Neutral Citation: 2004 ONFSCDRS 44
FSCO A02-000004
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
DEXTER HOWARD
Applicant
and
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
Insurer
REASONS FOR DECISION
Before:
William J. Renahan
Heard:
July 14 and 15, 2003 and February 27, 2004, at the offices of the Financial Services Commission of Ontario in Toronto.
Appearances:
Alan J. Davis, Barrister and Solicitor, for Mr. Howard
Eric K. Grossman, Barrister and Solicitor, for State Farm Mutual Automobile Insurance Company
Issues:
The Applicant, Dexter Howard, was struck by a motor vehicle on August 13, 1990 as he waited for a bus. His most serious injury was a fracture to the mid-shaft of the femur which was treated by the insertion of a metal rod. Mr. Howard applied for and received statutory accident benefits from State Farm Mutual Automobile Insurance Company ("State Farm"), payable under the Schedule.1
At the time of the motor vehicle accident Mr. Howard had two jobs. He worked full-time at Becker's Milk ("Becker's") in a refrigerated warehouse and part-time for Howard Johnson's as a banquet waiter. He returned to work at Becker's on January 24, 1992 and State Farm terminated weekly income benefits. Mr. Howard did not return to Howard Johnson's. He continued to work at Becker's for over three years until he was laid off due to lack of work in September 1995. He started another employment in July 1996 with Black's Photography ("Black's") from which he was laid off on January 24, 1997.
He claimed weekly income benefits under section 12 of the Schedule from January 24, 1997. State Farm refused to pay. The parties were unable to resolve their disputes through mediation, and Mr. Howard applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.
The hearing opened on July 14, 2003.
The functional tests for entitlement to a weekly income benefit are set out in section 12 of the Schedule. Under subsection (1) the insured person must suffer a "substantial inability to perform the essential tasks of his or her occupation or employment" to qualify for the benefit. This is often referred to as the "own occupation test." This coverage is restricted under paragraph 12(5)(b):
The insurer is not required to pay a weekly benefit under subsection (1),
(a) . . .
(b) for any period in excess of 156 weeks unless it has been established that the injury continuously prevents the insured from engaging in any occupation or employment for which he or she is reasonably suited by education, training or experience.
At the conclusion of Mr. Howard's testimony, on the first day of the hearing, it appeared to me that Mr. Howard could not establish that the "injury continuously" prevented him from engaging in suitable employment because of the lengthy returns to work from January 24, 1992 to September 1995, a period of more than three and a half years and from July 1996 to January 24, 1997, a period of half a year.
A number of expert witnesses were scheduled to testify and it was not clear to me how their evidence could affect the fact that Mr. Howard had returned to his former job and worked for three and a half years. In order to save the parties the expense of calling expert witnesses, the parties accepted my invitation that I determine whether Mr. Howard's return to work precluded him from establishing "continuous" disability.
In a decision dated August 29, 2003, I ruled that since the issue of whether disability was "continuous" was one of fact, I could not make a final determination until I heard all the evidence
The hearing resumed on February 27, 2004. The parties introduced documentary evidence and made submissions. They chose not to call any witnesses.
The issues are:
Is Mr. Howard entitled to weekly income benefits after January 24, 1997 pursuant to section 12(5)(b) of the Schedule?
Is Mr. Howard entitled to a special award pursuant to section 282(10) of the Insurance Act?
Is State Farm entitled to $3,000 pursuant to section 282(11.2) of the Insurance Act?
Is either party entitled to expenses of the arbitration proceeding?
Results:
Mr. Howard is not entitled to income replacement benefits after January 24, 1997.
Mr. Howard is not entitled to a special award.
State Farm is not entitled to an award pursuant to section 282(11.2) of the Insurance Act.
The issue of expenses is deferred.
The usual manner in which claims for weekly benefits are determined under section 12(5)(b) is first to determine what is suitable employment for the insured having regard to his education, training and experience and then determine whether his injury continuously prevents him from engaging in that employment.
