Commission des assurances de l’Ontario

Neutral Citation: 1996 ONICDRG 123

Appeal P96-000011

OFFICE OF THE DIRECTOR OF ARBITRATIONS

JOHN GOULIAEFF Appellant

and

COMMERCIAL UNION ASSURANCE COMPANY OF CANADA Respondent

Before: Susan Naylor, Director's Delegate

Counsel: Allen Wynperle (for Mr. Gouliaeff) Guy Farrell (for Commercial Union)

APPEAL DECISION PRELIMINARY ISSUE: EXTENSION OF TIME

Under section 283 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:

The motion to extend the time for requesting an appeal is denied.
The appeal is dismissed, and the arbitration order dated July 24, 1995 is confirmed.

July 18, 1996

Susan Naylor Director's Delegate

Date

REASONS FOR DECISION

I. NATURE OF PROCEEDINGS

In this appeal, Mr. Gouliaeff seeks to set aside an arbitration order, dated July 24, 1995, that ruled against his claim. Mr. Gouliaeff was not present at the arbitration hearing which took place on July 4, 1995, and did not send a lawyer or agent to represent him. He asks for a new hearing at which he has an opportunity to present his case.

Mr. Gouliaeff’s Notice of Appeal was not filed until December 19, 1995, almost five months after the date of the arbitrator's order. Under section 283(2) and (3) of the Insurance Act, a person who wishes to appeal an arbitration decision has thirty days from the date of the order to do so, unless the appeals adjudicator extends the time.

Mr. Gouliaeff asked me to extend the time to allow him to proceed with his appeal, over the objections of Commercial Union Assurance Company of Canada ("Commercial Union"). I dealt with this question as a preliminary motion, receiving written and oral submissions from the parties. The material before me includes the arbitration record, including a transcript of the hearing, the arbitration exhibits consisting of material presented by Commercial Union at the arbitration, and two earlier arbitration decisions involving these parties. Mr. Gouliaeff sent the Ontario Insurance Commission (the "Commission") a number of other medical reports for consideration on the appeal, which were not filed as part of the arbitration hearing. I was provided with affidavits sworn by Mr. Gouliaeff and Patrina Richards. Mr. Gouliaeff supplemented his affidavit orally. Where appropriate, I also had regard to the Commission's file, documenting contact between the parties and the Commission.

II. THE LEGISLATION

Section 283 of the Insurance Act sets out the rules for filing an appeal, including any time requirement involved. Subsection 283(2) states:

(2) A notice of appeal shall be in writing and shall be delivered to the Commission within thirty days after the date of the arbitrator's order and the appellant shall serve the notice on the respondent. [emphasis added]

However, this is qualified by subsection 283(3) which says:

(3) The Director may extend the time for requesting an appeal, either before or after the thirty days, if the Director is satisfied that there are apparent grounds for granting relief to the person and that there are reasonable grounds for applying for the extension, and the Director may give such directions as he or she considers proper consequent upon the extension. [emphasis added]

There are therefore two conditions to be met in order to obtain an extension of time:

There are apparent grounds for granting relief to Mr. Gouliaeff, and
There are reasonable grounds for applying for the extension.

Time limits on appeal exist in order to bring some closure to the adjudication process. Providing a discretion to extend them injects fairness and flexibility into the system. Whether the time should be extended is a discretionary decision which depends upon the facts of each case.

The exercise of the discretion has been considered in several appeal decisions.¹ In Sittler and Canadian General; Sittler and Pilot, (August 11, 1995, OIC File P-000951 & V-000951), the Director of Arbitrations reviewed some of the factors that might be considered, including:

the existence of a bona fide intention to appeal
the length of the delay in applying for the extension;
the merits of the proposed appeal;
any prejudice to the other party and whether it is compensable or not.

III. THE PROCEEDINGS

There is a protracted and fractious history of proceedings between these parties.

