flaherty-sloan-hatfield

Ontarians Have Overpaid for Their Auto Insurance by over 3 Billion Dollars

Mon, 11 May 2015 15:02:07 GMT

We are paying something for nothing. The mandatory accident benefits policy in Ontario provides minimal coverage for the vast number of people injured in car accidents . Presently, over 90% of victims are restricted to payment of a maximum of $3,500.00. They are forced by law to pay hundreds if not thousands of dollar PER YEAR for this coverage.

Ask yourself. Would you voluntarily pay $1,000.00 per year of $3,500.00 worth of life insurance? Of course not. But the Government of Ontario forces you to pay for this very poor product.

It’s time to speak to your Member of Provincial Parliament.

See the full facts here. http://truthaboutinsurance.ca/drs-lazar-prisman-report/

Ontario Budget a Disaster for Anyone Injured in or by a Motor Vehicle

Mon, 11 May 2015 14:56:57 GMT

The Ontario Trial Lawyers Association has prepared a series of blogs identifying current issues with the recent budget and how it impacts people injured by Motor vehicles. Please read the full blog here. http://otlablog.com/hidden-costs-of-the-provincial-budget/

Part One of a Three-Part Series on the 2015 Ontario Budget

Last month, the Ontario Liberal government revealed its latest budget entitled “Building Ontario Up” but what it does to our auto insurance benefits is actually the opposite by significantly slashing benefits available to accident victims.

This follows promises that tout more affordable insurance but do not disclose the true cost to those who find themselves in need of the coverage now, and those who will unfortunately need the protection in the future.

The rationale of the Liberal government is that the reduced benefits will lower claim costs which will then be passed on to the consumer in the form of savings on premiums. A promise to reduce rates by 15% was made about two years ago but in reality, and by their own admission, has not been realized. It is estimated that since 2013 rates have decreased by only about 7%, and many of us still have not seen that reduction. On the other hand, the cuts to benefits will be effective immediately once the budget is passed.

The reduced premiums come at the cost of a 50% slash to (or total elimination of) many benefits that were once part of mandatory insurance coverage prior to the 2010 reforms. The erosion of available benefits is disproportionate to any rate decrease and is unfair to consumers.

According to the Liberal budget, “…costs in Ontario’s auto insurance system remain too high,” While a reduction in claim costs is welcomed by consumers and stakeholders alike, it can be achieved through other means. For example, as discussed on the OTLA blog following the release of Justice Cunningham’s review of the Dispute Resolution System late last year, insurers spent thousands of dollars on Independent Medical Assessments which account for roughly 25% of total health claims expenses. Despite this, the Liberal government made the choice to save costs by reducing available benefits rather than regulating insurer practices.

The insurance industry has been crying poor through persistent lobbying (that also comes at a great cost), while profits have been on the rise since the initial cuts began in 2010. The latest benefit cuts will surely continue to boost these margins. Data released by the General Insurance Statistical Agency (GISA) suggests a dramatic reduction in Accident Benefit claims from $3.8 billion in 2009 to a low of $1.9 billion in 2012. While claims over the past year were projected to rise to $2.2 billion they are still down overall. This has allowed insurers to reap massive profits at the expense of those who need it most: accident victims. Profits remain high, payments to claimants remain low, and benefits are further restricted with trivial savings that may never end up in the consumer’s pocket.

What additional cuts can we expect from this budget?

The budget combines the medical and rehabilitation benefit which currently offers $50,000 of coverage and the attendant care benefit which currently offers $36,000 of coverage into one cumulative coverage limit of $65,000 – a reduction of more than $20,000.

In the case of the catastrophically injured, attendant care and medical and rehabilitation benefits have been reduced from $2 million to a combined total of $1 million. This begs the question: is a 50% reduction in benefits worth a 7% reduction in premiums to some consumers in Ontario?

The real kicker is that Ontario NDP leader Andrea Horwath – whose party propped up the Liberal minority in exchange for the 15% reduction to auto premiums – has publicly opposed the proposed changes stating,

“…if you are talking to the insurance industry, they are going to try to paint it in a way that looks like they are really struggling. I don’t think anyone in this room believes that for a minute and I certainly don’t.”

She went on further to say that

“…in 2010 the (Liberal) government made changes to the policies around insurance and all that did, instead of creating an opportunity for reductions, is it created an opportunity for insurance companies to pocket more money.”

So what has the Liberal government and the insurance industry offered the public in exchange for the slashing of benefits? A mandatory discount for winter tires. Think about that the next time you’re shopping for a set of Michelins.

This blog post was contributed by Michael Giordano, Junior Partner and Monty Dhaliwal, Associate Lawyer of Sal Guzzo LL. B.

Ontario auto insurance: How much worse can things get for victims?

Fri, 23 May 2014 14:54:56 GMT

Ontario auto insurance: How much worse can things get for victims?

Changes in 2010 created windfall profits for insurers by slashing coverage for the vast majority.

We need to restore fairness and impose a moratorium on further reductions in coverage!

In September 2010, the Ontario government introduced sweeping changes to auto insurance in response to pressure from the insurance industry to contain injury costs despite the industry’s long-standing failure to address systemic fraud in the system.

The MIG: Minor Injury Guideline for victims

The main feature of the so-called reforms was the MIG – the Minor Injury Guideline. What did it mean? Coverage for the vast majority of policyholders was slashed from $100,000 for medical and rehabilitation treatment to the paltry level of $3,500 maximum for medical and rehab needs following an accident. The MIG currently captures up to 75 per cent of all accident victims in Ontario, often without regard for the seriousness of the injuries involved. OTLA members report that many clients in the MIG typically exhaust their maximum benefit of $3,500 very quickly, leaving them without access to needed treatment. Clients are often forced in the Minor Injury category despite having injuries that could not reasonably be considered as “minor” e.g. serious fractures and brain injuries.

The MIG: Major Income Generator for insurance companies

It’s really no surprise what happens when premiums are increased and insurance payments are dramatically reduced for most injured accidents victims. In fact, the “good news” for insurance companies started to become apparent almost immediately. Here’s what one insurance CEO quipped, perhaps a bit too candidly, mere months after the changes:

“We are starting to see the benefits of the 2010 auto reforms in Ontario, which is combining with our recent focus on proactive broker management and underwriting discipline to generate stronger results.”

The early trend that this CEO was talking about here materialized and, by the end of 2012, total auto insurance claims were down more than 20 per cent or a reduction of $4 billion. The tally for auto insurers was more than $3 billion in profits in the first two years following the 2010 changes. Early indications for 2013 indicate that auto insurance companies in Ontario continue to enjoy strong results to this day. It should come as little surprise to anyone that insurance companies are doing extremely well under this model: then again, you can’t lose when you’re charging more and paying out a lot less.

Ontario, now the worst coverage in the country

As a result of the September 2010 changes, Ontario emerged as the only jurisdiction in the country with a special category of insurance for so-called “minor” injuries. And, significantly, Ontario has the lowest level of compensation for this category of injury. Even the insurance industry’s own data supports this contention with average claims payouts down dramatically from previous levels and more claimants than ever being captured by the MIG.

But how much worse can things get for victims?

Once again, columnist Alan Shanoff has documented the steady slide in coverage over the past few years in Ontario. Read his comments here. He ends his article this way:

“One thing is certain. The current system can’t get much worse for accident victims. Victims need timely, adequate accident benefits even more than they need premium cuts.”

Help make things better for victims!

As a candidate, here’s how you can help ensure that the system doesn’t get any worse for victims:

Demand that your party impose a moratorium on further auto insurance coverage reductions

It’s time for our politicians to stop worrying about how to allow insurance companies to make more money, and start concerning themselves with how to restore fairness in our automobile insurance system.

Red Flags Raised over Insurer Financial Data

Tue, 06 May 2014 18:51:19 GMT

The following article appears in the Law Times

In response to complaints that insurance industry financial details are impossible to pin down, the Ministry of Finance commissioned a report on transparency and accountability in the sector but perhaps surprisingly chose the accountants for the Insurance Bureau of Canada to prepare it.

On April 14, the interim report became the first of three reports from financial consulting firm KPMG LLP as part of the auto insurance cost- and rate-reduction strategy. It will deliver the annual reports in August of each year of the strategy.

Only months earlier, however, KPMG had done work for the Insurance Bureau of Canada to support its position that profitability is low despite the reforms of 2010. A year before that, KPMG had done work for the same organization to support a very large estimate of the cost of fraud to the insurance industry.

“How can you hire the IBC’s accountant and financial advisers to do a report that is supposed to be independent?” asks Adam Wagman of Howie Sacks & Henry LLP.

“Not only don’t they try to steer away from the apparent conflict, they dig right into it by repeating conclusions formed as part of doing work for them. How can that possibly be right?”

Nick Gurevich, president of the Alliance of Community Medical and Rehabilitation Providers, echoes that sentiment. “The selection of the consultant is unusual given how much work they have done in the past for the IBC. They are clearly a very capable global accounting firm with a stellar reputation, but there are plenty of comparable accounting and consulting firms that could have done it without such ties to the IBC.”

In response to the concerns, KPMG would only say it was the government that requested the report and it’s only obligation was to it.

Wagman suggests the province’s auditor general would be a truly independent party.

“I can’t imagine the auditor general coming out with an interim report that parrots the recommendations of one stakeholder. Whether or not I like what they would have to say, I would accept that they have done it independently.”

The report itself is highly technical and repeats insurer arguments as to why there’s uncertainty in the figures without making any attempt to independently ascertain what they are. “I read it until my brain began to bleed,” says Wagman.

“If the goal is transparency and accountability, then I ask: transparent and accountable to whom? I don’t think there’s anyone in government who would understand it either. The 10 actuaries in the province might understand what they’re talking about, but it reeks of bias and lack of objectivity.”

He continues: “The purpose, dating back to the budget, was to look at the financial and economic impact of the reforms. Is there one mention of profitability? To the extent that it does talk about return on equity, it refers back to the report last year about insurance performance. There are no actual dollar figures and they fail to mention that those findings came out in a report commissioned by the IBC.”

Gurevich suggests the report in general lacks objective verification. The information relied on comes from financial statements and survey results prepared by the insurance companies and the General Insurance Statistical Agency as well as certain financial and return assumptions provided by the Financial Services Commission of Ontario.

“All you see is a regurgitation of information provided by the insurance industry without KPMG going in and verifying it independently. Much of the report refers to estimates and what the figures could be or might be.”

Gurevich believes the lack of certainty was the catalyst for commissioning the report in the first place. “The entire point of this process is to assist the government and members of the opposition who feel they don’t have a good grasp on the financial state of the industry. What was needed was an objective third party to go in and verify and test the numbers to tell them what the actual numbers are given that the insurance industry has a vested interest to produce overly conservative figures to generate more cost-cutting measures. It is disappointing that the report didn’t do what it was supposed to do.”

Specifically, the insurer information points to an improvement in the calendar-year claim ratio of 18 per cent from 2010-11, 23 per cent from 2010-12, and approximately two per cent from 2012-13 with the 2013 claim ratio being 74 per cent. Despite this, KPMG concludes the industry is still not at the break-even point.

Wagman says the percentages tell the story rather than the conclusion. “See the loss ratios. They are dropping like a hot-air balloon. If you look at how the numbers have gone, it’s been very good for them. Nobody can say otherwise. To not even be at the break-even point, they must have mismanaged their book of business so badly it boggles the mind.”

The report also repeats insurer estimates of a decrease in accident benefits of 46 per cent that Gurevich says is highly suspicious. “We have seen a decrease close to 82 per cent in medical rehabilitation benefits, 77 per cent of attendant-care benefits, and almost 99 per cent of housekeeping and caregiver benefits. That insurers claim they are only seeing a 46-per-cent decrease is very suspect. The benefits are just not there, so it doesn’t make any sense.”

The interim report acknowledges that KPMG sought no other input apart from insurance industry players and declines to make recommendations until it has sought input from other stakeholders “who may have a different perspective to share with the government.”

Wagman says he almost laughed out loud at that point. “It’s almost tongue-in-cheek to say others may have a different perspective. They clearly know full well that others have a very different perspective.”

Wagman also feels that by repeating the insurers’ recommendations and then discussing them at length, the report gives credence to them. “If they needed to do more work to study the current financial viability of the industry, why list the recommendations of insurers? It’s a very shotgun approach.”

Gurevich suggests insurers have good reason to paint a very bleak picture of their financial position. “This data should be carefully scrubbed, verified, and tested and not just be a repetition of what the insurers say. The nine million drivers and 65,000 accident victims each year who will rely on the findings deserve much more than just taking the insurance industry’s word at face value.”

The End of Bill 171 (for now)

Mon, 05 May 2014 19:03:15 GMT

The recent election call has terminated Bill 171 for now.

For those who do not know, Bill 171 proposed legislation which, amongst other things, would have eliminated the right of people to sue their insurance companies for breach of contract in automobile first party benefits claims. In other words, if passed, no one in Ontario could sue their insurer for breaching their obligations under the accident benefits insurance contracts. This has been a right of every contracting party since insurance was invented.

Let me give you an example.

You are injured and off work. Your insurance company owes you $400.00 per week. They refuse to pay. You cannot sue them. Instead you would have to complain to a yet to be established arbitration system run not by the agency that ensures that insurance companies follow the law, but by some other body under the control of the Ministry of the Attorney General.

As it stands, presently you have the option to mediate and arbitrate through the Financial Services Commission of Ontario, or to sue in the courts and have a judge and/or jury decide if you or the insurer is right.

This is a startling change in the law. What startles is not that insurance companies want the change – of course they do. Any change that eliminates the insured’s right to obtain a remedy is always desirable. What startles is that our government representatives – those we elect to protect us as consumers – were so eager to pass this legislation that they remarkably tried to ram it quickly through the provincial parliament before the election and before anyone really had a chance to analyse what it means for consumers.

As I said, the Bill has died. But expect its return and be wary.

More on Scarlett and Belair: Minor Injury Guideline Case Supports Injured Insureds

Tue, 07 May 2013 19:08:28 GMT

The recent case of Scarlett v. Belair Insurance Decision Date: 2013-03-26, Adjudicator: John Wilson, Regulation: 34/10, Decision: Arbitration, Preliminary Issue, FSCO 3965 is the first reported Minor Injury Guideline (MIG) case.

The gist of the decisions stand for the proposition that injured insureds should not be required to take extraordinary steps, or be forced to make leaps and bounds to prove that treatment they require for recovery does not fall within the MIG. In fact it is the opposite that is true. Once insureds, through their care providors, establish with convincing evidence that they will not meet maximum recovery within the MIG limit, the insurer must provide payment for the treatement unless they can prove that the insured is subject to the MIG. It can be said that the applicaiton of the MIG should be considered the exceptiopn rather than the rule.

To quote Arbitrator Wilson:

The insurer is in effect mandated to make an early determination of an insured’s entitlement to treatment beyond the MIG. In essence, because of the necessarily early stage of the claim when the MIG is applied, the determination must be an interim one, one that is open to review as more information becomes available.

What it is not is the “cookie-cutter” application of an expense limit in every case where there is a soft tissue injury present. Such does not respond either to the spirit of the accident benefits system or the policy enunciated in the Guideline of getting treatment to those in need early in the claims process.

While it is quite possible that the majority of claimants can be accommodated within the MIG, averages are misleading when applied to individual cases. Each case merits an open-minded assessment, and an acceptance that some injuries can be complex even when there are soft tissue injuries present amongst the constellation of injuries arising from an accident.

First Minor Injury Giudeline Case Demonstrates Lack of Coverage in Ontario

Mon, 22 Apr 2013 19:21:46 GMT

The recent case of Scarlett v. Belair, FSCO A12-00107, is important more for what it demonstrates in terms of the state of automobile first party insurance benefits in Ontario at the present time, than as an analysis of the application of the Minor Injury Guideline in the legal context.

They key factors that support this contention are:

1. The amount of time it took Mr. Scarlett to obtain a remedy;

2. The total cost of the process; and

3. The approach of the insurer in adjusting the file.

The intention of the insurance industry in convincing their regulator and the Ontario Government to gut first party benefits in Ontario can be and was only to save money. That is clear. Who pockets the savings is another issue and really cannot be dealt with here.

The insurers must have hoped that some of the savings would be direct – less money paid to each applicant. They must also have hoped that the new process would have created a “C change” in the provision of treatment in the Province by reducing the number of service providers or at least limiting their expectations.

The insurance industry clearly believes, as it seemingly always does, that the claims process is swimming with fraud from the applicant, to the service provider and even to the adjusting level. There are examples of each of these.

Many may recall that Bob Rae’s NDP government felt that by reducing the availability of doctors – by graduating smaller numbers of physicians – they would be able to control health care costs; The thought process being that if we limit the number of doctors, and cap what they can charge, we will limit our exposure to the expense of providing health care. However, that thinking does not in any way fight disease – reduce cancer or coronary artery disease – or assist in providing timely and adequate medical care. The net result has been higher doctor’s salaries per capita and much longer wait times. One really cannot comment here about what it has done, if anything to “quality“ of service.

The problem with this line of thinking is that limiting first party benefits did not prevent Mr. Scarlett from being injured. It limited his ability to seek benefits outside of the OHIP system or out of his own pocket. Since he was not entitled to those services through OHIP, his only hope was to seek first party benefits or an advance from the third party insurer. Since OHIP has a very limited ability to provide the services that Mr. Scarlett needed, and since obtaining and advance payment from third party insurers is exceedingly rare, the net result was that Mr. Scarlett had to avail himself of the Dispute resolution process.

The process, designed nearly 25 years ago, was supposed to provide prompt, efficient and inexpensive remediation. The insurers must have known when they went to FSCO four years ago to gut the system that the FSCO process has become anything but prompt, efficient and inexpensive.

It took Mr. Scarlett over 2.5 years to obtain a remedy. That, in and of itself, is an abomination.

It took Mr. Scarlett over 2.5 years to obtain a very modest remedy (opening the door to somewhat more than $3,500.00 in first party benefits.) That makes two abominations.

My guess is the insurer spent many multiples of the benefit claimed to fight Mr. Scarlett. If that is true that is a third abomination.

If the purpose of first party benefits, which in Ontario are very expensive and mandatory to purchase, is to provide medical relief quickly, the case of Scarlett shows that they do not.

There is a web of deception exposed by the Scarlett case –whether intentional or not. We are told that we have the premier first party benefit system in North America, if not the world. This is to convince us that the very expensive premiums we pay to fund those benefits are justified. What is exposed by the Scarlett case is the question, “Why do we pay hundreds of dollars in premiums to get such trifling benefits that can costs us years and many extra thousands of dollars to obtain?”

We have been told that the regulator promised the insurance industry that the changes made in 2010 would reduce their costs significantly – maybe by 80 or 90%. That is like Bob Rae promising us that if we just eliminate the doctors, our health care costs will be reduced.

What we were not told, or what wasn’t made clear was that by reducing, or in fact virtually eliminating the right to obtain first party benefits in a timely and inexpensive way, we are essentially paying something for nothing. If it was not mandatory, what educated consumer would spend six, seven or eight hundred dollars a year to buy $3,500.00 worth of coverage? This question is laid bare in the Scarlett case.

It should be an embarrassment to the regulator that they have permitted this demonstration to have been made. We permit insurers the right to spend our money to eliminate our right to medical treatment. We then make the consumer, the person who the regulator is protecting, take 2.5 years to fight for minimal benefits. Recall, Scarlett is the first case. How many thousands more Scarlett cases are out there?

In Ontario, we were used to premier benefits unlike many other jurisdictions that make no pretence of this. Scarlett should demonstrate to FSCO and to the Ontario Government that it now regulates a sham. There is no way that it is justifiable that someone need pay so much for a policy of insurance, take so much time and spend so much money attempting to remedy their rights to obtain so little a benefit.

In a dream world, insurance companies hire educated and experienced adjusters who look at a file, listen to all the evidence presented and determine what is needed by the client within the limits of the policy. They do not look for “technical” loopholes to ensure that 80 or 90% of their cases by volume result in minimal or no payouts.

It would be better if the consumer were told that they are buying $3,500.00 worth of coverage (not at the current bloated price but at a truly fair price) and if they want more they have to pay more. Scarlett demonstrates quite clearly that consumers in Ontario are paying a lot for very little.

New commander for storied Argyll regiment

Tue, 25 Sep 2012 20:14:19 GMT

From the Hamilton Spectator

The Argyll and Sutherland Highlanders of Canada have a new commander.

Lieutenant-Colonel Lawrence Hatfield took charge of the regiment in a rainy parade celebration at Bayfront Park Sunday, succeeding Lieutenant-Colonel Gary Sexton.

“I’m very privileged today,” Hatfield said. “Our history is time-honoured, written in battle and blood.”

The Argyll and Sutherland Highlanders of Canada are a Hamilton-based army reserve unit within 31 Canadian Brigade Group. Formed in 1903, it has 34 battle honours from the First and Second World Wars.

It is one of the largest army reserve units in Canada with more than 250 soldiers. More than 60 Argylls have been deployed to Afghanistan.

Hatfield himself has more than 22 years in the army reserve service.

He was on active service in Afghanistan from 2006 to 2007, and returned last year on a technical assistance tour to mentor at the Afghan National Army Command School.

“Becoming a C.O. is not just about taking courses or putting in time,” he said. “I’m going to keep our focus on training … relevant training that will be well worth the time spent away from our families.”

