Neutral Citation: 2002 ONFSCDRS 39

FSCO A99-000699

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

VANESSA FEHRINGER

Applicant

and

ZURICH INSURANCE COMPANY

Insurer

REASONS FOR DECISION

Before:

Suesan Alves

Heard:

September 11, 12 and 13, 2000, at the Offices of the Financial Services Commission of Ontario in Toronto.

Appearances:

Jeffrey Raphael for Ms. Fehringer

William J. McCorriston for Zurich Insurance Company

Issues:

The Applicant, Vanessa Fehringer, was injured in two motor vehicle accidents on January 10, 1996 and on July 1, 1996. Zurich Insurance Company ("Zurich") is the insurer which is obliged to pay Ms. Fehringer's statutory accident benefits under the Schedule in relation to both accidents.¹ In this arbitration Ms. Fehringer claims various statutory accident benefits, interest, a special award and her expenses in respect of the arbitration. Zurich disputes all of Ms. Fehringer's claims and claims its expenses of the arbitration.

The parties were unable to resolve their disputes through mediation, and Ms. Fehringer applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended. The parties agreed that Ms. Fehringer's claims for personal training and gym membership would not be part of this arbitration. Ms. Fehringer withdrew her claims for loan interest payments and Zurich agreed to pay her outstanding prescription expenses.

The issues in this hearing are:

1. Did Ms. Fehringer release her claims for loss of earning capacity benefits? If not, is she entitled to an offer in respect of weekly loss of earning capacity benefits pursuant to section 20 of the Schedule?

2. Is Ms. Fehringer entitled to massage therapy, chiropractic services, transportation expenses, nutritional supplements, and a mattress box spring as supplementary medical expenses under section 36(1) of the Schedule?

3. Is Ms. Fehringer entitled to reimbursement at the rate of $200 per month for services rendered as attendant care, housekeeping and home maintenance under sections 47 and 55 of the Schedule

4. Is Ms. Fehringer entitled to a special award under section 282(10) of the Insurance Act, R.S.O. 1990, c.I.8, as amended?

5. Which party is liable to pay the other's expenses under section 282(11) of the Insurance Act, R.S.O. 1990, c.I.8, as amended?

Ms. Fehringer claims interest on overdue benefits.

Result:

1. Ms. Fehringer did not release her claims for loss of earning capacity benefits. She was entitled to an offer in respect of weekly loss of earning capacity benefits pursuant to section 20 of the Schedule by August 10, 1998.

2. Ms. Fehringer is entitled to massage therapy, chiropractic treatment, transportation expenses, and a mattress box spring as supplementary medical expenses under section 36(1) of the Schedule. She is not entitled to payment for nutritional supplements.

3. Ms. Fehringer is entitled to reimbursement at the rate of $200 per month for services rendered as attendant care, housekeeping and home maintenance between August 1997 and September 2000 under sections 47 and 55 of the Schedule

4. Ms. Fehringer is entitled to interest on overdue benefits under section 68 of the Schedule.

5. Ms. Fehringer is entitled to a special award of 15% in relation to prescription expenses, and 25% in relation to the mattress box spring, and some massage and chiropractic treatments under section 282(10) of the Insurance Act. I remain seized of this question if the parties are unable to agree upon the amount.

6. If the parties are unable to agree upon expenses, that issue may now be addressed.

EVIDENCE AND ANALYSIS:

Background

Vanessa Fehringer was injured in two motor vehicle accidents in 1996. Zurich is the insurer which is obliged to respond to Ms. Fehringer's claims for statutory accident benefits as a result of each of the accidents.

Ms. Fehringer was 21 years of age at the time of the first accident, and 22 years of age by the time of the second. Prior to the motor vehicle accidents, Ms. Fehringer had asymptomatic spinal stenosis in her low back, along with asymptomatic minor degenerative changes in the last apophyseal joints of her spinal column. She had no previous significant injuries or musculoskeletal problems, enjoyed good health, and lived a busy, active, social life. Ms. Fehringer sustained a herniated disc in her low back in the second accident, as well as soft tissue injuries in each of the accidents.

In this arbitration Ms. Fehringer claims entitlement to an offer in respect of loss of earning capacity benefits ("LECBs"). Ms. Fehringer acknowledges that she signed a full and final release in favour of Zurich in December 1997. She alleges that she only released her entitlement to income replacement benefits ("IRBs"), not her entitlement to LECBs. Zurich alleges that Ms. Fehringer also released her entitlement to loss of earning capacity benefits in December 1997. In the alternative, Zurich submits that even if Ms. Fehringer only released her entitlement to IRBs, since she did so before the 104-week mark, she is no longer entitled to LECBs or to a LECB offer. Zurich further submits that Ms. Fehringer's post-accident earnings likely exceed her pre-accident earnings, reducing any entitlement to LECBs to zero.

Did the Applicant release her entitlement to LECBs?

Zurich paid Ms. Fehringer one week of income replacement benefits in the amount of $208.91 in March 1996. On December 10, 1997, Ms. Fehringer signed a release in favour of Zurich, and Zurich agreed to pay her $9,400 with respect to her claims for income replacement benefits in relation to both accidents. For reasons set out below, I find that Ms. Fehringer did not release her entitlement to loss of earning capacity benefits in December 1997.

Mandatory disclosure statement

The mandatory disclosure statement, a document which insurers are required to provide before entering into a settlement with an insured person, contains two paragraphs which show what the Insurer intended to settle.² Paragraph I describes the benefits that may be available to Ms. Fehringer under the Schedule, while paragraph II describes the impact of the settlement on those benefits.

In essence, paragraph I enumerates all the benefits available under the Schedule and the contract in paragraphs lettered A. to L. Paragraph I D. sets out the income replacement, non-earner, education, caregiver, and loss of earning capacity benefits as follows:

D. Loss of income benefits while disabled based on 90% of net income from employment, less collateral benefits and post-accident income.

There is a separate benefit of $185.00 per week for persons who are not employed.

There is a separate benefit of $256.26 [or more for each person being cared for, other than the first] for disabled caregivers.

There is a disability benefit for students based on net income related to Gross income equal to the Ontario Average Weekly industrial wage. The percentage payable ranges from 50% of the net amount to 90%.

The maximum weekly amount payable is $1,025.05.

A further benefit is payable for persons who suffer a net loss of earning capacity and are disabled for 2 years.

Benefits payable to a person after the age of 65 years are reduced.

Paragraph II of the mandatory disclosure statement states:

II. A DESCRIPTION OF THE IMPACT OF THE SETTLEMENT ON BENEFITS DESCRIBED ABOVE.....

A. As a term of the settlement you will forego the right to claim any income replacement benefits under Part 2, Education Disability Benefits under Part 3 or Other Disability Benefits under Part 5 of Regulation 776/93 in respect of motor vehicle accidents which took place on January 10, 1996 and July 1, 1996.

B. As a term of the settlement you will agree not to mediate, litigate, arbitrate, appeal or apply to vary an order as provided in sections 280 to 284 of the Insurance Act with respect to entitlement to benefits set out in paragraph II A. above.

C. As a term of the settlement you will acknowledge complete satisfaction of the benefits available under the contract of insurance as enumerated in paragraph II A. above

While subparagraph II A. states that Ms. Fehringer will forego the right to claim IRBs under Part II, EDBs under Part III and ODBs under Part V, there is no mention that the settlement has any impact on LECBs. In this Schedule, loss of earning capacity benefits are provided for in Part VI. Again, there is no mention that the settlement has any impact on Part VI benefits. I find the Insurer's expressed intention was to settle only Ms. Fehringer's claims for IRBs as a result of both accidents.

I find that this mandatory disclosure statement provides strong evidence that Zurich wished to settle Ms. Fehringer's entitlement to income replacement benefits from both accidents; not her loss of earning capacity benefits.³

The Release

The release consists of six paragraphs. It was drafted on Zurich's behalf by its former counsel. I find that in the event of ambiguity, the release is to be construed contra proferentem⁴ The first paragraph of the release sets out the consideration to be paid by Zurich and the extent of the release given by Ms. Fehringer. The release relates to both accidents and, although it is worded broadly as a release from all acts, causes of action... claims and demands... — by way of clarification, Ms. Fehringer wrote in the margin "THIS APPLIES ONLY TO INCOME REPLACEMENT BENEFITS," and initialled the addition.

In the second paragraph, the parties agree that the consideration shall not be construed as an admission of liability by Zurich or any other releasee.

The third paragraph states, "It is understood and agreed that this release shall only apply to income replacement benefits under Part II, Education Disability benefits under Part III and Other Disability benefits under Part V of Regulation 776/93 under the Insurance Act, R.S.O. 1990, c.I.*[sic]."

As noted earlier, under this Schedule loss of earning capacity benefits are provided under Part VI. While the release states it applies to benefits under Parts II, III and V of the Schedule, this paragraph makes no mention of a release of LECBs or of benefits under Part VI of the Schedule.

In the fourth paragraph of the release, Ms. Fehringer further agrees to indemnify and save harmless Zurich, its administrators, successors, assigns.....from all actions, damages, claims and demands which may hereafter be brought against them in relation to both accidents.

In the fifth paragraph, Ms. Fehringer agrees that the amount paid includes all claims, interest and costs, that all actions by or on her behalf against Zurich will be dismissed and that she or her agents will execute all documents necessary to effect the with prejudice dismissal of any such actions. She further agrees that this agreement represents a complete discharge of any and all of Zurich's liabilities to her "with respect to any past or future claim for benefits under Part II, Part III, and Part V of Regulation 776/93." Once again, no mention is made of Part VI benefits or of LECBs. Again, in the interests of clarity, Ms. Fehringer wrote in the margin and initialled "THIS APPLIES ONLY TO INCOME REPLACEMENT BENEFITS."

Ms. Fehringer again wrote in the margin and initialled on the second page of the release "THIS APPLIES ONLY TO INCOME REPLACEMENT BENEFITS." Because of the location of the notation and the accompanying asterisks, I find Ms. Fehringer's notation relates to the remaining subparagraphs of paragraph 5, and to paragraph 6 of the Release. In the remaining subparagraphs of paragraph five, Ms. Fehringer agrees that no mediation, arbitration, litigation, or other proceeding may be initiated or maintained with respect to any obligation of Zurich, and she acknowledges receipt of mandatory disclosure with respect to the settlement required under the Settlement Regulation.

