Angelo Unelli v. Guarantee Company of North America, 1998 ONFSCDRS 36

Financial Services Commission of Ontario

Neutral Citation: 1998 ONFSCDRS 36 FSCO A96-002063

Between:

Angelo Unelli Applicant

and

Guarantee Company of North America Insurer

Decision on a Preliminary Issue

Issues:

The Applicant, Angelo Unelli, was involved in a motor vehicle accident on July 29, 1995. He applied for statutory accident benefits from Guarantee Company of North America ("Guarantee"), payable under the Schedule.¹ Guarantee denied his application for weekly income benefits, which he claimed pursuant to section 19 of the Schedule. The parties were unable to resolve their disputes through mediation, and Mr. Unelli applied for arbitration at the Financial Services Commission of Ontario² under the Insurance Act, R.S.O. 1990, c. I.8, as amended.

The issue in this hearing is:

Is Mr. Unelli ineligible to receive weekly benefits, because he was not authorized by law to drive the automobile involved in the accident pursuant to section 58(1)(d) of the Schedule?

Result:

1. Mr. Unelli is ineligible to receive weekly benefits, pursuant to section 58(1)(d) of the Schedule, because he was not authorized by law to drive the automobile involved in the accident.

Hearing:

The hearing was held in Hamilton, Ontario, on August 19, 1998, before me, Dirk C. VanderBent, Arbitrator.

Present at the Hearing:

Guarantee's Representative: Barry Marta, Barrister and Solicitor Guarantee's Officer: Don Wright

Mr. Unelli was not present at the hearing, nor was he represented by an agent or legal counsel. For reasons cited herein, I proceeded with this hearing in his absence. Mr. Unelli did not file any evidence in support of his Application for Arbitration.

Mr. Unelli submitted an Application for Arbitration received by the Commission on December 16, 1996. At that time, he was represented by Mr. Len Sheddon, a consultant with an agency named 'Just Benefits'. A pre-hearing conference was held on August 1, 1997, and a hearing date for the determination of the preliminary issue was scheduled for October 14, 1997. This date was subsequently rescheduled to August 19, 1998, at the request of Mr. Sheddon, and notice of this hearing date, dated October 28, 1997, was sent to Mr. Unelli, as well as Mr. Sheddon. This notice included the following statement:

"If you or your representative do not attend, the Arbitrator may dispose of the case in your absence and you will not be entitled to any further notice of arbitration proceedings."

Mr. Sheddon, by correspondence to the Commission, dated July 20, 1998, advised that he was no longer acting for Mr. Unelli. The Commission, by correspondence dated July 30, 1998, confirmed that Mr. Sheddon was removed from the record, and a copy of this correspondence along with a copy of the notice of this new hearing date, was delivered by courier to Mr. Unelli.

Mr. Marta advised me that, on August 13, 1998, he left a voice mail message for Mr. Unelli inviting him to contact him to discuss settlement of this preliminary issue. He did so, having been advised by settlement officer, Arbitrator Sampliner, that Mr. Unelli had not returned Arbitrator Sampliner's voice mail messages respecting this matter.

At my request, Mr. Marta phoned Mr. Unelli's residence at his home, shortly after 10:00 a.m. on the day of the hearing, and left a message confirming my direction that the matter would proceed at 10:30 a.m. As Mr. Unelli had recorded a voice mail greeting that may have been related to this hearing, I called his residence and listened to it. In this greeting, Mr. Unelli did not specifically identify this hearing, but did indicate that he needed to reschedule "any appointments that were scheduled for today" as he had an important medical appointment to attend later that day which he could not cancel.

Mr. Unelli has had ample notice of this hearing. He also has had ample opportunity to advise either the Commission, either personally, or through communication with Mr. Marta, well in advance of this hearing date, of a request to reschedule this hearing. He has chosen not to do so, nor did he choose to send someone to this hearing to request an adjournment on his behalf. If his voice mail greeting was intended as an adjournment request, I have denied it. Adjournments are not a matter of right. Mr. Unelli's voice mail greeting fell far short of convincing me that medical factors outside his control caused his failure to appear at this hearing.³ Guarantee attended at this hearing, fully prepared to proceed. Considering all the circumstances, fairness required that I do so.

