Neutral Citation: 1997 ONICDRG 120

OIC A96-001273

ONTARIO INSURANCE COMMISSION

BETWEEN:

AMINE MAHMOUD

Applicant

and

GUARDIAN INSURANCE COMPANY OF CANADA

Insurer

DECISION ON A PRELIMINARY ISSUE

Issues:

The Applicant, Amine Mahmoud, was injured in a motor vehicle accident on August 21, 1994. He applied for and received statutory accident benefits from Guardian Insurance Company of Canada ("Guardian"), payable under the Schedule.¹ Guardian terminated weekly income replacement benefits on October 22, 1994. The parties were unable to resolve their disputes through mediation and Mr. Mahmoud applied for arbitration under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The issue in this hearing is:

1. Is Mr. Mahmoud precluded from receiving income replacement benefits pursuant to section 58(1)(d) of the Schedule in that he was "not authorized by law" to drive an automobile at the time of the accident?

Mr. Mahmoud also claims his expenses incurred in the hearing.

Result:

1. Mr. Mahmoud is precluded from receiving income replacement benefits pursuant to section 58(1)(d) of the Schedule.

2. Mr. Mahmoud is entitled to two-thirds of his expenses incurred in respect of this arbitration.

Hearing:

The hearing was held in Ottawa, Ontario, on April 23, 1997, May 2, and May 23, 1997, before me, Joyce Miller, Arbitrator.

Present at the Hearing:

Applicant:

Amine Mahmoud

Mr. Mahmoud's

James D. Wilson

Representative:

Barrister and Solicitor

Gigi Costanzo

Articling Student

Guardian's

Catherine L. Coplea

Representative:

Barrister and Solicitor

Witnesses:

Julie Lagace

Amine Mahmoud

Albert Bourjaily

Ruth Briand

Maggie McCarthy

Exhibits:

13 Exhibits were filed

Court Reporter:

The proceedings were recorded on May 23, 1997.

Introduction

Mr. Mahmoud was involved in a motor vehicle accident on August 21, 1994 in Ottawa, Ontario. At the time of the accident Mr. Mahmoud had a valid Quebec driver's licence. Guardian submits that when the accident occurred Mr. Mahmoud was a resident of Ontario and was in breach of section 32 of the [Highway Traffic Act]² because he did not have a valid Ontario driver's licence. Guardian therefore submits that pursuant to section 58(1)(d) of the Schedule³ Mr. Mahmoud was not entitled to income replacement benefits on the basis that he "was not authorized by law to drive."

Mr. Mahmoud submits that pursuant to [section 34]⁴ of the Highway Traffic Act he is exempt from the requirement of section 32. Section 34(1) allows a person to drive with an out of province licence if that person's stay in Ontario is only temporary. Section 34(2) allows a new resident of Ontario 60 days to obtain an Ontario driver's licence before section 32 becomes applicable. Mr. Mahmoud relies on both subsections.

In order to determine whether Mr. Mahmoud was or was not "authorized by law to drive" an automobile in Ontario I must determine which province he was a resident of at the time of the accident and when he became a resident of that province.

Evidence:

The parties filed an agreed statement of facts which is attached to this decision.⁵ In addition, the parties presented the following evidence at the hearing.

Mr. Mahmoud's Evidence

Mr. Mahmoud testified that until July 1994 he lived in Gatineau, Quebec with his wife and children. He stated that he and his wife separated in July 1994 and he went to live with his parents in Ottawa. He intended the stay with his parents to be temporary as he hoped to return to Gatineau to live close to his children. Moreover, he hoped to reconcile with his wife.

Ms. Julie Lagace, Mr. Mahmoud's former wife, testified that she asked her husband to leave on June 30, 1994. She stated that she remembered this because it was before a long holiday weekend and that she had the locks changed on the door.

Mr. Mahmoud's brother, Abbis Mahmoud testified that his brother came to live with his parents in July 1994. He remembered this because he had to give up his bedroom and that Mr. Mahmoud also wore his clothes.

