COURT FILE NO.: 229/07

DATE: 20090325

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

B E T W E E N:

FAY C.F. TANG

Plaintiff/Appellant

• and -

ELON JARRETT

Defendant/Respondent

C. P. Goldson, for the Plaintiff/Appellant

Ryan Stewart Breedon, for the Defendant/ Respondent

HEARD at Toronto: March 25, 2009

BELLAMY J.: (Orally)

1This is an appeal from the order of Godfrey J. of the Toronto Small Claims Court dated April 17, 2007 in which the trial judge dismissed the plaintiff’s claim for $5,782.76. I have jurisdiction to hear this appeal, pursuant to s.31 of the Courts of Justice Act, R.S.O. 1990, c.C.43.

2An appeal from a judge is governed by the standards outlined in Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235. Questions of law are reviewed for correctness. Findings or inferences of fact should be given deference and only a palpable and overriding error will justify interference. Questions of mixed fact and law are subject to a standard of palpable and overriding error, “unless it is clear that the trial judge made some extricable error in principle with respect to the characterization of the standard or its application, in which case the error may amount to an error of law”.

3There are two key issues here:

(i) Was there a contract between Dr. Tang and Mr. Jarrett?

(ii) Was there unjust enrichment?

4Mr. Jarrett is an injured worker. He lost three fingers in a workplace accident on June 23, 2000. The Workers & Safety Insurance Board (WSIB) approved psychological treatment for him. He received this treatment from the appellant, Dr. Tang. However, the WSIB only approved a limited number of sessions, twelve to be exact. Dr. Tang, at the request of Mr. Jarrett’s paralegal, provided treatment without payment from the WSIB. She now seeks payment of her unpaid account of $5,782.76 from Mr. Jarrett directly.

5Dr. Tang’s evidence was that Mr. Jarrett’s representative, paralegal Ralph Calcagno, promised to see that she would be paid by the WSIB. Dr. Tang was aware that prior approval was necessary before the WSIB would pay, but she testified that Mr. Calcagno begged her to treat Mr. Jarrett, who needed her services.

6Dr. Tang takes the position that her only recourse is against Mr. Jarrett because only he can make the WSIB pay. She believes that only the worker can object to a refusal to pay for treatment and she has provided me with a case in which the predecessor to the WSIB would not allow her to sue it. At trial, she testified that she knew the WSIB could refuse to pay even if an objection was entered, and that there was an appeal procedure.

7Mr. Jarrett’s evidence was that he was always clear that he could not afford to pay for any treatment directly and that any queries about the outstanding invoices were directed to his agent, who in turn reassured Mr. Jarrett not to worry, that the bills would be paid. Mr. Jarrett knew he only had twelve treatments approved, but since he needed more treatments, he asked his agent to get him more. Mr. Calcagno told him to continue in treatment. Mr. Jarrett was also aware of the appeal procedures, but left that to Mr. Calcagno whom he believed to be competent until his disappearance some time later. He also admits he got benefit from the treatment.

8With respect to the first issue: Was there a contract between Dr. Tang and Mr. Jarrett?

9Dr. Tang does not say Mr. Jarrett breached a promise to pay for services. She says that the contract was that Mr. Jarrett would pursue his WSIB appeal, and that this promise was breached. So, in essence, she submits there was an implied contract between the parties and it was an error on the part of the trial judge not to find that to be the case.

10Without a doubt there was no signed contract between Dr. Tang and Mr. Jarrett. He made it perfectly clear that he would not be able to pay for any of the treatment. While his paralegal apparently said that he, the paralegal, would pursue payment from the WSIB, Dr. Tang knew that Mr. Jarrett himself would not be able to pay. She also knew that Mr. Calcagno was not saying that he himself would pay.

11It appears from the transcript that Mr. Jarrett is mostly functionally illiterate. Pretty much everything he did with the WSIB was done through his paralegal. So, when Mr. Calcagno said he would look after any appeals to WSIB, Mr. Jarrett believed him. Mr. Calcagno can no longer be located and has been charged with a criminal offence or offences. Mr. Calcagno does not appear to have filed the necessary appeals to the WSIB to ensure that Dr. Tang could be paid, and Mr. Jarrett himself didn’t know how to read or write enough English to do it himself. In any event, Mr. Calcagno kept telling him not to contact the WSIB office, that he would do it himself.

