Commission des services financiers de l’Ontario

Neutral Citation: 2007 ONFSCDRS 63

FSCO A04-001040

BETWEEN:

FRED J. MACK

Applicant

and

KINGSWAY GENERAL INSURANCE COMPANY

Insurer

REASONS FOR DECISION

Before: Anne L. Sone

Heard: March 20, 21, 22, April 4 and September 6, 2006, in Kingston, Ontario.

Appearances: Paul A. Brioux for Mr. Mack Tricia McAvoy for Kingsway General Insurance Company

Issues:

The Applicant, Fred J. Mack, was injured in a motor vehicle accident on April 4, 2001. He applied for and received statutory accident benefits from Kingsway General Insurance Company ("Kingsway"), payable under the Schedule. Kingsway terminated weekly income replacement benefits on September 5, 2003 as a result of a disability assessment conducted by a designated assessment centre ("DAC"). The parties were unable to resolve their disputes through mediation, and Mr. Mack applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The issues in this hearing are:

Is Mr. Mack entitled to receive an income replacement benefit at a weekly rate not to exceed $400 from September 6, 2003 to present and ongoing, less his post-accident income pursuant to paragraph 5(2)(b) of the Schedule?
Is Mr. Mack entitled to payment for housekeeping and home maintenance services at a weekly rate not to exceed $100, from April 4, 2001 to April 4, 2003, pursuant to section 22 of the Schedule?
Is Kingsway liable to pay Mr. Mack's expenses in respect of the arbitration pursuant to subsection 282(11) of the Insurance Act?
Is Mr. Mack liable to pay Kingsway's expenses in respect of the arbitration pursuant to subsection 282(11) of the Insurance Act?
Is Mr. Mack entitled to interest for the overdue payment of benefits pursuant to subsection 46(2) of the Schedule?

Result:

Mr. Mack is entitled to receive an income replacement benefit at a weekly rate not to exceed $400 from September 6, 2003 to present and ongoing, less his post-accident income pursuant to paragraph 5(2)(b) of the Schedule.
If the parties cannot agree on the entitlement to or the amount of the expenses of this proceeding, they may request a date for a hearing on this issue by writing to the Commission within 30 days of the date of this order, in accordance with Rule 79 of the Dispute Resolution Practice Code (Fourth Edition - updated October 2003).
Mr. Mack is entitled to interest for the overdue payment of benefits pursuant to subsection 46(2) of the Schedule.

EVIDENCE AND ANALYSIS:

Background

At the start of the hearing, the parties advised me that they were not proceeding on the issue relating to housekeeping and home maintenance services. Accordingly, I make no ruling regarding this issue.

On April 4, 2001, Mr. Mack was riding a motorcycle, which was struck by a van. Mr. Mack was thrown off his motorcycle and suffered serious injuries to his left wrist joint. Mr. Mack is left-hand dominant. Surgery was required and included a bone graft from his right hip. He remained in hospital until April 7, 2001 and has had extensive physiotherapy. He still suffers from significant pain and impairment to both his left wrist and his right hip.

At the time of the accident, Mr. Mack was 42 years old. He lives near Kingston with his wife and children. Before the accident Mr. Mack had worked regularly as a hospital porter. He had also trained and worked occasionally as a paramedic. Just prior to the accident he completed training as a heavy equipment operator.

After the accident he found work driving a school bus during the school term and a water truck in the summer.

Law regarding Income Replacement Benefits - Statutory Framework

The issue I have to decide is whether Mr. Mack is entitled to income replacement benefits after September 6, 2003.

Under paragraph 5(2)(b) of the Schedule, I must answer the following question.

As a result of the accident, does Mr. Mack suffer a complete inability to engage in any employment for which he is reasonably suited by education, training or experience?

