Neutral Citation: 2000 ONFSCDRS 72

FSCO A97-002029

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

NIZAM KABBOUL

Applicant

and

LIBERTY MUTUAL INSURANCE COMPANY

Insurer

REASONS FOR DECISION

Before:

Joyce Miller

Heard:

November 1, 2, and 3, 1999, at the Offices of the Financial Services Commission of Ontario in Toronto.

Written submissions received by December 17, 1999.

Appearances:

Daniel J. Balena for Mr. Kabboul

J. Lynne Frank for Liberty Mutual Insurance Company

Issues:

The Applicant, Nizam Kabboul, was injured in a motor vehicle accident on September 12, 1994. He applied for and received statutory accident benefits from Liberty Mutual Insurance Company ("Liberty Mutual"), payable under the Schedule.¹ Liberty Mutual terminated weekly income replacement benefits on August 27, 1996. The benefits were reinstated after Mr. Kabboul requested an assessment by a Designated Assessment Centre ("DAC") pursuant to section 64 of the Schedule. After the DAC report was issued, Liberty Mutual terminated Mr. Kabboul's income replacement benefits on October 7, 1996. The parties were unable to resolve their disputes through mediation, and Mr. Kabboul 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:

1. Is Mr. Kabboul entitled to receive a weekly income replacement benefit from October 8, 1996 and ongoing pursuant to section 7 of the Schedule?

2. Is Mr. Kabboul entitled to an offer for weekly loss of earning capacity benefits ("LEC") pursuant to section 21 of the Schedule?

3. What is the correct amount of Mr. Kabboul's weekly income replacement benefit?

4. Is Liberty Mutual entitled to a repayment with respect to any overpayment made on the amount of Mr. Kabboul's income replacement benefit pursuant to section 70 of the Schedule?

5. Is Mr. Kabboul entitled to $13,964.60 for supplementary medical and rehabilitation expenses claimed pursuant to subsections 36(1) and 40(5) of the Schedule?

6. Is Liberty Mutual liable to pay Mr. Kabboul's expenses in respect of the arbitration pursuant to subsection 282(11) of the Insurance Act?

7. Is Mr. Kabboul liable to pay Liberty Mutual's expenses in respect of the arbitration pursuant to subsection 282(11) of the Insurance Act?

Mr. Kabboul and Liberty Mutual both claim interest on outstanding amounts owing.

Result:

1. Mr. Kabboul is entitled to a weekly income replacement benefit from October 8, 1996 and ongoing pursuant to section 7 of the Schedule?

2. Mr. Kabboul is entitled to an LEC offer pursuant to section 21 of the Schedule.

3. The amount of Mr. Kabboul's income replacement benefit is $185.

4. Liberty Mutual is entitled to a repayment of $9,387 plus interest pursuant to sections 70 and 68 of the Schedule.

5. Liberty Mutual is entitled to set-off the repayment owed by Mr. Kabboul against the monies owed by Liberty Mutual to Mr. Kabboul.

6. Mr. Kabboul is not entitled to his supplementary medical and rehabilitation expenses of $13,964.60.

7. Mr. Kabboul is entitled to his interest on outstanding amounts that are owed pursuant to section 68 of the Schedule?

8. If needed, I may now be spoken to on the issue of expenses.

Background:

Mr. Kabboul is 46 years old. He is married and has three sons. He emigrated from Lebanon in 1976. He immediately began to work as a limousine driver and continued to work as a limousine driver until the accident. He has owned his own company, AERO Travel Services Limited, since 1992. The company exclusively serviced the airport.

The Accident

The accident occurred on September 12, 1994. Mr. Kabboul had just dropped a fare off and was heading back to the airport. He was stopped at a red light at Richmond and Spadina Streets. There was a curve in the road, and another vehicle coming at a very fast rate did not see the stopped traffic and rear ended Mr. Kabboul's car, pushing it slightly to the side.

Mr. Kabboul testified that in the first minute of the accident he couldn't remember what happened. When he stepped out of the car he immediately felt very dizzy and had to lean over the car. He exchanged the necessary information with the other driver and then got back into his car and headed toward the airport. While driving on the Gardiner, he developed a headache and he realized that both his shoulders were swelling up. He called his wife and his brother and then he went to see his doctor. His doctor was not there and he was seen by a Dr. Press about an hour after the accident. His brother drove his car to the body shop.

Dr. Press prescribed some Tylenol and advised Mr. Kabboul to go to the hospital. The next day, after having a very difficult night sleeping, Mr. Kabboul went to the emergency department at the Ajax Hospital. He was prescribed medication, Norflex and Voltaren.

On September 14, 1994, Mr. Kabboul saw his family doctor, Dr. R. Shariff. Dr. Shariff referred Mr. Kabboul to the Sports Medicine and Rehabilitation Clinic for physiotherapy treatment, which he began on September 27, 1994.

Mr. Kabboul testified that as a result of the injuries from the car accident, he has been unable to return to his job as a limousine driver.

Essential Tasks

On May 12, 1995, Rehabilitative Ergonomics performed a worksite analysis for Liberty Mutual. This report outlines in detail Mr. Kabboul's essential tasks of employment and is consistent with Mr. Kabboul's testimony regarding his job tasks.

Mr. Kabboul's duties as a limousine driver required him to pick up passengers and drive them to their destination. He had to assist the passengers with their luggage, the weight of which varied from a businessman's briefcase of 20 lbs up to 70 lbs for people travelling to and from abroad. He had the right, however, to refuse luggage and boxes over 70 lbs. Mr. Kabboul also had to assist elderly people in and out of the limousine and sometimes had to carry their luggage into their apartment bedroom. As well, he had to assist disabled people in wheelchairs. This required him to lift the person into the limousine as well as fold up and place his/her wheelchair into the trunk of the car. His other duties included collecting fares, recording transactions and maintaining contact with the dispatcher.

Mr. Kabboul worked approximately ten to fifteen hours a day, seven days a week.

The physical demands of his job required prolonged sitting and operating a motor vehicle for a lengthy period of time. Mr. Kabboul testified that he drove approximately 500 kilometres a day and that sometimes his fares would require him to go to Ottawa, Windsor or Buffalo.

Along with prolonged sitting, his physical demands included lifting, carrying, pushing and pulling, reaching, handling, fingering and visual acuity. He required eye/hand/foot coordination and being able to operate his car on a continual basis in accordance with the visual stimuli.

Medical Evidence

According to Mr. Kabboul's testimony and the medical evidence, Mr. Kabboul's injuries immediately after the car accident included headaches, dizziness, and an inability to sleep because of pain to his neck and lower back. As well, because he could not work, he lost his business. This resulted in a financial crisis for him, and caused family and marital strain. As a result of his pain, financial and marital problems, Mr. Kabboul became depressed.

