Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2006 ONFSCDRS 146

Appeal P06-00004

OFFICE OF THE DIRECTOR OF ARBITRATIONS

PILOT INSURANCE COMPANY

Appellant

and

Ms. G

Respondent

Before:

Nancy Makepeace

Representatives:

William G. Scott for Pilot

M. Steven Rastin for Ms. G

Hearing Date:

April 21, 2006

Written submissions completed on May 5, 2006

APPEAL ORDER

Under section 283 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:

1. The appeal is allowed and the arbitrator's order of December 22, 2005 is revoked.

2. If the parties are unable to agree on appeal expenses, a hearing may be requested in accordance with Rule 79 of the Dispute Resolution Practice Code.

August 28, 2006

Nancy Makepeace

Director's Delegate

Date

REASONS FOR DECISION

I. NATURE OF THE APPEAL

This appeal concerns a narrow legal issue: whether nanny expenses¹ may be recovered as a rehabilitation benefit under s. 15(5)(l) of the SABS-1996.² The insurer appeals from the arbitrator's interim order that it pay Ms. G's nanny expenses of $2,267 per month in accordance with the March 11, 2005 report of the designated assessment centre ("DAC").

For the following reasons, I find the arbitrator erred in law.

II. BACKGROUND

A. The Issue in Dispute

Ms. G was injured in an automobile accident on August 20, 1998. The arbitrator found that she suffered serious injuries, including fractures of her right forearm and right leg as well as psychological problems as a result of the accident.

Ms. G was 22 years old at that time, single, employed and without children. She received income replacement benefits, but a dispute arose and the parties settled that claim by lump sum in

November 2002. Ms. G married after the accident and gave birth to a daughter on April 20, 2004.

The arbitrator described the history of the child care dispute at pp. 4-5 of his reasons:

By letter dated November 2, 2004, the Applicant submitted an October 17, 2004 treatment plan completed by Ms. P. Saunoris, R.N. (hereinafter referred to as the "Saunoris Proposal") for 50 hours a week of "nanny services" at a monthly cost of $2,267. Ms. Saunoris specifically noted the Applicant's fractured right radius and ulna, and submitted that Ms. G could not lift or carry the baby.

Pilot denied the Saunoris Proposal by letter dated November 9, 2004. The reasons given were that the "expenses are not reasonable and necessary with respect to the injuries sustained in the accident" and the Applicant was "not deemed catastrophic."

Ms. G requested a med-rehab DAC,³ and this was arranged in December 2004 at Work Able Centres. The assessment consisted of an orthopaedic assessment, a functional abilities evaluation and a neuropsychological assessment. The overall opinion of the DAC assessors, reported on March 11, 2005, was that:

The Treatment Plan in dispute is deemed reasonable and necessary from a neuropsychological perspective. It is recommended that [Ms. G] be provided with a childcare provider, as outlined in the treatment plan in dispute, for 6 to 12 months duration.

This was based on the opinion of Dr. P. Comper, the DAC psychologist, who opined that Ms. G's emotional problems would likely be "exacerbated by any sort of oppositional behaviour posed by a child just now entering into the 'terrible two's.' He was, therefore, of the view that the Saunoris Proposal was reasonable and necessary "to ensure the safe care of the child, time limited for a period between half a year and a year, "at which point it should be reviewed" [emphasis added]. Concurrently, Dr. Comper recommended counselling and/or other rehabilitation (including a pain management program) and a review of her current medication. I have no evidence that there has been any further DAC review of the Saunoris Proposal.⁴

In response to the DAC report, Pilot denied Ms. G's claim in April 2005 on the basis that she had elected income replacement benefits ("IRBs") and her IRB claim had been settled in November 2002. In late 2005, in response to claims for additional child care expenses, Pilot took the position that no benefits were payable because Ms. G was not catastrophically impaired. By that time, the catastrophic impairment hearing had been completed and the decision was pending. At the request of Ms. G, an interim benefits motion was scheduled for December 13, 2005 with respect to her claim for payment of nanny expenses as a rehabilitation benefit under the SABS. The arbitrator's preliminary issue decision was released a week later.

