responded.

Dr. Ameis could not identify Mr. Plowright in the videotape. In his letter, Dr. Ameis suggested that it was problematic if one could not pick out the allegedly disabled individual from the group during such activity. He invited the Insurer to telephone him to discuss the matter further and to discuss the implications of his report of October 19, 1992, its findings, conclusions and recommendations.

Dr. Ameis could not recall if any such conversation subsequently took place. He had no notes of any discussion. No other witness was called by the Insurer, including the examiner in charge of the file.

The Insurer terminated weekly income benefits to Mr. Plowright, effective January 22, 1993. Mr. Plowright understood that the benefits were terminated on the basis of the videotape -- a videotape the Insurer did not show him until the first day of the hearing. The Insurer's Assessment of Claim form, dated March 3, 1993, is cryptic. It states that the entire claim for weekly income benefits was denied but that the Insurer would pay $600 per week from January 20, 1992 through January 22, 1993. It further states: "WEEKLY INCOME BENEFITS WERE TERMINATED DUE TO EVIDENCE INDICATING THAT WAYNE PLOWRIGHT WAS NOT DISABLED FROM HIS ESSENTIAL TASKS."

After Mr. Plowright's benefits were cut off, Dr. Meade wrote to the Insurer in a letter dated February 16, 1993.

...there appears to be no doubt that Mr. Plowright is capable of the activities videotaped. Mr Plowright acknowledges this, but does state that he has been advised by Dr. Wishart to increase his activity. He can do heavy work for short periods, but does experience considerable neck, back, and headache after such activity.

On examination he still does have some limitation of neck movement. (...)

Although your video indicates that Mr. Plowright is capable of heavy work for short periods of time, I do not believe that it proves he is capable of returning to his previous occupation which involves sitting on a heavy machine which moves over bumpy terrain for long periods of time. emphasis added)

That, of course, is the issue -- could Mr. Plowright substantially perform his essential job tasks after January 22, 1993?

Findings:

To be successful in this arbitration, the Applicant is obliged to prove, on a balance of probabilities, that he cannot perform his essential job tasks. Taking the evidence as a whole, in my view, it is more likely than not that Mr. Plowright has continued to be incapable of performing the essential tasks of his dual occupation as a working foreman building retaining walls and as a backhoe operator.

I conclude that, as of the date of the hearing, Mr. Plowright was capable of light duty work; he may even have been capable of performing his ownoccupation, for an hour or two each day. However, the No-Fault Benefits Schedule requires weekly income benefits under section 12(1) to be paid when an applicant is substantiallyunable to perform the key parts of his job. In my view, Mr. Plowright would not be capable of performing the key tasks of his occupation as of the hearing date.

I accept Mr. Plowright's testimony as to his inability to perform his essential tasks. I accept Dr. McCully's opinion and Dr. Meade's evidence of her assessment of Mr. Plowright's capabilities as of May 1993. I also accept Dr. Ameis' opinion and evaluation of Mr. Plowright in September 1992 and his prognosis at that time.

As Senior Arbitrator Naylor wrote in Donna Flemming v. Wawanesa Mutual Insurance (O.I.C. File No. A-000406, April 28, 1992), the concept of substantial inability covers more than the physical component of the work; there is a temporal nature to the term as well:

...the fact that the Applicant is able to perform some functions of her occupation on a part-time basis does not address the standard of disability set out in the regulations. The standard of disability under the regulation is met where it is established that an applicant suffers "substantial inability to perform the essential tasks of his or her occupation or employment". In determining an applicant's ability to perform his or her essential occupational or employment tasks, the demands of such tasks cannot be evaluated in isolation from the broader employment context.

The regulations contemplate inability to perform the duties of remunerative work. The performance of essential tasks must incorporate the ability to perform such tasks in a manner, at a speed or for a time that renders such performance capable of being remunerative.

Roy Kellett testified that in his business for production to be economic, he expected a crew of men to lay 200 blocks per hour and each man to lay 500--600 blocks per day. Likewise, a backhoe operator was expected to work a full day. As Dr. Ameis pointed out, because of the responsibility of the heavy machinery operator for the lives and safety of other workers, the operator must be able to freely turn his head and to work without taking medication which produces side-effects such as drowsiness or distractibility.

