January 6, 2014

SABS Update – Long Lived Scarlett v. Belair – MIG Appeal decision will lead to bizarre results

For the week of January 6 to January 10, 2014

Belair Insurance Company v. Scarlett, Appeal P13-00014, November 28, 2013, Director’s Delegate David Evans

MVC: September 18, 2010. The Insured suffered soft tissue injuries, chronic pain, depressive symptoms and temporomandibular joint dysfunction (“TMJD”). The Insurer concluded that the Insured’s injuries fell within the Minor Injury Guideline (“MIG”) and is therefore subject to the $3,500 limit for minor injuries. Arbitrator Wilson found that the Insured’s chronic pain, depressive symptoms and TMJD were separate from his soft tissue injuries and were not the sequelae thereof. Arbitrator Wilson also made the following legal conclusions:

Once the insured provides compelling evidence that the injuries fell outside of the MIG, the burden of proof shifts to the insurer to show that the insured was subject to the MIG;

“Compelling evidence” simply means credible evidence; and

The MIG is a non-binding interpretative aid in deciding whether an insured comes within the MIG.

The Insurer appealed seeking an order that the Insured is subject to the limit, or that a new arbitration hearing be ordered before a different arbitrator.

ANALYSIS

Section 3(1) of the Statutory Accident Benefits Schedule – Effective September 1, 2010 defines “minor injury” as follows:

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

Director’s Delegate Evans noted that Arbitrator Wilson failed to address, as he should have, why he thought the Insured’s chronic pain, depressive symptoms and TMJD were separate and distinct from the soft tissue injuries and not “clinically associated sequelae” to his minor injuries. Director’s Delegate Evans disagreed with Arbitrator Wilson’s legal conclusions and articulated the law as follows:

 The burden of proof always rests on the insured of proving that he or she fits within the scope of coverage;

 “Compelling evidence” means more than credible evidence: the evidence has to be “compelling” or “probant”;

The MIG is incorporated into the Statutory Accident Benefits Schedule and is therefore binding.

Director’s Delegate Evans held that even if some injuries are not clinically associated sequelae, an insured is still subject to the limit for medical and rehabilitation benefits if the impairment is predominantly a minor injury; the relevant test is whether the impairment is predominantly a minor injury, not simply whether any particular injury is a minor injury. He noted that the determination of whether or not an insured is subject to the MIG will often involve determinations of credibility, disputed factors or conflicting medical reports and therefore, he would discourage preliminary issue hearings on the MIG in the future.

Director’s Delegate Evans also found that the Arbitrator’s research and reliance on cases and statutory provisions he raised on his own accord after the arbitration hearing, without notifying the parties and allowing the parties an opportunity to respond, was a breach of procedural fairness. Director’s Delegate Evans ultimately allowed the appeal, rescinded Arbitrator Wilson’s decision, and remitted the matter to a full hearing on all issues in dispute before a different arbitrator.

IMPLICATIONS

Scarlett v. Belair is called into question by this decision. Director’s Delegate Evans has interpreted the Regulation in a manner at odds with the more liberal direction the courts have taken, in particular the Court of Appeal, in recent cases. See for example the Court of Appeal’s interpretation of economic loss sufficient to allow a family member to receive Attendant Care benefits. Director’s Delegate Evans has significantly changed the nature of the assessment without giving any guidance on what is “predominant” and the criteria for assessing same.  His interpretation will lead to absurd and conflicting results; for example, an insured  who sustains TMJD in addition to MIG injuries will have access to $3,500 in treatment, whereas an insured who already had TMJD before the collision and sustains MIG injuries will have access to $50,000, or one with only TMJD will have access to $50,000.

If you have questions or comments about this post, contact info@md-lawyers.ca