Intact Insurance Company v. Margie Bateman, 2014 ONFSCDRS 14

Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2014 ONFSCDRS 14

Appeal P13-00039A

OFFICE OF THE DIRECTOR OF ARBITRATIONS

INTACT INSURANCE COMPANY

Appellant

and

MARGIE BATEMAN

Respondent

BEFORE:

Delegate Lawrence Blackman

REPRESENTATIVES:

Ms. Deborah G. Neilson for the Appellant, Intact Insurance Company

Mr. Gordon Good for the Respondent, Ms. Margie Bateman

HEARING DATE:

January 20, 2014. The decision with reasons was provided orally the same day, with full written reasons to follow.

APPEAL ORDER

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

1. Pursuant to Rules 50.2 and 51.2(c) of the Dispute Resolution Practice Code (Fourth Edition – Updated August 2011), this appeal from the Arbitrator’s November 26, 2013 motion decision is rejected. Accordingly, I decline to exercise my discretion pursuant to subsection 283(6) of the Insurance Act to stay the Arbitrator’s decision.

2. If the parties are unable to agree on the legal expenses of this appeal, an expense hearing shall be requested within thirty days of the date of my oral decision, as set out within.

January 27, 2014

Lawrence Blackman Director’s Delegate

Date

REASONS FOR DECISION

I. NATURE OF THE APPEAL

The Respondent, Ms. Margie Bateman, was injured in a February 14, 1996 motor vehicle accident. As a result, she applied for statutory accident benefits pursuant to the Schedule¹ from her first-party automobile insurer which, at the time, was Zurich Insurance Company but is now the Appellant, Intact Insurance Company.

The parties dispute the Respondent’s benefit entitlement, including loss of earning capacity benefits (“LECBs”), medical/rehabilitation, attendant care and housekeeping benefits, as well as a special award claimed pursuant to subsection 282(10) of the Insurance Act, R.S.O. 1990, c. I.8, as amended.

On August 17, 2010, the Appellant received the Respondent’s Application for Mediation. Mediation, held November 2, 2011, was unsuccessful in resolving the issues in dispute.

The Commission received the Respondent’s Application for Arbitration in January 2012. Rule 32 of the Dispute Resolution Practice Code (Fourth Edition – Updated August 2011), (the “Code”), mandates that at least ten days before the pre-hearing discussion the parties have, in part, exchanged the documents identified in the Application for Arbitration and the Response, established a reasonable time frame for the exchange of any remaining documents, filed a list of outstanding document requests and identified any disputed items.

The parties’ compliance with Rule 32 allows the pre-hearing arbitrator to more expeditiously and cost-effectively, under Rule 33.1(c) of the Code, decide any disputes relating to the identification and exchange of documents, make orders and set time lines for the exchange of outstanding documents. The Commission’s time lines in the Code state that dates for the arbitration pre-hearing will be available within six to eight weeks from the registration of a completed Application and that dates for an oral arbitration hearing will be available within four to six months of the conclusion of the pre-hearing discussion.

The pre-hearing was held before Arbitrator Alves (the “Arbitrator”) on August 9, 2012. The Arbitrator confirmed the substantive issues in dispute and set an eight-day hearing for March 2013. The pre-hearing was to resume on September 28, 2012, allowing the parties to sort out their production disputes in the interim.

At the resumption, procedural issues remained outstanding, including whether the Appellant’s accident benefits file was to be produced. Oral submissions were received at the resumption, and on two further occasions. Written submissions were received by February 20, 2013. The Arbitrator’s March 6, 2013 letter decision determined non-production preliminary procedural issues.

Additional submissions were then received by March 14, 2013. In the interim, the Arbitrator adjourned the March 2013 arbitration hearing to January 28, 2014. The Arbitrator released her production decision on November 26, 2013. The Arbitrator held:

1. The Appellant was to produce, by December 18, 2013, its complete file from February 14, 1996 to August 17, 2010, with the exceptions noted. August 17, 2010 was the date the Appellant received the Respondent’s second Application for Mediation and the date on which the Arbitrator, citing arbitration case law,² held that litigation privilege could reasonably be said to attach. The Arbitrator noted that the Appellant retained its present counsel on September 2, 2010, shortly after the August 2010 Application for Mediation.

