Bad Drivers Shouldn’t Profit Off of Good Drivers’ Health Insurance

By Frank Pasternak

Imagine a law that will only benefit those people who do not have any health insurance and wrongdoers.

Well on February 13, Sen. Paul Farrow (who represents an area of Waukesha County that includes Pewaukee, Delafield, Hartland and Waukesha) and Sen. Glenn Grothman (who represents an area near West Bend and parts of northern Ozaukee County, including Port Washington and Cedarburg) did more than just imagine it; they introduced it. It’s Senate Bill 22, a law that would eliminate a long-standing rule of law in Wisconsin called the “collateral source rule.”

Basically, the rule says that benefits an injured person receives from sources that have nothing to do with the wrongdoer or “bad guy” causing the injury may not be used to reduce the bad guy's liability to the injured person. In other words, bad guys don’t get credit for benefits the injured person received just because the injured person was insured. This has been the law of Wisconsin for about 100 years.

The simple truth behind the rule is clear: wrongdoers should not benefit from the fact that the person they wronged was responsible enough to get insured. Unfortunately, however, as with many things, politics seems to have gotten in the way. Somehow, liability insurance companies like American Family, West Bend and others have convinced law makers, like Farrow and Grothman, that the bad guys should benefit from the fact that the injured person was responsible.

The law Farrow and Grothman have introduced will basically harm senior citizens, people who get insurance through their employer, and those on Medicaid. Ironically, the people who benefit from this law are those who do not have any health insurance and wrongdoers.

Let me explain: Say there’s a car accident where the wrongdoer ran a red light and caused four different people to incur $100,000.00 in medical bills each. All four suffered the same injuries and needed the same medical treatment. However, Victim #1 had no insurance, Victim #2 had Anthem BCBS through his employer, Victim #3 is a senior citizen on Medicare, and Victim #4 is a poor person on Medicaid.

Farrow and Grothman’s proposed law will allow into evidence the fact that Victim #2’s Anthem BCBS paid 80% of the bills due to contractual write-offs, the fact that Victim #3’s Medicare paid 60% of the bills, and Victim #4’s Medicaid paid 40% of the bills. As a result of Farrow and Grothman’s proposal, the recovery for medical bills will likely be:

1. Victim #1 $100,000 (the uninsured guy)
2. Victim #2 $80,000 (Employee with employer-sponsored health insurance)
3. Victim #3 $60,000 (Senior citizen with Medicare)
4. Victim #4 $40,000 (Poor person with Medicaid)

Now remember, the amount of the bills for all four people was the same $100,000. They all suffered the same injury in the same accident, but because of Farrow and Grothman’s proposed law, the bad guy causing the accident gets the benefit of the fact that Victim #2 was an employee with employer-sponsored health insurance, Victim #3 was a senior citizen on Medicare, and Victim #4 was a poor person on Medicaid. The other beneficiary of the proposed law would be Victim #1, the uninsured.

Under the current law, the red-light-running driver must pay the reasonable value of the injuries he caused, $400,000. Under the new proposal, the driver running the red light-will likely only pay, $280,000.

Under Wisconsin law today, the bad guy causing the accident does not get the benefit. The bad guy is simply responsible for the amount of the bills, assuming it is reasonable, and the only person who benefits is the person responsible enough to have insurance, the collateral source. Wisconsin law today says, rightfully, that bad guys do not get to benefit from good guys having insurance. The law today says that if anyone in this situation should benefit, it is the one who did not cause the accident. Surely, the one who caused the accident should not benefit.

Sadly, however, politics makes strange law, but I hope that’s not the case here. I believe in better. You deserve better. Sen. Grothman and Sen. Farrow should not support this law.

Email Sen. Paul Farrow at Sen.Farrow@legis.wisconsin.gov and Sen. Glenn Grothman at Sen.Grothman@legis.wisconsin.gov and tell them why they should not support this law. Tell Sen. Grothman and Sen. Farrow that this attempt to change Wisconsin’s 100-year-old law is unfair to Wisconsin citizens who are responsible enough to get health insurance.

