Financial Services Commission

Commission des services financiers de lander

Neutral Citation: 1999 ONFSCDRS 168

Appeal P96-00050

Appellant

and

Respondent

Before:

Nancy Makepeace, Director's Delegate

Counsel:

Frank A. Sabetti (for Mr. Movahedi)

Todd J. McCarthy (for State Farm)

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

The appeal is allowed and the arbitration order, dated April 29, 1996, is rescinded.
Unless the parties agree otherwise, a new hearing will be held before another arbitrator.
State Farm shall pay Mr. Movahedi's reasonable appeal expenses.

September 1, 1999

Nancy Makepeace Director's Delegate

Date

Mr. Movahedi appeals from the arbitration order, dated April 29, 1996, denying his claim for weekly income benefits after September 3, 1993. Although the arbitrator also made other orders, they were not appealed by either party.

Mr. Movahedi was broadsided on the driver's side while driving his taxicab through an intersection in downtown Toronto on February 26, 1993. He was taken by ambulance to St. Michael's Hospital, where he complained of neck and low back pain and reported that he hit his head on the roof of the car. X-rays taken that day of his neck and back were essentially normal. He was discharged with a prescription for Tylenol 2. Two days later, he returned to the hospital complaining of increasing back pain radiating to his legs. Mr. Movahedi's neck and low back symptoms have persisted. He also complains of headaches, temporomandibular jaw ("TMJ") syndrome, depression, poor sleep, poor concentration and memory problems. Despite treatment with physiotherapy, chiropractic therapy, analgesics, anti-inflammatories, anaesthetic injections, anti-depressants and tranquillizers, Mr. Movahedi claims he has not been able to return to work. His main complaints are severe low back pain radiating to his legs, the right more than the left, neck pain and depression.

At the arbitration hearing in October 1996, Mr. Movahedi claimed that he cannot work as a taxi driver because he cannot sit for more than 10 or 20 minutes, has difficulty getting into and out of a car, cannot turn his head to check over his shoulder, cannot lift or carry things, cannot concentrate and does not feel good about driving. He also claims he cannot stand or walk for more than 10 or 20 minutes.

Dr. M. Boozary, Mr. Movahedi's family doctor, has referred him to several specialists — Dr. Raphael K. Chow and Dr. A. Kachooie, physiatrists, Dr. F. Shahidi, a chiropractor, Dr. Bernard Schacter and Dr. Mahmood Fazl, neurosurgeons, Dr. Ezra Silverstein, an orthopaedic specialist, Dr. Peter Bastian, a specialist in temporomandibular joint disorders, and Dr. M. Zare-Parsi, a psychiatrist.

In the fall of 1993 and early 1994, a CT scan and CT myelogram revealed a bulging annulus causing spinal stenosis (narrowing of the nerve opening) at L3-4 and L4-5. Mr. Movahedi claims, supported by Dr. Schacter, that this explains his continuing low back and leg symptoms. State Farm required Mr. Movahedi to be examined by Dr. James K. Houston and Dr. Hugh U. Cameron, orthopaedic surgeons. It was their view that Mr. Movahedi's spinal stenosis was not clinically significant and that his symptoms were those of soft tissue injury to the neck and back complicated by non-organic factors. Dr. Silverstein agreed.

The arbitrator found that Mr. Movahedi had neck and back pain before the accident, and that his ongoing pain complaints after the accident were not "explained by objective, physiological findings." He also concluded that Mr. Movahedi's psychological problems were not the result of the accident, but related to a pre-existing drinking problem and unrelated stressors after the accident. The arbitrator then turned to the issue of credibility. He did not find Mr. Movahedi credible based on a number of inconsistencies in the evidence. He concluded, "even if I were to believe Mr. Movahedi's subjective complaints of pain, I am not persuaded by the evidence that the pain is severe enough to render him substantially incapable of performing his essential tasks."

A. Scope of the Appeal

As Mr. Movahedi filed his application for arbitration before November 1, 1996, this appeal is not restricted to questions of law. However, the role of an appeals adjudicator in reviewing findings of fact is limited to determining whether the arbitrator "made some serious error, such as ignoring material evidence, considering irrelevant factors or reaching findings that are unsupported on the evidence."¹

B. Overview

This is a difficult case. I find that there was sufficient evidence to conclude, as the arbitrator did, that Mr. Movahedi sustained a soft tissue injury without neurological involvement. However, that does not end the matter. As the arbitrator acknowledged, "It is possible that a person could have pain in the complete absence of any physical findings." In such cases, the insured person's credibility is an important factor because his doctors and the arbitrator must rely to a great extent on his subjective reports of pain and functional limitations. The arbitrator found Mr. Movahedi not to be credible because of a number of discrepancies in the evidence. His credibility findings are at the heart of his decision. Unfortunately, several of them are based on factual errors, undermining the decision.

