Neutral Citation: 2018 ONFSCDRS 132 FSCO A11-001210

BETWEEN:

SEGRID CUMBERBATCH Applicant

and

THE GUARANTEE COMPANY OF NORTH AMERICA Insurer

REASONS FOR DECISION

Before: Alan G. Smith

Heard: In person at the Financial Services Commission of Ontario on January 17, 18, 19, February 16, March 29, 2018, and by written submissions completed April 25, 2018.

Appearances: Mr. Fabio Longo for Ms. Segrid Cumberbatch Mr. Alexander W. Neaves for Guarantee Company of North America

Issues:

The Applicant, Ms. Segrid Cumberbatch, was injured in a motor vehicle accident on May 22, 2008, (the “accident”), and sought accident benefits from Guarantee Company of North America (“Guarantee” or the “Insurer”), payable under the Schedule.¹ The parties were unable to resolve their disputes through mediation, and Ms. Cumberbatch, through her representative, applied for arbitration at the Financial Services Commission of Ontario (“FSCO”) under the Insurance Act, R.S.O. 1990, c. I.8, as amended.

The issues in this Hearing are:

What amount of Attendant Care Benefits (“ACB”) is Ms. Cumberbatch entitled to receive monthly from September 16, 2014, to date and ongoing?
Is Ms. Cumberbatch entitled to interest for the overdue payment of ACB?
Is Guarantee liable to pay a Special Award because it unreasonably withheld or delayed payments to Ms. Cumberbatch?
Is Guarantee liable to pay Ms. Cumberbatch’s expenses in respect of the arbitration?
Is Ms. Cumberbatch liable to pay Guarantee’s expenses in respect of the arbitration?

Result:

Ms. Cumberbatch is entitled to receive ACB in the following amounts:
- $1,728.19 per month from September 16, 2014, to October 21, 2017;
- $2,593.67 per month from October 22, 2017 to date and ongoing;
Ms. Cumberbatch is entitled to interest for the overdue payment of ACB. If the parties cannot come to an agreement on the quantum of the amount owing pursuant to the directions in my decision, they may deliver written submissions to FSCO of no more than 5 pages each, the Applicant’s submissions to be delivered within 30 days of the date of this decision and the Insurer’s submissions to be delivered within 14 days thereafter.
Guarantee is liable to pay a Special Award because it unreasonably withheld or delayed payments to Ms. Cumberbatch. If the parties cannot come to an agreement on the quantum of the award, either party may request in writing an appointment before an FSCO arbitrator to determine the quantum of the award, provided the request is made within 30 days from the date of this decision.
Expenses shall be payable. If the parties cannot come to an agreement on the matter of expenses, either party may request in writing an appointment before a FSCO arbitrator to determine expenses, provided the request is made within 30 days from the date of this decision.

BACKGROUND

CHRONOLOGY OF EVENTS

May 22, 2008: Accident;
2008: Chiropractic and Occupational Therapist (“OT”) Application for Accident Benefits (OCF-1, also known as a “Form 1”) submitted;
May 2008 – May 2009: Income Replacement Benefits (“IRB”) paid by the Insurer;
February 28, 2012: Income Replacement Benefits reinstated with retroactive payment, but no interest paid;
2012: Application for Determination of Catastrophic Impairment (OCF-19) submitted;
September 16, 2014: OCF-1 of Occupational Therapist R. Neufeld claiming $1,728.19/month submitted;
January 28, 2016: Decision finding the Applicant Catastrophically Impaired released by Arbitrator Mutch. The Insurer acknowledges entitlement to ACB and Housekeeping and Home Maintenance Benefit (“HK”);
July 31, 2016: OCF-1 of Occupational Therapist A. Lee claiming $1,701.58/month submitted;
April to November 2016: Applicant receives personal support worker services from the Insurer;
September 8, 2016: Clinical Psychologist Dr. Chan report released finding that the Applicant did not have any functional limitations or restrictions;
November 1, 2016: Registered Social Worker G. Phinney releases recommendations for rejection of need for further rehabilitative therapy;
November 9, 2016: RSW Phinney releases paper review (including OCF-1) with recommendation that no further ACB be provided;
September 21, 2017: Appeal decision of Director’s Delegate Evans released upholding Catastrophic determination by Arbitrator Mutch;
October 22, 2017: OCF-1 of OT Neufeld claiming $2,593.67 /month submitted;

ISSUES IN DISPUTE

On January 15, 2018, 2 days before the arbitration hearing began, a resumed pre-hearing discussion was held with the parties. The parties agreed that the following were still issues in dispute:

Quantum of and Entitlement to ACB from the accident and ongoing;
Quantum of and Entitlement to HK from the accident to date and ongoing;
The Guarantee conceded entitlement to IRB with prejudice following the Pre-hearing and paid outstanding interest on IRBs owed. The issue of IRB entitlement was removed:
Special Award for IRB, HK and ACB remained an issue to be determined;
Expenses of the Hearing; and
Interest for the overdue payment of benefits.