B. The Arbitration Decision

At the motion hearing, Ms. G submitted that s. 38(14)(a) of the SABS-1996, which makes a med-rehab DAC report binding on the insurer pending resolution of the dispute, required Pilot to pay her child care expenses from the commencement of the claim in November 2004. Her position was that nanny services are required to aid in her rehabilitation, and that the expense is payable under s. 15(5)(l) of the SABS-1996: "other goods and services that the insured person requires, except services provided by a case manager." Pilot disputed this, arguing that child care expenses are only available to recipients of weekly caregiver benefits under s. 13 of the SABS-1996, and not to IRB claimants like Ms. G. The insurer also submitted it was not bound by s. 38(14)(a) because, in its view, the DAC exceeded its authority in considering the claim as a rehabilitation claim.

The arbitrator rejected the insurer's submissions, concluding, in light of the positive DAC report, that s. 38(14)(a) of the SABS-1996 required the insurer to pay the claim pending resolution of the dispute or a negative DAC report (one that concludes "a different amount, or no amount is reasonable or necessary"). He made the following order:

Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that, presently subject to the non-catastrophic monetary limits of $100,000:

1. Pilot shall pay Ms. G the sum of $31,738, representing fourteen months of benefits (November 1, 2004 to December 31, 2005 inclusive) at the monthly rate of $2,267, as opined as reasonable and necessary in the medical/rehabilitation Work Able DAC report dated March 11, 2005.

2. Pilot shall further pay Ms. Q, ongoing from January 2006, the monthly sum of $2,267 until:

(a) in accordance with the procedure set out in section 38 of the Schedule, a medical/rehabilitation DAC opines that a different amount, or no amount is reasonable or necessary; or,

(b) until such further or other order of an arbitrator.

3. interest is payable from March 11, 2005 on the November 2004 to March 2005 monthly amounts of $2,267. Interest is payable thereafter on each monthly amount of $2,267, from the first of each respective month. Interest is payable on all overdue amounts at the rate of two per cent per month, compounded monthly.

4. the issue of a special award will be determined upon receipt of further written submissions by Friday, January 20, 2006, at 5:00 p.m.

5. the issue of the legal expenses of this motion will be determined upon receipt of further written submissions by Friday, January 20, 2006, at 5:00 p.m.

C. Preliminary Appeal Issues

The parties agreed that the appeal of the arbitrator's interim benefits order should proceed, though the decision did not finally resolve all the issues in dispute.⁵ The arbitrator has released two more decisions since Pilot commenced this appeal. In his decision of March 16, 2006, he ruled that Ms. G suffered a catastrophic impairment as defined in s. 2(1)(f) of the SABS-1996. The insurer's appeal and claimant's cross-appeal of that decision are scheduled to be heard on October 30, 2006. The insurer has also appealed the arbitrator's decision, dated June 21, 2006, ordering payment of a special award and arbitration expenses in relation to the nanny expenses motion. A final hearing on Ms. G's entitlement to child care services has yet to be scheduled.

In response to the arbitrator's order, and pending the outcome of this appeal, Pilot paid the $28,119.35 that remained of the $100,000 medical and rehabilitation benefits available to Ms. G absent a catastrophic impairment determination. However, because the payment was made only on a pending resolution basis, Ms. G's representatives held the funds in trust, and agreed the appeal should be heard expeditiously. Pilot asked for a stay of the additional benefits owing pursuant to the arbitrator's order, to the extent they depended on catastrophic impairment determination, plus any interest on the benefits paid.

On February 9, 2006, I denied the stay request with respect to benefits and interest, except with respect to benefits beyond the $100,000 non-catastrophic cap, the latter in accordance with the arbitrator's remarks at pp. 3 and 24 of his reasons.

