Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2005 ONFSCDRS 182

FSCO A05-000305

BETWEEN:

HOA NGOC NGUYEN

Applicant

and

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY

Insurer

DECISION ON INTERIM BENEFITS

Before:

John Wilson

Heard:

December 6, 2005, at the offices of the Financial Services Commission of Ontario in Toronto.

Appearances:

Alan Leibovitch for Mr. Nguyen

Jonathan B. Schrieder for State Farm Mutual Automobile Insurance Company

Issues:

The Applicant, Hoa Ngoc Nguyen, was injured in a motor vehicle accident on September 26, 2003. He applied for statutory accident benefits from State Farm Mutual Automobile Insurance Company ("State Farm"), payable under the Schedule.¹ The parties were unable to resolve their disputes through mediation, and Mr. Nguyen applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

At the pre-hearing of this matter the date for the arbitration hearing was set commencing June 5, 2006 due to the unavailability of counsel for the Insurer. The pre-hearing arbitrator wrote "The applicant's representative asked me to note that he opposed setting dates as late as June."

On October 27, 2005, Mr. Leibovitch filed this motion for interim benefits.

The issues in this hearing are:

1. Is Mr. Nguyen entitled to interim income replacement benefits pending the hearing of his arbitration? The interim benefits claimed by Mr. Nguyen are income replacement benefits at the rate of $376.22 per week and funding for a work-hardening programme.

2. Mr. Nguyen also claimed a special award as an interim benefit.

Result:

1. State Farm shall pay an interim income replacement benefit in the amount of $376.22 per week commencing December 6, 2005 until a date 30 days following completion of the above programme, provided that Mr. Nguyen commences the programme within 30 days of this order, and continues to participate in this programme for its duration.

2. State Farm shall forthwith fund the "work hardening programme" identified in the treatment plan dated October 20, 2004.

3. There will be no interim special award.

4. State Farm shall pay to Mr. Nguyen his fixed expenses in this matter.

EVIDENCE AND ANALYSIS:

Section 279(4.1) of the Insurance Act gives arbitrators a discretionary authority to make interim orders pending the final order in any matter.

Although neither the Insurance Act, the Schedule, nor the Dispute Resolution Practice Code provide any guidance as to the criteria for interim awards, arbitrators have not been shy about enunciating various rules and pre-conditions which frame this arbitral power. Presumably they have drawn from the practice in the courts, including the practice surrounding interim injunctions. According to most arbitrators, an interim order is an exceptional remedy.²They are supposedly not to be a routine part of the accident benefit claims process.³

That there is some jurisprudential confusion concerning the principles to be applied to interim benefits is understandable, since they are unique to the arbitration process, and not dealt with by the courts, except in the context of judicial review. To date there has been no such review.⁴

As has been noted by the Court of Appeal, absent a clear ruling by the courts, there is no rule of stare decisis to keep matters tidy.

(T)here is a well accepted principle of administrative law that stare decisis does not apply to administrative tribunals. A tribunal is not bound to follow its own decisions on similar issues, although it may consider an earlier decision persuasive and find that it is of assistance in deciding the issue before it.⁵

Notwithstanding the best intentions of arbitrators, the result has been a sort of jurisprudential game of broken telephone, with each arbitrator adding his or her own gloss to the bare bones of the statutory provision. Typical of this process has been the addition of the precondition that resort to interim payment orders is limited to cases of merit, need or urgency and where a prima facie case for entitlement has been made out.

In 1996, Arbitrator Allen in Harkness and Economical Mutual Insurance Company⁶ summarized what she considered to be early criteria for interim benefits applications:

...to consider limited issues on a prima facie basis: to affect a limited period of time-often the period between the date of the interlocutory and the final order; and to hear matters where time considerations are a factor. With applications for interim benefits, then, it is understandable why in the interest of speed and urgency the applicant is required to present only a prima facie case for entitlement and to show the urgent nature of the relief sought.

