Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2006 ONFSCDRS 98

FSCO A03-000041

BETWEEN:

BRENDA LEE

Applicant

and

CERTAS DIRECT INSURANCE COMPANY

Insurer

REASONS FOR DECISION

Before:

Suesan Alves

Heard:

July 20, 21, 22, 23, 26, 27, 28, 2004, August 16, 2004 and October 8, 2004 in London, Ontario.

Written submissions were received by November 12, 2004

Appearances:

Gordon Good for Ms. Lee

Ryan M. Naimark for Certas Direct Insurance Company

Brenda Lee was injured in a motor vehicle accident on January 8, 1999. She applied for and received statutory accident benefits from Certas Direct Insurance Company ("Certas"), payable under the Schedule.¹ In this arbitration, Ms. Lee claims payment of $7,200 which Certas deducted as collateral benefits from her pre 104-week income replacement benefits. She also claims post 104-week income replacement benefits, interest, expenses and a special award. Certas disputes Ms. Lee's entitlement to all of the relief she seeks, and claims its arbitration expenses.

The issues in this hearing are:

Was Certas entitled to reduce Ms. Lee's pre 104-week income replacement benefits, ("IRBs") by the amount she received from a disability insurance policy with the Independent Order of Foresters, ("IOF") pursuant to section 7 of the Schedule?
Is Ms. Lee entitled to post 104-week IRBs pursuant to the provisions of section 5 of the Schedule?
Is Ms. Lee entitled to interest on overdue amounts pursuant to section 46 of the Schedule?
Is Ms. Lee entitled to a special award under section 282(10) of the Insurance Act, R.S.O. 1990, c. I.8 as amended?
Which party is entitled to expenses of the arbitration?

Certas was not entitled to reduce Ms. Lee's pre 104-week IRBs by the amounts she received under an IOF disability insurance policy. Certas is obliged to pay Ms. Lee $7,200.
Ms. Lee is entitled to post 104-week IRBs pursuant to the provisions of section 5 of the Schedule.
Ms. Lee is entitled to interest on overdue amounts under section 46 of the Schedule.
Ms. Lee is entitled to a special award in the amount of $1,500 under section 282(10) of the Insurance Act.
If the parties are unable to agree on expenses, that issue may now be addressed.

Ms. Lee was injured when she slipped and fell on the icy steps of a bus on January 8, 1999. Certas paid Ms. Lee income replacement benefits up to the 104-week mark, but deducted $7,200, the amount she received under a disability insurance policy with Independent Order of Foresters, ("IOF").

Certas submits that it was entitled to deduct the IOF benefits under paragraph 7(1)1.i of the Schedule. That section permits an insurer to deduct from an income replacement benefit "net weekly payments for loss of income that are being received by the person as a result of the accident under the laws of any jurisdiction or under any income continuation benefit plan." Ms. Lee disagrees that the IOF payments were deductible under paragraph 7(1)1.i of the Schedule.

Certas bears the burden of establishing that it was entitled to deduct the benefits.²

Law

An indemnity policy compensates the insured for a pecuniary loss which has been incurred, and no more than the loss. Where two or more policies respond to a loss, legislation or the related policy provisions permit insurers to deduct collateral benefits to prevent the insured from being overcompensated. In contrast, a non-indemnity insurance policy is one in which an agreed amount is paid when the adverse event occurs. There is no issue of overcompensation or concern with double recovery. This is because the common law has long recognized that persons may purchase non-indemnity insurance policies in order to cushion their losses, or the losses of others, following the happening of an adverse event.

In Economical Mutual Insurance Company and Wilcox, (FSCO P99-00015, March 2, 2000)³, Director's Delegate Draper held that the collateral benefits deduction provisions under the Bill 164 Schedule had to be interpreted "having regard to the central concern about double-recovery at common law and the indemnity/non-indemnity distinction." He held that the collateral benefits provision in the Schedule was intended to eliminate only certain instances of double recovery. The Director applied the approach taken by the Divisional Court in Cugliari v. White,⁴ and by the Court of Appeal in Dall Estate v. Adams,⁵ examined the features of the disability policy in question, and concluded that the disability benefits were not deductible.

Ms. Lee's benefits are governed by the Bill 59 Schedule. Although there are several changes in Bill 59 from the predecessor Schedules, I find that the analysis in Wilcox is relevant and applicable to the Bill 59 scheme, because the deduction of collateral benefits plays a similar role in both Schedules, and because similar language is used in both Schedules.⁶ Both Schedules are regulations made pursuant to the Insurance Act. Under the consistent expression principle of statutory interpretation, the presumption is "that the legislature uses language carefully and consistently so that the same words have the same meaning and different words have different meanings within a statute or other legislative instrument. Once a particular way of expressing a meaning has been adopted, it is used each time that meaning is intended.⁷

The IOF Policy

It is necessary to examine the features of the policy in question to determine whether it is an indemnity or non-indemnity policy. Not infrequently, the policy contains mixed features.

The two main hallmarks of an indemnity policy are a stated intent to pay income security for loss of wages, and provisions designed to continue paying an amount of income that closely follows the claimant's pay at the time of her disability."⁸

I find that neither of these hallmarks is present in the IOF policy. There is not a stated intent to pay income security for loss of wages. There is no indication that the amount of the benefit is designed to follow Ms. Lee's pay at the time of her disability. At the time of the accident, Ms. Lee was earning $323.35 per week.⁹ The IOF policy provides a benefit payable at one of two pre-set rates—either $300 or $150 per month. I find the amount of the benefit bears no reasonable relationship to Ms. Lee's earnings at the date of the accident or at the time she purchased the policy.

The IOF policy provides a benefit which commences four months after the onset of disability. I find the gap suggests that the policy was a financial cushion which Ms. Lee arranged for herself in the event of disability which lasted for longer than four months, rather than a policy tied to her earnings.

The amount of the benefit is reduced to $150 for any period of total disability which commences while the insured is "not gainfully employed on a full time basis away from your home." It is unclear whether the lesser benefit is intended to cover a self-employed person who works out of the home, a person who works part-time outside the home or a homemaker. I find both benefits are pre-determined amounts payable upon proof of a specified event. Pre-determined periodic benefits which do not vary with the wage rate are not indemnity policies and those benefits will not be deductible.

Disability policies arranged through an employer or union, in which the employer or union contributes to premium payments, where coverage terminates when the employee was no longer working, have been found to be income continuation payments or indemnity policies.¹⁰On these criteria, the IOF policy does not qualify as an indemnity policy and the payments do not qualify as income continuation payments. Ms. Lee purchased the IOF policy herself in 1989 and paid all the premiums herself. Her policy was not arranged through an employer or union. There has been no involvement or contribution of premiums by a union or an employer. The IOF policy provides payment for periods of total disability which commence while the certificate is in force. Coverage does not end with unemployment.