Outside of his army responsibilities, Hatfield, a St. John’s, N.L. native, is a personal injury lawyer and partner with the firm Flaherty Sloan and Hatfield. He lives in Ancaster with his wife Shari and their two children.

mhayes@thespec.com

905-526-3214

Social Justice: Superintendent cloaks policy issue as science on catastrophic impairment

Thu, 13 Sep 2012 20:35:24 GMT

Social Justice: Superintendent cloaks policy issue as science on catastrophic impairment

Monday, September 10, 2012 | Written by Alan Shanoff | Law Times

http://www.lawtimesnews.com/201209109304/Commentary/Superintendent-cloaks-policy-issue-as-science-on-catastrophic-impairment

The superintendent’s report on the definition of catastrophic impairment in the statutory accident benefits schedule may seem like a dry topic, but for those suffering injuries in motor vehicle accidents, the difference between having a catastrophic impairment designation and not getting one can be a life-altering distinction.

Of all of the proposals in the superintendent’s report, none is more controversial than the one rejecting the combination of physical and psychiatric impairments to determine catastrophic impairment. The origin of this proposal lies with the final report of the catastrophic impairment expert panel from April 2011.

The panel conceded in its final report that it “did not have the resources to conduct a comprehensive review of the literature to determine whether valid and reliable methods of combining physical and psychological impairment exist.” Thus, it wasn’t surprising that it “did not find sufficient evidence that combined impairment ratings are more clinically meaningful than using separate criteria.”

We’ve come full circle with the superintendent now concluding that “there is no scientific evidence to suggest that combining impairments is a simple additive process.”

It’s also not a surprising conclusion given the constituency of the expert panel. As stated on July 9 by Dr. Harold Becker in his submission to the standing committee on finance and economic affairs, the majority of the expert panel members weren’t experts in catastrophic impairment and the two physiatrists are friendly to insurers.

Becker believes the “failure to acknowledge the coexistence of traumatic brain injury and associated psychiatric impairment . . . is seriously flawed and demonstrates a serious bias against both brain-injured claimants and claimants who develop associated psychiatric reactions resultant from traumatic brain injury.”

Becker’s views deserve the utmost of deference. He was responsible for leading the advisory panel that wrote the catastrophic impairment assessment guidelines for designated assessment centres in 2001. He then served as the medical representative on the advisory panel that wrote the previous report on the definition of catastrophic impairment.

Is there an epidemic of claimants? Hardly. According to the 2011 annual report of the office of the auditor general of Ontario, about one per cent of all accident victims are determined to be catastrophically impaired. That’s less than 700 people a year.

But perhaps there’s a potential flood of additional claimants who would satisfy the definition if we allowed the combination of physical and psychological impairments? That’s not the case.

The current definition of catastrophic impairment has been interpreted to permit the combination of physical and psychological impairments and in last December’s decision in Kusnierz v. Economical Mutual Insurance Co., the Ontario Court of Appeal referred to a concession made by the insurer that “there are only a very few cases where there are permanent physical impairment and permanent psychiatric impairments that are not catastrophic if assessed separately but are catastrophic if assessed together.”

So permit me to be puzzled about the pressing need to disallow combined impairment ratings. It’s also noteworthy that any decision to disallow combined impairment ratings shouldn’t be based on scientific evidence or the lack thereof.

This isn’t a scientific or medical question. It’s a question of policy. The Court of Appeal said it succinctly in Kusnierz when it said the purpose of the catastrophic impairment definition is to ensure that “those with the greatest need for health care are able to recover the expenses of that health care.” If so, why is it necessary to disallow combined impairment ratings?

The composition of the expert panel was problematic at the outset. It made a recommendation without conducting a comprehensive review. The superintendent has followed that recommendation and in turn made an ill-informed recommendation that cloaks a policy issue as a scientific one to the Ontario government. It’s now up to the government to do the right thing and reject it.

Ontario Government Poised to Make Deep Cuts To Auto Insurance Benefits – Again

Tue, 12 Jun 2012 20:56:41 GMT

TORONTO, June 12, 2012 /CNW/ – The Ontario government is about to implement another round of cuts to auto insurance benefits, this time slashing coverage for devastating injuries.

“If the government goes ahead with this, it will hurt a lot of very vulnerable people,” says Nick Gurevich, President of the Alliance of Community Medical and Rehabilitation Providers.

Severely Injured May No Longer Be Protected

Accident victims with severe brain injuries or paralysis, for example, may find they no longer qualify for catastrophic coverage. Those unable to work again, who face years of therapy and life in a wheelchair, may be denied the benefits they need.

Currently, accident victims who are deemed to have suffered a catastrophic (CAT) injury are eligible for basic medical and rehabilitation benefits of up to $1 million. But if the province accepts the recommendations of an expert panel, the CAT threshold will be raised significantly.

This will result in far fewer accident victims qualifying for CAT benefits. Those denied under the proposed new rules will instead be eligible for a maximum of only $50,000 in basic benefits.

“We estimate that the number of cases deemed catastrophic will be reduced by half if these changes are implemented,” says Andrew Murray, President of the Ontario Trial Lawyers Association (OTLA).

Media Availability

Groups concerned about the rights of accident victims have come together to oppose the changes. Along with accident survivors and rehabilitation professionals, they will be available to the media today:

When: Tuesday, June 12, 9:45 a.m.

Where: Media Studio, Legislative Building, Queen’s Park, Toronto

Victims Speak Out

Jaisa Sulit considers herself lucky that she was in a motorcycle accident before any changes to CAT. She was left with a spinal cord injury which qualified for the higher benefits. This funding made two years of intensive therapy possible, and she is now able to walk again.

“But under the proposed new CAT definition, I would not qualify. I would receive only $50,000 in funding, and that would be exhausted in the first several months. I wouldn’t be on the road to having my life back,” Sulit notes.

Dino Le Donne is also thankful that he didn’t have to rely on just $50,000 to see him through. Surviving a horrific crash that left him with broken bones, a collapsed lung and a serious brain injury, he has undergone years of treatment. Today, he is back to work and a productive member of society.

“No way I could have made this recovery if I was excluded from CAT benefits, which would be the case under these new proposals,” he explains. “How can there be any justification for taking away the benefits that help people in desperate need rebuild their lives?”

Brian Patterson, General Manager of the Ontario Safety League (OSL), notes that under the proposed new rules “accident victims who no longer qualify for CAT benefits could find themselves paying hundreds of thousands of dollars in medical, rehabilitation and support costs out of their own pockets.”

Ad Campaign

Ads warning of the impact of the proposed cuts began appearing in newspapers today. Ontarians can go to www.ontariorehaballiance.com/mpp/ to send an email to their MPP expressing their concern.

The “Expert Panel”

The proposed changes are contained in a report by the Catastrophic Impairment Expert Panel, which was appointed by FSCO. It should be noted that half of the panel members have been consultants for the insurance industry association.

About the Alliance of Community Medical and Rehabilitation Providers

The Alliance represents 84 companies and about 3,500 health care providers including nurses, physiotherapists, occupational therapists, speech language pathologists, chiropractors, psychologists, rehabilitation therapists, social workers, personal support workers and case managers. It is these individuals who are the primary providers of healthcare and rehabilitative services to Ontarians who are injured in automobile accidents. Visit www.ontariorehaballiance.com for further information.

About the Ontario Trial Lawyers Association

The Ontario Trial Lawyers Association (OTLA) was formed in 1991, by lawyers acting for victims. Our purpose is to promote access to justice for all Ontarians, preserve and improve the civil justice system, and advocate for the rights of those who have suffered injury and losses as the result of wrongdoing by others. Visit www.otla.com for further information.

About the Ontario Safety League

The Ontario Safety League was formed in 1913 by a group of business and community leaders in response to the increasing threats to public safety brought about by the automobile. The mission was to reduce preventable deaths, injuries and destruction on Ontario’s roads through public education and safety awareness.

For further information:

To arrange interviews or further information, contact:

Niki Kerimova

PR POST

416-777-0368

niki@prpost.ca

John Karapita, Director of Public Affairs

OTLA

cell 289-242-8577

jkarapita@otla.com

Many insurers reject requests – will yours?

Wed, 25 Apr 2012 21:11:21 GMT

http://www.moneyville.ca/article/1167459–auto-insurers-routinely-deny-treatment-plans-therapists-say

By Ellen Roseman | Tue Apr 24 2012 The Toronto Star

Suppose you’re driving your car with three passengers and you hit a deer. No one is hurt, except the animal.

Your insurance company quickly pays $24,000 to cover repairs to your damaged car. It’s happy to protect you from financial harm after an accident.

Now suppose you and your passengers are all injured after hitting the deer. This time, the insurance company is slower to respond.

It may turn down your requests to be repaid for rehabilitation treatments not covered by the health care system (such as physiotherapy or psychological counselling). It may treat you as fakers, exaggerating your injuries.

Related: Why women pay less for insurance

You and your passengers are entitled to maximum benefits of $3,500 each, or $14,000 in total, under Ontario’s minor injury guideline. That’s far less than the $24,000 paid for car repairs.

But you may fight for months — perhaps even years — to get the amount owed to you.

I heard this story at the Hamilton Medical-Legal Society Spring Symposium last weekend. The driver who hit the deer and escaped injury is married to an occupational therapist. He knows how tough it is to get accident benefits if you’re hurt in a collision.

In a speech to the group, I said Ontario was protecting insurers’ profits at the expense of accident victims’ rights to timely treatment. Many professionals agreed with me.

On Sept. 1, 2010, the Liberal government slashed accident benefits, hoping to stop car insurance rates from rising before the election of October 2011. There used to be a maximum limit for $100,000.

Today, 20 per cent of victims get benefits of up to $50,000 for moderate to major injuries. Meanwhile, 70 to 80 per cent of victims with minor injuries have their medical and rehabilitation benefits capped at $3,500.

Even if you want to buy extra insurance coverage for minor injuries, you can’t. You’re stuck with this bare-bones limit, the lowest in Canada.

The government still has a $1 million limit on treatments for those with “catastrophic impairment.” But it will soon bring in a new definition that is expected to make benefits harder to get.

Health professionals talked despairingly about patients losing precious time for recovery when adjusters refused to pay for recommended treatments.

Related: I cut my car insurance by $300 by asking

Lawyers talked about the Financial Services Commission of Ontario’s failure to meet a 60-day time limit to mediate disputes between insurers and clients. Injured people can wait a year or more to be heard.

The courts are starting to recognize victims’ rights. In a recent case (McQueen vs. Echelon), a woman was awarded $25,000 for mental stress after her insurer made 21 denials of benefits over a three-year period.

“Routine and rubber-stamp denials are illegal,” said the plaintiff’s lawyer Lou Ferro, “and insurance companies will be penalized by making them pay aggravated damages on top of the cost of the benefit.”

Last week, an Ontario Legislature committee voted to hold public hearings on car insurance. Something is wrong when 42 per cent of treatment plans are rejected, up from 11 per cent before, says NDP MPP Rosario Marchese.

Many people working in the rehabilitation field think Ontario’s recent insurance reforms have veered too far in the wrong direction.

Let’s hope the three parties — after hearing testimony from accident victims — can come up with suggestions on reversing the unfair treatment.

Ellen Roseman writes about personal finance and consumer issues. You can reach her at eroseman@thestar.ca or www.ellenroseman.com

Steve Sloan of Flaherty Sloan Hatfield Personal Injury Lawyers is the Vice-President of the Hamilton Medical Legal Association

Ontario Court Of Appeal Upholds Judgement in Bicycle Case

Mon, 13 Feb 2012 22:29:17 GMT

The Ontario Court of Appeal has upheld the judgement in Herbert v. The City of Brantford.

The Ontario Court of Appeal decision can be found at http://www.ontariocourts.on.ca/decisions/2012/2012ONCA0098.pdf

Mr. Herbert was injured when he lost control of his bicylce on a pathway owned by the City of Brantford. The pathway was poorly maintained and constructed and the Trial Judge found the City 40% liable for Mr. Herbert’s catastrophic injuries and for the mulit-million dollars in damages that flowed therefrom due to their disregard for Mr. Herbert’s safety. The City appealed.

The trial decision can be found at http://www.hooperlaw.ca/files/Judgment-Muir_v_City_of_Brantford.pdf.

Lawrence Hatfield at Flaherty Sloan Hatfield represented Mr. Herbert from the outset of the claim through trial.

Car injury claims increasingly denied

Wed, 18 Jan 2012 14:20:39 GMT

As reported by the CBC at http://www.cbc.ca/news/canada/toronto/story/2011/12/30/car-insurance-therapy.html

Hamilton speech therapist says car insurance companies are increasingly rejecting her recommended treatments for people who’ve been hurt in accidents.

Deidre Sperry helps her clients recover from brain injuries. Those who have been hurt in car accidents represent 95 per cent of her client base.

Car insurance companies rejected five of Sperry’s recommended treatment plans this year. She said that is more rejections than in her previous 11 years of practice combined.

“I have to be far more adversarial,” she told CBC News. “The treatment plans I’m asking for are only being partially approved when they are approved. There’s more denials and I can’t do the work in the way that I used to be able to do my work.”

Sperry had one client who was hit by a driver who ran a red light. She excpected the man’s insurance company to pay for his entire treatment, but that did not happen.

“The treatment plans that were submitted for his physiotherapy, his occupational therapy and his speech therapy have all been declined,” she said. “He’s a good guy. A wife, two kids in college, paying his taxes.”

“It seems they’re trying to deny more and wear people down so they aren’t going to fight back,” she said.

Rehab patients feel like they are under the gun.

Now, she said, patients already struggling to get through rehab and return to work are made to feel like they are somehow trying to cheat the system.

“They feel like their integrity is being questioned,” she said. “It sets them up to being under the gun and they’ve already got a host of problems to live with.”

Those who decide to fight back are facing a tougher battle than ever before.

All disputed insurance claims must first go to mediation but the average wait time for a hearing has swollen to nearly a year.

Adam Wagman, who represents the Ontario Trial Lawyers Association said the current backlog is “in the tens of thousands”.

“If I were to apply for mediation today, my client might be able to have that mediation heard 10 or 11 months from now,” he said. “By that point in time the physiotherapy treatment that’s been recommended and rejected is almost useless.”

Ontario’s auditor general is calling on the province’s insurance mediator to come up with a plan for reducing the wait time.

Litigation looms over minor injury cases

Mon, 09 Jan 2012 14:28:14 GMT

From the Law Times at http://www.lawtimesnews.com/Focus-On/Litigation-looms-over-minor-injury-cases

Many insurance industry professionals are predicting a deluge of litigation over the many uncertainties associated with the application of the minor injury guidelines.

The lack of consensus over which cases legitimately fall within the criteria cries out for judicial commentary that appears to be years away, which means that even matters that settle are at risk of being reopened when that guidance finally comes.

John Norton of McCall Dawson Osterberg Handler LLP in London, Ont., concludes that the definition of minor injury is going to cause a big debate with significant consequences.

“First, you tell people their entitlement has shrunk from $100,000 to $50,000 and then tell them it’s gone all the way down to $3,500. That’s going to have a huge impact.”

Brian Goldfinger, directing lawyer at Goldfinger Personal Injury Law, believes the definitions under the guidelines are too open to interpretation. He notes that “99.99 per cent of the time, the insurance company will interpret an injury as coming within the [minor injury guidelines].

To get out of it, your doctor needs to provide compelling evidence, which is also open to interpretation. Insurance companies are more often than not going to interpret that as, ‘We need more.’”

Goldfinger’s experience with the few clients who have managed to escape the cap is that it takes a long time and a lot of effort. There’s also concern that there appears to be no way to appeal an insurer’s decision.

“The question is raised as to what people will do when they think it’s unfair,” says Norton. “I believe the effect will be to transfer the claim over to the tort side. If the goal is to cut down on costs and expenses, will that in fact happen? I wonder if there will be any savings at all.”

In the recent experiences of Charles Flaherty of Flaherty Sloan Hatfield in Hamilton, Ont., he has observed that the insurance companies are making maximum use of the guidelines to eliminate their responsibility to pay first-party benefits.

“In four or five years’ time from now, the tort insurers are going to go to the government saying they are getting bankrupted because of the tort costs,” he says. “They are shifting it from one pocket to another.”

According to lawyers, it’s evident that the guidelines don’t give parties enough guidance, leaving both sides exposed to ongoing and costly disputes.

“There is an inconsistency in the application of the guidelines, not just between insurer and insurer, but also between adjuster and adjuster as to what is defined as a minor injury and what constitutes a pre-existing condition that warrants removing someone from the [minor injury guidelines] and the $3,500 hard cap,” says Kadey Schultz, a partner at Hughes Amys LLP.

In addition, there’s also uncertainty over whether the guidelines can apply before policy renewal. A bulletin issued by the Financial Services Commission of Ontario noted they applied as of Sept. 1, 2010.

“There is a lack of consensus on whether that can be valid or legal,” says Schultz. “The [minor injury guideline] is a substantive change to the regulations. A procedural change comes in right away, but in a normal case, a substantive change wouldn’t apply until the policy is renewed because it impacts the rights of the claimant.”

Schultz is concerned about the length of time it will take before there’s any case law to give some guidance on these issues.

“There is such a significant delay in reaching mediation. Even if you had an accident in October last year where an insurer put your client in the [minor injury guideline] and you had applied for mediation to dispute it, it wouldn’t be until right now that you would be receiving an acknowledgment.

Then it has to be scheduled, occur, and a mediator’s report issued. If you then apply for arbitration, that’s another two years, so it will be 2012-2013 before we get any case law. By then, we are in the early stages of the five-year review.”

Schultz is adamant that there needs to be more resources to allow for faster mediations and that when any disputes of this nature get to arbitration, they should receive special attention.

“There is no benefit for the insurer or the injured person for this dispute to linger,” she says.

There has been some movement on the mediation backlog in recent weeks. In addition to the online calendar that will be available in December, two new measures were announced on Sept. 16.

First, they allow for consent failures where parties can show they’ve made their best efforts to settle and there’s no reasonable prospect of resolution. In addition, there will be three months of weekly settlement blitz days, commencing in October, where claimant and insurer representatives have multiple common files.

But Charles Gluckstein of Gluckstein & Associates LLP doesn’t anticipate that disputes related to the guidelines are likely to proceed through a consent failure. “The cap of $3,500 is having a dramatic effect on what legal representatives can do for a claimant,” he says.

“If you allege multiple disabilities or a psychiatric injury that would take them out of the [minor injury guideline], an insurer might be more flexible at mediation and say they have $10,000 to resolve the matter. Why wouldn’t you mediate it when you get the face time with the mediator that you need?”

Even if the cases move more swiftly through mediation, Schultz is concerned that the mediation caseload will turn into an arbitration backlog in a year’s time and that case law will be even further away.

“If there is a decision three or four years from now that guides insurers to conduct themselves differently on the [guidelines], particularly on the issue of the renewal date, they will have to reopen a lot of settlements,” she says.

“The [guideline] is a short time frame and a small amount of money. The insurer won’t have adjusted the claim since the settlement, so there will be no evidence on the merits of entitlement after the [guideline] expired.”

Goldfinger is very worried about the effect on a claimant’s health and other circumstances during the waiting period. “What do you do in the meantime for treatment and rehab? Time is of the essence when it comes to rehabilitation.

When rehabilitation restarts, who knows what coping mechanisms people will have adopted to make ends meet and get by? All the painkillers in the world can’t replace active range-of-motion exercises. But if you have one assessment and physiotherapy three times a week, $3,500 will be gone in a blink of an eye.”

Flaherty, meanwhile, wonders what benefit consumers and insurers will have got from all of the past and proposed changes in insurance law.

“If the insurance companies are successful in reducing payments to $3,500, they will have effectively eliminated all the compromises they got in the late ’80s and moved everything back to the tort system,” he says.

Ontario Court of Appeal Favours Desbiens Approach in Catastrophic Injury Determinations

Mon, 09 Jan 2012 14:25:51 GMT

Accident victim’s rights to expansive first party or “no-fault” benefits in catastrophic cases has been boosted by the recent decision in Kusnierz v. The Economical Mutual Insurance Company, 2010 ONSC 5749 (CanLII). The decision overturns the trial decision.

At trial the judge determined that psychological impairments could not be considered in conjunction with physcal impairments to determine catastrophic impairment. The Court of Appeal has ruled that both areas of injury can be considered and combined to determine whole body impairments. This is consitent with the findings in the case of Desbiens where the trial judge followed an approach now confirmed by the Court of Appeal.

The case is found at http://canlii.ca/en/on/onsc/doc/2010/2010onsc5749/2010onsc5749.html

First party or “no-fault benefits” have recently been gutted by the Provincial Government at the request of the auto insurance industry with the implimentaiton of the Minor Injury Guildines. Entitlements under the Guidelines are arguably the lowest in North America, and on a cost for benefits scale, argueably the most expensive. The insurance industry is presently lobbying the Government hard to further erode benefits by radically altering the definition of catasrophic impairments and reducing the benefits available to catastrophic accident victims.

The Kusnierez decision is rare good news for those who must rely upon insurance in times of great need.

Ontario Auditor General Critical of Insurance Profits in Ontario

Thu, 08 Dec 2011 14:41:03 GMT

The recent Auditor General Report in highly critical of the Ontario Government’s regulation of the cost of insurance in Ontario.

As quoted by the CBC at http://www.cbc.ca/news/business/story/2011/12/05/auditor-general-ontario-spending.html?cmp=rss :

The number of people killed or injured in auto accidents in Ontario fell 25 per cent in a decade, but the government still guarantees insurers a “reasonable rate of return” of 12 per cent. That figure was last adjusted in 1996, when the long-term bond rate it was based on was 10 per cent.

