Neutral Citation: 1999 ONFSCDRS 32

FSCO A97-001495

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

FRIMA OLSZYNKO

Applicant

and

DOMINION OF CANADA GENERAL INSURANCE COMPANY

Insurer

REASONS FOR DECISION

Before:

Nancy Makepeace

Heard:

May 19, 20, and 21, 1998, in Ottawa, Ontario.

Written submissions were received on June 3, June 30, July 8 and July 9, 1998, and on February 5, 1999.

Appearances:

William J. Sammon for Mrs. Olszynko

Nancy L. Donnelly for Dominion of Canada General Insurance Company

Issues:

The Applicant, Frima Olszynko, was injured in motor vehicle accidents on January 12 and January 18, 1994. She applied for and received statutory accident benefits from Dominion of Canada General Insurance Company ("Dominion"), payable under the Schedule.¹ On January 17, 1996, the Insurer delivered a "nil" offer of Loss of Earning Capacity Benefits ("LECBs") under Part VI of the Schedule. The Applicant accepted the Insurer's assessment of her pre-accident earning capacity as $534.70 per week, but disputed the Insurer's assessment of her residual earning capacity. In accordance with section 23(2) of the Schedule, the Insurer referred the Applicant to WorkWise, a Designated Assessment Centre, for a residual earning capacity assessment ("REC DAC"). WorkWise assessed the Applicant's residual earning capacity, under section 30 of the Schedule as $22,862.00 per year, or $439.65 per week, based on working 20 hours per week as a Retail Trade Manager.

The Applicant was the self-employed operator of a video rental outlet at the time of the accident. She did not dispute that this occupation (defined as "Retail Trade Manager" under the National Occupational Classification system) "best satisfies" her "personal and vocational characteristics," or that she is qualified to do the job, as required under s. 30(2) of the Schedule. The Applicant has returned to work since the accident on a part-time basis, but claims that she can only perform restricted duties for a few hours at a time, on a sporadic basis. She claims that she is unable to work at a productive and competitive level because of accident-related pain and anxiety.

The parties were unable to resolve their disputes through mediation, and Mrs. Olszynko applied to the Financial Services Commission of Ontario² for arbitration under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The issues in this hearing are:

What is the Applicant's residual earning capacity under section 30 of the Schedule? Based on this finding, what is the Applicant's loss of earning capacity benefit under section 28 of the Schedule?
Is the Applicant entitled to medical expenses of $1,810.33 under section 36 of the Schedule? She claimed medication expenses of $35.24, massage therapy fees of $540, acupuncture fees of $120, the cost of a treadmill ($931.49), and a travel allowance of $183.60 relating to attendances for doctors' appointments and massage therapy.
Is the Applicant entitled to housekeeping expenses of $3,450 under section 55 of the Schedule?
Was the Insurer entitled to terminate the Applicant's benefits on October 14, 1997 on the basis that she had not made herself reasonably available for an Insurer Examination under section 65 of the Schedule?
Is the Applicant entitled to a special award under subsection 282(10) of the Act?
Is either party entitled to its arbitration expenses under subsection 282(11) of the Act?

Mrs. Olszynko also claims interest on any amounts owing.

Results:

The Applicant's residual earning capacity is $22,862 per year, or $439.65 per week, as determined by the Designated Assessment Centre residual earning capacity assessment. Accordingly, she is entitled to loss of earning capacity benefits of $172.85 per week from January 19, 1996 and ongoing, indexed in accordance with section 80 of the Schedule.
The Applicant is entitled to medical benefits totalling $1,810.33.
The Applicant is entitled to housekeeping expenses totalling $3,450.
The Insurer was not entitled to terminate benefits on October 14, 1997.
Interest is payable on benefits owing under section 68 of the Schedule.
The Applicant is entitled to a special award of $5,000, plus interest, under subsection 282(10) of the Act.
If the parties are unable to agree on expenses, the issue may be resolved in accordance with Rules 73-77 of the Dispute Resolution Practice Code and Ontario Regulation 664, R.R.O. 1990, as amended by Ontario Regulation 464/96.

Motion:

The Applicant commenced an action against the owners and operators of vehicles involved in both accidents. The action with respect to the first accident was settled before trial. The action with respect to the second action was heard by a jury of the Ontario Court (General Division) between April 20 and 30, 1998. After a ten-day trial, the jury awarded no damages.

At the outset of the arbitration hearing, Ms. Donnelly moved for an order that the Applicant is not entitled to a hearing of her claim for loss of earning capacity benefits, and is not entitled to receive such benefits, because her claim with respect to her accident-related injuries has already been decided. Ms. Donnelly conceded that the doctrine of issue estoppel does not apply because the Applicant's first party Insurer was not a party to the tort action.³ However, she relied on "non-mutual issue estoppel," a doctrine which has been accepted in American courts.⁴ Ms. Donnelly conceded that Canadian courts have not accepted this doctrine, but she submitted that they have used the principle of "abuse of process" to achieve much the same result.

I dismissed the motion because the issues in dispute in the two proceedings are different. The issues before me are the Applicant's claims with respect to loss of earning capacity benefits, medical benefits and housekeeping expenses. The Applicant's Statement of Claim in the tort proceeding claimed general damages of $250,000 for pain and suffering, loss of enjoyment and the amenities of life, and did not raise any issue about medical and housekeeping expenses or loss of earnings. Indeed, section 267.1 of the Insurance Act, which applies to accidents after December 31, 1993 and before November 1, 1996, protects owners and operators from liability for economic loss. Given that the proceedings involve different issues, the doctrine of estoppel does not apply.

Given the different issues in the two proceedings, I also find no abuse of process in the Applicant's decision to proceed with the arbitration hearing in the face of the jury's verdict. In any event, the parties agreed that the verdict was inconsistent with the submissions of defence counsel, who suggested damages in the range of $22,000 to $100,000, and with the charge to the jury, in which His Honour Judge Sedgwick indicated that the range of damages for Mrs. Olszynko was $50,000 to $110,000. In early May 1998, the plaintiff moved before Judge Sedgwick for an order setting aside the jury verdict, and the decision was pending at the time of the hearing.

I accept Ms. Donnelly's submission that there would be some overlap in the evidence presented in the two proceedings. However, the Insurance Act gives an insured person an unrestricted election between commencing a civil proceeding or an arbitration proceeding for statutory accident benefits, and does not compel the insured to bring the two proceedings in the same forum where there is a civil proceeding for damages in tort.

In my view, the appropriate time for me to consider whether this proceeding was an abuse of process is after hearing all the evidence. Since the application for arbitration was filed after the legislative amendments of November 1, 1996, I have jurisdiction to award arbitration expenses to the Applicant or the Insurer. In my ruling, I noted that I would have some basis for applying the criteria set out in the Regulation at the end of the hearing. In the event, neither party made submissions on this issue.

On behalf of the Applicant, Mr. Sammon moved for an adjournment of the arbitration to another Arbitrator, on the basis that the Insurer's motion had tainted the proceeding before me. I dismissed the motion: an insured person who chooses to commence a civil proceeding for damages and an arbitration proceeding for benefits necessarily runs risks as to the timing of the two proceedings. In any event, I found that I was not biased. I noted that I heard submissions favourable to the Applicant as well as adverse evidence.

