Halifax Insurance Company v. Elham Raymond (El Hitti), 1999 ONFSCDRS 246

Financial Services Commission / Commission des services financiers de l’Ontario

Neutral Citation: 1999 ONFSCDRS 246 Appeal: P99-00019 Office of the Director of Arbitrations

Halifax Insurance Company Appellant

and

Elham Raymond (El Hitti) Respondent

Before: Nancy Makepeace

Counsel: Debbie Orth and Patricia Simpson (for Halifax) Catherine L. Coplea (for Ms. Raymond)

APPEAL ORDER

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

1. The appeal is dismissed and the arbitration order dated March 8, 1999 is confirmed.

2. Interest on the benefits paid on April 15, 1999 continues to accrue until April 15, 1999. Ms. Raymond's submission that further interest is payable on the basis that the benefits were paid pending dispute is denied.

3. Halifax shall pay Ms. Raymond's reasonable appeal expenses.

December 17, 1999

Nancy Makepeace Director's Delegate

Date

REASONS FOR DECISION

I. NATURE OF THE APPEAL

Halifax appeals the arbitration order dated March 8, 1999. The arbitrator ordered Halifax to pay Ms. Raymond (formerly Ms. El Hitti) income replacement benefits from December 5, 1994 to March 13, 1995, less 90 percent of the net income Ms. Raymond earned during that period. The arbitrator also ordered Halifax to pay income replacement benefits from May 20, 1995 to July 31, 1995 and from March 30, 1996 and ongoing. Halifax appeals the order for ongoing benefits from March 30, 1996 and the special award of $3,500 ordered by the arbitrator.

My order was issued on December 17, 1999, with reasons to follow. These are my reasons.

II. BACKGROUND

The background facts are as described by the arbitrator. Ms. Raymond claims that she is unable to work because of ongoing neck pain, back pain, headaches and fatigue, as a result of being rear-ended on November 6, 1994. At the time of the accident, she cared for four children in her home under an arrangement with Andrew Fleck Child Care Services ("Fleck"). Two pre-school children, girls aged 22 and 32, were with her between 7 a.m. and 5 p.m. or later, depending on parents' schedules. She also provided before and after school care for two boys aged five and seven. She worked about ten hours a day, five days a week.

Halifax paid benefits for about three weeks, terminating them on December 4, 1994, when Ms. Raymond resumed looking after the two girls. The two boys had found another caregiver. Ms. Raymond's daughter-in-law, Gisele El Hitti, helped her because she was no longer able to do the job on her own, but Gisele quit in March 1995 because of her own pregnancy. Ms. Raymond found she was unable to continue on her own. In mid-March, 1995, Dr. Riad Mansour, Ms. Raymond's family doctor, advised Halifax that Ms. Raymond rest for about three weeks. On that basis, Halifax reinstated benefits effective March 13, 1995. The benefit period was later extended, but Halifax terminated benefits again on May 20, 1995, based on an Insurer Examination ("IE") report by Dr. Kate J. Stolee, a physiatrist. Dr. Stolee had reported in March that she expected Ms. Raymond to be able to return to work after three or four weeks rest.

Ms. Raymond retained counsel, who gave notice that she disputed the stoppage and requested a disability DAC assessment.¹ However, the DAC was not completed until February 1996. There were two reasons for the delay. Immediately after benefits were stopped, Ms. Raymond left the country for a vacation in June and July 1995. In any event, Ms. Raymond's new family doctor, Dr. Barry Dworkin, recommended a Functional Capacities Evaluation ("FCE"). Halifax agreed, and decided to postpone the DAC until completion of the FCE. Halifax reinstated benefits on Ms. Raymond's return, effective August 1, 1995, but refused to reinstate benefits between May 20, 1995 and August 1, 1995.

In late August 1995, the CBI reported that Ms. Raymond was unable to do her pre-accident job. A six-week Comprehensive Rehabilitation Program was recommended and approved. Discharging Ms. Raymond on November 2, 1995, the CBI reported that she was ready for a gradual return to work over a four-week period. Ms. Raymond made two brief attempts to resume her caregiving duties, but felt that headaches prevented her from continuing. Halifax terminated benefits, effective November 24, 1995, based on the CBI's report that Ms. Raymond was non-compliant with the return to work program. However, benefits were subsequently reinstated pending the outcome of the DAC.

Benefits were terminated for the fourth and last time on March 29, 1996, based on the DAC report.

Ms. Raymond applied for mediation of her claim for ongoing benefits. When mediation failed to resolve the parties' disputes, she applied for arbitration of the matter. She claimed income replacement benefits from December 5, 1994 to March 13, 1995, from May 20, 1995 to July 31, 1995, and from March 30, 1996 and ongoing. She also sought a special award.

