Neutral Citation: 1995 ONICDRG 163

A-005237

ONTARIO INSURANCE COMMISSION

BETWEEN:

E. Z.

Applicant

and

ROYAL INSURANCE COMPANY OF CANADA

Insurer

DECISION

Issues:

The Applicant, E. Z., was injured in a motor vehicle accident on October 31, 1990. She applied for and received statutory accident benefits from Royal Insurance Company of Canada (Royal Insurance), payable under Ontario Regulation 672.¹

Weekly income benefits were paid at the rate of $276.92 for the period from November 7, 1990 to May 31, 1991. Benefits were subsequently reinstated from June 15, 1992 to August 22, 1993. This arbitration concerns the Applicant's entitlement to weekly income benefits from August 22, 1993 onwards.²

The issues in this proceeding are:

1. What is the amount of weekly income benefits to which the Applicant is entitled?

2. Is the Applicant entitled to payment of weekly income benefits from August 22, 1993 to November 7, 1993 under section 12(1) of the Schedule?

3. Is the Applicant entitled to weekly income benefits after November 7, 1993 under section 12(5)(b) of the Schedule?

4. Is the Applicant entitled to housekeeping expenses under section 6(1)(f) of the Schedule?

5. Is the Applicant entitled to recover $2,992.50, representing the cost of a holiday in Florida, under section 6(1)(f) of the Schedule?

6. Is Royal Insurance entitled to repayment of any benefits paid, under section 27 of the Schedule?

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

Result:

1. The amount of the Applicant's weekly income benefits is $276.92.

2. The Applicant is entitled to weekly income benefits from August 22, 1993 to November 7, 1993 under section 12(1) of the Schedule.

3. The Applicant is entitled to weekly income benefits for the period from November 7, 1993 to August 15, 1994 under section 12(1) and section 12(5)(b) of the Schedule.

4. The Applicant is entitled to housekeeping expenses of $4,706 under section 6(1)(f) of the Schedule.

5. The Applicant is entitled to interest upon these amounts under section 24 of the Schedule.

6. The Applicant is not entitled to the expenses of a holiday in Florida under section 6(1)(f) of the Schedule.

7. The Insurer is not entitled to repayment of any benefits under section 27 of the Schedule.

8. The Applicant is entitled to her expenses under section 282(11) of the Insurance Act, R.S.O. 1990, c.I.8, as amended, and Ontario Regulation 664, R.R.O. 1990.

Hearing:

Present at the Hearing:

The Applicant:

E.Z.

Applicant's

Giulia Falbo Ahmadi

Representative:

Barrister and Solicitor

Insurer's

Stanley C. Tessis

Representative:

Barrister and Solicitor

The proceedings were interpreted by an Italian interpreter and were recorded by a court reporting service.

The witnesses and exhibits are listed in Appendix A.

Weekly Income Benefits:

Introduction

The Applicant is 44 years old and lives with her husband, S. Z.. They have three children. Their eldest daughter is married and lives with her spouse in a self-contained apartment in her parents' home; the other two children, who are 22 and 13 years old, live with their parents. The Applicant's first language is Italian.

The Applicant claims wage-loss benefits under section 12 of the Schedule. It is her position that, in addition to her homemaking duties, she worked in her husband's business at the time of the accident and can no longer work. The Applicant must establish her work and income from it before the accident, that she sustained physical, mental or psychological injuries in the automobile accident, and that she meets the standard of disability set out in the Regulation, all of which are in dispute. For the first three years after the accident, it is enough to show that the Applicant cannot do her former job - in the words of the section: that she suffers a substantial inability to perform the essential tasks of her employment or occupation. After 156 weeks - November 7, 1993 in this case - the test becomes stricter. Weekly benefits need not be paid to her unless:

it has been established that the injury continuously prevents the insured from engaging in any occupation or employment for which ..she is reasonably suited by education, training or experience.

The test under section 12 focuses on an applicant’s inability to engage in gainful work, not on the effect of the accident on the applicant's role as a homemaker or mother, or her ability to engage in her other activities of daily living.³

The Applicant's employment status and income

The Applicant and her husband described her working arrangements. While the Applicant’s testimony was less reliable, I found her husband’s testimony to be straightforward and credible, and I generally accept it.

The Applicant's husband, S. Z., operated a sole proprietorship in the name of Z. General Construction. The business had been in existence for approximately two years and had annual revenues of around $60,000. It involved miscellaneous construction work - predominantly excavation, but also some sodding, fencing, drywalling, carpentry, and repairs and renovations. Most of the work of the business - estimated to be about 80% - was subcontracted from one company, in which Mr. Z. previously had an ownership interest. However, from time to time, he did jobs for other customers; he estimated that he had six or seven other customers around the time of the accident.

