“It pays to know your rights now, because if you don’t, then you’ll pay to learn them later”

In this case study I will be discussing the deep-dive, strategic approach I used in one of my unreported catastrophic impairment (CAT) cases involving a child, who sustained a severe traumatic brain injury, in accordance with section 3.1(1)5i of the Ontario Regulation 34/10: Statutory Accident Benefits Schedule (Schedule). 

The most recent and profoundly significant reform to Ontario’s no-fault insurance took effect on June 1, 2016. These 2016 amendments to the Schedule introduced a stricter definition of “catastrophic impairment”, where section 3.1 was added, which provides a tightening of the criteria for the determination of CAT.

The crux of the disputes in all of the post-June-1-2016 reported CAT cases revolve around figuring out the following:

1. The intention of the legislature in using specific words or language in the CAT section of the Schedule; and
2. The meaning of those specific words or language within the broader context of the legislative purpose and scheme of the Insurance Act, R.S.O. 1990, c. I.8 (Insurance Act).

For example, in the recent case entitled Z.R. & A.R. v. Certas Direct Insurance Company, 2020 ONLAT 18-001468/AABS, which was argued before the Licence Appeal Tribunal (LAT), the dispute was whether or not it was the intention of the legislature to use the word “with” to denote a temporal association or connection between a child’s admission to a hospital on an in-patient basis and a positive finding of intracranial pathology. Likewise, the recent case entitled Patchett v. Optimum Insurance Company, 2020 ONLAT 19-008902/AABS, which was also argued before the LAT, the dispute was whether or not it was the intention of the legislature that subsection 3.1(1) paragraph 2(iii) requires a spinal cord independence measure (SCIM) score of five or less on a temporary basis or at any point post-accident, or a permanent basis, in order to receive a CAT designation.   

Therefore, I’ve found that the crux of the vast majority of the disputes in the reported decisions revolve around the following:

• Figuring out the intention of the Ontario legislature to use specific words or language in the CAT sections of the Schedule, within the broader context of the legislative purpose and scheme of the Insurance Act.

So, I thought you’d get more value from this case study if I discussed my strategic approach to obtaining a CAT designation, when the primary point of contention is an interpretation issue.

In this case study, I’ll discuss my unreported CAT case, involving the new automatic CAT definition for children who sustained severe traumatic brain injuries (TBIs) in accordance with section 3.1(1)5i of the Schedule, which requires an understanding of the intent of the Ontario legislature’s use of the June 2016, Catastrophic Impairment – Public Hospitals Guideline, Superintendent of Financial Services’ Guideline No. 01/16 (Superintendent’s Guideline 01/16). In this CAT case, the crux of the dispute was figuring out the intent of the Ontario legislature’s use of a Superintendent’s Guideline. So, I’ll discuss the deep-dive, strategic modern approach to statutory interpretation that I used to successfully:

• Overturn an insurer’s CAT denial of my client’s automatic CAT designation to increase her policy limits from $65,000.00 to $1 million; and
• Persuade the Financial Services Regulatory Authority of Ontario to amend the now old Superintendent’s Guideline 01/16 that interpreted section 3.1(1)5i, and replace it with the new “Guideline on Public Hospitals and Determination of Catastrophic Impairment”.

However, I’ll first briefly discuss the significant amendments concerning TBIs.

One of the big June-1-2016 amendments was the removal of the Glasgow Coma Scale (GCS) test as a means to obtain an automatic CAT designation with a GCS score of nine or less. In Dr. Bryan Jennett and Dr. Graham Teasdale’s book entitled Management of Head Injuries: Contemporary Neurological Series, volume 20, they noted that the GCS assesses your level of consciousness as an indicator of the severity of your brain damage from a trauma, and independently measures the state of three features or parameters of your responsiveness, namely eye opening, motor response, and verbal response. Following the June-1-2016 amendments, the GCS test was replaced with the Extended Glasgow Outcome Scale (GOSE) test. The GCS correlates levels of consciousness with ultimate patient outcomes within close time proximity of the accident, but doesn’t measure the overall social outcome of an ongoing traumatic brain injury, such as the more exhaustive GOSE scale.

So, in addition to the GOSE test, more objective scientific and evidence based criteria were added following the June-1-2016 amendments, such as, but not limited to, the King’s Outcome Scale for Childhood Head Injury (KOSCHI), which is one of the ways to determine if a child qualifies for a CAT brain injury. Lastly, there was a significant shift in how brain injured children are treated under the Schedule, as both children and adults are no longer assessed under the same section for the purposes of the CAT analysis. Post-June-1-2016, separate provisions in the Schedule were created specifically for children with brain injuries, granting them CAT status automatically if the required criteria are met.  

If you want to learn more about catastrophic impairment law, then please click the “link” to read my blog entitled “What is a Catastrophic Impairment?”.

New CAT Provision in SABS 34/10 Created Specifically for Children with TBIs

So, those separate provisions in the Schedule, which were created specifically for children with brain injuries, granting them CAT status automatically if the required criteria are met, are set out in section 3.1(1)5 of the Schedule, as follows:

5. If the insured person was under 18 years of age at the time of the accident, a traumatic brain injury that meets one of the following criteria:

i. The insured person is accepted for admission, on an in-patient basis, to a public hospital named in a Guideline with positive findings on a computerized axial tomography scan, a magnetic resonance imaging or any other medically recognized brain diagnostic technology indicating intracranial pathology that is a result of the accident, including, but not limited to, intracranial contusions or haemorrhages, diffuse axonal injury, cerebral edema, midline shift or pneumocephaly.

ii. The insured person is accepted for admission, on an in-patient basis, to a program of neurological rehabilitation in a paediatric rehabilitation facility that is a member of the Ontario Association of Children’s Rehabilitation Services.

iii.  One month or more after the accident, the insured person’s level of neurological function does not exceed category 2 (Vegetative) on the King’s Outcome Scale for Childhood Head Injury as published in Crouchman, M. et al, A practical outcome scale for paediatric head injury, Archives of Disease in Childhood, 2001: 84: 120-124.

iv. Six months or more after the accident, the insured person’s level of neurological function does not exceed category 3 (Severe disability) on the King’s Outcome Scale for Childhood Head Injury as published in Crouchman, M. et al, A practical outcome scale for paediatric head injury, Archives of Disease in Childhood, 2001: 84: 120-124.

v. Nine months or more after the accident, the insured person’s level of function remains seriously impaired such that the insured person is not age-appropriately independent and requires in-person supervision or assistance for physical, cognitive or behavioural impairments for the majority of the insured person’s waking day.