On the first day of the arbitration hearing the Insurer conceded the following:

Entitlement to ACB from May 22, 2008 to January 17, 2018, at a rate of $1,200.00 per month, plus applicable statutory interest,
Is entitled to HK from May 22, 2008 to January 17, 2018, at a rate of $100.00 per week, plus applicable statutory interest; and
Entitlement to unpaid interest, for IRB reinstated on February 29, 2012.

The hearing therefore proceeded to determine:

The quantum of ACB from September 16, 2014 to date and ongoing², plus applicable statutory interest;
The quantum of HK from the date of the hearing and ongoing;
The entitlement to a Special Award for: i. Unreasonably withholding ACB from September 16, 2014 to the first day of the hearing; ii. Unreasonably withholding HK from the accident to the first day of the hearing; and iii. For unreasonably withholding the IRB from May 1, 2009 to February 29, 2012 and then from December 5, 2012 to April 1, 2016 and delayed payment of statutory interest on the IRB.

The Applicant accepted the quantum of $1,200.00 per month for ACB from the accident up to September 15, 2014. Thereafter, it is the Applicant’s position that her monthly entitlement to ACBs is $1,728.19, and later $2,593.67, as set out in the OCF-1’s dated September 16, 2014 and October 22, 2017.

In their written submissions the parties advised that, after the end of the arbitration hearing, they had agreed that Applicant’s HK needs are at least $100/week, which is the statutory maximum benefit. Therefore, as the Insurer states in its submissions, “it is prepared to pay the applicant $100 per week for the housekeeping benefit going forward for incurred expenses, so long as she continues to meet the disability test”. Accordingly, I have not addressed the HK quantum issue in this decision.

EVIDENCE

THE DECISION OF ARBITRATOR MUTCH

The sole issue before Arbitrator Mutch was that of whether the Applicant was Catastrophically Impaired pursuant to the Schedule³. Notwithstanding that, I find that many of the factual determinations the Arbitrator made are applicable to the issue of ACB in the present arbitration.

As Director Delegate Evans summed up Arbitrator Mutch’s findings⁴:

Since the accident, she suffered pain and depression, lacked motivation, avoided social situations, and had trouble concentrating and remembering things. She was not able to return to work, discontinued most of her volunteer activities, and only returned to church sporadically from 2012 on. After her son was born about five months after the accident, she had mostly stayed home to take care of him. She testified that she struggled to initiate and complete household tasks and inconsistently cared for herself, like bathing, washing her hair and brushing her teeth.

The Arbitrator found that the Applicant’s, “difficulties are not so much the completion of tasks, but that she has difficulty initiating tasks, and that she does things on an irregular and haphazard basis”.

WITNESS TESTIMONY

The Applicant

It her written submissions the Applicant accurately relates much of the testimony she provided at the hearing:

With respect to hair care, Ms. Cumberbatch reported that following the accident, she was not taking care of her hair such that she was required to shave it off. She further testified that she only washes her hair once it starts to smell, sometimes going months without washing it, despite wanting to do it. The Applicant noted that decreased motivation and initiation interferes with her showering and bathing, and that her personal hygiene gets so bad that her husband questions whether or not she showered. With respect to dressing, the Applicant stated that she often wears the same clothes for days, and sleeps in the clothes she wears all day. When she undresses, clothes frequently form a pile on the floor or bed.

