Financial Services Commission of Ontario

Commission des services financiers de lander

Neutral Citation: 1999 ONFSCDRS 115

Appeal P98-0005

OFFICE OF THE DIRECTOR OF ARBITRATIONS

MOTOR VEHICLE ACCIDENT CLAIMS FUND

Appellant

and

R.W.

Respondent

Before:

Susan Naylor, Director’s Delegate

Counsel:

Colin S. Jackson (for MVAC)

Sloan Mandel (for R.W.)

APPEAL ORDER

Under section 283 of the Insurance Act, R.S.O. 1990, c.I.8, it is ordered that:

1. The following paragraphs of the arbitrator’s order dated January 6, 1998, as revised on February 2, 1998, are confirmed:

Paragraphs 1 (rent), 2 (mandatory program fees), 3 (transportation expenses), 5 (social and physical rehabilitation expenses), 6 (telephone expenses) and 8 (special award).

2. Paragraph 4 (personal care and miscellaneous items) is revoked.

3. Paragraph 7 is rescinded and the following substituted:

R.W. is entitled to $172 for ink and speakers for his computer.

4. Paragraph 9 (interest) is rescinded and the following substituted:

R.W. is entitled to interest on the amounts owing pursuant to section 24 of the Schedule. The Motor Vehicle Accident Claims Fund is entitled to set off amounts paid pursuant to paragraph 4 and part of paragraph 7 of the arbitrator’s order, revoked herein.

5. Paragraph 10 (arbitration expenses) is confirmed.

6. R.W. is entitled to his appeal expenses.

June 23, 1999

Susan Naylor Director’s Delegate

Date

REASONS FOR DECISION

I. NATURE OF THE APPEAL

R.W. was 19 years old when he suffered a traumatic brain injury on June 21, 1991, while riding a motorcycle. His injuries are severe and lifelong. He now lives in a community-based group home as part of a supportive living program run by Brain Injury Community Re-Entry (Niagara) Inc. (“BICR”). The prognosis is that he will always require a supportive environment.

The appeal arises out of an arbitration order dated January 6, 1998, revised on February 2, 1998, requiring the Motor Vehicle Accident Claims Fund (“MVAC”) to pay certain amounts connected with R.W.’s participation in the BICR program. These expenses include his rent, various program charges, transportation costs and other miscellaneous items. The arbitrator ruled that MVAC had to pay these claims, also concluding that its refusal to do so had been unreasonable and that it was liable to pay a special award of $2,500, inclusive of interest.

After hearing the submissions of the parties, I confirmed the arbitrator’s order requiring MVAC to pay R.W.’s rent, his mandatory program fee, transportation expenses and charges for certain social and physical activities. I reserved my decision with respect to payment of personal care items, long-distance telephone expenses, computer-related expenses and the special award. This decision disposes of the outstanding issues and sets out my reasoning for dismissing the appeal in respect of the other items.

II. BACKGROUND

The agreed-to facts and the evidence were set out in some detail in the arbitrator’s decision. No transcript of the arbitration hearing is available, but there is no dispute regarding the specifics of the testimony presented. The arbitrator heard from R.W. and his mother. She also heard testimony from Christine Williams, the case facilitator at BICR, and Laurie McNight, Manager of Residential Services. MVAC did not file any reports or call any witnesses.

R.W. suffered a severe closed head injury in the accident that has left him with lifelong cognitive deficits relating to memory and attention span. His judgment, problem-solving skills, planning and execution abilities, impulse control, co-ordination and balance are all affected.

After the accident, R.W. received acute medical care at Sunnybrook Medical Centre. On arrival, his Glasgow Coma Scale score was 3. A CT scan showed bilateral intracerebral haematoma and brain stem haematoma. He remained in a coma for 5 days and experienced post-traumatic amnesia for approximately two months.

