Neutral Citation: 2002 ONFSCDRS 150
FSCO A01-000333
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
LORNA HOWDEN
Applicant
and
PEMBRIDGE INSURANCE COMPANY (PAFCO INS. CO.)
Insurer
DECISION ON A MOTION
Before:
John Wilson
Heard:
By written submissions at the Financial Services Commission of Ontario in Toronto.
Appearances:
David S. Wilson for Ms. Howden
Grant R. Dow for Pembridge Insurance Company (Pafco Ins. Co.)
Issues:
The Applicant, Lorna Howden, was injured in a motor vehicle accident on October 5, 1998. A hearing was held at the Financial Services Commission which stretched over several dates in the fall of 2001 and the winter of 2002, concluding, ultimately, with written submissions in April of 2002.
Following the conclusion of the evidence and the submissions, but prior to the issuance of the decision, Mr. David Wilson, counsel for Ms. Howden, wrote to the Commission, requesting that the hearing be reopened to permit the presentation of further evidence and submissions. Mr. Wilson based his request upon the recent release of the decision of the Supreme Court of Canada in the case of Smith v. Cooperators 2002 SCC 30, [2002] S.C.J. No. 34. In his written submissions Mr. Wilson interpreted the above decision as giving rise to an obligation "...where an insurer has not given a proper refusal, the insurer is obliged to continue to pay benefits regardless of the merits of the insured's claim."
Counsel for the Insurer, Grant Dow opposed Mr. Wilson's request to reopen this matter.
The issue before me on this motion is whether Ms. Howden will be allowed to reopen this case to present fresh evidence and submissions, relative to matters arising from the decisions of the Supreme Court of Canada in the Smith decision.
Result:
- Ms. Howden is not permitted to reopen this case to adduce fresh evidence, nor is counsel given leave to make further submissions in this matter.
ANALYSIS:
Rule 43 of the Practice Code provides for the reopening of a hearing. Subrule 43.1 states:
The arbitrator may reopen a hearing at any time before he or she makes a final order disposing of the arbitration.
The rule is permissive, not mandatory, and creates a discretion for an arbitrator to reopen a case, as long as the final order in the matter has not been issued.
In addition to the rule, there has been some significant jurisprudence, both at the Commission and in the courts concerning the circumstances in which this discretion should be exercised.
Arbitrator Manji, in Tran and Pilot Insurance Company (OIC A- 005207, August 16, 1995), dealt directly with the requirements to reopen a hearing. After finding that an arbitrator has full control of the post-hearing process and that it is within the arbitrator's discretion whether or not to receive further evidence, Arbitrator Manji concluded:
I believe that an arbitrator should exercise his or her discretion to receive further evidence after the case is closed only in exceptional or extraordinary circumstances. To do otherwise would be to delay and jeopardize the arbitration process and the finality required in the process.
The arbitrator further outlined some of the criteria for a decision to reopen a hearing.
...even where the evidence is relevant it may be refused when it is offered after the case is closed. In my view, before an arbitrator exercises his or her discretion to receive further evidence, he or she must be satisfied that not only is the evidence relevant but it is also so weighty that if adduced it would have an important influence on the result of the case. It must also be shown that the lateness of its preparation was justified by unusual circumstances beyond the control of the party
The criteria defined by Arbitrator Manji are reminiscent of the criteria for the introduction of new evidence on appeal in the court system. The Court of Appeal may hear evidence on appeal in civil cases, in special circumstances. Likewise, appeal courts in criminal matters may hear new evidence pursuant to section 610(1) (d) of the Criminal Code. Although the wording of the provisions and the precise legal basis for the introduction of new evidence may differ in the criminal sphere from practice at the Commission, the discussion of these issues is relevant to practice at this tribunal.
The Supreme Court in R. v. Palmer, 1979 CanLII 8 (SCC), [1980] 1 S.C.R. 759, summarized the criteria for the admission of new evidence. McIntyre J., in delivering the judgement of the court developed the following principles:
(1) The evidence should generally not be admitted if, by due diligence, it could have been adduced at trial provided that this general principle will not be applied as strictly in a criminal case as in civil cases...
(2) The evidence must be relevant in the sense that it bears upon a decisive or potentially decisive issue in the trial.
(3) The evidence must be relevant in the sense that it is reasonably capable of belief, and
(4) It must be such that if believed it could reasonably, when taken with the other evidence adduced at trial, be expected to have affected the result.
As noted earlier, the Palmer criteria resemble closely those applied by the Commission.
David Wilson, counsel for Ms. Howden , submitted that such limitations on reopening are unduly restrictive. In effect, they adopt standards more appropriate for an appellate level than a tribunal of first instance. According to Mr. Wilson, the criteria for a reopening at first instance, before a decision is rendered, should be much less rigorous.
There is some court jurisprudence that supports Mr. Wilson’s contention that an adjudicator at first instance has a wider discretion to reopen than at appeal.
For example, in the case of Castlerigg Investments Inc. v. Lam (1991) 1991 CanLII 7355 (ON CTGD), 2 O.R. (3d) 216, Jane J. held that, where a judge was not functus, it was not necessary to demonstrate that the new evidence asked to be submitted was not available before trial, or could not have been obtained by due diligence. Instead Lane J. focussed on the question of whether a miscarriage of justice would occur without the evidence.
