Neutral Citation: 1995 ONICDRG 103
File No. A-009381
ONTARIO INSURANCE COMMISSION
BETWEEN:
KONSTANTY ZIGGY WOLMAN
Applicant
and
ZURICH INSURANCE COMPANY
Insurer
DECISION ON PRELIMINARY ISSUES
Issues:
The Applicant, Konstanty Ziggy Wolman, claimed ongoing entitlement to statutory accident benefits payable under Ontario Regulation 6721, as a result of a motor vehicle accident on February 17, 1993. The Insurer alleged that on November 19, 1993, Mr. Wolman settled all of his claims for statutory accident benefits. The Insurer also alleged that Mr. Wolman failed to attend for medical examinations it had arranged. The Insurer contended that Mr. Wolman could not proceed to arbitration for both reasons. The Insurer requested a hearing to determine these issues.
The preliminary issues are:
Did Mr. Wolman settle his claims for statutory accident benefits arising from the motor vehicle accident of February 17, 1993 with Zurich Insurance Company?
Did Mr. Wolman fail to attend a medical examination arranged by the Insurer pursuant to section 23(2) of the Schedule? If so, what are the consequences which flow from such a refusal?
Is the Applicant entitled to his expenses in respect of the arbitration under section 282(11) of the Insurance Act, R.S.O. 1990, c.I.8, as amended?
Is the Insurer entitled to an award to be paid by Mr. Wolman, to the Insurer under section 282 (11.2) of the Insurance Act?
Result:
Mr. Wolman settled his claims for all statutory accident benefits arising from the motor vehicle accident of February 17, 1993 with Zurich Insurance Company on November 19, 1993 and cannot proceed to arbitration.
Mr. Wolman is not entitled to his expenses in respect of the arbitration.
The Insurer is entitled to an award in the amount of $2,000 to be paid by Mr. Wolman.
Present at the Hearing:
Applicant:
Konstanty Ziggy Wolman on February 1, 1995 and for a portion of February 15, 1995
Applicant's Representative:
Ken Griffin, agent, on February 1, 1995 and for a portion of February 15, 1995
Insurer's Representative:
Gregory Heckel Barrister and Solicitor
Witnesses:
Ms. A. Antoine
Exhibits and other documents before the arbitrator are detailed in Appendix A.
The proceedings were transcribed by Eddie Dugas, Farr & Associates Reporting Inc.
Hearing:
History of proceedings:
The hearing on preliminary issues, originally scheduled for January 12, 1995, was adjourned by the Office of the Registrar at 8:30 a.m. that morning. Mr. Wolman requested the adjournment that morning on the basis that he was ill.
The hearing on preliminary issues was held in North York, Ontario, before me, Suesan Alves, arbitrator on February 1, and 15, 1995. On February 1, 1995, one witness, Ms. Audrey Antoine, testified and was cross-examined. Mr. Wolman requested a further adjournment, stating that he was not sufficiently well to continue with the hearing. The adjournment was granted and the hearing was adjourned to February 15, 1995.
The parties agreed that further evidence would be adduced by way of Affidavits, which would be exchanged by February 9, 1995. The parties also agreed to advise each other whether they intended to cross-examine the deponents. Any cross-examinations would take place before me on the February 15, 1995 date.
Affidavits of Pierre Gravesande and of James Herbrand, both sworn February 9, 1995, were filed as exhibits on behalf of the Insurer. A Statement of Service signed February 15, 1995, and filed on February 16, 1995, following the hearing, indicates that these Affidavits were transmitted by facsimile to Mr. Griffin and to Mr. Wolman on February 13, 1995 at 9:30 a.m. The Statement of Service indicates that these documents were also sent by regular mail to Mr. Griffin and Mr. Wolman on that date. No cross-examination of Mr. Herbrand or of Mr. Gravesande took place before me on February 15, 1995.
On February 15, 1995, Mr. Wolman and Mr. Griffin arrived late, after the hearing had re-commenced. No affidavit material was received on behalf of Mr. Wolman. Mr. Wolman and Mr. Griffin left before the hearing was concluded. In the absence of Mr. Wolman and of Mr. Griffin, I caused the statutory declarations of Mr. Wolman and of Mr. Griffin, both declared on December 3, 1993, to be filed as exhibits in this hearing. These documents had been provided to the Insurer in about December 1993, and had been filed with the Registrar's office by Mr. Wolman prior to the pre-hearing. Counsel for the Insurer was not opposed to the entry of these documents as exhibits.
I advised the parties of my decision on the preliminary issues by letter dated March 2, 1995, with reasons to follow. The following are my reasons.
