Mr. S. v. Aviva Canada Inc., 2010 ONFSCDRS 66

Financial Services Commission des

Commission services financiers

of Ontario de l’Ontario

Neutral Citation: 2010 ONFSCDRS 66

FSCO A09-000794

BETWEEN:

Mr. S.

Applicant

and

AVIVA CANADA INC.

Insurer

PRELIMINARY ISSUE DECISION

Before: Alec Fadel

Heard: November 20, 2009, in Kingston, Ontario, transcipts received on December 2, 2009 and by telephone conference call on February 12, 2010

Appearances: Mr. S. was unrepresented

Catherine Korte and Gordon Lee for Aviva Canada Inc.

The Applicant, Mr. S., was injured in a motor vehicle accident on October 29, 2004. He applied for and received statutory accident benefits from Aviva Canada Inc. (“Aviva”), payable under the Schedule.¹ Aviva terminated certain accident benefits and the parties were unable to resolve their disputes through mediation, and Mr. S. applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

BACKGROUND:

A pre-hearing discussion was held by teleconference on June 11, 2009, and the pre-hearing arbitrator determined that the applicant was seeking entitlement to a non-earner benefit, interest, expenses of the arbitration and a special award. The applicant did not have a representative at the pre-hearing. According to the pre-hearing letter of June 19, 2009, the insurer raised the issue of the applicant’s competency to proceed with the matter and sought a preliminary issue hearing under Rule 10.3 of the Dispute Resolution Practice Code (the “Code”). The arbitrator noted in his pre-hearing letter that he was satisfied that a preliminary issue hearing was warranted “[b]ased on the manner in which the pre-hearing conference proceeded.” The arbitrator also noted that since the pre-hearing he had received and reviewed a report of Dr. Stevenson, psychiatrist, which assisted in his determination that a preliminary issue hearing pursuant to Rule 10.3 should be conducted. At the preliminary issue hearing, the insurer informed me that an application for catastrophic impairment had been made since the pre-hearing.

Issues:

The preliminary issue is:

Is Mr. S. a party under disability as set out in Rule 10 of the Dispute Resolution Practice Code?

Result:

Mr. S. is a party under disability as set out in Rule 10 of the Dispute Resoulton Practice Code.

EVIDENCE AND ANALYSIS:

I conducted the preliminary issue hearing in person on November 20, 2009 in Kingston, Ontario. The preliminary issue was set up pursuant to Rule 10.3 of the Dispute Resolution Practice Code which states:

10.3 Where an adult party has not been declared mentally incapable under the provisions of the SDA [Substitute Decisions Act, 1992], but exhibits signs of mental difficulty during the course of a mediation, settlement discussion, neutral evaluation or proceeding, either party may request a hearing on a preliminary issue, or the Dispute Resolution Group may direct a hearing on a preliminary issue to determine whether:

(a) the party has the mental capacity to proceed in the dispute resolution process;

(b) there is an attorney with a valid continuing power of attorney over the party’s property; or,

(c) there is a person such as a spouse, same sex partner, near relative, close friend or a professional such as a doctor, lawyer or business entity, such as a trust company, who has made or intends to make arrangements for the appointment of a guardian over the party's property under the provisions of the SDA.

Mr. S. attended on his own at the preliminary issue hearing. The insurer filed its written submissions, a production brief and called Dr. Stevenson to give evidence. In its written submissions, the insurer reviewed the recent case law but did not make specific submissions about the applicant’s capacity.

Prior to commencing the capacity hearing, I sat with the applicant to explain my role and what I was there to do. I felt this was necessary to do as the applicant seemed unaware of the purpose of the hearing and seemed anxious about same. The applicant also seemed apprehensive to be involved in the hearing which was evident when he told the case administrator the day prior that he would not be attending the hearing. After speaking with the applicant, he seemed to accept that I was there to determine if he was able to proceed in the arbitration process and that I was not there to find if he was entitled to the benefit that he sought.

