$72,000 Part 7 Benefits Deduction Ordered Following Tort Trial

Reasons for judgement were published today by the BC Supreme Court, New Westminster Registry, ordering a reduction of a trial award by over $72,000 to account for paid or payable part 7 benefits.

In today’s case (Sangha v. Inverter Technologies Ltd.) the Plaintiff was injured in a collision.  Following a 10 day trial the Plaintiff’s claim was assessed at $215,380.  Subsequently the Defendants applied to have this assessment significantly reduced by part 7 benefits that were paid or payable to the Plaintiff.  In reducing the judgement by over  $72,000 Mr. Justice Riley provided the following reasons and provided significant weight and reliance on an ICBC adjuster’s evidence that such benefits would be paid:

[18]         A complicating factor is that the Regulations were recently amended. The applicable transitional provision states that treatment received before 1 April 2019 is dealt with under the old version of s. 88, and treatment received on or after that date is governed by the new version: Insurance (Vehicle) Regulation, B.C. Reg. 447/83, s. 104.2.

[19]         Ms. Sit’s affidavit indicates that Ms. Sangha has previously received temporary total disability payments of $37,500. Copies of cheques reflecting these payments are attached to the affidavit. Plaintiff’s counsel concedes that this amount should be deducted from the damages award.

[20]         The award for special damages included amounts for counselling, medication, and massage therapy expenses previously incurred by Ms. Sangha. Since these treatments were received prior to 1 April 2019, they are governed by the former version of the Regulations. Dealing with each of these items individually: 

a)    The special damages awarded in the Court’s reasons for judgment included a total of $2,300 for psychological counselling, for 23 sessions at a rate of $100 per session. There appears to be some ambiguity about the status of these expenditures under the old version of s. 88. Although Ms. Sit’s affidavit indicates that ICBC will pay the amount, she says they will do so under s. 88(1), when there is case law characterizing psychological counselling as a discretionary benefit under s. 88(2) of the pre-amendment Regulations: Plensky v. Di Biase, 2010 BCSC 1649 at para. 15; Boota v. Dhaliwal, 2008 BCSC 373 at para. 49. Thus, while Ms. Sit says ICBC will “irrevocably, unequivocally, and unconditionally” agree to pay all of Ms. Sangha’s previously incurred expenses under as Part 7 benefits, I foresee some difficulty in Ms. Sangha obtaining reimbursement. This is not a criticism of Ms. Sit’s integrity as a duly authorized ICBC representative, but rather a recognition that an insured person may encounter resistance in obtaining benefits where there is apparent inconsistency between ICBC’s presently-stated position and the requirements set out in the Regulations. The ambiguity on this particular point must be resolved in Ms. Sangha’s favour. I would not deduct this amount.

b)    The special damages award included a total of $1,916.16 for pain medications and anti-depressant medications. Medication taken at the direction of a medical practitioner has been characterized as a “necessary” medical service, making it a mandatory benefit under s. 88(1) of the former Regulations: Olson at para. 56. Ms. Sit’s affidavit indicates that ICBC will pay the full amount of Ms. Sangha’s expenditures on medication.

c)     The special damages included a total of $270 for massage therapy, for five sessions at a rate of $53.33 per session. Message therapy has been interpreted to fit within the term “physical therapy”, a mandatory benefit specifically listed under s. 88(1) of the pre-amendment version of the Regulations: Raguin v. Insurance Corporation of British Columbia, 2011 BCCA 482 at para. 56-59. Ms. Sit’s affidavit indicates that ICBC will pay the full amount of Ms. Sangha’s expenditure on massage therapy.

[21]         Thus, the defendants have satisfied their burden of establishing on a balance of probabilities that Ms. Sangha will receive a total of $2,086 in benefits in respect of previously incurred medication and massage therapy expenses, and that the damage award should accordingly be reduced by this amount.

[22]         The damages award included amounts for costs of future care falling into headings that correspond with future benefits the defendants say are covered or will be covered under Part 7 of the Regulations. In particular:

a)    The damages award included a total of $30,156.74 for anti-depressant and pain medications. Medication is now listed as a mandatory benefit under s. 88(1) of the Regulations. Ms. Sit’s affidavit indicates that ICBC accepts, going forward, that these medications will be reasonable and medically necessary in connection with the treatment of Ms. Sangha’s injuries, up to the amount specified in the court’s reasons for judgment.

b)    The damages award included a total of $800 for eight sessions of pain counselling at $100 per session. Pain counselling is covered by s. 88(1)(a) of the Regulations in their current form as evidenced by the inclusion of “counselling” as a health care service in Schedule 3.1, and the maximum amount per session is $120. Ms. Sangha’s affidavit indicates that ICBC will accept that this counselling is reasonable and medically necessary in connection with the treatment of Ms. Sangha’s vehicle-related injuries.

c)     The damages award included a total of $1,200 for 16 kinesiology sessions at a rate of $75 per session. This is also a mandatory benefit under the current version of s. 88(1) of the Regulations as evidenced by the inclusion of “kinesiology” as a health care service in Schedule 3.1, at an hourly rate that is higher than the amount used by the Court in its damages assessment. Ms. Sit’s affidavit indicates that ICBC will accept, based on the Court’s findings, that this therapy is reasonable and necessary in Ms. Sangha’s case.

