Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2010 ONFSCDRS 144

Appeal P08-00039

OFFICE OF THE DIRECTOR OF ARBITRATIONS

WAWANESA MUTUAL INSURANCE COMPANY Appellant

and

SOPHIA SUN Respondent

BEFORE: David Evans

REPRESENTATIVES: Seth Kornblum for Wawanesa Mutual Insurance Company Robert N. Franklin for Ms. Sun

HEARING DATE: By written submissions received January 15, 2010

VARIATION/REVOCATION ORDER

Under section 284 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:

Wawanesa Mutual Insurance Company’s application for variation or revocation is dismissed.
If the parties are unable to agree about expenses of this application, an expense hearing may be arranged in accordance with Rule 79 of the Dispute Resolution Practice Code.

December 16, 2010

David Evans Director’s Delegate

Date

REASONS FOR DECISION

I. NATURE OF THE APPEAL

Wawanesa Mutual Insurance Company (Wawanesa) seeks a variation or revocation of an arbitration order granting Ms. Sophia Sun ongoing income replacement benefits (IRBs).

II. BACKGROUND

Ms. Sun was injured in a motor vehicle accident on July 9, 2005 and was thereafter unable to work. Pursuant to the SABS–1996,¹ she applied to Wawanesa for IRBs and received them until October 2005, when Wawanesa terminated them. She sought their reinstatement, along with other statutory accident benefits, through mediation and then arbitration. Since the arbitration hearing was conducted in May 2007, or less than 104 weeks after the accident, the “own occupation” test for IRB eligibility applied: whether or not Ms. Sun, who was employed at the time of the accident, suffered and continued to suffer a substantial inability to perform the essential tasks of that employment.²

At the time of the hearing, Ms. Sun was 36 years old. As she did not speak or read English, an interpreter assisted her at the arbitration hearing. With respect to her employment, the Arbitrator noted:

At the time of the accident, Ms. Sun was working for a company, Tenatronics, which makes cable products for automobiles. Ms. Sun worked on the assembly line where she rotated every two hours between four work stations.

Her job involved, in part, crimping and soldering cables. Ninety-five percent of her job was sitting. She said it was a fast paced job. She stated that the individual cables she worked on were not heavy. However, after finishing working on 250 cables, she had to lift the box they were placed in and carry it approximately 10 feet. The filled box was quite heavy. It weighed approximately 40 to 50 pounds.

The Arbitrator noted that the fact Ms. Sun was collared at the scene of the accident and taken to the hospital by ambulance could be seen as a measure of the seriousness of the impact of the car in the accident. She accepted that Ms. Sun had been in good health prior to the accident. She found that Ms. Sun was credible and that minor misunderstandings in her testimony could be directly attributed to her lack of knowing English and the difficulties inherent in having to provide her testimony through an interpreter.

In a decision dated August 16, 2007, or more than 104 weeks after the accident, the Arbitrator found that Ms. Sun had provided reliable medical evidence consistent with her testimony that as a result of the accident she suffered from a psychological impairment and chronic pain syndrome. Furthermore, the Arbitrator found that “as a result of Ms. Sun’s accident-related injuries, which include her chronic pain, headaches, sleep deprivation, depression, memory and concentration problems, she is disabled from performing the essential tasks of employment as an assembly line worker.” The details of Ms. Sun’s psychological impairment as found by the Arbitrator are set out in more detail below. The Arbitrator also found that benefits were unreasonably withheld and that Ms. Sun was entitled to a special award under s. 282(10) of the Insurance Act. In a subsequent decision dated November 28, 2007, she ordered Wawanesa to pay a near-maximal value of $25,000.³

Wawanesa ordered a number of insurer examinations (IEs) after the hearing, all concluding that Ms. Sun does not meet the stricter “any occupation” test in s. 5(2)(b) of the SABS, which provides that an insurer is not required to pay an IRB “for any period longer than 104 weeks of disability,⁴ unless, as a result of the accident, the insured person is suffering a complete inability to engage in any employment for which he or she is reasonably suited by education, training or experience.”

