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Kusnierz v. Economical: What does it Mean for CAT Cases?

Since FSCO released the “Recommendations for Changes to the Definition of Catastrophic Impairment”, plaintiffs’ lawyers across Ontario have been very concerned about what the proposed recommendations means for catastrophically impaired accident victims. For an overview of the proposed recommendations, please visit our blog entry, “Catastrophic Injuries: what you need to know about the proposed changes“.

Something else that has been pressing on the minds of the plaintiffs’ lawyers is the case of Kusnierz v. Economical. This case is currently under appeal to the Ontario Court of Appeal, to be heard on November 16, 2011.

Robert Kusnierz was a passenger in a motor vehicle rollover accident that occurred on December 24, 2001 and suffered serious injuries. His most serious injury was an amputation to his left leg, below the knee. He went on to develop problems with finding a prosthetic leg and developed cysts on his stump.

His trial proceeded in Newmarket before the Honourable Mr. Justice Lauwers in November 2009 and January 2010. It was argued that Justice Lauwers ought to follow the 2004 decision of Desbiens v. Mordini in deciding the case. Mr. Kusnierz was seeking a declaration that he had sustained a catastrophic impairment and was therefore entitled to a high level of benefits under that category, under the Statutory Accident Benefits Schedule (SABS).

Mr. Kusnierz had exhausted his $100,000 medical and rehabilitation limits by November 11, 2005. If he is to be declared catastrophically impaired, the Economical Mutual Insurance Company must pay $1,000,000 in medical and rehabilitation benefits.

In Desbiens, the Honourable Mr. Justice H. Spiegel determined that the plaintiff was catastrophically impaired as a result of his 1999 motor vehicle accident pursuant to the American Medical Association’s (AMA) Guidelines (4th Edition) for whole body impairment. The AMA Guidelines are incorporated into the Insurance Act in Section 267.5(4). Justice Spiegel concluded that the proper interpretation of the AMA Guidelines with respect to whole body impairment is to assign a percentage rating to the plaintiff’s psychological impairments and these are to be combined with the physical impairments for the purposes of determining whether impairments meet the definition of catastrophic.

Desbiens set the standard for FSCO and Superior Court decisions with respect to determining what was the correct way to decide on the issue of catastrophic determination.

In Kusnierz, Justice Lauwers concluded that the AMA Guidelines 4th edition does not allow for the combining of mental and behavioural impairments with physical impairments. Justice Lauwers held that there is a distinction to be had between mental and behavioural disorders in Chapter 14 of the Guide and physical impairments which are referred to in other chapters of the Guide.

Justice Lauwers went on to assign a rating for Mr Kusnierz’ physical impairments (amputation, skin issues, medication needs, cervical spine, lumbar spine, ulnar nerve), being 50% and not catastrophically impaired. A whole person impairment rating of 55% or more is needed to be catastrophically impaired.

The Court of Appeal’s decision will answer whether or not a percentage rating can be applied to psychological impairments for the purposes of a whole person impairment rating.

If Justice Lauwers’ ruling is upheld, and impairment ratings can no longer be combined, car accident victims who have suffered serious physical injuries and psychological injuries that do not meet the whole person impairment 55% threshold for catastrophic in either category, but would meet the catastrophic threshold if ratings were combined, are going to lose out on SABS benefits.

This will be incredibly challenging for plaintiff’s lawyers and accident victims, especially for those who have not chosen to purchase optional benefits to increase their medical and rehabilitation coverages from $50,000 to $100,000.

Optional benefits are available through insurance companies for added protection. It is better to have $100,000 coverage for non-catastrophic claims than $50,000 as people underestimate how fast $50,000 can be used up.

It can take 2 years or more until an accident victim is declared catastrophic.

For now, plaintiff lawyers are anxiously awaiting the results of the November court appearance in Kusnierz, and waiting to hear what recommendations FSCO is going to consider from the expert panel with respect to changes to the definition of catastrophic. Bear in mind the recommendations included reviewing the very issue being considered in Kusnierz, and the panel stated that further study is needed with respect to combining psychological and physical ratings and in the interim, this combination should not be allowed.