Two weeks after the accident, Mr. Kabboul began physiotherapy and other treatments, including chiropractic adjustments, acupuncture, massage and electrotherapy. Between September 28, 1994 and July 27, 1998, Mr. Kabboul underwent approximately 300 treatments at the Sports Medicine and Rehabilitation Clinic. Mr. Kabboul was also assessed by Dr. Z.M. Marciniak, the Director of the clinic 50 times, from September 29, 1994 up to October 28, 1999.

For the first three months after the accident, Mr. Kabboul saw his family doctor, Dr. Shariff, on a weekly basis. In a report dated December 21, 1994, Dr. Shariff stated that as a result of the car accident, Mr. Kabboul had sustained a significant soft tissue injury and strain. He stated that Mr. Kabboul "... continues to have significant musculoskeletal symptoms to the para-axial musculature and to the musculature of the upper and lower extremities. He has severe ongoing headaches and is unable to move his neck through a full range of movement." Dr. Shariff went on to state that Mr. Kabboul also had difficulty sleeping and was under a tremendous amount of family and financial constraints and stress.

In a report dated February 24, 1995, Dr. Marciniak stated "at present [Mr. Kabboul] is still totally disabled from his pre-accident occupation and he requires treatment — physio, rehab exercise and chiropractic treatments."

In April 1995, Mr. Kabboul began to see a psychiatrist, Dr. A. Thangaroopan. In a report of October 25, 1999, Dr. Thangaroopan stated that Mr. Kabboul had been referred to him by Dr. Ronald H. Wilson, a neurologist, for post-traumatic neuroses. He diagnosed Mr. Kabboul with having a major depression, chronic pain syndrome, as well as psycho social stresses, including marital problems, and emotional pain due to loss of job, and loss of esteem and feelings of shame following the loss of stature as the breadwinner of the family.

Dr. Thangaroopan stated that in his view, Mr. Kabboul's depression could possibly be secondary to the disabilities/pain and emotional pain from his accident. He reached this conclusion in part because Mr. Kabboul had no previous history of any psychiatric illness and he had no contact with mental health services prior to the accident.

In May 1995, Mr. Kabboul went to Buffalo for an MRI test. In a report from Dr. David L. Berens to Dr. Marciniak, it was noted that there were findings of degenerative disc disease at levels L4-5 and L5-S1. Mild spondylosis was noted at L5-S1 level and interior encroachment upon the thecal sac at L4-5 and L5-1. The MRI revealed that there was a very mild degree of bulging of the anulus fibrosis at the L4-5 level. Regarding Mr. Kabboul's cervical spine, the findings were suggestive of early degenerative disc disease at the level of C5-6.

On June 19, 1995, Dr. Marciniak wrote to Mr. Kabboul's counsel and informed him that after seeing the MRI results, he had explained to Mr. Kabboul that Mr. Kabboul can expect long term problems with recurrent back pain." He further stated that he recommended continued physio and rehab exercise, massage and chiropractic treatment. As well, he recommended that Mr. Kabboul get psychological counselling and behaviour modification to help him deal with the stress.

On September 27, 1995, Mr. Kabboul underwent a CT scan. Dr. Ronald H. Wilson summarized his findings in a letter to Dr. Shariff, dated October 26, 1995. He noted that the CT scan of the lumbar spine showed a bulging disc at L5-S1 that was a mild cause of mechanical pain in that area. He noted that there was also a similar feature at L4-L5. The CT scan of the cervical spine showed mild disc bulging at C4-C5 with slight anterior indentation, but these changes are mild and there is no significant neural foraminal narrowing.

Dr. Wilson went on to state that the spinal pain Mr. Kabboul was experiencing was out of proportion to the minor mechanical changes seen on the CT scan. It was his opinion that the spinal pain was based on paravertebral muscular spasm and was related to chronic stress and possibly a post-traumatic neurosis.

In November 1995, Mr. Kabboul underwent a medical-rehab DAC assessment. In his report of November 22, 1995, Dr. Thomas Dorman, a chiropractor, made the following observation:

Clearly, Mr. Kabboul is still affected by the injury sustained in the ... MVA ... From a physical standpoint, Mr. Kabboul seems to be suffering from an extensive generalized myofascial pain syndrome which resembles fibromyalgia. He also seems to have cervical and lumbosacral joint disfunction. While he may have some nerve irritation as a result of this joint disfunction, there is no apparent nerve compression.

Dr. Dorman went on to say that by this date "tissue repair has probably become as complete as it ever will." Dr. Dorman recommended that Mr. Kabboul undergo a gradual withdrawal from the passive modalities of chiropractic adjustments, acupuncture, massage and institution-based electrotherapy. He stated that this withdrawal should be done gradually over a period of one month. Dr. Dorman went on to recommend that Mr. Kabboul engage in a home exercise program and use a home TENS unit for pain relief. As well, he recommended that Mr. Kabboul be referred to a rheumatologist to rule out any systemic reason for his slow recovery.

Dr. M. Martin, an orthopaedic surgeon, also examined Mr. Kabboul for the med-rehab DAC. In his report, he stated that there was no sign of any significant spinal injury. In his view, Mr. Kabboul's symptoms have been "refractory" to a protracted course of physiotherapy, chiropractic and acupuncture treatment. In his view, the structural injuries to Mr. Kabboul's spine were minimal. In his opinion, Mr. Kabboul had developed a pain dysfunction syndrome" and was suffering from this rather than any specific muscular skeletal impairment.

Dr. Martin stated that he did not believe Mr. Kabboul would gain any substantial improvement from continuing his current therapy. It was his view that Mr. Kabboul would be better served by undergoing psychological and pain management counselling.

On January 19, 1996, as a result of the DAC, Liberty Mutual advised Mr. Kabboul that they would no longer be funding any further passive treatment.

In February 1996, Liberty Mutual sent Mr. Kabboul for a vocational assessment. Mr. Kabboul was assessed by a rehabilitation consultant vocational specialist at Sibley and Associates. In a report of February 9, 1996 to Liberty Mutual, it was noted that according to the November 1995 DAC assessment, Mr. Kabboul was unable to meet the physical demands of the position of limousine driver. The consultant recommended that Mr. Kabboul participate in sedentary occupations or possibly light duty occupations, such as a telephone solicitor or the job of a supervisor. The report noted, however, that Mr. Kabboul was a very proud man who would most likely not attempt to work as a telephone solicitor.

In May 1996, Dr. Marciniak referred Mr. Kabboul for an assessment by Dr. I. Bernard Schacter, a neurosurgeon. In a report dated June 24, 1996, Dr. Schacter stated that he did not believe Mr. Kabboul was capable of working. It was his view that Mr. Kabboul required treatment for his depression/anxiety. He stated that unless there was an improvement in Mr. Kabboul's non-physical situation, there would not be any significant improvement in his physical condition despite various treatment programs. He recommended that in addition to treatment for Mr. Kabboul's non-physical problems, a work-hardening program should be considered that might allow Mr. Kabboul to get back into the workforce at some future date. He noted that based on his symptoms, at that time, Mr. Kabboul could not sit in a car and drive for long periods of time.

