Wawanesa Mutual Insurance Company v. Lee-Anne Henderson, 2015 ONFSCDRS 198

Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2015 ONFSCDRS 198

Appeal P15-00048

Appellant

and

Respondent

BEFORE:

Delegate Lawrence Blackman

Mr. Stephen B. Macaulay for the Appellant, Wawanesa Mutual Insurance Company

Ms. Deborah J. Lewis for the Respondent, Ms. Lee-Anne Henderson

By written submissions due September 4, 2015

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

Pursuant to Rules 50.2 and 51.2(c) of the Dispute Resolution Practice Code (Fourth Edition – Updated January 2014), this appeal from Arbitrator Bowles’ July 9, 2015 decision is presently rejected. This is without prejudice to the Appellant renewing this appeal upon all of the issues in dispute in the current arbitration being finally determined, subject to any further or other order of an appellate officer.
Arbitrator Bowles’ July 9, 2015 Order is not stayed.
If the parties cannot agree on the legal expenses of this appeal, either party may request an appeal expense hearing within thirty days of the date of this decision, as set out within.

September 30, 2015

Lawrence Blackman Director’s Delegate

Date

I. NATURE OF THE APPEAL AND BACKGROUND

The Respondent, Ms. Lee-Anne Henderson, was injured in a motor vehicle accident on September 18, 2011. As a result, she applied to her first-party automobile insurer, the Appellant, Wawanesa Mutual Insurance Company, for statutory accident benefits under the 2010 Schedule.¹

In his July 9, 2015 decision, Arbitrator Bowles (the “Arbitrator”) held that the Respondent was entitled to examination expenses for the funding of a Catastrophic Impairment Assessment (“CAT”).

The Appellant seeks leave to appeal the Arbitrator’s July 9, 2015 preliminary order as well as a stay of that decision. The form of the Notice of Appeal states that if an appellant seeks leave to appeal or a stay, the appellant’s reasons “should be as complete as possible.”

The Appellant submits:

The appeal raises a substantive and important issue of law of whether the cost of CAT reports under section 25 of the 2010 Schedule is subject to the section 18 monetary limits. The Arbitrator, the Appellant argues, erred in “fixating” on whether a CAT is a benefit, failing to address what it submits was the central issue of whether the CAT was in connection with any benefit under the 2010 Schedule.
This appeal raises a novel issue. Neither Cook and RBC General Insurance Company, (FSCO P14-00038, May 4, 2015) (under judicial review) nor Guarantee Company of North America and Do, (FSCO P12-00037, October 11, 2013) (upheld on judicial review in The Guarantee Company v. Do, 2015 ONSC 1891) touch upon this issue.
The arbitration hearing scheduled for November 9 to 11, 2015 need not be adjourned as the issue of CAT funding does not affect the determination of the Respondent’s entitlement to other accident benefits.
It is more efficient and cost effective to deal with this isolated appeal issue on its own.
There would be insignificant hardship to the Respondent should the Arbitrator’s order be stayed. The Respondent has already obtained her CAT reports. Any hardship to the Respondent would be compensated by the appropriate interest payable should she be successful on appeal. Coutu and Wawanesa Mutual Insurance Company, (FSCO A01-001446, June 21, 2002), addressing entitlement to interim benefits, held that interest would “in most cases …fairly compensate … for overdue payments.”
The Appellant may not be able to recover payment of the Respondent’s CAT funding should it ultimately be successful on appeal.

The Respondent objects to this appeal being accepted at this time for the following reasons:

The issues in this appeal are not novel, having been addressed in Cook and in Do.
The Appellant can appeal this issue under section 50.2 of the Dispute Resolution Practice Code (Fourth Edition, Updated – January 2014) (the “Code”) after the arbitration has concluded and would suffer no prejudice in so doing.

The Respondent opposes the Arbitrator’s order being stayed on the following basis:

It is now four years since the accident. Her medical and rehabilitation monetary limits were exhausted by September 27, 2013. The CAT interim reports have been received and were provided to the Appellant on August 20, 2015. If the Arbitrator’s Order is stayed, the Respondent does not have the financial means to pay for those reports.

II. ANALYSIS

My August 6, 2015 letter set a time line for the remaining appeal preliminary issue written argument.

I noted Rule 56.5 of the Code that an appeal may be decided in any manner considered appropriate. Subject to the parties’ submissions and the further material filed, in accordance with Rule 1.1, I was of the view that the most expeditious, least costly and most just means of determining whether this appeal should be accepted at this time and, if so, whether to grant the requested stay was by written submissions. I stated that if either party were of the view oral submissions in addition to written submissions were reasonably necessary, they were to advise, with reasons.

No such request was received. In any event, applying Rule 1.1, I am not persuaded that the written submissions provided are insufficient. Any prejudice would be to the Respondent, the Appellant’s reply submissions on the preliminary appeal issues being twice as long as its initial argument.

