Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2005 ONFSCDRS 172

FSCO A03-001363

BETWEEN:

MARIA MICHALSKI by her guardian KRZYSZTOF MICHALSKI

Applicant

and

WAWANESA MUTUAL INSURANCE COMPANY

Insurer

REASONS FOR DECISION

Before:

Suesan Alves

Heard:

October 4, 5, and 29, 2004, and November 26, 2004, in London, Ontario.

Appearances:

Scott M. Merrifield for Mrs. Michalski

Elizabeth Scott for Wawanesa Mutual Insurance Company

Issues:

Mrs. Michalski was injured in a motor vehicle accident on October 24, 2001. She claims attendant care benefits for services her family members provided to her between November 2001 and September 2004 under the Schedule.¹ Mrs. Michalski also claims interest on attendant care benefits and on housekeeping benefits, a special award, and her expenses of the arbitration.

Wawanesa disputes that Mrs. Michalski is entitled to any of the relief she seeks.

The issues in this hearing are:

1. Is Maria Michalski entitled to attendant care benefits between October 31, 2001 and September 2, 2004 at the rate of $5,330.57 per month pursuant to section 16 of the Schedule?

2. Is Maria Michalski entitled to interest on overdue attendant care benefits and housekeeping benefits pursuant to section 46(2) of the Schedule?

3. Is Wawanesa liable to pay a special award pursuant to section 282(10) of the Insurance Act because it unreasonably withheld or delayed benefit payments to Maria Michalski?

4. Which party is liable to pay the other's expenses in respect of the arbitration under section 282(11) of the Insurance Act?

Result:

1. Maria Michalski is entitled to attendant care benefits between October 31, 2001 and September 2, 2004 at the rate of $5,330.57 per month pursuant to section 16 of the Schedule, with the exception of two periods. During November 2001, she is entitled to $2,877.07 because of a 14-day readmission to hospital; during February 2002, she is entitled to $5,122.52 because of a 19-day trial reduction in the amount of her attendant care. Wawanesa is entitled to a credit in an amount to be determined.

2. Maria Michalski is entitled to interest on housekeeping benefits in the amount of $7,062.18 pursuant to section 46(2) of the Schedule. She is also entitled to interest on attendant care benefits in an amount to be determined.

3. Wawanesa is liable to pay a special award in an amount to be determined on attendant care benefits and on housekeeping benefits pursuant to section 282(10) of the Insurance Act because it unreasonably withheld or delayed benefit payments.

4. The parties shall have 30 days to resolve the issues of the amount of Wawanesa's credit for attendant care benefits, interest on attendant care benefits and to make a joint submission in relation to these amounts, failing which I will receive further evidence and submissions on these issues.

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

EVIDENCE AND ANALYSIS:

Background

Maria Michalski suffered serious injuries in a motor vehicle accident on October 24, 2001. Her injuries included a closed head injury, a lacerated scalp, a lacerated spleen, a fractured rib, and soft tissue injuries to her neck and back. She also developed a seizure disorder, as a result of which she experienced grand mal seizures at a frequency of once or perhaps twice a month until July 2003. Thereafter, her seizure disorder has been well controlled with medication.

At the time of the accident, Mrs. Michalski was 44 years of age, a homemaker and newspaper carrier. She lived in London, Ontario, with her husband and their two children Michael and Sandra, aged 13 and 10.

Mrs. Michalski brings this arbitration by her husband, Krzysztof Michalski, who is the guardian of her person and property under the Substitute Decisions Act² Mr. Michalski acted as his wife's representative in relation to her claims for statutory accident benefits until July 2002, when he retained counsel to act on his wife's behalf. In this arbitration, he wears a number of additional hats: Mrs. Michalski's provider of attendant care, and the provider of housekeeping services after the accident.

This arbitration concerns Mrs. Michalski's claim for payment for the attendant care services her husband and their children provided from the date of her discharge from hospital, on October 31, 2001, until the date of the attendant care DAC assessment, on September 3, 2004.

The disputes in this arbitration deal with the interaction between the claims process, the attendant care and catastrophic impairment processes under the Schedule. The relevant portions of the Schedule — section 2, subsections (1), (2),(3) and(7); and sections 16, 17, 32, 39, 40, 43 and 46(2) are set out in Appendix A.

For the reasons which follow, I conclude that Mrs. Michalski was catastrophically impaired from the outset, that Wawanesa knew this, that she is entitled to attendant care benefits for the period in question, interest on attendant care and housekeeping benefits and a special award. I remain seized of the amount of the credit to which Wawanesa is entitled in relation to the attendant care it paid, the amount of interest on attendant care benefits, and the amount of the special award.

I will first deal with the catastrophic impairment issues, then the attendant care issues, then the claims for interest and a special award.

Catastrophic Impairment issues

1. Sustaining catastrophic impairment

I find Mrs. Michalski met the definition of catastrophic impairment on the day of the accident for the following reasons.

Under this Schedule, a person who sustains a catastrophic impairment is entitled to enhanced benefits.³

Two such benefits are of concern in this arbitration: attendant care and case management benefits. A person who sustains a catastrophic impairment is entitled to attendant care benefits at the maximum monthly rate of $6,000, instead of $3,000. Only persons who sustain catastrophic impairments can obtain case management services.

Section 2 of the Schedule defines those injuries or impairments which qualify as catastrophic. A person may sustain a catastrophic impairment in a number of different ways. Some examples are paraplegia; quadriplegia; amputation or other impairment causing the total and permanent loss of use of both arms, or a total loss of vision in both eyes.

A person may sustain a catastrophic impairment at different points in time. In some cases, a prescribed length of time must elapse before the impairment will qualify as catastrophic within the meaning of the Schedule. For example, under subsections 2(1)(f),(g), and 2(2)(b), three years must have elapsed since the accident.

In other cases, the evidence of catastrophic impairment will be immediately apparent, and beyond dispute. For example, a person whose arms are amputated at the time of the accident will immediately meet the definition of having sustained a catastrophic impairment under section 2(1)(b) of the Schedule.

In Mrs. Michalski's case, ambulance attendants evaluated the extent of her head trauma using the Glasgow Coma Scales at the scene of the accident. Later, emergency room personnel at the hospital also used these scales. Glasgow Coma Scales were designed by neurosurgeons as a standardized way of measuring coma or semi-coma. Three scales are used — eye opening, speech and motor movement. The highest score attainable is 15. Mrs. Michalski's scores recorded by the ambulance attendants and by hospital personnel were reported to be between 3 and 9. Scores at such levels are indicative of a serious brain injury.

When Glasgow Coma Scales are "administered within a reasonable period of time after the accident by a person trained for that purpose", a person with such scores is catastrophically impaired within the meaning of section 2(1)(e)(i) of the Schedule.

In my view, absent disputes as to whether the scores were administered within a reasonable period of time post-accident, or as to whether the person or persons who administered the test were trained for that purpose, Mrs. Michalski's catastrophic impairment was immediately apparent.

Wawanesa did not raise either dispute or offer evidence to the contrary at the arbitration, or at the CAT DAC. I infer that Wawanesa has no evidence to the contrary. I find that on the day of the accident, Mrs. Michalski met the definition of catastrophic impairment as a result of brain impairment pursuant to subsection 2(1)(e)(i) of the Schedule.

I find Wawanesa knew Mrs. Michalski was catastrophically impaired at the outset and acted on that knowledge, in some respects. I find Wawanesa acted on the basis that Mrs. Michalski was catastrophically impaired when it hired Ms. B. Whittingham as case manager on or about October 30, 2001, because under section 17 of this Schedule, only persons who sustain a catastrophic impairment are entitled to such services.

Section 2 of the Schedule defines a case manager as "a person who provides services related to the coordination of goods or services for which payment is provided by a medical, rehabilitation or attendant care benefit." I find Ms. Whittingham performed the case manager function based on her reports over the ensuing three-year period and her testimony. As of the date of the hearing, Wawanesa continued to retain Ms. Whittingham to provide case management services.

Mrs. Michalski was admitted to hospital following the accident. When the hospital was ready to discharge her, it asked Wawanesa to make arrangements for Mrs. Michalski's attendant care, in a letter dated October 29, 2001. That letter referred to a claim and policy number. I find it likely that Wawanesa had some initial information about Mrs. Michalski's injuries, as it had already opened a claim file and was able to respond promptly to the hospital's request.

The case manager arranged for an insurer's examination of Mrs. Michalski's attendant care needs by an occupational therapist. Ms. S. Korsmit, occupational therapist, reported to Wawanesa that Mrs. Michalski's Glasgow Coma Scores were 3/15 at the time she was received by the hospital, and that Mrs. Michalski required 24 hour a day attendant care. I find Wawanesa received Ms. Korsmit's report on November 14, 2001, based on Wawanesa's date stamp on the covering letter.

The application for accident benefits

Mr. Michalski completed an application for accident benefits for his wife, which Wawanesa received on November 5, 2001. He also completed an Activities of Normal Life form, dated November 11, 2001. I allow seven days for Wawanesa to receive that document, and find Wawanesa received all the application documents by November 18, 2001.

The documentation Mr. Michalski filed with Wawanesa showed that pre-accident, Mrs. Michalski engaged in extensive physical activities, could do all of the tasks itemized under cognitive activities, controlling emotion/behaviour and communication. Post-accident, she was unable to do most of the itemized tasks and activities. Indeed, the only area in which she was able to function without assistance was that of finding words to express her thoughts. I find this information confirmed for Wawanesa that Mrs. Michalski sustained a catastrophic impairment in the motor vehicle accident.

I find that Mrs. Michalski's completed application for accident benefits disclosed that at the time of the accident she was a homemaker, had two children under 16 years of age, and was primarily responsible for shopping, meal preparation/cooking, washing dishes, cleaning, laundry, housekeeping and home maintenance activities.

I find four things were readily apparent from the documentation in Wawanesa's possession in November 2001 — Mrs. Michalski met the definition of catastrophic impairment under section 2 of the Schedule; she could no longer look after herself, but required care; she could no longer give her children, aged 10 and 13 care; and she could no longer provide the housekeeping and homemaking services she once did for herself and for her family.