In the sixth paragraph, Ms. Fehringer acknowledges she has read the release and understands that it is a full and final release "of all claims for damages or injuries whether such damages or injuries are known or not yet ascertained at the present time."

For these reasons, I conclude that on the face of the release Ms. Fehringer did not release her claims for loss of earning capacity benefits.

The amount of the benefit

Zurich submits that Ms. Fehringer's post-accident earnings likely exceed her earnings at the time of the accident, and she therefore has no entitlement to a LECB offer. If Ms. Fehringer's post-accident earnings exceed her earnings at the time of the accident, this will be reflected in the amount of any offer and in her LECB. I do not view Ms. Fehringer's establishment of her entitlement to an offer as an academic or a moot point. The Schedule provides lifetime entitlement to loss of earning capacity benefits, mandatory periodic reviews and further reviews in the event of a significant deterioration in condition. In the opinion of Dr. D.J. Ogilvie-Harris, one of the orthopaedic surgeons Ms. Fehringer has seen, it is more likely than not that her condition will deteriorate.

Entitlement and Qualification

Section 21 of the Schedule sets out the circumstances under which an insurer is obliged to deliver a written offer to an insured person with respect to the payment of weekly loss of earning capacity benefits. Ms. Fehringer claims entitlement to a loss of earning capacity benefit under section 21 paragraph 1. That paragraph obliges an insurer to promptly deliver a written offer to an insured person with respect to the payment of weekly loss of earning capacity benefits if:

The insured person qualified for weekly income replacement benefits 104 weeks after the onset of the disability in respect of which he or she first qualified for those benefits.

Zurich further submits that by signing the release before the 104-week mark, Ms. Fehringer cannot trigger her entitlement to a LECB since her claim for a LECB is based on her being entitled to income replacement benefits at the 104-week mark.

Section 21(1)1. provides that the insured person "continues to qualify" for income replacement benefits in order to be entitled to receive a LECB offer. It does not state that a person must be receiving an income replacement benefit. In the case of Gray and Zurich Insurance Company of Canada (FSCO P98-00047, June 11, 1999), Director's Delegate Draper made this distinction clear. He concluded that the phrase "continues to qualify" at 104 weeks means an insured person who qualified for income replacement benefits must suffer a substantial inability to perform the essential tasks of his or her employment. For these reasons I conclude that Ms. Fehringer is not precluded from entitlement to an offer in respect of loss of earning capacity benefits by signing the release.

The claim for a loss of earning capacity benefits offer:

Ms. Fehringer claimed income replacement benefits under section 7(1)1. of the Schedule. Under this section, she is entitled to an income replacement benefit if she "was employed at the time of the accident and, as a result of and within two years of the accident, suffers a substantial inability to perform the essential tasks of that employment."

In order to succeed in her claim that she was entitled to an offer in respect of loss of earning capacity benefits under section 20 of the Schedule, Ms. Fehringer must establish on a balance of probabilities that in July 1998 she was substantially unable to perform the essential tasks of her employment in January 1996.⁵

Credibility

Ms. Fehringer's employment history is complex. The parties disagree on the nature of her employment at the time of the accident and whether she meets the disability test as of July 1998. Zurich submitted that it was unclear what work Ms. Fehringer performed before the accident, at the time of the accident, and after the accident. I find that in essence Zurich challenged Ms. Fehringer's credibility, largely by attempting to raise doubt as to the accuracy of her employment history in all three periods.

Ms. Fehringer claimed an income replacement benefit based on her employment at the time of the accident. Accordingly, the relevant evidence is her actual employment at the time of the accident; not her pre-accident employment. Her pre-accident employment would be relevant to the calculation of the amount of the income replacement benefit. However, as the parties settled her IRB claim, I was not asked to decide that question.

With respect to her employment at the time of the first accident, there are some facts, inferences from those facts, and opinions set out in medical assessments which vary from my findings. For example, I accept that Ms. Fehringer modelled on a part-time basis in January 1996. I also accept her explanation for failing to disclose her work as a part-time model to Zurich. She appears also not to have disclosed this work to most medical assessors.

In addition, Ms. Fehringer testified that her part-time modelling has grown to the point where, but for her post-accident impairments, she could be employed full-time as a model. Her complaint is that she is not able to model full time because her capacity to work is no longer as great as it was before the accident. Her statements were clarified and tested during her testimony. She appears to have used similar words to medical assessors, who in turn appear to have understood that she had full-time modelling work available to her at the time of the first accident. They have gone on to provide opinions about her ability to work as a full-time model.

Zurich submits that the source of all the information is Ms. Fehringer. However, without knowing the precise questions asked by the examiners, and the answers given, it is difficult to know whether there was a memory problem, a mis-communication, an ambiguous question posed or statement made, an incorrect inference drawn or a misrepresentation. I also accept that at some point the Applicant's psychological impairments affected her concentration and memory.

In reaching my conclusions as to disability I have relied on objective evidence of her injury, the pre-accident job requirements as assessed shortly after the accident, opinion evidence as to the effects of a herniated disc on her ability to perform repetitive bending, lifting, and sitting, the consistency of her complaints with the objective evidence, as well as the testimony of Ms. Fehringer and of Mr. Bellemare, her boyfriend.

I found the testimony of Ms. Fehringer and her boyfriend, Mr. Bellemare, to be generally credible. Ms. Fehringer gave her testimony in an open, straightforward manner and made appropriate admissions in cross-examination. Although Zurich questioned her credibility on a number of points, it produced only one witness, a chiropractor at a DAC, who disagreed with Ms. Fehringer's contention that she was substantially disabled, and with the minor point of the duration of his examination.

With respect to the question of her post-accident employment and whether she accurately informed various health practitioners of the number and type of those jobs, I have provided a detailed review of the evidence, below. I have found that by juxtaposing Ms. Fehringer's history of her various attempts at working after the accidents with the medical reports, most of the references made to her jobs in the various medical reports become clear. Accordingly, I do not agree with Zurich's submissions as to the unreliability of Ms. Fehringer's evidence.

Employment in January 1996

Ms. Fehringer alleges that in January 1996, at the time of the first motor vehicle accident, she was employed at three jobs: full time as an office manager at a hair dressing salon, Salon Venere; a part-time sales associate at Benix; and a part-time model, primarily in relation to Budweiser. Zurich submits that Ms. Fehringer's application for accident benefits disclosed two jobs, one at Salon Venere and another at Benix. There was no indication on her application that she was employed at a third job.

I accept Ms. Fehringer's testimony that she was employed part time as a model at the time of the first of the accidents. I find that at the time of the first of the accidents, in January 1996, Ms. Fehringer was employed at the three jobs which she alleged. My finding is based both on her testimony and documentation which supports such pre-accident employment.⁶ It is also consistent with Zurich's Response to the arbitration application. I also find that under section 7(1)1. of the Schedule these are the jobs against which her disability is to be measured. Unfortunately, most of the medical assessments did not address her ability to perform employment as a part-time model.

Ms. Fehringer was not represented at the time she filed her application for accident benefits. She testified she sought and relied on the adjuster's advice that Zurich would only pay her benefits based on the earnings she could prove by means of pay stubs or T4s. There is some support for her evidence in the correspondence from Zurich. Zurich provided no evidence to refute Ms. Fehringer's testimony. I accept her testimony that she did not initially disclose her part-time modelling work in the application for accident benefits because she would have had difficulty substantiating the amount of her earnings from modelling, since she did not have T4s.

The notes of an intake interview done by the assistant to Dr. Young, Ms. Fehringer's treating psychologist, contained in Exhibit 3 reflect one further job. The notes do not indicate a time-frame other than "pre-accident." This statement was not put to Ms. Fehringer in her examination-in-chief, or in cross-examination. I find that there is no conclusion I can reasonably draw from that notation.

Essential Tasks

Salon Venere was a busy salon with 12 stylists. Ms. Fehringer worked as office manager five days per week, Tuesdays through Saturdays for between 35 and 44 hours per week. I find her essential tasks were to work at the front desk at which she took cash, typed, did the computer payroll, ordered stock, booked appointments, and did sales of makeup lines, hair care and skin care products. Ms. Fehringer was also responsible for shipping and receiving and for placing the stock onto the shelves. She rarely took breaks and at times did not take a lunch break. Ms. Fehringer arranged with the salon that she would be paid on the basis of the number of hours she worked, because she wished to have some flexibility to take on modelling assignments. The major physical requirements of this job at the salon involved sitting and twisting frequently at her desk most of the day. She would write orders, prepare pay cheques, and type frequently for between 1 to 4 hours a day. She did elevated work above her waist frequently throughout the day at her desk. As a shipper receiver she would lift boxes floor to waist and also horizontally. The light boxes normally weighed 10 pounds. The maximum weight would be 70 pounds and consisted of boxes containing shampoo. She would sort and assemble hair products less than an hour per day.⁷ I also find that she walked and stood while working at the salon.

I find her essential tasks as a part-time sales associate at Benix Housewares, a warehouse outlet store, were sales of sets of dishes, large and small pots and pans, crystal, and household utensils. Ms. Fehringer received shipments and put the stock onto the main floor. She also cleaned shelves when she did displays, cleaned windows, climbed a ladder to take items down for customers, and loaded and unloaded dishes. She also did cash. She worked part-time at this job typically three times per week during evenings and weekends. A shift would be between 3.5 and 9 hours, for a total of approximately 20 hours per week. She stood for most of her shift. She lifted boxes from floor to waist and also horizontally. These included boxes of dishes weighing 70 pounds. She would kneel or crouch infrequently when she put stock away. She would also push a trolley, usually containing about 200 pounds of merchandise, out to customers' cars.

Since 1998, Ms. Fehringer has performed various types of modelling. She began with hair modelling, with the cousins of the owners of Salon Venere, worked with a freelance fitness photographer and did modelling in fitness and muscle magazines. She participated in photo shoots for calendars, catalogues, flyers and posters; appeared at trade shows such as car shows, boating and fishing shows; participated in fashion and hair shows; did bikini modelling; fitness modelling; posters for Budweiser and took part in contests.