At the start of the appeal hearing on April 21, 2006, I heard the parties' submissions with respect to Pilot's request for a stay of the arbitrator's March 16, 2006 catastrophic impairment order and any further arbitration proceedings pending the outcome of both appeals. Because of the issues raised in that discussion, I invited the parties to make additional written submissions. After considering the parties' submissions, I denied the motion and rescinded my earlier order, which meant that the arbitrator's order with respect to nanny services was not limited to the $100,000 non-catastrophic med-rehab benefits cap.

III. ANALYSIS

A. "Pay Now, Dispute Later"

Pursuant to s. 38(14) of the SABS-1996, an insurer may refuse to pay a claim not supported by a med-rehab DAC, but must pay if the DAC concludes the benefits claimed are reasonable and necessary for the insured person's treatment or rehabilitation, subject to determination in accordance with sections 279 to 283 of the Insurance Act.

The arbitrator held that the insurer was required to pay "the Saunoris proposal" on receipt of the DAC report that supported it pending resolution of any dispute. I agree. Subsection 38(14)(a) is mandatory and its words are clear. While ultimately I conclude that the arbitrator erred in his conclusion on the question of law, there was nothing extraordinary or unreasonable about Ms. G's claim. If there are claims that are so obviously beyond the scope of the SABS that an insurer may be relieved of strict compliance with the pay pending dispute rules, this was not one of them. Allowing an insurer to decide unilaterally that the clear mandatory language of s. 38(14)(a) of the SABS-1996 does not apply would render the pay pending dispute provisions meaningless.

Had the arbitrator decided only that Ms. G was entitled to interim benefits based on the DAC report, I would have confirmed his ruling and dismissed the insurer's appeal. However, the decision went beyond the procedural issue. The arbitrator described the scope of the decision at the outset of his reasons.

Subsection 279(4.1) of the Insurance Act gives arbitrators the discretionary authority to make interim orders pending the final order in any matter. The specific relief sought in this motion, as amended at the oral hearing, is:

1. an Interim Order that Pilot pay, commencing November 1, 2004, the monthly sum of $2,267 prescribed in a medical/rehabilitation Designated Assessment Centre ("DAC") report of Work Able Centres dated March 11, 2005 until any further order of an arbitrator or in accordance with the review process set out in the DAC report. This issue raises the following questions:

• are nanny services an income replacement benefit or a caregiver benefit, or are they a medical/rehabilitation benefit?

• if nanny services are a medical/rehabilitation benefit, was Pilot required to pay them from November 1, 2004?

The first of these two questions is a pure question of law; the second is a mixed question of fact and law. That the question of law was the arbitrator's focus was made clear in the passage that followed, which suggested that the criteria for awarding interim benefits did not apply:

Neither party argued, either in their written submissions or in their oral arguments, that the criteria of (1) urgency or necessity (2) a prima facie, persuasive or convincing case (3) irreparable harm and/or (4) balance of convenience applied. The parties implicitly agree, and I concur, that this is simply a question of whether the services in question are payable as a rehabilitation benefit pursuant to paragraph 38(14)(a) of the Schedule and subsection 268(8) of the Insurance Act until the dispute is resolved.

The arbitrator's analysis with respect to s. 38(14)(a) was soundly based on well-established authorities, and his conclusion was correct. However, whether nanny services "are payable as a rehabilitation benefit" was a novel question of law on an important point. In my view, it should not have been dealt with summarily. There was also a factual dispute: Pilot took the position that the expenses claimed were not recoverable under s. 15 because they were not reasonable and necessary expenses for goods and services required as a result of the accident. Though the decision was framed as an interim ruling in the nature of injunctive relief, the arbitrator's comments strongly suggested that Ms. G would ultimately succeed. Any remaining doubt was resolved by reference to the catastrophic impairment decision, released in March 2006.

Given the arbitrator's clear ruling on the s. 15 issue and Pilot's appeal on that very point, I do not have the option of dismissing the appeal based on s. 38(14)(a), and doing so would not benefit either party.

