ONTARIO INSURANCE COMMISSION
Neutral Citation: 1993 ONICDRG 14
File No. A-002166
BETWEEN:
NIKOLAOS MOURIOPOULOS
Applicant
and
THE CITADEL GENERAL ASSURANCE COMPANY
Insurer
DECISION ON PRELIMINARY MOTION
Issues:
The Applicant, Nikolaos Mouriopoulos, was injured in a motor vehicle accident on November 18, 1990. He received accident benefits from the Insurer payable under the No-Fault Benefits Schedule, Regulation R.R.O. 672, enacted under the Insurance Act, R.S.O. 1990, c. I.8. These benefits were ultimately terminated by the Insurer.
The Applicant disputed the Insurer's termination of benefits, and applied to the Ontario Insurance Commission for mediation of the dispute. Subsequently, the mediator issued a Report of Mediator, which stated that the dispute over the Applicant's entitlement to benefits had been settled. It is the Applicant's position that the issue was not settled in mediation. The Applicant applied for arbitration of the same issue. The Insurer raised a preliminary objection to the right of the Applicant to refer this matter to arbitration under section 281(2) of the Insurance Act, on the grounds that there was a binding settlement of the dispute. The question in this preliminary hearing is whether there was a such a binding settlement.
Result:
The Applicant is entitled to refer the matter of his entitlement to no-fault benefits arising from an automobile accident on November 18, 1990 to arbitration under section 281(1) of the Insurance Act.
The Applicant is entitled to his expenses incurred in respect of the arbitration under section 282(11) of the Insurance Act.
Hearing:
A preliminary motion was heard in Hamilton, Ontario, on March 18, 1993, before me, Susan Naylor, Senior Arbitrator.
Present at the hearing:
Applicant:
Nikolaos Mouriopoulos
Applicant's Representative:
J. David Helson Barrister and Solicitor
Alexander Mouriopoulos (Applicant's son and agent)
Insurer's Representative:
James Flaherty Barrister & Solicitor
John Craig Assistant Vice-President, Claims Dept. The Citadel General Assurance Company
Richard Dubin, Manager The Citadel General Assurance Company
Nikolaos Mouriopoulos, Alexander Mouriopoulos, and John Craig testified at the hearing.
Exhibits:
The following documents were marked as Exhibits to the hearing:
Exhibit 1
Report of Mediator, dated August 12, 1992
Exhibit 2
Memorandum to file from John Craig, dated February 8, 1993
Exhibit 3
Claim Activity Log, The Citadel (one page)
Exhibit 4
Confirmation of Settlement form, dated August 17, 1992
Exhibit 5
Telephone message, dated August 17, 1992
Exhibit 6
Letter from Alexander Mouriopoulos, dated August 18, 1992
Exhibit 7
Application for appointment of a mediator dated May 19, 1992
Exhibit 8
Letter from John Craig, The Citadel, dated August 17, 1992
Findings:
Section 279 of the Insurance Act requires that disputes over no-fault benefits must be resolved in accordance with a process set out in the legislation. To facilitate settlement, disputes first must be submitted to mediation, conducted through the offices of the Ontario Insurance Commission. A mediator is appointed to look into the dispute and try to settle it. If the dispute is not resolved within the time frame set out in the legislation, the mediator is statutorily required to prepare a report setting out the remaining unresolved issues. It is the practice of the Ontario Insurance Commission to also issue a report when issues have been settled. In both cases, the report is known as the Report of Mediator. In the case of settlement, it is customary for the mediator to also send to each party a standard Confirmation of Settlement form, for execution by the party.
The parties are precluded from litigating or arbitrating disputes until mediation has been completed. Section 281(2) of the Insurance Act states:
No person may bring a proceeding in any court or refer a matter to arbitration unless mediation has first been sought and has failed.
The Applicant in this case applied for mediation of his dispute over ongoing benefits as he was required to do. His application for appointment of a mediator, filed on June 15, 1992, is Exhibit 7. Mr. Sydney Steinman was appointed mediator. The mediation was conducted by a series of telephone calls between the mediator and each of the parties separately.
The Applicant's son, Alexander Mouriopoulos, who is a lawyer, acted as his father's agent during the mediation. The Applicant had no direct dealings with the mediator. John Craig, Vice President, Claims Department, acted on behalf of the Insurer in the mediation. In turn, he relayed the substance of his communications with the mediator to the agent handling the file, V. Monge, Claims Examiner. During the mediation, Alexander Mouriopoulos did not communicate with Mr. Craig, except through the mediator.
The Report of Mediator filed as Exhibit 1 states that the mediation process took place between June 16, 1992 and August 12, 1992. The evidence--the testimony of Alexander Mouriopoulos confirmed by the notations in the Insurer's claim activity log, filed at Exhibit 3--indicates that, at the end of July, the mediator scheduled a face-to-face mediation meeting with the parties. The meeting was arranged for August 19, 1992 (the log also indicates a possible alternative date of August 25, 1992) and was to take place in the event that the mediator was unable to settle the case by telephone beforehand.
Both Alexander Mouriopoulos and John Craig testified to having telephone discussions with the mediator about settlement at some point on or before August 12, 1992 (the date of the Report of Mediator), although they testified as to quite different dates.
Subsequently, a Report of Mediator dated August 12, 1992 was issued by Mr. Steinman. It stated that the parties had settled the issue of the Applicant's entitlement to benefits on the following terms:
The insurer will pay to the insured four more weeks of benefits to cover the period of April 17, 1992 until May 20, 1992 for a total of $740.00 calculated at $185.00 per week, inclusive of interest in final settlement of this mediation.