Despite these IEs, however, Wawanesa cannot use the termination procedures set out in the SABS because s. 287 of the Insurance Act provides that an insurer “shall not, after an order of … an arbitrator appointed by the Director, reduce benefits to an insured person on the basis of an alleged change of circumstances, alleged new evidence or an alleged error, unless the insured person agrees or unless the Director [or his delegate] or an arbitrator so orders in a variation or appeal proceeding” under s. 284 or 283. Thus, where an arbitrator has ordered that an insured person is entitled to ongoing IRBs, an insurer cannot terminate benefits on the basis of new medical information such as an IE without first applying for a variation or appeal of the order: Nelson and Liberty Mutual Insurance Company, (FSCO A00-000253, November 8, 2001), approved in Allstate Insurance Company of Canada and Simpson, (FSCO P01‑00057, June 6, 2003).

This is a variation proceeding under s. 284 of the Insurance Act. Wawanesa is seeking a variation or revocation of the Arbitrator’s August 2007 order because it submits that the any occupation test should be applied from the 104 week point. Pursuant to s. 284(3), I may vary or revoke the order and may make a new order if I consider it advisable to do so if

there has been a material change in the circumstances of the insured, or
that evidence not available on the arbitration or appeal has become available, or
that there is an error in the order.

While Wawanesa relies on the first two grounds, it relies in particular on the first, submitting that the change from the “own occupation” to the “any occupation” test after 104 weeks of disability constituted just such a material change in circumstances. Furthermore, since s. 284(4) provides that an order made, varied or revoked under s. 284(3) may be prospective or retroactive, it is seeking repayment of all benefits paid from the 104 week mark.

III. ANALYSIS

This matter proceeded by way of written submissions and medical opinions they had obtained for me to review.

With respect to the post-104 week “any occupation” test, Wawanesa cited no case law and simply set out its position on the test’s meaning while relying on its assessors’ opinions that Ms. Sun did not meet it. However, it is first necessary to consider what a material change of circumstances means in the context of a variation or revocation hearing. Wawanesa took the view that the change in the eligibility test after 104 weeks of disability constituted a material change of circumstances in and of itself, based on comments in two cases discussed below. Ms. Sun in turn relied on comments in two other cases that a more contextual view is needed in determining whether there has been a material change in circumstances.

As for the process of a variation/revocation hearing, while Wawanesa did cite Pilot Insurance Company and Riley, (FSCO P99-00009V, February 29, 2000), a variation and revocation hearing, it was cited only with respect to the long-standing proposition that pain itself is not compensable under the SABS. Riley is, however, more useful than just for that proposition. It was upheld on appeal in Riley and Pilot Insurance Company, (FSCO P00-00021, June 12, 2002), and the Director’s Delegate discussed the grounds for a variation or revocation. He noted that a claim for variation/‌revocation on the basis of evidence that was not available at the time of the original order is retrospective and represents a challenge to the correctness of the original order. I agree with that position and note that Wawanesa specifically does not attack the original order. Furthermore, it relies entirely on new evidence that was developed after the hearing, namely the various IEs. As the delegate noted in Riley, “the ‘material change in circumstances’ ground is prospective. It does not challenge the correctness of the original order. It is designed to afford the insurer relief in circumstances where the insured’s circumstances have evolved to the point where payment of ongoing benefits can no longer be justified.” Accordingly, I find that the only ground on which Wawanesa can seek a variation or revocation is that of a material change in Ms. Sun’s circumstances or condition.

Riley dealt with a similar but not identical stricter eligibility test for long-term IRBs under the SABS-1990.⁵ In the original arbitration decision dated April 15, 1996, that was subsequently varied, the arbitrator allowed Ms. Riley’s claim and ordered Pilot to pay ongoing benefits under the more stringent post-156 week test set out in that SABS. After paying benefits for about nine years, Pilot applied for a variation/revocation on the grounds that Ms. Riley no longer met the test. The matter was referred back to the arbitrator who made the original decision. With respect to a change in material circumstances in this situation, she set out a two-part test. One: had there been a material change in Ms. Riley’s condition? Two: did that change affect her functional ability to the extent that she was no longer prevented from engaging in suitable employment? The arbitrator found that there had been a material change in circumstances and that Ms. Riley was no longer prevented from working.

