On March 26, an arbitration decision dealt a potentially serious blow to the minor injury guideline.
The case represented the first arbitral or judicial decision considering the definition and applicability of the minor injury guideline. It came more than two years after the introduction of the minor injury guideline along with sweeping changes to the statutory accident benefits schedule. The changes have dramatically reduced the accident benefits available to motor vehicle accident victims and have correspondingly resulted in dramatic increases to insurance company profits.
The decision at issue involved Lenworth Scarlett and Belair Insurance Company Inc. In it, arbitrator John Wilson forcefully sided with Scarlett, the applicant, in finding his injuries did not fall within the minor injury guideline and thus allowed him to claim up to $50,000 in medical and rehabilitation benefits rather than the paltry $3,500 limit that would otherwise apply. As Scarlett’s matter did not fall under the minor injury guideline, he could also claim attendant-care benefits.
In the ruling, Wilson determined a number of important matters:
• The minor injury guideline, as guidance issued by the superintendent of insurance, was a non-binding interpretive tool despite its incorporation directly into the statutory accident benefits schedule. Wilson reasoned that as the Insurance Act was supreme and it clearly states that guidelines are simply to be “considered,” incorporation of the minor injury guideline into the benefits schedule could not take precedence over the legislation itself. In other words, the Insurance Act dog always wags the regulatory benefits schedule tail.
Should this ruling survive on an expected appeal, it will have a profound muting effect on the impact of the minor injury guideline and free arbitrators and judges to more liberally determine how to consider its impact on and applicability to the statutory accident benefits schedule.
• The minor injury guideline, with its $3,500 limit for medical and rehabilitation benefits and its prohibition on claiming attendant-care benefits, is an exception to or limitation on coverage. As a result, it is the insurer’s burden to prove the claimant falls under it.
In other words, the default is that claimants injured in motor vehicle accidents are not subject to the minor injury guideline unless the insurer proves otherwise. That finding, if sustained on an expected appeal, would also be a significant weakening of the perceived applicability of the minor injury guideline.
The finding is even more significant when considering the fact that Wilson decried a “cookie-cutter” application of the minor injury guideline to every soft-tissue injury. In his view, it makes no sense to allow insurers to veto access to benefits.
• The requirement for “compelling evidence” to establish that a pre-existing medical condition was a bar to recovery if treatment was subject to a cap of $3,500 did not change the evidentiary burden of a balance of probabilities. Personally, I have never considered evidence based on a balance of probabilities not to be compelling.
• Temporamandibular joint pain, chronic pain syndrome, and post-traumatic stress disorder were separate and distinct injuries rather than a secondary consequence or result of Scarlett’s soft-tissue injuries.
The significance is that secondary consequences of an injury coming within the minor injury guideline do not take claimants out of that category. Unfortunately, Wilson did not give any reasons for this finding nor did he explain whether or why temporamandibular joint pain, chronic pain syndrome, and post-traumatic stress disorder were Scarlett’s predominant injuries. For an injury that does not come within the minor injury guideline to take someone out of that category, it must be the claimant’s predominant injury.
Other significant findings included the fact that the original disability certificate submitted by Scarlett arguably supported Belair’s belief that the minor injury guideline applied to him and that actual evidence by way of expert reports that stated the opposite came a year later.
Finally, in somewhat of a contradiction, Wilson ruled that any determination related to the minor injury guideline by an insurer could only be an interim one subject to a full arbitration hearing. He then went on to find that Scarlett did not come within the minor injury guideline based on a hearing of a preliminary issue.
At its simplest, the Scarlett decision is not particularly revolutionary in that it found Scarlett suffered from injuries that kept him out of the minor injury guideline. At its highest, the case dramatically limits the applicability and impact of the minor injury guideline. As an appeal is likely, together with the fact that many issues related to the minor injury guideline did not arise in the decision, the jury is still out on the final significance of the Scarlett case despite the potentially serious blow to the minor injury guideline.
Alexander Voudouris is senior litigation counsel at the Pace Law Firm in Toronto.