In my decision dated August 29, 2003 in this matter, I determined that the test for entitlement as to whether Mr. Howard was continuously prevented from engaging in suitable employment applied starting August 20, 1993.
EVIDENCE AND ANALYSIS:
Suitable employment:
Mr. Howard is 34 years old. He completed grade 12 and the first year of a two year community college course in hotel management. He worked at jobs which were mostly physical. At the time of the accident, he worked 40 to 60 hours a week in a refrigerated warehouse at Becker's. Most of the work involved using a hook to pull skids of milk, weighing up to 90 pounds, across a wet floor. Mr. Howard also picked orders and loaded trucks. At the time of the accident, he earned approximately $40,000 per year from this job.
Mr. Howard also worked part-time at Howard Johnson's at the time of the accident. He set up for banquets and served as a waiter. I heard no evidence on how much time or money was involved with this work or its significance to his education or future. I do not find that part-time work as a waiter is a consideration in what is suitable employment for Mr. Howard.
In 1991, Mr. Howard told a counsellor that he would like to work in a factory setting or hospital where he was not required to do heavy lifting.
Having regard to Mr. Howard's education, training and experience, I find that any full-time physical indoor work which pays approximately $40,000 per year is suitable.
Ability to engage in suitable employment:
Two days after the accident, Dr. Gordon Hunter, an orthopaedic surgeon, operated on Mr. Howard and treated the fracture by inserting a 400 millimetre intra medullary nail in both ends of the fractured femur. In May 1991 he reported:
The fracture healed, and he was fit to return to work 6-7 months after his injury. This is most unusual and reflects on the motivation of the patient (and the treatment he has received.).
At the hearing, Mr. Howard showed his lower leg and I saw a bulge on the shin which measured approximately five by three inches. I also saw a well-used bandage wrapped below Mr. Howard's knee. The medical records describe a herniated or ruptured tibia muscle. I heard no medical evidence on the consequences of this injury.
According to a rehabilitation consultant's report, Becker's would not take Mr. Howard back to work unless he was fully capable of returning to full-time duties with no restrictions. Mr. Howard returned to Becker's on January 24, 1992.
At some point, which was not identified in the evidence, Mr. Howard was able to go to a different job at Becker's because of his seniority in the union. His new job was making up orders of milk. This job was less physically demanding than his old job. He missed no time from work in the three and a half year period from his return in January 1992 until he was laid off in September 1995. I do not accept Mr. Howard's testimony that he was laid off because of his injuries. He admitted he had no evidence to support the allegation, he took no action to dispute the layoff and that he was one of ten employees who were laid off on the basis of seniority because of lack of work.
In July 1996, Mr. Howard found full-time employment through an employment agency in a Black's Camera warehouse. He worked at a printing desk making up orders of prints and making copies of pictures from negatives. He did not miss any time from this work on account of his injuries. This work assignment ended on January 24, 1997, and Mr. Howard has not worked since.
Mr. Howard claims that his leg and his upper body are in pain. Cold and air conditioning aggravate his pain and as a result, he feels he cannot work in an air conditioned office, and that he could not have continued at Black's even if the job had not ended. He testified that he cannot walk unless he wears a tensor strap below his knee.
A few days after he stopped working at Black's, his family doctor referred him to Dr. Gordon Ko, a physiatrist. Dr. Ko, noted that Mr. Howard was quite focussed on getting more support for his legal case. He noted a limited range of motion in the knee and said that an MRI scan of the knee was important in view of the femur fracture. However, he could not arrange a scan until the pin was removed from the femur. The next month Mr. Howard saw Dr. Hunter. Dr. Hunter found a good range of motion in the knee and hip. He would not recommend removing the intra medullary nail.
Mr. Howard's lawyer referred him to Dr. Michael Kliman who saw Mr. Howard in September 1997 and January 2003. After the second visit, Dr. Kliman reported:
He has suffered a major ligamentous injury to his right knee. There is some evidence of chronic knee instability. There likely were some articular surface damages to his right knee . . . . The instability noted will be permanent and not progress.