In 1995, she also began spokesmodelling twice a week with Taking Care of Business, a promotional company. Ms. Fehringer testified that in spokesmodelling a model represents a company and attends a function to attract attention to the company, promote its products and gain customers. When spokesmodelling she might attend a trade show, or a golf tournament, hand out literature, sell beer wearing the company's outfit, autograph posters, or whatever the company required. She did still photos, attended trade shows and signed posters. A shoot might last for between three to nine hours.

At the time of the first accident, one of her assignments was to work as a "Bud Girl" for Budweiser. Those jobs would come along once or twice a week. According to the report of an occupational therapist prepared in June 1999, on average, she worked two days a week, three hours per session, prior to the accidents. However, out-of-town trips during the football season to the U.S.A. with contest winners would involve travel on a bus with another "Bud Girl" to the game and travel back to Toronto. During the bus trip they took care of the contest winners. They would then travel to the stadium where the "Bud Girls" would sign autographs. Those trips involved leaving on Friday and returning on Sunday. Ms. Fehringer testified she was able to select the "good gigs." Letters from Ms. Fehringer's agents reflect highly on her professionalism, punctuality, positive attitude, warm character and pleasant disposition while on assignments.

I find her essential tasks as a part-time model involved preparing for the shoot or spokesmodelling the night before such as shaving and grooming, and interacting with the photographer and/or clients. The physical demands included sustained standing and/or sitting, and assuming and maintaining various static postures. As a "Bud Girl," she was required to wear white shoes with high heels. She was also required to stand. While doing signings, she would sit.

In combination then, I find Ms. Fehringer's worked about 60 hours per week at three jobs at the time of the January 1996 accident.

Injuries, treatment & attempts to return to work

Ms. Fehringer has moderate spinal stenosis, or a narrow spinal canal at the L5-S1 level with associated central bulging of her L4-5 and L5-S1 intervertebral discs. She also has some mild degenerative changes in the last pair of her apophyseal joints. Ms. Fehringer was asymptomatic prior to the 1996 accidents, and these conditions were diagnosed after the first accident. She had no previous significant injuries or musculoskeletal problems and enjoyed good health. However, as a result of these conditions, at the time of the accidents, she had a spine which was vulnerable to injury.

On January 10, 1996, Ms. Fehringer was driving her car along Highway 401. She had stopped for traffic in the left lane, when she was struck by a Dodge Ram. Ms. Fehringer testified that she saw the high beam of the vehicle travelling at a high rate of speed in her rear view mirror. She was able to turn her wheels to avoid striking the car ahead of her, brace herself, warn her passenger, and apply the emergency brake prior to the impact.

Ms. Fehringer saw Dr. M. Chin, her family doctor, the next day and complained of severe pain in her neck and back, headaches, lightheadedness, and difficulty sleeping. He examined her, sent her for x-rays, and prescribed anti-inflammatory and analgesic medication. Dr. Chin diagnosed soft tissue injuries to her neck and low back, and referred her for physiotherapy for relief of her pain and spasm.

Ms. Fehringer began physiotherapy at Physiotherapy Active Treatment towards Health, ("P.A.T.H."). She had very restricted lumbar range of motion, paraspinal muscle spasm and tenderness on palpation over her right sacroiliac joint. Ms. Fehringer was described as being highly motivated, and she regularly attended and participated in her physiotherapy program. Her medications included anti-depressants, anti-inflammatories and analgesics, and local analgesic creams. Despite these interventions, Ms. Fehringer complained of severe low back and neck pain, difficulty sitting, standing, bending, headaches, numbness in her posterior legs and tiring easily. In Dr. Chin's opinion, Ms. Fehringer's condition seemed to be getting worse rather than improving. He therefore referred her to a neurologist, Dr. B. Little.

In April 1996, Ms. Fehringer saw Dr. B. Little. On examination, she had restricted neck movement in all directions, with movement inducing suboccipital pain. There was mild tenderness of her suboccipital and trapezius muscles, and some tenderness in her low lumbar region. Forward bending was restricted to about 45 degrees. Extension was somewhat painful and there was restriction of right and left lateral lumbar flexion and rotation as well. Straight leg raising bilaterally in the supine position was restricted to about 35-45 degrees bilaterally. Dr. Little opined that despite normal x-rays she might well have injured her disc or have suffered nerve root irritation. Dr. Little was of the opinion that Ms. Fehringer was a very sensible and responsible individual and with the passage of time her soft tissue injury symptoms would abate.

In light of her leg paresthesiae, ongoing headache, and back pain, Dr. Little referred her for nerve conduction studies and CT-Scans of her head and low back. The CT-Scan of her head and the nerve conduction studies were normal. A CT-scan of her lumbar spine taken in May 1996 showed central bulging of her L4-5 disc, central bulging of her L5-S1 intervertebral disc, and moderate spinal stenosis. The spinal stenosis and the osteoarthritis were pre-existing conditions which were asymptomatic.

One of Ms. Fehringer's goals was to gradually return to work part time in two-three weeks while continuing an active physiotherapy program. In March 1996, she began working half a day per week at Salon Venere answering the phones and doing the cash.

On April 2, 1996, Dr. M. Hall, an orthopaedic surgeon, examined Ms. Fehringer at Zurich's request. He was of the opinion that Ms. Fehringer has had "rather more disability resulting from this injury than one would expect." He was of the opinion that she was fit to do her work as an office manager at a hair salon, and could remain off the Benix job for another four weeks. He was of the opinion that Ms. Fehringer had received all the benefit from physiotherapy that she was likely to achieve and that she should continue with self-directed measures. Dr. Hall did not have the benefit of the x-ray films or of the CT-Scan. In June 1996, Zurich terminated payment for Ms. Fehringer's physiotherapy treatment. Ms. Fehringer then obtained a gym membership and personal trainer. Her neck pain was improved, although she did have some low back pain.

In late May 1996, Ms. Fehringer told Salon Venere that she could come in for two half days a week. She did not last, could not progress to full-time work as an office manager and was replaced at her full-time job. Ms. Fehringer and Dr. Chin were hopeful that she might be able to return to work at some point in July 1996. Unfortunately, on July 1, 1996, Ms. Fehringer was again injured in a rear-end collision. This time she was a passenger in a vehicle on Highway 400 returning from holiday, when the vehicle was struck by a minivan. Ms. Fehringer was reclining on the seat and wearing her seatbelt. However, following the impact, she slid under the seatbelt and struck her right knee. Ms. Fehringer experienced sharp pain in her low back radiating into her legs, when she attempted to get out the vehicle. Her fiance's brother, who was driving another vehicle, helped her out of the vehicle, into his car and drove her home.

Two days later, on July 3, 1996, Ms. Fehringer went to the emergency department at York-Finch General Hospital and complained of severe low back pain. X-rays of her low back were negative, and she was given a prescription for Tylenol no. 3, a back instruction sheet, and was to see her family doctor the following day. Dr. Chin diagnosed an aggravation of her neck and back injuries and a contusion to her right knee.

Dr. Chin followed Ms. Fehringer on a regular basis. Her headaches and neck pain increased and she had numbness and tingling in her fingers and hands. She had pain in her paralumbar areas which went down into her sacroiliac joints, thighs, calves and feet. Dr. Chin noted that she was depressed. Her medications following the second accident included analgesics, some of which contained codeine, anti-inflammatories and anti-depressants.

Dr. Little again saw Ms. Fehringer in July 1996. He found her to be a pleasant, but tearful and tense 22 year old, who complained of sharp low back pain radiating into her buttocks, dizziness, nausea and of feeling quite miserable. On examination he found that Ms. Fehringer's lumbar spinal mobility was markedly restricted on forward bending and extension in particular, and lateral rotation was also restricted. In a supine position about 25-30 degrees of straight leg raising was allowable before he induced pain. He sent her for a repeat CT-Scan of her low back, recommended that she rest for a couple of days, take Gravol and analgesics, apply a small amount of heat two to three times a day, and arrange for a physiotherapy program in the near future.

On July 15, 1996, Ms. Fehringer again started daily physiotherapy, which she continued for about three months. She attended regularly and complied well with the active program. On discharge, she still complained of low back pain with prolonged sitting or standing, that is to say for more than half an hour, and with lifting and carrying more than 10 pounds. Her lumbar spine range of motion was moderately restricted, with most limitation in flexion and extension (50% of normal). She continued to have tenderness on palpation along her paralumbar muscles. She was discharged with a home exercise program.

On August 8, 1996, prior to the results of the CT-Scan becoming available, Dr. Chin provided a health practitioner's certificate in which his primary diagnosis was soft tissue injuries to Ms. Fehringer's thoracolumbar and lumbosacral spine, and post-traumatic stress disorder.

A repeat CT-Scan of her lumbar spine on August 16, 1996 showed a small central disc herniation at L4-5 indenting the anterior aspect of the thecal sac. Dr. D.J. Ogilvie-Harris, an orthopaedic surgeon who saw the Applicant at the request of her counsel, is of the opinion that the onset of pain such as Ms. Fehringer experienced following the second accident is consistent with disc herniation, and with the pathology shown on the CT-Scan. In his opinion, Ms. Fehringer's L4-5 disc was probably herniated as a result of the second motor vehicle accident. I accept his opinion.

Although Salon Venere replaced Ms. Fehringer as office manager, they continued to employ her for half a day as a receptionist. On September 14, 1996, Ms. Fehringer progressed from working half a day as a receptionist at Salon Venere to an eight-hour shift as a receptionist on Saturdays.

In October 1996, Dr. Chin provided a note indicating that in his opinion Ms. Fehringer was substantially unable to perform the essential tasks of her modelling, sales and hair salon jobs as a result of the motor vehicle accidents. He was also of the opinion that Ms. Fehringer had plateaued at physiotherapy. He recommended a trial of chiropractic treatment to see if she could achieve further improvement. Ms. Fehringer had chiropractic and shiatsu treatments, and was phased onto a program of cardiovascular conditioning, stretching and theraband resistance exercises.