I agree with this two-part test. Adapted to this case, the first issue is whether or not, as Wawanesa alleges, the change in the test alone constitutes a material change in Ms. Sun’s circumstances. Wawanesa relies on Ramalingam 2004,⁶ in which the arbitrator found that “a change in the disability test an insured person must meet after the 104-week period is a material change in Mr. Ramalingam’s circumstances, because he is required to satisfy a more onerous test in order to establish entitlement to income replacement benefits and housekeeping benefits at that juncture…” In a related appeal, Ramalingam 2007,⁷ the Director’s Delegate stated that she agreed with this reasoning. Thus, Wawanesa submits, there does not have to be a change in Ms. Sun’s pre-104 week circumstances for her to be disentitled to post-104 week IRBs.

By way of contrast, Ms. Sun relies on statements by Arbitrator Feldman in Hutchinson and Security National Insurance Co./Monnex Insurance Mgmt. Inc., (FSCO A03-001712, May 25, 2007), and Nadarajah and TD General Insurance Company, (FSCO A07-002490, September 25, 2008). He held that a change in the test for entitlement to a benefit may constitute a material change in the circumstances of the insured person, but that this depends upon all of the circumstances of the insured person and that a change in the test does not automatically constitute a material change in every case. In Hutchinson, he gave the example of a comatose person who would clearly meet both tests, so a change in the test would be irrelevant, and he stated that “[r]arely will it be sufficient or appropriate to consider a change in the test for entitlement in isolation from, and without consideration of, the other circumstances of the insured person.”

I am inclined to agree with this viewpoint, especially in light of the circumstances in which the Ramalingam decisions were issued, as neither dealt with the effect of s. 287 (protection of benefits) on a final order where the test changes after the period dealt with in the order. Ramalingam 2004 was in part a variation hearing of the arbitrator’s previous decision awarding interim benefits based on the pre-104 week own occupation test. These had been granted on a prima facie basis: the insured person produced evidence that, if unanswered and believed, was sufficient to render reasonable a conclusion in favour of entitlement. The matter was also supposed to be heard soon after the order, but the hearing was delayed. The insurer started a variation application to terminate the interim benefits – and Mr. Ramalingam brought a counter-motion to continue them – after the 104‑week mark. In her variation decision, the arbitrator first applied the third ground for a variation application, namely an error in the order, by clarifying that under the original order State Farm was only obliged to pay interim benefits to the 104-week mark because only the own occupation test had been applied. Only then did she make the finding alluded to above, that “a change in the disability test an insured person must meet after the 104-week period is a material change in Mr. Ramalingam’s circumstances,” going on to find that the applicant’s condition had actually worsened, entitling him to interim IRBs based on the any occupation test. In doing so, she reproduced medical opinions provided on Mr. Ramalingam’s initial motion for interim benefits, which provided context for the more recent opinions.

Thus, Mr. Ramalingam had been granted interim benefits on the prima facie test that sets a lower threshold for the granting of benefits than at a full hearing on the merits. It is logical that the change in the test would be seen as the major if not the only factor creating a material change in circumstances. As was stated in Sellathamby and Allstate Insurance Company of Canada, (FSCO P02-00009, December 17, 2002), at pp. 20-21,

interim benefits are interlocutory in nature. Interim orders for the payment of benefits are intended to protect the flow of benefits to an insured person where there is reason to believe he will ultimately succeed in proving entitlement… Interim benefits are not intended to be indefinite in duration. They are made “pending the final order.” They are subject to the arbitrator’s final order, and repayable if the insured person is ultimately found not to be liable.