12The result on the evidence is this: there was no contract between Dr. Tang and Mr. Jarrett, nor was there any implied contract between them. The evidence disclosed that it was Mr. Calcagno who said that WSIB would pay or that he would take responsibility for ensuring they did pay. Throughout the evidence, it is clear that Mr. Jarrett repeatedly told Dr. Tang that he would not personally be able to afford to pay her for the treatments. None of the above makes Mr. Jarrett a party liable under a contract.

13If there was an implied contract between them – and I do not believe there was – it was not that he would pay for service, but that he would pursue his appeal rights at the WSIB to ensure she was paid by them. The Small Claims Court can only award damages. It cannot force Mr. Jarrett to pursue his appeal.

14As a result, I conclude that the trial judge was correct in finding there was no contract or implied contract, nor did the trial judge commit a palpable and overriding error in applying the facts to the case.

15Was there unjust enrichment? Dr. Tang argues that it was an error for the trial judge to find that WSIB, not Mr. Jarrett benefited from the treatment especially if Mr. Jarrett admitted he benefited from the treatment.

16The respondent here submits that unjust enrichment is an equitable cause of action and that s.93(3) of the Courts of Justice Act precludes the Small Claims Court from granting equitable relief. I believe that argument has been answered by this court in 936464 Ontario Ltd. v. Mungo Bear Ltd. (2003), 2003 72356 (ON SCDC), 74 O.R. (3d) 45 (Div. Ct.).

17Regardless, in my view, there should be no restitution here. Dr. Tang knew that Mr. Jarrett could not pay. She has had many cases involving WSIB and admitted before the trial judge that she was well aware of what the rules are in terms of WSIB coverage. She knew that approval was to be received before undertaking any further treatment of Mr. Jarrett.

18I see no error made by the trial judge. As he said, not every benefit, in itself, creates an unjust enrichment and this one does not. This is not a benefit within the meaning of the tri-partite test for unjust enrichment as that has been defined in Garland v. Consumers Gas Co., 2004 SCC 25, [2004] 1 S.C.R. 629; Peter v. Beblow, 1993 126 (SCC), [1993] 1 S.C.R. 980, or Peel (Regional Municipality) v. Ontario, 1992 21 (SCC), [1992] 3 S.C.R. 762. The WSIB may have benefited in not having to pay out of insurance funds for the treatments received, but that is not the issue.

19Dr. Tang knew Mr. Jarrett would not pay, so there could be no reasonable expectation he would. Dr. Tang cannot now expect him to pay, when she provided services knowing the WSIB would not pay, and that there was no guarantee they would. This is the risk she undertook.

20Again, I find that the trial judge did not err, so the appeal is dismissed.

21Before ending though, I just want to add something, and if need be, feel free to give my comments to the appropriate people. It seems to me that the trial judge felt that both parties were under the impression that WSIB was the party that was principally liable for the account. From the transcript, it seems that both parties may also have been the subject of unscrupulous actions on the part of a paralegal named Ralph Calcagno who seems to have been charged with a criminal offence or offences.

22Now, I don’t know whether this is possible, but it may be that under the circumstances, the WSIB might be prepared to extend Mr. Jarrett’s time to appeal the decision, (or if that is possible, maybe even entertain an appeal by Dr. Tang either on her behalf or on Mr. Jarrett’s behalf, and extend the time to appeal). I say this because it seems to me that these are special circumstances. Here are two affected people under the very clear impression given by Mr. Calcagno that he himself was making all the necessary arrangements for Dr. Tang and Mr. Jarrett.

23Perhaps counsel for Mr. Jarrett would be kind enough to determine whether that can be done. This is not an Order on my part, but it does seem a shame that a caring psychologist who agreed to payments to treat someone who obviously needed help should find herself out-of-pocket for over $5,000.00 when clearly the patient was not ever able to pay for this treatment, and equally clearly an unscrupulous person who can’t be found made representations that he would make sure the psychologist was paid.

COSTS

24Costs in the amount of $500.00.

BELLAMY J.

Date of Reasons for Judgment: March 25, 2009

Date of Release: March 27, 2009

COURT FILE NO.: 229/07

DATE: 20090325

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT