Adjudicator Rules on Sufficient Documentation for IRB Calculation

In the recent Licence Appeal Tribunal (“LAT”) decision Parameswaralingam v. Echelon General Insurance Company (19-005907/AABS), Adjudicator Lake ruled that although the Applicant was entitled to income replacement benefits (“IRBs”), the Tribunal was unable to quantify the amounts owed based on the documentation provided to the Respondent and/or Tribunal.

On July 30, 2018, the Applicant was injured in a motor vehicle accident and sought benefits pursuant to the Statutory Accident Benefits Schedule (“SABS”).

The Applicant submitted their Disability Certificate (OCF-3) on April 25, 2019, and as such, the Tribunal ruled that the Applicant’s entitlement to IRBs was to commence on April 25, 2019.   The Applicant opined that the weekly IRB payable was $254.80, which was based on their earnings during the four weeks before the accident from K.R.S.R. Mobile Wash Corporation.

The Respondent advised that they were unable to calculate the quantum of the IRBs owed to the Applicant based on the documentation provided.  Specifically, the Respondent was provided with an Employers Confirmation Form (OCF-2) from K.R.S.R Mobile Wash Corporation, a 2017 Tax Return and 2019 T4 Statements of Remuneration from three additional employment sources indicating that the Applicant had returned to work at some point in 2019.

Adjudicator Lake ruled that the documentation provided failed to provide sufficient information (i.e. timing of amounts earned) in order to accurately quantify the Applicant’s pre-accident and post-accident income.  The Applicant also submitted a 2017 Tax Return that reported total earnings of $5,740.  Adjudicator Lake pointed out that the 2017 Tax Return does not offer information as to when the amounts reported on the tax return were actually earned.  Adjudicator Lake noted from the Tribunal’s August 28, 2020 Case Conference Report and Order, that the Respondent requested the Applicant provide their 2017 to 2019 Tax Returns by November 13, 2020. However, the only documentation received regarding the 2018 Tax Return was correspondence from CRA dated March 26, 2019 advising that the 2018 Tax Return had not yet been filed (we have not been advised whether the return has since been filed as the 2018 tax return was not technically due until April 30, 2019).

The Adjudicator cited Section 4(5) of the SABS, and excluded any income earned by the Applicant during 2018 in the calculation of their pre-accident income, including any amounts outlined on the OCF-2 from K.R.S.R. Mobile Wash Corporation.

Adjudicator Lake ruled that due to the fact that the Applicant did not provide details regarding the timing of their pre-accident income earned, nor did they provide sufficient details regarding the timing of their post-accident income earned, the Tribunal was unable to determine the quantum of the weekly IRBs owed as the Applicant did not meet their burden of providing sufficient evidence.

When quantifying an IRB for an employed and/or self-employed claimant, understanding the timing of their pre-accident and post-accident income is integral to an accurate and fair calculation.  A tax return or T4 Statement of Remuneration is not always sufficient when quantifying a claimant’s pre-accident / post-accident income.  Asking questions early about the timing of earnings prior to and subsequent to an accident will allow for a clear understanding of a claimants IRBs owed, if any.

Read the decision in full detail here: Parameswaralingam v. Echelon General Insurance Company (19-005907/AABS)