The Applicant testified that her bed is not made every day and that she will go months without changing the bed linens, owed to a lack of motivation. The Applicant testified a decreased ability to make meals owing to a lack of motivation or memory problems. She provided a number of examples where she has forgotten about items on the stove or in the oven. With respect to brushing her teeth, the Applicant testified that she sometimes goes weeks without brushing her teeth, resulting in teeth sensitivity and bruised gums. The Applicant reported that her nail care has been neglected, and that she requires assistance from her husband and 9-year-old son. The Applicant also reported to wearing make-up regularly prior to the accident, but now she rarely does, does not wash her face as often, and that she does not wear make-up because she just doesn’t “feel like it” anymore. She noted changes in her skin from neglect in care. With respect to exercise, she stated that when she exercises she experiences headaches and pain and that she needs someone to assist her, or a professional to guide her.

The Insurer also provided a summary of the Applicant’s cross examination:

During her cross-examination, the applicant agreed largely with Ms. Phinney’s description of her typical day at that time, which included waking up at 5 or 5:30 a.m., doing 20-30 minutes of worship, watering the lawn and garden (something for which she was not responsible pre-accident), attending church regularly, taking her son to activities, attending a monthly couples’ group at her church with her husband, and assisting her son with homework. She indicated that her report to Ms. Phinney of showering daily was her “objective” and “not the reality”. She stated that while Ms. Phinney’s description of her typical day at that time all made sense, some of the activities were not done in the consistent manner that the report suggested.

The applicant described on cross-examination her role in providing assistance with the dropping-off of students at her son’s school, which involved ensuring the children got out of their parents’ vehicles quickly to improve the flow of morning traffic in the school driveway. She described going for morning walks independently after doing this….

The Applicant also stated in cross-examination that she has minimized or even withheld her level of dysfunction to different assessors. She would hide the mess and bathe when she knew an assessor was coming to her home. She would sometimes under-report her difficulties to assessors out of fear and/or shame.

Caron Gan – Family Therapist

Ms. Gan testified that she had provided family counselling to the Applicant and her husband. She had witnessed a deterioration of the Applicant’s condition over the last 5 years.

In cross-examination the witness conceded that she had no first-hand knowledge of the Applicant’s need for ACB or HK benefits. She relied only on self reporting from the Applicant and the Applicant’s husband.

Rene Neufeld - OT

OT Neufeld has been the Applicant’s treating OT since 2014. In her written submissions the Applicant accurately relates much of the testimony OT Neufeld provided at the hearing:

She gave expert evidence outlining the role of an OT and the professional obligation to conduct a holistic assessment. OT Neufeld testified that in the case of the Applicant, it seemed strange that OT Phinney did not complete cognitive testing, but that testing ought to have been conducted. OT Neufeld explained that the College of Occupational Therapists of Ontario mandates a holistic approach, meaning “looking at not just the physical aspects of the person, looking at the whole person.”

OT Neufeld testified that the Applicant has expressed embarrassment about her lack of personal hygiene and about having others comment on her lack of hygiene practices. OT Neufeld testified that through treatment she has observed the Applicant’s difficulties with attendant care issues of hair care, make-up, the manner in which she dresses and her overall appearance. OT Neufeld testified that the Applicant requires assistance particularly when there are competing demands placed upon her. OT Neufeld stated that, as part of all Form 1 reports, she considered the Applicant’s need for encouragement, cueing required to complete a task, ongoing emotional issues, memory impairments, executive function and issues with being overwhelmed.

OT Neufeld testified at length about supervisory care. OT Neufeld stated that many of the Applicant’s difficulties are motivational and in task follow-through, she captured difficulties with dressing/undressing, bathing, planning, coordination and lack of motivation under this heading, due to needs for “custodial care due to changes in behaviour.” OT Neufeld was asked during cross-examination about the Ontario Society of Occupational Therapists (“OSOT”) Reflective Practice Resource and her approach relative to this guideline. OT Neufeld and the OSOT resource confirm that increased supervisory care is appropriate when cueing cannot be scheduled such as, in the case of the Applicant, where it is unpredictable.

Furthermore, with respect to cueing, OT Neufeld testified that cueing is frequently not sufficient for the Applicant and that where cueing is insufficient, an attendant’s presence is necessary to ensure tasks are completed. OT Neufeld also stated that in situations where the Applicant is experiencing an exacerbation of her pain and headaches symptoms, she requires someone else to carry-out the activity.

OT Neufeld noted that while goals have been established, none of them have been achieved and that the Applicant regressed during a lapse in treatment. She also explained that the Applicant’s functioning regressed due to the withdrawal of treatment and PSW assistance in November 2016.

