Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2007 ONFSCDRS 77

FSCO A04-001909

BETWEEN:

FARID SHEMOU

Applicant

and

ING INSURANCE COMPANY OF CANADA

Insurer

REASONS FOR DECISION

Before:

John Wilson

Heard:

November 7, 8 and 9, 2006, at the offices of the Financial Services Commission of Ontario in Toronto.

Appearances:

Mr. Shemou was self-represented

Lorraine Takacs for ING Insurance Company of Canada

Issues:

The Applicant, Farid Shemou, was injured in a motor vehicle accident on January 30, 2003. He applied for statutory accident benefits from ING Insurance Company of Canada ("ING"), payable under the Schedule.¹ ING refused to pay weekly income replacement benefits. The parties were unable to resolve their disputes through mediation, and Mr. Shemou applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

Since the greatest part of Mr. Shemou's claim involved income replacement benefits, and that claim was based solely on an offer of employment that was to take effect after the accident, I ordered that this matter be bifurcated and heard in two portions. This, the first portion, deals only with the question of:

Does the claimed offer of employment meet the formal requirements of section 4(3)(i) of the Schedule?

Result:

Mr. Shemou had received a legitimate job offer from Alex's Sports Bar, prior to being involved in the motor vehicle accident on January 30, 2003, which meets the formal requirements of section 4(3)(i) of the Schedule.

I provided the parties with my decision in this matter by way of letter dated January 29, 2007. What follows are the more complete reasons for that decision.

EVIDENCE AND ANALYSIS:

This matter has a long history before the Commission. Mr. Shemou's claim first proceeded to hearing on March 27, 2006, when it was adjourned due to the unavailability of key witnesses, who had not been summonsed by either his counsel of record, Alon Rooz of the law firm of Mazin & Rooz or Ms. Dimple Verma, the lawyer who actually appeared for Mr. Shemou at the hearing.² At that time, I scheduled a resumption of the hearing for August 2006, since counsel for Mr. Shemou was not ready to proceed. I reserved at that time on an order of costs thrown away resulting from the last-minute adjournment.

Prior to the resumption of the hearing, a motion was placed before me requesting an order that Mazin & Rooz be permitted to withdraw as solicitors of record for Mr. Shemou in this matter. Mr. Shemou contested this withdrawal. Due to the nature of the evidence presented by both sides, this motion was heard in the absence of counsel for the Insurer. After a hearing on that issue I found that there was an irrevocable breakdown in confidence between Mr. Shemou and his counsel of record, and that it would be inappropriate for the law firm to remain on the record. Mazin & Rooz and, more specifically, Mr. Alon Rooz were given permission to withdraw, but subject to any potential liability for costs in this matter pursuant to section 282(11) of the Insurance Act.

Despite several attempts to obtain counsel, Mr. Shemou advised that he was unable to do so, and this matter ultimately proceeded to hearing with Mr. Shemou unrepresented. At his request, I allowed a friend and cousin, Billy Stephan, who spoke both Assyrian and English, to assist him in the presentation of his case. An interpreter was also present at the hearing.

Mr. Shemou testified on his own behalf. He also called Mr. Alex (Aklas) Zaro, the former owner of the sports bar where Mr. Shemou claimed he was offered work.

Mr. Shemou's story can be summarized as follows: He was born in Iraq, and after the completion of his compulsory military service, and some limited employment³ in Iraq, moved to Canada in 1991. Once in Canada, he worked from time to time at factory jobs, but by 2003, just prior to his motor vehicle accident, he was out of work and at loose ends. He apparently spent a significant part of his free time socializing with fellow Iraqis at a bar that catered to his community, Alex's Sports Bar.

It was during his period of socializing at the bar that Mr. Shemou claimed to have been offered employment, with his work to commence around February 3, 2003. Unfortunately the motor vehicle accident intervened and Mr. Shemou never commenced work.

ING did not take the job offer seriously. It refused to pay out income replacement benefits based on the supposed job offer, since it found employment at that time as a "bartender" unlikely, given Mr. Shemou's career path in Canada, and the fortuitous timing of the offer, not to mention the paucity of details provided with regard to wages, hours of work and responsibilities. It would be fair to say that the Insurer felt that the job offer just didn't have the "ring of truth" about it.

