Neutral Citation: 1995 ONICDRG 45
File No. A-008442
ONTARIO INSURANCE COMMISSION
BETWEEN:
ZORAN KOJIC
Applicant
and
GENERAL ACCIDENT ASSURANCE COMPANY OF CANADA
Insurer
DECISION
Issues:
The Applicant, Zoran Kojic, was injured in a motor vehicle accident on September 7, 1991. He claimed weekly income benefits from the Insurer, payable under section 12(2) 1 .(iii) of Ontario Regulation 6721, on the basis of an offer of employment. The Insurer did not agree that Mr. Kojic met the qualifications for a weekly income benefit under that section. Instead, the Insurer paid Mr. Kojic a weekly benefit under section 13 of the Schedule until May 22, 1992. The parties were unable to resolve their disputes through mediation and the Applicant applied for arbitration under the Insurance Act, R.S.O. 1990, c.I.8, as amended.
The issues in this hearing are:
Do the words "within one year" in section 12(2) 1.(iii) refer to the date of the accident or to the date of the offer of employment?
Was Mr. Kojic entitled to start work under the terms of the offer of employment?
The Applicant also claims interest on any outstanding benefits, and his expenses in respect of the arbitration.
Result:
The words "within one year" in section 12(2) 1 .(iii) refer to the date of the accident.
Mr. Kojic was not entitled to start work under the terms of the offer of employment.
The Applicant is entitled to his expenses in respect of this portion of the arbitration.
Hearing:
The hearing was held in North York, Ontario, on September 12, 1994 and September 23, 1994, before me, Suesan Alves, arbitrator.
Present at the Hearing:
Applicant:
Zoran Kojic
Applicant's
Paul Jewell
Representative:
Barrister and Solicitor
Insurer's
Bill Zener
Representative:
Barrister and Solicitor
Witness:
Dragan Savovski
Interpreting services were provided by Zorica Bukmanovic in Serbian and in English.
Exhibits:
Exhibit 1
Confirmation of Offer of Employment
Exhibit 2
Statement of Dragan Savovski
Background:
The parties agreed on the following facts:
Mr. Kojic had been a tool and die maker in Yugoslavia for 15 years before his arrival in Canada in June 1990 as a visitor. In July 1990, Mr. Dragan Savovski offered Mr. Kojic a job as a tool and die maker at Andy Precision Parts Co. The offer was reduced to writing by an employment officer at Employment and Immigration Canada, on July 16, 1990, on a standard form "Confirmation of Offer of Employment", based on information provided by Mr. Savovski. This document, signed by Mr. Savovski and by the employment officer was filed as Exhibit 1.
Mr. Kojic had a legitimate offer of employment, made before the accident, which was evidenced in writing. The offer was for a temporary full-time position of 12 months duration which paid $15.00 per hour to start. The offer was for Mr. Kojic to start work as soon as possible. It was a condition of the offer that Mr. Kojic obtain a work permit before he began work.
On September 7, 1991, Mr. Kojic sustained severe injuries in a motor vehicle accident. Mr. Kojic was granted a work permit by Employment and Immigration Canada on June 24, 1992. Mr. Kojic received benefits of $185 per week under section 13 of the Schedule until May 22, 1992. The parties agreed that if Mr. Kojic qualified for a section 12 benefit, Mr. Kojic would have been entitled to receive $480 per week from June 24, 1992.
In this arbitration, Mr. Kojic claimed a weekly income benefit under section 12(2)1.(iii) of the Schedule. In the alternative, he claimed a weekly benefit under section 13 beyond May 22, 1992. Counsel agreed to have the issues which relate to Mr. Kojic's entitlement to a section 12 benefit determined at this hearing. The issue of Mr. Kojic's entitlement to weekly benefits under section 13 of the Schedule after May 22, 1992, may be the subject of a further hearing.
Counsel were able to narrow many of the legal and factual issues at the pre-hearing and at the hearing. However counsel were unable to agree upon the interpretation of section 12(2) 1 .(iii), and whether Mr. Kojic qualified for a section 12 benefit.
1. Do the words "within one year" in section 12(2)1.(iii) refer to the date of the accident or to the date of the offer of employment:
The relevant portions of section 12 provide as follows:
(2) The following qualifications apply to an insured person who claims a weekly benefit under subsection (1):
- He or she must have been at the time of the accident,
i. employed or self-employed,
ii. on a temporary lay-off, or
iii. entitled to start work within one year under a legitimate offer of employment made before the accident and evidenced in writing.
- He or she as a result of and within two years of the accident must have suffered a substantial inability to perform the essential tasks of his or her occupation or employment.