So, as you can see, section 3.1(1)5 of the Schedule contains five disjunctive parts or subparagraphs, which are applicable at different times. For example, the first and second subparagraphs are applicable at “hospitalization” when the child is admitted as an in-patient.  

If you want to learn more about catastrophic impairment law as it relates to children who sustained traumatic brain injuries as a direct result of an accident, then please click the “link” to read my blog entitled “Catastrophic Impairment Paediatric Traumatic Brain Injuries”.

Fact Scenario of the Case Study

The fact scenario for my case study is as follows:

• My client was a 17-year-old, indigenous girl, who was a passenger in a vehicle travelling at 100 km/hr in the Six Nations of the Grand River reserve.
• The driver lost control of the vehicle and crashed into a tree, which sent my client flying head-first through the windshield and causing severe head-trauma.

• The Brantford General Hospital was closeby, so the paramedics brought her there, where she was admitted as an inpatient.
• She also sustained multiple fractures to her spine, right elbow and right hand. 
• This prompted the physicians to transfer her to the Hamilton Health Sciences, which is a hospital network comprising seven unique hospitals.

• She was admitted as an inpatient to the Hamilton General Hospital (HGH), which is a Level 1 trauma centre.
• The radiologist used recognized brain diagnostic technology to conduct neuro-imaging tests, which revealed evidence of acute intracranial pathology.
• Example: acute subarchnoid hemorrhage in her interpeduncular and suprasellar cisterns, and large bilateral parietal and right frontal subgaleal hematomas.

• However, despite her head trauma she was not transferred to the Regional Rehabilitation Centre, which treats TBIs.
• Her multiple fractures triggered inpatient protocols, so she was transferred to the 6 South Surgical Trauma Centre in the HGH, so orthopaedic surgeons could perform immediate surgery on her spine, elbow and hand.

The Three Criteria for Section 3.1(1)5i

So, in order for my 17-year-old client to be granted the automatic CAT designation, she had to satisfy three criteria, as follows:

1. Inpatient admission to a public hospital in a Guideline;
2. Positive findings of intracranial pathology; and
3. The use of medically recognized brain diagnostic technology.

I initially assumed my client satisfied the three criteria, because she was admitted as an in-patient to the Hamilton General Hospital (Level 1 Trauma Centre), and a radiologist used medically recognized brain diagnostic technology to confirm she had positive findings of intracranial pathology. So, I got a medical opinion from a pediatric neuro-psychologist with a PhD.  The doctor arrived at the same conclusion as I, and submitted an OCF-19: Application for Determination of Catastrophic Impairment form to the insurance company.

The First Criterion: In-Patient Admission to a Public Hospital in a Guideline

If you take a closer look at the first criterion to be satisfied in section 3.1(1)5i of the Schedule, it states “admission, on an inpatient basis, to a public hospital in a Guideline”. So, this obviously begs the question: “What guideline?”

The June 2016, Catastrophic Impairment – Public Hospitals Guideline, Superintendent of Financial Services’ Guideline No. 01/16

The guideline that is being referred to is the June 2016, Catastrophic Impairment – Public Hospitals Guideline, Superintendent of Financial Services’ Guideline No. 01/16 (Superintendent’s Guideline 01/16). It was issued pursuant to subsection 268.3(1) and (1.1) of the Insurance Act, and was incorporated by reference in subparagraph 5i of subsection 3.1(1) of the Schedule.

The Superintendent’s Guideline No. 01/16 has a list of the 12 public hospitals for which inpatient admittance is the first criteria for determining whether an insured child has a TBI and a catastrophic impairment, and the list reads as follows:

1. Children’s Hospital of Eastern Ontario in Ottawa;
2. Hamilton Health Sciences (Regional Rehabilitation Centre) in Hamilton;
3. Health Sciences North in Sudbury;
4. Kingston General Hospital in Kingston;
5. London Health Sciences Centre in London;
6. McMaster Children’s Hospital in Hamilton;
7. St. Michael’s Hospital in Toronto;
8. Sunnybrook Health Sciences Centre in Toronto;
9. The Hospital for Sick Children in Toronto;
10. The Ottawa Hospital in Ottawa;
11. Thunder Bay Regional Health Sciences Centre in Thunder Bay; and 
12. Windsor Regional Hospital (Ouellette) in Windsor.

The reason these public hospitals are on the list is because admission of a child as an inpatient to them are sensitive indicators and clinical predictors of prolonged recovery and poor outcome.

