Neutral Citation: 2001 ONFSCDRS 15
FSCO A99-001201
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
MARY K. SHADD
Applicant
and
LIBERTY MUTUAL INSURANCE COMPANY
Insurer
DECISION ON A PRELIMINARY ISSUE
Before:
Joyce Miller
Heard:
Written submissions were received from both parties by November 24, 2000.
Appearances:
James E. S. Allin for Ms. Shadd
Jim Tomlinson for Liberty Mutual Insurance Company
Issues:
The issues in this preliminary issue hearing are:
How should item 4 of the settlement agreement of April 16, 1998, which provided that the Insurer shall pay Ms. Shadd her expenses for housekeeping and a shop assistant, be interpreted?
Can Ms. Shadd claim rehabilitation benefits for the cost of a shop assistant as set out above in addition to loss of earning capacity benefits under section 20 of the Schedule?
Result:
Item 4 of the settlement agreement of April 16, 1998 is interpreted to include the provisions that ongoing payment of expenses for housekeeping and a shop assistant by Liberty Mutual is conditional on Ms. Shadd's continuing entitlement for these benefits and the reasonable verification of entitlement in accordance with the Schedule. Also, implicit in item 4 is Ms. Shadd's entitlement to dispute any termination of the benefits in accordance with the Schedule, as well as the requirement that Ms. Shadd provide written verification of the expenses for which she is seeking reimbursement.
Issue number 2 and the issue of a special award raised in Ms. Shadd's submissions are left to the hearing arbitrator.
BACKGROUND:
The Applicant, Mary K. Shadd, was injured in a motor vehicle accident on January 15, 1994. She was paid accident benefits by Prudential of America General Insurance Company, (hereinafter referred to as the "Insurer") payable under the Schedule.1 Her benefits were later terminated and a dispute arose over Ms. Shadd's entitlement to ongoing benefits. Ms. Shadd applied for mediation, which failed, and then she applied for arbitration. An arbitration hearing was scheduled for April 20 to 24, 1998.
Several days before the scheduled hearing the parties entered into a settlement. The terms of the settlement were confirmed by Mr. J. Allin, counsel for Ms. Shadd, by letter dated April 16, 1998 to the Insurer's counsel. The terms were as follows:
Your client will pay to my client the sum of $5,900.00 on account of arrears for income replacement benefits up to May 1, 1998.
Your client will continue to pay income replacement benefits to my client at the rate of $130.06 per week from May 1, 1998 and continuing during the lost earning capacity DAC process hereinafter referred to.
We have agreed that your client will arrange and my client will submit to a lost earning capacity DAC in London, Ontario. The DAC will be directed to examine both my client’s pre-accident and post-accident income earning capacity. At the conclusion of the DAC, we have agreed that the regulations with respect to lost earning capacity will apply to my client’s claim.
Your client will pay to my client her costs of having assistance and attendant care at her shop. As well, your client will continue to pay for the cost of housekeeping assistance at my client’s home. I have agreed to provide to you written verification in possession of my client dealing with the arrears of expense insofar as the assistant at her work is concerned. I will pass this documentation along to you as soon as I receive it.
Finally, we have agreed that your client will reimburse to my client her expenses associated with the arbitration proceedings pursuant to the Dispute Resolution Code.
The Insurer subsequently disputed the validity of the agreement. Specifically, the Insurer claimed that the settlement was invalid and not binding because it had failed to deliver to Ms. Shadd the required notice under the Regulation. The Insurer further claimed that Ms. Shadd was mistaken in her interpretation that item 5 of the settlement agreement meant that the Insurer would reimburse her for her legal expenses associated with the arbitration proceeding. As well, the Insurer claimed that because the settlement did not specify the amount that the Insurer was to pay for expenses, it was void for uncertainty.
An arbitration hearing was held on August 27, 1998. Arbitrator Baltman found that the settlement agreement entered into by the parties on April 16, 1998 was a binding settlement agreement. She found that item 5 was neither vague or uncertain, nor was there a mistake that would void the agreement. As well, she held that the Insurer could not rely on its own failure to comply with the Regulation as a means to invalidate the settlement.