Exempted from production were items #20 (reserve information) and #21 (legal opinion). Modified production was ordered regarding manuals, surveillance and contact information for file handlers. The Arbitrator set out a page, single-spaced, of items identified either generically or individually that were to be specifically produced.

2. Citing Dyczok and Wawanesa Mutual Insurance Company, (FSCO A02-000766, August 26, 2003), the Arbitrator found that extraordinary circumstances warranted the Appellant producing an affidavit of documents. These circumstances, where the Respondent had been seeking production of the Appellant’s file since 1998, included:

• Evidence that the Appellant was missing documentation, there being a notation in the Appellant’s file that four fifths of its file was missing;

• The Appellant having two file numbers and the Appellant having neglected or having refused to confirm that both files had been produced;

• The absence of key documents in what the Appellant had produced, the Respondent having listed 45 documents she received in February 2013 for the first time;

• The absence of meaningful responses by the Appellant to the Respondent’s requests for information and documentation; and,

• the manner in which the Appellant had claimed privilege

3. The Appellant was to deliver, by December 18, 2013, an Affidavit of Documents, as particularized by the Arbitrator, restricted to documents that came into existence on or before August 17, 2010. The Arbitrator stated that the Appellant had set out 39 groups of documents over which it claimed solicitor-client, litigation and/or settlement privilege. Rather than producing the documents and redacting the material for which privilege was claimed, the Appellant had withheld entire documents, making it difficult for the Respondent and the Arbitrator to determine whether privilege was legitimately claimed.

The Respondent had two days, until December 20, 2013, to challenge any claim of privilege made by the Appellant. The Appellant subsequently had until December 23, 2013 to file with the Commission a copy of each challenged document. The Arbitrator would then, based on the arguments articulated by the Appellant in its Affidavit of Documents and the Respondent’s submissions, determine what further, if any, documents the Appellant should produce. The documents not ordered produced would be sealed.

4. The Appellant had refused to make those persons who had carriage of its file available to give evidence, or to provide their contact information. Holding that there was no property in witnesses, the Arbitrator ordered that by December 5, 2013 the Appellant provide contact information, as specified, for 12 individuals, exempting two individuals the Arbitrator found had not adjusted the file.

5. The Appellant was to provide the 48-page medical summary it prepared for a psychologist who was to do a psycho-vocational assessment of the Respondent.

6. The Appellant was to produce those directives or memoranda it used to adjust the Respondent’s benefits claim, as they were relevant. The Arbitrator was not persuaded of the relevance of the manuals sought to be produced.

7. Citing Uka and Aviva Canada Inc., (FSCO P08-00036, July 16, 2009) and Mamaca (Litigation Guardian of) v. Coseco Insurance Co., 2007 CanLII 54963 (ON SC), [2007] O.J. No. 4899, the Arbitrator was not persuaded she had authority to order production of reserve information.

8. The Respondent had sought production of all surveillance particulars from the February 14, 1996 accident to present. The Respondent had a July 31, 2003 surveillance report. It had not yet determined if it would be relying on the report. Applying Rule 40.1 of the Code, the Arbitrator ordered that by December 5, 2013 the Appellant was to determine whether it intended to rely on any of its surveillance or investigative evidence and advise the Respondent of its position. If the Appellant intended to rely on any portion of the evidence, it was to provide copies of all of the surveillance and investigative evidence in its possession by December 18, 2013.

The Appellant’s December 3, 2013 letter sought clarification from the Arbitrator regarding her order. The Respondent responded December 9, 2013. In part, the Appellant asked for clarification of her order regarding privilege. On the one hand, the Arbitrator had issued a production order to August 17, 2010. On the other hand, the Arbitrator had ruled that reserve information and legal opinions were not to be produced and an Affidavit of Documents was to be provided upon which privilege would be determined. It was not clear whether the items over which the Appellant had claimed privilege were to be presently produced.

