WORKER'S COMPENSATION BOARD OF BRITISH
DECISION OF THE APPEAL DIVISION
Oct. 15, 2002
|PANEL APPOINTED:||SUSAN MARTEN|
 This decision arises from the worker's request for an increase in his pension wage rate. The worker suffered a compensable injury on October 2, 1995, resulting in a severe head injury, as well as significant physical injuries. In a decision dated September 1, 1999, a claims adjudicator in the disability awards department at the Worker's Compensation Board ("the Board") awarded the worker a loss of earnings pension, effective December 1, 1997. The worker's pension was based upon 75% of the difference between his assessed average earnings of $2,500.00 per month and earnings of $234.00 per month in employment that the Board considered suitable and reasonably available. The worker's permanent functional impairment was assessed at 80% of a totally disabled person, consisting of an award of 60% of total disability for psychological impairment and 20% of total disability for physical impairment.
 In findings dated October 17, 2001, the Worker's Compensation Review Board (the "Review Board") found that the worker's pension should be assessed on the basis of a 100% loss of earnings. The Review Board upheld all other aspects of the worker's pension award.
 The worker was a principal of a limited company at the time of his injury. He and his wife were the only directors and officers of the company. The company was incorporated in 1993. The worker and his wife reported equal amounts of employment income from the company, to the Board and on their income tax returns. The worker now requests that the Appeal Division conclude his employment income was greater than previously asserted. He requests that a portion of the income reported by his wife be re-allocated and included in his pension wage rate.
 Whether the Board appropriately determined the worker's average earnings, for the purposes of his pension entitlement.
 The worker does not dispute the percentage of disability awarded, the effective date of his pension, or the Review Board's finding that he should receive a pension on a 100% loss of earnings basis. I have reviewed those components of the worker's pension award, and find insufficient reason to disturb the Review Board's findings on those issues.
 On balance, I accept the weight of the evidence is that the worker's wife was not an equal participant in the worker's business, such that it is not reasonable to conclude that she earned 50% of the declared employment earnings. I accept that the income splitting was done for tax purposes, and that the worker and his wife accepted the advice of their accountant in that regard. I accept that a variation to the manner in which the earnings were reported is warranted. I consider the weight of the evidence supports that some portion of the income allocated to the worker's spouse was the income of the worker. The worker and his wife were the only shareholders and officers of the company. They shared a common household. As stated by their accountant, it was their practice to draw funds as needed, and then meet and discuss the allocation of income.
 Having so stated, I do not, however, accept that the worker's wife's role was as minor or nominal as argued by the worker's representative. I accept that her contribution to the company incuded the tasks set out in her statutory declaration. I therefore accept that the worker's wife performed clerical/office/reception duties, and at times delivered and picked up supplies. She also did some bank deposits. Although her role may have declined at the time of the worker's injury, because of her focus on the task of caring for three young children, I consider that she remained available, as needed. I accept that she was not present at the jobsite. At the same time, her statutory declaration described her daily tasks, but also stated that one of the reasons for incorporation was to secure her interest in the family asset. I consider it reasonable to conclude that the weight of the evidence supports that she and her husband would have discussed the overall performance and direction of the company.
 On balance, I consider that the weight of the evidence supports that one-half of the worker's wife's reported 1995 income, or $15,000.00, should be included in the worker's average earnings. I realize that such a determination is no more than an estimate, but only rough estimates have been provided in the statutory declarations. Those estimates are not confirmed by supporting documents, other than the assertions contained in the statutory declarations. The accountant considered it difficult to place a precise market value on her services. I have placed weight upon the accountant's evidence, including that a critical factor in the determination of the allocation of wages between the worker and his wife was the tax implications. He understood from discussions with the worker and his wife that the worker's wife performed clerical/office/reception duties, "at the time of incorporation of their business and subsequent thereto" and, in addition, that the services provided by the worker's wife were of a wide variety, and varied from time to time. I accept this evidence, which I consider supports that the worker's wife continued to play more than a minor or nominal role in the company business.
 The worker's appeal is allowed, in part, and to the following extent.
 I conclude that the weight of the evidence supports that one-half of the earnings reported by the worker's wife, or $15,000 should be included in the worker's average earnings.
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