The evidence indicates that Z. General Construction was essentially run as a family business. It was operated out of the family home. From there, the Applicant juggled the demands of taking care of the family and looking after her husband's business needs.

The Applicant did a variety of administrative and other tasks for her husband's business. She had a home office in her bedroom and installed a telephone line dedicated to business calls. Her tasks included:

• answering telephone calls from customers and suppliers (which she testified came at all hours of the day and night), and passing them on to her husband,

• organising the paperwork for the business including dealing with the accountant at year end,

• doing miscellaneous clerical and administrative work (but not typing - a secretary at her husband's former business helped her out by typing invoices and cheques),

• signing cheques for the business,

• doing the banking for the business (in the area of 3 to 4 deposits a month plus cheques to be cashed and withdrawals),

• driving her husband to his work site from time to time,

• refuelling her husband's truck and filling gas cans for other equipment,

• purchasing materials for her husband and taking them to his worksite, when he needed them,

• following-up on delinquent accounts (if telephone calls to the customer were unsuccessful, she would visit their premises in person).

Royal Insurance agreed that these represented the Applicant's tasks in the business.

It is not clear to me exactly how much of the Applicant's time was spent on the business. She did not keep regular hours and did not keep track of her time. The evidence is that she did whatever her husband needed her to do, at a time when she could best fit it into her schedule. She estimated that she spent four days a week working for her husband’s business, although she did not indicate the basis for this estimate.

There was an understanding between the Applicant and her husband that she would be remunerated for her work. I accept their testimony about this. She was not paid an hourly or fixed wage or a regular salary. According to the evidence, both the timing and the amount of remuneration were dictated by the cash flow of the business and its profitability.

The Applicant reported earnings of $15,200, $18,000, and $15,000 in her tax returns for 1988, 1989 and 1990, respectively.⁴ She did not make any adjustment for business expenses. The business issued her a T4A slip each year.

Although the Applicant saw herself working in partnership with her husband, she was not a formal partner in the business nor was she an employee, applying the usual common law tests. No statutory deductions were made from her earnings. The amount of the earnings attributed to her was deducted by her husband under the rubric 'management and administration fees" in his tax returns.⁵ She can perhaps best be described as a self-employed contractor providing services to the business, although nothing turns on this characterisation. I find that she falls within the parameters of section 12(1) of the Schedule as employed or self-employed at the time of the accident.

The evidence about how the Applicant’s remuneration was arrived at, and when it was paid, was vague. Like many family businesses, the arrangements were loose and they relied heavily on trust.

According to the testimony of Mr. N. Mohamed,⁶ who prepared the couple's tax returns but is not a qualified accountant, the Applicant's husband consulted him about a means to recognise the Applicant's contribution to the business. The Applicant's husband was concerned that payment of a regular salary was too inflexible in a new business in which cash flows were unpredictable. He also did not want to be bothered with administering statutory deductions. Based upon Mr. Mohamed's advice, the Applicant's husband decided to allocate his wife a proportion of the earnings of the business at year end, based on the "value of her contribution, the tasks she performed, and market forces." The actual amount decided upon in any year was strictly in the Applicant's husband's discretion. The Applicant's husband said that he paid his wife an amount for every week she worked, but this was often in arrears. If at the end of the year he felt that she deserved more than she had received, and the earnings of the business allowed for this, he paid her extra. No one who testified was able to provide any more details of how the earnings as reported in the tax returns were arrived at, or the breakdown of payments.

Both the Applicant and her husband withdrew money from the business periodically to pay their living expenses. I had no evidence as to how much the Applicant herself withdrew over the year. Mr. Hrycko, the accountant retained by Royal Insurance, testified that he did not do this calculation, as he was not retained to calculate or quantify the Applicant's income. His reports focused on the Applicant's tasks and her performance of them.

Mr. Hrycko characterised the allocation of income to the Applicant as a means of income splitting between the family for tax purposes and challenged the value of her services; he put their market value at only $5,100 per year.⁷ In his testimony, he said that, in his experience, the amount allocated to spouses in small businesses was not really attributable to work and that 'only in rare circumstances have I seen a fair market allocation of income to spouses as to their responsibilities in the business".

I do not think that this is fair to the Applicant. It seems to me that Mr. Hrycko’s report substantially undervalues the Applicant’s services; it fails to take into account the range of services that she performed for the business or her availability to work outside of regular hours. The Applicant was available to deal with business matters whenever the occasion arose; her hours were not restricted to regular working hours. If a customer phoned late in the evening or on weekends, as she testified sometimes happened, she was available to take the call. The Applicant’s availability should fairly be taken into consideration in evaluating her services to the business.

No doubt, income tax considerations informed the business arrangements here; that is to be expected. Arbitrators have reiterated that applicants are entitled to arrange their financial affairs, within the law, as they choose. They have also indicated that an applicant's income tax return, in which the applicant is required to sign a declaration as to the veracity of the information provided, is strong evidence of income, although it is not conclusive.