OT Neufeld confirmed in her evidence that meal preparation for oneself is appropriately considered as attendant care, whereas meal preparation for others falls under the category of HK. Under the large heading in the Form 1 of “Feeding”, there is a subheading titled “Meal Preparation.” The amount of time for meal preparation relates to the time that would be spent making meals for herself, including the time to initiate, perform and complete the task.

With regard as to whether basic supervisory care could be provided from a distance, Ms. Neufeld testified that, in her professional opinion, whether the assistance is provided from a distance, or in-person, in the Applicant’s case, the time allocated would not change. Ms. Neufeld noted that the recommended needs, as reported on the OCF-1’s she completed, account for the time it takes to wholly complete the task.

The witness testified that the time allocations she provided in the OCF-1’s were “conservative.”

The Insurer also provided a summary of Ms. Neufeld’s cross examination:

During her cross-examination, Ms. Neufeld acknowledged the guidance provided on page 17 of the OSOT guide that, when assessing attendant care for a person with cognitive limitations, the time allotment for any cueing should be included in each area of the Form 1. She testified that, for the specific areas of attendant care for which she identified a need for assistance in the 2014 and 2017 Form 1s, any cueing for those tasks (feeding, medication, hair care, toenails, exercise) was included within the times she allotted for those activities. In other words, she followed the guidance in the OSOT guide. She further confirmed that the amounts for basic supervisory care that she recommended did not encompass the aforesaid specific attendant care tasks for which she dealt with individually in the Form 1.

Accompanying the 2014 Form 1 was a progress report written by Ms. Neufeld with the same date. Ms. Neufeld admitted during her cross-examination that the treatment goals discussed in that report did not relate to attendant care. When it was put to her that her report contained no specific information as to what cueing was needed for attendant care tasks, Ms. Neufeld responded, “Not at length, because…it was a progress report”. She admitted that the only information she provided regarding the need for basic supervisory care were the words in the Form 1 themselves, “…needs custodial care due to changes in behaviour”.

In an attempt to explain during her testimony, the four hours of basic supervisory care that she recommended in the 2014 Form 1, Ms. Neufeld stated that the applicant had “intermittent” needs for tasks such as getting dressed, bathing, and with “coordination, organizing, planning and completing tasks throughout her entire day”, for which the applicant required both “cueing” and “hands-on support”. Ms. Neufeld thought it best to provide for this need in the basic supervisory care section of the Form 1. During her cross-examination, Ms. Neufeld again attempted to explain that her recommendation for basic supervisory care was for needs such as getting dressed and bathing (both of which tasks she put “0” down for on both the Form 1 and her written report) and even for “getting her son off to school”.

Soula Bobotsis - Adjuster

Ms. Bobotsis testified that while the decision of Arbitrator Mutch was in relation to catastrophic impairment, she understood he found that the Applicant was less than independent in her daily activities including housekeeping tasks. She also agreed that the Arbitrator had found it was emotional impairments which were the cause of the Applicant’s restrictions. The witness conceded that medical reports consistently confirmed that the Applicant’s issues were in relation to negative emotion, fatigue and lack of motivation interfering with her functionality.

The witness did not give a clear answer as to why the release of Arbitrator Mutch’s decision was chosen as the appropriate date to reinstate the Applicant’s ACB and HK. When questioned why the Insurer only paid HK at $12/hour, the witness agreed that the market rate for HK was $26/hour, and that limiting it to $12/hour was unreasonable.

When questioned about a 2009 report by OT Lyndy Goldlust which found that no HK benefits were justified, the witness admitted that it was unfair to accept the conclusion of a report if it was inconsistent with the body of the report. When questioned regarding the seeming discrepancy between charts contained in Ms. Goldlust’s report and the OT’s conclusions, Ms. Bobotsis testified that if was not her job to review graphs within a report, and stated, “I just take, you know, her summary of that”.

Ms. Bobotsis admitted that the Applicant should have been paid the interest due on the withheld IRB in 2012, when the benefit was reinstated retroactively.

