Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2007 ONFSCDRS 64

FSCO A05-002277

BETWEEN:

CINDY BRODHECKER

Applicant

and

COSECO INSURANCE CO./HB GROUP/DIRECT PROTECT

Insurer

REASONS FOR DECISION

Before:

Denise Ashby

Heard:

September 25, September 26 and September 27, 2006, at the offices of the Financial Services Commission of Ontario in Toronto.

Written submissions were concluded on November 20, 2006.

Appearances:

Raymond Watt for Ms. Brodhecker

Pradeep B. Pachai for Coseco Insurance Co./HB Group/Direct Protect

Issues:

The Applicant, Cindy Brodhecker, was injured in a motor vehicle accident on May 20, 2003. She applied for and received a weekly caregiver benefit from Coseco Insurance Co./HB Group/Direct Protect ("Coseco"), pursuant to the Schedule¹. The benefit was subsequently terminated. The parties were unable to resolve their disputes through mediation, and Ms Brodhecker 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 Ms Brodhecker entitled to receive a weekly caregiver benefit ongoing from May 20, 2005, pursuant to subsection 13(4) of the Schedule?
What is the amount of the weekly caregiver benefit to which Ms Brodhecker is entitled ongoing from December 1, 2003, pursuant to section 13 of the Schedule?
Is Coseco liable to pay Ms Brodhecker's expenses in respect of the arbitration under subsection 282(11) of the Insurance Act, R.S.O. 1990, c. I.8?
Is Ms Brodhecker liable to pay Coseco's expenses in respect of the arbitration under subsection 282(11) of the Insurance Act, R.S.O. 1990, c. I.8?
Is Ms Brodhecker entitled to interest for the overdue payment of benefits pursuant to subsection 46(2) of the Schedule?
Is Ms Brodhecker entitled to initiate a claim for a Special Award pursuant to subsection 282(10) of the Insurance Act, R.S.O. 1990, c.1.8, during the arbitration hearing?
If the answer to question 6 is yes, is Ms Brodhecker entitled to a Special Award and if so, what is the amount pursuant to subsection 282(10) of the Insurance Act, R.S.O. 1990, c.1.8?

Result:

Ms Brodhecker is entitled to receive a weekly caregiver benefit, ongoing from May 20, 2005, pursuant to subsection 13(4) of the Schedule.
Ms Brodhecker is entitled to receive a weekly caregiver benefit at the rate of $350.00, less amounts previously paid by Coseco, ongoing from December 1, 2003, pursuant to section 13 of the Schedule.
Coseco is liable to pay Ms Brodhecker's expenses in respect of the arbitration under subsection 282(11) of the Insurance Act, R.S.O. 1990, c. I.8.
Ms Brodhecker is not liable to pay Coseco's expenses in respect of the arbitration under subsection 282(11) of the Insurance Act, R.S.O. 1990, c. I.8.
Ms Brodhecker is entitled to interest for the overdue payment of benefits commencing May 25, 2005, pursuant to subsection 46(2) of the Schedule.
Ms Brodhecker is entitled to initiate a claim for a Special Award pursuant to subsection 282(10) of the Insurance Act, R.S.O. 1990, c.1.8 during the arbitration hearing.
Ms Brodhecker is not entitled to a Special Award, pursuant to subsection 282(10) of the Insurance Act, R.S.O. 1990, c.1.8.

EVIDENCE AND ANALYSIS:

On May 20, 2003, Ms Brodhecker was injured in a motor vehicle accident. She was taken by ambulance to hospital where she was examined and released. She claims entitlement to caregiver benefits and a reassessment of the quantum of those benefits pursuant to Section 13 of the Schedule.

The parties agree that for the 104-week period following the accident, Ms Brodhecker was substantially disabled from providing caregiving to her three children who were, at the time of the accident, aged 11, 5 and 4.

Coseco disputes that Ms Brodhecker is entitled to an additional payment of $4,800.00 for that period. It also disputes that Ms Brodhecker suffered or is suffering a complete inability to carry on a normal life. Further, it disputes that there is any amount owing for the period from May 20, 2003 to May 19, 2005, on the basis that it has paid all caregiving expenses claimed for the period. Coseco submits that any reassessment for pre-104 week benefits would be prejudicial to its interests.

Entitlement to Post-104 Week Caregiver Benefits:

At the time of the accident, Ms Brodhecker, her husband, Stephen Brodhecker, her two daughters and the couple's son lived together in a 1,500 sq. ft. two-storey home in Peterborough.

