Tribunals Ontario Safety, Licensing Appeals and Standards Division Box 250 Toronto ON M7A 1N3 Tel: 1-844-242-0608 Fax: 416-327-6379 Website: www.slasto-tsapno.gov.on.ca

Tribunaux décisionnels Ontario Division de la sécurité des appels en matière de permis et des normes Boîte no 250 Toronto ON M7A 1N3 Tél. : 1-844-242-0608 Téléc. : 416-327-6379 Site Web : www.slasto-tsapno.gov.on.ca

Citation: S.M. vs. Unica Insurance Inc., 2020 ONLAT 18-010164/AABS

Before:

Jesse A. Boyce, Adjudicator

Date:

June 25, 2020

File:

18-010164/AABS

Case Name:

S.M. vs. Unica Insurance Inc.

Written Submissions by:

For the Applicant:

Gary Mazin Sara Kun

For the Respondent:

Angela Comella

1This request for reconsideration was filed by the respondent, Unica. It arises out of a decision in which the Tribunal found, amongst other benefits,¹ that the applicant, S.M., was entitled to up to $6,000 per month in attendant care benefits and a 25% award under s. 10 of O. Reg. 664² due to Unica’s unreasonable withholding or delay in the payment of benefits.

2Unica submits that the Tribunal acted outside of its jurisdiction and erred in law and fact in its determination. Unica requests the Tribunal reverse its decision on attendant care and the s. 10 award.

3Pursuant to Rule 18 of the Tribunal’s Common Rules of Practice and Procedure, I have been delegated responsibility to reconsider this matter. Accordingly, and to ensure the efficient resolution of this dispute, any relief requested was addressed in this decision rather than being sent back to the adjudicator at first instance.

RESULT

4Unica’s request for reconsideration is granted.

ANALYSIS

5The grounds for a request for reconsideration are contained in Rule 18.2 of the Tribunal’s Common Rules. A request for reconsideration will not be granted unless one of the following criteria are met:

a) The Tribunal acted outside its jurisdiction or violated the rules of natural justice or procedural fairness;

b) The Tribunal made an error of law or fact such that the Tribunal would likely have reached a different result had the error not been made;

c) The Tribunal heard false evidence from a party or witness, which was discovered only after the hearing and would have affected the result; or

d) There is new evidence that could not have reasonably been obtained earlier and would have affected the result.

6Here, the basis for Unica’s reconsideration request falls under Rule 18.2(a) and (b). Specifically, Unica submits that the Tribunal acted outside of its jurisdiction when it ordered up to $6,000 in attendant care because it failed to analyze the attendant care payments claimed by S.M. against the mandatory payment guidelines for attendant care under the Schedule.³ Second, Unica argues that the Tribunal erred in law by ordering a s.10 award in the amount of 25%, submitting that the award was not justified based on its conduct when adjusting the file and inflated unfairly by the Tribunal’s error in calculating the attendant care costs.

7S.M. submits that Unica’s request should be dismissed. First, he argues that the Tribunal did not act outside its jurisdiction in awarding $6,000 in attendant care. Second, that it was not error to find that an award under s. 10 was applicable because Unica’s conduct resulted in it unreasonably withholding payment to a catastrophic claimant. Finally, S.M. argues that none of the arguments offered by Unica would have resulted in a different result had the error not been made.

8For the reasons below, I agree with Unica. I grant its request for reconsideration under Rule 18.2(a) and (b) and find that the errors made in the original decision would have resulted in a different outcome had they not been made.

Background

9On March 16, 2014, S.M. was ice fishing on Lake Simcoe when the vehicle he was riding in hit a pressure crack and flipped, ejecting everyone inside. S.M. suffered a brain injury and multiple fractures as a result. On February 2, 2017, Unica deemed S.M. catastrophically impaired due to a marked impairment in the adaptation sphere and a 63% whole person impairment as a result of a combination of physical and mental-behavioural issues from the accident.

10A seven day, in-person hearing was conducted from July 15-23, 2019 to determine S.M.’s entitlement to attendant care, home modifications, the costs of two examinations, an award and interest. On January 2, 2020, the Tribunal released its decision, finding that S.M. was entitled to all the benefits claimed plus interest, except the cost of an attendant care assessment. The Tribunal also ordered a 25% award against Unica under s. 10 due to its unreasonable withholding of attendant care benefits and the difference in the home modification proposals.

11The focus of Unica’s reconsideration request is twofold: the calculation of the attendant care rates under the Guideline⁴ and Schedule and the s. 10 award.

Attendant care

12In its decision, the Tribunal made a finding that the attendant care services listed on the Form-1 completed by Ms. Kalp, S.M.’s Occupational Therapist (“OT”), dated April 19, 2017, were reasonable and necessary. Unica disagrees with the finding but accepts that this was a determination that the Tribunal could make. However, Unica submits that the Tribunal erred in failing to address the issue of the hourly rate charged by S.M.’s attendant care provider in favour of a monthly benefit.