Although at least one arbitrator has opted for an enhanced level of proof in interim benefit matters, it is clear to many that an interim award is a summary matter to be dealt with on limited evidence.⁷

The use of the term "prima facie evidence" is interesting. Prior to the decision of Lord Diplock in American Cyanamid Co. v. Ethicon Ltd.⁸., this was a standard pre-condition to an order for an interlocutory injunction. However, Lord Diplock, in Cyanamid, was of the opinion that an applicant need no longer demonstrate a prima facie case. It was sufficient that the moving party satisfy the court that "the claim is not frivolous or vexatious; in other words that there is a serious issue to be tried."⁹ This test was adopted by the Supreme Court in Manitoba (Attorney General) v. Metropolitan Stores (MTS) Ltd.¹⁰ And re-affirmed in RJR-MacDonald Inc. v. Canada (Attorney-General).¹¹

At the Commission, however, there has continued to be much discussion about what constitutes a prima facie case. Dictionary definitions have been used as guidance. Among then has been Black's Law Dictionary¹² which defined a prima facie case as "a case which has proceeded upon sufficient proof to that stage where it will support finding, if evidence to the contrary is disregarded." Prima facie, then, could be the establishment of a fact in the absence of evidence to the contrary. Some jurisprudence at the Commission has approved of this approach.¹³ Others have gone further and demanded a higher level of proof.

Arbitrators have also examined potential limitations on the scope of interim orders under section 279(4.1) of the Act. Arbitrator Bayefsky in Kolonjari and Co-operators (supra) commented:

In my view, an order of interim benefits is designed to address the personal situation of the applicant in light of a preliminary determination of the merits of the case. It does not set in motion any process with respect to ongoing benefits, particularly when the nature and scope of such benefits can only be determined after a full arbitration hearing.¹⁴

Notwithstanding the common sense approach of decisions such as Kolonjari other arbitrators appeared to be determined to read more of the pre-conditions of injunctive relief into section 279 (4.1). In Kulasekarampillai, Arbitrator Renahan moved the process to its most extreme, stating:

The test the Courts apply on the merits of the case is similar to that expressed by the Arbitrator in Cripps. As well, the factors that the Courts have considered under the criteria of "irreparable harm" and "balance of convenience" are similar to factors arbitrators have considered under the criterion of "urgency."¹⁵

In introducing "irreparable harm" as a pre-condition to interim benefits the arbitrator created a significant hurdle to any application for interim relief, and, ironically one that was in the process of being mitigated in the injunctive process itself. It should be remembered that the Supreme Court itself in RJR downplayed the role of "irreparable harm" as a barrier to relief, stating:

"Irreparable" refers to the nature of the harm suffered rather than its magnitude. It is harm which either cannot be quantified in monetary terms or which cannot be cured, usually because one party cannot collect damages from the other.¹⁶

Curiously, as the hard and fast rules for injunctive relief in the courts eased, interim benefits at the Commission became hedged with narrower and more restrictive rules, which morphed from considerations in making a decision to formal pre-conditions for an order.

The source of all this confused and sometimes contradictory jurisprudence is section 279(4.1) of the Insurance Act, which reads quite simply:

The Director and every arbitrator appointed by the Director may make interim orders, pending the final order in any matter before the Director or arbitrator.

Even setting aside constitutional questions about the power of the legislature to accord equitable jurisdiction to provincially appointed arbitrators, there are significant problems with reading the language of injunctive relief into section 279(4.1). The words doing so are conspicuous in their absence.¹⁷ While there may be practical similarities between the results achieved by an interim order, and those achieved by a court ordered injunction, the roots and parameters of such orders are markedly different.

An injunction is an exercise of the equitable jurisdiction of a superior court. Since a court of equity could only grant specific relief where ordinary substitutional damages would be inadequate, the ordering of an injunction was conditional upon a finding of irreparable harm, which could not be addressed in damages. Without such a finding the dispute was solely within the jurisdiction of the common law courts, and a court of equity was powerless to act.

By way of contrast, an interim award owes its basis to statute. Like a special award (section 282 (10)), it is a remedy that is specific to the arbitration process. Provided that an application for arbitration has been made, and an arbitrator appointed to hear the issues in dispute, the arbitrator is permitted by statute to make an award pending the final disposition of the matter. There is no statutory pre-condition other than the existence of an arbitration, the appointment of an arbitrator and presumably, the willingness of the arbitrator to exercise his or her jurisdiction.

