Neutral Citation: 1999 ONFSCDRS 219

FSCO A97-000312 and A97-000814

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

RICHARD DESROCHES

Applicant

and

ECONOMICAL MUTUAL INSURANCE COMPANY

Insurer

REASONS FOR DECISION

Before:

Lawrence Blackman

Heard:

March 1, 2, 3 and 4, and June 23, 24 and 25, 1999, in Midland, Ontario.

Appearances:

Andrew R. Kerr for Mr. DesRoches

Gordon L. Robson for Economical Mutual Insurance Company

Issues:

The Applicant, Richard DesRoches, was injured in a motor vehicle accident on November 2, 1994. He applied for and received statutory accident benefits from Economical Mutual Insurance Company ("Economical") payable under the Schedule,¹ including payment of weekly income replacement benefits ("IRBs") pursuant to paragraph 7(1)(1) of the Schedule. The parties agree that Mr. DesRoches was entitled to a Loss of Earning Capacity Benefit ("LECB") offer pursuant to paragraph 21(1)(1) of the Schedule, as he continued to qualify for IRBs 104 weeks after the onset of his disability. It is also agreed that any LECB payment would begin February 24, 1997. The parties, however, disagree on the LECB quantum as well as entitlement to certain other benefits. These disputes could not be resolved through mediation and Mr. DesRoches applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended (the "Insurance Act").

The issues in this hearing are:

1. What is the amount of the weekly LECB to which Mr. DesRoches is entitled?

2. What entitlement does Mr. DesRoches have, pursuant to section 40 of the Schedule, to payment of the labour required to complete his home?

3. What entitlement does Mr. DesRoches have, pursuant to section 40 of the Schedule, to payment of miscellaneous home maintenance expenses?

4. Is Mr. DesRoches entitled to interest on any overdue amounts, pursuant to section 68 of the Schedule?

5. Is Mr. DesRoches entitled to his expenses of this arbitration proceeding?

Result:

1. Mr. DesRoches is entitled to a weekly LECB of $488.87 from February 24, 1997, together with interest on overdue payments in accordance with section 68 of the Schedule.

2. Mr. DesRoches is not entitled to payment of the labour required to complete his home.

3. Mr. DesRoches is entitled to payment of the reasonable labour cost relating to the following maintenance expenses, together with interest on any overdue amounts, in accordance with section 68 of the Schedule:

• driveway repair;

• rearranging the insulation in his lower attic;

• checking the insulation airways from his lower to upper attic;

• recaulking his chimney flashing; and,

• moving sand to the inside of his garage.

4. The parties may now speak to the issue of the expenses of this arbitration proceeding.

EVIDENCE AND ANALYSIS:

1. What is the weekly LECB to which Mr. DesRoches is entitled?

(a) LECB entitlement

Mr. DesRoches injured his neck in the November 2, 1994 accident. He was then 41 years of age. Diagnostic imaging conducted shortly after this accident revealed severe degenerative changes in Mr. DesRoches' cervical spine. Mr. DesRoches had been in a prior car accident in 1979 and had suffered for a number of years thereafter from neck complaints. I accept, however, his evidence that for at least five years prior to the 1994 accident, he did not have (at the very least any significant) neck complaints and was not being treated for any chronic or disabling problem. This was confirmed by both the oral evidence and the contemporaneous pre-accident clinical notes of Dr. M.V. Veall (Mr. DesRoches' family doctor since 1989) as well as the OHIP summary.

I further find, based on the medical evidence, including that of Dr. R. Moulton (neurosurgeon), Dr. C. Lambert (neurologist), Dr. R. Hu (orthopaedic surgeon), and Drs. E. Urovitz (orthopaedic surgeon) and G. Rado (physiatrist), both of whom conducted insurers' medical examinations, that the November 2, 1994 accident aggravated Mr. DesRoches' pre-existing (but asymptomatic) neck condition and significantly contributed to his ongoing neck complaints, although the degenerative changes themselves were not caused by the 1994 accident.

Mr. DesRoches was a self-employed stone mason at the time of this accident. The parties agree, and I find, based on the medical consensus, that as a result of his neck complaints, Mr. DesRoches has been unable to resume this physically demanding occupation.

Fairly early in its carriage of this matter, Economical appears to have concluded that Mr. DesRoches would not be able to return to his former work. It subsequently devoted significant resources to try to determine what alternative employment might be appropriate for the Applicant. Mr. DesRoches has been mistrustful of these efforts due to what appears to have been Economical's lingering suspicion of the legitimacy of the extent of his complaints. As an example, it is undisputed that investigators followed Mr. DesRoches to rehabilitation treatment arranged by the Insurer. Although the investigative evidence was "not spectacular" according to Economical and was not entered as an exhibit, such actions contributed to a deteriorating relationship between the parties.

Mr. DesRoches, however, has shown little initiative or enthusiasm for returning to the workplace. His predominate response to the question of reintegrating into the workforce appears to have been to criticize the Insurer's efforts in this regard. I do find that Mr. DesRoches was extremely well suited for and greatly enjoyed working as a stone mason. I further find that he is angry, unhappy and terribly frustrated at the loss not only of his occupation but also his ability to continue with other physically demanding tasks, such as the construction of his home. I also accept that Mr. DesRoches is in pain and has a genuine fear of aggravating his pain or further injuring himself, although there appears to be no medical support for the latter concern.

However, it is unfortunate that this relatively young man has allowed his anger and fears to stop him from fully taking advantage of the relatively liberal rehabilitation benefits available to him under this Schedule to assist him to return to a reasonable alternative occupation.

