Neutral Citation: 1999 ONFSCDRS 114

FSCO A98-001306

BETWEEN:

RAYMOND BUDD

Applicant

and

PERSONAL INSURANCE COMPANY OF CANADA

Insurer

Before:

M. Kaye Joachim

Heard:

May 25 and 26, 1999, at the Offices of the Financial Services Commission of Ontario in Toronto.

Appearances:

Stan Raphael for Mr. Budd

Mark H. Fonseca for Personal Insurance Company of Canada

The Applicant, Raymond Budd, was injured in a motor vehicle accident on March 19, 1997. He applied for and received statutory accident benefits from Personal Insurance Company of Canada ("Personal"), payable under the Schedule.¹ Personal terminated weekly income replacement benefits on March 24, 1998. The parties were unable to resolve their disputes through mediation, and Mr. Budd applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The issues are:

Did Mr. Budd know or ought he reasonably to have known that he was operating the 1991 Honda Civic automobile while it was not insured under a motor vehicle liability policy, under subsection 30(1)(a) of the Schedule?
If so, is the Insurer entitled to repayment of income replacement benefits under subsection 47(1)(b) of the Schedule?
Is the Insurer entitled to repayment of other benefits under subsection 47(1)(a) of the Schedule?

Mr. Budd knew or ought reasonably to have known on March 19, 1997, that he was operating the 1991 Honda Civic automobile while it was not insured under a motor vehicle liability policy.
Mr. Budd shall repay $6,357.02 in income replacement benefits.
Mr. Budd is not required to repay any other benefits.

The Insurer sought to add the issue whether Mr. Budd was using his vehicle for commercial purposes, rather than for personal use, and was therefore disqualified from receiving benefits under subsection 30(2)(a) (material misrepresentation or change in risk). The Insurer sought to characterize the issue in dispute as Mr. Budd's entitlement to benefits. The Insurer argued that its reliance on subsection 30(2)(a) was not a new issue, but simply an additional reason for denying benefits. The Applicant objected to the addition of the subsection 30(2)(a) issue on the grounds that it had not been mediated. I ruled orally that the only issues before me in this proceeding were as described above, and that I would not determine whether Mr. Budd was in breach of subsection 30(2)(a) of the Schedule. These are the reasons for my ruling.

The Insurer first advised Mr. Budd on March 24, 1998, that it was relying on subsection 30(1)(a) of the Schedule to terminate benefits because Mr. Budd had operated the 1991 Honda Civic while he knew or ought reasonably to have known that it was not insured. Mr. Budd applied for mediation and the Report of the Mediator confirmed that the parties disputed whether Mr. Budd was disqualified under subsection 30(1)(a). Mr. Budd applied for arbitration and the pre-hearing arbitrator identified the issues as:

Was there a valid policy of insurance with Personal Insurance Company in effect at the time of the motor vehicle accident of March 19, 1997 for the 1991 Honda Civic automobile in question?²
If there was no valid policy of insurance for this automobile, is the Applicant obligated to repay the Insurer the income replacement benefits as well as housekeeping and home maintenance benefits already paid to the Applicant?

Arbitrator Jones specifically noted that the issue whether the Applicant was precluded from receiving benefits if he was using the vehicle for commercial purposes had not been mediated and he declined to add it to the proceeding. He asked the Applicant's counsel to advise the Insurer whether he would agree to adding the issue, so that the Insurer's counsel could take steps to have the issue mediated and added to the proceeding in the absence of consent. Applicant's counsel did not specifically agree to the addition of this issue, and the Insurer's counsel did not apply for mediation.

Having regard to the prehearing letter, it appears to me that the proper course for the Insurer to have taken, if it had any doubt about the Applicant's willingness to add the subsection 30(2)(a) issue, was to apply for mediation on that issue. It did not do so, and I declined to add that issue to this proceeding.

During the course of the hearing I nonetheless heard considerable evidence about whether the vehicle in question was being used for commercial purposes. This evidence was adduced for the purpose of challenging the credibility of Mr. and Mrs. Budd and not for the purpose of determining whether there had been a breach of subsection 30(2)(a). Although I may comment in my decision about the use of the vehicle, nothing in this decision should be interpreted as a final determination of that issue.

