December 15, 2017, Kitchener, Ontario
Posted by: Robert Deutschmann, Personal Injury Lawyer
Cariati and Wawanesa
Decision Date: November 1, 2017
Heard Before: Adjudicator Alan Smith
ENTITLEMENT TO IRBs and BENEFITS: IRBs not qualified for on the basis of payments from family owned corporation; benefits shown to be reasonable and necessary are approved
Mihaela Cariati was hurt in a car accident on March 5, 2014, and sought accident benefits from Wawanesa but when mediation failed she applied for arbitration at the FSCO.
- Is Mrs. Cariati entitled to receive a weekly IRBs of $400 from one week post-accident to date and ongoing?
- Is Mrs. Cariati entitled to receive ACBs in the amount of $3,000.00 per month from March 5, 2014, to March 5, 2016?
- Is Mrs. Cariati entitled to receive medical benefits as follows:
- $5,980.75 for rehabilitative coaching?
- $1,129.30 for assistive devices?
- $3,961.66 for occupational therapy treatment?
- $703.41 for assistive devices?
- $1,197.12 for physiotherapy (mobilization?
- Is Mrs. Cariati entitled to receive the costs of examinations as follows:
- $1,510.61 for an attendant care?
- $1,522.63 for a follow up attendant care assessment?
- $1,615.00 for a nutritional assessment?
- $2,000.00 for a speech language assessment?
- Is Mrs. Cariati entitled to interest for the overdue payment of benefits?
- Is Wawanesa liable to pay a special award because it unreasonably withheld or delayed payments to Mrs. Cariati?
- Mrs. Cariati is not entitled to receive a weekly IRBs.
- Mrs. Cariati is not entitled to receive ACBs.
- Mrs. Cariati is entitled to medical benefits set out below:
- $5,980.75 for rehabilitative coaching
- $3,961.66 for occupational therapy treatment
- $1,197.12 for physiotherapy (mobilization).
- Mrs. Cariati is not entitled to medical benefits set out below:
- $1,129.30 for assistive devices
- $703.41 for assistive devices
- Mrs. Cariati is entitled to the cost of an examination as follows:
- $1,615.00 for a nutritional assessment
- Mrs. Cariati is not entitled to the cost of examinations as follows:
- $1,510.61 for an attendant care assessment
- $1,522.63 for a follow up attendant care assessment
- $2,000.00 for a speech language assessment
- Mrs. Cariati is entitled to interest for the overdue payment of benefits.
What is germane to this decision is Mrs. Cariati’s testimony with regard to the reasonableness and necessity of medical benefits and examinations. Mrs. Cariati testified that her physiotherapy sessions helped to relieve the symptoms she suffered post-accident including headaches, numbness in her pelvic area and legs, vertigo, depression, sleeplessness and panic attacks. She also testified that since the accident she had experienced a weight loss of 25 or 30 pounds due to nausea and lack of appetite. She testified that she had found that working with a rehabilitative coach was helpful. However, in cross-examination Ms. Cariati admitted that she did not wish to use assistive devices, as recommend by her occupational therapist, because she believed the use of such devices would make her “look old”.
Mr. Cariati testified that rehabilitative coaching was of great assistance to his wife post-accident. He also stated that Mrs. Cariati had some difficulties with her speech after the accident i.e., that she often speaks “gibberish”.
Ms. Cariati was an employee of the family corporation. With relevance to the issues before the Tribunal an accountant clearly testified that if the post-accident funds provided to the service provider were indeed deductible, pursuant to the Schedule s. 7(3)(a), as explained below, Ms. Cariati would not be entitled to income replacement benefits as claimed.
The Arbitrator reviewed much of the medical testimony and determined that Ms. Cariati had not met threshold requirements of the Schedule to qualify for attendant care. She had not demonstrated the reasonableness and necessity of medical benefits and examinations
The Arbitrator then turned to the question of IRBs. Given that Ms. Cariati had been paid funds post accident by the family corporation the Arbitrator was left to determine if they are deductible from Income Replacement Benefits? The Arbitrator reviewed the decision in Bapoo, and agreed that in the present context the logic in Bapoo should be followed i.e., just as monies withheld by a third party and remitted directly to the Canada Revenue Agency could be interpreted as “received” by the taxpayer, in the present context the word “received” should be interpreted broadly to include the funds transferred for the benefit of Ms. Cariati, from the company to Ms. Cariati’s service provider. The fact that the funds in question may have been paid by her husband, as her de facto agent, directly to the service provider is irrelevant. The Arbitrator found that the post-accident monies were indeed “received” by Mrs. Cariati pursuant to section 7(3)(a) of the Schedule.
The second question to be answered is whether the post-accident funds provided by the company should be characterized as employment income pursuant to s. 7(3)(a) of the Schedule. The Arbitrator reviewed the law and determined that Wawanesa bears the onus of establishing that an insured has received income in respect of employment subsequent to the accident; and that an insured person's income tax returns are prima facie proof of income, but they are not conclusive of the issue of whether payments received are indeed employment income. The insured person bears the onus to present reliable and cogent evidence to overcome the prima facie presumption.
At the hearing of this matter Ms. Cariati called an accountant with expert knowledge of the Schedule. Mr. Wallach clearly testified that if the post-accident funds provided to the service provider were indeed deductible pursuant to the Schedule, s. 7(3)(a), Ms. Cariati would not be entitled to income replacement benefits as claimed. Having found that the funds in question are deductible, Ms. Cariati’s claim for income replacement benefits is dismissed.
For Ms. Cariati to be entitled to the attendant care benefits, Ms. Cariati must establish that she “incurred” the attendant care costs as defined under s. 3(7)(e) of Schedule. Therefore, according to the criteria provided in the Schedule, the attendant care services must have been provided by a professional attendant care service provider during the course of their ordinary employment or the person providing the service would have to have suffered an economic loss.
It is common ground that no one suffered an economic loss providing services to Mrs. Cariati. Therefore, the first question to be answered is whether the service provider, meets the criteria set out in Schedule s. 3(7)(e)(iii)(A) i.e., that she provided the services to Ms. Cariati post-accident, “in the course of the employment, occupation or profession in which he or she would ordinarily have been engaged, but for the accident. Prior to the accident, the service provider was not employed for remuneration as a PSW or healthcare aide. There is no evidence she was actively seeking such employment or likely to receive an offer for such employment.
On this basis the Arbitrator determined that the service provider would not ordinarily have been engaged in healthcare services employment but for this accident.
As the people helping Ms. Cariati did not provide services to Ms. Cariati, “in the course of the employment, occupation or profession in which he or she would ordinarily have been engaged, but for the accident”. Given that there is also no evidence of Mrs. Cariati has failed to satisfy the criteria contained in section 19(3) of the Schedule.
The Arbitrator then reviewed the medical evidence and the application for benefits and determined that Wawnesa’s conclusion that Mrs. Cariati suffered no physical impairment as a result of the accident is not supported by the overwhelming medical evidence called at the Hearing, and filed into evidence; Further, this conclusion is not supported by Wawanesa’s own medical evidence which confirmed on physical testing that Mrs. Cariati not only had deficits in her strength and range of motion, but that she had a loss of sensation in her lower extremities, which he confirmed on objective testing. On this basis those treatments show to be reasonable and necessary are approved.