Financial Services Commission des

Commission services financiers

of Ontario de l’Ontario

Neutral Citation: 2011 ONFSCDRS 4

FSCO A08-001022

BETWEEN:

SARFAZ A. CHOUDRY

Applicant

and

STATE FARM MUTUAL AUTOMOBILE

INSURANCE COMPANY

Insurer

Before: Arbitrator Denise Ashby

Heard: December 1, 2010, at the offices of the Financial Services Commission of Ontario in Toronto

Appearances: Nisarg Munshi for Mr. Choudry

Darrell March for State Farm Mutual Automobile Insurance Company

Issues:

The Applicant, Sarfaz A. Choudry, was involved in a motor vehicle accident on November 11, 2006. He applied for and received statutory accident benefits from State Farm Mutual Automobile Insurance Company (“State Farm”), payable under the Schedule.¹ State Farm terminated certain benefits and refused payment of others. The parties were unable to resolve their disputes through mediation, and Mr. Choudry applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The preliminary issues are:

Does Mr. Choudry require a person to act on his behalf in these proceedings because he is incapable of representing himself, pursuant to Rule 10 of the Dispute Resolution Practice Code?
Should Mr. Choudry’s Application for Arbitration be dismissed because he failed to pursue the appointment of a litigation guardian in a timely fashion or in the alternative failed to provide the status of his application for the appointment of a litigation guardian on or before October 5, 2010?
If Mr. Choudry is found to be entitled to an overdue benefit as a result of the arbitration shall the interest to which he is entitled be suspended for the period of the further adjournment?
Is State Farm liable to pay Mr. Choudry’s expenses in respect of this preliminary issue hearing pursuant to subsection 282(11) of the Insurance Act, R.S.O. 1990, c. I.8?
Is Mr. Choudry liable to pay State Farm’s expenses in respect of this preliminary issue hearing pursuant to 282(11) of the Insurance Act, R.S.O. 1990, c. I.8?

Result:

Mr. Choudry does not require a person to act on his behalf in these proceedings.
Mr. Choudry’s Application for Arbitration is not dismissed. The parties shall arrange for an in-person resumption of pre-hearing to be held at the offices of the Financial Services Commission.
The issue of the suspension of interest is deferred to the discretion of the hearing arbitrator.
The issue of expenses is deferred to the discretion of the hearing arbitrator.

CHRONOLOGY OF PROCEEDINGS:

On April 23, 2008, the Report of Mediator was issued in respect of Mr. Choudry’s claim.
On May 5, 2008, Mr. Choudry applied for Arbitration at the Commission. His Application for Arbitration was received by the Commission on May 8, 2008.
On December 17, 2008, an arbitrator adjourned the pre-hearing discussion to January 16, 2009.
On February 12, 2009, Mr. Choudry requested a further adjournment of the pre-hearing to February 24, 2009.
On February 24, 2009, a pre-hearing discussion was held before me at the Commission’s offices. Mr. Choudry participated. The parties agreed to the issues for arbitration, provided lists of witnesses and scheduled the hearing for four days commencing January 4, 2010. My pre-hearing letter dated February 24, 2009, does not indicate that either I or Mr. Choudry’s representative had concerns about his capacity to participate in the arbitration process.
On November 26, 2009, Gary Mazin, Mr. Choudry’s representative, wrote to the Commission advising that he was seeking an adjournment of the hearing scheduled to commence on January 4, 2010. The Commission received the letter and its enclosures on December 3, 2009. Enclosed was a letter to State Farm’s representative advising that the adjournment was being sought as Mr. Choudry’s representative believed it might be necessary to have a litigation guardian appointed.
On December 4, 2009, Mr. Choudry’s representative provided a list of witnesses he intended to call at the hearing. A second letter on that date enclosed a medical report which Mr. Choudry was seeking to have admitted at the hearing.
On December 28, 2009, State Farm confirmed that it consented to the adjournment.
On December 29, 2010, the Adjournment Officer granted the adjournment to October 18, 19, 20 and 21, 2010 on the basis that a request was being made to appoint a litigation guardian.
On August 23, 2010, State Farm’s representative wrote to Mr. Choudry’s representative requesting a status report.
On September 14, 2010, State Farm requested a resumption of the pre-hearing to deal with the issue of a further adjournment.
On September 15, 2010, Mr. Choudry’s representative responded advising that he had recently assumed carriage of the file. He further advised that due to “communication problems” the firm had only recently been able to address the issue of having a litigation guardian appointed and it might not be possible to complete the process prior to the hearing date.
On September 30, 2010, State Farm wrote advising it would not consent to a further adjournment on the basis that Mr. Choudry’s representative had had ample time to commence the process of obtaining the appointment of a litigation guardian and had failed to do so.
On October 5, 2010, a resumption of pre-hearing was convened before me by teleconference. I found the firm’s explanation for its failure to commence the process of having a litigation guardian appointed inadequate but granted the further adjournment on the basis that an adjudicator has an obligation to “give deference to counsel’s opinion that his or her client lacks the capacity to instruct.” I ordered that:

… on or before October 19, 2010, the firm of Mazin Rooz Mazin shall provide evidence in writing that it has commenced proceedings in the Superior Court of Ontario seeking an order appointing a litigation guardian or in the alternative the firm of Mazin Rooz Mazin concedes that their client has capacity and the hearing may proceed.