Effect of Delay in Raising Subsection 30(1)(a):

The accident occurred on March 19, 1997. Mr. Budd applied for and received income replacement benefits and other benefits. The Insurer did not advise Mr. Budd of its intention to rely on subsection 30(1)(a) until one year later, on March 24, 1998. I have considered this delay in assessing the evidence, and the ability of Mr. and Mrs. Budd to marshall evidence to support their position that they believed that the 1991 Honda Civic was insured at the time of the accident. I have also considered the delay in the context of the estoppel arguments raised by the Applicant, which are discussed below.

1. Did Mr. Budd know or ought to reasonably have known that he was operating the 1991 Civic Honda while it was not insured under a motor vehicle liability policy?

Documentary evidence of cancellation of coverage for the 1991 Honda Civic

Rose Budd first obtained coverage for the 1991 Honda Civic effective November 3, 1995. At that time, two other vehicles were also insured under her policy.³ Based on the information provided by Rose Budd, the vehicle was initially rated as class 01, meaning that it would be used strictly for pleasure and not for driving to work. The policy covering the 1991 Honda Civic was renewed April 1, 1996. In May 1996, Mrs. Budd requested that one of the vehicles currently insured under her policy, a 1987 Toyota Tercel, be deleted from her policy, leaving two vehicles insured under her policy, the 1990 Ford Tempo and the 1991 Honda Civic.

On March 14, 1997, Mike Alma, a customer service representative from Personal, received a fax from Rose Budd, requesting him to remove the 1991 Honda Civic from her policy, leaving everything else the same. The facsimile, reproduced in its entirety, is set out below:

DATE: MARCH 14, 1997

#416-620-3911

FAX - PERSONAL INSURANCE

To: MIKE

Re: POLICY 1001966

PLEASE REMOVE 1991 HONDA AND LEAVE EVERYTHING ELSE THE SAME.

THANKS.

Rose Budd (signature)

Attached to the fax was a copy of the vehicle and plate ownership papers, indicating that the registered owner of the 1991 Honda Civic effective March 13, 1997 was Raymond Budd.

Mike Alma testified that he dealt with thousands of calls every year and had no recollection of a conversation with Rose Budd about the deletion of the 1991 Honda Civic. He testified as to his usual practice, and what he believed he would have done, based on the written documentation and computerized records.

Mike Alma testified that based on the March 14, 1997 written request from Rose Budd he would have completed an Auto Endorsement Form, deleting the 1991 Honda Civic effective March 14, 1997. Mike Alma testified that the usual process is that this form is reviewed by a Quality Assurance Officer and then sent to a Data Entry Operator to enter the information onto the computer. This process took over two weeks, and the information was finally keyed into Personal's computer system on March 31, 1997.⁴

On March 31, 1997, Personal's computer system issued an amended certificate of insurance, confirming the deletion of the 1991 Honda Civic from the 1996 policy (April 1, 1996 to April 1, 1997), effective March 14, 1997. It advised that a refund of $40 would be issued. A refund cheque dated March 31, 1997 was subsequently issued and cashed by Rose Budd on May 5, 1997.⁵

The Evidence of Mr. and Mrs. Budd:

Raymond and Rose Budd have been married since 1975. They have one daughter, Christine Budd, now 20 years old. In the years prior to the 1997 accident, Mr. Budd had moved out of the family home on several occasions to live separately, and then returned home again. Despite these separations, the Budds continued to share financial arrangements and vehicles. During the month prior to the accident, the Budds were undergoing one of their periods of separation and Raymond Budd was living with his mother at 11753 Sheppard Avenue.

Mrs. Budd was responsible for obtaining insurance for the various vehicle owned by the family. Although Rose Budd was the registered owner of several vehicles, both Raymond and Rose Budd considered the cars to be jointly owned. All three Budds had access to and use of the cars and they tended to use whichever car was available.

Mrs. Budd confirmed that she added the 1991 Honda Civic to her existing insurance policy with Personal in November 1995. She testified that she recalled discussing with a customer service representative from Personal the use to which the vehicles would be put. She advised that she drove to work regularly, that her daughter used the cars for pleasure, and that her husband only occasionally took a car to work. The insurance policy was renewed in 1996. She never advised the insurance company about any change in the use of the vehicles, although she understood that at some point her husband began using the family vehicles to make deliveries.⁶

In early 1997, the Budds discussed transferring ownership of the 1991 Honda Civic to Mr. Budd, in order that he could trade it in for a truck to expand his business. They went to the Ministry of Transportation together to effect the transfer, but were advised that in order to avoid paying transfer tax, they had to complete a form confirming that the car was being transferred between spouses. On March 8, 1997, they attended together at the Laurentian Bank to complete the required form and have it notarized. The Budds testified that from that point, the understanding between them was that Rose Budd would arrange to transfer the ownership of the vehicle to Raymond Budd at the end of March 1997, when Mrs. Budd's current insurance policy came up for renewal, and would further arrange an insurance policy for Mr. Budd beginning April 1, 1997.

