Neutral Citation: 2000 ONFSCDRS 1
FSCO A98-000212
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
MARTHA AWAD
Applicant
and
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
Insurer
REASONS FOR DECISION
Before:
Shari Novick
Heard:
June 28, 29 and August 11, 1999, at the Offices of the Financial Services Commission of Ontario in Toronto.
Appearances:
David F. Longley for Ms. Awad
Casey Van Moorlehem for State Farm Mutual Automobile Insurance Company
Issues:
The Applicant, Martha Awad, alleges that she was injured in a motor vehicle accident on September 16, 1997. She applied for statutory accident benefits from State Farm Mutual Automobile Insurance Company ("State Farm"), payable under the Schedule.1 State Farm has not paid any benefits to date. The parties were unable to resolve their disputes through mediation, and Ms. Awad applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.
The issues in this hearing are:
Did Ms. Awad sustain an impairment as a result of an "accident"?
If so, is Ms. Awad entitled to expenses she incurred for physiotherapy treatments in accordance with section 14(2) of the Schedule?
Does section 48 of the Schedule apply to Ms. Awad?
Is Ms. Awad entitled to a special award pursuant to section 282(10) of the Insurance Act on the grounds that State Farm unreasonably withheld or delayed payments?
Is Ms. Awad liable to pay an amount to State Farm not exceeding its assessment fee on the basis that she has commenced an arbitration that is frivolous, vexatious or an abuse of process pursuant to section 282(11.2) of the Insurance Act?.
Is Ms. Awad entitled to her expenses of the arbitration?
Is State Farm entitled to its expenses of the arbitration?
Result:
Ms. Awad sustained an impairment as a result of an accident that occurred on September 16, 1997.
Ms. Awad is entitled to the expenses she incurred for physiotherapy treatments as a result of that accident.
In light of the above findings, section 48 of the Schedule does not apply.
Ms. Awad is not entitled to a special award.
State Farm is not entitled to the return of its assessment fee.
The matter of expenses can now be spoken to.
Ms. Awad's evidence was translated by a Spanish interpreter, Raul Galvez.
EVIDENCE AND ANALYSIS:
Introduction:
Martha Awad alleges that she injured her left knee when she was struck by a motor vehicle on September 16, 1997, as she walked along the sidewalk on the north side of Wilson Avenue, near its intersection with Jane Street. State Farm contends that there was no contact between Ms. Awad and the vehicle in question.
Ms. Awad received physiotherapy treatments for a few months after this incident, at a cost of $3,555. That is the amount in dispute in this application. Ms. Awad underwent an arthroscopy on her left knee in February of 1998 and subsequently received further physiotherapy. Her entitlement to any amounts owing for this further treatment are not part of this application.
The issue to be decided at this juncture is whether the physiotherapy expenses in issue were incurred as a result of an accident, and if so, whether the treatment received was "reasonable and necessary. "Given the parties' differing positions on whether there was any contact between Ms. Awad's left knee and the vehicle in question, I will outline the testimony of Ms. Awad and the driver and passengers in the car in some detail, as well as any other evidence that is either supportive of or inconsistent with their statements.
Applicant's evidence:
Ms. Awad is 43 years old. She has three daughters and currently works as a cook in a restaurant. She was working part-time as a busperson at the Humber Towers Restaurant at the time of the accident.
Ms. Awad appeared to recall the events of September 16, 1997 clearly. She testified that she had stopped to buy a few items at the Biway store near the intersection of Jane Street and Wilson Avenue on her way home from work, at approximately 3 p.m. She stated that after leaving the store she was walking along the sidewalk on the north side of Wilson Avenue towards the bus stop at the corner of Wilson and Jane Street. A small plaza with a gas station and a Coffee Time restaurant is situated immediately west of that intersection. Ms. Awad testified that she saw a white car stopped at the edge of the sidewalk as she approached the driveway from which cars enter and exit the plaza. She stated that as she walked across that driveway the car began to move forward slowly, and that its front bumper struck her left knee. She explained that she then turned to face the car head on and grabbed the hood of the vehicle, holding onto it and walking backwards for a few steps as the car continued to roll forward.
The Applicant testified that as soon as the car stopped moving she went over to the driver's side of the vehicle. She recalled feeling very shaken and angry, and stated that she had yelled at the young man driving the car, asking "what he was doing" a few times. She stated that the driver responded "sorry ma'am" and then drove out of the plaza onto Wilson Avenue, heading west. Ms. Awad wrote down the licence number of the car as it drove off, and then walked to the bus stop at the corner and took the bus home. She explained that she later called the police at her daughter's urging and gave a statement about the incident, describing it as a "hit and run."