Ms. Bobotsis conceded in cross-examination it was unreasonable for OT Phinney, in reports dated July 2013, August 2014, and April 2015, to mischaracterize Psychologist Dr. Frank’s opinion in relation to causation of the Applicant’s psychological impairments

The witness testified that notwithstanding cognitive testing was an important insight for her as an adjuster, she relied on OT Phinney’s examinations and reports which did not include any cognitive testing. Ms. Bobotsis further stated that in a report authored by Dr. Marino at some point between 2011 and 2013, Dr. Marino opined that “all these treaters were missing the cognitive issue”. Nonetheless, Ms. Bobotsis testified that she continued to believe Ms. Phinney’s analysis was sound. She pointed to the medical opinions cited by Ms. Phinney, for example psychologist Dr. Chan’s opinion dated September 2016 that, psychologically, the Applicant suffered no functional limitations. She also relied on what Ms. Phinney reported observing and hearing from the Applicant herself during the three-hour assessment in October 2016, as noted in OT Phinney’s November 2016 report.

Ms. Bobotsis testified that, in 2016, the insurer had approved almost $57,000 in treatment. This she believed may have accounted for an improvement in the applicant’s functioning by the time she saw Ms. Phinney later that year.

The witness conceded that OT Neufeld’s OCF-1 of September 2014, setting out an ACB monthly total of $1,728.14, was the most accurate reflection of the Applicant’s impairments at the time. Furthermore, the witness agreed it was unreasonable to choose to pay only $602/month in ACB instead of the $1,728.14 recommended by OT Neufeld.

Ms. Bobotsis testified this was a “very difficult file to adjust”.

ANALYSIS

ATTENDANT CARE QUANTUM

The OCF-1’s

The Insurer provided the following chronology:

There have been three Form 1s submitted on behalf of the applicant since September 16, 2014.

For the period from September 16, 2014 to October 18, 2017, the applicant relies on a Form 1 dated September 16, 2014 completed by occupational therapist Rena Neufeld of Joanne Romas & Associates (the 2014 Form 1). The 2014 Form 1 recommended attendant care for feeding (an hour per day), basic supervisory care (four hours per day) and medication (ten minutes per day).

A second Form 1 was completed on May 18, 2016 by Amee Le of Joanne Romas & Associates (the 2016 Form 1). Ms. Le did not testify and the applicant’s counsel has indicated that they are not relying on this Form 1 other than to the extent it supports the recommendations in the 2014 Form 1. The 2016 Form 1 recommended hair care (25 minutes per day), feeding (an hour and a half per day), and basic supervisory care (four hours per day). At the applicable hourly rates for an OT, the total recommendation amounted to $1,701.58 per month.

A third Form 1 is relied on by the applicant for the period from October 18, 2017 to the present; this was completed by Ms. Neufeld on October 18, 2017 (the 2017 Form 1). In this Form 1, attendant care was recommended for hair care (15 minutes per day), toenail care (15 minutes per week), feeding (an hour per day), basic supervisory care (six hours per day), coordination of attendant care (an hour per week), and exercise (one hour per day). At the applicable hourly rates, the total recommendation amounted to $2,593.67.

As noted above, the only relevant assessment produced by the Insurer was in November 2016 by RSW Phinney which recommended that no further ACB be provided.

Should new OCF-1’s be constructed?

The Applicant argues that:

The quantum of ACB is to be determined by the trier of fact. However, this case is unique in that the only Form 1s tendered in evidence before the learned Arbitrator for the relevant period after September 2014 are from the Applicant’s OTs. The professional opinions of OT Neufeld and OT Le are uncontroverted because the Guarantee explicitly chose not to obtain responding Form 1s. More importantly, it is the Applicant’s position that the professional opinions of OT Le and OT Neufeld are entirely consistent with the documentary evidence, oral evidence, and grounded in standards required by the College of Occupational Therapists and applicable guidelines.

In its written submissions the Insurer argues, “…the applicant’s entitlement to attendant care between September 16, 2014 and the present has not been more than $1,200 per month and should be assessed at substantially less than that going forward. The real dispute is how much if any basic supervisory care should be allotted”. Therefore, the Insurer takes the position that I should, in essence, construct my own OCF-1’s.

I agree with the Applicant that, “While it remains the authority of the arbitrator to ultimately determine the quantum of ACB, arbitrators have been cautioned against constructing a Form 1”. I am also cognizant that this is not a process of “final offer selection” i.e., I am not bound to select one party’s assessments over that of the other. The question is what is appropriate in the circumstances. I note that the issue was addressed by Arbitrator Mills in Whyte v. State Farm⁵. In that decision the Arbitrator found that the quantum of ACB required could be reasonably based on a retroactive OCF-1 with substantiation from testimony at the hearing. Given the unique situation in the present case, where the only relevant OCF-1’s provided were by the Applicant, in my view the correct approach is to take the same approach as was taken in Whyte. I therefore decline to construct new OCF-1’s and will base the quantum of ACB on the OCF-1’s provided in evidence at the hearing substantiated by the testimony of the Applicant and OT Neufeld.