Also in May 1996, Liberty Mutual sent Mr. Kabboul to be assessed by the Canadian Back Institute ("CBI"). In the CBI's report of May 28, 1996, it was noted that Mr. Kabboul did not perform six out of the nine tests on the first day of testing and did not attend the second day of testing. Nevertheless, the report concluded that there was no objective evidence of any physical reason that Mr. Kabboul could not begin returning to work. The report further recommended that Mr. Kabboul discontinue any form of passive medical or rehabilitative intervention due to the lack of success in the past.

In June 1996, Liberty Mutual sent Mr. Kabboul for an insurer's medical examination ("IME") with Dr. E.T. Urovitz, an orthopaedic surgeon. In his report of June 13, 1996, Dr. Urovitz stated that "although I have not received a complete resume of all of these tests, my overall impression is that there would be nothing outstanding on any of these tests that would substantiate again a serious structural or biomechanical abnormality to account for his continuing and apparently chronically worsening systems."

Dr. Urovitz concluded:

The results of my physical examination did demonstrate numerous inconsistencies and non-organic signs which can be seen in either chronic pain syndromes, or in the alternative, wherein there is a major element of voluntary simulation of symptoms for the purposes of secondary gain.

Dr. Urovitz then went on to state that he did not find that Mr. Kabboul was disabled from his pre-accident occupation or any alternative occupation.

In July 1996, Mr. Kabboul underwent a neurological medical/legal examination with Dr. D. T. Crisp. In his report of July 3, 1996, Dr. Crisp stated that Mr. Kabboul had developed a chronic pain syndrome and a severe reactive depression as a result of the accident. He noted that Mr. Kabboul's chronic migraine headaches were cervicogenic in origin. It was his view that Mr. Kabboul was not employable and that the prognosis for future employment was dependent upon whether Mr. Kabboul's depression would resolve or become a chronic problem.

On August 7, 1996, Dr. Shariff sent a report to Mr. Kabboul's counsel. In his report, he stated that Mr. Kabboul did not require any specific treatment at that time except for analgesia, as needed. He went on to say that Mr. Kabboul's symptoms are subjective and that he continued to have moderate symptoms of musculoskeletal origin with some functional overlay. Dr. Shariff stated that he had discussed at length with Mr. Kabboul attempts for rehabilitation and a return to work where there was no involvement with lifting or bending.

On August 27, 1996, Liberty Mutual terminated Mr. Kabboul's benefits based on the IME by Dr. Urovitz.

Mr. Kabboul requested a DAC which was performed in October 1996. Mr. Kabboul was examined by a physiatrist, Dr. B.K. Kim, a psychiatrist, Dr. S.L. Debow and a neurologist, Dr. D.F. Waller. As well, Mr. Kabboul underwent a Functional Capacity Assessment.

The conclusion of the DAC was that there was no objective evidence of musculoskeletal skeletal injuries as a result of the motor vehicle accident, nor was there any neurological impairment to substantiate his complaints. The report stated that Mr. Kabboul was suffering from secondary affective long-term chronic pain behaviour with symptom magnification as a major presentation. It was noted that Mr. Kabboul's symptoms were in keeping with a minor depressive disorder, and that it was the continuing marital discord that seemed to be preventing him from returning to his previous occupation.

The neurologist, Dr. Waller, stated that further physiotherapy was very unlikely to make any difference. If any further treatment was needed, it should be highly concentrated in the psychiatric aspect. Dr. Waller stated that Mr. Kabboul has a perceived disability, and if the psychiatric dimension is not resolved, then his perceived disability is likely to continue. Dr. Waller noted that Mr. Kabboul's caregivers have given Mr. Kabboul the impression that he could never again be a limousine driver.

Dr. Kim's assessment was that Mr. Kabboul's neck and back pain was a grade one whiplash lesion with no objective evidence of bony or neurological injuries; his headaches are related to family and financial stresses and to the side effects of medication, and his diffuse muscular pain syndrome was due to disuse and lack of conditioning.

The conclusion of the Functional Capacity Assessment was that Mr. Kabboul was clearly below the functional abilities needed to return to his pre-accident occupation. However, it stated that since there was no significant organic pathology revealed in the orthopaedic report, and the accident had occurred over two years ago, it was felt that Mr. Kabboul was no longer substantially disabled from performing his pre-accident essential tasks.

The conclusion of the DAC assessment was that Mr. Kabboul was not physically or psychologically disabled from performing the essential tasks of his pre-accident occupation as a result of the accident.

Liberty Mutual did not send Mr. Kabboul on any further medical examinations after the Disability DAC. However, Liberty Mutual presented two medical reports into evidence that were prepared for the third party in a tort claim. The first report is from Dr. Fred Langer, an orthopaedic surgeon, dated January 21, 1997.

In the history part of the report, Dr. Langer noted that Mr. Kabboul was married, and misstated the fact that Mr. Kabboul had two daughters. In his conclusion, Dr. Langer stated that "... Mr. Kabboul's symptoms cannot be considered anything other than manifestations of chronic exaggerated illness behaviour."

He went on to state that there was probably an "iatrogenic" element to Mr. Kabboul's complaint. For example, he noted that Dr. Marciniak had suggested to Mr. Kabboul that based on the MRI, Mr. Kabboul had suffered a fracture of the spine. In Dr. Langer's opinion, the MRI did not reveal any evidence of a fracture. Dr. Langer concluded that Mr. Kabboul could be working at his regular job, and that he did not require any further investigation or treatment. It was his opinion that Mr. Kabboul was physically fit and did not have any physical impairment.

The second report was prepared by Dr. Henry Berry, a psychiatrist. In his report of January 21, 1999, Dr. Berry stated that Mr. Kabboul's diagnosis "can be termed a type of excessive illness behaviour with a functional (non organic or conversion type) motor weakness and sensory change, psychogenic pain with features of a litigation or compensation reaction with severe marital and domestic stresses."

In January 1998, Mr. Kabboul was examined by Dr. B.J. Woolford, an orthopaedic surgeon, for a medical/legal assessment. Dr. Woolford, in his report of January 19, 1998, stated that he had reviewed Mr. Kabboul's medical history and the treatment he received after the accident, and concluded that his present problems were as a result of the accident. He noted that the spondylolysis was probably present before the accident.² However, he stated Mr. Kabboul had no back problems before the accident and was able to cope with the full duties of a limousine driver. It was his opinion that Mr. Kabboul "in all probability" would be permanently disabled as a result of the injuries he received from the accident. In his opinion, the only treatment that could be offered to Mr. Kabboul was simple analgesics, muscle relaxant or anti-inflammatory pills. He stated that if the pain would get "particularly severe," he may need narcotic medications.