(3) A person who was unemployed and who was not self-employed at the time of the accident is qualified to receive a weekly benefit under subsection (1) if he or she was employed or self-employed for any 180 days in the twelve-month period before the accident, and if he or she as a result of and within two years of the accident has suffered a substantial inability to perform the essential tasks of the occupation or employment in which he or she spent the most time during the twelve-month period before the accident.
Positions of the Parties:
Counsel for the Applicant submitted that based on the context and spirit of the legislation, the clear and unequivocal meaning of the words "entitled to start work within one year" in section 12(2) 1 .(iii) is that they refer to one year from the date of the accident. He submitted that a simple analysis is contemplated in determining whether an insured person qualifies for a weekly income benefit: was the person employed, or, alternatively, did the person have the right to work at the time of the accident?
Counsel for the Insurer submitted that the grammatical, logical, sensible and reasonable construction is that the words "entitled to start work within one year" in section 12(2)1.(iii) refer to one year from the date of the offer of employment. He further submitted that fair-minded persons could interpret the words in the section as referring to the date of the accident or to the offer of employment, however the preferred construction is that which preserves the legitimate rights of parties but which does not invite abuse. In his submission, a construction of the words as referring to the date of the offer, would better achieve this goal.
Analysis & Conclusion
The predecessor legislation, Part II of Schedule C of the Insurance Act, R.S.O. 1980, c. 218, as amended, made no provision for persons who had an offer of employment which could not be taken up because of disability resulting from a motor vehicle accident. This is a new provision in the current Schedule.
The modern principle of statutory interpretation as stated by E.A. Driedger in Construction of Statutes (2d) (Butterworths, 1983), at page 87, is that: "the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament." At page 247, Driedger states that "[g]enerally speaking" regulations "are to be construed according to the same principles as those applicable to the construction of statutes." This approach was approved by the Director of Arbitrations in the case of Michael Morin and the Personal Insurance Company of Canada, February 26, 1993, OIC File No. P-000468, and it is the approach I intend to take in construing the provisions of section 12(2) 1 .(iii).
In my view, the words of the subsection could bear either construction suggested by the parties, if looked at in isolation. However, when examined in the context of the objects of the legislation, the scheme of the Schedule, and of section 12, I conclude that the words "within one year" in section 12(2) 1.(iii)) refer to the date of the accident. My reasons are as follows:
The objects of the legislation:
In the case of Stephen Salmon and Toronto Transit Commission (Markel Insurance Company of Canada), December 20, 1991, OIC File No. A-000235, Senior Arbitrator Rotter concluded that there were two objects of the legislation (Part VI of the Insurance Act and of the Schedule). Firstly, to restrict the right to sue for personal injuries sustained as a result of the operation of a motor vehicle, and, secondly, to provide benefits to insured persons, regardless of fault subject to the terms, conditions, provisions, exclusions and limits set out in the Schedule. I agree with these conclusions.
The scheme of section 12:
Section 12 of the Schedule provides a weekly income benefit for persons who are employed at the date of the accident and for persons who are to be treated as if they were employed, who are unable to work as a result of their injuries, and who meet certain other qualifications. The amount of the benefit is calculated with reference to their lost earnings, subject to a statutory minimum of $185.60.
Initially, the qualification scheme in section 12 addresses those persons who, at the time of the accident, have an actual connection with the work force, either through employment or self-employment. These persons qualify under section 12(2) Those persons who at the time of the accident are employed, but are temporarily laid off, qualify under section 12(2)1.(ii).
Section 12 then goes on, in sections 12(2) 1 .(iii) and 12(3), to address those persons who, at the time of the accident, can claim a connection with the work force which is different from their actual connection with the work force as of the date of the accident. These persons are treated as employed persons for purposes of the Schedule.
Under section 12(3), persons who at the date of the accident were unemployed, but who in the 12 months before the accident worked 180 days, may nevertheless qualify for a weekly income benefit. The timeframe is enlarged for unemployed persons, to 12 months before the motor vehicle accident.
In my view, in light of the restriction of the right to sue in tort, the framers of the Schedule intended to extend the ability to claim a weekly income-related benefit to persons who lose their ability to earn income as a result of injuries sustained in a motor vehicle accident. The Schedule treats persons who had a legitimate offer of employment made before the accident, as employed persons, from the time the contract would have commenced. Some of these persons will be unemployed at the date of the accident; in other cases the persons will be employed, and entitled, as of the date on which the contract of employment would have commenced, to receive what will usually be an increased weekly income benefit under section 12(7)2.(ii).
I find that the framers of the Schedule intended to treat similarly, all persons who, at the time of the accident, claim a weekly benefit based on a connection with the work force which differs from their actual connection with the work force on the date of the accident.