In addition to finding that there was a settlement agreement, the Arbitrator awarded Ms. Shadd a special award of $7,500 inclusive of interest. In giving her reasons as to why a special award was being made, the Arbitrator stated:
In this case the Insurer refused to implement the settlement agreement on the basis that the parties were mistaken about its terms or, alternatively, that its terms were uncertain. Not only is there no merit to the Insurer's position, but I find that Prudential, through its counsel, engaged in a wishful reconstruction of what had occurred. It disregarded the very straightforward correspondence that clearly spelt out the terms of the settlement, and instead raised spurious arguments or twisted Mr. Allin's correspondence out of context in order to revise its agreement with Ms. Shadd. To compound matters, it ignored numerous phone calls and letters from Mr. Allin, who was desperately trying to get funds to his client.
This conduct also undermines the very important goal of dispute resolution. When parties arrive at a settlement within the context of one of the Commission's processes, they are expected to comply fully and promptly with the terms of the agreement.
The Arbitrator's decision was issued on October 2, 1998. The decision was not appealed.
On November 9, 1998, Ms. Shadd's counsel wrote to Liberty Mutual (Prudential of America General Insurance Company was taken over by Liberty Mutual Insurance Company, hereinafter referred to as "Liberty Mutual") and requested payment in the amount of $8,601.13 for the expense of a shop assistant as per the settlement agreement. On November 24, 1998, Liberty Mutual sent her counsel a letter stating that it would be necessary for Liberty Mutual’s accountant to assess these expenses. On December 2, 1998, at the request of Liberty Mutual, Ms. Shadd participated in an occupational therapy assessment.
On December 16, 1998, Ms. Shadd's counsel wrote to Liberty Mutual claiming $11,086.42 for the expenses that were agreed upon in item 4 of the settlement agreement. On December 23, 1998, Liberty Mutual wrote to her counsel and stated that it would not pay for the shop assistant expense beyond April 28, 1998. In January 1999 there was further correspondence with respect to the payment of a shop assistant.
On May 10, 1999, Ms. Shadd's counsel sent Liberty Mutual further receipts for the expense of a shop assistant and housekeeping to Liberty Mutual. On May 18, 1999, Liberty Mutual advised Ms. Shadd's counsel that effective December 23, 1998, Liberty Mutual would not pay any more housekeeping expenses. As well, Liberty Mutual advised that effective January 30, 1999, it would stop paying expenses for the shop assistant.
On June 21, 1999, Ms. Shadd applied for mediation which was held on December 10, 1999. It failed. On December 16, 1999, Ms. Shadd applied for arbitration. A pre-hearing was held on June 14, 2000 and the following issues were identified: the quantum of Ms. Shadd's LEC benefit pursuant to section 20 of the Schedule; entitlement to rehabilitation benefits for a shop assistant from July 1998 onward, pursuant to paragraph 40(5)(a) of the Schedule; housekeeping and home maintenance services from July 1998 onward, pursuant to section 55 of the Schedule; as well as a special award, and legal expenses claimed by both parties.
On June 26, 2000, Liberty Mutual brought an application in the Ontario Superior Court of Justice requesting that a judge grant a declaration regarding the interpretation of item 4 of the settlement agreement. On June 27, 2000, Mr. Justice Donnelly dismissed Liberty Mutual's application on the basis of the rule of multiplicity of proceedings and subsection 280(1) of the Insurance Act. He stated the proper forum to hear this matter would be through the arbitration process.
The pre-hearing discussion was initially held on June 14, 2000 and was resumed on July 4, 2000 and July 6, 2000 before a new pre-hearing arbitrator. In her letter of August 15, 2000, the pre-hearing arbitrator set out three issues to be heard as preliminary issues prior to the arbitration hearing scheduled to commence on January 22, 2001. These issues were identified as follows:
Does item 4 of Mr. Allin's letter of April 16, 1998 constitute a settlement of the issue of Ms. Shadd's entitlement to rehabilitation benefits to compensate her for the cost of a shop assistant from July 1998 onward, pursuant to paragraph 40(5)(a) of the Schedule?