After the period of acute care, R.W. was sent to the United States for treatment, initially to the Health Care Rehabilitation Centre in Austin, Texas and then, in May 1993, to the Tangram Rehabilitation Network in San Marcos, Texas. The full cost of these programs was paid by OHIP. On August 26, 1996, five years after the accident, R.W. returned to Ontario after the Ministry of Health approved repatriation funding for his admission to the BICR residential program. Although he had made steady progress at Tangram, he continued to need a structured and stimulating rehabilitation program in a group home setting. BICR met those needs. As a not-for- profit agency dedicated to helping brain injured persons in the post-acute phase, it provides a continuum of care on a long-term basis that enables persons to move from supported group living to more independent arrangements over time, as they are able.

R.W. lives in a small community-based group home that is supported by BICR staff. OHIP pays a per diem rate covering staffing costs.¹ However, it does not cover the expenses of living in the residence. R.W. is responsible for these costs. They include his rent, a mandatory program fee, the costs of additional recreational and social activities arranged through the agency and transportation costs. I discuss these items in more detail below.

At the time of the accident, R.W. was operating a friend’s motorcycle which he was not licensed to drive. The vehicle was not insured, leaving his recourse to statutory accidents benefits against MVAC. The rules governing statutory accident benefits are set out in regulations, in this case, the Statutory Accident Benefits Schedule - Accidents before January 1, 1994, R.R.O 1990, Reg. 672 (“the Schedule”). Under these rules, R.W. is disqualified from weekly benefits because he was injured while operating a vehicle he was not legally authorised to drive. However, he remains eligible for medical, rehabilitation and care benefits.

MVAC’s position is that the expenses it has been ordered to pay are ordinary living expenses that R.W. would have incurred in any event and should be paid out of his own income. It argues that the charges are being mischaracterised as care, treatment or rehabilitation expenses, thereby circumventing the effect of the disqualification from income benefits. It also argues that the expenses involved are inadequately documented and insufficiently supported by medical evidence, and that R.W. failed to meet the onus of proof that they are reasonable in view of his rehabilitation needs.

III. STATUTORY REQUIREMENTS

Subsection 283(1) of the Insurance Act, R.S.O. 1990 c. I-8, as amended by the Insurance Rate Stability Act, 1996, S.O. 1996, c.21, section 39, provides that a party may appeal an order of an arbitrator only on a question of law. Since R.W.’s arbitration was commenced after November 1, 1996 when the new rule came into effect, the restriction applies to MVAC’s appeal.

The principles to be applied in construing the provisions of the Schedule are well-established. The legislative scheme is remedial and its provisions must be accorded a broad and liberal interpretation. Guaranteeing everyone injured in automobile accidents access to necessary and effective rehabilitation and care without undue delay is a fundamental objective of the scheme. However, rehabilitation and care benefits are not unlimited. The claim must fall within the scope of the Schedule and is subject to limits in time and amount. Medical-rehabilitation benefits and care benefits are subject to a ceiling of $500,000. In addition, medical-rehabilitation benefits are not payable beyond ten years or 20 years less the person’s age at the accident, if longer. Care benefits are subject to a maximum monthly cap of $3,000. More complete recovery is left to the tort system.

The relevant provisions are section 6 and 7. They state as follows:

Supplementary Medical and Rehabilitation Benefits

6.-(1) The insurer will pay with respect to each insured person who sustains physical, psychological or mental injury as a result of an accident all reasonable expenses resulting from the accident within the benefit period set out in subsection (3) for,

(a) medical, psychological, surgical, dental, hospital, chiropractic, nursing and ambulance services and the services of physiotherapists;

(b) prostheses, dentures, prescription eyewear, hearing aids and other medical or dental devices;

(c) rehabilitation, life-skills training and occupational counselling and training;

(d) transportation for the person to and from treatment, counselling and training sessions, including transportation for an assistant;

(e) home renovations to accommodate the needs of the insured person;

(f) other goods and services, whether medical or non-medical in nature, which the insured person requires because of the accident.