I am satisfied that the Applicant performed valuable work for the business for which she was entitled to be remunerated. Her earnings as reported on her income tax returns do not strike me as an unreasonable exchange for her services and are consistent over time. In the circumstances, I see no good reason to look behind the information in the Applicant's tax returns, to question the value of her services.

The Applicant reported earnings of $18,000 for the 1989 tax year. Her annualized earnings for 1990 were somewhat higher. Given that her 1990 earnings were fixed after the accident, I prefer to rely on her earnings as reported for the previous year. I note that these earnings are reasonably consistent with the Applicant's reported earnings in 1988 and for the nine months immediately before the accident. I accept the figure of $18,000 as reasonably representative of the Applicant's income in the 52 weeks before the accident, and base her benefits upon it.⁸

In the case of self-employed individuals, business expenses which cease as a result of the accident are deducted under the formula for calculating pre-accident income.⁹ In this case, there is no reason to attribute a proportion of the business expenses to the Applicant, since there is no evidence that she incurred such expenses. None were claimed on her income tax returns. Moreover, since the business continued after the accident, I heard no evidence as to ceasing expenses. I accept the Applicant’s husband’s evidence that he paid his son to take over some of his wife’s tasks after the accident for a short time.

Applying these numbers, the Applicant is entitled to a weekly income benefit of $276.92.¹⁰This is the amount at which she has been paid in the past, correctly, as I find here. This amount is subject to any deduction for post-accident income, which I deal with subsequently.

The Applicant claimed that, in the months before the accident, she earned an extra $65 a week, housekeeping for an acquaintance. She did not report this income on her tax returns. I am not prepared to include this income in the calculation of the Applicant's benefits. While I accept that the Applicant may have been employed in this capacity at some point, the evidence as to the details of this work, and the amount and duration of payments is unsatisfactory.

The test for benefits turns on the Applicant's inability to perform the essential tasks of her employment or occupation,¹¹ or, after November 7, 1993, of any suitable employment or occupation.¹² While the Applicant was fully occupied in meeting the demands of her multiple roles as homemaker, mother and business associate, the work she performed for the business was part-time, intermittent and fluctuated from day to day. Although the Applicant estimated that she spent four days a week working on business matters, this suggests a degree of regularity and predictability in her working schedule which is not supported by the evidence. I also note that the business was not a large operation, it was a sole proprietorship and, for the most part, involved work with one contractor. The Applicant's jobs and her work schedule were flexible and to a large extent within her discretion. The Applicant was able to choose when to do the tasks and generally fitted them into her domestic schedule. In this regard, the Applicant's job offered her substantially more latitude than that of a clerical employee in a regular office environment. Moreover, in a family business, parties are expected to be able to make some adjustments and accommodations in the allocation of tasks.

Disability

The accident was a frightening and traumatic event for the Applicant. She was driving her husband’s truck, alone in the vehicle, when she was struck by another vehicle as she proceeded through an intersection. A second vehicle, a cement truck, then collided with her truck. The Applicant's vehicle was demolished in the collision. She recalled seeing the cement truck driver's face, and falling down on the floor of her vehicle; she also heard someone saying "the lady is dead", but was not sure if they were referring to her. There is some controversy as to whether the Applicant struck her head or briefly lost consciousness.

The Applicant was able to go directly home from the accident scene; later that day, her family took her to the emergency department of the local hospital. At that time, her primary complaints were of chest pain and pain in her knees, which were bruised. She was found to have no broken bones and was discharged with analgesics.

The next day, the Applicant saw Dr. Joel Krivy, her family doctor. In addition to her previous complaints, she also complained about weakness and pain in her left arm, blurriness and abnormalities of vision. Since that time, she has seen Dr. Krivy on numerous occasions, with a multitude of complaints. These include: blurry vision , neck pain, headaches, dizziness, palpitations, abdominal pain, chest pain, leg, arm and back pain, fainting, sleep disturbances and insomnia, nightmares, phobias relating to driving, severe anxiety, nervousness, vomiting, forgetfulness, lack of concentration, generalised weakness and coughing up blood.¹³

Many of her symptoms have resulted in consultations with specialists.¹⁴ These include specialists in ophthalmology, orthopaedics, neurology, gastroenterology, urology, respirology, physiatry, psychiatry, psychology and pain specialists. The Applicant has difficulty pinpointing her symptoms to her doctors; during her testimony, she referred expansively to pain "all over her body". She has tried numerous forms of medication and rehabilitation modalities, without apparent success. Her principal problems currently are depression, anxiety and chronic fatigue, with headaches, neck, arm, back and knee pain.