In about November 1996, Ms. Fehringer worked her first shift at Benix as a cashier. Pre-accident she worked there as a sales associate approximately 20 hours per week. She hoped to gradually increase to her previous schedule as tolerated. In November 1996, Ms. Fehringer reported to Dr. Chin that she was feeling better overall, and had good days and bad days. In terms of work, she reported that she had stopped her bartending job at the nightclub, and only worked Saturdays at the hair salon. It is unclear when she began working at the nightclub job. A chronology she provided indicates that it was following the July 1, 1996 motor vehicle accident. She tried working one night per week as a waitress in a nightclub, but unable to cope due to her injuries and quit.

On December 6, 1996, Ms. Fehringer reported to Dr. Chin that she was going to the gym two to three times a week, doing cardio only. Dr. Chin encouraged her to also improve her strength, tolerance and flexibility.

In December 1996, Dr. T. Veiledal, the chiropractor who treated Ms. Fehringer, reported that in October 1996 she complained of daily frontal and temporal headaches, paresthesiae and weakness of both arms and both legs, generalized pain with low back pain worse than her neck pain, and that her activities of daily living were restricted due to pain and musculoskeletal function. Dr. Veiledal reported that Ms. Fehringer attended for six months and responded very well to treatment and has returned to work. Dr. Veiledal did not state where or in what capacity. However, it would appear he was referring to her work at Salon Venere as a receptionist, at Benix as a cashier, and possibly as a waitress at a nightclub.

In December 1996, Ms. Fehringer was assessed at a disability DAC conducted by Dr. R. Goldford, chiropractor, and Ms. K. Crichton, kinesiologist of Dr. Howard Seiden and Associates. They concluded that Ms. Fehringer was not substantially disabled from performing her pre-accident activities or jobs. Based on the physical examination, Dr. Goldford was of the opinion there was no impairment or disability with regard to either her pre-accident activities of daily living or to doing either of her two jobs at Benix or Salon Venere. He understood that prior to these accidents she had been working roughly 60 hours per week.

Dr. Goldford testified that Ms. Crichton conducted a functional abilities evaluation ("FAE"), which he supervised and relied upon in reaching his conclusion. Dr. Goldford reported that the results of the FAE "show that Ms. Fehringer has achieved sufficient range of motion, strength and endurance to resume all pre-accident responsibilities including any activities of daily living as well as the demands of either of her two jobs."

I am not persuaded that the DAC assessors understood Ms. Fehringer's critical work demands. The DAC assessors relied on the National Occupational Classification, Federal Government of Canada 1992, and discussion with the client to establish the criteria for Ms. Fehringer's job as a beauty salon manager. The demands as established by the DAC omit some of the heavier job requirements identified in the earliest report of Ms. Fehringer's work demands at Salon Venere and Benix, prepared by P.A.T.H. on January 30, 1996. Since the P.A.T.H. report was prepared closer to the time at which Ms. Fehringer performed the work, I find that it is more likely to be accurate than criteria established by the FAE assessor in December 1996.

According to the P.A.T.H. report, Ms. Fehringer usually lifted boxes from floor to waist and also moved them horizontally. At Salon Venere, the boxes weighed 10 pounds up to a maximum of 70 pounds when they contained shampoo. At Benix, she would lift boxes of dishes and other items weighing 70 pounds from floor to waist and horizontally on a frequent basis. The DAC used the physical demands characteristics of work from the Dictionary of Occupational Titles. According to the chart included in the FAE report, lifting 70 pounds even if done "0% to33%" of the workday is considered heavy. However, at the FAE, Ms. Fehringer was assessed on her ability to meet "light strength demands or a maximum lift of 25 pounds and a usual lift of five pounds."

The assessor reported that Ms. Fehringer used proper body mechanics during these lifts, demonstrated physical effort, measured by the increase in her heart rate; used maximum voluntary effort during tests designed to test the validity and reliability of her biomechanical performance; and was cooperative throughout the assessment. Despite these factors, in floor to knuckle lifting, Ms. Fehringer reported low back pain after the 25 pound lift. During the knuckle to shoulder lift, her low back pain started at 20 pounds and was accompanied by some shaking of her arms. I am not persuaded that it is reasonable to infer from her performance that she could lift light loads of up to 25 pounds repetitively, or that she could lift the 70 pounds required at the Salon Venere and Benix jobs.

While she was observed to sit a total of 1.5 hours during the course of the four-hour assessment, sitting and twisting frequently, another job demand at Salon Venere, according to the P.A.T.H. assessment, was not assessed. I am not persuaded that her performance met her job demands of her pre-accident work at Salon Venere or at Benix.

I am also not persuaded that the assessors understood she was performing modified work at the time the assessment was conducted. According to the FAE report, Ms. Fehringer reported "working 2 to 3 full shifts per week at beauty salon and her part-time sales position." However, both jobs were modified and less onerous than her pre-accident jobs. At Salon Venere, she was working an eight-hour shift as a receptionist, and at Benix, she went back to doing cash, to minimize the amount of constant standing. Dr. Goldford testified that he was unaware of any work modifications. In his opinion, based on his physical examination, there did not appear to be a barrier to her return to work. Ms. Fehringer testified that following the assessment at the FAE she was not feeling well and the following day she was in significant pain. Dr. Goldford allowed that this might be relevant. For these reasons, I reject the opinion of the disability DAC that Ms. Fehringer was no longer disabled.

There is a health practitioner's certificate dated December 16, 1996 completed by Dr. N.P. Stein stating that Ms. Fehringer can return to normal daily activities, part-time work and part-time school. However, she is to avoid heavy lifting, repetitive bending, prolonged sitting, standing and walking. Dr. Stein was of the opinion that Ms. Fehringer required a progressive active exercise program to restore range of movement, strength and endurance, physiotherapy and chiropractic treatments and possibly psychological counselling.

On December 20, 1996, Dr. Chin recommended that Ms. Fehringer attend the gym to improve strength, tolerance and flexibility as a reasonable and necessary part of her rehabilitation, since she was still experiencing disabling symptoms from the accidents.

In January 1997, Ms. Fehringer began working part time for King Insurance Brokers, which was just starting up in the house of one of the owners, Pam King. Initially, Ms. Fehringer worked part-time as an assistant to the owner, filing and doing data entry between half a day to two half days per week for three hours. Later on, it became more of an administrative position in which she would run the office by the side of the owner. She could take breaks whenever she wanted, and had an hour for lunch. She testified that Ms. King was very generous in letting her leave early if she was not feeling well, and they always took Fridays off. Between January and March she worked between half a day to two and a half days a week. She then graduated to three and a half days six hours per week. The position grew to be a full-time position. She testified that when her employer needed her to come in on weekends, she was unable to do this and was fired in August 1997.

During February and March 1997, Ms. Fehringer also worked as a bartender one night a week for six weeks at Fassade. She had to take medication and found that this job involved too much standing, and therefore stopped working there.

In spring 1997, Ms. Fehringer had plastic surgery which was unrelated to either motor vehicle accident. In summer 1997, Ms. Fehringer began bartending as a shooter girl two nights per week at The Docks. She worked the 10:00 p.m. to 2:00 a.m. shift on Fridays and Saturdays. Although the club was open Tuesday to Saturday, the big nights were Friday and Saturday. In those two nights she was able to equal what she earned at the insurance brokerage.

In June 1997, Ms. Fehringer was discharged from Dufferin Mall Rehabilitation with a home program, having returned to two jobs, presumably at King Insurance Brokers and at The Docks. The clinical co-ordinator at Dufferin Mall Rehabilitation noted that she was able to work out five times a week without symptoms. On reassessment, she was found to have a full pain-free range of motion in all affected areas, full strength and no palpable tenderness. Her only reported complaint was some fatigue after exercise. Ms. Fehringer testified that she did not recall feeling this way in June 1997.

In September 1997, she returned for further treatment from Dr. Veiledal, chiropractor. He reported that after her discharge, she developed symptoms such as numbness in the toes of her right foot, headaches, left buttock and interscapular pain with referral into her upper limbs bilaterally. She had four treatments which alleviated her symptoms. He recommended that she receive supportive care two to four times per month as an adjunct to a regular fitness program of cardiovascular conditioning, strength training and stretching.

In October 1997, Ms. Fehringer began working for a temporary agency and was placed at Watson Wyatt Worldwide where she worked two days per week for one consultant. In February 1998, she was offered a full-time position at Watson Wyatt Worldwide, working five days a week. The remuneration at this job included health benefits. Because of her back pain, Ms. Fehringer began attending massage and chiropractic treatments three times a week. Ms. Fehringer testified that the treatment enabled her to work a five-day week. Depending on how much work she had and her stress levels, the treatments reduced the intensity of her pain for between 12 and 24 hours. Her benefit plan paid for 80% of her therapy; she paid the remaining 20% from her own pocket. She testified that she attended treatment before work, after work and during lunch and on sick days. She also testified that she exhausted her sick days so she could leave early on some Fridays to do bikini modelling for two hours. Her boyfriend, Dave Bellemare, testified that during that time she was not a "model" employee at Watson Wyatt Worldwide, and was frequently late and tired. Ms. Fehringer testified that she had several warnings and was ultimately fired from Watson Wyatt Worldwide in January 1999, because of the amount of time away from work.

Ms. Fehringer's T4 for 1997 shows that she earned income at Benix Housewares. I find it likely that she worked there as a cashier until 1997. She testified that in 1998 the amounts shown on her T4 from Benix reflected vacation pay.

In January 1998, Ms. Fehringer experienced severe depression and began to get anxiety attacks. She complained to her family doctor of blackout spells, poor memory, lack of concentration, inability to sleep, headaches, irritability and feeling stressed out. By this point she had been in pain 33 months. Dr. Chin referred her to a psychologist, Dr. G. Young, for psychotherapy.

Ms. Fehringer also complained to Dr. Chin that her neck ached constantly, and that she had pain between her shoulder blades. Her pain was worse if she did the dishes, peeled potatoes or if she had to keep her arm up for any length of time. Her low back was painful. Her pain went into her right and left buttocks region, radiated down her legs and into her tail bone. Her tail bone hurt if she sat too long. Her pelvis and low back were painful with standing and walking. She experienced severe back pain if she tried to bend, climb stairs, sit on a bicycle seat or use the treadmill. Her legs went numb when she sat on bicycle seat, or used the steps for four minutes. At night, her leg muscles attempt to cramp and pull up. Because of the exacerbation of her physical symptoms, Dr. Chin referred Ms. Fehringer to Dr. J.M. Kwok, orthopaedic surgeon.