Furthermore, the arbitrator in Ramalingam 2004 did not just consider the new medical reports but considered them in the context of the existing reports. This is consistent with Riley, in which to provide context the arbitrator considered not just the new evidence provided by the insurer but also the previous evidence.

As for Ramalingam 2007, the appeal case, s. 287 of the Insurance Act was not even directly at issue. While the delegate agreed with the arbitrator’s reasoning in Ramalingam 2004 when the arbitrator clarified her order, the issue in Ramalingam 2007 was whether or not the insurer could obtain additional IEs after the change to the any occupation test. The delegate noted that “the change in the test requires an insurer to reassess a claim for ongoing benefits, and all else being equal, a fresh IE may be reasonable to allow the insurer to determine entitlement to ongoing benefits”, but “the arbitrator must consider all the relevant circumstances, not just the change in the test, to determine the reasonableness of the IE request.” In fact, the delegate upheld the arbitration decision denying a further IE on the basis of the other circumstances around the request.

Thus, neither of these decisions supports the proposition that the change in the test alone suffices to constitute a material change in circumstances where benefits have been finally ordered after a full hearing on the merits. I note that at the end of the Ramalingam 2007 decision, in footnote 34, the delegate wrote that “[h]ow section 287 of the Insurance Act (protection of benefits) applies to an interim benefits order in these circumstances is not entirely clear.” This case deals with a final order of benefits, so s. 287 definitely applies. Furthermore, if an insurer cannot seek an IE simply because of the change in the test, it follows that the adjudicator in a hearing to vary or revoke benefits to which s. 287 applies must consider all the relevant circumstances, not just the change in the test, to determine whether or not there has been a material change in circumstances.

To reiterate, s. 287 affords a mandatory protection of benefits. Its significance was reaffirmed in the Simpson appeal referred to above. In that case, an arbitrator had issued an order for ongoing benefits despite not having made any findings regarding entitlement. The delegate found this was an error of law, stating:

The effect of s. 287 is clear: it protects an insured person’s benefits after an order of the Director or an arbitrator. Contrary to the Arbitrator’s reasons, this marks a significant change in the parties’ relationship. Without the order, Allstate could terminate Ms. Simpson’s benefits by following the procedure set out in the SABS-1996. The Arbitrator’s order prevented it from doing so without obtaining a further order or the insured person’s consent.

Turning to the condition of Ms. Sun at the time of the arbitration hearing, as noted above, the accident happened on July 9, 2005, and about two years later the Arbitrator found Ms. Sun entitled to IRBs principally because of her psychological problems, which I will now set out.

On October 19, 2005, Ms. Sun applied to Wawanesa for approval for a psychological assessment by Dr. M. Perlmutter. This OCF-22 was denied, and Wawanesa sent the application to an evaluating psychologist, Dr. E. MacNiven, who rejected the OCF-22. However, notwithstanding the rejection, Ms. Sun underwent the assessment with Dr. Perlmutter, and the Arbitrator considered his report dated December 14, 2005. Dr. Perlmutter concluded that the accident caused Ms. Sun’s emotional distress and led to ongoing pain difficulties, which resulted in impaired functioning with regards to her day-to-day activities. In his treatment plan, OCF-18, Dr. Perlmutter identified a number of disorders, including Adjustment Disorder-Mixed Anxiety and Depressive Reaction, passenger anxiety, acute pain, sleep problems, irritability and anger, problems related to employment, and post-traumatic stress disorder. He recommended 14 hours of psychotherapy to assist Ms. Sun in managing her psychological distress.

The treatment plan was denied, and it was sent to a DAC to be evaluated. The DAC report on March 27, 2006 concluded that the treatment plan was “reasonable and necessary.” In his conclusions Dr. Leonard Goldsmith stated he was essentially in agreement with Dr. Perlmutter’s diagnoses and with his recommendations for treatment.

However, there was a failure to communicate between Wawanesa and Ms. Sun’s representative, and in fact in June 2006 Wawanesa advised that the DAC had found Dr. Perlmutter’s treatment plan not to be reasonable or necessary.