Ms Brodhecker cared for the children and the home while Mr. Brodhecker earned substantially all the family income. Ms Brodhecker claims that since the accident she has been unable to resume substantially all of her pre-accident activities and is therefore entitled to post-104 week caregiver benefits.

Ms Brodhecker, Stephen Brodhecker, and Ms Brodhecker's mother, Patricia Woolcott, testified at the arbitration hearing. Their evidence, taken together, was consistent and compelling. They each testified that prior to the accident Ms Brodhecker was responsible for the household, caring for her three children, including all care relating to her autistic daughter. She earned additional income offering respite foster care to special needs children. Also, Ms Brodhecker was active in her church, providing interpreter services for the deaf. Despite a history of back pain she engaged in vigorous physical activity, as evidenced by her taking kick-boxing classes. Ms Brodhecker was socially active, frequently entertaining in her home. She used her social skills to organize house parties in other people's homes at which she sold candles.

All three witnesses testified that accident related pain and depression prevent Ms Brodhecker from meaningfully caring for her children; providing respite care; engaging in social activities, including church attendance and participating in vigorous exercise. As well, she was prevented from entering a Community College nursing program in September 2003. They described her child care activities as restricted to preparing simple meals, if the ingredients are organized for her, folding light laundry, while seated, and observing her children's activities.

Ms Brodhecker testified that she is in constant pain for which she takes large doses of pain medication. She testified that sometimes the pain is so extreme she cannot shower because the water feels like needles. Her mobility restrictions prevent her from taking baths.

Ms Brodhecker, Mr. Brodhecker and Ms Woolcott all testified that each of Ms Brodhecker's children has special needs. Her middle child is diagnosed as being autistic. Although this child attends school on a full time basis, she requires special assistance. She is subject to violent emotional outbursts which may require physical restraint. Consequently, this daughter requires close supervision. The eldest child has attempted suicide twice since the accident. She continues to be emotionally fragile. Therefore, she requires greater supervision than might be expected of a teenage girl. They described her son, the youngest child, as emotionally needy.

Ms Brodhecker and her husband testified that Ms Brodhecker has gone on family vacations to both Florida and South Carolina since the accident. Mr. Brodhecker's family takes an annual vacation in South Carolina. The couple do not take their children on these trips. In 2004, the couple drove. Ms Brodhecker experienced anxiety, pain and discomfort such that the following year she flew to South Carolina with her brother-in-law. Notwithstanding her experience with driving, Ms Brodhecker travelled to Florida with her husband, the two youngest children and a friend in September 2005. This trip was undertaken because the children wanted a vacation similar to their parents' yearly trip to South Carolina. Mr. Brodhecker described this trip as very difficult. He testified that Ms Brodhecker took the maximum daily dose of Percocet for pain on the drive and minimally participated in family activities while in Florida. Occasionally, she would sit on the beach and observe the children playing. This was her last car trip. In 2006, she flew to South Carolina and is planning to do so again in May 2007.

Ms Brodhecker and her husband testified that due to Ms Brodhecker's post-accident condition, Mr. Brodhecker's professional commitments and the children's special needs, two neighbours were hired, successively, to provide housekeeping and caregiving. These arrangements failed to meet the needs of the family. As a consequence, on December 1, 2003, Ms Woolcott assumed the duties of housekeeper and caregiver. The couple hoped that Ms Woolcott's relationship with her grandchildren together with her experience providing care to special needs foster children might better meet their family's needs.

Ms Woolcott did not live in Peterborough when she agreed to assume her new duties. To facilitate the change, she and her husband sold their home and moved into the basement of the Brodhecker home. This move necessitated their ceasing to care for three of the four special needs foster children who were living with them at the time. The fourth foster child moved with the Woolcotts to the Brodhecker home. Ms Woolcott testified that this change significantly reduced her family's income. She could see no other alternative given her daughter's post-accident physical and mental condition.

In the summer of 2004, Mr. Brodhecker was promoted to bank manager. This promotion required a move to another city. Both families moved there together. The Woolcott family continues to reside in the Brodhecker home. The witnesses testified that this arrangement continues to be necessitated by Ms Brodhecker's disability and the caregiving needs of the three children.

