Neutral Citation: 1995 ONICDRG 201
File No. A-003235
ONTARIO INSURANCE COMMISSION
BETWEEN:
MIKE PANTAZOPOULOS
Applicant
and
WAWANESA MUTUAL INSURANCE COMPANY
Insurer
DECISION
Issues:
The Applicant, Mike Pantazopoulos, was injured in a motor vehicle accident on December 30, 1990. He applied for and received statutory accident benefits from the Insurer, payable under Ontario Regulation 6721. Weekly income benefits were terminated by the Insurer on July 30, 1992. Mr. Pantazopoulos felt his weekly income benefits should continue. The parties were unable to resolve their disputes through mediation and the Applicant applied for arbitration under the Insurance Act, R.S.O. 1990, c.I.8, as amended.
The issues in this hearing are:
Is Mr. Pantazopoulos entitled to weekly income benefits under section 12 of the Schedule from July 31, 1992 forward?
What is the correct amount of weekly income benefit to which Mr. Pantazopoulos is entitled?
Is the Insurer entitled to any repayment of benefits, based on fraud committed by the Applicant, according to the provisions of section 27 of the Schedule?
Mr. Pantazopoulos also claims interest on any outstanding amounts and his expenses incurred in the arbitration.
Result:
Mr. Pantazopoulos is not entitled to weekly income benefits after July 31, 1992.
The correct amount of weekly income benefit is less than $600, but because of the answer to question 3, it is not necessary to precisely calculate the amount per week.
The Insurer is entitled to be repaid under the provisions of section 27(1) of the Schedule, because of the fraud of the Applicant. The Applicant will repay all weekly income benefits paid after April 28, 1991, in the amount of $36,474.84, plus interest as provided under section 27(4) of the Schedule.
The Applicant is not entitled to his expenses of the arbitration.
Hearing:
The hearing commenced in North York, Ontario, on February 14 and 15, 1994, before me, K. Julaine Palmer, arbitrator. At that time, Mr. C. Andrikakis represented the Applicant. Ms. Mary Avalis acted as an interpreter in Greek and English. Mr. Mike Pantazopoulos testified in Greek, as did his friend, Mr. Jim Goletsos. Dr. Ambrose Fung and Ms. Soula Pantazopoulos testified in English.
The hearing resumed on March 21, 1994. On that occasion, Mr. David Downs of the firm Zaldin & Zaldin appeared on behalf of the Applicant. Ms. Avalis, once again, acted as interpreter. Mr. Downs explained that the Zaldin firm had been retained only in the week prior to the resumption of the hearing. At the request of the Applicant's counsel, an adjournment was granted.
A new Notice of Hearing was mailed by the Commission on April 25, 1994, with the resumption of the hearing to occur on August 22, 23, and 24, 1994. When the hearing resumed on August 22, 1994, Mr. Pantazopoulos was present, along with one of his daughters. An interpreter, Ms. Eleni Tzotzis, was present and provided interpretation services. Mr. Pantazopoulos had terminated the services of his solicitors Zaldin & Zaldin in June 1994, and had retained another law firm in the third week of July 1994. He stated that on Tuesday, August 16, 1994, his then lawyer had advised him that he could not appear. Mr. Pantazopoulos stated that he had been, as recently as before 9:00 a.m. that morning, to the offices of other solicitors, but found no lawyer there.
In the circumstances, I granted an adjournment and indicated to the Applicant that at the next resumption of the hearing, the hearing would continue regardless of whether or not he had a legal representative. The resumption date was fixed for January 3, 4, and 5, 1995, unless Mr. Pantazopoulos' new counsel and the solicitor for the Insurer could agree to other dates.
On December 21, 1994, the pre-hearing arbitrator conducted a telephone conference with Mr. Pantazopoulos and the solicitor for the Insurer. They reviewed various procedural matters, including the list of witnesses who were to be called on the resumption of the hearing. At that time, Mr. Pantazopoulos had no legal representative and did not intend to secure one in the interim.