In taking this approach I reject the argument of the Insurer that O.T. Neufeld failed to follow the “guidelines” provided in the OSOT guide when completing the OCF-1’s ie., in not providing specific information as to what cueing was needed for attendant care tasks. I agree with the Applicant that the Insurer’s ACB argument:

…rests almost entirely in its misunderstanding of the OSOT Resource, specifically its role and application. The OSOT Resource is not a Guideline as identified by the Guarantee. Furthermore, it is not mandated by the College Occupational Therapist. More specifically, it cannot be used to replace or challenge the professional skills, opinion or competence of an OT completing a Form-1.

Are the OCF-1 Hourly Rates Correct?

The Insurer argues that, “While Ms. Neufeld quantified [the 2014] Form 1 at $1,728.19 per month, she mistakenly used the OT hourly rates that apply for accidents that occur on or after September 1, 2010. Using the correct hourly rates, as indicated on the Form 1 itself, the amount of the 2014 Form 1 should be $1,481.78 per month.

The Applicant responds that:

There are two significant issues with this argument. First, it must be rejected as it violates the rule in Browne v. Dunn. This problem was never raised with Ms. Neufeld in cross-examination and she was never given the opportunity to explain or clarify her professional opinion in this regard. It would be prejudicial to the Applicant to allow the Guarantee to raise this issue at this juncture…. Another example of prejudice stems from the Applicant being deprived of the opportunity in re-direct to explicitly question her professional opinion as to the hours necessary, having the benefit of the medical evidence available today. If this was a live issue at the hearing, her professional opinion would have been of important use to the Tribunal in determining the appropriate quantum of ACB. Secondly, this argument entirely and conveniently ignores Ms. Neufeld’s testimony that the amounts she gave in the 2014 Form-1 were “conservative.” Even if she erred in the rates she applied, it was her professional opinion the hours allotted by her were low and should have been higher. Therefore, there is medical evidence and an OT opinion which justifies an attendant care amount in excess of the 2014 Form-1. The quantum of attendant care is properly to be determined by the Arbitrator in this case and the Applicant submits that the appropriate amount should be $1728.19 per month or higher.

I agree with the Applicant that, as the hourly rate issue was never raised during the arbitration hearing, it would be unfair for me to consider it now. I also agree that OT Neufeld clearly indicated that her time estimations were “conservative”, thus alleviating any concerns that an inflated dollar value was calculated.

Conclusion

In the result, I find that the evidence of OT Neufeld was reasonable and to be preferred over the findings of OT Phinney, particularly because OT Neufeld reflects a holistic approach to the assessment of the Applicant as explained below in the discussion regarding a Special Award.

I conclude that the Applicant is entitled to ACB benefits on the following basis:

$1,728.19 per month from September 16, 2014, to October 21, 2017;
$2,593.67 per month from October 22, 2017 to date and ongoing.

SPECIAL AWARD

The Law

Section 282(10) of the applicable Ontario Insurance Act⁶ provides the statutory basis for me to make a Special Award:

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 lump sum of up to 50 per cent of the amount to 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.

Entitlement to a Special Award is therefore contingent on the Insurer’s behaviour having been “unreasonable”. In Erickson and The Guarantee,⁷ the Oxford English Dictionary definition of “unreasonable” was relied on. The Arbitrator found that “unreasonable” required, “1. Going beyond the limits of what is reasonable or equitable; 2. Not guided by or listening to reason”.⁸ FSCO jurisprudence also establishes that an insurer’s actions could be determined to have been unreasonable without having been egregious or performed in bad faith.⁹ In Plowright and Wellington¹⁰ Arbitrator Palmer described unreasonable behaviour in the withholding of payments as, “behaviour which was excessive, imprudent, stubborn, inflexible, unyielding or immoderate”.