The matter was heard over nine days in late 1998. The arbitrator heard oral evidence from Ms. Raymond, Gisele El Hitti, Patricia Bergeron (the Senior Claims Representative for Halifax who handled Ms. Raymond's claim), and Pamela Waddington (a Fleck employee). The arbitrator also heard from Dr. Mansour, Janet Sprague (a physiotherapist who treated Ms. Raymond), and Dr. Martin Gillen (a physiatrist who assessed her for medical-legal purposes). Dr. Gavin L. Shanks, a physiatrist who performed an IE on Ms. Raymond, also testified. A key witness was Ms. Christina Michalchuk-Lucas, an occupational therapist who performed an FCE on Ms. Raymond as part of the DAC assessment. Dr. Lynne MacGregor also testified. She was the physiatrist who assessed Ms. Raymond as part of the DAC assessment. In addition to the oral evidence, the arbitrator received a substantial number of expert reports.

The arbitrator found that Ms. Raymond's essential tasks included child care tasks and home maintenance tasks, a finding not challenged on appeal. She rejected the CBI's view that Ms. Raymond was functionally able to return to work by late November 1995 because the CBI had never assessed Ms. Raymond's ability to look after more than one child. The arbitrator found Ms. Raymond credible, and believed her evidence that she was unable to look after even one child. The arbitrator dismissed the DAC's conclusion that Ms. Raymond could return to work. An important finding was her rejection of Ms. Michalchuk-Lucas' conclusion that the strength demands of the job were light with occasional medium lifting demands. The arbitrator also rejected the occupational therapist's conclusion that Ms. Raymond could work at a light level. She dismissed Dr. Shanks' opinion on the same basis, since he considered her job demands to be "low level."

The arbitrator preferred Dr. Gillen's opinion that Ms. Raymond had developed disabling chronic pain syndrome secondary to her soft tissue injuries sustained in the car accident. Dr. Gillen concluded that Ms. Raymond was not competitively employable as a day care provider, full-time or part-time. Reading the decision as a whole, the arbitrator focussed on the fact that Ms. Raymond's duties and schedule as a day care provider were determined by the children's needs, not her own, as well as Ms. Waddington's evidence that Fleck would not contract with a provider who was in pain, could not lift, suffered from fatigue and needed pain medication. The arbitrator concluded that Ms. Raymond remained substantially unable to perform her essential tasks as a daycare provider, and was therefore entitled to weekly income replacement benefits for all the periods claimed, with interest.

On appeal, Halifax challenges the arbitrator's decision on three main grounds. First, it argues that Ms. Raymond's occupation as an independent home daycare provider allowed her to choose the number of children she cared for, their ages, and their hours of care. In particular, if looking after pre-school children was too difficult for Ms. Raymond after the accident, she could have looked after school-age children, who would pose fewer physical demands. Second, Halifax submits that Ms. Raymond could have modified the way she did her job in order to accommodate any physical restrictions. For example, she could use step-stools to minimize lifting requirements. Third, Halifax relies on Ms. Michalchuk-Lucas' evidence that Ms. Raymond's job posed light physical demands with occasional medium lifting requirements and that Ms. Raymond could work at this level.

III. ANALYSIS AND FINDINGS

As Ms. Raymond's application for arbitration was filed after November 1, 1996, the appeal is restricted to questions of law.² Halifax challenges the arbitrator's findings of fact, and it is not obvious that the appeal discloses a question of law. In any event, I find no error in the arbitration decision.

A. Scope of Employment and Modification of Job Tasks

Halifax submits that the arbitrator erred in defining Ms. Raymond's pre-accident employment as caring for four children, two of them pre-schoolers. Because Ms. Raymond was self-employed, Halifax argues she could have modified her job to accommodate her restrictions after the accident. As caring for older children involves fewer physical demands, this would have allowed Ms. Raymond to continue working.

There is no dispute that Ms. Raymond's arrangement with Fleck allowed her to decide how many children to look after and the ages of the children, subject to legal requirements. Pamela Waddington, from Fleck head office, testified that day care providers could care for up to five children between the ages of 3 months and 10 years. Ms. Raymond had decided well before the accident not to accept children under the age of two years.