Background:

The Applicant, Frima Olszynko, is 48 years old, married and the mother of two children aged 19 and 23. She lives outside Ottawa. On January 12, 1994, she was the belted front-seat passenger in the family van, which her husband, Frank, was driving. They were rear-ended on an Ottawa street in stop-and-go traffic. No damage was done to the vehicle. The Applicant testified that she immediately felt right-sided neck pain and a burning pain down her right leg. She also developed a headache. She and her husband continued their journey, but she took a Tylenol. By that evening, her whole body was aching. The next day, she felt pain in her head, back, and shoulders. She saw Dr. E.A. Deernsted, her family doctor, complaining of neck pain, upper back pain, and lower back pain radiating to her right leg. Dr. Deernsted diagnosed a strain to her trapezius muscles and lumbar strain with right leg radiation. He prescribed anti-inflammatory and analgesic medication, heat, rest and chiropractic treatment.

On January 18, after seeing Dr. R.T. Burman, her chiropractor, the Applicant was involved in another accident. She testified that while passing through an intersection on a green light, at about 40 km per hour, her vehicle was struck by another vehicle making a left turn. The Applicant testified that her legs felt numb and her knees were like water. She said her fingers tightly gripped the steering wheel and a police officer pried them off one by one. Her son drove her home. According to the Applicant, she shook for a day or two afterwards, and had a headache that she had never felt before. She sighed constantly. She felt pain from head to toe, and her hands were sore and numb.

The second accident aggravated the Applicant's symptoms. She tried to return to work within a few weeks, but without success. She saw Dr. Burman regularly for chiropractic manipulation, ultrasound and massage therapy. In March, the Insurer retained Accu-Med Vocational Rehabilitation Inc. (" Accu-Med"), which referred the Applicant to the Canadian Back Institute ("CBI") for a rehabilitation assessment. The Applicant told CBI she suffered headaches several times a week, cervical and trapezius pain — "usually daily," constant low back pain, and daily intermittent right leg pain. The CBI diagnosed mechanical neck and low back pain, probably discogenic in origin, and suboccipital tightness and muscle spasm. The Applicant quit the six-week CBI rehabilitation programme because of increased pain after about three weeks.

In the spring or summer of 1994, the Applicant developed mononucleosis. By the fall of that year, Dr. Deernsted found her depressed, and prescribed antidepressants. She began attending Killens Reid Physiotherapy Clinic in August 1994, and this helped her to some degree. She also attended at a community fitness centre beginning in 1995.

In December 1994, Dr. C. Shamess, a rheumatologist, diagnosed fibromyalgia. This diagnosis has subsequently been confirmed by several other experts. Spinal x-rays have been negative except for degenerative changes in the cervical spine. The Applicant has also been diagnosed with anxiety, depression, and somatoform pain disorder.

In addition to the treatment modalities already mentioned, the Applicant has had massage therapy, acupuncture, laser therapy, trigger point injections, and supportive counselling. In early 1996, she attended a six-week in-patient chronic pain programme, supervised by Dr. Gillen, at The Rehabilitation Centre. The Applicant testified that she benefitted from treatment but remained unable to work.

At the time of the hearing, the Applicant complained of pain all over relating to fibromyalgia, as well as upper back pain, bilateral shoulder pain, and low back pain. She testified that her symptoms are aggravated by bending forward and by prolonged standing or sitting. According to the Applicant, she is only able to work for a few hours at a time, on her own schedule, and not at a competitive pace. She has good days and bad days, and cannot perform consistently enough to work competitively or productively. She is able to serve customers, answer the phone and reshelve videos, but cannot clean or perform any of the heavier tasks. She described her role after the accident as "babysitting" the store. The Applicant's testimony was corroborated by Rose Gallano, who was employed at Videoholics until it closed in the summer of 1997.

Pre-accident occupation:

After completing Grade 11 in Montreal, the Applicant did clerical work for a pharmaceutical company. She completed a cosmetology and electrolysis course lasting about a year, then went into the cosmetology business with her mother for about two years. Around 1972, she moved to Ottawa with her husband. She did clerical work for about two years and left to raise a family and work part-time in the family jewellery store. She left that work in the early eighties.

Around 1982, the Applicant and a friend, Lois B., started an ice cream business, initially from carts. They opened their first outlet, in downtown Ottawa, in 1984, a second downtown location in 1986, and later added a third location. The Applicant worked full-time at this business until 1992, when the business was sold.

The Insurer did not dispute the Applicant's testimony about her work with "Lois and Frima's." The Applicant and her partner sold ice cream "made from scratch" without eggs, wheat, or artificial flavour or colour. They engaged a dairy in Renfrew to manufacture the product, and worked with the dairy to develop it. The Applicant was involved in all the activities involved in operating the store, including administrative tasks, cleaning, lifting and carrying heavy tubs of ice cream ingredients, and serving customers at the counter and at tables.

In 1989, the Applicant started another business, a 2,000 square foot "Videoholics" store, beside the ice cream store. More outlets were opened in 1991 and 1992. After the accident, the Applicant and her husband regained control of the ice cream company, and operated an ice cream counter inside the Videoholics outlets. Two locations were closed in 1995, and the third one closed in 1997. The Applicant and her husband worked in all the stores. After the accident, her husband also operated a barber shop on the premises. In addition to the tasks relating to the dairy, the Applicant described her activities in the video store: choosing and ordering videos, removing returned videos from the returns bin, recataloguing and reshelving them, setting up the popcorn machine, serving customers, cleaning and administrative tasks. I heard little evidence about the number of employees on site at any given time or about the Applicant's personal involvement in various physical tasks. This made it difficult for me to assess the effect of the accident on the Applicant's ability to work.

I received little specific evidence about the Applicant's work hours before the accident. She testified that she worked 14 to 16 hours per day in the first few years of the business, but worked 2 to 14 hours, "as needed" immediately before the accident.⁵ Some of the expert reports suggest that she worked less than full-time hours before the accident. However, I do not need to determine this issue because the parties agreed on the Applicant's pre-accident earning capacity.

The test for entitlement to loss of earning capacity benefits:

Part VI of the Schedule provides that if an insured person continues to qualify for weekly income replacement benefits 104 weeks after the onset of disability, the insurer shall replace these benefits with weekly loss of earning capacity benefits ("LECBs"). The amount of benefits is 90 percent of the difference between the insured person's pre-accident earning capacity ("PEC") and her residual earning capacity ("REC").

Residual earning capacity is based on the income "the person could earn from the type of employment that best satisfies the criteria set out in subsection 30(2) of the Schedule, as follows:

The person,

i. is able and qualified to perform the essential tasks of the employment, or

ii. would be able and qualified to perform the essential tasks of the employment if the person had not refused to obtain treatment or participate in rehabilitation that was reasonable, available and necessary to permit the person to engage in the employment.

The employment exists in the area in which the person lives and is accessible to the person.
It would be reasonable to expect the person to engage in the employment having regard to the possibility of deterioration in the person's impairment and to the person's personal and vocational characteristics.

Subsection 30(3) further defines the criteria "able and qualified":

For the purpose of subsection (2), a person is able and qualified to perform the essential tasks of an employment if,

(a) the person does not have any impairment that permanently prevents the person from performing those tasks; and

(b) the person has the job skills and any license or other credentials required to perform those tasks, or could obtain those skills and the licence or credentials without significant effort.

