Financial Services Commission des
Commission services financiers
of Ontario de l’Ontario
Neutral Citation: 2008 ONFSCDRS 136
FSCO A07-000984
BETWEEN:
TERESA MURPHY
Applicant
and
CERTAS DIRECT INSURANCE COMPANY
Insurer
DECISION ON A PRELIMINARY ISSUE
Before: Fred Sampliner
Heard: By telephone conference call on June 28, 2008. Written submissions were received on July 16 and 23, 2008.
Appearances: Meredith J. Donohue for Mrs. Murphy Robert H. Rogers for Certas Direct Insurance Company
Issues:
The Applicant, Teresa Murphy, was injured in a motor vehicle accident on December 5, 2001, and her claims for statutory accident benefits from Certas Direct Insurance Company (“Certas”) under the Schedule1 are scheduled for an arbitration hearing before the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended. On March 25, 2008, Arbitrator Lee allowed Mrs. Murphy to add her various accident benefit claims from a Court action into this arbitration providing that she discontinue or withdraw it in 30 days. Mrs. Murphy did not act to combine her Court claims for accident benefits claims into this arbitration. She seeks a decision on whether Certas will succeed in arguing that the issues from her Court action are barred from proceeding in arbitration before she withdraws or discontinues those claims in that forum.
The preliminary issue is:
- Are Mrs. Murphy’s claims for accident benefits in her Court action precluded from proceeding to arbitration because they are beyond the two-year limitation period set out in subsection 281(5) of the Act and subsection 51(1) of the Schedule?
Result:
- The determination of whether the time limitation defence applies to Mrs. Murphy’s accident benefits claims in her Court action cannot occur until she transfers the issues to this arbitration.
ANALYSIS:
Although arbitrators have authority to determine disputed issues the insured person brings to arbitration2, Mrs. Murphy’s catastrophic impairment designation is the only issue currently before this Tribunal. There are no benefits in issue here.
Mrs. Murphy does not want to risk transferring her claims for accident benefits pending in her Court action without assurance Certas will not succeed on its defence that she did not apply for arbitration within the statutory time limit, under the Insurance Act. Certas intends to argue that once Mrs. Murphy withdraws or dismisses her accident benefits claims in Court they are statute-barred, not having been filed in arbitration within the appropriate two-year period.
In a nutshell, joining all issues presents Mrs. Murphy with a dilemma. Under Arbitrator Lee’s order she may add all of the issues together in this arbitration to maximize speed and efficiency of process, but this subjects her to the new possibility that her transferred claims may be dismissed without looking at the merits.
Mrs. Murphy argues that this Tribunal should determine Certas’ time-limitation defence because it reasonably and consequentially flows from Arbitrator Lee’s order.3 Arbitrators have historically applied this reasoning where, for example, repayment or quantum of a benefit category is inextricably bound with entitlement. However, it is not an overly technical distinction that Mrs. Murphy maintains her legal action for her accident benefits claims through the Court system presently.
The Court presently has jurisdiction to address Mrs. Murphy’s substantive claims for accident benefits. I am compelled to find this Tribunal has no jurisdiction to make a preliminary determination about Certas’ time-limitation defence until Mrs. Murphy joins them herein.
Mrs. Murphy should decide whether she will join her accident benefits claims into this proceeding as soon as possible. I understand Certas waives objection to her non-compliance with the 30-day period Arbitrator Lee provided for transferring her accident benefits claims from Court to this process.
I allow Mrs. Murphy 30 days from this date to decide and make that transfer. Consequently, I have re-scheduled the September 2008 hearing dates to late January and early February 2009 to accommodate the parties’ preparations.
The denial of Mrs. Murphy’s motion does not mean I am inclined to accept Certas’ position on its time-limits defence. Mrs. Murphy apparently filed her Court lawsuit in 2004, thereby putting Certas on notice she contested the denial of her claims for accident benefits. I do not understand the rationale why immediate transfer of her claims from Court to this action somehow negates her 2004 notice of legal action, and remain seized of this preliminary issue.
EXPENSES:
I defer the parties’ claims for their expenses of the arbitration to the main hearing officer.
August 12, 2008
Fred Sampliner
Arbitrator
Date
Financial Services Commission des
Commission services financiers
of Ontario de l’Ontario
Neutral Citation: 2008 ONFSCDRS 136
FSCO A07-000984
BETWEEN:
TERESA MURPHY
Applicant
and
CERTAS DIRECT INSURANCE COMPANY
Insurer
ARBITRATION ORDER
Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
Mrs. Murphy’s motion for an order determining whether her accident benefit claims in her Court action are subject to a time limitation defence is dismissed. She has 30 days from the date of this order to join any accident benefits claims from her Court action into this proceeding.
The main hearing in this matter is re-scheduled to January 26, 27, 28, February 2, 3, 4, 2009.
August 12, 2008
Fred Sampliner
Arbitrator
Date
Footnotes
- The Statutory Accident Benefits Schedule — Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.
- Subsection 282(3) of the Insurance Act
- Decicco and State Farm Mutual Automobile Insurance Company (OIC A-000277, December 18, 1991)