13More specifically, Unica takes issue with the Tribunal’s finding at para. 34 that "[S.M.] is entitled to be paid the amounts that he has incurred in this regard as long as they do not exceed the Schedule limit of $6,000.00 per month" which it argues effectively compels it to pay an hourly rate for services which is greater than the maximum hourly rate amount prescribed by the Guideline authorized by the Schedule. Unica submits that the Tribunal does not have jurisdiction to order payment of an hourly rate greater than the rates prescribed by the Schedule and for that reason para. 34 of the decision constitutes an error of law and an exercise of authority outside of the Tribunal’s jurisdiction.

14In response, S.M. offers several arguments based in public policy and consumer protection. First, S.M. argues that the Tribunal decisions relied on by Unica are not binding but only persuasive. Second, he submits that the Tribunal’s decision was reasonable because higher rates are not prohibited and, out of practicality, parties “often agree to proceed at a higher rate to avoid payment to providers below the minimum wage.” Third, S.M. submits that the “stark difference” between the Tribunal’s decision and the three Tribunal decisions on which Unica relies raises issues of statutory interpretation. To this end, S.M. cites the Interpretation Act,⁵ the Legislation Act,⁶ Tomec v. Economical Insurance Co.,⁷ Smith v. Co-operators General Insurance Co.,⁸ Bapoo v. Co-operators General Insurance Co.,⁹ FSCO Guideline No. 01/18 and Bulletin A-03/18 to support his argument that the “hourly rate” approach to calculating attendant care “runs afoul of the consumer protection purpose of the legislation, the original legislative intent, purpose and meaning and instead leads to an absurd and discriminatory result even in contravention of the Charter.”

15While I am alive to S.M.’s arguments, I agree with Unica that the correct approach in assessing attendant care owing is the “hourly rate” approach. In my view, it is an error to simply look at the expense as presented on an invoice and order payment without a consideration of the number of hours of services received in relation to the hourly rates established on the Form-1 and/or by the Guideline. In a similar vein, it is error to simply state that an insured is entitled to “up to $6,000”, as the Tribunal did in this matter. While S.M. is correct that the Tribunal decisions on which Unica relies are not binding, the “hourly rate” approach was the approach taken in A.H. v. Belair Direct Insurance Company¹⁰ and in the Tribunal’s recent reconsideration decisions of S.K. v. Aviva and R.K. v. Aviva,¹¹ decisions that I find provide a helpful and, in my view, correct, framework for this analysis. S.K. and R.K. are especially on point. It is a technical and somewhat arduous exercise, but I find a mandatory one under the Guideline.

16Indeed, a plain reading of s. 19(2) of the Schedule makes it clear that all the components required to calculate attendant care were not considered in the Tribunal’s decision, as there is no discussion of the total number of hours per month of each type of care required or the hourly rate that was applied. While I agree with S.M. that the Tribunal “considered the substantive nature of the invoices” in paras. 26-34, I disagree that a consideration of the rates being over and above the Form-1 was “inherently taken into account” by the Tribunal or that the proper calculation of the attendant care amounts payable was made.

17Further, while S.M. references the apparent industry practice of agreeing to pay higher rates for service providers to prevent payments at or below minimum wage, I find no evidence on reconsideration that there was an agreement for same in place between Unica and S.M. In addition, I agree with Unica that there is no provision in the Schedule or in an Ontario automobile insurance policy which would guarantee to the insured that market rates for attendant care would be payable for attendant care services received. In a similar vein, I echo Unica’s submissions that the Schedule is not light on instances where funding available under the policy is not dictated by the market rate, for example: rates for professional services providers, policy limits, income replacement benefits, etc.

18With regards to S.M.’s submissions on statutory interpretation, I find nothing in the Schedule, the Guideline or FSCO Bulletin A-03/18 to suggest that there is ambiguity with respect to hourly rates for attendant care that would invite creative interpretation or a reading down of the legislation, as suggested. It would certainly be beyond the Tribunal’s jurisdiction to interpret the legislation in a certain way to alleviate the financial concerns of insureds who require attendant care or to pay the “going rate” for professionals who provide it. I disagree that the mandatory hourly rates in the Guideline run “afoul of the consumer protection purpose of the legislation, the original legislative intent, purpose and meaning,” as S.M. alleges. Even if I did agree, the Tribunal does not have the jurisdiction to execute such change.

19To be frank, and despite my findings above, I do agree with many of S.M.’s arguments concerning public policy and consumer protection and I agree that it can lead to absurd results where professional service providers are paid below minimum wage or market rates. S.M.’s submissions on the potential economic hardships that the hourly rate approach presents to insured’s, while speculative, were also not lost on me. However, the overarching fact remains that the hourly rates are mandatory and were in effect when S.M.’s accident occurred. Insurers are not liable to pay for expenses related to attendant care costs rendered to an insured person that exceed the maximum hourly rates set out in the Guideline.