In February 1998, Ms. Fehringer saw Dr. J.M. Kwok, orthopaedic surgeon. He found she was tender in her cervical spine midline and paraspinal areas, and in her left and right suprascapular areas. She had a full range of movement in her cervical spine and was tender in her upper and low back. He reported that from an orthopaedic point of view there was "nothing surgical here." In his opinion there was no contraindication for her to return to her pre-accident activities and perform a home exercise program. He noted that she had returned to her administrative job, was unable to work as a part-time model, part time at the salon and as a sales associate in a housewares store. The last paragraph of his report to Dr. Chin states, "I understand from her that the CT scan demonstrated 'narrowing of the canal' and also 'bulging of discs.' If there is a surgical lesion, please let me know."

In March 1998, Ms. Fehringer had laparoscopic surgery which was unrelated to her injuries. She returned to work at Watson Wyatt Worldwide in approximately mid-April 1998. Dr. Chin is of the opinion that Ms. Fehringer's depression and anxiety are unrelated to either of her surgeries and that they result from the motor vehicle accidents. I accept his opinion.

Zurich submitted that an incident in the summer of 1997 may have caused or contributed to Ms. Fehringer's depression and anxiety. That summer, Ms. Fehringer did some modelling for The Toronto Sun as a Sunshine Girl. Sunshine Girls are not paid for this work. Ms. Fehringer complained of sexual harassment following an incident with the photographer on June 16, 1997. As a result, the photographer in question no longer works at The Toronto Sun and that newspaper now has a female chaperone on such photo shoots. Following her complaint, other models came forward with complaints going back 20 to 30 years. Ms. Fehringer appeared pleased that her actions had put an end to a situation which had gone on for some time. She is the representative plaintiff in a class action against The Toronto Sun and the photographer. She appears to have taken a principled approach to righting a wrong, and I find it unlikely that this incident contributed to her anxiety and depression diagnosed in January 1998, as submitted by Zurich.

In May 1998, Ms. Fehringer was assessed by Dr. D. Dos Santos, chiropractor, as part of a medical/rehabilitation DAC. She complained of headaches, mid back pain and low back pain shooting in the right foot with the foot going to sleep, and her leg pain then becomes gnawing. The discomfort in her right leg was worse than in the left. It was reported that she works out two to three times per week which she found helpful. In Dr. Dos Santos' opinion, Ms. Fehringer had mild physical impairments relating to her neck and low back, and the examination was complicated by the presence of over reaction to mild palpation." Ms. Fehringer testified that her back was feeling bruised at the time. A few weeks later, in June 1998, the notes and records of Greg Stewart, massage therapist, reflect her symptoms as "back is sensitive to touch-feels bruised."

Dr. Dos Santos stated that, "Examination findings at this time could not objectively account for the claimant's reports of bilateral upper and lower limb symptoms. These appear to be more related to non-organic factors than any underlying organic lesion." Dr. H. Jacobs, a physician whose practice involves the treatment of chronic pain of the spine, head, neck and facial regions, opined that Ms. Fehringer exhibits typical organic signs of a lumbar disc lesion causing a pattern of referred pain; not pain behaviour. He questioned whether Dr. Dos Santos understood the possible causes of these symptoms and their significance from a medical perspective.

In Dr. Jacobs' opinion, Ms. Fehringer sustained severe injuries to her occipital region resulting in bilateral occipital neuralgia, a severe condition which can cause ongoing pain related to physical activities. In his opinion, Ms. Fehringer had a herniated disc as well as an injury to her zygapophyseal joints. Both are pain sensitive structures. In his opinion, when damage occurs, as it has with Ms. Fehringer, these structures will be the source of ongoing chronic pain. In Dr. Jacobs' opinion, Ms. Fehringer fits the diagnostic criteria for bilateral occipital neuralgia; probable lumbar spine zygapophyseal joint pain, secondary to trauma; possible lumbar discogenic pain, secondary to trauma; as well as pain disorder associated with a medical condition.

Ms. Fehringer testified that during 1998 her modelling sessions were between one to four hours in length. She estimated that she was taking between 20 and 25% of the jobs which came her way, either because she was in pain, or had a full-time job. Ms. Fehringer's boyfriend, Mr. Bellemare, testified that he definitely recalls her turning work down in summer 1998. Ms. Fehringer testified she did some camera work for calendars, sportswear catalogues, advertisements for various supplements, and some bikini contests. She was unable to wear high heeled shoes for more than one or two hours, because her feet went numb.

In February 1998, Ms. Fehringer saw Dr. G. Young, psychologist. She complained that she had been injured in two motor vehicle accidents and, as a result, her life has been upside down physically, mentally and financially. In Dr. Young's opinion, therapy was urgently needed. Dr. Young provided Ms. Fehringer with stress and pain management and relaxation strategies.

In June 1998, Ms. Fehringer was assessed by Dr. A. Kaminska, psychologist, as part of a medical/rehabilitation DAC to assess whether the psychological treatment provided by Dr. Young was reasonable and necessary. Dr. Kaminska was also asked to opine on the need for any further therapy. In Dr. Kaminska's opinion, Ms. Fehringer experienced significant disruption in her overall functioning, particularly following the second accident, due to persistent pain, loss of employment, disrupted personal relationships and difficulty in coping emotionally. In her opinion, the acute issues had been addressed by Dr. Young; however, Ms. Fehringer was emotionally vulnerable and might be prone to develop depressive symptomatology under stress. In her opinion, the psychological treatment recommended by Dr. Chin and Dr. Young was reasonable and necessary. Dr. Kaminska also recommended that Ms. Fehringer continue to receive two to three months of weekly sessions with Dr. Young.

Dr. Young is of the opinion that Ms. Fehringer meets the DSM-IV criteria of chronic adjustment disorder, with mixed anxiety and depressed mood, and experiences features of chronic pain syndrome. Her pain experience is pervasive and persistent and reflects the interplay of psychological and physical factors. In his opinion, in September 1998, Ms. Fehringer has a genuine psychological disorder which he attributed to her post-accident problems. In his opinion, her residual psychological impairments can be considered partially disabling, especially those relating to her pain experience and mood. I accept Ms. Fehringer's evidence that she has headaches virtually daily. Her neck pain, headaches and stress contribute to her depression. I accept her testimony that she still gets depressed a lot, has nightmares, and no longer engages in the sort of social and recreational activities she did in January 1996.

Dr. Chin reported that he would defer to Dr. Young with respect to Ms. Fehringer's psychological prognosis. In Dr. Chin's opinion, Ms. Fehringer will be left with some chronic pain mainly in the low back area which will cause some partial permanent disability.

In September 1998, Dr. Ogilvie-Harris examined Ms. Fehringer at the request of her counsel. In his opinion, she sustained significant soft tissue contusions as a result of the two accidents. In his opinion, her pre-existing spinal stenosis and degenerative changes in her facet joints pre-existed both accidents but were asymptomatic. He noted that many people have such changes without significant symptoms. In his opinion, in the absence of the motor vehicle accidents, the degenerative changes would probably not have caused her significant problems. However, once they become painful, especially following trauma, the symptoms usually persist. Further, recent studies have indicated that where there are pre-existing degenerative changes, patients often continue to have pain on a long-term basis. This was of particular concern to Dr. Ogilvie-Harris because of Ms. Fehringer's relatively young age. Further, studies from the Quebec Task Force also indicate that where patients sustain a second injury, while recovering from a first injury, the prognosis is poorer. Symptoms tend to persist longer and disability is greater.

Dr. Ogilvie-Harris was especially concerned about the persistent loss of range of movement in Ms. Fehringer's lumbar spine. He noted that this has consistently been reported by all examiners who have actually measured her range of movement, and is consistent with the underlying degenerative changes having been aggravated by the motor vehicle accidents. In his opinion, it is also consistent with the disc herniation shown on the CT-Scan. In Dr. Ogilvie-Harris' opinion, Ms. Fehringer's injuries constitute a serious impairment of important physical functions. The impairment is serious because it will limit her activities which involve repetitive bending or lifting, or prolonged standing, in her domestic, work, social and recreational spheres. It will also affect her competitiveness in any job with these requirements, and her ability to do jobs which are physically demanding, particularly those which are demanding on the lumbar spine. In his opinion, there was objective evidence of significant impairment, which will be an ongoing source of pain suffering and limitation of function with the ongoing prospect of deterioration in the future, rather than improvement. I accept Dr. Ogilvie-Harris' opinion.

I also accept Dr. Ogilvie-Harris' opinion that Ms. Fehringer sustained a herniated disc in her low back in the second motor vehicle accident, and her symptoms and complaints are consistent with this injury.

Conclusion on disability

The question I must decide is whether at the 104-week mark after the second accident, which the parties agree was in July 1998, Ms. Fehringer was substantially unable to perform the essential tasks of her employment in January 1996.

Zurich submits in March 1998 through July 1998, Ms. Fehringer did bartending work, held an administrative position and she modelled part-time, and was doing substantially what she was doing in January 1996. I disagree. I reject the submission that Ms. Fehringer tended bar in January 1996. I accept her testimony that she stopped tending bar at Shock in November 1995.

Between January 1996 and December 1997 when she settled her claim for IRBs, a period just shy of two years, Ms. Fehringer received one cheque for income replacement benefits in the amount of $208.91 from Zurich. Ms. Fehringer testified that she experienced financial difficulty and attempted to do whatever work she could to support herself. I accept that she did so. This is consistent with her attachment to the work force. Ms. Fehringer began working at 16 years of age to supplement her mother's income when her mother became disabled. Ms. Fehringer continued to attend high school, maintained an A average, and cared for her disabled mother with the assistance of her younger sister.