(2) The insurer will pay with respect to each insured person who sustains physical, psychological or mental injury as a result of an accident an allowance that is reasonable having regard to all of the circumstances for expenses actually incurred by a spouse, child, grandchild, parent, grandparent, brother or sister of the insured person in visiting the insured person during his or her treatment or recovery.

(3) For the purpose of this section, the benefit period is the longer of the two following periods calculated from the day of the accident and ending on the anniversary of the accident:

1. Ten years.

2. Twenty years less the age of the insured person on the day of the accident.

(4) Subject to subsections (5) and (6), the insurer, before making a payment for an expense under subsection (1), may require the insured person to submit a statement signed by the insured person's qualified medical practitioner or psychological advisor stating that the expense is necessary for the insured person's treatment or rehabilitation.

(5) A person qualified to practise as a chiropractor may sign a statement required under subsection (4) in respect of chiropractic services under clause (1)(a).

(6) A person qualified to practise dentistry may sign a statement required under subsection (4) in respect of dental services and dentures under clause (1)(a) and (b).

(7) In case of a dispute concerning an expense described in clause (1)(a), (b) or (d), the insurer will pay the expense pending resolution of the dispute.

(8) The maximum amount payable under this section is $500,000 with respect to each insured person.

Care Benefits

7.-(1) The insurer will pay with respect to each insured person who sustains physical, psychological or mental injury as a result of an accident, for the care, if any, required by the insured person,

(a) the reasonable cost of a professional caregiver or the amount of gross income reasonably lost by a person other than the insured person as a result of the accident in caring for the insured person; and

(b) all reasonable expenses resulting from the accident in caring for the insured person after the accident.

(2) The maximum amount payable per month under this section is $3,000 a month with respect to each insured person.

(3) The maximum amount payable under this section is $500,000 with respect to each insured person.

Exception

9.-(1) The insurer will not pay any portion of an expense referred to in subsection 6(1) or (2) or subsection 7(1) for a service that is reasonably available to the insured person under any insurance plan or law or under any other plan or law that will pay the expense.

(2) The insurer will pay benefits under this Part even though the insured person is entitled to or has received benefits under an Act administered by the Ministry of Community and Social Services for Ontario or under similar legislation in another jurisdiction.

The Schedule distinguishes care benefits from medical and rehabilitation benefits. A number of arbitration decisions have indicated that the dividing line between the services and goods covered by the two provisions is not clear-cut, but that, broadly speaking, section 6 is aimed at active treatment and rehabilitation, while the focus of section 7 is on long-term care needs, such as attendant care in an institution or in the home.² Under section 9, both care benefits and rehabilitation benefits are secondary to OHIP and certain other payment sources, but are not excess to benefits available from the Ministry of Community and Social Services.

IV. ANALYSIS AND CONCLUSIONS

1. RENT

The arbitrator ordered MVAC to pay R.W.’s share of the rent, ($500 a month), under section 7(1)(b). This was because she found his residence at the BICR group home integral to his receiving the 24 hour support he needed.

MVAC submits that OHIP funding pays in full for the care and rehabilitation component provided through BICR’s staff, and that R.W.’s accommodation costs are ordinary living expenses. Its position is that R.W.’s rent is not for care and is not a reasonable expense resulting from the accident.

I agree with the arbitrator that there is no dichotomy between the cost of care and the cost of accommodation. How the institution characterises the service is not determinative. An expense is recoverable under section 7(1)(b) if two conditions are met:

1. it is a reasonable expense resulting from the accident in caring for the individual, and

2. the care is required because of the accident.

As the arbitrator found, R.W. needs to live in the type of structured, supportive, communal environment that BICR offers. He needs the guidance, support and supervision provided by the BICR staff. He cannot get this unless he lives in residence. His residence in BICR’s group home is intertwined with the provision of the support he needs and the rehabilitation and counselling provided. If he cannot pay for his accommodation, ultimately, he cannot stay at the home. His need to live at the BICR group home is solely attributable to the accident. It follows that the cost of his accommodation is as much an expense for care required as a result of the accident as is the cost of staffing or programming.