d)    The damages award included a total of $950 for four occupational therapy sessions. Occupational therapy is a specifically listed mandatory benefit under new s. 88(1)(b). However, the rate is limited to $112 per hour. Ms. Sit’s affidavit says ICBC will accept that occupational therapy is reasonable and necessary in Ms. Sangha’s case and will pay the amount specified in the judgment. Notwithstanding this assurance, there is some uncertainty in respect of this category of benefits given that the Court’s reasons for judgment do not specify the number of hours per session, and the hourly rate per session in the Regulations is arguably less than that contemplated in the reasons. Adopting a cautious approach, I am not satisfied that Ms. Sangha will receive more than $448 on account of Part 7 benefits available under this heading.

e)    The damages award included a total of $240 for eight physiotherapy sessions at a rate of $30 per session. Physiotherapy is a mandatory benefit under the current version of s. 88(1) of the Regulations, as it is a listed health care service in Table 3.1, and the maximum rate per session is greater than the rate used by the Court in its damages assessment. Ms. Sit’s affidavit indicates that ICBC will accept the physiotherapy amount as reasonable and necessary in Ms. Sangha’s case and will pay the anticipated amount.

[23]         I should note that for treatment received after 1 April 2019, the Regulations now set limits on the number of sessions that will be covered under Part 7, unless ICBC is provided with written certification from a specified medical practitioner that additional treatment is required. In Ms. Sangha’s case, Ms. Sit, as a duly authorized ICBC representative, has given sworn affidavit evidence that ICBC waives the need for continued certification under s. 88(1.2) of the Regulations. Ms. Sit further asserts that she is authorized on behalf of ICBC to advise that ICBC will “irrevocably, unequivocally, and unconditionally agree to pay” the amounts specified above, as they are incurred by the plaintiff and submitted to ICBC by way of a claim for benefits under Part 7 of the Regulations.

[24]         Plaintiff’s counsel says in view of the recent flurry of legislative and regulatory changes to the ICBC system, the Court should be skeptical about whether benefits available under the system as it presently exists will continue to be available to Ms. Sangha in the future. Counsel says there is a real risk that benefits could be curtailed in the future, in a way that would deprive Ms. Sangha of damages already awarded to her in the Court’s reasons for judgment.

[25]         However, in this particular case, the bulk of the costs of future care award pertained to treatments and expenses intended to bring Ms. Sangha to maximal physical recovery and assist her to transitioning back into the work force in the near future. The only future care cost extending any appreciable time into the future is for anti-depressant medication. Although I am required to proceed cautiously in ascertaining future Part 7 benefits Ms. Sangha is likely to receive, I do not see any appreciable risk that the benefit scheme will be modified to significantly limit reimbursement for the cost of medication required to treat an insured person’s vehicle-related injuries. And the ICBC claims specialist has committed that ICBC will accept that the cost of Ms. Sangha’s anti-depressant medication, up to the total amount awarded in the judgment, is reasonable and necessary.

[26]         Plaintiff’s counsel raised another issue about the cost of medication going forward. In particular, counsel says there may be room for ICBC to argue that due to Ms. Sangha’s pre-existing depression, the future cost of her anti-depressant medications may be denied on that basis that they are not incurred “as a result of the injury” as required under s. 88(1) of the Regulations. Counsel cited Harvey v. Yanko, 2008 BCSC 1535 at para. 20-21, in which the trial judge declined to deduct the future costs of medication from the damages award based on a concern about the effect of a pre-existing condition. However, on the record before me, I find this theoretical concern to be fully addressed by the evidence. In the reasons for judgment, the Court found that as a result of the accident Ms. Sangha will have a life long need for anti-depressant medication, and then went on to reduce the total cost of anti-depressant medications by 30% to account for contingencies. Ms. Sit’s affidavit indicates that ICBC accepts the Court’s findings and agrees “irrevocably, unequivocally, and unconditionally” to reimburse Ms. Sangha for future costs of anti-depressant medications up to the amount specified in the judgment. Ms. Sit’s unchallenged evidence satisfies me that Ms. Sangha will in fact be reimbursed for costs of anti-depressant medication up to the amount specified in the judgment.

[27]         In summary, even under the cautious approach required by the case law, I am satisfied that it is appropriate to reduce the cost of future care component of the damages award on account of future benefits Ms. Sangha can expect to receive under Part 7 of the Regulations. Adding up items (a) through (e) above, the evidence indicates that Ms. Sangha can expect to receive a total of $32,844.74 in benefits for future treatment of her collision-related injuries.

[28]         On the basis of the evidence presented at trial and the affidavit evidence tendered on this application, I am satisfied that the defendants have proven on a balance of probabilities that Ms. Sangha has already received or will receive the benefits specified above, and that it is appropriate to reduce the damages award accordingly.

[29]         The total damages awarded to the plaintiff were $215,380.74. That amount is hereby reduced under s. 83 of the Act by $72,430.74, making the net judgment amount $142,950. Having already paid $181,407 to the plaintiff, the defendants are entitled to the return of the amount overpaid, namely $38,457.00.