Neutral Citation: 1994 ONICDRG 95
File Nos. P-001897 & P-001898
OFFICE OF THE DIRECTOR OF ARBITRATIONS
BETWEEN:
ASHLEY AND ALISSA CHAPMAN
Applicants (Respondents)
and
ALLSTATE INSURANCE COMPANY OF CANADA
Insurer (Respondent)
and
WELLINGTON INSURANCE COMPANY
Insurer (Appellant)
Before:
Elisabeth Sachs Director of Arbitrations
Counsel:
E. Kent (for Appellant, Wellington Insurance Company)
J.M. Chadwick (for Respondent, Allstate Insurance Company of Canada)
Appearance:
F. Armel (for Respondents; Applicants)
ORDER
I. NATURE OF PROCEEDINGS
The appellant, Wellington Insurance Company ("Wellington") initially appealed a preliminary order of Frederika Rotter, Senior Arbitrator, made February 4, 1994 (reasons for decision released April 22, 1994) determining that it, and not Allstate Insurance Company of Canada ("Allstate") is responsible for payment of statutory accident benefits to which Ashley and Alissa Chapman ("the Chapmans") might be entitled.
In their Response to Appeal, the Chapmans asked for an interim order directing Wellington to pay care benefits pending resolution of their claims, these having previously been paid by Allstate. Allstate, in its Response to Appeal, sought an interim order directing Wellington to repay to it all statutory accident benefits paid to the Chapmans, with interest. Both parties relied on s.279.4.1 of the Insurance Act R.S.O. 1990, c.I-8 (the "Act").
The parties were advised by letter dated April 15, 1994, that no interim orders would issue, for reasons not material to this decision. Oral submissions were scheduled, ultimately to be heard on September 21, 1994.
On September 15, 1994, less than a week before the date for submissions, Wellington purported to withdraw its appeal by delivery of a facsimile letter to that effect to the Commission and counsel for the Chapmans and Allstate. Allstate objected to the unilateral withdrawal of the appeal, noting it would request a formal dismissal of the action and an order for repayment of benefits paid and costs. The Chapmans took no position on the issues between Wellington and Allstate and advised the request to withdraw would not be opposed.
II. ISSUE & ANALYSIS
The issue is whether an appellant may withdraw an appeal, thereby putting an end to the matter before the Director, including claims of other parties raised in the appeal proceeding apart from a cross-appeal or intervention application.
Wellington, in its submissions, stated it accepts the arbitrator's order and admits its liability to pay statutory accident benefits to the Chapmans, if the latter are found to be entitled to receive them.
Which insurer might be liable to pay accident benefits is an issue quite separate from whether a claimant is entitled to them, and in what amount. A twist in this case is that the Chapmans withdrew their Application for Arbitration shortly after the preliminary order was released. A court action is now under way, with discoveries scheduled, on the issues initially raised in arbitration and others. Wellington and Allstate are named as defendants in the court action.
The first question is whether the Director is required by the Act to take any positive steps once an appeal is filed to determine it in some manner. It is common ground the Act, any relevant regulation and the Dispute Resolution Practice Code (the "Code") do not explicitly provide for the withdrawal of a Notice of Appeal. The next question is whether any implicit direction makes the disposition of an appeal by order or decision mandatory.
The language used in statutes can be mandatory (or directory) or discretionary. Usually, the use of the word "shall" imports a mandatory meaning whereas the word "may" is discretionary. Section 283 and following of the Act, outlining the Director's jurisdiction, use discretionary language. With the exception of s.283(2), setting out the requirements of a written appeal, the sections guiding the Director on extension of time to request an appeal, how applications are determined and the options available to deal with appeals, variations and revocations are all couched in discretionary language. The ability to intervene in an appeal is also at the Director's discretion.
Aside from those involving the Director's duty as part of a statutory Commission, few sections of the Act are directory. These are:
determining issues by order (s.279(4));
appointing arbitrators to hold hearings (282(2));
referring questions to the Medical and Rehabilitation Advisory Panel (s.282(5));
filing copies of orders in court at the insured person's request (s.282(14); 283(9)); and
the obligation to review arbitration orders and appeals for disclosure of any unfair or deceptive business practices (s.288).
Of those, only s.279(4) applies in this case. An issue was submitted for determination by way of appeal. However, that issue is no longer in dispute. Wellington has, as the party bringing the appeal, now conceded the order appealed from. Nothing is left for the Director to determine on that order. What follows from the withdrawal, however, is not necessarily a dismissal of the appeal and an inability to deal with claims raised by the other parties to it.
Allstate and the Chapmans are affected by the actions of Wellington. They each have requested orders they claim are a direct consequence of the arbitral order, notwithstanding the appeal.
The Director is also affected by Wellington's action. In any appeal, consideration may be given to inviting or accepting intervention requests, or stating the case for the opinion of the Divisional Court on an issue of law. Once the hearing or adjudicative process has been initiated, these other options of the Director take the case out of the singular control of the appellant and give the Director, as a statutory tribunal, powers and interests beyond those of the immediate parties.