The hearing resumed on January 3 and 4, 1995. Mr. Constantine Iliopoulos acted as an interpreter during the telephone conference in December, and again at the resumption of the hearing. The only witness on January 3, 1995, was Derek Vedza, who testified very briefly. On January 4, 1995, Konstantina Pantazopoulos, wife of the Applicant, testified. During the cross-examination of Mrs. Pantazopoulos, Mr. Pantazopoulos decided to terminate his participation in the proceedings. The hearing continued in his absence. The following witnesses were called by the Insurer: Wanda Lacroix, Gordon Osborne, Wayne Besso, Steven Flood, and Dieter Mayer.
The Insurer was represented throughout by Guy Farrell, Barrister and Solicitor, throughout. The parties filed a brief of medical documents and 27 other exhibits.
The proceedings were recorded by Dawn Binkowski, certified court reporter, office of Paul Rosenberger, on February 14 and 15, and March 21, 1994. The proceedings of January 4, 1995, were recorded by Stephen A. Van Alstyne, certified court reporter.
Evidence and Findings:
Mr. Pantazopoulos testified that on December 30, 1990, he was driving north on Logan Avenue in Toronto when he stopped his automobile at the stop sign at the intersection of Mortimer Avenue. While he was waiting for traffic to clear, his vehicle was hit from behind. Mr. Pantazopoulos' three teenage children were in the car with him at the time. Mr. Pantazopoulos was taken by ambulance to Toronto East General Hospital where he was x-rayed and released. The radiologist determined that moderate spasm was present, centred in the region of C6-7 of Mr. Pantazopoulos' cervical spine.
Mr. Pantazopoulos claims that he is still disabled from performing the essential tasks of his occupation as an office cleaner. At the time of the accident, Mr. Pantazopoulos' firm, Unite Building Maintenance, held cleaning contracts for a bank located at Spadina and Queen Streets in Toronto, and a banking machine at 56 Kensington Avenue, Toronto.
Mr. Pantazopoulos claims that since the accident, he has only been able to do very light work, if anything at all, for his cleaning business, and that his duties have largely been assumed by other members of his family.
Issue 1: Entitlement after July 31, 1992
In order to be entitled to further weekly income benefits after July 31, 1992, Mr. Pantazopoulos must "suffer substantial inability to perform the essential tasks of his occupation or employment". Many arbitration decisions have commented on the wording of this test. Arbitrators have commented that a substantial inability means a sizeable inability to perform essential tasks, not just some inability to work.
It is also important that the arbitrator receive detailed information about the precise nature of the duties of the insured person so a determination can be made of the essential tasks of the occupation or employment.
In this hearing, I received no written description of the duties which Mr. Pantazopoulos performed, apart from the contract with the bank which outlined in detail the cleaning to be done. Mr. Pantazopoulos testified, various times, that the cleaning at the bank involved mopping, vacuuming, dusting, cleaning windows, and taking out garbage. He gave no testimony about his ability to do any of these jobs, except to admit that he was able to do light work such as dusting and emptying wastebaskets. He did state that in 1991, he was not capable of vacuuming.
The Insurer engaged FIT to conduct an assessment on April 10, 1992. The assessors concluded that the Applicant could not do a full-time cleaning job. However, they also noted inconsistency of effort by the Applicant.
A report of the Applicant's general practitioner, Dr. Ambrose Fung, dated October 5, 1993, was filed by the Applicant. In that report Dr. Fung outlined Mr. Pantazopoulos' attempts at physiotherapy and more aggressive rehabilitation at the Toronto Rehabilitation Centre in 1993. Dr. Fung stated that Mr. Pantazopoulos had only been able to work as a cleaner for two hours maximum each day. Dr. Fung also noted a report from an orthopaedic surgeon, Dr. G. Maistrelli, dated August 20, 1993, which apparently reported that Mr. Pantazopoulos was suffering from "chronic neck and low back pain syndrome". Unfortunately, I did not have the benefit of reviewing the report from Dr. Maistrelli.