Policies which require the claimant to demonstrate pecuniary loss, or report changes of income, or policies which contain subrogation rights or provisions to avoid double recovery have been held to be indemnity policies.¹¹ There is no provision in the IOF policy for subrogation rights. Payments begin after approximately four months of disability, and end after two years. There is no clause integrating the amount of the IOF benefit with any other payments, nor are there provisions to avoid double recovery.

Certas submits that the IOF policy which Ms. Lee purchased was an income continuation policy because the policy is called a "monthly income benefit," and I agree that this term can be interpreted in this manner. I also agree that the provision which requires the claimant to be earning zero from employment to qualify for the benefit, can suggest that the benefits are payments to replace lost income. However, the absence of the hallmarks of an indemnity policy, and the dominant features of this policy lead me to conclude that the IOF policy is a non-indemnity policy and the benefits Ms. Lee received were not payments for loss of income received under an income continuation benefit plan.

Further, the Schedule contemplates the deduction of net weekly payments for loss of income. In this case, the IOF policy provided for the payment of monthly benefits, at the end of the month, and, in the event that benefits were payable during less than a month, the amount payable will be paid at the daily rate of 1/30th of the monthly amount. As the IOF benefits were paid monthly, not weekly, they would not be caught by the wording of section 7(1)1.i of the Schedule.

For these reasons, Certas must pay Ms. Lee the $7,200 it deducted from her income replacement benefits.

Post 104-week income replacement benefits

Overview

Ms. Lee was injured when she slipped and fell awkwardly on the icy stairs of a bus on January 8, 1999. She was alighting from the bus, when she fell in the stairwell, in a kneeling position, with one leg on an upper step, and the other on a lower step and with her back twisted. Ms. Lee pulled her anterior thigh muscles, sprained her lumbar sacral spine, her neck and upper thoracic areas and hurt her knee.¹² Ms. Lee's knee and thigh problems resolved and her neck and thoracic injuries improved somewhat. However, her mechanical low back pain became chronic. At the time of the accident, Ms. Lee was 49 years of age and employed at London Life as a team conversion clerk. This was light industrial work.

Certas paid Ms. Lee income replacement benefits to the 104-week mark. In this arbitration, Ms. Lee claims entitlement to post 104-week income replacement benefits. Ms. Lee submits that she has significant limitations as a result of her injuries which render her unable to work competitively on a sustained basis.

Certas disputes that Ms. Lee meets the test of entitlement to post 104-week income replacement benefits. Certas' theory of the case raises issues of Ms. Lee's credibility; causation in relation to two post-accident injuries; her motivation; and the inferences to be drawn from its surveillance. I will first deal with Certas' theory of the case. For the reasons given, I conclude that Certas' theory of the case does not withstand scrutiny.

Both parties' experts agree that Ms. Lee's chronic low back, thoracic and cervical pain and chronic pain syndrome are attributable to the January 8, 1999 accident. I then consider Ms. Lee's attempts to return to work, suitable work, the medical and vocational opinion evidence, and conclude that Ms. Lee has established that she meets the test for entitlement to post 104-week income replacement benefits. I do not need to deal with the fibromyalgia diagnoses.

Credibility and Memory

Ms. Lee candidly admits she has a very poor memory. She has complained about this problem to her health practitioners. Certas submits that Ms. Lee is not credible. I disagree. This is not a case in which the Applicant has a selective memory and forgets only those things which hurt her case. During her testimony, it became evident that Ms. Lee forgets things that hurt, help and have no impact on her case.

Medication, pain, lack of sleep, her age and the stress of coping with the sequelae of the accident have all been advanced as possible explanations for Ms. Lee's memory difficulty.

Ms. Lee has taken prescribed medication for over 20 years to control and prevent her temporal lobe seizures. A known side effect of one of these medications can be short-term and long-term memory problems.

Ms. Lee experiences pain on an ongoing basis. Dr. M. R. MacDonald, her treating psychologist, opined that pain attracts her attention so that she cannot focus on the task at hand. This interferes with her ability to concentrate and remember information. Ms. Lee experiences an increased level of pain when she remains in one position for too long. While asleep, that pain causes her to awaken during the night, robbing her of restorative stage four sleep. According to Dr. MacDonald, a lack of stage four sleep also has an adverse impact on memory. Dr. Delaney, Ms. Lee's physiatrist, agrees that the loss of stage four sleep has this impact.

Stress and middle age are other possible contributors: Ms. Lee was 49 years of age at the time of the motor vehicle accident. In the opinion of her treating psychologist, and of Dr. P. Williamson, a psychiatrist who conducted an insurer's examination, Ms. Lee experienced significant stress in coping with the sequelae of her injuries and dealing with her chronic pain.

I accept that all of these factors likely play some role in Ms. Lee's difficulties with memory. In this context, reliability is a legitimate concern.

Ms. Lee was cross-examined extensively. In this case, the Insurer has conducted an exhaustive investigation of her past and the Applicant has provided documentary disclosure. I find it unlikely that any significant events concerning her medical history have not been disclosed in the course of that discovery process.

Ms. Lee's testimony demonstrated just how problematic it can be to jog her memory and prompt her recall. However, once her recall was prompted, she provided a good deal of detail in relation to the matter in question. I agree with the submission of her counsel, that she generally testified in a forthright manner.

I have considered her evidence with caution. I am satisfied that the problems are not due to dishonesty or a desire to conceal her medical history, but due to her memory problems, aspects of which may well be the result of the accident. She also has a complex medical history. In one instance, in relation to a pothole incident, discussed below, her memory problems were compounded by a failure on her part to appreciate the possible relevance of a post-accident injury.

The pothole incident

Ms. Lee was injured in two post-accident incidents which have raised causation issues for Certas. The first occurred on April 10, 1999, about three months following the accident on the bus, when Ms. Lee stepped or stumbled into a pothole, twisted her left foot and sustained an avulsion fracture to the fifth metatarsal—the bone behind her left little toe. With this type of fracture a tendon or a ligament pulls off a bit of bone.

Ms. Lee testified that she did not fall, but just sat herself down on the ground. She drove herself to the walk-in clinic, was instructed to go to the hospital and did so. Initially, she was splinted, then wore a walking cast for about four weeks. She received extra exercises for her ankle while attending physiotherapy for her injuries from the January 8, 1999 fall on the bus. She testified that the fracture healed uneventfully. Certas alleges that this incident is the cause of her trochanteric bursitis, her low back pain and any ongoing disability.

Ms. Lee told her family doctor, chiropractor, Certas' file handler, and the Canadian Back Institute ("CBI"), about this injury. I find no evidence that Ms. Lee attempted to conceal it from Certas.

About two years after this incident, Ms. Lee saw Dr. Delaney, a physiatrist on a referral from her family physician. Ms. Lee did not tell Dr. Delaney about the fracture. Dr. Delaney testified that she had asked Ms. Lee a question about other injuries which should have elicited the information concerning the pothole incident, and I accept that Dr. Delaney did so. Having seen the extent to which it was necessary to ask Ms. Lee questions during cross-examination to prompt her recall of a shoulder injury she sustained some seven years earlier, I accept that Dr. Delaney's question did not prompt Ms. Lee's recall, perhaps in part because Ms. Lee failed to appreciate that there were possible medical causation issues.