Rule 51.2(c) of the Code provides that an appeal may be rejected if “it is from a preliminary or interim order that does not finally decide the issues in dispute. In Security National Insurance Co./Monnex Insurance Mgmt. Inc. and Hodges, (FSCO P12-00029, August 13, 2012), I held:

As set out in Allstate Insurance Company of Canada and Tesfay, (FSCO P99-00023, June 21, 1999), Allstate Insurance Company of Canada and Al-Obaidi, (FSCO P99-00009, May 2, 2000) and Allstate Insurance Company of Canada and Torok, (FSCO P01-00021, May 29, 2001), the decision whether to hear an appeal from a preliminary or interim order is discretionary. The relevant criteria include:

(a) the apparent strength of the appeal;

(b) the importance or novelty of the issue(s) raised;

(d) the preference of the parties;

(e) whether the arbitration decision represents a departure from prior cases; and,

(f) whether rejecting or hearing the appeal would provide the quickest, most just and least expensive way of disposing of the issues between the parties.

Delegate Makepeace, in Allstate Insurance Company of Canada and Torok, (FSCO P01-00021, May 29, 2001), held that the purpose of the present 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” …

I find that the most important consideration in determining whether to accept this specific appeal at this time is that I am advised that the main arbitration hearing is scheduled to be heard in six weeks time. The Respondent suggests that this appeal be presently rejected without prejudice to the Appellant resubmitting its appeal once the main arbitration decision is rendered.

I find that avoiding a possible multiplicity of appeals to be, to cite the Appellant, the more efficient and cost effective means of resolving this dispute. Further, the Cook judicial review is still pending. A decision in that case may assist the disposition of this present matter.

I balance the “over-arching principle guiding the exercise of the discretion” noted by Delegate Makepeace with the Appellant’s submissions as to the strength, novelty and importance of its appeal. Accordingly, I am only presently rejecting this appeal from Arbitrator Bowles’ July 9, 2015 decision without prejudice to the Appellant renewing its present appeal upon all of the issues in dispute in the current arbitration being finally determined, subject to any further or other order of an appellate officer.

Turning to the question of the requested stay, subsection 283(6) of the Insurance Act states that an appeal does not stay the arbitrator’s order unless decided otherwise. Therefore, a stay of the order of an arbitrator is the exception, not the rule. In Guardian Insurance Company of Canada and Armstrong, (FSCO P00-00037, July 20, 2000), Delegate McMahon, following Canadian Home Assurance Company and Scavuzzo, (OIC P-000626, May 18, 1992,) adopted the following criteria as to whether a stay should be granted:

The bona fides of the appeal;
The substance of the grounds for appeal; and,
The hardship to the respective parties if the stay is granted or refused.

The Appellant argues against any monetary prejudice to the Respondent should the Arbitrator’s order be stayed. It also argues it may not be able to recover payment of the CAT reports should it ultimately be successful. It is difficult to see how that Appellant can have it both ways.

Delegate Richardson in Scavuzzo addressed the possibility of an insurer being unable to obtain repayment. She cited Digiammatteo v. Leblanc, (1989), 1989 CanLII 4076 (ON CA), 71 O.R. (2d) 130 (C.A.). In that court case, under the Rules of Civil Procedure a stay was automatic, not the exception. Even in that different context, the respondent was applying to have the stay lifted, the Court of Appeal held:

In any event, there is always a risk of non-recovery in any litigation, even when successful, and I can see no reason why all of that risk should fall on the respondent in this case.

The Respondent denied the CAT payment on November 4, 2013. Mediation of the CAT payment issue failed on December 16, 2013. The Commission received the Respondent’s Application for Arbitration on February 19, 2014. It is now some two years that this issue has been in dispute, the matter having had a full adjudication in February and April of this year and the Arbitrator’s decision having been rendered on July 9, 2015.

The introduction to the Code emphasizes that it has created rules for timely, cost-effective and fair dispute resolution services. Heeding that context, I find in this specific case the most relevant consideration to be the respective hardship to the parties if a stay is granted.

I agree with Delegate McMahon in Armstrong that the “fact that a stay is the exception rather than the rule, suggests to me that the drafters of the legislation recognized that the insurer is in a much better position than the insured person to bear the risks inherent in not staying the arbitrator’s order.” I am not persuaded to exercise my discretion under subsection 283(6) of the Insurance Act to stay the Arbitrator’s July 9, 2015 Order.

IV. EXPENSES

If the parties cannot agree on the legal expenses of this appeal, pursuant to Rule 79.1 of the Code either party may request an appeal expense hearing within thirty days of the date of this decision, to be accompanied by a Bill of Costs describing the expenses claimed, the services received and the costs, and submissions on such entitlement and/or quantum expense issues as are in dispute.

September 30, 2015

Lawrence Blackman Director’s Delegate

Date

Footnotes

The Statutory Accident Benefits Schedule — Effective September 1, 2010, O. Reg. 34/10, as amended.