The residual earning capacity assessment:

The Applicant was assessed at WorkWise, a residual earning capacity designated assessment centre ("REC DAC"), between July 8 and July 19, 1996. Dr. Peter Henderson, a psychologist and the leader of the assessment team, described the assessment process followed by WorkWise in accordance with the FSCO Guidelines issued under s. 26(2) of the Schedule.⁶ During the first week of the Assessment, the Applicant was examined by Mr. F. Sully, an occupational therapist, Dr. M. Acharya, a physiatrist, Ms. M. LeBrun, a physiotherapist, Mr. Norm LeBlanc, a kinesiologist, Ms. M. Jodouin, a psychometrist, and Dr. Henderson. At the end of the week, the team members concluded that the Applicant's previous career choice was "ideal" for her "intellectually, academically and from both an aptitude and an interest point of view."

The second week of the assessment was a work simulation. The occupational therapist and other assessors concluded that the Applicant could "safely" and "feasibly" work half-time (4 hours a day, 20 hours a week) as a Retail Trade Manager, "as long as she paces herself and . . . works within her physical work tolerances." The assessors dismissed related customer service occupations "due to the probable physical demands, in terms of sustained performance as well as inflexibility to accommodate reduced sitting, standing or keyboarding tolerances. For these reasons, it was concluded that the more sedentary and flexible Retail Trade Manager was the 'best fit' occupational grouping." A labour market survey in the region indicated that the Applicant could engage in this occupation on a part-time basis. The assessment of the Applicant's residual earning capacity at $22,862 was based on the FSCO wage tables, adjusted for experience and half-time hours.

The Applicant challenged the conclusions of the REC DAC on several grounds. She submitted that the WorkWise assessors failed to consider the diagnosis of chronic pain with fibromyalgia pattern, and failed to consider her psychological problems with anxiety and depression. She argued that what the WorkWise assessors labelled "self-limiting behaviours" were pacing and planning techniques for managing pain. She submitted that WorkWise failed to consider the productivity demands on a self-employed person in concluding that it was feasible for her to return to work for 20 hours a week. Finally, she challenged the adequacy of the centre's labour market survey.

Diagnosis of chronic pain and fibromyalgia:

The Applicant submitted that the conclusions of the REC DAC should not be accepted because the WorkWise assessors did not take into account the diagnosis of fibromyalgia, or chronic pain with fibromyalgia pattern. She relied on the evidence of Dr. Martin Gillen, a physiatrist, who first saw her in August 1995. Dr. Gillen diagnosed chronic pain syndrome with fibromyalgia pattern, secondary to myofascial pain syndrome (diffuse pain resulting from soft tissue injuries) and general anxiety disorder. Fibromyalgia was first diagnosed by Dr. C. Shamess, a rheumatologist, in December 1994. The diagnosis was supported by several experts, including Dr. N.C. Natarajan, a general practitioner specializing in chronic pain,⁷ who treated the Applicant's pain on referral from Dr. Gillen from September 1996, and Dr. Anil Jain, who saw the Applicant in consultation with Dr. Natarajan in early 1997. Dr. Kate J. Stolee, a physiatrist, also diagnosed fibromyalgia when she assessed the Applicant at the Insurer's request in September 1995. Dr. Stolee opined that the Applicant had sustained mild soft tissue injuries to her cervical and lumbar spines in the motor vehicle accidents, then developed fibromyalgia "possibly as a consequence of her inactivity."

In fact, the only expert who dismissed the diagnosis was Dr. M.J. Agapitos, a physiatrist, who assessed the Applicant at the Insurer's request in November 1994. Dr. Agapitos attributed the Applicant's diffuse muscle tenderness, fatigue and other symptoms to post-mononucleosis syndrome.

The WorkWise report did not clearly accept or reject the fibromyalgia diagnosis. Dr. Acharya, a physiatrist, and Ms. LeBrun, a physiotherapist, noted the Applicant's report of diffuse body pain varying in severity and location from day to day, and diagnosed "diffuse body pain with significant deconditioning. This would generally limit her ability to do physical activities which involve movement of the neck, lower back, and shoulders, as well as the duration for which she would be able to sustain such activities." Dr. Acharya reported that the Applicant had "a significant number of fibromyalgic tender points with supersensitivity to light touch." She noted that "[s]ome non-fibromyalgic areas were also tender." On cross-examination, Dr. Henderson testified that he had no problem with Dr. Gillen's diagnosis of chronic pain syndrome with fibromyalgia pattern.

The overwhelming evidence that the Applicant is tender diffusely, and not only in the recognized fibromyalgia tender points, gives rise to some doubt about the fibromyalgia diagnosis. However, it is not within an Arbitrator's mandate or expertise to decide on a medical diagnosis. In any event, I find that the WorkWise assessors considered the Applicant's fibromyalgia — or fibromyalgia-like symptoms — in considering whether she could work as a Retail Trade Manager. A diagnosis of fibromyalgia or chronic pain syndrome neither precludes nor guarantees entitlement to loss of earning capacity benefits.⁸ The experts who diagnosed fibromyalgia agreed that the Applicant is able to work, with some restrictions, on a part-time basis. They disagreed about how many hours she can work each week on a sustained competitive basis. The experts relied on their experience in making these predictions, and none claimed to have any objective way to ascertain the Applicant's functional abilities based on a diagnosis of fibryomyalgia.

Anxiety and depression:

The Applicant submitted that the REC DAC assessment failed to consider her psychological impairments. In June 1995, Accu-Med referred her to Dr. Selwyn M. Smith, a psychiatrist. Dr. Smith saw the Applicant about every three or four weeks between June and October 1995. He reported that she demonstrated "clear and convincing symptomatology of a generalized anxiety disorder," "dysthymia or depressed mood," "panic disorder" and somatoform pain disorder. Dr. Smith believed that the Applicant's chronic pain was "a variant of her depression and was being exacerbated by her underlying depression and anxiety." He prescribed antidepressants and counselling. Dr. Gillen postponed the Applicant's commencement of the programme to give her a chance to work with Dr. Smith to bring her anxiety under control.

Dr. Smith had seen the Applicant for several sessions before the accident with respect to a family problem. He stated in his report:

At that time, Mrs. Olszynko did not display the clinical picture that was prevalent at the time of my most recent examination on the 7th of June, 1995, in connection with her motor vehicle accident. Indeed, her clinical presentation was in striking contrast, as was her physical appearance.

On cross-examination, Dr. Henderson agreed that Dr. Smith was in a good position to assess the contribution of the accident to the Applicant's psychological problems. The Insurer presented no evidence of pre-accident psychological problems. Nor is there any question of co-factors creating psychological impairment. The only real issue in this case is to what extent, if any, the Applicant's residual psychological symptoms affect her residual earning capacity.

On cross-examination, Dr. Henderson stated that he accepted Dr. Smith's opinion, and agreed with him that the Applicant was not malingering. He conceded that the Applicant's psychological problems would make it more difficult for her to manage her pain. However, when Dr. Henderson assessed the Applicant, a year after Dr. Smith saw her, it was his opinion that the Applicant's symptoms of anxiety and depression fell short of the recognized diagnostic criteria.