I find that on her own initiative, Ms. Fehringer tried to return to the jobs she was performing in January 1996, and was unable to do so. She then worked at jobs which were less onerous, yet continued to experience difficulty because of her accident-related impairments. In Foden v. Co-operators Ins. Assn. (1978), 1978 CanLII 1622 (ON HCJ), 20 OR (2d) 728 (HCJ), Justice Reid stated, "No one, in my opinion, should be discouraged from attempting to take up their former work, or any work, out of fear that the attempt might be held against him. Far from necessarily proving that an insured has the capacity to perform his task it may, as in my opinion it does here, prove the reverse. There is no better evidence of incapacity to perform a task than the failure of an honest and sustained attempt to do it." I agree with these comments.

I find Ms. Fehringer was unable to perform her job as office manager at Salon Venere. The administrative jobs Ms. Fehringer obtained at King Insurance Brokers and at Watson Wyatt Worldwide both involved part-time work which evolved into full-time work. Ms. Fehringer was fired from both jobs. I am not persuaded that a person who is fired because she is unable to meet the demands of a job can be said to be capable of doing those jobs. While both jobs involved repetitive sitting, neither appears to have involved sitting and twisting as did her job at Salon Venere. That requirement would put even further demands on her low back. I also find no evidence that Ms. Fehringer would be capable of lifting 70 pounds even on an infrequent basis. I find no evidence that Ms. Fehringer is able to meet the standing and lifting requirements of the sales associate job at Benix in July 1998. That job is strenuous. The preponderance of the medical evidence is that in July 1998, Ms. Fehringer was substantially unable to perform her essential tasks of her January 1996 jobs at Benix and at Salon Venere. I find the Applicant's evidence about her inability to work as a sales associate and office manager, based on her experience of attempting to work, more persuasive than the evidence offered by the Insurer. I find that in July 1998, she was substantially disabled from doing the essential tasks of her January 1996 jobs at Benix and Salon Venere.

The more difficult question is whether Ms. Fehringer is substantially disabled from performing her essential tasks as a part-time model. Ms. Fehringer testified that she has done more modelling post-accident than pre-accident. When she comes back from modelling she is exhausted after a 6-12 hour session and unable to do anything for the next day or two. She acknowledges that her photo shoots are longer hours than she used to do and are better paying. She presently turns down trade shows due to the standing requirements and fashion modelling because she is required to hold stances for a long time.

She testified she is barely able to do fitness modelling because she cannot exercise sufficiently to maintain her physique at the required standard. She has done bikini contests. There have been instances where she has been available on evenings and weekends and has had to turn jobs down. Ms. Fehringer estimates that she could be employed full time as a model, given all the work which is available to her. However, she works an average of two days per week. Frequently, following her sessions, she is very fatigued and withdraws to recuperate for a day or two. Her complaint is that as a result of her injuries, she is unable to do as much work as is available to her, and is not as reliable a model as she was in January 1996. She estimates that her working capacity is between 40-50% of what she used to be able to do. Although her modelling career has progressed to include infomercials, hosting a TV show, etc., the Schedule requires me to decide whether Ms. Fehringer is substantially disabled from performing the part-time modelling she did at the time of the accident.

I find that in July 1998, Ms. Fehringer would be able to stand three hours a day, twice a week, given that she was able to stand as a bartender at The Docks two days a week, four hours a day, in the summer of 1998. I also find that she would be able to sit for a similar length of time if she were doing signings, based on her part-time work at the insurance brokerage, and her part-time work at Watson Wyatt Worldwide. I find that she could maintain poses of various types during a three-hour period. However, I find she could not meet the requirement of wearing high heels while standing or while spokesmodelling for Budweiser. I also find she would have difficulty shaving her legs on most occasions. Given her difficulties in riding the GO Train to work from Brampton to Toronto, I doubt she could tolerate the jostling involved in riding on the bus from Toronto to the U.S.A. while taking care of contest winners.

My concern is that the evidence of which type of modelling she was doing in January 1996, at the time of the first accident, is sketchy. The precise details of how much time Ms. Fehringer was spending doing which types of modelling at the time of the first accident are meagre, except that she was primarily involved in spokesmodelling for Budweiser at the time of the first accident. Even within the spokesmodelling function, I do not have evidence of whether she was primarily doing signings, which I find she could do, or whether she was primarily standing and selling beer. Ms. Fehringer bears the burden of proof on this issue. Because of a lack of this type of evidence, I am unable to determine whether in 1998, Ms. Fehringer was substantially disabled from the type of modelling she performed in January 1996.

For these reasons I conclude that at the 104-week mark, Ms. Fehringer was entitled to an offer in respect of LECBs in relation to her work at Salon Venere and Benix, two of her three jobs.

The Schedule obliges an insurer to make an offer "promptly." In my view, the length of time involved may vary depending on the circumstances of a case. In this case, the parties settled Ms. Fehringer's claims for IRBs before she clarified whether she designated the 52 or 156 week pre-accident period for the calculation of her IRB, and before she provided full information to Zurich of her earnings in that period. I find that Zurich would have needed approximately four weeks from July 10, 1998 to obtain and assess further information from Ms. Fehringer of this nature in order to make a bona fide offer of a loss of earning capacity benefit which complied with the Schedule. I conclude that in the circumstances of this case, Zurich was obliged to make Ms. Fehringer an offer in respect of a loss of earning capacity benefit by August 10, 1998.

The claim for housekeeping and attendant care

Ms. Fehringer claims $200 per month for housekeeping and attendant care services rendered by her boyfriend, Dave Bellemare, between August 1997 and the date of the hearing. Zurich submits there is no basis for such an award.

In August 1997, Ms. Fehringer and Mr. Bellemare began living together in a two-bedroom apartment. They arranged to split the rent of $1,300 per month, and that Mr. Bellemare would pay $200 less per month to compensate him for housekeeping and homemaking services and attendant care. Based on Ms. Fehringer's and Mr. Bellemare's testimony I accept that this was their arrangement, that Mr. Bellemare provided the services claimed and was compensated by a reduction in the rent.

Mr. Bellemare does the housekeeping. Both he and Ms. Fehringer like a clean house. He does the cooking, cleaning, picking up, and errands when she needs photographs dropped off or picked up. Once or twice a week he will clean her car as well as his. He does all the shopping for toiletries. He also provides Ms. Fehringer with assistance getting in and out of the bathtub or getting out of bed when she needs it. Mr. Bellemare testified that Ms. Fehringer will try to do stuff around the house but will be sore. She gets upset because he does too much. He testified that he does as much as he does because he sees the effect on Ms. Fehringer when she does too much. If she were to do this work, it cuts into her ability to work and limits her career.

In the opinion of Dr. Ogilvie-Harris, Ms. Fehringer "will benefit from ongoing household help. She will need help with heavier physical activities such as spring and fall cleaning, heavy household maintenance activities." I accept his opinion.

Under section 47(1)(a) of the Schedule, if an insured person sustains an impairment as a result of an accident, the insurer shall pay for all reasonable expenses incurred by or on behalf of the insured person as a result of the accident for services provided by an aide or attendant. I find the services claimed as attendant care: grooming, dressing, laundry, meal preparation, washing dishes, assistance getting into and out of the bathtub, are appropriately claimed as attendant care benefits.

Section 55 of the Schedule governs the payment of housekeeping and home maintenance services and provides:

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

I find the benefits claimed for vacuuming, mopping floors, bathroom cleaning, laundry and bed making, shopping for food and household essentials, are appropriately claimed as housekeeping and homemaking services.

The amount claimed of $200 per month is $46.15 per week. It is less than one hour of time er day paid at minimum wage. An occupational therapist assessed the cost of replacing Ms. Fehringer's housekeeping services alone as $50.93 per week. Attendant care services are to be calculated based on section 50(10) of the Schedule. As of January 1, 1994, the prescribed hourly rate for attendant care for routine personal care such as assistance in dressing and undressing, grooming was $8.75 per hour; and the rate for basic supervisory functions, such as cleaning the bathroom, changing bedding, was the minimum wage. The amount which the Applicant claims for the provision of all services by Mr. Bellemare is less than the amount assessed for replacing housekeeping services. On this basis, I find the entire amount claimed to cover housekeeping and attendant care services provided is reasonable.

The insured person may elect to have attendant care assessed by a DAC, or the insurer may require the insured person to be assessed by a DAC. Neither party appears to have requested an attendant care DAC in this case.

Zurich relies on a surveillance videotape of the Applicant taken in August 1999. I find the Applicant's activities on those two days do not involve repetitive bending or lifting. She is standing for much of the videos, however she does not do so for longer than she says she is capable of doing, or that I have concluded she is capable of doing. I also accept that Ms. Fehringer has both good and bad days and that her level of activity varies as described by Mr. Bellemare.

I find that Ms. Fehringer has established that she sustained impairments particularly to her low back as a result of these motor vehicle accidents. In January 1996, Ms. Fehringer appears to have been both living with her former fiance and assisting her sister in caring for their mother who became disabled in 1990. I find no evidence that Ms. Fehringer incurred housekeeping and home maintenance services in January 1996. The expense claimed is therefore additional. I find the expense is reasonably incurred as a result of the accidents. I also accept Ms. Fehringer's and Mr. Bellemare's evidence that her capacity to be gainfully employed would be further reduced if she were to perform these activities. I accept their evidence as to the financial exchange they have reached, and find the approach she and Mr. Bellemare have taken to the provision of these services reasonable. I conclude that Ms. Fehringer has established her entitlement to the housekeeping expenses and attendant care which she claims. Given that the exchange between Ms. Fehringer and Mr. Bellemare takes place at the beginning of each month, and that this service is of an ongoing nature, I find Zurich is required to pay Ms. Fehringer for 37 months claimed at the rate of $200 per month, or $7,400.

The claim for supplementary medical expenses

Massage therapy & chiropractic treatments

Ms. Fehringer claims expenses incurred for massage therapy and chiropractic treatment in 1998 and 1999. During 1998, Watson Wyatt Worldwide reimbursed Ms. Fehringer for 80% of the treatment costs she submitted to them. She claims the remainder of her treatment costs incurred from Zurich. The parties agreed that the total amount for both years, in the receipts submitted, is $991.49. She also seeks payment for ongoing chiropractic treatment twice per week and ongoing massage treatment once per week from February 1999. She seeks this treatment to provide her with relief from her post-accident pain.

