Kusnierz v. Economical Mutual Ins. Co.

Chris T.J. Blom, Toronto

In a stunning turn from the historical interpretation of the assessment of catastrophic impairment under the Statutory Accident Benefits Schedule (the “SABS”), Justice Peter Lauwers released the decision of Kusnierz v. Economical Mutual Insurance Co.¹ on October 18, 2010.

The case dealt with two primary issues:  the method by which catastrophic impairment may be assessed; and the specific assessment in the case of the plaintiff.

Background

Robert Kusnierz was a passenger in a vehicle involved in an accident on December 24, 2001.

As a result of the accident, Mr. Kusnierz suffered numerous injuries, the most serious of which led to an amputation of his left leg, below the knee.

Mr. Kusnierz claimed accident benefits from Economical Mutual.

Counsel for Mr. Kusnierz and the insurer agreed to submit certain questions to the court in the course of the trial before Justice Lauwers.

The first question was to determine if it was permissible to assign percentage ratings in respect of Mr. Kusnierz’s psychological impairments under clause 2(1.1)(g) of the SABS and combine them with percentage ratings in respect of Mr. Kusnierz’s physical impairments under clause 2(1)(f).

The second question called upon the court to assess Mr. Kusnierz’s impairments to determine if he was suffering from catastrophic impairment on the basis of clause 2(1.1)(f), alone.

Before considering the two issues, Justice Lauwers reviewed the guidance in the Ontario Court of Appeal decision of Bapoo v. Co-operators General Insurance Company² in which the court stated that one must interpret a legislative provision in its total context.  The interpretation of the SABS should comply with the legislative context, promote the legislative purpose and produce a just meaning.  This leads to a purposive analysis and interpretation of the legislation.

Many arbitrators and judges who have considered the issue of catastrophic impairment have received guidance from medical experts in the interpretation of the Guides to the Evaluation of Permanent Impairment (the “Guides”) and its application to the SABS.  Justice Lauwers raised a caution as follows:

It would be an error to defer to or to adopt expert opinion on the legal issue, and I do not do so.  I find, however, that the expert evidence is admissible to set the context for the Guides and the way in which they ordinarily operate.  It is also admissible to assist the court in navigating the Guides and in understanding the underlying medical judgments.

Issue I

Under clause 2(1.1) of the SABS, catastrophic impairment is defined in a number of different ways. For the purpose of the claim on behalf of Mr. Kusnierz, the court was required to address two of the sections, as follows:

f.  subject to subsections (2) and (3), an impairment or combination of impairments that, in accordance with the American Medical Association’s Guides to the Evaluation of Permanent Impairment, 4^th edition, 1993, results in 55 per cent or more impairment of the whole person; or
g.  subject to subsections (2) and (3), an impairment that, in accordance with the American Medical Association’s Guides to the Evaluation of Permanent Impairment, 4^th edition, 1993, results in a class 4 impairment (marked impairment) or class 5 impairment (extreme impairment) due to mental or behavioural disorder.

The Guides provide a method by which medical practitioners may assess impairment and assign a percent rating to the impairment.  In circumstances where a person is suffering from more than one impairment, the impairments are combined under a Combined Values Chart. If the impairment or impairments reaches a total of 55% or more of the whole person, the person is suffering from a catastrophic impairment under the SABS.

Chapters 3 to 13 of the Guides deal with physical impairment.  Chapter 14 of the Guides deals with mental or behavioural impairment.  Mental or behavioural impairment is not assessed on a percent scale. Rather, it is assessed on a scale which ranks impairment from class 1 to class 5.  It is only if the insured is suffering from a class 4 impairment or a class 5 impairment that the insured is suffering from a catastrophic impairment.

In the earlier decisions of Desbiens v. Mordini³ and Arts v. State Farm⁴, the court combined the physical impairments in clause (f) and the mental or behavioural impairments in clause (g). In order to do so, the court first had to ascribe a per cent level of impairment to the mental or behavioural disorder in order to use the combined values chart to achieve the ultimate whole person impairment (“WPI”).

The 4^th edition of the Guide does not include per cent measures of impairment for mental or behavioural impairment under chapter 14.  However, the chapter does reference per cent levels used in earlier editions.  The courts in Desbiens and Arts felt it appropriate to use the per cent measures in the earlier editions, to allow the combination of physical impairment with mental or behavioural impairment.  In doing so, the courts allowed experts to provide clinical judgment in the assessment of the level of mental or behavioural impairment in percentage terms.

Justice Lauwers was not prepared to follow the precedent established by these earlier decisions.  As he observed, the Guides explain in chapter 14 that mental or behavioural impairments are not expressed in percentages as there is no empiric evidence to support any method for assigning a percentage of psychiatric impairment of the whole person.  He rejected the submission of counsel for Mr. Kusnierz that the reference to percentages in previous editions gives tacit permission to use them in the assessment of catastrophic impairment.