Mrs. Michalski therefore required attendant care and housekeeping services, and her family members needed services to replace the housekeeping and home maintenance services she once provided.

In the case of State Farm Mutual Automobile Insurance Company and L.F., (FSCO P02-00026, June 3, 2004), Director's Delegate Makepeace considered the insurer's obligation under section 32 of the Schedule. She held that once an insurer receives an application for accident benefits, it "... is expected to adjust the claim and determine what benefits may be available based on the information received. The process is designed to ensure that an unsophisticated claimant receives the appropriate benefits. The SABS is clear about this. The insurer bears the obligation to provide sufficient information to enable the consumer to claim benefits." In my view, the insurer's obligation includes assisting a claimant to gain access to an enhanced level of benefits.

I find Mrs. Michalski's completed application provided sufficient information, that she applied for attendant care benefits, housekeeping benefits and for a determination that she was catastrophically impaired in November 2001. It then fell to Wawanesa to identify her entitlement to those benefits and adjust her claim accordingly.

2. Determining catastrophic impairment

Wawanesa submits that a person must first be determined to be catastrophic by a CAT DAC to gain access to the enhanced level of benefits. Wawanesa submits that since the CAT DAC in this case concluded that Mrs. Michalski sustained a catastrophic impairment in August 2003, she would only be entitled to enhanced attendant care benefits as of that time. I disagree with this analysis and conclusion.

The Schedule provides that a person who sustains a catastrophic impairment is entitled to enhanced benefits. Section 40 of the Schedule sets out the process by which an insured person may seek a determination that the impairment she sustained is catastrophic. Within 30 days after it receives the application, the insurer is obliged to determine whether the impairment is catastrophic or not catastrophic, and notify the claimant if it requires a CAT DAC.

If the insurer agrees that the impairment is catastrophic, then it is required to give the insured person notice that it has made that determination. If the insurer disagrees, then the insurer is obliged to give notice of its determination along with reasons for the determination that the insured person did not sustain a catastrophic impairment. Once the CAT DAC report is issued, its determination is binding on the insurer and the insured, pending the determination of a dispute by court or arbitration.

Thus, there is no requirement that a CAT DAC be held in all cases. In my view, in the absence of a dispute, the provisions allow for the flow of an enhanced level of benefits without the need for an assessment by a designated assessment centre.

DAC assessments were set up to provide a neutral opinion to assist insurers and insured persons to resolve disputes concerning certain benefits. In my view, the parties may agree that a person has sustained a catastrophic impairment as a result of which the insured person can enjoy enhanced benefit entitlement.

I find Wawanesa determined that Mrs. Michalski sustained a catastrophic impairment even before it received her completed application for benefits, because it retained a case manager.

However, it failed to inform Mrs. Michalski that it had made such a determination as required by section 40(2)(a) of the Schedule. Mrs. Michalski was entitled to notice of Wawanesa's determination that she sustained a catastrophic impairment by December 18, 2001.

Under the Schedule, a claimant is either catastrophically impaired or not. The Schedule does not contemplate the possibility that an insurer may take an inconsistent position on this question. Wawanesa had evidence that Mrs. Michalski met the lexical definition of catastrophic impairment, and no evidence to the contrary. Wawanesa hired a case manager in October 2001, something it can only do if she sustained a catastrophic impairment, yet informed her that she was only entitled to $3,000 in attendant care benefits, the level available to claimants who do not sustain catastrophic impairment.

I appreciate there appears to be a view, that first party insurers may take inconsistent positions in the context of an arbitration. Wawanesa's inconsistent position in this case — to treat Mrs. Michalski as catastrophically impaired for some, but not all purposes — was taken at the outset of the claim, when Mrs. Michalski was unrepresented, and there was no indication that arbitration or litigation was contemplated.

Taking that inconsistent position at the outset of the claim conflicts with Wawanesa's obligation under section 32 of the Schedule, to provide information to assist Mrs. Michalski in applying for benefits.

If, however, Wawanesa was entitled to take that inconsistent position, I find it was nevertheless obliged to inform Mrs. Michalski on a timely basis, that is to say by December 2001, about the CAT DAC process and provide her with the necessary forms for completion by a physician which Wawanesa could then submit to a CAT DAC. I find Wawanesa did not provide such information. I find it did not provide those forms to Mrs. Michalski before March 2003, when, following inquiries by her counsel, Wawanesa required her to provide the forms, completed by a physician who opined that she sustained a catastrophic impairment.

I also find Wawanesa's position, taken in 2003, that Mrs. Michalski required a determination by a CAT DAC, to avail herself of enhanced benefits, is inconsistent with Wawanesa's actions of providing case management services since 2001.

3. Timing of the CAT DAC

The Schedule does not prescribe the time at which a CAT DAC is to be held. Since DACs function as part of a process to resolve disputes, I find the appropriate time to schedule a CAT DAC is when the opinion of the DAC would provide an answer which is germane to a dispute between the parties.

For example, where the issue is whether a benefit is payable for longer than 104 weeks, such assessments are likely to be requested and scheduled as the 104 week mark approaches. Where the issue is whether a person sustained a catastrophic impairment after three years have elapsed, such an assessment would be done at or near the 156 week mark. Similarly, where the dispute concerns the amount payable for a benefit or the amount available for payment at the commencement of the claim, the appropriate time to schedule a CAT DAC would be at the commencement of the claim, when the dispute arose. In this case, if a CAT DAC was necessary, it should have been arranged in December 2001.

Attendant Care Issues

1. The attendant care process

Attendant care benefits provide for care a claimant requires following a motor vehicle accident. Section 39 of the Schedule deals with the attendant care process. Under that section, an insurer that receives an application for an attendant care benefit is required within 14 days to either approve the expenses and pay them; require the insured to provide a Form 1; or set up an assessment by a designated assessment centre and pay the attendant care benefit pending receipt of the report of the attendant care DAC.

An insurer is also obliged to arrange attendant care DACs whenever it wishes to reduce the amount of attendant care, and whenever a claimant seeks an increase in the amount of attendant care. The insurer is obliged to continue to pay attendant care at the existing rate, pending receipt of the DAC report. I will deal with this further in the section on the claim for a special award.

2. The attendant care claimed

I find Mr. Michalski, Michael and Sandra provided the bulk of Mrs. Michalski's attendant care. They cared for her in the afternoons and evenings during the week, and full time on weekends.

I find the attendant care services claimed in this arbitration were provided and the expenses were therefore incurred within the meaning of section 16(2) of the Schedule, as Arbitrator Wilson held in Stargratt and Zurich Insurance Company of Canada (FSCO A99-000521, October 4, 2001).

Mr. Michalski works a 40 hour week outside the home. He gets Mrs. Michalski dressed in the mornings before he leaves for work. At that time, the paid caregiver takes over Mrs. Michalski's care on weekdays for up to eight hours a day.

Mr. and Mrs. Michalski's 13 year old and 10 year old children, Michael and Sandra, then supervise their mother when they return from school in the afternoons. The children contact Mr. Michalski on his cell phone if anything is amiss.

On his return from work, Mr. Michalski makes supper and looks after his wife until the next morning. During the night, Mrs. Michalski awakens and is frightened. Mr. Michalski comforts and settles her and she then goes back to sleep.

On weekends, Mr. Michalski and the children are solely responsible for Mrs. Michalski's care. During the summer of 2002, when Wawanesa reduced the paid attendant care to three hours per day, the children were primarily responsible for their mother's care while their father was away at work.

3. The recovery issue

The Applicant submits that she has always required attendant care 24 hours per day since the motor vehicle accident as a result of the impairments she sustained. Wawanesa alleges that Mrs. Michalski enjoyed a period of recovery during which she required as few as three hours per day of attendant care. For the reasons which follow, other than for a 19 day period, I reject the evidence that Mrs. Michalski required less than 24 hours of care during the period in question.

The Applicant's evidence

The care providers

Ms. Julita Wdowikowski, Mrs. Michalski's adult daughter, and Mr. Michalski both testified that before the accident, the Applicant had been an efficient homemaker whose role, and, indeed, her only hobby, had been looking after her home and family.

They testified that after the accident, she functioned much like a two year old child. She required care twenty-four hours per day, and they have ensured that she was never left unattended. Both testified that following the accident, Mrs. Michalski required supervision to prevent her from harming herself inadvertently or from coming to harm, direction to focus on tasks and to complete tasks. She did not speak very much and her speech was not always responsive to the questions asked. At times she was echolalic. Her meals needed to be prepared for her. She developed a seizure disorder and had grand mal seizures at a frequency of once or twice a month. Initially her caregivers would take her to the emergency department at the hospital following a seizure, however, over time, they provided her necessary care during and after her seizures.

Mr. Michalski and Ms. Wdowikowski testified they saw no improvement in Mrs. Michalski's level of function over time. They are at a loss to understand Wawanesa's reductions in the amount of Mrs. Michalski's attendant care. Both deny that Mrs. Michalski enjoyed a period of recovery during which she required less than 24 hour a day care, as Wawanesa alleges.

Ms. Wdowikowski was one of the paid attendant caregivers between September 2003 and the date of the hearing. During that time, Ms. Wdowikowski lived in Mississauga with her husband and their infant. She commuted to London weekly with her child, spent Mondays to Fridays in London caring for the Applicant, and on weekends returned to Mississauga. I find Mr. Michalski and Ms. Wdowikowski provided extensive care to Mrs. Michalski post-accident and were therefore in a position to assess her level of function over time. I found both of them to be credible, sincere, and given to understatement. I accept their evidence.

The Applicant's medical evidence

Dr. S. Dobrowolski, a psychiatrist who treated Mrs. Michalski prior to the accident for anxiety and depression as part of a court diversion program, and who continued to see her following the motor vehicle accident, testified at the hearing.

Dr. Dobrowolski described a dramatic contrast in Mrs. Michalski's pre- and post-accident levels of function. He attributes those changes to the closed head trauma she sustained in the accident. Following the accident, her cognitive and emotional function decreased and her presentation became childlike. At times, she was unable to remember the names of her children; could not say what she would do in the event of an emergency; was unable to tell the season, month or year, even when there were visual cues in the room, such as Christmas decorations.