A withdrawal is not within the sole purview of an appellant. It must be considered, and allowed or not, by the Director. Each case is to be dealt with in accordance with the principles of natural justice, and a duty of fairness is owed to all parties.
A succinct statement of the principles applicable to statutory tribunals is found in a decision of the Environmental Appeal Board, Re Uniroyal Chemical Ltd. (1992), 9 C.E.L.R. (N.S.) 151 at pg. 162:
“1. Where a regulatory regime is intended to protect the broad public interest, courts and boards are concerned about any act of the initiator of proceedings that puts an end to the proceedings without taking into account the public interest (Ackers v. Lyons (1981), 1981 CanLII 1744 (ON HCJ), 32 O.R. (2d) 633 (Co. Ct.)).
Courts and tribunals are concerned about the possibility that a unilateral withdrawal or settlement of proceedings by a party initiating the process may prejudice other parties or potential parties to the proceedings (Carfrae Estates Ltd. v. Stavert (1976), 1976 CanLII 731 (ON HCJ), 13 O.R. (2d) 537 (Div. Ct.); Ackers v. Lyons; Re Oxford Holbrook Waste Disposal Site Expansion (1983), 15 O.M.B.R. 68 (Environmental Assessment Bd.); see also Carrier-Sekani Tribal Council v. Canada (Minister of the Environment) (1991), 6 C.E.L.R. (N.S.) 265, 5 Admin. L.R. (2d) 1, 44 F.T.R. 273 (T.D.)).
A tribunal's power to refuse to allow a unilateral withdrawal of an appeal or other proceedings does not depend on an express authority to do so. Such a power may be found in a board's inherent power to control its own process or in a contextual approach to interpretation of the tribunal's powers; that is, it is necessary to look at the entire statute, consider its objectives, and consider the surrounding provisions as well as the provision under discussion (Edgeley Farms Ltd. v. Uniyork Investments Ltd., 1970 CanLII 327 (ON CA), [1970] 3 O.R. 131, 12 D.L.R. (3d) 459 (C.A.); Carfrae Estates, at p.545; Godrey v. Ontario (Police Commission) (1991), 1991 CanLII 7115 (ON CTGD), 83 D.L.R. (4th) 501, 5 O.R. (3d) 163, 7 Admin. L.R. (2d) 9, 53 O.A.C. 338 (Div. Ct.))."
The Commission tribunals have an inherent power to control their own processes, and as such, are not bound to accept a withdrawal as putting an end to a case without further orders or consequences.
In this case, the interim orders asked for by Allstate (repayment of benefits paid) and the Chapmans (continuation of benefit payments) require an initial determination of whether the Chapmans are entitled to the statutory accident benefits applied for. The Chapmans admit this issue is now squarely before the court. In any event, no arbitral determination has been made, and another forum has been chosen to decide the matter.
I find there is no basis upon which to make the interim orders requested. No doubt Allstate's claims for repayment will be made to the court seized of the action, either from the Chapmans or Wellington. In the limited circumstances of this case, there is no prejudice to Allstate or the Chapmans in permitting Wellington to withdraw its appeal.
Allstate also requested an order of the Director so it could be filed in court. Nothing prevents Allstate from filing the arbitral order pursuant to the Statutory Powers Procedures Act, R.S.O. 1990, c.S.22. Allstate does not need a further order of the Director disposing of the appeal.
III. EXPENSES & ASSESSMENT FEE
Allstate requested its expenses of this proceeding, stating it had fully prepared for the submissions in appeal and, on extremely short notice, its argument on the withdrawal request. Furthermore it says it cannot receive any redress in the court action. Allstate argues the Director has a residual power by s.32 of the Code to make an order in favour of an insurer in a situation such as this one.
Allstate also asks for a return of the assessment fee it paid pursuant to the Regulation as an insurer-party to an appeal.
The Chapmans are not making an expense request.
I do not agree the Director has a residual discretion to grant an insurer expenses through the mechanism of the Code. Its provisions cannot exceed the jurisdiction afforded by the Act, and Regulations. The Director may only award expenses to an insurer by s.283(7) of the Act which gives the Director, like arbitrators, the power to award expenses to an insurer payable by an insured person, in specific instances. That section and the Code cannot, in my view, be read to extend the ability to award expenses to one insurer from another as claimed. The Regulation governing payment of assessment fees similarly does not contemplate a return of a fee, properly paid on commencement of an action, to what may be a "innocent" insurer party.
Clearly Allstate is aggrieved. Having been the successful insurer in arbitration, forced to participate in an appeal proceeding and pay the appeal assessment through no deliberate act of its own, it now finds itself unable to recover the expenses it necessarily incurred as a respondent who has been ultimately successful, given the admission of liability by Wellington. The Director does not, however, have any inherent power to go beyond the express provisions of the legislation.
IV. ORDER
Wellington may withdraw its Notice of Appeal.
I make no order as to expenses.
October 6, 1994
Elisabeth Sachs
Director of Arbitrations
Date