Does item 4 of the letter referred to above also constitute a settlement of the issue of Ms. Shadd’s entitlement to payments for housekeeping and home maintenance services from July 1998 onward, pursuant to section 55 of the Schedule?
Can Ms. Shadd claim rehabilitation benefits for the cost of a shop assistant as set out above in addition to loss of earning capacity benefits under section 20 of the Schedule?
In its submissions for this preliminary issue hearing, Liberty Mutual conceded that the parties had in fact entered into a settlement agreement on April 16, 1998. However, it submitted that there is an issue in dispute and that is: How should item 4 of the agreement be interpreted?
SUBMISSIONS:
Ms. Shadd's Submissions:
Ms. Shadd submits that she suffered a serious brain injury in the car accident. She submits that her brain injury is permanent and she will not recover from the effects of this injury. She submits that the brain injury impairs her cognition and that she has difficulty in organizing ordinary daily activities at home and at work, and for this reason she needs an assistant both at home and at work.
Ms. Shadd submits that the injury is permanent and that accordingly, her entitlement is permanent. As regards to the amount of benefits, she does not see it as a "blank cheque," but that the limits are contained within the standard policy and that these limits define the extent of her claim.2
Ms. Shadd submits that prior to the Insurer's first challenge of the settlement agreement the Insurer had sought clarification of item 4 of the agreement. Ms. Shadd submits that the day after the agreed settlement of April 16, 1998, counsel for the Insurer wrote to her counsel seeking clarification of term. The Insurer was concerned why Ms. Shadd would require both a shop assistant and attendant care. Ms. Shadd submitted that her counsel confirmed that same day that only one shop assistant was contemplated by the settlement. This appears to have been the only concern that the Insurer had with respect to item 4.
Ms. Shadd submits that the essence of the order that Liberty Mutual now seeks to raise, once again, is the issue of Ms. Shadd's eligibility for the benefits in question. It is the position of Ms. Shadd that the issue of eligibility has been determined once and for all in the settlement agreement which was confirmed in Arbitrator Baltman's decision of October 2, 1998. Ms. Shadd submits that Liberty Mutual is not permitted to re-litigate that issue.
Ms. Shadd submits that when the Insurer first challenged the settlement agreement at the hearing held on August 27, 1998, the Insurer took the position that the terms of the settlement in items 1 through 4 were acceptable and agreed to, and that it was only challenging item 5. Ms. Shadd submitted that the Insurer's position is confirmed on page 6 of Arbitrator Baltman's decision of October 2, 1998 where she states that: "[t]he parties have since resolved all of the terms of the settlement save one: Prudential insists that it never agreed to pay Ms. Shadd's legal fees."
Ms. Shadd submits that the doctrine of issue estoppel and res judicata should apply in this case. Ms. Shadd submitted the issue as to whether there was a settlement in this case and, in particular whether there was a settlement of item 4, has been litigated and a decision had been issued on this matter.
Ms. Shadd requests that an order be made that Liberty Mutual immediately comply with the settlement agreement to pay her expenses for ongoing housekeeping and a shop assistant. In addition, Ms. Shadd submits that a special award should be made against Liberty Mutual for not only evading the implementation of the terms of the settlement agreement, but also for not complying with Arbitrator Baltman's decision of October 2, 1998.
Ms. Shadd submits that from the time of the settlement, the Insurer considered the settlement unfavourable to itself. Ms. Shadd submits that the Insurer has set out on an intentional and deliberate course of conduct to flout the terms of the settlement agreement.
In support of her position, Ms. Shadd presented a "true copy" of the first page of Tab 159 of Liberty Mutual's productions which the latter was ordered to disclose at the pre-hearing. The item was identified by Liberty Mutual as: "Handwritten notes to file, author unknown (two pages) undated."