“The long-term bond rate now is about two or three per cent and they’re still being allowed to earn 12 per cent,” McCarter told reporters. “We think that rate should be reviewed, but on the other hand, because of the very high claim costs in Ontario, they’re paying out a lot more claims.”

Finance Minister Dwight Duncan said the Ontario government would look at McCarter’s recommendation to lower the 12 per cent guaranteed rate of return for insurers, but made no promises to cut the rate.

All of this is in spite of the fact that recent amendments to the regultaions under the Insurance Act have drastically reduced accident benefits for innocent accident victims in Ontario. In other words, drivers in Ontario are paying higher premiums for less covereage while the government aims to ensure that the industry makes a return of 12%. The long term bond rate was 2.6% on avereage within the last few days of this post. Innocent accident victims suffering significant personal injury are restrcited in how they can invest their money under structured settlements. The present return for personal injury victims is around 3%. Something is not right.

Ontario Superior Court permits Claim against Police to Proceed

Thu, 08 Dec 2011 14:34:42 GMT

In an action against the Hamilton Police in negligence for failing to arrest Hamilton’s “Most Wanted Criminal” Corey Rogers, the Ontario Superior Court of Justice has dismissed a motion by the police which, if successful, would have stopped the lawsuit. By virtue of the Ruling the plaintiffs are permitted to proceed. The case is under appeal. The plaintiffs are represented by Charles Flaherty and Tara Sciara of Flaherty Sloan Hatfield.

See: http://www.canlii.org/en/on/onsc/doc/2011/2011onsc5312/2011onsc5312.html

For more information on the details of the crime see: http://www.oacas.org/news/09/april/09roger.pdf

No More Over-Arching Interpretation Principles Favouring Insurers

Tue, 15 Nov 2011 14:42:59 GMT

An insurer is required to defend a claim where the facts alleged in the pleadings, if proven to be true, would require the insurer to indemnify the insured for the claim. It is irrelevant whether the allegations in the pleadings can be proven in evidence. What is required is the mere possibility that a claim falls within the insurance policy. Where it is clear that the claim falls outside the policy, either because it does not come within the initial grant of coverage or is excluded by an exclusion clause, there will be no duty to defend. In examining the pleadings to determine whether the claims fall within the scope of coverage, what is determinative is the true nature or substance of the claim, not the labels selected by the plaintiff.

See: Progressive Homes Ltd. v. Lombard General http://www.canlii.org/en/ca/scc/doc/2010/2010scc33/2010scc33.html

Ontario Court Of Appeal Upholds Damages for Mental Distress Against Motor Vehicle Insurer

Mon, 07 Nov 2011 14:44:54 GMT

The Ontario Court of Appeal has upheld a claim for damages of mental distress caused by the failure of Echelon Insurance to properly adjust a claim arising from a motor vehicle collision .

“People purchase motor vehicle liability policies to protect themselves from financial and emotional stress and insecurity. An object of such contracts is to secure a psychological benefit that brought the prospect of mental distress upon breach within the reasonable contemplation of the parties at the time the contract was made. As an insured person entitled to call on the policy, Ms. McQueen was entitled to that peace of mind and to damages when she suffered mental distress on breach.

See http://www.canlii.org/eliisa/highlight.do?text=mcqueen+echelon&language=en&searchTitle=Search+all+CanLII+Databases&path=/en/on/onca/doc/2011/2011onca649/2011onca649.html

For commentary see: http://www.lawtimesnews.com/Focus-On/Claim-for-mental-distress-puts-pressure-on-insurance-companies

Accident Benefits Far from Generous

Mon, 31 Oct 2011 13:46:33 GMT

http://m.torontosun.com/2011/10/28/generous-accident-benefits

Put auto insurers under microscope

Tue, 23 Aug 2011 13:54:15 GMT

By Alan Shanoff ,Toronto Sun

http://www.torontosun.com/2011/08/18/put-auto-insurers-under-microscope

Being injured in a car accident isn’t something to which anyone looks forward.

Aside from the pain and suffering from the injuries, there’s the potential loss of earnings.

But, no worries, we have no-fault income replacement benefits in Ontario.

And, of course, an insurance company would never act in anything other than good faith in administering those benefits. Or would they?

Let’s look at the case of Everliston Cowans, who was injured in April 2007.

Cowans earned about $50,000 in the year prior to his accident. Under our generous, no-fault benefits, this was reduced by almost one-half for the first two years after the accident.

At that time his insurance company, Motors Insurance Corporation, terminated his income replacement payments, even though Cowans continued to suffer from chronic pain and was limited in his ability to work.

The insurer said he no longer qualified for the income replacement.

But according to Financial Services Commission of Ontario arbitrator John Wilson, in a decision released late last year, it reached this conclusion based on a “patently flawed assessment process.” How did it happen?

Motors retained Health Impact Multidisciplinary Centres (HIMC) to obtain assessment reports on Cowans’ ability to return to work.

HIMC then arranged for assessments by a psychiatrist, a physiatrist, a kineticist and a labour market analyst.

Motors cancelled Cowans’ income replacement based on the reports, without giving them “close scrutiny” or analyzing their “conclusions in a critical manner.”

Worse, the main report relied on was critically flawed and at the time Motors made its determination, it had “credible information” casting doubt on its recommendations.

Cowans eventually had his income benefits reinstated so can we rest easy and move on?

No. It isn’t that simple. You see, some of the evidence at the arbitration is so astounding it cries out for a public inquiry.

The psychiatrist who was part of the assessment team testified. His prime occupation was conducting psychiatric assessments, mainly for car insurers. He testified his assessment of Cowans was one of up to 45 to 50 he might conduct in a month. His projected income from assessments was “in the range of some $600,000 per year.”

The arbitrator referred to the psychiatrist’s “obvious dependence on the insurer’s goodwill for his lucrative assessment business” and concluded that whether the doctor was “biased or prejudiced or not, I find it tests credulity to believe that an assessment mill such as described … could ever generate meaningful results.”

Given the number of assessments per week, the time permitted to review voluminous documentation, assess the insured and write a report would have been “at most four hours from start to finish.”

The Ontario government has set up a task force to investigate car insurance fraud. No doubt some people engage in insurance fraud. We’ve all read about staged accidents as a prime example of such fraud, although how prevalent they are remains to be seen.

I’m not saying the practices of assessment mills are equivalent to fraud — they aren’t.

But shouldn’t we have a task force to inquire into questionable insurance company practices? How many use the services of assessment mills? How many insureds have had their benefits wrongly cut off due to assessments conducted by assessment mills or experts beholden to insurance companies?

Remember, the evidence in this one case by one doctor is that he alone conducted up to 45 to 50 assessments per month. How many doctors or experts have similar practices or depend on an insurer’s goodwill for their lucrative business?

Even if some, or many, of their reports are accurate, there’s certainly an appearance of a conflict and a perception of a lack of fairness.

How much money do insurers spend/waste in their attempts to cut off their insureds’ benefits?

It would be instructive to know how much Motors paid Health Impact Multidisciplinary Centres for the four experts’ reports.

It’s time we put the car insurance industry under a microscope.

Kusnierz raises ire of plaintiffs’ bar

Mon, 10 Jan 2011 15:11:30 GMT

Ruling says cumulative injuries may not equal catastrophic impairment

By Judy Van Rhijn | The Law Times | Publication Date: Monday, 10 January 2011

The liberal approach adopted by courts and tribunals towards combining impairments when assessing whether an injury is catastrophic received a nip and a tuck in a recent decision.

In the case, Kusnierz v. The Economical Mutual Insurance Co., the plaintiff’s attempt to combine percentage ratings for physical and mental or behavioural disorders fell afoul of a stricter interpretation of the guidelines than has been the norm.

The decision is causing consternation in the plaintiffs’ bar as it condemns the practice of combining different impairments to reach the 55-per-cent threshold for a finding of catastrophic impairment under the statutory accident benefits schedule.

The case, which is now under appeal, boils down to a philosophical disagreement over the purpose of insurance in Ontario.

The plaintiff, Robert Kusnierz, suffered the amputation of his left leg below the knee after a Christmas Eve automobile accident in 2001. He has since suffered extreme difficulty in finding a suitable prosthetic due to the tendency of his stump to develop cysts.

The court found Kusnierz to be a credible and honest witness who deserved its sympathy, yet Superior Court Justice Peter Lauwers found this impairment totalled only 50 per cent and refused his application.

It was common ground that if Kusnierz’ physical injuries were combined with his mental and behavioural impairments, his rating would exceed 55 per cent and he would be deemed to be catastrophically impaired.

Lawyers, however, concluded that such a combination isn’t permissible. In essence, he ruled that the guidelines don’t permit mental and behavioural disorders to be assessed in percentage terms and combined for the purpose of determining whole-person impairment; that the structure of the benefits schedule reinforces the bright-line demarcation between mental and behavioural disorders and other impairments; and that this interpretation is consistent with the purpose of the specific provisions of provincial legislation. As a result, he found Kusnierz to have an impairment of 50 per cent.

Harry Steinmetz of Fireman Steinmetz in Toronto has retained Paul Pape to conduct the appeal for Kusnierz. “I’ve spoken to hundreds of people about it,” says Steinmetz. “There is lots of interest. One of the main arguments under discussion will be the issue of statutory interpretation.”

Steinmetz is very confident of the strength of his position and notes there’s a lot of legal precedent that favours Kusnierz on appeal, including Desbiens v. Mordini. “Justice Lauwers was not a supporter of the decision in Desbiens unlike his colleagues and all the arbitrators.”

Lee Samis, a lawyer with Samis & Co. who represents the insurance company, agrees the appeal will turn on how to interpret the regulations. “There are cases that have a different outcome. The main one is Desbiens, but there the issue of interpretation was attacked in obiter. Other decisions don’t have the fulsome analysis that’s in Kusnierz.”

In examining whether his decision to refuse a combined total produced a just result for Kusnierz, Lauwers considered the purpose of the legislation as follows: “Bill 59 aimed at reducing no-fault benefits to most people with the savings going to stabilize insurance premiums, while creating a narrow exception for people who were catastrophically impaired.

The introduction of subjective mental and behavioural factors on such a broad basis would undermine the objective approach to the assessment of impairments that contribute to the calculation of [whole-person impairment] required by the guides, and through them, by the [benefits schedule].”

He also referred to the “highly structured framework that is quite precise and mathematical” prescribed by the benefits schedule.

Lawyers agreed with Steinmetz’ submission that an inability to combine mental and behavioural disorders with other impairments would clearly create a kind of gap in eligibility for catastrophic impairment benefits. While he expressed the view that this would be “unjust,” he felt unable to depart from what he saw as the more natural way to interpret the regulations.

“The result of a bright-line threshold like 55-per-cent [whole-person impairment] is that some people will meet it handily, others will fall far short, and some will come close. For those who come close, there is no discretion in the court, out of sympathy, to push the plaintiff over the line.”

Charles Flaherty of Flaherty Sloan Hatfield in Hamilton, Ont., strongly disagrees with the decision. “This judge cites that the purpose of the legislation is to keep insurance rates in check, but this is consumer protection legislation,” he says.

“Where there is any ambiguity and uncertainty, it’s supposed to be interpreted in favour of the insured. The courts were doing their job. Desbiens said, ‘Look at the whole body, mind, and soul.’ It’s silly not to.”

In particular, Flaherty objects to insurers’ attempts to undermine the two-tier definition of injuries. “Insurers asked for this in 1989 — that injuries be broken down into regular injuries and catastrophic injuries.

They said there had to be a line. They made the line. Now the insurance companies fight, squirm, and wriggle to get out of it. What’s the point of insurance? To repair us in situations of need.”

Flaherty notes that under the new insurance reforms, Kusnierz would be covered since the loss of a single limb now counts as a catastrophic injury.

“Before, it was not automatically catastrophic. He had to wait and see how he did and how he managed to accommodate his loss. The doctors say he can’t. It’s not about insurance fraud. These are people with horrible injuries. They can’t get up in the morning without help.”

Flaherty believes the real battle isn’t about rights but profits. “One prosthetic can cost $75,000 to $80,000. What if he needs five over 15 to 20 years? Who’s going to pay for it?

This case says you’d better go to the government or your family or some other insurance company but not to the auto insurer. Why buy expensive insurance, as the government says you must, if you’re not going to be covered?”

Clinical Notes and Records

Mon, 10 Jan 2011 15:00:36 GMT

In any lawsuit in Ontario, be it criminal, civil, family or personal injury/insurance, the Rules of Court mandate that parties exchange relevant documentation that they have, or information pertaining to documentation or other relevant information that they know to exist, be it in their possession or not.

Most often, the request for documentary information originates with a third party.

The purpose of timely exchange of information is to facilitate a resolution of the dispute between the parties.

The Rules of Court are designed to facilitate settlement and avoid court.

As in most Court mandated processes, the Court is the ultimate arbiter of what is relevant, and what is fair compensation for the burden of being forced to provide information in proceedings to which you are not a party.

Physicians must be compensated for the provision of notes and records in a fair way.

From a legal perspective, the principal rules for reimbursement for providing notes and records are:

Fees are for photocopying and staff time only

Fees for review of records will only be paid if the review of records was specifically requested

If records are illegible, a fee will be provided for the “transcription” of the records but that fee should be negotiated in advance

When you are asked to provide a copy of your patient’s notes and records, it is important that you provide all of your notes and records. However, as often as not, your patient’s lawyer will put a time limit as to how far back in time the records should go (eg. 3 – 5 years preceding the incident in question up to the date of request).

As with most things, good and accurate communication avoids misunderstanding. If you are not clear as to what exactly is being requested of you, you can always ask for clarification. At out law firm, we are pleased to respond to individual physician’s requests for explanations.

Keep in mind that in the end, if the third party refuses to pay for the service, or if the Court will not enforce the request of the physician for payment from the third party, the patient will be responsible for the fee. If the fee is exorbitant or not commensurate with the request, the patient may complain.

At out firm, if the request for notes and records emanates from our office, we pay upon receipt of the records, or in advance if requested. If the request is made by an opposing party, we will pay for the records as soon as that party makes payment.

2010 Accident Benefits Changes – A Legal Perspective

Mon, 22 Nov 2010 15:15:53 GMT

[This Paper was originally presented at the THE 24th ANNUAL JOINT INSURANCE SEMINAR presented by: The Hamilton Law Association and The Ontario Insurance Adjusters’ Association (Hamilton Chapter)]

SABS CHANGES – LEGAL PERSPECTIVE [1]

By Tara Sciara

For months legal professionals, insurance adjusters, treatment providers, and to some extent, knowledgeable consumers have feared the effects of the new changes to automobile insurance legislation in Ontario released by the Ministry of Finance. The changes to both the statutory accident benefits regime and tort litigation arising from motor vehicle collisions were announced following the Ministry’s Five Year Review of Auto Insurance and most became effective September 1, 2010. For insured persons with automobile policy renewals after September 1, 2010, changes to substantive accident benefits entitlement will take place on the date of renewal.

According to the Ontario government, the legislative intent of the changes to the first-party accident benefits system was to simplify the system, reduce extraordinary assessment and administrative expenses, reduce benefit entitlement to non-catastrophic claimants and introduce a new category of claimants who suffer “minor injuries”.

This paper will focus on some of the significant changes to statutory accident benefits coverage arising out of Ontario Regulation 34/10 [2] (hereinafter, the Regulation), how those changes are likely to affect those practicing in this area, and will outline strategies that may be adopted by counsel in order to serve their clients. For ease of reference, a chart outlining the statutory accident benefits changes is annexed to this paper.

Transition Provisions

As a general rule, substantive provisions under the new SABS apply only to motor vehicle accidents occurring after September 1, 2010 (new accidents) and procedural provisions apply to new accidents and accidents occurring prior to September 1, 2010 (old accidents). The transitional provisions are set out in s.68 of the Regulation:

68. (1) Despite any other provision of this Regulation and unless otherwise agreed in writing by the named insured and the insurer, subsection (2) applies to every motor vehicle liability policy that is in effect on September 1, 2010 until the earlier of,

(a) the first expiry date under the motor vehicle liability policy; and

(b) the day on which the motor vehicle liability policy is terminated by the insurer or the insured, if the policy is terminated before the day referred to in clause (a).

(2) The following benefits are deemed to be included in the motor vehicle liability policy and are applicable to an insured person in respect of the motor vehicle liability policy:

1. The optional caregiver, housekeeping and home maintenance benefit referred to in paragraph 2 of subsection 28 (1).

2. The optional medical and rehabilitation benefit referred to in paragraph 3 of subsection 28 (1).

3. The optional attendant care benefit referred to in paragraph 4 of subsection 28 (1).

4. All optional benefits referred to in subsection 27 (1) or section 28 or 29 of the Old Regulation that were purchased and still in effect on September 1, 2010.

The Financial Services Commission of Ontario released a Bulletin highlighting the transition rules pertaining to the New Regulation, which is annexed at Schedule “B”. According to the Bulletin, the following rules apply:

The Old SABS continue to govern the calculation of benefit entitlement amounts for old accidents eg. IRB calculations, coverage limits, availability of caregiver and housekeeping benefits, attendant care benefit hourly rates, definition of “incurred expenses” does not apply

The New SABS will govern most claims processing and most calculation of amounts payable to establish benefit entitlement for all accidents eg. use of new claims forms, who can prepare an OCF-19, who can prepare a Form 1, interest on amounts that become overdue on or after September 1, 2010, fees invoiced on or after September 1, 2010, no re-election between IRB’s, Caregiver and Non-earner benefits, no rebuttal assessments, use of IE exams is discretionary

There are exceptions to the above rules concerning the applicability of the New SABS to claims processing for old accidents eg. Interest on amounts overdue before September 1, 2010 will accrue at old SABS rate, insurer delivery of benefit statements will not apply to old accidents, cost of examinations and assessments for old accidents will not be included in medical/rehabilitation coverage limits, in-home assessments for minor injuries will continue to be permitted for old accidents.

Medical and Rehabilitation Benefits

One of the most significant changes that will affect insured persons who purchase or renew a policy after September 1, 2010 will be the reduction of the medical and rehabilitation limits in non-catastrophic cases from $100,000 to $50,000 [3]. This reduction is even more significant given that “all fees and expenses for conducting assessments and examinations and preparing reports in connection with any benefits” are to be included in the $50,000 cap for non-catastrophic cases, but also in the $1,000,000 limits still available in catastrophic cases [4]. Costs associated with insurer examinations under s.44 and assessments conducted to determine the quantum of income replacement benefits will not be included in the medical and rehabilitation capped amount. The reduced medical and rehabilitation amount in non-catastrophic cases averages $5000 per year for the 10 years available under the policy.

The new SABS provide for the purchase of optional benefits which would increase the benefit levels available. However, although options existed for insured persons pre-September 1, 2010 to purchase elevated benefits, past experience has shown that the majority of consumers were either not provided with the option to purchase these elevated benefits from their brokers/agents or declined to do so.

The government has tried to justify the reduction to consumers by indicating that it will provide “more choice”. Insurance companies are advertising that consumers will be able to tailor their policies to suit their individual needs. Critics of the reduction of benefit limits claim that consumers are paying more for less. In other words, to get the coverage an insured person enjoyed under the old SABS his/her premiums would increase.

Further, the choice of added protection is only available to those who have a policy of automobile insurance. Pedestrians, passengers, cyclists and public transit users without their own automobile insurance policies are stuck with the reduced level of benefits. Where is the choice for these injured parties?

Plaintiffs’ counsel may now have to obtain information at initial client meetings about when policies were purchased/renewed, and whether or not the client’s broker/agent provided sufficient explanation of the optional benefits available. A broker/agent who does not explain the implications of failing to purchase optional medical and rehabilitation coverage may be exposed to liability.

Additionally, it may not be a bad idea to send a letter to existing motor vehicle accident clients who may have policies of insurance coming up for renewal or who may have expressed an interest in changing insurers explaining that there have been changes implemented that directly affect the amount of benefits available to them under their auto policies and inviting them to contact your firm to discuss the changes.

Plaintiffs’ counsel will also have to work together with their clients and the rehabilitation community to try to maximize the available benefits. The focus will have to be balancing the need for assessments with the need for services and treatment.

The cost of assessments has been limited to $2000.00 both for those assessments commissioned on behalf of the injured party and those requested by the insurer [5]. The cap applies to fees and expense for conducting any one assessment or examination and for preparing reports in connection with that assessment. Insurers no longer have to pay fees for preparing a future care plan, a life care plan or for any assessment conducted in connection with the preparation of this plan [6]. While, in theory, this may have been meant to keep the costs of assessments down so the insured is not using up the $50,000 limit, in reality, it is effectively reducing the type of assessments that will be funded by the insurer. Historically, neuropsychological examinations and vocational assessments, for instance, cost well over $2000.00 to conduct. Under the new SABS, only $2000.00 of the total cost of these assessments will be funded, assuming they are considered reasonable and necessary. That leaves the insured having to come up with the remainder of the cost for the assessment.

The assessment cap also creates an uneven playing field between insurers and insured persons. While the cap applies to IE assessments, the number of assessments an insurer can conduct is not limited. The insured has a $50,000 limit on treatment and assessments which effectively puts a limit on the number of assessments available to an insured. There is no such limit for the insurer.

The new SABS make the use of an IE exam discretionary on the insurer [7]. However, the insurer now has to provide “medical and any other reasons” why the insurer does not agree to fund the proposed treatment. This may be difficult without the benefit of an IE assessment. Where IE assessments are not requested, the denial letters/OCF 9’s must be scrutinized to ensure proper medical reasons were provided for the denial. Insurers will likely continue to use IE assessments, especially since the ability for an insured to obtain a rebuttal has been eliminated.