Dr. Dobrowolski noted that Mrs. Michalski's level of function is variable, and there are times when she seems to appreciate far more than would be anticipated. For example, at one session, Mrs. Michalski was aware of a problem with a bill from the cable company. In his opinion, Mrs. Michalski required constant close supervision like a dementing individual because she cannot be counted on to recognize danger or make appropriate judgments when cooking, etc.

In Dr. Dobrowolski's opinion, in the immediate post-accident period, Mrs. Michalski confabulated — when she did not remember the answer to a question, she made one up. For example, she had no memory of the car accident, denied having being involved in one, and explained her injuries by reporting that she had been attacked and stabbed by a man. She responded tangentially to questions. At times she was psychotic.

In mid-January, 2002, there was a period when it seemed to Dr. Dobrowolski that Mrs. Michalski began to improve, as she began to recover some of her early memories. On January 30, 2002, Mrs. Michalski's attendant found her curled up in a fetal position muttering that life was not worth living, and arranged an emergency consultation with Dr. Dobrowolski. During that assessment, Mrs. Michalski complained that she was not being given sufficient "space" in her own home. Her caregivers were even following her to the bathroom and she was repeatedly badgered with "do you remember" questions.

On January 31, 2002, Dr. Dobrowolski and Ms. K. Sellars, an occupational therapist retained by Wawanesa, agreed that a trial reduction in Mrs. Michalski's attendant care was warranted, along with less intrusion on the part of the caregivers. The occupational therapist and the case manager agreed that Mrs. Michalski's adjustment to the change would be monitored and that any further changes would involve Dr. Dobrowolski.

By February 19, 2002, Dr. Dobrowolski concluded that Mrs. Michalski was worse than ever, and that she required full-time care. In his opinion, Mrs. Michalski then began to regress, and deteriorate.

In Dr. Dobrowolski's opinion, in the fall of 2002, Mrs. Michalski experienced a profound decline in her function. In November 2002, Dr. Dobrowolski noted she had difficulties maintaining normal balance, and by December 2002, she was profoundly impaired. In Dr. Dobrowolski's opinion, the decline in Mrs. Michalski's function was a result of the progression of diffuse brain injuries she sustained in the accident.

In March 2003, he described Mrs. Michalski as "living in her own world," and not aware of reality in a normal fashion. Dr. Dobrowolski noted that in the past, Mrs. Michalski would attempt to answer his direct questions even when she could not remember the answers to questions about her life. In March 2003, Mrs. Michalski stared blankly and did not appear to understand the questions Dr. Dobrowolski asked.

Dr. Dobrowolski described the changes as "profound," and that when comparing the pre-and post-accident Mrs. Michalski, it was almost as if they were two different people. He sees her "level of impairment as a result of her accident as truly catastrophic, implying an almost complete 100% impairment of her person as I knew her before this tragic collision."⁴ In Dr. Dobrowolski's opinion, Mrs. Michalski required full-time supervision to prevent inadvertent harm to herself and to others.

Given Dr. Dobrowolski's knowledge of his patient pre- and post-accident, the frequency with which he saw her over time, and his expertise in psychiatry, I accept his opinion with respect to the nature of Mrs. Michalski's pre- and post-accident condition, and her deterioration and regression over time. I also accept that Mrs. Michalski needed 24 hour attendant care throughout the period in question.

I accept that the arrangement to reduce Mrs. Michalski's attendant care on a trial basis by 1.5 hours per day during the 19-day period in February 2002, and to provide less intrusive care, was reasonable. All concerned, the occupational therapist, case manager, Wawanesa, Dr. Dobrowolski, Mr. and Mrs. Michalski agreed with this trial arrangement. Unfortunately, as detailed later, Wawanesa then proceeded to effect further reductions in Mrs. Michalski's paid attendant care without consulting Dr. Dobrowolski, and in opposition to the wishes of Mr. and Mrs. Michalski.

In July 2002, Mr. Michalski wished an increase in Mrs. Michalski's attendant care because only three hours of paid attendant care was being provided. He was concerned about his wife's care when the children returned to school. The case manager recommended to Wawanesa that it double the number of allocated hours, but that it continue to pay the same monthly amount as attendant care. This was a sop to Mr. Michalski, and an illusory benefit. I am unable to tell from the documentation which was filed whether Wawanesa followed or rejected the case manager's recommendation.

Mr. Michalski then retained counsel, who obtained an assessment of Mrs. Michalski's attendant care needs by an occupational therapist, Ms. N. Robinson. In February 2003, Ms. Robinson opined that Mrs. Michalski would be completely unsafe if left alone even for brief periods of time due to her significantly impaired balance, somewhat impulsive behaviour, and the risk of injury if she were to have a seizure. In Ms. Robinson's opinion, Mrs. Michalski required 24 hours of attendant care per day.

In August 2004, Dr. J. Sweeney, a psychologist and a specialist in the neuropsychology of head injury, and who is known internationally through publications that address the neuropsychology of exposure to violent acceleration forces in motor vehicle accidents, was scheduled to assess Mrs. Michalski at the request of her counsel. In Dr. Sweeney's opinion, her condition precluded valid clinical neuropsychological testing.

Dr. Sweeney opined that Mrs. Michalski had a "debilitating neuropsychological disability characterized by diminished alertness as a consequence of subcortical brain damage" suffered in the motor vehicle accident of October 24, 2001, which renders Mrs. Michalski "completely incapable of living safely without constant supervision and guidance through attendant care. Her behaviour is unpredictable and essentially without purpose, representing a potential source of danger or injury to herself or others as she interacts with her environment. She requires a highly structured daily routine developed with needs for safety and stimulation in mind and maintained by an attendant care worker. She should be supervised during periods of sleep because of the possibility of waking and putting herself at risk through random interaction with her environment."

The Insurer's evidence

The case manager

Ms. Whittingham, the case manager, testified that she and Mrs. Michalski had intelligent conversations with each other during which Mrs. Michalski complained of pain, expressed her wishes, such as going to the gym following the accident. Ms. Whittingham testified that she sought and obtained funding for a gym membership and Mrs. Michalski reported that she participated in and enjoyed this activity.

I am not persuaded that these discussions are evidence of normal adult cognitive function or evidence that she did not require care. I find these discussions entirely consistent with Mrs. Michalski's one intact ability following the accident, namely, her ability to find words to express her thoughts. Mrs. Michalski had that ability in November 2001, less than a month following the accident, when by all accounts she required 24 hour a day care.

The insurer's occupational therapists

Wawanesa also relied on the assessments of occupational therapists who conducted insurer examinations of Mrs. Michalski under section 42 of the Schedule. Although the first two assessments reflected a need for attendant care 24 hours a day, subsequent assessors reduced the amount of care.

As noted earlier, a trial reduction in Mrs. Michalski's attendant care for 19 days was reasonable. Because Mrs. Michalski continued to require assistance and attendant care due to her physical, cognitive and emotional limitations, Ms. Sellars, the occupational therapist, and Mrs. Whittingham, the case manager, agreed to consult with Dr. Dobrowolski in relation to any further reductions in care. Despite their plan, I find neither sought Dr. Dobrowolski's opinion with respect to Mrs. Michalski's needs.

By March 6, 2002, when Ms. Sellars reduced Mrs. Michalski's attendant care to 10.14 hours per week, based on "gains in functional independence", Dr. Dobrowolski was no longer supportive of a reduction in Mrs. Michalski's attendant care. In a report dated March 27, 2002, Ms. Sellars reduced Mrs. Michalski's allocated attendant care, based on "Mrs. Michalski's improved performance during one occupational therapy session." I find improvement in function demonstrated in one session provides an unsound and unreliable basis for reducing attendant care for someone like Mrs. Michalski who had variable function.

Each of the case manager's subsequent reports to Wawanesa, in March, April, May, June and July, 2002 state in the body of the report that Dr. Dobrowolski continues to report further improvement. I find each of those comments at significant odds with the contents of Dr. Dobrowolski's notes, records, reports to third parties, and an implausible summary of his opinion.

The case manager instructed Ms. C. Currado, the occupational therapist who succeeded Ms. Sellars, to assess Mrs. Michalski and to "review and reduce" her attendant care. Such instructions suggest that the outcome of reduced attendant care was predetermined, at least to some degree.

Ms. Currado reduced Mrs. Michalski's attendant care. I find her reasoning in doing so illogical. She asserted on the one hand that the existing attendant care arrangements should remain in place because there was no medical release from Dr. Dobrowolski to reduce her attendant care; yet, at the same time, she opined that it was reasonable to reduce Mrs. Michalski's attendant care.⁵

Given the plan that Dr. Dobrowolski was to be part of the decision to effect any reductions in Mrs. Michalski's attendant care, I find that in recommending and effecting further reductions in Mrs. Michalski's attendant care, the occupational therapists and the case manager shut their eyes to relevant information which they agreed would be sought in making that decision, and were wilfully blind. Wilful "blindness arises where a person who has become aware of the need for some inquiry declines to make the inquiry because he does not wish to know the truth."⁶

I reject the opinions of the occupational therapists that Mrs. Michalski required less than 24 hour care, because they ignored the most significant of her post-accident impairments, and because they were based on wilful blindness.

I find Wawanesa could not have been unaware of the reductions in care, or unaware that those reductions were achieved by ignoring the significant cognitive and emotional impairments Mrs. Michalski sustained in the motor vehicle accident.

In each of her reports, the case manager informed Wawanesa of the reductions of attendant care achieved. The reports from Ms. Sellars and Ms. Whittingham omit the issue of whether Dr. Dobrowolski agreed with or favoured further reductions in Mrs. Michalski's care. Ms. Currado's report emphasizes no medical or psychiatric opinion which favoured reductions had been obtained.

The Insurer's Medical Evidence

Wawanesa's assessments on January 20, 2003, by Dr. M. Kuiack, a psychologist, and by Dr. J. Mount, a psychiatrist, on January 27, 2003, confirm the level of function described by Mr. Michalski, Ms.Wdowikowski, Dr. Dobrowolski, Dr. Sweeney and Ms. Robinson.