B. Are Nanny Services or Child Care Expenses a Rehabilitation Benefit?

I agree with the arbitrator that s. 15 is broadly worded and provides a wide range of benefits. Its objectives are described in s. 15(2):

The rehabilitation benefit shall pay for reasonable and necessary measures undertaken by an insured person to reduce or eliminate the effects of any disability resulting from the impairment or to facilitate the insured person's reintegration into his or her family, the rest of society and the labour market.

I have little doubt that access to child care services may reduce or eliminate the effects of a caregiver's accident-related disability or facilitate her reintegration into her family and the labour market.

However, s. 15(2) does not stand alone. The benefits provided to achieve those objectives are described in s. 15(5):

The rehabilitation 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 purpose referred to in subsection (2) for,

(a) life skills training;

(b) family counselling;

(c) social rehabilitation counselling;

(d) financial counselling;

(e) employment counselling;

(f) vocational assessments;

(g) vocational or academic training;

(h) workplace modifications and workplace devices, including communications aids, to accommodate the needs of the insured person;

(i) home modifications and home devices, including communications aids, to accommodate the needs of the insured person, or the purchase of a new home if it is more reasonable to purchase a new home to accommodate the needs of the insured person than to renovate the insured person's existing home;

(j) vehicle modifications to accommodate the needs of the insured person, or the purchase of a new vehicle if it is more reasonable to purchase a new vehicle to accommodate the needs of the insured person than to modify an existing vehicle;

(k) transportation for the insured person to and from counselling and training sessions, including transportation for an aide or attendant;

(l) other goods and services that the insured person requires, except services provided by a case manager.

As paragraphs (a) through (k) do not apply, Ms. G's claim was brought under s. 15(5)(l): "other goods and services that the insured person requires, except services provided by a case manager." As noted by the arbitrator, case manager services are the only stated exception to the generality of that "basket clause." Nothing in s. 15 specifically excludes nanny expenses from the scope of the benefits provided. In contrast, s. 15 sets out specific limits on vehicle-related rehabilitation expenses,⁶ home expenses,⁷ workplace expenses,⁸ transportation expenses,⁹ and the fees that can be charged for professional services, including services under s. 15(5)(l).¹⁰ However, the absence of any reference to child care services is not determinative; it may mean they are not exempted from s. 15, or that they are beyond the scope of s. 15 and therefore the drafters saw no need for an exemption.¹¹ To determine the significance of the omission, it is necessary to consider the legislative context: how does s. 15 fit within the SABS as a whole?

I agree with the insurer that s. 15 must be considered alongside other provisions of the SABS-1996 that deal with child care. Section 13 (weekly caregiver benefits) pays "for reasonable and necessary expenses incurred as a result of the accident" in caring for "a person in need of care," defined as a person under 16 or a person who requires care because of physical or mental incapacity. In the most common situation, the benefit is available to a stay-at-home mother with respect to her children born before the accident,¹² while she is substantially unable to engage in her pre-accident caregiving activities as a result of and within 104 weeks after the accident. The benefit pays up to $250 per week for the first child plus $50 per week for each additional child, but the maximum is higher if the optional caregiver benefit described in s. 27(1)2.i. was purchased.

Subsection 36(1) of the SABS-1996, the "no stacking" rule, prohibits a person from receiving more than one weekly benefit - income replacement benefit, non-earner benefit or caregiver benefit - at any given time, but s. 36(2) allows an election if a claimant may qualify for more than one weekly benefit.¹³ The arbitrator correctly dismissed the insurer's submission that Ms. G could not recover nanny expenses as a rehabilitation benefit because she "elected" income replacement benefits under s. 12 rather than caregiver benefits under s. 13. Ms. G's daughter was born after the accident, making her ineligible for caregiver benefits; Ms. G claimed and received income replacement benefits. I also agree with the arbitrator that s. 13 does not create a double recovery issue in this case because of Ms. G's ineligibility for that benefit.