The original version of this article is at Stand Up for Your Rights Wisconsin

Wisconsin Personal Injury Lawyer

Amendments to the Minimum Maintenance Standards - Part 1

The Minimum Maintenance Standards under the Municipal Act, 2001 were amended by Ontario Regulation 47/13, which came into effect on January 25, 2013.  Many of the amendments are a response to the Court of Appeal decision in Giuliani v. Halton (Regional Municipality), [2011] O.J. No. 5845 (C.A.) in which the court’s interpretation of the snow clearing and icy roadways standards limited their use as a defence to civil actions.  The amendments also provide more specific guidance to municipalities whose systems of winter road maintenance are based on the Minimum Maintenance Standards.  

In our next series of posts, we will be reviewing the changes to the MMS.

 

Part 1: New Definitions Added to Section 1

 

Section 1 of the MMS now contains the following definitions:

• “Ice” is defined as “all kinds of ice, however formed”.  Ice was not previously defined.
• “Snow accumulation” is defined as the natural accumulation of newly-fallen snow, wind-blown snow and/or slush that covers more than half a lane width of a roadway.  This definition was previously contained in the snow accumulation standard in section 4 of the MMS, which has been replaced as discussed below.
• “Substantial probability” is defined as “a significant likelihood considerably in excess of 51 per cent”.  This definition relates to patrols and maintenance activities that are done in anticipation of snow accumulation or ice formation, discussed below.  This definition may be the subject of debate in future civil cases, as it does not specify how much more than 51 per cent is “considerably in excess”.
• “Weather” is defined as “air temperature, wind and precipitation”.  Weather was not previously defined.

Examination for Discovery: Attendance of Parties

When a party has selected an individual to be examined on behalf of a corporation, is another corporate representative entitled to attend to observe discoveries?

In Cody v. Culley 2013 ONSC 199 (S.C.J.), the issue was whether a corporate representative could attend the examination for discovery of the individual chosen to be examined by the opposing party.  The plaintiffs argued that a corporation cannot have a different representative attend discoveries when the adverse party has selected a representative.  Master Glustein permitted the representative to attend.  A corporation has the right to attend examinations for discovery as an independent legal entity.  The corporate representative chosen by the adverse party is not required to have any decision-making power and a corporation may want someone at the discoveries who can decide litigation issues or at least report back to management for such decisions.  The attendance of such an individual could assist in the settlement process or provide more informed instructions to counsel.  The individual would not be attending to be examined, but to be the person who acts on behalf of the corporation to assist in the litigation decision-making process.

This decision could be useful to those representing corporate entities such as municipalities who wish to have a member of the Corporation observe discoveries to get a sense not only what the evidence might be but also how effective the witness may be.

Defendant Who Crosses Centre Line Prima Facie Negligent

The Court of Appeal has set aside a jury verdict that dismissed an action against a defendant who crossed out of his lane and collided with another vehicle.

In El Dali v. Panjalingham, 2013 ONCA 24 (C.A.), the plaintiff was injured in an automobile accident when the defendant lost control of his vehicle on an icy road, crossed the centre line, slid into oncoming traffic, and hit the plaintiff's vehicle.  The plaintiff remained on his side of the road and was able to bring his vehicle to a complete stop.  The police officer who attended the scene decided not to lay charges due to weather conditions.  The defendant did not testify at trial and called no other evidence to explain his driving.

A jury found there was no negligence on the part of the defendant and dismissed the case.  The plaintiff appealed.  The Court of Appeal allowed the appeal and ordered a new trial. The defendant breached s. 148 of the Highway Traffic Act by crossing the centre line of the road and a driver who does so is prima facie negligent.  The driver then bears the onus of explaining that the accident could not have been avoided with the exercise of reasonable care.  The explanation need not come from the defendant, but must come from someone or the defendant will be held at least partially responsible.  The fact the police officer did not lay charges and that there were icy road conditions were not sufficient to support the jury's conclusion.  Defence counsel suggested a 50% apportionment in her closing, which also suggested the defendant bore some responsibility.

Those defending similar claims will have to consider the appropriate evidence to call in order to rebut the onus to explain how the accident occurred without negligence.