Ms. Shadd pointed out that in the middle of page 159, the words "we caved in!" was noted along with the terms of the settlement agreement including the words "cont' H.K." and "pay support in shop as rehab." Ms. Shadd submits that I should infer that these notes were made by the adjuster at the time of the settlement agreement and that the comment "we caved in!" characterizes the attitude of the adjuster towards the settlement.
Ms. Shadd submits that there was nothing in the settlement agreement that would allow the Insurer to unilaterally terminate her expenses for housekeeping and a shop assistant. Ms. Shadd pointed out that if Liberty Mutual felt that there was an ongoing need for verification on entitlement for these expenses, it could have easily included a requirement in the settlement that Ms. Shadd submit to a disability DAC or a med/rehab DAC.
Ms. Shadd submits that although it was not a term of the settlement to require her to verify her expenses by way of producing written documentation, nevertheless, she has consistently provided full written verification of all the expenses that she has claimed for a shop assistant and housekeeping assistance.
Liberty Mutual's Submissions:
Liberty Mutual submits that it does not dispute that the parties entered into a settlement agreement on April 16, 1998. Nor does it dispute that the terms of that agreement are substantially" reflected in Mr. Allin's letter dated April 16, 1998. Liberty Mutual, however, submits that what is in dispute is how item 4 of the agreement should be interpreted.
Liberty Mutual submits that the parties have different interpretations regarding item 4 of the settlement letter. Liberty Mutual submits that when it originally challenged the settlement agreement, the only issue in dispute at that time was the meaning of the word "expenses" in item 5. It submits that it was only after it terminated Ms. Shadd's housekeeping benefits effective December 23, 1998 that a dispute arose regarding the interpretation of item 4 of the settlement letter. Liberty Mutual submits that when it terminated the housekeeping benefits it became apparent that Ms. Shadd also had a different interpretation of that part of the settlement. Liberty Mutual submits that this issue could not have been raised before the arbitrator at the hearing on August 27, 1998, because it had not, at that point, become a dispute between the parties.
Liberty Mutual submits that the issues in dispute at the August 27, 1998 arbitration hearing were whether a settlement agreement had been reached on April 16, 1998, and if so, how the term expenses" in item 5 of the settlement letter should be interpreted. Liberty Mutual submits that neither of these issues are in dispute in this hearing.
Liberty Mutual submits that because the interpretation of item 4 of the settlement agreement was not an issue addressed by the arbitrator, then the doctrines of issue estoppel and res judicata are not applicable to this situation. Liberty Mutual states that these judicial concepts only apply to situations in which a prior ruling or decision has been rendered on the very issue that is being raised in a second forum.
Liberty Mutual submits that item 4 of the April 16, 1998 settlement letter is "ambiguous" since it does not contain the conditions, if any, by which Liberty Mutual's obligation to fund housekeeping and shop assistant expenses may be limited in time.
Liberty Mutual points out that in item 3 of the settlement letter the parties expressly recognized that the Insurer was entitled to have Ms. Shadd attend a DAC for the purpose of assessing her residual earning capacity. Liberty Mutual submits that this reflects an awareness of the rights available to the Insurer to test and verify claims and an intention to rely upon those rights. Given this agreement to have Ms. Shadd's vocational prospects assessed, Liberty Mutual submits that the parties should not be taken to have agreed at the time of the settlement that Ms. Shadd would require housekeeping and shop assistance for the remainder of her life.
Liberty Mutual submits that it is unstated but implicit in item 4 of the settlement agreement that Ms. Shadd could lose her entitlement to a shop assistant and housekeeping assistance if she, at some point, ceased to meet the eligibility criteria in the SABS. Specifically, Liberty Mutual submits that Ms. Shadd might no longer require the shop assistant because her loss in income is being compensated through LECBs or she may no longer medically require the assistance as a result of the accident.
