Nanny Expenses Can Be Paid Separate From a Caregiver Benefit

May 04, 2008, Kitchener, Ontario

Posted by: Robert Deutschmann, Personal Injury Lawyer

Superior court decision before Justices Lane, McCombs and Sedgwick

Decision date:  January 8, 2008

G.B. sought judicial review of an appeal decision at the Financial Services Commission of Ontario (FSCO) which denied her access to nanny services to assist in the caring of a child that was born after her car accident.

G.B. suffered serious injuries in a car accident that occured on August 28, 1998.  Her injuries included fractures to her right forearm, right leg and heel and facial, jaw and dental injuries.  She applied for and was approved for accident benefits through Pilot Insurance.  She was single and had no children at the time of the accident.  She later married and gave birth to a daughter on April 20, 2004.

A Future Care Costs report, arranged by Pilot Insurance in October 2001, noted that in the future G.B. might need the services of a nanny to help her care for a child since she was unable to perform some of the physical activities necessary to care for a young child.  The report predicted that the need would be for 5 years covering the care of two children to age 3.  The annual cost was estimated to be $25,800.00.  The report concluded that the nanny services were necessary to allow G.B. to maximize her ability to function, to compensate for physical child care needs that G.B. was unable to complete and that these needs resulted fro mthe injuries sustained in the car accident.

On November 2, 2004, G.B. submitted a treatment plan to Pilot for nanny services to help her care for her child.  The plan was prepared by a registered nurse and referred to the problems arising from the fractures of the right radius and the ulna as inhibiting the handling of the baby.  Pilot denied the treatment plan as being not reasonable and necessary and further that G.B. was not deemed to be catastrophically impaired.  An independent Designated Assessment Centre (DAC) concluded that 50 hours of nanny services weekly for 6 to 12 months, to be reviewed, was reasonable and necessary for G.B. to ensure safe care of her child.  Pilot refused to accept the DAC conclusion on the basis that G.B. was not entitled to the benefits based on the language of the SABs.

G.B. commenced an arbitration proceeding and was successful in obtaining an interim order requiring Pilot to pay nanny expenses until the final arbitration.  The issue of catastrophic impairment was again raised by Pilot but in March, 2006, G.B. was found to be catastrophically impaired.  The decision was challenged by Pilot but the appeal was dismissed in September 2007.

At the initial arbitration hearing, Pilot had argued that child care came under s.13 (caregiver benefits) of the Statutory Accident Benefits Schedule (SABS) and therefore could not be obtained under s.15 (medical and rehabilitation benefits).  Pilot argued that there could be double dipping.  The arbitrator rejected these submissions.  The arbitrator found that the proposal for nanny services came under s.15 for medical and rehabilitation expenses.  The treatment plan met all the requirements of s.15 and the DAC found that the expenses were reasonable and necessary "other services" as provided under s.15.  Further, the purpose of the nanny services was to reduce or eliminate the disability resulting from the accident and to facilitate the reintergration into G.B.´s family.  The arbitrator did not accept that s.13 was the exclusive basis for caregiving expenses.  Section 15 only excludes case manager services and the provision for "other goods and services" in s.15 allows for a broad interpretation.  In addition, there was a report from a neuropsychologist which stated that the childcare assistance would allow G.B. to have to focus on rehabilitation.  The report also noted that the childcare assistance was part of a broader rehabilitation program.  The arbitrator also noted that this benefit was time limited and to assist G.B. through a particularly difficult time.

Pilot appealed the arbitrator´s decision to support the nanny expenses as reasonable and necessary.  The focus of the appeal was whether nanny expenses could be recovered as a rehabilitation benefit under s.15.  The Director Delegate, at the appeal, speculated that the failure to exclude nanny expenses under s.15 does not imply they are included when one considers that the drafters of the legislation likely considered s.13 to cover such expenses.  The Director´s Delegate was not convinced that s.15 was intended to pay for nanny services for a mother who is unable to care for her child due to injuries arising from an accident since child care expenses are covered under s.13 and s.28 (provides optional dependant care benefits for working mothers).

The judge panel at Superior court rejected the analysis and decision of the Director Delegate and reinstated the decision of the arbitrator and approved the nanny expenses.  The court noted that s.15 deals with rehabilitation of the injured person herself while s.13 provides for an allowance to replace caregiving services which were provided by the injured person at the time of the accident.  The circumstances for the expenses and the terms on which payment are made are very different between the two sections.  The court noted that ther is no necessary or logical inference that because such expenses can be obtained pursuant to one section of the SABS, they could not be obtained in a different set of circumstances under a different seciton of the SABS.  The court specifically stated that any recovery is subject to the commense sense rule that the same expense will not be recovered twice.

The court also noted that the Director Delegate did not seem to take into account the finding of fact by the Arbitrator that provision of nanny services had a rehabilitative purpose for G.B.  The court was of the view that these findings of fact were very important in that it would eliminate the pssiblity of the use of the court´s decision to fund nanny expenses as a precedent to the wholesale funding of child care expenses circumventing s.13.  The court specifically noted that in this case the nanny expenses were for G.B.´s rehabilitation and not to fund child care.

Clearly the key in this decision was the medical evidence that showed that nanny expenses were necessary and reasonable for G.B.´s rehabilitation.  This is a fact specific determination and will not result in the flood of applications attempting to get around s.13. The court also noted that the intention of the Legislature was to construe s.15 and "other goods and services" as broadly as the needs of the claimant for rehabilitation requires.

Posted under Accident Benefit News, Automobile Accident Benefits, Car Accidents, Catastrophic Injury, Disability Insurance, Treatment

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