Mr. Mack's Credibility

Mr. Mack underwent a significant amount of testing. There was no suggestion in these tests that he engaged in malingering behaviour or symptom magnification in any way. His functional abilities evaluation in September 2001 noted the presence of full physical effort. He was also an intelligent, articulate witness, and there were no significant inconsistencies in his evidence. Kingsway did not challenge Mr. Mack's credibility. I find Mr. Mack to be a credible witness and accept his testimony which I find to be accurate and reliable.

Mr. Mack's Injuries, Treatment and Medical Status

Kingsway acknowledged and I find that Mr. Mack had suffered a significant fracture of his left wrist which has left him with residual limitations. Kingsway also does not take issue with the nature of treatment for this injury.

Mr. Mack testified and I accept that surgeons attempted numerous times to set his comminuted (multiple splinters) intra-articular (in the joint) wrist fracture with screws and K-wires. Since the results were unsuccessful, they extracted some bone from Mr. Mack's iliac crest (right hip). They then ground this bone into a paste-like material and used it as a grout to hold the larger pieces of bone together. They added an internal volar plate to keep the pieces aligned as much as possible. The surgeons used an open reduction and internal fixation procedure. In addition, Mr. Mack had his carpal tunnel released to prevent nerve compression injuries.

After approximately six weeks, the external hardware was removed, and Mr. Mack was able to start physiotherapy. The internal hardware remains in his left wrist. This wrist has bone scarring within the joint sliding surfaces. It is also impaired in all aspects of wrist movement, has post-traumatic osteo-arthritis and hypersensitivity at the site of the left wrist scar. Mr. Mack has residual numbness in his left thumb. He also suffered a right great toe fracture.

Mr. Mack's medical records indicate that he reached his maximum recovery approximately one year post-accident with significant deficits impairing both the left arm and right hip areas. Mr. Mack stated that his pain level varies over the course of the day from 3 out of 10 to 7 out of 10 (10 being the worst) depending on the weather and his activity level. He has received injections and regularly takes medication for pain and to reduce swelling. He confirmed that he has not taken narcotic medication since immediately after the accident. He also testified that he does not sleep well due to pain and the movement of the water bed he uses to relieve pressure on his joints. He frequently naps during the middle of the day to catch up on sleep he has missed overnight.

Mr. Mack's ability to manipulate his left wrist and his wrist and grip strength are severely decreased. His wrist pain interferes with any activities requiring gripping, lifting, pushing and carrying. He is unable to tolerate jarring or vibration particularly well. During the hearing, I frequently observed Mr. Mack cradling his left wrist with his right arm. As he is left-hand dominant, he is unable to write for more than one to two minutes without taking a break for five to ten minutes. His writing duration decreases during extended sessions.

The residual pain in Mr. Mack's right hip is aggravated with extended walking or sitting. He is able to walk for about 15 minutes and sit for 30 to 90 minutes, depending on how much he is able to shift himself in his chair. He has to change his gait to deal with the pain. He has residual numbness and tingling in his right hip.

Mr. Mack's Education

Mr. Mack has completed grade 13 and a one-year program at Algonquin College for an Emergency Medical Care Assistant certificate. He holds an AZ driver's licence which entitles him to operate a tractor-trailer. In 2000, he completed training as a heavy equipment operator for backhoe, excavator and bulldozer. He expected to earn approximately $20 per hour for this sort of work.

How Mr. Mack was employed before the accident

After graduating from Grade 13, Mr. Mack worked as an uncertified automotive radio service technician for 14 years.

Prior to the accident he had worked in the storage department at Hotel Dieu Hospital and at Kingston General Hospital. He also worked as a porter at Kingston General Hospital. Although he was not a full-time employee, he routinely performed this work for approximately 70 to 75 hours every two weeks, filling in for sick or vacationing staff. He was paid approximately $19.56 per hour, including benefits, for his work as a porter. Based on these figures, he earned approximately $35,000 to $38,000 per year for this work. In addition, he did a couple shifts each month as a casual part-time paramedic, and did some truck driving. Kingsway does not dispute that he can no longer do these jobs. He also performed with a band a few times each month.