Dr. Kuiack concluded that neuropsychological examination, further mental status testing, or cognitive screening were not possible. Dr. Kuiack noted "In contrast with some of the descriptors of her behaviour and level of function in some rehabilitation reports, her presentation on January 20, 2003 was certainly not consistent with that of an individual who could direct her care or her attendant's activities, assume responsibility for parenting, or function effectively or appropriately in a gymnasium environment."

I find that Dr. Kuiack's report squarely put into question the assessments of the occupational therapists and case manager. Either Wawanesa's occupational therapists and case manager were wrong, or Mrs. Michalski had become more profoundly impaired, or both.

Dr. J. Mount, psychiatrist, reported that when he glanced into his waiting room before beginning the assessment, he thought Mrs. Michalski, seated on the floor of his office waiting room leafing through a magazine in a child-like fashion, was a child. When asked her date of birth Mrs. Michalski responded that she was born "yesterday" then offered the spontaneous remark "Henry gave me tea." When asked her husband's name, she responded "was." She then added "he's going to be there with the kids and the cat. The cat drank the milk."

Dr. Mount concluded that Mrs. Michalski was incapable of functioning in an interview setting, and was incapable of giving informed consent.

Other events

On April 22, 2003, Mrs. Michalski was adjudged to be incapable of managing her personal care and her property under the Substitute Decisions Act by Mr. Justice Browne of the Ontario Superior Court of Justice.

On May 9, 2003, Dr. Dobrowolski reported that Mrs. Michalski "needs continuous around the clock supervision by responsible adult care-givers."

On September 3, 2004, the attendant care DAC concluded that Mrs. Michalski required attendant care 24 hours a day.

Number of hours of attendant care

I find that Mrs. Michalski required 24 hour a day attendant care from the time she was discharged from the hospital because of her cognitive, emotional and physical impairments, her seizure disorder, as well as her level of physical function — she had difficulties with balance and had sustained a fractured rib and soft tissue injuries to her neck and back.

I accept that she had some improvement in her soft tissue injuries. Her difficulties with balance improved, but then worsened. Other than the trial period of 19 days, involving a reduction of 1.5 hours of attendant care per day, I am not persuaded that Mrs. Michalski's cognitive and emotional impairments improved sufficiently at any point during the period in question to reduce her attendant care.

I prefer the evidence of Mr. Michalski, Ms. Wdowikowski, and the opinions of Dr. Dobrowolski, Dr. Sweeney, Dr. Mount, and Dr. Kuiack where they conflict with the evidence of the case manager and the occupational therapists. In my view, the overwhelming picture throughout the period in question is one of a lack of capacity and of a person requiring care 24 hours a day based on the impairments she sustained in the accident.

Payment for 24 hours?

Although Wawanesa's first two occupational therapy assessments stated that Mrs. Michalski required care 24 hours a day, the assessors allocated payment for her care for 16.25 and 16 hours, respectively. The rationale, according to the testimony of Ms. D. Kemp, an occupational therapist retained by Wawanesa, was that family members were to be paid for their services, but not during the evening hours when they would have been at home in any event. This rationale would effectively eliminate most, if not all of the claim for payment by Mr. Michalski, Sandra and Michael for the services they provided.

I disagree with that rationale. It ignores the fact that care was being provided to Mrs. Michalski post-accident, which was not provided pre-accident. For example, pre-accident, the children came home after school and were cared for by their mother. Post-accident, they came home and provided care for their mother. This limited the time they had for recreation, homework and other activities. I find the location in which the services were provided irrelevant in the circumstances of this case.

Post-accident, Mr. Michalski would be available to and provide care for his wife, and make meals. When she was discharged from hospital, Mr. Michalski slept on the floor, downstairs, next to her hospital bed. Mrs. Michalski's balance difficulties were sufficiently profound at that time, that she would fall when attempting to get out of bed. Her balance improved somewhat, but then worsened again.

At night, Mrs. Michalski awakens. Mr. Michalski comforts and soothes her and gets her to go back to sleep. Of necessity, Mr. Michalski's care for his wife requires availability, a degree of discomfort, and vigilance, even while asleep.

Providing care and supervision to someone functioning at Mrs. Michalski's level is of necessity different from simply being present in the company of an adult who is functioning without such impairments. For these reasons, I conclude that Mrs. Michalski's caregivers should be compensated on a 24 hour basis during the period in question, because they have provided necessary care around the clock.

The monthly attendant care rate

There is no single assessment which covers the entire period in question. Mrs. Michalski claims payment of attendant care for the period in question at the rate of $5,330.57 per month. I find the rate is reasonable because it is also the rate assessed by the attendant care DAC.⁷ Further, if one extrapolates 24 hours of care from the insurer's initial occupational therapy assessment, using the average cost of care, one obtains a higher rate than the rate the Applicant proposes.

I have considered the possibility that Mrs. Michalski's assessment of her attendant care needs, done at a time when her impairments were more profound, could result in overcompensation when applied to an earlier period, when Mrs. Michalski's function was regressing and deteriorating. If anything, the reverse is true. In Mrs. Michalski's case, the majority of the attendant care she requires is supervisory, and this paid at the lowest rate available under the Schedule.

I have calculated the period in issue as 34 months and 2 days; the daily rate as $175.25 and the average hourly rate at $7.30. During November 2001, Mrs. Michalski was readmitted to hospital for 14 days. During February 2002, a 19-day trial reduction of 1.5 hours per day was reasonable. I find the amount Wawanesa owes Mrs. Michalski for attendant care benefits to be $178,928.33 calculated as follows:

32 months at $5,330.57

$ 170,578.24

2 days at $175.25

350.50

1 month, Nov. 2001 at $5,330.57 - $2,453.50 [($175.25 x 14 days)]

2,877.07

1 month, Feb. 2002 at $5,330.57 - $208.05[($7.30 x 1.5 x 19 days)]

5,122.52

$ 178,928.33

I conclude that Wawanesa shall pay Mrs. Michalski $178,928.33, less a credit in an amount to be determined.

Wawanesa's credit

Wawanesa paid $89,870 in attendant care during the period in question. According to the case manager, between October 31, 2001 and July 2002, Wawanesa arranged for fewer hours of paid care, and paid for that care at higher rates than contemplated by the Schedule and by Wawanesa's own assessments. The case manager testified that rates of up to $22 per hour were paid, when the Schedule prescribes rates of $7, $9 and $15 per hour, depending on the level of care.

I agree with the Applicant that Wawanesa is entitled to a credit; however, I find that credit should be based on the hours of care provided at the rates prescribed by the Schedule. To do otherwise would mean that Mr. Michalski and his children would receive less for the care they provided than they would be entitled to receive under the Schedule. I am unable to determine the amount of the credit from the evidence which was filed. I ask the parties to attempt to agree upon the amount of Wawanesa's credit and to make a joint submission of the amount within 30 days, failing which, I will receive further evidence and submissions on this point.

INTEREST

Mrs. Michalski claims interest on overdue attendant care benefits and housekeeping benefits under section 46(2) of the Schedule.

For the reasons given earlier, I find Mrs. Michalski applied for attendant care benefits, housekeeping benefits and a determination that she sustained a catastrophic impairment by November 18, 2001.

Housekeeping benefits are payable within 30 days after the insurer receives the application for the benefit pursuant to section 41 of the Schedule. Similarly, attendant care benefits are payable within 30 days after the insurer receives the application pursuant to section 39 of the Schedule. I find interest commences in relation to both benefits on December 18, 2001. Interest is to be paid at 2% per month, compounded monthly, pursuant to section 46(2) of the Schedule.

Assuming Wawanesa paid housekeeping expenses as agreed, I accept the Applicant's interest calculation in relation to the housekeeping benefits as $7,062.18. As my findings differ from the assumptions on which the attendant care benefit interest was calculated, the parties shall have 30 days to resolve the amount of interest and to make joint submissions as to the appropriate amount, failing which I will receive further evidence and submissions on this issue.

SPECIAL AWARD

Mrs. Michalski alleges that Wawanesa unreasonably withheld or delayed payment of attendant care benefits and housekeeping benefits and claims a special award at the maximum rate of 50%. Wawanesa submits that no special award is payable.

Law

Section 282(10) of the Insurance Act, requires an arbitrator to make a special award where he or she concludes that an insurer unreasonably withheld or delayed payment of benefits. That section gives an arbitrator the discretion with respect to the amount. Section 282(10) of the Act states:

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. R.S.O. 1990, c. I.8, s. 282 (10); 1993, c. 10, s. 1.

In Liberty Mutual Insurance Company and Persofsky (FSCO P00-00041, January 31, 2003), the Director of Arbitrations identified the following seven step approach to determining a special award:

1. Determine the benefits owing to the insured person, including interest calculated under the applicable version of the SABS

2. Decide whether the insurer unreasonably withheld or delayed the payment of these benefits. If so, the insurer will be ordered to pay a lump sum amount in addition to the benefits and interest calculated in #1

3. If the insurer did not act unreasonably in respect of all the benefits owing under #1, determine the amount of the benefits that were unreasonably withheld or delayed, and the interest payable on these benefits under the applicable version of the SABS.

4. Determine the maximum special award that can be awarded under s. 282(10), or at least a reasonable approximation. This is done by taking the amount in #1 or #3, whichever is applicable, and adding the additional interest component in s. 282(10) — two per cent per month, compounded monthly. To be clear, this calculation includes interest on the unpaid SABS interest. The maximum special award is 50 per cent of this total. Expressed as a formula, the calculation is as follows:

Maximum special award = 50% x (benefits that were unreasonably withheld or delayed + interest on these benefits calculated under the SABS + compound interest calculated according to s. 282(10))

5. Consider all relevant factors (discussed below) to determine an appropriate lump sum special award, not a percentage, that responds to the facts of the case and bears a reasonable relationship to other special awards, and does not exceed the maximum.