The Ministry of Health and Long Term Care’s 11 Designated Lead Trauma Hospitals

The Superintendent’s Guideline No. 01/16 list was influenced by the 11 hospitals that the Ministry of Health and Long Term Care designated as Lead Trauma Hospitals in the early 1990s, which is listed as follows:

1. Windsor Regional Hospital in Windsor;
2. London Health Sciences Centre in London;
3. Hamilton Health Sciences in Hamilton
4. The Hospital for Sick Children in Toronto;
5. St. Michael’s Hospital in Toronto; 
6. Sunnybrook Health Sciences Centre in Toronto; 
7. Kingston General Hospital in Kingston;
8. Children’s Hospital of Eastern Ontario in Ottawa;
9. The Ottawa Hospital in Ottawa; 
10. Health Sciences North, Sudbury, North East; and 
11. Thunder Bay Regional Health Sciences Centre in Thunder Bay.

Again, these 11 aforementioned hospitals were designated by the Ministry of Health and Long Term Care as Lead Trauma Hospitals in the early 1990s.

Comparative Analysis

If you compare the two lists, you’ll notice that the Hamilton Health Sciences was removed and replaced with the Regional Rehabilitation Centre and the McMaster Children’s Hospital. 

In my fact scenario for this case study, my client was admitted as an inpatient to the Brantford General Hospital and the Hamilton General Hospital.

However, neither one of them are among the public hospitals listed in the Superintendent’s Guideline.

So, even though my client met the aforementioned second and third criteria of section 3.1(1)5i, and the insurer’s retained neurologist concluded that my client met all of the criteria, the insurer still denied my client an automatic CAT designation because they concluded that she didn’t satisfy the first criterion.

What do you do?

How do you strategically approach building a comprehensive, sound argument to either persuade the insurer to overturn its decision, or win at a Licence Appeal Tribunal if the insurer maintains its denial?

I’ll show you in the next section

I’m now going to discuss my deep dive approach to interpreting a section, which includes the following:

1. Appeal to common sense

2. Apply the Modern Approach to Statutory Interpretation

This requires you to know: 

• The Objectives and Purposes of Insurance Law; and
• The Intention of the Ontario legislature

3. Examine source documents, including: 

• Medical journals and the American Medical Association Guidelines referenced in the section;
• Dictionaries; and
• The definition section of the Schedule.

4. Examine source documents, including: 

• Medical journals and the American Medical Association Guidelines referenced in the section;
• Dictionaries; and
• The definition section of the Schedule.

Appeal to Common Sense

The first thing I do is approach issues like this from a common sense perspective. I start by asking myself the following question: “If I wasn’t a lawyer and someone told me about this problem on the streets, what would be my prima facie response?” After I assess the issue myself by approaching it from a common sense perspective, I then ask other people to help lend perspective while respecting solicitor-client privilege, such as the following people: 

• Non-lawyers, like my legal assistant;
• Physicians, like the paediatric neuropsychologist I consulted for my CAT case; and
• Healthcare professionals, such as an occupational therapist, who works on a lot of CAT cases. 

Again, I do this in order to get a different perspective. Non-lawyers also help me better grasp the grammatical and ordinary sense of the words of an Act or legislation I’m trying to interpret, as I’m reading in their entire context. So, when I took this common sense approach, I discovered several common sense observations with my CAT case. 

Common Sense Observations

I won’t discuss all of the common sense observations I discovered in my CAT case, but I’ll mention one observation, as follows: 

• If the admission of a child as an inpatient to the Level 1 Trauma Centres on the Superintendent’s Guideline list of public hospitals are sensitive indicators and clinical predictors of prolonged recovery and poor outcome, then why are some Level 1 Trauma Centres on the list and others are excluded? 

For example, the HGH is a Level 1 Trauma Centre, but it is not on the list. Its equivalent in London is the London Health Sciences Centre, which is also a Level 1 Trauma centre, and it is on the list. 

Draw Out Ridiculous or Frivolous Consequences

The next thing I do is apply my common sense observations to the other side’s interpretation of the section. I do this because further to the Supreme Court of Canada (SCC) case Re Rizzo & Rizzo Shoes Ltd., [1998] S.C.J. No 43, I want to draw out ridiculous, frivolous, unreasonable, inequitable, illogical or incoherent consequences, and things that are incompatible with the intent of the Ontario legislature, which logically follows the other side’s interpretation of the same section.

In Re Rizzo & Rizzo Shoes Ltd., [1998] S.C.J. No 43, the SCC noted the fundamental principle of statutory interpretation as it relates to absurd consequences, as follows:

It is a well established principle of statutory interpretation that the legislature does not intend to produce absurd consequences. According to Cote, supra, an interpretation can be considered absurd if it leads to ridiculous or frivolous consequences, if it is extremely unreasonable or inequitable, if it is illogical or incoherent, or if it is incompatible with other provisions or with the object of the legislative enactment (at pp. 378-80). Sullivan echoes these comments noting that a label of absurdity can be attached to interpretation which defeat the purpose of a statute or render some aspect of it pointless or futile (Sullivan, Construction of Statutes, supra, at p. 88).

So, again, I apply my aforementioned common sense observations to the other side’s interpretation of the section, in order to strategically draw out ridiculous or frivolous consequences that logically follow from the other side’s interpretation.

Applying the Common Sense Approach to Draw Out Absurd or Frivolous Consequences

So, I’ll now discuss how I’d draw out the absurd consequence using the first common sense observation.

If a child is involved in a MVA in London, and is admitted as an inpatient to the London Health Sciences Centre (Level 1 Trauma Centre) with the same positive findings of intracranial pathology as a child admitted as an in-patient to the Hamilton General Hospital (Level 1 Trauma Centre), the first child would be granted an automatic CAT designation, but the second child would not. This is absurd because it creates a problem with inconsistent outcomes. This is also absurd, inequitable and incompatible with the intent of the Ontario legislature because of the following:

• A child’s automatic CAT designation should be determined by utilizing a medical evidentiary basis to ensure that outcomes of the designation process are fair, reliable, accurate, consistent and predictable, and not strictly based on the location of the MVA and its close proximity to the public hospitals on the list.