I do not intend to review in detail the Applicant’s medical treatment. This is summarised in full in an addendum to Dr. George Rado's report dated October 5, 1994.¹⁵ The extensive medical evidence indicates no organic basis, or objective physical finding, that would explain or support the duration and intensity of the Applicant's ongoing complaints or apparent level of disability. Significant head injury is also ruled out. The doctors agree that any residual physical problems are not serious and are non-disabling. They agree that the Applicant’s problems are primarily psychiatric and psychogenic in nature, and that her residual physical problems cannot be effectively addressed until her psychological condition improves.

The Applicant has been diagnosed as suffering from post-traumatic stress disorder, with symptoms of anxiety, depression, nightmares, and driving phobia. The evidence indicates that after the accident, the Applicant stopped driving altogether for some time, but has been able to drive, at least for short distances, since receiving specialised therapy in mid-1992.¹⁶ The Applicant's psychiatric condition has been complicated by the development of chronic pain syndrome.

The relationship between post-traumatic stress disorder and chronic pain was explained by Dr. Krivy. He explained that symptoms associated with post-traumatic stress disorder, such as sleep disturbances, nightmares and extreme anxiety result in a state of chronic exhaustion that accentuates the perception of pain.

According to the doctors, the Applicant has great difficulty appreciating the nature of her problems and the purpose of the treatment she has received. She feels overwhelmed by her circumstances and has little insight into the psychological and emotional aspects of her pain.¹⁷She cannot bear to discuss the accident, a recognised feature of post-traumatic stress disorder. Unfortunately her therapists believe that this has hindered her recovery and that it is essential for her to review what happened in order to work through her extreme anxiety associated with the experience. Until recently, attempts to treat the Applicant with antidepressants and anxiolytic medication have repeatedly failed because she discontinued the drugs due to side effects or perceived side effects.¹⁸ Recently, the Applicant has been taking Prozac and this seems to have improved things.

At the hearing, the Applicant was dramatic in her presentation and easily fatigued, behaviour which is consistent with her presentation recorded in the reports of the health practitioners. According to the medical reports, this presentation characterises her attendance at medical and rehabilitation appointments, causing some doctors to describe her presentation as histrionic or hysterical.¹⁹ Her treating psychiatrist, Dr. Musisi, believes that this is in part a feature of her condition, and that cultural influences play a role in this. Dr. Krivy shares the view that the Applicant’s psychiatric condition has made her unable to tolerate lengthy medical examinations or legal proceedings, and that she lacks insight into her problems, in part explaining the dramatic behaviour and exaggerated responses.

Does the Applicant's psychological condition result from the accident?

Dr. Musisi is the Applicant's treating psychiatrist. He is a consultant psychiatrist at York Central Hospital. He first saw the Applicant at the end of August 1993, on a referral from Dr. Krivy.²⁰He is firmly convinced that the Applicant's present psychiatric condition stems from the accident. Dr. Krivy, and the majority of doctors who have seen her, share this view.

Dr. Harvey Stancer was appointed by Royal Insurance to conduct a psychiatric assessment in early 1994. His impressive curriculum vitae is marked Exhibit 3, Tab 16. Although he had initial reservations, Dr. Stancer ultimately accepted that the Applicant had suffered post-traumatic stress disorder for at least some months after the accident and that she suffered from chronic pain.²¹ However, it was his opinion that the Applicant's continued multiple complaints, exaggerated responses, and dramatic presentation were part of a longstanding histrionic personality disorder, that preceded the accident. He suggested a diagnosis of hypochondriasis.²² The essential feature of histrionic personality disorder is a pervasive pattern of excessive emotionality and attention-seeking behaviour, beginning in early childhood.²³ The diagnosis of hypochondriasis involves a preoccupation with fears of having a serious disease based on the person's misinterpretation of symptoms, despite medical investigation and assurance.²⁴

Although he is not a specialist, I attach particular weight to the views of the Applicant's family physician in this regard. Dr. Krivy has been the Applicant’s primary health provider for a number of years and saw her regularly both before and after the accident.

Dr. Krivy's notes²⁵ indicate that before the accident, the Applicant had a number of long-standing complaints and a history of visits to emergency departments for immediate treatment. Her problems included chronic obesity, low back pain, blood in her urine, abdominal pain and irritable bowel syndrome, which Dr. Krivy described as a "type of chronic pain". However, while the Applicant may have had problems, I accept the evidence of Dr. Krivy that, notwithstanding her complaints, she was functioning reasonably well and did not seek medical intervention for disabling levels of pain. I accept that the Applicant may have been more vulnerable to psychological insult, and that the effect of the accident may have been superimposed upon an underlying histrionic personality. Nonetheless, I am persuaded that the accident was a major factor contributing to the Applicant's subsequent psychological problems; therefore I find that these problems result from the accident.

Does the Applicant's psychological condition disable her from work?