During the hearing, I asked the applicant a series of questions relating to Rule 10.3 of the Code and based on his answers, I concluded the following:

The applicant has not been declared mentally incapable under the provisions of the Substitute Decisions Act, 1992 (“SDA”);
There is no attorney with a valid continuing power of attorney over the applicant’s property; and,
There was no person, either a relative, close friend or professional, who has made or intends to make arrangements for the appointment of a guardian over the party’s property under the provisions of the SDA.

During the course of the preliminary issue hearing, I found the applicant to be extremely confused about the arbitration process. It also appeared that the applicant could not focus on the proceeding at hand. I reminded him before the preliminary issue hearing began and throughout the proceeding what the nature of the proceeding was, yet it was never clear that he understood. Even after the initial hearing, when I attempted to gather more information about a potential family member assisting him with the arbitration and again at the resumed prehearing shortly thereafter, it appeared that the applicant was not aware of the nature of my involvement. When asked specifically if he was prepared to go ahead with the arbitration representing himself the applicant replied that he could not run the hearing on his own and noted that there were too many questions being put to him.

After I concluded my questions for the applicant, the insurer noted that Dr. Stevenson, who had examined the applicant on two separate occasions, would be available to give testimony at the hearing. When the applicant heard that Dr. Stevenson would be arriving, he appeared to become very anxious. After noticing his apparent discomfort, I informed him that he was not required to sit in the hearing room with Dr. Stevenson if he did not so desire. The applicant stated that he did not want to talk to Dr. Stevenson as there was a report that Dr. Stevenson had written which the applicant said was not correct. He stated that he could not sit in the same room with Dr. Stevenson. The applicant responded similarly with the suggestion that Ms. Hundevad, a social worker who is a certified capacity assessor under the SDA, would give testimony, stating “she made the error that I was schizophrenic, so I don’t really want to be in the same room.” I informed the applicant that it was his decision to remain or not and after he asked a few questions about the duration of their testimony stated, “I’m sorry, but I don’t - - I can’t be in the same room with two doctors who don’t tell the truth.”

Dr. Stevenson gave evidence at the hearing. He examined the applicant at the request of the insurer on September 25 and October 11, 2007. In his report dated October 15, 2007, Dr. Stevenson noted:

It is my observation that [the applicant] suffers from, almost certainly, Adult Attention Disorder for which he is receiving no treatment. He is very restless, distractible, easily irritated and unable to properly follow directions without prompting. His ability to concentrate is impaired to the point he was unable to complete the questions properly while I was attempting to do a Mini-Mental Status Examination. He is receiving medication, which while appropriate for the management of Mood Disorder, but it would provide no help otherwise for what I consider to be ADHD or ADD. [sic]

Indeed at the preliminary issue hearing, including the later telephone resumption, the applicant appeared “restless, distractible, easily irritated and unable to properly follow directions without prompting.” Dr. Stevenson further stated in his report of October 15, 2007 that though the applicant was able to “grasp and remember his financial situation . . . his mental functioning would handicap his ability to arrive at reasoned and settled decisions regarding his situation and his expectations in any insurance settlement.”

Dr. Stevenson confirmed that the applicant was a difficult patient to interview and was not able to get a complete history out of him. Dr. Stevenson referred to the inability of the applicant to complete the mini mental status examination which likely signified a hyperactive attention deficit disorder. He stated that the applicant was unable “to focus and stay focused on anything, any detail at any time.” Indeed, during the in-person preliminary issue hearing, this is how the applicant appeared. He was highly distractible, easily irritated and continually interruptive. Dr. Stevenson was asked specifically by counsel for the insurer about the applicant’s ability to arrive at reasoned and settled decisions and he stated that he was concerned with the applicant’s changing state of mind. Dr. Stevenson stated that whether or not the applicant could handle money in an orderly and sensible way was a question on his mind that he was unable to answer.

