Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2004 ONFSCDRS 117

Appeal P03-00020

OFFICE OF THE DIRECTOR OF ARBITRATIONS

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY

Appellant

and

THI YEN TRAN

Respondent

Before:

David Evans

Representatives:

John P. Desjardins for State Farm

David F. Longley for Ms. Tran

Hearing Date:

March 22, 2004

Written submissions completed by March 25, 2004

APPEAL ORDER

Under section 283 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:

1. The appeal is dismissed, and the arbitration decision, dated May 15, 2003, is confirmed.

2. The parties may contact me within 30 days if they are unable to agree on appeal expenses.

August 12, 2004

David Evans

Director’s Delegate

Date

REASONS FOR DECISION

I. NATURE OF THE APPEAL

Ms. Thi Yen Tran applied to State Farm Mutual Automobile Insurance Company (“State Farm”) under the SABS–1996,¹ claiming accident benefits as a result of a motor vehicle accident on June 7, 2001. State Farm initially paid benefits but then alleged that the accident was staged and refused to pay more. State Farm appeals the Arbitrator’s finding that Ms. Tran was involved in a motor vehicle accident.

The parties agreed at the start of the hearing that, if the Arbitrator found there was an accident, they would be able to resolve the other issues between them.

II. BACKGROUND

State Farm’s position at the arbitration hearing was that the accident could not have happened as described by Ms. Tran. Its witnesses were Mr. Scott Walters, an expert in forensic engineering and accident reconstruction, and Ms. Sonia Crooks, owner of the other vehicle involved in the accident.

Ms. Tran testified that on the evening of June 7, 2001, she was driving her car, a Volkswagen Passat, and had a passenger, Ms. Hoa Kim Tri. Ms. Tran turned right (that is, north) onto Scarlett Road in Toronto from St. Clair Avenue West. She was northbound on Scarlett in the left lane and approaching the right-angled or T-intersection with Ellins Avenue. (Ellins runs east from Scarlett.) She estimated her speed was about 50 kilometers an hour when the left side of her car hit the passenger side of another car – a 1989 Toyota Corolla owned by Ms. Sonia Crooks. The Corolla had been southbound on Scarlett and turned left in front of Ms. Tran. She did not see the Corolla before impact, and only braked after impact. Both cars came to rest facing in the same northbound direction.

Mr. Walters wrote an Engineering Assessment of the accident. In his report and his testimony, he expressed the opinion that although the Passat and the Corolla had collided at some point, the accident could not have happened as described. For instance, the Corolla’s damage was consistent, not with a 50 km/h at 90 degrees to the side of the car, but rather with a low-speed (7 to 12 km/h) acute-angled side-swipe, like “the Volkswagen sideswiping the Toyota or the Volkswagen making a sharp right turn in too close of a proximity to the Toyota and contacting it while the Toyota was stopped.”²

The Arbitrator appeared to agree that the accident could not have occurred as described by Ms. Tran, as she accepted that Ms. Tran may not have been entirely accurate in her recollection of the speed at which she was traveling or the mechanics of the accident. She nonetheless did not accept it was a staged accident, noting that Ms. Tran’s memory of the events may have been “affected by the lapse of time or the traumatic nature of the incident.” She added: “It is not surprising that, as a participant in a car accident, she does not have a specific recollection of every detail concerning the accident.”³

State Farm argued at the arbitration that Ms. Tran colluded in a staged accident as part of a conspiracy in which Ms. Crooks was also engaged.

Although Ms. Crooks initially told State Farm she was the driver of the other vehicle in the accident, the Corolla, she testified at the hearing that this was false. She testified that she had given the keys of her car to a “Sophie,” who was going to arrange a “fictitious accident.” Ms. Crooks later retrieved her car from Sophie at a nearby auto body shop, where Sophie gave her Ms. Tran’s insurance and driver’s license information. Armed with that information, Ms. Crooks proceeded to a collision reporting centre and completed her collision report.

Ms. Crooks also testified that she saw Ms. Tran’s damaged Passat at that auto body shop at the same time she was picking up her car, but she did not know and did not see Ms. Tran.

Ms. Tran testified that after the accident, she obtained Ms. Crooks’ insurance and driver’s licence information from the other driver. She then left the scene of the accident,⁴ drove first to her home to pick up her son, and then went with him to a different collision reporting centre, where with his assistance and that of a police officer she prepared her collision report.