If IE’s continue to be utilized by insurers, the result is that an insurer will have a report to support their denial and the insured is effectively left without a means of medically disputing the denial other than the oral evidence of the health practitioner. Should the insured wish to obtain a rebuttal, the insurer does not have to pay for it and it is an expense that will fall on the insured.

So where does this leave the insured? The following are some suggestions to assist with ensuring the insured makes the most out of the $50,000 limits and with dealing with the $2000 assessment cost cap and elimination of rebuttal reports:

Regarding the $50,000 limit for medical and rehabilitation limit, it will be important to work with the treatment providers to ensure that unnecessary treatment is eliminated and the focus is on providing a team approach to treatment, where available.

Attempt to make deferred payment agreements with service providers. This may only work in cases with strong tort claims, as there is a strong chance that the money will be recuperated in the tort claim.

Insurers are now obligated to submit benefit statements including the amount paid to the date of the statement, the additional amount remaining and the amount paid in respect of IE examinations. These have to be delivered at least once a year in CAT cases and at least once every two months in all other cases [8]. It will be important to ensure that these statements are being delivered so that the insured is well aware of the benefits remaining as a plan for future treatment may have to be amended based on the amounts remaining.

Plaintiff’s counsel will have to canvas tort adjusters/counsel for advance payments for treatment. Ultimately, the money will be coming from the tortfeasor’s policy once the $50,000 is exhausted. This may require obtaining a future care cost assessment early on to illustrate exposure on the tort insurer. The argument can be made that where an advance is not granted, the insured does not have the funding to continue with treatment, which may result in deterioration of the insured’s condition and more money being paid out on the tort claim in the long run. If an advance is granted, the insured will have to account for the money and show that it was used for treatment. Counsel should prepare a chart or obtain receipts from the insured person.

Obtain medical legal reports to address both denied benefits (specifically asking the expert to comment on reasonableness and necessity of treatment/assessments) and tort issues. This option allows the assessment cost to be recouped as a disbursement.

To get around the $2000 assessment limit, treatment providers may consider submitting multiple OCF-18’s totaling $2000 each to cover the full cost of the assessments. For instance, where it would cost $6000 for a neuropsychological examination, the assessor may submit an OCF-18 for the actual examination, for the testing, and then for preparation of the report. Multidisciplinary assessments for determination of CAT or IRB’s can also be broken down such that each assessor submits his/her own OCF-18 for $2000 or less. The problem with submitting an OCF-18 for these types of assessments is that it will significantly reduce the $50,000 medical and rehabilitation limit. It may make more sense to try to fund these assessments by other means, where possible.

Plaintiffs’ counsel can agree to fund the balance of the assessment costs where only $2000 is approved, or where the assessment is not approved but would be helpful. Where the full assessment has been denied, the issue can eventually be mediated and the insured will have the benefit of actually having the report and having actually incurred the expense, thus attracting interest.

In potential CAT cases, plaintiffs’ counsel may want to consider funding the cost of a full CAT assessment. Assuming an OCF-18 for the assessment will be denied, or will only be partially funded (considering the limit of $2000 per assessment), counsel can approach the tort insurer to assist with payment of the assessment. Where and insured is found to be CAT, this will reduce the exposure on the tortfeasor.

For those without a tort claim, the caps and restrictions will definitely have a negative impact. Without another pocket to pick there will be more litigation, from which disbursements will be recovered. However, many individuals relying only on the first party system, will most likely be unrepresented and will be left to their own devices. Plaintiffs’ counsel may want to consider the claims of these individuals as there may be broker negligence if optional insurance was not purchased.

Minor Injury Guideline (MIG)

A significant addition to the SABS is a new category of injury referred to as a “minor injury”. An injured person suffering a “minor injury” will only be entitled to $3,500 in medical and rehabilitation benefits, inclusive of assessment costs [9]. In addition, a person suffering such an injury will not have access to attendant care benefits, which would otherwise be payable to individuals sustaining a non-catastrophic injury [10]. Nor will an insured person suffering a “minor injury” be entitled to an in-home assessment or examination, such as an in-home occupational therapy assessment [11].

To trigger this section of the Regulation, the impairment has to be “predominantly a minor injury”. There is no indication how the word “predominantly” will be defined. However, as worded, the section may apply to those individuals who have a minor injury as well as additional “non-minor injuries”, so long as the minor injury is the predominant injury. Whether or not this is a subjective test is yet to be determined. Will medical proof be required to establish predominance? Who makes the call as to whether the injury is predominant. It may be that the “non-minor injuries” will always be more predominant to the insured.

A minor injury is defined by the Regulation as follows:

“minor injury” means one or more of a sprain, strain, whiplash associated disorder, contusion, abrasion, laceration or subluxation and includes any clinically associated sequelae to such an injury.

Several of the types of injuries specified as a minor injury are also defined within the Regulation:

“sprain” means an injury to one or more tendons or ligaments or to one or more of each, including a partial but not a complete tear.

“strain” means an injury to one or more muscles, including a partial but not a complete tear.

“subluxation” means a partial but not a complete dislocation of a joint.

“whiplash associated disorder” means a whiplash injury that,

(a) Does not exhibit objective, demonstrable, definable and clinically relevant neurological signs, and

(b) Does not exhibit a fracture in or dislocation of the spine.

Based on the above definitions, included within the category of “minor injuries” would be a partial tear to the anterior cruciate ligament (ACL) or a partial rotator cuff tear. These impairments would only be subject to the $3500 cap. Further, the definition indicates that “any clinically associated sequelae” would be treated as a “minor injury”. It is yet to be determined what sequelae will be included. For instance, is chronic pain a “clinically associated sequelae” of a partial rotator cuff tear or whiplash associated disorder? The insured person may have to obtain a report that explains that chronic pain is not a “clinically associated sequelae”.

The Regulation does provide for insured persons who have pre-existing medical conditions. This section could serve as a way to avoid clients falling under the restrictive definition of a minor injury. Section 18(2) states that:

(2) Despite subsection (1), the $3,500 limit in that subsection does not apply to an insured person if his or her health practitioner determines and provides compelling evidence that the insured person has a pre-existing medical condition that will prevent the insured person from achieving maximal recovery from the minor injury if the insured person is subject to the $3,500 limit or is limited to the goods and services authorized under the Minor Injury Guideline.

The keys to this section are that the evidence must come from a health practitioner, the evidence must be compelling and the pre-existing condition must prevent achievement of maximal recovery. A health practitioner can include a physician, chiropractor, dentist, occupational therapist, optometrist, psychologist, physiotherapist, registered nurse or a speech language pathologist. However, what will be considered “compelling evidence” will ultimately be determined by arbitrators and the courts. It is likely that the intent and expectation of insurers is that the majority of pre-existing medical conditions will not exclude a person’s impairment from the “minor injury” category. Plaintiffs’ counsel will have to be careful not to rely too heavily on the pre-existing medical condition for the purposes of more access to medical and rehabilitation benefits as this may jeopardize the tort claim.

The Superintendent of Insurance has created a Guideline for dealing with this new category of injury. Guideline No. 02/10, published in June 2010, provides a treatment framework in respect of one or more minor injuries and sets out the goods and services that will be paid for by the insurer without insurer approval if provided to an insured person who has sustained a minor injury.

The treatment framework outlines the type of treatment that should be provided from the initial visit with the health practitioner to discharge and the amounts that will be funded for each phase. The Guideline provides for twelve (12) weeks of treatment in three (3) blocks. The first block includes the first four weeks of treatment beginning immediately after the initial visit and the approved fee for this period is $775.00 for treatment or $200.00 for monitoring, but not both. Block two (2) is the second four weeks of treatment and the insurer will fund $500.00 for this block, or $200.00 for monitoring services. For the final block, the last four weeks of treatment, the insurer will only pay $225.00 for treatment or $200.00 for monitoring.

The Guideline provides for a limited amount of supplementary goods and services in addition to the treatment funding, such as assistive devices and supportive interventions. The maximum amount allotted is $400.00 without approval of the insurer.

If after the above 12 week treatment phase, the insured has not reached maximal medical recovery, the health practitioner can submit an OCF-18 indicating the treatment that is recommended outside the Guideline. The insurer must treat this as any other OCF-18 in terms of response time and ramifications for failure to respond. As an aside, when an OCF-18 is submitted in any circumstance and the insurer fails to give proper notice under s.25(8), he or she not only has to pay for the goods and services outlined in the OCF-18 until proper notice is given, but will be prohibited from taking the position that the insured person has a “minor injury” [12].

Caregiver, Housekeeping and Attendant Care Benefits

Another blow to insured persons is their inability to claim caregiver and housekeeping benefits for non-catastrophic injuries, unless optional benefits were purchased. Under the basic policy, these benefits are now only available for those insured persons suffering a catastrophic impairment. The amount of benefits available remains the same, that is, a maximum of $100.00 per week for housekeeping benefits and a maximum of $250.00 per week for the first person in need of care and $50.00 for each additional person in need of care for caregiver benefits.

As before, Plaintiffs’ counsel can add these expenses to the tort claim as out-of-pocket expenses. Clients will have to be more diligent about getting invoices from service providers or enter into service arrangements with deferred payment plans. Plaintiffs’ counsel will no longer have to face the argument from tort insurers that they get a credit for the full $10,400 that was available under the SABS even if the insured was not provided the full benefit. Counsel may also no longer be limited to the $100.00 per week for housekeeping claims when seeking market rates in the tort action.

Like the medical and rehabilitation expenses, the attendant care expenses have also been reduced. Where optional benefits have not been purchased, the benefits available have been reduced from $72,000 to $36,000 in non-catastrophic cases [13]. What is interesting to note is that although the benefits are still available for only two years following a collision, the insured can still claim the maximum $3000 per month. If the insured claims the maximum of $3,000 per month, the available benefits will be exhausted after only one (1) year.

There is no real way to get around this, save and except for asking for an advance from the tort insurers. It may be that Plaintiffs’ counsel will have to identify potential catastrophic cases using (f) and (g) earlier and most definitely before the two year mark. The rules are still the same regarding applications for catastrophic impairment that are submitted prior to the two year mark, which is permissible where a physician, or a physician or neuropsychologist in cases of brain impairment, states in writing that the insured person’s condition is unlikely to cease to be a catastrophic impairment [14]. In these cases the insurer is still obligated to pay the elevated rate of $6,000 until a determination is made [15]. However, as always, clients will have to be prepared to pay back the money if they are not determined to be catastrophic.

Another change related to attendant care benefits is that the attendant care assessments can only be performed by nurses or occupational therapists that have been trained to use the Form [16].

“Incurred Expenses”

Under the old SABS the issue of “incurred expenses” always seemed to be a bone of contention for insurers. Ultimately, family members and friends were entitled to be compensated for their assistance with housekeeping, care giving and/or attendant care. Further, if a benefit was found to be reasonable and necessary, it was “incurred”, even if there was merely a promise to pay and the insured had not actually paid for the service.

Regulation 34/10 has tightened up this definition in such a way that will impact on entitlement to housekeeping, care giving and attendant care benefits for new accidents. The definition will have a specific impact on friends and family members providing services to the injured party.

The new definition is as follows:

3(7)(e) subject to subsection (8), an expense in respect of goods or services referred to in this Regulation is not incurred by an insured person unless,

(i) the insured person has received the goods or services to which the expense relates,

(ii) the insured person has paid the expense, has promised to pay the expense or is otherwise legally obligated to pay the expense, and

(iii) the person who provided the goods or services,

(A) did so in the course of the employment, occupation or profession in which he or she would ordinarily have been engaged, but for the accident, or

(B) sustained an economic loss as a result of providing the goods or services to the insured person [17].

Injured parties are now going to be required to prove that either the person providing the services was in the business of providing housekeeping, care giving or attendant care services prior to the collision, or sustained an economic loss as a result of having to assist the injured party with housekeeping or caregiving, in the event of a catastrophic impairment, or attendant care in cases of catastrophic or non-catastrophic impairment. It is interesting to note, however, that the requirement that the person providing services be in the course of the employment, occupation or profession he or she would ordinarily have been engaged in but for the accident appears to contradict s.3(7)(c) which states that an aide or attendant for a person includes a family member or friend who acts as a person’s aide or attendant, even if the family member or friend does not possess any special qualifications.

Family members and friends will, in most cases, now have to establish economic loss as a result of providing the care or services. This could have a significant impact on cases where the care provider was unemployed at the time of the accident, residing with the injured party and is the person best suited to provide care to the injured party, for instance, a retired man who provides care for his injured spouse following a collision. The injured spouse may have to rely on a professional service provider who will charge higher rates that may not be funded by the insurer as they are outside the amounts allotted by the SABS.

Many family members or friends can carry out the housekeeping, caregiving or attendant care services while maintaining their pre-accident employment. How do they establish economic losses? Perhaps travel/transportation expenses if they live outside the insured party’s residence, or purchasing supplies to assist with the services, such as cleaning supplies. Those who may have to forego an opportunity to enter the workforce to care for an injured family member or friend may be able to establish an economic loss. The retired individual could argue that he or she lost income as he or she would have earned income from handyman services. The definition does not say “direct” economic loss, so arguably the economic loss could be indirect. How far the courts or arbitrators will take this is yet to be seen.

A reality in motor vehicle cases is that a spouse or family member will provide housekeeping services, caregiving services or attendant care to bring more cash flow into the home, as often the injured party is no longer able to work and his or her income has been reduced. The family relies on this money to keep up with bill payments, etc. Cash flow issues may become more prominent.

Of note is that the need to prove that an expense has been “incurred” does not apply where the insurer delayed or unreasonably withheld the benefit and entitlement is determined later by the Court or Arbitrator. The expense will be deemed to have been incurred in these situations [18]. This section will likely prevent unreasonable denials that result in lengthy dispute, thus extinguishing whatever benefit the provision was intended to provide.

Income Replacement Benefits

Insured persons are still entitled to the maximum rate of $400.00 per week for income replacement benefits (with the option for increased coverage). However, the amount is now calculated based on 70% of the insured person’s gross income in the 52 weeks before the collision, as opposed to 80% of net income. This will simplify the calculation. The Regulation defines “gross employment income” as:

Salary, wages and other remuneration from employment, including fees and other remuneration for holding office, and any benefits received under the Employment Insurance Act (Canada), but excludes any retiring allowance within the meaning of the Income Tax Act (Canada) and severance pay that may be received [19].

This will not have much impact on the amounts received by insured persons.

However, what will impact insured persons is that they are no longer entitled to make a re-election of benefits as it related to income replacement, non-earner or caregiver benefits. For new accidents, there is no re-election available except in circumstances where caregiver may not have been available until a determination of catastrophic impairment is made. In these cases, a re-election for caregiver can be made [20]. Plaintiffs’ counsel will have to pay close attention to the election to be made and analyze what benefit would best suit the injured party. What should also be considered is whether or not a catastrophic designation may be forthcoming.

Catastrophic Impairment

On a positive note, the definition of catastrophic impairment has been expanded to include single limb amputees [21].

Interest

While interest was previously charged at 2% per month compounded monthly, the Regulation has reduced the interest rate for overdue payments to 1% per month compounded monthly [22]. This new rate will apply to all new accidents, as well as any amounts that become overdue on or after September 1, 2010. For any amounts that became overdue prior to September 1, 2010, the old interest rate still applies.

Conclusion

The government has made it clear that the intent of the new Regulation is to simplify the first party insurance benefits system, reduce excessive administrative and assessment costs and provide the consumer with choice.

While it is likely that there will be a reduced number of assessments and claims given the assessment cost cap and the introduction of the Minor Injury Guideline, there may be an influx of litigation to address issues such as “incurred expenses”, “predominately minor injury” and what will constitute “compelling evidence” with respect to pre-accident impairments as they relate to minor injuries. There will also be increased reliance upon tort insurers, the Ontario health system, ODSP, welfare and private loan companies. There may be increased claims for broker negligence as well.

The limits on medical and rehabilitation expenses and attendant care will have long term implications on the extent of an insured person’s recovery. Plaintiffs’ counsel will have to be diligent in finding the best way to get their clients the most benefit possible from the new system. This will mean being creative, working together with health practitioners and increasing client understanding of the new system.

I would like to thank Oatley Vigmond LLP and McLeish Orlando LLP who prepared a paper entitled Tort and Statutory Accident Benefits Reforms effective September 1, 2010, dated September 3, 2010 which was used in conjunction with a web seminar on the SABS changes put on by the Law Society of Upper Canada. Their paper was referenced in preparation of this paper.

O.Reg. 34/10 (Regulation 34/10) under the Insurance Act, R.S.O. 1990, c.18, was made February 24, 2010, and is effective September 1, 2010.

Section 8

Section 18(5)

Section 25(5)(a)

Section 25(5)(b)

Section 38(8),(10)

Section 50(2)(3)(4)

Section 18(1)

Section 14

Section 25(2)

Section 25(11)

Section 19(3)2

Section 3(5)

Section 45(4)

Section 42(1)(b)

Section 3(7)(e)

Section 3(8)

Section 4(1)

Section 35

Section 3(2)

Section 51(2)

CHART OUTLINING SABS CHANGES

COVERAGE WHAT’S THE SAME WHAT’S NEW AVAILABLE OPTIONS

Income Replacement Benefits

-pays up to $400 per week

-7 day waiting period

-“own occ” test for first 104 weeks, “any occ” test thereafter

-collateral benefits deducted

-optional benefits available

-qualifying eligibility criteria for IRB income

-deemed employed

Worked 26 weeks of previous 52

Was 16 or more or excused from school

Sustained substantial inability to perform the tasks of employment spent most time in

-temporary return to employment does not affect eligibility to reclaim benefits

-calculation no longer based on 80% of net, but 70% of average gross weekly income

-no deduction of EI, CPP or income tax

-no limitation for MIG (old SABS had cap for length of time benefits received under PAF)

-future contract for employment gone (i.e.) no entitlement for person entitled to start work within a year under contract of employment

-insured’s accountant fees re: preparation of report for calculation of income payable to a max of $2,500

-no IRB if non-earner or caregiver elected

-collateral payments under income continuation plan deemed to include:

Periodic payments

Whether or not insurance contract includes waiting period, deductible or similar limitation or is paid for by insured’s employer

-as before, weekly limit can be increased to $600, $800 or $1000 per week

Non Earner Benefits

-26 week waiting period

-pays $185 per week for 104 weeks post impairment

-increases to $320 per week after 104 weeks for students in some cases

-criteria (i.e.) complete inability to carry on a normal life within 104 weeks of accident and does not qualify for IRB OR

was enrolled full time in school,

or completed school within one year prior to accident

-no re-election permitted

-N/A

Caregiver Benefits

-Criteria (i.e.) complete inability to engage in caregiving activities within 104 weeks

-after 104 weeks has to be complete inability to carry on a normal life

-pays reasonable and necessary expenses incurred to pay for caregiver if insured person was residing with person in need of care and was primary unpaid caregiver

-up to $250 per week for first person in need of care and $50 for each additional person in need of care

-not available under standard policy unless insured has suffered catastrophic impairment

-definition of incurred expense applies

-re-election will be permitted if insured deemed catastrophically impaired (i.e.) if previously elected IRB or non-earner because caregiver not available, can re-elect to caregiver if subsequently deemed CAT

-up to $250 per week for first dependent plus $50 per week for each additional dependant in catastrophic and non-catastrophic injury cases

Catastrophic Impairment

-insured may apply for determination

-insurer to respond, approve or assess

-if application received within 104 weeks and insured receiving attendant care benefits, insurer must continue to pay benefits as if person deemed CAT

-if declared CAT, entitled to all prior expenses that would otherwise be covered

-whole body impairment 55% of whole person

-class 4 impairment (marked impairment) or Class 5 (severe impairment) due to mental or behavioural disorder

-GSC less than 9 = CAT

-definition expanded to include single limb amputees

-committee struck to review CAT definition

-application must be completed by a physician or, if a brain impairment, by a neuropsychologist

-insurer has 10 business days to reply to an application (used to be 30 days)

-if submitting prior to two years and intend to rely upon 55% whole body impairment or class 4 or 5 impairments, physician, or physician or neuropsych in case of brain impairment, have to state in writing that impairment unlikely to cease to be catastrophic (used to be that health practitioner could state this)

-N/A

Medical and Rehabilitation Benefits

-what is covered remains substantially the same:

medical

rehabilitation

case manager services for CAT only

attendant care benefits

-$1,000,000 maximum available for CAT injuries

-treatment covered up to the maximum limit or 10 years from accident unless insured was less than 15 years of age at time of accident

-10 business days to respond to treatment plan

-$50,000 maximum limit for non-CAT cases

-Pre-Approved Framework (PAF) removed

-$3,500 limit for Minor Injuries

-cost of assessments included in the $50,000 limits and $3,500 limits for minor injuries (does not apply to IE’s)

-no optional benefits available to increase minor injury limits

-combined OCF-18/OCF-22

-minor injury guideline providing framework for treatment for minor injuries – doesn’t apply if compelling evidence of pre-existing condition that prevents insured from recovering from minor injury within guideline

-new minor injury definition – sprain, strain, whiplash associated disorder, contusion, abrasion, laceration or subluxation and any clinically associated sequelae (includes partial tear)

-no IE’s required for denial of benefits – adjuster now has to provide “medical and any other reasons” for denial (also applies to all other benefits)

-if IE chosen, adjuster has choice between paper review or in person assessment

-case management services are now payable out of med/rehab limits

-no more rebuttals (also applies to all other benefits)

-can purchase an optional benefit of up to $100,000 or up to $1,100,000 for non-CAT cases including assessment costs

-where the $1,100,000 option is purchased, there is no time limit on benefits being paid (otherwise it is still 10 years)

-can purchase an option benefit of up to $2,000,000 for CAT cases including assessment costs

Attendant Care Benefits

-pay for reasonable and necessary expenses

-Form 1 defines monthly attendant care requirements, not to exceed $3,000 for non-CAT and $6,000 for CAT

-payable for 104 weeks unless CAT

-$1,000,000 limit in CAT cases

-non-CAT benefit reduced to a total of $36,000 from $72,000

-Form 1 can only be completed by a registered nurse or OT

-definition of incurred expense applies

-subject to def’n of incurred expense, an aide or attendant for a person includes a family member or friend who does not possess special qualification

-can increase limit to $72,000 or $1,072,000 for non-CAT cases

-can purchase an additional $1,000,000 in CAT cases

Housekeeping and Home Maintenance

-up to a maximum of $100 per week available

-pay for all reasonable and necessary expenses for housekeeping

-not available under standard policy unless insured has suffered catastrophic impairment

-definition of incurred expense applies

-up to $100 per week available for all injuries (CAT and non-CAT)

Cost of Examinations

-pay reasonable fees incurred by an insured person for:

disability certificate or exam

Assessment and treatment plan

OT or RN for Form 1

Application for Catastrophic Determination

Authorized transportation expenses to assessments

-no home assessments for minor injury

-$2,000 cap for fees and expenses for conducting any one assessment or examination and for preparing reports in connection with it, including transportation, translations services and mileage (except for accountant report)

-no payment for future care plan, life plan or assessment for this purpose

-no limit to the number of assessments but not more than is reasonably necessary

-arguable that the $2,000 is per discipline not per whole assessment (i.e.) for multidisciplinary assessments

-IE examinations are not taken from $50,000 or optional limits

-assessments requested by insured reduce the medical and rehabilitation limits

Lawyers Distressed Over Insurance Reforms

Thu, 11 Nov 2010 15:17:58 GMT

But silver lining for legal profession as clients need more advice.

