Gary Stephenson v. Economical Mutual Insurance Company, 2007 ONFSCDRS 239

Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2007 ONFSCDRS 239

Appeal P07-00001

OFFICE OF THE DIRECTOR OF ARBITRATIONS

GARY STEPHENSON

Appellant

and

ECONOMICAL MUTUAL INSURANCE COMPANY

Respondent

BEFORE:

David R. Draper

REPRESENTATIVES:

Laurie Tucker for Mr. Stephenson

Pasquale Peloso and Katie Gauthier for Economical

HEARING DATE:

November 7, 2007

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 arbitrator’s order, dated December 13, 2006, is confirmed.

2. If the parties are unable to agree about expenses of this appeal, a hearing may be arranged in accordance with Rule 79 of the Dispute Resolution Practice Code.

December 4, 2007

David R. Draper Director of Arbitrations

Date

REASONS FOR DECISION

I. NATURE OF THE APPEAL

In a decision dated December 13, 2006, the arbitrator dismissed Mr. Stephenson’s claim for accident benefits on the basis that he had failed to establish that that he was injured in an “accident” within the meaning of the SABS–1996.¹ Mr. Stephenson challenged this decision by filing both an appeal and an application for variation/revocation, but withdrew the application for variation/revocation on the day of the hearing. Therefore, the matter proceeded as an appeal, restricted to questions of law.

For reasons set out below, I find no error of law and, therefore, the appeal is dismissed.

II. ANALYSIS

Mr. Stephenson went to an outdoor party at his friends’ farm in July 2004. He drank heavily through the afternoon and into the early hours of the morning. At about 2:00 or 3:00 a.m., some other people at the party found him lying on the ground near to his van. They tried to get him into the van, but gave up after getting only his torso inside. At about 5:30 a.m., Mr. Stephenson was found lying on the ground next to his van, with his head resting on the running board, calling for help. He was taken to hospital by ambulance where he was treated for mild hypothermia before it was eventually determined that he had suffered a neck injury - acute disc herniation at the C3-4 level.

The question at the arbitration was whether Mr. Stephenson was injured as a result of an “accident” as defined in s. 2(1) of the SABS-1996:

an incident in which the use or operation of an automobile directly causes an impairment…

To determine the issue before him, the arbitrator had to decide a factual question – exactly what happened that night to cause Mr. Stephenson’s injuries? – and a legal question – do the facts, as found, constitute an “accident”?

The onus was on Mr. Stephenson to prove his claim on a balance of probabilities. He presented various evidence, including his own testimony. As Economical points out, this was not a case where Mr. Stephenson could not remember what happened. Rather, it was his contention that he was getting into his van to sleep in the back seat, which he had folded down earlier to use as a bed, when he fell backwards out of the van, striking his head on the running board, resulting in his injuries.

The arbitrator agreed that if Mr. Stephenson’s version was accurate, he would be entitled to accident benefits:

I find that sleeping in the fold-down back seat is a well-known use of a van. I therefore find that, if Mr. Stephenson was injured when he fell out of his van as he was about to retire for the night, he would have been injured as a result of an “accident” as defined.

However, for reasons set out in his decision, the arbitrator found Mr. Stephenson’s evidence unreliable. He examined the other evidence, including testimony from both lay and expert witnesses, concluding that Mr. Stephenson did not suffer a blow to the head. Instead, he found that Mr. Stephenson’s condition when he was first discovered lying on the ground next to the van was due to alcohol intoxication, likely complicated by his diabetes. However, this did not explain the neck injury, which the arbitrator addressed in the final paragraph of his reasons, as follows:

Since I have found that Mr. Stephenson had not suffered a blow to the head but was incapacitated by alcohol when found lying next to his van, I accept Dr. Shank’s opinion that, the explanation for Mr. Stephenson’s injury is likely found in the “prolonged extreme neck posturing as he lay intoxicated” in the doorway of his van. I find that Mr. Stephenson has not proven that he fell out of his van as claimed. I therefore find that Mr. Stephenson was not injured as a result of an “accident” as defined in section 2(1) of the Schedule.

As mentioned above, Mr. Stephenson filed an Application for Variation/Revocation along with his Notice of Appeal, claiming there were a number of errors in the order. On the day of the appeal hearing, counsel for Mr. Stephenson advised that the application for variation/revocation was not being pursued. As I indicated at the hearing, I believe that was an appropriate decision. An application for variation/revocation is not meant to be a back-door route for challenging factual findings that cannot be challenged on appeal due to the question-of-law restriction.