Mr. Gouliaeff was riding his bicycle, when he collided with a van on August 17, 1990. Based on the limited evidence before the arbitrator, she found that he went to the Emergency Department at Hamilton General Hospital, where he was treated for soft tissue injuries to his neck, left shoulder and wrist. His family doctor diagnosed a left rotator cuff strain and left wrist sprain.

Later on, Mr. Gouliaeff reported low back pain, which seems to have become his main problem. He attended physiotherapy for a period of time and has been receiving regular chiropractic treatment since mid-1992. He has been seen by several consultants at the request of Commercial Union.

Mr. Gouliaeff was involved in another automobile accident on January 4, 1995, which he claimed exacerbated his earlier injuries. The two accidents have been handled as entirely separate matters, which has complicated things. There is a different insurance company involved and Mr. Gouliaeff hired a different lawyer than he used for the first accident. It seems that the two insurers disagreed about their respective responsibility for benefits and treatment after the later accident, and Mr. Gouliaeff stated that sometime in early 1995, Commercial Union stopped paying for his chiropractic treatment. The proceedings involved in this appeal all relate to the first accident.

The new evidence Mr. Gouliaeff filed on appeal indicates that he attended a program at the Work Injuries Rehabilitation Clinic in early 1995, and underwent various assessments elsewhere in May and June of that year. These reports indicate that he is suffering from chronic pain syndrome, with depression and anger, which are related to the first accident.²

After the first accident, Mr. Gouliaeff claimed statutory accident benefits from Commercial Union, who paid him weekly benefits at $185 a week, on the understanding that he was unemployed beforehand. Disagreements developed about the proper amount of his benefits and about certain other medical and rehabilitation benefits. Mr. Gouliaeff, through his lawyer, Mr. Palios, first started a court action to recover the disputed benefits, but then applied for arbitration, seeking the same relief.

At a pre-hearing, Commercial Union agreed to retroactively raise Mr. Gouliaeff’s benefits to $330.40 a week, based on the "weeks-worked" formula in Scavuzzo v. Canadian Home Assurance Company.³ He was paid a lump sum, taking his benefits up to August 18, 1993, the 156 week mark when the test for weekly benefits becomes stricter. The inquiry shifts from Mr. Gouliaeff’s inability to do his own job to other suitable work.⁴ At that point, his benefits were stopped. Mr. Gouliaeff claimed he was entitled to ongoing benefits, but at a rate of $600 a week, based on an offer of employment he claimed to have received before the accident.

Commercial Union applied several times to have the arbitration dismissed because Mr. Gouliaeff still had his court action pending. Twice, an arbitrator ruled that Mr. Gouliaeff could proceed with his arbitration, but only if he withdrew his court action forthwith. It was not until November, 1994 that the court action was finally withdrawn, a delay of about eighteen months from the arbitrator's first ruling. This delayed the arbitration.

On appeal, Mr. Gouliaeff blamed his lawyer, Mr. Palios, for the procedural wranglings and resulting delay. I accept that the delay may not have been Mr. Gouliaeff's fault, and contributed to his anger, frustration and reluctance to co-operate. Much of his anger has been directed at Commercial Union, even though it was not responsible for the delays.

When the arbitration finally got moving, a pre-hearing conference was arranged for January 27, 1995. Mr. Palios attended without Mr. Gouliaeff, and agreed to a number of productions. These included clinical notes and records from various doctors and treatment facilities, employment records, tax returns, school records and welfare and workers' compensation records.

Mr. Gouliaeff complained that he did not know about the pre-hearing, although the Notice of Resumption of Pre-hearing Discussion, dated December 9, 1994, indicates that it was sent to him. He did admit that he received the arbitrator's letter, dated February 2, 1995, confirming the arrangements made at the pre-hearing. In the event, despite repeated requests to Mr. Palios, Commercial Union was never given any of the documents. The only production was an OHIP order arranged by the arbitrator.

