Neutral Citation: 1994 ONICDRG 133
File No. A-006208
ONTARIO INSURANCE COMMISSION
BETWEEN:
PATRICIA F. MAIN
Applicant
and
CANADIAN GENERAL INSURANCE COMPANY
Insurer
DECISION
Issues:
The Applicant, Patricia F. Main, was injured in a motor vehicle accident on July 29, 1991. She applied for and received statutory accident benefits from the Insurer, payable under Ontario Regulation 6721.
At the time of the accident, Ms. Main was a self-employed taxi driver in London, Ontario. She continues to receive disability benefits under section 12 of the Schedule because she has been unable to perform her pre-accident job tasks since the accident. Her entitlement to these benefits is not in dispute. However, Ms. Main and the Insurer did not agree as to the amount of her weekly income benefits. Ms. Main applied for mediation, which was not successful and she subsequently commenced this arbitration proceeding.
The issues to be determined at the arbitration hearing are:
What is the correct amount of weekly income benefits to which the Applicant is entitled?
Is the Insurer entitled to repayment of benefits received by the Applicant?
The Applicant also claimed interest on any outstanding amounts owing, and her expenses incurred in the hearing.
Result:
The decision is:
The Applicant is entitled to weekly income benefits of $185.60.
The Insurer is not entitled to repayment of benefits received by the Applicant.
The Applicant is not entitled to interest.
The Applicant is allowed to recover her expenses incurred in the arbitration.
Hearing:
The hearing was held in London, Ontario, on March 30, 1994, before me, Asfaw Seife, Arbitrator.
Present at the Hearing:
Applicant: Patricia F. Main
Applicant's Representative: Kimberley Munro Barrister and Solicitor
Insurer's Representative: Brian Atherton Barrister and Solicitor
Insurer's Claim Representative: Gail Boundy
Witnesses: Sam Lieberherr, Taxi Owner and Driver Terry Hunter, Taxi Owner and Driver
The proceedings were recorded by Court Reporter Doreen Johnson of Rogers Reporting.
Issue 1: What is the correct amount of weekly income benefits to which the Applicant is entitled?
Summary of the Relevant Legislation:
Weekly income benefits are based on 80 per cent of an applicant's gross weekly income from employment or occupation, up to the limits set out under section 12(4) of the Schedule. The gross weekly income is determined in accordance with the rules set out in section 12(7).
Section 12(7) provides that an applicant's gross weekly income from his or her occupation or employment is deemed to be the greatest of:
his or her average gross weekly income for the four weeks preceding the accident; or
his or her average gross weekly income for the 52 weeks preceding the accident; or
$232.00.
The Applicant has chosen to base the calculation of her gross weekly income on the average for the four weeks preceding the accident.
In calculating the gross income of applicants who were self-employed at the time of the accident, section 12(7)(3) provides that business expenses which cease as a result of the accident shall be deducted from the person's income from self-employment before calculating the gross weekly income.
In addition, section 15 of the Schedule provides that the Insurer may deduct from weekly benefits 80 per cent of any income received by or available to the Applicant from any occupation or employment subsequent to the accident.
Summary of the Dispute:
Ms. Main states that the Insurer paid her weekly benefit of $360.00 (based on 80 per cent of a gross weekly income of $450.00) for an initial eight week period when she was completely off. She started working part-time after eight weeks, on and off until May 16, 1993. During parts of this period, her weekly benefit was reduced to $289.84 to reflect deductions of 80 per cent of her various post-accident earnings. Ms. Main stopped driving completely on May 16, 1993, because of her injuries, and since May 25, 1993, the Insurer has been paying her $185.60 per week.
Ms. Main claims that her average gross weekly income from her employment for the four weeks preceding the accident was $625.30. She also disagrees with the Insurer as to the proper amount of the deduction of post-accident income under section 15 of the Schedule.
The Insurer's position is that Ms. Main's gross weekly income is the deemed minimum of $232.00 because she has not produced sufficient evidence of income higher than this amount. The Insurer claims it is entitled to repayment of benefits paid to Ms. Main in excess of $185.60 per week.
Summary of Evidence:
Ms. Main testified on her own behalf. I also heard evidence from Mr. Terry Hunter and Mr. Sam Lieberherr. Ms. Main submitted daily trip sheets for the first week preceding the accident, July 22 to July 27, 1991 (Exhibit 1, Tab 1) as well as the trip sheets for the periods of time she attempted to return to work after the accident (Exhibit 1, Tabs 2 to 8) . She also provided a table of her calculations showing weekly benefit payments she is entitled to receive during various disability periods (Exhibit 2). In addition Ms. Main filed a letter (Exhibit 1, Tab 9) sent to her by the Insurer in March 1993, asking her to complete certain medical forms and to produce a copy of her 1991 and 1992 income tax returns.