6. Provide reasons for concluding that the special award is payable, and for the amount of the award.

7. In the order, express the special award as a specific, lump sum amount. No interest is payable on this amount, except as part of the enforcement process.

In Persofsky, the Director of Arbitrations held a special award should be both rational — in the sense that the particular facts of the case are to be considered in the context of the underlying purposes of the legislation; and proportionate — in the sense that the consequences imposed on the insurer are rationally related to the misconduct at issue.

For the following reasons, I find Wawanesa unreasonably withheld and delayed the payment of Mrs. Michalski's attendant care benefits, throughout the period in question, in different ways, and a special award should be made. I also find that a special award should be made in relation to Mrs. Michalski's housekeeping benefits.

1. Section 32 non-compliance

The Legislature has imposed obligations on accident benefits insurers to inform claimants about benefit entitlement and process. Those obligations are set out in section 32 of the Schedule. Commencing in November 2001, Wawanesa disregarded its obligations under section 32 of the Schedule to identify the benefits to which Mrs. Michalski was entitled; provide her with a written explanation of the benefits available to her; and provide information to assist her in applying for benefits as required by sections 32(b) and (c) of the Schedule. Wawanesa also failed to inform Mrs. Michalski or her husband, that family members could be paid for their services, as part of its obligation under subsections 2(7), 32(b) and (c) of the Schedule. This had an impact on her claims for attendant care and housekeeping benefits.

Wawanesa knew that attendant care and housekeeping services were being provided by family members, and knew of the need for an enhanced level of attendant care benefits from the application for accident benefits and the documentation it received from its own assessors.

The purpose of section 32 of the Schedule is to ensure that claimants get access to benefits to which they may be entitled. When the insurer fails to identify benefits to which the claimant is entitled, claimants may never assert claims for benefits. This undermines the entire accident benefits scheme.

Arbitrators have consistently interpreted the insurer's section 32 obligation — to provide information to assist the insured person with claiming benefits — in light of the decision of the Supreme Court of Canada in Smith v. Co-operators General Insurance Co., [ 2002], S.C.R. 129.⁸I find that the Smith standard should also be applied to the insurer's obligation to inform the insured person of his or her entitlement to benefits.

I find that the information the insurer provides must be clear, accurate and timely. Sufficient information should be provided that the claimant is aware of the nature and extent of his or her entitlement to benefits, including the right to raise disputes. Insurers are not permitted to sit by and watch and wait and see if a claim is made — there is a positive duty to inform the claimant of entitlement.⁹ Insurers are not permitted to provide misinformation or take steps which prevent the claim from being submitted,¹⁰ to gratuitously deny a claim which has not been submitted, or prevent claims from crystallizing.¹¹

While Wawanesa identified Mrs. Michalski's attendant care need, it misinformed her of the amount of her entitlement, and misinformed her that the amount of her benefit was insufficient to cover the cost of her care. Wawanesa failed to identify her entitlement to housekeeping benefits.

As a result of Wawanesa's failures and misinformation, Mrs. Michalski did not assert her entitlement to be paid for the attendant care services or the housekeeping services her family members provided for years. Wawanesa thus both withheld and delayed attendant care and housekeeping benefits. I find Wawanesa effected the withholding of benefits by failing to comply with the requirements of the Schedule. In my view, non-compliance with provisions of the Schedule is unreasonable on its face.

I find that in November 2001, there were potential disputes as to whether: Mrs. Michalski sustained a catastrophic impairment; was entitled to a higher level of care; was entitled to a higher number of hours of care; and disputes as to whether her husband and their children were entitled to be paid for their services for attendant care and housekeeping. However, Wawanesa's claims handling prevented those disputes from crystallizing at that time. It was not until Mr. Michalski retained counsel in July 2002 that those disputes began to emerge.

This is not the way the Schedule is supposed to work. Despite the complexity of the Schedule, insured persons should not be required to retain counsel to find out which benefits they are entitled to claim, or to learn how to gain access to enhanced statutory accident benefits, as happened in this case.

Some of the events which may flow from the absence of information are not repairable by a later payment of benefits. For example, Sandra and Michael, Mr. and Mrs. Michalski's children, were aged 10 and 13 at the time of the accident. As a result of the injuries Mrs. Michalski sustained in the motor vehicle accident, Sandra and Michael lost their mother's care and guidance. At the same time, they had the responsibility thrust on them for her care.

At one point in his testimony, Mr. Michalski stated quietly that his children "had lost their childhood." I found Mr. Michalski to be a credible witness, given to understatement, and I accept his observation concerning the loss his children suffered as a result of caring for their mother. How can that be repaired by payment of late payment of benefits? This burden was unnecessary, had Wawanesa met its obligations.

Mr. Michalski was working a 40 hour week outside the home at the time of the accident. After the accident, he took on the responsibility for the children, meal preparation, housework, as well as the care of his wife. All this at a time when, according to Dr. Dobrowolski, Mr. Michalski was "still in a grieving mode" in relation to the loss of his wife as he had known her. I accept that given the family's circumstances and Wawanesa's failure to meet its obligations, pressing the children into service was a necessary response in order to meet Mrs. Michalski's needs for attendant care.

Attendant care benefits ensure that a claimant's needs for care and safety are met following an accident. Wawanesa's response to Mrs. Michalski's attendant care needs was to misinform her of her entitlement, arrange insurer examinations, and arrange for the provision and payment of a portion of the hours of care which the Insurer's assessors concluded were reasonable.

As I accept that the family members ensured that 24 hour care was provided 7 days a week, this meant that at the beginning of the period in question, Wawanesa was paying third parties 40 hours per week of care, while allowing Mrs. Michalski's husband and their children to provide the remaining 128 hours of care per week without any compensation. As time went on, Wawanesa reduced the number of hours it was prepared to pay for Mrs. Michalski's care, and consequently, the number of unpaid hours the family members provided increased.

Housekeeping and home maintenance benefits provide for the tidying, cleaning, upkeep and maintenance of the home, necessary for a safe and comfortable home environment. These benefits also provide for such necessary services as shopping, meal preparation, doing dishes and laundry, for the insured person and other members of the household. The need for these services for Mrs. Michalski and her family was apparent from the documentation in Wawanesa's possession.

Since Wawanesa failed to identify that Mrs. Michalski was entitled to housekeeping benefits when she applied for them, knew Mr. Michalski was providing housekeeping and homemaking services and failed to tell Mrs. Michalski that she could be compensated for his services, I find that Mrs. Michalski is also entitled to a special award in relation to housekeeping benefits.

Wawanesa's non-compliance with section 32 of the Schedule in relation to Mrs. Michalski's application to determine that she sustained a catastrophic impairment has been dealt with earlier in the decision at pages 8 - 11.

2. Section 39 non-compliance

Section 39 of the Schedule deals with the attendant care process. The attendant care DAC process makes provision for neutral assessments if the claim is not accepted at the outset; at each point the insurer seeks to reduce these benefits; and when the insured claims a higher level of benefit. Attendant care DACs thus create a safety net. They ensure that attendant care benefits are not refused, reduced or terminated arbitrarily without a neutral assessment. Wawanesa circumvented all of these legislated safeguards and delayed Mrs. Michalski from obtaining a neutral assessment of her needs for attendant care.

Wawanesa failed to comply with its obligations to arrange attendant care DACs on at least four successive occasions during the period in question: once at the beginning of her claim, on two or more occasions when it reduced the amount of the paid attendant care, and when Mrs. Michalski sought an increase in attendant care benefits.¹²

Even when counsel for the Applicant brought the attendant care DAC provisions to Wawanesa's attention, in November 2002, and again in April 2003, Wawanesa did not take steps to arrange an attendant care DAC. The motor vehicle accident occurred in October 2001. It was not until November 2003, that Wawanesa proposed the first and only attendant care DAC in relation to Mrs. Michalski's care.

I find the basis on which Wawanesa reduced Mrs. Michalski's attendant care benefits was unreasonable commencing in March 2002. I make this finding because the reductions were based on "partial" assessments in which the assessors were wilfully blind, done in an arbitrary manner, without the benefit of attendant care DACs, in contravention of the Schedule. Further, the manner in which the reductions was effected was not evenhanded. The reductions were always effected by lopping off the paid care; never the care the family members provided without receiving payment.

I find Wawanesa's actions from the inception of the claim to the date of the hearing bear little resemblance to the attendant care process set out in section 39 of the Schedule. I find Wawanesa's failure to provide Mrs. Michalski with neutral assessments of her attendant care needs compounded its earlier failures in relation to section 32 of the Schedule.

Pay pending dispute

The Applicant submits that once she provided Wawanesa with her own assessment of her attendant care needs in 2003, Wawanesa was obliged to pay her $6,000 per month, pending the DAC assessment received in September 2004. Had Mrs. Michalski provided such a report at the outset of the claim, I agree that Wawanesa would have been obliged to pay $6,000 pending resolution of the dispute.

One interpretation, which gives Wawanesa the full benefit of its own non-compliance, is that since Wawanesa was already paying a monthly benefit, apparently of $1,568, and the Applicant was seeking an increase in the amount of attendant care, Wawanesa was only obliged under section 39(9) of the Schedule, to continue to pay the existing benefit of $1,568 pending the DAC report. In the circumstances, I do not base the special award on a failure to pay attendant care benefits pending the DAC assessment.

Pursuant to an interim agreement, made without prejudice to the rights of either party, Wawanesa did increase the amount it paid for attendant care to $3,000, and paid a lump sum to reflect $3,000 in monthly care from the date Mrs. Michalski was discharged from hospital, October 31, 2001.

3. Section 40 non-compliance

The particulars of Wawanesa's non-compliance with its obligations under section 32 and section 40 of the Schedule, have already been detailed at pages 8-11 of this decision.

4. Sound and moderate judgment

In Plowright and Wellington Insurance Company (OIC No. A-003985 October 29, 1993), Arbitrator Palmer held that the standard expected of an insurer's examiner and supervisors in adjusting a claim is one of sound and moderate judgment.

Wawanesa failed to adduce evidence as to its reasons for various actions and failings in this case. I find Wawanesa failed to act with sound and moderate judgment when it relied on the opinions of the occupational therapists and the case manager which were wilfully blind.

