How Your SABS File Works Your Tort Claim and Builds Your Special Damages

Introduction

Statutory accident benefits (“accident benefits”) are a type of no-fault insurance coverage attached to every automobile insurance policy in Ontario. The law which governs accident benefits is a regulation made under the Insurance Act.[1] The law governing accident benefits was amended for motor vehicle accidents occurring on or after September 1, 2010. These amendments resulted in a dramatic reduction in available accident benefits in cases that do not involve a catastrophic impairment. All references in this paper are to the current legislation. All accident benefits described assume that the insured person has not purchased any optional coverage.[2]

Do the recent amendments to the accident benefits system mean that lawyers and law clerks should put less effort into building an accident benefits file? No they do not. In cases where the injured client also has a tort claim the accident benefits file can be very useful in increasing the size of the tort claim thus increasing your client’s total recovery.

This paper will briefly summarize how a person qualifies for accident benefits and what benefits are available. The paper will then summarize the tort system and review different methods by which a law firm can use the accident benefits file to increase the recovery for a client in tort.

How does a person qualify for accident benefits?

If a person in Ontario suffers an impairment[3] that is directly caused by the use or operation of an automobile[4] then that person will be entitled to apply for accident benefits. This is true regardless of whether or not the injured party was an insured person or the spouse or dependent of an insured person under a policy of auto insurance.[5] This is also true even if the motor vehicles involved in the accident were uninsured or fled the scene of the accident.[6]

What benefits are available?

There are three categories of injuries under the current SABS. These are the minor injury guideline (“MIG”), catastrophic impairment claims (“CAT”) and all other claims.

For accidents occurring on or after September 1, 2010, the following benefits are available to an injured party who meets the applicable tests but are not CAT or MIG:

• A maximum of $50,000 in medical and rehabilitation benefits payable over 10 years following the accident[7];
• Attendant care benefits to a maximum of $3,000 per month (up to a maximum of $36,000).  This benefit is only payable for the first 104 weeks following the accident or until $36,000 is exhausted, whichever is earlier;
• An income replacement benefit of a maximum of $400 per week or 70% of weekly pre-accident gross income, whichever amount is lower. These benefits are payable up to age 65 with a reduced benefit thereafter but the test to qualify for the benefit becomes stricter after 104 weeks[8];
• Lost educational expenses of up to $15,000;
• Visitor expenses for 104 weeks following the accident[9];
• A non-earner benefit of $185 per week[10] if the injured party was not working at the time of the collision and now suffers a complete inability to carry on a normal life. There is a six month waiting period before you can qualify for this benefit. This benefit is payable up to age 65 with a reduced benefit thereafter; and,
• Reimbursement for damaged clothing, glasses, hearing aid, etc.

In the event of a death – the following benefits are available:

• a death benefit of $25,000 to a spouse, $10,000 to each dependent and one benefit of $10,000 to be split amongst the persons in respect of whom the deceased was a dependant at the time of the accident[11];
• a funeral benefit of $6,000.

MIG claims

Section 40 and Section 18 of the SABS sets out that if a person sustains an injury that is “predominately” a minor injury[12] that person is limited to a maximum of $3,500 in medical and rehabilitation benefits and is not eligible for any attendant care benefits. Injured people who fall under this guideline are still eligible for income replacement benefits if they meet the applicable test in the SABS.

 CAT claims

If the insured person suffers an impairment which rises to the level of catastrophic impairment[13] then the available medical and rehabilitation benefits increase to $1,000,000 payable over the insured person’s lifetime and the available attendant care benefits increase to a maximum of $6,000 per month payable over the person’s lifetime or until $1,000,000 has been exhausted.

In addition, insured people with catastrophic impairments are eligible for a housekeeping and home maintenance benefit of $100 per week for life and are eligible for a caregiver benefit of $250 per week for the first person in need of care and $50 per week for each additional person in need of care.  The caregiver  benefit is payable for the first 104 weeks of disability unless as a result of the accident the insured person is suffering a complete inability to carry on a normal life in which case it is payable for life.[14] Case management services are also available to people who have suffered a catastrophic impairment. The cost of case management is payable out of the medical and rehabilitation limits described above.

In addition, the following benefits apply:

•  An income replacement benefit of a maximum of $400 per week or 70% of weekly pre-accident gross income, whichever amount is lower. These benefits are payable up to age 65 but the test to qualify becomes more strict after 104 weeks[15];
• Lost educational expenses of up to $15,000;
• Visitor expenses for life[16];
• A non-earner benefit of $185 per week[17] if the injured party was not working at the time of the collision and now suffers a complete inability to carry on a normal life. There is a six month waiting period before you can qualify for this benefit. This benefit is payable up to age 65 with a reduced benefit thereafter; and,
• Reimbursement for damaged clothing, glasses, hearing aid, etc.