However, this does not answer the insurer's statutory interpretation argument. Pilot submits that caregiver benefits provide the only basis in the SABS for payment of child care expenses. The arbitrator rejected this position on the basis that "unlike case manager services, there is no specific exclusion in section 15. . . ."¹⁴ However, Pilot's argument is that the arbitrator's interpretation of s. 15 would make s. 13 superfluous. I agree. If the arbitrator is right about s. 15 of the SABS-1996, it is difficult to give any coherent meaning to s. 13, s. 28 or s. 36(1)3.

First, the arbitrator's interpretation undermines the "no stacking" rule in s. 36(1) because it would allow Ms. G to recover child care expenses, a benefit provided under s. 13, despite the fact that she claimed and received income replacement benefits, eventually settling that claim. This was the kernel in the insurer's argument that Ms. G could not recover child care expenses because she " elected" income replacement benefits.

Moreover, the arbitrator's interpretation takes no account of s. 28 of the SABS-1996, which provides optional "dependant care" coverage that pays for additional child care expenses incurred as a result of the accident for a claimant who was employed at the time of the accident and who is not receiving caregiver benefits. The benefit pays for weekly expenses of up to $75 for the first child and $25 for each additional child, to a weekly maximum of $150. Whether Ms. G, had she purchased the optional s. 28 coverage, could have claimed dependant care benefits for her child born after the accident, was beyond the scope of this appeal.

In addition, the arbitrator's interpretation would make s. 13 superfluous because it would allow a claim under s. 15 in respect of a child born after the accident, allowing a claimant to circumvent the "at the time of the accident" requirement in s. 13(1). It would also read out the prescribed maximums in s. 13(3) and remove any advantage in purchasing the optional coverage described in s. 27(1)2.i. by providing for a s. 15 "top-up" for child care expenses in excess of the prescribed amounts. Though several early Commission decisions held that a recipient of weekly income benefits or weekly (no-income) benefits under the SABS-1990 could also claim child care expenses under s. 6(1)(f),¹⁵ I am not persuaded the same analysis applies to the SABS-1996 which, unlike the SABS-1990, contains specific provision for child care.

The SABS-1990 treated caregiver benefits as a supplement to weekly (no-income) benefits. In addition to the weekly benefit of $185 paid under s. 13(1) to a person who suffered, as a result of and within two years of the accident, a substantial inability to perform the essential tasks in which she would normally engage, s. 13(4) paid an additional $50 per week ($100 if an optional benefit was purchased) for each dependant, to a maximum of an additional $200 weekly ($400 with optional benefits).

Significantly, this caregiver benefit was offered as a weekly benefit based on the number of children at the time of the accident. There was no requirement to prove what, if any, child care expenses were incurred. The SABS-1990 did not include any express provision for payment of child care expenses - or housekeeping and home maintenance expenses - and accordingly, the early decisions relied on by Ms. G allowed such claims under s. 6(1)(f), the med-rehab benefits "basket clause" that was the predecessor to s. 15(5)(l) of the SABS-1996. Arbitrators allowed these claims while recognizing that the med-rehab benefits provided under s. 6 were intended to pay for reasonable goods and services that are required for the injured claimant's recovery and rehabilitation, and were not intended to replace the services she provided before the accident. For example, in Le, Arbitrator Mackintosh reasoned as follows:

If I accept counsel for the Insurer's proposition that the Primary Caregiver Benefits of section 13(4) represent the exclusive source of recovery for babysitting expenses under the Schedule; I must also conclude that the drafters of the [SABS] intended no reimbursement of babysitting expenses to injured persons claiming under other sections of the Schedule. Therefore, a single working parent, receiving Weekly Income Benefits under section 12, could not claim expenses associated with after-school and over-night childcare for her children, while she recuperated in hospital. Likewise, an insured who did not sustain disabling injuries (to qualify for benefits under section 12 or 13), but who nevertheless required assistance with the heavier aspects of housework, or required babysitting care while attending physiotherapy sessions, could not claim such expenses. I cannot accept that drafters of the Schedule intended to exclude such claims.¹⁶

