Neutral Citation: 2004 ONFSCDRS 177

FSCO A02-001622

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

DANNY MCCOY Applicant

and

GORE MUTUAL INSURANCE COMPANY Insurer

DECISION ON A PRELIMINARY ISSUE

Before: Eban Bayefsky

Heard: October 7 and 8, 2003 and February 27, 2004, at the offices of the Financial Services Commission of Ontario in Toronto.

Appearances: L. Craig Brown for Mr. McCoy Lawrence M. Foy for Gore Mutual Insurance Company

The Applicant, Danny McCoy, was seriously injured in a motor vehicle accident on December 19, 1994. He applied for and received statutory accident benefits from Gore Mutual Insurance Company ("Gore Mutual"), payable under the Schedule.¹ Mr. McCoy executed Minutes of Settlement on September 3, 1996, concerning various issues in dispute. The parties disagree as to whether this settlement precludes Mr. McCoy from proceeding at this time to arbitration on the issue of attendant care benefits. The parties were unable to resolve their disputes through mediation, and Mr. McCoy applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The preliminary issue is:

Is Mr. McCoy precluded at this time from proceeding to arbitration on the issue of attendant care benefits?
Is either party entitled to their expenses of the preliminary issue hearing?

Mr. McCoy is precluded at this time from proceeding to arbitration on the issue of attendant care benefits.
If required, the parties may now make submissions on the issue of expenses.

Mr. McCoy was very seriously injured in a motor vehicle accident on December 19, 1994. He was rendered a paraplegic, losing the use of his legs, and suffering various other complications. Prior to the accident, Mr. McCoy was very active, owning and operating an auto collision repair shop, holding interests in various businesses, and participating in different sports, including sailing and skiing. Mr. McCoy had two places of residence before the accident, a house in Hamilton and one in Toronto.

Mr. McCoy testified that, after the accident, the only place for him to live was in a small van purchased by Gore Mutual which was adapted with a wheelchair lift, bed and hand controls. He relied on the assistance of others for his daily activities, including meal preparation and laundry. Mr. McCoy testified that, in the fall of 1997, his friends were concerned about his mental state and encouraged him to participate in sailing. He did so, initially as an observer and tactician, and then as a full-fledged sailor. He quickly advanced to competitive sailing, where he succeeded in a variety of races. He credited his return to competitive sailing as the means by which he coped with his disability and reintegrated into society. Racing sailboats became the driving force in Mr. McCoy's life. He became an outspoken advocate for disabled sailors and a leader in international competitive sailing for the disabled. He has travelled extensively, literally criss-crossing the globe, participating in sailing races and speaking on behalf of disabled sailors. In 2001, he qualified to represent Canada in the 2004 Para-Olympic Games in Athens.

Since the accident, Gore Mutual has covered various medical, rehabilitation, housing and weekly income benefits. On September 3, 1996, Mr. McCoy and Gore Mutual entered into an agreement regarding the payment of certain outstanding benefits. The relevant portions of the Minutes of Settlement are as follows:

Gore Mutual will pay $250,000 immediately in satisfaction of all claims for housing modifications and housing related items under ss. 40 and 41 of the SABS and a further $7,200 immediately in satisfaction of all future claims for home maintenance services only under s. 55 of the SABS. The claimant will deliver a full and final release in respect of these future claims on receipt of settlement funds.
The parties agree that attendant care expense as set out in the CPA [Canadian Paraplegic Association] DAC assessment ($360.58) will be paid from June 1, 1996 until a further DAC is completed. This further DAC will be scheduled as soon as Dan McCoy moves into permanent housing accommodation.
The parties agree that Gore Mutual will pay an additional $7,500 for claims relating to McCoy's 1995 GMC van.

Prior to this agreement, Gore Mutual had been paying Mr. McCoy income replacement benefits ("IRBs") at a rate of $441.50 per week. Roughly a month following the agreement, Gore Mutual notified Mr. McCoy that it was reducing his IRBs to $202.98 per week on the basis that Mr. McCoy had failed to co-operate in treatment or rehabilitation, as required by the Statutory Accident Benefits Schedule. In December 1996, Gore Mutual determined that Mr. McCoy was capable of returning to certain employment and that his loss of earning capacity benefit ("LECB") entitlement was zero. In February 1997, Gore Mutual suspended Mr. McCoy's LECBs and IRBs on the basis that Mr. McCoy had not made himself available for a vocational assessment. In September 1997, Gore Mutual re-evaluated Mr. McCoy's entitlement to LECBs, and began to pay him at a rate of $98.82 per week. In June 2001, the parties settled Mr. McCoy's weekly income claims, which involved paying Mr. McCoy the principal sum of $550,000.