The issue then is whether the Applicant's post-traumatic stress disorder and chronic pain syndrome substantially disable her from performing her essential tasks in her husband's business.

The Applicant testified that, since the accident, she has been inactive, spending much of the day resting. She has not felt well enough to take care of the family or do the bulk of the housework. On a good day, she is able to do some light domestic chores but she cannot sustain work over a long period. A cleaning service has been coming into the home once a week since the accident.

The Applicant testified that she does not answer the telephone at home for either personal or business calls, and has disconnected the telephone in her bedroom, because any noise gives her a headache.

According to the evidence of the Applicant and her husband, she has not been able to do any work for the business since the accident. Her husband did not attribute any more money to his wife after the accident, and testified that he hired his son to take over some of her functions for a short time, doing the rest himself.

The evidence indicates that these changes to family life have taken a significant toll on the Applicant's family. Her children, especially her youngest daughter, have assumed responsibility for most of the housework. There have been difficulties at home. The Applicant's youngest daughter attempted suicide in early 1994, necessitating the intervention of the Children's Aid Society and the local child and family services. While I was not provided with much evidence about the circumstances relating to the problems of the Applicant's daughter, it appears that these were, at least in part, related to the additional demands placed upon her and to a lack of emotional support from her mother, due to her mother's preoccupation with her own injuries.

Benefits were terminated on August 22, 1993. There is little evidence that the Applicant was capable of working or performing her usual activites of daily living before that time.

The doctors who saw her during this time were unanimous that the Applicant was severely disabled by her psychiatric condition. Dr. Krivy initially thought that the Applicant would be able to return to work within a short time after the accident, but revised his opinion when he began to understand the extent of her psychological difficulties. He spent the next two years trying to determine how best to treat her. He sent the Applicant to Dr. Kirsh, a family doctor who specialises in pain managment. In the end, Dr. Kirsh discontinued the consultations; he felt that he could not help the Applicant because she would not accept other therapy or medications. He believed, however, that her symptoms were genuine and that she was severely disturbed as a result of her post-traumatic stress disorder.²⁶ In April 1993, he wrote "Sadly, I think this woman is severely disturbed and may be so for a very long period of time. It might only be when she becomes fully psychotic that she will be able to receive medical treatment." The Applicant also saw Dr. Morris, a clinical psychologist who specialises in cognitive behavioural therapy, for about six months until the end of March 1992. With the exception of driving, he described his success with her as "marginal".²⁷ Another psychologist whom the Applicant saw in mid-1993 reported similar results.²⁸

A functional abilities assessment done in January 1993 described the Applicant as "completely unable to resume her activities of daily living" due to chronic pain and emotional difficulties. According to the report, the Applicant was unable to do almost any household tasks except laundry, which she could sustain for only four minutes.²⁹

Counsel for Royal Insurance contrasted this extreme level of dysfunction with other evidence: evidence from the family and in documentation, that the Applicant was able from time to time to engage in household activites and to do some tasks for the business in 1991 and 1992, and surveillance evidence taken on July 31 and August 1, 1993, that showed her participating in various recreational activities, without apparent difficulty or restriction.³⁰

The videotapes recorded the Applicant on a family outing to the cottage. They showed the Applicant engaged in a range of recreational activities, including walking, sitting without any back support, reclining sunbathing, bending, swimming and splashing in a playful water fight. The activites portrayed on the video do not require a high level of functioning, but they are a far cry from the picture of almost complete dysfunction reported in January. They also contradict her subjective complaints to the doctors who examined her.

Dr. Rado, a physiatrist who had examined the Applicant earlier in May 1993,³¹ was concerned that he was not getting the full picture. He could not get an accurate history from the Applicant and identified significant discrepancies in the findings of the doctors and on his own examination. He felt that he could not rule out voluntary modulation of symptoms and performance and did not expect any change in the Applicant’s status until her psychoemotional problems were addressed. It was primarily on the strength of this report and the videotapes that Royal Insurance terminated the Applicant's benefits on August 22, 1993. Much later on, when Dr. Rado had an opportunity to review the videotapes, he concluded that the Applicant was significantly misrepresenting her symptoms.³²

Dr. Stancer assessed the Applicant's psychiatric status in March of 1994. He expressed these concerns in even stronger terms, considering malingering to be a significant component of the Applicant's illness behaviour.³³

However, according to Drs. Musisi and Krivy, the Applicant's psychiatric condition seemed to be getting worse rather than better in the fall of 1993. She was admitted as an in-patient in the psychiatric unit at York Central Hospital under Dr. Musisi's care, in September/October 1993. After attending day-hospital, she had to be readmitted as an in-patient again in December 1993. She was finally discharged from the day-hospital in mid-January 1994.

