Simser v. Aviva.

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The Appeal decision in Simser v. Aviva (Appeal P13-00004) was recently released by the Financial Services Commission of Ontario (FSCO) on January 9, 2014. 

The appeal concerned clause 3(7)(e) of the Statutory Accident Benefits Schedule — Effective September 1, 2010. O. Reg. 34/10, s. 1 (the “Schedule”).  Clause 3(7)(e) states that an expense in respect of goods or services referred to in the 2010 Schedule is not incurred by an insured person unless:

  1. the insured person has received the goods or services to which the expense relates,
  2. the insured person has paid the expense, has promised to pay the expense or is otherwise legally obligated to pay the expense, and
  3. the person who provided the goods or services,
    1. 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
    2. sustained an economic loss as a result of providing the goods or services to the insured person; (emphasis added).

In Simser v. Aviva, the issue was whether a non-professional service provider providing attendant care services could satisfy the definition of “incurred” pursuant to section 3(7)(e)(3)(ii) of the Schedule, by showing that they had incurred an “economic loss” in providing the services.

At Arbitration, Mr. Simser submitted an opinion report by an economist which interpreted an economic loss as extending beyond “mere financial and monetary loss” to “loss of time devoted to labour or leisure” as well as lost opportunity.  He argued that this would satisfy the definition of “incurred” in the Schedule.

However, Arbitrator Lee rejected this perspective in favour of the ordinary, everyday definition of “economic loss” which requires a financial, monetary or wage loss. He opined that broadening the definition of economic loss would remove the distinction between professional and non-professional care providers and overlook legislative intent behind the amendments to the new Schedule.  Arbitrator Lee noted that Mr. Simser’s attendant care providers proffered no quantifiable documentation of economic loss to support their alleged decrease in income, loss of working hours, or loss of overtime.  

Mr. Simser appealed Arbitrator Lee’s decision.

On Appeal, Director’s Delegate Blackman confirmed Arbitrator Lee’s decision. 

Director’s Delegate Blackman noted that both parties agreed that during the period in dispute, Mr. Simser did receive the services relating to attendant care and for housekeeping and home maintenance.  As such, Mr. Simser had met the first part of the definition of “incurred.” 

Mr. Simser had also paid or had promised to pay for the services, thus meeting the second part of the “incurred test”, set out in subclause 3(7)(e)(ii).

However, at issue was whether Mr. Simser could meet the third part of the “incurred” test and prove that his service providers had sustained an economic loss as a result of providing the attendant care and housekeeping/home maintenance services to him.

On Appeal, Mr. Simser argued that the Legislature did not define economic loss, and as such, it could be reasonably inferred that it left it open to be defined broadly and to include any pecuniary loss. Mr. Simser argued that while his wife continued to work at her regular job while providing attendant care and housekeeping services for him, she was required to leave work at various times during the day, losing five to ten hours of work per week with a consequent financial or monetary loss.  However, at Arbitration, Arbitrator Lee had found that Julie Simser’s alleged losses of income were unspecific, unsubstantiated, unquantifiable, abstract or hypothetical and that she had provided no substantiating documentation from her workplace regarding her claimed loss.

On Appeal, Director’s Delegate Blackman agreed that there was no basis for overturning the Arbitrator’s finding that Mr. Simser had not met his evidential onus of establishing that Ms. Simser sustained an economic loss in the form of lost wages as a result of providing these services.

Mr. Simser thereafter argued that Ms. Simser had sustained “less tangible forms of financial or monetary losses” in providing these attendant care and housekeeping services, such as “loss of time”.  He argued that this was also a monetary or financial loss sufficient to meet the requirements of the legislation. Mr. Simser argued that it would be discriminatory not to compensate spouses, relatives and other non-professionals for their services. However, Director’s Delegate Blackman disagreed.  He reiterated that it was Mr. Simser who had the onus of proof. In addition, as stated in Henry v. Gore, Director’s Delegate Blackman held that economic loss was not a measure or factor in quantifying the amount of reasonable and necessary benefits to be paid by the insurer:

The provision of services is the provision of time. I agree with the Arbitrator that to adopt Professor Carr’s definition of economic loss to include taking time away from seeing movies, knitting, crocheting, going out with friends or any other activity would have the Legislature speaking pointlessly, rendering the economic loss requirement superfluous and meaningless.

Director’s Delegate Blackman agreed with the Arbitrator that there may be specific occasions where a loss of opportunity might equate to an economic loss under the Schedule; however in this case, Mr. Simser did not satisfy the Arbitrator that his providers had sustained an economic loss relating to the housekeeping and attendant care benefits in question, as advanced in the form of loss of income, loss of schooling or out-of-pocket financial or monetary loss. Director’s Delegate Blackman concluded that:

As the Court of Appeal stated in Henry, where no economic loss is sustained, no attendant care benefits are payable in respect of care provided by a family member even if the family member provided care that would otherwise be provided by someone in the course of their employment, occupation or profession that would require the insurer to pay attendant care benefits.

Overall, the decision confirms that the onus of proof to demonstrate an expense was “incurred” rests on the Applicant. It is not sufficient that the expense has been paid. The provider must have provided goods or services in the course of the employment, occupation or profession in which they would ordinarily have been engaged or have sustained an economic loss in providing these services.  

This interpretation of the legislation is consistent with recent amendments to the Statutory Accident Benefits Schedule and clears up the ambiguity with respect to what constitutes an “economic loss”.  

Ontario Regulation 347/13, amending the Statutory Accident Benefits Schedule comes into force on February 1, 2014. The Regulation’s new subsection 19(3) clarifies that if an attendant care provider is not acting in the course of his or her ordinary employment, the attendant care benefit payable shall not exceed the amount of the economic loss sustained while, and as a direct result, of providing the attendant care.  Therefore the amendments restrict any entitlement to attendant benefits to the actual quantum of the economic loss.

Overall, the amendments and the interpretation of the legislation as demonstrated in Simser v. Aviva should significantly reduce the number of non-professional service providers who can recover compensation for their services, unless, a quantifiable economic loss can be demonstrated.