Mrs. Budd telephoned a representative of Personal Insurance in March 1997 to discuss various matters, including her intention to transfer the ownership of the 1991 Honda Civic to Raymond, to delete the vehicle from her policy, and to obtain a new policy for Raymond Budd. She testified that she spoke with someone named "Mike,"⁷ who told her he didn't want to do anything until the car was transferred. Mike asked for Raymond Budd's address and asked her to send a copy of the ownership papers. She went to the Ministry of Transportation on March 13, 1997 and transferred the ownership. She called Mike again on March 14, 1997 and told him she had changed the ownership. He told her to write a letter, confirming the deletion of the 1991 Honda Civic from her policy. She testified that she was tired from working the previous night, and she asked him to dictate the exact words to delete the vehicle. She agreed that she faxed the message to delete the 1991 Honda Civic to Mike on March 14, 1997, along with a copy of the ownership papers.

Rose Budd testified that she wanted to delete the 1991 Honda Civic at the end of the month, and that she told Mike this, although her written note did not specify a date. She testified she asked Mike to issue a new policy in Raymond Budd's name to insure the 1991 Honda Civic, effective April 1, 1997.

She also testified that she was concerned about whether the vehicle would be insured under her policy during the last two weeks of March 1997 until Raymond Budd would be issued his new policy insuring the vehicle. She stated that she specifically asked Mike about coverage for this period, and that she was assured by Mike that the vehicle was covered under her policy until the end of March 1997. She confirmed that Mike gave her this assurance, despite being advised that the ownership had been transferred to Raymond Budd.

In contrast, Mike Alma testified that he would not have agreed to extend insurance coverage on the 1991 Honda Civic to March 31, 1997 under Mrs. Budd's policy, since Mrs. Budd was no longer the registered owner of the vehicle and therefore, she had no insurable interest in the vehicle after that date. He also testified that he would not have agreed to issue a policy in Mr. Raymond Budd's name without talking to him first and completing a worksheet on Mr. Budd.

Mrs. Budd testified that she placed the new ownership papers in the glove compartment of the 1991 Honda Civic, but did not tell her husband that she had effected the transfer, deleted the 1991 Honda Civic from her policy, or arranged for him to receive his own insurance policy at his mother's address.

On March 19, 1997, Raymond Budd was driving the 1991 Honda Civic when he was involved in an accident. He testified that although he began the day by making deliveries, he was on a personal errand when the accident occurred. When a police officer questioned him about the ownership of the vehicle, he stated that his wife was the owner. When the officer advised him that the car was registered in his name, he was surprised. After being released from hospital, his wife drove him to his mother's home at the Sheppard Avenue address. He questioned his wife about the officer's statement that the vehicle was registered in his name. It was at that time, he testified, that Rose Budd first told him that she had already transferred the ownership to him. He also recalled her assuring him that he was covered until April 1, 1997, and that he would receive his own policy from April 1, 1997.

Shortly after the accident, Raymond Budd decided he was too injured to return to work, and that he no longer needed an insurance policy in respect of the 1991 Honda Civic (which had been destroyed in the accident). Accordingly, he testified that he phoned the Personal Insurance Company and spoke to a customer service representative to cancel the policy he thought Rose Budd had arranged for him.

Conclusions on the Cancellation of the Policy

The documentary evidence indicates that Rose Budd instructed the Personal to delete the 1991 Honda Civic from her insurance policy on March 14, 1997. This instruction was carried out, and a refund of $40 for the remaining two weeks of the policy was issued. The information was not keyed into Personal's computer system until March 31, 1997, by which time the accident of March 19, 1997 had been reported, and processed as though the 1991 Honda Civic was still insured under Mrs. Budd's policy.