Dr. Henderson admitted that the Applicant was not assessed by a psychiatrist or given an anxiety inventory at WorkWise.⁹ He conceded that she displayed moderate depressive symptoms. However, his review of the document file indicated that the Applicant's anxiety and depression had improved through her treatment with Dr. Smith. I agree. Dr. Smith's reports to Accu-Med in September and October 1995 indicate that the Applicant's mood was "relatively good," her anxiety was reduced "although still considerable" and her panic attacks were only "occasional." Dr. Smith noted a "definite improvement." Though Dr. Smith's medical-legal report for Mr. Sammon in October 1995 emphasized the Applicant's "significant psychological difficulties since the accident," his reports to Accu-Med were more optimistic.

I am not persuaded that the WorkWise assessors disregarded the Applicant's psychological problems. The assessment was based on a two-hour clinical interview by Dr. Henderson, a psychologist, and two days of psychometric testing by Ms. Jodouin, a psychometrist, who administered two days of psycho-vocational testing. Their conclusion was summarized as follows:

Ms. Olszynko does not presently meet diagnostic criteria for depression or anxiety disorders. She does demonstrate a pronounced focus on physical symptoms, incapacity and pain. She is intolerant of her pain as well as her reduced functional ability. Her inability to be and function as she was is fundamentally unacceptable to her, threatens her and serves to generate distress. She is reactive to her symptoms and easily overwhelmed by them and displays a pronounced pain and disability focus. Her presentation meets diagnostic criteria for pain disorder associated with both psychological factors and a general medical condition.

I find this analysis of the Applicant's psychological and personality make-up consistent with the overwhelming consensus of medical opinion. In my view, the WorkWise assessors' conclusion that the Applicant was not disabled by anxiety or depression in June 1996 was consistent with Dr. Smith's view, in September and October 1995, that the Applicant's psychological symptoms were improving. I am not persuaded that any residual psychological symptoms impair the Applicant from performing her tasks as a half-time Retail Trade Manager.

"Pacing" or "Self-limiting"?

The Functional Assessment Evaluation at WorkWise revealed that the Applicant had limited mobility in her neck, shoulders, and thoracolumbar spine. However, Ms. LeBrun, the physiotherapist, noted several signs that the Applicant's pain complaints were not related to any organic injury — for example, the Applicant reported pain on "gentle, passive intervertebral pressures on the cervical, thoracic and lumbar spine." It was determined that the Applicant's vocational activity was limited by "a strong pain-focus" and "self-limiting behaviours . . . in all aspects of physical functioning." Ms. LeBrun concluded that the Applicant met the physical demands for sedentary work with regard to sitting and standing tolerances, but did not meet the criteria for dynamic lifting and walking. However, it was not possible to assess the Applicant's functional level with respect to stooping, kneeling, crouching and squatting, because of the Applicant's self-limiting behaviour.

The assessors made the following comments about the Applicant's pain behaviours in their report:

Ms. Olszynko was cooperative throughout the assessment process. She was punctual and compliant. She did demonstrate self-limiting behaviours throughout the first week. In a feedback session at the conclusion of Week 1, the basis of these self-limiting behaviours was explored. Pain, fatigue and fear of injury were cited by Ms. Olszynko as obstacles to performance. In an effort to optimize the clarity of the assessment outcome, she was provided with encouragement and reassurance as to the safety of the Week 2 assessment procedures. Overall, the results of this assessment are felt to be valid, based on varied performance across the 2 weeks of the assessment.

Dr. Henderson testified that the Applicant was "very cooperative," "bought into the process," and did better in the second week, after she was reassured that the assessment would not put her at risk.

I find the WorkWise assessment to be consistent with other reports that the Applicant displayed non-organic signs, and was "dramatic" or "histrionic," pain-focussed, self-limiting, a symptom magnifier, and more able than she perceives herself to be.¹⁰

The parties disagreed about the implications of a finding of "self-limiting behaviour." Dr. Gillen testified that the phrase is often used judgmentally to indicate the patient can do more than she admits to. He described this as "way too far a reach." He testified that a patient who limits her activities may be following pain management techniques of pacing and planning, which recommend limiting activity before it becomes painful. Dr. Gillen felt that pacing was very important for the Applicant. Considering the pattern of her activity over the six weeks of the chronic pain programme, Dr. Gillen felt that it was "on balance" consistent. Dr. Henderson agreed, on cross-examination, that people who have been taught pacing and planning could be described as self-limiting.

Based on the overwhelming evidence of the medical and rehabilitation experts, I accept that the Applicant can do more than she believes she can, and that she tends to focus on pain and disability, especially when being assessed. I do not think that she is malingering or consciously exaggerating her symptoms for the purpose of gaining benefits. Nor do I accept the Insurer's submission that inconsistencies in the Applicant's evidence raise significant doubts about her credibility. However, I also do not accept that the Applicant's self-limiting behaviours are equivalent to "pacing and planning" her activities, because there is ample evidence, from Dr. Gillen and others, that the Applicant is unable or unwilling to "pace and plan." I accept the REC DAC's finding that the Applicant is excessively focussed on pain and disability because of personality and psychological factors. This does not preclude entitlement in the absence of a finding of malingering, but it forces me to look elsewhere for more reliable evidence of the Applicant's functional level. In this case, that evidence comes from a number of experts who have recommended that the Applicant return to work, and from the Insurer's surveillance evidence of December 1995 and January 1996.

Productivity and competitive self-employment:

The Applicant submitted that in finding her able to work for 20 hours a week, the WorkWise assessors did not consider that a self-employed person must sustain a productive and competitive level of work in order to keep the business alive. This issue has been discussed in a number of arbitration decisions with respect to weekly income benefits under the 1990 Schedule. The leading case is Fleming and Wawanesa Mutual Insurance,¹¹ in which Arbitrator Naylor made the following comments, with which I concur:

The regulations contemplate inability to perform the duties of remunerative work. The performance of essential tasks must incorporate the ability to perform such tasks in a manner, at a speed or for a time that renders such performance capable of being remunerative.

This approach reflects the difficulty of determining when partial disability becomes "substantial inability," entitling the insured person to weekly income benefits. Loss of earning capacity benefits were introduced in the 1994 Schedule in order to provide a more precise assessment of residual partial disability. In this case, the Insurer accepts that the Applicant has suffered a loss of earning capacity: the only question is "how much?"

The parties disagreed about the impact of the fact that the Applicant is self-employed. The Insurer submitted that being self-employed gives the Applicant greater flexibility in terms of her hours and tasks at work. The Applicant submitted that because she is self-employed, she cannot simply "put in the hours" but must sustain a high quality of work in order to maintain a competitive income.

The Commission's REC DAC Guidelines make no reference to an insured person's status as employed or self-employed. The Insurer submitted that a REC DAC is bound by the FSCO Guidelines and has no mandate to consider the implications of self-employment.¹² The Applicant submitted that Arbitrators are required to consider Commissioner's Guidelines, but are not bound by them.¹³

Previous arbitration and appeal decisions have established that an adjudicator is not bound by a DAC report, but must consider the report in the context of all the expert and other evidence presented. In Walker and State Farm Mutual Automobile Insurance Company,¹⁴ Arbitrator Rotter considered the insurer's submission that she was bound by the conclusion of the Medical and Rehabilitation DAC:

I do not accept this submission of the Insurer. In my view, the evidence of a DAC assessor is and remains opinion evidence, which I must weigh carefully in coming to any conclusion. The weight to be accorded any such evidence must be in the discretion of the adjudicator, based on a careful evaluation of the thoroughness, relevance, neutrality and value of the opinion provided. Such factors as, for example, the familiarity with the details and history of a particular case, the length and thoroughness of the examination, and the particular area of expertise of the evaluator must all be carefully assessed. Ultimately, the arbitrator has the responsibility of considering all the evidence — not just the evidence from the DAC — and making a final determination based on his or her best judgement. It is not sufficient to simply accept or adopt the judgement of the DAC assessor, who does not have the legal responsibility or opportunity to hear and weigh all the available evidence in a particular case.