As for his generalized complaints in regards to his neck, back, arms and left leg, these are a little more difficult to sort out, as there are no objective findings at this time. He likely has some chronic myo-fascial strain across the neck and back that indirectly relates to his right leg difficulties and likely relates to the soft tissue injuries at the time of his 1990 road-traffic accident.
In 1997, Dr. Kliman thought that Mr. Howard could work as a banquet waiter, although he might have difficulty working full- time due to complaints of back and leg discomfort. When Dr. Hunter saw Mr. Howard in February 1997,he reported that he encouraged him to try and obtain some suitable work. In 2003, he thought that Mr. Howard would have difficulty with a job that involved extended standing or walking. He thought that Mr. Howard could tolerate a light or sedentary job.
In June 1999, Mr. Howard's family doctor referred him to Dr. A. Kachooie, a physiatrist, who reported that Mr. Howard should be able to perform light duty modified work.
Mr. Howard did not seek much medical attention until he stopped working in January 1997. I do not draw any adverse inference from this. Mr. Howard suffered a serious injury and he returned to work in what his treating surgeon thought was record time. Mr. Howard impressed me as someone who would work with some discomfort and not complain about it.
Mr. Howard said that working in a refrigerated warehouse did not bother him because he kept moving and wore a big jacket. Yet, he claims that simple room air conditioning at Black's and travelling on a bus in the winter aggravate his pain to the point he cannot work. This does not make sense to me and I do not believe it. Because of his motivation to work, I believe that Mr. Howard would still be working at either Becker's or Black's had he not been laid off. The Becker's work was clearly suitable.
Mr. Davis conceded that I would find nothing in the documents that Mr. Howard should not work nor anything that Mr. Howard's returns to work could be construed as failed attempts to return to work. I found no reliable evidence that would allow me to describe Mr. Howard's returns to work as failed attempts to return to work.
The "continuous disability" test applied starting from August 20, 1993. Mr. Howard does not meet this test because he worked at his former job for two years after this date.
I find that Mr. Howard was not continuously disabled after August 20, 1993 from engaging in suitable employment. Therefore, he is not entitled to weekly income benefits pursuant to section 12(5)(b) of the Schedule.
Special award:
I heard no evidence that State Farm unreasonably delayed or withheld benefits. Accordingly, Mr. Howard is not entitled to a special award.
Assessment fee:
Section 282(11.2) of the Insurance Act, which allowed an arbitrator to make an award on a finding that the insured commenced an application that was frivolous, vexatious or an abuse of process, was repealed October 1, 2003.2 The Expense Regulation3 allows for the award of the filing fees paid by the insured person when applying for arbitration. It does not refer to the filing fees paid by the insurer. I do not have authority to award the assessment fee to the insurer.
Expenses:
If the parties cannot agree on the issue of entitlement to expenses of the arbitration proceeding they may make written submissions within 30 days of the date of this decision in accordance with Rule 79 of the Dispute Resolution Practice Code (Fourth Edition, May 31, 2001).
March 29, 2004
William J. Renahan
Arbitrator
Date
Neutral Citation: 2004 ONFSCDRS 44
FSCO A02-000004
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
DEXTER HOWARD
Applicant
and
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
Insurer
ARBITRATION ORDER
Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
The Application for Arbitration is dismissed.
The parties may make written submissions to me on the issue of entitlement to expenses of the arbitration proceeding within 30 days of the date of this decision.
March 29, 2004
William J. Renahan
Arbitrator
Date
Footnotes
- The Statutory Accident Benefits Schedule — Accidents Before January 1, 1994, Regulation 672 of R.R.O. 1990, as amended by Ontario Regulations 660/93 and 779/93.
- S.O. 2002, c. 22.
- R.R.O. 1990, Reg 664, as amended.