Mr. Albert Bourjaily hired Mr. Mahmoud three weeks before the accident to work as a hairdresser. He testified that before Mr. Mahmoud began to work for him on July 25, 1994 he had visited Mr. Mahmoud at his house in the Gatineau several times that summer to discuss the terms of employment.

Mr. Mahmoud filed a form "Verification of the victim's resident status" dated November 13, 1996 wherein he stated that he resided in Quebec until the end of June 1994 and that he did not plan to return full time. This form was originally submitted to the Societe de L'Assurance Automobile du Quebec (SAAQ).⁶

Guardian's Evidence

Guardian presented a significant amount of objective documentary evidence to contradict the testimony of Mr. Mahmoud and the witnesses who testified on his behalf that he was residing in Quebec until July 1994. This evidence is as follows:

• The clinical notes and records of Mr. Mahmoud's family doctor, Dr. Lo, which notes on September 20, 1993 that Mr. Mahmoud is separated from his wife.⁷

• A receipt dated November 18, 1993 in the amount of $4,689.70 for jewellery that Mr. Mahmoud claimed he lost in the accident. The receipt indicates an Ottawa address for Mr. Mahmoud.⁸

• A separation agreement dated November 23, 1993 signed by Mr. Mahmoud which sets out the terms of separation between himself and his wife.⁹

• A judgement confirming the separation agreement dated December 9, 1993 indicating an Ottawa address for Mr. Mahmoud.¹⁰

• An Ontario income tax return for 1993 which indicates that Mr. Mahmoud was a resident of Ontario on December 31, 1993 and that his marital status was "Separe" [Separated]. The Ottawa address in the tax return, which was filed on April 30, 1994, is the same address as in the receipt for the jewellery ¹¹ which is also the address of his parents in Ottawa.

• A signed application for accident benefits by Mr. Mahmoud on September 16, 1994 wherein he stated that he was paying alimony to his wife and clothing expenses for his children since July 1993. He stated that his "marital status for tax purposes" was "legally separated."¹²

Analysis and Findings:

The issue to be decided is whether Mr. Mahmoud is excluded from receiving income replacement benefits because he "was not authorized by law" to drive in Ontario on August 21, 1994.

The burden of proof rests with Guardian to show that, on a balance of probabilities, Mr. Mahmoud "was not authorized by law" to drive in Ontario because he did not have a valid driver's licence pursuant to the legal requirements in section 32 of the Highway Traffic Act. For the following reasons I find that Guardian has discharged its burden. I find that Guardian presented substantial objective evidence to support its submission that Mr. Mahmoud was a resident of Ontario at least since July 1993.

I find that Mr. Mahmoud did not present any credible evidence to support his contention that he was a resident of Quebec at the time of the accident. I find that the evidence presented by Mr. Mahmoud and the witnesses on his behalf was self-serving and not true.

I do not believe Mr. Mahmoud's nor Ms. Lagace's testimony that the separation agreement and the judgment confirming the agreement were false. No reliable objective evidence was presented to support their testimony. I note that the terms of the judgement of their separation agreement, was incorporated into the settlement for "Corollary Relief” in their divorce.¹³

I do not accept Mr. Mahmoud's testimony that his income tax return for 1993, which indicates that he was a resident of Ontario as of December 1993 and that he was separated, is something his bookkeeper told him he must do. This is not plausible.

Moreover, I do not believe Mr. Mahmoud's testimony that there was a typing error in his application for accident benefits where it states he was legally separated since July 1993. Mr. Mahmoud testified that the date should really be July 1994. I do not accept this evidence. The July 1993 date is consistent with Dr. Lo's clinical notes and records, the judgement on his separation agreement and Mr. Mahmoud's tax return for 1993. They all confirm that he was separated from his wife in 1993.

Nor do I believe Mr. Mahmoud's testimony that the receipt for the jewellery, which was dated November 18, 1993 and had an Ottawa address, was a duplicate. Mr. Mahmoud testified that he had received the duplicate receipt in January 1995 and the jeweller had put in his current Ottawa address. I find that there was nothing in the receipt to indicate it was a duplicate. I note that Mr. Mahmoud did not call the jeweller as a witness to explain why the receipt was a duplicate with a November 1993 date.