I scheduled a further resumption of pre-hearing on December 1, 2010 at the Commission’s offices and indicated I would deal with State Farm’s motions for its expenses and a suspension of any interest to which Mr. Choudry might be entitled provided State Farm served and filed its motion record on or before November 19, 2010.
On December 1, 2010, I heard the motions of Mr. Choudry and State Farm. The resumption of pre-hearing did not occur due to the time it took to argue the motions. State Farm sought its expenses in respect of the pre-hearing as neither Mr. Choudry nor his proposed personal representative attended.
On December 2, 2010, I wrote to the parties confirming that due to the protracted nature of the argument on the motions the resumption of pre-hearing did not occur. As a consequence, I declined to order expenses in respect of the resumption of pre-hearing. However, I ordered the further adjournment of the hearing to September 19, 20, 21 and 22, 2011 be peremptory to Mr. Choudry on the basis that the previous adjournments had been necessitated by the failure of the firm of Mazin Rooz Mazin to take timely steps to deal with its concerns regarding its client’s capacity. If I determined that Mr. Choudry could proceed to arbitration, a further resumption of the pre-hearing was scheduled for January 14, 2011.
On December 10, 2010, I advised the parties that as my decision would not be released by January 14, 2011, the resumption of Pre-hearing, if necessary, would be rescheduled following the release of this decision.

EVIDENCE AND ANALYSIS:

Capacity Issue:

In December 2009, Mr. Choudry’s representative, the law firm of Mazin Rooz Mazin, obtained an adjournment of the hearing scheduled to commence on January 4, 2010 on the basis that it was seeking the appointment of a litigation guardian. The hearing was rescheduled to commence on October 18, 2010. The firm failed to bring the application for a litigation guardian and obtained a further adjournment of the hearing to September 19, 20, 21 and 22, 2011.

On October 5, 2010, I ordered Mazin Rooz Mazin to either bring its application for the appointment of a litigation guardian or advise State Farm and the Commission that it was satisfied that Mr. Choudry had capacity to instruct them and the matter could proceed to hearing. However, Mazin Rooz Mazin chose to bring a motion pursuant to Rule 10 seeking the appointment of Saira Tabassum, Mr. Choudry’s wife as litigation guardian. In support of its motion it submitted the affidavits of Saira Tabassum and Miriam Yosowich, a student-at-law employed by Mazin Rooz Mazin.

Ms. Tabassum deposed that: “The Applicant, Sarfraz A. Choudry has exhibited signs of mental difficulty during the course of these proceedings.” She went on to state that she was prepared to act as her husband’s litigation guardian and that she believed herself to be a suitable guardian. Ms. Tabassum stated that she was aware that she might be required to pay any expenses awarded in the proceedings personally.²

Ms. Yosowich stated:

From my personal experience in dealing with the Applicant I know that the Applicant suffers from occasional loss of memory and problems with controlling mood.

From my personal experience in dealing with the Applicant I know that the Applicant easily forgets things such as directions, appointments, instructions etc., making it very difficult to obtain and give instructions. For example, on being asked regarding a particular medical examination that the Applicant had attended earlier in the year, he could not recall the location, date or the name of the facility he had attended, making obtaining the results extremely difficult and time-consuming.³

Attached to Ms. Yosowich’s affidavit as exhibits were the medical reports of Dr. W. Pruzanski, a specialist in internal medicine (rheumatology and clinical immunology), dated March 23, 2007 and Dr. G. Gayah, a chiropractor, dated November 23, 2006.

Dr. Pruzanski noted that Mr. Choudry complained of headaches which cause him to become “dizzy, occasionally nauseated and a few times he vomited.” Dr. Pruzanski opined that:

…this patient sustained a marked musculoligamentous injury directed to his neck, lumbar spine and right shoulder. I cannot exclude the possibility that there is injury to the tendineal system of the right shoulder and this has to be investigated further. About 4 months passed by since the accident, therefore, we still cannot call his condition chronic. However, further investigation is necessary.

It is definitely possible that he sustained injury to the right TMJ.⁴

Dr. Gayah stated in his prognosis: “The patient’s current prognosis is guarded due to the severity of multiple site injuries including severe headaches. Decrease activities of daily living, care giving, housekeeping and occupation.”⁵

Mazin Rooz and Mazin submits that the medical evidence together with Ms. Yosowich’s observations and those of his wife require that Ms. Tabassum be appointed Mr. Choudry’s litigation guardian pursuant to Rule 10 of the Dispute Resolution Practice Code (“DRPC”).

State Farm submits that there is no evidence that Mr. Choudry does not have the capacity to understand the nature of the proceedings and is able to instruct counsel.

Rule 10.1 of the Code provides:

Subject to Rule 10.2, a party to a mediation, settlement discussion, neutral evaluation or proceeding is presumed to have the mental capacity to manage his or her property, appoint and instruct a representative, and conduct his or her own case.