Halifax relies on an appeal decision, Bertsouklis and Liberty Mutual Insurance Co., in which Director's Delegate Draper affirmed that "job flexibility is an appropriate consideration in assessing an insured person's entitlement to weekly income benefits." He then made the following comments:

In my opinion, If [the insured person] can do his job tasks with minimal assistance, or can accomplish them in a different way, he may not be eligible. This analysis, however, must be realistic and reasonable. For example, I would not suggest that Mr. Bertsouklis or any other self-employed person is ineligible for weekly income benefits simply because they could reassign all of their tasks to someone else. [italics added]³

In this case, Ms. Raymond's theoretical ability to adjust her job tasks was limited by economic realities. At the time of the accident, Fleck paid $20.35 per day for full day care of a child over the age of two. Varying rates were paid for school children, depending on how long they spent in care. Ms. Raymond was receiving the maximum daily rate of $10.15 for her two school-aged children. Only on professional development days or school holidays would a higher rate — $18.25 per day — be paid for full day care for school-aged children. Moreover, Ms. Waddington testified that the greatest demand was for full day care for pre-school children. Ms. Raymond's testimony was replete with her concern about maintaining her income.

The approach taken by Halifax assumes that Ms. Raymond's difficulties were limited to lifting the younger children. While all the witnesses agreed that pre-school children posed the greatest physical demands, particularly for lifting, no witness went so far as to say that caring for four or five school children under the age of ten imposed no lifting or other demands of strength. Ms. Raymond also claimed that she lacked the endurance required to do the job. The arbitrator accepted her claim, relying on Dr. Gillen's evidence that Ms. Raymond was "not competitively employable in any capacity as a child care provider, either full-time or part-time." Halifax may disagree with the arbitrator's finding, but it was one she was entitled to make based on the evidence before her.

Halifax argues that by taking in four school-aged children, Ms. Raymond would have earned " just slightly less than her previous year's average," and that she could have earned more than before if she had taken in five school-aged children. I do not accept this evidence. All else being equal, halving Ms. Raymond's daily rate for two of the children in her care must mean a significant drop in income.

Halifax argues that Ms. Raymond could have returned to work by modifying her hours of work, her activity program with the children, and the way she performed certain physically demanding tasks. Halifax's submission with respect to hours and activities did not reflect a "realistic and reasonable" analysis of Ms. Raymond's job demands. There was undisputed evidence that Ms. Raymond's hours were determined by the needs and schedules of parents and children, not her own needs. Ms. Waddington corroborated Ms. Raymond's testimony that there was some flexibility in directing the children's activities, but a caregiver must be able to supervise the children and respond to emergencies. In response to Halifax's argument that Ms. Raymond could take a rest when the children did, the arbitrator found that Ms. Raymond "could not take breaks or rest when she wanted to, but had to follow the rhythm of the children's needs." There was ample evidence for this finding, which accords with common sense.

Ms. Raymond admitted in cross-examination that she had not considered using a step stool to avoid having to lift younger children, or adopting other modification techniques. Ms. Raymond points out, however, that Halifax has never offered any assistance in teaching her how to modify her work. In any event, such modifications do not answer the question of emergencies and the endurance requirements of the job.

Fleck had required Ms. Raymond to provide a medical certificate before employing her. Ms. Waddington testified that Fleck would not employ someone with Ms. Raymond's disabilities or medication use. Halifax responded by suggesting that Ms. Raymond could look for two children privately, instead of obtaining children solely through Fleck. In that way, she could negotiate the terms of the contract on her own. However, there was no evidence that this was a realistic option, or that parents would be any more likely to entrust their children to someone with Ms. Raymond's disabilities than Fleck was.

B. The Functional Capacities Evaluation

Halifax relied on the disability DAC report prepared by Capital Vocational Specialists in February 1996. The assessors — Christina Michalchuk-Lucas (an occupational therapist), Dr. Lynne MacGregor (a physiatrist), and Dr. Denton C. Buchanan (a psychologist)⁴ — concluded that Ms. Raymond was not substantially disabled from working as a caregiver for four children. The arbitrator did not accept the conclusion of the DAC. She rejected Ms. Michalchuk-Lucas' conclusions as to the physical demands of Ms. Raymond's job and Ms. Raymond's ability to satisfy those demands. For these reasons, the arbitrator gave "no weight" to the FCE report. Halifax disputes the arbitrator's findings on both points.

The DOT and NOC classification

Halifax submits that the arbitrator erred in admitting into evidence and relying on excerpts from the Dictionary of Occupational Titles ("DOT") and the National Occupational Classification ("NOC"). Halifax argues that the documents were not properly identified and explained by an expert witness.