The Insurer did not call any witnesses. During the cross-examination of Ms. Main, counsel for the Insurer introduced into evidence the Application for Accident Benefits completed by Ms. Main when she initially applied for benefits (Exhibit 3) and the original version of Exhibit 1, Tab 1 (Exhibit 4)
Ms. Main left high school in 1961 and from that time up to 1989, she worked for a number of employers where she held a variety of job positions such as clerk, receptionist, bookkeeper and secretary. Ms. Main started driving a taxi in September 1989 and drove on a full-time basis until the day of her accident on July 29, 1991.
At the time of the accident, Ms. Main had been driving the same taxi for about a year on a full-time basis. She leased the taxi from Mr. Hunter, whom she "dated" and lived with in his house for a period of time before and after the accident.
Ms. Main and Mr. Hunter drove the same taxi; he was the day driver, from 4:00 a.m. to 4:00 p.m., and Ms. Main drove the night shift, from 4:00 p.m. to 4:00 a.m. They drove six days a week, Monday to Saturday.
After the accident, beginning October 1, 1991, Ms. Main tried to go back to work. She drove Mr. Hunter's taxi on a part-time basis until February 1993. From March 1993 to May 1993, she drove Sam Lieberherr's taxi, also on a part-time basis. On May 16, 1993, she stopped driving a taxi completely because of the pain.
Referring to Exhibit 1, Tab 1, Ms. Main testified that for the first week preceding the accident, her total "gross" income from driving a taxi was $1,037.00, before deduction of expenses. Her expenses for this week consisted of $300.00 for the lease of the taxi and $112.70 for propane. Ms. Main testified that the amounts of fare recorded on the trip sheets are the exact metered amounts of each trip. She also wrote in each daily trip sheet the amount of her lease and the propane charges for the shift. She did not record her tips and did not add them to the amount of gross income claimed.
Ms. Main stated that although her shifts were generally 12 hours long, she only worked the number of hours she needed to bring in the same amount each week, about $1,000.00 before expenses.
Ms. Main stated she had no expenses other than those for lease, propane and her yearly taxi driver's licence fee of about $25.00 or $28.00. Occasionally, she paid for a car wash from her pocket but the rest of the expenses for operating and maintaining the taxi were paid by Mr. Hunter.
Ms. Main stated that her income and expenses for the other three weeks preceding the accident (weeks of July 1, 8 and 15) were the same as for the first week.
On cross-examination, and after reviewing Exhibit 3, in particular the information she entered under the heading "Income from Employment", Ms. Main confirmed that the amounts of gross income indicated for all the four weeks preceding the accident were the correct amounts and that they were the exact amounts recorded in the daily trip sheets for the weeks in question. The forms show Ms. Main reported a gross income of $1,037.00 for the first week, and an identical amount of $1,050.00 for each of the remaining three weeks. She stated that these figures represented her earnings before the deduction of her expenses, which were the same as those for the first week.
Ms. Main did not submit as evidence in the arbitration hearing the trip sheets for the remaining three weeks preceding the accident because she no longer has them. She testified that when she applied for accident benefits, approximately one month after the accident, she had in her possession the trip sheets for all four weeks and in fact referred to them when she completed her application for benefits. Ms. Main stated that the Insurer only asked her to turn in the trip sheets for the first week. She threw out the trip sheets for the other three weeks, after a while, because she did not feel she needed them any longer.
Ms. Main explained that her usual practice with maintaining trip sheets is to note the transactions or events as they occurred and to store the completed sheets in a binder at her home. She kept them only for her own use to keep track of how much she made. She would keep them up to "a month or two" and would get rid of them because she would have no use for them after this period of time.
Ms. Main stated that her lease agreement with Mr. Terry Hunter was not in writing. She had no receipts for payment of the lease or for propane charges. She testified that all of her expenses and income receipts were "cash transactions".
Ms. Main testified that she has not filed any tax or GST returns from the time that she started driving a taxi in 1989. On cross-examination, she admitted that she was working "under-the-table" and stated that she did not maintain the trip sheets or other documents for tax purposes.
Ms. Main testified that when she and Mr. Hunter lived together, they maintained their own separate bank accounts; however, they often discussed financial matters and lent each other money, but nothing over a thousand dollars. Prior to the accident, if Mr. Hunter needed money she "would help with rent, food and living expenses". She moved out of Mr. Hunter's house in July 1992.
