CITATION: Marano v. Director of ODSP, 2017 ONSC 1604 DIVISIONAL COURT FILE NO.: DC-1600-930-000 DATE: 20170314

ONTARIO

SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

KITELEY, KRUZICK, and MYERS, JJ.

BETWEEN:

SERGIO MARANO

Appellant

– and –

DIRECTOR OF THE ONTARIO DISABILITY SUPPORT PROGRAM OF THE MINISTRY OF COMMUNITY AND SOCIAL SERVICES

Respondent

Jujhar Mangat, for the Appellant

No one appearing for the Respondent

HEARD at Oshawa: January 24, 2017

REASONS FOR JUDGMENT

F.L. MYERS J.

The Appeal

[1] This appeal is from the decision dated October 9, 2015 of the Social Benefits Tribunal established under the Ontario Works Act, 1997, SO 1997, c 25, Sch A. The appeal involves a consideration of the jurisdiction of the Tribunal to grant remedies on an appeal from a decision made by the Director of the Ontario Disability Support Program appointed by the Minister of Community and Social Services under the Ontario Disability Support Program Act, 1997, S.O. 1997, c. 25, Sch B.

[2] Mr. Marano does not appeal from the decision of the Tribunal rescinding the Director’s decision dated September 17, 2014 that found him financially ineligible for ODSP benefits. Rather, Mr. Marano asks the Court to find that as a result of rescinding the Director’s decision that he was ineligible to receive benefits, the Tribunal should have ordered the Director to pay him ODSP benefits from the date of his original application in September, 2012. Mr. Marano asks the Court to make the order that the Tribunal should have made.

[3] For the reasons that follow, the relief sought by Mr. Marano is granted in the terms set out at the end of these reasons. In addition, the Director is ordered to pay Mr. Marano’s costs on a partial indemnity basis fixed in the amount of $7,500.

The Proceedings before the Tribunal

[4] The Director did not participate in the appeal. While the Tribunal prepared a Record of Proceedings, as required by s. 31 (2) of the ODSP Act, there are gaps in the record that the Director might have been able to fill had it appeared in this appeal proceeding.

[5] The record before the Court shows that in September, 2012, Mr. Marano applied for benefits under the Ontario Works Act, 1997. It appears that he also applied for ODSP benefits at the same time although this is less clear. In its submissions to the Tribunal dated June 22, 2015, the Director made two inconsistent statements about the timing of Mr. Marano’s application for ODSP benefits. First, it wrote that:

At the time Mr. Marano was denied Ontario Works in 2013 he applied as a disabled person to the Ontario Disability Support Program (ODSP). His application was received on July 5, 2014 by the Disability Adjudication Unit (DAU). He was denied status and appealed this decision in December 2013 to the Social Benefits Tribunal…He was found disabled on July 9, 2014.

[6] However, in the next paragraph of its submissions to the Tribunal, the Director wrote that:

Mr. Marano appealed the decision of the Director’s September 19, 2012 decision [sic] to find him ineligible for ODSP because he did not provide information that was required to determine eligibility. This appeal was granted in the issuance of the Decision dated May 17, 2013.

[7] There is a decision of the Tribunal dated May 17, 2013 in the Record of Proceedings. From that decision, the Court can discern that Mr. Marano did indeed apply for ODSP benefits in September, 2012. In a decision dated September 19, 2012, the Director found Mr. Marano to be ineligible to receive ODSP benefits for failing to provide sufficient information to prove that he met the financial eligibility criteria of the programme. In its decision dated May 17, 2013, the Tribunal granted Mr. Marano’s appeal from the Director’s decision. It found that Mr. Marano’s failure to comply fully with the Director’s requests for information was reasonable and that in the interim, Mr. Marano had provided sufficient information to allow the Director to determine that Mr. Marano was financially eligible for ODSP benefits. The Tribunal therefore rescinded the Director’s decision of September 19, 2012.