From the date of the accident up to this time, I am satisfied that the Applicant was disabled from her essential tasks. Dr. Musisi and Dr. Krivy were convinced that the Applicant’s psychiatric problems were genuine, serious and disabled her from any work. I am persuaded by their testimony that her exaggerated responses and dramatic behaviour is, to a substantial extent, a function of the very condition that they are trying to treat and to her lack of insight into her own problems. This is supported by the reports of Dr. Kirsh³⁴ and Dr. Vigna.³⁵

Dr. Krivy also pointed out that the Applicant’s symptoms fluctuate; she has good days and bad days. This can explain her ability to perform the odd job for her husband and to do light household chores, depending on how she felt that day.

Business records for 1991 and 1992³⁶ showed that throughout this time the Applicant was able, on an intermittent basis, to do some of the things she had done on a routine basis for her husband before the accident. She occasionally did the banking for the business and continued to write a few cheques on the business account. The evidence suggested that on several occasions she had picked up supplies for her husband, although I accept that these were isolated occurrences. Receipts from gas stations indicated that the Applicant quite regularly stopped to buy gas, suggesting that she could do this part of her former tasks.

The test set out in the Schedule is "substantial inability to perform the essential tasks of ... occupation or employment". I find that the occasional and casual performance of the odd job that the Applicant did on a routine basis before does not meet this standard.

Royal Insurance, who videotaped the Applicant playing bingo during a weekend pass from the hospital in late December,³⁷ suggested that her condition was not as serious as thought by the doctors. I disagree. In my view, Dr. Musisi, as the Applicant's treating psychiatrist, was in the best position to make an expert assessment of the Applicant's psychiatric condition at that time, and I accept his opinion.

I also note that neither Dr. Krivy or Dr. Musisi regarded the activities portrayed in the videotapes as surprising or outside of the range of ability they expected. Moreover, the activities shown did not reflect the level of functioning required to work.

I am satisfied that the Applicant’s mental state rendered her substantially unfit for any remunerative work, including the work she did for her husband's business, up to the date of her discharge from hospital. I am persuaded that this is equally the case from June 14, 1992, when benefits were reinstated, until her discharge from hospital.

After the Applicant’s discharge from the hospital, the evidence indicates that she continued to perform poorly but started to show slow signs of improvement, enabling her to be more receptive to medical intervention and management. Dr. Krivy reported a "definite improvement", with better concentration, decreased anxiety and lessening of depressive symptoms.³⁸

This improvement was reflected in a job assessment carried out on August 15, 1994, which found that the Applicant was ready to return to light clerical work and to light housework but made a number of recommendations to assist her in increasing her level of activity.

Dr. Rado made similar findings in a second examination on October 5, 1994.³⁹ He cautioned that continued attempts to control the Applicant's anxiety were essential so that she did not give up as soon as she experienced any transient pain on increasing her level of activites.

In a report dated October 15, 1995, Dr. Krivy agreed that the Applicant was ready to start doing some light work as of the date of the job assessment in August 1994 and should be encouraged to do so regularly.⁴⁰

Dr. Musisi and Dr. Krivy testified that, in their view, the Applicant was still unable to engage in meaningful work as of the date of the hearing. Dr. Krivy testified that the comments he made in his report were only addressed to the Applicant's physical condition, although he acknowledged that this seemed inconsistent with his view that his treatment of the Applicant had ended.

Dr. Krivy felt that the Applicant's fluctuating symptoms, chronic fatigue, anxiety in stressful situations, and inability to concentrate disabled her from work because it made her unreliable and unpredictable in a routine office setting.

However, it seemed to me that both doctors were labouring under some misapprehension as to the specific demands of the Applicant's job. She does not have an ordinary clerical job. Her work offers her a great deal of latitude. Her job duties and schedule are quite flexible and she is able to work at her own pace and rest whenever she needs to. Some of the more stressful aspects of the job - such as collection of overdue accounts - could reasonably be continued by her husband until she feels ready to perform them. Such accommodations can be expected in a family business.

The medical evidence indicates that the Applicant’s mental and psychological condition had improved in the six months since her discharge from the hospital, and that it does not present the barrier to functioning that it did before. That being the case, and in the particular circumstances of the Applicant’s work arrangements, I find that the Applicant could reasonably have returned to the essential tasks of her job as of August 15, 1994. I find that, prior to that time, she was disabled from any remunerative work. Accordingly, I find that the Applicant is entitled to weekly income benefits until then.

Post- accident income

Section 15 of the Schedule permits an insurer to deduct from weekly benefits:

80 per cent of any income received or available from any occupation or employment subsequent to the accident.

After the accident, the Applicant’s husband did not allocate her any earnings. He took the position that, since she was not able to work, she was not entitled to be paid. The amount of several cheques that were cashed by the Applicant were reallocated to her husband as his personal draws, at year end.