Accordingly, I find Mr. Plowright is entitled to weekly income benefits from January 23, 1993 to the date of this decision. The Insurer must pay all outstanding benefits, together with interest. According to the terms of the Insurance Act, the Insurer must continue to pay weekly benefits until a settlement agreement is reached or until it or the Applicant seeks a variation of this order under section 284 of the Act, or in the event the Director stays the order on an appeal (s. 283(6)). On the third anniversary of the motor vehicle accident, the test for eligibility for weekly benefits to be paid to Mr. Plowright will change. I make no observations in this decision with respect to the likelihood or not of benefits continuing until that date or beyond it. My decision is based on the evidence before me in the summer of 1993.

2. At what rate is the Applicant entitled to weekly income benefits?

Estoppel Argument:

Mr. Plowright's counsel made preliminary submissions on this issue. He argued that, because no issue was raised in the adjustment of this claim until the Response by Insurer as to any disagreement about the amount per week of Mr. Plowright's entitlement, that the Insurer should not be entitled to dispute the amount of benefit at the hearing. This issue was ultimately added at the hearing by agreement of the parties, but only with great reluctance on the part of the Applicant.

The Applicant agreed to include the issue to avoid a frustrating scenario in which he might receive a decision making him eligible for benefits, yet have no agreement with the Insurer as to the amount of weekly benefit which should be paid. Should that have occurred, a further mediation and perhaps even a further arbitration hearing might have been required.

I accepted the parties' agreement to add this issue under the provisions of section 282(3) of the Insurance Act.

In my view, the estoppel argument of the Applicant is not sustained by the facts of this case. Counsel for the Applicant cited a 1978 decision of the Ontario Divisional Court, written by Mr. Justice Grange: Re Tudale Explorations Ltd.¹ It is clear to me that in the proper case an Insurer would not be allowed to assert at arbitration that it then "suddenly" questioned the amount of weekly income benefit to which an Applicant would be entitled. I find in this case, however, the Applicant has failed to prove any clear or unambiguous representation by the Insurer, by words or conduct, that amounted to a promise not to insist on its strict contractual rights.

Amount of Benefit:

Before the accident, Mr. Plowright earned $800 per week, based on a 40-hour week; in addition, he was paid $35 for each hour his backhoe was in operation. Although Mr. Plowright was to be paid a fixed amount per week, he did not receive these payments weekly--he received lump sums by cash or certified cheque, sometimes $3,000 or $4,000 at a time. This reflected the pattern of contractor's draws as the work progressed.

At the hearing, the parties disagreed as to whether Mr. Plowright's position in the fall of 1991 and early winter of 1992 should be labelled "employment" or "self-employment". The importance of the characterization flows from the requirements of section 12(7) of the No-Fault Benefits Schedule with respect to calculation of gross weekly income.

12 (7) The following rules apply to the calculation of gross weekly income:

A person's gross weekly income shall be deemed to be the greatest of,

i. his or her average gross weekly income from his or her occupation or employment for the four weeks preceding the accident,

ii. his or her average gross weekly income from his or her occupation or employment for the fifty-two weeks preceding the accident,

iii. $232.

(. . .)
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. O. Reg. 273/90, s. 12.

Mr. Plowright's financial situation was further complicated by the fact that, within seven months preceding the accident, he had given up on a swimming pool business but continued with various other excavating work. Indeed, his finances were so poor in the six months preceding the accident, that he had made no payments on the backhoe he purchased in 1990.

Whether he was an employee or self-employed, Mr. Plowright's gross revenues in the four weeks preceding the accident were $3,200 ($800 per week x 4 weeks). Were he self-employed and had he business expenses and expenses which ceased as a result of the accident, then those expenses would have to be greater than $50 per week for him to be eligible for less than the maximum weekly benefit of $600 (see s. 12(4)).

I find Mr. Plowright's business expenses and expenses which ceased as a result of the accident equal or were less than $50 per week. From the oral evidence given by both the Applicant and his accountant, Mr. Whatman, and the written evidence of the 1991 "Statement of Income and Expenses-T2124" filed with Revenue Canada, I conclude that Mr. Plowright's expenses and ceasing expenses in the four weeks prior to the accident included a 4/52 pro rata share of the following expenses: $140 legal and accounting, $658 insurance, $1,392 maintenance and repairs, and $425 motor vehicle (excluding CCA). I accept Mr. Whatman's evidence that the payments owing on the backhoe had not been made in the previous six months. Since there was little expectation that these payments would be made, they should properly not be included as expenses of the business.

Since I find that the expenses and ceasing expenses are equal to or less than $50 per week, it is not strictly necessary for me to characterize Mr. Plowright's occupation in the fall of 1991 and early 1992 as either "employment" or "self-employment" and I decline to make any finding in this regard. I heard evidence that would be indicia of either characterization. In either case, I conclude that Mr. Plowright is entitled to $600 per week in income benefits.

According to the provisions of section 15 of the No-Fault Benefits Schedule, 80 per cent of amounts earned after an accident are to be deducted from weekly benefits paid by an insurer. Mr. Plowright admitted he earned two small amounts after the accident--in the summer of 1992 supervising the installation of a pool liner (80% x $100) and in the spring of 1993 supervising a roofing project (80% x $200). These deductions total $240.

3. Is the Insurer entitled to a repayment of benefits because it has paid benefits through error or fraud?

The Insurer is entitled to no repayment of benefits; the Applicant is entitled to $600 per week in weekly benefits from January 23, 1993 to the date of this decision. In addition, the Applicant is entitled to interest at 2 per cent per month according to the provisions of section 24 of the No-Fault Benefits Schedule.

4. Is the Applicant entitled to a Special Award, according to the provisions of section 282(10) of the No-Fault Benefits Schedule?

Section 282(10) of the Insurance Act sets out the criteria by which an arbitrator shall award a lump sum payment to an insured person where he or she finds that an insurer has unreasonably withheld or delayed payments.

282(10) If the arbitrator finds than 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.

"Unreasonable" behaviour by an Insurer in withholding or delaying payments can be seen as behaviour which was excessive, imprudent, stubborn, inflexible, unyielding or immoderate.

The manner in which the Insurer approached its obligations to Mr. Plowright under the No-Fault Benefits Schedule in this case has disturbed and puzzled me. Whereas I view the obligation of the Insurer to work as a partner with the Applicant, his family doctor and other health care professionals in the rehabilitation of this insured person, in many respects the claims of Mr. Plowright have been treated with suspicion, more like those of a third party in the tort system of damage compensation.

The Insurer did engage a rehabilitation worker to work on Mr. Plowright's case, but her services were terminated after about four months, when Mr. Plowright's income benefits were cut off. The rehabilitation worker had only begun to discuss educational and career options with Mr. Plowright, who had some ideas about retraining as a drafting technician. Early in the history of the claim, while Mr. Plowright waited months to obtain physiotherapy treatment at a Peterborough hospital, the Insurer failed to assist in funding or finding more prompt treatment.

In this case, it appears that the videotape was the major factor in terminating the Applicant's weekly benefits. An investigator captured the Applicant on videotape in a situation where a claims examiner might well be suspicious of the Applicant's abilities. However, a close viewing of the videotape should have enabled a reasonable examiner to conclude that there was no compelling evidence on the videotape which, in itself, would lead an impartial observer to believe that Mr. Plowright was able to substantially perform his essential tasks as a heavy equipment operator and working foreman building retaining walls.

No investigator testified at the hearing. The Applicant conceded that he appeared in the videotape. No one identified for me the individuals pictured in the unfocussed section of the videotape at the beginning. I could identify Mr. Plowright among the nine men pictured in the videotape, which began at a time shown as 12:12 p.m. and ended at 12:55 p.m. There is an unexplained gap of 22 minutes from 12:19 to 12:41 p.m. Mr. Plowright appears in the videotape on nine or ten occasions during the 21 minutes or less of tape remaining. He is depicted catching two pillows, carrying a kitchen table top, carrying a wooden kitchen chair with a pillow on it, standing talking outside and drinking a bottle of beer, going into the garage, going into the truck, carrying one end of a stereo stand and one end of a coffee table, carrying an octagonal end table alone, helping put the ramp back into the truck, and pulling down a garage door alone.