20Adjudicators presented with reliable evidence of incurred attendant care should, where practicable, determine the specific amount of attendant care that is payable under the Guideline’s mandatory rates. Where there is evidence of incurred attendant care, it is error for adjudicators to simply order attendant care payable “up to” the amount identified by the Tribunal in the “issues” section or “up to” the amount identified by a specific section of the Schedule. While I do not consider this to be an egregious error of law by the Tribunal, I do find, contrary to S.M.’s submissions, that it results in a different conclusion. It is undisputed that S.M. is still entitled to attendant care. However, where it once could be interpreted that he was entitled to up to $6,000 allocated to his choosing, the different conclusion here is that he is now entitled to a specific amount of attendant care that he incurred during the period in dispute that does not exceed the mandatory hourly rate. The difference is subtle, but the ramifications, at least as they pertain to the amount owed for attendant care and the effect on the s. 10 award, are significant.

21Accordingly, having determined that the Tribunal erred in not calculating the quantum of attendant care incurred, it follows that this error, had it not been made, would have resulted in a different outcome. Therefore, it is prudent to determine it, as this amount will determine how much S.M. is owed for attendant care incurred and the applicable interest on same.

The attendant care calculation

22Unica’s request for relief relied on the “three ways to calculate attendant care” outlined in the S.K. and R.K. reconsiderations that ultimately sent the matter back to the original adjudicator. Rather than sending the matter back to a hearing on a very narrow issue and extending this dispute further, I have endeavored to calculate the attendant care payments incurred and owing here.

23As S.M.’s accident occurred on March 16, 2014, the applicable Guideline referenced the Form-1 hourly rates for service as follows: Part 1: $13.19; Part 2: $10.25; and Part 3: $19.35. S.M. submitted invoices which suggest that attendant care services were provided to him at rates between $20 and $35 per hour, which Unica argues is over and above the hourly rate prescribed on the Form-1 and identified in the Guideline.¹² On review, I agree. The invoices further indicate that services were provided to S.M. at the usage of 92-108 hours per month, depending on the month. On the invoices before the Tribunal, I am unable to discern what level of care was provided and how many hours of that level of care were received.

24At the hearing, Unica raised the issue that the invoices before the Tribunal contained no details of the services provided or the identity and professional designation of the specific service provider and that there were no logs prepared which outlined or described the services which were provided to S.M. or the level of care provided. However, it accepts that the Tribunal was able to make a finding that services were received as outlined on the invoices. I see no reason to interfere with the Tribunal’s determination. As a result, the only issue is quantum and the correct calculation of same according to Guideline No. 03/10.

25In the S.K. and R.K. reconsiderations, the Tribunal proposed three ways to calculate attendant care owing, while also suggesting that there may be more ways to do so. First, as there is no level of care identified in the invoices and the hearing transcript does not provide sufficient information of same, the Tribunal cannot attempt a direct allocation. Second, I disagree with the suggestion in S.K. and R.K. that a failure to provide the care rate in invoices amounts to S.M. not meeting his burden of proof concerning allocation and therefore the lowest Form-1 rates should be applied. I find this would be inequitable, would unfairly punish S.M. for the omissions of his provider and would further reduce payment for attendant care that he incurred and very well needs.

26Rather, in my view, without particulars in the invoices speaking to the level of care provided, the appropriate method to calculate the attendant care incurred and payable for the invoices in evidence is the remaining option proposed in the S.K. and R.K. reconsiderations. That is, to establish a percentage or “ratio” based on the Form-1 of Ms. Kalp, which the Tribunal determined was the recommendation most in line with the evidence and S.M.’s attendant care needs.¹³ In order to ascertain this baseline ratio, I reviewed the Form-1 of Ms. Kalp from April 2017. The Form-1 recommends the following, exclusive of HST:

Table 1

Level	Hours/Month	Rate	Total	% of Total	Adjusted
Part 1	89.83	$13.19	$1,184.91	19.7%	19.7%
Part 2	381.27	$10.25	$3,907.98	64.9%	64.9%
Part 3	47.95	$19.35	$927.74	15.4%	15.4%
Attendant Care Recommended:			$6,020.63¹⁴	100%

27As a result of this exercise, I have arrived at ratio percentages for the three Levels of Care, or “Parts”, in the Guideline. Based on Ms. Kalp’s Form-1, the hours listed in the invoices in evidence will be assigned an Attendant Care Rate according to a ratio as follows: 19.7% of the hours per month will be allocated to Part 1 care at the rate of $13.19 per hour; 64.9% of the hours per month will be allocated to Part 2 care at the rate of $10.25 per hour; and 15.4% of the hours per month will be allocated to Part 3 care at the rate of $19.35 per hour.

28Next, taking the percentage total of services as recommended by Ms. Kalp, I applied each percentage to each respective invoice in evidence, beginning in October 2017. As an example of the application of the equation, I used the first invoice for attendant care services from “Caring For U” dated July 31, 2017, which was used because it is outside of the period in dispute here. The total invoice was for $3,750, exclusive of HST, comprising 150 hours of care received at the rate of $25. With HST, the total is $4,237.50.