The Legislature has ultimately given the statutory decision-making authority to the arbitrator. I find it would be an abdication of that authority or an inappropriate fettering of discretion to accept the opinion of a DAC assessor in lieu of exercising the authority conferred on me.

I concur with this approach, which was confirmed by Director's Delegate Draper on appeal.

In any event, I find nothing in the Schedule or the REC DAC Guidelines which precludes a DAC from considering self-employment in selecting "the type of employment that best satisfies the criteria" set out in subsection 30(2). Those criteria include that the person "is able and qualified" to perform the essential tasks of the employment and that "it would be reasonable to expect the person to engage in the employment having regard . . . to the person's personal and vocational characteristics." I find that a person's history of working as a self-employed retail manager is a "personal and vocational characteristic" to be considered under subsection 30(3).¹⁵ Moreover, I find that the phrase "type of employment" in section 30 must be read in the context of the Schedule as a whole, including section 5, which says:

For the purpose of this Regulation, a person is employed if, for salary, wages, other remuneration or profit, the person is engaged in employment, including self-employment, or is the holder of an office, and 'employment' has a corresponding meaning. [emphasis added]

Accordingly, "employment" should be read in section 30 to include "or self-employment."

In any event, I find that the REC DAC assessors recognized the Applicant's duties as "a Manager/Owner" of a video store, and did not simply assess her ability to "babysit the store," as the Applicant suggested. The WorkWise occupational therapist assessed the Applicant's "workplace tolerance and sustained activity tolerance." He reported her pain complaints, and commented on her productivity and work pace, as well as attendance ("raw hours" in Dr. Gillen's phrase). He concluded that she had demonstrated "an average workplace tolerance of 6 hours and 40 minutes. Productivity during the week averaged 4 hours and 11 minutes daily." The Applicant was found capable of sustaining an activity for between 10-15 minutes and 37 minutes, and "[h]er productivity and work pace during such activity was generally in the competitive employment range." WorkWise also assessed specific activity tolerances. The Applicant could sit for ten minutes on a recurring basis, and for a maximum of 40 minutes. She could stand (dynamic standing) for a maximum of 20 minutes, and 5-10 minutes on a recurring basis. She did not tolerate stationary standing well, especially when forward reaching and using her arms. The assessors accepted that she could not perform prolonged sitting, standing or keyboarding. In finding that the Applicant could work four hours a day, five days a week, the WorkWise assessors emphasized the importance of pacing and working within her work tolerances.

In my view, the WorkWise assessors considered competitive productivity demands in assessing the Applicant's residual earning capacity. Moreover, I find that their conclusions are consistent with the evidence of all the experts who have assessed the Applicant, including most of her own doctors. Applying the criteria set out in Walker and State Farm, I also find that the REC DAC report was impartial, thorough and expert.

Other medical evidence of work-readiness:

The Applicant relied on Dr. Gillen's assessment of her functional level in the Rehabilitation Centre's six-week in-patient pain management programme in January and February, 1996. Dr. Gillen testified that the purpose of the programme is to increase the participant's level of function, to allow her to regain control through pain management. He summarized the outcome as follows:

In terms of her participation there did appear to be some substantial increase in level of endurance. She also subjectively reported an increase in coping and in an improved outlook with regards to her pain management and understanding of it. She appeared to improve in the parameters of pacing and planning as well as improve to some degree in terms of body mechanics and posture. There had been a substantial improvement in the amount of down time. Relaxation techniques remained difficult for her, but there had been some improvement. She was reporting only slight to moderate improvements in flexibility [and] endurance and very limited improvement in strength parameters. She was reporting improved involvement in family and household management issues, improved capacity in terms of transportation, as well as a substantial improvement in work role. There was also a significant reduction in pain behaviour.¹⁶

Dr. Gillen reported that at discharge the Applicant planned to try to return to work, and could perform about three to four hours of activity per day. In May and June, the Applicant returned to Dr. Gillen. He felt that she was having difficulty pacing, and that she was experiencing fluctuating levels of pain. In August 1996, the Applicant told Dr. Gillen that she had a severe flare up of pain for one or two weeks after the WorkWise assessment.

Dr. Gillen testified that he recommended that the Applicant try to return to work, and felt that she could work at sedentary to light duties for an average of about 15 to 18 hours per week. However, he did not feel this was enough to make her employable. Apart from the question of "raw hours," Dr. Gillen did not feel she was competitively employable, defining "competitive" as able to perform "in a highly productive way in a busy environment, consistently and independently on a daily basis sustained over weeks and months." He felt that she could assist with a family-based business in a very flexible environment.

I found both Dr. Gillen and Dr. Henderson to be knowledgeable and impartial in their assessments of the Applicant. Dr. Henderson supervised the Applicant's two-week REC DAC assessment; Dr. Gillen supervised her six-week in-patient pain management program and continued to see her afterwards. Each recognized the other's expertise. They differed little in their findings about the Applicant's symptoms and diagnosis. They agreed that she is able to work part-time, but not full-time, and differed little about her potential hours of work.

In addition to Dr. Gillen, a number of the Applicant's other doctors have recommended that she return to work. As early as March 11, 1994, a little over a month after the second accident, Dr. Deernsted advised Accu-Med that the Applicant would be able to return to work in about six weeks. Dr. Shamess recognized that "[t]here is no reliable objective way to determine disability in fibromyalgia," but, in May 1995, he recommended that the Applicant "attempt at least to return to work" [emphasis in original] at "part-time light duties with the assistance of an Occupational Therapist and counselling with regard to pain management techniques." He cautioned that "one must be prepared for the eventuality that even light duties will prove challenging." In September 1995, Dr. Smith reported that there is "no significant psychiatric contraindication" to the Applicant's attempt to return to work on a gradual and flexible basis. The next month, he reported that she had "been involved for approximately two to four hours per day."

In February 1997, Dr. Natarajan felt that the Applicant was unable to work in any employment. When she prepared her report of January 1998, she reported that the Applicant had started working with her husband half an hour or an hour at a time. Dr. Natarajan recommended that she continue to do so and gradually increase her hours. At the hearing, Dr. Natarajan testified that the Applicant "can definitely work," and should start working two or three hours a day, three days a week, with no heavy lifting or carrying, or repetitive bending. She felt that the Applicant could not work for someone else, but must be able to pace herself. She testified that the Applicant could not work competitively on a full-time basis, and may never get beyond fifteen hours a week. In her opinion, the Applicant has plateaued.