At the insurer’s request, the applicant was also assessed by Ms. Hundevad on October 13, 2009, resulting in a report dated October 20, 2009. In her report, Ms. Hundevad confirmed that she had been asked to provide an opinion regarding the applicant’s ability to manage his finances. Ms. Hundevad confirmed that her analysis was based on the applicant’s financial situation at the time of the assessment. She noted that the applicant was initially quite irritable as he misunderstood the reason for the assessment. Ms. Hundevad noted that “[i]t took some time to explain the reason for the assessment due to his argumentativeness but after this intial hurdle, he cooperated fully with the assessment despite the fact that he felt that he was participating out of duress rather than free choice.” Ms. Hundevad noted that the applicant was “highly distractible” throughout the assessment and engaged in “a lot of extraneous conversation but he could attend to the matter at hand with repeated firm direction.”

Ms. Hundevad addressed the “understand and appreciate” test according to the SDA, noting that:

“Understand” refers to the ability to understand information that is relevant to making a decision, while “Appreciate” refers to the ability to appreciate the reasonably foreseeable consequences of a decision or lack of a decision. Failure to “understand” OR “appreciate” is grounds to conclude incapacity.

Ms. Hundevad concluded that the applicant met the threshold for capacity to manage his finances noting that he had adequate knowledge of his financial affairs and an ability to demonstrate that he had “the basic money management skills required to manage his modest income.”

The insurer referred to an orthopaedic assessment by Dr. Sorbie where in a report of August 3, 2007, he noted a long history of psychiatric illness “[which had] puzzled psychiatrists since he was first assessed in 1991.” Dr. Sorbie noted in his report:

In 1991 and since, it has been assumed that he had attention deficit disorder, a bipolar personality and at one time, schizophrenia was suspected. Psychiatric assessment has revealed aggressive behaviour but not violence. Psychiatric assessment on October 15, 2001 and on March 8, 2002 by Dr. Singh and more recently by Dr. Scott has suggested a pervasive developmental disorder but there is still uncertainty about the actual nature of the psychiatric abnormality.

Dr. Sorbie noted that during the course of the examination his interpretation of the applicant’s complaints was “difficult in view of his hyperactive physical and mental state.” The doctor continued stating that “[h]is answers to questions are inconsistent and in addition, overall, he is very angry about his circumstances.”

ANALYSIS

The insurer referred to Jagdeo and Royal and SunAlliance Insurance Company of Canada² which confirms that an arbitrator is permitted to consider evidence from a variety of sources and is not required to rely on the evidence of a qualified assessor under the SDA. Jagdeo supports that evidence from family doctors, family members, and observations of the applicants themselves are considerations for arbitrators.

In Kabala and T.D. Home and Auto Insurance Company³, Arbitrator Ashby had the opportunity to observe the applicant and found that he demonstrated that he was “capable of sophisticated submissions, is able to control his irritability and meaningfully participate in the process.” The Arbitrator found that there was “insufficient evidence to rebut the presumption” that the applicant had the mental capacity to manage his property as per Rule 10 of the Code.

In H.I. v. Aviva Canada Inc.⁴, Arbitrator Wilson noted that Rule 10 of the Code adopted the modern legislative test for capacity found in the SDA. Section 6 of the SDA states that:

A person is incapable of managing property if the person is not able to understand information that is relevant to making a decision in the management of his or her property, or is not able to appreciate the reasonably foreseeable consequences of a decision or lack of decision.

Arbitrator Wilson referred to Justice Quinn of the Ontario Court (General Division) in Re Koch 1997 CanLII 12138 (ON CTGD), 33 O.R. (3d) 485, on the effect of s. 6 of the SDA:

Compelling evidence is required to override the presumption of capacity found in s. 2(2) of the SDA (Substitute Decisions Act) and s. 4(1) of the HCCA (Health Care Consent Act). The nature and degree of the alleged capacity must be demonstrated to be sufficient to warrant depriving the appellant of her right to live as she chooses. Notwithstanding the presence of some degree of impairment, the question to be asked is whether the appellant has retained sufficient capacity to satisfy the statutes.