Under the Schedule, Mr. DesRoches' continuing qualification for IRBs potentially entitles him to a weekly LECB. The LECB is calculated as 90 per cent of the difference between Mr. DesRoches' pre-accident earning capacity ("PEC") and his residual earning capacity ("REC"). Both Mr. DesRoches' PEC and REC are in dispute in this proceeding.

(b) Mr. DesRoches' Pre-Accident Earning Capacity

I find that Mr. DesRoches' PEC is $543.19, based on the following:

• Economical acknowledges, and I agree, that paragraph 29(4)(a) of the Schedule mandates that Mr. DesRoches' PEC shall not be lower than his net weekly income (as determined by the Schedule) based on his gross employment income for the fifty-two consecutive week period designated by him (which must be within the three years prior to the accident). The Insurer submits that this base amount (which it calculates to be $373.10) is the appropriate PEC for Mr. DesRoches. This amount is based on Mr. DesRoches' self-employment solely as a stone mason. Economical does not accept that Mr. DesRoches was also self-employed in the business of buying and reselling property at a profit.

• Mr. DesRoches submits that his pre-accident annual income should include the sum of $10,103 representing his average annual profit from buying, building/renovating and selling property. I am not persuaded that Mr. DesRoches' prior real estate transactions can be considered to be employment, especially considering that he had only renovated and subsequently sold one house, being the family home in Richmond Hill which was bought in 1981 and sold in 1988 (the only other transaction being the sale of the vacant lot adjacent to his present home). I am even less persuaded that employment income can be attributed to the work done on his present home outside of Midland. I do not find that this property was purchased for a business purpose. Rather, I am persuaded that this house was, as stated by Mr. DesRoches, intended to be the family "dream home." This is the most logical explanation as to why the DesRoches family would continue to live in an unfinished "tar paper mansion" (as described by Mrs. DesRoches) after the accident and after it was abundantly clear that Mr. DesRoches would not be able to finish the house on his own (his labour being his major alleged source of profit). One would have expected that if the purchase of this property was indeed a business venture, that Mr. DesRoches would have long ago cut his losses and sold the property.

• Economical further acknowledges, and I agree, that Mr. DesRoches' PEC is not limited to his declared pre-accident employment income. Rather, subsection 29(2) of the Schedule mandates that as a self-employed individual, Mr. DesRoches' PEC shall be derived "using the gross annual income from employment that [he] could reasonably have earned at the time of the accident, having regard to [his] personal and vocational characteristics at that time" [emphasis added].

• "Personal and vocational characteristics" are defined in section 1 of the Schedule as including (and hence not restricted to):

(a) employmenthistory,

(b) education and training,

(c) vocational interests and aptitudes,

(d) vocational skills,

(e) physical abilities,

(f) cognitive abilities, and

(g) language abilities.

• Mr. DesRoches submits that his personal and vocational characteristics entitle him to the maximum weekly LECB of $1,000, indexed in accordance with section 79 of the Schedule. He relies in large part on the February 1999 report of a rehabilitation counsellor, Mr. J. Kumove. Mr. Kumove determined, based on both government data and contacting stone masonry contractors in south-central Ontario, that stone masons earn between $50,000 and $70,000 per year as employees and $110,000 to $150,000 per year if self-employed. Mr. Kumove testified that he did not find any stone masons earning less than $50,000 per year.

• I find that Mr. DesRoches' PEC and REC must both realistically approximate his earning capacity in accordance with the criteria of the Schedule. I have significant concern as to the accuracy of Mr. Kumove's income ranges. A labour market survey of employed stone masons was conducted in early 1996 by Crawford & Company Healthcare Management ("Crawford") at Economical's request. They note, based on seven companies in the Midland/Orillia area, that stone masons' salaries start at $15 to $20 an hour, with a maximum hourly wage of $40. Assuming 40 hours a week of employment, 52 weeks a year, the lower end of this range corresponds to a yearly salary of $31,200 to $41,600, considerably below Mr. Kumove's $50,000 minimum. However, these numbers do not take into consideration the consistent theme in the Crawford survey that there were no positions available in the greater Midland area due to poor economic conditions. Nor do these figures take into consideration the evidence received in this hearing that there is a seasonal component to stone masonry work.

• I am also concerned with the accuracy of Mr. Kumove's ranges of remuneration, based on Mr. DesRoches' own declared income from 1985 to 1994. None of his returns show an annual net employment income greater than $25,000 (even if his wife's management fees are entirely attributed to him). Mr. DesRoches' overall sworn testimony, at its very best, was inconsistent as to whether his income tax returns showed all of his income. Equally important, Mr. DesRoches did not allege or present any evidence of any higher pre-accident income. I find that Mr. DesRoches' actual past earnings are an important, but not conclusive piece of evidence as to what he could reasonably have earned at the time of this accident.

• Mr. DesRoches submits that his pre-accident income does not accurately represent his full potential working capacity because:

1. at the time of the accident his income was increasing, concurrent with an improving economy;

2. in 1988 he moved from Richmond Hill to Midland for a more family-based (and less work-oriented) lifestyle;

3. since 1989, he had been expending significant time and effort building his own custom designed 3,000 square foot house in Perkinsfield, Ontario, outside of Midland; and,

4. his declared income reflected his instructions to his accountant to "pay as little as possible" in taxes.

• I do not accept the submission that Mr. DesRoches' income was increasing at the time of the accident. I note that Mr. DesRoches' gross income from May to October 1993 inclusive was actually more than 25 per cent higher than his gross income from May 1994 to the end of that calendar year (the accident being in November of that year).