After I use this common sense approach, I then start to take a closer look at the rules governing the modern approach to statutory interpretation.

Rules Governing the Modern Approach to Statutory Interpretation

Re Rizzo & Rizzo Shoes Ltd., [1998] S.C.J. No. 43, [1998] 1 S.C.R. 27 (S.C.C.) 

The starting point is the Supreme Court of Canada (SCC) case entitled Re Rizzo & Rizzo Shoes Ltd., [1998] S.C.J. No. 43, [1998] 1 S.C.R. 27 (S.C.C.). It dealt with the issue of whether the termination of the employment of employees, which was caused by the bankruptcy of an employer, gives rise to a claim in bankruptcy for termination pay and severance pay in accordance with section 40 and 40a of the Employment Standards Act, R.S.O. 1980, c. 137, ss. 40 and 40a. Therefore, the crux of the issue was the interpretation of the phrase “termination by an employer”.

The SCC noted that when dealing with benefits-conferring legislation, it is appropriate to use a broad and generous approach to interpreting the words of a section, and grasp a better understanding of the words through an examination of the entire context of the section and the legislation. It summarized the ideal approach of statutory interpretation at pg. 87, as follows:

Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.

The SCC also relied on section 10 of the Interpretation Act, R.S.O. 1980, c. 219, which stated the following:

The law shall be considered as always speaking, and where a matter of thing is expressed in the present tense, it shall be applied to the circumstances as they rise, so that effect may be given to the enactment according to its true spirit, intent and meaning.

The key takeaway in a CAT case like mine regarding the interpretation of section 3.1(1)5i and the Superintendent’s Guideline No. 01/16, was the following:

• Their words would be read in their entire context and in their grammatical and ordinary sense, harmoniously with the scheme and object of the Insurance Act and the Schedule, and the intention of the Ontario Legislature; and
• Section 3.1(1)5i and the Superintendent’s Guideline would be interpreted in a broad and generous manner that best ensures the attainment of the pith and substance of the Insurance Act and the Schedule’s true spirit, intent and meaning.

Ayr Farmers Mutual Insurance Co. v. Wright, 2016 ONCA 789, 134 O.R. 427 (Ont. C.A.).

I also analyzed the Court of Appeal for Ontario (ONCA) case entitled Ayr Farmers Mutual Insurance Co. v. Wright, 2016 ONCA 789, 134 O.R. 427 (Ont. C.A.). The primary issue was whether the claimant was involved in an accident as defined in the Schedule. The crux of the issue was the interpretation of the phrase “insured person”. The ONCA interpreted an “insured person” “as encompassing all persons claiming entitlement to benefits under the Schedule whether or not it is ultimately determined that they are entitled to benefits”.

More specifically, the ONCA stated the following:

The modern approach to statutory interpretation involves a textual, contextual and purposive analysis of the statute or provision in question.

Three factors must be examined: “the language of the provision, the context in which the language is used and the purpose of the legislation or statutory scheme in which the language is found”: Blue Star Trailer Rentals Inc. v. 407 ETR Concession Co. (2008), 91 O.R. (3d) 321, [2008] O.J. No. 2776 2008 ONCA 561, at para. 23.

In Amos v. Insurance Corp. of British Columbia, [1995] 3 S.C.R. 405, [1995] S.C.J. No. 74, at para. 17, Major J. observed that although statutory language cannot be stretched beyond its ordinary meaning, the statute cannot be construed in such a way that defeats the object and intent of the legislation providing coverage to the insured person.

Therefore, the ONCA emphasized three things, as follows: 

1. The centrality of a statute’s purpose; 

1. 1. The three factors that must be examined, which are: 
   2. The text or language of the provision;
   3. The context in which the language is used, and
   4. The purpose of the legislation or statutory scheme in which the language is found; and

2. Lastly, the importance of not interpreting words in a provision that is contrary to the legislation’s intent and object.

So, the takeaway was that in order to determine whether the first criterion of the automatic CAT definition is incompatible with both the object and scheme of the Insurance Act and the Schedule, and the intention of the Ontario legislature, a court would have to adopt the following:

• A textual, contextual and purposive approach to interpreting the first criterion of section 3.1(1)5i and the Superintendent’s Guideline.

Section 64 of the Legislation Act, 2006, S.O. 2006, c. 21, Sch. F

I also looked at sections 64(1) and (2) of the Legislation Act, 2006, S.O. 2006, c. 21, Sch. F, because they also provide additional guidance pertaining to the rules of statutory interpretation too.

For example, section 64(1) of the Legislation Act states the following:

“An Act shall be interpreted as being remedial and shall be given such fair, large and liberal interpretation as best ensures the attainment of its objects”. 

Section 64(2) of the Legislation Act, 2006 states the following: 

“Subsection (1) also applies to a regulation, in the context of the Act under which it is made and to the extent that the regulation is consistent with that Act”.

The key takeaway in my CAT case was the following: 

The court would also be required to view the Insurance Act and the Schedule as remedial and benefits-conferring legislation while interpreting section 3.1(1)5i in a fair,

• broad and liberal manner that best ensures the attainment of their intent and objects; and
• The rules governing the modern approach to statutory interpretation apply equally to the Schedule, which must be read in the context of its enabling Act, the Insurance Act.

Progressive Homes Ltd. v. Lombard General Insurance Co. of Canada, [2010] S.C.J. No. 33, 2010 SCC (S.C.C.)

I also analyzed the Supreme Court (SCC) case Progressive Homes Ltd. v. Lombard General Insurance Co. of Canada, [2010] S.C.J. No. 33, 2010 SCC (S.C.C.), which turned on the issue of insurance policy interpretation. It dealt with the issue of whether the insurer (Lombard) owed a duty to defend claims against the insured (Progressive). 