Notwithstanding his failure to attend to present evidence at this hearing, I have not assumed that Mr. Unelli has abandoned his Application. As required by section 282(3) of the Insurance Act, I proceeded with the hearing in order to determine the issues in dispute. I have drawn no adverse inference from his failure to appear. Guarantee acknowledged that it bears the evidentiary onus of establishing that the exclusionary provisions of section 58 of the Schedule, apply to the circumstances of this accident.

Witness:

Ms. Mary Spadone, Representative of the Ministry of Transport, Data Management Division.

Exhibits:

Exhibit 1: Pre-hearing Conference correspondence, dated August 1, 1997. Exhibit 2: Correspondence from the Financial Services Commission confirming Mr. Sheddon's removal from the record as Mr. Unelli's representative. Exhibit 3: Amended Notice of Rescheduled Hearing of Preliminary Issue, dated October 28, 1997. Exhibit 4: Application for Accident Benefits dated 1996/04/09. Exhibit 5: Explanation of Assessment dated 14-05-96. Exhibit 6: Certified copy of Statement of Driving Record, from Ontario Ministry of Transportation, respecting Mr. Angelo W. Unelli. Exhibit 7: Motor Vehicle Accident Report - No. 95-633

Evidence and Findings:

The facts are straight forward. The motor vehicle accident report confirms that Mr. Unelli was the driver of a vehicle which was involved in an accident which occurred on a public highway on July 29, 1995. A certified copy of the Statement of Driving Record, respecting Mr. Unelli, was filed as evidence, and Ministry of Transport representative, Ms. Mary Spadone, verified the information contained therein. Based on this evidence, I find that Mr. Unelli's licence was initially suspended on March 30, 1977, for failure to pay a fine, and that this suspension has never been revoked. Also, his licence expired as of May 21, 1978, and, as of the date of the accident in question, it had never been renewed. As explained below, Mr. Unelli, as of May 21, 1981, could not have renewed his licence simply by paying a renewal fee, as more than three years had elapsed from the date of its expiry. The motor vehicle accident report confirms that Mr. Unelli claimed only that he held an Ontario driver's licence. Ms. Spadone testified that he could not have applied for a valid driver's licence from another province, as he would have been required to surrender his Ontario driver's licence, and this surrender would not be accepted while his Ontario driver's licence was under suspension. Accordingly, I find that, on the day of the accident, Mr. Unelli was operating his vehicle without a valid driver's licence, as the only driver's licence which he could have held was an Ontario licence which had long since expired. In precise terms, Mr. Unelli was unlicensed, his licence was unrenewable, and his right to hold a licence was suspended until the outstanding fine was paid.

I am indebted to Mr. Marta, who provided me with the relevant regulations made under the Highway Traffic Act. Section 1 of O. Reg. 340/94, which came into force on June 6, 1994, provides:

"valid driver's licence" means a driver's licence that is not expired, cancelled or under suspension."

This regulation also confirms that 'Class G' was the class of license required to operate the vehicle which Mr. Unelli was driving when the accident occurred.

Section 3 of O. Reg. 341/94, provides that, respecting an application for a Class G license, a new license may be issued without the requirement that the applicant undergo a vision test, a written examination, and a driver's road test, provided that the applicant held a license which had been issued under the Highway Traffic Act, and which had expired between one and three years before submitting the renewal application.

Section 32(1) of the Highway Traffic Act provides:

"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."

Accordingly, at the time of the accident, Mr. Unelli was not authorized by law to drive the motor vehicle which was involved in the accident.