However, Ms. Michalchuk-Lucas' ERGOS Evaluation Report is based on the DOT strength levels (sedentary, light, medium, heavy, very heavy) and frequencies (occasional, frequent, constant). The chart entitled "Performance vs. Job Requirements" includes an explanatory note stating that the data shows Ms. Raymond's ability "compared to the Not Rated job of D.O.T. # . - ." Each entry — for example, occasional static lifting from knuckle height — includes a number that represents Ms. Raymond's actual performance and an empty parenthesis that would show the job requirement, if the job had been rated. In this context, there was nothing improper in Ms. Raymond's counsel asking why Ms. Michalchuk-Lucas had not rated the job in accordance with the DOT. Ms. Michalchuk-Lucas was familiar with the DOT. She explained that it is a database established by the United States Department of Labour. She testified that she was familiar with the entry for "Attendant, Children's Institution," identified as a medium-level occupation. She explained that she did not adopt this rating in Ms. Raymond's case because, in her view, it was not applicable to a home daycare situation, which she felt would be less demanding than institutional care.

It was in response to this approach that Ms. Raymond adduced the NOC classification for " Babysitters, Nannies and Parent’s Helpers," which also rates the job as medium, and expressly contemplates home daycare. Ms. Michalchuk-Lucas explained that the NOC system is Canadian, and replaces the former CCDO (Canadian Classification and Dictionary of Occupations). However, she testified that she was "more familiar and more comfortable with the DOT" and could not comment on the NOC’s criteria for defining job clusters and assigning numerical values for them. The NOC is the job rating system mandated for use by DACs that assess residual earning capacity.⁵ While there is no requirement that it be used by DACs assessing disability, it was reasonable for Ms. Raymond to expect an occupational therapist giving expert evidence before the Commission to be familiar with it, and no further authentication was required.

The Rating of Ms. Raymond's Job

Ms. Michalchuk-Lucas testified that she rated Ms. Raymond’s job as light, with occasional low medium requirements for lifting. She did not accept that the DOT "medium" rating applied in a home care setting. She explained that because the DOT provides generic classifications, it is sometimes necessary to consider a number of entries to find the most appropriate one. She noted that the DOT classification includes caring for disabled children. She also felt that institutional caregivers may care for more children over longer hours. The arbitrator found this was vague and "lacked an objective basis." Halifax submits that the arbitrator misunderstood Ms. Michalchuk-Lucas evidence and erred in rejecting it.

Ms. Michalchuk-Lucas did not describe her approach to job rating in her reports. In fact, the ERGOS report indicates that the job was "not rated." Her occupational therapy assessment report (prepared after a home assessment) deals mainly with Ms. Raymond's activities of daily living. Only one short paragraph describes her care giving duties, and it does not set out the physical demands of the job. No job demands analysis was ever done, and Ms. Michalchuk-Lucas admitted she had not questioned Ms. Raymond about her specific physical demands of the job.

Ms. Michalchuk-Lucas testified that her decision not to accept a medium rating for the job came out of her experience with prior assessments. No further details were provided. Considering her testimony as a whole, she appears to have focused on her view that the medium-level lifting requirements of the job were only occasional. However, she also explained that the DOT rates a job on the basis of its maximum requirements, as the ERGOS report makes clear. In any event, for purposes of entitlement to statutory accident benefits, the issue is whether the insured person is substantially unable to perform the "essential tasks" of her pre-accident occupation. Depending on the reasonable and realistic demands of the job, an occasional requirement may be an essential one. In this case, there was ample evidence — from Ms. Raymond and Ms. Waddington — that a caregiver must be able to lift younger children if necessary.

Given these difficulties with Ms.Michalchuk-Lucas' evidence, I do not agree that the arbitrator was bound to accept it in the absence of any expert evidence to the contrary. An arbitrator is required to consider the evidence as a whole. In deciding what weight to give a particular piece of evidence, an arbitrator must consider a number of factors, including internal consistency and whether there is an adequate factual foundation for the opinion expressed. Uncontroverted evidence may be rejected because it is not persuasive. That is what happened in this case.

Whether the FCE evidence was objective or subjective

Halifax disputes the arbitrator's finding that Ms. Michalchuk-Lucas relied on "her subjective belief in concluding that Ms. Raymond could work at the "light" level. Halifax submits that the ERGOS work simulator used in the FCE provides an objective, standardized assessment of a person’s functional level. Assessment tools like the ERGOS work simulator can be useful in measuring a person's functional level in the absence of an actual work trial. The difficulty with Halifax submission is that the raw (uninterpreted) results of Ms. Raymond’s ERGOS testing showed that she could only work at the sedentary level, and did not meet the requirements for light work.⁶ Ms. Michalchuk-Lucas testified that she "overrode" that result because she concluded that Ms. Raymond was not trying as hard as she could to perform the tests. She testified about numerous inconsistencies she identified in Ms. Raymond’s performance. For example, she testified that people tend to recruit additional muscles when using maximal effort, giving them the appearance of straining. She did not observe this in Ms. Raymond.