During the remainder of the videotape, the eight other men move furniture including a large t.v. console, an upholstered loveseat, mattresses and boxsprings, dressers, drawers, and a refrigerator.

To seek professional confirmation of her judgment, the claims examiner forwarded a copy of the videotape to Dr. Ameis for his comments. His observations were filed in a letter marked as exhibit 1.12. Some of his comments I have reproduced above. In addition, he wrote:

Essentially we have a situation in which an FAE [functional abilities' evaluation] is being performed gratus [sic] in real life for us, and the patient is not lacking in regard to functional capacity in all aspects. (...)

Perhaps you could give me a call so that we can discuss this matter further as the implications with regard to the patients credibility, and disability claim clearly require some further discussion particularly with regard to my report, its findings, conclusions and recommendations.

(emphasis added)

Dr. Ameis could recall no further conversation with the examiner; he had no notes of such a conversation. The examiner was not called as a witness. From the tone of Dr. Ameis' letter, in my view, he was concerned about the activity shown on the videotape, but did not consider the videotape such overwhelming evidence of malingering or other inappropriate activity that he immediately opined that the insured person was obviously substantially able to perform his occupation.

Dr. Ameis' letter called for further discussion of the matter. That discussion appears not to have happened. Instead, the Insurer decided to terminate Mr. Plowright's weekly benefits after one year's benefits had been paid. There was no further medical examination; there was no discussion of the results of the investigation with Mr. Plowright or his doctor. The Insurer had a meeting with Mr. Plowright on December 6, 1992, but it did not reveal, at that time, the existence of the videotape. It kept the information to itself.

The Insurer had in its file at that time the report of May 12, 1992 that it had commissioned from Dr. Wishart which stated: "He works as a heavy equipment operator...and I do not believe that he will ever be suitable to return to that on a full time basis... I believe it will be six months to one year before he could try driving one of his machines." It had a report from Dr. Ameis dated October 19, 1992 in which he stated that only after mid-January 1993 should Mr. Plowright "be put back into a backhoe or bulldozer on a trial basis to assess his capabilities". That same report stated:

He has had a severe strain. It may take between 12 and 18 months for his neck to settle down substantially to the point where he can tolerate a lot of vibration in the work place.

I conclude that the Insurer's action in thus terminating Mr. Plowright's weekly benefits was unreasonable; it was an immoderate, imprudent, inflexible, and excessive approach to its obligations toward him.

The termination of benefits sparked some correspondence, including a letter from Dr. Meade to the examiner, dated February 16, 1993, already cited above:

On examination he still does have some limitation of neck movement. (...)

Within three weeks of terminating the Applicant's benefits, the Insurer had received a letter from the Applicant's doctor, which squarely addressed the content of the videotape and the doctor's views of its value, in the context of her patient's occupation. I agree with Dr. Meade's conclusion.

The Insurer apparently had no second thoughts. Dr. Meade's letter provoked no further medical or occupational evaluation of Mr. Plowright's capabilities. Mediation of the claim followed from mid-February to mid-April 1993, but failed to produce any agreement between the parties regarding substantial issues. Mr. Plowright was not re-examined by Dr. Ameis or any other expert on behalf of the Insurer, and no further rehabilitation counselling was offered to him.

The decision of Senior Arbitrator Rotter in Larry Erickson v. The Guarantee Company of North America (O.I.C. File No. A-000560, dated July 16, 1992) comments on the nature of a special award under the Insurance Act. I agree, in general, with those comments. I find no evidence that there was deliberate misconduct or bad faith on the part of the Insurer; I find only that its conduct in terminating Mr. Plowright's weekly income benefits was unreasonable. The standard expected of an insurer's examiner and her supervisors is one of sound and moderate judgment. Unfortunately, this was not manifested in the unreasonable termination of Mr. Plowright's weekly income benefits.