[8] Counsel for Mr. Marano advised the Court that after the Tribunal’s decision, the Director decided that Mr. Marano did not suffer from a disability that qualified for ODSP benefits. In the fall of 2013, Mr. Marano appealed that decision to the Tribunal. The Tribunal set a hearing date for the appeal for July, 2014. However, by letter dated June 12, 2014, before the date for the appeal hearing arrived, the Director decided that Mr. Marano was medically eligible for ODSP benefits. That letter is in the Record of Proceedings before the Court.

[9] As a result, it appears that the Director’s first submission to the Tribunal that Mr. Marano applied for ODSP benefits in 2013 and that the Director found him to be medically eligible on July 9, 2014, were both mistaken. He had applied for ODSP benefits in September, 2012 and the Director decided that he was medically eligible on June 12, 2014 just prior to the hearing of his second appeal to the Tribunal.

[10] It appears further that ODSP benefits were not paid to Mr. Marano in June, 2014 despite being found to meet both the financial and medical eligibility criteria for the programme at that time.

[11] Again, according to the submissions made by the Director to the Tribunal below, Mr. Marano then filed a new application for ODSP benefits dated August 11, 2014. A copy of this application is in the Record of Proceedings at p. 29. There is no explanation as to why a “new” application was thought to be necessary or at whose instance it was required or submitted.

[12] By letter dated September 17, 2014, the Director once again decided that Mr. Marano was not financially eligible for ODSP benefits. The Director’s letter refers to the date of the “new” application as September 17, 2014 – the same date as the letter – rather than August 11, 2014.

[13] As required by the statutory scheme, the Director explained its reason for rejecting Mr. Marano’s “new” application as follows:

You have more assets than you are allowed to have as a single person. The most you can have in assets and still qualify for ODSP is $5,000. Right now you have $0.00 in assets.

[14] That is, the Director purported to decide that although the disabled appellant had no assets, he was ineligible for ODSP benefits because the value of his assets exceeded the statutory maximum of $5,000.

[15] The appellant’s request for reconsideration of the Director’s decision dated September 17, 2014 was rejected on October 10, 2014 without reasons.

[16] The appellant then appealed the decision of the Director dated September 17, 2014 to the Tribunal.

The Decision of the Tribunal

[17] In the decision dated October 9, 2015, that is the subject matter of this appeal, the Tribunal once again granted Mr. Marano’s appeal from the Director’s decision on Mr. Marano’s financial eligibility. It is fair to say that the Tribunal was critical of the Director’s position and of its conduct of the appeal before the Tribunal. At para. 36 of its reasons, the Tribunal found that the Director’s submissions before it were “misleading.” The Tribunal referred to the “scant and unpersuasive documentary evidence and written submissions” put forward by the Director. The Tribunal wrote:

[35] In rendering a decision in this matter, the Tribunal found that the flawed basis and wording of the notice of decisions issued by the Director as well as the glaring absence of any documentation supporting an asset in excess decision were certainly factors which were considered in the Tribunal’s decision and which supported a finding in favor [sic] of the Appellant.

[18] The Tribunal also rejected the Director’s submissions that Mr. Marano had failed to provide necessary financial information to the Director. The Tribunal held:

[40] The Tribunal found no evidence of any apparent request for property related information preceding the decision. Evidence in [Exhibit] R2 suggests the decision was made somewhat hastily – about the same date an ODSP staff person spoke to a bank manager. It is unclear to the Tribunal how this issue of ‘failure to provide information’ even materialized in this matter given the clear wording and references in the Director’s respective decision letters, which cites assets as a basis for the decision and not failure to provide information.

[19] In its ultimate decision, the Tribunal found that the Director’s decision that Mr. Marano had no assets was “certainly consistent with information contained in the application form (R1) signed and completed by both the Appellant and the Director on August 11, 2014.” It found the statement in the Director’s letter that the value of the appellant’s assets worth $0.00 exceeds the statutory maximum of $5,000 in assets was an “obvious error.”