Liberty Mutual submits that it would be unreasonable to conclude that it agreed to fund the shop assistant and housekeeping indefinitely without regard to continuing entitlement. Referring to the case of the City of Toronto v. W.H. Hotel Limited, 1966 CanLII 8 (SCC), [1966] S.C.R. 434 at 440, Liberty Mutual submits that contractual terms should be interpreted so as to give efficacy to the agreement and in such a way as to avoid interpretations resulting in a commercial absurdity. Liberty Mutual submits that settlement agreements should, likewise, be interpreted so as to give a reasonable effect to their purpose as determined from the context of negotiations and to avoid an untenable result.
Liberty Mutual submits that section 65 of the SABS makes it apparent that in the normal course an insurer would expect to be able to verify an insured's medical condition for vocational disabilities. Under that section, an insurer may, as often as is reasonably necessary, require that an insured be examined by a medical professional or an expert in vocational rehabilitation. Liberty Mutual submits that this statutory scheme would have been in the contemplation of both parties at the time of the negotiations. Therefore, neither party could reasonably have believed that Liberty Mutual was agreeing to provide housekeeping and shop assistance without regard to entitlement and continuing verification.
Liberty Mutual submits that the purpose of the agreement, as is apparent from the surrounding factual context, was to settle the outstanding arrears of expenses, to acknowledge Ms. Shadd's entitlement to housekeeping assistance and a shop assistant as of April 16, 1998 and to permit the parties to move on to consider her long-term prospects for rehabilitation and vocational development.
Liberty Mutual submits that the agreement to provide Ms. Shadd with a shop assistant and housekeeping assistance is implicitly conditional on her continuing entitlement to this assistance.
Liberty Mutual submits that it only terminated Ms. Shadd's housekeeping benefits because it received an occupational therapy report that concluded that these benefits were no longer medically necessary. Liberty also submits that it only terminated the shop assistant benefit because Ms. Shadd's LECB payment had begun and that it provided complete indemnification for the lost earnings Ms. Shadd was suffering as a result of the accident.
Liberty Mutual submits that another term of the settlement agreement which is also implicit is that Ms. Shadd be required to provide written verification of expenses for which she is seeking reimbursement. Liberty Mutual submits that it would result in a commercially unreasonable interpretation of the settlement agreement if Ms. Shadd would not be required to provide verifying documents in relation to the expenses being claimed. Liberty Mutual submitted that an objective observer would not reasonably have believed that counsel for Liberty Mutual would agree to write Ms. Shadd what amounts to a blank cheque.
Liberty Mutual, however, does acknowledge that Ms. Shadd has regularly complied with Liberty Mutual's request for written verification with respect to all expenses for which she claimed reimbursement.
Without providing any supporting objective evidence, Liberty Mutual submits that it now knows the name of the person who wrote the note at page 159 of its productions and when it was written. Liberty Mutual submits that the words "we caved in" in the note does not indicate that Liberty Mutual felt taken advantage of or that it intended to renege on the settlement agreement reached. Instead, in Liberty Mutual’s view, these words indicate that Liberty Mutual agreed to compromise on its position regarding IRBs in order to reach a negotiated settlement with Ms. Shadd and to move on to an assessment of her lost earning capacity and long-term prospects.
In summary, Liberty Mutual asks that an order be made that in the settlement agreement dated April 16, 1998, it agreed to pay Ms. Shadd's past reasonable expenses incurred for a shop assistant until April 20, 1998 and to continue thereafter subject to Ms. Shadd's continuing entitlement under the Insurance Act and under Regulation 776/93; that it agreed to pay Ms. Shadd her past reasonable expenses incurred for housekeeping assistance until April 20, 1998 and to continue payment thereafter subject to Ms. Shadd's continuing entitlement under the Insurance Act and Regulation 776/93; and that by the terms of the settlement agreement, Ms. Shadd agreed to provide Liberty Mutual with written documentation verifying any reasonable expenses related to her housekeeping and shop assistant benefit.