The SCC noted that the principle of contra proferentem, when the rules of construction fail to fix the ambiguity, is as follows:

The primary interpretive principle is that when the language of the policy is unambiguous, the court should give effect to clear language, reading the contract as a whole (Scalera, at para. 71)

Where the language of the insurance policy is ambiguous, the courts rely on general rules of contract construction (Consolidated-Bathurst, as pp. 900-902). For example, courts should prefer interpretations that are consistent with the reasonable expectations of the parties (Gibbens, at para. 26; Scalera, at para. 71; Consolidated-Bathurst, at p. 901), so long as such an interpretation can be supported by the text of the policy. Courts should avoid interpretations that would give rise to an unrealistic result or that would not have been in the contemplation of the parties at the time the policy was concluded (Scalera, at para. 71; Consolidated-Bathurst, at p. 901). Courts should also strive to ensure that similar insurance policies are construed consistently (Gibbens, at para. 27). These rules of construction are applied to resolve ambiguity. They do not operate to create ambiguity where there is none in the first place.

When these rules of construction fail to resolve the ambiguity, courts will construe the policy contra proferentem – against the insurer (Gibbens, at para. 25; Scalera, at para. 70; Consolidated-Bathurst, at pp. 899-901). One corollary of the contra proferentem rule is that coverage provisions are interpreted broadly, and exclusion clauses narrowly (Jesuit Fathers, at para. 28).

Therefore, the SCC noted the fundamental interpretive principle of contra proferentem when the language of a policy is ambiguous and general rules of contract construction fail to resolve the ambiguity. Namely, when a court construes a policy contra proferentem, coverage provisions are interpreted broadly, and exclusion clauses narrowly.

So, the key takeaway as it related to my CAT case, was as follows: 

• If the court is to construe the Superintendent’s Guideline No. 01/16 and the Schedule contra proferentem, then while interpreting the Superintendent’s Guideline No. 01/16 and section 3.1(1)5i of the benefits-conferring Schedule, it would broadly interpret the coverage component, and narrowly interpret the exclusion criterion that’s based on non-admittance of an inpatient to one of the public hospitals listed in the Superintendent’s Guideline No. 01/16.

Main Objective of Insurance Law: Consumer Protection

Smith v. Co-Operators General Insurance Co., [2002] 2 SCR 129

The next step, further to the Supreme Court of Canada (SCC), is to ensure that your interpretation is not contrary to the objective and purpose of insurance law and the statutory scheme.

So, what’s the main objective and purpose of insurance law?

The starting point is the SCC case Smith v. Co-Operators General Insurance Co., [2002] 2 SCR 129, which involved questions pertaining to statutory interpretation in the context of limitation periods in Ontario’s insurance law. In this case, the SCC recognized that the main objective of insurance law is consumer protection. The reason why the SCC recognized that the main objectives of insurance law is consumer protection, is as follows:

There is no dispute that one of the main objectives of insurance law is consumer protection, particularly in the field of automobile and home insurance. The Court of Appeal was unanimous on this point and the respondent does not contest it. In Insurance Law in Canada (loose-leaf ed.), vol. 1, Professor Craig Brown observed, “In one way or another, much of insurance law has as an objective the protection of customers” (p. 1-5). I note in this vein s. 279(2) of the Insurance Act which provides that any restriction on a party’s right to mediate, arbitrate, litigate, or appeal is void, except as provided in the regulations. Trust to that purpose of consumer protection, no refusal under s. 71 of the SABS can be said to have been given by an insurer if there has not been adequate compliance with that section.

…As I have mentioned above, insurance law is, in many respects, geared towards protection of the consumer. This approach obliges the courts to impose bright-line boundaries between the permissible and the impermissible without solicitude for particular circumstances that might operate against claimants in certain cases.

So, the takeaway was that consumer protection would be strongly considered in interpreting section 3.1(1)5i of the Schedule, and in doing so, a court would impose bright-line boundaries between: 

• The permissible, such as the Ontario legislature’s intent to improve the accuracy, clarity, predictive ability, reliability, and validity of the CAT designation process; and 
• The impermissible, such as inequitable discrimination based on geography, and absurd or frivolous consequences that are incompatible with the intent of the Ontario legislature.

Furthermore, a court would do so without undue solicitude for particular circumstances, such as a provincial bureaucratic glitch that operates against vulnerable and seriously injured automobile accident victims, who are in dire need of early access to the higher tier of accident benefits.

Good Faith Dealing and Peace of Mind

Whiten  v. Pilot Insurance Co., [2002] S.C.J. No. 19, 2002 SCC 18 (S.C.C.)

I also analyzed the Supreme Court of Canada (SCC) case Whiten v. Pilot Insurance Co., [2002] S.C.J. No. 19, 2002 SCC 18 (S.C.C.), which primarily dealt with what constitutes a permissible quantum of punitive damages in terms of how the means of arriving at the award are rationally proportionate to the primary purpose of retribution, deterrence and denunciation. This was of course the infamous bad faith case, where the jury awarded $318,352.32 in compensatory damages and $1 million in punitive damages to the plaintiff (Daphne).

The SCC discussed the main purpose of insurance contracts, which is to provide insureds with peace of mind, as follows:

Insurance contracts, as Pilot’s self-description shows, are sold by the insurance industry and purchased by members of the public for peace of mind. The more devastating the loss, the more the insured may be at the financial mercy of the insurer, and the more difficult it may be to challenge a wrongful refusal to pay the claim. Deterrence is required. The obligation of good faith dealing means that the appellant’s peace of mind should have been Pilot’s objective, and her vulnerability ought not to have been aggravated as a negotiating tactic. It is this relationship of reliance and vulnerability that was outrageously exploited by Pilot in this case. The jury, it appears, decided a powerful message of retribution, deterrence and denunciation had to be sent to the respondent and they sent it.