The Guides are based on the assessment of objective and verifiable impairment.  This does not permit the introduction of clinical judgment in the assessment of a percentage level of impairment for a mental or behavioural disorder.  Justice Lauwers expressed his concerns as follows:

The problem with mental or behavioural impairments is that such standardized assessments are not permissible.  Dr. Ameis testified that impairment is to be based upon objective findings, not subjective non-verifiable complaints … combining the mental or behavioural impairments with the physical impairments would introduce the danger of creating an impairment rating system that is not based on consistent objectivity.

Justice Lauwers concluded that the combination of physical impairments with mental or behavioural impairments was not permitted under the SABS.  He gave detailed reasons, as follows:

1. The policy position in the 4^th edition of the Guides against combining physical and mental or behavioural impairment is clear and distinctive, that the legislature must have been familiar with this when this edition was selected as the standard for determining catastrophic impairment under the SABS;
2. Impairments due to mental or behavioural disorder are separately and specifically referred to in clause (g).  Under this provision, catastrophic impairment is only considered if one suffers from marked impairment or extreme impairment. By implication, this excludes the consideration of any other level of mental or behavioural impairment for the purpose of assessing catastrophic impairment;
3. There is no indication in clause 2(1.1) that impairments due to mental or behavioural disorder that are lesser than marked impairment or extreme impairment are to be included with the impairments assessed under clause (f);
4. The original definition in the 1996 edition of the SABS used the introductory phrase “catastrophic impairment means …”.  The legislative intent was therefore to narrow the scope of the word.  This conclusion is reinforced by considering the most recent version of the definition of catastrophic impairment in the SABS which reads “catastrophic impairment … is …”;
5. The category of “catastrophic impairment” is meant to be exceptional in the SABS.  Only those who suffer such an injury have the additional entitlement to benefits, which was one of the purposes of Bill 59 in restricting the right to accident benefits and the right to initiate lawsuits;
6. The things listed that qualify as catastrophic impairments under the definition are very serious and would, by their nature, be relatively rare. There is no indication of legislative intent that the list be expanded by the exercise of discretion;
7. The word which links clause (f) and clause (g) is “or”.  This is clearly a disjunctive use of the word;
8. If the legislature intended that physical impairments be combined with mental or behavioural impairments, it would have been easy to say so clearly. It did not.

One of the methods by which previous courts have concluded that mental or behavioural impairments must be considered with physical impairments is the use of the word “impairment” in the SABS.  A mental or behavioural impairment is an impairment.  If clause (f) considers all impairments, one must include mental or behavioural impairments.

Justice Lauwers disagreed with this approach for two reasons.

First, the word “impairment” is used more than 150 times in the SABS.  Each time it is used, it takes its character from the specific usage in context.  For example, a dentist considers a dental impairment whereas a psychologist considers a psychological impairment.  One cannot say that the use of the word impairment in relation to the treatment considered by either health practitioner is the same.

Second, a compendious definition of “impairment” would override the usage specific interpretation of the word, in the absence of a positive and clear direction from the legislature.

One of the methods by which earlier decisions have resolved to combine physical impairments with mental or behavioural impairments is to consider analogous impairments.  This is permitted under the provisions of clause 2(3) of the SABS, where an impairment that is sustained by a person but not listed in the Guides, shall be deemed to be the impairment that is listed in the Guides that is most analogous to the impairment sustained by the person.  On the basis of this provision, counsel for Mr. Kusnierz argued that one must assign a percentage rating for the mental or behavioural impairments experienced by the plaintiff.  Justice Lauwers disagreed.  This would undermine the objective approach to the assessment of impairments under the Guides. If Mr. Kusnierz was suffering from a mental or behavioural disorder, that must be considered under chapter 14.  If he does not suffer from a class 4 or class 5 impairment, the mental or behavioural impairment cannot be given any further consideration for the purpose of the assessment of catastrophic impairment.

Justice Lauwers recognized that an interpretation of the SABS which does not permit the combination of mental or behavioural disorders with other impairments creates a gap in eligibility for catastrophic impairment benefits. Counsel for Mr. Kusnierz argued that this would be unfair and unjust, such that the court should avoid an interpretation which would lead to such a result.  Dr. Michel Lacerte, who gave evidence on behalf of the insurer, noted that a similar gap existed in the area of worker’s compensation in Ontario.  The Workplace Safety and Insurance Board had implemented a policy in order to bridge the gap.  A similar policy has not been implemented in the use of the SABS.

Issue II

The second issue addressed by the court was the question of whether Mr. Kusnierz has sustained a catastrophic impairment under the provisions of clause (f) of the SABS, alone.