MVAC argues that R.W.’s situation is similar to the case of someone receiving round-the-clock home care from an attendant care-giver. An insurer would be responsible for the costs of attendant care, but not for the person’s accommodation costs. However, the situation is not parallel. The arbitrator found that R.W.’s residence at BICR is an integral aspect of the overall care and rehabilitation being provided by the agency and required by the nature of his injuries. I agree with her findings.

MVAC argues that the fact accommodation costs are segregated from support costs indicates they are not a core component of the latter. It distinguishes the reasoning in Ducharme and Gerling Global Insurance Company (OIC A-013316, July 25, 1995) on this basis. In Ducharme, the applicant was cared for in a long-term residential facility. There was a single fee for occupancy. The insurer only paid the difference between the facility’s fee and the rent the applicant was paying before the accident. The arbitrator concluded that the expense of residence was an expense of care, that the applicant’s condition required that he reside in the care facility and that the full expense was therefore reasonable and required without any deduction for what he would have paid for accommodation but for the accident. The key to the decision, in my view, is that the applicant lived in the facility because he needed care; it was not, as MVAC suggests, that the nature of the billing arrangements did not allow one to be segregated from the other. The arbitrator’s reasoning, with which I agree, is therefore applicable to this case.

MVAC submits that the arbitrator’s decision to order it to pay R.W.’s accommodation expense was inappropriately influenced by her view that the insurer was “benefiting” from the fact that the Ministry of Health was partially funding his care at BICR since MVAC would have to pay the full costs of his care if he were forced to leave.

Reading the arbitrator’s remarks in context suggests that they were more in the nature of a reaction to MVAC’s characterisation of payment of the cost of residency in a group home as a “windfall.” However, I would agree that to the extent her comments can be read in the way MVAC suggests, they are not apposite. Section 9(1) relieves an insurer from responsibility for paying expenses for services that are paid for by OHIP. The effect of OHIP’s payment is simply a function of the operation of the rules. It is an error to view it as a subsidy that broadens an insurer’s obligations in other respects. Correspondingly, however, as the arbitrator notes, the services for which OHIP pays do not define the scope of an insurer’s obligations to pay for rehabilitation and care services under the Schedule.

Underlying MVAC’s submission is its view that it is being asked to pay, at least to some extent, for accommodation costs that R.W. would have had to incur regardless of his injuries.

The composite cost of R.W.’s care at BICR includes the fixed cost of his accommodation at the BICR home. It cannot be assumed that R.W. would have to incur accommodation costs no matter what. In this case, the evidence suggests otherwise: that if R.W. was forced to leave BICR because he could not afford to stay, he would live at home with his mother and would not pay rent. However, there is a more fundamental flaw in MVAC’s reasoning. It assumes that a care or rehabilitation benefit cannot be reasonable or required as a result of the accident unless it matches the financial loss sustained. It has been emphasised in many cases that the Schedule is not designed to replicate the individualised assessment of loss available in the tort system, which also provides much broader scope for compensation. The Schedule’s purpose is more modest but more immediate - to ensure that those injured have access to necessary care and rehabilitation quickly, without undue complication. The need is all the more urgent in cases of catastrophic injuries as in this case. The test to be determined is whether the expenses are for care, the care is required because of the accident and the cost is a reasonable expense resulting from the accident. The application of these criteria turn on the particular facts in each case. However, in my view, once the care has been found to be reasonable and required in the particular case, the test is met. Not only is there no reason to interfere with the arbitrator’s findings in this regard, I agree with them. Therefore, this aspect of the appeal fails.

