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Catastrophic Definition: Ontario Court of Appeal Decision of Kusneirz v. Economical Mutual

On December 23, 2011 the Ontario Court of Appeal, with a panel of three, issued their decision on the case of Kusneirz v. Economical Mutual by overturning the October, 2010 decision of Justice Lauwers from the Superior Court of Justice. The appeal decision allowed for the combining of psychological and physical impairments declaring Kusneirz catastrophically impaired. 

For claims staff handling automobile claims with catastrophic applications this decision is very significant. The long argued issued of whether 2 (1.1)(f) and 2(1.1)(g) of the SABS should be combined to assess the overall body impairment  has been decided by the Court of Appeal. The appeal panel preferred the interpretation of Spiegel J. in Desbiens v. Mordini, [2004] O.J. No. 4735 (S.C.)In their decision they provided this direction for legal interpretations of the AMA guides: 

   "In my view, the Guides’ examples are illustrative, rather than exhaustive.  In at least five places, the Guides      recommend that physicians refer to Chapter 14 in assessing the total impairment of persons suffering from both physical and behavioural/mental impairments.  These recommendations reflect the principle that a total impairment assessment must take both physical and psychiatric impairments into account.  There is nothing in the text of the Guides to suggest that this principle should be limited to persons with mammary gland or disfigurement problems.  Accordingly, it seems to me that combining physical and psychiatric impairments can be done “in accordance with” the Guides."


When counsel for Economical Mutual were asked by the appeal court whether combining f and g (the psychological and physical) would increase the entitlement to catastrophic, the court was advised:

  "At oral argument, the respondent conceded that there are only a very few cases where there are permanent physical impairments and permanent psychiatric impairments that are not catastrophic if assessed separately, but are catastrophic if assessed together.  Accordingly, the class of persons entitled to “catastrophic impairment” benefits will remain small under either interpretation."  

It would be interesting to ask insurers handling claims this question. Invariably, the minor accident with minor soft tissue injuries lead to a percentage of cases that apply for catastrophic entitlement based on psychological impairments. This leads to uncertainty and increased claims costs for Ontario insurers and policy holders.

    

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