Ms. Michalchuk-Lucas testimony clearly indicated that she relied on her experience and expertise in assessing Ms. Raymond’s performance. This should not be surprising. The ERGOS machine simulates work tasks and objectively measures the work done. As Ms. Michalchuk-Lucas testified, "it is a tool that requires someone to interpret the data . . . you don't just place someone in front of the instrument and they go through on their own." Dr. MacGregor also testified about the judgment involved in interpreting the results of FCE testing.⁷ Nor does the need for interpretation, by itself, make Ms. Michalchuk-Lucas' conclusion "subjective." However, an expert must always be prepared to explain the basis for her conclusions. Ms. Michalchuk-Lucas did not explain why a result showing submaximal effort at the sedentary level implies functional ability at a higher level. The arbitrator considered this inference, and rejected it. This was a factual finding she was entitled to make, and I am not persuaded there is any basis for intervention.

Dr. MacGregor's evidence

Dr. MacGregor's DAC report, dated March 11, 1996, stated "This 47 year old woman presents 1 year and 3 months post MVA with mild myofascial bilateral neck pain with the right side being more symptomatic than the left." There was no evidence of nerve root involvement.

Dr. MacGregor concluded that Ms. Raymond was not substantially unable to carry on her essential child care tasks at that time. However, she accepted that Ms. Raymond had "some residual symptomatology" and was "somewhat pain-focussed." She recommended that Ms. Raymond use pacing techniques she had already learned. She also recommended an exercise program and pain management program.

Halifax submits that the arbitrator misunderstood Dr. MacGregor's testimony and erred in rejecting it. According to the arbitrator, Dr. MacGregor found that Ms. Raymond was credible and "had a high pain level, needed to pace herself and take breaks in her work and would not be competitively employable." [italics added]

Dr. MacGregor testified that Ms. Raymond reported "a fairly high pain level," that was higher than expected based on her observation of Ms. Raymond during the examination. Dr. MacGregor accepted that Ms. Raymond "was in some discomfort."⁸ However, the transcript supports Halifax' submission that the arbitrator erred in stating that Dr. MacGregor's found Ms. Raymond unemployable. Dr. MacGregor stated on a number of occasions during her testimony that she believed Ms. Raymond could return to work, with pacing and modifications. However, this error was not decisive. The arbitrator had other reasons for rejecting Dr. MacGregor's evidence. The most important of these was Dr. MacGregor's admitted reliance on Ms. Michalchuk-Lucas' assessment of the physical demands of Ms. Raymond's job and Ms. Raymond's functional level.⁹

Halifax submits that the arbitrator erred in preferring Dr. Gillen's evidence over that of Dr. MacGregor, Dr. Shanks and Dr. El-Sawy. In particular, Halifax relies on Dr. Gillen's admission that his opinion could change if his understanding of Ms. Raymond's job turned out to be inaccurate.¹⁰ He also admitted that he considered only the physical demands of caring for pre-school children, and that lifting requirements are "less predominant" with school-aged children.¹¹ I find no error. Dr. Gillen understood that Ms. Raymond was providing day care in her home for two pre-schoolers and two school-aged children. He acknowledged that the physical demands of the job would vary with the ages and behaviour of the particular children, but it was his opinion that Ms. Raymond lacks the "sustainable endurance" to work at any level, even at a sedentary job, for even 2-22 hours per day required for before and after school care. He insisted

Ms. Raymond is competitively unemployable because of her lack of endurance, regardless of maximum lifting requirements.

In essence, Halifax asks me to reconsider the arbitrator's findings with respect to the weight she gave to the competing opinions of the doctors. In the absence of a specific error, this is not my role on appeal.

IV. INTEREST

Halifax reinstated Ms. Raymond's income replacement benefits immediately on receipt of the arbitrator's decision dated March 8, 1999. Rather than seeking a stay, Halifax paid Ms. Raymond's outstanding benefits between March 30, 1996 and March 7, 1999, with interest calculated pursuant to section 68 of the Schedule. This payment was made pending resolution of the appeal.

Ms. Raymond raised two issues in relation to the interest on the lump sum payment. First, she challenged Halifax's claim that it calculated interest on the overdue benefits to April 15, 1999, the date they were paid. Section 68 provides that interest shall be paid "for each day the amount is overdue from the date the amount became overdue." Accordingly, interest is payable to April 15, 1999.

Ms. Raymond also submitted that because the lump sum amount was paid on a "pending dispute" basis, interest should continue to accrue until resolution of the appeal. She argued that an insurer appealing an arbitration order has three options: seek a stay of the arbitration order, pay the benefits ordered by the arbitrator unconditionally with interest to the date of payment, or pay the benefits conditionally, in which case interest continues to accrue until the payment is unconditional.