The Arbitrator concluded that there was no evidence before her to suggest that Ms. Tran knew Ms. Crooks or the driver of Ms. Crooks’ car, or conspired with either of them to stage an accident.

III. ANALYSIS

The Arbitrator’s ruling turned on her factual findings. Appeals are limited to questions of law.⁵ A finding of fact constitutes an error of law only if it was made in a complete absence of evidence to support it, on the basis of conjecture, or based on a misapprehension of the evidence that is caused by a misdirection on a legal principle.⁶

Ms. Tran submits that State Farm has pointed to no such errors and that it simply wants me to reassess the evidence, which is not my role.

State Farm submits that the Arbitrator committed an error of law by failing to properly acknowledge and apply the expert’s evidence, and that she reached an unsupported conclusion that Ms. Tran’s memory of the accident was affected by the lapse of time or the traumatic nature of the incident. It further submits that the Arbitrator committed an error of law by ignoring evidence pointing to a staged accident, namely the post-accident exchange of particulars and presence of Ms. Tran’s Passat at the auto body shop.

A. Accident Reconstruction

Before dealing further with the accident, State Farm submits on appeal that Ms. Crooks testified that the accident did not occur. That is not a fair reading of her evidence, which taken as a whole shows that Ms. Crooks could neither confirm nor deny that the accident occurred.

State Farm submits that there was no evidence to support the Arbitrator’s finding that “Ms. Tran’s memory of the events may be affected by the lapse of time or the traumatic nature of the incident.” It also submits that this finding contradicted the Arbitrator’s earlier one that “Ms. Tran’s testimony concerning the mechanics of the accident are consistent with her contemporaneous report at the collision reporting centre.”

With respect to the consistency of the testimony with the report, the collision report simply indicates a straight-on collision with no indication of swerving or braking, which is consistent with the testimony.

Although it is sparse, I find there is some evidence to support the Arbitrator’s finding that the lapse of time and the trauma of the accident affected Ms. Tran’s understanding of it. When asked if she tried to steer her car at the time of impact, Ms. Tran replied, “I was shocked, I couldn’t recall.” Also, when asked if she could tell whether her car came to rest facing to the right, she replied, “I cannot recall exactly because by that time, I was so shocked.”⁷ The Arbitrator implicitly accepted this evidence, and it was within her authority to do so.

State Farm submitted that there was no evidence to support the Arbitrator’s findings with respect to the effect of the lapse of time or the nature of the incident. However, as the Director’s Delegate in Lombardi stated:

The line between a conclusion that there was “no evidence” to support a finding, and a mere “insufficiency of evidence” will often be difficult to discern. This case is a prime example. However, it is a vital distinction. In the first case, the error is properly characterized as an error of law, and hence reviewable. In the second, it is no more than an error of fact, that is not reviewable.

I find that there was evidence to support the Arbitrator’s findings on these points, although the Insurer may consider it insufficient. Ms. Tran’s testimony shows that the accident happened so suddenly that she did not have time to brake, and by the time she came to a stop, she was too shocked to know exactly which way her vehicle was pointing. This supports the Arbitrator’s conclusion that “[i]t is not surprising that, as a participant in a car accident, [Ms. Tran] does not have a specific recollection of every detail concerning the accident.”

Ms. Tran had the initial advantage in proving there was an accident, in that Mr. Walters agreed that her vehicle and the Corolla collided at some point. However, it appears that the Arbitrator agreed with the expert that the accident could not have happened as Ms. Tran suggested. That shifted the tactical onus back to Ms. Tran. In response, her counsel then suggested a variation of the accident to Mr. Walters, who acknowledged that, theoretically, Ms. Crooks’ car may have nearly completed a u-turn in front of Ms. Tran’s car at the time of impact. This would account for the Corolla’s damage being consistent with a side-swipe. However, he added that there would have been no time for the u-turn to be completed, given Ms. Tran’s evidence that she was driving at approximately 50km/h.