In February 1998, Mr. Kabboul was seen by Jacqueline Stewart, a rheumatologist. In her report of February 6, 1998, Dr. Stewart stated that Mr. Kabboul's symptoms of headaches, fatigue, memory loss and sleep disturbance were all typical in patients who developed fibromyalgia. She noted that "the fact that all of these symptoms developed subsequent to the injury and that he had never had them previously suggest that this was in fact triggered by the soft tissue injury sustained in the motor vehicle accident." Dr. Stewart went on to state:

I find this patient [continues] to suffer from quite severe pain. In addition to the pain, he has difficulty performing many daily activities. He suffers from headaches, fatigue, trouble with memory and concentration and quite marked depression. My impression is that this patient is totally disabled from any form of employment at this time.

In a follow-up report of October 26, 1999, Dr. Stewart stated that, in her view, Mr. Kabboul is genuinely disabled as a result of chronic pain which had evolved due to his injuries in the motor vehicle accident. She stated that Mr. Kabboul sustained a soft tissue injury initially, and then went on to develop more diffuse and chronic musculoskeletal skeletal symptoms that have now gone on to develop into fibromyalgia. She stated that patients who have fibromyalgia go on to suffer from problems with chronic pain and are very disabled due to the pain. She noted that patients who suffer from fibromyalgia have difficulty performing functional evaluations because they are in pain, and not because they have some sort of physical abnormality that would prevent them from doing so.

Dr. Stewart stated that Mr. Kabboul has lost a considerable amount in his life because of the accident — he is not able to work; his relationship with his family has broken down, and he is under psychiatric treatment. In her view, Mr. Kabboul has become very emotionally distressed as a reaction to being injured in the accident and that she would not describe his symptoms as a secondary gain behaviour.

ANALYSIS AND FINDINGS:

Before discussing the substantive issue of Mr. Kabboul's disability claim, I will first deal with the issue of credibility raised by Liberty Mutual.

1. Credibility

Liberty Mutual submits that Mr. Kabboul's claim for ongoing Income Replacement Benefits ( IRBs") is not credible. Liberty Mutual argues that Mr. Kabboul is attempting to portray himself as being disabled when there is no objective evidence of any impairment, nor is there evidence to support or explain the degree of pain that Mr. Kabboul complains of.

Liberty Mutual pointed out, for example, that at the hearing Mr. Kabboul's demeanour in examination-in-chief was quite different than in cross examination. Liberty Mutual stated that Mr. Kabboul exhibited pain behaviour during the examination-in-chief which, in its view, was "obviously staged." Liberty Mutual submitted that under cross examination, Mr. Kabboul was able to sit for one hour without moving and did not exhibit any pain behaviour.

As well, Liberty Mutual submitted that its medical evidence showed that Mr. Kabboul had demonstrated definite tendencies toward symptom magnification," pain amplification behaviour," inconsistencies in testing and exaggeration of his symptoms.

I am not persuaded by Liberty Mutual's submission that Mr. Kabboul lacked credibility with respect to his disability. As I stated in Miller and Pafco Insurance Company Limited, ³in order for an applicant not to be found credible, the lack of credibility must be substantial and significant with respect to the material elements of the applicant's claim.

In presenting his evidence, I found that Mr. Kabboul was generally credible, detailed and consistent in his testimony. While I observed that there was a marked difference in Mr. Kabboul's physical demeanour when presenting his examination-in-chief as compared to cross examination, I nevertheless do not attribute this to staged" behaviour.

My observations of Mr. Kabboul were that he was in genuine distress when he began his examination-in-chief. However, I attribute this to the fact that Mr. Balena had instructed Mr. Kabboul not to take any of his medication for the start of the hearing. I accept Mr. Kabboul's submission that the reason he was calmer during the cross examination is because he had begun taking his medication.

In reviewing the medical evidence, I found that Mr. Kabboul was consistent in describing what happened to him and his life after the car accident, and I give little weight to the opinion that Mr. Kabboul was malingering for secondary gain. I will comment on this finding in my reasons below.

I did not receive any surveillance that would discredit Mr. Kabboul's credibility. Nor did I receive any evidence which would show that Mr. Kabboul suffered from any disabling medical condition before the accident that he was wrongfully attributing to the accident.

Accordingly, I do not find that, on a balance of probabilities, the evidence presented by Liberty Mutual impugns Mr. Kabboul's credibility.

2. Findings on the Medical Evidence

In order to succeed in his claim, Mr. Kabboul must prove on the balance of probability that pursuant to section 7 of the Schedule, he suffers a "substantial inability to perform the essential tasks" of pre-accident employment as a result of the car accident on September 12, 1994.

For the following reasons, I find that Mr. Kabboul has satisfied his burden of proof.

It is clear from the medical evidence that prior to the accident, Mr. Kabboul had been working full time as a limousine driver and had not sought any medical treatment for physical pain or depression. Immediately after the accident, because of his injuries, Mr. Kabboul was unable to work. Thus, began the downward spiral of his life.

While Mr. Kabboul may have had what would appear to be a minor accident, it nevertheless had a very dramatic effect on his life. It would appear that the injuries from the car accident started a chain of events which resulted in Mr. Kabboul becoming physically and psychologically disabled. It resulted in his losing his business and the harmony in his family life. It resulted in his not being able to work as a limousine driver

The evidence reveals that since the car accident, Mr. Kabboul has been examined and assessed by more than two dozen medical practitioners, including orthopaedic surgeons, physiatrists, neurologists, neurosurgeons, urologists, psychiatrists, rheumatologists, chiropractors, physiotherapists and acupuncturists. As well, he has undergone 300 treatments for his physical pain, has taken numerous medications,⁴ and has been receiving psychiatric treatment for depression since April 1995.

In terminating Mr. Kabboul's IRBs, Liberty Mutual chose to rely on the CBI report of May 28, 1996, Dr. Urovitz's IME of June 13, 1996, and the Disability DAC of October 3, 1996.

I give little weight to the CBI conclusion that Mr. Kabboul was physically capable of returning to his pre-accident employment. As noted above, the CBI only administered three out of nine tests on the first day of testing, and no tests on the second day because Mr. Kabboul was unable to attend. In my view, given the incompleteness of the testing, I find that the CBI lacked an objective, verifiable basis to draw its conclusion.

I also give little weight to Dr. Urovitz's conclusion that Mr. Kabboul was not substantially disabled from his pre-accident occupation or any alternative occupation. Dr. Urovitz's diagnostic findings in my view are ambiguous. In his conclusion, Dr. Urovitz states that Mr. Kabboul either has chronic pain syndrome, or in the alternative, there is voluntary simulation of symptoms for the purpose of secondary gain. Dr. Urovitz, however, does not explain or elaborate on how, from this ambiguous conclusion, he makes his distinct finding that Mr. Kabboul is not disabled from his employment. Significantly, he does not elaborate on what effect Mr. Kabboul's "chronic pain syndrome" would have on his ability to work.

