REASONS FOR DECISION

Before: Arbitrator Kenneth J. Conroy

Heard: In person at ADR Chambers on December 14, 15 & 16, 2015, February 29, 2016 and March 1 & 2, 2016 with written submissions due May 17, 2016

Appearances: Mr. Henry Lastowski participated Mr. Sandev Purewal participated for Mr. Henry Lastowski Mr. Darrell March participated for State Farm Mutual Automobile Insurance Company

Issues:

The Applicant, Mr. Henry Lastowski, was injured in a motor vehicle accident on January 18, 2011 and sought accident benefits from State Farm Mutual Automobile Insurance Company ("State Farm"), payable under the SABS.¹ The parties were unable to resolve their disputes through mediation, and Mr. Lastowski, through his representative, 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. Lastowski entitled to receive a weekly income replacement benefit in the amount of $400.00 from January 19, 2013 to date and ongoing?
Is State Farm liable to pay a special award because it unreasonably withheld or delayed payments to Mr. Lastowski?
Is Mr. Lastowski entitled to interest for the overdue payment of benefits?
Is State Farm liable to pay Mr. Lastowski's expenses in respect of the Arbitration?
Is Mr. Lastowski liable to pay State Farm's expenses in respect of the Arbitration?

Result:

Mr. Lastowski is not entitled to receive a weekly income replacement benefit of $400.00 per week from January 19, 2013 to date and ongoing.
State Farm is not liable to pay a special award to Mr. Lastowski as it did not unreasonably withhold or delay payments to Mr. Lastowski.
State Farm is not liable to pay Mr. Lastowski interest for overdue payments of benefits.
State Farm is not liable to pay Mr. Lastowski's expenses of the Arbitration.
State Farm is entitled to its expenses of the Arbitration. If the parties are unable to agree on the entitlement to, or quantum of the expenses of this matter, the parties may request an appointment with me for determination of same in accordance with Rules 75 to 79 of the Dispute Resolution Practice Code.

EVIDENCE AND ANALYSIS:

The Applicant was involved as a pedestrian in a motor vehicle accident on January 18, 2011. As a result of the accident, the Applicant sustained injuries to his left wrist, right leg and right winged scapula. Surgical intervention was required and the Applicant did not return to work as a result. The Applicant is a 50 year old male who at the time of the accident was working for Deluxe Stair & Railing Ltd., but he had been employed as a stair builder since 1995 and that was the job he held when the accident occurred. The Applicant gave evidence that he completed high school 33 years ago. The evidence would suggest that the Applicant was a skilled stair builder having performed that job for many years. He earned $24.00 per hour and was working full-time with Deluxe when he was injured in the subject motor vehicle accident. His job required him to obtain a work order and material list, gather the required material, plan and then build the required work project. The Applicant would routinely use a table saw, router, sanders and band saw. The Applicant gave evidence that he enjoyed his work and took pride in the fact that he was often given more complex tasks such as circular staircases because of his skill. There is no dispute or issue to be addressed relating to the Applicant's employment status at the time of the accident and State Farm admittedly paid income replacement benefits to the Applicant to the 104 week mark pursuant to the SABS.

Evidence at the Hearing contained in Dr. Schatzker's assessment for the Applicant suggested that as a result of the accident, the Applicant sustained injuries, described above, that required orthopaedic surgery. His injuries were stated to be a traumatic lesion of the long thoracic nerve of Bell with a resultant paralysis of the serratus anterior, functional winging of his right scapula and shoulder dysfunction. The resulting loss of his scapular stability made it impossible for him to maintain, with any degree of strength, elevation of his right upper extremity beyond 90 degrees. He is apparently unable to lift weights above waist level away from his body as the scapula collapses as well as his upper extremity. The conclusion from this evidence is that the Applicant is not capable of any overhead work or overhead lifting.

There was a further impairment of the right knee and as a result, the Applicant has difficulties with prolonged standing, walking and in particular, climbing and walking on uneven ground. Further, as a result of a complex fracture of the right tibia, he walks with a limp thus limiting the length and distance that he is able to walk and stand. It is not anticipated that further recovery will occur.

Dr. Schatzker further opined that as a result of the combined injuries, the Applicant is not suited for employment requiring sustained work at shoulder level or above or any repetitive use of his right upper extremity and is not able to return to his regular trade.² However, at no time does Dr. Schatzker indicate that the Applicant suffers a complete inability to engage in employment and in fact, the report would suggest that the Applicant would be able to engage in any employment that does not involve sustained work at the shoulder level, repetitive use of the Applicant's right upper extremity, prolonged standing, prolonged walking and carrying weight.

