Written By: Dale Orlando and Brandon Pedersen, Student-at-Law
All auto insurance policies sold in the Province of Ontario include statutory accident benefits coverage. These are benefits that a policyholder is entitled to claim from their own insurer in the event that they are injured in a motor vehicle accident.
The statutory accident benefits schedule (SABS) includes coverage for medical, rehabilitation, and attendant care expenses. Medical/rehabilitative expenses are intended to cover reasonable and necessary expenses incurred by the injured person as a result of the motor vehicle accident for the purpose of reducing or eliminating the effects of any disability resulting from the impairment or to facilitate the person’s reintegration into his or her family, the rest of society and the labour market.
What is a Guardianship Order?
Many of our clients suffer moderate to severe brain injuries as a result of being involved in a motor vehicle collision. Often, these individuals do not recover sufficiently to be capable of instructing their lawyer during the process of applying for and dealing with disputes over entitlement to statutory accident benefits. People who are “mentally incapable” of making decisions about their property or personal care are classified as “people under disability.” The definition of “mentally incapable” is found in the Substitute Decisions Act, and says that a person is “mentally incapable” where he or she is not able to understand information relevant to making a decision about the management of his or her property or personal care, or he or she is not able to appreciate reasonably foreseeable consequences of a decision or lack of decision about the management of his or her property or personal care.
If a person is “under disability” by means of being “mentally incapable,” a guardianship order must be obtained in order for counsel to represent the interests of the incapable individual. In these situations, the Court will typically appoint a family member to act as the guardian of property and personal care for the incapable person. However, there are significant costs associated with the application process to the Court. The question is whether the costs associated with obtaining a guardianship order are required to be paid under the statutory accident benefits schedule.
In Stukic v Personal, the Court found that an insurer is liable under s. 16 of SABS to pay the expense of obtaining a guardianship order for an insured who is catastrophically impaired and not able to deal with his person or property. The Court stated:
[O]ne of the purpose tests in s. 15(2) the obtaining of the guardianship order was a measure undertaken “to reduce or eliminate the effects of any disability resulting from the impairment.” It is conceded, and established as a condition of obtaining the guardianship order, that the insured is not able to make decisions. Obviously, he cannot communicate a decision he is unable to make. The guardianship order gives him a voice and mind by or through which he can legally authorize or request other rehabilitation goods and services, instruct counsel, deal with the government, deal with the insurer and commit to expenses such as transportation and accommodation.
As per the alternative test in the same subsection, the obtaining of a guardianship order was a measure undertaken “to facilitate the insured person’s reintegration into his or her family, the rest of society and the labour market.” Through his guardian, he can request visitors, arrange to visit others, go to a multitude of places and do a multitude of things he could not do if it were not for his guardian ascertaining his wishes and best interests and making the arrangements.
However, as is required for all medical and rehabilitation benefits, the legal fees associated with the application for appointment of a guardian or property are only payable by the auto insurer if the applicant first submits a treatment plan in advance of incurring the expense and the insurer approves the treatment plan.
 Stukic (Litigation Guardian of) v Personal Insurance Co. of Canada, 2005 CarswellOnt 3476 at paras 25–26.