Farhat Abbas v. Security National Insurance Co./Monnex Insurance Mgmt. Inc., 2009 ONFSCDRS 24

Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2009 ONFSCDRS 24

Appeal P08-00034

Appellant

and

SECURITY NATIONAL INSURANCE CO./MONNEX INSURANCE MGMT. INC.

Respondent

BEFORE:

Delegate Lawrence Blackman

Mr. Arvin Gupta for Mr. Farhat Abbas

Mr. Christopher A. Caston and Mr. Alexander Lempp for Security National Insurance Co.

HEARING DATE:

Written submissions were received by February 6, 2009

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

The grounds for appeal set out in the Appellant’s Notice of Appeal dated October 28, 2009 and in his written submissions dated December 19, 2008 may proceed to appeal.
The Respondent shall have until March 10, 2009 to serve and file any further written submissions upon which it intends to rely regarding the further grounds for appeal.
The Appellant may not file the Affidavit of Mr. Alon Rooz, sworn December 19, 2008, as fresh evidence in this appeal.
The legal expenses of this preliminary issue decision are deferred to the final determination of this appeal, subject to any further or other appellate order.

February 18, 2009

Lawrence Blackman Director’s Delegate

Date

I. NATURE OF THE APPEAL

The Appellant, Mr. Farhat Abbas, was injured in a motor vehicle accident on October 15, 2005.

A four-day arbitration hearing was held before Arbitrator Lee (the “Arbitrator”) in June 2008. The Arbitrator’s October 1, 2008 decision dismissed the Appellant’s claims against the Respondent, Security National Insurance Co./Monnex Insurance Mgmt. Inc., for medical treatment and housekeeping benefits under the Schedule¹ as well as his claim for a special award. The Arbitrator awarded the Respondent its legal costs of the arbitration.

The grounds for appeal enumerated in the October 28, 2008 Notice of Appeal are brief, being that the Arbitrator erred in finding (1) that the Respondent was not required to pay for two treatment plans under section 38 of the Schedule and (2) that the Appellant’s counsel had given an undertaking on June 13, 2008, three days before the start of the arbitration hearing.

The Notice of Appeal indicated that regarding the alleged undertaking, the Appellant might seek to introduce fresh evidence on appeal by affidavit or oral testimony of Mr. Alon Rooz, counsel for the Appellant, and/or the June 13, 2008 pre-hearing arbitrator.

The November 21, 2008 Response to Appeal argued, in part, that the requested fresh evidence was not justified and there was no basis in law to compel a Commission arbitrator to be a witness at a proceeding. The Respondent argued that the undertaking was not a proper subject for appeal and, in any event, nothing turned on it except perhaps the question of legal expenses, which had not yet been decided.

The Appellant’s written submissions were filed on December 22, 2008. In addition to appealing the findings regarding the two treatment plans and the undertaking, the Appellant also sought an order of entitlement to housekeeping benefits, interest, a special award and his arbitration legal expenses.

The Appellant’s materials included an affidavit of Mr. Alon Rooz sworn December 19, 2008. The Appellant argued that the evidence therein could not be adduced at arbitration as the allegation that Mr. Rooz had given an undertaking to produce certain witnesses was first raised at the arbitration hearing and the Appellant was not given a reasonable opportunity to respond. The Appellant submitted that the alleged undertaking was “a decisive factor on the outcome of the Appellant’s entitlement to housekeeping benefits” and the Arbitrator’s adverse inference against him to fulfill his undertaking “appears to be the sole factor … considered, and it is the consideration on which [the Arbitrator] found that the housekeeping invoices had no weight.”

The Respondent’s written submissions were received on January 19, 2009. The submissions, due January 12, 2009 pursuant to Rule 54.3 of the Dispute Resolution Practice Code (Fourth Edition, Updated – October 2003) (the “Code”), were forthcoming after verbal and written reminders from this office. The Respondent’s further submissions, received February 5, 2009, were also late and were received after a verbal reminder from this office.

The Respondent strenuously objects to including in this appeal those grounds not set out in the initial Notice of Appeal. The Respondent submits that if applicable timelines are to have any meaning, they should be enforced, “in most instances.” The Respondent requests that the additional grounds for appeal be dismissed outright. The Respondent again objects to the Appellant’s request to introduce fresh evidence on appeal.

II. ANALYSIS

(a) Scope of Appeal

Rule 81 of the Code provides that subject to the requirements of the Insurance Act, R.S.O. 1990, c. I.8 and the Statutory Powers Procedure Act, R.S.O. 1990, c. S. 22, an adjudicator may, on such terms as are considered just, amongst other things, set aside any time limit set out in the Code for serving any notice or doing any act. Pursuant to this Rule, I extend the time for the

Respondent’s written submissions notwithstanding the Appellant’s objections of February 6, 2009 and the Respondent’s own insistence on strict compliance, in most circumstances.