Mr. Mack's employment after the accident

After the accident, Mr. Mack started to work again in December 2003. Initially, he worked at an inventory counting firm, and was paid $8.00 per hour. The shifts were four to six hours in length - on call, not full-time. Mr. Mack could not cope with the physical demands of this job and eventually had to leave it. He earned $285.53 from this job in 2004.

Mr. Mack currently works as a school bus driver for Stock Transportation during the school term. He finds this work quite accommodating in terms of his personal needs. It has a closed environment for temperature. The runs last approximately one and one-half hours. He is able to move his leg as needed to prevent his hip from seizing up. There is no cargo to load and unload. Since there is a large break between the morning and afternoon runs, it allows him the time he needs to relax and have a nap. This work pays $9.80 per hour. There are no benefits. Mr. Mack's statement of remuneration indicated that he earned $8,710.51 in 2004 and $10,778.37 in 2005 from Stock Transportation.

Mr. Mack drove a water truck during the summer of 2005. He was not able to do this job in 2004 and was unsure if he would have an opportunity to do it in the future. He delivered water for pools, wells, cisterns and road construction. The work is unpredictable and depends on weather. The drier it is, the more water goes out. The work days range from three to ten hours. Each trip delivering water lasts approximately 20 to 30 minutes. Then it takes an additional 20 to 30 minutes to unload the water during which he is able to walk, sit or stretch. There is no cargo for him to load or unload. He is paid approximately $11 per hour for this work. In 2005, his statement of remuneration indicated that he earned $8,866 from this job.

Mr. Mack still performs as a musician and currently earns approximately $500 per year doing this work; however, he is limited in the notes he can play, which limits the band in the pieces it can do. After performing, he finds himself in a lot of pain.

Vocational Assessments:

Cascade Disability Management, Inc.

Kingsway sent Mr. Mack for a transferable skills analysis ("TSA") at Cascade Disability Management, Inc. ("Cascade"). Cascade's vocational evaluator, Ms. Shirley Malcolm-Mac Innis, prepared an assessment dated August 29, 2002. Its purpose was to identify alternative occupations that Mr. Mack could potentially pursue for which he is suited by education, experience and reported functional abilities. The TSA consists of a nine-page report and 16 pages of charts summarizing pertinent occupational information. Ms. Malcolm-Mac Innis did not meet Mr. Mack; however, she did have a telephone conversation with him to review the report and confirm some details. She reviewed his personal circumstances, medical status, education, work experience, aptitudes and functional abilities. She also used tools such as computer software used to assist with the TSA, (Nelson's Professional Profile 2000), as well as the National Occupational Classification System and various wage and job opportunity surveys.

The TSA identified a number of possible occupations for which Mr. Mack may have an aptitude. The direct entry positions, mainly clerical or in sales, tended to be low-paying, at or around the minimum wage. Higher paying positions, such as medical laboratory technologist or technician, required retraining. The software generating the report was not specific enough in the area of physical capabilities to deal in a meaningful way with Mr. Mack’s specific and unusual limitations. For example, it listed the occupation of home inspector. However, I find that Mr. Mack does not have the physical ability to crawl in spaces as needed for this sort of occupation.

Ms. Malcolm-Mac Innis also stated at page nine of the TSA that:

Given Mr. Mack's physical limitations it is suggested that he would benefit from an ergonomic keyboard in order to be competitive for a number of the occupations listed below (customer service clerk, information clerk, and many of the occupations listed that would require further training).

Ms. Malcolm-Mac Innis explained during cross-examination that the TSA was not intended to cover whether these occupations were available in Kingston. She indicated that the area was covered in a Labour Market Survey dated December 14, 2004. This survey showed very limited availability in the Kingston area for the occupations listed in the TSA. For example, there are very few parking lot attendant positions available in Kingston.