Arbitrator Wilson noted that the specific capacity that was in question was whether the applicant had “the requisite capacity to instruct counsel, or if unrepresented, to appreciate the reasonably foreseeable consequences of a decision to file and proceed with this arbitration application on an unrepresented basis.” In H.I. Arbitrator Wilson noted that a qualified capacity assessor, under the SDA had concluded that the applicant had the capacity to manage her own affairs. He also noted that the applicant was able to represent herself through a three day preliminary issue hearing as a self-represented litigant which suggested “a certain ability to engage in a complex decision-making process.”

In Mr. M. and Pembridge Insurance Company⁵, Arbitrator Killoran found that the applicant lacked the capacity to proceed in the arbitration process. The arbitrator noted that at the conclusion of the hearing, the applicant “did not appear to grasp the purpose or the significance of the hearing,” and did not “appreciate the elements of his claim or the nature of the dispute resolution process.”

The situation before me is unlike that in H.I. where the applicant conducted a three day preliminary issue hearing representing herself or in Kabala where the applicant demonstrated an ability to meaningfully participate and appreciate the nature of the dispute resolution process. In this case, the applicant stated and demonstrated that he did not appreciate or understand the arbitration process. The applicant was continually interruptive during the one half hour of questioning, seemed uncomfortable with the process and unsure of my purpose despite being informed of same. He was apprehensive to attend the hearing the day prior, and was unable to stay and hear the evidence of Dr. Stevenson. In H.I. the Arbitrator stated that the object of a preliminary issue hearing of this nature “was to ensure that neither the integrity of the arbitration process, nor the rights of an individual suffering some sort of cognitive or mental impairment were compromised by this proceeding.” After conducting the preliminary issue hearing, I find that both the integrity of the arbitration process and the rights of the applicant would be compromised with a finding that Mr. S. had the mental capacity to proceed in the dispute resolution process.

I find that the applicant does not have the mental capacity to proceed in the dispute resolution process. I refer to the comments of Dr. Sorbie outlined above to find that there are either identified or unidentified psychiatric factors that would hamper the applicant’s ability to proceed through the dispute resolution process. Also, I find the opinion of Dr. Stevenson is compelling evidence which overrides the presumption that the applicant has the requisite capacity to proceed through the arbitration process. Despite the report of Ms. Hundevad and her conclusion that the applicant can manage his finances, I note that the assessor herself stated that her assessment was based on the applicant’s financial situation at the time of the assessment which she describes as “modest.” I find that the report of Ms. Hundevad is not helpful in addressing the question of whether or not the applicant is a party under disability as set out in Rule 10 of the Code.

I find that there is no attorney or a person as described in Rules 10.2, 10.3 and 10.5 of the Code who is suitable, willing and able to proceed in the dispute resolution process and to receive and administer statutory accident benefits on behalf of the application. I therefore look to Rule 10.6 which states:

Where there is no person such as described in Rules 10.2, 10.3 or 10.5 available to act, the adjudicator may notify the Public Guardian and Trustee to request that appropriate steps be taken pursuant to the provisions of the SDA.

I will forward a copy of this decision to the Public Guardian and Trustee to request that the appropriate steps be taken, pursuant to the SDA. Specifically, subsection 27(2) of the SDA states:

Duty to investigate

(2) The Public Guardian and Trustee shall investigate any allegation that a person is incapable of managing property and that serious adverse effects are occurring or may occur as a result. 1992, c. 30, s. 27 (2).

The Commission will follow up with the office of the PGT within 60 days from the date of the issuance of this decision.

May 21, 2010

Alec Fadel

Arbitrator

Date