So, the key takeaway as it related to my CAT case, was that when deliberating on insurance contract disputes, courts must read in the entire context of the main purposes of insurance law, such as consumer protection and good faith dealing. The courts must do so with the objective of providing peace of mind to vulnerable insureds, such as catastrophically impaired children with severe traumatic brain injuries, who experience devastating unforeseen losses and uncertainty on how they’re going to pay for the exorbitant future care costs, so as to avoid undue stress and hardship.

Intention of Parliament (Ontario Legislature)

The next step, further to the Supreme Court of Canada, is to ensure that your interpretation is not contrary with the intention of the Ontario legislature. This obviously begs the question: “How do you learn about the Ontario legislature’s intention?” I answered this question by searching the Legislative Assembly of Ontario’s database for a Hansard script of the debates concerning Bill 251/15, which amended the Schedule on June 1, 2016. I also answered this question by carefully reviewing the Insurance Act, where I learned that every 3 years the Superintendent was required to submit a report to the Minister of Finance containing the Superintendent’s recommendations for amendments to the regulations. More specifically, further to section 417.1(1) of the 2010 Insurance Act, every 3 years the Superintendent to the Lieutenant Governor was required to “seek the views of interested persons on the operation of the regulations made under paragraphs 35 to 36.1 of section 12(1) and submit to the Minister a report containing the Superintendent’s recommendations for amendments to the regulations”.

Further to this requirement, in 2011, the Superintendent retained Dr. Pierre Cote to chair an expert medical panel for the purpose of making amendments to the definition of “catastrophic impairment”. This ultimately led to the “Superintendent’s Report on the Definition of Catastrophic Impairment in the Statutory Accident Benefits Schedule” (2011 Superintendent’s Report), and its recommendations to the Minister of Finance. It was this report that was submitted to the Lieutenant Governor in Council and then went before the Legislative Assembly of Ontario, which influenced the content of Ontario Regulation 251/15, and ultimately amended the Schedule on June 1, 2016. As such, this report provides great insight into, and aids in discerning, the intention of the Ontario legislature for the purposes of a statutory interpretation analysis.

Macro-Objectives Identified in the 2011 Superintendent’s Report

So, in my CAT case I reviewed the 2011 Superintendent’s Report to first identify macro-objectives, which are the overarching broader goals, that support my interpretation of the Guideline and section 3.1(1)5i of the Schedule.

I did this because in the spirit of a contextual analysis, the macro-objectives give context for the more specific micro-objectives of the Ontario legislature.

The macro-objectives I identified were as follows:

• A macro-objective and intention of the Ontario legislature was to maintain a proper balance between the needs of the most seriously injured automobile accident victims, who need access to the highest tier of accident benefits, and the affordability of insurance premiums to keep the closed insurance system sustainable;
• Protection of the catastrophically impaired insureds;
• Ensure that those who sustain the most serious injuries from automobile accidents are treated appropriately and in a timely manner;
• Make the catastrophic determination process more accurate, consistent and objective, by amongst other things, introducing elements of evidence-based medicine into the Ontario automobile insurance system;
• Speed up catastrophic impairment determinations and reduce transaction costs and disputes;
• Refine the qualifications and experience for catastrophic impairment assessors, and standardize and maximize the quality of assessments; and
• Introduce new measurement tools to improve the accuracy, relevance, clarity, validity, reliability and predictive ability of catastrophic impairment determinations.

Micro-Objectives Identified in the Superintendent’s Report

Lastly, I identified the micro-objectives and the purpose of the changes in CAT determinations for vulnerable children with severe traumatic brain injuries, in particular.

The micro-objectives that I identified were as follows:

• Introduce an automatic designation of catastrophic impairment for children (those under age 18) who are suffering from a serious traumatic brain injury and have been admitted to a major trauma centre.
• The Superintendent’s report noted that an automatic CAT designation would give claimants immediate access to the highest tier of benefits, thereby avoiding long waiting periods for a final determination, which could impose unnecessary stress on the families.  
• The Superintendent’s report noted that because a s.44 insurers examination would no longer be needed under this section, there should then be a reduction in the assessment and other transaction costs to the insurance system.

Identifying both the macro-and-micro objectives provided me with a better understanding of the underlying rationale for, and the intention of, the Ontario legislature.

The Original Recommendation for the Automatic CAT Designation in the Superintendent’s Report 

I then examined the original recommendations made by the panel of medical experts for the criteria of an automatic CAT designation for children, and then I compared and contrasted it to the language used in the current section 3.1(1)5i of the Schedule, which you can see in the table below.

Furthermore, in the aforementioned “Superintendent’s Report on the Definition of Catastrophic Impairment in the Statutory Accident Benefits Schedule”, the expert panel’s underlying rationale for in-patient admittance to a Level 1 Trauma Centre, was expressed as follows: 

“The Panel notes that certain objective markers of serious brain injury due to trauma are correlated to poor outcome. These markers also signal a need for extended rehabilitation resources in order to reduce the eventual impairment. In particular, the Panel finds that positive findings on a brain scan, coupled with admission to a major trauma centre, are good clinical predictors of a prolonged recovery and poor outcome”. 

In my scenario, my client was admitted as an in-patient to the Hamilton General Hospital, which is a Level 1 Trauma Centre, even though it wasn’t on the list of 12 public hospitals.