The evidence is that relations between Mr. Gouliaeff and his lawyer, Mr. Palios, became strained. On March 13, 1995, Mr. Gouliaeff wrote to the Commission, saying that he had discharged Mr. Palios as of February 3, 1995. He asked for an adjournment of the upcoming arbitration hearing from May until October or November, to allow a new lawyer time to prepare. He was unsure who would be representing him. On appeal, Mr. Gouliaeff explained that he wanted Mr. Findlay, the lawyer handling his 1995 accident, to represent him at the hearing, but Mr. Findlay told him he was busy with a trial and would only take the arbitration on in the Fall. The Registrar’s Office told Mr. Gouliaeff that it would not reschedule the hearing until Mr. Gouliaeff contacted Commercial Union’s representative to obtain her consent to an adjournment to October or November.

The arbitration hearing commenced as scheduled on May 8, 1995, with Mr. Gouliaeff representing himself.⁵ Settlement discussions ensued, which were apparently successful. Two days later, Mr.Gouliaeff rescinded the settlement (as he was entitled to do under the regulations) and asked to be advised of a hearing date for his arbitration. He said that, in between, he had consulted Mr. Findlay, who told him that if he rescinded the settlement, he would have the opportunity to move the hearing until the Fall, after Mr. Findlay's conflicting trial dates. It is clear that Mr. Gouliaeff was hoping this was the case. Instead, the Commission arranged for a new hearing to take place on July 4, 5 and 6, 1995.

Mr. Gouliaeff blamed Mr. Palios for his production problems and suggested that Mr. Palios should have represented him at the July hearing. It is difficult for Mr. Gouliaeff to escape all responsibility for non-compliance with the production requirements. He said that he had provided his lawyer with whatever was necessary, and it was his lawyer's failure to forward the material to the appropriate people that led to the problem. I did not have the benefit of Mr. Palios' file but a different picture emerges from the correspondence of the lawyers in this case. In any event, however, it is clear from the evidence that Mr. Palios was no longer acting for Mr. Gouliaeff, at Mr. Gouliaeff's own insistence, by the time of the aborted May 8, 1995 hearing, and was out of the picture altogether after that time. I do not accept that Mr. Gouliaeff was in any doubt about this.

Mr. Gouliaeff was aware that none of the required documentation had been provided. He appeared to have done next-to-nothing towards preparation for his arbitration hearing, and admitted that, as of the date of the appeal hearing, nothing further had been done about the missing productions.

Although he received the notice advising him of the hearing date, Mr. Gouliaeff did not show up at the hearing on July 4, 1995, and did not send anyone to represent him. There was no explanation for his absence in the file and he did not send any documentation in advance, to support his claim.

According to the transcript of the arbitration, Commission staff attempted to reach Mr. Gouliaeff by telephone that morning, but no success. The arbitrator waited for 45 minutes beyond the scheduled time in case he was delayed. She then invited Commercial Union to proceed with its case.

After reviewing Commercial Union's evidence and hearing its submissions, the arbitrator dismissed Mr. Gouliaeff’s claims. She held that he was not entitled to continued weekly income benefits because his back complaints were probably not accident-related and, in any event, he was not disabled from his own or other suitable work. She also refused to increase the amount of Mr. Gouliaeff’s benefits based on the alleged offer of future employment. She rejected a letter written two years after the accident by the purported employer, which she found vague and unreliable. The arbitrator likewise refused Mr. Gouliaeff's claims to the cost of an orthopaedic mattress, future housekeeping services, continued chiropractic treatment and associated taxi fares to and from his chiropractor's office. She held that Mr. Gouliaeff had failed to verify his treatment and rehabilitation needs, even though he had been told to do so in mediation proceedings as early as April, 1993. She also found that his need for more treatment was contradicted by the insurer's consultant. The arbitrator ordered Mr. Gouliaeff to repay $4,726 of the $32,879 he had received for taxi fares, mainly to and from chiropractic treatment, because she concluded that these particular charges did not involve travel for treatment or therapy. She refused to allow Mr. Gouliaeff his arbitration expenses and ordered him to pay $1,000 to reimburse Commercial Union for the assessment it was required to pay to participate in the arbitration. In making this order, the arbitrator took into account the delay involved in discontinuing the court action, Mr. Gouliaeff 's failure to comply with production requirements and his failure to attend the hearing or file any evidence.