Providence Continuing Care Centre

Mr. Mack, on his own initiative, went to Providence Continuing Care Centre ("Providence") for a Vocational Assessment and Vocational Exploration Activities. Ms. Janine Mels-Dyer, a Canadian Certified Rehabilitation Counsellor, issued a 19-page Vocational Assessment Report on behalf of Providence dated April 7, 2003. She reviewed and summarized various prior reports regarding Mr. Mack including the TSA, an occupational therapy assessment, a physiatry assessment, a functional capacity evaluation and a functional abilities evaluation. She also administered various counselling and assessment protocols. One of these was a transferable work content skills checklist. Mr. Mack testified that when he filled in the list he was instructed to check off items where he had performed that sort of task before, even if he had only done it once or could no longer physically do it. I find that simply because he checked off that he had done something in an isolated fashion on a previous occasion does not necessarily mean that he is competitively employable in that field. For example, Mr. Mack stated that during grade nine or ten, he had been briefly exposed to surveying and measuring land. In my view, that does not mean that he could find work as a surveyor without further training or that he was physically capable of performing this sort of work.

The Providence report also tested Mr. Mack's academic ability and concluded that he is currently working at or above his level of academic achievement.

The Providence report was of the opinion that Mr. Mack was capable of moving into many of the entry-level occupations identified in the TSA report of August 23, 2002. However, it also stated that all the entry-level occupations identified in the TSA would result in loss of earnings for Mr. Mack. Ms. Mels-Dyer states at page 14 of her report that:

The difficulty, in my opinion, with these occupations is that they provide wage remuneration that is significantly lower (minimum wage approximately) than Mr. Mack's $19.45 per hour pre-injury earnings.

The Providence report noted that Mr. Mack's vocational profile, his interests and his personality preference did not lend well to a sedentary and routine job profile. It stated that the occupations identified in this current assessment were not direct entry. For example, the occupations identified in the Choices CT 2003 Interest Profiler required additional training or skills enhancement.

Mr. Mack was interested in the health occupation field, particularly in the areas of medical laboratory technologist, respiratory therapist, medical radiation technologist, medical sonographer and cardiology technologist. The Providence report noted that all of these occupations would require further skills enhancement likely in the form of a three-year or longer college program. With the exception of medical laboratory technologist, all the programs would involve Mr. Mack relocating to another geographic area for the duration of the program. The report also stated that if Mr. Mack chose to participate in a form of skill enhancement/retraining, he would require support with note taking (scriber, dictaphone and adaptive computer software) as well as the need to identify himself with the special needs department of the facility.

Some of these potential occupations also required experience and expertise within the industry prior to being considered competitively employable in the field. Examples included railway transportation operations supervisor, specialist in public relations and communications, science policy and program officer, script assistant, radiological technologist, property administrator, pilot, nurse manager, motion picture projectionist, and industrial instrument inspector level.

Mr. Mack also expressed interest in working as a crane operator. Ms. Mels-Dyer researched this occupation and expressed concern about Mr. Mack's physical ability to handle essential components of the job such as operating the joystick and climbing the crane tower. In addition, it required an apprenticeship of a minimum of three and one-half years, followed by an examination.

Other occupations listed would not match Mr. Mack's training, experience or physical abilities with respect to his left wrist/hand limitations. These occupations included sign language interpreter, surface mining blaster, cable yard system operator, police officer, correctional security officer and sheet metal worker.

I find the conclusions in the Providence report to be well-researched and reasonable and, therefore, give it significant weight.

Capital Vocational Specialists Inc.

Mr. Mack attended a post-104 week disability assessment at Capital Vocational Specialists Inc. ("Capital"). Capital is a designated assessment centre and prepared a report dated August 11, 2003 ("the Disability DAC"). As part of this process, he was seen by a doctor for a medical evaluation in addition to undergoing a functional capacity evaluation ("FCE") by a kinesiologist. The DAC states at page 1 that given that a comprehensive vocational assessment took place at Providence approximately three months before, it was deemed unnecessary and inappropriate to retest Mr. Mack "within the relevant vocational domains."

The Disability DAC reviewed Mr. Mack's accident history, his medication, treatment, education and employment. It also summarized and discussed the findings of the Providence report as it applied to the DAC assessment. In addition, the Disability DAC referred to a list of transferable work content skills set out in the Providence report.