[20] At para 44 of its reasons, the Tribunal noted even if the Director’s $0.00 finding was just a typographical error, there was a “complete absence of any other persuasive financial information showing how exactly the Appellant’s assets exceeded the $5,000 limit in September 2014.” The Tribunal discussed the state of the evidentiary record and found that a “reasonable person would assume that for the Director to have made such a decision in September 2014 there would have existed sufficient persuasive evidence to first support even arriving at such a determination.”

[21] The Tribunal concluded in para. 62 of its reasons that the Director’s decision “was premised on flawed reasoning and insufficient and vague evidence.”

[22] Therefore, the Tribunal rescinded the Director’s decision dated September 17, 2014 denying Mr. Marano’s eligibility for ODSP benefits based on the financial eligibility criterion for asset sufficiency. Mr. Marano was successful in this aspect of his appeal to the Tribunal.

Mr. Marano Claimed Additional Relief before the Tribunal

[23] Having once again succeeded in having the Tribunal set aside the Director’s finding that he was not eligible for ODSP benefits, Mr. Marano asked the Tribunal to order the Director to pay ODSP benefits back to September, 2012 when he first applied for them. He made reference to the earlier decision of the Tribunal dated May 17, 2013 and argued that the Director had not implemented that decision. He argued that once the Tribunal rescinded the Director’s first decision that ruled he had not provided sufficient information to establish that he met the financial eligibility criteria, the Director ought to have paid him ODSP benefits as required by the statute.

[24] At para. 65 of its reasons, the Tribunal referred to the Director’s written submissions (at p.153 of the Record of Proceedings) indicating that the decision of May 17, 2013 would not have been implemented until the Director accepted Mr. Marano’s medical eligibility for ODSP benefits in July, 2014. The Tribunal found due to the timing of the medical eligibility decision “…the Appellant was not provided with income support earlier.” (The medical eligibility decision was actually made in June, 2014 and not July, as noted above.)

[25] The Tribunal suggested that the fact that the Director’s decision to accept Mr. Marano’s medical eligibility was not made until June of 2014 may “lend some understanding as to the question of why the prior order of the Tribunal dated May 23, 2013 was not actioned.” However, rather than deciding the question of the date of Mr. Marano’s eligibility to start receiving benefits as he requested, the Tribunal held that it lacked jurisdiction to “consider an earlier matter and render a ruling regarding eligibility retroactive to September 2012.” Instead, it held that its jurisdiction was limited to assessing whether the Director’s September 17, 2014 decision rejecting Mr. Marano’s “new” application was correct or incorrect.

[26] In light of the Tribunal’s finding on the limits of its jurisdiction, it ultimately found that the Director’s decision of September 17, 2014 was not correct and it rescinded the Director’s decision that Mr. Marano was not eligible to receive benefits on the basis that his assets exceeded the $5,000 maximum prescribed amount. It did not order the Director to pay ODSP benefits to Mr. Marano or decide on Mr. Marano’s request that the Director be required to pay ODSP benefits effective from the date of his application in September, 2012.

[27] Mr. Marano’s counsel advised the Court that after the Tribunal’s decision was released on October 9, 2015, Mr. Marano’s case worker told him that payment of ODSP benefits would start effective September, 2014. That is, benefits were made effective the first month following Mr. Marano’s “new” application. Mr. Marano has since received a retroactive payment to that date and monthly benefits payments thereafter.

The Issue before the Court

[28] Mr. Marano takes great umbrage at the treatment he has received from the Director. He has been found to be disabled and financially eligible for benefits under the ODSP regime. Yet, the Director has resisted providing ODSP benefits throughout and has been unsuccessful in each of its decisions to reject Mr. Marano’s claim. While the Tribunal did question the Director’s failure to “action” its prior decision, Mr. Marano takes a more pointed view of government officials who fail to comply with their statutory obligations as ordered especially regarding payments under the Province’s social safety net.