The Arbitrator’s December 20, 2013 letter clarified that the cost of obtaining all productions ordered produced would be at the Appellant’s expense, unless waived by the Respondent. The order for production of log notes included those in the possession of third parties. Production of cheques included those benefits not in dispute in this arbitration. Otherwise, the Arbitrator stated “I refer you to the decision.”

II. SHOULD THIS APPEAL FROM A PRELIMINARY OR INTERIM ARBITRATION ORDER BE ACCEPTED?

The Appellant’s December 18, 2013 Notice of Appeal sought leave that this appeal from a preliminary or interim arbitration order be accepted. The Appellant also sought a stay of the Arbitrator’s November 26, 2013 order.

Rule 50.2 of the Code provides that a party may not appeal a preliminary or interim order of an arbitrator until all of the issues in dispute have been finally decided, unless ordered otherwise. Rule 51.2(c) states that an appeal may be rejected if it is from a preliminary or interim order that does not finally decide the issues in dispute.

Delegate Makepeace, in Allstate Insurance Company of Canada and Torok, (FSCO P01-00021, May 29, 2001), held that the purpose of Rule 50.2 of the Code is to:

… facilitate the most cost-effective resolution of disputes by minimizing the time and money spent on procedural or collateral matters. The decision whether to hear an appeal of a preliminary order is discretionary … the over-arching principle guiding the exercise of the discretion is that the rule “should be broadly interpreted to produce the quickest, most just and least expensive resolution of the dispute.” The criteria to be considered include the apparent strength of the appeal, the importance or novelty of the issue raised, and whether rejecting the appeal or hearing it will prejudice either party.

Subsection 283(6) of the Insurance Act provides that an appeal does not stay the order of an

arbitrator, unless decided otherwise. In Guardian Insurance Company of Canada and Armstrong,

(FSCO P00-00037, July 20, 2000), Delegate McMahon adopted the following criteria in determining whether a stay should be granted:

1. The bona fides of the appeal;

2. The substance of the grounds for appeal; and,

3. The hardship to the respective parties if the stay is granted or refused.

Endeavours were made to have an appeal preliminary issue teleconference with both parties the beginning of January 2014, given that the arbitration hearing was scheduled to begin the end of the month. Due to the unavailability of the Respondent’s counsel to participate in a telephone conference call until January 20, 2014, oral submissions were received on the that date.

The Appellant submits that the Arbitrator erred in her November 26, 2013 decision in:

1. Failing to accept the Appellant’s evidence regarding the privilege claimed and ordering production of documents for which privilege was claimed or that pertained to reserves.
2. Ordering production of the entire accident benefits file rather than those documents relevant to the issues in arbitration.
3. Ordering an Affidavit of Documents as well as an adjuster’s and log note record.
4. Ordering production of copies of cheques of benefits that are not in issue.

The Appellant asks that the Arbitrator’s order be replaced by an order:

1. It produce its complete accident benefits file from February 14, 1996 to August 17, 2010 except for those documents over which privilege is claimed or that pertain to reserves.
2. It not prepare an adjuster’s and log note record indicating what notes were received and have not been provided.
3. It produce copies only of cheques for the medical, rehabilitation, attendant care and housekeeping benefits claimed in the arbitration.
4. Its Affidavit of Documents lists only those documents relevant to the arbitration rather than all Accident Benefits documents.

The Appellant cites Primmum Insurance Co. and Rajasekaram, (FSCO P12-00034, December 4, 2012), as to the following applicable criteria for whether to accept an appeal from a preliminary or interim order. It submits that it need not meet all of the criteria for its appeal to be accepted.

1. The Apparent Strength of the Appeal

The Appellant states that the Arbitrator failed to clarify whether her order requires production of all privileged and/or reserve documentation up to August 17, 2010. Therefore, the Appellant submits that it must now produce all such documentation, other than that expressly excepted in the Arbitrator’s order. The Appellant argues that production of privileged documents is contrary to subsection 5(2) of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22 (the “SPPA”) and Rule 39.3(a) of the Code, as overwhelmingly supported by case law.