Subsection 283(2) of the Insurance Act, R.S.O. 1990, c., I.8 provides that a “notice of appeal shall be in writing and shall be delivered to the Commission within thirty days after the date of the arbitrator’s order.” Subsection 282(3) of the Insurance Act provides that the time for requesting an appeal may be extended by the Director (or by virtue of subsection 6(4) of the Insurance Act, his or her delegate) if there are reasonable grounds for granting the extension. Directions may be given, as are considered proper, as a condition of granting an extension.

The October 28, 2008 Notice of Appeal was delivered in a timely manner from the October 1, 2008 decision. Subsection 282(2) of the Insurance Act, by itself, does not limit an appellant to the grounds set out in the Notice of Appeal. If that were so, the requisite written submissions required under Rule 54 of the Code would, to a significant extent, be superfluous.

The issue before me is essentially a question of amending an initial pleading. Rule 26.01 of the Rules of Civil Procedure, although obviously not binding, is helpful. It provides that:

On motion at any stage of an action, the court shall grant leave to amend a pleading on such terms as are just, unless prejudice would result that could not be compensated for by costs or an adjournment.

The Appellant’s expanded grounds for appeal, to a significant extent, flow naturally and consequentially from the undertaking in issue. The latter, by itself, would appear to have little or no meaning on appeal. Only in the context of entitlement to specific benefits, interest and a possible special award does the undertaking take on significance. A special award and interest also flow from the treatment plans which are specifically noted in the Notice of Appeal.

The prejudice, if any, to the Respondent in allowing the expanded grounds for appeal, is essentially tactical. The hearing in this appeal is set for May 28, 2009. There is no argument that the Respondent will have insufficient time to properly prepare for the appeal. I allow the appeal to include the more expansive grounds set out in the Appellant’s written submissions. As a condition in this specific case, I allow the Respondent until March 10, 2009 to serve and file any additional written submissions upon which it intends to rely regarding the further grounds for appeal.

(b) Fresh Evidence

In Budd and Personal Insurance Company of Canada, (FSCO P99-00032, January 8, 2000), Delegate McMahon adopted the following criteria regarding admitting fresh evidence on appeal:

The evidence should generally not be admitted if, by due diligence, it could have been adduced at trial;
The evidence must be credible, in the sense that it is reasonably capable of belief;
The evidence must be relevant in the sense that it bears upon a decisive or potentially decisive issue in the trial; 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.

At arbitration, the Appellant claimed $100 a week for housekeeping and home maintenance services onwards from January 9, 2006. As of the arbitration hearing, this claim would amount to approximately $12,500. Regarding these claims, the Arbitrator states in his decision:

The Applicant directed my attention to invoices for housekeeping (Tab 4 of Exhibit 2) in their submissions at the conclusion of the hearing. This matter was never addressed during the evidentiary portion of the hearing, and neither the housekeeper nor Mr. Abbas testified before me, despite the undertakings made by Applicant's counsel only two days before the commencement of this hearing.

In response, Security National argued that no weight should be given to these invoices because no witness had appeared to support them. Security National suggested that I should also draw a negative inference from the fact that neither the housekeeper nor the person who purported to receive the housekeeping benefit testified before me.

I accept Security National's argument. The persons who made these invoices did not appear before me. No housekeepers testified, despite the Counsel's undertaking to have them available at the hearing for cross-examination. I also draw an adverse inference based upon their nonattendance. In these circumstances, I give no weight to the housekeeping invoices presented by the Applicant. I do not find that the Applicant is entitled to payments for the housekeeping and home maintenance services claimed.

Earlier in his decision, noting that the only witness called by the Appellant was Dr. D. Polyvos, D.C., the Arbitrator states that it “is highly unusual for an Applicant not to appear at his own hearing.” There is no indication that Dr. Polyvos, whose report was based not on a physical examination but on a paper review, testified on the requisite criteria under section 22 of the Schedule of reasonableness or necessity of the housekeeping claim.

The housekeeping claims are supported by six, unsworn invoices. The $2,460 total covers only the period October 17, 2005 to April 2, 2006. I am not persuaded that Mr. Rooz’ affidavit evidence regarding the undertaking, if believed, could reasonably, when taken with the absence of any oral or other evidence supporting the housekeeping invoices, be expected to have affected the result. The Appellant, in his written submissions, submits that the alleged undertaking was first raised on June 16, 2008, the first day of the four-day hearing. I am not persuaded that the evidence set out in the Mr. Rooz’ affidavit could not, with due diligence, have been adduced at the arbitration hearing.

Accordingly, the Appellant’s request to file Mr. Rooz’ affidavit as fresh evidence is denied.

III. EXPENSES

The legal expenses of this preliminary decision are deferred to the final determination of this appeal, subject to any further or other order of an adjudicative officer.

February 18, 2009

Lawrence Blackman Director’s Delegate

Date

Footnotes

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