The latest round of automobile insurance reforms has introduced big cuts to medical, rehabilitation and attendant-care limits; the removal of housekeeping and caregiver

expenses; and the capping of assessment fees and treatment costs for minor injuries. But with only a promise to keep premium increases in check, personal injury lawyers say an unfair playing field is tilting even further away from the innocent and injured.

As of Sept. 1, the reforms reduced coverage for medical and rehabilitation limits in half to $50,000 from $100,000. Attendant-care coverage for non-catastrophic injuries is now

$36,000, down from $72,000. Housekeeping and caregiver expenses are gone unless the injuries are catastrophic. In addition, treatment costs for minor injuries are now subject to a $3,500 cap, a cut from the previous $100,000.

Not surprisingly, those who spend their days fighting for injured plaintiffs have plenty to say about the reforms. Lawrence Hatfield of Flaherty Sloan Hatfield in Hamilton, Ont., quickly sums up the changes. “We’re still paying the same amount of money but getting much less product,” he says. “You can maintain the same coverage but you actually have to ask for it, and it costs more.”

Greg Monforton, an insurance lawyer in Windsor, Ont., compares the situation to getting a cheap hamburger for the price of top-grade steak. “With each no-fault successive regime since 1990 the government of Ontario has in effect placed an armed guard at the courthouse door to keep out the majority of people injured in car accidents in Ontario, and the most recent changes arm the guard even further,” he says, noting he believes the changes are discriminatory against those who can’t afford optional coverage and vulnerable people like children and pedestrians. “Every time there’s a new set of reforms, there’s a winner and a loser. The winner is certainly not the Ontario public.”

Nevertheless, there’s been little reaction to the reforms. Brian Goldfinger of Goldfinger Personal Injury Law is frustrated by the apathy surrounding the issue. “If the government doubled the price of gasoline when there’s no world war, no gas shortage, and no crisis, people would go berserk,” he says. “If they did it just so the industry could protect its bottom line, people would be outraged. But it’s too late for outrage.”

Goldfinger blames the lack of interest on the complexity and dullness of the laws on the subject. “Insurance law is so dense, so thick, and so complicated that the changes don’t even come in the Insurance Act anymore. They come in schedules that are like acts in themselves. Considering that every car driver must have car insurance, the Insurance Act should be understandable by everyone but it is ridiculously complicated. Drivers don’t care as long as their premiums are lower, but there aren’t even any reductions. No one appreciates what

they’ve lost until they are injured.”

The changes, Goldfinger notes, are significant. “Before Sept. 1, 2010, everyone, no matter what, had $100,00 for any medical or rehabilitation expenses that were reasonably necessary

that were not covered by OHIP. That included physiotherapy, chiropractic, psychology, neuropsychology… It covers a lot. Now you’re paying the same and getting half. It does not make sense. People don’t have the money to fund their own rehabilitation. They’re going to be hurt.”

Hatfield is particularly frustrated since it was the insurance industry that asked for the current benefits regime, which stops people from suing for medical costs and instead makes them

go through the insurer. “Now they’re trying to dismantle it,” he says. “As a consumer, it’s frustrating. As a lawyer, I realize what they’re trying to do is reduce people’s rights right off the bat when they’re buying insurance.”

Another early stage where the changes will have a big impact is during assessment and diagnosis. “Prior to the changes, an individual could apply for funding to be assessed and that didn’t reduce the total,” says Brian Mathers, an insurance and casualty specialist who works within Greg Monforton and Partners. “The only test was if it was reasonably necessary. Now there is a limit of $2,000 per assessment, and it will come out of the lower amount of $50,000. So you’re paying for your own assessment.”

Monforton adds: “It’s downloading on to the innocent and injured the cost of diagnosing what’s happened to them.”

But anyone searching for benefits to offset the losses won’t necessarily find them. “The insurance industry will say that you can opt in to get pre-September 2010 benefits but you have to pay more for them,” says Goldfinger.

In fact, all of the practitioners interviewed on the personal injury side of the issue say none of their clients bought the optional benefits. “Experience has shown that most people are not properly educated by their brokers about optional benefits,” says Monforton. “Only the wealthy and the well-informed will buy them, and few Canadians are both. People get a big package in the mail, but nobody reads it. They just look for the pink slip.”

Consumers may expect such big losses of coverage would lead to a reduction in premiums, but that’s not the case, according to lawyers. “You won’t see any decreases in the foreseeable future,” says Mathers. “Many insurers have already received one if not two increases this year. The government has only promised that they will be holding premium increases in check.”

The only good news for personal injury lawyers is that their clients will need them more than ever to work through the legal ambiguities and inconsistencies to get fair treatment and

compensation.

In the meantime, while lawyers representing insurers declined to comment on the merits of the reforms, Tom Ozere of Borden Ladner Gervais LLP in Ottawa says they’ll also mean significant changes for practitioners on the tort side. “The amounts of offsets are being dramatically reduced. It will increase exposure in areas where there was previously no pretrial

exposure such as medical and rehabilitation expenses: housekeeping, and handyman expenses because the accident benefit insurers covered them before.”

Monforton, however, sees that scenario as a double-edged sword. “If you download more costs on to the tort system, this will give the insurance industry impetus to seek more reductions in the future.”

by Judy Van Rhijn

originally published Oct. 18, 2010 – Law Times

Insurer ‘playing hardball’ scores hefty fine

Mon, 25 Oct 2010 14:26:41 GMT

The Ontario Court of Appeal has hit an insurer with a $40,000 penalty for refusing to mediate a dispute it considered to be under the statutory threshold for personal injury damages, a move that reinforces the notion that even private mediation is in fact mandatory.

The dispute in Keam v. Caddey arose out of a motor vehicle accident in which Glen Keam suffered personal injuries. The defendant’s insurer defended the action.

In the meantime, Keam’s representatives sent two formal requests for private mediation that referred to cost consequences for refusal. The first request was completely ignored.

The second elicited a response claiming the insurer didn’t believe the injuries met the threshold test under s. 267.5(5) of the Insurance Act.

The trial judge, Superior Court Justice Alan Whitten, found the claim met the statutory threshold but accepted the insurer’s position as legitimate and declined the appellant’s request for substantial indemnity costs.

He referred to the Supreme Court decision in Young v. Young, which said that the type of conduct necessary to attract substantial indemnity costs must be “reprehensible, scandalous or outrageous.”

He also differentiated between a refusal to mediate or settle based on an apparently reasonable assessment and high-handed behaviour.

Both levels of court characterized the insurer’s tactic as “hardball,” but the trial judge found it wasn’t malevolent. The appeal court decision, written by Justice Kathryn Feldman, took a different approach.

She said there are two obligations on the parties: to participate in mediation and to attempt to settle as expeditiously as possible.

She also found there are no exceptions to the obligations and no legitimate reason to refuse given that “it is this approach that the legislature has disavowed by making mediation mandatory.”

As a result, Feldman found the insurer’s non-compliance attracted a significant penalty by ordering a $40,000 increase in the costs to reflect the court’s censure and provide a significant recovery for the appellants.

Lawrence Hatfield, a partner at Flaherty Sloan Hatfield in Hamilton, Ont., who represented the plaintiff, feels the court has enforced what the legislature intended.

“Both parties are required to settle out of court, and insurers have an even higher onus to do it in a reasonable manner because of the inequity between insurers and accident victims,” he says. “When insurers lose cases, they write a cheque. When a plaintiff loses, it’s a financial disaster.”

Hatfield hopes the outcome will now change the insurer’s attitude. “To meet the threshold to successfully bring a lawsuit, you need to show that an injury is permanent and serious.

What happens is that when clients with soft-tissue injuries miss a minimal time from work, some insurers won’t pay at all. My clients have bought an insurance policy and paid premiums.

There is a fiduciary duty to assist, and when there is almost automatically an adverse attitude, it’s exasperating.”

In addition, Hatfield has observed that when his clients have assets, they are more likely to have to go to court. “The approach is to go after what I call vulnerable clients to whom going to court represents a huge risk. There needs to be something to check that sort of behaviour.”

Hatfield conveyed this sentiment to the appeal panel when it asked him whether it should send the matter back to the lower court. “I told them my personal opinion was that this insurer needed to be sent a message and not by a lower court,” he says.

“Now, if the insurer takes that approach and loses, it loses hard. That’s a powerful message. I say, ‘If you live by the sword, you die by the sword.’”

Hatfield adds that while the refusal to mediate was an important part of the appeal court’s decision, it was the insurer’s denial on the threshold issue that swayed the ruling in favour of the plaintiff.

Tom Ozere, regional leader of the insurance and tort liability group at the Ottawa office of Borden Ladner Gervais LLP, thinks the decision will have a limited effect in jurisdictions that have mandatory mediation.

“The sanctions in the rules are dramatically different from what the Court of Appeal said,” he notes.

“In jurisdictions that don’t have mandatory mediation, the effect will be that parties must participate if one of the parties requests it. It goes both ways. An insurer could request it, and I would expect the same result will follow.”

Brian Goldfinger, directing lawyer at Goldfinger Personal Injury Law, is hopeful the decision could lead to more reasonable behaviour and quicker results but considers the $40,000 sum a mere slap on the wrist.

“To an accident victim who was making $40,000 a year before the accident and now making nothing, it’s a hell of a lot of money, but you’re talking about companies that report billions of dollars in profits every year.”

Goldfinger is also concerned that even though the court’s intention in reinforcing the mandatory nature of mediation is good, the practicality doesn’t always work out. “Mediation takes two to tango,” he says.

“There’s such a thing as bad-faith bargaining, where they set up mediation just for the sake of fulfilling the statutory requirement. They hire the cheapest mediator and sit at the table but offer zero dollars the whole time.”

In that scenario, Goldfinger thinks the parties may be better off waiving mediation altogether. “It’s a waste of everybody’s money if they are not taking it seriously.”

Ozere, meanwhile, points out that the appeal court didn’t define participation in mediation. “What happens at mediation is absolutely confidential,” he says. “An insurer could take a position similar to this case. Even if it makes a zero offer, it could still be participating.”

In Ozere’s view, such behaviour might not amount to bad faith. “We have an adversarial system,” he says. “The insurer may take a tough position and have a legitimate defence. It’s a matter of risk analysis.”

by Judy Van Rhijn

originally published Oct. 18, 2010 – Law Times

‘Hardball’ auto insurer hit with $40,000 ‘remedial costs penalty’

Mon, 04 Oct 2010 14:34:16 GMT

By Cristin Schmitz, Ottawa

September 17, 2010

Auto insurers in Ontario who refuse to participate in mandatory mediation — or who flout their companion statutory obligation to try to speedily settle a case — face “significant remedial costs penalties,” warns the Ontario Court of Appeal.

On Aug. 31, the appeal court slapped auto insurer Aviva Canada with paying an additional $40,000 of Glen and Heather Keam’s legal costs, on top of the partial indemnity costs of $110,000 the plaintiffs were awarded last year after an 11-day jury trial in 2008.

The Court of Appeal’s award of a $40,000 “remedial penalty” increases the plaintiffs’ costs recovery by a hefty 36 per cent, and sends a strong message to insurers that they risk serious financial consequences if they fail to meet their statutory duty to mediate under s. 258.6(1) of the Insurance Act, says the Keams’ counsel, Lawrence Hatfield of Flaherty Sloan Hatfield in Hamilton, Ont.

Hatfield told The Lawyers Weekly that, so far as he knows, the decision marks the first time that a court has imposed a costs penalty on an auto insurer for breaching its statutory duty to mediate.

Commenting that Aviva played “hard ball” with the plaintiffs, Justices Marc Rosenberg, Stephen Goudge and Kathryn Feldman held that “although the insurer’s conduct may not have risen to the level required for the imposition of substantial indemnity costs,…a significant remedial penalty was required in all the circumstances…to reflect the censure of the court and to provide an appropriately significant recovery for the appellants.”

Hatfield said some Ontario insurers have been refusing to mediate — or alternatively demanding that plaintiffs’ pay half of any mediation costs — in violation of the Act and its regulations.

He said the Court of Appeal’s decision makes it clear that insurers who flout their statutory obligation to participate in mediation — and their companion duty to “attempt to settle the claim as expeditiously as possible” under s. 258.5(1) of the Insurance Act — now face substantial costs sanctions, even if the defendant ultimately wins the case at trial.

As Justice Feldman put it “the cost consequences will follow whether the plaintiff or the defendant has been successful at trial, so that, for example, where a plaintiff’s claim is dismissed, the trial judge may deprive the winning defendant — represented by the insurer that refused to accept a request to mediate — of all or part of its costs that would normally follow the event.”

“There is no exit for the insurer,” Hatfield emphasized.

However, the statutory obligation to participate in mediation on request applies equally to plaintiffs. “In theory a cost sanction could be awarded against a plaintiff for failing to mediate when requested,” Hatfield acknowledged. “However, in reality, I must admit I have never heard of a plaintiff refusing to mediate a case.”

Matthew MacIsaac, counsel for the defendants along with lead counsel Robert Rogers of Hamilton’s Evans Philp, told The Lawyers Weekly no decision has yet been made on whether to apply for leave to appeal.

In the wake of Keam, he queried whether it remains open to an insurer as “a tenable position” to reasonably argue that a plaintiff’s injuries are not “serious and permanent” and thus do not meet the Insurance Act’s threshold for litigation. “Would you be considered to be mediating in bad faith, or wasting time, if you go to mediation with that position that the injury doesn’t meet threshold?” he asked. “If the injury doesn’t meet the threshold, the chances are you are not going to volunteer to pay anything on it. Could the plaintiff’s counsel then, at the end of the day, say: ‘Well they attended mediation, and mediated in bad faith because they had no intention of paying’ — and does that ultimately result in increased costs against the insurer?”

MacIsaac also queried how Keam jibes with the Court of Appeal’s ruling in McCombie v. Cadotte, (2001), 53 O.R. (3d) 70. McCombie seems to indicate that plaintiffs who fail to meet their s. 258.3(1) Insurance Act duty to attend a defence medical before suing should face cost sanctions only if their failure to attend prolongs the litigation, MacIsaac noted. “It seems what the Court of Appeal is saying with [Keam] is that there will be cost consequences [for failing to mediate] regardless, so it’s tough to reconcile the two decision from the same level.”

Hatfield’s client, Glen Keam, suffered chronic pain after receiving soft tissue injuries to his neck and back in a 2003 auto accident. The defendants’ insurer twice refused the plaintiffs’ request that the defendants participate in mediation. This violated s. 258.6(1) of the Insurance Act which requires the parties to participate in mediation at either party’s behest. Moreover, O.Reg. 461/96 requires the defendant’s insurer to pay the reasonable expenses and fees of the mediator (which typically range from $3,000 to $5,000, Hatfield said.)

The defendants maintained for more than four years after Keam sued, that the plaintiff’s injuries did not meet the s. 267.5(5) Insurance Act litigation threshold of a “serious and permanent” injury. In light of its position, the defence said mediation would be futile and it therefore refused two separate requests from the plaintiffs for mediation.

The plaintiffs ultimately won their case, but the trial judge rejected their request for substantial indemnity costs of $196,145. Instead he awarded partial indemnity costs of $110,000. He accepted the insurer’s position that it was entitled not to participate in mediation because of its belief that Keam’s injuries did not meet the “serious and permanent” threshold for litigation.

The plaintiffs based their request for a “remedial cost penalty” against the defendants on s. 258.6(2) of the Insurance Act which stipulates that a person’s failure to participate in a requested mediation “shall be considered by the court in awarding costs.” (Section 258.5(5) further stipulates that an insurer’s failure to attempt to settle a claim as expeditiously as possible “shall be considered by the court in awarding costs.”)

“In this case the respondents’ insurer took the position that the claim did not meet the threshold and therefore there was nothing to negotiate,” Justice Feldman observed. “However, it is this approach that the Legislature has disavowed by making mediation mandatory. Rather, the Legislature’s approach recognizes that participation in mediation could have a salutary effect on one or both sides, with input from an experienced and respected mediator.”

Justice Feldman said that in a case where the insurer has not fulfilled its obligation to mediate, the trial judge must consider the appropriate cost consequences.

She described the “costs sanction” as a “remedial penalty.” It is remedial in the sense that it is intended not only to compel insurers to comply with “an important statutory purpose” of promoting early out-of-court settlement, but also to give a remedy to the party who was deprived of an opportunity for early settlement of the claim.

“It is a penalty because it is not intended to be merely compensatory of costs unnecessarily incurred by the other party or parties, as that objective is already addressed by other costs provisions of the Rules of Civil Procedure, but to provide a meaningful consequence to an insurer that elects not to comply,” Justice Feldman explained.

She suggested such meaningful financial consequences could include substantial indemnity costs against a losing defendant, or depriving a winning defendant of its full, or partial, costs.

In this case Justice Feldman said the appeal court decided the size of the $40,000 costs penalty by taking into account: the fact that the insurer twice refused to mediate (the first time two years before trial, and the second time, more than a year before trial); the fact that the insurer “decided to ‘play hardball’ by taking the easy position that the claim did not meet the threshold”; the fact that shortly before trial, the insurer served an offer to settle which, while low, amounted to acceptance that there was a potential claim to litigate — and therefore to mediate; and the duration of the 11-day trial.

Keam v. Caddey, [2010] O.J. No. 3650.

Original Article from: www.LawyersWeekly.ca/article-1251

Police Ordered to Produce File

Mon, 04 Oct 2010 14:29:26 GMT

Police try to derail suit brought by murdered man’s family

Barb Brown – The Hamilton Spectator

Hamilton police hope to quash a negligence suit that was brought against the service by the family of a young man stabbed to death by a dangerous fugitive.

Corey Rogers, 25, had tried to turn himself into police a week before going on a stabbing rampage on Feb. 17, 2007, outside the Dizzy Weasel bar on Barton Street East. Rogers was sentenced to life imprisonment after being found guilty of murdering Paul Haggerty, 19, and Lucas Deane, 18, and wounding two other teens.

Police lawyer David Thompson went before Superior Court Justice Alan Whitten yesterday to argue that the Haggerty family’s statement of claim should be struck because it did not have a legal cause of action.

Charles Flaherty, who acts for the Haggertys, argued it was premature for Thompson to bring his motion. Flaherty and counsel for the Dizzy Weasel, Andrew Evangelista, persuaded the judge to delay the hearing until after the police disclose a list of documents that the plaintiffs are waiting to receive.

Among the documents is the full report of Niagara Regional Police, which performed an external review of the way Hamilton police handled Rogers. The dangerous fugitive was declared Hamilton police’s “most wanted” in January 2007.

A man identifying himself as Rogers called 911 twice on Feb. 10, 2007, giving his address on Tisdale Street North and saying he would like to surrender. Instead of sending a police cruiser to pick him up, the civilian call-takers suggested Rogers walk over to police headquarters and turn himself in.

He didn’t. A week later, Haggerty and Deane were stabbed to death by Rogers after an alteration at the bar. Rogers was arrested and charged within hours. Police did not reveal the 911 calls from Rogers the week before. The Spectator broke that part of the story.

Thompson intends to argue that the plaintiff’s statement of claim does not have a legal cause of action because it fails to show “a relationship of sufficient proximity” between police and Paul Haggerty that would give rise to a duty of care to a potential victim of crime before the crime was actually committed.

The same argument was made in Jane Doe v. Metropolitan Toronto Commissioners of Police in 1990. In that case, the court found that police did have a duty of care to warn Jane Doe, who was sexually assaulted in her Church-Wellesley apartment.

Her claim against Metro Toronto police was allowed to proceed because the plaintiff established a relationship of sufficient proximity between her and the police. Her lawyers argued the police were aware that a serial rapist was preying on single, white women in her neighbourhood and had a duty to warn Jane Doe and other potential victims like her.