I give no weight to Mr. Mahmoud's submission that since Dr. Lo's file for 1993 retained Mr. Mahmoud's marital address in Quebec that this was proof that Mr. Mahmoud was a resident of Quebec until July 1994. Dr. Lo's clinical notes and records for September 20, 1993 clearly state that Mr. Mahmoud was separated from his wife.

I give no weight to a document created by Mr. Mahmoud on November 13, 1996 for SAAQ where he stated that he was a resident of Quebec until June 1994.¹⁴ It is clear that this document was created after Mr. Mahmoud became aware that Guardian would not pay him income replacement benefits because it believed that at the time of the accident Mr. Mahmoud was a resident of Ontario and did not have a valid Ontario driver's licence.

While it is not binding on my decision, I note that a letter from SAAQ dated December 3, 1996 stated that Mr Mahmoud is not entitled to claim accident benefits In Quebec because he was not a resident of Quebec at the time of the accident.¹⁵

I find that in September 1994 when Mr. Mahmoud stated in his application for accident benefits that his marital status was "legally separated" and that he had been paying his wife alimony since July 1993 that this was a true statement. This statement is in keeping with Dr. Lo's clinical notes and records, the separation agreement and the judgment confirming this agreement as well as Mr. Mahmoud's Ontario income tax return. All these latter documents were created long before the accident.

Accordingly, I give full weight to Guardian's submission that Mr. Mahmoud was separated from his wife in July 1993 and became a resident of Ontario in 1993. I find that the evidence presented by Mr. Mahmoud to dispute these facts was not credible. In my view, Mr. Mahmoud deliberately tried to change the date of his separation from his wife from July 1993 to July 1994 in order not to be excluded from receiving income replacement benefits.

For all of the above reasons I find that Mr. Mahmoud was a resident of Ontario at the time of the accident. He did not have a valid Ontario driver's licence and therefore pursuant to section 32 of the Highway Traffic Act he was not authorized by law to drive an automobile in Ontario.

Accordingly, I find that pursuant to section 58(1)(d) Mr. Mahmoud is excluded from receiving income replacement benefits.

Expenses:

Although I found Mr. Mahmoud did not present any credible evidence to support his position, I, nevertheless, exercise my discretion to award him two-thirds of his expenses. I find that the hearing was unnecessarily prolonged by Guardian and in my view, Mr. Mahmoud should not be penalized. In my view the two resumptions were not necessary. This case could and should have been concluded in one day.

I found the witnesses presented by Guardian were unnecessary. For example, I did not think it added anything to Guardian's case to present a witness from Revenue Canada to explain the contents of an Ontario Tax Return when its contents was self evident. Nor did I find that the lengthy testimony of the adjuster added anything to the substantial objective documentary evidence in support of Guardian's case.

Accordingly, I find that Mr. Mahmoud is entitled to two-thirds of his expenses incurred in respect of this arbitration.

Order:

1. Pursuant to section 58(1) of the Schedule, Guardian is not required to pay Mr. Mahmoud income replace ment benefit’s with respect to his accide nt on August 21, 1994.

2. Guardian shall pay Mr. Mahmoud two-thirds of his expenses incurred in respect of this arbitration.

June 27, 1997

Joyce Miller Arbitrator

Date

APPENDIX A

ONTARIO INSURANCE COMMISSION

BETWEEN

AMINE MAHMOUD

Applicant

-and-

GUARDIAN INSURANCE COMPANY OF CANADA

Insurer

AGREED STATEMENT OF FACTS

1. The Applicant was involved in a motor vehicle accident on August 21, 1994. The Applicant was operating a 1987 Ford Escort GT owned by Hassan Cheikh and insured by the Respondent under policy number APP2793015.

2. On April 19, 1994, the Ford Escort GT was added to Mr. Cheikh's policy. At the same time, the Applicant was added as an occasional driver of this vehicle. The Respondent was provided via the Broker ("Dale Intermediaries Ltd." with particulars of the Applicants driver's license, being a Quebec driver's license number M5301-010555-00.