As noted earlier, there is no reference in section 279(4.1) to the provision of injunctive relief or granting the power to use such equitable remedies.¹⁸ Rather, the section permits arbitrators to make interim orders. The statute, however, does not define what is meant by an "interim order."¹⁹

By way of contrast, section 101 of the Courts of Justice Act, referring to the power to grant injunctions, uses the terms "interlocutory injunction or mandatory order" (injonction interlocutoire ou ordonnance de faire interlocutoire), terms which are conspicuously absent from section 279(4.1) of the Insurance Act.

Ruth Sullivan in Driedger²⁰ commented "Given the presumption of consistent expression it is possible to infer an intended difference in meaning from the use of different words or a different form of expression. She further observed that "the presumption of consistent expression applies not only within statutes but across statutes as well."

From the framework and wording of section 279(4.1) of the Insurance Act it is difficult to discern any evidence that the legislature intended either to grant to arbitrators the power to grant injunctions, or that the power to make interim awards should be framed by the same restrictions and limitations as those which apply to injunctive relief in the Superior Court.

Rather than importing different legal concepts from other legislation, if further understanding of the meaning is necessary, it should be looked for in the statute itself, and, more specifically, in the provisions creating statutory accident benefits to which arbitration at the Commission owes its genesis. This is the approach that the Supreme Court has mandated in the Bell ExpressVu case. Citing Driedger the court stated:

"Today there is only one principle or approach, namely, the words of an act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the act, the object of the act, and the intention of Parliament." Driedger's modern approach has been repeatedly cited by this court as the preferred approach to statutory interpretation across a wide range of interpreted settings ... I note as well that in the federal legislative context, this court's preferred approach is buttressed by s. 12 of the Interpretation Act, R.S.C. 1985, c.I-21,²¹ which provides that every enactment "is deemed remedial, and shall be given such fair, large and liberal construction and interpretation as best ensures the attainment of its objects."²²

What then are the objects of the statutory accident benefits scheme set out in the Insurance Act? Many courts, judges and arbitrators have examined this question.

Eberhard J., in Gill v. Zurich, 1999 CanLII 36826 (ON SC), [1999] O.J. No. 4333 at p.14, made the following comments on the purposes of the statutory accident benefit scheme:

I adopt the statement of purpose articulated by Arbitrator Mackintosh at page 12 in Edgar v. Wellington Insurance Co. [1994] O.I.C.D. No. 34 File A-005441 that SABS is remedial, that is to be interpreted in a broad and liberal way, and that its principal object is to provide a "fair and adequate income stream to those who are injured and disabled from work". The victim is to receive an approximation of wages, and not be compensated more or less.

Likewise Cameron J. in Youden v. Economical characterized the purpose of the accident benefit legislation has been as follows:

This is remedial legislation. The "no fault" legislation deprived the plaintiff of his common law right to sue for damages²³ for loss of income due to another's negligence. The Regulation provides for prompt payment of an income benefit to replace income lost due to the accident without need to prove fault and in lieu of any amount the plaintiff might have been awarded and recovered at common law.²⁴

Gonthier J., in Smith v. Co-operators General Insurance Co., speaking in connection with an accident benefit matter, stated:

There is no dispute that one of the main objectives of insurance law is consumer protection, particularly in the field of automobile and home insurance.²⁵

If then, the "scheme of the act, the object of the act, and the intention of Parliament" is the creation of a legislative scheme that provides consumer protection and that allows for the provision of "prompt payment of an income benefit to replace income lost due to the accident", as well as to "provide a fair and adequate income stream to those who are injured and disabled from work", then an arbitrator may make an interim order in a matter before him or her where the arbitrator is satisfied that such an order will advance such purposes.

Obviously the process of making such an interim decision is subject to the normal rights of the parties to present evidence in support of their positions and to make submissions as to the proper decision for an arbitrator to make in the circumstances. An arbitrator has a wide discretion to make orders, but he or she must make a decision judicially on the evidence before him or her.

Although the question of legislative purpose has been addressed before in interim benefit matters, the results have not always been consistent with the analysis in Bell ExpressVu.