In her letter of July 28, 1999, Ms. Raymond's counsel stated that the funds remained in an interest-bearing trust account pending the outcome of the appeal. However, Halifax did not require the money to be held in trust. It placed no condition on the funds. I accept that not having sought a stay, Halifax properly satisfied its obligation to pay the benefits ordered. Accordingly, interest stopped accruing on April 15, 1999.

V. SPECIAL AWARD

The arbitrator found that Halifax acted unreasonably in respect of its termination of benefits on December 4, 1994, its further termination of benefits on May 20, 1995 (following reinstatement of benefits on March 13, 1995), and its refusal to reinstate benefits between May 20, 1995 and August 1, 1995 after Ms. Raymond requested a DAC assessment (benefits were reinstated effective August 1, 1995). Halifax ultimately terminated benefits effective March 30, 1996 based on the DAC report. The arbitrator did not find that decision unreasonable.

Halifax takes particular issue with the arbitrator's finding that it adopted "a stubborn and inflexible position" in not paying wage loss benefits (the difference between her reduced income and her pre-accident income) between December 4, 1994 and March 13, 1995. Halifax notes that Ms. Raymond did not claim wage loss benefits at that time. I accept Ms. Raymond's submission that Halifax had an obligation to advise her about the benefits available pursuant to subsection 59(2) of the SABS-1994. However, the evidence, including Ms. Bergeron's testimony and log notes, suggests that Halifax's failure to consider paying wage loss benefits was a matter of inadvertence rather than adopting "a stubborn and inflexible position." For example, Ms. Bergeron admitted in cross-examination that she failed to enquire as to whether Ms. Raymond had lost income as a result of losing two of the four children she had looked after before the accident.¹²

Halifax also submits that Ms. Raymond's counsel did not raise the issue of benefits between December 4, 1994 and March 13, 1995 until a week or so before the hearing. The pre-hearing letter indicates that only the ultimate termination of benefits in March 1996 was in dispute at that time. However, Ms. Raymond points out that the issue of the earlier termination only became apparent in late October 1998, when she finally received the adjuster's file, production of which had been ordered at the pre-hearing. Halifax conceded that it did not object to the issue going forward at the hearing and does not now argue that the matter was improperly considered.

I find no error in the arbitrator's considering the issue,¹³ but I am troubled by her strong language. While Halifax can be faulted for its handling of the file following Ms. Raymond's return to work, not every inadvertence or misjudgment by an insurer amounts to unreasonable delay meriting a special award. It is difficult to understand how Halifax can be accused of taking " a stubborn and inflexible position" about an issue that arose just before the hearing.

Halifax further submits that Ms. Raymond's entitlement to benefits after December 5, 1994 was not clear. Ms. Bergeron testified that she had no knowledge that Ms. Raymond was having any problems until February 1995, when Ms. Raymond's daughter called to explain that her mother was finding it difficult to work because of unrelated health problems. On February 23, 1995, Dr. Mansour recommended that Ms. Raymond be given assistance to allow her to continue working. It was not until March 13 that he recommended a three-week rest due to her accident-related neck problems.

However, the Initial Questionnaire Ms. Bergeron prepared on November 11, 1994 indicates that Ms. Raymond cared for four children before the accident. Ms. Bergeron's notes at that time indicate that Ms. Raymond had only two children left in her care, and her sister was looking after them until she could resume work. On cross-examination, Ms. Bergeron admitted she knew that the other two children had opted to stay in their new caregiver's home rather than return to Ms. Raymond. On December 1, Ms. Raymond told Ms. Bergeron that she was going to return to work because she feared she would lose her job, and that her daughter-in-law would help her. Ms. Bergeron also knew that Ms. Raymond continued to need medication and physiotherapy treatment after December 5, 1994, for which Halifax was properly paying. The arbitrator clearly found this evidence compelling, and she concluded that Halifax could not reasonably withhold benefits in light of it.

Previous appeal decisions have held that an arbitrator must be given considerable leeway with respect to assessment of special award, because the assessment of what is "unreasonable" conduct is dependent on the arbitrator's assessment of the facts.¹⁴ I agree with this approach. I find no error in the arbitrator's finding that Halifax unreasonably withheld benefits between December 5, 1994 and March 15, 1995.