On March 5, 2007, Dr. Alex Alexander, who became Ms. Sun’s regular family doctor after the accident, provided an OCF-3 Disability Certificate wherein he stated that as a result of her car accident, Ms. Sun was substantially unable to perform the essential tasks of her employment. Wawanesa sent Ms. Sun for an IE with Dr. Paul Robinson, a psychologist. Ms. Sun saw Dr. Robinson on April 17, 2007 and completed the necessary testing by May 3, 2007. In his conclusion, Dr. Robinson found that he was able to make a valid measurement of Ms. Sun’s psychological functioning. With respect to employability, he found that genuine psychological/‌emotional factors were of primary importance in understanding her indicated extensive impairment in functioning: “Disruptive symptomatology at least includes poor sleep, fatigue, decreased energy, low mood, vulnerability to cognitive confusion, limited/ineffective stress management strategies, low stress tolerance, low mood, and anxious symptomatology.” He concluded that “[s]peaking strictly from a psychological perspective,” Ms. Sun was unable to perform her pre-accident job as a result of the accident.

The Arbitrator also noted that Dr. Langer, an orthopaedic surgeon, on January 17, 2006, diagnosed Ms. Sun as suffering from chronic pain syndrome and that “Ms. Sun does have a substantial impairment for returning to her vocation or any job at this point of time.”

It was on this basis that the Arbitrator found that Ms. Sun suffered from a psychological impairment and chronic pain syndrome. As noted above, the Arbitrator found that Ms. Sun’s accident-related injuries, which included her chronic pain, headaches, sleep deprivation, depression, memory and concentration problems, prevented her from returning to work. This was a point she repeated in the November 2007 decision determining the amount of the special award:

I am convinced from the evidence at the hearing that if Wawanesa had adjusted the file in a good faith manner, providing Ms. Sun with the early proper support that she required, rather than looking to thwart her in every way it could, that it is more likely than not that two years after the accident Ms. Sun would not be in such a deteriorated situation that she cannot return to work.

Accordingly, by July 2007 Ms. Sun had been found by a DAC to be entitled to psychotherapy and by an IE that she was unable to do her pre-accident job for psychological reasons. Nonetheless, Wawanesa submits that Ms. Sun is not entitled to further IRBs from July 2007 onwards because s. 287 by itself represents a change in circumstances and Ms. Sun otherwise does not meet the any occupation test. However, with respect to the Multi-Disciplinary Assessment Report prepared by Riverfront Medical Services dated April 2, 2008, on which Wawanesa relies, I agree with the submission of Ms. Sun that those assessors “failed to document any change in the circumstances of Ms. Sun, let alone one that may be material.” In fact, the assessors largely ignored the findings of the Arbitrator and proceeded as if this was not a case limited by the protection of benefits guaranteed in s. 287.

For instance, Mr. Luigi Grimaldi, kinesiologist, conducted a functional capacity evaluation. Wawanesa summarizes this FCE, which concluded as did all the other assessments at Riverfront that Ms. Sun does not meet the any occupation test, as follows:

During testing, Ms. Sun demonstrated good push/pull technique and sat throughout the 40 minute assessment. Despite same, the FCE concluded that Ms. Sun provided sub-maximal effort.

Although Mr. Grimaldi opined that Ms. Sun was pain-focused and that the FCE was not an accurate reflection of Ms. Sun’s functional abilities because of self-limitation, based upon her demonstrated abilities while sitting, the FCE concluded that Ms. Sun demonstrated sufficient mobility, strength and tolerances to perform a sedentary occupation.