Returning to the issue, the arbitrator added further reasons for her conclusion:

The Insurer is obligated to meet the Applicant's rehabilitation and therapeutic requirements in the circumstances in which the Applicant finds herself, at the time of the accident. The Applicant required hospitalization. The Applicant is the mother of a young child; as such, she has both a moral and legal duty to provide responsible care and supervision for that child during her absence. Such services constitute more than a service to the child. They are, in fact, services required by the Applicant as the result of her disability and hospitalization. There is a real and direct connection between the Applicant's therapeutic and rehabilitative requirements and the services provided.¹⁷

The important context of these decisions was the silence of the SABS-1990 with respect to child care expenses. The issue is dealt with expressly in subsequent versions of the SABS.

The SABS-1994 retained a weekly benefit of $185 for non-earners who suffered a partial or complete inability to carry on a normal life as a result of the accident.¹⁸ Caregivers were now offered a specific benefit if suffering a substantial inability to engage in pre-accident caregiving activities or a partial or complete inability to carry on a normal life as a result of the accident. The benefit was fixed at $250 weekly for the first child and $50 for each additional child. Again, there was no need to prove that expenses were incurred. Section 61 introduced an election of weekly benefits, along with a "no stacking" rule. A "post-caregiver" benefit was also created to allow a caregiver benefit recipient whose child has turned 16 to elect income replacement benefits, if qualified,¹⁹ or other disability benefits.²⁰

The SABS-1994 also introduced a new dependant care expenses benefit [s. 54] to pay for "additional expenses reasonably incurred by or on behalf of the insured person in caring for the insured person's dependants as a result of the accident." This provision applied only to a person who was employed at the time of the accident and not in receipt of caregiver benefits. The benefit paid up to $75 per week for the first dependant and $25 per week for each additional dependant, to a total of $150 per week. Housekeeping and home maintenance expenses also received explicit recognition in the SABS-1994; s. 55 required the insurer to pay for "additional expenses reasonably incurred by or on behalf of the insured person as a result of the accident for housekeeping and home maintenance services." Both new benefits were offered as a mandatory coverage in the standard policy in addition to weekly benefits.²¹ I am aware of no decision awarding child care or housekeeping and home maintenance expenses as a rehabilitation benefit under the SABS-1994.²²

Returning to the SABS-1996, then, the significant change in s. 13 is that caregiver benefits are now payable only for "reasonable and necessary expenses incurred as a result of the accident in caring for a person in need of care." [emphasis added] This means that a stay-at-home mother who is substantially unable to engage in her pre-accident caregiving work, receives no compensation for her disability if she elects caregiver benefits, though she can claim up to the prescribed limits for someone else to do the work.²³ The SABS-1996 also reduces the child care expenses available to IRB recipients like Ms. G. Dependant care expenses, formerly provided as a mandatory coverage in the standard policy, are now an optional coverage.

The legislative evolution of the child care provisions through the three versions of the SABS provides additional support for my contextual reading of the s. 15 of the SABS-1996. In my view, the legislature intended the SABS-1996 to provide for child care expenses through s. 13 (weekly caregiver benefits for stay-at-home mothers) and s. 28 (optional dependant care benefits for working mothers). I am not persuaded s. 15 was intended to pay for nanny services for a mother who is unable to care for her child because of accident injuries.