The experts retained by the Insurer have also found the Applicant ready for part-time work. In November 1994, Dr. Agapitos reported that the Applicant could resume sedentary or light work. He recommended that she resume her pre-accident activities on a gradual basis. A month later, the Action + Physiotherapy FCE, requested by Accu-Med, recommended "[a] gradual return to work . . . on a part time basis (2 to 3 days per week) over the initial 4 to 6 weeks." The physiotherapist found that the only restriction was in bending, and recommended that the Applicant use a reacher or a chair, or a modified bend in reaching below 17 inches from the floor. The Applicant displayed a standing tolerance of 5-10 minutes in static position and up to 60 minutes dynamically; sitting tolerance was 45-60 minutes. In September 1995, Dr. Stolee felt that despite her fibromyalgia, the Applicant was physically capable of returning to modified work on a slowly graduated basis, starting with one hour a day, three days a week. Dr. Stolee predicted that the Applicant "will always have difficulty in any repetitive bending or reaching tasks and may require permanent modifications or permanent limitations in performing these tasks."

Accu-Med's first occupational therapy assessment was conducted at the video store in March 1994. The assessor found that the Applicant had difficulties with reaching into the returns bin to obtain videos at the bottom of the bin, bending to reach the lower display shelves, tilting her head to read the labels, using the computer (which was too low), reaching the highest display shelves, and using the commercial vacuum. The occupational therapist recommended use of a reacher, adjustable-height rolling stools, a trolley cart, and modification of the computer station. The Applicant was advised to pace herself, avoid static standing, and engage in a work conditioning programme. In February 1995, Dr. Deernsted released the Applicant for part-time modified work, with occupational therapy and psychological assistance. Accu-Med began trying to arrange an appropriate return to work programme. However, the Applicant felt that she was unable to return to work. In May 1995, Dr. Shamess agreed with the recommendation that the Applicant attempt to return to light work. A second occupational therapy job site assessment was conducted in May 1995. The therapist reported that she surmised that the Applicant did not want to return to work because of "her repeated statements of inability." In August 1995, following the reports of Dr. Agapitos and Dr. Smith releasing the Applicant to work, Accu-Med's occupational therapist met with the Applicant to discuss a return to work programme. At this point, the relationship between the Accu-Med consultants and the Applicant and her husband broke down, and the Applicant insisted she could not return to work. However, the Applicant did agree to try a gradual return to work.

Accu-Med's plan was based on Dr. Stolee's recommendation and would have increased the Applicant's hours from 3 per week (one hour a day for three days) to 30 hours per week (six hours a day, five days a week) over nine weeks. The Applicant did not complete the programme. She told Accu-Med that she was trying to return to work (paperwork, inventory, ordering), but had twice lost the time sheets she was given. The Applicant testified that Accu-Med's approach was to get her back to work regardless of her pain and disability, and that she tried to explain to them that she had fibromyalgia, had good days and bad days, and could not work consistently. She went into work, but only with her husband; she answered the phone, and reshelved the new releases, but she didn't do any physical work.

The Applicant's failure to participate in Accu-Med's return to work programme does not necessarily indicate that she does not want to return to work or to co-operate with rehabilitation efforts. The Applicant is evidently an independent, self-directed person who resented Accu-Med's intervention and wanted to control her return to work herself. Unfortunately, in the absence of time sheets or some other documentation of the Applicant's return to work efforts, I have little specific evidence about what the Applicant could and couldn't do in January 1996, when she became qualified for loss of earning capacity benefits. What I do have are the opinions of all the experts who have assessed her as capable of a gradual return to part-time work within months of the accident.

Surveillance Evidence:

The Insurer relied on two surveillance videotapes prepared on behalf of the third party insurers over 13 days in April 1996, December 1996, January 1997 and June 1997. On most days, the Applicant is observed doing brief personal errands. However, she is observed at work in the video store between about 11:00 a.m. and about 5:00 p.m. on three days in December 1996 and January 1997, and for shorter periods on several other days. While in the store, she spends most of her time standing behind the counter doing paperwork and serving customers. She is observed speaking to customers, her husband and a friend in a relaxed and animated way, showing full mobility of her upper body. She bends to the floor or lower shelves on several occasions without any sign of discomfort. On several occasions while not in the store, she is shown lifting parcels that appear to be light in weight — her cat, a large bundle of toilet paper or paper towel rolls, and a box of ice cream cones. She is shown walking briskly for short distances. I cannot accept the Applicant's testimony that the videotapes portray "a pained woman," sometimes shuffling and leaning on the counter. I see no sign of pain, stiffness or restricted movement, with one exception.

There is an ice cream freezer in the video store. At about 5:30 p.m. on December 11, 1996, the Applicant is seen bending over a low counter near the ice cream freezer for about half an hour. At the hearing, she testified that she was cutting a bagel for something to eat. I observe that she cuts a number of bagels, then parcels them, half a dozen at a time, into plastic bags, and puts them in or near the freezer, probably for sale. However, I do note that she straightens up slowly after finishing her task, and walks away slowly and stiffly. At 6:00 p.m., she leaves the store with her husband, having been at work since 11:00 a.m. This is the single occasion when I observe any sign of stiffness, fatigue or pain. I accept that the Applicant was tired and stiff at the end of the work-day.

Cross-examined about the surveillance videotapes, Dr. Gillen candidly admitted that while he saw the Applicant after the videotapes were prepared, he had not known she was working during this period, though he knew that on completing the pain management programme, she intended to try returning to work. He admitted that the Applicant seemed more flexible than he expected, appeared to have no difficulty with any of her movements, though she may have been slow in cutting a bagel or scooping ice cream, and showed no pain behaviour except for, possibly, playing with an elastic band. In my view, the Applicant's fidgeting with the elastic band was just fidgeting. Except for the incident already noted, I found nothing unusual in the speed of her activities. In fact, as Dr. Gillen recognized in his report, her movements, especially of her head and upper body, are quite rapid. Even if, as the Applicant testified, she is naturally animated in conversation, the point is that pain or injury is not limiting her mobility. Dr. Gillen admitted that it was as a result of seeing the surveillance videotapes that he formed the opinion that the Applicant could work 15-20 hours a week, though he maintained his earlier view that she is not competitively employable.

Dr. Natarajan testified that after seeing the Applicant on November 20, 1996, she saw her nine times in January 1997. The Applicant was upset, and complained of increased pain and fatigue. On examination, Dr. Natarajan felt increased muscle spasm in the Applicant's neck, as well as spasm in her right scapular area, right cervical and lumbar spine, and skull. However, on cross-examination, the Insurer's counsel noted that Dr. Natarajan's report of February 27, 1997 and her clinical notes for this period do not refer to the Applicant's returning to work in December and January. Dr. Natarajan was unable to recall whether she knew about this. I note, as well, that Dr. Natarajan saw the Applicant ten times in October 1996, which suggests either that the Applicant was working similar hours then, or she was not working but having the same symptoms.

The Applicant pointed out, in her testimony, that the videotapes did not show the periods of pain and disability that followed the three days in question. The tapes did not show her laying down for a while in a back room, as she said she did on one of the days, and they did not show her taking medication to get her through the day. The Applicant also testified that she was forced to work during this period because Ms. Gallano was away for vacation over Christmas; Ms. Gallano corroborated this evidence. The Applicant also stated that she was highly motivated to put in as many hours as possible, because she was trying to get the business back on its feet. Finally, Mr. Sammon asked me to note, on the Applicant's behalf, that Dominion chose not to rely on the surveillance it had commissioned over a twelve-day period in which the Applicant was active on only two days, neither of them at work. I accept that the surveillance tapes that were presented to me represent only a small sampling of the Applicant's activities.