I note that in his report, Dr. Urovitz states that he had not received or reviewed all of the medical tests performed on Mr. Kabboul, but presumes they would not indicate any abnormality. Given the seriousness of his findings, the lack of a complete medical history, and the ambiguity of his diagnosis, I give little weight to Dr. Urovitz's conclusion that Mr. Kabboul was not disabled from his pre-accident occupation or any alternative occupation.

I give little weight to the October 3, 1996 Disability DAC's conclusion that Mr. Kabboul was not physically or psychologically disabled from performing the essential tasks of his pre-accident occupation. The findings of the DAC doctors were that Mr. Kabboul had neck and back pain, headaches, depression, muscular pain syndrome, "a non-specific back pain type of syndrome or chronic fibromyalgia" and long-term chronic pain behaviour with symptom magnification as a major presentation. As well, the DAC's Functional Capacity Assessment found that Mr. Kabboul "was clearly below the functional abilities needed to return to his pre-accident occupation."

The medical assessors, however, avoided attributing any of Mr. Kabboul's medical problems to the car accident. Dr. Kim attributed Mr. Kabboul's headaches to family and financial stresses and to the side effects of his medication. Mr. Kabboul's muscular pain syndrome was attributed to lack of conditioning. Dr. Debow concluded that it was Mr. Kabboul's continuing marital discord that was preventing him from returning to his previous occupation.

Although Dr. Waller opined that Mr. Kabboul may have "chronic fibromyalgia," he did not comment on what effect the pain had on Mr. Kabboul's functioning. Nevertheless, he concluded that from a neurological perspective, something which was never at issue, there was nothing preventing Mr. Kabboul from performing the essential tasks of his pre-accident employment.

Consideration was not given to the fact that prior to the accident there was no medical evidence to indicate that Mr. Kabboul had been suffering from chronic headaches, chronic fibromyalgia, depression, muscular deconditioning, financial stress and marital discord. In fact, a review of the medical history would indicate that these were conditions that arose after the accident. I, therefore, give little weight to the DAC's conclusion that marital discord was at the root of Mr. Kabboul's problems.

I give greater weight to the conclusions of the medical rehabilitation DAC of November 22, 1995.

The DAC assessment acknowledged that Mr. Kabboul's medical problems were as a result of the accident. Dr. Dorman, in his report, concluded that Mr. Kabboul was still affected by the injuries sustained in his motor vehicle accident. It was his view that Mr. Kabboul's symptoms and disabilities stem from a combination of physical and psychological problems and that he was "suffering from an extensive generalized myofascial pain syndrome which resembles fibromyalgia."

In my opinion, the medical-rehabilitation DAC's findings that Mr. Kabboul's pain syndrome resembled fibromyalgia is consistent with Dr. Waller's findings in the disability DAC, and with the conclusion of the rheumatologist, Dr. Stewart, in her very detailed report of February 6, 1998. Similarly, Dr. Martin's conclusions in the medical rehabilitation DAC, that as a result of the accident Mr. Kabboul had developed a "pain dysfunction syndrome," is consistent with the numerous other medical opinions presented on behalf of Mr. Kabboul. For example, see the reports of Drs. R. Wilson, Schacter, Marciniak, Crisp and Woolford.

As well, the vocational assessment by Sibley and Associates accepted the findings of the medical rehabilitation DAC report, and in its report of February 9, 1996, states that Mr. Kabboul is unable to meet the physical expectations of his pre-accident job of a limousine driver, and recommended that Mr. Kabboul participate in secondary occupations, or possibly light duty occupations allowing for suitable modifications to accommodate Mr. Kabboul's physical limitations."

I give little weight to the medical opinions that conclude that Mr. Kabboul was demonstrating excessive illness behaviour and engaging in pain magnification for secondary gain. I agree with the conclusion of Dr. Stewart, that Mr. Kabboul has, in fact, lost a considerable amount in his life since the accident — he is not able to work; he is in complete financial ruin; his relationship with his family has deteriorated; he is taking numerous medications for his pain and depression, and is under psychiatric treatment. I accept her finding that Mr. Kabboul is genuinely" disabled as a result of chronic pain that he developed from his injuries in the car accident.

Accordingly, for all of the above reasons, I find that pursuant to section 7 of the Schedule, Mr. Kabboul has proven on a balance of probabilities that he is substantially disabled from performing the essential tasks of his pre-accident employment. Accordingly, Mr. Kabboul is entitled to income replacement benefits pursuant to section 7 of the Schedule from October 8, 1996 and ongoing.

3. Loss of Earning Capacity Benefit

Pursuant to paragraph 21(1)(1) of the Schedule, an insurer is required to promptly deliver a written LECB offer if an insured person qualified for weekly income replacement benefits pursuant to Part II of the Schedule, and continues to qualify for those benefits 104 weeks after the onset of the disability in respect of which he or she first qualified for those benefits.

Having found that Mr. Kabboul is entitled to income replacement benefits at 104 weeks after the onset of his disability and ongoing, I find that Liberty Mutual is required to promptly deliver a written LECB offer to Mr. Kabboul pursuant to paragraph 21(1)(1) of the Schedule.

4. Medical Rehabilitation Benefits

Mr. Kabboul claims the sum of $13,964.60 for the payment of medical rehabilitation services he received from January 24, 1996 to July 27, 1998 pursuant to section 36 of the Schedule. In order to succeed in his claim, Mr. Kabboul must show that on a balance of probabilities, these treatments were reasonable and necessary.

The treatments Mr. Kabboul received were provided by the Sports Medicine and Rehabilitation Clinic which is owned by Dr. Marciniak. Dr. Marciniak testified that the treatments received were reasonable and necessary, and that Mr. Kabboul continues to require further treatment to break the chronic pain cycle that has developed since the accident.

Liberty Mutual pointed out that Mr. Kabboul has undergone 300 treatments provided by the Sports Medicine and Rehabilitation Clinic with no apparent success. Liberty Mutual submitted that these treatments, which included physiotherapy, chiropractic adjustments, acupuncture, massage and electrotherapy were excessive, and that the medical evidence reveals that at least since the November 1995 DAC, the treatments were not reasonable or necessary.

Liberty Mutual submits that Dr. Marciniak is not an objective, independent medical assessor because he has a financial interest in the outcome of this hearing as it relates to Mr. Kabboul's claim for physiotherapy and other treatments.

I agree with Liberty Mutual's submissions. Except for Dr. Marciniak's recommendation that Mr. Kabboul required ongoing physical treatments, the majority of the medical practitioners who examined Mr. Kabboul since the November 1995 DAC were of the view that Mr. Kabboul would not benefit from any further form of physical treatment.