The DAC FCE, dated July 15, 2003, made conclusions based on computer generated workday tolerances, extrapolated from a questionnaire. For example, it states in bold print that Mr. Mack "should be able to sit on a constant basis over an 8+ hour workday." However, it also notes that "Mr. Mack reported pain in the right hip (3/10) after he had been sitting for approximately 40 minutes during the seated work activities with the ERGOS Work Simulator." I have concerns about extrapolating Mr. Mack's ability to do something for a short period of time and using that to say that he can do it for the entire day. In addition, there was no follow-up to see what his abilities were the following day, and if any increase in activities affected him.

The Disability DAC concludes that Mr. Mack did not suffer a complete inability to engage in any employment for which he is reasonably suited by education, training or experience.

It offered sample occupations for which it says Mr. Mack is reasonably suited including truck driver (i.e., tractor-trailer), dispatcher (i.e., emergency service or trucking firm), switchboard operator (i.e., hospital, unionized environment) and storekeeper. I find these sample occupations questionable given Mr. Mack's documented and acknowledged physical limitations. As noted above, I found Mr. Mack to be a highly credible witness. I, therefore, cannot rely on a computer generated workday tolerance which fails to take into account Mr. Mack's limited ability to sit without pain. Accordingly, I find that Mr. Mack is not able to engage in occupations which require lengthy periods of sitting such as truck driver, dispatcher and switchboard operator.

Further, I find that given his difficulties gripping, lifting, pushing and carrying as outlined above, he is not physically capable of performing the duties of a storekeeper in an employment situation. In addition, the entry level salary of $22,414 listed for the switchboard operator position would be substantially lower than Mr. Mack's pre-accident income of $35,000 to $38,000.

In my view, the Disability DAC failed to take into account several important factors in assessing whether Mr. Mack suffered from a complete inability to engage in any employment for which he is reasonably suited by education, training or experience. It did not sufficiently consider whether Mr. Mack was physically able to perform the types of occupations it listed, whether such work required training, whether it was available in the Kingston area or whether it offered appropriate remuneration.

For these reasons, I find that the Disability DAC is flawed and I give it little weight.

Mitigation

The Insurer submitted that Mr. Mack did not conduct his job search "with sufficient enthusiasm." I disagree. He started looking for work immediately after benefits were terminated. I find that he made an appropriate search given his physical limitations and the limited opportunities in his geographical area.

The assessor at Providence acknowledges that Mr. Mack would be capable of performing the positions outlined in the TSA. As noted above, the Providence report was done on Mr. Mack's own referral. The assessor also points out that these positions would not match his pre-accident earnings, and suggests several retraining options. Kingsway alleges that no concrete steps were taken to follow up with these retraining options. However, Mr. Mack pointed out that he could not afford to pay for this retraining. In addition, he stated that he needed to support his family and, therefore, could not afford the time off work that this sort of retraining required. Further, most of the retraining options required him to live away from his home in Kingston for all or part of the retraining period. This would add to his expenses. I did not hear any evidence indicating that Kingsway had offered to pay for any of these expenses. Kingsway raised the issue that Mr. Mack had not investigated that possibility of obtaining funding assistance to further his education. I find it inappropriate to insist that an insured be obligated to go into debt to fund retraining. I accept Mr. Mack's reasons for not following up with retraining as being valid. Accordingly, I find that he mitigated his damages as best he could by finding jobs that he could perform without significant retraining.

Conclusion regarding an income replacement benefit after 104 weeks of disability

To receive an income replacement benefit for any period longer than 104 weeks of disability, Mr. Mack must prove on a balance of probabilities that he suffers a complete inability to engage in any employment for which he is reasonably suited by education, training or experience.

The phrase "complete inability" has been interpreted in Lombardi and State Farm Mutual Automobile Insurance Company.¹ In this case, Arbitrator Sampliner states as follows:

I find that "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.