ANALYSIS AND FINDINGS:
In its submissions, Liberty Mutual concedes that there is no dispute as to whether the parties entered into a binding settlement agreement on April 16, 1998. I agree. What is at issue, however, is the interpretation of item 4 of the settlement agreement.
Succinctly, the issue is whether the Insurer agreed in the April 16, 1998 settlement to fund
Ms. Shadd's shop assistant and housekeeping expenses indefinitely, or whether the funding was subject to continuing entitlement and reasonable verification on the part of the Insurer. I agree with Liberty Mutual that this issue was not dealt with in the arbitration hearing of August 27, 1998. Accordingly, I find that the doctrines of issue estoppel and res judicata do not apply and I have jurisdiction to deal with this issue.
I agree with Liberty Mutual’s submissions that item 4 of the settlement letter is ambiguous. It is not clear whether Ms. Shadd is to be paid her expenses for ongoing housekeeping and a shop assistant for life without any verification on the part of Liberty Mutual or whether Liberty Mutual is entitled to verify her continuing entitlement. I agree with Liberty Mutual that certain terms must be implied in order to give effect to the scope and nature of the agreement.
In his text on Contract Law3 Fridman states:
The law has long recognized that it is not always possible to confine the terms of a contract, whether written, oral or partly written and partly oral, to those which have been expressly stipulated between the parties. There are circumstances in which a court is entitled to conclude that everything agreed by the parties is not contained in the written document or documents, or the oral statements of the parties, that appear to make up the contract. Some additional term or terms must be implied.
Fridman goes on to state that what is required is something more than what a court might think is reasonable. The court must seek to discover what the parties intended; at page 475 he states:
While, ... the courts are not anxious to go beyond the letter of the written word, where the contract is expressed in writing, unless there is some strong justification, such as patent, internal ambiguity in the language employed by the parties, nonetheless, there are circumstances in which it is clear law that, at the invitation of one of the parties in the course of litigation, a court is entitled to conclude that everything that was agreed between the parties is not contained in the written document or documents that make up the contract, and that it is possible and justifiable to import or imply in the contract some additional term or terms, in order to establish the nature and scope of the contractual obligations binding the respective parties. Naturally, this is not something which the courts will do easily or cavalierly. There has to be strong evidence to support the conclusion that the implication of a term is permissible in the circumstances.
Summarizing the case law, Fridman articulates three main instances when this may be done:
(i) when it is reasonably necessary, having regard to the surrounding circumstances, and in particular the previous course of dealing between the parties, if any;
(ii) when there is an operative trade or business usage or custom that may be said to govern the relationship of the parties; and
(iii) when some statute of its own motion implies a term into the kind of contract that is in question.
Applying the first and third criteria articulated by Fridman, I find that, having regard to the surrounding circumstances and the requirements of the Schedule, it is reasonably necessary to infer that the parties intended that ongoing payment of expenses, for housekeeping and a shop assistant, by Liberty Mutual would be conditional on Ms. Shadd's continuing entitlement to these benefits.
In this case, the settlement entered into on April 16, 1998 dealt with accident benefits to be paid pursuant to the Schedule by the Insurer to Ms. Shadd for expenses she incurred as a result of her car accident. The settlement letter of April 16, 1998 reflects the fact that the settlement was negotiated within the context of the statutory scheme outlined in the Schedule. For example, in item 3 of the settlement letter, the parties agreed that pursuant to the statutory regulations the Insurer has a right to test and verify Ms. Shadd's claim regarding a residual earning capacity. This, in my view, reflects an awareness by the parties of the rights available to the insurer in the Schedule and the intention to rely upon those rights.