This approach contrasts sharply with Estey J.A.'s decision in Becker Milk Co. Ltd. et al. v. Consumer’s Gas Co. (1974), 1974 CanLII 545 (ON CA), 2 O.R. (2d) 554 in which he dealt with a similar situation.
There is no question that until judgement was issued, the learned trial judge in his discretion could have admitted further evidence if he were satisfied that the matters in question had come to the knowledge of a party after the trial, could not with reasonable diligence have been discovered sooner, and, if the evidence, as is the case here, were of such a character that it might probably have altered the judgement about to be given: Commercial Life Assurance Co. v. Williamson et al. (No. 2), 1943 CanLII 451 (AB SCTD), [1943] 2 W.W.R. 103.
It should be noted that all of these cases are based on proceedings subject to the Rules of Civil Procedure, not by the Dispute Resolution Practice Code. Although there are certain similarities between practice at the Commission, and in the courts, the two forums differ in their approaches to some matters.
Arbitration at the Commission is designed to be, to quote the introduction to the Code, "quicker, less expensive and less formal." Given the goals of the arbitration process, it is understandable why the Commission has developed the criteria identified in Tran (supra). To create a fair process that works within reasonable time constraints, parties must be encouraged to put forward their best case at the hearing, and not be tempted to add to it piecemeal in accordance with the vagaries of the arbitration process.
I find that, although there is a discretion in arbitrators to reopen cases before they are functus, that discretion is properly defined by the principles outlined by Arbitrator Manji in Tran.
In this matter, the issues which the Applicant wishes to raise arise from the issuance of the Supreme Court decision in Smith v. Cooperators (supra). Although the case deals specifically with a limitations defence, Mr. Wilson draws a further inference from the decision that is not shared by Mr. Dow or the Insurer.
According to Mr. Wilson, the case also stands for the proposition that a failure to properly terminate benefits by the Insurer creates, in itself, a entitlement to ongoing benefits for an insured, that is not dependent on the merits of an insured’s situation. As Gonthier J. noted at the beginning of the Smith decision:
This case involves questions of statutory interpretation in the context of limitation periods in Ontario Insurance Law.
He proceeded to summarize the issues in the case:
The general issue raised by this appeal is whether the insurer fulfilled its obligation under s. 71 of the Statutory Accident Benefits Schedule- Accidents after December 31, 1993, and before November 1, 1996, O. Reg. 776/93 ("SABS) to inform the insured of the procedures for resolving disputes set out in ss. 279 to 283 of the Insurance Act R.S.O. 1990, c. I. 8. This will determine whether there was a proper refusal by the respondent to continue payment of the benefits so as to trigger the limitation period of two years to launch a civil action.
I accept Gonthier J.’s characterization of the issues in Smith.
While the Smith decision reinforces the need for insurers to diligently carry out their duties to properly and fully inform an insured upon the termination of benefits, I do not accept that the court makes any finding that specifically creates an independent entitlement to benefits as a consequence for non-compliance.
In any event, it would appear that the Applicant has not previously raised this issue at either mediation or pre-hearings. The Insurer, consequently, has presented its entire case without being aware that it would be required to speak to another issue. The present motion, is not merely to adduce further evidence relevant to the issues at the hearing, but, fundamentally, to add a further issue to a hearing that has already taken place.
Whatever the merits of the procedural entitlement argument, I see no reason why the timing of such an issue needed to be dependent upon the release of Smith. Mr. Wilson could have raised the issue earlier, and so given some notice to the Insurer.
Reopening a matter in which all the evidence had been heard already, to permit the introduction of an entirely new issue could result in serious prejudice to other parties. In fairness, it might be necessary for witnesses who have already testified to be recalled to deal effectively with this new issue. Consequently, further delay, repetition of testimony, and extra expense for both parties would be anticipated if this hearing were to be reopened.
In addition, I am not persuaded that the Smith decision is more than tangentially relevant to the issues in this arbitration. Nor do I believe that the information, if provided, would alter the outcome of the hearing.
I find that counsel for the Applicant has failed to meet his onus of demonstrating that there are the exceptional or extraordinary circumstances present, as identified in Tran, that would justify the exercise of my discretion to reopen this matter.
I find, as well, that, even if the principles outlined in Castlerigg were applied, the greater injustice would arise from the reopening of this matter, and the concomitant necessity, to recall witnesses and re-hear much of the case. I therefore, decline to reopen this matter.
EXPENSES:
I make no order as to expenses, which may be dealt with as part of the expenses of the overall hearing in this matter.
September 23, 2002
John Wilson Arbitrator
Date
Neutral Citation: 2002 ONFSCDRS 150
FSCO A01-000333
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
LORNA HOWDEN
Applicant
and
PEMBRIDGE INSURANCE COMPANY (PAFCO INS. CO.)
Insurer
ARBITRATION ORDER
Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
- Ms. Howden is not permitted to reopen this case to adduce fresh evidence, nor is counsel given leave to make further submissions in this matter.
September 23, 2002
John Wilson Arbitrator
Date