In December 2001, Mr. McCoy submitted a request for attendant care benefits on the basis of a November 2001 Future Needs Report by Dianne Taylor, a physiotherapist. Ms. Taylor recommended that attendant care benefits be paid at a rate of $5,056.80 per month. Gore Mutual did not pay benefits in accordance with this report, and did not proceed to a DAC assessment. This issue proceeded to mediation and ultimately to arbitration. In October 2002, Gore Mutual formally stated its position that, pursuant to the settlement executed by Mr. McCoy in September 1996, the amount of attendant care benefits would be that set out in the Minutes of Settlement until a further attendant care DAC had been conducted, and that the new DAC would only occur once Mr. McCoy had moved into permanent housing accommodation.

In my view, and based on the submissions of the parties, the question of whether the 1996 settlement precludes Mr. McCoy from arbitrating his entitlement to attendant care benefits involves three issues:

(1) whether Mr. McCoy has moved into permanent housing accommodation

(2) if the answer to (1) is yes, whether a DAC is required before he can arbitrate his entitlement to attendant care benefits

(3) if the answer to (1) is no, whether he must first move into permanent housing accommodation and then undergo a DAC before he can arbitrate his entitlement to attendant care benefits

(1) Has Mr. McCoy moved into permanent housing accommodation?

Mr. McCoy took two different positions on this issue, namely, that he has moved into permanent housing accommodation, and that he has been unable to move into permanent housing accommodation as a result of events subsequent to his entering into the 1996 settlement. I find that Mr. McCoy has not moved into permanent housing accommodation.

Black's Law Dictionary, Sixth Edition, defines "permanent" as "continuing or enduring in the same state, status, place, or the like, without fundamental or marked change, not subject to fluctuation, or alteration, fixed or intended to be fixed; lasting; abiding; stable; not temporary or transient." Mr. McCoy submitted that a distinction must be drawn between "permanent housing accommodation" and "fixed housing accommodation." Even accepting that "permanent" is not the same as "fixed," I find that Mr. McCoy's housing arrangements have varied widely since 1996 and have not constituted "permanent housing accommodation."

From 1996 to 2001, Mr. McCoy usually lived out of his van while travelling to various sailing events around the world. He would either drive to an event or ship his van to the relevant site and live out of it there. However, on a number of occasions, he stayed in various other types of accommodation when participating in sailing events. For example, when competing in Scandinavia in 1998 or 1999, he lived in hostels, school-houses and yacht-clubs. When in Australia and Sweden in 2000, he stayed in hotels and friends' houses. When sailing in the Netherlands in 2002, he stayed in hostels and hotels. In 2001, with the proceeds of a significant tort settlement in the United States, Mr. McCoy bought a recreational vehicle ("RV"). He testified that the van was too small for two people (namely, for himself and his girlfriend, whom he had met in 2000 and who had greatly assisted him in his daily activities and in his travelling and sailing commitments). However, despite purchasing and using the RV, he has continued to use his van to travel to various events. He stated that, as of 2002, the RV has remained in California, where he can use it when sailing and travelling in that part of the continent.

Given the significant variations in Mr. McCoy's accommodations since 1996, I find that he has not moved into permanent housing accommodation.

In my view, the nature of Mr. McCoy's housing arrangements following the 1996 settlement were central to the assessment of his attendant care needs. This flows from the agreement itself, which states that Mr. McCoy's needs would be reviewed by a DAC as soon as he moved into permanent housing accommodation. However, it also follows from Mr. McCoy's testimony at the hearing, in which he acknowledged that his attendant care needs vary depending on whether he resides in his van or his RV, and would change further if he were living in a house.

Mr. McCoy argued that, based on the Response to the Application for Arbitration, Gore Mutual has acknowledged that he has moved into permanent housing accommodation. In the Response, Gore Mutual stated that "the RV is effectively Mr. McCoy's home." However, that statement was made in respect of his claim for rehabilitation benefits under sections 40 and 42 of the Schedule and the Insurer also stated that "Mr. McCoy does not have a permanent residence" in respect of his claim for attendant care benefits. Further, Mr. McCoy testified that his van has effectively become his home, but then submitted that his RV is now his home. He also submitted that any assessment of his attendant care needs could be conducted in respect of either his van or his RV.