Ms. Awad testified that she also went to see Dr. Leung, her family doctor, later that afternoon as she was experiencing pain in her left knee. Dr. Leung's notes indicate that Ms. Awad advised him that she had been hit by a moving car while walking on September 16, 1997. He testified that upon examination of her knee he had observed tenderness and swelling on the lateral aspect, as well as reduced range of movement. He ordered an x-ray of her left knee and prescribed Tylenol 2 for pain. Ms. Awad consulted Dr. Leung a few more times that week, complaining of pain in her right forearm, headaches, and neck pain as a result of the accident. He testified that he referred her to a physiotherapy clinic for treatments twice per week, in order to improve function in her knee and to help heal the injury.
Dr. Leung had been the Applicant's family doctor for approximately five years prior to the accident. He was asked whether she had sustained any previous injuries or had a pre-existing condition in her left knee, and responded that his clinical notes refer to Ms. Awad having complained of left knee pain in May of 1994 "for a couple of months." His notes indicate that he had prescribed medication at that time, and that she had continued to complain of knee pain three weeks later. Dr. Leung reported that an x-ray taken at that time did not indicate any abnormalities in Ms. Awad's knee. He stated that while he had tentatively diagnosed her as having osteoarthritis, he had not received any further complaints from the Applicant about her left knee in the three years between that time and the accident. Under cross-examination Dr. Leung conceded that it would have been possible for Ms. Awad's knee to have been swollen on September 16, 1997 due to osteoarthritis, but that in his opinion, it was more likely that she had been hit by a car.
The Applicant testified at the hearing that she had been working at the time of the accident as a busperson at the Humber Towers Restaurant for four hours each day, five days per week and had been doing so since June of 1997. However, she had advised State Farm and the doctors and physiotherapists that she consulted in the aftermath of the accident that she was not working outside of the home. She also did not report any income from employment on her 1997 tax return. Ms. Awad advised the examiners from Assessmed who conducted an Insurer's Examination in December of 1997 that she was a caregiver. In January of 1998 she reported to the assessors at the med/rehab DAC conducted that she was not working, but was training to be a busperson in a restaurant. It was also clear that Dr. Leung was not aware that she was working when she consulted him about her knee problems after the accident.
Ms. Awad explained that she had not divulged the fact that she was working to any of these people because her job at the restaurant was not secure at that point in time. She stated that she did not have a written contract of employment or any papers confirming her status as an employee, and that she could have been told at any time not to come into work the following day. She stated that she was paid in cash each week, and that she did not think that it was necessary to have any records of these payments because she only earned a small amount. I note that Ms. Awad was apparently provided with a written contract after June 1, 1998 and that records of her earnings from the restaurant after that date were produced. I find her explanation for concealing the fact that she had been working for three months prior to the accident to be unconvincing. The evidence indicated that Ms. Awad was receiving family benefits during this period, and the more likely explanation is that she did not want to sacrifice the amount of benefits she was receiving by reporting any income from employment.
While this omission may impact upon Ms. Awad's credibility, it does not appear to have any bearing on the treatment she received. Dr. Leung testified that the physiotherapy treatment he recommended for Ms. Awad was medically reasonable and necessary at the time, and that he would not have changed his prescription for such treatment if he had known that she had been working.
Insurer's evidence:
Tony Savelli was 17 years old at the time of the alleged incident. He explained that he was driving a car owned by his father on the afternoon in question, and that he had arranged to meet his friend Mike Angelucci at the Coffee Time restaurant in the plaza at the corner of Wilson Avenue and Jane Street after school. He testified that Mike arrived at approximately 3:15 p.m. with another friend, Elio D'Alessio, and that after they all got into the car he proceeded to drive towards the exit of the plaza.
Mr. Savelli recalled that he had stopped the car approximately one metre before the sidewalk that runs adjacent to the plaza, at which point he noticed Ms. Awad walking on the sidewalk. He testified that as she walked by, she grabbed onto the hood of the car and started banging on it with both hands. He explained that she then came over to his window and started yelling at him, accusing him of almost hitting her. He recalled apologizing to her, and then driving out of the plaza onto Wilson Avenue as another car was waiting to enter the plaza via the same driveway. He added that he had watched Ms. Awad as she continued to walk towards Jane Avenue, and that she had done so in a normal manner, without a limp.
When asked if it was possible that the car had rolled forward slightly as Ms. Awad walked across the portion of the sidewalk that is adjacent to the driveway of the plaza, Mr. Savelli testified that while he may have released the brake slightly for a moment, he was certain that the car had not moved. His evidence on this point differs both from the statement he provided to State Farm on November 13, 1997 and from a statement he subsequently gave to the police on January 12, 1998. In both of these statements Mr. Savelli allowed that the car may have rolled forward slightly as he let up on the brake pedal in response to honking from the car that was waiting to turn into the driveway of the plaza, but that he had applied the brake to stop the car as soon as he saw the Applicant approaching from the right side. When asked by the police officer where Ms. Awad was located when he had first noticed her, Mr. Savelli responded that she was near the right front corner of the car, adding that "if she scratched herself on the licence plate or something, I don't know about that."