3. Though a reference to a Quebec address (195 St. Emilion, Gatineau, Quebec) is noted in the broker's file notes, the broker cannot say whether the Quebec address was a current address or a previous address obtained from prior insurance carrier when inquiries regarding past insurance coverage were made. The named insured on the policy was not the applicant but rather was Mr. Cheikh and the Applicant's address would not and did not appear on the contract of insurance in any event.

4. At the time of the accident, two police reports were prepared, one referring to the Applicant's Ontario driver's license, which was not valid, and another referring to the Applicant's Quebec driver's license, which was not under suspension at the date of the accident, but was suspended on August 23, 1994, two days following the accident, for unpaid parking fines.

5. At the time of the motor vehicle accident, the Applicant did not hold a valid Ontario driver's license. The Applicant had not held an Ontario driving license for a number of years prior to the motor vehicle accident and has not at any time up to the present dated changed the status of his Ontario driver's license.

6. Following the motor vehicle accident, the Applicant applied for weekly income replacement benefits, which benefits were paid to November 24, 1994, in the total amount of $6,113.20.

7. The Respondent provided the Applicant with a Notice of Assessment by Insurance Company dated November 24, 1994 by which the Applicant was notified that the Respondent would no longer pay income replacement benefits to the Applicant in view of exclusions 58(1)(d) and 58(3)(a) of the Statutory Accident Benefits Schedule.

8. The Respondent has withdrawn its reliance on exclusion 58(3)(a) of the Statutory Accident Benefits. The sole ground for denial of benefits being advanced by the insurer is exclusion 58(1)(d) of the Statutory Accident Benefits Schedule.

DATED:

April 22, 1997

(Sgd) James Wilson

MARCUS, PARNEGA & MCNAMARA

Solicitors for the Applicant

(Sgd) Catherine Coplea

COOLIGAN RYAN

Solicitors for the Insurer

No person shall drive a motor vehicle on a highway unless the motor vehicle is within a class of motor vehicles in respect of which the person holds a driver's license issued to him or her under this Act.

The insurer is not required to pay income replacement benefits under Part II... in respect of a person who was the driver of an automobile at the time of the accident, (d) if the driver was not authorized by law to drive the automobile;

(a) a resident of any other province of Canada, who is at least sixteen years of age and has complied with the law of the province in which her or she resides as to the drivers of motor vehicles; or (b) Section 32 and any regulation made thereunder do not apply to a person for sixty days after he or she has become a resident of Ontario if during such period her or she holds a subsisting driver's license in accordance with the laws of the province, country or state of which her or she was a resident immediately before becoming a resident of Ontario. R.S.O. 1980, c.198, s. 20.

Footnotes

1. 1The Statutory Accident Benefits Schedule —Accidents after December 31, 1993, and before November 1, 1996, called "the Schedule" in this decision. The Schedule is Ontario Regulation 776/93, as amended by Ontario Regulation 635/94.
2. 2R.S.O. 1990, c.H. 8, s.32(1) which provides that:
3. 3Section 58(1)(d) provides that:
4. 434.-(1) Section 32 and any regulation made thereunder do not apply to any person who is,
5. 5See Appendix A.
6. 6Exhibit 5, Verification of the Victim's Accident Status.
7. 7Exhibit 2, tab 7, Clinical Notes and records of Dr. Lo.
8. 8Exhibit 2, tab 3, Receipt from Glen Mine dated November 18, 1993.
9. 9Exhibit 2, tab 5, at p. 4, Agreement as to Corollary Relief dated November 23, 1993.
10. 10Exhibit 2, tab 5 at p. 1, Judgement of the Superior Court of Quebec dated December 9, 1993.
11. 11Exhibit 6, tab 2, 1993 Ontario Income Tax Return filed April 30, 1994.
12. 12Exhibit 2, tab 2, Application for Accident Benefits at p. 5.
13. 13Exhibit 4, Judgement of the Superior Court of the Province of Quebec dated February 17, 1995.
14. 14Exhibit 5, Verification of the victim's resident status dated November 13, 1996.
15. 15Exhibit 6, tab 5, letter from the Societe de l'Assurance Automobile du Quebec dated December 3, 1996.