Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2009 ONFSCDRS 165

Appeal P09-00004

OFFICE OF THE DIRECTOR OF ARBITRATIONS

ALAN BROOKES

Appellant

and

AVIVA CANADA INC.

Respondent

Before:

David Evans

Representatives:

David J. Gillespie for Mr. Brookes

Susan Bromley for Aviva Canada Inc.

Hearing Date:

September 21, 2009

PRELIMINARY APPEAL ORDER

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

Leave to file fresh evidence in this appeal is refused and any references thereto in Mr. Brookes' Written Submissions on Appeal are struck.
The expenses of this preliminary appeal decision are deferred to the conclusion of this appeal, subject to any other or further order of an appeals adjudicator.

December 2, 2009

David Evans Director's Delegate

Date

REASONS FOR DECISION

I. NATURE OF THE APPEAL

Mr. Alan Brookes appeals the arbitrator's order of January 9, 2009, regarding the amount of his pre-accident and residual earning capacity, as determined by the SABS-1994.¹ He now seeks to introduce an employment letter and a medical assessment as fresh evidence.

II. BACKGROUND

On July 1, 1994, Mr. Brookes, a passenger in a vehicle, was severely injured. His brother Paul Brookes, also a passenger, survived with relatively minor injuries; the driver died.

At the time of the accident, Mr. Brookes was on the unemployed members list as a journeyman insulator with the International Association of Heat & Frost Insulators and Asbestos Workers. He could not return to work as an insulator, qualifying him for a loss of earning capacity benefit (LECB).

An LECB is based on pre-accident earning capacity (PEC) and residual earning capacity (REC).

Pursuant to s. 29 of the SABS-1994, an insured's PEC depends upon employment status. Although Mr. Brookes was unemployed at the time of the accident, he was an insured person who was employed at some point during the 156 weeks before the accident.² The arbitrator was therefore required by s. 29(3) to calculate his PEC "using the gross annual income from employment that the person could reasonably have earned at the time of the accident, having regard to the person's personal and vocational characteristics at that time."

Regarding those characteristics, Mr. Brookes relied on his union's Business Manager's letter dated July 14, 1994. It indicated that Mr. Brookes would have been recalled to work within a week of the accident at $32.46 an hour for 38 hours per week. The arbitrator accepted these figures but not "that the PEC should be calculated on a straight line basis without consideration of Mr. Brookes' history of unemployment during the 156 week period prior to the accident." Instead, she accepted Aviva's averaging of Mr. Brookes' periods of pre-accident employment and unemployment.

Mr. Brookes seeks to file a second Business Manager's letter because the arbitrator stated "Had I had evidence that the work set out in the Business Manager's letter would have been available to Mr. Brookes for a year or more following the accident, I would have been inclined to apply a straight line approach." The letter purports to provide this evidence, as well as to draw parallels with the career of Mr. Brookes' brother Paul, who was also a journeyman insulator in the same union as Mr. Brookes.

Regarding the REC, the arbitrator relied on two residual earning capacity designated assessment centre assessments, or REC DACs. The July 1999 assessment established Mr. Brookes' initial REC. The May 2004 report reassessed the initial REC as part of the 3-year review mandated by s. 33 of the SABS. On that basis, the arbitrator determined Mr. Brookes' RECs for the periods from September 23, 1999 to June 15, 2004 and from June 16, 2004 to March 7, 2007.

The arbitrator noted that "Presently, the 8 year review is in progress. This review is not in dispute at this proceeding." Mr. Brookes now seeks to file the REC DAC for the 8 year review from LifeMark Assessments dated February 13, 2009.

III. ANALYSIS

The following criteria for admitting fresh evidence, as set out by the Supreme Court in Palmer v. The Queen, [1980] l S.C.R. 759, have been adopted on appeal in cases such as Plows and Jevco Insurance Company, (OIC P-000175, P-000588, May 22, 1992) and Budd and Personal Insurance Company of Canada, (FSCO P99-00032, January 8, 2000):

The evidence should generally not be admitted if, by due diligence, it could have been adduced at trial;
The evidence must be relevant in the sense that it bears upon a decisive or potentially decisive issue in the trial;
The evidence must be credible, in the sense that it is reasonably capable of belief; and
The evidence must be such that, if believed, it could reasonably, when taken with the other evidence adduced at trial, be expected to have affected the result.

It is important to remember that these criteria were first laid out in a different context. Until 1996, s. 283(1) of the Insurance Act provided that "A party to an arbitration may appeal the order of the arbitrator to the Director." Furthermore, on appeal, s. 283(4) gave great latitude in the manner of determining an appeal, as it specifically provided for a rehearing:

(4) The Director may determine the appeal on the record or by way of a rehearing of all the issues before the arbitrator or partly on the record and partly by way of rehearing as the Director in his or her opinion may decide.

By way of contrast, s. 283(1) now provides that "A party to an arbitration under section 282 may appeal the order of the arbitrator to the Director on a question of law," and s. 283(4) that "The Director may determine the appeal on the record or in such other manner as the Director may decide, with or without a hearing."

I point this out because Mr. Brookes submits that the change to s. 283(4) actually widens the discretionary authority of the Director. Accordingly, with respect to the most recent REC DAC, Mr. Brookes submits that it should be admitted so that I can determine whether to extend LECB benefits beyond the period considered by the arbitrator. I disagree. My role is not to conduct a rehearing or to weigh the evidence that the arbitrator has already considered, and it is certainly not to go further and consider the most recent REC DAC against that same evidence.

In that regard, the Divisional Court stated at par. 29 in Kanareitsev v. TTC Insurance Company Limited, 2008 CanLII 26262 that "Particularly when results turn on the first instance decision maker's view of the credibility of witnesses and involves a fact-driven analysis, appellate review must take 'proper account of the distinct advantage' of the first-instance decision maker's assessments. The appeal judge must not try the case de novo or simply substitute his or her views for those of the trial judge."³ Mr. Brookes, in seeking to have me review the most recent REC DAC, is essentially asking me to substitute my views for those of the arbitrator and to conduct a rehearing.

In any event, to return to the Palmer criteria, I do not consider the REC DAC relevant to the appeal. Mr. Brookes' medical status in 2009 was not at issue before the arbitrator.

Regarding the further letter from the union that Mr. Brookes seeks to file, the letter is not reliable because it consists of the recollection by its author of events from 15 years ago. I am not persuaded that the "straight line" calculation is appropriate, as it would reflect the same capacity as a person working at the time of the accident.⁴ Finally, the evidence could have been adduced at the hearing, and thus is the kind of tailored evidence the fresh evidence rule is meant to exclude.

Accordingly, leave to file fresh evidence in this appeal is refused and any references thereto in Mr. Brookes' Written Submissions on Appeal are struck.

IV. EXPENSES

The expenses of this preliminary appeal decision are deferred to the conclusion of this appeal, subject to any other or further order of an appeals adjudicator.