When asked for an explanation for not informing Dr. Delaney, Dr. Deathe, a physiatrist who examined her on behalf of Certas in 2003, and Dr. P. Williamson, a psychiatrist who assessed her on behalf of Certas in 2002, about the fracture, Ms. Lee responded that the fracture healed uneventfully, that she had not remembered the event, and that she did not believe that it was relevant. I find it unlikely that having disclosed the injury to Certas and her family physician, she would then seek to conceal it from Drs. Delaney, Deathe and Williamson.

However, that information was relevant, as trochanteric bursitis can follow from a fall on the buttocks.¹³ Dr. Delaney diagnosed Ms. Lee with bilateral trochanteric bursitis, and in the absence of any other cause, attributed it to her fall on the bus. Dr. Deathe, a physiatrist who conducted an insurer's examination, opined that a fall following the slip in the pothole was a likely cause of her trochanteric bursitis; not the fall on the bus. Had Ms. Lee offered the information, the Applicant's and the Insurer's physiatrists could have obtained a more detailed history of the nature of her contact with the ground following the fracture in the bone behind her little toe.

According to the history in the outpatient hospital record, Ms. Lee "did not injure anything else in the fall." In cross-examination, Dr. Deathe stated that if he had used those words, he (Dr. Deathe) would have intended to convey that Ms. Lee did not hurt her back in the fall. The report of the orthopaedic surgeon states that the fracture healed uneventfully. In re-examination, Dr. Deathe opined that this was a reference to the fracture.

Dr. Delaney agreed with Dr. Deathe that a fall could have caused Ms. Lee's trochanteric bursitis. During re-examination, Dr. Delaney was questioned about a clinical note dated March 8, 1999, by Dr. Neely, chiropractor, in relation to both hips. She was asked whether this note, which predated the pothole incident, made it a bit more likely that the bursitis was attributable to the bus accident as opposed to the pothole incident. Dr. Delaney agreed that it probably made it a bit more likely that Ms. Lee's complaints of pain in her hips pre-dated the pothole incident.

Based on Dr. Delaney's response in re-examination, the notation in the outpatient hospital record, and Dr. Deathe's response in cross-examination to the contents of that record, I find it more likely than not that the trochanteric bursitis predated the pothole incident and was attributable to the fall on the bus as Dr. Delaney had opined.

I accept Dr. Deathe's opinion that walking with a cast likely exacerbated Ms. Lee's low back pain because it would have caused an asymetric gait. I find it likely that this exacerbation was temporary, since the cast was removed by May 25, 1999. I also find that Ms. Lee's low back flexion and extension improved from the time she was assessed at CBI on April 5, 1999 and continued to improve during her treatment until July 5, 1999. Although these are not measures of her pain, they do provide some indication of her level of function. For these reasons, I am not persuaded that the pothole incident had a significant impact on Ms. Lee's low back function.

Lumbar

Initial CBI April 5, 1999

Pothole incident April 10, 1999

Interim CBI June 4, 1999

End of CBI physio July 5, 1999

End of CBI work hardening Nov. 5, 2002

Average Nomative Values

Flexion

120

Extension

I have set out Ms. Lee's range of motion measurements of her lumbar spine in flexion and extension in chart form, above. Normal values are at the right of the chart. From the left of the chart, Ms. Lee's range of motion measurements are set out from the date of her physical assessment by CBI in April 1999. The pothole incident of April 10, 1999 is next. This is followed by the measurements taken at CBI in June 1999, after a few weeks of therapy. In July 1999 her measurements are recorded at the conclusion of her physiotherapy program. This is followed by her measurements recorded following the CBI work hardening program.

The 75% recovery question

Ms. Lee estimated that she recovered about 50% with chiropractic treatment, but had reached a plateau. Shortly before the pothole incident, Ms. Lee was asked by CBI staff to estimate her level of recovery. She is reported to have estimated her recovery at about 70%; and at 75%. Certas' theory of the case is that based on the latter estimate, Ms. Lee was largely recovered from her injuries in the bus accident and that the pothole incident is the true cause of any present disability; not the fall on the bus.

Ms. Lee is a layperson. I find that her optimism about her level of recovery must be considered in context. Ms. Lee gave that estimate during her intake assessment at CBI. At that time, objective measures of her range of motion in her low back and neck showed significant restriction. Neither Ms. Lee nor the treatment provider were of the opinion that she could perform her pre-accident job at the time. I also find the Insurer's own evidence from Dr. Deathe, a physiatrist, supports the conclusion that Ms. Lee was disabled from her pre-accident employment at that time.¹⁴

Thus, Ms. Lee's optimism about her recovery should not be equated with a belief that she was able to return to her pre-accident employment at that time. I reject Certas' position that Ms. Lee was no longer disabled at the time she made the statement. As detailed below Ms. Lee's complaints of her pain and about her impairments in her low back have been consistent since February 1999.

Motivation

Certas characterizes the Applicant as someone who lacks motivation with respect to work and obtaining treatment. I find that characterization inaccurate. I find that pre and post-accident events in relation to her work, her participation in treatment and her attempts to return to work convey a different picture.

Today's Temporary, the employment agency which placed Ms. Lee at London Life, considered her a valuable employee. While working at London Life, Ms. Lee received an award for productivity, because she achieved the highest level of production on the floor of the printing department. Ms. Lee's pride in that accomplishment was evident during her testimony. She worked overtime during the 11 months she worked at London Life.

Following the accident, Ms. Lee had four days remaining until her contract with London Life as a file conversion clerk expired. Although she was in pain, she returned to her job, did work she ordinarily performed in a standing position from a seated position, and asked a friend and co-worker to help her by doing the heavier tasks.

Certas submitted that Ms. Lee was not motivated to seek work and only did so when required to do so by social assistance, as part of the Ontario Works program. According to the social assistance file, when Ms. Lee applied for social assistance following the termination of her IRBs, her referral to the Ontario Works program was deferred on February 16, 2000, due to her impairments. Ms. Lee made a number of attempts at work in 2000 while she was exempt from the Ontario Works job search requirement. Ms. Lee testified that she attempted to find work knowing that she would have to report the earnings and that they would be deducted from her social assistance benefits.

I find Ms. Lee was motivated in seeking and complying with treatment, even when the results were not as she had anticipated. I accept the opinion of Ms. J. Kobayashi, the Applicant's vocational expert, that in her 15 years of experience, Ms. Lee's attendance record during the course of a work hardening program was outstanding. In August 2002, Ms. Lee was informed that there would be a lengthy delay before she could see Dr. Delaney for a consultation. Her family doctor's note of that visit states in part: "wants me to push Dr. Delaney for faster appointment."