• Further, Mr. DesRoches' PEC depends on his earning capacity at the time of the accident. Even assuming that Mr. DesRoches' pre-accident income was in fact reduced due to his lifestyle changes or his work on his home, these factors still existed at the time of this accident. Indeed, Mr. DesRoches brings a claim for $106,013 for a further 3,000 hours of labour (at $35 an hour) necessary to replace his intended work on his house.

• However, I find that the Legislature, by using the words "could reasonably have earned," requires an inquiry into what a self-employed insured person was potentially capable of earning (the Concise Oxford Dictionary of Current English, Eighth Edition, Clarendon Press, Oxford, 1990, defining "can," the present tense of "could" as including "be able to" and "be potentially capable of"). I do not find that Mr. DesRoches' declared income best reflects what he was reasonably potentially capable of earning at the time of the accident, for the following reasons:

• I am not persuaded that Mr. DesRoches' actual past income is accurately reflected in his income tax returns;

• Mr. DesRoches' best fifty-two week (stone mason) income period determined by the accounting evidence is roughly equal to only the lower end of the employee income range in the Crawford range survey;

• I do not find that Mr. DesRoches could be considered to be at the lower end of the stone mason income scale. Rather, I find that at the time of this accident Mr. Desroches had some twenty years of experience in this type of employment. I further find that Mr. DesRoches was extremely well suited for his pre-accident occupation, based on his personal and vocational characteristics as noted by the rehabilitation experts retained by both parties as well as the Designated Assessment Centre ("DAC"), including his preference for self-employed, outdoor and "realistic" work using raw materials and machinery;

• I find that at the time of this accident Mr. Desroches was physically fit; and,

• I further accept that before this accident Mr. DesRoches had been a hard working person. I note that he had worked from a very young age (to help support his large family following his father's death) and had left school early to earn a living.

• Given these factors, I find that the appropriate hourly wage for Mr. DesRoches would not be at the bottom of the Crawford range (whose survey I accept as more detailed, accurate and focused to the Midland area than the only alternative, being that of Mr. Kumove). Rather, I am persuaded, given these factors and the salary range established by Crawford, that an hourly wage of $30 would be appropriate for Mr. DesRoches.

• Forty hours per week, fifty-two weeks a year at $30 an hour equals $62,400. However, I find that this figure should be discounted by 35 per cent. This reflects firstly the contingency of Mr. DesRoches finding work during an economic downturn. In this case, there is no evidence of another job being readily available to Mr. DesRoches. The report of Northern Lights Vocational Services ("Northern Lights") notes an official unemployment rate in the North Simcoe area (in which Midland is located) of 8.3 per cent in February 1996 and a more accurate unemployment rate of 15 to 18 per cent. The 35 per cent discount also reflects stone masonry's seasonal nature and the Applicant's work habits and lifestyle. Mr. DesRoches testified that his stone mason season was basically March to December (although he might do some work such as basement renovation in the winter). His monthly records confirm a drop in income in the winter. The deduction also reflects that Mr. DesRoches may have taken time from his employment to work on his own house, although I accept that the latter work would have largely been done in the evenings and on weekends. I find that only by taking into consideration these factors can effect be given to the statutory words could reasonably have earned."

• The net result is an annual income of $40,560. Using the Commission's "Net Weekly Income Table - Other Than Self-Employment," column 1 (as used by the Applicant's accountant and which was not disputed), one arrives at a PEC of $543.19 per week.

(c) Mr. DesRoches' Residual Earning Capacity

• Section 30 of the Schedule mandates that Mr. DesRoches' REC is derived from the gross annual income that he could earn from the type of employment that best satisfies the following criteria:

• he is able and qualified to perform the employment’s essential tasks;

• he would have been able and qualified to perform the employment’s essential tasks had he not failed to take treatment or rehabilitation that was reasonable, available or necessary;

• the employment exists in the area where he lives and is accessible to him; and,

• it would be reasonable to expect Mr. DesRoches to engage in the employment having regard to the possibility of deterioration in his impairment and to his personal and vocational characteristics.

• Mr. DesRoches submits that his REC is zero. The weight of the medical evidence, however, does not support a claim of total disability. Mr. DesRoches' own expert, Dr. J. E. Trotter, a specialist in Physical Medicine and Rehabilitation, wrote in April 1998 that:

In my opinion, [Mr. DesRoches] is not totally disabled from all work activities and it would be a disservice to label him as such. Meaningful work is therapeutic in that it provides great distraction from one’s problems and is a major source of self-esteem. Mr. DesRoches could participate in sedentary occupational activities without causing harm to his physical/medical condition.

I find the evidence of Mr. DesRoches family doctor, Dr. Veall, essentially consistent with that of Dr. Trotter.

• Economical submits that Mr. DesRoches' REC is $343.69. The Insurer relies on WORKABLE Centres Inc.'s ("WORKABLE") February 1997 REC DAC report which found the employment which best represented Mr. Desroches' REC was that of Coding Clerk" with a yearly salary of $23,204. The generic classification of "Coding Clerk" involves recording alphabetic or numeric codes for data, scanning materials to be filed, marking codes on material, and filing." Specific included occupations are "Census Enumerator, Election Enumerator, Interview Clerk, Poll Clerk, Public Opinion Collector, Survey Interviewer and Telephone Survey Clerk" as well as statistical clerks. I find that there are several fundamental problems in the WORKABLE report.

• Firstly, the conclusion in the WORKABLE report assumes that Mr. DesRoches is able to work consistently on a full-time competitive basis. Dr. E. Urovitz addressed this concern in his November 15, 1995 insurer's medical examination, as follows:

From a disability perspective, I think the essential limiting feature here is this man's ongoing pain experience. His ability to function on a day to day basis then is purely dependent upon his motivation to work with pain and his ability to deal with that pain.