A number of Mr. Kabboul's own medical assessors were of the opinion that instead of physical treatment, it was preferable for him to have ongoing psychological counselling, pain management, including behavioural modification, as well as analgesics to control his pain. These assessors include:

• Dr. I. Bernard Schacter, a neurosurgeon, who in May 1996 recommended that Mr. Kabboul's treatment should be directed at his non-physical problems, and that consideration should be given to a work-hardening type of physical program that might allow him to get back into the workforce at some future date.

• Dr. R. Shariff, Mr. Kabboul's family doctor, on August 7, 1996, stated that Mr. Kabboul did not require any specific treatment at that time except for analgesia, as needed.

• Dr. Dana Wilson, an orthopaedic surgeon who assessed Mr. Kabboul on November 7, 1996, also stated that Mr. Kabboul did not believe that any form of physical treatment will benefit him at this stage. His recommendation was that the only form of treatment should be ongoing psychological counselling with a plan for behaviour modification.

• And finally, Dr. Bernard Woolford, an orthopaedic surgeon who prepared a medical/legal report on January 19, 1998, stated that it was difficult to offer Mr. Kabboul any treatment other than simple analgesics and muscle relaxants or anti-inflammatory pills as indicated.

In conclusion, I find that Dr. Marciniak's opinion that Mr. Kabboul required ongoing treatment, when balanced against the weight of the other medical opinions, is not persuasive. I prefer the medical opinions of the medical rehabilitation DAC and the other medical assessors who have all concluded that ongoing physical therapy would not assist Mr. Kabboul with his chronic pain. Accordingly, I find that Mr. Kabboul is not entitled to his expenses of $13,964.60 for treatment provided by the Sports Medicine and Rehabilitation Clinic.

5. Quantum

Liberty Mutual disputes the quantum of Mr. Kabboul's income replacement benefit. Mr. Kabboul submits that the quantum of his income replacement benefit for the amount of $273.20 was settled at a mediation hearing on March 22, 1995, and that Liberty Mutual is bound by this settlement agreement.

The two issues I must decide regarding the amount of Mr. Kabboul's income replacement benefit are: one, was the quantum of Mr. Kabboul’s income replacement benefit settled in mediation; and, two, if the quantum issue was not settled, what is the correct amount of Mr. Kabboul's income replacement benefit?

(i) Was the Quantum of Mr. Kabboul's Income Replacement Benefit Settled at Mediation?

For the following reasons, I find the amount of Mr. Kabboul’s income replacement benefit was not settled at mediation.

In the mediator's report dated March 22, 1995, under the heading "ISSUES REMAINING IN DISPUTE," the mediator reported that there were two issues in dispute. One issue dealt with who the "primary insurer" was, and the other issue was "quantum."

Regarding the quantum issue, the mediator reported that the parties intended to proceed, without prejudice, to their respective positions, whereby Liberty Mutual would pay Mr. Kabboul an income replacement benefit of $273.20 per week from one week after the September 12, 1994 accident.

Under the "Procedural Agreement" section of the report, the mediator stated that "Liberty Mutual will consider any further information about the weekly rate of Mr. Kabboul's income replacement benefits." The mediator concluded her report on the issue of quantum stating that "Mr. Kabboul, Liberty Mutual, and GAN did not resolve their dispute at mediation." [emphasis added]

Up until the time of the mediation, Mr. Kabboul was paid an income replacement benefit of $185 a week. After the mediation, on March 27, 1995, Ms. Linda Liorti, from Liberty Mutual's Claims Department, wrote to Mr. Kabboul's counsel and advised that Mr. Kabboul's "... Income Replacement Benefits were reassessed to reflect the weekly rate of $273.20."

On April 3, 1995, Mr. Kabboul's counsel wrote to Mr. John McLean of the Claims Department at Liberty Mutual. The letter stated:

This is further to the failed mediation conducted on March 22, 1995.

I understand that Mr. William Hagan will be in touch with my client's bookkeeper and will be back to you within a week or two.

Would you be kind enough to advise of your final position within several weeks so that my client can decide whether to proceed with Arbitration or not. [emphasis added]

On April 7, 1995, Mr. William Hagan, Manager-Corporate Financial at Liberty Mutual, wrote to Mr. Aslam Salem, an accountant hired by Mr. Kabboul, requesting further financial information from him in order to determine the amount of Mr. Kabboul's income replacement benefit.

On May 1, 1995, Mr. Hagan again wrote to Mr. Salam stating that he had previously written to him, and had left several messages on his answering machine, but had no response from him. Mr. Hagan again requested Mr. Salam's assistance in resolving the amount of Mr. Kabboul's income replacement benefit.

There was no evidence presented to indicate if Mr. Salam responded to Mr. Hagan. However, in a letter dated February 23, 1996, Ms. Lesley Kellock from Liberty Mutual's Claims Department wrote to Mr. Kabboul and advised him that she had assigned his file to the accountants of

J.P. Flanagan & Associates ("J.P. Flanagan"). She also advised him that the accountant would require his "... 94 and 95 Tax Returns, Notice of Assessments, Financial Statement, Bank Statements, etc." [emphasis added]

On March 7, 1996, Ms. Debra Chiasson of J.P. Flanagan faxed Mr. Kabboul's counsel, requesting additional information to finalize their calculations. The information requested included Mr. Kabboul's 1994 and 1995 Income Tax Returns and Notices of Assessment; Revenue Canada Notices of Assessment of Mr. Kabboul's income tax returns for 1991, 1992 and 1993; run sheets from the period of January 1 - September 12, 1994, and confirmation of the periods worked and income earned subsequent to the September 12, 1994 motor vehicle accident.

On March 8, 1996, Mr. Kabboul’s counsel wrote to Ms. Chiasson. In his letter he stated:

I spoke briefly to Lesley Kellock on March 7th. Lesley did not appear to be aware of the facat [sic] that Income Replacement Benefits had been previously calculated as a result of a mediation application which I had made on behalf of my client. There should be no need to go through this process again.

Please check with Lesley Kellock and straighten out this situation.

On March 12, 1996, Mr. Kabboul's counsel wrote to Ms. Kellock. He stated that he had her letter of February 23, 1996, and that he is confirming their "brief" telephone conversation of March 7, 1996. In his letter he stated:

As I indicated to you, the quantum of [Mr. Kabboul's] benefits was resolved by way of a mediation application in March of 1995. The quantum was agreed to you by letter from Linda Liorti of your office dated March 27, 1995. The quantum was agreed to at $273.20 a week. My client advised me after our telephone conversation that he had not filed the 1994 [tax] return although all income information had been supplied to your company for 1994. He did not file of [sic] 1994 return because he owes Revenue Canada money and he does not have the income to pay. Similarly, he does not intend to file a 1995 return for the same reason. This will just reopen the question of what he owes to Revenue Canada. [emphasis added]

No mention was made in this letter that this was a failed mediation and that the mediation agreement was made without prejudice" to the parties' respective positions.