The fact that the main objectives of insurance law is consumer protection does not change the fact that, where an insurer denies payment, a claimant must prove his case on a balance of probabilities. And, in my opinion, if he wants an interim order, he must satisfy a higher standard of proof as well as establish irreparable harm and that the balance of convenience is in his favour.²⁶

Thus, In the view of at least one arbitrator, the words of section 279(4.1) are not to be read liberally.

Once again, a comparison to the practice in the courts provides a useful reality test. Even in the ordering of injunctions, the courts no longer demand clear pre-conditions to relief. Justice Sharpe in Injunctions and Specific Performance,²⁷ wrote:

The checklist of factors which the courts have developed-relative strength of case, irreparable harm and balance of convenience-shall not be employed as a series of independent hurdles. They should be seen in the nature of evidence relevant to the central issue of assessing the relative risk of harm to the parties from granting or withholding interlocutory relief.

Thus, if one criteria for relief such as irreparable harm, or balance of convenience is not clearly met, the court should still consider all the relevant evidence before accepting or rejecting a request for injunctive relief. Given that Equity, the Courts of Justice Act, and the Rules of Civil Procedure set a higher bar for injunctive relief than an interim order under section 279.4.1, it is difficult to understand such insistence on barriers to access, let alone the reference to a "a higher standard of proof."

In deciding whether or not the "prompt payment" of benefits should be ordered by way of an interim order under section 279(4.1), an arbitrator has discretion to consider many different factors. Some of these have already been addressed in arbitral jurisprudence.

It is perhaps useful to re-examine some of the criteria suggested by Arbitrator Manji in Ioannidis²⁸ which has frequently been cited as a useful analysis of the interim order issue. In addition to the element of "prima facie case" which I have dealt with separately, Arbitrator Manji identified other concerns to be addressed.

1. The existence of an element of necessity or urgency

Since an "interim" order is "occurring for an intervening time", the timing of an application for such an order in the context of the relief requested ought to be of some importance. This relates to the consumer protection mandate and the goal of "prompt payment" and providing a "fair and adequate income stream" to accident victims. If the hearing is some time distant, and the need is present, an interim order may well be appropriate. There is no evidence however that it should be a rigid pre-condition to an order.

2. A blatant disregard by the insurer of the Schedule or Act.²⁹

In addition to being a contractual provision of every motor vehicle insurance policy, accident benefits are social policy contained in a legislative format. No one, insurer or insured, has the right to derogate from these provisions. This reflects the "consumer protection" aspect of the Schedule. The Supreme Court in Smith has set a high standard for the performance of an insurer's obligations under the Schedule - a standard that has not been weakened by the Court of Appeal in Turner³⁰ A failure to abide by the Schedule should have its consequences.

3. An interim order is subject to the final order and an arbitrator may order interim benefits be repaid.

This draws directly from the plain meaning of "interim benefits" and the intent of the legislation.

4. Subsection 279(4.1) of the Act does not change the onus of proof. The onus of proof remains the insured person's.

A decision, interim or otherwise, must be based on a procedure that respects fairness, and on the balance of the evidence before the arbitrator.

Arbitrator Manji and others have also discussed at length whether the existence of a "prima facie case "should be a prerequisite for an interim order. She concluded it was. While some analysis of the claimant's case is necessary to the process of adjudication, I am not satisfied that any case can be made for such a specific pre-condition to an order.

As noted earlier, there is no such specific limitation contained in the legislation. While I accept that an arbitrator should make a decision based on the evidence as to entitlement before him or her at the interim benefit hearing, it is clear that the use of prima facie as a threshold to benefits is an importation from earlier injunctive jurisprudence, and has no basis in law in this forum as a bar to interim relief.

Given the widely varied interpretations it has received by arbitrators, it is clear that prima facie adds little precision to the process of evaluation.

On a practical basis an arbitrator would be unlikely to make a preliminary order in a case where the claim was frivolous and had no chance of success. However, as a formal pre-condition to the granting of an interim order, a rigid concept such as prima facie case is both difficult to apply and unjustified in law.

