Insurance - Auto - Income Replacement Benefits. Waterloo Insurance v Switzer
In Waterloo Insurance v Switzer (Div Court, 2023) the Divisional Court canvassed SABS income replacement benefit law regarding employed and self-employed claimants:
Analysis. Traders General Insurance Company v. Rumball
 IRBs are addressed in Part II of the SABS, in ss. 4 – 11. The eligibility criteria are in s. 5. There is no issue that the respondent sustained an impairment as a result of the accident, a requirement for eligibility. Subsection 5(1) then distinguishes between eligibility for employees and for self-employed persons:
5.(1) The insurer shall pay an income replacement benefit to an insured person who sustains an impairment as a result of an accident if the insured person satisfies one or both of the following conditions:...
1. The insured person,
i. was employed at the time of the accident and, as a result of and within 104 weeks after the accident, suffers a substantial inability to perform the essential tasks of that employment, or
ii. was not employed at the time of the accident but,
A. was employed for at least 26 weeks during the 52 weeks before the accident or was receiving benefits under the Employment Insurance Act (Canada) at the time of the accident,
B. was at least 16 years old or was excused from attending school under the Education Act at the time of the accident, and
C. as a result of and within 104 weeks after the accident, suffers a substantial inability to perform the essential tasks of the employment in which the insured person spent the most time during the 52 weeks before the accident.
2. The insured person,
i. was a self-employed person at the time of the accident, and
ii. suffers, as a result of and within 104 weeks after the accident, a substantial inability to perform the essential tasks of his or her self-employment. [Emphasis added.]
 There is no issue that the respondent was a self-employed person at the time of his accident and for the relevant period prior to the accident.
 Subsection 5(1) distinguishes between employed persons (addressed in s. 5(1)1) and self-employed persons (addressed in s. 5(1)2). Subsection 5(1) allows for the possibility that an employed person may also be self-employed. However, the respondent was self-employed only.
 The respondent is eligible under s. 5(1)2 as a self-employed person, not under s. 5(1)1.
 The above eligibility provisions have a role in determining the quantum of IRBs. Section 4 addresses income using the eligibility categories from s. 5 and incorporates the possibility (which does not arise here) that a person may have been both employed and self-employed in the relevant time periods:
4.(1) In this Part, The Adjudicator applied s. 4(2)3. The Adjudicator erred in overlooking the s. 5(1)1 i requirements of s. 4(2)3, which are not met by the respondent. Subsection 4(2)3 applies to people described in s. 4(2) i – people who qualify under s. 5(1) 1 i – not the respondent.
(2) The gross annual employment income of an insured person is determined as follows:
1. In the case of a person referred to in subparagraph 1 i of subsection 5 (1) who was not a self-employed person at any time during the four weeks before the accident, the person’s gross annual employment income is whichever of the following amounts the person designates:
i. The person’s gross employment income for the four weeks before the accident, multiplied by 13.
ii. The person’s gross employment income for the 52 weeks before the accident.
2. Subject to paragraph 3, the person’s gross annual employment income is his or her gross employment income for the 52 weeks before the accident if,
i. the person qualifies for a benefit under subparagraph 1 i of subsection 5 (1) and was a self-employed person at any time during the four weeks before the accident, or
ii. the person qualifies for a benefit under subparagraph 1 ii of subsection 5 (1).
3. If the person described in subparagraph 2 i was self-employed for at least one year before the accident, the person may designate as his or her gross annual employment income the amount of his or her gross employment income during the last fiscal year of the business that ended on or before the day of the accident.
(3) A self-employed person’s weekly income or loss from self-employment at the time of the accident is ...
(4) A self-employed person’s loss from self-employment after an accident is … [Emphasis added.]
 The Adjudicator therefore erred in law in proceeding under s. 4(2)3. Subsection 4(2)3 is available only if the person qualifies for a benefit under s. 5(1)1 i and was a self-employed person at any time during the four weeks before the accident.
 In this case, the Adjudicator ought to have proceeded under s. 4(3), which provides as follows:
A self-employed person’s weekly income or loss from self-employment at the time of the accident is the amount that would be 1/52 of the amount of the person’s income or loss from the business for the last completed taxation year as determined in accordance with Part I of the Income Tax Act (Canada). Subsection 4(4) may also be applicable.
 Unfortunately, due to the above error, there is no adequate analysis of the correct subsections or the evidentiary record (including expert evidence) from which to proceed. While there may be overlap between arguments and evidence for the different subsections, this court is not in a position to fully address the matter. The other issues raised on this appeal will therefore not be addressed. This matter must be sent back for a fresh hearing, allowing for additional evidence, based on these legal principles.