Certas submitted that Ms. Lee failed to follow through with a referral to the fibromyalgia program at St. Joseph's Hospital to which she had been referred. I accept the testimony of various health practitioners that Ms. Lee pursued a reasonable equivalent of that program by doing exercises in a heated pool and seeing a psychologist skilled in treating chronic pain. Dr. Deathe noted that he had trained Dr. MacDonald, Ms. Lee's psychologist, and described him as "excellent."

There is a note dated November 14, 2003 in her family doctor's records, which, as I decipher it, reads: "Think she needs to get settlement and finish it. No real changes-except more lower back ache." Although this statement was put to Ms. Lee in cross-examination, the focus was on the nature of the court case to which Dr. Maddeford had referred. Whether or not this was a reference to her claim arising from the fall on the bus, I find it likely that on this occasion, Dr. Maddeford recorded his own reflective comment that it would be prudent for Ms. Lee to resolve her litigation and extricate herself from an additional source of stress. I do not accept that this statement was a reflection of Ms. Lee's thoughts at that time.

I conclude that Ms. Lee was a motivated, productive employee at the time of the accident, motivated in seeking and complying with treatment, and motivated in attempting to return to work. I reject Certas' submission that Ms. Lee lacked motivation.

Surveillance

I am not persuaded that the surveillance evidence in this case assists the Insurer. For the most part, the surveillance shows Ms. Lee doing things she has stated she was able to do, such as lifting 10 pounds, even before the surveillance was conducted. Certas submitted that if Ms. Lee could lift 10 pounds in each arm then she would have demonstrated the ability to lift 20 pounds, the strength requirement for light industrial work. This submission ignores Ms. Lee's difficulty with bilateral upper arm co-ordination, and the effect on her low back of lifting such a load. I find this submission speculative, and without any medical foundation.

June 16, 2002 accident

Ms. Lee was injured in another accident when her car was rear-ended by another vehicle on June 16, 2002. Her neck, shoulder and back pain flared up. Certas responded to the claim.

Ms. Lee attended the Accident Injury Management clinic, ("AIM") for physiotherapy three times per week and was discharged in November 2002 on the basis that she had attained maximum medical recovery. The evidence suggests that Ms. Lee was largely back to her pre-June 2002 condition by that time.

For these reasons, I conclude that Certas' theory of the case does not withstand scrutiny. I will now deal with the question of whether Ms. Lee is entitled to post 104-week income replacement benefits.

Eligibility for post 104-week income replacement benefits

To succeed, Ms. Lee must establish on a balance of probabilities that she suffers a complete inability to engage in any employment for which she is reasonably suited by education, training or experience as a result of the motor vehicle accident.¹⁵

Adjudicators have rejected a literal interpretation of the complete inability test because that would exclude all but the most catastrophically injured accident victims from entitlement.¹⁶Instead, the language must be given a reasonable construction.¹⁷ "Somehow the ability to engage in a reasonably suitable job, considered as a whole, including reasonable hours and productivity must be addressed."¹⁸ Total disability does not mean absolute helplessness or inability to do anything or absolute lack of earning power ...¹⁹

Complete inability does not require the degree of impairment that is as high as a "catastrophic impairment" so as to preclude legitimate claims for ongoing disability, nor so low as a "substantial inability," as that would encourage specious claims after the first 104 weeks.²⁰The Director of Arbitrations has approved this approach.²¹

Pre-accident condition

Based on Dr. Delaney's opinion, I find that at the time of the accident, Ms. Lee's spine was susceptible to injury. She had bilateral spondylolysis of her lumbar spine, which was likely a congenital condition. She also had degenerative disc disease in her neck and low back which became symptomatic during the year before the accident, when she began working at London Life in 1998. At that time, she experienced low back pain and some neck pain. She had seven chiropractic treatments for pain relief. In the opinion of Dr. Deathe, Ms. Lee was then work hardened as a result of her activity on the job. I accept Dr. Deathe's opinion.

The mechanics of the accident

When Ms. Lee fell on the bus, she landed on her knees with one leg on a higher step, and the other on a lower step, with her back twisted. Dr. Neely, chiropractor who first treated Ms. Lee after this accident, described the fall as "severe." I accept his opinion. I also accept the opinion of Dr. Delaney, Ms. Lee's physiatrist, that the mechanics of her fall likely contributed to the severity of her injury and the prolonged nature of her pain and symptoms.

Ms. Lee's response to treatment

Ms. Lee's injuries have been addressed by chiropractic, physiotherapy and psychological treatments, work hardening, aquafitness, medications, and heat. I find that throughout, Ms. Lee has been compliant and co-operative with treatment.

In March 1999, Ms. Lee's low back pain, described as "intermittent" before she began physiotherapy at the CBI in March 1999, was described as "ongoing generalized low back pain" at the conclusion of the program. After three months of physiotherapy at the Accident Injury Management clinic in 2001, Ms. Lee felt that her back pain was worse than before. That pain became constant.

Dr. Neely, chiropractor who treated Ms. Lee in the year before the accident and at various points following the fall on the bus, described the chronic problems Ms. Lee faced. In his opinion, her symptom complex of constant low back pain, left sciatica, occasional right sciatica, mid-thoracic neck pain and sleep disturbances related to her need to change positions for comfort remained unchanged. Although she had been through physiotherapy, work hardening and rehabilitation sessions, in his opinion these approaches had backfired, with the exception of the water exercise program. Other than water-based exercises, Dr. Neely saw little point in recommending further chiropractic or massage therapy until she experienced some increase in her muscular tolerance.

Ms. Lee's complaints of pain, stiffness and limitations in her ability to walk, sit and stand are documented in her activities of daily living form which she completed in February 1999. Her complaints have continued and have worsened over time. In March 2000, Dr. Maddeford identified additional limitations with twisting of her lower back and of her neck and her problems with sleeping, mild anxiety and depression. In January 2003, Dr. Maddeford opined that she had limitations in lifting, walking, sitting, bending, and standing due to her low back problems, and somewhat decreased energy and stamina. In his opinion, Ms. Lee's prognosis was poor.

I find that despite Ms. Lee's compliance and active participation in recovery, she has not obtained relief from her low back pain. She was able to improve her tolerance of activity for a period of time but this then regressed. Her range of motion became less restricted in some ways, then deteriorated in others. On the whole, her response to treatment has been disappointing.

Attempts to return to work

During a work hardening program in November 1999, Ms. Lee was encouraged to look for work and did so. According to CBI's notes, Ms. Lee spoke with a printing company and that employer had work available that was similar to what she had done pre-accident. Dr. Neely's note of November 23, 1999, states: "Same old thing. Worked 22 days—was enough."

I understood from this note that Ms. Lee attempted, but was unable, to return to work. The note also conveys that this was not her first attempt to do so, and some degree of discouragement. This was sedentary work, and less demanding work than the light work the exercise therapist, who conducted a functional capacities evaluation ("FCE"), opined that she could perform earlier that same month in November 1999.