C. Pre-accident Problems

The arbitrator's most serious error relates to his finding that Mr. Movahedi suffered from pre-accident neck and back problems. He based this finding on two pieces of evidence: a note in Dr. Boozary's records dated April 22, 1992, and a comment in the emergency records of St. Michael's Hospital made on the day of the accident.

Dr. Boozary's clinical notes and records do not include an entry for April 22, 1992. In fact, the last time Mr. Movahedi saw Dr. Boozary before the accident was on May 21, 1991.² However, on April 26, 1991, Dr. Boozary noted that Mr. Movahedi complained of a "neck posterior and scalp" problem. The words following this reference are illegible, so it is not possible to determine the nature of the neck problem. There is no reference to a back problem. Dr. Boozary stated in his reports that Mr. Movahedi did not suffer from neck or back problems before the accident.

Following the arbitration decision, Dr. Boozary prepared a note stating that he did not see Mr. Movahedi on April 22, 1992 or at any time in 1992.³ State Farm objected to the admission of this fresh evidence on appeal, and I reserved my ruling on the point. I admit the note, which was prepared in response to an error the parties could not reasonably have been expected to anticipate, and which relates to an important finding underlying the arbitrator's adverse assessment of Mr. Movahedi's credibility. As counsel for State Farm pointed out, the note in any event merely confirms Dr. Boozary's reports that Mr. Movahedi did not complain about neck or back problems before the accident.⁴

The emergency record from St. Michael's Hospital the day of the accident indicates that Mr. Movahedi complained that he had low back pain prior to accident but it was "much worse now." At the arbitration hearing, Mr. Movahedi denied that he had low back pain before the accident. He testified that the reference in the hospital notes referred to kidney pain he experienced 5 or 6 days before the accident.⁵ I find it was open to the arbitrator to reject this explanation, for which no corroborating evidence was given.

The arbitrator found that while this evidence was "not sufficient to establish that Mr. Movahedi's pain was caused by a pre-existing stenosis," it warranted the conclusion that he suffered from pre-accident neck and back pain. However, it was mainly on the basis of this finding that the arbitrator rejected Dr. Schacter's opinion that Mr. Movahedi's spinal stenosis became symptomatic as a result of the accident. The arbitrator did not address the question whether Mr. Movahedi's pre-existing neck and back symptoms got worse after the accident and, if so, whether the accident "significantly contributed" or "materially contributed" to the aggravation of symptoms.⁶ The omission is troubling because the arbitrator accepted Mr. Movahedi's evidence that he worked long full-time hours as a taxi-driver before the accident.

The arbitrator found Mr. Movahedi's "adamant denial of any pre-existing problems to be a factor that reflects adversely on his credibility." This credibility finding is undermined by the error in its factual foundation. Moreover, the arbitrator seems not to have considered innocent explanations for any discrepancy — the lapse of time, or the minor nature of any pre-accident problems.

I have similar concerns about the arbitrator's finding with respect to Mr. Movahedi's psychological condition before the accident. The arbitrator stated that Mr. Movahedi denied pre-accident depression and attributed his drinking, relationship difficulties and suicide attempt to the accident. Mr. Movahedi submits on appeal that he did not deny pre-accident emotional problems, but rather admitted that he felt home sick periodically and was upset when his father died.⁷ I find no error in the arbitrator's characterization of this response as a denial of a pre-accident problem with depression. Moreover, I find no error in the arbitrator's finding that Mr. Movahedi had a drinking problem before the accident.⁸ However, the only evidence of pre-accident depression is Dr. Boozary's note of April 26, 1991, almost two years before the accident. In any event, there is no evidence that any pre-accident problems with depression or alcohol abuse affected Mr. Movahedi's ability to work. The arbitrator did not make a finding as to the severity of these problems before the accident or whether they were exacerbated as a result of the accident. Accordingly, the arbitrator's adverse credibility finding lacks its necessary factual foundation and cannot stand.

These errors seriously undermine the arbitrator's decision.

D. Surveillance and hearing observation evidence

In finding Mr. Movahedi not to be credible, the arbitrator also relied on a surveillance videotape taken over three days in August 1993. It shows Mr. Movahedi driving briefly on August 10, walking to a restaurant, sitting down for a meal and walking home on August 14, and walking to a donut shop, sitting for a short time and returning home on August 26, 1993. Mr. Movahedi submits that the surveillance evidence does not contradict his statements about his abilities and does not show he can work.