Other reports from specialists were filed by the Applicant, relating to a hospitalization in 1989. I do not find them to be helpful in the issues before me. Other records were filed by the Insurer, including the clinical notes of the Warden-Ellesmere Chiropractic Office from 1988 and 1990, prior to the accident. Those records outline the Applicant's complaints of intermittent low back pain for a few years, and pre-existing right mid-back pain, for eight years. The records show 15 treatments at the clinic in 1988 from March until May of that year, and six treatments in May 1990. However, both Mr. and Mrs. Pantazopoulos deny that Mr. Pantazopoulos ever had any back problems prior to the accident.
From the notes of Dr. Vavougios, one of the Applicant's family doctors during the years before the accident, it is clear that Mr. Pantazopoulos complained of lumbar pain in 1988, as well as neck pain in 1989.
The Applicant was examined by Dr. N.H. Bayer, neurologist, on May 14 and December 10, 1991, November 24, 1992, and May 25, 1993. Dr. Bayer felt that there was no reason why the Applicant could not return to his cleaning work. In addition, the Applicant was sent by the Insurer to see Dr. J.K. Houston, orthopaedic surgeon, on December 10, 1993. Dr. Houston also did not believe the Applicant suffered from any significant difficulties. Dr. Houston also noted a marked difference in Mr. Pantazopoulos' behaviour and lack of ease of movement when he presented on formal examination, in contrast to his apparent ease of movement in such actions as removing and replacing his clothing and socks, and in his behaviour in the parking lot of Dr. Houston's office.
I further find that from at least the spring of 1991, the Applicant has participated in a meaningful way in the cleaning of the bank. I find that whereas prior to the accident, in most cases, Mr. Pantazopoulos would complete the cleaning duties throughout the night on his own, the practice of his firm has since become to send in a team of three to five persons to complete the work in about four hours.
It is clear to me that Mr. Pantazopoulos confines his work mainly to the second floor, or to the basement of the bank, and does not work on the main floor, where his movements would be easily observed. I do not accept his testimony that he attends at the bank only to perform such duties as mixing sprays, supervising, and doing occasional light dusting.
The hearing proceeded over almost a year. Mr. Pantazopoulos testified in February 1994. His wife, Konstantina Pantazopoulos, did not testify until January 1995. I have great difficulty with the testimony of Mrs. Pantazopoulos, which was contradictory in many aspects, especially relating to the work that her husband did, following the accident. Her testimony also conflicted with the evidence of her husband as to whether he had been working in February 1994 at the bank. However, Mrs. Pantazopoulos did testify about her husband's improvement into the summer of 1994 and that he was able to resume full-time duties in the late spring of 1994.
At the very least, some witnesses on behalf of the Applicant have testified that the Applicant has returned to full-time duties at some point over the course of the last four years. This evidence supports my view that the three instances of investigation (in April 1991, April 1993, and February 1994), when the Applicant was observed on successive days working at the bank or the banking machine, were not merely coincidental or isolated occasions.
The Applicant questioned the identity of the individual observed in the videotapes, particularly the scenes in 1991 and 1993. Much was made of the fact that the man depicted in some of the videotape had a mustache. Mr. Pantazopoulos denied having a mustache since 1975. However, both Mr. and Mrs. Pantazopoulos commented that the person they observed mopping at the green machine was someone who could hardly move, and it not being the correct way to mop. Neither Mr. Pantazopoulos nor his wife denied that the individual in the videos was Mike Pantazopoulos. Mr. Pantazopoulos stated that it "might" be him. In fact, Mr. Pantazopoulos did admit that it was him on the videotape in answer to questions put by Mr. Farrell, at page 125 of the transcript:
Q We will talk about those things later. Sir, you were mopping in April of 1991? AProbably.
Q Yes we saw you. When you came to my office, we saw you on the videotape mopping.
A Yes.