Section 58 of the Schedule provides:

58.-(1) The insurer is not required to pay income replacement benefits under Part II, education disability benefits under Part III, disability benefits under Part V or loss of earning capacity benefits under Part VI in respect of a person who was the driver of an automobile at the time of the accident,

(a) if, as a result of the accident, the driver is convicted of operating the automobile while his or her ability to operate it was impaired by alcohol or a drug, or of driving while his or her blood alcohol level exceeded the limits permitted by law or of an indictable offence related to the operation of the automobile;

(b) if, as a result of the accident, the driver is asked to provide a breath sample and he or she is convicted for failure to provide the sample;

(c) if, as a result of the accident, the driver is convicted of operating the automobile while it was not insured under a motor vehicle liability policy;

(d) if the driver was not authorized by law to drive the automobile; or

(e) if the driver is an excluded driver under the contract of automobile insurance; or

(f) if the driver knew or ought reasonably to have known that he or she was operating the automobile without the owner's consent.

(2) Clause (1)(d) does not apply to a driver who is not authorized by law to drive an automobile only by reason of a suspension of a licence for failure to pay a fine.

(3) The insurer is not required to pay income replacement benefits under Part II, education disability benefits under Part III, disability benefits under Part V or loss of earning capacity benefits under Part VI,

(a) in respect of any person who has made, or who knows of, a material misrepresentation that induced the insurer to enter into the contract of automobile insurance or who intentionally failed to notify the insurer of a change in the risk material to the contract; or

(b) in respect of an occupant of an automobile at the time of the accident who knew or ought reasonably to have known that the driver was operating the automobile without the owner's consent.

(4) Clause (3)(b) does not prevent an excluded driver or any other occupant of an automobile driven by the excluded driver from recovering statutory accident benefits under a motor vehicle liability policy in respect of which the excluded driver or other occupant is a named insured.

Section 58(1)(d) clearly applies to Mr. Unelli's application for benefits, and disentitles him to receive any class of weekly disability benefits to which he would be otherwise entitled. The only question is whether section 58(2) could apply to override this exclusion. Guarantee has asserted that Mr. Unelli was not authorized to drive an automobile by virtue of the expiry his licence, as distinct from the additional status that his licence was suspended. In fairness to Mr. Unelli, I raised for consideration, the argument that section 58(2) may nonetheless apply, as Mr. Unelli could not have renewed his licence without addressing the suspension. Accordingly, the expired status of his licence could be viewed as ultimately being based on the suspension of his licence due to non-payment of a fine. Guarantee submitted in response, that, had Mr. Unelli obtained the removal of the suspension by payment of the fine, he still would not be authorized to drive, as it would have been necessary for him to requalify for a licence, in the same manner as any person who had never held a driver's licence. I agree with this submission. The status of Mr. Unelli's licence would be no different from any driver who was not under suspension, and who had simply chosen not to renew his or her licence within three years of its expiry. As a result I find that section 58(2) cannot apply to preserve Mr. Unelli's right to receive weekly disability benefits.

I agree with Arbitrator Leitch's determination than an arbitrator appointed under the Insurance Act has no jurisdiction to grant relief from forfeiture under section 129 of the Insurance Act.⁴

Expenses:

At the conclusion of this hearing, Guarantee asserted a claim for expenses of the hearing. However, Guarantee did not proceed with submissions on this issue, on the understanding that either party could return this issue before me for adjudication, if necessary, upon receipt of this decision.

Order:

1. Mr. Unelli is ineligible to receive weekly benefits, pursuant to section 58(1)(d) of the Schedule.

2. If necessary, either party may return before me, regarding any issues respecting payment of expenses of this hearing, and/or other awards payable pursuant to the provisions of section 282 of the Insurance Act.

September 8, 1998

Dirk VanderBent Arbitrator

Footnotes

1. 1The Statutory Accident Benefits Schedule —Accidents after December 31, 1993 and before November 1, 1996, Ontario Regulation 776/93, as amended by Ontario Regulations 635/94, 781/94 and 463/96.
2. 2Effective July 1, 1998, the Ontario Insurance Commission was changed to the Financial Services Commission of Ontario, pursuant to the Financial Services Commission of Ontario Act, S.O. 1997, c.28.
3. 3See Gouliaeff and Commercial Union - Appeal, (OIC P96-00011, July 18, 1996).
4. 4Bodo and Royal Insurance Company of Canada, (October 23, 1997, OIC A96-001102).