Section 4(3)(i) of the Schedule⁴, which applied at the time of Mr. Shemou's accident, sets out the requirements for basing entitlement for income replacement benefits on a valid offer of employment with the commencement date set after the date of the motor vehicle accident rather than the insured's income in the qualifying period either 4 weeks prior to the accident or 52 weeks prior to the accident, as the case may be.

The Court of Appeal has described the operation of the section as follows:

The one exception is found in para. 3 of s.4(1). Persons who fall within the category described in that paragraph are eligible for an income replacement benefit even if they were not employed at the time of the accident or prior to the accident as long as at the time of the accident they were entitled to commence employment within one year pursuant to a written contract of employment. Persons who fall within the exception in para. 3 of s. 4(1) will have their income replacement benefit calculated not on the basis of income earned from employment prior to the accident, but on the amount payable under the contract of employment extrapolated to reflect an annual income.⁵

The provision requires a "legitimate" offer, that has been reduced to writing, and that the offer be prospective rather than retrospective.⁶

To the Insurer the informality and the vagueness of the offer of employment, together with the seeming inability of Mr. Shemou's counsel to provide corroboration or even locate the individual who allegedly made the offer, must have reinforced any suspicions that it had of its legitimacy.

ING argues that any "legitimate" offer must be a complete offer - one that would create an obligation that could be enforced by the courts. As such, the offer would have to set out the terms, salary and duration of the employment contract, not to mention the duties that Mr. Shemou would be expected to perform. Even a glance at the written memorandum supplied by Mr. Shemou shows that it may well be lacking in more than one of these attributes.

I do not accept, however, that a job offer has to be perfectly and completely draughted to be legitimate. It is not expected to set out job duties with the precision of a job description in a collective agreement. The framework for comparison is the day-to-day employment world, where jobs, often menial and low skilled, are offered and accepted on a handshake and a few words about hours and expectations and salary, not the world of formal employment contracts.

The key words used in the legislation are "legitimate" and "written." Had the legislature wished to narrow entitlement further, it could well have employed more specific, limiting words. The clear concerns of the legislature are that the offer be legitimate - bona fide, and that it be reduced into writing at some point in time.

Just what else is required of an employment contract? Arbitrators have long been in agreement that it need not have been reduced to writing before the accident. Again, that the only adjective in the legislative provision is "legitimate" suggests more than a little flexibility in the formal requirements of the offer. 7

The Oxford Canadian Dictionary defines "legitimate" as:

2a conformable to, sanctioned or authorized by, law or principle; lawful.

b conforming to a recognized standard, sanctioned by . . .⁷

An offer that is legitimate then could be variously legal, sanctioned by law, justifiable or even excusable. In the context of this legislation, a legitimate offer would be one that is bona fide and in conformance with the standards set by the appropriate law.

Mr. Shemou claims not to be fluent in English, a claim that was not inconsistent with his performance during the hearing process. It was clear that although he often appeared to understand the gist of what was said, there were significant challenges in any communication that was without the benefit of an interpreter. It would appear from the documents filed that ING used an interpreter at many critical junctures in the claims process. None of the letters, notices, or other official communications from ING to Mr. Shemou appear to have been provided in his language, however.

Early on in the claims process, Mr. Shemou referred to his prospective employment as working "full-time, fulfill the duties of a barman, work 40 hours a week and earn $560.00 per week."⁸

Given the evident linguistic and cultural challenges, I do not put much weight on the use of specific words chosen by Mr. Shemou to describe his proposed work in a restaurant/bar setting.

The letter from "Ikhlas Zaro" confirming the employment offer reads as follows:

March 7, 2003

Dear Mr. Shemou:

In according to our meeting with you on January 24, 2002. We have agreed to offer you our open position of a Barman in our firm as a full time employee working 40 hours a week, with the Barman receiving a salary of $ 560.00 a week. Starting on February 3, 2003.

Sincerely,

(signature)

Ikhlas Zaro

The Manager

Mr. Shemou's position was that the legitimacy of this job offer should be seen in the context of the offer itself. According to him the sports bar was in effect a social club and gathering place for a specific group of Iraqi exiles.⁹ The bar served beer, arak, and some bar foods and Iraqi dishes. Mr. Shemou was known there both as a member of his community and as a patron of the bar.