Royal Insurance submitted that payment of the Applicant was within the sole discretion of her husband and suggested that these arrangements were intended to maximise the Applicant's benefits. In other cases, arbitrators have looked beyond the form of financial arrangements reached in a family business, in determining whether income is available to a family member.⁴¹

However, unlike the situation in the cases cited to me, the Applicant had no claim to any of the income earned. She was not a partner in the business. I am also satisfied that she did not engage in meaningful work for the business after the accident, for which she should reasonably expect compensation.

As I indicated earlier, occasionally the Applicant performed the odd task, such as depositing money, cashing a cheque or, on a rare occasion, picking up an item for her husband. I am not prepared to attribute any value to these incidental and isolated activities, nor am I persuaded that the Applicant had post-accident income available to her on this basis.

Housekeeping

The Applicant claimed expenses for a weekly cleaning service. These totalled $4,706⁴² to the date of the hearing.

I have no hestitaion in awarding the Applicant this expense. Housekeeping services were recommended by Dr. Krivy, Dr. Musisi and by both rehabilitation assessments. I have no reason to question the invoices for these services submitted by the Applicant.

Counsel for the Insurer submitted that the Applicant’s requirement for housekeeping services was not related to the accident, because the Applicant’s physical restrictions related, for the most part, to problems that pre-dated the accident. However, even if I were to accept this argument, the medical reports indicate that the requirement for housekeeping services is not limited to the Applicant’s physical problems but to the interplay between her physical and psychological problems.

Counsel for the Insurer also submitted that housekeeping expenses should not be paid, because the service had not proved to be of assistance in the Applicant's rehabilitation. I might be more sympathetic to this argument, had Royal Insurance aggressively pursued the other integral recommendations made by the Applicant's therapists to help the Applicant increase her activities of daily living. For example, both the 1993 and 1994 assessments recommended occupational therapy to increase the Applicant's independence; they indicated that housekeeping support could gradually be withdrawn as the Applicant's independence improved with the therapy.⁴³ As far as I know, this proposal was never implemented.

With appropriate intervention, one would expect the Applicant's need for help with household chores to gradually stop.

Holiday expenses

The Applicant claimed the cost of a trip to Florida in the spring of 1993. The total expense claimed was $2,992.50, including airfare and hotel for herself and her husband.⁴⁴

According to the evidence, it was probably Dr. Kirsh who suggested to the Applicant that a holiday might be helpful. There was no further evidence of the details of this and Dr. Krivy was not involved in the Applicant’s decision to take a holiday.

In his testimony, Dr. Krivy was asked about the value of the holiday. He thought that it might have been helpful to take the Applicant away from the stresses of her domestic environment, but described it as "grasping at straws", with nothing else having worked. He did not equate it to a form of therapy.

Section 6(1)(f) of the Schedule provides for payment of,

...reasonable expenses resulting from the accident... for, other goods and services, whether medical or non-medical in nature, which the insured person requires because of the accident

While a holiday may have been beneficial to the Applicant, the evidence falls far short of establishing that it was required because of the accident. The claim is therefore denied.

Expenses

Under section 282(11) of the Insurance Act, I have the discretion to award the Applicant her expenses in respect of the arbitration, as prescribed in Ontario Regulation 664. I exercise my discretion in favour of the Applicant in this case.

Order:

1. The Applicant is entitled to weekly income benefits in the amount of $276.92 for the period from August 22, 1993 to August 15, 1994.

2. The Applicant is entitled to interest upon this sum payable at the rate of 2% per month from the date the payments became overdue.

3. The Applicant is entitled to $4,706 for housekeeping expenses.

4. The Applicant is entitled to interest upon this sum payable at the rate of 2% per month from the date the payments became overdue.

5. The Applicant is entitled to her expenses incurred in respect of the arbitration proceeding pursuant to section 282(11) of the Insurance Act, and Ontario Regulation 664, R.R.O. 1990.

November 14, 1995

Susan Naylor

Senior Arbitrator

Date

APPENDIX A

Witnesses:

The Applicant

The Applicant’s husband

Dr. Joel Krivy, the Applicant's family doctor

Mr. Nazmin Mohamed, the Applicant's accountant

Dr. Seggane Musisi, treating psychiatrist

Peter James Szczepanowsk, private investigator

Manny Acacio, Private investigator

Exhibits:

Exhibit 1

Medical Brief filed by Applicant

Exhibit 2

Income Brief filed by Applicant

Exhibit 3

Medical Brief filed by Insurer

Exhibit 4

Income Brief filed by Insurer

Exhibit 5

Report of Dr. George Rado, dated October 5, 1994

Exhibit 6

Report of Dr. George Rado, dated October 11, 1994

Exhibit 7

Four Form 4 Medical reports of Dr. Joel Krivy, dated November 28, 1990, January 25, 1991, March 15, 1991 and September 27, 1992