FCEs are based on inference. Based on the ability to perform certain tasks on a given day for a limited period of time, an assessor infers that a person will be able or unable to do the job day in and day out. The FCE in question lasted two hours. Ms. Lee's actual attempt at sedentary work in November 1999 lasted for two and a half days. While she was able to expand the length of time she was able to stand, sit and walk, I find this did not translate into an ability to perform sedentary work on a sustained basis.

It is interesting to note that at the time of the November 1999 FCE, Ms. Lee's low back flexion had regressed to 73 degrees. At the completion of the CBI physiotherapy program in July 1999, it had been 85 degrees. Similarly, in November 1999, Ms. Lee's low back extension had regressed to 22 degrees in November 1999 from 32 degrees at the conclusion of the CBI physiotherapy program.

While Ms. Lee was able to improve her sitting tolerance in 1999 to up to two hours, in March 2001, when she saw Dr. Delaney, a few months after the post 104-week test became applicable, her sitting tolerance was reported at 20 minutes.

Dr. Delaney testified she saw Ms. Lee on a number of occasions. Her sense was that Ms. Lee was presenting in a genuine way and there was no reason to disbelieve her. Dr. Delaney testified that she was constantly looking for inconsistency; however, Ms. Lee passed all the tests designed to determine whether she was faking. I accept Dr. Delaney's opinion.

In 1999, Ms. Lee was already restricted in 3 positions—sitting, standing and walking. In Dr. Delaney's opinion, realistically, not many more positions were left, and a person had to assume some position in order to do work. As noted above, Ms. Lee has additional limitations of twisting her neck and her low back and she develops pain with static neck positions. She also has limitations with lifting, bending, and problems with sleeping, mild anxiety and depression, somewhat decreased energy and stamina, and had a poor prognosis.

I am not persuaded that Ms. Lee could perform sedentary work in November 1999 when she was discharged from the work hardening program by CBI on the basis that she was able to perform light work. The strength requirement for sedentary work is lifting up to 10 pounds occasionally; for light work the strength requirement is lifting up to 20 pounds occasionally. There is a further requirement for sedentary work, namely, that the majority of the work must be performed while seated.²² Dr. Delaney testified that if a person has trouble with extension, by definition she would have trouble sitting and lifting above shoulder level. I accept her opinion.

Ms. Lee testified that she attempted to work at Tim Horton's, but found that work too fast paced and just could not get the hang of it. It is not clear to me when she made this attempt.

Ms. Lee worked at Magg's Bindery between June 21, 2000 and July 6, 2000 collating and folding Christmas cards. The job involved prolonged standing and sitting as well as bilateral upper limb co-ordination. Ms. Lee found that this work increased the pain in her upper back because bilateral upper limb co-ordination was required. She also found that her relatively constant low back pain was worsened with the prolonged standing when collating materials and with the prolonged sitting she was required to do in order to complete some of the tasks. Ms. Lee worked for four 8 hour shifts, one 7.5 hour shift, one 4 hour shift, one 4.5 hour shift and one 3.5 hour shift.

Ms. Lee testified that this job lasted for one week, one and a half days. This was a sit down job. She used a box as a footstool to take the pressure off of her hips. She succeeded in making it through the day. However, she did not believe she could do this job long term. She would have a problem with the ongoing sitting, bending and stooping over the table.

Between November 7, 2000 and December 18, 2000, Ms. Lee also worked at Wal-Mart as a customer service clerk in the seasonal department. She helped to keep the shelves tidy, to clear debris off the floor, to put merchandise back into boxes and assisted customers. The job involved constant standing, except for her breaks and lunch. She had no choice in the hours or length of the shift. Ms. Lee testified that she was pretty sore at the end of a shift, and would increase her medication during the day to help to alleviate some of the pain in her back. Still, by the end of the day, she could hardly move because she was so stiff and sore. This worsened over time while on the job.

At Wal-Mart, Ms. Lee's shifts ranged from 42 hours to 8 hours. She averaged 26 hours a week with the maximum being 38 hours during the week of November 26, 2000. The clinical notes and records of her family physician support her difficulty in working a full day and her increased consumption of pain medication at Wal-Mart.

Ms. Lee testified she was able to avoid lifting heavier items, such as Christmas trees, by asking one of the men who worked in another department to assist the customers who needed help with boxes of Christmas trees. Ms. Lee completed the season, and received a good to excellent job performance rating from her supervisor. Ms. Lee testified that she liked the job and the people. She testified she could not do it on a full-time basis or long term because of the prolonged standing which was required.

On May 15 and 16, 2001, Ms. Lee worked for a day and a half at a book bindery.

Certas submits that Ms. Lee's attempts to work at Wal-Mart demonstrate that she does not meet the test for post 104-week benefits, since the prolonged standing at that job exceeded the restrictions which Dr. Deathe imposed on sedentary work, as detailed below. This submission ignores the toll that job took on Ms. Lee. For the reasons detailed below, I am not persuaded that Ms. Lee could perform that job on a long-term or ongoing basis.

In this regard, I also note that the test for post 104-week benefits does not contain any requirement or refer to any definition that requires Ms. Lee to be "continuously" prevented from working. I agree with the arbitrator in the Lombardi case, that the drafters did not intend periodic work to necessarily bar benefits in relation to the overall analysis of a work disability.

The Magg's and Wal-Mart jobs were arranged for a specific duration and Ms. Lee worked until the jobs were over. I find they were nevertheless bona fide attempts on Ms. Lee's part to return to the work force. I find that Ms. Lee used her initiative and applied strategies to modify and adapt her work to her impairments without the benefit of an occupational therapist, job coach or employer.

Ms. J. Kobayashi, the vocational expert retained by the Applicant, opined that based on her 15 years of experience in the field, Ms. Lee made a reasonable effort to find employment. I accept her opinion.

Suitable work

Ms. Lee was 49 years of age at the time of the accident, and 51 years of age at the post 104-week mark. She completed a commercial program at high school and graduated in 1968 with a grade 12 education. Following graduation, she worked full-time and part-time as a keypunch operator performing data entry work for about 19 years at London Life, Sears and BDP Business Data Service. She stayed home with her children for about four years and was out of the work force between 1991 and 1995 due to a frozen shoulder, a down turn in the economy and for personal reasons.

In November 1995, Ms. Lee began working through temporary agencies and did clerical work and light labour jobs. These involved collating, shrink-wrapping and hole punching various items. This work was sporadic.

In February 1998, Ms. Lee began working at London Life where she worked for about 11 months. Initially, she was placed there as a temporary employee and worked in the printing department. London Life then hired her on a contract. In about November 1998, she began working at another position on a different floor as a conversion clerk performing light industrial work.

Ms. Lee has done keypunch work for approximately 19 years. There is little, if any, demand for keypunch operators in the London area. In light of her education, training and experience, I find clerical work and light industrial work to be suitable for Ms. Lee.