In contrast to the documentary evidence, is the evidence of Rose Budd that she instructed Mike Alma to delete the coverage at the end of March 1997, and to issue a new policy covering the vehicle to Raymond Budd effective April 1, 1997. If I accept her evidence that she sincerely believed that the 1991 Honda Civic was insured under her insurance policy until the end of March 1997, and that she never advised her husband otherwise, it follows that Raymond Budd had no reason to believe he was operating the vehicle without insurance.

In weighing the conflicting evidence, I have tested the harmony of the testimony with the preponderance of the probabilities that a practical and informed person would recognize as reasonable in the circumstances.

The credibility of interested witnesses, particularly in cases of conflict of evidence, cannot be gauged solely by the test of whether the personal demeanour of the particular witness carried conviction of the truth. The test must reasonably subject his story to an examination of its consistency with the probabilities that surround the currently existing conditions. In short, the real test of the truth of the story of a witness in such a case must be its harmony with the preponderance of the probabilities which a practical and informed person would readily recognize as reasonable in that place and in those conditions. ...

The trial Judge ought to ... say that evidence of the witness he believes is in accordance with the preponderance of probabilities in the case and, if his view is to command confidence, also state his reasons for that conclusion.⁸

I conclude that the Budds' version of events is not in accordance with the preponderance of probabilities in the case for the following reasons.

Mrs. Budd testified that the reason her written request of March 14, 1997 did not specify that the Honda Civic should be deleted on March 31 or April 1, 1997 is that Mike Alma dictated the letter to her. However, the year previously, she had written a similar letter deleting the 1987 Toyota Tercel from her policy. On March 25, 1997, she drafted another letter, asking that Raymond Budd be deleted from her policy. She did not ask anyone to dictate the terms of those very similar letters.

Neither Rose Budd nor Raymond Budd offered any convincing explanation why they wanted to delay transferring the 1991 Honda Civic to Mr. Budd until March 31, 1997. Mrs. Budd's explanation that she wanted to delete the 1991 Honda Civic at the end of March 1997, and wanted to delay obtaining a new policy for Raymond Budd until April 1, 1997, to correspond with the renewal date of her policy, is unconvincing. In the past, Mrs. Budd has added, deleted and substituted vehicles, midway during the term of her insurance policy. On March 27, 1997, she substituted a leased 1997 Honda Civic for her 1990 Ford Tempo, with only three days left before the renewal date of April 1, 1997.

Rose Budd's testimony that she instructed Mike Alma to delete the 1991 Honda Civic from her policy at the end of March 1997 is inconsistent with her alleged request to Mike for an assurance that the vehicle was indeed insured for the last two weeks in March. If she had told Mike to delete the vehicle at the end of March 1997, she would not need a further reassurance on that point. If , on the other hand she instructed the Insurer to delete the vehicle effective March 14, 1991 (which her written document indicates), it is difficult to understand why she believed the vehicle would continue to be insured after that date.

Rose Budd's testimony that she did not understand the significance of transferring ownership to Raymond Budd on March 13, 1997 is also inconsistent with her insistence on obtaining a reassurance from Mike that the vehicle would continue to be insured under her policy until the end of March 1997. Rose Budd may have been unaware that the transfer of ownership to Raymond could mean that she no longer had an insurable interest in the vehicle.⁹ In that case, she would not have pressed Mike Alma for an assurance that the vehicle would continue to be covered until the end of the month. By allegedly pressuring Mike Alma for an assurance that the car was insured under her policy until March 31, 1997, she displayed some awareness that the transfer of the vehicle to Raymond Budd in mid-March was a significant event, which could affect the insurability of the vehicle under her policy.

It is possible that Mike Alma could have failed to record Mrs. Budd's verbal request to delay deleting the policy until March 31, 1997 and mistakenly completed the auto endorsement form to delete the vehicle effective March 14, 1997.

It is possible that he could have specifically assured Mrs. Budd that a car she no longer owned could still be insured under her policy for a further two weeks.

It is possible that he could have agreed to issue a policy in Raymond Budd's name without speaking to him to obtain his driver information, discuss his use of the car, the type of coverage required, the premium to be charged, and the method of payment.

It is possible that despite agreeing to issue a policy, he simply failed or forget to do so.

If this case had turned on my accepting the possibility of any of these mistakes, I might have done so. But I find it unlikely that all of these errors and omissions occurred.