Given that section 65 of the Schedule allows for an insurer to verify an insured's medical condition for vocational disabilities, I find that it is reasonable to infer that Liberty Mutual’s agreement to fund the expenses for a shop assistant and housekeeping was subject to
Ms. Shadd's continuing entitlement to these accident benefits. Implicit in this is that Liberty Mutual would, in a reasonable manner, and in accordance with the criteria of the Schedule, be entitled to verify Ms. Shadd's medical condition to determine if she was still eligible for these accident benefits. Also implicit in item 4 is that if Liberty Mutual terminated Ms. Shadd's expenses for housekeeping and a shop assistant, she could dispute this termination in accordance with the Schedule. This in fact is what has happened and an arbitration hearing on the substantive issues regarding ongoing payment of these expenses is scheduled to be held on June 25, 2001.
Although Liberty Mutual acknowledges that Ms. Shadd has regularly complied with Liberty Mutual’s request for written verification with respect to all expenses for which she claimed reimbursement, I, nevertheless, find Liberty Mutual’s submission that an implicit term of the settlement agreement requires Ms. Shadd to provide written verification of expenses for which she is seeking reimbursement to be reasonably necessary.
In conclusion, I find that item 4 implicitly provides that ongoing payment of expenses, for housekeeping and a shop assistant, by Liberty Mutual is conditional on Ms. Shadd's continuing entitlement for these benefits and the reasonable verification of entitlement pursuant to the statutory regulations. Also, implicit in item 4 is that Ms. Shadd is required to provide written verification of the expenses for which she is seeking reimbursement, as well as Ms. Shadd's entitlement to dispute any termination of her benefits.
The second issue in this hearing is whether Ms. Shadd can claim rehabilitation benefits for the cost of a shop assistant as set out in the settlement agreement of April 16, 1998 in addition to LEC benefits under section 20 of the Schedule. According to the pre-hearing letter, the Insurer had asked that this issue be included in the preliminary issue hearing. However, I was not provided with any evidence on this issue that would enable me to make a decision in this particular case.
This is a difficult issue to answer in an abstract manner and in isolation from the full hearing which would hear all the relevant evidence in this particular case. I could speculate in the abstract
whether or not in certain circumstances rehabilitation benefits for the cost of a shop assistant could be paid in addition to LEC benefits. However, it is best left to a full hearing of the evidence which would allow the hearing arbitrator to come to a better-informed decision based on the particular facts of this case.
SPECIAL AWARD:
Pursuant to subsection 282(10) of the Insurance Act Ms. Shadd claims a special award. This was not set down as an issue for this preliminary issue hearing. However, in her submissions Ms. Shadd presented a number of submissions on this issue. In my view this issue should be left to the discretion of the hearing arbitrator who will have the benefit of hearing all of the evidence.
EXPENSES:
The issue of expenses of this preliminary issue hearing is left to the discretion of the hearing arbitrator.
February 9, 2001
Joyce Miller
Arbitrator
Date
FSCO A99-001201
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
MARY K. SHADD
Applicant
and
LIBERTY MUTUAL INSURANCE COMPANY
Insurer
ARBITRATION ORDER
Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
- Item 4 of the settlement agreement of April 16, 1998 is interpreted to include the provisions that ongoing payment of expenses, for housekeeping and a shop assistant by Liberty Mutual is conditional on Ms. Shadd's continuing entitlement for these benefits and the reasonable verification of entitlement by Liberty Mutual in accordance with the Schedule. Also, implicit in item 4 is Ms. Shadd's entitlement to dispute any termination of the benefits in accordance with the Schedule, as well as the requirement that Ms. Shadd provide written verification of the expenses for which she is seeking reimbursement.
February 9, 2001
Joyce Miller
Arbitrator
Date
Footnotes
- The 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, 463/96 and 304/98. O.R. 776/93 was extensively modified by O.R. 781/94; accordingly, where necessary, "1994 Schedule" refers to the original O.R. 776/93, and "1995 Schedule" refers to O.R. 776/93 as amended.
- Subsection 46(1) of Schedule provides that: The total of all benefits paid under Parts VII and VIII in respect of an insured person shall not exceed $1,000,000 in respect of any one accident.
- H.L. Fridman, The Law of Contracts in Canada, (third edition) 1994 at pp. 474ff.