Zurich disputes that these treatments are reasonable or necessary and relies on the opinion of a medical/rehabilitation DAC conducted in May 1998. That assessment was conducted by Dr. D. Dos Santos, chiropractor. Dr. Dos Santos reported that he found Ms. Fehringer had mild physical impairments relating to her neck and low back. In his opinion, "At this time, given the extensive treatment that she has undergone, it is my opinion that she will not obtain substantial benefit from another course of treatment. While she may continue to complain of persisting neck and low back symptoms, the ongoing formal treatments will likely provide only palliative relief to her at this juncture."

In Dr. Dos Santos' opinion, "the examination was not consistent with any myofascial pain syndrome to warrant further massage therapy.... At this time Ms. Fehringer could likely obtain similar benefit as from formal treatments by continuing with the self-directed exercise program that she has been doing. It would be reasonable at this point given the fact that she has not had review of these exercises for a period of time, for her to undergo two to three sessions with a qualified professional (e g. physiotherapist, kinesiologist, chiropractor) to review these self-directed exercises and ensure that they are appropriate for her."

Commission adjudicators and judges have repeatedly held that the provision of relief from pain is a valid medical and rehabilitative goal. Dr. Dos Santos' opinion that palliative relief is not a valid basis for recommending treatment, may be a philosophical difference. However, it is at odds with the decisions of this Commission with respect to whether such treatment is reasonable.

Dr. Ogilvie-Harris, orthopaedic surgeon, was also of the opinion that Ms. Fehringer did not require ongoing passive modalities of treatment. In his opinion, she requires an ongoing supervised exercise program which focusses particularly on pelvic stabilization, lumbar spine strengthening and cervical spine strengthening on an indefinite basis. Ms. Fehringer has pursued this recommendation, and I accept that engaging in such a program will maintain and perhaps improve her function.

Dr. T.B. Veiledal, a chiropractor who had treated Ms. Fehringer, recommended that she receive supportive care of two to four treatments per month to obtain relief from symptoms which may occur from time to time. In his opinion, these treatments should only be an adjunct to a regular fitness program.

Dr. Jacobs reported, "It is reasonable in my opinion that this lady should be given any treatment that alleviates her suffering and provides her with an increase in function even if it is necessary on an ongoing basis."

However, I do not view the "active" treatment and "passive" treatment approaches as being mutually exclusive. In my view, there is no reason that Ms. Fehringer cannot do both an exercise program and obtain relief from pain in forms other than medication. Ms. Fehringer has found the combination of chiropractic and massage treatment helpful in maintaining function and her ability to work. I accept her testimony that when she stops treatment she experiences an exacerbation of her pain levels. Her pain then gets worse, before it gets better. Mr. Bellemare testified when Ms. Fehringer has chiropractic and massage treatments, she is much better able to do her routine and reduce the amount of medication she takes.

In this case, I have concluded that Ms. Fehringer was sincerely motivated to return to her pre-accident activities, including work. I have accepted Ms. Fehringer's testimony that she needed and needs such treatment to provide her with pain relief on an ongoing basis, otherwise, when treatment commences after a pain flare-up, her pain becomes worse before it gets better. At times her strategy appears to have been to get off medication; however, there are also other times when she relies on medication simply to get through a shoot. Mr. Bellemare testified that the amount of medication Ms. Fehringer takes for pain relief is one thing they argue about. I find it persuasive that Ms. Fehringer has been paying for the treatment out of her own pocket, although she is unable to afford to pay for that treatment as frequently as recommended. For these reasons I find Ms. Fehringer is entitled to payment of the chiropractic and massage therapy expenses which she incurred in 1998 and 1999 in the amount of $991.49.

Ms. Fehringer also claims entitlement to such treatment on an ongoing basis, to prevent and treat exacerbations of her injuries, as set out in treatment plans prepared by Dr. McBean, chiropractor, and Greg Stewart, massage therapist, both of the Dundas University Chiropractic Clinic, in January 1999. According to the treatment plans, massage therapy was recommended at a frequency of once per week, at the rate of $65 per week, on an indefinite basis. The chiropractic treatment was recommended at a frequency of once or twice per week as supportive care, for symptom relief and to decrease pain, at a rate of $25 per treatment. Both practitioners indicate that it was impossible to estimate the duration of the plan given Ms. Fehringer's history of acute flare-ups. The anticipated benefits were to provide symptomatic relief, decrease pain, increase range of motion of spinal joints, decrease spasm, radicular pain, headaches and inflammation.

On January 29, 1999, Zurich wrote Dr. McBean that Ms. Fehringer had been assessed at a medical/rehabilitation DAC assessment in May 1998, and it "was determined that no further treatments such as chiropractic care and massage therapy are warranted." Zurich therefore denied further treatment on the basis of the earlier DAC assessment. The Schedule contemplates the assessment of a treatment plan by a DAC after it has been prepared and submitted. The 1999 treatment plans in issue in this arbitration did not exist at the time of the 1998 DAC. I appreciate that these claims were of a similar nature to those for which Zurich sought an opinion a year earlier at the medical/rehabilitation DAC. However, under this Schedule, Ms. Fehringer has lifetime entitlement to supplementary medical and rehabilitation benefits. Treatment and rehabilitation needs which result from accidents may arise at any point. While causation issues may be raised in some cases, there may be cases of pain flares-ups, relapses, exacerbation of the injury, etc. during the period over which the benefit is payable. From a practical point of view, approximately eight months had elapsed since the date of the last DAC assessment, and I find that a further assessment was warranted.

In Pintucci and Jevco Insurance Company (FSCO A97-000755 January 7, 1999), Arbitrator Palmer outlined the process under the Schedule relating to supplementary medical benefits and rehabilitation benefits. She stated:

An insurer may require a person claiming payment of an expense to furnish a certificate from a health practitioner stating that the expense is reasonable and is necessary for the person's treatment. If the expense is a continuing one, the insurer may require a certificate "as often as reasonably necessary." If the insurer receives a certificate and does not accept it at face value, it may give the insured person a notice requiring him to be assessed. Subject to certain other provisions that do not pertain here, section 36(4) mandates that "the insurer shall pay an expense under subsection (1) pending resolution of a dispute relating to the expense in accordance with sections 279 to 283 of the Insurance Act." These are the standard procedures to be followed for supplementary medical expense claims.

I agree with Arbitrator Palmer's analysis. I find that Zurich failed to pay the massage and chiropractic expenses pending resolution of the dispute as it was required to under the provisions of the Schedule. I find that Zurich failed to comply with the denial provisions and the process provided in the Schedule for resolving disputes concerning supplementary medical and rehabilitation benefits.

Arbitrators have considered what consequences should flow from the failure to comply with the denial provisions of the Schedule in relation to medical and rehabilitation benefits. In Pintucci, Arbitrator Palmer concluded that although Mr. Pintucci had not established his ongoing treatment was related to the accident, Jevco was required to pay for the treatment obtained prior to a medical and rehabilitation DAC report. This was because Jevco failed to comply with the mandatory procedural provisions of the Schedule. Arbitrator Palmer concluded that this result was appropriate for social policy reasons, in the interest of avoiding an unjust or unreasonable result, and was "an essential part of the court's task in interpreting statutory language."⁸She stated:

It is important to the integrity of the operation of the Schedule that the parties comply with its terms. Prompt, continuing access to reasonable and necessary treatment, even while a dispute is underway, is a hallmark of the system. The initial gatekeepers of the treatment system are treating health practitioners, who are regulated health professionals, and the designated assessment centres As Justice Catzman of the Court of Appeal noted in a recent decision, "Part VI of the Insurance Act represents the expression of a social policy adopted by the Legislature of this province to deal with automobile insurance." [In Morton v. Rabito, 1998 CanLII 5865 (ON CA), [1998] O.J. No. 5129, December 10, 1998] Insurers cannot flout the terms relating to the provision of and payment for supplementary medical and rehabilitation benefits and substitute in their stead adjustment procedures that they find more convenient or suitable to their purpose...

In my view the social policy considerations in a case where supplementary medical payments were terminated, without even an attempt at compliance with the Schedule’s process, mandate that Jevco be ordered to pay these expenses even though Mr. Pintucci’s substantive entitlement to the treatment has not been proved....in the face of Jevco's noncompliance with the Schedule" it would not be a "reasonable and just outcome" if the applicant was "responsible for the cost of treatment he pursued in good faith at the recommendation of his doctor and chiro-practor, yet which, ultimately, he has not proven was necessitated by the accident.

Arbitrator Palmer also ordered the insurer to pay a special award in the amount of 25%. I agree with this approach.

Ms. Fehringer does not appear to have pursued the treatment at the frequency recommended by the chiropractor and the massage therapist. I find it likely that this was due to financial reasons, rather than because she was not experiencing pain. In Kennelly and Wawanesa Mutual Insurance Company (FSCO A99-000139, January 21, 2000), Arbitrator Baltman considered whether she should order an insurer to pay for speech therapy treatment which was recommended, but not pursued and which could no longer be provided. Wawanesa submitted that it should not be required to pay the cost of such treatment because it would unjustly enrich the Applicant. Arbitrator Baltman ordered payment of the benefits, reasoning that:

While at first glance there is some logic to this argument, if allowed it would undermine the statutory goal of prompt and timely payment for necessary medical services. Insurers might deny payment of needed services with impunity, believing that an arbitrator will not later order them to pay for the treatments, however reasonable, because they can no longer be of benefit to the applicant."Although an aggrieved applicant can recover a special award if the hearing arbitrator finds that an insurer unreasonably withheld benefits, this penultimate remedy cannot substitute for prompt, regular treatments during the period of entitlement.

I agree with Arbitrator Baltman’s reasons. I find Ms. Fehringer’s condition is chronic. Given her history of pain flare-ups, and her attempts to return to work, I find that Ms. Fehringer should also have chiropractic and massage treatment to relieve her symptoms and to maintain as much function as possible. For these reasons, I find Ms. Fehringer is entitled to payment of the treatment recommended in the January 1999 chiropractic and massage therapy treatment plans, although she does not appear to have pursued the recommended treatment. I find that Zurich should pay Ms. Fehringer for chiropractic treatments twice per week between February 1, 1999 and the conclusion of the hearing, a period of 84.5 weeks, at the rate of $50 per week, for a total or $4,225 for chiropractic treatment. I also find that Zurich should pay for massage therapy once per week at the rate of $65 per week during this period for a total of $5,492.50. From this sum, I deduct the amount of $70 paid for massage therapy, in May and June 1999, according to copies of receipts for massage therapy, because this sum was already included in the incurred expense amount of $991.49. Zurich is therefore obliged to pay Ms. Fehringer $10,638.99 for chiropractic and massage treatments claimed.