29As we know, the $25 rate charged is in excess of the maximum prescribed by the Guideline, so this number is disregarded. Again, since the level of care is not indicated, I take the percentages deduced from the Form-1 recommendations (identified in the far right column of Table 1, above) and applied each percentage to the 150 hours of care claimed by Caring For U in order to arrive at a monthly total for services rendered. While the total quantum is reduced, this calculation results in an amount that is in line with the maximum rates prescribed by the Guideline while also identifying a level of care rate that was previously missing but now supported by a ratio from Ms. Kalp’s monthly recommendations:

Table 2

EXAMPLE: Caring For U – July 31, 2017 Original Invoice: 150 Hours @ $25/hour = $3,750 (plus HST)

Level	Ratio % of Hours	Revised Hours	Rate	Total
Part 1	19.7% / 150	29.55	$13.19	$389.76
Part 2	64.9% / 150	97.35	$10.25	$997.84
Part 3	15.4% / 150	23.10	$19.35	$446.99
Total for Attendant Care Services =				$1,834.59
Plus 13 % HST =				$2,073.09

30As is evident in Table 2, when the invoice is calculated at the proper Guideline rates, the example amount payable for attendant care in July 2017 is reduced by a considerable amount: from $4,237.50 to $2,073.09, when accounting for HST. The amount is significantly lower than the $6,000 catastrophic maximum ordered by the Tribunal, roughly half the amount invoiced by Caring For U at the incorrect rate, but also 50% more than the $1,199.10 of attendant care previously approved by Unica. This calculation was repeated for every invoice in evidence using the same equation. Of note, the invoice for October 2017 was pro-rated for 18 days of attendant care to reflect the period in dispute. The truncated calculations can be found below in Appendix A to this reconsideration.

31Accordingly, I find the total amount incurred and payable for attendant care for the invoices in evidence, representing the period from October 13, 2017 to the most recent invoice in evidence, being June 30, 2019, is $39,496.87, less any amounts paid by Unica. As these benefits are incurred and overdue, interest applies, pursuant to s. 51 of the Schedule.

32For added clarity, this calculation only applies to the attendant care previously incurred by S.M. This amended attendant care total obviously affects the second issue in this reconsideration, being the 25% award under s. 10 of O. Reg. 664 that the Tribunal ordered, which I address in turn below.

Section 10 award

33On review of the submissions, evidence and transcript, I find that the s. 10 award should be set aside. While I respect the discretion of the first-instance hearing adjudicator to grant an award based on their weighing of the evidence, I find the award was not supported by the evidence of Unica’s conduct that was before the Tribunal, that the reasons supporting the award were not sufficient to justify the magnitude of the award and that the rationale provided significantly waters down the threshold of what constitutes an unreasonable withholding or delay of benefit payments by an insurer warranting an award under s. 10. I find these errors, if they had not been made, would have resulted in a different outcome.

34A brief recap. In its decision, the Tribunal ordered a 25% award under s. 10 of O. Reg. 664 due to a “[…] failure on the part of Unica or its agents to ask the relevant questions about [S.M.’s] functional needs.”¹⁵ While the Tribunal found that Unica paid for “most of the disputed benefits in part” and that it based its decisions on the assessments it completed, the Tribunal determined that on receipt of the Form-1, Unica’s assessors “should have investigated whether S.M. needed cuing, emotional support, and nighttime supervision” but found that they did not. Further, the Tribunal found it unreasonable of Unica to focus on the reports of its own OT’s, Ms. Ghatas and Ms. Paulson, when its own assessors found S.M. to be catastrophically impaired and the evidence confirmed that S.M. needed significant assistance for both physical and psycho-emotional needs. The Tribunal found Unica’s approach to be “imprudent, inflexible, and immoderate.”¹⁶

35Unica submits that the Tribunal erred in its analysis of the s. 10 award in relation to both attendant care benefits and the home modifications. Specifically, Unica submits that the Tribunal applied the wrong test in assessing its conduct in relation to the magnitude of the award and further submits that the Tribunal mischaracterized the evidence in forming a conclusion on the award. It relies on several cases, notably the FSCO case Plowright v. Wellington Insurance Co.,¹⁷ to support its argument that a special award ought not to be assessed simply because an adjudicator determined that an insurer got a decision wrong. Unica argues that for conduct to attract a special award, the conduct must rise above being an incorrect decision and be “excessive, imprudent, stubborn, inflexible, unyielding or immoderate.”¹⁸ On this basis, Unica submits that its adjuster's actions in this matter were not made without a rational basis and therefore they do not fall into the category of an unreasonable withholding of benefits. It argues that the decisions made by the adjuster do not demonstrate a pattern of conduct like the one described in Plowright and they do not represent an egregious, patently obvious error in adjusting, which is the standard endorsed by this Tribunal. It submits that the award is in error and is disproportionate.