Evidence and Findings
1. Was there a settlement?
Background:
Zurich Insurance Company paid Mr. Wolman weekly income benefits at the rate of $600 per week between February 24, 1993 and October 13, 1993. The Insurer "suspended" Mr. Wolman's weekly income benefits as of October 13, 1993. Mr. Wolman and his agent, Mr. Griffin, made several attempts to have these benefits reinstated. The Insurer offered to settle the claim in exchange for a full and final release.
On November 19, 1993, Mr. Griffin, Mr. Wolman's agent handed a release to the Insurer's claims supervisor. The Insurer gave Mr. Griffin a cheque, payable to Mr. Wolman, in the amount of $20,000. The Insurer relies upon the release. The Insurer contends that Mr. Wolman relinquished his rights to further statutory accident benefits in relation to a motor vehicle accident on February 17, 1993, in exchange for $20,000. Mr. Wolman contends that he did not sign the release relied upon by the Insurer, and, in the alternative, that he signed the release under duress and protest.
Insurer's evidence:
Mr. James Herbrand, a claims manager employed by the Insurer, deposed that on November 19, 1993, Mr. Griffin, Mr. Wolman's agent telephone him and informed him that Mr. Wolman was prepared to accept the sum of $20,000. Although there was no specific discussion of a full and final release in that telephone call, Mr. Herbrand stated that in the context of their previous discussions, he understood that the monies were to be paid in exchange for a full and final release. Mr. Herbrand deposed that he requisitioned a cheque in the amount of $20,000 payable to Mr. Wolman. Mr. Herbrand stated that he instructed the claims supervisor, Ms. Antoine, to complete the settlement by obtaining a full and final release in exchange for the cheque, if he was out of the office when Mr. Wolman arrived at Zurich's premises.
Ms. Antoine testified that Mr. Wolman arrived while Mr. Herbrand was out of the office. She and the claims adjuster met with Mr. Wolman. Ms. Antoine anticipated a brief meeting for the execution of the release and the exchange of funds. Ms. Antoine testified that instead, the meeting with Mr. Wolman lasted for about an hour, and involved much discussion of the claim. Mr. Wolman wanted more than $20,000. He wanted to add expenses and additional weeks of benefits.
The release was presented to Mr. Wolman during the meeting. Ms. Antoine testified that Mr. Wolman stated that he did not understand the release, and that he would only sign it if he could add the words "under protest and duress". Ms. Antoine testified that she told Mr. Wolman that he did not have to sign the release.
Ms. Antoine testified that Mr. Wolman demanded the release form, and that she initially refused to give it to him. Mr. Wolman then became very agitated, "resorted to his usual name calling", and tried to grab the release. Ms. Antoine testified that Mr. Wolman then used his cellular phone to telephone 911 and summonsed the police to the Insurer's reception area. Ms. Antoine testified that she obtained legal advice from counsel and then gave Mr. Wolman the release form. Ms. Antoine testified that Mr. Wolman signed a release, while the police were present, adding "under protest and duress". Mr. Wolman left the Insurer's offices with a release but without the cheque.
Ms. Antoine testified that within 15 minutes of Mr. Wolman's departure, Mr. Griffin, Mr. Wolman's agent, attended at the Insurer's offices. Ms. Antoine testified that Mr. Griffin informed her that he had succeeded in calming Mr. Wolman, that Mr. Wolman was waiting downstairs in the lobby, and that he was now prepared to sign the release.
Ms. Antoine testified that she read over a fresh release to Mr. Griffin. She discussed with him that in exchange for the $20,000 there would be no more claims in connection with the February 17, 1993 accident. She pointed out that Mr. Wolman's signature would need to be witnessed. Ms. Antoine testified that Mr. Griffin stated to her that he understood and that he would deal with Mr. Wolman. Mr. Griffin then took the release and left the Insurer's offices.
Ms. Antoine testified that Mr. Griffin returned to the Insurer's offices that day with the release, signed by Mr. Wolman and witnessed by Mr. Griffin. Ms. Antoine gave Mr. Griffin a cheque dated November 19, 1993, in the amount of $20,000, payable to Mr. Wolman. It appears that the cheque was cashed on November 19, 1993. Ms. Antoine testified that the funds have never been returned to Zurich Insurance Company.
On December 3, 1993, Mr. Wolman began to demand further monies from Zurich Insurance Company. His efforts to obtain further compensation included correspondence, meeting with the company president, retaining a lawyer, swearing a statutory declaration, filing for mediation and commencing this arbitration. The Insurer maintained its position that the matter had been fully and finally settled on November 19, 1993.
The Insurer relied on the evidence of Mr. Pierre Gravesande to establish that Mr. Wolman had previous experience in signing full and final releases. Mr. Gravesande's evidence was received by Affidavit. He deposed that he had ten years of experience in insurance claims and has been involved in the settlement of numerous claims for statutory accident benefits, with insured persons who are represented as well as unrepresented by counsel.