Transportation expenses

Ms. Fehringer claimed 4,097 kilometres as the total mileage for travel to various appointments. With the exception of 62 kilometres claimed for travel to see Dr. Digby, I accept the amount claimed. Ms. Fehringer did not recall seeing Dr. Digby, and I have no evidence that she saw him in relation to her treatment or at all. Ms. Fehringer testified that she drove to these appointments in her own vehicle and she claimed at the rate of 304 per kilometre — not 354 per kilometre as set out in Exhibit 9. Zurich submitted that 124 per kilometre was reasonable, based on CAA rates of between 114 to 134 per kilometre.

The Schedule limits compensation for travel expenses in respect of an insured person's automobile to amounts for fuel, oil, maintenance and tires. In Bajic and Zurich Insurance Company and Pafco Insurance Company Limited (FSCO A97-000572, July 5, 2000) in similar circumstances, I relied on the Transportation Expense Guidelines as a reasonable basis for determining such compensation.⁹ Although those Guidelines relate to a later Schedule, I also find that approach to be a reasonable one in this case and therefore allow 224 per kilometre for 4,035 kilometres or $887.70.

Ms. Fehringer also claimed parking charges in relation to her appointments for treatment. The parties agreed the parking charges claimed totalled $34.75. I accept that these charges were incurred by Ms. Fehringer in relation to such appointments and that they were reasonable. Zurich is also required to pay these amounts as transportation expenses. The total amount payable as transportation expenses is $922.45.

Supplements

Ms. Fehringer claimed payment of products she purchased from Nutrition House in the amount of $136.92. She testified that she tried these products to try to obtain pain relief. She was unable to remember the name of the product(s) and I have no evidence of the quantities she purchased or the period over which they were taken. Zurich submitted these products are experimental. I find that Ms. Fehringer has failed to discharge her burden of proof with respect to these supplements, and dismiss this claim.

Mattress box spring

Given Ms. Fehringer's back pain, and perhaps because of her insomnia, her family physician, Dr. Chin, recommended that she purchase an orthopaedic mattress. Ms. Fehringer purchased an orthopaedic mattress with the accompanying box spring. She testified that prior to these accidents, she slept on a futon, and therefore she also bought a box spring with the mattress and submitted the bills to Zurich for payment.

Zurich arranged a medical/rehabilitation DAC, and asked the DAC: "Is an orthopaedic mattress reasonable and necessary?" The DAC reported, "She had recently changed her mattress to a Sealy Posturepedic which has improved her sleeping patterns. ... it is my opinion that given the examination findings and the mild physical impairments, and taking into account the improved sleep reported by the claimant that the orthopaedic mattress is a reasonable expense in this case."

Zurich paid Ms. Fehringer for the cost of the mattress, but refused to pay the cost of the box spring in the amount of $276. Zurich submits that it paid what the DAC recommended. Ms. Fehringer claims the cost of the box spring.

I find that under the provisions of the Schedule, Zurich had three options when it received Ms. Fehringer’s claim for both a mattress and a box spring and a prescription for an orthopaedic mattress. It could have asked Ms. Fehringer to provide a note or recommendation from her doctor that the box spring was also needed. If not satisfied with the note, or none was forthcoming, it could ask a medical/rehabilitation DAC for an opinion as to whether both the box spring and mattress were reasonable and necessary, and abide by that opinion, pending resolution of the dispute, or it could pay for the mattress and box spring. While Zurich followed the provisions of the Schedule with respect to the mattress, and submitted that question to the DAC, it did not do so with respect to the box spring.

Further, once Zurich had the DAC’s report, that opinion was based on the mattress as it had been used, in combination with the box spring. The DAC found their combined use beneficial. I find that it is unduly narrow in these circumstances to read the report as recommending only the mattress, but not the box spring. Having been less clear than it ought to have been, Zurich cannot sit back and rely on its own failure to submit the question to a DAC. I find the expense was reasonable and necessary based on her lack of adequate bedding and her pain and sleep disturbance. I find the dollar amount claimed for the box spring modest and therefore reasonable. I find that Zurich unreasonably withheld this benefit.

Prescription drugs

Ms. Fehringer claimed reimbursement for various prescription expenses. During the hearing Zurich undertook to pay these expenses in the amount of $268.65, and they are no longer in dispute.

Interest

Ms. Fehringer is entitled to interest under section 68 of the Schedule.

Special Award

Ms. Fehringer claims a special award. The authority to order a special award is found at section 282(10) of the Insurance Act, which provides:

If the arbitrator finds that an insurer has unreasonably withheld or delayed payments, the arbitrator, in addition to awarding the benefits and interest to which an insured person is entitled under the Statutory Accident Benefits Schedule, shall award a lump sum of up to 50 per cent of the amount to which the person was entitled at the time of the award together with interest on all amounts then owing to the insured (including unpaid interest) at the rate of 2 per cent per month, compounded monthly, from the time the benefits first became payable under the Schedule.

I find that Ms. Fehringer is not entitled to a special award in relation to the LECB offer because there was some medical opinion evidence which supported Zurich’s position that Ms. Fehringer did not meet the disability test.

I find that in failing to follow the process and timelines of the Schedule in relation to Ms. Fehringer’s supplementary medical benefits of prescription expenses, the chiropractic and massage therapy recommended in the January 1999 treatment plans and the box spring, Zurich’s basis for withholding the payments was unreasonable. Zurich is required to pay a special award with respect to those benefits which I have found it unreasonably delayed or withheld. In light of Ms. Fehringer’s injuries, none of these claims appear to be unusual. A mitigating factor with respect to the prescription expenses was that Zurich undertook to pay them mid-hearing. Although Zurich did so, arbitrators have concluded that insurers cannot avoid a special award by paying benefits on the eve of or during the course of the hearing.¹⁰ I agree with those decisions.

I find it appropriate in all the circumstance of this case that Zurich should pay a special award of 15% in relation to the prescription expenses and 25% in relation to the mattress box spring, and the chiropractic and massage therapy treatments.

In the interests of clarity, I adopt the formulation of the manner in which the special award is calculated as stated by Arbitrator Makepeace in Graper and Liberty Mutual Fire Insurance Company (FSCO A00-000133, July 20, 2001). "Subsection 282(10) involves a three-step calculus: the amount of the benefits owing + simple interest at 2 percent per month + compound interest at 2 percent compounded monthly." The 15% and 25% amounts of the special award are then applied to the final result of the special award calculus. In the event that counsel are unable to agree on the amount of the special award, I remain seized of this issue.

EXPENSES:

If the parties are unable to agree on expenses, that issue may now be addressed

February 28, 2002

Suesan Alves Arbitrator

Date

Neutral Citation: 2002 ONFSCDRS 39

FSCO A99-000699

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

VANESSA FEHRINGER

Applicant

and

ZURICH 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. Zurich Insurance Company was obliged to make Ms. Fehringer an offer in respect of weekly loss of earning capacity benefits pursuant to section 20 of the Schedule by August 10, 1998.

2. Zurich Insurance Company shall pay Ms. Fehringer $10,638.99 for chiropractic treatment and massage therapy, $922.45 for transportation expenses, and $276 for a mattress box spring as supplementary medical expenses under section 36(1) of the Schedule. Ms. Fehringer’s claim for nutritional supplements is dismissed.

3. Zurich Insurance Company shall pay Ms. Fehringer $7,400 as reimbursement for services rendered as attendant care, housekeeping and home maintenance services between August 1997 and September 2000, at the rate of $200 per month, under sections 47 and 55 of the Schedule

4. Ms. Fehringer is entitled to interest on overdue benefits under section 68 of the Schedule.

5. Zurich Insurance Company shall pay Ms. Fehringer a special award of 15% on prescription expenses of $268.65, and 25% on the mattress box spring of $276 and chiropractic and massage therapy of $9,647.50, under section 282(10) of the Insurance Act. If the parties are unable to agree on the amount, I remain seized of this question.

6. If the parties are unable to agree on expenses, that issue may now be addressed.

February 28, 2002

Suesan Alves 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.
2. 2Reg. 664, R.R.O. 1990, as amended by O.Reg. 780/93, s.9.1 (2) requires insurers to provide a disclosure statement, with prescribed content prior to entering into a settlement with an insured person.
3. 3In the interests of clarity Ms. Fehringer wrote in the margin next to subparagraph II B. "THIS APPLIES ONLY TO INCOME REPLACEMENT BENEFITS," and initialled the addition. This supports Ms. Fehringer's submission that the parties agreed to settle her claims for income replacement benefits only, and not LECBs.
4. 4I was advised that the mandatory disclosure statement and the release were drafted by Zurich's former counsel, and that in December 1997, Ms. Fehringer was also represented by different counsel.
5. 5In this case, the parties agree that because of section 21(9) of the Schedule the operation of subsection (1) is delayed until 104 weeks after the later accident.
6. 6T4s for 1996 from Salon Venere and Benix. At the hearing, letters from MGS Promotions Unlimited, Loates Photo, Icon Models, and Porter Frames were filed as part of Exhibit 2. All letters support Ms. Fehringer's claim of modelling pre-accident. Although all are undated, each letter addresses the relevant time frames.
7. 7This analysis was done on January 30, 1996 by P.A.T.H. where Ms. Fehringer first attended physiotherapy.
8. 8Bapoo v. Co-operators General Insurance Company, (1997) 1997 CanLII 6320 (ON CA), 36 O.R. (3d) 616
9. 9Commissioner's Guideline No. 6/96, effective October 19, 1996. This guideline is issued pursuant to Section 268.3 of the Insurance Act and applies to accidents occurring on or after November 1, 1996.
10. 10See for example: Quarrington and Jevco Insurance Company (OIC No. A-010804, July 17, 1995)