In his testimony, Mr. Hunter stated that he has been involved in the taxi business since 1968 both as a driver and an owner. He substantially corroborated Ms. Main's evidence that she had been driving his taxi for about a year at the time of the accident, that he charged her $300.00 per week to lease the taxi, that she was only responsible for propane, and that he paid all other expenses relating to the maintenance and operation of the taxi. He testified that for the four weeks prior to the accident, the taxi was in "A-1" condition and did not have any "down time", except for grease and oil jobs.
Mr. Hunter examined Ms. Main's trip sheets for the week of July 22 to 27 and agreed that, based on his experience, they were representative of the earnings of a taxi driver in London for a typical week in July of 1991.
Mr. Hunter testified that although he and Ms. Main occasionally compared how much they made in a day, he had no direct knowledge of Ms. Main's actual income for the weeks in question. He also did not have any documents to support the lease arrangement with Ms. Main or her expenses relating to the taxi.
Sam Lieberherr testified that he has been in the taxi business both as an owner and a driver since 1973 and has known Ms. Main since she started driving for him in February 1993. She drove part-time on a "daily lease" basis. He charged her $30.00 to $35.00 a day, Monday to Thursday, and if she drove Friday or Saturday, the daily lease was $60.00 to $70.00. He drove one of his other taxis at night and often saw Ms. Main driving and working hard, and "not hanging around donut shops like other drivers".
After reviewing Ms. Main's trip sheets for the week of July 22 to 27, 1991, he agreed that the amount of money recorded in the documents is comparable to what he used to make driving a taxi in London in the summer of 1991.
Mr. Lieberherr testified that he had no direct knowledge of Ms. Main's actual earnings for the weeks in question. He had no documents to prove the lease arrangement he had with her nor any records relating to her expenses.
Findings:
In her submissions, Ms. Main's counsel argued that Ms. Main has proved by uncontradicted viva voce evidence and the trip sheets for one week, that her average gross weekly income for the four weeks preceding the accident was $625.30 and that therefore her weekly benefit payable by the Insurer is $429.80 (sic)
The Insurer's counsel called no witnesses, and submitted that the evidence produced by Ms. Main is not sufficient to support her claim to entitlement of weekly benefits of any amount higher than $185.60.
I must therefore decide whether the evidence presented is sufficient to establish, on a balance of probabilities, that Ms. Main's average gross weekly income for the four weeks preceding the accident is greater than $232.00, and if so what this amount is.
In Jagdishar Singh and Kingsway General Insurance Company, January 29, 1993, OIC File No. A-000890, Senior Arbitrator Frederika M. Rotter stated:
The Applicant bears the onus of proving his gross weekly income. That onus can only be discharged through reliable and credible documentation of the Applicant's earnings and expenses.
I agree with Senior Arbitrator Rotter's statement. In my view, the oral testimony of the Applicant alone, without any corroborative documentary evidence, is not sufficient to discharge the onus in establishing gross income from self-employment.
The only documentary evidence Ms. Main submitted to prove her pre-accident income and expenses are the trip sheets for one week preceding the accident. These are clearly documents which Ms. Main has created herself for her own use. Accordingly, I find the trip sheets in themselves are no more reliable or trustworthy than Ms. Main's testimony of her income and expenses.
Even if I were to accept the trip sheets as reliable proof of their content, I can only conclude that they are proof of her income and expenses for the week to which they relate, i.e., for one week prior to the accident. I cannot conclude on the strength of this evidence alone that her gross weekly income for the other three weeks is also the same.
In order to determine the correct amount of weekly benefit payable to Ms. Main pursuant to section 12(4) and 12(7) of the Schedule, I require credible and reliable evidence about both her income and expenses for all of the four weeks prior to the accident. The evidence Ms. Main has provided about her income consists of her own uncorroborated testimony and the trip sheets for one week, which she created herself. I do not find this evidence sufficient to prove the amount of weekly benefits she claimed.
In my view, Ms. Main could have proved the amount of her income and expenses through records of transactions or documents made or created in the usual and ordinary course of conducting her business. However, it appears to me that Ms. Main preferred to work "under-the-table", and decided to conduct all her financial transactions in cash. She has not maintained any documentary record of her income from driving a taxi. She claims she destroyed the trip sheets within two months of their creation, and filed no income tax or GST returns. She kept no receipts, vouchers or agreements. She did not produce bank statements or any other documentary evidence to lend credibility to her claimed income or expenses. Unfortunately for Ms. Main, this practice has affected her adversely when it is in her interest to prove her income, as it is in the present case.
In my view, Ms. Main has failed to establish, on a balance of probabilities, that her gross weekly income for the four weeks preceding the accident exceeds the deemed amount of $232.00. Ms. Main may well have earned a gross weekly income in excess of $232.00, however, as an arbitrator, I do not feel I have the authority to award an amount greater than $232.00, unless that specific amount is clearly supported by the evidence.