The medical consensus is that Mr. DesRoches is having pain significant enough to disable him from returning at the very least to physically demanding labour. Dr. Veall wrote in his May 21, 1996 report that:

I certainly feel that Mr. Desroches [sic] illness is genuine and that his pain is quite disabling when present.

I found Dr. Veall to be a credible witness. Although he clearly did not wish to harm Mr. DesRoches' claim, he was very careful as to the extent to which he would support the Applicant's position. I think there is merit in Dr. Veall's evidence that there is a difference between getting a job and maintaining one. The latter requires a good attendance record and Mr. DesRoches' frequent exacerbations of neck pain would make maintaining a job difficult.

This position was supported by Mr. Kumove and Ms. P. Koczerginski, a disability analyst retained by the Applicant. It was also supported by, amongst others, the Columbia Rehabilitation Centre (whom Mr. DesRoches did not trust because he thought they were in league with the Insurer as a result of the above-noted surveillance incident) who stated in their October 1996 report that Mr. DesRoches "appears to suffer from cycles of good days and bad days in regards to his pain. On good days he appears fully engaged and lucid and apart from restricted movements due to guarding, he is physically appropriate. On bad days, Mr. Desroches [sic] reported high levels of pain and he did not interact effectively with others."

The WORKABLE REC DAC report itself detailed Mr. DesRoches' fluctuating level of pain and corresponding ability to do the requested work trials over a five-day period. Early in the testing, Mr. DesRoches declined to continue dispatch work due to pain. Pain behaviours are noted and Mr. DesRoches is reported to have taken several pain pills during the day. The day Mr. DesRoches was able to do five hours of sedentary work as a Coding Clerk appears to be his most pain free day, although he is reported to have taken two Percocet that morning. The next day, however, Mr. DesRoches reported increased pain. Pain behaviours are again noted. The reviewer notes that Mr. DesRoches inability to work as a counter clerk was "inconsistent with previously demonstrated abilities to work at the Light Strength Level."

While it is possible that Mr. DesRoches was at times consciously limiting his abilities, it does not make sense that he would at other times perform at what WORKABLE finds to be a competitively employable capacity. I am persuaded that the more logical explanation for his "inconsistencies" is that his pain experience varies (which is confirmed by the medical evidence) and hence his abilities fluctuate. The flaw in WORKABLE's analysis is the unstated assumption that a "snapshot" ability to sustain a task for five hours on a single day automatically translates into the ability to do that task on an ongoing basis, eight hours a day, five days a week, fifty-two weeks a year. Indeed, Dr. D. Ozimok, one of the authors of the WORKABLE report, testified that there was no indication in the report that the assessor took into consideration Mr. DesRoches' ability to perform the tasks of a coding clerk on a bad pain day.

• I find that Mr. DesRoches is unable to perform the essential tasks of even sedentary full-time employment as a result of his neck pain which is materially contributed to by this accident. I accept Ms. Koczerginski's evidence that "[i]n a practical sense, he requires a genuinely flexible employer who would be willing to accommodate his variable symptomatology relative to physical demands." This echoes the earlier July 1996 opinion of Northern Lights (retained by Economical) which stated that [a]t the present time, Richard's reported pain intensity and unpredictability is such that his employment needs to allow him to be flexible in both activity and attendance."

• I do not find that section 30 of the Schedule limits an adjudicator's options to either full-time or zero employment. Residual earning capacity can reflect part-time earning capacity, as long as that is a reasonable option. In this case, I accept Dr. Trotter's oral evidence that she had some confidence that Mr. DesRoches could return to some form of remunerative employment and is not totally disabled. I find that as of February 24, 1997 and following, however, that Mr. DesRoches would have significant difficulty maintaining, on a consistent basis, anything more than flexible half-time light or sedentary employment, even if he were significantly more motivated.² I base this in large part on Mr. DesRoches' difficulty engaging in the work simulations conducted by WORKABLE and the difficulty he would have persuading an employer to continue to engage him on a full-time basis, when he could not be counted on, due to genuine pain, either to be able to come to work on a given day or be able to work through a full shift.

• This, however, leads to a second fundamental difficulty that I have with the WORKABLE report. Their conclusion further assumes that employment as a Coding Clerk in the Midland area is easily and immediately accessible to Mr. DesRoches and that there are no obstacles to his returning to work. I do not accept this assumption. Rather, I accept the evidence of Dr. Trotter that there are legitimate barriers to Mr. DesRoches returning to work including the period of time he has been off work, his deconditioning and his fear that he may injure himself. I also find his limited education (Grade 10 plus a one-year Optical Technician Programme and an eight-month masonry course at Georgian College, both more than twenty years ago) and limited training (two decades of stone masonry and construction work preceded by a brief stint as an optical technician, a job he disliked) are also barriers to employment. I also find that a further barrier to employment would be the likely hesitation by employers to hire someone who has an impairment, has been absent from the workforce for a considerable period of time and who may have a greater potential for a workers compensation claim. I further note the opinion expressed in the WORKABLE report itself that:

The most problematic feature regarding [Mr. DesRoches ] vulnerability is the amount of time that has occurred since his accident. It has been more than 24 months since that event and he has not been able to effect a return to work or achieve a higher level of function. Thus, it would appear that the prognosis for a self-directed and unassisted return to work is poor and that it is likely he will continue to find himself enmeshed in a Chronic Pain Syndrome for some time to come.