In Traders General Insurance Company v. Rumball (Div Court, 2022) the Divisional Court considers an auto insurance SABS issue, here the issue of the test for disability after 104 weeks of disability:
 The words of a statute will always be open to judicial interpretation. An insured is entitled to receive an income replacement benefit so long as he or she meets the definition of disability in s. 6 of the Schedule.
 An insured person is disabled when he or she “suffers a substantial inability to perform the essential tasks of his or her employment or self-employment”. The disability test changes 104 weeks after the accident. No longer is the test one which requires the insured to establish a substantial inability to perform the essential tasks of his or her employment. Rather, the test is more stringent. It requires the insured to demonstrate that because of the accident he or she is “suffering a complete inability to engage in any employment or self-employment for which he or she is reasonably suited by education, training or experience”.
 Counsel for Ms. Rumball argues that a proper interpretation of the post-104 disability test includes an assessment of what is “reasonably suitable employment”. It is argued that reasonably suitable employment must be commensurate with the insured person’s pre- accident employment in nature, stature and remuneration. In support of that argument, heavy reliance is placed on Burtch.
 In his Reasons in Burtch, Juriansz J.A. at para. 24 makes it clear that the proper test to establish post-104 entitlement to an income replacement benefit is the one in the Schedule. While it is accepted at para. 22 of his Reasons that it is quite proper for arbitrators at FSCO (now the LAT) and for trial judges to consider earlier jurisprudence interpreting the post-104 test, those decisions are not binding on the court. Ultimately, at para. 24 Juriansz J.A. concludes that:
... It is not necessary that the insured person be formally qualified and able to begin work immediately in order for a particular employment to be considered a reasonably suitable alternative. A job for which the insured is not already qualified may be a suitable alternative if substantial upgrading is not required. Burtch was cited for the proposition that “suitable employment” means employment in a competitive, real-world setting, considering an employer’s demands for reasonable hours and productivity, and that the work must be comparable in terms of status and wages. A careful reading of Burtch does not support that proposition. In fact, the insured in Burtch was employed as a general labourer pre-accident. His employment position required him to do heavy lifting, drive a vehicle and receive instructions from his employer. He earned $25,000 per annum. He argued at trial there was no reasonably suitable employment alternative. The trial judge made a factual finding that long haul trucking was a suitable alternative despite the fact he lacked formal qualifications for this type of employment. Despite making this factual finding, the trial judge concluded the insured met the post-104 test for disability. The Court of Appeal reversed the decision of the trial judge because “the trial judge’s findings simply did not support his conclusion that the respondent was suffering from a complete inability to engage in any employment for which he is reasonably suited by education training or experience under s. 5 (2) (b) of the Schedule...”
 I do not accept that Burtch incorporates any other disability test other than that set forth in s. 6 of the Schedule. While the Court of Appeal endorses reference to earlier jurisprudence, including cases from FSCO and now the LAT, as clarifying how specialized tribunals interpret and apply the Schedule, those decisions are not binding on the court. While those decisions include as part of the post-104 disability test a test that suitable employment means employment in a competitive, real-world setting, considering an employer’s demands for reasonable hours and productivity and a test that the work should also be comparable in terms of status and wages, we do not accept that is the test set forth in the Schedule. As such this court, being bound by the decision of the Court of Appeal in Burtch, concludes that the only test to be applied in establishing an entitlement to post-104 IRBS is the one set forth in the Schedule and it does not include employment in a competitive, real-world setting, nor does it include any test that suitable employment should be comparable in terms of status and wages.
 The Adjudicator in this case heard the evidence and made a factual determination that Ms. Rumball had reasonable suitable alternative employment available to her, specifically the evidence as it related to her work as a wedding planner and the evidence that she had some functional ability to work in the retail sector. While counsel for Ms. Rumball takes issue with the factual findings of the Adjudicator as they relate to the medical evidence, those findings are not reviewable on this appeal. Furthermore, even if those findings of fact were reviewable, it is noteworthy that the evidentiary foundation for Ms. Rumball’s claim that she was disabled was grounded in the evidence called on her behalf.
 The onus was on Ms. Rumball to establish that she was disabled and met the test of post-104 disability as set forth in the Schedule. At the very least, where the hearing was being heard in March 2020, it was incumbent on the moving party to put before the decision maker evidence, including opinion evidence, that was not only persuasive but also timely. In this case, apart from the evidence of the family doctor, the expert evidence came from two medical doctors whose reports were prepared in 2017. The conclusions reached by the Adjudicator as they relate to this opinion evidence were not only supported by the evidence but also a matter of common sense. In addition, where the disability test speaks to “suitable alternative employment”, I question why Ms. Rumball chose not to call any evidence from a vocational expert. Ms. Rumball had the onus in this case and the evidence did not meet that onus.