Arbitrator Palmer also considered the phrase "complete inability" in the case of Terry and Wawanesa Mutual Insurance Company.² In it she states as follows:

It is not my sense of the test of paragraph 5(2)(b) that the meaning of "complete inability" is that the applicant has to suffer an inability to do more than 50 percent of the job,...Real world jobs should not be broken down into their component parts such that if an applicant is able to do a little more than half of any suitable job, that he should be found to be disentitled from receiving income replacement benefits (and an employer should be obliged to hire him for that job.) As Arbitrator Sampliner pointed out in Lombardi, a literal reading of total disability clauses has been rejected in many previous cases and a literal reading of "complete inability" would mean an insured would have to be unable to perform any function of any job to qualify.

Somehow the ability to engage in a reasonably suitable job, considered as a whole, including reasonable hours and productivity must be addressed. In my view, Mr. Terry has convincingly demonstrated in his attempt at a work trial that he is completely unable to engage in a sedentary job for which I find he was reasonably suited. He would be unable to consistently attend and sustain a reasonable number of hours of employment as a taxi dispatcher or any similar job.

As I stated in Horne and CIBC Insurance,³ and in Sivananthan and State Farm Mutual Automobile Insurance Company,⁴ I concur with the views of Arbitrators Sampliner⁵ and Palmer on this area of the law.

In Wigle and Royal, Arbitrator Seife stated that:

If the job is substantially different in nature, status, or remuneration it may not be an appropriate alternative ... one must consider such factors as ... the hours of work and level of remuneration ...⁶

In its submissions, Kingsway referred to the case of Smillie and State Farm⁷ where the applicant did not like the jobs suggested by the disability DAC. Arbitrator Evans ruled that the applicant could not reject an occupation on that basis, absent some psychological harm posed by it. However, I find this case is distinguishable on its facts. Mr. Mack never stated that he did not like the jobs that were suggested. Rather, he submitted that they were inappropriate due to his physical limitations, need for retraining or insufficient remuneration.

Kingsway's position is that given Mr. Mack's significant skill set, there are a number of occupations for which he is reasonably suited. In addition, Mr. Mack's ability to work for the past two and one-half years proves that he does not suffer from a complete inability to engage in employment for which he is reasonably suited. I disagree. Although there is probably little difference from a prestige or job satisfaction point of view with Mr. Mack's pre-accident employment as a porter and post-accident employment as a school bus and water truck driver, there is a substantial difference in remuneration. Kingsway suggested that Mr. Mack could do the water delivery job year round. However, Mr. Mack's evidence that this work was only available in the summer is credible, and I find it to be so.

I realize that Mr. Mack may, at the time of the accident, have been on the verge of obtaining higher paying employment as a heavy equipment operator. However, since he had not done so to any significant degree, I do not base my decision on this possibility, but rather on his actual employment at the time of the accident. In my view, the occupations suggested by the TSA and the Disability DAC were inappropriate for Mr. Mack for a number of reasons. They were physically unsuitable, required as a prerequisite extensive retraining, had significantly lower remuneration or were not shown to be available in the Kingston area. In addition, I gave the Providence report considerable weight and, based on the same concerns that I expressed, it reached the same conclusion that I did. Under all these circumstances, I find that Mr. Mack, as a result of the accident, is suffering from a complete inability to engage in any employment for which he is reasonably suited by education, training or experience.

Accordingly, I find that Mr. Mack is entitled to an income replacement benefit at a weekly rate not to exceed $400 per week from September 6, 2003 to present and ongoing, less his post-accident income, along with interest as prescribed.

EXPENSES:

If the parties cannot agree on the entitlement to or the amount of the expenses of this proceeding, they may request a date for a hearing on this issue by writing to the Commission within 30 days of the date of this order, in accordance with Rule 79 of the Dispute Resolution Practice Code (Fourth Edition - updated October 2003).

March 28, 2007

Anne L. Sone Arbitrator

Date

Financial Services Commission of Ontario