However, under the heading Current Functional Status, Mr. Grimaldi refers to an In-Home Occupational Therapy Functional Assessment dated January 3, 2006 from Elizabeth McLean, O.T., which she conducted for a housekeeping assistance claim. Mr. Grimaldi repeats Ms. McLean’s assertion that “Ms. Sun’s marked self-limiting performance does not allow any confident conclusions with respect to identifying functional impairments that would solely be attributed to the subject accident” and that housekeeping assistance was not endorsed. I note that, aside from Ms. McLean misstating the causation test, in that impairments do not solely have to be attributed to an accident to be compensable, the Arbitrator specifically dealt with Ms. McLean’s report. The Arbitrator noted that in support of her claim, Ms. Sun provided an In-Home Assessment conducted on October 20, 2005, by Dr. D. Morton, a chiropractor, who found that Ms. Sun should be entitled to some housekeeping assistance. She also noted that Dr. Perlmutter in his report of December 14, 2005 and Dr. Langer in his report of January 17, 2006 state that Ms. Sun was disabled from doing her housework. The Arbitrator preferred “the much more even handed and detailed report of Dr. Morton over that of Ms. McLean, who nevertheless allowed for the fact that Ms. Sun could not do all of her pre-accident housework.”

Accordingly, since this report does not address Ms. Sun’s circumstances as found by the Arbitrator, it provides no assistance in determining whether Ms. Sun has experienced a material change in circumstances since the arbitration decision.

Another example of a report that completely ignores the Arbitrator’s findings is that of Dr. R. Hercia, who conducted an orthopaedic surgery assessment on February 28, 2008. Considering that the Arbitrator found Ms. Sun to be psychologically disabled, it is doubtful that such an assessment would be useful. In any event, Dr. Hercia refers to a Multi Disciplinary IE Executive Summary Report from Makos Health Associates dated April 26, 2007, which found that “Ms. Sun did not demonstrate any physical disability that would substantially render her unable to perform her regular pre-accident employment…” This report was not even mentioned or discussed by the Arbitrator, by which I draw the inference that she did not place any weight upon it, but in any event the Arbitrator relied on Dr. Robinson’s opinion that Ms. Sun was disabled from a psychological perspective. Dr. Hercia also refers to Mr. Grimaldi’s report just discussed, which I have found is of no assistance. Finally, Dr. Hercia concludes that “it would appear that [Ms. Sun] sustained a WAD-II injury of her neck and a strain of the lower back.” This is irrelevant in light of the Arbitrator’s finding that Ms. Sun suffered a psychological impairment that removed her from the Grade II Whiplash Guideline. Thus, Dr. Hercia’s report as well provides no assistance to the initial issue at hand.

By way of contrast, Ms. Sun obtained the opinion of Dr. Tommy K.C. Chan, orthopaedic surgeon, dated September 10, 2009. Dr. Chan concludes that as a direct result of the accident, Ms. Sun suffered from myofascial injury to her neck and lower back, as well as a contusion to her right wrist and cervicogenic headaches. She still had limitation for prolonged sitting and standing. The prognosis was poor and unfavourable and the doctor did not see Ms. Sun being successfully reintegrated into the workforce from an orthopaedic point of view without vocational training.

Wawanesa also relies on the vocational assessment conducted by Ms. Addie Greco-Sanchez, rehabilitation professional, on March 6, 2008. The medical findings she cites are those of Dr. Hercia and Mr. Grimaldi, already discussed, and Dr. Brian Hines, psychiatrist, discussed below. The report indicates that an interpreter was used to communicate with Ms. Sun and that she would not be capable of working in settings where reading, writing and arithmetic are necessary but would be suited to occupations involving tools, equipment or machinery. Ms. Greco-Sanchez notes Ms. Sun’s potential barriers to employment include her lack of English skills, limited Canadian work experience, ongoing reported pain and discomfort, and physical and functional limitations noted in the medical findings. She finds that suitable employment alternatives were check room attendant, ticket taker, and inspector, tool and cutlery assembly. She concludes that from a vocational perspective, Ms. Sun was able to demonstrate skills and aptitudes that would enable her to be successfully employed.