Rule 10.2 excludes persons who have been declared mentally incapable, within the meaning of Sections 6 or 45 of the Substitute Decisions Act, 1992, (“SDA”) from the presumption of capacity set out in Rule 10.1. Rule 10.3 provides for either party to request a hearing on a preliminary issue to determine whether a party has the capacity to proceed in the dispute resolution process.

Rule 10.5 provides:

Where an adjudicator is not satisfied that a party has the mental capacity to proceed in the dispute resolution process, and there is no attorney or person such as described in Rule 10.3(b) and (c), the adjudicator may appoint a spouse, same sex partner or near relative of the party to act on the party’s behalf if that person, in the adjudicator’s opinion, is suitable, willing and able to proceed in the dispute resolution process and to receive and administer statutory accident benefits on behalf of the party who has exhibited signs of mental difficulty. The adjudicator may place such conditions or restrictions upon appointments pursuant to this section, as the adjudicator considers reasonable and necessary to protect the interests of the person exhibiting mental difficulty, the other parties to the proceeding and the dispute resolution process.

I find the medical evidence appended to Ms. Yosowich’s affidavit to have minimal probative value. Both Dr. Pruzanski and Dr. Gayah refer to headaches. There is no recommendation for either psychological or neurological assessments to investigate the headaches. There is no suggestion in either report that Mr. Choudry may not have the capacity to manage his affairs. As well, although the reports were both proximate to the date of the accident they were written years prior to Mr. Mazin’s request for an adjournment on the basis a litigation guardian may be required.⁶ Therefore, I find there is no temporal connection between the reports and the capacity issue.

On the basis of the foregoing, I place no weight on either the report of Dr. Pruzanski or Dr. Gayah.

I had an opportunity to observe Mr. Choudry at the pre-hearing on February 24, 2009. In my letter of that date, I do not express any concern that Mr. Choudry might be exhibiting signs of mental difficulty.

Ms. Tabassum restricts her observations to a recitation of the wording of Rule 10: “The Applicant, Sarfraz A. Choudry has exhibited signs of mental difficulty during the course of these proceedings.” She provides no examples of the signs she observed. She provides no examples of circumstances where Mr. Choudry has been unable to manage his financial affairs since the accident. I would have expected a wife to have a much more intimate knowledge of the behavioural signs of mental difficulty and to have set them out for consideration. I find her affidavit of no assistance in determining whether Mr. Choudry requires someone to represent him in these proceedings.

Ms. Yosowich provides some insight into what the mental difficulties might be. She provided an example of Mr. Choudry forgetting the details of a medical appointment earlier in the year. Ms. Yosowich provided no details regarding the lapse of time from the appointment to the date she enquired about it. Applicants frequently are unable to recall the specifics of medical appointments often because there have been significant numbers of them and distinguishing between the various assessments is difficult. Such lapses are human and not signs of incapacity. Ms. Yosowich suggests she observed Mr. Choudry having “problems with controlling mood.” She provides no detail. I cannot determine whether Mr. Choudry exhibits behaviour which would lead to a conclusion he is not sufficiently in control of his mental faculties to manage his affairs.

I find that I have no authority to appoint a litigation guardian. Such appointments are within the sole purview of the Courts. However, an adjudicator has authority to appoint someone “to act on the party’s behalf” pursuant to Rule 10.4 of the Code and I will make my determination based on that authority.

Neither Ms. Yosowich’s nor Ms. Tabassum’s affidavits provide me with evidence which satisfies me that Mr. Choudry is suffering from “mental difficulties” such that the presumption that he has the capacity to manage his property, appoint and instruct a representative, and conduct his own case is rebutted. Therefore, I find that Mr. Choudry is capable of acting on his own behalf in these proceedings.

Dismissal of Mr. Choudry’s Application:

State Farm submits that the failure to bring an application for the appointment of a litigation guardian or to comply with my order to provide evidence that it had commenced an application by October 19, 2010 should result in the dismissal of Mr. Choudry’s claim.

Rule 68 of the Code provides for the dismissal of a proceeding without a hearing where it is frivolous, vexatious or is commenced in bad faith. The delay has been caused by Mr. Choudry’s representative’s concerns regarding Mr. Choudry’s capacity. I find that this issue could not properly form a basis for my finding that Mr. Choudry’s claim is either frivolous or vexatious. Further, there is nothing to suggest that Mr. Choudry has commenced this proceeding in bad faith. Therefore, Mr. Choudry may proceed to hearing.

Suspension of Interest:

I find that the issue of suspending interest is best dealt with by the hearing arbitrator in the context of a finding that a payment of a benefit to which Mr. Choudry is entitled is overdue pursuant to subsection 46(2) of the Schedule.

Resumption of Pre-hearing:

As Mr. Choudry has not attended any of the proceedings since February 2009 and there is a need to deal with various issues, I find that an in-person resumption of Pre-hearing is required. I believe it is important that both Mr. Choudry and State Farm’s representative be in attendance.

EXPENSES:

The issue of expenses of this preliminary issue hearing is deferred to the discretion of the hearing arbitrator.

January 12, 2011

Denise Ashby Arbitrator

Date