The Applicant's medical evidence

Dr. Neely, Ms. Lee's chiropractor, and Dr. W. R. Maddeford, her family physician for over 30 years, are of the opinion that Ms. Lee has substantial physical impairments in her neck, thoracic and lumbar areas which restrict her ability to work at any occupation for which she was reasonably suited. Dr. Maddeford opined that Ms. Lee's condition was not significantly different in 2002, from 1999, although she perhaps had a bit more pain.

In March 2000, Dr. Maddeford identified additional limitations, namely, twisting her lower back and neck and problems sleeping, mild anxiety and depression. In November 2000, just around the time Ms. Lee began work at Wal-Mart, Dr. Maddeford authored a note that "For medical reasons, [Ms. Lee] may only work 4-5 hours at a time." In January 2003, he certified to the Ministry of Community and Social Services that Ms. Lee was permanently unemployable on medical grounds and unlikely to commence remunerative employment. He opined that she had limitations in lifting, walking, sitting, bending, and standing due to her low back problems, somewhat decreased energy and stamina, and had a poor prognosis.

Dr. Delaney

Dr. Maddeford referred Ms. Lee to Dr. Delaney, a physiatrist, because of her ongoing complaints of low back pain in March 2001. Dr. Delaney saw Ms. Lee on a number of occasions. In her opinion, while Ms. Lee could work for a short period of time if there was an end in sight; in the real world she would be significantly handicapped because she would not be able to sustain employment. In her opinion, training would not change the sustainability problem.

In December 31, 2002, Dr. Delaney reported that "In my opinion, Ms. Lee is not capable of pursuing, with any frequency, remunerative occupation. While there are no safety issues, I believe there is a definite issue of competitiveness and consistency. ... Unfortunately, I see her problems as permanent and unlikely to change. I see her as medically unemployable now and in the foreseeable future."

Dr. MacDonald

Dr. Maddeford referred Ms. Lee to a psychologist, Dr. M. R. MacDonald, who treated her in relation to her chronic pain syndrome. In November 2002, Dr. MacDonald opined that while treatment has helped reduce some of Ms. Lee's suffering, it had not increased her capacity for returning to work. She had tried to return to work on several occasions but had been unable to sustain these activities.

Dr. MacDonald opined that Ms. Lee was not capable of any type of regular employment, even on a part-time basis. He concluded that Ms. Lee has underlying physical impairments as a result of her injuries and, in his opinion, this is a permanent problem. Dr. MacDonald opined that work is a sustained activity which leads to flare-ups. Increased activity sets up a pattern of increased pain, which builds each day, to the point where Ms. Lee is no longer able to cope. In his opinion, Ms. Lee's "injuries are permanent and severe and limit almost all aspects of her day-to-day life."

I find the Applicant's health practitioners have provided considered opinions, from a number of perspectives, formed over time, in light of Ms. Lee's impairments, her response to treatment and her attempts to return to work. I find their opinions should therefore be given considerable weight.

The Insurer's medical evidence

Dr. Williamson

Certas arranged an insurer's examination by Dr. P. Williamson, a psychiatrist, which took place on November 18, 2002. He saw Ms. Lee on one occasion. Dr. Williamson diagnosed pain disorder with both psychological factors and a general medical condition, chronic pain. While Dr. Williamson was of the opinion that Ms. Lee was not disabled for psychiatric reasons, he opined that she still had a long way to go in relation to dealing with her chronic pain. Dr. Williamson was supportive of cognitive behavioural treatment and recommended a trial of Amitriptyline.²³ Dr. Williamson opined that "with regard to vocational rehabilitation, I think that it would be important to set some firm but fair guidelines for a graduated return to work based on limitations associated with her physical injuries as defined by a rehabilitation specialist."

Dr. Deathe

Dr. A. B. Deathe, a physiatrist, examined Ms. Lee on one occasion in October 2003 at Certas' request, and authored several reports. Dr. Deathe testified that his findings on examination were largely similar to those of the functional capacities evaluation done by CBI on July 6 and 7, 1999. In his opinion, Ms. Lee was capable of performing sedentary work involving lifting up to 10 lbs. on an occasional basis provided that she :

1Avoid prolonged sitting or standing;

2Avoid repetitive bending, stooping, twisting;

3Avoid repetitive lifting and carrying;

4Ensure that an ergonomic assessment is done for any seated work to maximize her work capacity.

Dr. Deathe testified that he foresaw that Ms. Lee would work in an office environment, with the flexibility to sit or stand, with limited reaching and carrying of heavy files. He foresaw that she would do one activity for 30 minutes, then take a break by switching to a different activity for about five minutes. She could then either resume the original activity or perform a different one.

Vocational evidence of the Insurer

Mr. Antfiick

Mr. D. Antflick, a vocational rehabilitation expert retained by Certas, testified that using the restrictions imposed by Dr. Deathe, he was able to identify a number of positions which he felt met Dr. Deathe's criteria, namely: telephone survey interviewer, telemarketer, ticket taker/usher, tanning salon attendant, hotel front desk clerk, customer service clerk, receptionist in a beauty salon, real estate office, athletic club, answering service operator and a ticket clerk.

Vocational evidence of the Applicant

Ms. Kobayashi

The Applicant's vocational expert, Ms. J. Kobayashi, opined that of the eleven positions which Mr. Antflick identified as suitable, six positions are sedentary, while the remainder are light work, and therefore outside of the parameters set by Dr. Deathe. In her opinion, all of the sedentary positions proposed require sitting. In the case of the telephone operator job, the only stated physical requirement was sitting; one job involves sitting, standing and walking; while the remaining jobs involve sitting as well as bilateral upper limb co-ordination.

Ms. Lee has impairments in relation to each of these physical requirements. Ms. Lee found that she developed pain and stiffness when she did work which required bilateral upper limb co-ordination at Magg's Bindery.

Dr. Deathe proposed that Ms. Lee rotate through a series of activities on the job. I find that rotating activities can provide a period of rest, prevent fatigued muscles, and thus enhance endurance and increase the ability to work. I find that while that approach may succeed where a person has restrictions in one activity, Ms. Lee has significant impairments in each of the series of activities through which she will be rotating. In addition, her level of stiffness increases during the day. In light of her impairments and increasing stiffness, I am not persuaded that she will experience enough enhanced endurance to permit her to work on a sustained basis. I am also not persuaded that she will be able to tolerate the escalating levels of pain described by Dr. MacDonald.

Ms. Lee testified that she has never tried work which corresponds with the restrictions which Dr. Deathe recommended. She knows she cannot do it and is not prepared to start a job knowing that she will be leaving an employer in the lurch. Ms. Lee made attempts to return to work in 2000 and failed repeatedly. Dr. Deathe's report was prepared in 2003. Given the gap in time between Ms. Lee's attempts and Dr. Deathe's opinion, I find that further attempts would be a daunting prospect for Ms. Lee.

Analysis and conclusion re post 104-week IRBs:

In order for Ms. Lee to return to work within the restrictions set by Dr. Deathe, she must firstly find an employer who, with knowledge of her injury, will hire her and provide the recommended accommodation. Secondly, she must be able to sustain competitive employment.