• I accept a real unemployment rate in the Midland area of approximately 15 per cent at the time in question. I further find, based on the specific barriers to Mr. DesRoches of finding a sympathetic and flexible employer, that it would be at least twice as hard for him to find employment as the average worker, which amounts to a contingency of 30 per cent.

• However, I am not prepared in this case to approximate an REC, although I am persuaded that Mr. DesRoches does have some level of residual earning capacity.³ I am firstly not satisfied that the Coding Clerk occupations listed by WORKABLE actually exist in the Midland area other than on an ad hoc or periodic basis. It is obvious that jobs such as census or election enumerators and poll clerks are not continuing positions. The onus exists on the party relying on the REC DAC to establish, on a balance of probabilities, that amongst other things that the criteria set out in section 30 of the Schedule is satisfied and furthermore that the type of employment selected best satisfies" that criteria. There is nothing in the WORKABLE report which indicates that the Coding Clerk positions actually exist in the Midland area. Dr. Ozimok testified that generally WORKABLE considers whether a job is available and does a labour market survey. He was not aware, however, whether any such investigation had been in this case. I am not prepared to assume, without evidence, that employment positions such as public opinion collectors, survey interviewers and telephone survey clerks or other Coding Clerk jobs exist in Midland and are accessible to the Applicant.

• More fundamentally, I find that the type of employment chosen by WORKABLE is not reasonable having regard to Mr. DesRoches' personal and vocational characteristics. The positions encompassed by the classification of Coding Clerk do not correspond to Mr. DesRoches' interests and aptitudes as set out in every report and contradict the following findings of the WORKABLE report itself that Mr. DesRoches:

• "would prefer outdoor work and a type of employment where he can work on a self-employed basis;"

• "possesses strong interests in the vocational area of realistic work. Typically, an interest in this field indicates a preference for activities which involve the manipulation and/or use of inanimate objects such as raw materials, machinery and instruments."

WORKABLE supports its conclusion by citing the following excerpt from this Commission’s DAC Guidelines for REC Assessments:⁴

In considering the personal and vocational characteristics, the claimant's "interest" may represent some specific challenges in selecting an employment type. However, in the case where earning capacity is seriously diminished when the s/'ng/e variable of interest is factored in, interest should be weighted as less important and the employment type that maximises earning capacity should be selected.

A REC DAC is required by subsection 63(2) of the Schedule to use the Commission Guidelines in conducting assessments. Such guidelines, pursuant to 268.3(2) of the Insurance Act, must be considered by arbitrators, but are not binding.⁵

Looking at this Guideline in a vacuum, I see no justification for WORKABLE failing to give any weight to Mr. DesRoches' personal and vocational characteristics. However, I further see no justification in section 30 of the Schedule for a guideline which seeks to "maximize" earning capacity at the expense of "personal and vocational characteristics." I find that paragraph 30(2)(3) militates against orthopaedic surgeons being forced to work as parking lot attendants. I do not think that any less respect should be given to skilled craftsmen. The question the legislation poses is what is reasonable employment for the insured person. Based on Mr. DesRoches' personal and vocational characteristics noted above, I find that a Coding Clerk position is not reasonable employment for this Applicant.

• Other possible occupations are noted in the evidence before me. Considerable evidence was received as to whether Mr. DesRoches could return to working as an optical lab technician. Ms. Koszerginski did a detailed on-site work analysis of this occupation at a LensCrafters' retail outlet. I accept her opinion that this type of employment is inconsistent with Mr. DesRoches' abilities, as it requires an excessive amount of standing or stooping posture, with the neck bent or rotated to view work." I am not satisfied, in any event, that part-time employment in this field is a reasonable option or that Mr. DesRoches is presently qualified for this position. More importantly, I am not satisfied that it is reasonable to require Mr. DesRoches to return to an occupation which he left more than twenty years ago because he disliked it.

• Other potential alternative occupations were considered by Rehabilitation Services of Canada ("Rehabilitation"). In its March 1995 report, Rehabilitation set out numerous alternative occupations with an hourly salary range of $7 to $17. Little, if any, detail was provided by Rehabilitation as to the specific duties of these positions. No effort at job trials or work simulation was attempted. However, based even on the limited information provided, I find these jobs to be inappropriate.⁶

Several job options are set out in an appendix to the May 15, 1996 report of Northern Lights. Mr. DesRoches does not presently meet the educational requirements of these vocational options.⁷ A later report of Northern Lights dated July 23, 1996, sets out two possible employment options which do not require training for Mr. DesRoches. However, the report does not set out the employment income available for either of these positions, and further indicates that there are no firms in the North Simcoe area which employ Home Inspectors, one of the two options.

• Subsection 27(6) of the Schedule states that if the REC DAC concludes "that there is no employment that complies with the criteria set out in subsection 30(2), the person's residual earning capacity shall be deemed to be zero." I find that the same conclusion may be reached by an adjudicator. I find that the REC DAC's Coding Clerk employment does not comply with the required criteria.⁸ I find that the possible alternative types of employment before me either do not meet the required criteria or provide insufficient information. Accordingly, I find that Mr. DesRoches has a zero REC.

(d) Mr. DesRoches' Loss of Earning Capacity Benefit

As noted above, Mr. DesRoches' weekly LECB is determined as 90 per cent of the difference between his PEC and his REC, or: 0.9 x [$543.19 - $0.00] = $488.87.