2. MANDATORY PROGRAM FEES

BICR charges its residents a mandatory program fee, which varies depending on the level of staff support required. In R.W.’s case, the fee was $200 a month up to March 31, 1997, during the initial transitional phase when he needed continuous staff attendance, and $100 a month thereafter, when he was able to attain a greater level of independence. The fee is compulsory. If it is not paid, the person cannot remain in BICR’s program. The arbitrator held that the fee is also part of the costs of caring for R.W. and payable under section 7.

MVAC argued that R.W. was involved in an extensive treatment regime that provided him with a level of treatment and rehabilitation reasonable to his needs. It objected to a lack of documentation explaining the basis of the fee and how it was spent in R.W.’s case. MVAC did not take issue with the arbitrator’s finding that the cost is properly considered under the category of a section 7 expense rather than a section 6 expense. Therefore, I will not address this issue further.

The arbitrator found - and MVAC does not dispute - that the residential program offered at BICR meets R.W.’s treatment needs. The program itself was found to be necessary. Mandatory fees that must be paid as a condition of participating in a residential program should be viewed, generally, as a necessary and reasonable expense resulting from the accident. This is the starting point of the analysis.

There is no suggestion in the evidence that the fee is unrelated to the objectives of the overall program. Ms. Williams, R.W.’s case facilitator, testifies that the mandatory program fee goes towards helping fund residents’ access to a full range of vocational, social and community activities necessary for rehabilitation. She provided examples of the kinds of expenses and activities that the fee was able to cover. In my view, it is not realistic or reasonable for MVAC to expect a more detailed accounting of precisely how the fee is allocated or its value-for-money in an individual case. It is enough that R.W. is required to pay it as a resident of the facility. Therefore, this aspect of the appeal fails.

3. TRANSPORTATION EXPENSES AND SOCIAL AND RECREATIONAL PROGRAM COSTS

R.W.’s rehabilitation planning is oriented towards re-integrating him into the community, successfully engaging him in vocational, social, and life-skills activities that foster his autonomy, self-esteem and responsibility.

R.W. currently has a part-time supported work placement at a local restaurant. Before this, he completed a training course in food preparation. He is going to night school studying psychology. In the past, he has volunteered at a residential home for adults with physical disabilities and still helps out with BICR programs. He regularly attends Alcoholics Anonymous and Narcotics Anonymous meetings. He goes to exercise classes at the YMCA several times a week, attends youth functions and participates in other recreational activities in the community. He is encouraged to develop life skills activities such as cooking, budgeting, banking, grocery shopping and using public transportation. The arbitrator found that all R.W.’s activities were geared to his vocational, social and physical rehabilitation. This finding is clearly supported on the evidence.

According to the arbitrator’s findings, R.W. used a variety of means of transportation to get him to and from his various activities and appointments, becoming more self reliant as time and his comfort-level allowed. For the first few months, BICR staff would drive him to where he needed to go. After he had been at BICR for some months, he was given a transit bus pass, starting in January 1997, to encourage him to be more independent. However, he continues to require some assistance, depending on his level of independence and need for support.

The arbitrator ordered MVAC to pay the mileage costs of BICR staff, based on an estimated $25 a month. She also awarded R.W. the costs of the monthly bus pass, a further $25 a month. She characterised these costs as transportation expenses for treatment, counselling and training sessions under section 6(1)(d) of the Schedule. If there is a dispute over such expenses, they must be paid in the interim under section 6(7). Failure to do so may result in a special award, as was argued here.

BICR has a recreational club for residents and organises special outings, such as to the zoo and the botanical gardens. It also arranges monthly dinners at local restaurants. Residents have to pay the costs of these outings themselves. R.W. claimed the estimated costs of such additional social and recreational activities at $80 a month as a rehabilitation expense. He also claimed $10 a month in fees for his YMCA program. The arbitrator accepted these claims under section 6(1)(c).

These charges were in addition to the mandatory program fee which, according to Ms. Williams’ testimony, covered the first $40 of staff mileage costs as well as various programs and activities.