It is important to note that even though an insured person may qualify for more than one weekly benefit (i.e. income replacement benefit, caregiver benefit or non-earner benefit) the insured person must elect to receive only one of these weekly benefits and in most circumstances cannot re-elect.

The interplay between tort and accident benefits

The tort system is designed to put the not at-fault client in the financial position that he or she would have been if the injury had not occurred. In addition to damages for pain, suffering and loss of enjoyment of life[18] the not at-fault
client is entitled to compensation for virtually all of his or her economic losses arising from the injury. This includes past and future loss of income[19], past and future health care expenses[20], past and future housekeeping and home maintenance expenses and any other out of pocket expenses.

In a motor vehicle accident case the tort defendant is entitled to a credit for money received before trial from other sources including accident benefits, Canada Pension Plan Disability Benefits and/or Long-Term Disability Benefits.[21] For future losses the tort defendant must pay the entire award at the time of Judgment. The tort defendant then gets a trust or assignment of the collateral benefits going forward until the amount paid under the various heads of damages is repaid or until the collateral benefits are exhausted.[22]

How to build up your tort claim using the accident benefits file

One of the most important elements of the accident benefits claim is that it allows you funding to put a treatment team in place. The treatment team usually consists of an occupational therapist (“OT”) and a physiotherapist. Depending on your client’s injuries the team may also include a social worker, chiropractor, speech language pathologist, massage therapist, psychologist, rehabilitation support worker and/or a personal support worker. In CAT cases a case manager is also involved as the leader or quarterback of the team.

On non-catastrophic cases the OT usually acts as the quarterback of the treatment team. The OT will go in and assess the client and determine what type of care the client needs and whether they need any assistive devices.  The occupational therapist will usually fill out the Form 1 – Assessment of Attendant Care Needs Form.  It is important to get this form done early so that the monthly attendant care benefit can be assessed as high as possible. If this form is not submitted on a timely basis the accident benefits insurer may send in its own OT to complete the form. The amounts on insurer funded Form 1’s are invariably lower than those done by independent OTs.

By involving the right professionals at an early stage you will document the client’s impairments and their need for various treatment and services. For example, if your client needs attendant care at the rate of $6,000 per month but is only receiving $3,000 per month from the accident benefits insurer you can claim that shortfall as part of the tort claim. If your client exhausts his or her attendant care money in one year but the need continues all of those future attendant care costs will fall on the tort defendant’s shoulders. If the need for attendant care from the date of loss is not documented it is very difficult to get the tort defendant to pay for attendant care in the future.

The same concept applies to medical and rehabilitation needs. For example, assume your client receives treatment and services and exhausts the available $50,000 in medical accident benefits in eighteen months, this is a negative in terms of an accident benefits cash-out but it is a positive for your tort claim. It is a positive because you have strongly documented that the need for this treatment exists and you will have a much stronger case against the tort defendant than you would if those services had never been provided.

Even though your non-CAT clients are now unable to claim for housekeeping and home maintenance expenses as part of the accident benefits file they can still claim one hundred percent of these losses as part of the tort claim. In addition a housekeeping and home maintenance tort claim is not subject to a threshold or a deductible. In our office, we use the treatment team to document the client’s need for housekeeping and home maintenance services. For an additional fee, funded by the law firm, the treating OT will assess the client’s need for housekeeping and home maintenance expenses at the same time as he or she assesses the client’s other needs. This housekeeping and home maintenance report should be updated periodically until the tort file settles. By having a first-hand assessment done by a treating professional regarding the difficulties that your client faces in doing their pre-accident housekeeping and home maintenance tasks you will create a very solid case against the tort defendant under that head of damages.

It is also very important to have the clerk on the file ensure that the law firm is collecting receipts for all out of pocket expenses and keeping a schedule of all of those costs. In some cases these expenses can be submitted to the accident benefits insurer. However if the out of pocket expenses are not payable by the accident benefits insurer or if the applicable category of benefits has been exhausted these losses are payable by the tort defendant as long as they were caused or contributed to by the defendant’s negligence.

Conclusion

The accident benefits file can be a valuable tool in building up your tort claim. If the clerk who is working on the accident benefits file is aware of the many ways in which he or she can assist the lawyer in building a tort claim the result will be a larger recovery for the client, a happy law clerk and a happy lawyer.

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Oatley Vigmond

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