Mr. Gravesande's evidence was that he personally settled two of Mr. Wolman's claims for statutory accident benefits on January 25, 1993, in his capacity of claims manager at Dominion of Canada General Insurance Company. Both claims were settled in exchange for a full and final release. Mr. Gravesande deposed that he met with Mr. Wolman on January 25, 1993, and read over the release to Mr. Wolman, "out of an abundance of caution, as was my habit when settling claims with unrepresented insureds." According to Mr. Gravesande, Mr. Wolman "indicated to me that he understood the contents and the meaning of the Release."
I find that the release in favour of the Dominion of Canada General Insurance Company Limited dated January 25, 1993 is substantively similar to the release dated November 19, 1993, in favour of Zurich Insurance Company.
Mr. Wolman's position:
No evidence was called by Mr. Wolman at the hearing, nor were any affidavits filed on his behalf. In the absence of Mr. Wolman and of Mr. Griffin, I caused the statutory declarations, declared December 3, 1993, given to the Insurer in December 1993, and filed with the Commission prior to the pre-hearing, to be filed as exhibits at the hearing. Counsel for the Insurer did not object to the filing of this material.
In his statutory declaration, Mr. Wolman asserted two positions with respect to his signature on the release. One was that he did not sign it; his alternative position was that he signed it, but did so under protest and duress. I find that these positions are inconsistent. I accept the statement that he signed the release.
The signatures of Mr. Wolman and of Mr. Griffin on the release in favour of Zurich Insurance Company, when compared to those on the statutory declarations of Mr. Wolman and of Mr. Griffin, are quite similar. Mr. Wolman admits signing the release. In my view there is no question that the release was signed by Mr. Wolman on November 19, 1993.
In his statutory declaration, Mr. Wolman declares:
- That I was forced to sign a release under duress and not understanding it [sic] contents in order to receive disability benefits since I am still unable to work and have no other means of support. That I hereby state that this release is null and void since all the matters pertaining to my claim haven't been resolved.
In my view, the mere allegation by Mr. Wolman, that he signed the release in order to receive disability benefits, even if true, does not establish duress. There was no evidence of unlawful threats, coercion, or physical compulsion on the part of the Insurer which would support Mr. Wolman's claim that he signed the release under duress. Further, he signed the release in the presence of his agent.
Conclusion:
I accept the Insurer's uncontradicted evidence. Mr. Wolman's agent, Mr. Griffin, relied on Mr. Wolman's signature on the release on November 19, 1993, when he presented the release to the Insurer in order to obtain the cheque in the amount of $20,000.
The evidence of Mr. Gravesande establishes that some ten months earlier, Mr. Wolman understood the meaning and contents of a similar release.
When Mr. Wolman left the Insurer's premises on November 19, 1993, his efforts to obtain additional amounts of money from the Insurer had failed. He knew the terms of the settlement: to provide a full and final release for all claims for statutory accident benefits arising from the motor vehicle accident of February 17, 1993, in order to obtain the cheque for $20,000. Later that day, following discussions with his agent, Mr. Wolman chose to accept the settlement, and signed the release.
I find on the basis of the evidence of Ms. Antoine, Mr. Herbrand and Mr. Gravesande, that Mr. Wolman understood that when he signed the release in favour of Zurich Insurance Company, on November 19, 1993, he relinquished his rights to make any further claims for statutory accident benefits in relation to the motor vehicle accident which occurred on or about February 17, 1993, in exchange for the sum of $20,000. The onus of establishing the defence of duress rests with Mr. Wolman. On the evidence before me, Mr. Wolman failed to establish that he signed the release under duress. In view of my conclusion, Mr. Wolman cannot proceed to arbitration. I do not therefore need to deal with the Insurer's alternative claim.
Expenses:
Mr. Wolman seeks an award of his expenses. An arbitrator has a discretion to award these expenses pursuant to section 282(11) of the Insurance Act.
The principles guiding the exercise of that discretion are set out in the case of Ralph McCormick and Economical Mutual Insurance Company, October 2, 1991, OIC File No. A-000139, by Senior Arbitrator Naylor, and approved by the Director of Arbitrations in the case of Vito Luigi Calogero and The Co-Operators General Insurance Company, February 13, 1992, OIC File No. P-000251:
Accordingly, it is appropriate to award an applicant his or her expenses, unless, in the circumstances of the particular case, it is determined that the application for appointment of an arbitrator was manifestly frivolous or vexatious, or that the applicant's conduct unreasonably prolonged the proceedings.
I find that Mr. Wolman engaged in conduct which unreasonably prolonged the arbitration process because of the following:
Time was taken at the pre-hearing, on two occasions, to remind Mr. Wolman that this arbitration was a civil proceeding, and to request that he conduct himself accordingly. Mr. Wolman then used his cellular phone to telephone 911 to summons the police and ambulance. I adjourned the pre-hearing, and the Insurer's requests for the production of documents were concluded via correspondence. Once the police and ambulance attended at the offices of the Commission, Mr. Wolman refused their assistance. This conduct unreasonably prolonged the completion of the pre-hearing.