At page 8 of her submissions, the Respondent submits that the Appellant has misinterpreted the Arbitrator’s order, believing it must disclose documents over which it claims privilege. The Respondent states, at page 7, that the “Arbitrator did not order disclosure of privileged documents, but rather ordered production of an affidavit of documents.” Documents for which privilege is claimed are to be included in the Affidavit of Documents with sufficient description to identify the document and whether privilege should attach. That, the Respondent argues, is within the Tribunal’s power, as set out in Dyczok. The Respondent further submits that the Arbitrator held that reserve information was to be redacted from the disclosures.

The Appellant, in its companion Application for Variation/Revocation, stated, by letter dated January 15, 2014, that “in light of the clarification of the Arbitrator dated December 20, 2013,” it was withdrawing its Application for Variation/Revocation. In oral submissions, the Appellant stated that if my decision specifically noted the Respondent’s concession and that I am relying on her concession that the Arbitrator has not presently ordered production of documentation where privilege or reserve information is claimed, then the Appellant’s concerns regarding that part of the appeal have been met. Accordingly, the Arbitrator will decide privilege and reserve issues pertaining to specific documents upon delivery of an Affidavit of Documents and the Respondent’s further submissions.

Given the Respondent’s concession, upon which I rely, I am not persuaded as to the strength of the primary focus of this appeal − the alleged error of law regarding privilege. Nor am I persuaded as to the strength of the remaining grounds of appeal, as discussed below.

2. The Importance or Novelty of the Issues Raised

The Appellant cites the Court of Appeal in Pritchard v. Ontario Human Rights Commission et al., 2003 CanLII 8701 (ON CA), 63 O.R. (3d) 97, that solicitor-client privilege is a “fundamental civil and legal right.” The Appellant further cites Delisser v. State Farm Mutual Automobile Insurance Company 2004 CanLII 13931 (ON SC), [2004] O.J. No. 1399, that statements made in the course of mediation should be entitled to absolute privilege. The Appellant submits that, therefore, questions of legal privilege are of extreme importance. That issue, however, has been rendered moot by the Respondent’s concession.

The Appellant cites Allstate Insurance Company of Canada and Rama, (FSCO P07-00033, July 16, 2009), where Delegate Evans allowed an appeal regarding reserve information. In Security National Insurance Co./Monnex Insurance Mgmt. Inc. and Morgan, (FSCO P07-00002, October 29, 2007), Delegate Evans varied the arbitration surveillance evidence production order. In addition, the Appellant submits that the Arbitrator’s decision conflicts with Pantelidis and Certas Direct Insurance Company, (FSCO A01-001126, January 25, 2002), where, in the circumstances of that case, I saw no need for the insurer to provide an affidavit of documents.

The Appellant argues that if leave is not granted to accept this appeal, the reputation of justice will be brought into disrepute. It notes that leave to appeal has been granted where there was a dispute over an order for production of privileged documents.

The Respondent submits that the Appellant has failed to raise any novel or important issue. As the Arbitrator noted, requests for an affidavit of documents have been considered before and the Commission has determined that it is vested with authority to order such production.

The Respondent further argues that the Arbitrator noted the extraordinary circumstances in this case, circumstances attributable to the Appellant itself. The Respondent submits that the Appellant has provided no basis to counter the Arbitrator’s findings or any argument that the circumstances are not extraordinary such as to warrant an Affidavit of Documents.

I agree that the Arbitrator acknowledged that ordering an Affidavit of Documents was restricted to “extraordinary circumstances.” The Arbitrator set out those extraordinary circumstances. The Appellant does not dispute those extraordinary circumstances in its Notice of Appeal, reply or oral submissions. While I was providing my oral decision, the Appellant broke in to say that it intended to provide those submissions once the appeal was accepted. The time to make submissions on the strength of the appeal, however, brief, as a ground upon which the appeal should be accepted is before, not during or after that preliminary appeal decision.