The proprietor of the bar needed some help. Mr. Shemou was available and a deal was struck for him to assist. Given the informality of the workplace there was no rigid job description. The western definitions of 'barman" and "cook", while potentially describing some of the work to be undertaken, apparently did not catch the flavour of the rather basic position.¹⁰

The Insurer, quite rightly, took the various references by Mr. Shemou and his representatives to "cook" and "barman" somewhat literally, and in the context of western culture. Mr. Shemou had formal training in neither calling. Nor did he seem to have appropriate work experience.¹¹To the Insurer this lack of formal background at the very least weighed on the credibility of Mr. Shemou's assertion that he was offered a bona fide job.

Unlike his former counsel Mr. Shemou was able to obtain the attendance of Mr. Zaro¹², the proprietor of the sports bar, and the person who was supposed to have made the offer of employment. Mr. Zaro essentially confirmed Mr. Shemou's version of events regarding the job offer, and left the impression that even a person with the limited formal skill-set of Mr. Shemou in the restaurant business would have been useful to him in the context of the operations of a bar and gathering place for the Iraqi community.

Counsel for the Insurer raised the issue of the credibility of Mr. Zaro. Given the supposed difficulties in locating him¹³, the failure of the former counsel for Mr. Shemou to provide documents relating to the proposed employment that had been promised, his failure to return telephone calls and the various inconsistencies reported concerning the details of the employment itself, I should find his testimony to be less than credible. For the Insurer, Mr. Zaro's late appearance on the scene with his convenient testimony was just too fortuitous for his testimony to be credible and probative with regard to the job offer.

Notwithstanding the Insurer’s objections, I find that Mr. Zaro’s testimony concerning the job offer itself has the ring of truth about it. I find it credible that he would offer a job to Mr. Shemou, when, as he testified, he needed a "cook" with familiarity with Iraqi food and the Assyrian language, and who was available on fairly short notice. He was under the impression, correct or not, that Mr. Shemou had been associated in some way with Alex’s Sports Bar before his family’s purchase of the business, as well as knowing first-hand Mr. Shemou’s familiarity with Iraqi bar culture.

Given that he believed Mr. Shemou had some restaurant skills, spoke the language, knew the culture of the clients of the bar, and was available on a short notice, it is understandable that Mr. Zaro would make an offer to Mr. Shemou to work at the bar. Whether Mr. Shemou was an ideal candidate, and whether, in the long run, Mr. Shemou could have carried on with all the job duties over a longer period of time is a totally different question, and one that need not be decided in the context of the bona fides of the job offer.

The legislation also includes a stipulation that the job offer be written. Mr. Zaro was candid that he provided the written confirmation of the job offer after the accident, and at the request of Mr. Shemou’s then lawyer, Mr. Rooz.

In any such matter the credibility of the person putting forward a proposition such as this job offer is critical. A judge once summarized the difficulty in assessing claims such as this:

This case largely turns on findings of credibility. These are not always easy to make. In this case, I did not find either of the parties to be credible. That said, while there were numerous inconsistencies in the evidence of Mr. Seraiocco, I have concluded that I prefer his version of events to that of Mr. Messina and his relatives. In my view, Mr. Seraiocco's evidence on performance of his agreement with Mr. Messina had the "ring of truth" and Mr. Messina's did not. ¹⁴

Inconsistencies in testimony need not bar acceptance of the overall assertion, provided that the evidence taken togther has the "ring of truth." Mr. Shemou's claim concerning the job offer was not without some inconsistencies, when examined throughout its history. Such inconsistencies included the title and description of the work, and the circumstances of the job offer itself. Given the situation of a job that was never actually undertaken, the problems with language, and cultural referencing, not to mention the apparent lack of diligence of Mr. Shemou's former counsel in bringing forward clarifying and supplementary information, I find that any such prior inconsistencies are not fatal to the evidence as presented at the hearing.

While the Insurer's objections to the credibility of Mr. Shemou's story of a job offer have been noted, it is also important to underline a fundamental aspect of Mr. Shemou's case that bears repeating. Mr. Shemou has consistently maintained, in spite of serious obstacles, the veracity of his position on the job offer. Faced with the inability of his own counsel to present his case effectively and their ultimate withdrawal, he soldiered on without representation in order to get what he saw as the truth before this arbitration. Although not determinative of the issue, Mr. Shemou's commitment to his cause is a factor to consider in any evaluation of his credibility.

Nor do I accept that I should necessarily draw an adverse interest from the circumstances surrounding Mr. Zaro's failure to provide the requested job information to ING's accountants, and his unavailability at the April and August 2006 hearings.¹⁵ Mr. Zaro's evidence with regard to the latter was that he had advised Mr. Shemou's then counsel of his travel plans in Spring 2006, and he was further advised in August 2006 that he was not needed for the hearing. I should note that Mr. Zaro was not given a summons to witness for the adjourned hearing and was under no obligation to attend.