This case presents an evidentiary problem that is all too common. The Applicant claims that she is able to work only sporadically, and cannot sustain competitive hours and productivity. Her doctors and the Insurer's experts have recommended that she return to work on a gradual basis, starting with minimal part-time hours. The Applicant has resisted these recommendations, claiming that they do not recognize the severity of her disability. The Applicant disputes the REC DAC's finding that she can work 20 hours a week, and takes the position that she cannot consistently return to work on any basis. Because of her refusal to participate in a structured return to work programme, such as the one put forward by Accu-Med, there is no objective evidence of her ability to work for a sustained period.

The surveillance evidence shows that for at least three days, two of them during the same week, the Applicant was able to work between 11:00 a.m. and about 5:00 p.m., which is approximately the same shift she worked before the accident. The surveillance does not prove to a certainty that the Applicant can work the 20 hours determined by the WorkWise assessment on a consistent basis. However, the Applicant bears the onus of proving her entitlement to LECBs at a higher benefit than determined by the REC DAC. In my view, the significance of the surveillance is that it shows that the Applicant's tolerances for standing and other work activities, and for sustained productivity, are much greater than what she has reported to WorkWise and the other assessors. The paucity of other objective evidence of disability forces me to extrapolate from the evidence I have. The bottom line is that the surveillance seriously undermines the Applicant's claim.

The labour market survey:

The WorkWise report stated that a labour market survey for the Ottawa-Carleton region indicated there were 99 positions within the Retail Trade Manager grouping. On cross-examination, Dr. Henderson conceded that this conclusion was based on a search of computerized databases, including a local Ottawa resource and the Human Resources Development Canada database. WorkWise did not contact employers or conduct a job search. Dr. Henderson was unable to say whether the 99 positions were full-time or part-time, but he conceded that they were probably full-time. Nor could he state that these positions would allow for flexible duties and hours. The Applicant submitted that the Insurer led "no convincing evidence" that "part-time employment was available or accessible" in the Ottawa area.

The problem with this submission is that there is no evidence that part-time employment in retail "best satisfies" the criteria set out in section 30 of the Schedule. The Applicant has expressed no interest in working for someone else. The overwhelming evidence in the case indicates that self-employment is ideal for the Applicant, considering her experience, personality, skills, and her need for flexible hours and duties.

Dr. Henderson also testified that WorkWise did not assess opportunities for self-employment because of its understanding that the REC DAC guidelines are based on employment rather than self-employment. However, in this case, there is no question that part-time work as a video store owner/manager was available and accessible to the Applicant in the Ottawa area, because in fact the Applicant continued to operate the video store until 1997. I heard no evidence that the store went out of business for reasons connected to the accident.

The labour market survey conducted by WorkWise might not be adequate in every case. In this case, I am persuaded that the Applicant is able to work 20 hours a week as a self-employed Retail Trade Manager, and that this type of employment "exists in the area in which [the Applicant] lives and is accessible to [her]."¹⁷

Conclusion: loss of earning capacity benefits

I accept that the Applicant is able to work for 20 hours a week as a Retail Trade Manager with minimal restrictions that do not compromise her productivity. Based on the FSCO Wage Tables for 1996, her residual earning capacity is $22,862, or $439.65 per week. The Insurer did not dispute the Applicant's calculation of her net weekly income, pursuant to subsections 30(1) and 81(1) of the Schedule, as $342.64.¹⁸ Her benefit, calculated under subsection 28(1) of the Schedule, is 90 percent of the difference, or $172.85, indexed in accordance with section 80 of the Schedule.¹⁹

Benefit payment pending dispute resolution:

The Applicant submitted that the Insurer was not entitled to reduce her weekly benefits, but should have continued to pay income replacement benefits of $534.70 a week, pending receipt of the REC DAC report. She relied on subsection 23(8) of the SABS, which read as follows at the time of the accident:

Subject to subsections (5) and (6) and to subsection 281(4) of the Insurance Act, the insurer shall continue to pay benefits under Part II, section 15, Part IV or Part V pending resolution of a dispute under subsection (3) or (4), if the person continues to qualify for those benefits.

Since IRBs are paid under Part II, this meant that an insurer could not reduce an insured person's IRBs to the LECB rate until resolution of any dispute about the LECB rate.

By the time the Insurer made its LECB offer in January 1996, subsection 23(8) had been replaced by a new provision:

Subject to subsection (6) and to subsection 281(4) of the Insurance Act, the Insurer shall continue to pay benefits under Part IV or V pending the resolution of a dispute under subsection (3) or (4), if the person continues to qualify for those benefits.

The effect of the amendment was to delete IRBs from the pay pending resolution requirement. The Insurer relied on this provision to reduce the Applicant's benefits from $534.70 per week (IRBs) to $153.37 per week (LECBs) effective January 19, 1996.

There has been some dispute about whether this amendment, which took effect on January 1, 1995, applies to cases where the accident occurred in 1994 but the LECB offer (at 104 weeks) was made after the change. The Applicant relied on Lehman and GAN Canada Insurance Company,²⁰ in which Arbitrator Allen held that the applicant's rights had crystallized before the 1995 amendments, which therefore did not apply to him. Director's Delegate Draper reversed this decision on appeal.

In Vo and Maplex,²¹ Director Sachs made the following comments:

Binding precedent on the interpretation of the Schedule and Act does exist in the administrative tribunal created by the Legislature as alternative adjudicative system for the resolution of disputes over statutory accident benefits. Decisions of the Director, to the extent they cannot be distinguished²² are binding on the arbitrators. Flexibility and the application of precedent are not mutually exclusive. To hold otherwise would deprive the appeal process of its logical purpose.

An appeal is not a right of "reconsideration" as generally understood in administrative law, nor is it a right to a hearing de novo. The Director may undertake new hearings, but this involves primarily questions of fact, not law. Where a Director's decision formulates a rule on the interpretation of the statutory provisions under which claims for benefits are made, that interpretation is binding on the first instance adjudicators. If the interpretation is to be properly challenged, an application for judicial review is required.

I find that I am bound by the appeal decision in Lehman and GAN Canada Insurance Company. Accordingly, the Insurer was entitled to reduce the Applicant's benefits to the LECB rate, based on its offer, effective January 19, 1996.

Medical and housekeeping benefits:

The Applicant claimed expenses for massage therapy (nine treatments costing $60 each), acupuncture ($120), medication ($35.24), purchase of a treadmill ($931.49), and a travel allowance of $183.60 for massage therapy and medical attendances (1,360 km at 132 cents per km). These claims were made pursuant to section 36 of the Schedule, which provides medical benefits, including medication, transportation and "other goods and services of a medical nature." She also claimed housekeeping expenses of $3,450 (46 visits costing $75 each) under section 55 of the Schedule.

The Insurer made no submission as to whether these expenses claimed were "reasonable expenses" incurred "as a result of the accident." The Insurer relied solely on subsections 65(1) and 65(5) of the Schedule, which provide that an insurer is not required to pay medical benefits claimed for the period when the insured person refuses to make herself reasonably available for an Insurer Examination ("IE").