2. What entitlement does Mr. DesRoches have to payment of the labour cost required to complete his home?

Mr. DesRoches submits that but for his accident-related injuries, he himself would have provided the labour necessary to complete his Perkinsfield house. He argues that the labour cost of hiring someone else to now finish the house is $106,013. He claims that paragraphs 40(5)(a) and (b) of the Schedule entitle him to payment of this sum from Economical. The relevant portions of section 40 state as follows:

40. (1) If an insured person sustains an impairment as a result of an accident, the insurer shall pay for reasonable measures,

(a) to reduce or eliminate the effects of any disability resulting from the impairment; and

(b) to facilitate the insured person’s reintegration into his or her family, the labour market and the rest of society.

(3) In determining what payments are required under subsection (2), regard shall be had to the insured person's personal and vocational characteristics.

(4) The payments required by subsection (1) for the purpose of facilitating the insured person’s reintegration into his or her family and the rest of society include payment for social rehabilitation measures that are reasonably necessary to,

(a) return the insured person as much as possible to the family and social situations in which he or she lived before the accident;

(b) assist the insured person to adjust to family and social situations as a result of the accident; and

(c) maintain the insured person’s level of function within the home and family.

(5) The payments required under this section include payment of all reasonable expenses incurred by or on behalf of the insured person as a result of the accident for a purpose referred to in clause (1)(a) or (b) for,

(a) social rehabilitation, including life skills training, family counselling, social rehabilitation counselling, financial counselling, home renovations and home devices to accommodate the needs of the insured person, vehicles, vehicle modifications to accommodate the needs of the insured person, and communications aids for the insured person’s home;

(b) vocational rehabilitation, including employment counselling, vocational assessments, vocational training, academic training, workplace modifi cations and workplace devices to accommodate the needs of the insured person, and communications aids for the insured person's employment . . [emphasis added]

The Applicant makes the following submissions in support of his claimed entitlement:

1. The labour cost necessary to complete the Perkinsfield house is a pecuniary loss which could have been claimed under tort law prior to the enactment of Bill 164 (which brought into law, amongst other legislative changes, the Schedule presently under consideration). The Applicant argues that as pecuniary losses are not recoverable in tort under Bill 164, it must be recoverable under the Schedule.

I do not accept this argument as a basis for entitlement. As has been stated in other arbitration decisions, the Schedule represents a trade-off between expanded contractual coverage (for which fault is generally not relevant and hence includes a larger number of potential claimants) and restricted tort recoverability. This Commission has consistently interpreted the legislation as intending to add to the guest list by reducing the portions. One must therefore look to the actual provisions of the contractual agreement under the Schedule to determine whether there is indeed coverage available for the specific pecuniary loss claimed.

2. The Applicant thus argues that his claim is encompassed under section 40, as finishing his house would both eliminate the effects of his disability and facilitate his reintegration into his family.

I agree with the Applicant that the use of the term "or" in subsection 40(5) of the Schedule makes it clear that both purposes set out in subsection 40(1) do not need to be met in order to establish entitlement. I also agree that subsection 40(5), by using the word "include," makes it clear that other pecuniary losses are potentially recoverable. I agree with the Applicant that payment of the requested labour cost would eliminate (in accordance with paragraph 40(1)(a) of the Schedule) what I find to be a consequence or effect of his disability, namely his inability to complete the house on his own. I further agree that payment of this pecuniary loss would facilitate his reintegration into his family by returning Mr. DesRoches as much as possible to his pre-accident family situation, which I find included his undertaking to build, largely by himself, the family home.

The Applicant submits that section 10 of the Interpretation Act, R.S.O. 1990, c. requires that section 40 of the Schedule be given a fair, large and liberal construction and interpretation. However, the Interpretation Act further states that the purpose of such an approach is to "best ensure the attainment of the object of the Act according to its true intent, meaning and spirit."

I am also cognizant of the present approach to statutory interpretation, as set out by R. Sullivan in Driedger on the Construction of Statutes, Third Edition, Butterworths (Toronto, 1994), at page 131:

There is only one rule in modern interpretation, namely, courts are obliged to determine the meaning of legislation in its total context, having regard to the purpose of the legislation, the consequences of proposed interpretations, the presumptions and special rules of interpretation, as well as admissible external aids.

Looking at the entire Schedule, I find a distinction between Part VIII (entitled "Rehabilitation expenses," which includes section 40) and Part XIII (entitled "Compensation for other Pecuniary Losses" and which includes payment of additional expenses incurred for caring for the insured's dependants or for housekeeping and home maintenance services).

I am persuaded that Part VIII generally pertains to reasonable rehabilitative measures necessitated by the accident, to make the insured person as functional as possible. I am not persuaded that Part VIII, read as a whole and in the context of the entire Schedule, is intended, in the absence of such a rehabilitative purpose, to compensate for or replace functions once performed by the insured person. Hence, section 41 of the Schedule (also coming under Part VIII), entitled Home Modifications," speaks to renovations required to accommodate the needs of the insured person," which would include such things as installing railings. This particular provision would not include replacement labour, and indeed, the Applicant does not make a claim under this section.

Rather, entitlement to replacement labour must be looked to outside of section 40. As noted above, Part XIII specifically allows compensation for certain functions once performed by an insured which that person can no longer as a result of the accident perform. The absence of any provision allowing payment of replacement labour to complete one's house persuades me that this pecuniary loss, by itself, is not recoverable under the Schedule.

I agree, however, with the approach of Arbitrator Sampliner, in Zettler and Pilot Insurance Company (OIC A-000674, March 31, 1998) and find that some measure of replacement labour might qualify as a reasonable expense under section 40 of the Schedule, if, as part of his rehabilitation, it would assist the Applicant in resuming his completion of his house. Given the Applicant’s position that he is presently and in the foreseeable future unable to partake in any such work, I can find no rehabilitative purpose in allowing payment of the claimed replacement labour.