It is not appropriate to award a Special Award in all cases. As noted in Aviva Canada Inc. v. Peters,¹¹ “an insurer is not to be held to a standard of perfection in responding to a claim, that an insurer’s claims decision is to be judged on the basis of the information available at the time, and not from hindsight, and that an insurer is not to be found unreasonable just because an Arbitrator concludes its claims decision was wrong.”¹² Similarly, Arbitrator Feldman noted in Melchiorre and Guarantee Mutual Insurance Company¹³ that a Special Award will not be awarded in every case. Arbitrator Feldman stated:

A Special Award is not granted merely because the insurer incorrectly interpreted or failed to comply with a provision of the Schedule; if that were the case, a Special Award would be granted to every successful applicant. An insurer can come to the wrong conclusion without having acted unreasonably. To merit the granting of a Special Award, there must be something more - unreasonable conduct on the part of the insurer.¹⁴

Even where benefits in dispute are resolved, it is established that an Arbitrator retains jurisdiction to consider a Special Award despite payment of outstanding benefits on the eve of the hearing¹⁵. The unilateral action of an insurer in agreeing to pay the benefits at issue does not necessarily dispose of the question of a Special Award.¹⁶ To do so would allow a delayed payment, as contemplated by section 282 (10), to be made so as to end a proceeding and strip an Arbitrator of the jurisdiction to make an award.¹⁷ A stand-alone claim for a Special Award will not succeed, however a claim can proceed despite benefits being paid on the eve of the hearing.¹⁸

Analysis

Should IRB (and Interest) be Considered?

The jurisprudence, as noted above, is clear that a claim can proceed despite benefits being paid on the eve of the hearing. In the present case IRB were reinstated in 2012, some 6 years before the beginning of the hearing. I therefore decline to consider a Special Award regarding IRB. However, as the interest on the retroactive IRB remained unpaid until the time of the hearing, I have jurisdiction to consider a Special Award regarding that amount. By the same token I will also consider a Special Award for HK and interest.

Was the Insurer’s Conduct Unreasonable with Regard to HK and ACB and IRB Interest

The Insurer argues that:

…it was reasonable for Ms. Phinney to rely on the expertise of Dr. Chan. She was in no better position than Dr. Chan, a licensed clinical psychologist, to comment on whether the applicant suffered from a cognitive disorder, nor was Ms. Phinney. (Ms. Neufeld herself admitted she is not a “diagnostician”.) In addition to relying on Dr. Chan, Ms. Phinney herself observed that during the three-hour assessment, the applicant was oriented to person, place and time. The applicant answered Ms. Phinney’s questions in an appropriate and timely manner. She was able to follow instructions and to provide correct data. Ms. Phinney noted no cognitive difficulties….

It must not be over-looked that on the applicant’s own evidence, discussed during her cross-examination, she has minimized or even withheld her level of dysfunction to different assessors. She would hide the mess and bathe when she knew an assessor was coming to her home. She would sometimes under-report her difficulties to assessors out of fear and/or shame. While this may be understandable, it is still conduct that puts an assessor in a very difficult position to be able to gain an accurate and complete picture. Ms. Phinney should not be faulted for this, nor should the insurer.

I note that Ms. Bobotsis testified that the Applicant’s claim was, “a very difficult file to adjust”.

The Applicant counters that:

…the Guarantee engaged in mechanical and “routine”’ denials, absent reason, which are grounds for special award. The Applicant was sent to OT Phinney seven times and seven times she denied treatment and benefits….

It is illogical for the Guarantee to say that it was reasonable to rely on OT Phinney and Dr. Chan at the time, when it has conceded on cross examination a number of serious deficiencies with reports from those authors. A review of these report at the time was clearly not done. These opinions were not compared and contrasted with the totality of the evidence. [emphasis in original]…

There is no precedent case in which an insurer disregarded the findings of an Arbitrator and denied benefits based on opinions that were in clear contradiction to an Arbitrator’s findings….

In light of this mass of evidence explicitly stating that she remained impaired, it was not reasonable for Ms. Bobotsis to rely on the inconsistent reports of Dr. Chan and OT Phinney. The reports are inconsistent with the decision of Arbitrator Mutch from mere months before. Months of treatment did not miraculously cure 8 years of neglect by an insurer [emphasis in original]….

At page 2 of its submissions, the Guarantee concedes entitlement to HK and the maximum of $100 per week. This is after the Guarantee has forced the Applicant to a hearing to prove her entitlement to a benefit that it ought to have paid at the outset of the claim. The Applicant submits that this concession is another example of litigation tactics, which has…no place in accident benefits….