Halifax properly reinstated Ms. Raymond's benefits on March 13, 1995, further to Dr. Mansour's recommendation. While Dr. Mansour was anxious to get Ms. Raymond back to work, he told Ms. Bergeron that she had "legitimate neck problems." On March 14, 1995, Dr. El Sawy, while finding no neurological abnormality, noted Ms. Raymond's "persistent neck ache, posteriorly and on the right side." He recommended physiotherapy, psychological evaluation, and testing for bilateral carpal tunnel syndrome. There was no suggestion that Ms. Raymond was other than genuine in her pain complaints. On March 17, 1995, Dr. Kate J. Stolee, an IE physiatrist, recommended that Ms. Raymond return to work after "three or four weeks rest." On April 3, having reviewed Dr. Stolee's report, Dr. Mansour recommended a further four weeks of benefits. Halifax continued to pay for physiotherapy and massage benefits in accordance with Dr. Mansour's recommendation, and extended Ms. Raymond's weekly benefits. On April 24, Ms. Bergeron noted that Dr. Mansour reported that Ms. Raymond was still complaining of a sore neck and he did not know what else he could do for her.

The evidence does not establish that Halifax "ignored" Dr. Mansour's recommendation that Ms. Raymond be reassessed by Dr. Stolee, only that they failed to have her reassessed. However, I find no error in the arbitrator's finding that Halifax acted unreasonably in terminating benefits without having Ms. Raymond reassessed. A doctor's expectation that an injured person will be able to return to work within a certain time is, of course, an educated guess based on the doctor's experience of similar injuries. But people respond to injuries in different ways, and assessing impairment and disability requires taking a "whole person approach."¹⁵ For this reason, insurers are generally well-advised to seek a reassessment of the insured person after the predicted period of rest or rehabilitation.

In this case, Dr. Stolee's report indicated that Ms. Raymond had genuine ongoing neck pain and stiffness, a swollen and tender sternocleidomastoid muscle, an observation also made by Isabel Staudinger, the massage therapist at the Hunt Club Chiropractic Clinic, in early April 1995. Dr. Stolee also noted "a profound sleep disruption and probable mild depression secondary to the chronicity of her pain." She found no exaggerated pain behaviours. Dr. Mansour and Dr. El Sawy also accepted that Ms. Raymond had genuine pain complaints. In these circumstances, I am not satisfied the arbitrator erred in finding that Halifax was obliged to make further enquiries as to the nature and severity of Ms. Raymond's injuries before terminating benefits.

The arbitrator found that Halifax acted unreasonably in withholding benefits between May 20, 1995 and July 31, 1995. Her comments suggest that her ruling was based on her finding that Ms. Raymond was disabled in May 1995, when Dr. Stolee assessed her, and in August 1995, when the CBI assessed her, and there was no evidence to suggest she recovered in the interim. I find no error in any of these findings of fact, which were open to the arbitrator based on the evidence.

However, the arbitrator did not consider the effect of subsection 64(14) of the SABS-1994. After receiving the stoppage notice dated May 3, 1995, Ms. Raymond retained counsel (not the counsel who represented her at arbitration and appeal) and changed family doctors. Her new doctor, Dr. Barry Dworkin, called Ms. Bergeron on May 17 to recommend a functional capacity evaluation ("FCE") at the Canadian Back Institute ("CBI"), and Halifax agreed to pay for this. Her counsel disputed the termination of benefits by letter dated May 19, 1995. However, he indicated that a DAC could not be completed until August 1995, because Ms. Raymond would be out of the country until then. On July 11, Ms. Bergeron issued an Explanation of Assessment form with regard to certain mileage, parking and prescription expenses. On July 21, she sent Ms. Raymond's medical file to the CBI, and wrote to Ms. Raymond's counsel, asking him to advise her when Ms. Raymond returned, so that the DAC could be arranged. He responded on July 31, stating that Ms. Raymond had returned. He concluded, "Kindly take the necessary steps to arrange for the Designated Assessment. Ms. El Hitti's schedule is very flexible." Ms. Bergeron notified the DAC of the requested assessment on August 18. The CBI assessment was completed on August 21 and 22, 1995. On August 21, benefits were reinstated effective August 1. Despite this ongoing correspondence between Ms. Bergeron and Ms. Raymond's counsel, it was not until August 21 that Ms. Bergeron advised Ms. Raymond that benefits would be withheld for the period of her absence. On cross-examination, Ms. Bergeron was unable to explain her failure to notify Ms. Raymond or her counsel that Halifax intended to withhold benefits during the period of her vacation.