If I am wrong in my determination that this claim is not encompassed under the Schedule, it is necessary to address the reasonableness of the $106,013 claim. The Applicant filed as an exhibit a detailed contract proposal dated February 27, 1996 prepared by his cousin, Steve Grozelle, who is a carpenter and who has worked for at least ten years building houses. Both the Applicant and Mr. Grozelle gave further detailed oral testimony on what remained to be done on the house, evidence which I accept. My general impression of their evidence was that their estimate was very liberal both in the custom-type quality of the work proposed and in the hours designated to do such custom work. As noted above, based on Mr. Grozelle’s hourly rate of $35, it would take him some 3,000 hours (or about a year and a half at 40 hours a week) to finish the house (which is presently sufficiently complete to allow the DesRoches family to live in it).

However, I have no expert evidence from the Insurer to counter this proposal and there were few concessions made on cross-examination (e.g. the number of hours to make the shelves might be high). Further, in accordance with subsection 40(3) of the Schedule which requires me to have regard to Mr. DesRoches personal and vocational characteristics, I am persuaded that it was his pre-accident intention to build a custom-made house. Accordingly, I accept the evidence of the Applicant and find the amount claimed to be "within the limits of reason," as stated in Plows and Jevco Insurance Company (OIC A-000175 and A-000588, January 16, 1992). I find that Mr. DesRoches would not be able to provide any meaningful assistance to the work on his house and, therefore, I do not make any deduction for Mr. DesRoches' potential participation in the completion of his house.

3. What entitlement does Mr. DesRoches have to payment of miscellaneous home maintenance expenses?

Mr. DesRoches claims entitlement to payment of the labour expense necessary to complete certain household tasks. Mr. DesRoches does not seek an order for specific compensation, but rather a more general declaration of entitlement. This claim is noted in the pre-hearing letter to be brought pursuant to section 40 of the Schedule, which pertains to Rehabilitation Expenses. I find that this claim is properly brought under section 55 (as noted in the mediator's report herein of May 30, 1997) which pertains to housekeeping and home maintenance expenses, and which states as follows:

If an insured person sustains an impairment as a result of an accident, the insurer shall pay for additional expenses reasonably incurred by or on behalf of the insured person as a result of the accident for housekeeping and home maintenance services.

The Applicant relies on the endorsement of his family doctor, Dr. Veall, that his ability to perform the claimed maintenance activities would be hampered by symptoms relating" to this accident. Dr. Veall testified that he chose these words carefully. I do not take his notation to mean, as interpreted by Mr. DesRoches, that these chores are beyond his capacity. Rather, I take it to mean that these activities are made more difficult by Mr. DesRoches' pain complaints. The question then becomes, how much pain is too much pain?

I will individually consider the maintenance activities still in dispute.

1. Clean up leaves, fallen branches and acorns:

I accept the undisputed evidence of the Applicant and his wife that they own a large, well-treed property. I further accept that each year a large number of acorns fall and that unless they are raked, their house will be surrounded by a forest of oak trees. I further accept that yearly maintenance is required to rake leaves as well as pick up fallen branches.

The Schedule limits compensation to "additional expenses reasonably incurred." This means that these duties must have been performed by the Applicant prior to the accident. The Applicant has not persuaded me that he exclusively performed these chores prior to this accident, as opposed to some other member of the household doing them, either partially or entirely.

Further, even if I were to accept that Mr. DesRoches had the sole responsibility for this task before this accident, I do not find it reasonable to require Economical to pay for someone to do this job. Unlike remunerated work, Mr. DesRoches would have the ability to pace his activity and take as many breaks as necessary. Unlike the significant work required to be done on his house, I think it reasonable for Mr. DesRoches to perform this discrete annual task. I rely on the evidence of Mr. DesRoches' own expert, Dr. Trotter, that she would encourage Mr. DesRoches to try to do this. The fact that some assistance from family members might be helpful in accomplishing components of this chore such as lifting does not make it reasonable for the Insurer to bear the expense of hiring someone to do this task.

2. Driveway repair:

I accept the Applicant’s evidence that he has an unfinished 350 foot driveway, which due to rain erosion, needs to be levelled. I accept that this requires significant physical labour. I further accept that Mr. DesRoches would have been responsible for this work prior to this accident. I find that this activity, even if paced, would likely significantly aggravate the Applicant’s pain. Accordingly, I find it reasonable for Economical to pay someone to physically do this work.

The Applicant submitted a bill for a bobcat for a day to assist in the driveway repair. I have no evidence to persuade me that such equipment would not have been required even if the accident had not occurred. I, therefore, decline to allow this expense.

3. Repair a broken shingle:

I have no evidence where this shingle is and whether one has to climb onto the roof. I am not satisfied that the Applicant cannot, at his own pace, simply climb up a ladder and hammer in the one shingle, without any undue difficulty. I, therefore, decline to award this expense. However, as I do allow the chimney flashing repairs below, if Mr. DesRoches is so inclined, he can ask that repairman, as he is already going on the roof, if he can also hammer in a new shingle at no extra cost.

4. Rearrange the insulation in the lower attic:

I am persuaded that this is an activity which the Applicant would have done prior to this accident. I am further persuaded that there is a reasonable probability that crawling in cramped quarters would significantly aggravate his pain. A July 13, 1998 estimate from Servicemaster prices this job at $50, a relatively minor expense. I allow this claim.

5. Check the insulation airways from the lower to the upper attic:

For the reasons set out in #4 above, I allow this expense.

6. Recaulk the chimney flashing:

I am satisfied that the Applicant would have done this job, but for this accident. I am persuaded that the height and steepness of the roof make it reasonable for someone else to now do this task.