The Original Recommendation for the Automatic CAT Designation in the Superintendent’s Report 

In order to further understand the intent of the Ontario legislature, I also looked at the source documents that they referenced. For example, section 3.1(1)5 of the Schedule references a medical journal article written by Dr. Crouchman et al. called “A practical outcome scale for paediatric head injury, Archives of Disease in Childhood, 2001: 84: 120-124”. This article introduces the new measurement tool called the King’s Outcome Scale for Childhood Head Injury (KOSCHI), which the Ontario legislature adopted to improve the accuracy, validity, reliability and predictive ability of measuring a child’s level of neurological function for catastrophic impairment determinations. So, I carefully read the article to discover the contextual medical foundation for which the Ontario legislature was building its criteria for an automatic CAT designation for children with severe traumatic brain injuries (TBIs).

After reading the article I learned that Dr. Crouchman refined the KOSCHI scale by obtaining statistical data from observing inpatient management and outpatient follow-up of approximately 200 head injured children admitted to the paediatric wards of King’s College Hospital and the paediatric neurosurgical unit over the period 1990-1997. So, I wanted to see if there were any findings from his study that supported my interpretation, and contradicted the opposition’s interpretation. For example, Dr. Crouchman found that 90% of the children admitted as an in-patient to paediatric wards of King’s College Hospital (Level 1 Trauma Centre), with abnormal intracerebral radiological findings on computed tomography, had severe TBIs. This statistical data supported my claim that in-patient admission to the Hamilton General Hospital (Level 1 Trauma Centre) in combination with positive signs of intracranial pathology were sufficient to satisfy the three criteria, as they were objective markers and clinical predictors of prolonged recovery and poor outcome.

Evolution of the Catastrophic Impairment Definition

I then reviewed the evolution of the CAT definition from Bill 59 in the 1990s to June 1, 2016, in order to better understand the intention of the Ontario legislature. The underlying reasons for recent amendments to a particular regulation, such as the Schedule, aids in discerning the intention of the Ontario legislature for the purposes of a statutory interpretation analysis. I also did it to better appreciate the shortcomings of the old definitions that the Ontario legislature is trying to correct with the amendments. In my CAT case, I did this to highlight the fact that the shortcomings of the old reliance on the Glasgow Coma Scale (GSC), which spurred on the intention of the Ontario legislature to introduce new measurement tools, such as Dr. Crouchman’s KOSCHI Scale, in order to improve CAT determinations.

As I analyzed the shortcomings of the GCS, I learned that over time, when confounding GCS scores of 9 or less were obtained, the interpretation of the validity of many of those scores were highly disputed, which also resulted in increased costs in legal fees and medical expert reports, and ultimately led to inconsistencies in catastrophic impairment designations by arbitrators. This of course was contrary to the aforementioned macro-and-micro-objectives of the Ontario legislature I identified earlier, as articulated in the 2011 Superintendent’s Report, where the expert medical panel found that the “catastrophic” definition “over time created considerable uncertainty in the process of determining catastrophic impairments, often leading to inconsistent results, inaccurate diagnoses, and disputes”. As a result, the expert medical panel recommended that the GCS test “be eliminated due to the low predictability on the long term outcomes with respect to catastrophic impairment. In addition to being a poor predictive tool, the GCS has a number of inherent problems including inaccurate scores with patients who have consumed alcohol, are intubated or are too young to understand verbal cues”. The expert medical panel went on to recommend the use of the aforementioned Extended Glasgow Outcome Scale test as the replacement of the GCS, which again was consistent with the aforementioned intention of the Ontario legislature to introduce new scientific, measurement tools, in order to improve the accuracy, relevance, clarity, validity, reliability and predictive ability of CAT determinations.

Definition Sources

American Medical Association, Guides to the Evaluation of Permanent Impairment, 4th ed. (Chicago: American Medical Association, 1993).

Lastly, I look at other sources such as the American Medical Association, Guides to the Evaluation of Permanent Impairment, 4th ed. (Chicago: American Medical Association, 1993) (AMA Guides, 4th Edition), dictionaries, and the definition section of the Schedule, to assist with understanding the meaning of words at the heart of the interpretation dispute.

For example, the interpretation of the word permanent, is a common point of contention in the post-June-1-2016 decisions. The AMA Guides, 4th Edition defines permanent impairment as follows:

…impairment that has become static or well stabilized with or without medical treatment and is not likely to remit despite medical treatment. A permanent impairment is considered to be unlikely to change substantially and by more than 3% in the next year with or without medical treatment. If an impairment is not permanent, it is inappropriate to characterize it as such and evaluate it according to Guides criteria.

Therefore, an impairment is permanent when it is unlikely to change substantially and by more than 3% in the next year with or without medical treatment. This definition was instrumental in the case Applicant v. RSA Insurance, 2020 ONLAT, 19-000560/AABs, as it influenced the arbitrator’s judgment that the Applicant’s injuries met the CAT definition in accordance with section 3.1(1)1 of the Schedule. As such, it’s important that the physician you retain to complete your medico-legal expert report uses this definition. 

Synthesizing the Elements of the Modern Approach to Statutory Interpretation into a Coherent Argument

So, after we factor in the main objective of insurance law, the purpose of insurance contracts and the principle of contra proferentem, as articulated by the Supreme Court of Canada, and the intention of the Ontario legislature, as articulated by the 2011 Superintendent’s Report, we can begin to see that in regards to the interpretation of section 3.1(1)5i, an arbitrator would interpret section 3.1(1)5i in favour of my client by doing the following:

• Interpret narrowly, the exclusionary and ambiguous first criterion of section 3.1(1)5i in favour of my client;
• Interpret broadly, the coverage component of section 3.1(1)5i, pertaining to the automatic catastrophic impairment designation, in favour of my client;
• Interpret section 3.1(1)5i within the context of remedial and benefits-conferring legislation, in a generous manner, which best ensures the attainment of the pith and substance of the main objectives of insurance law and the purposes of insurance contracts, respectively, such as:
• Consumer protection; and
• Good faith dealing with the objective of providing peace of mind to vulnerable insureds who sustained catastrophic impairments and experienced devastating unforeseen losses, so as to avoid undue stress and hardship.