Section 6 obliges insurers to pay supplementary medical and rehabilitation benefits. It lists the nature of the services and products that are covered, requiring insurers to pay for all reasonable expenses resulting from the accident for such items. The list includes, under section 6(1)(f), other goods and services not specifically categorised, if they are required because of the accident. Section 6(4) allows an insurer, before paying an expense, to require the insured to provide a statement from a medical practitioner or psychological advisor that the expense is necessary for the person’s treatment or rehabilitation.

MVAC complained that no specifics of the claimed expenses were provided and no formal claim was ever submitted. The trips taken and distance travelled were not itemised. Mileage costs and the costs of the social activities were only an estimate. No documentation backing up any of the expenditures was provided.

MVAC’s complaints have some validity. It was being asked to commit substantial funding, with little detail provided in advance of the hearing and changing listings of the amounts and categories of expenses in issue. However, the process must be flexible enough to accommodate the urgency of the needs of persons suffering from catastrophic injuries as in this case.

The request for funding, which included an outlined service proposal, was made in the context of the immediate need to make arrangements for R.W.’s homecoming to Ontario. The Commission’s dispute resolution process was engaged quickly. During the course of the process, MVAC would have had an opportunity to discuss, and clarify, the expenses.

A pre-hearing took place on April 2, 1997, some eight months after R.W. had started at BICR. Ms. Williams was present at the pre-hearing specifically to address questions concerning BICR’s programs. At the pre-hearing and again shortly before the hearing, R.W. provided MVAC with a list prepared by BICR of estimated expenses. Although the categories and amounts of expenses listed were not identical, they provided a reasonable indication of the nature of the claims and amounts involved. The expenses in issue were also clarified and confirmed by the arbitrator at the hearing. There was no suggestion that MVAC was taken by surprise by any of the expenses in issue. In view of the above, I conclude that MVAC had sufficient notice of the expenses in issue and was not prejudiced in the preparation of its case.

BICR staff also were on hand at the hearing to answer questions with respect to the expenses. They testified about the programs R.W. was involved in and the related costs, and were cross- examined on their evidence.

I agree with the reasoning in Gaba and Allstate Insurance Company of Canada (OIC A-000624, August 21, 1992), adopted in other cases, that the Schedule does not contemplate imposing an unduly onerous accounting burden on applicants. It requires a degree of substantiation that is sensible in, and sensitive to, the particular circumstances. It must take account, foremost, of the reality of an applicant’s medical condition. This case involves a severely brain-injured individual residing in a care facility. I accept that it would be unreasonable and unfeasible to require him to keep detailed track of his day-to-day transportation usage. It would also be unduly onerous to expect a non-profit agency with limited resources to do the same. Payment of such items in the form of a monthly allowance makes a great deal of sense in the circumstances. Such an arrangement is contemplated in respect of visiting expenses under subsection 6(2) and can be accommodated, in an appropriate case, under other subsections.

I also note that MVAC did not ask for additional proof of the amount of expenses before the hearing. It denied liability, maintaining this position not because it questioned the estimated costs involved, but because it did not regard them as reasonable rehabilitation expenses reasonably related to the accident.

The arbitrator ordered MVAC to pay for the monthly bus pass on the basis that it was provided to facilitate R.W.’s re-integration into the community. MVAC argues that the expense does not fall under section 6(1)(d), which covers transportation to and from “treatment, counselling and training sessions, including transportation for an assistant.”

The transportation expenses were incurred for a variety of activities, all of them found to have a broad rehabilitative purpose. While some of the travel may have involved trips to the doctor or attending training programs, I agree with MVAC that, in including within the scope of section 6(1)(d) transportation for purposes such as recreational activities or grocery shopping, the arbitrator may have cast too broad a net. Even if this is so, however, I find that the expenses fall within section 6(1)(f) in any event. In Plows and Jevco Insurance Company (OIC A- 000175 and A-000588, January 16, 1992) upheld (OIC P-000175 and P-000588, May 15, 1992) it was held that recovery of transportation expenses is not limited to expenses under subsection 6(1)(d). In the same decision, it was also held that rehabilitation includes measures having as their objective the promotion of independence and self-sufficiency. In my view, this answers MVAC’s objection.