In his submissions, counsel for the Insurer described a process of "evolution of the evidence" on the part of the Applicant. I agree with his observations that as the hearing progressed, a refining of the evidence took place, when Mr. Pantazopoulos, or members of his family, understood that certain points would raise a difficulty.
I conclude, therefore that Mr. Pantazopoulos has not met the onus of proving that, on a balance of probabilities, he suffered a substantial inability to perform the essential tasks of his occupation as a commercial cleaner after July 31, 1992.
Issue 2: Quantum of benefits
The Applicant contends that he is entitled to receive $600 in weekly income benefits based on contracts in existence at the time of the accident amounting to $4,500 per month in total. His position at the outset of the arbitration was that prior to the accident, all the labour on the contracts was his own, he had very few expenses and accordingly, he was entitled to the maximum weekly income benefit.
Although this may in fact be the case, this contrasts sharply with the picture presented in Mr. Pantazopoulos' income tax returns. In 1989 and 1990, gross revenues of the business are shown as $36,546 and $47,890, respectively. However, in 1989, Mr. Pantazopoulos' business income is shown as $14,284.32, and in 1990 as $20,040.12. In 1989 and 1990, 40% and 35%, respectively, of the business' net income was paid to Mr. Pantazopoulos' brother, Jim. The 1989, 1991, and 1992 Statement of Income and Expenses was provided to me, but not the 1990 statement.
The Insurer filed an accountant's report, dated March 14, 1994. That report assumes that all the business income in 1991 and 1992 should be allocated to Mike Pantazopoulos, although 50 per cent of it was allocated to Jim Pantazopoulos in 1991 and 35 per cent in 1992. David L. Smith, C.A., calculated that Mike Pantazopoulos was entitled to a weekly income benefit of $455.86, based on his average weekly income in the four weeks prior to his accident. He also calculated an average post-accident weekly income of $342.23 and $330.38 in 1991 and 1992 respectively. This post-accident income is deductible at a rate of 80 per cent from any weekly income benefit otherwise payable to Mr. Pantazopoulos, under the provisions of section 15 of the Schedule.
It is clear to me that the Applicant is not entitled to weekly income benefits in the maximum amount of $600. I received very little evidence from the Applicant about his business operating expenses, both before and after the accident. This is a very small proprietorship operating out of the home of Mike and Konstantina Pantazopoulos. Although some amount would be acceptable for provision of office space for the company in the family home, the amounts which have been claimed in the income tax statements of expenses appear to me to be entirely unreasonable. Other expenses such as the use of the family automobile in the business also appear to be grossly exaggerated.
It is unnecessary for me, however, to calculate the precise amount of weekly income benefit to which Mr. Pantazopoulos is entitled because of my views with respect to his lack of entitlement after April 28, 1991. Those views are explained in the following section.
Fraud of the Applicant
The Oxford Dictionary defines fraud as "criminal deception; dishonest artifice or trick". Under the terms of the Schedule, in section 27,
27.--(1) A person must repay to the insurer any benefit received under this Schedule that is paid to the person through error or fraud.
As of the late spring of 1991, based on the evidence before me, I find Mike Pantazopoulos was entirely capable of working in the family cleaning business and did, in fact, work at the family cleaning business.
It may well be that Mr. Pantazopoulos was not as productive in the early months after the accident as he had been prior to the accident. However, Mr. Pantazopoulos' productivity is not at issue here, unless he can prove that he suffered a substantial inability to perform his essential tasks. A complicating factor in this case has been that the style of doing business of Unite Building Maintenance has changed since the accident of December 30, 1990. The business which once may have been primarily the occupation of Mr. Pantazopoulos has become a family operation. I accept, however, based on the evidence of Wanda Lacroix, business manager of the Toronto Dominion Bank, that in the years prior to the accident, members of the Pantazopoulos family did work with Mike Pantazopoulos, at least on an occasional basis, in cleaning the bank. As time passed after the accident of December 30, 1990, the Pantazopoulos teenagers have grown into older teenagers and young adults. Aris, who was only 12 at the time of the accident, is now 16, and Sandy, the eldest, is now 20. Some cleaning is now done by every member of the family, and each one receives a share of the income of the business.