The Haggerty lawsuit is one of four separate actions arising from the spree of stabbings committed by Corey Rogers. Other claims have been filed by the family of Lucas Deane and victims Kenny Clark and Lee-Anthony Newell, who were wounded.

Flaherty said courts in Ontario have never awarded a parent more than $100,000 in damages (subject to inflation) for the loss of a child.

bbrown@thespec.com

905-526-3494

http://www.thespec.com/news/crime/article/263167–police-try-to-derail-suit-brought-by-murdered-man-s-family

New insurance rules: ‘pay more, get less’

Wed, 25 Aug 2010 14:35:28 GMT

Standard policy cuts medical, rehab benefits in half

THE CANADIAN PRESS

TORONTO (Aug 23, 2010)

Millions of Ontario drivers will face an array of new choices when they renew their auto insurance policies because of new rules that kick in Sept. 1, but critics say the changes introduced by the Liberal government won’t benefit consumers.

One key difference in the new standard auto insurance policy will be a 50 per cent cut in medical and rehabilitation benefits, from $100,000 to $50,000, and a corresponding drop in attendant care benefits, from $72,000 to $36,000.

Income replacement coverage will fall from 80 to 70 per cent of gross income, to a maximum of $400 a week. Housekeeping expenses and caregiver benefits currently available to all accident victims will be only for those with catastrophic injuries.

However, consumers will be able to purchase additional levels of coverage in the same way they’ve been able to pay higher premiums to lower deductible levels.

Giving consumers a choice is always the best way to go, especially if it can keep premiums down, said Finance Minister Dwight Duncan.

“This will enable people to decide what’s in their best interests, what they want to pay, and I just think choice is a good thing whenever you’re shopping,” he said.

Queen’s University law professor Erik Knutsen, who specializes in insurance law, said the changes will make a bad system even worse by making it far too complex.

“No regular person can sort out what their coverage is,” he said. “And more importantly, what it means to them.”

For Full text see: http://www.thespec.com/news/article/250776–new-insurance-rules-pay-more-get-less

Lawrence Hatfield – Key Note Speaker for the Opening of Court / Red Mass

Mon, 16 Aug 2010 14:41:13 GMT

AFGHANISTAN AND THE RULE OF LAW

The invitation to the Red Mass announced my topic this morning as the “Rule of Law in Afghanistan.” As an officer with Hamilton’s Argyll and Sutherland Highlanders of Canada, I recently spent 8 months in Afghanistan with another Argyll officer helping to train the Afghan National Army. Because I am also a personal injury lawyer here in Hamilton, the topic of the “Rule of Law in Afghanistan”, I suppose, seemed an obvious one for a lawyer and a soldier but I am certain that most of you would be hard-pressed, given the almost daily coverage of Canada’s mission, to think that the rule of law had anything to do with Afghanistan. I will not disabuse you of that notion. My topic is more centred on the rule of law and Ontario than it is on Afghanistan although I will certainly touch upon it. Imagine: Warring factionalism, invading armies, hostile groups, the widespread use of political violence, the tentative hold of the administration of justice, political instability, and the use of public execution to make brutal examples to an uncertain populace.

Together, they present an image of war-torn Afghanistan and provide the numerous critics of the mission with plentiful and stark evidence to demand an early end to it. But, I am not referring to a far-off place. Rather, I am taking you back to this province and, indeed, to this local area almost 200 years ago. We are coming up to the bicentennial of the War of 1812 and, we are not far from such scenes. Let me set the picture.

In June of 1812 Canada was invaded…. two American armies pushed into Upper Canada, one across the Niagara River another from the Detroit. Unfortunately some members of the Upper Canadian parliament deserted to the Americans and formed a renegade Corps of Canadian Volunteers that committed depredations throughout this area and burned Niagara-on-the-Lake. In 1813 Hamilton was under threat of the American army that was pushing across the Niagara peninsula. Hamilton’s last ditch defenses consisted of a rag-tag group of refugees, British military units, local militia, and natives camped around the present site of Dundurn Castle awaiting a final onslaught. Twice during the spring and summer of 1813, American amphibious forces captured the capital York (now Toronto) and liberated the jail. The situation was tenuous and the outcome in doubt. In December 1813, the British military administrator of the province decided to hold a special commission on cases of treason in order “to make examples.” The commission was convened at Ancaster in May 1814 In the end, of the 17 convicted, 8 were executed on 20 July 1814 near the corner of York Boulevard and Locke Street. These men were hanged, drawn, and quartered.

Now, what does this little lesson in local and provincial history have to do with Afghanistan and the rule of law? It provides a point of comparison and a perspective to view our role that is the role of the legal community, within this society.

The invitation to the Red Mass quotes the preamble to the Canadian Charter of Rights and Freedoms whereby “Canada is founded upon principles that recognize the supremacy of God and the rule of law….” Principles that recognize … the rule of law” it’s a phrase that bears repeating. At the same time of our local instability, Napoleon a man who knew something of disorder and order in society but understood clearly, as he put it: There is no authority without justice.”

Canadian soldiers are used to the obvious characteristics of Afghanistan – the heat, the cold, and the incessant wind. You get used to them, you adapt to them, and you endure them. But, there are things that cannot be endured. There is an old saying that there is no justice without the sword. This is true but I can tell you that with just the sword, there is also no justice.

In the seemingly endless debate about the mission in Afghanistan, commentators note the need for clean water, proper sanitation facilities, roads and bridges, schools, hospitals, an economy based on something other than opium, and on the list goes. Certain critics want us to concentrate only on these admittedly good things. However, in Kandahar province, this country’s soldiers strive to establish order as a foundation for everything else, for anything else. What is most important? These answers are easy: first is order and a close second is the rule of law. Law which the inhabitants of that country accept over the rule of individuals whether they be tribal chieftains, criminals, or thugs of whatever description who know nothing beyond the sword.

My tour in Afghanistan brought home to me that without the rule of law, there is nothing beyond the rule of force. I have seen it in Afghanistan and I have done my modest bit as a soldier to help that society establish a national army to guarantee order. I want to take a moment to briefly explain my job of helping to train the Afghan National Army also known as the ANA.

The ANA is one of the few success stories in Afghanistan as they are in the process of creating a true professional army. This volunteer army is working hard to overcome traditional tribal and ethic loyalties to create a truly national institution that will eventually enable the country to become self sufficient in its own security. Training the Afghan soldiers was a rewarding experience on two unique levels. First was the personal experience of working daily with the Afghan soldiers. The Afghans are natural warriors who have no shortage of courage but rather lack the training, skills and organization of a professional army. Often when we were outside of the camp it would be just myself and another Canadian soldier with a company of 200 Afghan soldiers, there is no question that I trusted them with my life.

Many of my Afghan friends and comrades spent much of the time of the Taliban rule living in refugee camps on the border of Iran or Pakistan. They returned at the fall of the Taliban with hope of returning to and building a better country. They always expressed an appreciation of the assistance we provided. They were impressed that we would leave our country and our families and risk our lives to help them. They are people who have nothing but would literally give you the shirt off their backs. My experience gave me a true appreciation for the Afghan soldier and the Afghan people.

The second rewarding part of my position is that I could see first hand real progress being made with the soldiers I worked with. Every month the quality and quantity of the soldiers in training increased and even more important is that the Afghan military leaders continued to assume more responsibility over time. By no means is the ANA perfect, they still have a long way to go and Canadian troops in Kandahar are sustaining order while the ANA is building. With the ANA I believe they are doing it the right way, not the quickest, cheapest or easiest but the most effective and sustainable over the long term.

But with the success of the Afghan Army and the imposition of order must come the rule of law beginning with a professional police force and a legal community dedicated to the principles of the idea of the rule of law.

I have seen a war torn country and I consider myself blessed to live in a country governed by the rule of law and to work in profession, which embodies the reality of the rule of law over the rule of force. The combination of order, political stability, and the rule of law is rare in the world, and 200 years ago it had not yet sunk firm roots here. Over time, it did, however, it was not perfect but in human society comparison reveals how good it is.

It was accomplished through the work of a group of people dedicated to the principles of the rule of law. A group of professionals including such lawyer/soldiers as Allan MacNab in the 1850s. Over the course of the 20th century, this profession has striven daily to ensure that these blessings are maintained in our day-to-day life. And, members of this profession have served militarily to ensure the continuance of this way of life. Members of our legal community have provided the ultimate service and made the ultimate sacrifice.

My own Regiment – the Argylls – was the creation of two soldier lawyers in Hamilton – William Chisholm and Alexander Logie. During the Second World War both of Hamilton’s esteemed infantry regiments Argylls and the Royal Hamilton Light Infantry affectionately known as the Rileys were led by members of the legal profession. In my own regiment I note Captain Mac Smith, a practicing lawyer who months before completing his PhD dropped everything, and took a reduction in rank to join the regiment off to war. On April 8th, 1945 a single bullet found Captain Smith in the final days of the war while he was attempting to cross the Ems River, in Germany…. He died instantly. A commanding officer of my regiment LCol Fred Wigle, a Hamiltonian and a member of one of Hamilton’s famous legal families gave his life overseas as well. Another prominent member of our legal community the Honourable Mr Justice and Lieutenant Colonel Hugh Arrell was a wartime commanding officer of the Royal Hamilton Light Infantry he was in fact the CO who brought the Rileys back home to Hamilton at the end of the war.

Members of our profession are noted for their post war military service such as the Honourable Mr Justice Lofchik who as a young man served as a peacekeeper in the Gaza Strip and his son now serves in the Argylls and is currently training to deploy to Afghanistan in the next rotation. Today there are members of our legal community that continue to serve with the Canadian forces. I believe it should be no surprise to anyone here today that Hamilton’s legal community has a proud history of military service. The concept of service to others in ingrained within this community. From the early days of Hamilton to the present, the Hamilton’s legal community has an outstanding reputation of service to country and community. Whether it be International scale such as the missionary work of The Honourable Mr Justice Marshal or on the local level of leading the local soccer team members of our profession volunteer their time, their money, and their talents to help make it a better place. They provide leadership in a wide range of local institutions and always the aim is the greater good of the community.

Jokes about lawyers are a dime a dozen and, no doubt, some may nod in agreement with the recent attack upon lawyers published in Macleans. So be it. But, rare is it that there is not a board, an organization, or a charity, in this community that does not include a member of this legal community. In our profession time is critical, it is measured, billed, docketed and valued and it seems there is just never enough of it. Yet, as a profession, we embody a sense of service…. or duty as we call it in the military – it is just expected. Law School applicants are advised not to apply without a record of community service, law schools themselves have more student organizations focused on community service than any other faculty and young lawyers are expected to continue this involvement upon entering the profession. It is not just expected but assumed that when you enter law you give back. If I were to name the numerous community groups and charities in the Hamilton area such as the Big Brothers , the United way or the YMCA just to mention a few and asked that people stand if they belonged to them, it would not be long before I had standing audience. This sense of service of our community I believe is based on the same fundamentals as our service in Afghanistan. I think this esteemed audience understands that. Our Mission in Afghanistan is hard, it is varied, it is multi-faceted and it brings Canadian soldiers into combat for the first sustained time since Korea.

Over the past 30 or so years, Canadians have come to think we can have justice in the world without the sword and when in Afghanistan we draw the sword, many Canadians are shocked and wonder: whether it is worth it, or whether there is an easier way, or suggest that someone other than Canadians should do it. How this growing debate will unfold, I have no idea. I will say this. From our own experience over the past 200 years, we should realize that the combination of order and the rule of law are the fundamental building blocks for everything else, and they don’t come easily, and they do take time. We didn’t achieve it in 5 years or even 50 years but we did achieve it. Was it worth it? I think about my profession, how I live my life day-to-day, how my wife and I raise our family, and answer yes. When I hear of Canadians leaving Afghanistan I wonder what would have been Allen McNab”s, Mac Smith”s, or Hugh Arrell”s reaction to such notions.

Personally when I think about it I go back to a quote of Thomas Paine (a philosopher of the American revolution) that was posted in my camp in Afghanistan which I would see every time we left the security of camp to conduct operations. It read: “If there must be trouble let it be in my day, that my child may have peace”

Afghanistan is a country that has had a history of war and turmoil. Afghanistan has been locked in Canada’s 1800s for too long to remember. The past 30 years have been particularly brutal. Young AFGHAN soldiers I have trained had no exposure to good government, justice or stability; they have grown up under tyranny, turmoil and war. From communist rule, to the war with the Soviet Union, to civil war and then the Taliban. Afghanistan is struggling and needs help. When people question why should we help Afghanistan. I go back to that ideal of service to others we cherish in this legal community. This ideal was not lost on one Canadian soldier who wrote:

“Look at the world we live in and think not of your neighbour down the street but think of your neighbour from another country. Think of their children and the plight they exist in each day. Remember this as we soldiers go and do our jobs. Remember that we go, even in the face of imminent danger, we go of our free will. Most with reason and purpose tied to our homes, our love of country…. Support us even in times of hardship. Without our nations’ support, we have no heart, no purpose, and no soul. We, the Canadian soldier”

Private Mark Graham, wrote that in May 2006, three months before he became the 32nd Canadian Soldier to die in Afghanistan and the first Hamiltonian. Private Graham emphasizes the importance of the support from home and since I have this forum I want to take a moment to acknowledge and give thanks to those who have supported me and my family during my tour in Afghanistan. I could not but acknowledge my Regiment the Argylls and the many Argyll friends who supported my family and I throughout the tour. My Argyll comrades in Afghanistan specifically Lt Col Geordie Elms and Captain Carlo Tittarelli. I soldiered with Carlo everyday in Afghanistan he was always there to “watch my back”. In Afghanistan Carlo also found his calling with the law and just last week started University of Western Ontario law School he asked that I put in a good word for a articling job. My clients, all supported and none complained. The Hamilton legal community was unwavering it is support, I am certainly grateful for all the accommodations from bench and bar to the disruptions to my legal practice. The lawyers of Sullivan Festeryga specifically The Honourable Mr Justice Harrison Arrell and Dan Rosenkrantz who supported Shari and I in a very difficult situation. My friends and colleagues in the Morris Law Group (specifically Sumitra, Alicia and Janice) who shouldered the extra load. Bill Morris, my mentor, my friend. I was a little disappointed in a recent Hamilton spectator article on employer support for army reservists. It did not do justice to the overwhelming support I have received. Bill has been one of the biggest supporters of my military career; I still remember the day I went in to ask him about deploying to Afghanistan, after he asked me if I was nuts he did not hesitate in throwing his support behind me. Bill I truly do appreciate it. Finally, I thank my wife Shari. She is the real armour of this soldier, she dropped her practice to take over mine, without her steadfast support of me and our young family, I could never have gone to Afghanistan.

I thank you all for helping me….Afghanistan was an experience that taught me much about soldiering and even more about the priceless gift so often taken for granted by Canadians – the rule of law.

Major Lawrence Hatfield

Hamilton

10 September, 2007

Address to Hamilton City Counsel on Behalf of Afghanistan Veterans

Mon, 16 Aug 2010 14:39:40 GMT

An Address by Lawrence Hatfield

Mr Mayor, members of Council, and guests,

It is my privilege today to speak on behalf of those here tonight in military uniforms, those who have recently returned from tours with the Canadian Forces in Afghanistan. These men and women have, like so many other members of this community before them, answered the call. From the War of 1812, to the Boer War, to First and Second World Wars, to the Korean War, to the large number of UN, NATO, and peacekeeping missions, to now Afghanistan.

At the core of Hamilton’s military past and traditions are its two esteemed infantry regiments: The Royal Hamilton Light Infantry and The Argyll and Sutherland Highlanders of Canada. The tradition of service continues with other units including: the 11th Field Regiment, 23 Service Bn and 705 Communications Squadron.

Hamiltonians have answered the call for almost 200 years! Few communities in this country have such a record of service and such a record of support for that service. Our presence here tonight is a tangible reminder of the connection of this community to Canada’s position abroad; it honours the virtues of military service in general and the sacrifice of Hamiltonians who have both served and fallen in Canada’s wars. It reminds us of the high cost of citizenship and what it may mean to belong to this community.

There is much rhetoric about service and even more about what Canada owes its citizens. But the soldiers before you tonight represent the highest accountability of a citizen to their community and of their commitment to what this community represents whether at Vimy Ridge in 1917 or in Kandahar in 2007.

It is a truism that we are a privileged people and take much for granted; truly, we have much to be grateful for and those who have returned safely from tour know that fact all-too-well. Afghans lack clean water, proper sanitation, reliable energy supply, a professional police force, and suitable transportation networks – the very stuff of good, local government, the very stuff that we enjoy here in Hamilton. In Afghanistan, Canadians have taken on a difficult challenge to bring order and security to that war-torn land while aiding the people in developing the institutions to protect them and to deliver to their citizenry what we take for granted.

The roles of Hamilton’s soldiers in Afghanistan were as diverse as the Canadian Mission. Some were in the line infantry battalions combating the Taliban, some were constantly running the gauntlet of Improved Explosive devices on convoy duty, some were providing key logistical and headquarters support, while others where involved in developing Afghanistan’s government and security institutions.

The foundation for much of Hamilton’s military tradition is the citizen soldier. The citizen soldier is a volunteer in every sense of the word. While it may seem as a part time job there are often real full time commitments. Citizen soldiers on deployment often make sacrifices with their civilian careers. However when it comes to the sacrifices every soldier will point to their families whose deserve our recognition and appreciation.

A city is more than the sum of its parts. The community and its ethos are formed out of the struggles of the past, a shared history of sacrifice and a profound sense, forged in war, of the place of this community and this country in the world. As we look forward to the future, it is always salutary to remember from whence we came and what it cost: then, today, and tomorrow.

This form of service – represented by those in uniform today – is at the very heart of both Hamilton and Canadian community and represents both at their best. Those who have served in Afghanistan and those who will in the near future – and there are more to come after us – appreciate the support of this city and its council.

Community support comes in many forms. We have experienced support from large organized groups to individual elementary student who sent letters some enclosing their highly prized gummy bear stash. Support from the country but especially from our own community was important and very much appreciated.

We ask that you the representatives of the people of Hamilton accept on behalf of this entire community our appreciation for all of this support.

And please allow me to introduce my firm’s new website for personal injury law – we support and represent the men and women of the Canadian Forces in any and all personal injury claims they may have.

Major Lawrence Hatfield

The Argyll and Sutherland Highlanders of Canada

25 April 2007

Threshold Update

Thu, 12 Aug 2010 14:42:30 GMT

THRESHOLD UPDATE: NISSAN AND ITS AFTERMATH

[Posted as relevant case law by the personal injury lawyers of Flaherty Slaon Hatfield]

The most recent amendments to the Insurance Act[1] otherwise known as Bill 198 came into effect on October 1, 2003. The amendments came by way of Ontario Regulation 381/03 which amended O.Reg. 461/96 and added definitions of the terms making up the general threshold identified in s.267.5(5) of the Insurance Act. The Regulation now defines the terms “serious”, “important” and “permanent”. The Regulation also sets out the evidence required to meet the threshold. For ease of reference, the defining regulation is attached at Schedule “A” to this paper. Prior to Bill 198, it was widely accepted that the Court of Appeal’s decision in Meyer v. Bright; Lento v. Castaldo; Dagliesh v. Green[2] was the starting point for any threshold analysis.

Nissan v. McNamee

Until the recent decision of Justice Morissette in Nissan v. McNamee[3], the first threshold decision under the new Bill 198 regime, there has been much discussion about what impact Bill 198 would have on threshold decisions. For the most part, it was felt that Bill 198 simply codified the decision in Meyer v. Bright. It is almost identical to the definition of a serious impairment set out in Meyer v. Bright. The question was whether or not the plaintiff would face a higher burden of proof, in other words, whether or not it would be harder for plaintiffs to meet the threshold.

Madame Justice Morissette was the first judge faced with the task of interpreting O.Reg. 381/03. Ms. Nissan was involved in a motor vehicle collision on November 2, 2003. She suffered whiplash type injuries. At the time of the collision she was employed part-time as a cleaner, prior to which she was employed for a number of years in a pizza shop. After the collision, Ms. Nissan returned to “work-like” duties at least five months post-accident at a pizza shop. She worked weekend shifts three nights a week and was not paid for her work (it was volunteer). She testified at trial that she could only engage in the physical aspects of this employment after consuming large doses of Percocet. Information regarding this volunteer work was not provided to Ms. Nissan’s health care professionals. Ms. Nissan advised, rather, that she was unable to return to work.

Surveillance videos viewed during the course of the trial showed Ms. Nissan engaging in all of the activities that would have been require of an employee at a pizza shop. Medical evidence tendered during trial also revealed that Ms. Nissan’s employer at the cleaning company agreed to accommodate Ms. Nissan through reduced hours and/or teaming her with another worker. Ms. Nissan never sought or made use of these accommodations.

Madame Justice Morissette concluded that Ms. Nissan did not meet the threshold as she misled her health care professionals. She felt that Ms. Nissan’s complaints did not prevent her from returning to employment of the same nature as she had before the motor vehicle accident. She agreed with Dr. Reznek, Dr. Upton and Drs. Clifford and Zabieliauskas in this regard and held that Ms. Nissan’s reports of injury were inconsistent with the level of function shown in the surveillance evidence. She went on to say that Ms. Nissan also did not have an impairment that substantially interfered with most of her usual daily activities.

