Catastrophic Impairment; Discoverability in Fatal Accident Cases

This edition of Update includes:

  • a case that deals with the determination of “catastrophic impairment” in the context of automobile insurance; and
  • “discoverability” in a fatal accident claim.

Catastrophic Impairment

Section 267.5(3) of the Insurance Act protects defendants from liability for damages for “health care expenses” unless the person has sustained a catastrophic impairment as defined under Regulation 461/96. In Snushall v. Fulsang, an Ontario Superior Court decision released this week, Justice Lax has provided the first detailed commentary on the procedure by which “catastrophic impairment” is determined. Her comments were rather critical of the existing system.

Section 5 of Regulation 461/96 sets out the scheme by which the determination of “catastrophic impairment” is to be made. There are a number of criteria by which a claimant can be found to be catastrophically impaired. Some are rather straightforward (paraplegia, quadriplegia, loss of use of both arms, loss of vision in both eyes). These cases don’t present a problem. It is the injuries that are closer to the line that are problematical. In those cases, recourse is to be had to the American Medical Association’s Guides to the Evaluation of Permanent Impairment, 4th edition, 1993. If a person is found to have an impairment or combination of impairments that result in an “impairment of the whole person” of 55% or more, according to the AMA Guides, then catastrophic impairment will have been established.

To begin with, Justice Lax wondered why it is that in Ontario, we are using a book that was developed in the United States, for quite a different purpose:

In the United States, the Guides are primarily used to adjudicate claims of illness and impairment in workers’ compensation cases, but they are not uniformly or universally used there. Their use in regard to workers’ compensation claims is mandated in only nineteen American states and territories. They are not used frequently or at all in thirteen American states, including California, Michigan, New York, New Jersey and Pennsylvania. The Guides are designed to provide a standard framework for physicians to evaluate and communicate information about the impairments of any organ system. The impairment estimates are then available to assist others, presumably adjudicators of compensation and disability claims in the United States, to understand how the impairment affects a person’s employability and daily activities. Is it reasonable then to ask a judge to determine a plaintiff’s entitlement to damages for future medical treatment and rehabilitation in Ontario on the basis of standardized impairment ratings for the assessment of work-related disability claims in the United States? As one commentator has aptly noted:

Why are we in Ontario using Guides published by the American Medical Association in Chicago? Is it appropriate to use a document that derives from a country with different laws, regulations, statutes regarding disability determination…?

Next, Her Honour criticized the fact that the Regulation requires the use of an out-of-date edition of the Guides:

Moreover, why are we in Ontario using an edition of the Guides that is now ten years out-of-date? The authors “strongly discourage” the use of any but the most recent edition of the Guides as “the information would not be based on the most recent and up-to-date material.” The use of the 1993 edition presented a practical problem at the trial as neither counsel had a copy of this edition when the trial commenced. They informed me that the 1993 edition of the Guides was no longer in print and was difficult, if not impossible, to obtain.

Her Honour went on to observe that the Guides themselves state that they are not to be used for the purpose of making financial awards or making direct estimates of disabilities:

The Guides state:

Each administrative or legal system that uses permanent impairment as a basis for disability ratings should define its own means for translating knowledge about an impairment into an estimate about the degree to which the impairment limits the individual’s capacity to meet personal, social, occupational, and other demands or to meet statutory requirements.

strong>It must be emphasized and clearly understood that impairment percentages derived according to Guides criteria should not be used to make direct financial awards or direct estimates of disabilities. [Emphasis in original]

Despite her unhappiness with the statutory framework within which she had to make her decision, Justice Lax analyzed the plaintiff’s injuries, to see whether they were catastropic. The main injuries that had been suffered by the plaintiff Snushall were a lumbar fracture and a head injury. The court heard evidence from Dr. Arthur Ameis on behalf of the defendant and Dr. Becker on behalf of the plaintiff. Dr. Becker was the plaintiff’s family physician.

Ultimately, Justice Lax did not accept either expert’s view of how the Guides should be applied, but nevertheless found that the plaintiff had fallen short of proving a 55% whole body impairment. The case is instructive in its illustration of how a court will work with the expert evidence and the somewhat artificial categorizations of the AMA Guides in order to rule on the issue of catastrophic impairment.

In our experience, the selection of an expert for the purpose of determining catastrophic impairment involves rather different considerations than choosing a medical expert in other contexts. As you will see from Justice Lax’s analysis, it is of paramount importance to have an expert who is conversant with the scheme of the AMA Guides. Being able to diagnose the claimant’s condition accurately is only part of this process; the diagnosis must then be fitted into the framework of the Guides and we have found that those who do not perform this task regularly have a great deal of difficulty with it.

Discoverability in a Fatal Claim

In our second case today, Madam Justice Greer of the Ontario Superior Court has applied the “discoverability” principle in a fatal accident claim under the FLA. The case is Coutanche v. Napoleon Delicatessen. The plaintiffs were FLA claimants who were the parents and sibling of Ronald Coutanche Jr., who was killed in a 1998 motor vehicle accident.

The plaintiffs consulted a lawyer within a couple of weeks of the accident, but no action was started within the two year limitation period. (Section 206(2) of the Highway Traffic Act provides that a proceeding against a person for the recovery of damages occasioned by a motor vehicle may be brought within the time limited by the Family Law Act. Section 61(4) of the latter stipulates a limitation of “two years from the time the cause of action arose”.)

The plaintiffs’ first lawyer did not sue within the limitation period and they consulted another lawyer, who did sue on their behalf.

Unlike most limitation periods, the FLA has a built-in power to extend where

(a) there are apparent grounds for relief;

(b) relief is unavailable because of delay that has been incurred in good faith; and

(c) no person will suffer substantial prejudice by reason of the delay.

Justice Greer applied the discoverability principles in order to conclude that the limitation period should be extended under s. 61(4).

What is novel about the application of discoverability in fatal cases is, of course, that the fact of the deceased’s death is normally known immediately afterwards. It might be thought that there was nothing that remained to be “discovered”.

But the Court of Appeal, in the Aguonie case, has made it clear that there is no “principled reason” why discoverability cannot apply to actions arising under s. 61 of the FLA. In that case, which also involved a fatal claim, the Court ruled that the limitation period would have started to run sometime between the date of the death and the date on which the plaintiffs received an expert’s report that suggested that they had a right to sue someone as a result of the death.

It is noted in the decision of Justice Greer, that the lawyer whom the plaintiffs originally consulted practised primarily in the field of criminal law. He apparently never mentioned to the plaintiffs that there was a limitation period that would affect their claim.

The fact that Justice Greer seems to have taken these facts into account in her discoverability analysis suggests that the level of skill or knowledge possessed by the claimant’s lawyer can be relevant in such cases.

But Justice Greer’s approach must be viewed in the context of the particular limitation period with which she was dealing. Because the FLA limitation period, unlike most others, can be extended in certain circumstances, Justice Greer’s analysis can be said to have been directed at the three factors relevant to the power to extend and that are set out in s. 61(4) of the FLA. Where the limitation period in question contains no such power to extend, the result might be different.

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