Numerous medical reports and assessments were relied on as evidence throughout the Hearing, which confirmed the injuries sustained, but remarkably none went so far as to suggest that Mr. Lastowski suffered a complete inability to engage in any employment or self-employment for which he is reasonably suited by education, training or experience.

The test for income replacement benefit entitlement after week 104 is found in Section 6(2)(b) of the SABS:

(2) The insurer is not required to pay an income replacement benefit,

(b) after the first 104 weeks of disability, unless, as a result of the accident, the insured person is suffering a complete inability to engage in any employment or self-employment for which he or she is reasonably suited by education, training or experience.

In the present Arbitration, both the Applicant and State Farm presented into evidence Vocational Reports setting out the Applicant's vocational skills, abilities, suitable jobs and limitations. Although each of the Applicant and State Farm cited flaws in the other's reports, it was apparent to me that there were jobs that the Applicant could properly do as contained in the reports that would not require significant training such as order desk clerk, telephone sales agent, bench assembler and bench woodworking. The Applicant gave evidence of his desire to get back into the workplace but produced no evidence whatsoever that he was making any effort to do so. Simple woodworking skills possessed by the Applicant would readily enable him to do work at his own pace and time. He does not do so even for the sake of being 'self-employed' to some extent with the skills he had prior to the accident. The Applicant raised the issue of what he would be paid for such jobs and argued that the drop in pay should be considered as a valid reason for not being required to take such positions. I would submit that this wage issue is merely a factor to take into consideration. There is no evidence before me that the Applicant was offered any position with lower wages. What was significant to me in hearing the evidence presented was that at no time was there evidence presented of efforts made by the Applicant to secure suitable employment; he arguably being resigned to the fact that he could not work. It would have gone a long way to support the Applicant's position if there had been evidence of attempts to retrain, efforts to obtain employment deemed suitable by the experts or confirmation of the fact that the Applicant could not function at any job that he might have secured. The Applicant failed to satisfy me that he made those efforts and the evidence would suggest that, in fact, he did not. The conclusion that I draw from that lack of effort and supporting evidence was that the Applicant did not desire to do anything else that was not his former job and skill. In fact, he did not establish that he did in any manner whatsoever apply for or secure such possible positions, whether or not he excelled at same or was unable to retain the position. The mere effort of attempting to do so could have supported the Applicant's position that he is not employable. That did not occur and as a result I have concluded that he refuses to engage in any employment for which he may have been suited. The onus is on the Applicant to establish that he suffers a complete inability to engage in any employment to which he is reasonably suited. In that regard the Applicant has failed to do so and I therefore conclude that he is not entitled to post 104 week income replacement benefits.

EXPENSES:

State Farm is entitled to its expenses of the Arbitration. The parties have yet to make submissions on expenses. They are encouraged to resolve the issue. If the parties are unable to agree on the entitlement to, or quantum of the expenses of this matter, the parties may request an appointment with me for determination of same in accordance with Rules 75 to 79 of the Dispute Resolution Practice Code.

August 2, 2016

Kenneth J. Conroy Arbitrator

Financial Services Commission of Ontario

Neutral Citation: 2016 ONFSCDRS 208 FSCO A13-008008

BETWEEN:

HENRY LASTOWSKI Applicant

and

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY Insurer

ARBITRATION ORDER

Under section 282 of the Insurance Act, R.S.O. 1990, c. I.8, as it read immediately before being amended by Schedule 3 to the Fighting Fraud and Reducing Automobile Insurance Rates Act, 2014, and Ontario Regulation 664, as amended, it is ordered:

Mr. Lastowski is not entitled to receive a weekly income replacement benefit of $400.00 per week from January 19, 2013 to date and ongoing.
State Farm is not liable to pay a special award to Mr. Lastowski as it did not unreasonably withhold or delay payments to Mr. Lastowski.
State Farm is not liable to pay Mr. Lastowski interest for overdue payments of benefits.
State Farm is not liable to pay Mr. Lastowski's expenses of the Arbitration.
State Farm is entitled to its expenses of the Arbitration. If the parties are unable to agree on the entitlement to, or quantum of the expenses of this matter, the parties may request an appointment with me for determination of same in accordance with Rules 75 to 79 of the Dispute Resolution Practice Code.