On September 18, Ms. Bergeron wrote to the Designated Assessment Centre, requesting that the assessment be "put on hold" for four to six weeks pending Ms. Raymond's completion of the CBI rehabilitation program. Her letter concludes, "Once she has completed this we will advise you if we wish to proceed with the DAC Assessment." As the CBI program came to an end, Ms. Bergeron noted several telephone discussions with Carolyn Miller, the CBI's Program Co-ordinator. In early November, Ms. Bergeron noted that if the return to work program "doesn't work we'll be DAC'ing her." On November 16, Ms. Bergeron noted that Ms. Raymond had not started the return to work plan. The note ends, "Carolyn feels . . . she should be able to do it. We'll go with plan + DAC her." Ms. Bergeron conceded in cross-examination that Halifax elected to complete the CBI assessment and rehabilitation program before proceeding with the DAC.¹⁶

Subsection 64(14) of the SABS-1994 allows an insurer to withhold benefits for any period when the insured person does not comply with the requirements of subsection 64(9). Paragraph (b) of s. 64(9) requires the insured person who requests a DAC to "submit to such reasonable, physical, psychological and mental examinations as are requested by the person or persons who conduct the assessment." [italics added] Considering the communication between the parties between mid-May 1995 and late November 1995, and Ms. Bergeron's evidence about these events, I am not satisfied that Ms. Raymond failed to submit to an examination that was requested by Halifax. I find that Halifax decided to delay the DAC in the hope that the CBI program would help Ms. Raymond get back to work. There was nothing improper about this, but penalizing Ms. Raymond for the delay is not consistent with the purpose underlying subsection 64(14), which is to encourage prompt resolution of disputes. Therefore, I am not persuaded that consideration of s. 64(14) would have changed the outcome.¹⁷

The special award provision is intended to protect insured persons from unreasonable insurer conduct. Although it does not require a finding of malice or bad faith, a special award is not merited just because an arbitrator finds that the insurer erred in terminating benefits. The standard is one of "reasonableness," not perfection. In assessing an insurer's conduct relative to this standard, arbitrators must be mindful of the way the dispute arose. In this case, the arbitrator's special award ruling depended heavily on her assessment of the evidence, and may have been especially influenced by Halifax's reliance on the evidence of Ms. Michalchuk-Lucas and its failure to consider Ms. Raymond's job demands, considered realistically in a competitive marketplace. Although another arbitrator might have reached a different conclusion, I am not persuaded the arbitrator erred in giving a special award in these circumstances.

VI. EXPENSES

As Halifax was unsuccessful in its appeal, it shall pay Ms. Raymond's reasonable appeal expenses.

January 10, 2000

Nancy Makepeace Director's Delegate

Date

Footnotes

1. 1An assessment at a Designated Assessment Centre ("DAC") under section 64 of the SABS-1994. The SABS-1994 is the Statutory Accident Benefits Schedule — Accidents after December 31, 1993 and before November 1, 1996.
2. 2Subsection 283(1) of the Insurance Act, R.S.O. 1990, as amended November 1, 1996.
3. 3(OIC P-006499, May 28, 1996).
4. 4The arbitrator found Dr. Buchanan's assessment irrelevant because Ms. Raymond does not claim to be psychologically disabled as a result of the accident. As neither party disputes this finding on appeal, I need not discuss Dr. Buchanan's report.
5. 5Residual Earning Capacity Interim Assessment Manual (April 1998).
6. 6Exhibit 3, Tab 32, p. 3.
7. 7Arbitration transcript, December 17, 1998, p. 91, question 295, and December 16, 1998, p. 17, question 31.
8. 8Arbitration transcript, December 16, 1998, p. 28, question 44.
9. 9Arbitration decision, p. 15: "Dr. MacGregor stated that, in coming to her conclusion that Mrs. Raymond was not substantially disabled from performing the essential tasks of her employment, she relied heavily on the FCE assessment and Dr. Buchanan's report." Dr. MacGregor's report: Exhibit 3, Tab 35, pp. 2-3; Arbitration transcript, December 16, 1998, pp. 10-12, questions 22-24; pp.14- 19, questions 26-31; pp. 21-2, question 32; pp. 22-4, question 36; pp. 33-34, questions 54-57; and p. 45, question 104.
10. 10Arbitration Transcript, November 25, 1998, pp. 67-70, questions 121-126; and pp. 71-2, question 130.
11. 11Arbitration Transcript, November 25, 1998, p. 65, question 116.
12. 12Arbitration transcript, December 16, 1998, page 67, question 284.
13. 13The requirement for adequate notice of a special award issue was discussed in Royal Insurance Company of Canada and Clark, (OIC P97-00008, September 26, 1997).
14. 14Maas and State Farm Mutual Automobile Insurance Company, (OIC P96-00080, December 8, 1997), and Gan Canada Insurance Company and McConachie (OIC P97-00069, October 28, 1998).
15. 15Ruffo and Liberty Mutual Insurance Company, (FSCO A96-000989, November 10, 1999).
16. 16Arbitration transcript, December 16, 1998, pp. 82-83, questions 338-342; and pp. 87- 89, questions 357-367.
17. 17Subsection 283(5) of the Insurance Act allows an appeal adjudicator to "confirm, vary or rescind the order appealed from or substitute his or her order for that of the arbitrator."