Birmingham Business Centre Inc. v. Intact Insurance Company, 2018 ONSC 6174

CITATION: Birmingham Business Centre Inc. v. Intact Insurance Company, 2018 ONSC 6174

DIVISIONAL COURT FILE NO.: DC-16-0037-00 DATE: 20181015

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

SACHS, HORKINS, THORBURN JJ.

BETWEEN:

BIRMINGHAM BUSINESS CENTRE INC.

Plaintiff/Applicant

– and –

INTACT INSURANCE COMPANY

Defendant/Respondent

Kenneth Wise, for the Plaintiff/Applicant

Anthony Bedard, Defendant/Respondent

HEARD at Brampton: October 15, 2018

SACHS J. (Orally)

[1]

Introduction

This is an application to judicially review an appraisal award made pursuant to section 128 of the Insurance Act, R.S.O. 1990 c.I.8. The basis for the application is an allegation of reasonable apprehension of bias on the part of the umpire.

[2]

Legal Principles

The test to be applied when considering an allegation of reasonable apprehension of bias is set out by the Supreme Court of Canada in Weywaykum Indian Band v. Canada, 2003 SCC 45, [2003] 2 S.C.R. 259 at para. 60:

. . . the apprehension of bias must be a reasonable one, held by reasonable and right minded persons, applying themselves to the question and obtaining thereon the required information. In the words of the Court of Appeal, that test is “what would an informed person, viewing the matter realistically and practically — and having thought the matter through — conclude. Would [that informed person] think that it is more likely than not that [the decision-maker], whether consciously or unconsciously, would not decide fairly.”

3In Austin v. Ontario Racing Commission, 2017 ONCA 587, at para. 37, the Ontario Court of Appeal has made it clear that determining whether a reasonable apprehension of bias exists requires taking into account “the statutory schemes and normative contexts” that governed the particular decision at issue.

4There have been a number of cases that have commented upon the unique statutory scheme and context that govern the award under review see Krofchick et al and Provincial Insurance Co. Ltd. et al, 1978 1304 (ONSC); Barrett et al and Elite Insurance Co. et al, 1987 4160 (ONCA); Seed v. ING Halifax Insurance et al, 2005 41991 (Div. Ct); Madhani v. Wawanesa Mutual Insurance Company, 2018 ONSC 4282 (Div. Ct.).

5What emerges from these cases is the following:

(1) The purpose of this appraisal process is to provide an expeditious and easy manner for the settlement of claims for indemnity under insurance policies. It is intended to be a final and binding determination of the loss.

(2) Courts have afforded substantial deference to an appraisal under the Insurance Act and the appraisal process. Unless there is proof of misconduct or that the appraisers or umpire exceeded their jurisdiction courts have been reluctant to interfere

(3) The appraisal process established by the Insurance Act is considered to be a valuation not an arbitration.

(4) The appraisal process is not adjudicative in nature. The process is based on discussion and on the sharing of expertise in valuation. Appraisers can arrive at a decision based on their own knowledge and expertise.

(5) An appraisal is not subject to the provisions of the Statutory Powers Procedure Act, R.S.O. 1990 c. S.22.

(6) An appraisal under s. 128 of the Insurance Act requires neither a hearing, a consideration of evidence nor reasons.

[6]

Analysis

Keeping these principles in mind, we turn to the specific allegations of the Applicant:

(1) She was given insufficient time to present her case.

(2) The appraiser appointed by the insurer was allowed to challenge the evidence of the insurer’s own consultant.

(3) The umpire met privately with the appraiser appointed by the insurer.

7With respect to the first argument, since the process does not require a hearing at all, an allegation of insufficient time to present one’s point of view cannot be a basis for setting aside a decision of this kind. In coming to this conclusion, we note the following:

(a) Both parties submitted extensive information in writing.

(b) There was a site attendance.

(c) On its face, the award that was made reflects a process of give and take on the part of both parties. The award for replacement costs of damaged contents ($160,000) fell approximately in the middle of the amount claimed by the applicant ($184,628) and the amount claimed by the insurer ($139,399). The replacement value fixed for undamaged contents of $65,235.51 accords with the applicant’s position on this issue.

8With respect to the Applicant’s second submission, if the insurer’s appraiser did challenge the evidence of his own consultant he was entitled to do so. As already noted, the process contemplates that appraisers are to arrive at decisions based on their own knowledge and expertise.

9The third argument about private meetings ignores the fact that it was the Applicant who demanded that the appraiser appointed by the insurer not be in the same room as she was and that he be somewhere where she could not hear him. Given that this was a process that the applicant demanded, it cannot be used to found a complaint of reasonable apprehension of bias.

[10]

Conclusion

For these reasons the application is dismissed.

[11]

Costs

“For reasons given orally by Sachs J. this application is dismissed. As per the agreement of the parties the Respondent is entitled to its costs of this application fixed in the amount of $12,500 all inclusive.”

Sachs J.

I agree _______________________________

Horkins J.

I agree _______________________________

Thorburn J.