I find the testimony of Mike and Konstantina Pantazopoulos entirely unreliable. Their evidence about whether or not Mr. Pantazopoulos had a mustache in the years since the accident illustrates a lack of candour on their part. If Mike Pantazopoulos had not had a mustache at all since 1975, then it would be a simple matter for both Mr. Pantazopoulos and his wife to testify that any videotape depicting a man who looked like Mike Pantazopoulos with a mustache must, in fact be a tape of his brother, Tassos, from Greece. However, instead, the evidence was that photographs and videos might or might not be Mr. Pantazopoulos. There was no flat denial that it was in fact him. An exhibit was filed in which Mr. Pantazopoulos' lawyer confirmed his client's advice that Jim Pantazopoulos was not in the country in 1991, but Mike Pantazopoulos testified afterwards that he was in the country for 20 days. When the identity of the man in the videotape in 1991 came into question, it suddenly appeared that Tassos Pantazopoulos had been visiting in Canada for approximately 20 days.
Dr. Fung testified at the hearing. Dr. Fung was Mr. Pantazopoulos' family doctor at the same time as Mr. Pantazopoulos was seeing Dr. Vavougios. Dr. Fung saw the Applicant eight times in 1991, before he told him that he had been in an accident in December 1990. Prior to that, only Dr. Vavougios knew about the accident. This is a further example of the Applicant's selectivity in providing information. Mr. Pantazopoulos' denial of back and neck problems before the accident and his exaggeration when examined by Doctors Bayer and Houston add to my impression that his testimony is unreliable.
From 1991 to 1993, a major renovation was taking place in the Pantazopoulos home. Walls were knocked down and stairs removed. Mike Pantazopoulos denied that he worked on the home renovations. He claimed to have hired all the help or that his wife and children did the work. I find this evidence unworthy of belief. Mr. Pantazopoulos' trade, as well as commercial cleaning, was roofing and construction. Dr. Fung's notes in August 1991, and his testimony at the hearing, indicate that Mr. Pantazopoulos told him that he had been working at some construction. I find that the construction which Dr. Fung noted was likely the renovation that Mr. Pantazopoulos was performing in his own home.
I therefore find that not only is the Applicant not entitled to further weekly income benefits after July 31, 1992, he must repay benefits which he has received, in error, due to his fraud after April 28, 1991. The Insurer had agreed at the first mediation to pay the Applicant up to that date at $600 per week and was not seeking repayment prior to this time.
The Applicant has received $46,074.84 in weekly income benefits, but should only have received $9,600 in benefits to (16 weeks @ $600.00) to April 28, 1991. Accordingly, I find the Applicant must repay $36,474.84. Interest may be added to that amount according to the provisions of section 27 of the Schedule.
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:
(11) 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.
A number of decisions have denied expenses to Applicants based upon their fraud against their Insurer or the lack of credibility of the Applicant's evidence. I also decline, in this case, to exercise my discretion to award expenses to the Applicant.
In view of the amounts at stake with respect to repayment and expenses, the Insurer did not press vigorously for its assessment to be repaid under the provisions of section 282 (11.2) of the Insurance Act, as amended. I decline to exercise my discretion to order that the Insurer's assessment be repaid by the Applicant.
Order:
Mr. Pantazopoulos is not entitled to weekly income benefits after July 31, 1992.
The correct amount of weekly income benefit is less than $600, but because of the answer to question 3, it is not necessary to precisely calculate the amount per week.
The Insurer is entitled to be repaid under the provisions of section 27(1) of the Schedule, because of the fraud of the Applicant. The Applicant will repay all weekly income benefits paid after April 28, 1991, in the amount of $36,474.84, plus interest as provided under section 27(4) of the Schedule.
The Applicant is not entitled to his expenses of the arbitration.
K. Julaine Palmer
Arbitrator
Date