Ms Brodhecker has been diagnosed as suffering from a severe chronic pain disorder by her treating physician, Dr. S. Lesser. This diagnosis has been confirmed by Dr. F. Leung, a rheumatologist, and Dr. Angela Mailis-Gagnon, director of the Comprehensive Pain Program at Toronto Western Hospital, who also found that Ms Brodhecker suffered from a major depression pursuant to the DSM IV.² Dr. Donald Young, a psychologist, who conducted an assessment on behalf of Coseco on April 13, 2005, was also of the opinion that Ms Brodhecker fulfilled the diagnostic criteria of pain disorder associated with both psychological and a general medical condition. Both Dr. Mailis-Gagnon and Dr. Young were of the opinion that although Ms Brodhecker exhibits features of post-traumatic stress disorder she does not fully meet the criteria for that diagnosis.³

Dr. Weinberg, an orthopaedic surgeon, assessed Ms Brodhecker on behalf of Coseco. He found no objective evidence of musculoskeletal pathology that would explain the pain described by Ms Brodhecker.⁴ Dr. Weinberg did not refer to either the diagnosis of chronic pain disorder or depression. Although, he found inconsistencies and signs "suggestive" of symptom magnification he did not conclude that she was not credible. Ms Brodhecker's assessing and treating medical professionals substantially agree with Dr. Weinberg's opinion respecting musculoskeletal pathology. However, the lack of such pathology did not alter their opinion that Ms Brodhecker met the diagnostic criteria for chronic pain disorder.

Ms Alison Poole, an occupational therapist, testified on behalf of Ms Brodhecker. Ms Poole conducted an insurer's in-home assessment on June 14, 2006. Notwithstanding the assessment was conducted in the late afternoon, Ms Brodhecker was dressed in her pyjamas. Ms Woolcott was present during the assessment and supervised the children. Ms Poole testified that she believed Ms Brodhecker's description of her daily life. She accepted that Ms Brodhecker did very little around the home, spending most of her waking hours sitting propped up with pillows on the couch. Ms Poole accepted that Ms Brodhecker made reasonable efforts during the assessment. She attributed any inconsistencies in test results to fatigue, pain or fear of pain. In her report dated June 23, 2006, Ms Poole stated:

...Due to the client's current diagnoses as noted in the summary and resulting limitations, the client is not physically or emotionally able to provide the required level of care her daughter needs. To ensure the safety of the client's daughter as well as the client considering her diagnoses, constant caregiving assistance is recommended for the 8 year old daughter during waking hours... The client's mother is currently providing this level of caregiving assistance...⁵

Ms Poole concluded that 94 hours per week of caregiving was required for the autistic daughter during which the caregiving needs of the other two children could be met.

Subsection 13(4) of the Schedule provides that an insurer is not required to pay a caregiver benefit beyond 104 weeks unless the insured person's accident related disability results in "a complete inability to carry on a normal life." Subsection 2(4) states:

For the purpose of this Regulation, a person suffers a complete inability to carry on a normal life as a result of an accident if, and only if, as a result of the accident, the person sustains an impairment that continuously prevents the person from engaging in substantially all of the activities in which the person ordinarily engaged before the accident.

In Maria Da Ponte and Motor Vehicle Accident Claims Fund, the arbitrator provides the following analysis of arbitral case law which considered the "complete inability test":

The case law establishes that the phrase "engaging in" means more than isolated post-accident attempts to perform the activities that an applicant was able to perform prior to the accident. The manner in which an activity is performed, or the quality of the performance, must also be considered. If the degree to which an individual can perform an activity is sufficiently restricted, it cannot be said that they are truly "engaging in" the activity. The activity must be viewed as a whole and should not be broken down into its constituent parts. An applicant who is merely "going through the motions" cannot be said to be "engaging in" activity.

In cases where pain is the primary factor that allegedly prevents the insured from engaging in his or her former activities, the question is not whether the insured can physically do these activities, but whether the degree of pain experienced, either at the time, or subsequently, is such that the individual is practically prevented from engaging in those activities.⁶

The preponderance of the medical and psychological evidence leads to the conclusion that Ms Brodhecker suffers from a disabling chronic pain disorder and major depression. Therefore, I find that but for the motor vehicle accident of May 20, 2003 Ms Brodhecker would not be suffering from her disabling depression and chronic pain disorder.