Wawanesa did not produce a file handler to explain whether it reconsidered its position after receiving the reports of Drs. Kuiack and Mount, the psychologist and psychiatrist who assessed Mrs. Michalski at Wawanesa's request in January 2003. If it did, I do not know why Wawanesa preferred the opinions of the occupational therapists and the case manager, flawed and deficient as they were, to the opinions of its own psychiatrist and psychologist, whose greater expertise in assessing Mrs. Michalski's cognitive function Wawanesa sought. I find Wawanesa failed to act with sound and moderate judgment in reassessing evidence from its own assessors. I find Wawanesa's actions and defaults overlap and compound each other.

Wawanesa's submissions

Wawanesa submits that the blame for the unfortunate manner in which this claim unfolded rests with Mr. and Mrs. Michalski. Wawanesa submits that Mr. Michalski failed to return applications for attendant care expenses on two occasions, therefore, it was unable to assess the amount of Mrs. Michalski's entitlement, and the DAC process under the Schedule did not unfold as it should have.¹³ I do not find either submission persuasive.

Logically, an insured person must first know that he is entitled to make a claim before he can make one. I also make this finding because of drafting conventions¹⁴, as a matter of purposive interpretation,¹⁵ and because of the consumer protection scope of the legislation.¹⁶

Mr. Michalski testified that he did not know and was never told that he and his children could be paid for the attendant care and housekeeping services they provided. He testified that he was not informed of this by Wawanesa, by the case manager, or by any of the occupational therapists Wawanesa retained. He knew Wawanesa would pay third parties who provided attendant care and housekeeping services; not family members. Mr. Michalski testified that until he retained counsel in 2002, he was unaware that his wife could claim payment. Wawanesa adduced no evidence to the contrary. I accept Mr. Michalski's evidence.

Wawanesa wrote Mr. Michalski that the cost of his wife's care exceeded the amount of the monthly attendant care benefit by $683 per month. The provision of expenses forms would be unlikely to prompt any claim or inquiry on Mr. Michalski's part, because, based on the misinformation from Wawanesa, any claim would only serve to deprive his wife of attendant care during the day while he was away at work. In these circumstances, I am not persuaded that Mr. Michalski can be faulted for not submitting an expenses form for attendant care services he and his children provided.

The second occasion on which Wawanesa provided expense forms was after Mr. Michalski retained counsel. Counsel submitted the Applicant's assessment of her attendant care needs which stated that Mrs. Michalski required 24 hour a day care. In response to her claim for a higher level of attendant care benefits, the adjuster wrote: "An Application for Expenses is required for the Insurer to determine whether Attendant Care Expenses, over the $1,568 per month are payable. The Application should detail the type of service being provided, time spent and hours of the day for the service, the identity of the service provider and the amount being claimed for the service performed. Any receipts should be submitted with the Application."

At this point, Wawanesa had a Form 1, the Applicant's attendant care assessment, and Dr. Dobrowolski's support for increased attendant care. At this juncture, section 39 of the Schedule obliges an insurer to arrange an attendant care DAC. I find the completion of an application for expenses was not required to determine whether attendant care expenses over $1,568 per month were payable. Wawanesa requested a further insurer's examination, but only proposed an attendant care DAC assessment in November 2003.

The attendant care benefit belongs to Mrs. Michalski. What Wawanesa was entitled to assess by way of an attendant care DAC, was the amount of her entitlement; not the amount Mr. Michalski or their children were entitled to be paid. It matters not who provides those services, so long as they are provided. Wawanesa's assessments by occupational therapists document the provision of attendant care services by Mr. Michalski, Michael and Sandra.

Wawanesa submitted that Mr. Michalski's failure to return the applications for expenses led to its failure to arrange a DAC. However, Wawanesa felt that it had sufficient information to arrange several section 42 assessments with respect to Mrs. Michalski's attendant care. An insurer's right to such assessments under section 42 of this Schedule only arises where a person is asserting a claim for a benefit. If Wawanesa concluded that a claim was being made for purposes of a section 42 assessment, then it was inconsistent for Wawanesa to assert at the same time that it was not a claim for purposes of arranging DAC assessment.

The expenses form is not a prescribed form which must be used by persons who seek to claim expenses. In such circumstances, "the focus of the analysis is not the form in which the information is provided, but the adequacy of that information and whether it is sufficient to allow the insurer to process and assess the claim."¹⁷

I find that with the exception of the amount being claimed for services provided by Mr. Michalski and his children, all the information requested in the expenses claim form was in Wawanesa's possession. It was contained in the original application for accident benefits, the reports from the case manager and from the occupational therapists.

Eventually, in about March 2004, Mr. Michalski provided Wawanesa with a list of the attendant care and housekeeping services performed in relation to his wife as part of an interim agreement. I find the only items on that list which had not previously been identified to Wawanesa, were feeding the cat and cleaning the cat's litter box. I find these items do not relate to the provision of attendant care.

I find Wawanesa knew the number of hours it was paying for attendant care, knew that the family members were providing the balance of Mrs. Michalski's care, and that under the Schedule, attendant care services are payable at only three rates —seven, nine or fifteen dollars per hour. Although it may not have resolved the dispute, I find a financial response was possible based on a mathematical calculation using its own assessments.

I find the blame for the unfortunate manner in which this claim unfolded rests squarely on Wawanesa's shoulders. I find Wawanesa's attempt to blame Mr. and Mrs. Michalski shows no recognition by Wawanesa of the problem which it created. In my view, that suggests that a higher special award is required.

Wawanesa submitted that it was sheltered from a special award because it paid Mrs. Michalski's attendant care benefits on the basis of the Form 1s from Wawanesa's occupational therapy assessments. I am not persuaded that Wawanesa has established that it did pay in accordance with the Form 1s. Rather, the evidence suggests that Wawanesa paid for fewer hours and at higher rates than were contemplated in its own assessments and Form 1s between November 2001 and July 2002. These arrangements were directed by the case manager, who I find was acting as Wawanesa's agent.

I am also not persuaded that an insurer is sheltered by reports which articulate that the authors are being wilfully blind. Insurers have been sheltered from special awards where they rely on an opinion as to medical condition or disability which supports their position, and which the arbitrator subsequently rejects. That is because medicine remains both an art and a science, and there may be legitimate differences amongst experts in relation to a diagnosis, how much pain is too much, questions of causation, etc. In many cases of soft tissue injury there are no objective signs, and the expert is relying on a history, symptoms, knowledge of the condition, knowledge of the patient, the presentation of the patient, as well as the examiner's skill and judgment. In my view, such shelter is not afforded to an insurer where an opinion is erroneous and unsound because the assessor is wilfully blind and this is apparent from the reports.

The amount of the special award

In Persofsky, the Director of Arbitrations held that the award should be proportionate to the blameworthiness of the insurer's conduct; the vulnerability of the insured person; the harm or potential harm directed at the insured person; the need for deterrence; the advantage wrongfully gained by the insurer from the misconduct; and should take into account any other penalties or sanctions that have been or likely will be imposed on the insurer due to its misconduct. On these measures, I find a special award at the high end of the scale should be imposed in the circumstances of this case. I find Wawanesa failed to comply with its obligations under sections 32, 39 and 40 of the Schedule. Those sections deal with important obligations. The breaches in this case are significant ones. The motor vehicle accident in which Mrs. Michalski was injured took place in 2001. The applicable legislation took effect in 1996.This was not new legislation.

But for Mr. Michalski's persistence and retaining counsel, Mrs. Michalski's claims were likely to have simply petered out. But for the services Mr. Michalski, his children and Ms. Wdowikowski provided, Mrs. Michalski's needs would not have been met. In the absence of a supportive family, I find Mrs. Michalski would have been at significant risk to her health and safety.

I believe the sanction should reflect that Wawanesa failed to meet its contractual obligations, and is entirely to blame for the manner in which this claim unfolded. I agree with the submission of counsel for the Applicant that it is difficult to find a more vulnerable Applicant than Mrs. Michalski, who, as a result of her injuries, functions like a two year old, was unrepresented by counsel and whose primary language was not English. She could not be safely left alone. Wawanesa repeatedly put her at risk. Fortunately, her husband and children provided her with care. I believe the award should also reflect that Wawanesa took advantage of Mrs. Michalski's children, and should encompass the need to deter Wawanesa and other insurers from engaging in similar conduct. Nothing indicates that Wawanesa is likely to be subjected to any additional penalty as a result of its misconduct. I agree with the view that interest is remedial — not a penalty.

Mitigating factors are that Wawanesa responded promptly to Mrs. Michalski's claim and hired a case manager, provided some assistance by way of paid attendant care, and increased the amount of her attendant care benefit pending the agreed upon DAC assessment. Aggravating factors are the degree of Mrs. Michalski's vulnerability, the impact on her children, the number and persistence of Wawanesa's breaches, their compounding effect, and blaming Mr. Michalski.

In Henderson and Lombard General Insurance Company of Canada (FSCO A97-001019, March 31, 2000), Arbitrator Sampliner held that Lombard failed to send Mr. Henderson claim forms and information about accident benefits, neglected its duty to evaluate and respond to his claims, delayed answering queries, misstated the limitation period, and refused to change its position when the law changed. The arbitrator held that Lombard's failures of duty caused or significantly contributed to the unreasonable delay and withholding of Mr. Henderson's accident benefits from the time he initially contacted the company in November 1994 to the date of the hearing. Although Lombard eventually made payments of benefits, Arbitrator Sampliner made an award of $65,000, which on a percentage basis was approximately 40%. This award was upheld on appeal.

In Singh and Commercial Union (FSCO A99-001160, September 11, 2001), Arbitrator Miller made a special award of 50%. She concluded that the insurer's conduct was unreasonable because it terminated Mrs. Singh's income replacement benefits without meaningful medical evidence on which to base its termination, refused to adjust the amount of her benefit although it had the information to do so, and it refused to re-evaluate or adjust its position.