The timeframe for unemployed persons who make a claim based on employment in the 180 days in the 12 months before the accident is extended one year backwards from the date of the accident. In my view the framers of the legislation intended to provide a similar period of time, i.e. 12 months, for persons whose claim is based on a legitimate offer of employment. In both situations the reference point contemplated by the framers of the legislation is the same in my view, i.e. from the date of the accident. I conclude that the framers of the legislation intended to enlarge the timeframe one year forward from the date of the accident for persons with a legitimate offer of employment, and one year backward from the date of the accident, for persons whose claim was based on employment in 180 days in the 12 months before the accident.
I have concluded that the Legislature intended the words to refer to one year from the date of the accident, therefore I must determine whether at the time of the accident, Mr. Kojic was entitled to start work, by virtue of a legitimate offer of employment, at any time up to September 7, 1992, being 12 months from the date of the accident.
2. At the time of the accident, was Mr. Kojic entitled to start work within one year under the offer of employment?
Positions of the Parties:
Counsel for the Applicant submitted that the job offer had never been revoked and was enforceable by Mr. Kojic. He submitted that prior to the accident, Mr. Kojic had done everything in his power to obtain the requisite work permit, that the permit was obtained within the one year qualifying period and that Mr. Kojic was entitled to benefits based on the job offer. Counsel for the Insurer submitted that the offer, on its terms, expired through the passage of time. Counsel for the Insurer further submitted that entitlement is to be determined at the date of the accident; that at the time of the accident, Mr. Kojic had no work permit and, therefore could not be said to have been entitled to start work within the meaning of section 12 of the Schedule.
Evidence:
The agreed upon facts have already been outlined under "Background", above. In addition, the prospective employer, Mr. Dragan Savovski, testified at the hearing. Mr. Savovski testified that in the summer of 1990 he had one full-time and one part-time employee who worked with him as tool and die makers at Andy Precision Parts Co. He stated that he learned of Mr. Kojic's presence in Canada in the summer of 1990, through "a third party". He telephoned Mr. Kojic and arranged for him to attend for an interview. On July 15, 1990, Mr. Savovski interviewed Mr. Kojic and offered him the job as a tool and die maker starting at $15.00 per hour.
Mr. Kojic did not have a work permit. Mr. Savovski was most definite in his evidence that he required Mr. Kojic to obtain a work permit before commencing work. Mr. Savovski and Mr. Kojic went to Employment and Immigration Canada to apply for a work permit. Mr. Savovski stated that on July 16, 1990, after completing the application for the work permit, he said to Mr. Kojic that he would receive a work permit, although Mr. Savovski stated he did not know when. He stated that he also told Mr. Kojic that he should come and start work whenever he received the permit.
Mr. Savovski was asked to comment on how long the offer was open. He responded that he was "hoping he [Mr. Kojic] would get the permit; I was hoping to have Zoran start quite soon" after July 16, 1990.
Mr. Savovski testified that "a considerable" period of time then elapsed, during which he heard nothing from Mr. Kojic. Mr. Savovski estimated this period as "six months, surely". Mr. Savovski then telephoned Mr. Kojic and was informed by Mr. Kojic that he had not received a work permit. After "some time," Mr. Savovski stated, he again telephoned Mr. Kojic, only to learn that Mr. Kojic still had not received the work permit.
Mr. Savovski stated that he next heard from Mr. Kojic via a telephone call in which Mr. Kojic informed him that he had been in a very serious accident, had been in hospital for a few months and that he was unable to walk. He stated that he learned of Mr. Kojic's work permit at the time that he learned that Mr. Kojic was badly hurt.
Mr. Savovski stated that he began making serious efforts to hire another tool and die maker as he needed a "worker to get out production and so that business will go on as it should".
In his oral evidence, Mr. Savovski gave two different timeframes during which he began making serious efforts to recruit another employee. He stated that he could not remember or be more precise about the date. At one point Mr. Savovski stated that at the time that he made the second telephone call to Mr. Kojic, "I had no time to wait. I cannot wait for Zoran. I cannot wait for anybody. I have to produce to make my customers satisfied. I waited for him for an indefinite period of time." At another point in his evidence, he spontaneously stated "I have just remembered since Zoran told me he was hurt in the motor car accident, I had to make inquiries for somebody to work for me seriously, and I had to give him $1.00 more than in his previous employment".
Mr. Savovski estimated that as many as 50 employees passed through his plant between the date on which he began his search for another worker and the date on which he gave evidence. Some had been hired on a part-time basis, depending on the orders which had been placed with his company and his production requirements. Several of the workers proved to be unsatisfactory. At the date of the hearing he had three full-time employees in addition to himself working as tool and die makers. He stated that he would not have let one of his present employees go in order to hire Mr. Kojic.