The arbitrator's order with reasons, dated July 24, 1995, was sent to Mr. Gouliaeff. He acknowledged receiving the written decision at the end of that month. The Commission did not hear anything from Mr. Gouliaeff until four months later, when it received a letter, dated November 27, 1995, from another lawyer, William Morris. The letter indicated that Mr. Morris had interviewed Mr. Gouliaeff prior to leaving for a holiday on October 28, 1995, but Mr. Gouliaeff's retainer was not delivered until Mr. Morris was away. Mr. Morris wrote that when he had an opportunity to assemble the documentation, including Mr. Palios' file, he intended to file an appeal on behalf of Mr. Gouliaeff. The Notice of Appeal was faxed to the Commission on December 19, 1995.

Mr. Gouliaeff filed several medical reports about his mental and psychological health in May and June 1995. According to these reports, in late March, 1995, Dr. Till, a chiropractor at the Work Injuries Rehabilitation Clinic, referred Mr. Gouliaeff to Dr. Dunn for a psychological assessment, because he appeared to be in "severe psychological distress". He told Dr. Dunn over the telephone that Mr. Gouliaeff had gone to St. Joseph's Hospital Emergency Psychiatry earlier in the year, with depression and suicidal ideation. Dr. Dunn assessed Mr. Gouliaeff on May 29 and 30, 1995, and reported his results in early August, after the hearing.

Dr. Dunn identified depression with suicidal ideation, and significant unresolved anger as Mr. Gouliaeff's principal psychological problems. He attributed these to the effect of the physical limitations and pain Mr. Gouliaeff experienced as a result of his injuries from the 1990 accident. He recommended psychotherapy and suggested a participatory approach to Mr. Gouliaeff 's rehabilitation that would reduce his hostility to his health care professionals.

Dr. Dunn's findings were consistent with the results of a multi-disciplinary assessment carried out over five days in mid-June at the Behavioural Medicine Centre in Hamilton. The results of the various assessments were reported to Gan Canada, the insurer of the 1995 accident, in mid-August.⁶ The report concluded that Mr. Gouliaeff was suffering from chronic pain syndrome, including an element of clinical depression, as a result of his 1990 accident-related injuries. Mr. Gouliaeff reported having suicidal ideation, but the doctors' report did not mention the St. Joseph's visit and suggested that Mr. Gouliaeff’s suicidal thoughts were at their strongest in the Fall of 1994. The doctors' findings excluded a head injury or post-traumatic stress disorder as the cause of Mr. Gouliaeff’s current symptoms, although they thought these might have been contributing factors in his earlier recovery. They concluded that Mr. Gouliaeff required a six-month comprehensive interdisciplinary rehabilitation program. In their view, Mr. Gouliaeff was currently disabled from his electrical work due partly to physical limitations and partly to cognitive and behavioural factors outside his control. Although they felt that he had the potential to return to many of his pre-accident electrical work activities, they thought that some of the activities could be uncomfortable and so difficult to tolerate over a longer period. They therefore suggested additional training towards an electrician's license, which would make Mr. Gouliaeff more competitive and expand his opportunities for lighter work.

IV. FINDINGS AND ANALYSIS

There is no basis for concluding that the arbitrator was wrong in proceeding with the hearing in Mr. Gouliaeff’s absence. Mr. Gouliaeff was sent a notice of hearing a reasonable time beforehand and obviously received the notice. The notice warned him that if he or his representative did not attend the hearing, the arbitrator could dispose of the case without him, and without giving him further notice.⁷ There was nothing before the arbitrator that would cause her to question going ahead. Mr. Gouliaeff did not provide any medical information that might suggest he should not proceed and there was no explanation for his absence.

Under the rules governing arbitrations, an arbitrator may not simply dismiss an application solely because the person does not attend, but may proceed without the party being present.⁸ In this case, the arbitrator went ahead with the hearing and considered the evidence before her, as she was entitled to do.