36In response, S.M. submits that the Tribunal did not err, that there is ample evidence to support the award and that the criteria for an award were met. S.M. argues that the decision to grant an award is discretionary and fact-specific. Against the Plowright criteria, S.M. asserts that Unica’s behaviour meets the test. He submits that this case is not an instance of arriving at the wrong conclusion, as Unica submits, but engaging in unreasonable conduct. S.M. argues that the adjuster turned a “blind eye” and “closed her mind to other information” that may have affected her decision, including not seeking further medical opinions or addendums from assessors and not providing updated medical documentation to same when her own opinion allegedly differed from the experts. S.M. directs the Tribunal to paragraphs 64-73 of the decision as evidence that the adjudicator turned her mind to the requirements of the Schedule, did not order an award in contravention of it and reached a reasonable conclusion on the evidence.

Plowright and Unica’s conduct

37While it is an older decision and not binding on this Tribunal, I rely on the language and reasoning in Plowright. In submissions, both parties wrestled with this decision and I find it helpful in this analysis because the Tribunal used the “imprudent, inflexible and immoderate” language in its reasons granting the award even though it did not engage with the actual decision. As Unica submits, Plowright is an early decision in the realm of special awards under the former s. 282 of the Insurance Act and contains nearly identical language to the current s. 10 of O. Reg. 664. It has been oft-cited by FSCO and the Tribunal as a result. Unica relied on Plowright to show that even the most egregious conduct only attracted a 10% award, while S.M. relied on it to demonstrate that ordering an award is fact-specific and that Unica’s conduct still met the test of “excessive, imprudent, stubborn, inflexible, unyielding or immoderate” to warrant an award.

38So, what triggers an award? In Plowright, the insurer’s conduct included the following: terminating income replacement benefits for one year based on surveillance evidence without providing the basis for the termination and hiding the surveillance for a period of time; ignoring the recommendations of a treating family doctor which spoke directly to the issue; and failing to follow up with its own assessor who specifically identified a questionable issue with respect to the surveillance. I agree that the examples in Plowright show a pattern of bad faith decision making on the part of the adjuster who ignored the opinion of a treating family doctor, ignored the commentary of an IE assessor and terminated income benefits without providing a basis to the insured. The conduct in Plowright was found to be an “immoderate, imprudent, inflexible, and excessive” approach, as the arbitrator found the insurer’s decision-making to be “disturbing” and “puzzling.” The award was $2,000, less than 10% of the total benefits.

39It is well-settled that an award should not be ordered simply because an adjudicator determined that an insurer made an incorrect decision. Rather, in order to attract a s. 10 award, the insurer’s conduct must rise to the level described in Plowright—it must be excessive, imprudent, stubborn, inflexible, unyielding or immoderate. I agree with S.M. that a s.10 award is fact-specific. While I find the parties’ disagreed on many aspects of this file, I find limited evidence to support the Tribunal’s finding of fact that Unica’s conduct was “imprudent, inflexible and immoderate” in doing so, let alone evidence that it was excessive, stubborn or unyielding or that its conduct was similar to the “disturbing” or “puzzling” conduct displayed by the insurer in Plowright. On review, I struggle to understand how Unica’s adjusting decisions bear any resemblance to those in Plowright or how its decisions would justify a 25% award under s. 10 where S.M. was already deemed to be catastrophically impaired and the benefits in dispute were partially approved.

40Indeed, I find Unica accepted S.M. as catastrophically-impaired in 2017 and partially approved both the home modifications and his claims for attendant care that were before the Tribunal at first-instance. There was no termination of benefits whatsoever. The parties’ disagreement was not on entitlement to these benefits, but rather on what costs were reasonable and necessary, which was S.M.’s burden to prove. To reiterate, the benefits in dispute were a home modification comprised of a residential elevator and a therapy room and roughly 21 months of past attendant care. In my view, it was not imprudent, inflexible or immoderate of Unica to challenge the reasonableness of the cost of the home modifications where the parties were $181,164 apart in their estimations, with the difference largely attributable to a disagreement over a residential elevator and a therapy room. In my view, it was not imprudent, inflexible or immoderate of Unica to question whether overnight assistance was necessary where many of S.M.’s own practitioners did not even recommend it. Given my finding on attendant care, above, the decision to challenge the attendant care calculation was a wise one.

41While it is easy to be cynical, I also do not find that this was a situation where Unica was “papering” its denials with an unreasonable home modification report or assessing S.M.’s attendant care needs at zero. As Unica points out in submissions, this is also not a situation where it was continuously and unreasonably denying support to a catastrophically-impaired insured, as it was providing a significant number of services to S.M. for his accident-related impairments, including physiotherapy, social work services, rehabilitative support work services and outdoor maintenance, in addition to the partially approved attendant care and home modification funding. When adjusting these claims, Unica was entitled to rely on its reports to support its position. On review, I find the reports relied on by Unica were prepared by experienced professionals and their recommendations for the benefits in dispute were, in my view, made in good faith and reasonably supported by the bulk of the medical evidence. I find this is contrary to the Tribunal’s vague findings supporting the award in paras. 67-70 of the decision.