When confronted with these prior statements at the hearing, Mr. Savelli only stated that the police officer who took his statement had not recorded everything that he had told him, and that the statement was not read back to him.
Mike Angelucci and Elio D'Alessio also testified at the hearing. They each stated that the car had not moved forward as Ms. Awad crossed the driveway to the plaza, and that it did not come into contact with her knee. Mr. Angelucci testified that Ms. Awad had not stated at any point during her brief discussion with Mr. Savelli that she had been hit or was injured, and added that they had all decided after the incident occurred that she must be "disturbed."
In a statement provided to State Farm on November 13, 1997 Mr. Angelucci stated that after the car initially came to a stop at the exit of the plaza, it rolled forward slightly before coming to another stop as Ms. Awad approached from the right side.
As a result of the police investigation, Tony Savelli was charged with three violations of the Highway Traffic Act. He pled not guilty and the charges were dropped when Ms. Awad failed to appear at the scheduled trial. Ms. Awad explained at the hearing that she had advised the agent that she had initially retained that she had received a summons to appear in court, and that he had told her that it was not necessary for her to appear.
Credibility findings:
As the parties have put forward two different versions of the incident in question, I must assess the witnesses' credibility and determine whether or not there was any contact between the vehicle in question and Ms. Awad's knee. Having carefully reviewed the evidence, I prefer Ms. Awad's version of events and find that the car driven by Mr. Savelli did come into contact with her left knee as it rolled forward onto the sidewalk that she was walking across. My findings are based on an assessment of the circumstances surrounding the incident, as well as on Ms. Awad's subsequent actions and the evidence provided by Dr. Leung.
The evidence indicates that there was only one driveway from which cars entered and exited the plaza in question, and that it was only wide enough for one car to pass through at a time. It was common ground that another car was stopped on Wilson Avenue, waiting to turn into the plaza at the time of this incident and that the driver of that car was honking. The evidence also indicated that another car was stopped behind Mr. Savelli's vehicle, also waiting to exit the plaza. In the statements provided by Mr. Savelli to the Insurer and to the police it is clear that this situation created some anxiety on Mr. Savelli's part. It is reasonable to assume that this caused him to become flustered and that he proceeded to exit the plaza without adequately ensuring that no one was in the vehicle's path. I accept the evidence provided in his earlier statements to the effect that the car rolled forward slightly after he had initially come to a stop in front of the sidewalk over the evidence he gave at the hearing that the car did not move at all, given that the statements were given much closer in time to the incident than the arbitration hearing, which was held almost two years after the fact.
There are a few other points in Mr. Savelli's testimony that lead me to conclude that his vehicle came into contact with the Applicant's knee. He testified that he had apologized to Ms. Awad when she came around to his side of the vehicle and began yelling at him. This conduct only makes sense if he had actually hit her: there would be no reason to apologize if, as he alleged, she was walking by and began to bang on the hood of his car for no reason. I also note his comment in the statement given to the police to the effect that the Applicant might have "scratched herself on the licence plate or something." This not only suggests that Ms. Awad's leg was close enough to his vehicle to have had some contact with it, but contradicts his evidence at the hearing that she began banging on the hood of the car as she passed by for no apparent reason.
Ms. Awad's conduct, both during and after the incident, is also consistent with a finding that Mr. Savelli''s vehicle came into contact with her knee. The occupants of the car testified that she began banging on the hood of the vehicle with her hands as she passed in front of it. Ms. Awad stated that she grabbed onto the front of the car and held onto it as she took a few steps backwards until the car stopped rolling. Either of these responses strike me as being appropriately instinctive or defensive responses to coming into contact with a car that is rolling forward onto a sidewalk as one is walking across it. The fact that Ms. Awad recorded the vehicle's licence number as it drove off is also consistent with the view that the car made contact with her knee.
Ms. Awad's actions in the aftermath of the incident are perhaps the most persuasive evidence of contact having been made between the vehicle and her knee. Her uncontradicted evidence is that she both called the police to report the incident and went to see Dr. Leung about her injured knee within a short time after returning home that afternoon. Despite the fact that she has misrepresented certain matters throughout the course of this process, I do not accept that Ms. Awad would have concocted this story and filed a false police report in order to have physiotherapy treatment funded.