Given the fluctuating nature of Mr. McCoy's accommodations, and his own uncertainty as to what, if anything, constitutes his "home," I find that, for the purposes of the anticipated assessment of his attendant care needs, he has not moved into permanent housing accommodation.

(2) If Mr. McCoy has moved into permanent housing accommodation, must he first undergo a DAC assessment before he can arbitrate his entitlement to attendant care benefits?

Given my finding on the first issue, it is unnecessary to answer this question.

(3) Since Mr. McCoy has not moved into permanent housing accommodation, must he now do so and undergo a DAC assessment before he can arbitrate his entitlement to attendant care benefits?

I find that, in accordance with the settlement Mr. McCoy reached with Gore Mutual, in order to arbitrate his entitlement to attendant care benefits, he must move into permanent housing accommodation and undergo a DAC assessment.

I agree with Gore Mutual's position that the 1996 agreement envisaged that Mr. McCoy's attendant care benefits would not be the subject of review until a further DAC was completed and that the DAC would only take place once Mr. McCoy moved into permanent housing accommodation. Mr. McCoy did not dispute this understanding of the settlement. Instead, he maintained both that he has been unable to comply with the settlement and that Gore Mutual is no longer entitled to rely on the settlement, due to events subsequent to the agreement being entered into. I do not accept Mr. McCoy's position.

Mr. McCoy testified that, although he had intended to buy a condominium with the housing funds he received through the 1996 settlement, and although the DAC assessment was to take place once he had found a place to live, he could neither purchase nor rent permanent housing because Gore Mutual significantly reduced and then terminated his IRBs following the 1996 settlement. He testified that, between March and September 1997, Gore Mutual "forced him to live on nothing." However, Mr. McCoy also testified that, in March 1997, he invested approximately $100,000 in U.S. funds from the housing settlement in a "high-tech company" in California, which subsequently went bankrupt, causing him to lose his entire investment. He also testified that, while he had been greatly affected by Gore Mutual's decision to reduce his IRBs, he had barely been able to live on the initial level of IRBs ($440 per week), partly because the insurance payments on his van were so high. When asked whether he could have obtained permanent housing if he had not invested his settlement funds, Mr. McCoy simply said that he would not attempt to obtain permanent housing "if he did not know whether he could afford it."

Given his decision to invest roughly half of his 1996 settlement funds, and his apparent intention to use some of the remaining settlement funds to maintain his use of his van (despite his stated intention of using the settlement funds to purchase a condominium), I do not accept Mr. McCoy's contention that it was Gore Mutual's actions following the settlement that precluded him from purchasing or renting permanent housing. I find that Mr. McCoy made a conscious decision to direct the money he received from the 1996 settlement to his business investment and sailing activities.

However, even if Gore Mutual's actions initially rendered Mr. McCoy unable to move into permanent housing accommodation, I find that his situation changed significantly in 2001. At that time, the parties settled Mr. McCoy's IRB claim, where more than half a million dollars was put into a structured settlement, and which generated $3,500 per month tax free. He also received roughly $190,000 in U.S. funds from his tort litigation in the United States. Mr. McCoy testified that, out of these proceeds, he purchased his RV to continue his sailing and advocacy activities.

Mr. McCoy gave different answers to the question of whether, as of 2001, he was capable of moving into permanent housing accommodation within the meaning of the original settlement. He said that the Insurer had forced him into a situation where he could not move into fixed accommodation. He also said that he could not afford to move into permanent housing and pursue a sailing career. However, he also said that he has not even considered buying or renting permanent housing because he loves his new lifestyle and has chosen to live this way.

While Mr. McCoy clearly suffered as a result of the accident, and while he has very admirably and successfully pursued a career in competitive sailing and advocacy, I am unable to accept his contention that he was incapable of moving into permanent housing accommodation as originally envisaged in the 1996 settlement. In my respectful view, Mr. McCoy has voluntarily decided to pursue the path he has taken and has freely chosen not to move into permanent housing.

In light of the significant sums of money Mr. McCoy has received since 1996, his decision to direct a significant portion of that money to a business investment and his evidence that he has not even considered purchasing or renting permanent housing, I do not accept his contention that he has been unable to move into permanent housing accommodation. I note, as well, that despite his evidence that he was in a precarious financial position between 1996 and 2001, he was able to pursue a successful career in international sailing and advocacy. I, therefore, do not accept that, once he entered into the two significant settlements in 2001, he could not continue to pursue his sailing career and move into permanent housing. While Mr. McCoy may, in fact, have been saying that it would not make financial or practical sense to move into permanent housing while he was pursuing a sailing career, in my view, this does not amount to his being incapable of doing the former. He has made a conscious decision to follow a certain path, which involves a choice not to move into permanent housing.