The decision in Maria Da Ponte and Motor Vehicle Accident Claims reflects the reality that engaging in the activities of life is greater than being able to accomplish some of the individual components of those activities. Prior to the accident, Ms Brodhecker had many facets to her life. She was a caring mother of three needy children. A wife and partner who earned income. She was physically active. She was a participating member of her community. The testimony of Ms Brodhecker, her husband and her mother was a compelling description of a woman who is continuously prevented by virtue of her disabling chronic pain disorder and depression from engaging in those activities. Filling the vacuum left by Ms Brodhecker's incapacity is the only reasonable explanation for the Woolcott family disrupting its life to facilitate Ms Woolcott assuming the care of her three grandchildren.

The extent to which Ms Brodhecker participates in any of her activities of daily life is minimal. She has travelled since the accident. Those vacations were little more than replicating her extremely restricted life in another setting. Sitting in a car or air plane while heavily medicated rather than on the couch in her home. Sitting on a beach observing her children rather than observing their activities from her couch. I find that, while Ms Brodhecker is physically able to do some of her pre-accident activities, she is continuously prevented from engaging in them due to the degree of pain she experiences both during and following those activities, compounded by the sequela of her major depression.

Quantum of Caregiver Expenses:

Ms Brodhecker disputes the quantum of benefits paid to her. In September 2006, she submitted a claim for $4,800.00 for caregiving provided by Ms Woolcott from December 1, 2003 to May 19, 2005. This amount was in addition to the amounts previously paid by Coseco. The issue in dispute between Ms Brodhecker and Coseco is the amount of the caregiver benefit to be paid. Subsection 282(3) of the Insurance Act, R.S.O. 1990, c. I.8, provides that: "The arbitrator shall determine all issues in dispute, whether the issues are raised by the insured person or the insurer."

Subsections 13(2) and (3) of the Schedule provide for the payment of the reasonable and necessary caregiving expenses incurred as a result of the accident. The amount of the claim shall not exceed $250.00 weekly for the first person and $50.00 weekly for each additional person. Therefore, the statutory maximum weekly caregiver benefit available to Ms Brodhecker is $350.00. The invoices submitted by her are not determinative of the reasonably necessary caregiving expenses which have been incurred. That, in the absence of agreement between the parties, is for an arbitrator to decide following consideration of the evidence.

In her receipt dated September 17, 2006, Ms Woolcott indicates that her previous invoices dealt only with her care of the autistic child. She further states:

During the period between December 1, 2003 and May 16, 2005 I can advise that I provided care to all three children. Daniel did not start school full time until September 2005 and I provided care to him during the day. I assisted with getting the children up in the morning, dressed, fed and off to school, as well as after school care including making their meals, assisting with homework, taking them to the park, getting them ready for bed and into bed, taking them on outings etc.⁷

Ms Brodhecker and Ms Woolcott testified that the only compensation for the services Ms Woolcott has provided since December 1, 2003 is living with her family rent free in the basement of Ms Brodhecker's home. Ms Brodhecker testified that her fear of Coseco's termination of the benefit influenced her valuation of Ms Woolcott's services.

There were two in-home assessments conducted by Coseco's assessors. Ms Nicole Dwyer, an occupational therapist, did the first on July 21, 2004. She assessed Ms Brodhecker's reasonably necessary caregiving requirements at 45 hours per week for two children.⁸ The second, was conducted by Ms Poole who recommended 94 hours weekly. She was of the opinion that the care of the other two children could be dealt with within the time she attributed to the autistic daughter.⁹

I prefer Ms Poole's findings and her oral evidence to that of Ms Dwyer. I do not accept Ms Dwyer's conclusion that a 12-year old child does not require caregiving. Ms Poole's report and testimony provided a more comprehensive analysis of Ms Brodhecker's activities. Therefore, I find that Ms Brodhecker requires caregiving services for 94 hours weekly to care for her three children. Further, I find that at no time since the accident has Ms Brodhecker required less than the 45 hours per week assessed by Ms Dwyer.

Ms Woolcott is an exceptional mother and grandmother. She has foregone her own home and the privacy that affords to care for her three grandchildren. She has assumed a reduction in her income. Ms Woolcott brought specialized, compensable, skills to her role as caregiver gained through years of providing foster care. In the circumstances of this matter, her status as the children's grandmother was also an important element in being a successful caregiver to the children. An hourly rate of $20.00 would not be unreasonable. However, given the number of hours required it is not necessary for me to determine an hourly rate beyond that of an unskilled caregiver of $10.00 per hour. This hourly rate when multiplied by the minimum weekly caregiving requirements results in an amount of $450.00 weekly, only $350.00 of which is compensable pursuant to the Schedule.