Mr. Gouliaeff suggested that it was unfair to make him go ahead without his chosen counsel. However, Mr. Gouliaeff had not retained Mr. Findlay to act for him in this matter, and it appears, he never did. There was no evidence that he looked for a lawyer to represent him within the time frames acceptable to the Commission. In view of the delays which had occurred in this case, it is not surprising nor unfair that the Commission proceeded with the arbitration, given the uncertainty and vagueness of Mr. Gouliaeff’s arrangements to obtain counsel and the potential for yet more delay.

Mr. Gouliaeff claimed that he missed the hearing because he had been told it had been re-scheduled for a later date. He said that he still wanted an adjournment until the Fall, so that Mr. Findlay could take over. He felt that he should not have to go ahead on his own because of the poor state of his mental and psychological health. Mr. Gouliaeff said that he inquired about an adjournment at the Commission, but when this was unsuccessful, he went to the Ombudsman's Office. According to his evidence, he had several telephone conversations with Gini Johnson, a member of the Ombudsman's staff; and some correspondence passed between them. His then-girlfriend, Patrina Richards, passed on a message from Ms. Johnson during the last week in June that the hearing had been adjourned. In her affidavit, Ms. Richards swore that she took a phone call from Ms. Johnson in the last week of June, and was told that the arbitration hearing had been moved from July 4, 1995 to "the middle of August, 1995". Mr. Gouliaeff was more specific in his affidavit, stating that Ms. Johnson left word with Ms. Richards that the hearing would be rescheduled to August 19, 1995.

Mr. Gouliaeff did not confirm these arrangements with anyone at either the Commission or the Ombudsman's office, as he assumed everything had been taken care of. It was his evidence that he had every intention of attending the August date to pursue his claim, and that he continued to prepare for it until, out-of-the-blue, he received the arbitrator's decision.

Mr. Gouliaeff said that when he got the decision he "basically had a nervous break-down". He was suffering from severe, suicidal depression and could not cope with the demands of daily living or organise himself sufficiently to retain legal counsel. Because of this, he did not contact the Ombudsman's Office or the Commission to tell them about the mix-up or try to get legal advice about what to do. He explained that he did not know about the time limits for filing an appeal. He did not consult his other lawyer, Mr. Findlay, because Mr. Findlay had already told him that he was too busy to take anything on until the Fall.

Mr. Gouliaeff may well have contacted the Ombudsman's office for help with his case. However, it is an entirely different matter that this evolved into an understanding that his Commission hearing had been adjourned. I have given the sworn evidence of Mr. Gouliaeff and Ms. Richards very careful consideration, but aspects of Mr. Gouliaeff’s explanation are troubling and make little sense. I am forced to the conclusion that the description of events advanced is not credible. My concerns include the following:

I would reasonably expect there to be some corroborative documentation of Mr. Gouliaeff’s story. However, he did not produce any letters or other independent evidence of Ms. Johnson's involvement, and there was no communication to, from or in respect of the Ombudsman's Office in the Commission file. According to Mr. Gouliaeff's counsel, Ms. Johnson had left the Ombudsman's Office by the time he tried to contact her to verify Mr. Gouliaeff's account of things. While conceivable, it is improbable that there would not be any record of the Ombudsman's intervention and/or the purported adjournment in either the Ombudsman's or the Commission's files. In the usual course, one would expect the records of a government agency, such as the Ombudsman's Office, to survive the departure of an employee. It is reasonable to expect a party in this situation to make some effort to track down supporting documentation, where there is a good probability of its existence and the inquires required are quite modest.

There are other puzzling aspects to the story. I note that the new hearing date referred to in Mr. Gouliaeff's affidavit is a Saturday: not a usual day for a Commission hearing, although again, not impossible.