As the arbitrator noted, several Commission decisions have considered an analogous issue: whether a self-employed IRB recipient can recover the cost of "replacement labour" as a rehabilitation benefit. The first case was Zehr and The Guarantee Company of North America, (OIC A-001963, July 30, 1993), which concerned a farmer who hired several neighbours to do the heavy farm work he could no longer perform as a result of his accident injuries. I rejected his claim for recovery of their wages as a rehabilitation benefit under s. 6 of the SABS-1990 because I found these were business expenses incurred to keep the farm going:

I heard no evidence that the work of the hired farm workers will facilitate Mr. Zehr's rehabilitation, except by allowing Mr. Zehr to avoid the restricted activities. This goal could be achieved without Mr. Zehr hiring others to replace his labour. Mr. Zehr's testimony was that he hired farm workers in order to keep the farm going during the period of his disability. Though this is an admirable goal, it does not relate to Mr. Zehr's rehabilitation, however broadly defined, under section 6. The decision to keep the farm going was a business decision. The hired farm workers are not helping Mr. Zehr to perform the heavy farm work, supplementing his work, retraining him, or helping in his physical or vocational rehabilitation. They are replacing Mr. Zehr's labour.²⁴ [emphasis added]

In Zettler and Pilot Insurance Company, (OIC A97-000674, March 31, 1998), a decision under the SABS-1994, Arbitrator Sampliner applied the same reasoning in denying another farmer's claim to recover labour expenses as a rehabilitation benefit under s. 40(5)(e), though he "would be prepared to consider some labour expenses necessary to continue business operations where the applicant is reasonably assured he or she will be able to resume the task in the near future."²⁵In DesRoches and Economical Mutual Insurance Company, (FSCO A97-000312 and A97-000814, November 10, 1999), at p. 24, the arbitrator quoted this comment with implicit approval. In my view, the more pertinent observation is that the SABS-1994 replaced the awkward "ceasing expenses" rule in the SABS-1990 with a rule that allows a self-employed claimant to deduct the cost of replacement labour and other additional business expenses in calculating net income or losses from self-employment after the accident.²⁶ In any event, the arbitrator dismissed Mr. DesRoches' claim for recovery of the cost of replacement labour to finish building the family home, despite his recognition that this would facilitate his reintegration into his family.²⁷

In fact, the rehabilitation benefit claims for replacement labour costs have all been rejected, though adjudicators have suggested that additional labour costs incurred to help the claimant do the job (rather than replacing his labour) may be recoverable as a rehabilitation expense in the right circumstances. In this case, there seems to be no suggestion that Ms. G needs a nanny so she can attend rehabilitation assessments or participate in rehabilitation programs otherwise covered under s. 15, and the appeal does not concern any dispute about counselling or other rehabilitation assistance directed at the psychological problems affecting Ms. G's ability to care for her child. Instead, Ms. G claims nanny services to care for her child while she is unable to do so because of her psychological problems resulting from the accident. This is a sympathetic claim, but I conclude the expenses claimed are not recoverable as rehabilitation benefits. As noted by her counsel, Ms. G's child care expenses could be recovered as future care costs in any tort action. The issue before me is whether the arbitrator erred in finding that s. 15 of the SABS-1996 provides the coverage claimed. I am persuaded he did.

IV. EXPENSES

If the parties are unable to agree about expenses of this appeal, a hearing may be arranged in accordance with Rule 79 of the Dispute Resolution Practice Code.