7. Wheelbarrow sand to interior of garage:

I accept the Applicant’s evidence that his two-car garage does not have a permanent floor. I further accept that the ground has settled and that several loads of sand need to be brought by wheelbarrow to the garage interior. I am persuaded that the Applicant would have done this job before this accident. I am further persuaded that this is a physically demanding task which would likely now significantly aggravate Mr. DesRoches pain. Accordingly, I allow this additional labour expense.

EXPENSES:

Submissions on the issue of expenses were deferred until all other issues in dispute had been decided. Accordingly, the issue of the expenses of this arbitration proceeding may now be spoken to, if that issue cannot be resolved by the parties themselves. I wish to thank both counsel, however, for their courtesy, their professionalism and their high level of competency in presenting their respective cases.

November 10, 1999

Lawrence Blackman Arbitrator

Date

Neutral Citation: 1999 ONFSCDRS 219

FSCO A97-000814 and A97-000312

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

RICHARD DESROCHES

Applicant

and

ECONOMICAL MUTUAL INSURANCE COMPANY

Insurer

ARBITRATION ORDER

Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:

1. Economical Mutual Insurance Company shall pay Mr. DesRoches a weekly LECB of $488.87 from February 24, 1997, together with interest on overdue payments in accordance with section 68 of the Schedule.

2. Economical Mutual Insurance Company shall pay Mr. DesRoches the reasonable labour cost relating to the following maintenance expenses, together with interest on any overdue amounts, in accordance with section 68 of the Schedule:

• driveway repair;

• rearranging the insulation in his lower attic;

• checking the insulation airways from his lower to upper attic;

• recaulking his chimney flashing; and,

• moving sand to the inside of his garage.

3. The parties may now speak to the issue of the expenses of this arbitration proceeding.

November 10, 1999

Lawrence Blackman Arbitrator

Date

Footnotes

1. 1The Statutory Accident Benefits Schedule — Accidents after December 31, 1993 and before November 1, 1996, Ontario Regulation 776/93, as amended by Ontario Regulations 635/94, 781/94, 463/96 and 304/98. O.R. 776/93 was extensively modified by O.R. 781/94; accordingly, where necessary, "1994 Schedule "refers to the original O.R. 776/93, and "1995 Schedule "refers to O.R. 776/93 as amended.
2. 2In saying this, I specifically note that I do not find that Mr. DesRoches has refused to obtain any treatment or participate in rehabilitation that was reasonable, available and necessary" to permit him to engage in any employment, which is a consideration under section 30 of the Schedule.
3. 3If I had approximated Mr. DesRoches' REC, I would have concluded that the income that Mr. DesRoches could reasonably earn would be $446.23 per week as a Coding Clerk, reduced by 50 per cent to account for his difficulty in maintaining this employment and further reduced by 30 per cent (against the remaining 50 per cent possible employment income) to account for his difficulty in obtaining such employment. This amounts to a total reduction of 65 per cent against the weekly sum of $446.23, which leaves $156.18 per week. Using the Commission tables, one arrives at a weekly REC of $145.30. Had Mr. DesRoches either been in or if there was a probable expectation that he would have entered a reasonable, available and necessary rehabilitation programme which would have decreased his concurrent ability to seek employment, I would have taken that into consideration as a personal and vocational characteristic in determining his REC.
4. 4Ontario Insurance Commission Guidelines for Designated Assessment Centres to Conduct Residual Earning Capacity Assessments for Accidents on or after January 1, 1994 and before November 1, 1996, dated November 1996.
5. 5Oliveira and Wellington Insurance Company (OIC A96-000010, April 7, 1997).
6. 6Some of these jobs (such as security guard) were essentially ruled out by the REC DAC (which felt that Mr. DesRoches did not meet the physical demands of frequent walking"). The position of Fire Equipment Inspector only existed as part of the work of an active Fire Fighter, which I do not find Mr. DesRoches capable of performing. Cemetery Worker required heavy lifting. Document Preparer either required heavy lifting or was seasonal in nature. No specifics were provided as to the actual seasonal length of such employment. Mr. DesRoches was not presently qualified for electronics work, which required an electronics certificate and computer aided design knowledge. The position of Construction Supervisor did not exist in the absence of heavy labour requirements. Farming Sales Representative required a farming background which Mr. DesRoches did not have. No indication was given as to what "Sales Representative Vending" entailed. Order Taker Supervisor and Telephone Solicitor were both taken from local Canada Employment Centre listings but no employer information was provided. I note again my concerns as to whether such positions exist in the Midland area and further, the reasonableness of Mr. DesRoches performing such employment.
7. 7The Civil Engineering Technologist/Technician position required completion of a two or three-year college programme as did the occupation of Biological Technologist/Technician and Conservation and Fishery Officer. A Construction Estimator required completion of secondary school as well as possible certification by the Canadian Institute of Quantity Surveyors. Landscape and Horticulture Technicians and Specialists usually required completion of a university or college programme.
8. 8WORKABLE notes that Mr. DesRoches met the physical and cognitive demands of grain receiver and retail sales/counter clerk, even though on testing he did not demonstrate the ability to meet the Light physical demands of either position. I am not persuaded that Mr. DesRoches could perform either job consistently on anything approaching full-time employment. I am not satisfied that the position of grain receiver exists in the Midland area. I am not satisfied that the position of retail sales/counter clerk, which one must presume exists in the Midland area, is one which is reasonable having regard to Mr. DesRoches' personal and vocational characteristics. In any event, I have no evidence as to the employment income that one could earn from these types of employment.