I find it significant that Mr. McCoy has not intended to pursue his current lifestyle indefinitely. In the November 2001 Future Needs Report prepared by Ms. Taylor, Mr. McCoy stated that "after the Olympics in 2004 he will retire from racing" and that "five years from now he and Ms. Brittain [his girlfriend] will move into a two-bedroom apartment or condominium, probably in the Toronto area." At the hearing, Mr. McCoy testified that he intended to live in his van until the 2004 Olympics. Based on Ms. Taylor's comment that Mr. McCoy would "continue to require assistance when he travels to sailing clubs to promote programs and conduct clinics," he would likely continue to do some degree of travelling. However, based on Ms. Taylor's comment that, until the Olympics, Mr. McCoy would "be required to participate in approximately fifteen to twenty regattas each year," I find that he would no longer need to do the extensive travelling required in his previous training. This further suggests that Mr. McCoy has chosen to pursue goals which militated against his moving into permanent housing accommodation, and that he foresaw himself eventually changing his focus and seeking the type of accommodation originally contemplated in the 1996 settlement. In my view, therefore, Mr. McCoy has not been prevented from following the process envisaged in the initial agreement.

Mr. McCoy maintained that, due to events subsequent to the 1996 agreement, Gore Mutual is no longer entitled to rely on the settlement. This argument had five parts. First, Gore Mutual waived its right under the settlement to a DAC assessment of Mr. McCoy's attendant care needs because it conducted its own assessment of his needs despite the fact that he had not moved into permanent housing accommodation within the meaning of the settlement. Secondly, Gore Mutual delayed raising its objection to Mr. McCoy's arbitration of the issue of his entitlement to attendant care benefits. Thirdly, since the DAC process is statutorily mandated, the settlement cannot displace Mr. McCoy's right to be assessed based on his current living circumstances. Fourthly, the agreement was a final settlement and Gore Mutual failed to provide sufficient notice in accordance with the Settlement Regulation. Finally, as a matter of fairness, the settlement ought to be interpreted in Mr. McCoy's favour, allowing him to proceed to an arbitration of his entitlement to attendant care benefits.

(i) Whether Gore Mutual waived its right under the settlement to a DAC assessment

I do not accept that Gore Mutual waived its right to a DAC assessment under the settlement. In February 2000, while Mr. McCoy was living in his van, Gore Mutual conducted a future care cost assessment of Mr. McCoy's attendant care needs. The precise purpose the Insurer sought such a report is unclear. However, I heard no evidence to the effect that, in seeking an assessment of Mr. McCoy's future needs, Gore Mutual led Mr. McCoy to believe that it would not be relying on the process set out in the original settlement, or that Mr. McCoy relied on the Insurer's obtaining an assessment in a way that ought to preclude Gore Mutual from invoking the original settlement. In this regard, Mr. McCoy sought and obtained his own future needs report in November 2001, almost two years after the Insurer's assessment.

I also find that the assessment conducted by Gore Mutual was highly speculative in nature. The report noted that the "costing which has been outlined...assumes that Mr. McCoy would be living in an accessible accommodation....[and] that the residence will have covered parking with a direct link to his home and that parking will be accessible to his van." The report further stated that Mr. McCoy's "preferred living arrangement will be a house and a contingency of $3000.00 annually has been specified to cover painting, general repairs and exterior maintenance such as lawn mowing, snow shovelling, spring and fall clean-ups." As previously noted, Mr. McCoy attempted to argue that Gore Mutual's Response to the Application for Arbitration acknowledged that Mr. McCoy had moved into permanent housing accommodation. However, in a manner consistent with the significant assumptions made in the future care cost report, Gore Mutual stated that "Mr. McCoy does not have a permanent residence" in respect of his claim for attendant care benefits.

Mr. McCoy's own future needs assessment in November 2001 also made important assumptions as to his living arrangements, proceeding on the basis that he would "reside in the motorhome as his principal residence for eight months of the year and utilize his small adapted van for the remaining months...[and] five years from now...reside in a two bedroom apartment or condominium in the Toronto area." Given the very speculative nature of these reports and the intent of the settlement to properly assess Mr. McCoy's needs once he moved into permanent accommodation, I do not accept that by seeking an assessment of Mr. McCoy's needs while he was living in his van precludes Gore Mutual from relying on the initial settlement agreement.