Insurer examination:

On October 14, 1997, the Insurer terminated the Applicant's medical benefits and loss of earning capacity benefits on the basis of her refusal to attend an IE. The purported IE request was based on a "Written Plan for Medical and Rehabilitation Assessment" prepared for the Insurer by Capital Vocational Specialists Inc. ("Capital") on January 20, 1997.²³ The Applicant's only objection to the request related to the Insurer's fourth referral question to Capital: "What work hardening or treatment modalities are required so that [the Applicant] can return to full time employment within the video store industry?" In its Written Plan, Capital reformulated the question because it "had concerns that the wording implied prognostication, which the OIC [FSCO] guidelines do not permit" and in order "to avoid any overlap with the mandates of other types of DAC's." As reformulated, the question read: "What type of treatment modalities would be beneficial in improving [the Applicant's] functional status over the next two years to maximize her chances or [sic] returning to employment within the video store industry on a full time basis?" Capital proposed to address the referral questions by doing a medical examination, occupational therapy review of the Applicant's job tasks and activities of daily living, and a functional capacity evaluation ("FCE").

The Applicant submitted that the Insurer is not entitled to require an IE except in response to an ongoing claim for benefits. Her main objection to the requested examination was that it represented an attempt by the Insurer to obtain a more favourable opinion than the one they had received from WorkWise.

The Insurer submitted that section 65 of the Schedule allows an insurer to require an IE, independent of any specific ongoing claim, with respect to an insured person's ongoing disability and compliance with section 13 (responsibility to seek employment), and in order to satisfy its obligation to assist in rehabilitation under section 40 of the Schedule. The Insurer relied on subsections 65(5) and 65(5.1) of the Schedule, which permit an insurer to withhold payment of benefits, including medical benefits and LECBs, until the insured person submits to the examination. The Insurer pointed out that subsection 65(1), on its face, allows an insurer to require an IE with respect to Part II of the Schedule, which includes section 13, and Part VIII, which includes section 40.

The main difficulty with this submission is that the Insurer requested a DAC assessment, not an IE. Capital's "Written Plan for a Medical and Rehabilitation Assessment" states that the Insurer referred the Applicant to it "in its capacity as a Designated Assessment Centre" "for the purpose of a Medical and Rehabilitation Assessment." Capital proposed to conduct the assessment itself. I received no evidence of any other Insurer request that the Applicant attend for examination during the period in issue.

The procedure for conducting a Medical and Rehabilitation DAC is set out in Part VII of the Schedule. The process begins with the insured person making a claim for a medical benefit under section 36. Section 37 allows an insurer to require the insured person to furnish a certificate from her health practitioner stating that "the expense" is reasonable and necessary for her treatment. On receipt of the certificate, the insurer may require the insured person to be assessed at a DAC. Subsection 39(12)(a) says that an insurer is not required to pay a claimed expense for the period that the insured person does not make herself reasonably available for the assessment. In this case, the Insurer conceded that the Applicant agreed to attend a Medical and Rehabilitation DAC with respect to her claims for medical benefits. The Insurer has, for reasons of its own, not arranged the DAC as required under section 39. Accordingly, I find that subsection 39(12)(a) does not apply and the Insurer was not entitled to withhold benefits for medical benefits.²⁴ The benefits, totalling $5,260.33, shall be paid in accordance with subsection 39.1.

The Insurer characterized its request as an attempt to assist in rehabilitation, as required under section 40. Reading Parts VII and VIII as a whole, and especially considering the references to "the expense" and "an expense" in subsections 37(1), 39(1) and 39(12), and in subsections 43(1) and 45(1), 45(12), I find that an insurer's requirement that the insured person be assessed at a DAC must be in response to a particular claim for an expense. Since the Applicant has not claimed medical and rehabilitation benefits for "treatment modalities [which] would . . . maximize her chances or [sic] returning to employment within the video store industry on a full time basis," I find that the Insurer is not entitled to require the Applicant to attend a Medical and Rehabilitation DAC with respect to these issues.

Subsection 23(2) requires a REC DAC assessment of an insured person who disputes the insurer's offer with respect to residual earning capacity. The process for arranging the DAC is set out under section 27. The Insurer did not claim that its referral to Capital was a referral under section 27. However, Capital justified its proposal for an FCE on the following basis:

The previous FCE administered by WorkWise was not considered by them to be an accurate reflection of Ms. Olszynko's full abilities. Additionally, little of the performance criteria was specified in the WorkWise report.

This is inaccurate. Despite concerns about self-limiting behaviours, the WorkWise assessors drew the following conclusion about the validity of the assessment:

Overall, the results of this assessment are felt to be valid, based on varied performance across the 2 weeks of the assessment.²⁵

Dr. Henderson confirmed and explained this conclusion at the hearing. I find that the WorkWise assessors clearly and adequately set out their reasons for drawing this conclusion.

I heard no particulars in support of Capital's statement that "little of the performance criteria was specified in the WorkWise report." I find that the sixteen-page report sets out the performance criteria adequately and in accordance with FSCO Guidelines.

An insurer who is dissatisfied with a REC DAC report has two possible remedies: it can challenge the report in a proceeding before a judge or an arbitrator, or it can await the three-year LECB review mandated by section 33 of the Schedule. In my view, the drafters of the Schedule did not intend that an insurer, unhappy about a REC DAC report, should be able to shortcut this process by requesting a DAC without following the DAC process set out in the Schedule. Moreover, nothing in the Schedule suggests that an insurer can use the provisions of subsections 65(5), 65(5.1) and 71.1 to circumvent the review process.

I find that the Insurer was not entitled to terminate the Applicant's LECBs on October 14, 1997. The Insurer is ordered to reinstate LECBs as of that date.

Special Award:

Subsection 282(10) of the Act requires an Arbitrator to give a special award where the Arbitrator finds that the Insurer "unreasonably withheld or delayed" benefits.

For the reasons given above, I find that the Insurer had no basis in the Schedule for terminating the Applicant's benefits in October 1997. No IE was requested. The Applicant agreed to attend a Medical and Rehabilitation DAC with respect to the medical benefits she had claimed. The Insurer was not entitled to require a REC DAC at that time under Part VI of the Schedule. I reject the Insurer's submission that "the insurer's offer to have one comprehensive DAC for the purposes of expenses and rehabilitation is evidence of their reasonableness" since the Schedule does not contemplate a "comprehensive DAC" or a Medical and Rehabilitation DAC in the absence of an ongoing claim for medical and rehabilitation benefits.

The drafters of the 1994 Schedule intended the procedural provisions of Part VI (loss of earning capacity benefits) and Part VII (medical benefits) to ensure that disputes about benefits do not unduly delay payment of benefits. In this case, the Insurer did not dispute the Applicant's entitlement to the benefits withheld. I find that the Insurer's failure to comply with the mandatory procedural provisions of the Schedule amounted to an unreasonable withholding of benefits and justifies a special award.

The Insurer's contravention is mitigated by the novelty of these provisions. Considering the amount of benefits withheld, I find an award of $5,000 to be appropriate in the circumstances. Interest is payable in accordance with subsection 282(10) of the Act.

Arbitration Expenses:

If the parties are unable to agree on expenses, the matter may be dealt with pursuant to Rules 73-77 of the Dispute Resolution Practice Code (April 15, 1997).

February 22, 1999

Nancy Makepeace Arbitrator

Date