The March 24, 2010 decision of Justice Grace in Wadhwani v. State Farm, 2010 ONSC 2479 allows accident victims that return to work shortly after an accident, but become disabled over time, to recover Income Replacement Benefits (IRBs). Carmen Wadhwani was injured in a motor vehicle accident on September 26, 1997. State Farm was her automobile insurer for the purposes of Statutory Accident Benefits. Ms. Wadhwani was 33 years old at the time of the accident. She had recently started her own business as an aesthetician.
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It was undisputed that Ms. Wadhwani sustained injuries as a result of the accident. She saw her family doctor and various specialists on a regular basis following the accident. She also consistently complained of various pains, headaches and nausea. She was able to continue working as an aesthetician for several years. In August of 2005, Ms. Wadhwani’s condition deteriorated, preventing her from working. A claim was commenced against State Farm for various benefits, including IRBs. In turn, State Farm brought a motion for summary judgment pursuant to Rule 20.01(3).
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Section 4(1) of the SABS requires an insurer to pay an IRB to an injured claimant who “…was employed at the time of the accident and, as a result of and within 104 weeks after the accident, suffers a substantial inability to perform the essential tasks of that employment.” An insurer can have recourse to section 5(2) to deny IRBs “for any period longer than 104 weeks of disability, unless, as a result of the accident, the insured person is suffering a complete inability to engage in any employment for which he or she is reasonably suited by education, training or experience.” The language in section 4(1) is commonly referred to as the “own occupation” test. Conversely, section 5(2) is the “any occupation” test.
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Justice Grace, in finding for the Plaintiff, refers to conflicting evidence as to precisely when Ms. Wadhwani returned to work, and with respect to her functionality. Justice Grace was not satisfied that the Plaintiff’s return to work continued without further interruption. In a supporting Affidavit, Ms. Wadhwani deposed that she returned to work as quickly as possible for fear of losing her customers, notwithstanding her continued pain problems, which eventually became chronic in nature. She was reportedly not performing all of her work duties or responsibilities. She considered herself to be disabled.
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State Farm argued that Ms. Wadhwani did not produce a single report of a health professional in support of her inability to perform her job during the first 104 weeks after the accident.
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Justice Grace found that the fact that Ms. Wadhwani continued to work, with difficulty, until August, 2005 does not prevent her from establishing that she suffered “a substantial inability to perform the essential tasks” of her employment within 104 weeks of the accident. Justice Grace found that a more detailed analysis of her work history during that time period is required.
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Justice Grace found some support for State Farm’s argument that section 4 is a pre-condition to the operation of section 5, particularly with reference to Burtch v Aviva [2009] ONCA 479 (CanLII). That is, an insurer must pay IRBs beyond the 104 week mark only if one of the qualifications in section 4 is met. In Burtch, however, the parties agreed that the insured had satisfied section 4. Ultimately, Justice Grace found that the inter-relationship between sections 4 and 5(2)(b) of the SABS involve significant issues of fact and law regarding entitlement and quantification of IRBs, which ought to be resolved at trial.
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Tags: disability, IRB, SABS