Therefore, I find that Ms. Main is entitled to weekly income benefits of 80 per cent of $232.00, which is $185.60.
As indicated earlier in this decision, Ms. Main disagrees with the Insurer as to the correct amount of her post-accident weekly benefits. She states that the deductions made under section 15 of the Schedule do not accurately reflect her income and expenses from her post-accident employment. Considering the fact that the lowest weekly payment which Ms. Main claims to have received during the period of time in question is $289.84, and in view of my findings that she is entitled to weekly benefit of $185.60 and that the Insurer is not entitled to repayment of any benefits paid to her in excess of $185.60, it is not necessary for me to make a finding about Ms. Main's post-accident earnings.
Issue 2: Is the Insurer entitled to repayment of benefits received by the Applicant?
Repayment of benefits is governed by section 27 of the Schedule. Section 27(1) states:
A person must repay to the insurer any benefit received under this Schedule that is paid to the person through error or fraud.
This section requires that benefits must be repaid when they have been paid to the person through error or fraud.
In my view, the onus to prove that benefits were paid through error or fraud rests with the Insurer. Fraud is not in issue here.
In Dana B. Levenson and The General Accident Assurance Company of Canada, February 18, 1992, OIC File No. A-000260, Senior Arbitrator Susan Naylor stated:
The Concise Oxford Dictionary defines "error" as follows;
- A mistake. 2. the condition of being wrong in conduct or judgement. 3. a wrong opinion or judgement 4. the amount by which something is incorrect or inaccurate in a calculation or measurement.
There is therefore a number of meanings in ordinary usage that may be attributed to the word used. However, some assistance is provided by the statutory context in which the words appear. Subsection 27(2) and (3) provide for repayment of benefits in circumstances where there is no "error" but where the recipient is disqualified from payment or where deductible payments have been received, in which case repayment is required to the extent of the deduction.
These provisions suggest that the requirement of "error" in section 27(1) requires more than an error of judgement or "being wrong" on the part of the insurer in paying benefits. Otherwise, the broader wording of Section 27(2) and (3) would be redundant. It is not sufficient therefore to establish merely that an applicant has received benefits to which he or she is subsequently adjudged not to be entitled. To give meaning to the terminology of the section, the stipulation that benefits be paid "through error" in order to be recoverable must require that responsibility for the payment be attributable in some material way to the actions of the applicant.
[Emphasis added]
I agree with Senior Arbitrator Naylor's interpretation of section 27(1) and adopt it for the purposes of this case.
In his submission, Counsel for the Insurer sought repayment of the weekly benefits paid to Ms. Main in excess of $185.60 per week. The Insurer's counsel called no evidence, nor did he file any exhibits or make any arguments to support that Ms. Main was paid through error.
Accordingly, I find that the Insurer has not satisfied the requirements of section 27(1) of the Schedule and is therefore not entitled to repayment.
Order:
The Applicant is entitled to weekly income benefits of $185.60.
The Insurer is not entitled to repayment of benefits paid to the Applicant.
The Applicant is entitled to her expenses incurred in respect to the arbitration.
Asfaw Seife Arbitrator
Date
APPENDIX A
Exhibits:
Exhibit 1 Applicant's Document Brief
Exhibit 2 Applicant's Table of Calculations showing Weekly Benefit Payments
Exhibit 3 Application for Accident Benefits, dated August 28, 1991
Exhibit 4 Handwritten Trip Sheets for July 22, 1991 to July 27, 1991
Cases Referred To:
Said Mohamed Hassan and Kingsway General Insurance Company, October 18, 1991, OIC File No. A-002188
Soltan Davoudi Kahkesh and Lloyd's Non Marine Underwriters, March 31, 1992, OIC File No. A-000378
Soltan Davoudi Kahkesh and Lloyd's Non Marine Underwriters, August 19, 1992, OIC File No. P-000378
Dana B. Levenson and The General Accident Assurance Company of Canada, February 18, 1992, OIC File No. A-000260
Manuel Lopes and Federation Insurance Company of Canada, November 9, 1992, OIC File No. A-000602
Emmanuel Ntiri and Prudential of America General Insurance Company, April 19, 1993, OIC File No. A-002213
Kwabena Nyamekye and Lloyd's Non Marine Underwriters, December 17, 1992, OIC File No. A-001136
Mary Parisien and Royal Insurance Company of Canada, May 26, 1993, OIC File No. A-001978
Jagdishar Singh and Kingsway General Insurance Company, January 29, 1993, OIC File No. A-000890
Albert Stoll and Kingsway General Insurance, October 18, 1991, OIC File No. A-000386
Rekha Vasdani and The Personal Insurance Company of Canada, April 27, 1993, OIC File No. A-002148