April 22, 2016

They Giveth, and They Taketh Away; But Not This Time! – Attendant care benefits given to a family member providing care is not income.

T.C. v. Personal Insurance Company of Canada, (FSCO A13-009880), Arbitrator Fadel
 

Daniel MacDonald

Daniel Macdonald

Personal Injury Lawyer

 

The issue in this case is whether attendant care benefits given to the applicant by her injured son constituted post-accident income, and thus could be deducted from income replacement benefits the applicant was receiving.

The applicant, T.C., suffered psychological injuries as a result of a motor vehicle collision involving her son C.C. who sustained life-threatening injuries when struck as a pedestrian on October 31, 2012.  T.C. was unable to return to work as a result of being diagnosed with major depressive disorder, an adjustment disorder and PTSD. As a result of her injuries she was entitled to ongoing income replacement benefits, quantified at $400.00 weekly.  These benefits started on November 7, 2012.

C.C. required 24-hour attendant care supervision and the support and supervision required was provided by T.C.  On February 28, 2013 the insurer determined that C.C. sustained a catastrophic impairment.  C.C. received attendant care benefits of $6000 per month which he gave to his mother T.C.  The insurer took the position that the money T.C. received from C.C. for providing attendant care was “income from self-employment”.

Pursuant to section 7(3) of the Accident Benefits Schedule an insurer may deduct from an income replacement benefit 70 percent of any income received from self-employment earned after the accident.  In this case, the insurer said the money received was post-accident income and reduced the income replacement benefit of T.C. to zero.

T.C. argued that she was not in a self-employment situation and that the money was not income.  Instead the attendant care money that C.C. gave to her was akin to a gift or allowance between family members.

Arbitrator Fadel looked to the definition of “self-employed person” in the Schedule and found that the care provided by T.C. did not meet the definition.  A self-employed person has to be engaged in a type of business, which the Arbitrator took to mean some form of commercial enterprise.  Here, the evidence was that T.C. would provide the same level of care even if there was no attendant care monies, T.C. had not declared the money as income on her tax returns, that she had no flexibility in her hours as C.C. needed supervision at all times, and that she had never provided care to her son with a view to a profit.

T.C. was found not be engaging in a business.  She was providing care to her child, where monies happen to be available under a policy of insurance, to reimburse her for doing so.  The money received was thus held not to be income from self-employment for the purposes of s.7(3) of the Schedule.

Application

This is a good decision for families.  Taking care of a child, parent, or other loved one is not a business.  Those who make the sacrifice to provide care should not be penalized for doing so.  It is nice to see a decision where that is the case.

 

If you have questions or comments about this edition of the newsletter, contact Daniel Macdonald at Legate & Associates: d.macdonald@legate.ca