Despite Justice Morissette’s conclusions regarding Ms. Nissan, she did provide much insight into the interpretation of the new Bill 198 regime and the definitions under O.Reg. 381/03. She reviewed, in detail, comments made by Ruth Sullivan in Dreidger on the Construction of Statutes 3d ed.[4] in her analysis of the purpose of legislative amendments. She ultimately determined that because the definitions were added by regulation as opposed to an amendment to the Act, the sections added by regulation are essentially confirmatory of the prior law and “efforts to reframe the broad approaches that have been applied since Meyer should be resisted”[5].

In addressing the distinctions that have arisen between the threshold approach taken in Meyer v. Bright and the definitions now contained in the Regulation, Justice Morissette concluded that

most of the regulation does not appear to support any significant change in the interpretation of the threshold. In general terms, it suggests at best some clarification of the law regarding accommodation. The only exception is the addition of the word ‘most’, which suggests a higher threshold where impairments affect daily living but not working.[6]

She also disagreed with defence counsel who argued that the express requirements for proof suggest a higher standard as to the threshold itself. She held that the evidentiary requirements set out in s.4.3 of O.Reg 381/03 are for evidence necessary to prove the threshold in any case with the focus being on the evidence coming from a physician. She went on to state that “the source of the evidence should not change the standard on the threshold question”[7].

Saikaly v. Buck

Justice Morissette paved the way for cases that would follow. On May 16, 2008 in Ottawa Mister Justice H.R. McLean rendered an oral decision on a threshold motion in the absence of the jury following trial in Saikaly v. Buck[8]. Much of the argument before Justice McLean addressed what impact the amendments had on the threshold analysis rather than on the application to the facts of the case. Justice McLean had the benefit of having the Nissan case brought to his attention, having been rendered only sixteen days prior. He reviewed Justice Morissette’s decision and found it to be “highly persuasive with regard to her findings”[9]. He finds no reason why he should come to a different conclusion than Justice Morissette. Justice McLean invited counsel to make further submissions as to the factual basis for a threshold finding based on Justice Morissette’s interpretation of the law.

Unfortunately, the transcription of the second part of Justice McLean’s ruling has not yet been released; however, Justice McLean found that the Plaintiff met the threshold on the basis that her impairments substantially interfered with most of her usual daily activities. Briefly, the motor vehicle collision occurred on October 17, 2003. The Plaintiff suffered a serious knee injury requiring surgery but had a remarkable recovery. She suffered from chronic pain and depression. She returned to her pre accident employment with significant accommodation from her employer. Pre-accident the Plaintiff was very family oriented, taking care of the household, husband and two teenage children. She was social organizer for her group of friends. Following the collision, she continued to clean her home but at a significantly reduced capacity. She will nap every two to three hours every afternoon after finishing work. She became overwhelmed by her household tasks and had no intimacy with her husband. Justice McLean found the Plaintiff’s impairments relating to her knee (difficulty squatting, kneeling, climbing stairs) substantially interfered with most of her usual activities of daily living.[10]

Sherman v. Guckelsberger

The next decision to be made was by Madame Justice Milanetti on December 29, 2008 in Sherman v. Guckelsberger[11]. This case arose out of a motor vehicle collision that occurred on March 10, 2004. The plaintiff suffered from headaches, neck and shoulder pain, back pain and tingling in the arms. The only medication being taken at the time of trial was Tylenol for neck pain and headaches. At the time of the accident the plaintiff was employed as administrative staff at a doctor’s office. She was off work for a short period of time but eventually returned to work full time, four days a week, although she could fluctuate her hours depending on the volume of work. She also took on a bookkeeping job following the collision. She was able to do this job from home and it resulted in an additional income of $6,000 to $7,000 per year. In 2007 the plaintiff reduced her work hours from 4 full days to 2 full days and 2 half days. It was an 8 hour reduction per week and resulted in the loss of $150.00 per week. She made the decision to reduce her hours on her own (it was not encouraged by any physician) but it was supported by her family physician and her employer testified at trial that he provided the plaintiff with accommodations but the plaintiff had been complaining about the inability to continue working full time hours due to accident related pain and fatigue. The plaintiff continued to do the bookkeeping job.

The evidence at trial was that the plaintiff continued to go camping after the accident. She took a trip to Florida with her family in 2005 and she had regular attendance at the gym and massage therapy sessions. She had gone figure skating once a year since the accident. The evidence for the plaintiff, in addition to her physicians, came from her employer, mother, sister and boyfriend. Her mother and sister did not testify regarding the plaintiff’s ability to work or difficulties with her employment tasks. Ms. Sherman’s boyfriend testified that she had difficulty with coping with work in the first year following the collision such that she would go to sleep upon returning home from work, she had increased pain, she was limited in the housekeeping she could do and she had a decreased social life. He also said that the longer the plaintiff worked full time the less she was able to deal with the pain and the more tired she became. He did, however, admit that when the plaintiff cutback her hours at work it improved her life.

Justice Milanetti had some issues with the medical evidence presented. The plaintiff called Dr. Kumbhare as a medical legal expert. The Defendant called Dr. Upton, who conducted a paper review only, and Dr. Zabieliauskas. The plaintiff also called her family physician although Justice Milanetti had issues with the credibility and objectivity of the family physician, noting that the doctor was too much of an advocate for the plaintiff. Justice Milanetti was also disappointed that the plaintiff did not call the neurologists who had interpreted two conflicting EMG’s (one was normal and the other, conducted later, had positive findings). An MRI conducted in 2008 showed disc extrusion, posterior anal bulging and marginal osteophytes. Also at issue was the plaintiff’s pre-accident medical condition. She had been seeing a cardiologist for management of a congenital heart disease. Justice Milanetti found it troubling that the plaintiff had not mentioned her accident related symptoms to the cardiologist and the cardiologist had mentioned, on several occasions, that the plaintiff was doing well. The plaintiff explained that she did not make reference to the motor vehicle collision because the cardiologist was seeing her for her heart, not accident related impairments, and the references to her doing well related to her heart condition.

While Justice Milanetti felt the plaintiff was credible, save and except for the situation with the cardiologist, she was critical of the plaintiff’s unilateral decision to reduce her work hours three and a half years post-accident. She was critical of the fact that it took so long for the plaintiff to reduce her work hours and that she kept her bookkeeping job. She was not convinced of the severity of the whiplash injury suffered.

Counsel for the plaintiff conceded that the threshold would not be reached based on an impact on daily life activities and to the plaintiff’s high level of unaffected function. So the threshold analysis focused on the diminished work capacity of the plaintiff. Justice Milanetti felt that there were credibility issues in this regard because all of the information regarding the reduced work load came from the plaintiff and it was her decision alone to decrease her hours. She felt it was hard to believe that a woman functioning at such a high level was not capable of maintain the work she did for three and a half years post-accident and she was able to take on a second job. While she liked the plaintiff as a witness, she held that the plaintiff did not meet the threshold in this case.

Aside from her decision on the threshold, Justice Milanetti made some comments regarding the threshold analysis under Bill 198. Her comments seem to be in stark contrast to the conclusions made by Justice Morissette and Justice McLean in the two preceding Bill 198 threshold decisions. She held that

If the legislators saw fit to amend the legislation yet again increasing the deductible for claims under $100,000 and making it so much more specific, they did so with a view to tightening it up from the former version.[12]

She further stated that she took a different view of the changes to the legislation for that of Justice Morissette in Nissan. However, she does not expand on how her view is different. She did state that the “new legislation does not make prior case law irrelevant”. She referred to pre-Bill 198 cases of plaintiffs who met the threshold and continued to work despite pain. The significance of these comments is that pre-Bill 198 cases will continue to be relevant in the court’s analysis of the threshold on a case by case basis. The judge’s will continue to consider how judges in pre-Bill 198 cases applied the facts in each case to the threshold analysis.

In the Sherman case, Justice Milanetti looked at the definitions in the Regulations and the pre-Bill 198 case law. She held that she could see how the reduction of ¼ of one’s required work hours would constitute substantial interference with one’s regular job but the complicating factor for Ms. Sherman was that she reduced the hours of her normal job but picked up more hours at another job so for three and half years she did more than her usual work. Further, she could not find what “function” was impaired. She took issue with the level of activity of the plaintiff in her social/recreational life which was in stark contrast to someone incapable of maintaining her quite light duty employment four days per week. The plaintiff did not identify any tasks she could not do in her work, but rather gave a general description of ongoing pain symptoms that wore her down. Justice Milanetti accepted that this may be something that could satisfy the “function” test if the completion of the totality of the job requirements prevented the individual from any other aspects of her life, which was not the case for Ms. Sherman. Justice Milanetti felt that the plaintiff did not adduce sufficient evidence to satisfy s.4.2(1)2.

Burns v. McCormack

Two days after Justice Milanetti’s decision, on December 31, 2008, Madame Justice Rady of the Ontario Superior Court of Justice released her decision on a threshold application in Burns v. McCormack[13]. This case involved a motor vehicle collision that occurred on August 25, 2004. As a result of the collision, the plaintiff suffered from shoulder pain, hip pain, neck pain and headaches. She required trigger point injections. The shoulder and hip pain resolved but by the time of trial she continued to suffer from neck pain and headaches. Pre-accident the plaintiff was a receptionist at a dental office. She continued to work full-time post accident, with accommodation. Her intention was to reduce her work load to 80% in 2006 but was not able to do so by the time of trial. She was working at the expense of her family life. Evidence at trial suggested that her pain interfered with her pre-accident activities such as hiking, dancing and bowling. The plaintiff testified that she scaled back her activities at her church and in providing pastoral care and that her relationship with and ability to care for her children was negatively affected by her pain. Together with her treating physicians, the plaintiff’s employer, co-workers, long time friend and former and present husbands testified on her behalf.

Defence counsel argued that the plaintiff did not meet the threshold as she continued to serve on the executive of her dental association, socialize with friends, worked full-time, went shopping and engaged in some housekeeping duties. He also argued that the plaintiff was able to re-marry following the collision and now had five children in her home (her own children and those of her husband). She was able to go on vacations with her family as well.

Justice Rady held that the plaintiff met the threshold. In her decision she noted that the plaintiff’s complaints were genuine and there was no contention by the defence otherwise. She had no doubt from the doctors as to the genuine nature of the plaintiff’s complaints. She preferred the evidence of treating physicians to that of Dr. Soric. Justice Rady further held that in a threshold analysis the starting point is Meyer v. Bright despite the evolution of the language in the Insurance Act. She went on to state that:

[t]he determination of what constitutes and important bodily function [now an important physical, mental or psychological function] is essentially one of the fact requiring a consideration of the ‘injured person as a whole and the effect which the bodily function involved has upon the person’s way of life in the broadest sense of that expression’.[14]

In her analysis of whether there was substantial interference, Justice Rady concluded that the fact the plaintiff continued to work was not determinative of the analysis. At paragraphs 14 and 15, she referred to the decision of Dennie v. Hamilton[15], in which Justice Whalen quoted from Hartwick v. Simser[16]:

A serious impairment is determined by reference to the condition and situation in the life of a particular injured person. What is serious to some will not be serious to others. What is serious must be resolved on a case by case basis. However, a serious impairment is generally one that substantially interferes with a person’s ability to perform his usual activities of daily living or continue employment. Even where full-time employment is resumed, albeit in a reduced capacity or in an altogether new area from that performed by a claimant pre-accident, this will constitute a ‘serious’ impairment” see Lento v. Castaldo, [1993] O.J. No. 2446 (C.A.).

Justice Rady commented that the plaintiff “is to be credited for continuing to work, notwithstanding its toll”.[17] She felt it would be “counterproductive to penalize an injured person for making genuine attempts to resume and maintain employment, notwithstanding the toll by necessarily concluding that there could be no substantial interference by virtue of continued employment”.[18]

Justice Rady applied Justice Morissette’s approach in Nissan to her analysis of the threshold. She accepted that when looking at whether or not the plaintiff’s impairment is permanent and of a nature expected to continue without substantial improvement when sustained by persons in similar circumstances, the plaintiff would have to be compared to others with whiplash associated disorder who have developed chronic pain as opposed to those who sustained the same injury but who did not develop chronic pain. She noted that the words “similar circumstances” are not clear but it would be “difficult to accept that the intent of the drafters of Bill 198 was to eliminate, for example, compensation for persons suffering from chronic pain by requiring a comparison to those who have not developed chronic pain”[19].

The last comment made by Justice Rady was that chronic pain is a legitimate condition recognized by the medical profession and the courts, as outlined in Nova Scotia (Workers’ Compensation Board) v. Martin[20]. Not only is this decision important as it relates the new threshold under Bill 198 but it also gives credence to the Nova Scotia (Workers’ Compensation Board) case which is often referred to by plaintiff’s counsel but seemingly discounted by insurance companies.

Ali v. Consalvo

The most recent reported Bill 198 threshold case was released February 6, 2009, a decision of Justice Wilson in Ali v. Consalvo[21]. This case involved a motor vehicle collision that occurred on May 30, 2004. The plaintiff was a homemaker at the time of the accident and, as such, the focus was on the inability to do the usual activities of daily living. Justice Wilson only looked at Justice Milanetti’s decision in Sherman v. Guckelsberger. He did not consider Justice Morissette’s decision in Nissan. The only comment that Justice Wilson made regarding how to apply the threshold post-Bill 198 was that he agreed with Justice Milanetti’s comment that prior case law is not irrelevant because of Bill 198. He stated that “it is of great assistance in determining what constitutes permanent, serious, continues injuries and what constitutes an important function”[22]. He added that “each case must be determined on its own facts and the same injury does not result in an identical outcome in each person”[23].

Justice Wilson concluded, based on the facts presented to him, that the plaintiff did not meet the threshold. He had significant concerns about the plaintiff’s credibility. The plaintiff was 55 year of age at the time of the collision. She had seven children. The evidence presented by the plaintiff and her collateral witnesses was that she was a traditional Somali wife and mother responsible for all of the household duties, and teaching Somali customs, religion and language to her kids and grandkids. She was very religious, attending the Mosque, prayer five times a day, going to the Somali community centre for volunteering. She would go to the mall and care for her grandchildren regularly. After the accident, the plaintiff testified that she could not bend or kneel to pray, she could not carry out household tasks, she did not work, and did not organize or attend family functions. She also testified that she had not gone to the Mosque because she could negotiate the few steps to get to the bus stop. She had not gone to the community centre or mall and did not care for her grandchildren anymore.

The issue in the case was the plaintiff’s pre-accident medical condition and level of function. The plaintiff had pre-accident right knee and low back pain. She saw a chiropractor once and had a cortisone injection for the knee. The plaintiff’s evidence was that any problems she had pre-accident did not impact on her level of function. She was diagnosed with osteoarthritis of the back in 2000 but she testified that this was “not a big problem”. She denied any physiotherapy treatment which was recorded in the family physician’s notes. The family physician also prepared a note to Ontario Works in 2000 indicating the plaintiff’s functional limitations and the use of a cane. The plaintiff was requesting payments for medication. The plaintiff clarified at trial that by the time of the collision she was fine.

The plaintiff’s medical expert, Dr. Ogilvie-Harris, testified that the plaintiff suffered from chronic pain post-accident but he admitted that he was not aware of any of the plaintiff’s pre-accident medical history. Justice Wilson felt Dr. Ogilvie-Harris was too much of an advocate for the plaintiff. Further, the plaintiff did not disclose her pre-accident medical history to Dr. Soric. Despite the plaintiff’s comments regarding her post-accident level of function, she advised a kinesiologist and occupational therapist she saw shortly after the accident that she was able to ascend and descend a series of 15 stairs, was able to make all the meals for her family, take the bus, bend and clean and help her daughters with the laundry. At trial, the plaintiff denied making these statements. The plaintiff had no medical treatment after one year post-accident.

Justice Wilson did not accept that the plaintiff’s impairments were accident related and, even if they were, he felt that they did not substantially interfere with most activities of daily living given the medical evidence presented at trial.

Important points from the case law under Bill 198

Although all but one of the above noted threshold cases found that the plaintiff did not meet the threshold, those cases all involved credibility issues and a failure to present sufficient evidence to satisfy the threshold as defined in the regulation. The majority of the cases support the propositions that the changes to the legislation are simply a codification of Meyer v. Bright and that the burden is no higher on the plaintiff post-Bill 198. While Justice Milanetti indicated that she viewed things differently than Justice Morissette, she did acknowledge the importance of considering case law as it relates to the analysis of the threshold pre-Bill 198.

Pre-Bill 198 Threshold Rulings

Given Justice Milanetti’s comment that it is important to consider these cases in a Bill 198 threshold analysis, I will outline a few pre-Bill 198 threshold decisions rendered in the last year. Of particular note is that, in some of the cases, the judges have actually commented that Meyer v. Bright is still the starting point and that there should be no change in approach despite the existence of Bill 198.

Brak v. Walsh

On April 1, 20008 the Court of Appeal rendered a judgment in Brak v. Walsh[24]. The trial judge had granted a threshold motion. The Plaintiff appealed. The Court of Appeal held that the trial judge erred in the standard he applied both with respect to permanency and seriousness of the plaintiff’s injuries. The Court of Appeal felt the trial judge’s analysis of the seriousness of the injury was too narrow. The judges would not render a final decision on threshold due to credibility issues; however, I include this case to outline some of the comments made by the Court of Appeal relating to “serious” impairments.

In this case, the plaintiff suffered a low back injury as a result of the accident. She returned to work and was able to engage in some domestic duties. The evidence was that the pain would decrease with time if she engaged in a reasonable exercise and weight loss program. In making his decision, the trial judge considered only that the plaintiff was able to carry on with her full range of activities but did not consider the evidence of the lay witnesses regarding the plaintiff’s overall enjoyment of life. The Court of Appeal held as follows:

The requirement that the impairment be ‘serious’ may be satisfied even although plaintiffs, through determination, resume the activities of employment and the responsibilities of household but continue to experience pain. In such cases it must also be considered whether the continuing pain seriously affects their enjoyment of life, their ability to socialize with others, have intimate relations, enjoy their children, and engage in recreational pursuits.[25]

There have been no further reported decisions on this case.

Rosypskye v. Stewart

Justice Matheson made a decision on May 29, 2008 to grant the defendant’s threshold motion and dismissed the plaintiff’s action in Rosypskye v. Stewart[26]. The plaintiff had been involved in four motor vehicle collisions. The subject action involved the fourth collision only. The medical evidence was scarce regarding the impact of the fourth collision on the Plaintiff. Only one medical report was relied upon postdating the fourth collision. It was dated three months post accident. At the time of the trial the plaintiff was 71 years of old with limited English. She was the only witness called by plaintiff’s counsel. Counsel relied on the documentary evidence, which included medical records relating to the first three collisions. Justice Matheson found it hard to believe that the plaintiff, who received treatment following her first three collisions, had suffered a permanent and serious impairment following the fourth collision and not receive any treatment. He held that there was “a paucity of evidence that would lead [the court] to conclude that the plaintiff had overcome the burden of proof that was on her to establish that she had met the threshold”[27].

I mention this case to point out Justice Matheson’s comments regarding Regulation 381/03. He acknowledges that he is not bound by Regulation 381/03 as the collision occurred in September 2001, however, he felt the need to comment on Justice Morissette’s decision in Nissan. He agrees with Justice Morissette that the law is still that of Lento v. Castaldo and that the Regulation is simply “of assistance in giving guidance to the interpretation of the Act. He then goes on to refer to the particular references in Lento v. Castaldo he felt were pivotal to the threshold analysis.

Gaukel v. Thukral

This trial was heard by Justice Arrell in July and August 2008. He released his threshold ruling in Gaukel v. Thukral[28] on September 11, 2008. The case involved a 46 year old plaintiff, married with two teenage children. As a result of the injuries she sustained in the collision, including upper back pain, neck pain and headaches, she was required to change jobs two times. She ultimately returned to full time work in a sedentary job with flexibility to move as required. No claim was presented for loss of income, past or future.

Defence counsel raised a causation issue, which Justice Arrell disagreed with based on the medical evidence presented. The plaintiff had not mentioned her pre-accident shoulder injury to her treating physicians or the defence doctor, nor did she mention them on discoveries. Her explanation was that she had the problem which resolved after treatment and no longer were a problem at the time of the accident.

Defence counsel also conducted surveillance on the plaintiff on two occasions. On one occasion she was shown raking leaves with her family and on the second she carried a heavy water jug into her house. The plaintiff testified that she would try to do as much as she could and often suffered with increased pain the days following such events. Justice Arrell rejected defence counsel’s suggestion that the plaintiff was not believable and that the court should reject her evidence regarding pain and dysfunction.

The plaintiff led evidence, together with her treating physicians, husband and close friend, that she was an active individual pre-accident. She engaged in a number of sports, including competitive soccer, boating, skiing, and activities with her children. She was responsible for inside and outdoor maintenance, meals and shopping. She had an active social life and very close marriage. The evidence revealed that the plaintiff’s life changed significantly after the accident. She had to hire people to clean her house and she was in constant pain, worse at the end of the day. She no longer played sports with her children, skied or swam lengths. She was able to vacuum the pool and resumed playing soccer, having changed her position, which she ultimately quit. She and her husband had to undergo marriage counseling for a period of time due to stresses and pain resulting from the plaintiff’s pain.

Justice Arrell accepted the evidence from the doctor’s that the plaintiff’s pain was a permanent, physical impairment. He further accepted that the plaintiff’s impairment of her upper back is an important one. Given the totality of activities that are being affected, as well as the daily pain and disturbance of sleep led Justice Arrell the conclusion that the impairment was serious. He held that the interference with the plaintiff’s enjoyment of life is “well beyond tolerable. It is serious”[29].

