In the recent preliminary issue decision Kellerman-Bernard v. Unica Insurance Inc., the LAT held that an applicant not involved in an accident cannot meet the criteria for a catastrophic impairment as defined by the SABS.
In Kellerman-Bernard v. Unica Insurance Inc., the applicant’s child was involved in an accident on January 26, 2016. The applicant sought benefits due to psychological injuries she sustained as a result of her child’s accident pursuant to the Statutory Accident Benefits Schedule – Effective September 1, 2010. The parties agreed that the applicant met the definition of an insured person under the SABS, and was entitled to claim benefits generally. The issue was whether the applicant was eligible to claim a catastrophic designation as a result of her daughter’s involvement in an accident.
The relevant legislation in place at the time defined a catastrophic impairment as follows: “For the purpose of this Regulation, a catastrophic impairment caused by an accident is,” followed by a list of six categories of physical, brain, mental and behavioral impairment. Vice-Chair Farlam determined that, pursuant to this provision, a catastrophic designation requires a two part test to be met: the threshold test, where the applicant must establish that his or her injuries are “caused by an accident”; if the threshold test is met, the applicant must then establish that his or her injuries fit within at least one of the listed categories of impairment.
Vice-Chair Farlam held that the applicant in this case failed the threshold test. She accepted the respondent’s submission that the phrase “caused by an accident” was purposely used to restrict catastrophic entitlement to persons who directly suffer injuries caused by an accident. In interpreting the meaning of the phrase “caused by an accident”, Vice-Chair Farlam relied on the definition of “accident” in the SABS (“use or operation of an automobile directly causes an impairment…”). She held that the applicant’s alleged injuries were not directly caused by an automobile as she was not directly involved in the accident, nor did she witness her child’s accident. She concluded that the interpretation was consistent with the modern approach to statutory interpretation mandated by the Supreme Court of Canada. This approach considers the language of the provision, the context in which the language is used, and the purpose of the legislation or statutory scheme where the language is found.
The issue before Vice-Chair Farlam was a novel issue. That is, there were no previous LAT decisions directly on point. LAT decisions have no precedential value, and it is unclear whether other adjudicators will agree with Vice-Chair Farlam’s interpretation. The term “caused by an accident” is quite broad, and it seems at the very least possible that other adjudicators may determine that the pre-June, 2016 provision encompasses insured persons who suffer psychological injuries caused by a child’s involvement in an accident (or another person as defined in section 3(1)(a)(ii) of the SABS).
It is also worth noting that the post-June 1, 2016 amendment to the SABS changed the catastrophic impairment threshold portion of the definition to the following: “For the purposes of this Regulation, an impairment is a catastrophic impairment if an insured person sustains the impairment in an accident…” (emphasis added). While this new provision has not been analyzed by the LAT to date, the argument that a person must have been “in an accident” to claim a catastrophic impairment designation appears to be stronger based on the wording of the amended provision.
Rebecca Brown Greer is the author of this blog and member of the Catastrophic Loss practice group at the firm. If you have a question about this decision or a similar file, please contact Rebecca at 647-427-3339.