On April 4, 1996, Ms. Chiasson wrote to Mr. Kabboul's counsel confirming that Liberty Mutual had advised her that Mr. Kabboul's income replacement benefits had been agreed to during mediation and that she did not require the requested information in her letter of March 7, 1996. However, she did state that Liberty Mutual needed to confirm that Mr. Kabboul had not earned any post accident income. In order to do so, she enclosed a Revenue Canada Consent Form T1013. She stated: This will independently confirm for us which income tax returns Mr. Kabboul has filed with Revenue Canada and whether or not they were assessed as filed." [emphasis added]

Unbeknownst to his counsel, Mr. Kabboul had in fact filed a 1994 tax return on May 3, 1995. Contrary to his March 1995 statement of income, which calculated his gross income to be $64,300, his gross income on his tax return was calculated as $35,635.72. In the course of obtaining productions for arbitration, Liberty Mutual received a copy of Mr. Kabboul's 1994 tax return and discovered the discrepancy in his gross and net incomes, as compared to the March

1995 statement of income. Liberty Mutual submits that the quantum issue was not settled at mediation and that the amount of Mr. Kabboul's income replacement benefit continues to be in dispute.

Mr. Kabboul submits that an agreement exists on the issue of quantum which disentitles Liberty Mutual from reopening the question of quantum. In support of his position, Mr. Kabboul relies on the letter sent by Ms. Liorti on March 27, 1995, stating that his income replacement benefit has been assessed at $273.20. As well, he relies on the correspondence by his counsel to Ms. Kellock on March 12, 1996 and the letter sent by Liberty Mutual’s accountants on April 4, 1996, acknowledging that the quantum issue had been agreed to at mediation.

In my view, this correspondence does not bind Liberty Mutual to the amount agreed to at the mediation. The evidence indicates that this was a failed mediation. The correspondence shows that after the mediation, Liberty Mutual tried to obtain further information to calculate Mr. Kabboul’s income replacement benefit. Even after Mr. Kabboul advised Liberty Mutual in March

1996 that he had not filed a 1994 tax return (and Liberty Mutual was led to believe that the status quo prevailed), Liberty Mutual's accountant's letter of April 7, 1996 indicates that independent confirmation, in the form of income tax returns, was still being sought to fully assess the amount of Mr. Kabboul’s income replacement benefit.

In summary, I find that the mediation on March 22, 1995 failed and that the issue of quantum was not settled. I find that the agreement at mediation was "without prejudice" to the parties' respective positions, and Mr. Kabboul was put on notice that Liberty Mutual would seek further information to confirm the correct amount of Mr. Kabboul's income replacement benefit. I find that after the mediation, Liberty Mutual continued to seek further income and expense information including up until a year after the mediation. I find that in March 1996, Mr. Kabboul misled his counsel regarding the filing of his 1994 tax return, and thus misled Liberty Mutual into believing the status quo prevailed. As a result of this misinformation, Liberty Mutual advised its accountant, Ms. Chiasson, that the amount was settled. Given that Mr. Kabboul was the source of the misrepresentation, I find that Ms. Chiasson's letter of April 4, 1996, confirming that the amount of Mr. Kabboul's income replacement benefit was settled at mediation, is not binding on Liberty Mutual.

Accordingly, for the above reasons, I find that the issue of Mr. Kabboul's income replacement benefit was not settled at the mediation hearing on March 22, 1995, or at any time thereafter, and Liberty Mutual is open to dispute the amount of his benefit.

(ii) What is the correct amount of Mr. Kabboul's Income Replacement Benefit?

Mr. Kabboul claims that the correct amount of his income replacement benefit is $273.20.

Pursuant to section 10 of the Schedule, the onus is on Mr. Kabboul to establish, on a balance of probabilities, the amount of his income replacement benefit. For the following reasons, I find that Mr. Kabboul has not discharged his onus.

The income statement setting out Mr. Kabboul's income and expenses for 1994 was prepared by Mr. Salam. This was an unaudited income statement. Unlike an audited income statement, which requires that every detail regarding income and expense be verified, the information Mr. Salam used was derived from general summaries of expenses and income, prepared by Mr. Kabboul, along with some original documentation.

In a letter dated March 8, 1995, Mr. Salam stated that Mr. Kabboul had provided him with his 1994 income and expense information, and that Mr. Kabboul’s 1994 tax return was in the process of being prepared. As well, he stated that Mr. Kabboul's "... total income for tax purposes to be in excess of $23,000 approx." [sic].

As noted above, in 1992 Mr. Kabboul started his own limousine company, AERO Travel Service Limited, which provided limousine service to the airport. According to his income tax returns in 1992, Mr. Kabboul earned a gross income of $50,765.80 and a net income of $3,328.55. In 1993, Mr. Kabboul earned a gross income of $47,523.68 and a net loss of $6,495.32.

In 1994, Mr. Kabboul claims that from January until the date of the accident in September, he had a gross income of $64,300. This would extrapolate to approximately $90,000 for the year. Mr. Kabboul testified that the reason for the substantial increase in his income in 1994 was because he had acquired some new corporate clients.

Mr. Kabboul testified that the reason he filed a lower gross income in his 1994 tax return was because he did not have the money to pay taxes for the higher amount that was indicated in the March 1995 statement of income.

Mr. Kabboul testified that on October 27, 1999, he submitted to Revenue Canada a revised tax return for 1994. In the amended tax return, he claims an additional gross income of $28,664.28 to be added to the $35,635.72 gross income recorded in the original 1994 tax return. Mr. Kabboul's net income in the original tax return was $1,924.72. While there was a significant increase in his gross income, the expenses in the amended tax return did not change from the original 1994 tax return. Mr. Kabboul admitted that there was an error regarding expenses in the amended 1994 tax return, and submitted that this error would be rectified with another amended return.

Mr. Kabboul further testified that he did not have any original documentation to support the amount he is claiming. Both Mr. and Mrs. Kabboul testified that Mrs. Kabboul destroyed all business documents and records by May 1, 1995, because she was under the impression that the issue of quantum was settled and the documents were no longer needed.

As noted above, Mr. Salam did not have a detailed and complete record of the documents when he prepared Mr. Kabboul's statement of income. Instead, he relied on summaries of income and expenses prepared by Mr. Kabboul, along with some original documentation. Mr. Salam, however, testified that he was satisfied that he had enough information to come to the figures that he arrived at. He also testified that he had prepared Mr. Kabboul's 1994 tax return, with the lower income amounts, on the understanding that when Mr. Kabboul had more money to pay tax, Mr. Kabboul would amend and refile his 1994 tax return.

Mr. Kabboul submitted that I should accept the statement of income prepared by Mr. Salam in March 1995, and the recently refiled tax return of October 1999 (to be further amended), as an accurate reflection of his income for 1994.

Liberty Mutual submitted that it is the original 1994 tax return that represents Mr. Kabboul's true earnings for 1994. Liberty Mutual pointed out that the gross and net income, as well as the business expenses recorded in Mr. Kabboul's 1994 tax return, are very much in keeping with his tax returns for 1992 and 1993.