Ms. Sun obtained a functional abilities evaluation and a vocational evaluation in response to those prepared for Wawanesa. Ms. Elsa Poon, OT, conducted a functional abilities evaluation on March 4, 2009. This report noted that Ms. Sun put forth a good effort but did not demonstrate the physical abilities to resume her pre-accident job. Ms. Poon recommended a vocational evaluation, and one was set out in a report by Ms. Elena Mazour and Ms. Sacha Thompson dated March 31, 2009. These evaluators agreed that the employment options that matched Ms. Sun’s aptitudes were the same as those identified by Ms. Greco-Sanchez, but stated that “these employment options were not recommended as it is our opinion that Ms. Sun did not demonstrate work behaviours that would be suitable in a competitive work environment.” They concluded that no suitable employment matches could be secured and that Ms. Sun was not considered a good candidate for return to work.

In any event, while Ms. Greco-Sanchez’s report may have identified potentially suitable jobs, it does not address Ms. Sun’s problems from a psychological perspective, leading me to a discussion of the remaining report on which Wawanesa relies, that of Dr. Hines.

Dr. Brian Hines, psychiatrist, assessed Ms. Sun on February 28, 2008. Ms. Sun told him that she recently had a boyfriend and delivered a baby about four months earlier and that she lived in a friend’s household where she was able to do light work, wash her own dishes and occasionally do laundry and cooking, but she was not able to sweep, mop, lift anything heavy or clear snow. Dr. Hines noted no particular distress when she used a taxi to get to the appointment, walked into the examining room, or was asked to complete the assessment after she had asked to stop early and finish another time. He writes:

Ms. Sun stated that her mood was depressed and frustrated, but had improved slightly. Objectively, she appeared euthymic and displayed a full and fluid range of affect. She stated that she sleeps three to four hours per night and that her sleep is interrupted. There was no objective evidence of any sleep deprivation. Her appetite is low and her weight has increased. She stated that her concentration is poor and not improving. There was no objective evidence of any difficulty with her concentration. She was alert, focused and attentive. There was no evidence of any preoccupations or distractibility. She was able to retain all of my questions and none required repeating. She stated that her memory is poor, but is slowly improving. There was no objective evidence of any difficulty with her memory. She was able to provide an adequately detailed history and all of her responses were spontaneous. There was no evidence of any difficulty with word finding or recall. She stated that her energy is poor, but it appeared within normal limits. There was no evidence of any lethargy or fatiguing as the interview progressed. She continues to be social, but stated that she gets pleasure from nothing because her life is boring.

Dr. Hines concluded that there was no evidence of any psychiatric illness and that she did not meet the post-104 week any occupation test. However, while Dr. Hines did repeat the conclusions of the reports of Dr. Perlmutter, Dr. Goldsmith and Dr. Robinson noted above, there was no attempt to correlate them with his findings or the conclusions of the Arbitrator. As with the other reports, this report seems to completely ignore the Arbitrator’s finding that Ms. Sun was psychologically disabled up to July 2007. Furthermore, the report obtained by Ms. Sun from Dr. J. Pilowsky, psychologist, drew an entirely different picture.

Dr. Pilowsky prepared a report dated August 27, 2009. Dr. Pilowsky found that Ms. Sun’s psychological symptoms had become engrained since the accident. Ms. Sun reported that she still suffers from heightened anxiety when traveling in a motor vehicle. She obtained a score of 36, or severe, on the Beck Anxiety Inventory, and 18, or severe, on the Beck Hopelessness Scale. Dr. Pilowsky concluded that Ms. Sun’s psychological condition had intensified and become entrenched. She found that Ms. Sun met the criteria for a moderate chronic major depressive episode, chronic pain disorder, and chronic symptoms of post-traumatic stress disorder. Dr. Pilowsky concluded that the accident was psychologically devastating, that Ms. Sun would not fully recover from her psychological difficulties stemming from the motor vehicle accident, and that she was disabled from any employment for which she was reasonably suited.

Wawanesa also relies on some surveillance taken of Ms. Sun. However, it is quite brief and not of much assistance. I draw no adverse inference from the fact that the assessors retained by Ms. Sun did not refer to it. While it shows Ms. Sun apparently being a passenger without any distress and briefly carrying some bags, I find the surveillance insufficient to show a material change in circumstances, let alone showing whether or not she could reasonably engage in any suitable occupation.