[29] In this appeal, Mr. Marano argues that the Tribunal had the jurisdiction to order the Director to pay him ODSP benefits from the date of his initial application in September, 2012 and that it should have done so. He therefore asks the Court to order the Director to pay him ODSP benefits for the 23 months from September, 2012, the date of his first application, to August 2014, the month before payments commenced.

The Standard of Review

[30] Under s. 31 of the ODSP Act, appeals to this court are limited to issues of law. The standard of review of the Tribunal’s decisions of law is reasonableness rather than correctness. The Court may intervene only if it finds that the Tribunal’s decision on a question of law was not among the range of possible outcomes that was reasonably open to it. Edmonton (City) v. Edmonton East (Capilano) Shopping Centres Ltd., 2016 SCC 47, at paras. 27 – 31.

The Tribunal’s Jurisdiction

[31] The Tribunal’s appellate jurisdiction is set out in ss. 26 and 29 of the ODSP Act. Subsection 26 (1) provides as follows:

26 (1) In an appeal to the Tribunal, the Tribunal may,

(a) deny the appeal;

(b) grant the appeal;

(c) grant the appeal in part; or

(d) refer the matter back to the Director for reconsideration in accordance with any directions the Tribunal considers proper.

[32] In addition, s. 29 (3) of the ODSP Act provides:

(3) The Tribunal shall not make a decision in an appeal under this Act that the Director would not have authority to make.

[33] Subsection 26 (3) of the ODSP Act requires the Director to give effect to any directions that the Tribunal may make.

[34] The Court’s jurisdiction is set out in similar terms. The Court’s decision-making power is set out in s. 31 (5) with the same four choices as are available to the Tribunal with the exception that the Court may make directions to the Tribunal in addition to the Director. Subsection 31 (6) requires the Director and the Tribunal to give effect to the Court’s directions.

[35] In Surdivall v Ontario (Disability Support Program), 2014 ONCA 240, the Court of Appeal discussed the jurisdiction of the Tribunal under the ODSP Act. At para. 35 of the decision, the Court of Appeal described the vital public purpose served by this statutory scheme as follows:

The [ODSP Act] is social welfare legislation, serving some of the Province’s most impoverished and vulnerable residents. The statute contains a complex set of regulations, with detailed reporting requirements.

[36] In Surdivall, the issue involved the Director’s authority to forgive overpayments mistakenly made to ODSP benefits recipients. The Court of Appeal held that the Director has broad and flexible discretion under the ODSP Act. But the discretion is not unbounded. At para. 44 of Surdivall, the Court of Appeal wrote:

In my view ODSP will be accountable to the taxpayers of Ontario if public funds are spent fairly, honestly and reasonably. The Director’s discretion over the recovery of overpayments is not open-ended. It must be exercised reasonably taking account of a disabled recipient’s individual circumstances.

[37] At para. 73 of its decision, the Court of Appeal then found that the Tribunal has the same discretion as the Director and “has authority to make any decision the Director could have made.”

[38] In light of Surdivall, the Tribunal’s remedial jurisdiction was not limited to finding whether the Director’s impugned decision was correct or incorrect. When the Tribunal grants an appeal, the statute enables the Tribunal to make any decision that the Director could have made. Moreover, under s. 26 (1)(d), it may refer the matter back to the Director with directions for the implementation of its decisions so as to facilitate the fulfilment of the statutory scheme and purpose. The Tribunal’s finding that its jurisdiction was limited to a simple binary “yea or nay” decision represents an erroneous understanding of its statutory powers as interpreted by the Court of Appeal. As the decisions of the Court of Appeal are binding upon the Tribunal, the decision of the Tribunal was not within the range of possible outcomes that was reasonably open to it.