Dr. Delaney, Dr. MacDonald, Dr. Deathe and Ms. Kobayashi agree that Ms. Lee faces a real challenge in finding employment. Ms. Lee was 55 at the date of the hearing. These witnesses all agree that her age alone would make it hard for her to find work. As an older employee, she is less resilient. She has a high school education and chronic pain difficulties.

An additional factor is the length of time Ms. Lee has spent out of the work force following her injury on the bus. Dr. MacDonald referred to the literature which shows that in the vicinity of 5% of persons who have been away from work for more than a year following an injury return to work. That percentage decreases the longer a person is off work. Dr. Deathe agrees with Dr. MacDonald on this point. At the 104-week mark, Ms. Lee would have been away from the work force for two years; at the time of the hearing, the gap was approximately five years. Ms. Kobayashi noted Ms. Lee's dated skills as a keypunch operator as a further barrier to being hired. Her memory difficulties will prove an additional challenge in learning the requirements of the job.

Drs. Delaney, MacDonald, Deathe and Ms. Kobayashi also agree that injured persons have difficulty finding work because once they disclose the injury, employers balk. Employers are leery that the injury will have a negative impact on the person's productivity, attendance and reliability. They are also wary of attracting workers' compensation and disability claims.

Their evidence was confirmed by Mr. M. Tapping, Ms. Lee's supervisor at Wal-Mart, who Certas summonsed. Mr. Tapping testified that he had been unaware of Ms. Lee's low back injury, and, had she disclosed it at her interview, that would have "pretty much ended the interview, right there." Ms. Kobayashi noted that in order to get the ergonomic chair and accommodation at work which Dr. Deathe specified, Ms. Lee would have to disclose her injury. Once she discloses this, it is unlikely that she will be hired.

In a way, Mr. Antflick's opinion confirms the extent of the difficulty Ms. Lee will face in finding suitable work. He contemplates an arduous job search:

In order to secure employment, Ms. Lee would be well advised to conduct an intensive, persistent and relentless job search .... If she at first fails, she should be encouraged to start again and again until she finds a suitable position.

I would suggest to Ms. Lee that if a prospective employer showed even the slightest interest in hiring her, she should offer to work without pay for several months while she learns the duties and demonstrates her suitability for them. I would warn her that she would have to apply to a lot of places and be fortunate to secure a suitable position but it would be worth her while to make the effort. This would be a worthwhile way to get back into the workforce and, in a sense, "cleanse" the prolonged absenteeism from her resume.

Employment involves an exchange of time and work for compensation. It is not employment if there is no payment.

Mr. Antflick also recommended that Ms. Lee consider self-employment involving answering telephones in a home office. This would allow her to change positions at will. Mr. Antflick noted that Ms. Lee's success will depend on her ability to market her services and obtain clients, and that until she became established, she might have difficulty obtaining a wage comparable to what she earned pre-accident. I find no evidence that Ms. Lee has any of the requisite skills for marketing, obtaining clients, billing, collecting accounts and running a business. I find that in most cases, self-employment would be such a different enterprise from regular employment, that the two cannot be equated.

Although Ms. Lee succeeded in obtaining employment in 1999 and in 2000, she did so without disclosing her injuries and impairments. I find it unlikely that Ms. Lee will succeed in finding work within the parameters set by Dr. Deathe.

However, should she succeed, Ms. Lee then faces the problem of sustainability—the ability to go into work day after day and perform the same job on a consistent, productive basis, having the stamina and the ability to tolerate increasing levels of pain.

Dr. Delaney opined that all of the positions identified by Mr. Antflick were suitable work. While Ms. Lee could do such work on a short-term basis, with increasing stiffness, pain and medication, she would be unable to sustain going into work and performing it for a reasonable length of time. I find Ms. Lee amply demonstrated the problem in her attempts to return to work. I also find that Dr. MacDonald's analysis of Ms. Lee's experience of escalating levels of pain and stress with increased activity, explains how it is that Ms. Lee is able to cope with some activity, such as work, and why her pain levels mean that work eventually becomes intolerable.

The parties' dispute is primarily about the inferences they draw concerning Ms. Lee's ability to work at any suitable occupation given her impairments. In resolving this question, I have considered that Ms. Lee had a vulnerable spine at the time of the accident. She sustained a severe fall on the bus, the mechanics of which likely contributed to the prolonged nature of her pain. Despite her participation and compliance with various types of treatment, her results from treatment were disappointing.

Ms. Lee has a number of impairments involving her low back which will have a significant impact on her ability to work in a seated position. She also has impairments in her cervical and thoracic spine. Thus all three major regions of her spine are affected. Ms. Lee has attempted to return to work following the accident, and has not been able to tolerate sedentary work because of her levels of increasing pain. Since February 1999, she has consistently complained of problems with her low back and restrictions in sitting, standing and walking. Those impairments have worsened over time.

I accept that Ms. Lee has the pain and the restrictions of which she has complained. I find that Dr. Deathe was not always provided with a full picture of Ms. Lee's circumstances. For example, while he was aware she worked at Wal-Mart and received a good to excellent performance rating, he learned only at the hearing of the toll that work took and of her need for increased medication. On balance, I prefer the opinions of her treating practitioners. I am not persuaded that Ms. Lee can engage in employment in suitable work on a competitive, sustained basis, given her impairments. For these reasons, I conclude that Ms. Lee meets the post 104-week disability test and is therefore entitled to post 104-week income replacement benefits, commencing January 9, 2001

INTEREST:

Ms. Lee is entitled to interest on overdue benefits pursuant to section 46(2) of the Schedule. I remain seized of the amount if the parties are unable to agree.

SPECIAL AWARD

Section 282(10) of the Insurance Act requires an arbitrator to order 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.

Ms. Lee claims a special award. I find Ms. Lee is entitled to a special award on two grounds. Firstly, when Certas terminated her income replacement benefits in December 1999, it failed to provide her with information in writing about the procedure for resolving disputes relating to statutory accident benefits which it is required to provide under section 49 of the Schedule.

The requirements of section 49 apply whether or not the insured person is represented by counsel. Ms. O'Neil, the file handler, acknowledged in cross-examination that while there was some indication in the file that Ms. Lee had a lawyer representing her prior to the termination, his role was limited and unclear.

Section 49 is an important provision. It is important that insured persons know what recourse they have and the steps they can take if they disagree with the termination of their benefits.

Certas terminated Ms. Lee's income replacement on December 3, 1999, effective December 20, 1999, based on a discharge summary provided by CBI in November 1999. That summary was prepared after a two-hour FCE. Ms. Lee attempted a return to work following her discharge from that program, but found that she was unable to work by November 23, 1999.

Following the termination of her income replacement benefits, Ms. Lee claimed physiotherapy treatment, psychological treatment and a swimming pool membership, and Certas paid for these medical and rehabilitation benefits. However, she did not pursue her claim for IRBs until she retained new counsel in August 2000.