John Craig received a copy of the Report of Mediator, together with a standard Confirmation of Settlement form. These are marked as Exhibits 1 and 4, respectively. John Craig completed the Confirmation of Settlement form on behalf of the Insurer and returned the signed form, dated August 17, 1992, to the Commission. His covering letter of the same date is marked Exhibit 8. Alexander Mouriopoulos testified that he had not agreed to any firm settlement in his discussions with the mediator, and had not consented to the terms stipulated in the report. He testified that he did not receive a copy of the Report of Mediator or the Confirmation of Settlement form. The Applicant, Nikolaos Mouriopoulos, testified that he received these documents, but only in September, after the events in issue had ended. The Applicant never signed or returned the Confirmation of Settlement form.
Alexander Mouriopoulos testified that he learned of the settlement after receiving a telephone message stated to be from the mediator, dated August 17, 1992. The telephone message is filed as Exhibit 5. Mr. Mouriopoulos testified that he immediately telephoned the mediator's office, and ultimately spoke to him by telephone the next day on August 18, 1992. He testified that he told the mediator that he had not agreed to the settlement, and asked that the mediation meeting proceed as planned. Following the conversation, he wrote a letter to the mediator dated August 18, 1992, filed as Exhibit 6. The letter states:
Further to the above-noted matter and our earlier conversation of today's date, please be advised that the appointment set for Wednesday, August 26, 1992, at 10:00 a.m., is not convenient for myself and the insured to attend, and respectfully request that the appointment be moved to the alternate date as suggested by you of Thursday, August 27, 1992 at 10:00 am.
The letter did not refer to the purported settlement.
Alexander Mouriopoulos testified that the face-to-face mediation meeting did take place on August 27, 1992 as arranged, in respect of the issue of the Applicant's entitlement to benefits. The meeting did not resolve the differences between the parties, and the Applicant subsequently filed for arbitration.
The sole question before me is whether the parties had reached an oral settlement in respect to the Applicant's claim to benefits as reflected in the Report of Mediator dated August 12, 1992. A binding settlement is effected only when the parties are in accord with respect to the terms of an agreement. The intent of the parties as to existence of any such agreement must be determined objectively, having regard to all relevant circumstances relating to the alleged settlement.
I heard testimony from the parties as to details of their separate telephone discussions with the mediator. The mediator was not called to testify. Under section 11(3) of the Insurance Act, the consent of the Commissioner of the Ontario Insurance Commission is required in order for the mediator to testify. In this case, there was no evidence that the consent of the Commissioner had been requested.
In Leon Albert Bailey and CAA Insurance Company (Ontario), O.I.C. File No. A-001139, issued on October 29, 1992, Arbitrator Mackintosh ruled that evidence of communications between the parties and the mediator was privileged and was inadmissible in an arbitration hearing held to determine the existence of an alleged settlement. She further ruled that the parties alone could not waive such privilege; it also required the consent of the third party mediator.
In his submissions, counsel for the Insurer argued that Bailey should be followed. He submitted that the best evidence of what occurred was the contemporaneous Report of Mediator, filed at Exhibit 1. Counsel for the Applicant submitted that no privilege was attached to communications in mediation. He submitted that section 3.3 of the Practice Code simply reiterated the long-standing principle that communications made with a view to settlement were protected from disclosure as irrelevant in subsequent proceedings.
In my view, nothing in this case turns on the admissibility of the communications between the parties and the mediator. In the absence of the testimony of the mediator, the testimony of the parties as to their separate telephone discussions with the mediator is in the general nature of hearsay and is essentially unverifiable. Little weight should be accorded to this evidence, in the event such evidence is admitted.
I accept that the Report of Mediator is not conclusive of the existence of a settlement at mediation, and, as stated in Bailey, represents "no more or less than the recorded 'opinion' of the mediator". It should be accorded the weight attributable to a record prepared contemporaneously by a neutral third party, in the ordinary course of business.
In this case, the best objective indication of the existence, or otherwise, of an agreement is reflected in the actions of the parties immediately following the alleged event in issue. This evidence was unchallenged. On learning of the purported settlement, Mr. Mouriopoulos immediately contacted the mediator to set the record straight and request a continuation of the mediation in respect of the outstanding dispute. The face-to-face mediation meeting that had been previously scheduled went ahead as planned. The Applicant did not complete the Confirmation of Settlement form. The Insurer did not forward any settlement payment. These factors persuade me that the parties were never "ad idem", or in accord, in respect to the purported settlement.
In my view, the absence of agreement in this case appears to be the result of nothing more than a misunderstanding. Inevitably, in the course of the process - as in any process - misunderstandings may occur as to the intent of the parties. In this case, the Applicant took immediate steps to clarify the misunderstanding.
I conclude that the parties did not reach agreement through mediation in respect to the issues in dispute in this arbitration, as recorded in the report of Mediator dated August 12, 1992, filed as Exhibit 1. Consequently, mediation failed and the Applicant is entitled to refer the matter to arbitration under the terms of section 281(1) of the Insurance Act.
The Applicant is entitled to his expenses incurred in respect to this arbitration pursuant to section 282(11) of the Insurance Act, and Ontario Revised Regulations 664.
Order:
The Applicant is entitled to refer the matter of his entitlement to no-fault benefits arising from an automobile occurring on November 18, 1990 to arbitration under section 281(1) of the Insurance Act.
The Applicant is entitled to his expenses incurred in respect to the arbitration under section 282(11) of the Insurance Act.
March 23, 1993
Susan Naylor Senior Arbitrator
Date