During the course of the hearing, Mr. Wolman made abusive comments to counsel for the Insurer and to the witness. One such episode took place towards the end of a recess. This caused a further delay. Time was spent in the course of the hearing reminding Mr. Wolman of the possible cost consequences of his conduct.
On February 15, 1995, Mr. Wolman delayed the resumption of the hearing. Mr. Wolman and Mr. Griffin arrived together, almost 40 minutes late. Counsel for the Insurer was in the course of making his submissions when Mr. Wolman arrived at the hearing. Mr. Wolman immediately became rude and disruptive of the proceedings. He shouted at a volume sufficient to disturb the conduct of an arbitration in an adjacent hearing room. He announced that he was too sick to proceed and that he intended to leave the hearing. I indicated to Mr. Wolman that the hearing would continue in his absence. He made allegations of bias. I do not accept Mr. Wolman's allegations.
I find that on February 15, 1995, Mr. Wolman was sufficiently well, that, had he wished to do so, he could have remained at and participated in the hearing. The volume and extent of his participation at the hearing led me to this conclusion. Following the conclusion of the hearing Mr. Griffin and Mr. Wolman were still at the offices of the Commission.
In view of my finding that Mr. Wolman's conduct unreasonably delayed the proceedings, I exercise my discretion to deny Mr. Wolman's claim for expenses incurred in respect of the arbitration.
The Insurer's claim for an award:
The Insurer claims an award in the amount of $2,000. An arbitrator has a discretion under section 282(11.2) of the Insurance Act to award an amount to be paid by the insured person to the insurer, that does not exceed the amount of the insurer's assessment, if an insured person commences an arbitration that, in the opinion of the arbitrator is frivolous, vexatious or an abuse of process.
Mr. Wolman commenced this arbitration after he had signed a full and final release for all of his statutory accident benefits. Mr. Wolman alleged that he signed the release under duress. This is a serious allegation. At the hearing I was advised by Mr. Griffin that he intended to testify and would call Mr. Wolman as a witness. Mr. Griffin agreed to furnish his evidence-in-chief, and that of Mr. Wolman by way of affidavit. He did not do so. Neither Mr. Griffin nor Mr. Wolman testified at the hearing. The Insurer was put to the expense of responding to an arbitration where it had a full and final release. Having regard to all of the circumstances of this case, I find that Mr. Wolman commenced a frivolous arbitration, and that he abused the process of this tribunal. In this case the amount of the Insurer's assessment was $2,000. I exercise my discretion to award an amount of $2,000 in favour of the Insurer, to be paid by Mr. Wolman.
Order:
Mr. Wolman settled his claims for all statutory accident benefits arising from the motor vehicle accident of February 17, 1993 with Zurich Insurance Company on November 19, 1993 and cannot proceed to arbitration.
Mr. Wolman is not entitled to his expenses in respect of the arbitration.
The Insurer is entitled to an award in the amount of $2,000 to be paid by Mr. Wolman.
July 27, 1995
Suesan Alves Arbitrator
Date
APPENDIX A
Exhibit 1
Letter dated January 6, 1995 from Dr. J. Lefkowitz
Exhibit 2
Letter dated December 27, 1994 from Dr. Hurdalek
Exhibit 3
Preliminary Issue Brief of Insurer
Exhibit 4
Release and Discharge dated January 25, 1993
Exhibit 5
Page one of a letter dated October 13, 1993 from Zurich Canada addressed to Dr. Zener
Exhibit 6
Letter dated January 26, 1995 from Dr. Hurdalek
Exhibit 7
Riverfront Medical Services Appointment notification dated October 14, 1993
Exhibit 8
Affidavit of Mr. Jim Herbrand, sworn February 9, 1995
Exhibit 9
Affidavit of Mr. Pierre Gravesande, sworn February 9, 1995
Exhibit 10
Statutory Declaration of Mr. Konstanty Wolman, declared December 3, 1993
Exhibit 11
Statutory Declaration of Mr. Ken Griffin, declared December 3, 1993
Exhibit 12
Letter of Dr. Hurdalek dated February 14, 1995
Other documents before the arbitrator:
Report of Mediator dated June 24, 1994
Application for Appointment of an Arbitrator dated September 30, 1994
Response by Insurer dated October 25, 1994
Pre-hearing letter dated December 23, 1994
Letter to parties dated March 2, 1995
Statement of Service of Lisa Knight signed February 15, 1995
Photocopy of Cheque in the amount of $2,000, payable to the Minister of Finance
Medical Brief of Insurer