Of note is that Justice Arrell relied on case law to support the proposition that the court is permitted to consider the jury verdict in arriving at its own decision on the threshold issue. The jury in this case awarded the plaintiff $40,000 in general damages, and thus, accepted the evidence of the plaintiff.

Guerrero v. Fukuda

On October 1, 2008, Justice Little rendered a decision on a threshold motion in Guerrero v. Fukuda[30] involving a plaintiff who had sustained a whiplash injury as a result of the collision. Justice Little made comments regarding whiplash injuries in general. He held that “calling an expert to say that no objective finding equals no pain is no longer acceptable. The same expert will often treat the pain that exists even though it is without objective findings”. Although this collision took place before October 2003, Justice Little relied upon the definitions contained in Regulation 381/03 in coming to a conclusion on the threshold. He also referred to the comments on what constitutes a serious impairment in May v. Cascola.

In this case, the plaintiff suffered an impairment that prevented her from working full time. She was in constant pain in the upper and lower back and in intermittent pain in most other parts of her body. She made several attempts to find employment and even took a heavy truck driving course. She was only able to obtain part-time employment working at a restaurant but does so with constant pain and serious lifestyle restrictions.

Justice Little accepted the evidence of the plaintiff’s family physician fining him to have given his evidence in a straightforward manner without allowing bias to impact upon the truth. He rejected Dr. Clark’s evidence for the defence. He concluded that Dr. Clark’s “evidence was a classic example of a highly qualified doctor with a pre-existing bias, appearing as a hired gun to discredit Ms. Montero”[31].

Justice Little found the plaintiff suffered from a permanent impairment. He held that the impairment substantially interfered with most of the plaintiff’s usual activities of daily living considering her age. He held that the impairment substantially interfered with both the plaintiff’s employment and all activities of her daily life.

Keam v. Caddey

Justice Whitten was presented with a threshold motion in Keam v. Caddey[32]. He made his ruling on October 28, 2008 and found the plaintiff met the threshold. In his decision, Justice Whitten commented that “although Meyer and Bright in fact dealt with the predecessor section to the current legislation, the principles are still considered applicable and current”[33]. Regarding the analysis of the term “serious”, Justice Whitten made the following conclusion:

This analysis should not superficially focus on whether a person can perform their daily activities. The performance, per se, is not the complete question, it is more a question at what expense is this performance given the impairment. To hold otherwise would penalize those who push themselves, who have no choice but to push on, possibly given their economic situation.[34]

In this case, the plaintiff sustained injuries to his neck and shoulder. He developed post traumatic stress disorder and driver fear. Immediately following the collision there was some concern he had suffered a head injury. The medical evidence confirmed that he had ongoing cognitive difficulties, specifically with his memory and concentration. Following the accident, the plaintiff became concomitant, irritable, sleepless and angry. To support the impairments in function, plaintiff’s counsel called Mr. Keam’s wife, mother, brother-in-law and his employer. Pre-accident, the plaintiff was described as energetic, gregarious and extremely well motivated, qualities which disappeared following the collision. The medical evidence revealed that the plaintiff’s lack of concentration and pain have robbed him of the possibility of pursuing the professional career he dreamed of.

Justice Whitten held that the functions impaired by the injuries sustained were important to Mr. Keam. His intimacy with his wife had diminished. His relationship with his two infant sons is strained. His career plans have been torpedoed. While he returned to work following the collision, his employer testified that his employment was at risk due to his lack of attention to detail and his behavior is rife with anger. There was a possibility that he would have to retire early as a result. For the same reasons, Justice Whitten found that the plaintiff’s impairments were serious.

Holland v. Alfonso

The Hamilton courts were faced with another threshold motion on December 11, 2008 in Holland v. Alfonso[35]. In ruling made by Justice Festeryga, another plaintiff was found to have met the threshold. Prior to the collision the plaintiff was in excellent physical condition. He worked as a lifeguard and was an excellent swimmer. Following the accident, the plaintiff suffered from back pain, headaches, sleep problems, double vision and shoulder pain. He developed depression and anger problems. He was treated with opiates and botox injections.

Defence counsel made a causation argument. However, Justice Festeryga held that the “defendant must take the victim as he finds him”[36]. He also made comments regarding the plaintiff’s use of opiates. Justice Festeryga opined that due to the plaintiff’s age and physical condition he should have recovered within a short time. He felt that had the plaintiff not been prescribed narcotics he would not have experienced the degree of pain for the length of time he had but he did not blame the plaintiff for this. His narcotics were being prescribed by a physician and the plaintiff “is not bound to employ the most skilful surgeons who can be found or to incur lavish expenditures of any kind in obtaining treatment for injuries he has sustained”[37].

Justice Festeryga held the plaintiff’s pain was physical in nature and chronic. He found that it interfered with the plaintiff’s ability to work as a computer operator and that accommodations have to be made for him to maintain his job. The chronic pain affects his social life with respect to the interaction with his children.

Del Rio v. Lawrence

On February 18, 2009, Justice Gans made a determination that the plaintiff met the threshold in Del Rio v. Lawrence[38]. In his reasons, Justice Gans acknowledges that he is bound by Bill 59, however, he commented that “Bill 198 appears to be a codification of the principles set out by the Court of Appeal in Meyer v. Bright”[39].

Justice Gans made findings that the accident did not result in a substantial interference with the plaintiff’s ability to continue her regular employment and that the plaintiff suffers from chronic pain. The analysis focused, therefore, on whether the plaintiff’s enjoyment of life was seriously affected. The evidence before the court was that the plaintiff’s usual activities of daily living outside of work had been curtailed markedly. She returns from work unable to do anything but lie down as a result of pain. Accordingly, Justice Gans held that the plaintiff’s condition substantially interfered with her quality of life and continued to do so. Of note is that on cross-examination, Dr. Soric responded positively to the following question: “and would you agree with me Doctor, that symptoms like neck pain, intermittent occipital headaches, pain in the left shoulder, low back pain, depression, lack of sleep would affect this woman’s quality of life?”.[40]

The court then considered the issue of permanency. Defence counsel argued that since there was no evidence of physiatrist or psychiatrist/psychologist on this issue then this element was not proven by the plaintiff. Dr. Ogilvie-Harris did give evidence that the condition would persist. Justice Gans was not persuaded that a plaintiff suffering from chronic pain was obligated to lead evidence from a physiatrist or a psychologist/psychiatrist in support of the issue of permanence. He accepted the evidence of Dr. Ogilvie-Harris who he felt was well versed in the diagnosis and treatment of chronic pain syndrome, but did find that it would have been prudent for the plaintiff to at least lead this evidence given the case law that suggests that the absence of such evidence could be fatal to a threshold motion.

The jury awarded $22,500.00 in general damages and $1,940.46 for past loss of income.

Xiao v. Gilkes

The most recent Bill 59 threshold decision was given by Justice MacDonnell on February 24, 2009 in Xiao v. Gilkes[41]. In this case, the plaintiff suffered injuries to his neck, shoulder and back. He received three months of chiropractic care and was under the care of his doctor for approximately 14 months. Prior to the collision the plaintiff was working 60 hours per week. He was forced to reduce his hours post-accident.

The plaintiff was involved in a second accident eighteen months following the first. He suffered an exacerbation of his neck and back injuries. There is no evidence that the plaintiff saw any doctors between November 2002 and November 2006 when he had a medical legal assessment. The plaintiff was back to work full-time, 60 hours a week, without interruption in his pre-accident capacity by January 2005. The plaintiff argued that he continued to suffer from chronic pain which impaired his ability to perform his duties as a chef and to engage in the daily activities he engaged in prior to being injured.

Defence counsel argued that the plaintiff was faking his condition and that he did not have a serious impairment of his ability to work or carry out his daily activities. There, of course, were conflicting expert opinions on the issue. The plaintiff alleged that the physical function impaired was the ability to bend at the waist, to lift heavy objects, and to stand for extended periods of time. There is no doubt that these functions are important to the plaintiff as a chef. Justice MacDonnell also found that the plaintiff’s impairment caused a substantial interference with his ability to carry out his duties at work on a full time basis and to participate in the daily activities of his life and, therefore, that it was serious. However, he was not satisfied that the impairment was permanent. Justice MacDonnell was of the opinion that the plaintiff was not a credible witness as he had difficulty maintaining a consistent account of the relevant history and was dishonest regarding reporting his income to Revenue Canada. He declined to give any weight to Dr. Finklestein’s opinion on behalf of the plaintiff.

Conclusion

In my opinion, there has been no change to the analysis of the threshold based on the definitions in the regulation. The definitions set out in the regulation simply provide more guidance to the judiciary in making their decisions on threshold motions. Of the above Bill-198 cases that did not meet the threshold, it would be hard to say that any of them would have met the threshold pre-Bill 198 given the credibility issues and lack of proper evidence. Most telling is that in looking at most pre-Bill 198 cases in the last year the judges have looked at all of the same issues in their analysis of the threshold. They consider the medical evidence, the activities engaged in pre-accident and how those have been impacted post-accident, whether or not there were accommodations made or sought in employment, treatment efforts, the permanence of the impairment and what functions have been impaired and how important they are to the plaintiff. Looking at the regulation, these are the same considerations that should be made in a Bill-198 analysis.

As plaintiff’s counsel, the following comments are being made from that perspective and which I hope will be helpful to plaintiff’s counsel in preparing their cases in light of the decisions post Nissan. I do not believe that Plaintiff’s counsel should approach their cases any differently. Most counsel will have put forth the same evidence and prepared their case pre-Bill 198 as they would now. Prepare your case from the get-go and ensure that you are aware of any potential credibility issues. Ensure your doctors are properly prepared with respect to pre-accident history and the definitions in the regulation. Plaintiff’s counsel will to have to ensure that they have sufficient evidence to meet the test set out in the regulation. The cases referenced above illustrate the importance of collateral witnesses as to the inability to engage in daily activities, especially in cases where the plaintiffs continue to work.

Oftentimes, and as evidenced in the history of threshold decisions over the years, the cases that go to trial are those that have serious credibility issues or where sufficient evidence has not been adduced pre-trial. Do not give the insurance companies the chance to question credibility. Attempt to give them all of the medical evidence as far in advance as possible. Where the plaintiffs have returned to work, ensure to compile as much evidence as to the inability to engage in usual activities as possible and ensure that the plaintiff has sufficiently attempted to accommodate him or herself in the workplace. What I find is that a failed work attempt is the most telling evidence of the inability to work.

Given the Nissan decision, and the cases that followed, it is likely that the courts will continue to form their analysis based on the approach taken in Meyer v. Bright and consideration of the pre-Bill 198 cases, taking guidance from the definitions set out in Regulation 381/03.

For more information of our services see Motor Vehicle Collisions at www.FlashLaw.ca

SCHEDULE “A”

Definition of Permanent Serious Impairment of an Important Physical, Mental or Psychological Function

4.1 For the purposes of section 267.5 of the Act,

“permanent serious impairment of an important physical, mental or psychological function” means impairment of a person that meets the criteria set out in section 4.2. O. Reg. 381/03, s. 1.

4.2 (1) A person suffers from permanent serious impairment of an important physical, mental or psychological function if all of the following criteria are met:

1. The impairment must,

i. substantially interfere with the person’s ability to continue his or her regular or usual employment, despite reasonable efforts to accommodate the person’s impairment and the person’s reasonable efforts to use the accommodation to allow the person to continue employment,

ii. substantially interfere with the person’s ability to continue training for a career in a field in which the person was being trained before the incident, despite reasonable efforts to accommodate the person’s impairment and the person’s reasonable efforts to use the accommodation to allow the person to continue his or her career training, or

iii. substantially interfere with most of the usual activities of daily living, considering the person’s age.

2. For the function that is impaired to be an important function of the impaired person, the function must,

i. be necessary to perform the activities that are essential tasks of the person’s regular or usual employment, taking into account reasonable efforts to accommodate the person’s impairment and the person’s reasonable efforts to use the accommodation to allow the person to continue employment,

ii. be necessary to perform the activities that are essential tasks of the person’s training for a career in a field in which the person was being trained before the incident, taking into account reasonable efforts to accommodate the person’s impairment and the person’s reasonable efforts to use the accommodation to allow the person to continue his or her career training,

iii. be necessary for the person to provide for his or her own care or well-being, or

iv. be important to the usual activities of daily living, considering the person’s age.

3. For the impairment to be permanent, the impairment must,

i. have been continuous since the incident and must, based on medical evidence and subject to the person reasonably participating in the recommended treatment of the impairment, be expected not to substantially improve,

ii. continue to meet the criteria in paragraph 1, and

iii. be of a nature that is expected to continue without substantial improvement when sustained by persons in similar circumstances. O. Reg. 381/03, s. 1.

(2) This section applies with respect to any incident that occurs on or after October 1, 2003. O. Reg. 381/03, s. 1.

Evidence Adduced to Prove Permanent Serious Impairment of an Important Physical, Mental or Psychological Function

4.3 (1) A person shall, in addition to any other evidence, adduce the evidence set out in this section to support the person’s claim that he or she has sustained permanent serious impairment of an important physical, mental or psychological function for the purposes of section 267.5 of the Act. O. Reg. 381/03, s. 1.

(2) The person shall adduce evidence of one or more physicians, in accordance with this section, that explains,

(a) the nature of the impairment;

(b) the permanence of the impairment;

(d) the importance of the specific function to the person. O. Reg. 381/03, s. 1.

(3) The evidence of the physician,

(a) shall be adduced by a physician who is trained for and experienced in the assessment or treatment of the type of impairment that is alleged; and

(b) shall be based on medical evidence, in accordance with generally accepted guidelines or standards of the practice of medicine. O. Reg. 381/03, s. 1.

(4) The evidence of the physician shall include a conclusion that the impairment is directly or indirectly sustained as the result of the use or operation of an automobile. O. Reg. 381/03, s. 1.

(5) In addition to the evidence of the physician, the person shall adduce evidence that corroborates the change in the function that is alleged to be a permanent serious impairment of an important physical, mental or psychological function. O. Reg. 381/03, s. 1.

(6) This section applies with respect to any incident that occurs on or after October 1, 2003. O. Reg. 381/03, s. 1.

5. Revoked: O. Reg. 381/03, s. 2.

[1] R.S.O. 1990, c.I-18. [2] (1993), 15 O.R. (3d) 129, (1993), 110 D.L.R. (4th) 354 (ON C.A.) [3] (2008), 62 C.C.L.I. (4th) 135, 2008 CarswellOnt 2520 (Ont. S.C.J.) [4] Toronto: Butterworths, 1994 [5] Supra note 3 at para. 14 [6] Ibid at para. 37 [7] Ibid at para.38 [8] Unreported, Court File #05-CV-32474 (Ont. S.C.J.) [9] Ibid. [10] As an aside, at trial the jury found no liability on the basis of an inevitable accident defence. The Plaintiff is appealing the jury verdict on liability and damages and it is anticipated that the Defendant, will appeal the threshold defence. [11] [2008] O.J. No. 5322, 2008 CarswellOnt 7969 (Ont. S.C.J.) [12] Ibid at para. 86 [13] Unreported, Court File #50810 (Ont. S.C.J.) [14] Ibid at para. 11 [15] [2006] O.J. No. 4227 (Ont. S.C.J.) [16] [2004] O.J. No. 4315 (Ont. S.C.J.) [17] Supra note 13, at para. 19 [18] Ibid at para. 21 [19] Ibid at para. 31 [20] [2003] 2 S.C.R. 504 [21] 2009 CarswellOnt 604 (Ont. S.C.J.) [22] Ibid at para. 9 [23] Ibid at para. 11 [24] (2008), 90 O.R. (3d) 34, 2008 CarswellOnt 1685 [25] Ibid at para. 7 [26] 2008 CarswellOnt 3089 (Ont. S.C.J.) [27] Ibid at para. 21 [28] Unreported, Court File No.CV-03-2321 (Ont. S.C.J.) [29] Ibid at para. 51 [30] 2008 CarswellOnt 5706 (Ont. S.C.J.) [31] Ibid at para. 24 [32] Unreported, Court File No. 12444/04 (Ont. S.C.J.) [33] Ibid. [34] Ibid. [35] Unreported, Court File No. 01-4642 (Ont. S.C.J.) [36] Ibid. [37] Ibid. [38] 2009 CarswellOnt 851 (Ont. S.C.J.) [39] Ibid at para. 3 [40] Ibid at para. 9 [41] 2009 CarswellOnt 924 (Ont. S.C.J.)

Reservists gaining ground

Tue, 10 Aug 2010 14:47:07 GMT

Steve Arnold – The Hamilton Spectator;

The last thing a Canadian soldier in Afghanistan should have to think about is keeping a job back home.

The Hamilton Chamber of Commerce wants to give that comfort to the country’s reserve soldiers when they’re called into action. In a policy proposal, the business lobby group calls on the federal government to establish a system of tax incentives and other inducements to entice businesses to hold jobs of reservists and make up some of the difference between their military and civilian paycheques.

“We’re doing this because we all realized it’s important to support our reserves who are putting their lives at risk with no assurance their jobs will be there when they get back,” said chamber CEO John Dolbec. “It’s the right thing to do. The government is saving a pile of money by using reservists rather than regular force soldiers.”

Today, 29,000 men and women serve in Canada’s military reserves and about half of them have full- or part-time civilian jobs. They often must use their vacation time for weekends and other times they spend training. Those who volunteer for active duty often face the choice of taking a pay cut or even quitting a job. The only legal protection they have is a law requiring employers to hold their jobs if they’re called out in a general emergency.

Lawyer Lawrence Hatfield faced that last year. A part-time soldier for 18 years, he serves today as a major in the Argyll and Sutherland Highlanders in addition to working with the city’s Morris Law Group. Making his dream of a tour of active duty possible required some serious sacrifices.

His wife, Shari, quit her legal job to take over his practice for the 10 months he was in uniform. That income, plus the salary and allowances he received while in the field, still meant a significant pay cut for a family with two small children.

“There’s no question I lost money because of this, but I just couldn’t stand sitting on my butt and watching the difficulties the troops in Afghanistan were having,” he said.

The experience was different for Geoff Van Ginkel, a corporal in the Royal Hamilton Light Infantry and a security guard with Securitas Canada in civilian life. He got a pay raise to go to Afghanistan.

“When I was chosen to go, I just e-mailed my boss and said this is when I’m leaving and this is when I’ll be back and there was no trouble,” he said. “He was quite supportive about this, but usually I have trouble getting the weekends off that I need for training exercises. That’s kind of frustrating.”

The time requirements of a reservist vary by unit and job. For the Argylls, it’s one night a week, one weekend a month and one week in the summer for basic duties, plus special courses.

Public policy changes being sought by the Chamber of Commerce still fall short of legal protections provided in the United States, where federal law protects the jobs of reservists on active duty for up to five years. First, though, the U.S. defence department appeals to patriotism and a company’s desire for good exposure.

“We tell them that when they hire reservists, they’re getting a workforce that’s trained and disciplined and that makes them a valued commodity,” said spokesperson Lieutenant Colonel Les’ Melnyk. “We also educate, inform and reward the best employers.”

The Canadian Forces Liaison Council is making similar efforts. Earlier this year, it gave WestJet Airlines an award as top employer in Ontario for supporting reservists. “We really believe this is the right thing to do and that reservists are people who really want to serve their country,” said Ken McKenzie, a WestJet executive.

Proposals by the Hamilton chamber include tax incentives to encourage employers to top up pay of reservists for tours lasting up to three weeks, and to give reservists a pro-rated amount of time off so they don’t have to use their vacation time to serve the country.

sarnold@thespec.com

http://www.thespec.com/article/212838

[Posted as general interest by the persoal injury lawyers of Flaherty Sloan Hatfield, Hamilton ON.]

Motor Vehicle Inusrance Benefits Dramatically Reduced

Thu, 22 Jul 2010 14:48:10 GMT

Recent changes to the Insurance Act and the Regulations thereunder are gutting benefits in Ontario effective September, 2010. These dramatic changes will reduce medical, rehabilitation, and income replacement benefits to levels not seen in over 20 years taking inflation into account. Many benefits are being eliminated completely.

As personal injury lawyers we see this affecting our clients immeasurably.

While owners of motor vehicles will be permitted the option of purchasing some extended benefits, pedestrians and other innocent accidents victims who do not have insurance will see their entitlement to necessary benefits slashed or eliminated.

After years of record profits, the Insurance Inustry has convinced the Provincial Government once again to reduce coverage in the interest of industry income.

The full extent of these changes is not fully known at this time. Keep tuned and we will update you as more information is received. Updates will appear in our Industry News category.

Steve Sloan Pannelled Speaker at Insurance Conference

Tue, 15 Jun 2010 14:49:45 GMT

Hamilton, Ontario Plaintiff personal injury lawyer, Stephen Sloan, attended the Spring 2010 Conference of the Canadian Society of Medical Examiners as a guest panelist to discuss the topic of chronic pain. Joining Steve on the panel were Ontario Superior Court Justice Salhany (ret.), Mr. George Cooke, President and CEO of Dominion of Canada Insurance Company, and Mr. Lee Samis, of Samis and Company, a well-known and respected defence lawyer. For approximately 2 hours, the panelists engaged in a robust discussion and were asked questions regarding the current treatment of chronic pain in both law and medicine.

Brain Injury Run a Success

Thu, 10 Jun 2010 14:51:20 GMT

On June 19th, 2010, Flaherty Sloan Hatfield was pleased to sponsor the 5th annual Hamilton Brain Injury Association Walk and Run. The events were held on Discovery Drive in Hamilton. It was a beautiful day with fun had by all. For more on the legal services pertaining to brain injuries call or visit Flaherty Sloan Hatfield today.