(ii) Whether Gore Mutual is precluded from relying on the settlement due to delay

I accept that Gore Mutual only formally raised the issue of the settlement as a bar to Mr. McCoy's arbitration in October 2002, roughly a month following the mediation in this matter. However, Mr. McCoy did not attempt to argue that the Commission lacked the jurisdiction to address Gore's position because it had not been properly mediated. In any event, as noted in the May 2003 pre-hearing letter, this issue was clearly "identified and agreed to" as a preliminary matter for determination in this arbitration. Further, I find that Gore Mutual did not delay unduly in raising this issue since the question of Mr. McCoy's attendant care benefits was only mediated in October 2002 and, as indicated in an August 2002 letter from the Insurer's solicitors at the time, a "formal application for increased attendant care benefits was not made until recently." I, therefore, see no basis for Mr. McCoy's submission that Gore Mutual delayed in a manner that precluded it from relying on the terms of the original settlement.

(iii) Whether Mr. McCoy could agree to modify the statutory DAC process

I do not accept that the parties could not, by agreement, adapt the DAC process to the particular circumstances of their case. Mr. McCoy submitted that, pursuant to section 50(4) of the Schedule, despite notice being given for a DAC to occur, Gore never pursued this, and they cannot now rely on the settlement to bar Mr. McCoy from proceeding to arbitrate his entitlement to attendant care benefits. Section 50(4) of the Schedule states that where the insured or insurer gives notice of the need for a DAC, the "assessment shall be conducted...." However, I find that the evidence relied on by Mr. McCoy is insufficient to establish that the parties formally invoked the DAC process under section 50, at least for the purpose of overriding any agreement they had previously reached regarding the circumstances under which a DAC assessment would occur. Mr. McCoy referred to two pieces of correspondence. In a July 2002 letter, Mr. McCoy's representative simply indicated that it was his understanding that the Insurer wished to arrange a DAC. In an October 2002 letter, Mr. McCoy's representative simply indicated that he was again requesting that the Insurer proceed with an attendant care DAC. In my view, these letters did not clearly indicate either that Mr. McCoy was electing to undergo a DAC assessment or that Gore Mutual was requiring him to be assessed by a DAC (the two steps that trigger the DAC process under section 50 of the Schedule). I, therefore, do not find that section 50 ousts the agreement reached between the parties in 1996.

However, even if a DAC had specifically been requested, I find that any obligation under the Schedule to conduct a DAC had been displaced by the process previously agreed to by the parties. Mr. McCoy cited three arbitration cases for the proposition that the statutory DAC process is mandatory and cannot be waived.² However, none of these cases dealt with the issue of how the DAC process ought to operate where the parties have agreed to structure it in a particular way. Patrick considered the appropriate remedy where an insurer disregards an insured's request for a DAC, finding that an adverse inference should be drawn against the insurer that the insured was entitled to benefits until the insurer complied with the DAC requirement. In Falco, the Arbitrator's decision to allow the hearing to proceed was upheld despite the fact that the insurer had not complied with its obligation to arrange for a DAC, because the insured had significantly delayed in raising the issue of the insurer's breach. Similarly, in Poulos, the Arbitrator allowed the hearing to proceed despite her finding that the insurer had failed to comply with the statutory termination provisions by not scheduling a medical and rehabilitation DAC. In my view, contrary to establishing the immutability of the DAC process, these decisions confirm that the DAC process is, and must be, sensitive to the actions and intentions of the parties.

I find that, as long as the parties complied with the statutory settlement provisions, they were free to structure the DAC process in the way they chose. Section 279(2) of the Insurance Act states that any restriction on a party's right to arbitrate an issue is void except as provided in the regulations. If Mr. McCoy and Gore Mutual complied with the Settlement Regulation, R.R.O. 1990, Ont. Reg. 664, as amended, they could agree to delay the DAC assessment until the happening of a particular event. As discussed below, I find that the parties did comply with this regulation. I, therefore, find that Mr. McCoy could not insist on a DAC under section 50 without first having moved into permanent housing accommodation, as the parties had initially agreed.