As discussed earlier, even if one is determined to import the prerequisites of equity and injunctive relief into interim arbitration awards, the use of the prima facie test is not justified. Since American Cyanamid it has been clear that the test, in the case of injunctions at least, has been replaced by the concept of "a serious issue to be tried."

Given the wide discretion granted to arbitrators under section 279(4.1) of the Insurance Act, it may be wise to remember Lord Denning's comments on the exercise of such discretion, made only a few short years prior to the Cyanamid case:

the right course for a judge is to look at the whole case. He must have regard not only for the strength of the claim but also the strength of the defence, and then decide what is best to be done...the remedy by interlocutory injunction is so useful that it should be kept flexible and discretionary. It must not be made the subject of strict rules.³¹

Especially given the current legislative amendments removing DACS from the accident benefit system in Ontario, which has the consequential effect of removing the right of an insured to have benefits continued pending a DAC report, or continued pending resolution of the dispute pursuant to section 37(5) of the current Schedule, it is important not to unduly or unnecessarily diminish the scope or effectiveness of interim orders.

Following Lord Denning's admonition the important thing is to "look at the whole case." In this matter, the whole case before me consists of the motion record, filed by Mr. Leibovitch, and documents entered as exhibits by both sides. The Applicant's motion record included an affidavit by Mr. Nguyen. Mr. Nguyen did not appear to provide viva voce testimony. Nor had the Insurer provided any notice to Mr. Nguyen that his presence was required for cross-examination.

Prior to the commencement of the hearing I questioned counsel for the Insurer whether Mr. Nguyen's presence was required for cross-examination, and mentioned that an adjournment could be obtained if necessary to permit his attendance. Mr. Schrieder advised that he was content to proceed on the documentary record together with oral submissions. In this context, I note the comments of J.W. Quinn J. in Bliss v. Van Egmond³² that "Although a court is not obliged to accept uncontradicted sworn evidence (whether given orally or by affidavit), where that evidence is not inherently improbable the failure to cross-examine invites its acceptance."

As with any claim for benefits, the onus is on the applicant to convince the arbitrator that an interim award of benefits is appropriate in the situation. Likewise, as with any other case, an arbitrator must decide on the basis of the evidence before him or her having "regard not only for the strength of the claim but also the strength of the defence."³³

In a motion for interim benefits, the evidence, as in this case, will be primarily documentary, including affidavit material, and other documentary evidence filed by the parties. Given the early stage in the process at which a motion may be brought, and the need for a summary disposition, this is appropriate.³⁴ As noted earlier, due to the nature of the motion, and its timing, the evidence provided may be incomplete or on a summary basis. Each party, however, as in a motion for summary dismissal, would be expected to have put their best foot forward, and fairly presented their best case at the time of the motion.

Mr. Nguyen's statutory declaration is not extensive. In fact, it consists of seven statements and has no trouble fitting in a single page format. Essentially, Mr. Nguyen states that he was involved in a motor vehicle accident, suffered injuries, continues to suffer specified disabilities arising from the accident, and although formerly financially responsible within his family, is now subject to the support of others, his standard of living having "plummeted to a point of extreme despair."

At the motion hearing, counsel for the Insurer tried to challenge the credibility of Mr. Nguyen's statements in his statutory declaration. Mr. Schrieder essentially claimed that the statements were empty recitals of unproven assertions that I should not accept as credible evidence in support of interim benefits. In this aspect of the case, the decision of Mr. Schrieder to neither cross-examine nor to accept an adjournment to allow for Mr. Nguyen's presence may have been a serious tactical error, since certain criteria have long been applied to the impeachment of a witness’s credibility, whether that evidence be admitted viva voce or by way of affidavit.

The Court of Appeal in O'Brien v. Shantz [1998] O.J. No. 4072 has reaffirmed the application of these same criteria contained in the rule in Browne v. Dunn in Ontario. The court noted:

(The) general principle (is) that a party wishing to impeach the credibility of a witness must ordinarily put the contradictory material to the witness in order to give the witness an opportunity to explain it. This principle, at bottom, a principle of fairness is reflected in the House of Lords decision in Browne v. Dunn (1893) 6 R. (H.L.) And in ss. 20 and 21 of our Evidence Act.