Privilege is important. That does not mean, however, that every preliminary or interim arbitration decision entailing a claim of privilege is entitled to be appealed. While there may have been prior appeal decisions on a specific preliminary issue, that does not mean that an appeal from every arbitration decision on the same issue must be received. Rather, the intent of Rules 50.2 and 51.2(c) of the Code and the case law as in Torok is that accepting appeals from preliminary or interim arbitration orders is to be the exception in this dispute system that was established as a meaningfully expeditious, cost-efficient and simplified alternative to the courts.

I am not persuaded that the Arbitrator’s fact based exercise of discretion raises issues of such importance or novelty warranting setting aside the general rule that a party may not appeal a preliminary or interim order of an arbitrator until all of the issues in dispute have been finally decided. Given the Respondent’s concession that the Appellant’s claims of privilege and reserves are still to be determined, now seventeen months or more after the issue was raised, I am not persuaded that the administration of justice will be brought into disrepute by rejecting an appeal that will add even further delay, expense and complication.

I am persuaded that accepting this appeal will not advance the administration of justice.

3. Whether Rejecting the Appeal will Prejudice Either Party

The Appellant argues that the Respondent’s alleged hardship is contrary to the eleven years it took her to apply for arbitration.

The Appellant further submits that the $10,973.77 in attendant care benefits claimed covers the period 1996 to 2006 and that there is no issue for present attendant care. It argues that these claimed expenses are covered by the caregiver expenses it has already paid.

The Appellant argues that only the preliminary LECB issues (including whether the Respondent elected to receive LECBs and whether she received an LECB offer in 2001) should proceed on January 28, 2014. Once those issues are determined, the issue of LECB quantum should easily settle. The Appellant states that, in the interim, it is paying the Respondent other disability benefits weekly and, hence, there is no concern over any hardship the Respondent may have resulting from the arbitration hearing being delayed.

The Respondent submits that the Arbitrator’s March 2013 order determined that the issue of whether the Respondent was entitled to an LECB should be determined as a substantive issue at the main hearing along with the other disputed benefit claims. The Respondent argues:

• Accepting this appeal would result in a long adjournment of the arbitration hearing, to the Respondent’s prejudice and great hardship;

• The Respondent is presently receiving weekly benefits of $185. The Respondent is entitled to increased benefits based on the Appellant’s own calculations; and,

• The Appellant has indicated its intention to cease payment of benefits immediately for reasons related to an insurer’s medical examination (“IME”). The Appellant responds that its requested IME and/or Form 1, Assessment of Attendant Care Needs Form, pertain to present day attendant care needs and not those in dispute in this arbitration.

I find the argument that the disputed attendant care benefits are seven years old does not support the arbitration hearing being further delayed. Whether the Respondent unduly waited to bring these disputes to resolution, it is now more than two years since she applied for arbitration, far longer to reach a hearing than provided for under the Commission’s time lines. The suggestion that the January 28, 2014 hearing be limited to preliminary LECB issues would, through the back door, overturn the Arbitrator’s March 2013 decision, that has not been appealed.

I am persuaded that the prejudice to the Respondent should this appeal be accepted, adding unwarranted delay, complication and expense, is greater than any prejudice to the Appellant in rejecting the appeal, especially given the Respondent’s concession that privilege and reserve issue regarding specific documents are still to be determined by the Arbitrator.

4. The Preference of the Parties

As cited by the Respondent, Allstate Insurance Company of Canada and Al-Obaidi, (FSCO P99-00009, May 2, 2000), states that the preference of the parties is an important factor. In this case,

the parties disagree on whether this appeal should be accepted.

5. Whether the Arbitration Decision Departs from Prior Cases

I agree with the Respondent that the Arbitrator’s decision is consistent with Dyczok that an arbitrator is vested with the authority to order production of an affidavit of documents. The Arbitrator’s decision is also consistent with Campeau and Liberty Mutual Insurance Company, (FSCO A00-000522, March 12, 2001).