The arbitrator found that Mrs. Singh was the sole income earner in the family, that Commercial Union's actions created a great deal of harm, frustration, and financial hardship for the Applicant and her family. The eldest son, a high school student, had to obtain employment to help support the family, was admitted to a psychiatric facility for depression and dropped out of high school. The insurer paid Mrs. Singh's benefits shortly before the hearing. On appeal the special award of 50% was upheld.

These cases suggest that a special award at the high end of the scale is appropriate in the circumstances of this case. In Persofsky, the Director of Arbitrations held that it is inappropriate to order a special award expressed as a percentage of benefits owing, plus interest, without also considering whether the amount when quantified was appropriate.

I am unable to quantify the special award at this time without the credit on attendant care benefits and the interest calculation. For that reason, I make a special award in relation to the attendant care and housekeeping benefits, in favour of Mrs. Michalski, in an amount to be determined, once I am provided with the attendant care benefit credit and interest calculations.

EXPENSES:

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

December 13, 2005

Suesan Alves Arbitrator

Date

Neutral Citation: 2005 ONFSCDRS 172

FSCO A03-001363

BETWEEN:

MARIA MICHALSKI by her guardian KRZYSZTOF MICHALSKI

Applicant

and

WAWANESA MUTUAL INSURANCE COMPANY

Insurer

ARBITRATION ORDER

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

1. Wawanesa Mutual Insurance Company shall pay Maria Michalski attendant care benefits in the amount of $178,928.33, less a credit in an amount to be determined.

2. Wawanesa Mutual Insurance Company shall pay Maria Michalski interest on attendant care benefits in an amount to be determined.

3. Wawanesa Mutual Insurance Company shall pay Maria Michalski interest on housekeeping benefits in the amount of $7,062.18 pursuant to section 46(2) of the Schedule.

4. Wawanesa Mutual Insurance Company shall pay Maria Michalski a special award in relation to attendant care benefits and housekeeping benefits in an amount to be determined.

5. The parties shall have 30 days to resolve the issues of the amount of Wawanesa's credit for attendant care benefits, interest on attendant care benefits and to make a joint submission in relation to these amounts, failing which I will receive further evidence and submissions on these issues. I remain seized of these issues, and of the amount of thespecial award.

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

December 13, 2005

Suesan Alves Arbitrator

Date

Appendix A

Section 2 (1)....

"catastrophic impairment" means,

(a) paraplegia or quadriplegia,

(b) amputation or other impairment causing the total and permanent loss of use of both arms,

(c) amputation or other impairment causing the total and permanent loss of use of both an arm and a leg,

(d) total loss of vision in both eyes,

(e) brain impairment that, in respect of an accident, results in,

(i) a score of 9 or less on the Glasgow Coma Scale, as published in Jennett, B. and Teasdale, G., Management of Head Injuries, Contemporary Neurology Series, Volume 20, F.A. Davis Company, Philadelphia, 1981, according to a test administered within a reasonable period of time after the accident by a person trained for that purpose, or

(ii) a score of 2 (vegetative) or 3 (severe disability) on the Glasgow Outcome Scale, as published in Jennett, B. and Bond, M., Assessment of Outcome After Severe Brain Damage, Lancet i:480, 1975, according to a test administered more than six months after the accident by a person trained for that purpose,

(f) subject to subsections (2) and (3), any impairment or combination of impairments that, in accordance with the American Medical Association's Guides to the Evaluation of Permanent Impairment, 4th edition, 1993, results in 55 per cent or more impairment of the whole person, or

(g) subject to subsections (2) and (3), any impairment that, in accordance with the American Medical Association's Guides to the Evaluation of Permanent Impairment, 4th edition, 1993, results in a class 4 impairment (marked impairment) or class 5 impairment (extreme impairment) due to mental or behavioural disorder;

(2) Clauses (f) and (g) of the definition of "catastrophic impairment" in subsection (1) do not apply in respect of an insured person who sustains an impairment as a result of an accident unless,

(a) the insured person's health practitioner states in writing that the insured person's condition has stabilized and is not likely to improve with treatment; or

(b) three years have elapsed since the accident.

(3) For the purpose of clauses (f) and (g) of the definition of "catastrophic impairment" in subsection (1), an impairment that is sustained by an insured person but is not listed in the American Medical Association's Guides to the Evaluation of Permanent Impairment, 4th edition, 1993 shall be deemed to be the impairment that is listed in that document and that is most analogous to the impairment sustained by the insured person.

(7) For the purpose of this Regulation, an aide or attendant for a person includes a family member or friend who acts as the person's aide or attendant, even if the family member or friend does not possess any special qualifications."

Attendant Care Benefit

16.(1) The insurer shall pay an insured person who sustains an impairment as a result of an accident an attendant care benefit.

(2) The attendant care benefit shall pay for all reasonable and necessary expenses incurred by or on behalf of the insured person as a result of the accident for,

(a) services provided by an aide or attendant; or

(b) services provided by a long-term care facility, including a nursing home, home for the aged or chronic care hospital.

(3) Subsection (2) does not apply to expenses for which payment may be obtained under clause 14 (2) (g), 15 (5) (k) or 24 (1) (c).

(4) The monthly amount payable by the attendant care benefit shall be determined in accordance with Form 1.

(5) The amount of the attendant care benefit payable in respect of an insured person shall not exceed,

(a) $3,000 per month, in the case of an insured person who did not sustain a catastrophic impairment as a result of the accident; or

(b) $6,000 per month, in the case of an insured person who sustained a catastrophic impairment as a result of the accident.

Case Manager Services

17.(1) If an insured person sustains a catastrophic impairment as a result of an accident, the insurer shall pay for all reasonable and necessary expenses incurred by or on behalf of the insured person as a result of the accident for services provided, in accordance with a treatment plan, by a qualified case manager.

(2) The insurer is not liable under subsection (1) to pay for expenses related to professional services rendered to an insured person that exceed the maximum rate or amount of expenses established under the Professional Fees Guidelines published in The Ontario Gazette by the Ontario Insurance Commission, as they may be amended from time to time.

Section 32 of the Schedule states:

32.(1) A person who wants to apply for a benefit under this Regulation shall notify the insurer within 30 days after the circumstances arose that gave rise to the entitlement to the benefit, or as soon as practicable thereafter.

(2) The insurer shall promptly provide the person with,

(a) the appropriate application forms;

(b) a written explanation of the benefits available under this Regulation;

(c) information to assist the person in applying for benefits; and

(d) information on any possible elections relating to income replacement, non-earner and caregiver benefits.

(3) The person shall submit an application for the benefit to the insurer within 30 days after receiving the application forms.

(4) If a person is required by an insurer to submit an additional application in respect of a benefit that the person is receiving or may be eligible to receive, the person shall submit the additional application to the insurer within 30 days after receiving the additional application forms from the insurer.

Section 39 of the Schedule states:

39.(1) Within 14 days after receiving an application for an attendant care benefit, an insurer shall,

(a) give the insured person notice that it has approved the application, if the insurer determines that it is required to pay for the expenses described in the application; or

(b) give the insured person notice that the insurer requires the insured person to furnish an assessment of attendant care needs in Form 1 prepared by a member of a health profession who is authorized by law to treat the persons impairment. O. Reg. 403/96, s. 39 (1); O. Reg. 281/03, s. 18 (1).

(2) If the application is for an attendant care benefit in respect of expenses that are of a continuing nature, the insurer may require an assessment of attendant care needs described in clause (1) (b) to be furnished as often as is reasonably necessary. O. Reg. 403/96, s. 39 (2); O. Reg. 281/03, s.8 (2).

(3) If the insurer is required to pay the benefit, it shall begin payment of the benefit within 30 days after receiving the application or, if the insurer has required an assessment of attendant care needs in Form 1, within 14 days after receiving Form 1. O. Reg. 281/03, s. 18 (3).

(4) If the insurer determines that an insured person is not entitled to receive an attendant care benefit, the insurer shall require the person to undergo a designated assessment in accordance with section 43 and shall give the person notice of its determination and the requirement for the designated assessment, with reasons,

(a) within 14 days after receiving the application; or

(b) within 14 days after receiving the assessment of attendant care needs in Form 1, if the insurer required an assessment of attendant care needs under this section. O. Reg. 281/03, s. 18 (3).

(5) Revoked: O. Reg. 281/03, s. 18 (3).

(6) If a designated assessment is required under subsection (4), the insurer shall pay the insured person the attendant care benefit pending receipt of the report of the designated assessment centre. O. Reg. 403/96, s. 39 (6); O. Reg. 281/03, s. 18 (4).

(7) If an insured person is receiving an attendant care benefit and the insurer determines that the person is no longer entitled to receive the benefit or that the amount of the benefit should be reduced, the insurer shall require the person to undergo a designated assessment in accordance with section 43 and shall give the person notice of its determination and the requirement for the designated assessment, with reasons, no later than the date the next payment of the benefit is due. O. Reg. 281/03, s. 18 (5).

(8) If an insured person who is receiving an attendant care benefit submits an application to the insurer to increase the amount of the benefit, and the insurer determines that the person is not entitled to receive an increased amount, the insurer shall require the person to undergo a designated assessment in accordance with section 43 and shall give the person notice of its determination and the requirement for the designated assessment, with reasons, within 14 days after the application is received. O. Reg. 281/03, s. 18 (5).

(9) If a designated assessment is required under subsection (7) or (8), the insurer shall, pending receipt of the report of the designated assessment centre, continue to pay the insured person the attendant care benefit in the amount that was being paid before the notice under that subsection was given. O. Reg. 281/03, s. 18 (5).

(10) The determination by the designated assessment centre is binding on the insured person and the insurer in respect of the attendant care benefit, subject to the determination of a dispute in accordance with sections 279 to 283 of the Act. O. Reg. 281/03, s. 18 (5).

(11) Despite subsections (7) and (8), if more than 104 weeks have elapsed since the accident, the insurer shall not require a designated assessment of the insured person and the insured person shall not submit an application to the insurer to increase the amount of the benefit unless at least 52 weeks have elapsed since the insured person was last assessed by a designated assessment centre. O. Reg. 281/03, s. 18 (5).