It would have been preferable for the Arbitrator to deal explicitly with this last point. Instead, she mentioned it but did not deal with it further. I believe Mr. Walters’ evidence deserved further discussion, especially in light of his testimony about the impossibility of a u-turn resulting in the damage observed. However, as counsel for Ms. Tran also brought out from Mr. Walters, Ms. Tran could have been mistaken about her speed. Mr. Walters also testified that what mattered was the relative speed between the Toyota and the Volkswagen: “If the Toyota were traveling at, say, 30 kilometers per hour, then the Volkswagen would be travelling at 37 to 42 kilometers per hour.”⁸

Furthermore, Mr. Walters’ report is only as good as the information he had. In preparing his analysis, he relied on Ms. Crooks’ information, but in fact she knew nothing about the accident. There is no reliable information from her about the direction or speed of either car. That throws half of Mr. Walters’ equation into doubt. As for Ms. Tran, she only knew that the Corolla came from the left, could not estimate its speed, and was confused about the mechanics of the accident. Finally, I believe the Arbitrator implicitly took notice that participants in accidents have difficulty in recalling the mechanics of the accident, especially with respect to matters such as speed and direction, as was her right.⁹ Considering these many variables that affected the validity of Mr. Walters’ report, I do not find that the Arbitrator “failed to properly acknowledge the evidence of Scott Walters and to apply it at the arbitration hearing. . . .”¹⁰

B. Collusion

The Arbitrator wrote that there was no evidence before her to suggest that Ms. Tran knew Ms. Crooks or the driver of Ms. Crooks’ car, or conspired with either of them to stage an accident.

State Farm submits that the Arbitrator ignored evidence the accident was staged – namely, the exchange of license and insurance information between Ms. Tran and the other driver after the accident and the presence of the two cars at the auto body shop that same evening before the attendances at the collision reporting centres.

First, State Farm points to the passages in the Arbitrator’s decision where she states that Sophie took Ms. Crooks’ driver’s license and insurance information when she picked up the Corolla and that someone using Ms. Crooks’ driver’s license had been driving her car that evening.

State Farm correctly points out that all Ms. Crooks stated was “I gave my keys to a girl by the name of Sophie. . . .”¹¹ It submits that the “crucial finding of fact” that someone was using Ms. Crooks’ driver’s license was not based on any evidence before the Arbitrator and that the Arbitrator “could and should have concluded that Thi Yen Tran was not telling the truth when she testified that she observed the driver’s license of Sonia Crooks at the scene of the accident.”¹²

Although the Arbitrator may have drawn an erroneous inference that Sophie had Ms. Crooks’ license and insurance information, Ms. Crooks’ evidence still does not give State Farm the evidence of a staged accident. Ms. Crooks did not state that “I gave only my keys to a girl by the name of Sophie.” She simply did not testify about where, when or how she gave the insurance and license information to Sophie, or how Sophie passed it on to Ms. Tran.

Second, State Farm submits that:

[T]he evidence of Sonia Crooks that she saw the vehicle of Ms. Tran afterwards at a bodyshop or garage, when combined with her evidence that [Sophie] was involved in a conspiracy to stage a motor vehicle accident, was sufficient evidence on which the Arbitrator could and should have concluded that Thi Yen Tran was also involved in a conspiracy to stage a motor vehicle accident.¹³

Ms. Tran testified that she talked with the other driver and then was the first to leave the scene of the accident. However, she was not directly asked if she went to the body shop before going to the collision reporting centre. In any event, I can only conclude that the Arbitrator implicitly rejected Ms. Crooks’ evidence on this point. Ms. Crooks was an admitted liar, so her evidence was not credible. By way of contrast, the Arbitrator found that “[o]n all material points, Ms. Tran was consistent in her testimony and was not significantly undermined in cross examination.”

I find the Arbitrator committed no error of law in finding no evidence that Ms. Tran participated in a conspiracy to stage an accident.

The appeal is dismissed, and the arbitration decision, dated May 15, 2003, is confirmed.

IV. EXPENSES

The parties may contact me within 30 days if they are unable to agree on appeal expenses.

August 12, 2004

David Evans

Director’s Delegate

Date

Footnotes

1. 1The Statutory Accident Benefits Schedule – Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.
2. 2Walters report, Arbitration Exhibit 2, Tab D, p. 5.
3. 3Arbitration decision, p. 6.
4. 4Ms. Tran testified that her passenger, Ms. Tri, only drove a few feet with her and then insisted on being let out.
5. 5Insurance Act, s. 283(1).
6. 6Lombardi and State Farm Mutual Automobile Insurance Company, (FSCO P01-00022, February 26, 2003).
7. 7Arbitration transcript of Ms. Tran, questions 76 and 165.
8. 8Arbitration Transcript of Mr. Walters 33:2-4.
9. 9Statutory Powers Procedure Act, s. 16.
10. 10Appellant’s Submissions, para. 24.
11. 11Arbitration transcript of Ms. Crooks 3:16-17.
12. 12Insurer’s Written Submissions, para. 12.
13. 13Insurer’s Written Submissions, para. 11.