August 28, 2006

Nancy Makepeace

Director's Delegate

Date

Footnotes

1. 1The parties disagreed about the characterization of the claim, Ms. G referring to "nanny services" and the insurer preferring "child care" expenses. I use the terms interchangeably. As I stated at the appeal hearing, my decision does not depend on terminology.
2. 2The SABS-1996 is the Statutory Accident Benefits Schedule —Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended. This decision also refers to the SABS-1990 (the Statutory Accident Benefits Schedule - Accidents before January 1, 1994, Ontario Regulation 672/90, as amended), and the SABS-1994 (the Statutory Accident Benefits Schedule - Accidents after December 31, 1993 and before November 1, 1996, Ontario Regulation 776/93, as amended).
3. 3An assessment under s. 38 of the SABS-1996 with respect to medical benefits (s. 4) or rehabilitation benefits (s. 15).
4. 4Arbitration decision, p. 6. The Saunoris proposal was not supported by Dr. M. Tile, the DAC orthopaedic surgeon, or the DAC's FAE assessors.
5. 5See Rules 50.2 and 51.2(c) of the Dispute Resolution Practice Code.
6. 6Subsections 15(5)(j), 15(9) and 15(10).
7. 7Subsections 15(5)(i), 15(7) and 15(8).
8. 8Subsections 15(3), 15(4) and 15(5)(h).
9. 9Subsections s 15(5)(k), 15(11) and 15(12).
10. 10Subsection 15(6).
11. 11See, for example, Driver and Traders General Insurance Company, (FSCO P03-00006, November 18, 2003), at p. 14: "The Arbitrator's finding that Vistasp therapy was not a service 'of a medical nature' for which s. 14 benefits were available, did not imply it was a rehabilitative measure under s. 15.
12. 12I refer to a stay-at-home mother of young children for ease of reference. Under s. 13(4) of the SABS-1990, weekly primary caregiver benefits were payable "for each person who at the time of the accident was residing with the insured person and in respect of whom the insured person was the primary caregiver if the person receiving the care was less than sixteen years of age or if the person required the care because of physical or mental incapacity." Subsection 18(5) of the SABS-1994 and s. 13 of the SABS-1996 have similar application.
13. 13The SABS appears to allow a stay-at-home mother (but not a working mother) the option of claiming non-earner benefits (NEBs) rather than caregiver benefits. The disadvantage is that NEBs are not payable at all for the first 26 weeks after the accident. The advantage is that the rate, while lower than the maximum caregiver benefit, is payable to the claimant (not a third-party child care provider) for the remainder of the 104 weeks after the accident as long as she satisfies the qualifying test. If there is no longer a person in need of care within 104 weeks after the accident, a recipient of caregiver benefits who is completely unable to carry on a normal life is eligible for non-earner benefits. Caregiver benefits are payable after 104 weeks only if the claimant suffers a complete inability to carry on a normal life (that is: if she satisfies the test for entitlement to non-earner benefits), but the benefit still pays only for expenses.
14. 14Arbitration decision, p. 19.
15. 15Le and Wellington Insurance Company, (OIC A-000920, November 25, 1992) and Chamale and Wellington Insurance Company, (OIC A-000849, September 25, 1992), conf'd on appeal (OIC P-000849, July 9, 1996), with respect to non-earners, and Edwards and State Farm Mutual Automobile Insurance Company, (OIC A-001707, July 12, 1993), conf'd on appeal (OIC P-001707, February 26, 1996), with respect to a recipient of weekly income benefits. See also, on the latter point, Park and Citadel General Assurance Company, (OIC A-003410, August 23, 1993). Housekeeping and home maintenance expenses were awarded on the same basis; see Caputo and Wellington Insurance Company, (OIC A-000697, June 23, 1994), conf'd on appeal (OIC P-000697, July 25, 1996).
16. 16At p. 27.
17. 17At pp. 30-31.
18. 18Section 19, Other Disability Benefits.
19. 19Subsection 7(1)5 and s. 61(6).
20. 20Subsection 19(1)(c).
21. 21See, for example, Elyassir and Co-Operators General Insurance Company, (FSCO A96-001838, February 18, 1999).
22. 22The predecessor to s. 15(5)(l) of the SABS-1996 is s. 36(1)(h) of the SABS-1994: "If an insured person sustains an impairment as a result of an accident, the insurer shall pay for all reasonable expenses incurred by or on behalf of the insured person as a result of the accident for, . . . . (h) other goods and services of a medical nature that the insured person requires."
23. 23Alternatively, she may elect non-earner benefits. See note 13 above.
24. 24At p. 15., Zehr was approved in another SABS-1990 appeal decision: Saini and Wellington Insurance Company, (QIC P-001515, April 3, 1997).
25. 25At p. 9.
26. 26See s. 12(7)3 of the SABS-1990, s. 10(6) and 10(8) of the SABS-1994, and s. 6(4) and 6(6) of the SABS-1996.
27. 27At p. 22.