The primary source of impairment sustained by Mr. Kusnierz arose from the below-knee amputation.  The amputation left a stump longer than 3 inches in length.  Accordingly the WPI under the Guides was 28%.  This was the result achieved by Dr. Lacerte in his assessment.

Dr. Arthur Ameis gave evidence on behalf of Mr. Kusnierz.  He used a “results-oriented” approach to the assessment under the Guides, in order to achieve a determination of catastrophic impairment.  He was quite candid in this in the course of his evidence.  He argued that any person who has suffered an amputation above the ankle, so that he or she is unable to stand without a prosthesis, should be considered to be catastrophically impairment.  He therefore used his clinical judgment in order to rank Mr. Kusnierz’s impairment at 60%.

Justice Lauwers was critical of this approach.  He observed that Dr. Ameis lost a measure of his independence as an expert as a result of the nature of the retainer by counsel for the plaintiff. Justice Lauwers therefore observed that one must take his evidence “with the proverbial grain of salt that goes to its weight.”

On the question of clinical judgment, which so often persuaded the trier of fact in earlier cases, Justice Lauwers made the following observation:

While clinical judgment has some limited scope, as my review of the evidence will show, medical assessors are given no overriding discretion to substitute their views for the hard evidence required by the Guides.  If anything, the Guides aim at reducing the scope for subjectivity and discretion.  As I observed earlier in the context of the first issue, the exhaustive definition of “catastrophic impairment” in the SABS grants no overriding discretion to the court.

…

the SABS, through the use of the Guides, prescribe a high structure framework that is quite precise and mathematical.  The result of bright line threshold like 55% WPI is that some people will meet it handily, others will fall far short, and some will come close.  For those who come close, there is no discretion in the court, out of sympathy, to push the plaintiff over the line.  This is the scheme that the legislature has adopted and that binds me in determining the second issue.

One of the methods by which Dr. Ameis sought to argue for a higher WPI was to be equivocal about the length of the stump.  Under the Guides, a stump of 3 inches or more achieves a WPI of 28%.  Dr. Ameis offered the opinion that the stump is “about 3 inches”.  Dr. Lacerte criticized this assessment.  One should not reference an assessment as one that is “about” a certain measure, because that brings a certain degree of vagueness.  The Guides are not based on being vague.  Measurements must be precise in order to achieve a precise mathematical result.

While Justice Lauwers applied the 28% WPI for the amputation, he acknowledged that the approach taken by the plaintiff could lead to a WPI of 40% in relation to the amputation, not the 60% advocated by Dr. Ameis.

The court then had to consider other areas of impairment in order to combine them under the Combined Values Chart.

The first issue was to consider whether the plaintiff should receive a skin impairment rating, or whether the skin impairment formed part of the WPI assessment related to the amputation.  Dr. Lacerte observed that the Guides recognize that skin issues are related to the amputation and therefore fall within the WPI assessment for the amputation at 28%.  Dr. Ameis took the contrary position and argued that the skin impairment must be considered in addition to the impairment rating for the amputation. Dr. Lacerte conceded that a skin impairment would affect the ability to use the prosthesis. Justice Lauwers therefore found that Mr. Kusnierz had a class 2 skin impairment in the range of 10% to 24%, which he fixed at 15%.

Mr. Kusnierz sustained impairments in relation to the cervical, thoracic and lumbar spine. He experienced impairment as a result of numbness and tingling in the right 4^th and 5^th digits.  He also sustained impairment in relation to this reaction to medication. Modest WPI assessments were attributed to each of these sources of impairment.

Justice Lauwers then compared the plaintiff approach with the defence approach. The defence approach achieved a WPI of 50%.  The plaintiff approach, excluding an assessment for the skin, achieved a WPI of 51%.  Under the Guides, the result must be rounded up or down to the nearest value ending in 0 or 5.  The final result therefore was 50%, whether one used the plaintiff approach or the defence approach.

Concluding Comments

The decision in Kusnierz represents a significant change from the earlier law, which allowed the combination of impairments under clause (f) and clause (g). We anticipate that the decision will be appealed to the Ontario Court of Appeal, given the conflicting law and the potentially significant impact on the industry.

The reasoning of Justice Lauwers is sound. It follows a purposive analysis of the legislation, rather than one which seeks to achieve compensation at the expense of the language of the legislature. The primary rule of statutory interpretation requires the court to follow the plain language of the statute. This is the manner in which Justice Lauwers read and applied the provisions of the SABS.

We anticipate that the decision will be upheld by the Court of Appeal.

¹ [2010] O.J. No. 4462.

² (1997), 36 O.R. (3d) 616.

³ [2004] O.J. No. 4735.

⁴ [2008] O.J. No. 2096.

Back to top