Despite his view that the DAC provisions in the Schedule are mandatory, Mr. McCoy also argued that he did not want to go to a DAC at this point, and that he simply wanted to proceed to an arbitration on the basis of the two existing future care cost reports. However, as noted above, these reports were highly speculative in nature, based as they were on Mr. McCoy's fluctuating living conditions. In light of the initial intention of the parties to properly assess Mr. McCoy's attendant care needs once he moved into more fixed accommodation, I find both that Mr. McCoy is not entitled to proceed, and that Gore Mutual need not respond, to an arbitration before Mr. McCoy complies with the negotiated assessment process.

(iv) Whether Gore Mutual is precluded from relying on the settlement because it failed to provide sufficient notice in accordance with the Settlement Regulation

Mr. McCoy submitted that the DAC settlement was a "final settlement" within the meaning of the Settlement Regulation and that Gore Mutual did not comply with the notice provisions of the Regulation. Mr. McCoy, therefore, argued that Gore Mutual could not rely on the settlement to preclude him from proceeding to arbitration. The Settlement Regulation defines a "settlement" as "an agreement between an insurer and an insured person that finally disposes of a claim or dispute in respect of the insured person's entitlement to one or more benefits under the Statutory Accident Benefits Schedule." I do not find that the parties had finally disposed of Mr. McCoy's claim for attendant care benefits. I find that the settlement was a procedural agreement by which Mr. McCoy's entitlement to attendant care benefits would be assessed and determined. Contrary to dictating a particular result, the parties wisely agreed to a process through which they could properly assess Mr. McCoy's needs and then determine their respective rights. Mr. McCoy cited the case of Coto and Allstate Insurance Company of Canada (FSCO A-951718, July 4, 1996) in which it was held that the agreement reached between the parties was not merely procedural in nature since the parties agreed that benefits would be paid pending the outcome of a DAC and that benefits would then either be continued or terminated based on the DAC's conclusions. In my view, however, this further suggests that the agreement reached in the present case was not a final settlement since the expected DAC assessment would not finally determine Mr. McCoy's entitlement to attendant care benefits.

Even if the agreement could be considered a final settlement within the meaning of the Settlement Regulation, I find that Gore Mutual complied with the relevant notice requirements. On October 23, 1996, Mr. McCoy executed a "Partial Full and Final Release" which incorporated the September 3, 1996 Minutes of Settlement. I find that the Release fully notified Mr. McCoy of the benefits available to him, the specific terms of the settlement, the potential impact of the settlement on his rights, his right to rescind the settlement and the advisability of his seeking independent legal and other advice before entering into the settlement. The Release also contains a Certificate of the Solicitor which confirms that Mr. McCoy's counsel advised him of the nature and effect of the settlement. Assuming the Settlement Regulation applies to this case, I find that Gore Mutual complied with its notice obligations.

(v) Whether fairness dictates that Mr. McCoy be allowed to proceed to arbitration

Finally, I do not accept that, as a matter of fairness, the settlement can or ought to be interpreted broadly so as to allow Mr. McCoy to proceed at this time to arbitrate his entitlement to attendant care benefits. Mr. McCoy invoked the contra proferentem rule, to the effect that any ambiguity in the language of the settlement ought to be interpreted in his favour (as the insured). In my view, however, the settlement clearly set out a process by which the parties were to assess Mr. McCoy's entitlement to attendant care benefits. The settlement also recognizes the pivotal role played by DACs in the adjustment of statutory accident benefit claims.³ The parties, themselves, wished to determine their respective rights through this process. Mr. McCoy reiterated the importance of the DAC process at the hearing. While the parties each obtained an assessment of Mr. McCoy's future care needs, as discussed above, these were based on basic assumptions about his future living conditions and did not, in my view, replace the need to obtain a full and proper assessment of Mr. McCoy's needs based on his living in permanent housing accommodation, as contemplated by the original settlement. Given the fluctuating nature of Mr. McCoy's accommodations, his stated intention of moving into more fixed living quarters and the parties' initial desire to obtain a neutral and concrete assessment of Mr. McCoy's attendant care needs, I do not find that, as a matter of fairness, Mr. McCoy ought to be permitted to circumvent the process he clearly negotiated with the Insurer. I note, as well, that Mr. McCoy retains his right to proceed to arbitration on the issue of his attendant care needs, as long as the terms of the settlement are fulfilled.

I, therefore, conclude that Gore Mutual is entitled to rely on the 1996 settlement and that Mr. McCoy is precluded from proceeding at this time to arbitration on the issue of his entitlement to attendant care needs.

EXPENSES:

The parties did not address the issue of expenses of the preliminary issue hearing. If required, the parties may now make submissions on this issue.

November 29, 2004

Eban Bayefsky Arbitrator

Date