[39] In Zaki v. Director, ODSP, 2017 ONSC 1324, at para. 39, a panel of this Court held that the Director is bound by the “immediate effect” of the Tribunal’s decision. In that case, the Court found that the implicit logical effect of a decision by the Tribunal to rescind a decision that the applicant had failed to prove his financial eligibility for ODSP, was that he was eligible to receive ODSP benefits at least as of the date of the Tribunal’s decision. The Court held that benefits ought to have been paid to the applicant as a result of the Tribunal’s rescission of the Director’s decision. That is, the Director is required to recognize and give full force and effect to the Tribunal’s decisions.

Analysis of the Tribunal’s Remedial Jurisdiction and Order in this Appeal

[40] Given the Tribunal’s findings that:

(a) The Director had decided in June, 2014 that Mr. Marano was medically eligible to receive ODSP benefits; and

(b) The Director erred in deciding on September 17, 2014 that Mr. Marano was financially ineligible for ODSP benefits because he had too many assets;

the Tribunal effectively found that Mr. Marano had proven that he was both financially and medically eligible to receive ODSP benefits. As in Zaki, this is the natural inference and outcome of the Tribunal’s decisions which the Director was bound to implement.

[41] Once it rescinded the Director’s decision that Mr. Marano was ineligible, the Tribunal therefore had jurisdiction to order the Director to pay ODSP benefits to Mr. Marano. The Tribunal held that there was no basis for the Director to find either that Mr. Marano’s assets exceeded $5,000 or that he had failed to provide required information. In fact, the Tribunal criticized both the lack of evidence and what it viewed as misleading submissions made to it by the Director to try to support its decision to refuse to pay benefits to Mr. Marano. However, the Tribunal did not consider ordering the Director to pay Mr. Marano benefits because it found that it lacked the jurisdiction to do so. This was an error that the Court should correct.

[42] Mr. Marano first applied for ODSP benefits in September, 2012 - more than three years before the decision dated October 9, 2015 that is the subject of this appeal. Under s. 20 (1) of the ODSP Act, once a decision is made that an applicant qualifies for ODSP benefits, the Director is required to decide the effective date. Moreover, under the combined effect of s. 21 (2)(5) of the ODSP Act and s. 57 (5) of the General Regulation, a decision by the Director that sets an effective date that is after the date that an applicant’s application was completed is itself subject to appeal to the Tribunal. There is no appeal allowed where the Director decides to make the effective date for the commencement of benefits a date that is on or before the date of the completion of the application. It is logical to conclude from this that the default expectation is that payment of benefits will normally be made effective at the date the application was completed in that any decision to refrain from making payment retroactive to that date is seen as a deprivation that is deserving of an appeal right.

[43] As discussed at para. 65 of its decision, the Director explained in its submissions that it had not paid benefits to Mr. Marano after the Tribunal’s first decision on May 17, 2013 because Mr. Marano’s medical eligibility was not confirmed by the Director until July (actually June) of 2014. However, the Court now knows from Mr. Marano’s counsel that the Director has paid benefits to Mr. Marano retroactive to September, 2014, the month after his “new” application. That is, the Director did not make a decision on Mr. Marano’s eligibility date under his initial application despite its submission to the Tribunal.

[44] In my view, the idea that there were ever two applications is a red herring. There was no basis in the record for Mr. Marano to have had to file a “new” application. In fact, the Director’s submissions to the Tribunal and the Tribunal’s discussion on the remedial issues make clear that the Director’s finding on medical eligibility made in the initial application was used as part of the basis for finding Mr. Marano to be eligible to receive ODSP benefits in the purported “new” application. Mr. Marano’s medical eligibility was determined on June 12, 2014 which was two months prior to his “new” application on August 11, 2014. The Director’s submissions to the Tribunal merged the two applications and demonstrated that the Director treated the two applications as one and the same. (See pages 27 and 153 of the Record of Proceedings) The Director’s submissions establish that there was no substance to the “new” application in fact and in law.