I do not accept that Mr. Nguyen's statutory declaration is "inherently improbable" and on its face, unworthy of belief. Nor do I accept that the Insurer "put the contradictory material to the witness in order to give the witness an opportunity to explain it." Consequently, I accept Mr. Nguyen’s statutory declaration as some credible evidence of Mr. Nguyen’s entitlement.

While the brevity of Mr. Nguyen's own evidence might raise questions about whether he has raised sufficient credible evidence to convince me, on the balance of probabilities that he is entitled to interim benefits, the affidavit evidence is not the sum total of his case. He has also included medical documentation, including a psychological report from Dr. H. Van der Spuy, dated October 12, 2005, which supports an intervening work hardening programme before any return to work.

Mr. Nguyen also relied upon Dr. Nemeth's report, contained in a psychological I.E. performed on behalf of the Insurer. While Dr. Nemeth initially opined that "Mr. Nguyen is substantially able to return to pre-accident activity levels, including occupational duties as well as housekeeping", his opinion was tempered by his comments that "from a psychological perspective a gradual return to work is recommended in order to maximize success at returning to this."

Mr. Leibovitch's theory of entitlement is essentially this: Mr. Nguyen's rehabilitation had progressed to a point where he was almost fit to return to his own work. He applied for a work-hardening programme to assist him in making the transition to being able to perform the essential tasks of his pre-accident employment. In the absence of such a treatment, and due to the failure of the Insurer to fund it, he failed to complete his return to employability. Indeed, as noted by Dr. Van der Spuy, "his present limbo status is absolutely demoralizing and devastating to his self-esteem and psychological well-being."

Looking to the "the strength of the defence", I find that the materials filed by State Farm do not really address the theory of the claim for interim benefits identified by Mr. Leibovitch. The report by Drs. Malcolm and Nemeth has been referred to above. The clinical summary written by David Corey refers to a recognition of an adjustment disorder, a substantial ability to return to pre-accident activities, and the recommendation for a "gradual return to work." There is no unequivocal statement that Mr. Nguyen was able to successfully undertake the essential tasks of his pre-accident employment without some intervening step.

The Work Able DAC performed by Dr. Koepfler, dated September 26, 2003, although addressing the reasonableness of further treatment, noted that the main "problems appear to be resolving spontaneously" and spoke of his admission that he was "virtually recovered." Dr. Koepfler makes no finding that the problems have resolved, only that they are well on the way to resolving. This is not inconsistent with the position taken by Mr. Nguyen at this hearing.

Likewise, I do not find the conclusions of Dr. Guerriero concerning the proposed treatment plan to be determinative of the issues. His report speaks only to musculo-skeletal assessments, a restriction that is repeated throughout the report. He do acknowledge some physical sequelae but downgrades their importance. Given the psychological context of the recommendations for a work transition programme, his finding that "there is no residual physical impairment resulting from the motor vehicle accident" is not highly probative, especially since his report is not designed to address the criteria for income replacement benefits.

Given Mr. Nguyen's uncontradicted affidavit evidence, and the medical documents filed by both sides, I find, on the balance of the evidence put before me, that he has made out the basic elements of the test for income replacement benefits contained in the Schedule and has demonstrated that a workplace reintegration programme such as he has proposed would be not only useful, but reasonable and necessary to get him back to work in a timely manner.

I note that the Insurer's medical reports are consistent with Mr. Leibovitch's theory of this case, and do not indicate an unequivocal opinion with regard to Mr. Nguyen's ability to fully undertake his job requirements in an efficient manner at the time of the examination. Rather, as in the case of Dr. Nemeth's recommendations, there appears to be a projection into the future of Mr. Nguyen's capacity to return to work, conditional to a degree on intervening events, without a later final report confirming that the projections were in fact correct.

I also note that the fact that the hearing date is later than provided for in the Commission's policy and that the later date was chosen over the objections of Mr. Nguyen, based on the availability of counsel for the Insurer, militates in favour of interim relief.³⁵

To the extent that need must be addressed, there is a psychological opinion presented, that together with Nguyen's uncontradicted evidence, shows a prospect of deterioration if Mr. Nguyen remains in his unemployed "limbo", as well, of course, as his own, again uncontradicted, evidence of financial distress.