With regard to the Insurer's requests for job records, it is clear that Mr. Zaro believed that he had supplied what was necessary, given that, due to the accident, no actual employment relationship ever existed, and he had provided a written confirmation outlining the terms of the offer.

It is also important to recall that there was a breakdown in the relationship between Mr. Shemou and his counsel. While Mr. Alon Rooz initially attributed the breakdown to the inability to obtain instructions, Mr. Shemou was vehement that the relationship broke down because of the inability or unwillingness of counsel to pursue this case, including obtaining the necessary evidence from Mr. Zaro. If I accept Mr. Shemou’s version of these events, then it would be inappropriate to accept any adverse inference concerning Mr. Zaro’s failure to appear and provide necessary information about Mr. Shemou’s claim. Given the possibility of other explanations for Mr. Zaro’s reticence with regard to this process, I do accept that an adverse inference should be drawn.

Mr. Shemou has the burden of proof in supporting his claim for the legitimacy of the job offer on which his claim lies. Viscount Dunedin observed, however:

Now, in conducting any inquiry, the determining tribunal, be it judge or jury, will often find that the onus is sometimes on the side of one contending party, sometimes on the side of the other, or, as it is often expressed, that in certain circumstances the onus shifts. But onus as a determining factor of the whole case can only arise if the tribunal finds the evidence pro and con so evenly balanced that it can come to no sure conclusion. Then the onus will determine the matter. But if the tribunal, after hearing and weighing the evidence, comes to a determinate conclusion, the onus has nothing to do with it, and need not be further considered.¹⁶

Mr. Shemou does not have to convince the tribunal that there is no doubt that the job offer existed. He must simply convince on the basis of the balance of probabilities. Mr. Justice Grant described the balance of probabilities as follows:

A balance of probabilities is where it is more probable that an event happened than that it did not happen. The scale of probabilities must be weighed in favour of the event having happened. Where the scales are evenly weighted, then the person who has the burden of proof has not tipped the scales on a balance of probabilities and fails.¹⁷

Mr. Shemou testified at the hearing. As noted, I found him to be generally credible on this issue. Mr. Zaro also testified. In spite of being a "busy man" he had enough recall of Mr. Shemou and the job offer to be credible in his corroboration of the key aspects of Mr. Shemou’s testimony.

ING called no witnesses as to the legitimacy of the employment offer. It relied on cross-examination and on the claims-related documents, including a "job analysis" that took place without Mr. Zaro’s participation. It should be stated that these documents reflect a certain level of mistrust that appears to have developed early in this claim, a mistrust that was not dissipated by the dilatory response of Mr. Shemou’s then counsel to requests for further information.

If ING had other information or witnesses however, who could testify as to the legitimacy of the Alex Sports Bar, it did not bring them before this hearing.

In this matter, I find that it was more likely than not that Mr. Shemou received an offer to work from the principals of the Alex Sports Bar, prior to the motor vehicle accident, which is the subject of this arbitration. I find, as well, that Mr. Shemou never commenced the employment prior to this accident and that the general provisions of this offer were reduced to writing in conformance with section 4(3)(i) of the Schedule.

I make these findings with regard to the legitimacy of the job offer because, in the wider context of this claim, Mr. Shemou’s story hangs together, and has the "ring of truth" about it. Notwithstanding any imperfections in the tale as recounted, it is more probable than not, given the environment of the Alex Sports Bar, the Assyrian/Iraqi expatriate community, and Mr. Shemou’s own cultural background and familiarity, that he would have been offered a position at the bar when help was needed.

While there was evidence before me as to the amount of wages that would have been expected by Mr. Shemou had he started work at the bar, the issue squarely before me at the hearing was the legitimacy of the job offer. Therefore, I make no specific finding as to the quantum if any of any income replacement benefits that Mr. Shemou may be entitled to. Those matters are more appropriately to be dealt with together with the general issues of entitlement in the balance of this hearing process.

EXPENSES:

The issues relating to expenses of this arbitration, with the exception of the interim expense order arising from the March 2006 adjournment, will be dealt with at the conclusion of the balance of the hearing in this matter.

April 19, 2007

John Wilson Arbitrator

Date