Rule 1.1 of the Code provides that the Rules are to be broadly interpreted to produce the quickest, most just and least expensive resolution of the dispute. Campeau noted the broad strokes approach taken by the Commission regarding production of an insured person’s clinical notes and records, setting as a general rule production of an insured’s clinical notes and records from one year pre-accident, subject to submissions that the scope of production should be broadened or narrowed:

… medical entries may note abortions, extra-marital affairs and a myriad of other extremely private matters. The relevance of these matters to a claim such as a soft-tissue disability, especially without any alleged emotional component, may be questioned. Nevertheless, without even a bald allegation of a causation issue, insurers are routinely provided with the entire clinical notes and records of an applicant’s medical practitioners from the standard period of one year prior to the motor vehicle accident, without any restriction to those entries which the applicant finds relevant.

Campeau, noting the similar prima facie relevance of an insurer’s accident benefits file, took a similar broad brush approach to production of the file up to the date of mediation, subject to submissions as to why the scope of production should be expanded or narrowed.

Rule 5.4(1)(c) of the SPPA provides that a Tribunal may, at any stage before the hearing is completed, make orders for the exchange of documents. Rule 5.4(c) excepts orders requiring the disclosure of privileged information. Rule 15(2) of the SPPA provides that nothing is admissible in a hearing that is inadmissible in a court by reason of privilege under the law of evidence. The Ontario Court of Appeal, in General Accident Assurance Co. v. Chrusz et al., 1999 CanLII 7320 (ON CA), [1999] 45 O.R. (3d) 321, held that the onus is on the party asserting the privilege to establish the evidentiary basis for the privilege. The Appellant seemingly objects to the Arbitrator allowing it yet another opportunity to establish an evidentiary basis for the privilege it claims for individual documents.

6. Whether Rejecting or Hearing the Appeal would provide the Quickest, Most Just and Least Expensive Way of Disposing of the Issues between the Parties.

The Appellant states that subsection 15(1) of the SPPA limits documentary evidence at a hearing to that which is relevant to the subject-matter of the proceeding. Rule 32.2 of the Code requires the exchange of documents that are “reasonably necessary to determine the issues being arbitrated.” Rule 32.3 provides, in part, that an arbitrator may at any time order the production of documents considered “relevant to the determination of the issues in the arbitration.”

The Appellant argues that the Arbitrator has incorporated into arbitration a discovery process, including an Affidavit of Documents listing every document in its possession regardless of relevance. Such an order, the Appellant submits, undermines the Commission as an expeditious, less complicated and less expensive alternative to the court system. This appeal, it submits, will discourage parties seeking production of documents not relevant to the issues in a matter with a view to streamlining the arbitration process.

The Appellant submits that the Respondent requested, on March 1, 2013, that the arbitration hearing be adjourned to January 28, 2014. The Arbitrator’s order came eight months after the close of submissions that took months to complete. Nonetheless, the Arbitrator only allowed the Appellant days to comply with her extensive order. The Appellant states that it has incurred 98 hours of staff time, including overtime on weekends, and at least 46 hours of counsel and staff time, to comply with the Arbitrator’s order.

The Respondent argues that dismissing the appeal and the stay request would be the most just, expeditious and least expensive way of disposing of the dispute, rather than suspending its determination for months, at unnecessary further expenditure and time.

The Arbitrator had the advantage of hearing the parties on numerous occasions. Al-Obaidi held:

Arbitrators have considerable options as to the form disclosure should take. In appropriate circumstances, this may involve a selective order, as in Candido, limited to entries related to specified benefits, and giving that party’s lawyer the opportunity to decide which entries meet the criteria. However, this should always be subject to the ultimate discretion of the arbitrator to rule on aspects in relation to which there may be uncertainty, disagreement or concern.”

The Arbitrator made findings of fact. She found that the Appellant had not provided meaningful responses to the Respondent’s requests for information and documentation, it was missing documentation, it had two file numbers, it refused to confirm that both files had been produced and it had not provided key documents it said had been delivered.

The Arbitrator set out the basis for finding that there were extraordinary circumstances supporting her order. The Appellant has not challenged the extraordinary circumstances found by the Arbitrator. In any event, appeals from the order of an arbitrator are limited to questions of law under subsection 283(1) of the Insurance Act.