In sum, Mr. Nguyen has presented his request for interim relief in a timely manner, not long after the pre-hearing in this matter. He has requested a training programme that he, and his advising professionals believe will possibly enable him to return to work promptly and successfully. The programme will potentially mitigate the Insurer's need to provide ongoing income replacement benefits by getting Mr. Nguyen back to productive work. He has provided evidence that the award of benefits at this stage in the proceedings could be of great assistance to him, mitigate potentially serious consequences of delay, and encourage a timely return to work. This request clearly fits with the goals of the statutory accident benefits legislation, and I see no strong arguments from the Insurer to persuade me that I should decline to exercise my discretion to make an order pending final resolution of this matter.

I accept that, based on the balance of the evidence before me, Mr. Nguyen has made out a case for interim benefits.

I also note that, if I am incorrect in my identification of the criteria for an award of interim benefits, I make the following findings. Mr. Nguyen's case, based on the evidence before me, would have met at least the requirement of "prima facie' case for entitlement. I also find that there was uncontradicted evidence of urgency, both financial and psychological, and evidence that a further delay in providing the work-hardening programme would have had consequences that would not have easily been addressed by monetary damages, or the ultimate provision of the benefit.

Given Mr. Leibovitch's presentation of this case as one where an insured had almost reached the level of employability, but was stymied by the unwillingness of the insurer to agree to a transitional programme, I order ongoing income replacement benefits from the date of the hearing of this motion to a date 30 days after the completion of the work-hardening or re-integration programme proposed by Mr. Nguyen. The Insurer shall also fund the programme which has been claimed by Mr. Nguyen in this motion.

The award of interim income replacement benefits is contingent upon Mr. Nguyen commencing the programme within 30 days of the date of this decision and remaining engaged in the programme until its completion.

Should the programme not yield the expected results for Mr. Nguyen, and should he be unable to return to work following its completion, I remain seised of this matter, and will deal with any delays or timing problems as well as any motion to extend the interim benefits, provided that such is brought in a timely manner, before the expiry of the current benefits. Mr. Nguyen has also requested an interim special award in this matter. Without commenting on the grounds for such an order at this point, I believe that it is best left to the hearing arbitrator who will have access to more complete evidence on the reasonableness of the position that the Insurer has taken with regard to the non-payment of benefits. I see no compelling reason for dealing with it at this time.

EXPENSES:

Given Mr. Nguyen’s success in this matter, he shall have his expenses of the motion. If the parties are unable to agree on a quantum of expenses, I may be spoken to on that issue providing the request is made within 30 days of this decision.

December 22, 2005

John Wilson Arbitrator

Date

Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2005 ONFSCDRS 182

FSCO A05-000305

BETWEEN:

HOA NGOC NGUYEN

Applicant

and

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY

Insurer

INTERIM ARBITRATION ORDER

Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:

1. State Farm shall pay an interim income replacement benefit in the amount of $376.22 per week commencing December 6, 2005 until a date 30 days following completion of the above programme, provided that Mr. Nguyen commences the programme within 30 days of this order, and continues to participate in this programme for its duration.

2. State Farm shall forthwith fund the "work hardening programme" identified in the treatment plan dated October 20, 2004.