Exhibit 8

Application for Accident Benefits, dated December 10, 1990

Exhibit 9

Employer's Confirmation of Income Form, dated December 10, 1990

Exhibit 10

Hospital records of York Central Hospital

Exhibit 11

Clinical notes and records of Dr. Alan R. Berger

Exhibit 12

Statement of the Applicant, dated April 1, 1993

Exhibit 13

Eight photographs

Exhibit 14

Videotape, July 1, 1993

Exhibit 15

Parking ticket

Exhibit 16

Videotape, Winter 1993

Exhibit 17

Videotape, August 1, 1994

Exhibit 18

Financial material

Footnotes

1. 1Prior to January 1, 1994, Ontario Regulation 672 was called the No-Fault Benefits Schedule. After that date it became the Statutory Accident Benefits Schedule — Accidents Before January 1, 1994. In this decision, the term "Schedule" will be used to refer to Regulation 672.
2. 2The Applicant originally claimed benefits for the period from June 1, 1991 to June 14, 1992. In a decision released on February 17, 1994, I ruled that the Applicant's claim to weekly income benefits for this period was time-barred. This decision was upheld on appeal, issued on December 22, 1994.
3. 3GiannaTritto and Wellington Insurance Company, August 10, 1992, OIC File No. A-001178
4. 4Exhibit 2, Tab A1-3; Tab 4, Exhibit 4, Tab 3-5
5. 5Exhibit 2, Tab A7-9; Exhibit 4, Tab 8-10
6. 6Report dated August 30, 1993; Exhibit 2, Tab A-11
7. 7Testimony of Oleh Hrycko, C.A.; reports of Hrycko & Associates Inc. dated August 4, 1993, Exhibit 4, Tab 1, December 3, 1993; Exhibit 4, Tab 2; and March 9, 1994, Exhibit 4, Tab 13
8. 8Schedule, section 12(7) 1
9. 9Schedule, section 12(7) 3
10. 10Schedule, section 12(4)
11. 11Schedule, section 12(1)
12. 12Schedule, section 12(5)(b)
13. 13Testimony of Dr. Joel Krivy, Reports dated July 28, 1993, Exhibit 1, Tab 12; and October 15, 1994, Exhibit 1, Tab 15; clinical notes and records, Exhibit 3, Tab 24
14. 14See Exhibits 1 and 3
15. 15Exhibit 5
16. 16Report from Dr. N.E. Morris, Ph.D.,C.Psych., dated March 23, 1992; exhibit 3, Tab 5
17. 17See eg. Report dated July 29, 1993, of Dr. Carlo Vigna, Ph.D., C.Psych., Exhibit 3, Tab 12
18. 18Report dated April 6, 1993, of Dr. Brian Kirsh, M.D. Exhibit 3, Tab 9; Report of Dr. Krivy, M.D., dated July 28, 1993, Exhibit 3, Tab 11
19. 19Report dated July 29, 1993, of Dr. Vigna, Exhibit 3, tab 12; Report , dated February 5, 1994, of Dr. Harvey Stancer, Exhibit 3, Tab 16
20. 20Report dated October 15, 1994, Exhibit 1, Tab 15
21. 21Report dated July 20, 1994, Exhibit 3, Tab 20
22. 22Report dated February 5, 1994, Exhibit 3, Tab 16; Report dated July 20, 1994, exhibit 3, Tab 20
23. 23Diagnostic and Statistical Manual of Mental Disorders (DSM-IV) para. 301.50
24. 24DSM IV, para. 300.7
25. 25Exhibit 3, Tab 24
26. 26Report dated April 6, 1993, Exhibit 3, Tab 9
27. 27Report dated March 23, 1992, Exhibit 3, Tab 5
28. 28Report dated July 29, 1993, of Dr. Vigna, Exhibit 3, Tab 12
29. 29Report dated January 9, 1993, of Karen Rucas, Occupational Therapist, Exhibit 3, Tab 6
30. 30Exhibit 14
31. 31Report dated May 20, 1993, Exhibit 3, Tab 10
32. 32Report dated October 11, 1994, Exhibit 6
33. 33Reports dated February 5, 1994 and July 20, 1994, exhibit 3, Tabs 16 and 20
34. 34Report dated April 6, 1993, Exhibit 3, Tab 9
35. 35Report dated July 29, 1993, Exhibit 3, Tab 12
36. 36Exhibit 18
37. 37Exhibit 16
38. 38Report dated October 15, 1994, Exhibit 1, Tab 15
39. 39Exhibit 5
40. 40Exhibit 1, Tab 15
41. 41See eg. Peter Bonitatibus and Wellington Insurance Company, April 8, 1993, OIC File No. A-000082 (no.2)
42. 42Exhibit 2, TabsB-1 and 11
43. 43Exhibit 3, Tab 21, p. 9
44. 44Exhibit 1, Tab B7