In its submissions in relation to the November 2016 denial of HK and ACB, the Guarantee explicitly submits at page 15, it only relied on two opinions, that of Dr. Chan and OT Phinney. In doing so, it concedes it did not consider the totality of the medical evidence. This is unreasonable as set out in the case law. Making a determination for a benefit requires the application of “all of the available medical evidence to the legal test.” Where assessors’ opinions are entirely inconsistent with the totality of the medical evidence, it is deemed to be “unreasonable” to rely on those assessors....Ms. Bobotsis acknowledged that she read all the reports. The Applicant submits…the evidence is clear that she did not give them any close scrutiny or analyze their conclusions in a critical manner.

I agree with the Insurer that the Applicant’s file was a difficult one to adjust. Nonetheless, I believe the actions of the Insurer do meet the threshold test of “unreasonableness” to justify a Special Award for HK, ACB and the interest associated with those benefits.

I find that OT Phinney’s numerous assessments and treatment denials were unreasonable. As Ms. Bobotsis testified, the insurer was cautioned by Dr. Marino that the “all these treaters were missing the cognitive issue”. Arbitrator Mutch found that the Applicant suffered pain and depression, lacked motivation, avoided social situations, and had trouble concentrating and remembering things. The Insurer disregarded all these warnings. Ms. Phinney continued to focus solely on the Applicant’s physical abilities while ignoring the Applicant’s cognitive and emotional issues. I accept OT Neufeld’s testimony that College of Occupational Therapists of Ontario mandates a holistic approach, meaning looking at not just the physical aspects of the person, but looking at the whole person. I agree with the Applicant that Ms. Phinney, far from taking the appropriate holistic approach, engaged in, “mechanical and routine denials, absent reason”. I therefore find Ms. Phinney’s continued recommendation that the Applicant did not require HK or ACB unreasonable. It therefore follows that the Insurer’s reliance on Ms. Phinney’s recommendations was also unreasonable with respect to HK and ACB.

Ms. Bobotsis admitted in testimony that there were serious deficiencies in the assessments and recommendations proffered by Dr. Chan, OT Goldhurst and OT Phinney. Ms. Bobotsis conceded in testimony that medical reports she received about the Applicant’s impairments consistently confirmed that the Applicant’s issues were in relation to negative emotion, fatigue and lack of motivation interfering with her ability to function normally. Nonetheless, at the time she was adjusting the Applicant’s file she failed to properly scrutinize the reports of Dr. Chan, OT Goldhurst and OT Phinney. I find that this was also unreasonable behaviour on the part of the Insurer regarding HK and ACB.

Finally, a Special Award is justified regarding the IRB interest. The fact that the interest payment was outstanding for some 6 years without explanation speaks for itself in terms of being unreasonable. I also note that Ms. Bobotsis admitted in testimony that the Applicant should have been paid the interest due on the withheld IRB in 2012, when the benefit was reinstated retroactively. This reflects an unreasonable modus operandi on the part of the Insurer.

Quantum of the Special Award

It should be made clear that my above findings speak only to entitlement for a Special Award. They should in no way be construed as addressing the legal test for the quantum of the award. I find only that the threshold test of “unreasonableness” on the part of the Insurer is established and thus a Special Award is mandated.

The Applicant has requested the opportunity to make further submissions on quantifying a Special Award. The insurer requested the same opportunity. Therefore, if the parties cannot come to an agreement on the quantum of the award, either party may request in writing an appointment before a FSCO Arbitrator to determine the quantum of the award, provided the request is made within 30 days from the date of this decision.

EXPENSES

Expenses shall be payable. If the parties cannot come to an agreement on the matter of expenses, either party may request in writing an appointment before a FSCO Arbitrator to determine expenses, provided the request is made within 30 days from the date of this decision. Pursuant to the Arbitration Order accompanying this decision, FSCO remains seized regarding the quantum of the expenses payable.

INTEREST

Pursuant to the Schedule, the Applicant is entitled to interest for the overdue payment of benefits. I leave it to the parties to calculate interest on the overdue benefits in the prescribed manner.

If the parties cannot come to an agreement on the quantum of the amount owing, they may deliver written submissions to FSCO of no more than 5 pages each, the Applicant’s submissions to be delivered within 30 days of the date of this decision and the Insurer’s submissions to be delivered within 14 days thereafter. Therefore, FSCO will remain seized regarding the quantum of the interest payable.

July 27, 2018

Alan G. Smith Arbitrator

Financial Services Commission of Ontario