Financial Services Commission of Ontario
Commission des services financiers de l’Ontario
Neutral Citation: 2007 ONFSCDRS 200
Appeal P06-00040
OFFICE OF THE DIRECTOR OF ARBITRATIONS
COSECO INSURANCE CO./HB GROUP/DIRECT PROTECT Appellant
and
SUZANNE HILL Respondent
BEFORE: David Evans
REPRESENTATIVES: Pradeep B. Pachai for Coseco David J. Gillespie for Ms. Hill
HEARING DATE: April 5, 2007
APPEAL ORDER
Under section 283 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
The appeal is dismissed and the arbitrator’s order dated November 10, 2006 is confirmed.
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.
October 17, 2007
David Evans Director’s Delegate
Date
REASONS FOR DECISION
I. NATURE OF THE APPEAL
In a decision dated November 10, 2006, the arbitrator awarded Mrs. Hill about $60,000 towards a new home to accommodate her needs. He also imposed a special award pursuant to s. 282(10) of the Insurance Act. The insurer appeals the special award.
II. BACKGROUND
A special award is payable if an arbitrator finds that the insurer has unreasonably withheld payment of benefits. In this case, the insurer’s decision to withhold the benefit, which was based on both substantive and procedural grounds, led the arbitrator to make that finding.
Although this claim centered on whether it was reasonable and necessary for Mrs. Hill to incur the costs involved in moving to a new home,1 much of the evidence concerned the potential costs that would have been involved in making the old home – which was on Linden Court in Oshawa – reasonably accessible.
At the time of the accident, Mrs. Hill was living in a five-level, single family house, with the primary living space on four different levels plus a sunken foyer at the front door. In a relatively high-speed collision to the left front of her vehicle on June 16, 2000, Mrs. Hill suffered a number of injuries. The most serious permanent injury was a right ankle fracture dislocation that left her with ongoing pain and mobility problems. As an example of the medical evidence, Dr. Geoffrey Lloyd conducted an insurer’s exam on September 25, 2001. He noted that this was a high violence injury that was difficult to manage and left permanent effects. He found that Mrs. Hill had limited endurance, would not be able to climb, kneel or squat, and any activities involving those movements would be compromised.
Mrs. Hill’s mobility in the old house became an issue. On April 16, 2002, she had her first exam with Dr. J. Ogilvie-Harris, arranged by her counsel, who concluded that she is always going to have a stiff painful ankle even if an ankle arthrodesis were carried out and that, among other limitations, she will have difficulty going up and down stairs. On August 15, 2002, Natalie Connolly, O.T. with Carol Bierbrier & Associates, produced an occupational therapy in-home report on behalf of Mrs. Hill. This first Bierbrier report noted Mrs. Hill’s difficulties with weight bearing, stair climbing, kneeling and squatting as a result of her limited ankle range of motion and that Mrs. Hill’s most significant barrier in her home was the numerous flights of stairs. Ms. Connolly wrote: “During this assessment Mrs. Hill was observed stair climbing using a slow step to gait pattern. She was also observed using the wall and railing for support and face side ways due to limited ankle flexion.” The Bierbrier report was forwarded to Dr. Ogilvie-Harris, who in a letter of October 8, 2002, confirmed the difficulties the flights of stairs caused Mrs. Hill and stated: “Clearly, in my opinion, from a medical point of view, she would benefit from having a bungalow home without stairs.”
Dr. Ogilvie-Harris’s letter appears to have been the spur for Mrs. Hill. On August 8, 2003, she made an offer that was accepted for a “bungaloft” house where all of her necessary living space including bedroom and laundry was on the main level, with the second loft-type story designed as a guest area. On September 30, 2003, her lawyer wrote to the insurer asking it to fund the move by paying the difference in price between the two houses. On October 9, 2003, Coseco replied with an OCF-9 (Explanation of Benefits) refusing the claim and citing the Bierbrier report that Mrs. Hill was seen ambulating and stair climbing. The Bierbrier report thus became the substantive ground on which the insurer refused Mrs. Hill’s claim. The arbitrator noted at p. 8 of the decision that the insurer adopted the Bierbrier report