In any event, Dr. Leung's notes indicate that the Applicant's left knee was swollen and tender when she saw him later that afternoon, and that he diagnosed her as having sustained a contusion and strain to that knee. While he allowed under cross-examination that it was possible that her knee was tender due to a pre-existing condition, Dr. Leung opined that it was more likely that she had been hit by a slow moving vehicle. While the impact between the vehicle and Ms. Awad's knee was clearly a minor one, I accept Dr. Leung's evidence and note that Ms. Awad had not complained of any knee problems for over three years prior to the accident.
The Insurer contended that I should reject Ms. Awad's evidence regarding what transpired on September 16, 1997 because she had a history of lying for the purpose of financial gain. Ms. Awad has clearly lied to various medical professionals and authorities about both her employment status and the amount of her earnings in 1997 and the first half of 1998. I have already stated that I do not accept the explanations she has proffered for this. She also testified at the hearing that she had never taken any medication for her knees prior to the accident, which I do not accept, in light of the indication in Dr. Leung's notes that he had prescribed medication in response to her complaints of knee pain in May of 1994.
In my view, however, these misrepresentations do not impact upon her credibility on the issue of whether there was contact between the vehicle in question and her knee. If this application addressed her entitlement to income replacement benefits or caregiver benefits, these misrepresentations would be detrimental to her claim. I have already set out my reasons for accepting Ms. Awad's contention that she was struck by the vehicle driven by Mr. Savelli. The only issue in this case is her entitlement to physiotherapy expenses for treatment she received as a result of that accident. In light of Dr. Leung's statement that he would have prescribed the same treatment if he had known that she was working for four hours each day during the relevant time, I find that her misrepresentations in that regard are not relevant to the issue before me.
Were the expenses incurred reasonable and necessary?
Section 14 of the Schedule provides that an insurer shall pay a medical benefit for all reasonable and necessary expenses incurred by an insured person for physiotherapy treatment required as a result of an accident. Dr. Leung's evidence that the expenses in question were medically reasonable and necessary at the time was uncontradicted. I note that Ms. Awad also underwent a medical/rehabilitative DAC assessment on January 27, 1998. The DAC report recommended that she continue with regular physiotherapy treatments for her left knee up to the date of the arthroscopy, which was scheduled to take place two weeks later.
In light of this evidence, I conclude that the physiotherapy expenses claimed are reasonable and necessary and that State Farm is therefore liable to pay the amount in issue.
Section 48 argument:
The Insurer relied on section 48 of the Schedule, which provides that an insurer may terminate the payment of benefits to an insured person who wilfully misrepresents material facts "with respect to an application for a benefit." Given my findings that Ms. Awad was involved in an accident, and that her misrepresentations regarding her employment status are not relevant to her claim for physiotherapy expenses, this argument must fail.
Special Award:
The Applicant claims that if I find that she was involved in an accident as alleged, she is entitled to a special award. Counsel submitted that if the Insurer chose to take a hard line and force Ms. Awad to proceed to arbitration to prove that she sustained an impairment as a result of an accident, it should be required to pay a special award if its position is not ultimately accepted. Section 282(10) of the Insurance Act provides me with the jurisdiction to award a lump sum to the Applicant if I find that the Insurer has unreasonably withheld or delayed payments. While I have accepted Ms. Awad's allegations and have determined that she sustained an impairment as a result of the accident, I do not find that the Insurer acted unreasonably in withholding payment of these expenses, in light of the statements it obtained from its insured and the two other occupants of the vehicle to the effect that there was no contact between the vehicle and Ms. Awad. This provision is meant to penalize insurers who take unreasonable positions in the adjusting of first party claims, and does not mandate that an award be made in each case in which the insurer's position is not accepted at arbitration.
Accordingly, I decline to make a special award in this case.
Return of assessment fee - section 282(11.2) of the Act:
Given my findings that Ms. Awad is entitled to the benefits claimed, I decline to award an assessment against her under the above provision.
EXPENSES:
I received no submissions on expenses from the parties at the hearing. I encourage the parties to resolve this issue among themselves, failing which I can be spoken to about this matter.
January 4, 2000
Shari L. Novick Arbitrator
Date
Neutral Citation: 2000 ONFSCDRS 1
FSCO A98-000212
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
MARTHA AWAD
Applicant
and
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
Insurer
ARBITRATION ORDER
Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
Ms. Awad sustained an impairment as a result of an accident on September 16, 1997.
State Farm is liable to pay the amount of $3,555, plus interest, for physiotherapy treatments received by Ms. Awad as a result of the accident.
Ms. Awad's claim for a special award is dismissed.
State Farm's claim for the return of its assessment fee is dismissed.
January 4, 2000
Shari L. Novick Arbitrator
Date
Footnotes
- The Statutory Accident Benefits Schedule —Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended by Ontario Regulations 462/96, 505/96, 551/96 and 303/98.