The arbitrator stated that in cross-examination Mr. Movahedi admitted walking from his home to the restaurant "about half a mile away" and then returning home after a meal. On review of the transcript, I find that Mr. Movahedi neither admitted nor denied the suggestion.⁹ When State Farm's counsel returned to the issue a third time, Mr. Movahedi testified that the distance between his home and the restaurant was "not even 200 metres. After my house and my apartment there is a church, and then two apartment buildings and then there is a restaurant." I am in no worse position than the arbitrator to assess the videotape evidence. It shows Mr. Movahedi walking very slowly for a period of 5 minutes, then returning home after his meal. Based on his pace, the duration of the walk and the background buildings, I find that the arbitrator erred in rejecting Mr. Movahedi's evidence about the distance. The distance to the donut shop is even shorter, and the walk lasted about 3 minutes. Moreover, I observe that Mr. Movahedi walks very slowly, and stops several times, periodically putting his hands on his hips and lower back.

At the hearing, Mr. Movahedi testified that he could walk for only about 10 minutes. He explained the surveillance evidence by testifying that he only walked when he could not afford a taxi, or when he felt better after taking medication, or when he forced himself on doctor's advice. It was open to the arbitrator to reject these explanations, but reasons should have been given for doing so. In any event, the surveillance presents, at most, a weak contradiction in the evidence, given its short duration and Mr. Movahedi's observed activity level.

The tape also shows Mr. Movahedi sitting in a restaurant for about 6 minutes on August 14, and in a donut shop for about 7 minutes on August 26, without any sign of discomfort. While this evidence is suggestive, it does not contradict Mr. Movahedi's claim to be able to sit for no longer than 10 or 20 minutes. It does not show that Mr. Movahedi can sit in a taxi all day.

The arbitrator's adverse credibility assessment also depended on his finding that Mr. Movahedi acknowledged sitting for about an hour and twenty minutes during the hearing "without standing up or changing his position." Mr. Movahedi submits on appeal that he asked the arbitrator if he could stand early on the morning of the first day of the hearing,¹⁰ and on re-examination, he testified that he "took a lot of medications to be able to sit here."¹¹ Moreover, he submits that his ability to sit through his arbitration hearing is not indicative of his ability to work full-time as a cab driver. The arbitrator did not explain why he rejected Mr. Movahedi's explanations or what conclusions he drew from this evidence.

The arbitrator also relied on the discrepancy between the surveillance videotape showing Mr. Movahedi driving in August 1993, and Mr. Movahedi's statement to Dr. Zare-Parsi in October 1993 that he could not drive. At the hearing, he testified that he can drive for 10 or 20 minutes at most, and drives only when he has to. He claims that his driving is limited by neck pain, difficulty concentrating and fear of driving.

The arbitrator stated that there was no evidence in the surveillance videotape that Mr. Movahedi had any neck pain or problem moving his head to look around. However, it is not possible to assess whether Mr. Movahedi shows any discomfort because the surveillance was done at night, at some distance from a moving car, and lasts less than a minute.

The arbitrator also stated that he "heard no evidence about [Mr. Movahedi's] fear of driving, or his anxiety to sit in a car, as he had reported to Dr. Zare-Parsi." However, the transcript has Mr. Movahedi testifying that he did not trust himself and "wouldn't feel good" driving.¹² Dr. Zare-Parsi also testified about his fear of driving,¹³ and the issue is mentioned in her clinical notes and reports.

Reading the decision as a whole, I have the impression that the surveillance and observation evidence played an important role in the arbitrator's assessment of Mr. Movahedi's ability to walk, sit and drive, as well as in his assessment of Mr. Movahedi's credibility. I find that the evidence does not support the strong conclusions drawn.

E. Disability

The arbitrator stated that Mr. Movahedi alleges "constant and severe back pain continuing from the time of the accident without improvement" though he admitted some improvement in cross-examination. The arbitrator implicitly found that Mr. Movahedi improved after the accident, based on reports of Dr. Zare-Parsi and Dr. Chow. The arbitrator listed Mr. Movahedi's denial of improvement as an inconsistency undermining his credibility.

Mr. Movahedi testified that his physiotherapy and other treatments give him temporary pain relief. He also admitted on cross-examination that by October 1993, his pain — or at least his severe pain — was "on again, off again."¹⁴ This is not a strong discrepancy. An insured person's reluctance to admit that his pain is intermittent or less than severe does not necessarily mean he is not credible. It may reflect depression, genuine perception of pain, imprecise use of language, or eagerness to convey genuine distress. In this case, the notes of Dr. Boozary and Dr. Zare-Parsi reflect Mr. Movahedi's ongoing complaints, especially of low back pain and depression, after the accident. The test for entitlement to weekly benefits is "substantial" disability, not "total" disability.¹⁵ Where a claim is based on chronic soft tissue pain, the issue is whether the insured person can reasonably and practically be expected to return to work despite his pain.¹⁶ This question is not addressed in the decision.