Mr. Stephenson’s appeal focuses on the following statement from the decision:

Economical made extensive submissions on whether Mr. Stephenson could be found to be engaged in the use of his van if found to be camping, at the time of his injury. The only theory Mr. Stephenson advanced was that he fell out of his van when he tried to get in to retire for the night. For that reason, I find it unnecessary to address the issue of whether the broader activity of camping encompasses the direct use of an automobile. (p.4)

Mr. Stephenson claims he advanced the “camping” argument at the arbitration hearing and that it was an error of law for the arbitrator to fail to address it. In support of this position, he referred to his written submissions, filed after the last day of the arbitration hearing, where he argued that camping is a normal and well-known activity to which automobiles are put. Although his contention was that he fell out of the van, he presented the following alternative argument:

If it is accepted that Mr. Stephenson passed out or fell while on his way to his van (including or excluding the possibility that he sustained his injury as a result of laying with his neck in an awkward position for an extended period of time), it is respectfully submitted that the incident still comes within the purview of the definition of “accident.” Mr. Stephenson had been to his van several times earlier in the evening to get beer and was on his way to the van to sleep. Throughout the afternoon and evening, he was using his van for camping, storing his beer in a cooler in the back, returning to the vehicle several times throughout the party, and intending to sleep there at the end of the night.

Mr. Stephenson also points to Economical’s written submissions at arbitration, which he claims respond to his “camping” argument, and to his responding submissions, which reinforce his contention that his van was intended for camping and he was using it for that purpose.

I accept that Mr. Stephenson maintained the broader “camping” argument at arbitration as an alternative if the arbitrator found that his injuries were not as closely tied to the van as he claimed. As set out above, he argued that even if the arbitrator rejected his evidence that he was injured when he fell out of the van and, instead, found that he was injured in a fall on his way to the van, it still was an “accident” because it was part of the activity for which he was using his van – camping.

Although the arbitrator should have dealt with this argument, I find it has little strength. Mr. Stephenson’s interpretation is simply too broad. None of the decisions interpreting the “directly causes” wording supports such a broad interpretation. The fact that sleeping in a van may be an ordinary use, making it useful for engaging in the broader activity of camping, cannot mean that Mr. Stephenson was covered by automobile insurance for any impairment that occurred during his time on his friend’s farm. There must be a direct connection between the use or operation of the vehicle and the impairment. In my view, even if the arbitrator had found that Mr. Stephenson fell on his way to or from the van, the fact that the van was set up for sleeping and being used to store camping gear and beer would not distinguish the situation from a fall on the way to or from any other type of automobile. Unless some use or operation of the vehicle directly caused the impairment, it is not an “accident” within the meaning of the SABS-1996. Therefore, I reject the argument advanced by Mr. Stephenson in his Notice of Appeal.

On the day of the appeal hearing, Mr. Stephenson raised a new argument based on the final paragraph of the arbitrator’s reasons, excerpted above. He submitted that the arbitrator’s acceptance of Dr. Shank’s opinion that “the explanation for Mr. Stephenson’s injury is likely found in the ‘prolonged extreme neck posturing as he lay intoxicated’ in the doorway of his van,” establishes a direct connection between the van and his injuries.

Economical strenuously objected to the new argument. In its submission, it was raised far too late and, in any event, the argument is inconsistent with the position Mr. Stephenson advanced at arbitration – that he was injured in a fall. Although I found considerable merit in Economical’s position, I was not prepared to prevent Mr. Stephenson from advancing an argument that could establish his entitlement to accident benefits. I heard his oral submissions, but to ensure that Economical had an adequate opportunity to respond, its submissions were deferred to a later date, to be provided if necessary.

After considering Mr. Stephenson’s submissions on the new argument and reviewing the relevant evidence, I concluded that I did not need to hear from Economical.

As noted above, the onus was on Mr. Stephenson to prove his claim. The arbitrator did not accept his version of events. In my opinion, therefore, the final paragraph of the decision can be read as the arbitrator’s conclusion that Mr. Stephenson failed to establish that he was injured in a fall directly related to the use or operation of his van, as he claimed. However, even if the paragraph is read as a finding that Mr. Stephenson was injured due to prolonged extreme neck positioning as he lay intoxicated in the doorway of his van, that is not enough to bring it within the definition of “accident.” Such a finding does no more than establish the van, or at least the running board, as the location where he was lying in an awkward position, apparently due to his intoxication. Therefore, I find no error in the arbitrator’s dismissal of Mr. Stephenson’s claim.

For these reasons, the appeal is dismissed.

III. EXPENSES

If the parties are unable to agree about expenses of this appeal, a hearing may be arranged in accordance with Rule 79 of the Dispute Resolution Practice Code.

December 4, 2007

David R. Draper Director of Arbitrations

Date

Footnotes

1. 1The Statutory Accident Benefits Schedule - Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.