October 28, 2010 by Canadian Underwriter
Percentage determinations of psychological impairments cannot be added to percentage determinations of physical impairments to determine whether or not a person has suffered a whole person ‘catastrophic impairment’ under the Statutory Accidents Benefits Schedule (SABS), the Ontario Superior Court of Justice has found.
S. 43, Clause 2(1.1)(f) of the SABS states a person has suffered a catastrophic injury if: “an impairment or combination of impairments…in accordance with the American Medical Association’s Guides to the Evaluation of Permanent Impairment, 4th edition, 1993, results in 55 per cent or more impairment of the whole person.”
Courts and arbitrators are frequently asked to combine percentage-based determinations of physical and psychological impairments to arrive at a conclusion that a person had met the 55% threshold of a catastrophic impairment.
But in Kusnierz v. The Economical Mutual Insurance Company, released on Oct. 19, 2010, the Ontario Superior Court says this type of combination of psychological and physical impairments cannot be done.
“I find that it is not permissible under the SABS to assign percentage values to mental and behavioural disorders under Chapter 14 of the Guides…and then combine them with the percentage values derived from impairments assessed under the other chapters of the Guides (referred to in clause 2(1.1)(f) of the SABS) in determining whether an individual meets the catastrophic impairment threshold of “55 per cent or more impairment of the whole person,” Ontario Superior Court Justice Peter Lauwers wrote in his decision.
“I reach this conclusion for the following reasons, in a nutshell:
“(i) The Guides deliberately do not permit the mental and behavioural disorders in Chapter 14 to be assessed in percent terms and combined with the percentage values derived from impairments assessed under the other chapters of the Guides for the purpose of determining whole person impairment;
(ii) The structure of the SABS reinforces the bright line demarcation between mental and behavioural disorders referred to in Chapter 14 of the AMA Guides – specifically referred to in clause 2(1.1)(g) of the SABS – from the impairments assessed under the other chapters of the Guides which are referred to in clause 2(1.1)(f) of the SABS; and
(iii) This interpretation is consistent with the purpose of the specific provisions of Bill 59 and the SABS that this issue engages.”
George Cooke, president and CEO of The Dominion of Canada General Insurance Company, praised the ruling during the Insurance Brokers Association of Ontario (IBAO)’s 90th Annual Convention in Niagara Falls. But it does seem likely, based on the importance of the ruling to the industry, that the decision will be appealed.