In August 2000, Ms. Lee retained Mr. Good as counsel. He approached Certas on the basis that it had applied the wrong test in terminating her benefits. Instead of responding on the merits that this was incorrect, Certas alleged that Ms. Lee declined to participate in the job site evaluation. This, too, was incorrect. However, I find it was clear that further IRBs were in issue and Certas again offered a disability DAC to Ms. Lee if she wished to dispute the stoppage.

The second ground for the special award relates to Certas' delays in adjusting and assessing Ms. Lee's claims for pre 104-week income replacement benefits. The Applicant submits that Certas unreasonably withheld and delayed her IRBs and did not reinstate them until January 2004.

Arbitral case law establishes that an insurer is required to consider further medical evidence provided by an insured. A treating provider may also submit such medical information. An insurer may accept that evidence at face value. An insurer is also entitled to arrange its own assessments to determine entitlement to a benefit.

Section 35 of the Schedule contemplates prompt determination of entitlement to income replacement benefits and payment in relation to those benefits within 30 days of submission of a claim. It follows that if an insurer chooses to arrange insurer examinations, these arrangements should take place within a reasonable time frame.

I find that Certas did not accept the Applicant's opinion evidence which supported disability in July 2001. I find there were unreasonable delays in arranging insurer examinations commencing in July 2001.

The Applicant submits that Certas' delays commenced in February 2001, based on Dr. Maddeford's attending physician's statement of total disability. While I accept that the certificate was sent to IOF, I find no indication that it was sent to Certas before October 9, 2002. The Applicant submitted that Certas again denied income replacement benefits in April 2001. There is a letter of April 10, 2001 from Certas to counsel for the Applicant which states, "We are unable to consider payment of any further Income Replacement Benefits at this time." Certas also offered Ms. Lee the opportunity of a further disability DAC assessment in that letter. I am not persuaded, however, that this was in response to a certificate from Dr. Maddeford.

On July 25, 2001, Dr. MacDonald provided Certas with a report which elaborates on Ms. Lee's need for a program of pain management and rehabilitation counselling. Dr. MacDonald documents in narrative form Ms. Lee's trial returns to work in July 2000 and in November and December 2000, and her inability to continue working due to escalating pain. He reported, "She feels a diminished sense of control over her life and feels less secure, given the loss of her capacity to work ... It is clear that there has been widespread disruption to her life, especially in relation to the loss of capacity to work and her related financial strain."

I find that at this point, July 25, 2001, Certas had the Applicant's context for the significance of the declaration of post-accident earnings submitted in March 2001, as well as medical evidence which, if accepted, supported her entitlement to income replacement benefits during at least a portion of the pre 104-week period, July 2000 to January 8, 2001. Certas accepted Dr. Macdonald's treatment plan. However, it was only in September 2002 that it arranged for an insurer's examination in relation to her chronic pain disorder by Dr. P. Williamson, a psychiatrist. The appointment was scheduled for November 18, 2002.

Dr. Williamson opined Ms. Lee was not disabled for psychiatric reasons, but recommended that Certas negotiate a graduated return to work with her, with the input of a rehabilitation specialist. Dr. Williamson's report contemplated a 3 to 6 month graduated return to work period once litigation was out of the way. I find no evidence that Certas pursued Dr. Williamson's recommendation to obtain the input of a rehabilitation specialist until July 2003.

Ms. Lee first saw Dr. Delaney, a physiatrist, on March 31, 2001 on a referral from her family physician, Dr. Maddeford. Dr. Delaney sent her first three reports to him. I agree with the submission of counsel for the Insurer that Dr. Delaney's report of December 31, 2002 was the first of her reports which addressed the issue of Ms. Lee's disability.²⁴ Certas submits it received that report from counsel for the Applicant in March 2003.

I find Certas received Dr. Delaney's report dealing with disability on March 12, 2003 and arranged an insurer's examination with Dr. Darracott in Hamilton on July 18, 2003, after about four months. Ms. Lee objected to this assessment, and counsel for the parties eventually agreed that Dr. Deathe, a physiatrist in London, would conduct the assessment. That assessment was scheduled for October 29, 2003. There is a note indicating that the file handler attempted to do this earlier; however, Dr. Deathe was out of the country. I am not persuaded that it was reasonable to require Ms. Lee to travel to Hamilton from London for an insurer's examination and for that reason also attribute the resultant delays to Certas.

I am not persuaded that a reasonable explanation was advanced for the delay in arranging the assessments, assessing her entitlement to benefits and paying the benefits between July 2001 and January 2004. Arbitral case law establishes that mere delay is compensable by interest; unreasonable delay and withholding of benefits will give rise to a special award.

When Certas did not accept Dr. MacDonald's opinion that Ms. Lee lacked the capacity to work in the pre 104-week period, its delay of over a year in obtaining its own assessment in that regard was unreasonable. I also find that Certas' delay in obtaining the input from a rehabilitation specialist as recommended by Dr. Williamson unreasonable. I find the delays in adjusting Ms. Lee's claim were unreasonable, and that these delays unreasonably delayed payment of her pre 104-week income replacement benefits.

Once Certas had Dr. Deathe's opinion in November 2003 that Ms. Lee met the test of entitlement to income replacement benefits in the pre 104-week period, it was obliged to pay her outstanding IRBs to the two-year mark. There was then a further delay of about six weeks until January 2004 when Certas paid Ms. Lee IRBs to the 104-week mark, less the IOF policy proceeds.

Certas explained there were three aspects to the delay, although I do not know the length of delay attributable to each. Certas explained that Ms. Lee's file was being reported to head office, and there was a delay in obtaining authorization to pay the funds; that the Christmas holiday period intervened and that it was necessary to retain an accountant to calculate the amount of interest.

I do not fault Certas for retaining an accountant to calculate the amount of interest to be paid. However, it could have paid the principal amount of income replacement benefits in November 2003, following receipt of Dr. Deathe's report. The same holiday period that Certas cites as a mitigating circumstance, is likely an aggravating circumstance for Ms. Lee who would want to be in funds prior to the holiday period. Given the time frames under the Schedule for adjusting benefits, an internal reporting system to authorize payment of income replacement benefits ought not to take six weeks.

As mitigating circumstances, I have considered that Certas paid the IRBs with interest and that it assisted Ms. Lee in obtaining medical and rehabilitation benefits following the termination of her income replacement benefits when she was unrepresented by counsel.

In January 2004, Certas paid Ms. Lee's income replacement benefits from December 21, 1999 to January 8, 2001, a period of 54 weeks and 4 days. Her benefit rate was $258.68 per week. Working backwards from the total amount paid, approximately $13,625.56 was IRBs and $10,174.44 was interest. In the circumstances, I find Ms. Lee is also entitled to a lump sum special award in the amount of $1,500.

In the interests of completeness, I find Ms. Lee is not entitled to a special award in relation to post 104-week income replacement benefits because Certas had opinion evidence which supported its position.

EXPENSES:

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

June 15, 2006

Suesan Alves Arbitrator

Date