Mr. Budd's claim to have telephoned the insurance company to cancel the requested policy, while conveniently explaining the absence of any policy documents, is inconsistent with his other evidence. Mr. Budd emphasized that he never handled insurance matters and that his wife always arranged the insurance. This supports their position that Rose Budd was supposed to arrange for an insurance policy to be issued in Mr. Budd's name effective April 1, 1997. However, he testified that a few days after a serious accident, he supposedly initiated his first contact with the insurance company in order to cancel a policy which would otherwise have been sent out to him. If Mrs. Budd could arrange the insurance for him, before the accident, surely she would also have taken responsibility after the accident, when he was injured, to cancel the policy.

Finally, I found the Budds' evidence about Mr. Budd's use of the 1991 Honda Civic to make deliveries and their avowed ignorance of the fact that the use to which the vehicle was put could affect the premium, unbelievable.¹⁰ While this is not a significant factor in my deliberations, it is consistent with my conclusions about the veracity of the Budds' testimony with respect to the cancellation of the insurance for the 1991 Honda Civic.

I conclude that Mrs. Budd's explanation concerning the deletion of the 1991 Honda Civic from her policy is not credible. I conclude, based on Mrs. Budd's written fax and the attached ownership documents, that she instructed Personal to delete the 1991 Honda Civic from her policy effective March 14, 1997. The vehicle was deleted effective March 14, 1997. I find that she did not ask anyone at Personal to issue a policy in Raymond Budd's name. Therefore, I conclude that Mrs. Budd knew that the 1991 Honda Civic was not insured after March 14, 1997.

I must still determine whether or not Mr. Budd knew on March 19, 1997 that the 1991 Honda Civic had been deleted from the insurance policy.

If Mrs. Budd did not tell Mr. Budd that she had deleted the 1991 Honda Civic from her policy, then she was deliberately exposing him to the risk of driving without insurance. On the other hand, if she did tell him, then it is Mr. Budd who deliberately took the risk of driving a vehicle while it was not insured.

While I would be prepared to presume (in the absence of compelling evidence to the contrary) that Mr. Budd would not deliberately drive an uninsured vehicle, this presumption does not assist me in this case, since I also presume that Mrs. Budd would not deliberately expose her husband to the risks of driving without insurance. I am mindful of the possibility that Mrs. Budd simply forgot to tell him. However, the Budds' evidence with respect to the alleged cancellation effective March 31, 1997, the alleged new policy effective April 1, 1997, and their alleged belief that the 1991 Honda Civic was insured on March 19, 1997, is inconsistent with that theory.

I am satisfied that it is more likely than not that Mrs. Budd did advise Mr. Budd that she had transferred the ownership of the car and deleted the vehicle from her insurance policy. In my view, this is consistent with the evidence that the Budds went together to register the vehicle in January 1997, and went together to the Laurentian bank to notarize the necessary forms on March 8, 1997. It is unlikely that from that point, Mrs. Budd would remain strangely silent when she finally concluded their joint plan.

I have already set out my reasons for doubting the credibility of the Budds. I reject their evidence to the effect that Mr. Budd did not know about the transfer of the 1991 Honda Civic and the cancellation of the policy on this vehicle. I am buttressed in this conclusion by my earlier finding that they gave false evidence on the matter of deleting the vehicle from the insurance policy.¹¹

I conclude that on March 19, 1997 Mr. Budd knew that the 1991 Honda Civic had been deleted from Mrs. Budd's policy and that he therefore knew or ought reasonably to have known that he was operating the vehicle while it was not insured. Accordingly, under subsection 30(1)(a) of the Schedule, the Insurer is not required to pay income replacement or non-earner benefits, or benefits under section 20, 21, or 22 of the Schedule to Mr. Budd.

Estoppel Against the Application of Subsection 30(1)(a):

The Applicant's counsel argued that the Insurer should be estopped from relying on subsection 30(1)(a) of the Schedule because of its failure to advise Mr. Budd of its intention to do so, until one year after the motor vehicle accident.

I accept the following definition of estoppel as applicable in this case:

If [Personal], by words or conduct, made a representation to Mr. [Budd] with the intention and the result of inducing him to alter his position in a way that ended up being to his detriment, then it is estopped from arguing a position substantially at odds with its previous representation.¹²

I am satisfied that the information that the 1991 Honda Civic was deleted from the insurance policy effective March 14, 1997 was available and easily discoverable by Personal any time after March 31, 1997. One might reasonably expect Personal to verify all claims to ensure that the information which is subsequently keyed into its computer system is considered.