Therefore, I find that Wawanesa has failed to show that there has been a material change in circumstances because its assessors failed to properly address the issue.

Accordingly, it is not necessary for me to deal with the further issue of whether or not Ms. Sun meets the any occupation test, aside from the protection of benefits issue. However, I will make a couple of points.

Wawanesa submits that, as Ms. Sun was able to demonstrate some of the tasks associated with her pre-accident employment, she has not sustained a complete inability to return to work, including her pre-accident employment. It also submits that Ms. Sun’s assessors failed to properly address the any occupation test. For instance, it notes that Ms. Sun’s FAE concluded that Ms. Sun will have difficulty engaging in any full-time occupations and will have difficulty maintaining her ability to work, which it submits is more akin to substantial inability and not a complete inability. Similarly, it submits that Ms. Sun’s Vocational Evaluation Report did not conclude that Ms. Sun met the any occupation test because the assessors only opined that Ms. Sun would not be suitable in a competitive work environment and was not considered a good candidate for a return to work. In the same manner, Dr. Chan’s orthopaedic assessment only concluded that Ms. Sun’s prognosis was poor and unfavourable and questioned her ability to successfully return to work. Wawanesa therefore submits that “if a Claimant, has some ability, albeit, may encounter problems, such condition should not be deemed to be a complete inability and as such, such individuals should not be entitled to post-104 week IRBs.”

Wawanesa makes these submissions without referring to any case law. However, a test for post-104 week IRB entitlement is set out by Director’s Delegate Naylor in Canadian Surety Company and H.K., (FSCO P98-00041, February 29, 2000) as follows:

The appropriate approach is a flexible, fact-based one, in which, while the legal onus always remains on the insured, the sufficiency of the proof depends on what is reasonable in the circumstances. This involves consideration of the evidence presented by both parties, including the nature of the individual’s condition and extent of the disability, the efforts the insured has made to position himself or herself to return to the workforce, the vocational assistance made available by the insurer and the options for alternative work that have been put forward.

Furthermore, “complete inability” does not require a degree of impairment as high as “catastrophic impairment” so as to preclude legitimate claims for ongoing disability: Lombardi and State Farm Mutual Automobile Insurance Company, (FSCO A99-000957, April 11, 2001), upheld on this point in Lombardi and State Farm Mutual Automobile Insurance Company, (FSCO P01-00022, February 26, 2003). Arbitrators have also rejected a “50% + 1” rule, or “Could this individual do at least 50% of an occupation?” As was stated in Terry and Wawanesa Mutual Insurance Company, (FSCO A00-000017, July 12, 2001),

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)… Somehow the ability to engage in a reasonably suitable job, considered as a whole, including reasonable hours and productivity must be addressed.

I find that Ms. Sun’s assessors properly addressed the issues, even if they did not use the exact formulation from the SABS.

Even if I had found there was a material change in circumstances, I would still be inclined to look at the earlier psychological reports and not rely solely on the later ones. For instance, in Smyth and Zurich North America Canada, (FSCO A01-000623, December 17, 2004), the Arbitrator specifically found a post-104 week DAC unreliable and relied on an earlier, second DAC report to find that the applicant met the any occupation test “despite the fact that it did not specifically refer to the relevant test of eligibility or involve further assessments. I find that the psychological limitations identified by the second DAC were sufficiently disabling to render Ms. Smyth completely unable to engage in any employment, including employment which was not physically demanding.”

In this case, Dr. Hines’s report is completely inconsistent both with the medical assessments that found Ms. Sun disabled for psychological reasons before the hearing and with Dr. Pilowsky’s report. For that reason, if it were necessary to do so, I would prefer Dr. Pilowsky’s report over that of Dr. Hines.

Accordingly, Wawanesa’s application for variation or revocation is dismissed.

IV. EXPENSES

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