3. There will be no interim special award.

4. State Farm shall pay to Mr. Nguyen his fixed expenses in this matter.

December 22, 2005

John Wilson Arbitrator

Date

Footnotes

1. 1The Statutory Accident Benefits Schedule —Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.
2. 2Arbitrator Alves in Coutu and Wawanesa Mutual Insurance Company (OIC A97-001916, June 5, 1998) at page 14, noted that: "this is a discretionary power to be exercised in appropriate circumstances, not granted routinely."
3. 3Presumably the characterization of interim benefits as "exceptional" draws from the use of the permissive "may" instead of the mandatory "shall." However the use of the same language in s. 282(10) relating to orders for expenses has not prevented costs orders from being granted "routinely."
4. 4Some interim benefit cases have been considered on other issues - see Brown v. Allstate 1998 CanLII 18877 (ON CTGD), [1998] O.J. No. 2318
5. 5TransCanada Pipelines Ltd. v. Beardmore (Township), The Queen in Right of Ontario v. TransCanada Pipelines Ltd. et al, reported 2000 CanLII 5713 (ON CA), 186 D.L.R. (4th) 403 Ont. C.A.
6. 6(OIC A96-001420, December 10, 1996)
7. 7See Kolonjari and Co-operators General Insurance Company, *FSCO A97-002059, November 18, 1998)
8. 8American Cyanamid Co. v. Ethicon Ltd. 1975 CanLII 2598 (FC), [1975] A.C. 396
9. 9American Cyanamid (supra)
10. 10Manitoba (Attorney General) v. Metropolitan Stores (MTS) Ltd. 1987 CanLII 79 (SCC), [1987] 1 S.C.R. 110
11. 11RJR-MacDonald Inc. v. Canada (Attorney-General) 1994 CanLII 117 (SCC), [1994] 1 S.C.R. 311
12. 12West Publishing Company, St. Paul, Minn., 1968
13. 13see Cripps and Axa Insurance (Canada) (OIC A-013360, August 8, 1997)
14. 14Kolonjari and Co-operators (supra) at page 13
15. 15Kulasekarampillai and State Farm Mutual Automobile Insurance Company (FSCO A03-001063 January 21, 2004)
16. 16RJR (supra)
17. 17The same terminology is used in the context of family law. Interim relief under the Divorce Act or the Family Law Act is aimed at stabilizing the economic position of closely related parties pending final resolution of all issues. It is of some note that statutory accident benefits are "first party" and arguably entail a higher level of obligation between parties than the more common third-party claims.
18. 18Contrast this to the powers granted to the Saskatchewan Labour Relations Board in 1994 to grant both injunctive and interim remedies (S.S. 1994 c.47) and the accompanying Practice Note No. 1, dated November 22, 1994 which specifically imports the standards set by the courts in such matters.
19. 19Black's Law Dictionary, 8^th Edition, defines "interim" as "Done, made, or occurring for an intervening time; temporary or provisional..."
20. 20Driedger on the Construction of Statutes 3d. Edition Ruth Sullivan, Toronto 1994.
21. 21In this case, see The Interpretation Act, R.S.O. 1990 c. I 11
22. 22Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 42, [2002] 2 S.C.R. 559
23. 23Even though the right to claim under tort for certain damages has been restored, there are still restrictions and a large deductible that keeps Cameron J.'s comments relevant.
24. 24Youden v. Economical Insurance Co. 1996 CanLII 8010 (ON CTGD), [1996] O.J. No. 2044.
25. 25Smith v. Co-operators General Insurance Co. [2002] S.C.R. 129
26. 26Kulasekarampillai and. State Farm Mutual Automobile Insurance Company (supra)
27. 27(2^nd ed.: 1992; Canada Law Book).
28. 28loannidis and Canadian General (OIC A97-001551, December 15, 1997)
29. 29I would, however, question the use of "blatant" as a qualifier. Certainly an instance of non-compliance that is neither trivial nor "flagrant or unashamed" can have significant consequences for an insurer's position, as was the case in Smith.
30. 30Turner v. State Farm - The Court of Appeal made it clear that the test to be applied to an insurer's notice was "clear and unequivocal" not substantial compliance, as it upheld the Director's Delegate in the application of the higher test.
31. 31Hubbard v. Vosper [1972] 2 Q.B. 84.
32. 32Bliss v. Van Egmond 2004 CanLII 48876 (ON SC), [2004] O.J. No. 5200
33. 33Hubbard v. Vosper (supra)
34. 34Reference again may be had to practice in family law matters where significant issues may be decided on the basis of affidavit evidence only.
35. 35See Blum and Aviva Canada Inc. (FSCO A02-001375, June 9, 2004) concerning the expected timelines of the arbitration process. Thus, according to the Practice Code, an insured may reasonably expect a ruling on benefit entitlements in less than a year from the commencement of the arbitration process. This application dates from February 9, 2005.