42On the evidence, I find it cannot be said that there was anything close to unanimous support from S.M.’s practitioners that the disputed benefits were reasonably required or that Unica’s position “was not supported elsewhere in the evidence” as the Tribunal determined at para. 68. In support of this, Unica directed the Tribunal to the evidence of S.M.’s neuropsychologist, Dr. Ali, his family doctor, Dr. Oschady and his treating physiatrist, Dr. Nguyen, none of whom recommended overnight supervision or proposed that an elevator be installed in S.M.’s home. Similarly, the notes of Dr. Warden and Dr. Furlan of [The Hospital], who followed S.M. after his discharge, do not contain recommendations for either of the disputed attendant care or home modifications. Further, S.M.’s application with the City of Toronto for social housing, including a room for an overnight attendant, was rejected on the basis that he had not established a medical need for an overnight attendant.

43On these facts, I agree with Unica that the Tribunal erred at para. 67 of its decision where it found that it was “unreasonable” of Unica to focus on the reports of its own OT’s, Ms. Ghatas and Ms. Paulson, over other evidence before it because S.M. was deemed catastrophic by its assessors and because “he had needs for physical and psycho-emotional assistance.” With this finding, I agree that the Tribunal conflated the fact that S.M. sustained a catastrophic impairment with the notion of entitlement to benefits, which is an error of law. While a catastrophic claim warrants greater scrutiny when adjusting a file, it does not mean that the insured is exempt from having to demonstrate that the goods and services they seek are reasonable and necessary, that an insurer cannot rely on its own reports or that an award should be imposed when recommendations in reports differ. Indeed, this type of dispute occurs on a smaller scale in virtually every file at the Tribunal without imposing an award.

44S.M. submits that the award here was not ordered as a result of Unica coming to the wrong conclusion, but because it engaged in unreasonable conduct. S.M. asserts that there are three instances where Unica’s adjuster made a conscious decision which justifies an award. First, S.M. alleges that Unica’s adjuster did not to obtain an opinion or addendum from Ms. Ghatas after receiving a new Form-1 from Ms. Chalova in November 2017, even though Ms. Ghatas’ Form-1 was completed in September 2017. Second, S.M. submits that the adjuster failed to provide Ms. Ghatas with updated information about S.M.’s fall in September 2018. Third, S.M. states that the award is justified because Unica’s adjuster failed to provide Ms. Paulson with his medical file prior to the home modification assessment. S.M. submits that this pattern is evidence that the adjuster “closed her mind” and “turned a blind eye” to other information that would have affected her decisions and is therefore in line with the threshold of Plowright.

45On review, and with great respect, the Tribunal’s decision does not address either of the first two allegations in its substantive discussion on the benefits in dispute or specifically in its analysis addressing the s. 10 award. Further, there is only a brief reference to the third allegation in para. 48, which I address below.

46With respect to the new Form-1 submitted by Ms. Chalova on behalf of S.M. in November 2017, I find the Tribunal made two separate findings in the decision dismissing Ms. Chalova’s Form-1. First, at para. 25, the Tribunal states that it is “not satisfied that this change is so significant as to warrant consideration of Ms. Chalova’s Form-1 contrary to s. 42(12) of the Schedule” because it was submitted within 52 weeks of the initial Form-1 from Ms. Kalp. Further to this point, I agree with Unica that under s. 42(12), it would not have been able to request an additional assessment for 52 weeks and therefore, its adjuster should not be “impugned for abiding by the restrictions” of the Schedule. Second, at para. 60, the Tribunal finds that “while there was a deterioration [in S.M.] between Ms. Kalp’s Form-1 and Ms. Chalova’s Form-1, it was not significant enough to be characterized as a change that would affect the amount of benefits that could be awarded by this Tribunal.” The Tribunal then found Ms. Chalova’s Form-1 to be not reasonable and necessary in its substantive analysis and does not mention it specifically in its reasons for the award. Where the Tribunal did not find a significant change to warrant consideration, where the Form-1 was improperly submitted by S.M., where Ms. Ghatas’s Form-1 was completed two months prior and where Unica was complying with the Schedule, I find it difficult to reconcile how the adjusters decision to not put Ms. Chalova’s Form-1 before Ms. Ghatas was evidence of unreasonable withholding or delay of benefit payments justifying an award.

47With respect to the medical documentation evidencing S.M.’s fall in September 2018 that was not provided to Ms. Ghatas, this allegation was not mentioned in the Tribunal’s decision as a reason supporting the award or analyzed anywhere else. Even if it were, it remains unclear how this omission in a four-year-old, catastrophic file is compelling evidence of unreasonable delay or the withholding of benefits that would attract an award under s. 10.

48Last, at para. 48, the Tribunal does address the medical file allegation, finding that Ms. Paulson conceded “that she did not have access to [S.M.’s] medical file when she opined that he did not require the elevator or the therapy room.” In the decision, the Tribunal did not admonish the adjuster or speak to bad faith on Unica’s part. Instead, it states, simply: “I give less weight to Ms. Paulson’s evidence as a result of these limitations.” Based on the transcript, it is unclear whether Ms. Paulson requested the medical file from Unica, let alone that this is compelling evidence that Unica’s adjuster “sat” on the file, intentionally withheld it or that the adjuster “should have known the importance and relevance of providing the medical file” as S.M. submits. While more information is always preferable—and Ms. Paulson did testify that a medical file would be helpful for her assessment—an in-person housing modification assessment is not a medical assessment.