Mr. Movahedi submits that the arbitrator erred in accepted Dr. Zare-Parsi's testimony, on cross-examination, that the car accident was "just one variable in a number of variables contributing to [Mr. Movahedi's] state." In my view, there is no question that Mr. Movahedi's condition was affected by serious stressors unrelated to the accident.

On February 9, 1994, Mr. Movahedi was involved in a second motor vehicle accident. The arbitrator found that he was charged with drunk driving and lost his driver's licence. In fact, no evidence was presented to rebut Mr. Movahedi's testimony that the charge was later dropped because he was a passenger in the car, not the driver.

On May 20, 1994, Mr. Movahedi was involved in an altercation that left him with a broken nose. Mr. Movahedi testified that while drunk, he picked up some money someone else had left at a bank machine. The rightful owner of the money returned to the scene. Mr. Movahedi was detained overnight and charged. The evidence was unclear whether he was charged with robbery or assault or some other charge.¹⁷ Mr. Movahedi had surgery on his nose in June or July of that year. The arbitrator found that the nose was broken "during his arrest," implying that Mr. Movahedi was punched by the arresting officer. The evidence on this point was confusing. Mr. Movahedi initially testified that he was punched by the owner of the money. Later, he suggested that he might have been punched by the police while in detention. He said he did not remember the events because he was drunk.

Mr. Movahedi submits that the arbitrator's errors with respect to the licence suspension and the bank machine incident tended to magnify the non-accident related stresses he faced in the spring of 1994. The arbitrator did not explain what role these findings played in his decision. In any event, there is no question that Mr. Movahedi was seriously distressed at this time. Two days after the bank machine incident, he was admitted to Scarborough General Hospital after a suicide attempt. He admitted at the hearing that he was depressed about the charges relating to the bank machine incident, his financial situation and breaking up with his girlfriend. Ultimately, I find no error in the arbitrator's implicit finding that these events were significant psychological stressors for Mr. Movahedi.

In her report of October 11, 1994, Dr. Zare-Parsi said that the accident was "the precipitating factor" in Mr. Movahedi's major depression and post-traumatic stress disorder symptoms. I reject Mr. Movahedi's submission that the arbitrator was bound to accept this opinion in the absence of a contrary report from an expert called by State Farm. I find that the arbitrator properly considered the evidence as a whole, including evidence of stressors unrelated to the accident. It was also appropriate for the arbitrator to consider whether Dr. Zare-Parsi's evidence was weakened on cross-examination, and I find no error in his conclusion that it was. On cross-examination, Dr. Zare-Parsi said that the car accident was only one factor, amongst several factors, that affected Mr. Movahedi's psychological health.¹⁸

The arbitrator concluded "I do not find that Mr. Movahedi's psychological or mental problems were the result of the motor vehicle accident in question." Sorting out the role of the accident and other unrelated factors contributing to an insured person's impairment is difficult. A causal connection is not proven just by the fact that the impairment developed after the accident. Conversely, the existence of pre-existing or unrelated problems does not necessarily preclude entitlement. Unfortunately, the arbitrator did not consider whether the accident played a significant or material role in Mr. Movahedi's psychological impairment, or whether Mr. Movahedi's depression prolonged his recovery from his physical injuries.

F. Conclusion

These errors undermine the arbitrator's three key findings — that Mr. Movahedi's symptoms are not those of accident-related spinal stenosis, that Mr. Movahedi's subjective reports of pain cannot be relied upon because he is not a credible witness and that Mr. Movahedi is not psychologically impaired as a result of the accident. They also reflect a general problem with the decision. An arbitrator is not required to give exhaustive reasons for accepting or rejecting every piece of evidence, but must give sufficient reasons that the losing party understands why he lost. It is not enough to simply list the evidence presented by the successful party. The arbitrator must state his factual findings, identify the main evidence that supports them, and explain why he dismissed evidence presented by the losing party. When finding that a party is not credible, the arbitrator must explain why he rejected innocent explanations for discrepancies in the evidence.¹⁹I am not satisfied this happened in this case.

Accordingly the decision cannot stand. The matter will be reheard by another arbitrator.

IV. EXPENSES

Mr. Movahedi is entitled to his reasonable appeal expenses.