Neutral Citation: 1996 ONICDRG 10
OIC A96-000394
ONTARIO INSURANCE COMMISSION
BETWEEN:
SUSAN COLE
Applicant
and
ALLSTATE INSURANCE COMPANY OF CANADA
Insurer
DECISION
Issues:
The Applicant, Susan Cole, is the mother of Stephanie Harroun, a minor, who was injured in a motor vehicle accident on June 17, 1995. Ms. Cole, on behalf of her daughter, applied for and received statutory accident benefits from Allstate Insurance Company of Canada ("Allstate"), payable under the 1994 Schedule.1 Ms. Cole also applied for rehabilitation benefits to accommodate Stephanie's housing needs. The parties differ as to the extent of Allstate's obligation in this regard. The parties were unable to resolve their dispute through mediation and Ms. Cole applied for arbitration under the Insurance Act, R.S.O. 1990, c.I.8, as amended.
The issues in this hearing are:
Is the townhouse in which Stephanie Harroun lived at the time of her accident, her "existing home" for the purposes of subsection 41(1) of the 1994 Schedule?
If the townhouse is Stephanie Harroun's "existing home," is Allstate's obligation towards the purchase of a new home restricted to the value of the renovations to the townhouse that would have been required to accommodate Stephanie Harroun's needs?
Result:
The townhouse in which Stephanie Harroun lived at the time of the accident is her "existing home" for the purposes of subsection 41(1) of the 1994 Schedule.
Allstate's present obligation towards the purchase of a new home is restricted to the value of the renovations to the townhouse that would have been required to accommodate Stephanie Harroun's needs.
Hearing:
The hearing was held at the offices of the Ontario Insurance Commission in North York, Ontario, on October 17, 1996, before me, Lawrence Blackman, Arbitrator.
Present at the Hearing:
Applicant:
Susan Cole
Ms. Cole's Representatives:
James R. Howie
Barrister and Solicitor
Adam Wagman
Barrister and Solicitor
Allstate's Representative:
Ian D. Kirby
Barrister and Solicitor
Allstate's Officer:
Wanda Rumsam
Also attending at the hearing was the Insured, Miss Stephanie Harroun.
Evidence and Findings:
Agreed Facts:
The parties agree on the following facts.
Miss Stephanie Harroun was injured in a motor vehicle accident on June 17, 1995. Her injuries included a spinal cord injury which has left her paralysed from the lower chest down. Stephanie was 12 years old at the time of the accident.
At the time of the accident, Stephanie was living in a townhouse in Georgetown, Ontario (the "townhouse") with her mother, Ms. Susan Cole, and her mother's husband, Mr. Danny Cole. The townhouse had been purchased by Mr. Cole prior to the accident.
Stephanie's natural father lives in Edmonton, Alberta.
In December 1995, Stephanie was released from hospital to hotel accommodation. She then returned to the townhouse for five or six weeks. During this period, Ms. Cole separated from Mr. Cole. Stephanie and her mother moved into their present, temporary, rental accommodation.
It is specifically agreed that Stephanie's present accommodation is acceptable only on a short-term basis, and that it is not reasonable to renovate the townhouse because:
The cost of the required renovations is close to the market value of the townhouse.
The marital breakdown of Ms. Cole and Mr. Cole excludes the townhouse as a viable housing option for Stephanie.
In this case there is no dispute as to Stephanie's entitlement to a new home. The dispute is as to Allstate's required contribution towards the purchase of a new home.
The Issues:
The issues in this hearing pertain to whether Allstate's obligation towards the purchase of a new home for Stephanie is restricted by the provisions of subsection 41(1) of the 1994 Schedule. The subsection states:
41.—(1) If it is more reasonable to purchase a new home to accommodate the needs of an insured person than to renovate the insured person's existing home, the insurer shall contribute to the cost of a new home in an amount equal to the value of the renovations to the existing home that would have been required to accommodate the needs of the insured person.
The Applicant maintains that subsection 41(1) only applies if the "insured person" has an ownership interest in the "existing home." The Applicant argues that as Mr. Cole was the owner of the townhouse in which Stephanie lived at the time of the accident, Stephanie, the "insured person," did not have an "existing home" at the time of the accident. The Applicant therefore submits that subsection 41(1) does not restrict Allstate's general rehabilitative obligation under the 1994 Schedule.
Allstate however submits that when the car accident occurred, Stephanie was on her way "home" to the townhouse. When she was released from hospital, she eventually went "home" to the townhouse. Allstate therefore argues that the townhouse was Stephanie's "existing home" at the time of the accident, and is her "existing home" for the purposes of subsection 41(1) of the 1994 Schedule. As it is more reasonable to purchase a new home to accommodate Stephanie's needs than renovate the townhouse, Allstate submits that