MVAC argues there was insufficient evidence, including medical evidence, to support the claim. It suggests that, given R.W.’s busy rehabilitation schedule, his involvement in other organised social and recreational programs could not be viewed as a necessary or reasonable expense.

I do not find MVAC’s submission persuasive. Ms. Williams testified as to the important rehabilitative purpose served by recreational and social activities. It was noted that R.W. had difficulty organising his own time. The professionals at both Tangram and BICR agreed on the need to keep R.W. fully engaged as a rehabilitative goal.

R.W.’s rehabilitation plan was specifically approved by Dr. Proulx, a neuropsychologist who assessed him on several occasions. In a letter dated October 29, 1997, he fully endorsed the individual service plan that had been developed for R.W., that included details and recommendations related to the activities in issue. He reported that R.W. had made significant gains within the BICR program and he strongly recommended that it be maintained.

In view of the above, I conclude that the arbitrator’s order was justified on the evidence before her.

4. OTHER ITEMS

MVAC complains that no medical evidence was called to support the necessity of certain other expenses. In awarding these expenses, the arbitrator relied on testimony from Ms. Williams, R.W.’s case facilitator.

R.W. states that there was an agreement between counsel that Ms. Williams’ testimony would be sufficient proof and that, for this reason, Dr. Proulx was not called to testify. He states that MVAC never asked for a statement from a qualified practitioner that the expenses were necessary, and that it only objected to the lack of medical evidence on appeal. MVAC’s lawyer disagrees with this interpretation of his actions. He stated that he simply waived the right to cross- examine Dr. Proulx, whose reports were filed, and that the necessity of the expenses is not a new issue.

R.W.’s submissions are not a complete explanation for the absence of medical evidence. The pre- hearing letter dated April 2, 1997 confirms that MVAC asked for medical support for the claims. The relationship between the expenses claimed and R.W.’s rehabilitation requirements arising from the accident has been an issue all along. It was ruled on by the arbitrator. An arbitrator’s findings of fact and the conclusions he or she draws must be must reasonably supported by the evidence.

On this basis, I have allowed MVAC’s appeal with respect to payment of laundry detergent and personal care items such as body lotion, soap and shaving lotion, as well as the replacement clothing allowance and the costs of confectionary. The total estimated cost was $95 a month. In allowing the claims, the arbitrator relied on testimony given by R.W.’s mother and Ms. Williams. She accepted their evidence that R.W. had developed a sensitive skin condition since the accident and required the lotion to treat it. She also found that he had developed a strong obsessive- compulsive behaviour pattern regarding personal hygiene, which meant he went through washing products and personal care items at a much higher rate than normally expected, and needed to replace clothing more quickly. Finally, she concluded that he needed gum and candy to help him relax. She concluded that these expenses were all required as a result of the accident.

The arbitrator’s sympathy is understandable but, in my view, she went too far in drawing conclusions about the nature of R.W.’s condition and its relationship to the accident without the benefit of evidence from appropriately qualified professionals. No medical evidence was called supporting the view that R.W. had developed a strong obsessive-compulsive behaviour pattern or that his need for gum and candy resulted from the accident or was a reasonable rehabilitation requirement. None of the records from any of the facilities he attended made mention of such matters, with the exception of a single entry in the records of a family doctor, Dr. Dux, in late December, 1994, who provided moisturiser for a dry skin condition but did not give any further information about it. Therefore, this order is reversed.

I do not take the same view of the telephone charges relating to long-distance calls to residents at Tangram, R.W.’s former facility. Ms. Williams testified that maintaining the continuity of contact with fellow-residents at Tangram who are coping with similar problems is important to R.W.’s rehabilitation. BICR’s written plans identify the value of maintaining such relationships as a goal. MVAC had an opportunity to cross-examine Dr. Proulx, who endorsed BICR’s planning, had it wished to do so.