Amount of the Special Award:

Under the provisions of section 282(10) of the Insurance Act, I may award a lump sum of up to 50 per cent of the amount to which the Applicant was entitled at the time of the award, together with interest as payable under section 24 of the No-Fault Benefits Schedule.

In the Erickson decision, Senior Arbitrator Rotter awarded a special award expressed as a percentage of the arrears outstanding as at the date of the hearing: 15% of an amount which was submitted to be approximately $36,000. This would equate to roughly $5,400 plus interest.

I prefer to express the special award in this case as a dollar figure. I award the sum of $2,000 to Mr. Plowright because of the unreasonable withholding of weekly income payments by his no-fault insurer. Since the amount outstanding from January 23, 1993 to October 23, 1993 equates to some $23,400 ($600 x 39 weeks), this award clearly falls within the 50 per cent limit.

Other Matters:

I make the following observations of the events surrounding this hearing to convey my serious misgivings about the minimal value of an unduly adversarial approach to no-fault benefit questions. However, my decision with respect to the special award is based entirely on my view of the unreasonable termination of Mr. Plowright's benefits in January 1993.

1. Videotape Evidence

I consider that the Insurer acted in a secretive and excessively confrontational style in its treatment of Mr. Plowright's claim, which continued in the proceedings at the Ontario Insurance Commission. The videotape was not shown to the Applicant during the course of the mediation or at the pre-hearing conference.

According to her report of the pre-hearing discussion, the pre-hearing arbitrator declined to order the videotape to be shown, because the Insurer's counsel stated he did not know if he was going to rely on the videotaped evidence. In her report, the pre-hearing arbitrator cautioned the Insurer that it risked being denied admission of the videotape into evidence at the hearing, if it was not shown to the Applicant and his counsel prior to the arbitration. The pre-hearing arbitrator did order that a summary of the surveillance evidence intended to be relied upon be provided to the Applicant.

A summary of the evidence on the videotape appears to have been provided to the Applicant, prior to the hearing, but its accuracy was challenged by the Applicant's counsel, prior to his viewing of the videotape.

During the argument on a preliminary motion at the hearing, the Insurer's counsel indicated he would be happy for the Applicant and his counsel to see the videotape. Once put to his election to have a ruling on the admissibility of the videotape evidence or view the videotape itself before the main portion of the hearing began, the Applicant and his counsel preferred to see the videotape. Had they permitted me to rule on the admissibility of the videotape, I would have refused to allow it to be filed that day as evidence.

The arbitration of this claim between Mr. Plowright and his Insurer was not enhanced by keeping the videotape secret from him and his counsel. This same videotape had already been shown to both Dr. Meade and Dr. Ameis and likely to Dr. Wishart as well. I take seriously section 8 of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22, which applies to arbitrations:

Where the good character, propriety of conduct or competence of a party is an issue in a proceeding, the party is entitled to be furnished prior to the hearing with reasonable information of any allegations with respect thereto.

In my view, "reasonable information" in this context can be interpreted to include the viewing of a videotape made of an allegedly occupationally disabled applicant moving furniture.

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.

The Applicant has been successful in this arbitration and is entitled to his expenses as set out in Schedule 1 of the Dispute Resolution Practice Code.

Order:

The Applicant is entitled to weekly income benefits from January 23, 1993 to the date of this decision.
The Applicant is entitled to income benefits at the rate of $600 per week. The Insurer is entitled to a credit of $240, representing 80 per cent of amounts earned by the Applicant after the accident.
The Insurer is not entitled to the return of any payments made through error or fraud.
The Applicant is entitled to a special award of $2,000.
The Applicant is entitled to interest pursuant to section 24(4) of the No-Fault Benefits Schedule and to his expenses incurred in respect of this arbitration.

October 29, 1993

K. Julaine Palmer Arbitrator

Date

Footnotes

cited as Re Tudale Explorations Ltd. and Bruce et al., (1978) 1978 CanLII 1471 (ON HCJ), 88 D.L.R. (3d) 584 (Ont. Div. Ct.)

Wayne Allan Plowright v. Wellington Insurance Company, 1993 ONICDRG 66

Case Summary