49In any event, the error is that the Tribunal’s reasons for the award do not specifically address the allegation that medical information was intentionally withheld for the purposes of the home modification assessment. If that was the basis for the award, the reasons only vaguely address this point and it is couched, I suppose, in the statement that Unica did not turn “its mind to the larger context of information available to it from the evidence in this matter.” If that was indeed the basis for the award, I find it very questionable that this would attract an award given how tenuous the other evidence is.

The Tribunal made several errors in its analysis of attendant care that formed the basis for the s. 10 award

50I agree with Unica that the Tribunal’s finding at para. 66 that the adjuster ought to have asked assessors to investigate “whether S.M. needed cuing, emotional support and night time supervision” unfairly placed the adjuster in the role of a medical professional. Unica also submits that relying on the observations of a qualified OT who observed S.M. in his home and who recommended some level of attendant care services was not an unreasonable adjusting decision even if the Tribunal came to a different conclusion on S.M.’s entitlement. Again, I agree.

51With great respect, I trust this is obvious: insurance adjusters are not medical professionals and they should not be held to that standard. Insurance companies have a duty of good faith to adjust an insured’s file as claims are submitted, as new information becomes available, as their condition deteriorates, etc. However, while there is a duty of good faith, I find it is unreasonable and quite unfair to expect adjusters who come and go with some regularity to micromanage the assessments of qualified professionals to ensure that their reports respond directly to the specifics of a claim or else risk exposure to a s. 10 award if they do not. Generally, insurers should be able to rely on the expertise of professional assessors who conduct specific assessments for benefits under the Schedule in good faith. I find it was unreasonable of the Tribunal and an error to order a s. 10 award on the basis that Unica’s adjuster should have ensured that Ms. Ghatas asked S.M. about cuing, emotional support and night time supervision. This requirement—which I find differs from an insurer’s obligation to secure an addendum report in the face of new medical information or opinion—would unfairly and perhaps even recklessly extend the scope of an adjuster’s responsibilities moving forward.

52With respect to Unica’s attendant care proposal, I find Ms. Ghatas’ recommendations in her OT report are not completely untethered from the medical evidence as the Tribunal’s decision implies at para. 68. Instead, on review, I agree with Unica that the report features many areas of overlap with Ms. Kalp’s recommendations, with the total amounts being substantially different largely because of the bedroom and night-time components of Level Two care that were recommended. Yet, as I found above in my attendant care analysis, on reconsideration, the difference in attendant care services proposed by Ms. Kalp in her Form-1 and the attendant care services that were actually incurred by S.M. are also substantially different. Where the Tribunal relied on this polarity as evidence in support of an award, I find it was an error. Further, as noted above, there is quite a bit of medical evidence from S.M.’s own practitioners to suggest that S.M. did not actually require night time supervision, which, in my view, undermines Ms. Kalp’s report more than it does Ms. Ghatas’.

53In any event, the Tribunal was entitled to prefer Ms. Kalp’s attendant care recommendations over Ms. Ghatas’. To its credit, Unica does not dispute this and I have not interfered. However, I find that the Tribunal made a significant error when it based the s. 10 award on an inaccurate finding that Ms. Ghatas’ report did not “correspond to the information in S.M.’s medical file.” Indeed, based on the amount of attendant care actually incurred by S.M., it appears that Ms. Ghatas’ recommendations were more accurate. Had the Tribunal calculated the amount of attendant care incurred at first-instance, I suspect its opinion of Ms. Ghatas’ recommendations for attendant care would have changed. In turn, the major pillar supporting the s. 10 award would have crumbled.

The Tribunal erred in its analysis of the home modification proposal and provided insufficient reasons to support a s. 10 award on this basis

54With respect to the home modification proposals, Unica submits that its decision was based on S.M.’s medical evidence and Ms. Paulson's expert opinion. I agree with Unica that it was not unreasonable for its adjuster to rely on this report in partially approving S.M.’s home modification request and that its decision was in line with Tribunal jurisprudence concerning residential elevator modifications where insureds are not wheelchair-bound.¹⁹

55I find it was an error by the Tribunal to use the significant discrepancy in the proposed costs of the reports or her preference for S.M.’s home modification report as a basis for an award. Further, I find the reasons provided by the Tribunal confusingly lump the home modification issue together with the attendant care issue but do not specifically address the objectionable conduct for each. Like Ms. Ghatas’ attendant care recommendations above, Ms. Paulson suggested several home modifications that were identical to S.M.’s home modification proposal, with the variables being the residential elevator and the extra therapy room. Suffice to say, these types of modifications do not come up with great regularity—for the Tribunal to order S.M.’s modifications and then to also levy a 25% award on top of the difference requires, in my view, incontrovertible evidence of unreasonable or bad faith conduct or blind reliance on an objectively flawed report.