Furthermore, an arbitrator would interpret section 3.1(1)5i within the context of remedial and benefits-conferring legislation, in a generous manner, which best ensures the attainment of the pith and substance of the intention of the Ontario legislature, such as the following:

• Protect the needs of the most seriously injured automobile accident victims, who need access to the highest tier of accident benefits;
• Consumer protection of catastrophically impaired insureds;
• Ensure that those who sustain the most serious injuries from automobile accidents are treated appropriately and in a timely manner;
• Make the catastrophic determination process more accurate, consistent and objective, by amongst other things, introducing elements of evidence-based medicine into the Ontario automobile insurance system;
• Speed up catastrophic impairment determinations and reduce transaction costs and disputes;
• Refine the qualifications and experience for catastrophic impairment assessors, and standardize and maximize the quality of assessments;
• Introduce new measurement tools to improve the accuracy, relevance, clarity, validity, reliability and predictive ability of catastrophic impairment determinations; and
• Introduce an automatic designation of catastrophic impairment for children who are suffering from a serious traumatic brain injury and have been admitted to a major Level 1 trauma centre, such as the Hamilton General Hospital. 

These aforementioned points are aligned with the intention of the Ontario legislature as outlined in the 2011 Superintendent’s Report.

A Summary of My Argument

Further to the 2011 Superintendent’s Report, it was the original intention of the Ontario legislature to include all Level 1 Trauma Centres into section 3.1(1)5i of the Schedule, which includes the Hamilton General Hospital. As such, the absence of it was merely a bureaucratic glitch, especially when one considers it was included in the original list of 11 hospitals that the Ministry of Health and Long Term Care designated as Lead Trauma Hospitals, which influenced the list of hospitals in the Superintendent’s Guideline No. 01/16. The reason is because admission as an inpatient to a Level 1 Trauma Centre coupled with positive findings of intracranial pathology constitute objective and sensitive markers and clinical predictors of prolonged recovery and poor outcome. The reason is because the probability of a child’s TBI having a prolonged recovery and poor outcome is high, because there is a correlation with positive findings on a brain scan, coupled with admission to a major Level 1 trauma centre, which is supported by statistical data gathered by studies conducted by doctors such as Dr. Crouchman, who refined the KOSCHI scale – referenced in s. 3.1(1)5 of the Schedule – by observing inpatient management and outpatient follow-up of approximately 200 head injured children admitted to Level 1 Trauma Centers over a long period of time from 1990 to 1997.

To say that admission as an inpatient to the Hamilton General Hospital disqualifies my client because it’s not on the Guideline list, would lead to absurd, ridiculous and frivolous consequences, and would be extremely unreasonable and inequitable in a manner that is incompatible with the object of the legislative enactment and the intention of Parliament.

The Impact of Applying My Argument: Increasing the Policy Limits to $1 Million

I used this argument to persuade the insurer to retract their initial denial of a CAT designation for my client, which increased her policy limits from $65,000 to $1 million. I was happy with the result for my client and her family, but it didn’t feel like it was enough. I wanted to do more when I began to realize that the provincial bureaucratic glitch I uncovered, didn’t just adversely affect my client, but also other children with traumatic brain injuries (TBIs) who lived in rural communities and remote areas that were far away from the guideline’s list of 12 hospitals. 

I concluded that the Guideline’s interpretation of the new law had discriminatory ramifications based on geographic location, which had to be changed. 

I was reminded that as a lawyer, oral advocacy transcends beyond a legal retainer with a client, and extends out to the larger community and social justice issues. One decision for my client impacts the life of one child and her family. If, however, I was to change the law, then I would impact the lives of thousands of children and their families. It was at this pivotal moment that I decided I would change the law in Ontario.

So, I then used the same aforementioned argument to persuade the Financial Services Regulatory Authority of Ontario (FSRAO) to amend the Superintendent’s Guideline 01/16.

The Old Superintendent’s Guideline No. 01/16 has Been Amended

Again, I persuaded FSRAO to replace the old Superintendent’s Guideline No. 01/16 with the new “Guideline on Public Hospitals and Determination of Catastrophic Impairment”. The new Guidelines took effect on October 17, 2020. It interprets clause 5i of section 3.1(1) of the Schedule, as it applies to “a public hospital named in a Guideline” issued by FSRAO under section 268.3(1) of the Insurance Act, thereby changing the interpretation of the automatic CAT definition of children who sustained severe traumatic brain injuries. It deems any public hospital designated by the Critical Care Services Ontario, in partnership with the Ontario Ministry of Health, as Lead Trauma Hospitals.

So, now all Level 1 Trauma Centres, including the Hamilton General Hospital, are included in the public hospital list.

If you’d like more information the rationale and background of “Guideline on Public Hospitals and Determination of Catastrophic Impairment”, as well as FSRAO’s interpretation of it, then please click on the URL link below:

• https://www.fsrao.ca/industry/auto-insurance/regulatory-framework/guidance/guideline-public-hospitals-and-determination-catastrophic-impairment 

You can also direct any feedback, concerning the “Guideline on Public Hospitals and Determination of Catastrophic Impairment”, to contactcentre@fsrao.ca.

If you want more information on FRSAO’s guidance framework, then please click on the URL link below:

• https://www.fsrao.ca/regulation/guidance/fsra-guidance-framework 

I hope you found this case study in the Know Your Rights series to be valuable. Rudder Law Group’s website is your one-stop source for answers to all of your legal questions concerning catastrophic impairment law and personal injury law. Always remember: “It pays to know your rights now, because if you don’t, then you’ll pay to learn them later”.