Deference is owed to first level adjudicators, specifically regarding credibility. It is not the role of an appellate officer to second guess such findings. As stated in Calogero and The Co-operators General Insurance Company, (OIC P-000251, February 13, 1992), the “principle, as generally understood, is one should only interfere in the discretion exercised by the trier of fact if it is so clearly wrong as to amount to an injustice (Elsom v. Elsom, 1989 CanLII 100 (SCC), [1989] 1 S.C.R. 1367) … it is not the Director's function to substitute her assessment for that of the arbitrator.”

As noted in Torok, the key criterion whether to accept an appeal is whether it would result in the quickest, most just and least expensive way of disposing of the issues between the parties. The onus is on an appellant to establish that an appeal from a preliminary or interim order should be accepted. Further, appeals from the order of an arbitrator are limited to errors of law. That another arbitrator would have exercised his or her discretion differently is not sufficient.

As stated, the Respondent concedes that issues regarding privilege and reserve documentation are still to be determined by the Arbitrator. Ordering an Affidavit of Documents in the extraordinary circumstances noted by the Arbitrator was consistent with Dyczok. Ordering production of the Appellant’s accident benefits file to the date of mediation, subject to determination of privilege and reserve issues, was consistent with Campeau.

Accepting this appeal will not bring back the seventeen months these issues have percolated in arbitration submissions and deliberations. Accepting this appeal will not bring back the 144 hours the Appellant says it has spent complying with the Arbitrator’s order. The parties endeavoured to advise me as to the extent of the Appellant’s compliance or lack of compliance with the Arbitrator’s order. That, however, is not the issue before me.

I am not persuaded as to the apparent strength of the appeal, the importance or novelty of the issues raised, that the prejudice in rejecting the appeal is greater to the Appellant than the prejudice to the Respondent in accepting the appeal or that the arbitration decision departs from prior case law.

Accordingly, exercising my discretion pursuant to Rules 50.2 and 51.2(c) of the Code, I reject this appeal. As the appeal has been rejected, the issue of the requested stay of the Arbitrator’s November 26, 2013 decision is moot. However, for completeness, I will briefly address that issue.

III. SHOULD THE REQUESTED STAY BE GRANTED?

The Appellant argued, in support of its stay request, that the likelihood of it being successful on appeal was great given that subsection 5(2) of the SPPA prevents an arbitrator ordering production of privileged documents. The Appellant submits that its privileged documents include e-mails between Zurich’s in-house counsel and its adjuster, internal e-mails and adjuster’s notes setting out settlement strategy and documents.

If the stay were not granted, the Appellant argues that it would suffer irreparable prejudice as the privilege attached to the documents ordered produced would be lost upon production, rendering the appeal moot. To allow these documents to be produced would have “a chilling effect on the communications between insurers and their counsel and on preparation for settlement discussions or mediation.”

As noted, the Respondent concedes that the Arbitrator’s production order excludes documents for which privilege or reserve information is claimed. Disputes in this regard are to be resolved according to the procedure set by the Arbitrator. I am not persuaded that the hardship claimed by the Appellant warrants the exceptional order of a stay of the Arbitrator’s order.

IV. EXPENSES

If the parties are unable to agree on the legal expenses of this appeal, applying the procedure in Rule 79.2 of the Code, an expense hearing shall be requested, within thirty days of the date of my oral decision. The request shall be accompanied by a Bill of Costs describing the expenses claimed, the services received and the costs. Although not stated in my oral decision, it would move matters along if the request was accompanied by written submissions regarding entitlement to and/or the quantum of legal expenses, as are in dispute.

January 27, 2014

Lawrence Blackman Director’s Delegate

Date

Footnotes

1. 1The Statutory Accident Benefits Schedule — Accidents after December 31, 1993 and before November 1, 1996, Ontario Regulation 776/93, as amended.
2. 2Campeau and Liberty Mutual Insurance Company, (FSCO A00-000522, March 12, 2001) and Vaitheeswaran and State Farm Mutual Automobile Insurance Company, (FSCO A09-002295 July 26, 2010).