56On review of Ms. Paulson’s report, I find it was authored by a professional OT with decades of experience and the quote for the proposal was made by a reputable home modification specialist. Ms. Paulson explained her rationale for finding that a residential elevator was not required (S.M. was able to use stairs and did not use mobility devices in his home and she recommend a stairlift instead) and why a therapy room was not needed (S.M.’s home allegedly already had space for exercising and community exercise would help more with reintegration). In my view, these explanations are reasonable and generally supported by the medical evidence, even if the Tribunal found differently because Ms. Paulson “spent less time with S.M.” at her assessment and did not have the entire medical file before her. In any event, I find this is not a situation where Unica was “low-balling” S.M. or outright denying the benefit in bad faith either—the home modification proposed by Unica was partially approved at approximately $163,000.²⁰

57Against these facts, I agree with Unica that it was unfair, inaccurate and an error of fact for the Tribunal to suggest that the whole of S.M.’s medical evidence somehow pointed definitively at only one true or obvious outcome or that Unica ignored the medical evidence relating to his needs when it partially approved the benefits in dispute. The Tribunal’s finding at para. 68, that it “was not persuaded that Unica turned its mind to the larger context of information available to it from the evidence in this matter” is perplexing. On reconsideration, I also struggle to comprehend how Unica’s home modification proposal (and partial approval of $163,000) constituted an unreasonable withholding or delay justifying an award, as the Tribunal found at para. 70 or a failure on the part of Unica “to ask key questions about function that it should have on the basis of available information” to justify an award, as the Tribunal found at para. 72. The evidence does not support these findings.

The Tribunal’s decision watered down the threshold for a s. 10 award

58Finally, Unica submits that the implications of the decision as written raise “significant concerns for the insurance industry with respect to the ability of insurance adjusters to be able to rely on the expertise of independent medical examiners.” It submits that an award is completely unjustified and to find otherwise “waters down the threshold for a special award” and every claim denial which is later found to be payable by an adjudicator is subject to a special award. In response, S.M. submits that the 25% award was not inappropriate given Unica’s partial payment of benefits, because its adjusting meets the threshold for egregious conduct under Plowright and that the reasons provided by the Tribunal were sufficient.

59While Unica’s hypothetical is a bit dramatic, I do tend to agree here. On reconsideration, I find there is no behaviour described in the decision itself, or specifically in paras. 64-72 that address the award, that rises to the level of “excessive, imprudent, stubborn, inflexible, unyielding or immoderate” conduct warranting a s. 10 award in line with Plowright. The three issues identified by S.M. are not specifically addressed by the Tribunal’s reasons. The reasons articulated in paras. 64-72 seem to lump attendant care, home modifications and the reports of Ms. Ghatas and Ms. Paulson together but do not independently or accurately address where each went wrong or why these aspects of Unica’s adjusting were so “imprudent, inflexible, and immoderate.” Indeed, on the reasons provided and where Unica partially approved significant amounts of both benefits in dispute, none of the three Plowright adjectives used by the Tribunal come to mind.

60Further, while the Tribunal used adjectives from the Plowright decision in granting the award, it did not actually engage in an analysis of how Unica’s conduct in this matter was analogous to that case (or any of the Tribunal’s recent jurisprudence on s. 10 awards) or why it chose those adjectives to describe the allegedly unreasonable withholding of benefits. While the language of s. 10 provides discretion to the adjudicator to grant “up to 50% of the total benefits in dispute”, I find that discretion, once exercised, requires precision—that is, specific, accurate details of unreasonable conduct to support and justify the percentage awarded, so that the insurer understands the rationale. Beyond s. 10, this is a basic principle of administrative law. I find the reasons provided by the Tribunal in paras. 64-72, as detailed throughout this reconsideration, fall well short of this standard. Even the Tribunal’s reason at para. 70 incorrectly refers to the language of s. 10 as “an unreasonable withholding or denial” instead of the correct wording of “delay”. I find the magnitude of the award was not proportional to the blameworthiness of the conduct or the vulnerability of the applicant and, considering there were partial approvals for both benefits, I find there is no need for deterrence since there was no advantage wrongfully gained and there was no harm to S.M.²¹

61For these reasons, I find the Tribunal erred in ordering a 25% award under s. 10 of O. Reg. 664 because the award was not supported by the evidence of Unica’s conduct, the reasons supporting the award were not sufficient to justify the magnitude of the award and the rationale provided significantly waters down the threshold of what constitutes unreasonable withholding and delay. Accordingly, the award and applicable interest are set aside.

CONCLUSION

62Unica’s request for reconsideration is granted.

63S.M. is entitled to payment for attendant care services incurred for the period from October 13, 2017 to the most recent invoice in evidence, being June 30, 2019, in the amount of $39,496.87, plus HST, less any amounts paid by Unica. As these benefits are incurred and overdue, interest applies, pursuant to s. 51 of the Schedule.

64The Tribunal’s 25% award under s. 10 of O. Reg. 664 is set aside.

Released: June 25, 2020