I conclude that one timeframe would place Mr. Savovski's efforts to hire someone other than Mr. Kojic at some time after January 1991, -- six months after the offer of employment, and before the accident on September 7, 1991; the other timeframe would be after the accident and after Mr. Kojic obtained his work permit on June 24, 1992. I conclude that Mr. Savovski made these efforts at some point in time prior to the motor vehicle accident. This would be more logical for someone operating a business who had identified in the summer of 1990 that his company needed more staff in order to increase production, to fill orders and keep his customers satisfied.
Mr. Savovski testified that he never withdrew the offer of employment -- it was valid from 1990 until Mr. Kojic obtained his work permit. He stated that whenever Mr. Kojic was fit, he would still have a job for him. "I would have work for Zoran anytime". Mr. Savovski was cross-examined as to whether there were any special factors in the relationship between himself and Mr. Kojic. He denied that there were any such special considerations.
A written statement signed by Mr. Savovski and filed as Exhibit 2 contains what could appear to be a second offer made by Mr. Savovski. Mr. Savovski agreed in cross-examination that the statement in Exhibit 2 that he increased the offer to Mr. Kojic to $18.00 per hour after learning of the accident made no sense. He stated that he had perhaps made a mistake in dictating the statement. It is clear from the agreed upon facts that this is not the offer relied upon by the Applicant, and that such an offer, if made, was made post-accident. Thus the only offer I can consider is that made on July 16, 1990 and filed as Exhibit 1.
Conclusion:
The offer of employment of July 16, 1990 was presented to me as one which had been made at arm's length. I was provided with no evidence that this was other than an ordinary business transaction. Clearly, however, Mr. Savovski was trying to be helpful to the Applicant in the course of his evidence.
Section 12 (2)1. speaks of entitlement "at the time of the accident". If I have regard only to the circumstances which existed at the date of the accident, Mr. Kojic could not be said to have been entitled to start work at the time of the accident. He did not have a work permit. This was a condition of the offer. Mr. Kojic was not entitled to start work. Such entitlement would arise only after the condition had been satisfied. Mr. Kojic did not receive his work permit until June 24, 1992, following the motor vehicle accident.
Evidence was led, without objection, by both counsel with respect to the circumstances which took place following the accident. Even if it is appropriate, in the case of conditional offers of employment, to examine events which take place after the accident, to determine if the condition was satisfied, Mr. Kojic would not qualify for a section 12 benefit in my view for three reasons. Firstly, the offer was for a temporary job of 12 months' duration, stated to be open until "as soon as possible". Time was therefore of the essence. In this case more than 22 months elapsed between the date on which the offer was made and the date on which Mr. Kojic obtained his work permit and would have been eligible to start work.
Secondly, while I accept Mr. Savovski's evidence that he did not verbally revoke the offer, there was revocation by his conduct, when he could no longer wait for Mr. Kojic to obtain his work permit and made serious efforts to fill the position with another tool and die maker. I have found that this occurred sometime after January 1991, but before the motor vehicle accident in September 1991.
Thirdly, although Mr. Savovski indicated he would have a job for the Applicant at any time, I was provided with no evidence of such an offer made in writing. Any such job would be pursuant to a different offer than that which was reduced to writing on July 16, 1990, and which I was asked to construe in this arbitration.
Expenses:
An arbitrator has a discretion to award the applicant expenses of the arbitration pursuant to section 282(11) of the Insurance Act. In exercising my discretion I have considered the principles guiding an award of expenses, as set out by Senior Arbitrator Naylor in the case of Ralph McCormick and Economical Mutual Insurance Company, October 2, 1991, OIC File No. A-000139, 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:
The discretion to award expenses should be exercised, having regard to the intent and purpose of the legislative scheme. The arbitration process has been established under the Insurance Act, as amended, in order to facilitate applicants' access to relatively inexpensive, speedy and informal adjudication of disputes regarding no-fault benefits. The discretion to award expenses should be exercised in accordance with this objective, having regard to the individual circumstances of each case.
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.
The Applicant is entitled to his expenses as set out in Schedule 1 of the Dispute Resolution Practice Code in respect of this portion of the arbitration. In the event that the parties cannot agree on the amount of expenses, I remain seized of this issue for a period of 30 days and a party may apply for assessment of the expenses before me.
Order:
The words "within one year" in section 12(2) 1 .(iii) refer to the date of the accident.
Mr. Kojic was not entitled to start work under the terms of the offer of employment.
The Applicant is entitled to his expenses in respect of this portion of the arbitration.
May 4, 1995
Suesan Alves
Arbitrator
Date