I conclude that by its silence on this matter, coupled with the payment of benefits, Personal represented to Mr. Budd that the 1991 Honda Civic was insured at the time of the accident.

However, I am not satisfied that Mr. Budd has satisfied the evidentiary onus upon him to demonstrate that he relied on this representation to his detriment. The only step which Mr. Budd has taken (other than accepting benefits, which will be discussed below), was to file a tort action in October 1997 against the driver of the other vehicle involved in the accident. Presumably he has incurred some costs in doing so. But Mr. Budd's counsel conceded that the court action may be continued regardless of my decision, so I am not satisfied that the filing of the action was induced by Personal's silence on the matter of subsection 30(1)(a), or is even to his detriment.

I note as well that estoppel is an equitable doctrine, and the fact that Mr. Budd has not been straightforward about driving without insurance may disentitle him from asserting this equitable doctrine against the Insurer.

2. Repayment of Income Replacement Benefits:

The Insurer seeks repayment under subsection 47(1)(b)¹³ of the Schedule of $6,357.02 in income replacement benefits paid to Mr. Budd since March 1997.

Subsection 47(1)(b) provides for repayment of income replacement benefits from persons who are disqualified from receiving those benefits under Part IX. I have found that Mr. Budd is disqualified from receiving those benefits under Part IX. It follows that Mr. Budd is required to repay the income replacement benefits.

Estoppel Against the Repayment of Income Replacement Benefits:

The Applicant's counsel argued that Mr. Budd was induced to accept the income replacement benefits, by Personal's representation that the 1991 Honda Civic was insured at the time of the accident. He argued that it is to Mr. Budd's detriment to be required to repay these benefits. He argued that Mr. Budd would likely have made alternative arrangements in respect of his financial affairs, had Personal denied benefits at the outset. While I recognize the inherent difficulty faced by any insured in repaying income replacement benefits already spent, the legislation contemplates that insureds must repay benefits under subsection 47, if the insurer gives them notice within 12 months of paying the benefit. While I do not agree with the Insurer's submission that section 47 displaces the equitable doctrine of estoppel, it is incumbent upon Mr. Budd to adduce sufficient evidence of detriment to displace the legislative presumption requiring repayment of income replacement benefits in these circumstances. I heard no evidence from Mr. Budd with respect to any detriment he has suffered by accepting these benefits. Mr. Budd has not satisfied me that the Insurer should be estopped from relying on the repayment provisions of the legislation.

Accordingly, Mr. Budd is required to repay income replacement benefits of $6,357.02.¹⁴

3. Repayment of Other Benefits:

Mr. Budd is also disqualified from receiving section 20 (lost education expenses), section 21 (expenses of visitors) or section 22 (housekeeping and home maintenance) benefits under subsection 30(1)(a). The Insurer is seeking repayment of these benefits¹⁵ under subsection 47(1)(a) of the Schedule on the basis of error, wilful misrepresentation or fraud.¹⁶

However, the Insurer presented no evidence of the amount of benefits, if any, paid under these sections. I find that the Insurer has not satisfied the evidentiary onus of establishing the amount of benefits to be repaid.

Further, I am not satisfied that section 20, 21, and 22 benefits are recoverable in this case. As discussed above, subsection 47(1)(b) addresses repayment of benefits which are paid to insureds who are disqualified under Part IX. This indicates a legislative intention that, although insureds may be disqualified from receiving income replacement, non-earner, section 20, 21, and 22 benefits, they are only obliged to repay certain classes of benefits, (income replacement or non-earner benefits) but not section 20, 21, or 22 benefits.

To find that insureds are nonetheless required to repay section 20, 21, and 22 benefits under section 47(1)(a), simply because those benefits were paid to a person disqualified under Part IX, would render the limitation on repayment in subsection 47(1)(b) redundant.

In my view, in order to obtain repayment of section 20, 21, and 22 benefits under subsection 47(1)(a), the Insurer must establish an error, wilful misrepresentation or fraud, other than the fact that the person was a disqualified driver under Part IX. The evidence before me does not demonstrate any error, wilful misrepresentation or fraud, other than the fact Mr. Budd was a disqualified driver under Part IX. I conclude that Mr. Budd is not required to repay any section 20, 21, or 22 benefits.

EXPENSES:

I have not addressed the issue of expenses in this decision. Counsel may raise this issue with me if they are unable to resolve the matter between themselves.

June 21, 1999

M. Kaye Joachim Arbitrator

Date