(12) The insured person and the insurer may agree at any time that the insured person be assessed in accordance with section 43. O. Reg. 281/03, s. 18 (5).

(13) If the insurer determines that, pursuant to subsection 18 (2), a person is not entitled to receive an attendant care benefit,

(a) subsections (4), (7), (8) and (11) do not apply; and

(b) if the insurer has been paying an attendant care benefit to the person, the insurer shall not stop payment of the benefit unless it gives the person notice of its determination, with reasons, at least 14 days before the last payment of the benefit. O. Reg. 281/03, s. 18 (5).

Section 40 states:

Determination of Catastrophic Impairment

40.(1) An insured person who sustains an impairment as a result of an accident may apply to the insurer for a determination of whether the impairment is a catastrophic impairment. O. Reg. 403/96, s. 40 (1).

(2) The insurer shall, within 30 days after it receives the application,

(a) determine that the impairment is a catastrophic impairment and give the insured person notice of the determination;

(b) determine that the impairment is not a catastrophic impairment and give the insured person notice of the determination, including the reasons for the determination; or

(c) give the insured person notice that the insurer requires the insured person to be assessed by a designated assessment centre in accordance with section 43. O. Reg. 403/96, s. 40 (2).

(3) If the insured person receives a notice under clause (2) (b) and the insured person disputes the insurer's determination, the insured person may require that he or she be assessed by a designated assessment centre in accordance with section 43. O. Reg. 403/96, s. 40 (3).

(3.1) Despite clause 19 (2) (a), if an application under subsection (1) is made within 104 weeks after the accident and a designated assessment is required under this section, the insurer shall continue to pay the insured person the attendant care benefit in the amount that was being paid before the notice under clause (2) (c) or subsection (3) was given, pending receipt of the report from the designated assessment centre. O. Reg. 281/03, s. 19.

(4) The determination by the designated assessment centre is binding on the insured person and the insurer, subject to the determination of a dispute, in accordance with sections 279 to 283 of the Insurance Act, relating to whether the impairment is a catastrophic impairment. O. Reg. 403/96, s. 40 (4).

Section 43 of the Schedule states:

Assessments

43.(1) If an assessment is required to be conducted by a designated assessment centre,

(a) the insurer shall, within 15 days, notify the designated assessment centre; and

(b) the designated assessment centre shall promptly notify the insured person and arrange for the assessment.

(2) For the purpose of the assessment,

(a) the insured person and the insurer shall provide the person or persons who conduct the assessment with such information as is reasonably necessary; and

(b) the insured person shall submit to any reasonable physical, psychological, mental and functional examinations requested by the person or persons who conduct the assessment.

(3) If an insured person does not make himself or herself reasonably available for an assessment or fails to comply with subsection (2),

(a) the insurer may stop payment of the benefit related to the assessment until the person submits to the assessment or complies with subsection (2), after which time the insurer shall resume payment of the benefit; and

(b) no benefit is payable for the period after the insured person failed to make himself or herself reasonably available or failed to comply with subsection (2) and before the insured person makes himself or herself reasonably available and complies with subsection (2).

(4) After conducting the assessment, the person or persons who conducted the assessment shall prepare a report and provide a copy of the report to,

(a) the insurer;

(b) the insured person; and

(c) the insured person's health practitioner.

(5) If the assessment is required under section 37 in respect of a claim for an income replacement, non-earner or caregiver benefit, the report shall include a statement as to whether the insured person continues to suffer from the disability in respect of which the benefit is being paid.

(6) If the assessment is required under section 38 in respect of a claim for a medical or rehabilitation benefit, the report shall include,

(a) a statement of whether, in the opinion of the person or persons who conducted the assessment, an expense in respect of the benefit is reasonable and necessary for the insured person's treatment or rehabilitation; and

(b) recommendations on the future provision of goods and services to the insured person for his or her treatment or rehabilitation.

(7) If the assessment is required under section 39 in respect of a claim for an attendant care benefit, the report shall include,

(a) a determination in accordance with Form 1 of the amount to be paid by the insurer for the future provision of attendant care services; and

(b) recommendations on the future provision of attendant care services to the insured person.

(8) If the assessment is required under section 40 to determine whether an impairment is a catastrophic impairment, the report shall include a statement of whether, in the opinion of the person or persons who conducted the assessment, the impairment is a catastrophic impairment.

Overdue Payments

46.(1) An amount payable in respect of a benefit is overdue if the insurer fails to pay the benefit within the time required under this Part.

(2) If payment of a benefit under this Regulation is overdue, the insurer shall pay interest on the overdue amount for each day the amount is overdue from the date the amount became overdue at the rate of 2 per cent per month compounded monthly.

Footnotes

1. 1The Statutory Accident Benefits Schedule — Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.
2. 2Judgment of Browne, J. dated April 22, 2003
3. 3Section 17(1) states "If an insured person sustains a catastrophic impairment as a result of an accident, the insurer shall pay for all reasonable and necessary expenses incurred by or on behalf of the insured person as a result of the accident for services provided, in accordance with a treatment plan, by a qualified case manager." Similarly, the expressions sustain(s) or sustained a catastrophic impairment is used in sections 16(5)(a), 16(5)(b) with respect to attendant care benefits, and 17(1)with respect to case manager services, 18(3) with respect to the duration of medical, rehabilitation and attendant care benefits, subsections 19(1)(b) and 19 (2)(b) with respect to the amount of medical rehabilitation and attendant care benefits, 21(3) with respect to expenses of visitors, in section 22(4) with respect to housekeeping and home maintenance benefits, 27(1)3.i.B. with respect to optional benefits, section 40(1) with respect to the determination of catastrophic impairment, and section 70(3) with respect to transitional provisions for persons who do not sustain a catastrophic impairment. The words determine or determination whether the impairment is catastrophic, are only used in sections 40(1), 40(2)(a) and (b), 40(4), 43(7)(a) and 43(8) of the Schedule. Section 40 deals with the determination of catastrophic impairment and section 43 with the content of the CAT DAC report.
4. 4Report to counsel for the Applicant dated May 9, 2003
5. 5Ms. Currado reported her observations in relation to aspects of a gross mental status examination, — perhaps implying that the cognitive problem was no longer an issue. It is important to appreciate that the fact a person fails a gross mental status examination is evidence of a significant deficit in mental functioning. However, the fact that someone passes aspects of such an examination — based as it is on material that most people have learned, if not overlearned — is not by itself evidence of normal cognitive function.
6. 6Sansregret v. The Queen, 1985 CanLII 79 (SCC), [1985] 1 SCR 570, (S. C. C.)
7. 7Twenty four hours of care at the lowest rate under the Schedule yields a monthly rate of $5,092.08 (24 hours x $7.00 per hr. x 7 days per week x 4.33 weeks per month)
8. 8In Smith, the Court dealt with the question of whether the insurer discharged its obligation to provide information about the processes for resolving disputes, under section 71 of the Schedule. Gonthier, J., writing for the majority, stated: In my opinion, the insurer is required under s. 71 to inform the person of the dispute resolution process contained in ss. 279 to 283 of the Insurance Act in straightforward and clear language, directed towards an unsophisticated person. At a minimum, this should include a description of the most important points of the process, such as the right to seek mediation, the right to arbitrate or litigate if mediation fails, that mediation must be attempted before resorting to arbitration or litigation and the relevant time limits that govern the entire process. Without this basic information, it cannot be said that a valid refusal has been given.
9. 9Persofsky and Liberty Mutual Insurance Company (FSCO A99-000598 June 23, 2000)
10. 10Stargratt and Zurich Insurance Company of Canada (FSCO A99-000521, October 4, 2001)
11. 11Ross and the TTC Insurance Company Limited (FSCO A01-000064 April 5, 2002)
12. 12According to the Form 1s, attendant care was reduced to 10.14 hours on March 6, 2002, to 7.5 hours on March 27, 2002 and to 5.13 hours on July 5, 2002. The July 10, 2002 reduction to 2.47 hours per week is stated to be in error. According to the case manager's reports attendant care was initially 8 hours, reduced to 6 hours in May 2002, and to 3 hours in July, 2002. I am unable to determine the number of hours paid from the list of attendant care payments, as the levels of care were not provided. It appears that different rates may have been paid to the attendant caregivers.
13. 13If Wawanesa was referring to a CAT DAC, I find no relationship between the expenses claim form and Wawanesa's obligation to inform Mrs. Michalski that it had determined that she was catastrophically impaired, or, alternatively to inform her that she could seek a CAT DAC and provide her with the necessary forms so that it could arrange a CAT DAC.
14. 14Appendix I, Drafting Conventions of the Uniform Law Conference of Canada s. 22 "A section should deal with a single idea or with a group of closely related ideas." in Sullivan, R., Driedger on the Construction of Statutes Third edition 1994 Toronto and Vancouver : Butterworths.
15. 15In the case of Canadian Surety Company and Sebastian, (FSCO P96-00032, July 28, 1998), Director's Delegate Naylor described "the system's fundamental goal" as "ensuring prompt payment of benefits for an injured person's medical and vocational rehabilitation, their care or their day-to-day financial support." In the case of Graper and Liberty Mutual Insurance Company (FSCO A00-000133, July 20, 2001), Arbitrator Makepeace held "What the Act and accident benefits schedules do indicate is the legislature's intent that first-party accident benefits be paid promptly through a non-adversarial process."
16. 16Smith and Co-operators, op.cit. Arbitrators have held that where the insurer is obliged to inform the claimant of time limits for submitting a claim for benefits, and fails to do so, the claimant will not be prevented from claiming benefits due to non-compliance with the time limits in subsection 32(3). Thus, the insured's obligations are interrelated with the insurer's compliance with its obligations. I find a similar interrelationship exists between an insurer's obligations under subsection 32(b) and (c) of the Schedule — to provide a written explanation of benefits available under the Schedule and information to assist the person in applying for benefits — and the insured's obligation to file subsequent applications under subsection 32(4) of the Schedule.
17. 17Mcintosh and Allstate Insurance Company of Canada (FSCO A02-001277, April 23, 2004), confirmed on appeal (FSCO P04-00019, March 15, 2005).