Litigation Privilege - Production of Lawyer's Notes of Interview

A recent case deals with production of statements taken by an opposing party.  It provides a summary of the principles relating to litigation privilege.

In Hart v. Canada (Attorney General), 2012 ONSC 6067 (S.C.J.), the plaintiff brought a motion seeking production of notes that had been made by counsel for the defendant several years earlier when the plaintiff was a potential witness in another lawsuit arising out of the same factual nexus.  The notes appeared to be an almost verbatim translation of the interview.  The defendant argued the notes were protected by litigation privilege.  The Master ordered the notes to be produced and the defendant appealed.

The appeal was dismissed.  Litigation privilege cannot restrict disclosure of an opposing party's statements.  Information or statements that are obtained from an opposing party cannot be confidential from that party.  To the extent a document is a mere recording of information given by the opposing party, it is not subject to litigation privilege, even though it was created with a view to anticipated future actions; however, if the document contains something more that amounts to a solicitor's work product, then it is privileged.  Counsel for the defendant would be permitted to make a proposal to redact certain parts of the document that contained information that was more than simply a record of the plaintiff's interview and statement, such as margin notes, underlining and highlighting.

It appears that the key fact was that the notes contained an almost verbatim recording of the plaintiff's interview.  If the notes contained the solicitor's strategies or theories, the outcome may have been different.

Definition of "Accident" Under the SABS

How far can the definition of "accident" under the SABS be stretched?

In Dominion of Canada v. Prest, 2013 ONSC 92 (S.C.J.), the insured was washing his car and tripped over a curb sticking out from the wall of his parking garage.  He claimed that his right hand was touching the car as he fell, and therefore he was entitled to accident benefits.  Dominion sought a determination as to whether the incident met the definition of an "accident" within s. 3(1) of the SABS, which defines "accident" as "an incident in which the use or operation of an automobile directly causes an impairment."

Justice McNamara held that the incident was not an "accident".  He used the two part test set out by the Court of Appeal in Chisholm v. Liberty Mutual (2002), O.R. (3d) 776 (C.A.) and Greenhalgh v. ING (2004), CanLii 21045 (C.A.):

(a)  Did the incident arise out of the use or operation of an automobile (the “purpose test”); and

(b)  Did such use or operation of an automobile directly cause the impairment (the “causation test”).

Justice McNamara held that the vehicle was not being used or operated at the time of the incident and was not a direct cause of the impairment.  The use of the car had ended without injury being suffered and tripping over the curb was a new intervening act. The insured was not entitled to accident benefits, showing that there is indeed a limit to how far the definition can be stretched.

Loss Transfer - Cost of Assessments

Early this year, we blogged on a decision by Justice Greer holding that the costs of insurer generated assessments under s. 42 of the SABS are not recoverable under the loss transfer provisions (Wawanesa v. Axa).  The matter was appealed to the Court of Appeal.

The Court of Appeal decision is found at 2012 ONCA 592.  The Court dismissed the appeal.  Section 275(1) of the Insurance Act provides:

The insurer responsible under subsection 268(2) for the payment of statutory accident benefits to such classes of persons as may be named in the regulations is entitled, subject to such terms, conditions, provisions, exclusions and limits as may be prescribed, to indemnification in relation to such benefits paid by it from the insurers of such class or classes of automobiles as may be named in the regulations involved in the incident from which responsibility to pay the statutory accident benefits arose.

Justice Weiler held that the words "in relation to" convey a connection between two related subject matters.  A "connection" must be between statutory benefits paid and the cost of the assessment, and only exists if the ABs were actually paid.  If the assessment only saved some benefits from being paid unnecessarily there would be full indemnification, but no indemnification if no benefits were paid.  The legislature could not have intended such an anomalous result. In addition, the connection should be between insurer generated assessments and ABs paid to the insured, whereas the cost of the assessment is paid to the doctor who conducts the assessment.

Justice Blair wrote a dissenting opinion, preferring a wide scope to the words "in relation to" that would include the cost of assessments.

Giving the dissenting opinion, perhaps this matter will be headed to the Supreme Court for final clarification, especially given the rising costs of assessments.