Liberty Mutual submitted that Mr. Kabboul has not presented any documentation to support his claim that he earned more income than he reported in his original 1994 return. He has not provided any receipts, run sheets, credit card slips or cancelled cheques. As well, Liberty Mutual submitted that although Mr. Kabboul testified that he could not have lived on the income reported in his original 1994 tax return, he did not present any documentation to show the amount of his mortgage payments and other home expenses to indicate the lifestyle he led would have required a higher income than that reported in the original 1994 tax return.

Liberty Mutual submitted that I should disregard Mr. Kabboul’s testimony that the reason he earned more money in 1994 than in 1993 is because he had acquired new corporate clients. Liberty Mutual pointed out that according to Mr. Kabboul’s testimony, he had worked the same amount of hours a week in 1993 as he did in 1994, and his claim that new corporate clients made the difference for the greater income is not substantiated by any objective evidence. Liberty Mutual further submitted that the filing of a revised 1994 tax return five days before the arbitration hearing should be viewed as a self-serving act on the part of Mr. Kabboul who would benefit from the higher quantum.

I agree with Liberty Mutual’s submissions. Mr. Kabboul has not presented any cogent or probative evidence to substantiate the dramatic rise in his gross income from $50,765.80 in 1992 and $47,523.68 in 1993 to an extrapolated amount of $90,776.25 in 1994. He has not provided any original documentation or any other independent, objective, reliable evidence to prove that his net income was any different than what he reported in his May 3, 1994 tax return.

Although Mr. Salam testified that he was satisfied that he had the documentation to arrive at the figures he did for the statement of income, this documentation, by his own admission, was not detailed or complete and consisted in part of summaries of income and expenses prepared by Mr. Kabboul. In my view, the filing of a new 1994 tax return on October 27, 1999, based on the statement of income prepared by Mr. Salam in March 1995, is insufficient proof that this was Mr. Kabboul’s true income for 1994.

For all of the above reasons, I find that, on a balance of probabilities, the May 3, 1994 tax return represents Mr. Kabboul's earnings for 1994. Liberty Mutual advised that if I make this finding, it has been agreed that Mr. Kabboul's income replacement benefit should be $185. Accordingly, I find that pursuant to section 10 of the Schedule, Mr. Kabboul's income replacement benefit is $185.

6. Repayment

Liberty Mutual submits that if the rate of Mr. Kabboul's income replacement benefit is found to be $185, then pursuant to subsection 70(1) of the Schedule, Liberty Mutual is entitled to a repayment of the difference between the benefits paid to Mr. Kabboul at the rate of $273.20 a week and the rate of $185 for a total of $9,387 plus interest.

Subsection 70(1) of the Schedule provides that a person shall repay to the insurer any benefit received that is paid to the person through error, wilful misrepresentation or fraud.

Liberty Mutual submits that Mr. Kabboul misled Liberty Mutual by advising Liberty Mutual that he did not file a 1994 tax return when he had in fact done so approximately six weeks after the March 1995 mediation agreement. Liberty Mutual submitted that it should not be precluded from its right to recover an overpayment because it decided to pay benefits pending the receipt of further evidence. I agree.⁵

As I found above, Mr. Kabboul misled Liberty Mutual when he stated that he did not intend to file a 1994 tax return. In my view this was a material misrepresentation as it significantly affected the amount of the income replacement benefit that Liberty Mutual paid.

I do not accept Mr. Kabboul's excuse for not informing Liberty Mutual of the original 1994 tax filing, namely that he intended to refile an amended tax return when he had the money to pay taxes on the higher income. I find it highly suspect and self-serving on the part of Mr. Kabboul that five days prior to the arbitration hearing, when the issue of quantum was in dispute, he amended and refiled his 1994 tax to reflect a higher rate of income. As I noted above, Mr. Kabboul did not provide any supporting cogent, probative documentation to substantiate the higher rate of gross income, and I do not accept the refiled tax return is an accurate reflection of his income for 1994.

I, therefore, find that Mr. Kabboul materially contributed to the overpayment and is required to repay Liberty Mutual the difference between $273.20 and $185 paid to him from one week after the accident until October 7, 1996. Liberty Mutual submitted that if repayment is ordered, then it was agreed at the hearing that the repayment should be set-off against any income replacement benefits that Mr. Kabboul was awarded pursuant to section 70 of the Schedule.

Accordingly, I find that pursuant to subsection 70(1) of the Schedule, Mr. Kabboul shall repay Liberty Mutual the amount of $9,387 plus interest, and that this amount be off-set against the monies awarded to Mr. Kabboul pursuant to section 7 of the Schedule.

EXPENSES:

If needed, I may be spoken to on the issue of expenses.

April 10, 2000

Joyce Miller Arbitrator

Date

Neutral Citation: 2000 ONFSCDRS 72

FSCO A97-002029

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

NIZAM KABBOUL

Applicant

and

LIBERTY MUTUAL INSURANCE COMPANY

Insurer

ARBITRATION ORDER

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

1. Liberty Mutual shall pay Mr. Kabboul a weekly income replacement benefit of $185 from October 8, 1996 and ongoing pursuant to section 70 of the Schedule.

2. Liberty Mutual shall forthwith make an LECB offer to Mr. Kabboul pursuant to section 21 of the Schedule.

3. Liberty Mutual shall pay Mr. Kabboul interest on outstanding amounts owing.

4. Mr. Kabboul shall repay Liberty Mutual the amount of $9,387 plus interest pursuant to sections 68 and 70 of the Schedule.

5. Liberty Mutual shall set-off the amount of $9,387 plus interest against the monies it owes Mr. Kabboul for ongoing income replacement benefits.

April 10, 2000

Joyce Miller Arbitrator

Date

Footnotes

1. 1The Statutory Accident Benefits Schedule — Accidents after December 31, 1993 and before November 1, 1996, Ontario Regulation 776/93, as amended by Ontario Regulations 635/94, 781/94, 463/96 and 304/98. O.R. 776/93 was extensively modified by O. R. 781/94; accordingly, where necessary, "1994 Schedule" refers to the original O.R. 776/93, and "1995 Schedule" refers to O.R. 776/93 as amended.
2. 2About a week after the accident, Mr. Kabboul underwent X-Rays on the recommendation of Dr. Shariff. The report of the X-Rays similarly noted that Mr. Kabboul had a bilateral spondylolysis with a mild spondylolisthesis of the lumbar spine. The report, however noted that the findings are not related to trauma but are congenital.
3. 3(OIC A95-000188, July 8, 1996)
4. 4The medications Mr. Kabboul consumed included Parxetine, Clorazepam, Temazepam, Lorazepam, Robaxicil, Robaxacet and Tylenol No. 2 and extra strength.
5. 5See Upper and Canadian General Insurance Company (OIC A-002855, June 3, 1994)