Catastrophic Impairment: Aviva v. Pastore

The Court of Appeal has released an important decision relating to catastrophic impairment:

Aviva Canada Inc. v. Pastore, 2012 ONCA 642 (C.A.)

The insured was injured in a 2002 motor vehicle accident as a pedestrian and sustained an ankle injury. She alleged her gait had been altered and was diagnosed with a pain disorder.  A DAC found her to be catastrophically impaired in 2005 due to a marked mental or behavioural impairment under s. 2(1.1)(g) of the SABS.  An assessment under s. 2(1.1)(g) is carried out with reference to the AMA Guides, which provide for an assessment of function in four categories:

(1)              Activities of daily living (ADL);

(2)              Social functioning;

(3)              Concentration, persistence and pace; and

(4)              Deterioration or decompensation in work or work-like settings.

Pastore was diagnosed with a number of psychological disorders and the DAC concluded that she had a class 4 marked impairment in activities of daily living.  The DAC concluded she was catastrophically impaired on the basis of the one class 4 impairment.  The insurer did not agree with the assessment and the matter proceeded to mediation then arbitration.

At arbitration, the arbitrator agreed with the DAC assessors and held that one marked impairment was enough to comply with the Guides approach to impairment.  In addition, it was appropriate to consider physical pain in assessing mental disorder, as it was not possible to factor out all physically based pain since it was intertwined with mentally based pain. The Director's Delegate upheld the decision, but the Divisional Court overturned the arbitrator.

The Court of Appeal allowed the appeal and reinstated the arbitrator`s decision.  The conclusion that only one marked impairment is sufficient to meet the definition of catastrophic impairment was a reasonable one. In addition, it was not an error for the DAC assessors to consider both physical and mental pain.

Pastore appears to have lowered the bar for catastrophic impairment based on a mental disorder and more claimants may be able to fit themselves into a catastrophic designation than prior to this decision.

Kusnierz - Combining Impairments in Determining Catastrophic Impairment

Kusnierz v. The Economical Insurance Company (2012) 108 O.R. (3d) 272 (C.A.)

Kusnierz is an important Court of Appeal decision regarding catastrophic impairment under the SABS.

Mr. Kusnierz suffered a below the knee amputation and clinical depression in a 2001 accident. The parties disagreed as to whether he met the criteria to be declared catastrophically impaired, and the trial judge held that he did not. The key issue was whether physical and psychological impairments can be combined in evaluating whether a person is catastrophically impaired under the SABS.

The Court of Appeal held that it is permissible to combine physical and psychological impairments for the following reasons:

1. The legislator did not expressly forbid the combination;
2. The AMA Guides aim to assess the total effects of a person’s impairments on daily activities;
3. The Guides describe a number of situations where physical impairments should take into account mental and behavioural impairments;
4. The combination of impairments is consistent with the purpose of the SABS. The Court noted that the respondent conceded that there are few cases where physical and psychological impairments are catastrophic when combined but not when assessed separately. The class of persons who are CAT will therefore remain small; and
5. Combination promotes fairness and the objectives of the statutory scheme.

Although Kusnierz has the potential to open up the floodgates for catastrophic claims, it may be that the class of cases that fit into this situation remains small, as predicted by the Court of Appeal. It may take time before the full effects of Kusnierz are truly known.

- Tara Pollitt

GCS that Fluctuates Above 9 May Still be Considered Catastrophic

Liu v. 1226071 Ontario Inc. (Canadian Zhorong Trading Limited)(2009), 97 O.R. (3d) 95 (C.A.).

The Court of Appeal has released a decision that may make it more difficult to resist a declaration that a claimant is catastrophically impaired.

In Liu, the plaintiff was injured in a motor vehicle accident on April 9, 1999. His initial Glasgow Coma Score (“GCS”) was 3/15. His GCS steadily increased and by the time he arrived at hospital 26 minutes later, his GCS was 14. The definition of “catastrophic impairment” is brain impairment that results in a score of 9 or less on the GCS according to a test administered “within a reasonable period of time after the incident by a person trained for that purpose”. The trial judge concluded that the appellant did not suffer a catastrophic impairment, and as a result, he was not entitled to receive a damage award for future medical, rehabilitation or attendant care expenses, which the jury assessed at $858,000.00. The issue of catastrophic impairment was therefore very important to both sides.

The Court of Appeal held that as long as there is one GCS score of 9 or less within a reasonable time following the accident, the plaintiff’s impairment falls within the definition of catastrophic impairment. The fact that there may have been other, higher scores also within a reasonable time after the accident is irrelevant.

This decision has implications in both the accident benefits sphere and on tort damages. Although it simplifies the definition of catastrophic impairment to a certain extent, it permits claimants who have met the definition for a limited period of time to access increased damages. It remains to be seen whether this decision will be appealed to the Supreme Court of Canada.