[45] Furthermore, there is no basis in the record to limit the date of Mr. Marano’s eligibility for ODSP benefits to the date of his “new” application. By paying benefits only to the date of Mr. Marano’s new application, the Director avoided making a decision concerning the date of eligibility of Mr. Marano to receive benefits under the initial application. Mr. Marano had an appeal right if the Director decided that Mr. Marano would not be paid benefits effective at the date of the completion of his initial application. The Director put no evidence before the Tribunal indicating any basis to support a deviation from the default position as set out in the statute and the regulations. Yet, Mr. Marano has been denied the default position and he has been deprived of his appeal right by the Director making payment effective in September, 2014 purportedly under the “new” application rather than on the date of completion of his original application in September, 2012.

Conclusion

[46] As discussed at para. 41 above, the Tribunal ought to have ordered the Director to pay ODSP benefits to Mr. Marano as the immediate effect of rescinding the Director’s September 17, 2014 decision. The issue of Mr. Marano’s date of eligibility was put before the Tribunal by Mr. Marano and was the subject of submissions by the Director. The Tribunal had the jurisdiction to make any order that the Director could have made. Applying its duties as set out in Surdivall, the Director had no reasonable basis to limit Mr. Marano’s eligibility for benefits to September, 2014. The appropriate outcome to give effect to the Tribunal’s decisions and its reasons, and to ensure fair and proper compliance with the statutory scheme, is to order the Director to pay ODSP benefits to Mr. Marano effective September, 2012.

[47] Finally, I note that the Tribunal was critical of the Director’s failure to put sufficient evidence before it and for its attempt to mislead it. The Director did not participate at all in the appeal to the Court.

[48] Affidavits of service have been filed with the Court establishing that the appellant served the Director with his notice of appeal, factum, book of authorities, and certificate of perfection. The Director did not file a supplementary appeal record to fill-in the deficits of what is in the Record of Proceedings delivered by the Tribunal under s. 31 (2) of the ODSP Act. The Director did not file a motion to admit fresh evidence to try to put before the court decisions that it referred to in its written submissions but which the Tribunal doubted exist. The Director did not file a factum. No one appeared as counsel for the Director at the hearing. It appears that the Court’s staff did not send a copy of the Notice of Hearing to the Director as required. However, counsel for the appellant wrote to the Director’s office on January 23, 2017 referencing the time and place of the appeal hearing. Even if this was news to the Director, the Director should have arranged for counsel to appear if only to seek an adjournment.

[49] The inadequate state of the record is not Mr. Marano’s fault. He had no way to know that the Director would purport to limit his benefits to the date of completion of an unnecessary “new” application and thereby deny him of an appealable decision on eligibility under his initial application. There was nothing Mr. Marano could do other than to appeal each adverse decision and this is what he did. The decisions made and the explanations provided to the Tribunal, such as they were, were the responsibility of the Director.

[50] The Director has caused the appellant to incur the costs of this proceeding. It is therefore appropriate for the Director to pay Mr. Marano’s costs of this appeal on a partial indemnity basis.

Order

[51] The appeal is granted. Pursuant to ss. 31 (5) of the ODSP Act, the Director shall pay to Mr. Marano ODSP benefits effective from (and including) September, 2012 to (and including) August, 2014.

[52] The Director shall pay Mr. Marano’s costs within 21 days fixed in the amount of $7,500.

____________________ “Myers” Myers J.

I agree

___________ _______“Kiteley”

Kiteley J.

I agree

“Kruzick”

Kruzick J.

Date of Reasons for Judgment: March 14, 2017

Date of Release: March 14, 2017

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

KITELEY, KRUZICK and MYERS JJ.

BETWEEN:

SERGIO MARANO

Appellant

– and –

DIRECTOR OF THE ONTARIO DISABILITY SUPPORT PROGRAM OF THE MINISTRY OF COMMUNITY AND SOCIAL SERVICES

Respondent

REASONS FOR JUDGMENT

F.L. MYERS J.

Date of Reasons for Judgment: March 14, 2017

Date of Release: March 14, 2017