The arbitrator allowed the cost of a set of speakers and replacement ink cartridges for a computer system that had been bought for R.W. while he was at Tangram. On the recommendation of his doctors, MVAC paid for the computer system, which included a printer and software. There was evidence that R.W. continued to benefit from using the computer system. It stands to reason that a printer requires ink to be functional and software with a voice program needs audio capacity. Given the evidence, which includes the Tangram records, I am not satisfied that MVAC has demonstrated that the arbitrator’s findings lack the necessary evidentiary foundation.

However, I would depart from the arbitrator’s order respecting payment of the cost of renewing the warranty on the computer purchase ($366.69). R.W. never renewed the warranty and once it had expired, had no option of doing so. In refusing to pay to renew the warranty, MVAC takes the risk that it would be required to pay more costly repairs in the event of a problem. However, it is a considerable stretch to characterise the abstract cost of renewing a warranty in such circumstances as a required expense. The arbitrator did not specifically address the warranty in her reasons, and in the circumstances I cannot be satisfied she turned her mind to the issue. MVAC therefore succeeds on this aspect of the appeal.

5. SPECIAL AWARD

The arbitrator awarded a special award against MVAC under section 282(10) of the Insurance Act on the basis that it acted unreasonably in refusing to pay R.W.’s expenses for rent and the mandatory accommodation fee, as well as the transportation expenses and the YMCA program fees.

In Maas and State Farm Automobile Insurance Company, (OIC P96-00080, December 11, 1997), Director’s Delegate Draper commented on the nature of a special award. He noted that while it is not strictly discretionary, a finding of unreasonableness is highly dependent on the arbitrator’s view of the evidence. Therefore, even before appeals were limited to questions of law, an arbitrator’s finding with respect to reasonableness was given substantial leeway on appeal.

Unless it is shown that there is a clear error in the arbitrator’s approach amounting to an error in law, or there is a basis to conclude that the process was unfair to a party in some way, an order under section 282(10) will not be disturbed.

MVAC argued that the basis of the award was flawed because the arbitrator’s finding was influenced by her view that MVAC benefited from OHIP’s funding of the BICR program. It suggested that she therefore imposed a higher obligation on the insurer with respect to the unfunded amount.

As I have previously said, I view her comments more in the nature of a response to MVAC’s characterisation of the payment of residency costs as a “windfall.” In any event, however, a review of her decision in its entirety indicates that she weighed a number of factors in reaching the conclusion that MVAC had acted unreasonably. The severity of R.W.’s condition and the immediacy of his need for a residential program were obviously considerations. The arbitrator also had the benefit of evidence of the potential consequences of non-payment. It indicated that R.W. had built up substantial arrears and that his inability to meet his commitment to pay the mandatory fees placed his continued participation in the program ultimately in jeopardy. The arbitrator was entitled to consider whether the strength of MVAC’s case justified exposing R.W. to the risks of non-payment.

MVAC’s refusal to pay even the modest costs of an exercise program at the YMCA or any part of R.W.’s transportation expenses at BICR also reinforced her view that MVAC had adopted an unreasonable position.

In view of the evidence, it cannot be said that her finding is unsupportable as a matter of law.

IV. Appeal Expenses

R.W. was substantially successful in resisting MVAC’s appeal. He is entitled to his reasonable appeal expenses.

June 23, 1999

Susan Naylor Director’s Delegate

Date

Footnotes

1. 1According to Exhibit 1, OHIP’s funding commitment in R.W..’s case involved 16 hours of care a day at $23.00 per hour (monthly cost $11,040) for the first six months, and 10 hours a day at a monthly cost of $6,900, thereafter.
2. 2Malfitano and CAA Insurance Company (OIC A-007490, August 4, 1994), McMaster and Dominion of Canada General Insurance Company, ( OIC A-006025, October 26, 1994); Ducharme (cited).