It is also difficult to understand why the re-scheduled August date met Mr. Gouliaeff's needs and was acceptable to him. Mr. Gouliaeff stated that he wanted the adjournment so that his other lawyer, Mr. Findlay, could represent him. However, he knew that Mr. Findlay was too busy to take on his case until the Fall. Indeed, he gave this as the reason why he did not consult Mr. Findlay when he received Arbitrator Makepeace's decision at the end of July. There is no evidence that, in the month inbetween, he made any effort to retain a lawyer for the supposed new hearing date in August, or that he made any preparations in advance of it, apart from his say-so.

In view of Mr. Gouliaeff's story, I would have expected him to have protested vigorously to the Ombudsman's Office or the Commission, if he had been misinformed about an adjournment. However, he did not contact either the Ombudsman, the Commission or a lawyer after he received the arbitration order.

It would be an entirely different matter if medical factors outside his control caused him to miss the hearing, to misunderstand his responsibilities or otherwise explained his actions. Indeed, if I had any hesitation in this regard, I would allow the appeal. This was not however Mr. Gouliaeff's position. The argument seems to be that he would have attended the July 4 hearing, had he not been told about the adjournment. Further, he states categorically that he was fully intending to appear at the August hearing to pursue his claim.

While the medical reports Mr. Gouliaeff produced suggest that he has significant emotional and psychological problems, they do not suggest that these problems were totally incapacitating, or so serious as to explain his behaviour in this matter.

I also do not accept Mr. Gouliaeff's explanation for not taking prompt action after he received the arbitrator's decision. The May and June assessments do not indicate that his condition rendered him incapable of organising himself to seek legal help or contact the Commission. Mr. Gouliaeff did not file any later evidence of his health to support his assertion that he had a breakdown. The fact that Mr. Gouliaeff has been diagnosed as suffering from chronic pain, depression and anger does not warrant this leap of judgement.

In my view, Mr. Gouliaeff’s conduct is more likely explained by the history of the case. He was angry and frustrated by his dealings with Commercial Union and the Commission. He wanted an adjournment of the July 4, 1995 hearing until the Fall. He had not done anything to prepare for his hearing. He had already succeeded in getting his way the first time in May, 1995, by cancelling a settlement. I suspect that he gambled on succeeding a second time, only to find out that the hearing went ahead without him.

Not only is there an inadequate explanation for his absence from the hearing, there is not much evidence before me to show that Mr. Gouliaeff would be likely to succeed in the claims that were arbitrated. Except for the June, 1995, multi-disciplinary assessment, his medical evidence does not deal with whether he is disabled from work, and that report does not address the applicable post-156 week test. The evidence provided by Mr.Gouliaeff, for the most part, does not address the other issues before the arbitrator: quantum, the need for chiropractic treatment, taxi expenses, housekeeping services, and a request for an orthopaedic mattress. I have only an assertion that "had the Applicant had an opportunity to present his evidence at the arbitration, there would have been ample evidence"⁹ to support his claims. This is not sufficient to persuade me that there are apparent grounds for granting relief, especially given the amount of time that Mr. Gouliaeff has had to marshall his case.

Mr. Gouliaeff’s counsel argued that the prejudice to Mr. Gouliaeff in extinguishing his rights outweighs any other considerations. Were I just considering a failure to comply with the time limit for filing an appeal, I might view this matter somewhat differently. However, this failure must be seen in the context of the course of these entire proceedings, including:

An eighteen month delay in complying with an order to discontinue a court action;
Numerous motions and appearances;
A failure to comply with production requirements;
An adjournment necessitated by an aborted settlement;
A failure to attend the hearing;
A failure to file evidence in support of the case.

I accept that these may not have been all Mr. Gouliaeff’s fault. However, a review of the material shows that, throughout, he has been given a great deal of indulgence. Commercial Union has understandably incurrred substantial costs during these lengthy, fractured and largely unproductive proceedings. These cannot be compensated for in an expenses award. Weighing all the circumstances, I am not persuaded that there are apparent grounds for granting relief or that there are reasonable grounds for applying for the extension. Therefore, the motion requesting an order extending the time for filing the appeal is denied and the appeal is dismissed. There is no order as to appeal expenses.