Coseco submitted that allowing a claim for any additional amount would be prejudicial to its interests. I do not agree. Coseco has had the benefit of its assessors' reports. Both of the occupational therapists assessed a need for caregiving services which, at an unskilled hourly rate, exceeded the maximum allowable for the three children. Neither should Ms Woolcott be prejudiced nor Coseco benefit from Ms Brodhecker's undervaluation of her mother's services out of fear that the benefit would be terminated.

Therefore on the basis of the foregoing, I find that Ms Brodhecker incurred caregiving expenses of $350.00 weekly, less amounts paid by Coseco, ongoing from December 1, 2003, pursuant to section 13 of the Schedule.

INTEREST:

I find that Ms Brodhecker is entitled to interest on all overdue caregiving benefits commencing May 25, 2005, pursuant to subsection 46(2) of the Schedule.

SPECIAL AWARD:

During final submissions, Ms Brodhecker sought to claim a special award pursuant to subsection 282(10) of the Insurance Act, R.S.O. 1990, c. 1.8. She submitted that the issue of a special award is always before the arbitrator should an arbitrator be of the opinion that the insurer unreasonably withheld or delayed payment of a benefit. Coseco submitted that permitting the issue to be added after the evidence had been concluded would be fundamentally unjust.

I adjourned the hearing to permit written submissions. I suggested that were I to find that the issue of a special award could be raised late in the proceedings I would be prepared to reopen the hearing to deal with the matter.

Subsection 282(10) provides:

If the arbitrator finds that an insurer has unreasonably withheld or delayed payments, the arbitrator, in addition to awarding the benefits and interest to which an insured person is entitled under the Statutory Accident Benefits Schedule, shall award a sum of up to 50 per cent of the amount of which the person was entitled at the time of the award together with interest on all amounts then owing to the insured (including unpaid interest) at the rate of 2 per cent per month, compounded monthly, from the time the benefits first became payable under the Schedule.

Having found that Ms Brodhecker is entitled to caregiving benefits pursuant to section 13 of the Schedule ongoing from December 1, 2003, the issue of a special award is within my discretion to award. This discretion is unfettered save for the rules of natural justice and fairness.¹⁰

Coseco submitted that the Insurer's medical reports provided a reasonable basis for termination of the benefits. Further, no evidence has been produced which would provide a basis for awarding a special award. Coseco, the party potentially prejudiced by the lack of notice, did not request that Ms Brodhecker be required to provide further particulars of her claim or that it be given an opportunity to bring evidence in defence. Therefore, I find that it is not necessary for me to reopen the hearing to cure the defect of inadequate notice.

In Maria Da Ponte and Motor Vehicle Accident Claims Fund, the arbitrator articulated the test for unreasonable delay as follows:

While a special award may be a sanction for inappropriate conduct by an insurer, it is not contingent upon finding bad faith, or the commission of an actionable wrong by the insurer. All that is required is an unreasonable withholding of payments that are due to the insured. As noted by Arbitrator Palmer Plowright and Wellington Insurance Company (OIC A-003985, October 29, 1993):

"Unreasonable behaviour by an Insurer in withholding or delaying payments can be seen as behaviour which was excessive, impudent, stubborn, inflexible, unyielding or immoderate."

All of these definitions express the common sense of going beyond the limits of what is reasonable or a failure to be guided by reason. An unreasonable action is neither fair nor moderate, nor arising out of sound judgement.¹¹

This arbitration is an example of a case which required a hearing. The reports available to Coseco in May 2005 did not capture the extent to which Ms Brodhecker's depression and chronic pain disorder restricted her participation in her activities of daily life. I, unlike Coseco's adjuster, had the advantage of hearing the testimony of Ms Brodhecker, her husband and her mother. It was the their oral evidence that illuminated the impact of the disability on Ms Brodhecker's daily life. Consequently, I find that Coseco's termination of the caregiver benefit after104-weeks was not unreasonable. Therefore, I deny Ms Brodhecker's claim for a special award.

EXPENSES:

The parties made no submissions with respect to expenses. I encourage them to resolve the issue on their own, failing which they may request an expense hearing before me in accordance with the Dispute Resolution Practice Code.

March 30, 2007

Denise Ashby Arbitrator

Date