Licence Appeal Tribunal File Number: 24-008965/AABS
In the matter of an application pursuant to subsection 280(2) of the Insurance Act, RSO 1990, c I.8, in relation to statutory accident benefits.
Between:
Zachary Scandlan
Applicant
and
Primmum Insurance Company
Respondent
PRELIMINARY ISSUE HEARING DECISION AND ORDER
ADJUDICATOR:
Laura Goulet
APPEARANCES:
For the Applicant:
Alicia Stuart, Counsel
For the Respondent:
Jennifer Kiss, Counsel
Heard:
By Way of Written Submissions
OVERVIEW
1Zachary Scandlan (the “applicant”) was involved in an automobile accident on March 24, 2014, and sought benefits pursuant to the Statutory Accident Benefits Schedule – Effective September 1, 2010 (the “Schedule”). The applicant was denied benefits by Primmum Insurance Company (the “respondent”) and applied to the Licence Appeal Tribunal – Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.
PRELIMINARY ISSUE IN DISPUTE
2The preliminary issue to be decided is:
i. Is the applicant barred from proceeding to a hearing by the doctrine of res judicata?
3Added issue:
i. Is the respondent entitled to costs?
4In its submissions, the respondent requested costs pursuant to Rule 19 of the Licence Appeal Tribunal Rules, 2023. Accordingly, this issue is added above.
RESULT
5The applicant is barred from proceeding with his application because the doctrine of issue estoppel applies.
6The respondent is not entitled to costs.
ANALYSIS
Background
7The applicant brought an application on June 27, 2022, (the “2022 application”) to be deemed catastrophically impaired (“CAT”), as well as for medical and rehabilitative benefits (“benefits”), interest, and an award. After a five-day hearing, the Tribunal found, on April 10, 2024, that the applicant was not CAT, that the non-CAT limits had been exhausted, and that he was not entitled to the benefits, the award, or interest. On June 25, 2024, the Tribunal dismissed the applicant’s request for reconsideration. The applicant appealed to the Divisional Court, and a determination is outstanding. On July 19, 2024, the applicant filed the current application (“2024 application”) seeking entitlement to eleven benefits, an award, and interest. Although the 2024 application does not list the issue of CAT, the applicant lists the reason for the denial of most of the benefits as “benefits exhausted,” and the applicant does not make submissions that the benefits are not exhausted.
8The respondent submits that the applicant is barred from proceeding to a hearing by the doctrine of res judicata and abuse of process.
9The decision of Danyluk v. Ainsworth Technologies Inc., 2001 SCC 44 (“Danyluk”) deals with the doctrine of res judicata. The test in Danyluk incorporates issue estoppel, which is a branch of the broader doctrine of res judicata.
The doctrine of issue estoppel
10I find that the doctrine of issue estoppel applies in this case.
11The doctrine of issue estoppel prevents a party from relitigating an issue that has already been decided. The Supreme Court of Canada in Toronto (City) v. C.U.P.E. Local 79, 2003 SCC 63 (“C.U.P.E.)” at para. 23 referred to Danyluk and set out that for issue estoppel to be successfully invoked, three preconditions must be met:
i. The issue must be the same as the one decided in the prior decision;
ii. The prior judicial decision must have been final; and
iii. The parties to both proceedings must be the same, or their privies.
12The respondent submits that the 2022 application and the 2024 application involve the same parties: the applicant and the respondent.
13The respondent submits that until the appeal to the Divisional Court is concluded, the reconsideration decision is applicable to the current application. The respondent also submits that the 2024 application is barred by the doctrine of res judicata as the Tribunal has determined that the applicant is not CAT and there are no further benefits payable as he has exhausted the non-CAT limits. The applicant does not contest that the non-CAT limits have been exhausted.
14The respondent further argues that this is a final decision before the Tribunal and that the non-CAT designation applies to the applicant, pursuant to Danyluk, where the Court stated that “judicial decisions should generally be conclusive of the issues decided unless and until reversed upon appeal.” Accordingly, the respondent submits, the reconsideration decision has not been reversed by the Divisional Court and is applicable.
15The respondent also relies on the Tribunal decision of DT v. Wawanesa Mutual Insurance Company, 2019 CanLII 110124 (ON LAT) (“DT”), where the claimant had brought a second application with respect to benefits and the Minor Injury Guideline (“MIG”), despite these issues already having been decided in a prior decision. The Tribunal held that the prior decision confirmed that the injuries fell within the MIG and therefore the plans in dispute were above the $3,500.00 funding limit and the insurer cannot be found liable to pay for benefits above this amount as long as the MIG determination stood. The respondent submits that, similarly, in this case, the applicant listed all new treatment plans in the 2024 application, however, he has been found not to be CAT by the Tribunal and he has exhausted the $50,000.00 monetary limit available to him.
16The applicant submits that the decision from the 2022 application is not final as it is currently under appeal to the Divisional Court. The applicant submits that res judicata cannot apply when there is an ongoing appeal of the issue. It is the applicant’s position that the 2024 application ought to be tolled (which was refused by the respondent) or stayed pending the decision of the Divisional Court, to avoid a duplicity of proceedings and the potential for incongruent or incompatible decisions. The applicant further submits that dismissing the 2024 application based on res judicata or abuse of process would violate judicial economy, and potentially result in judicial inconsistency, although the applicant does not explain how.
17The applicant refers to the decision of Canada v. MacDonald, 2021 FCA 6 (“MacDonald”), where the Federal Court of Appeal held that “an order or judgment under appeal is not final for the purposes of the doctrine of res judicata.” The Court went on to say that an aspect of finality remains: the court that issued the order or judgment cannot reconsider, suspend, set aside, or vary it. The applicant points out that he has sought relief from the Divisional Court to have the matter reheard by the Tribunal.
18The applicant also relies on the C.U.P.E. decision, which dealt with issue estoppel, where the Supreme Court of Canada held that a “decision is final and binding on the parties only when all available reviews have been exhausted or abandoned.” The applicant submits that since the Tribunal’s reconsideration decision is under appeal, it cannot be said to meet the finality condition for the test of res judicata.
19The applicant further submits that courts retain the power to decline to apply the doctrine of res judicata where doing so would cause injustice.
20In reply, the respondent submits that it is not obligated under the Schedule to agree to enter into a tolling agreement, and that this is irrelevant to this proceeding.
21I find that the C.U.P.E. decision applies to the process at the Tribunal. The Court in C.U.P.E. held that issue estoppel applied because the claimant did not take advantage of the internal review procedure for a statutory review of his appeal. In this case, the applicant requested a reconsideration, which was dismissed. The decision, as it relates to the process at the Tribunal, is final.
22I find that the decision in the 2022 application is final and that the circumstances can be distinguished from the decision in MacDonald, given the language in Danyluk. In Danyluk, at para. 20, the Supreme Court of Canada held that issue estoppel extends to both “constituent issues or material facts necessarily embraced therein.” The Court goes on to say, at para. 24, that “the estoppel extends to the material facts and the conclusions of law or of mixed fact and law (“the questions”) that were necessarily (even if not explicitly) determined in the earlier proceedings.” Further, at para. 54, the Supreme Court held that “[T]he estoppel, in other words, extends to the issues of fact, law, and mixed fact and law that are necessarily bound up with the determination of that “issue” in the prior proceeding.” In this case, I find that the “constituent issues and material facts” in the 2024 application were dealt with in the 2022 application and in the reconsideration, because the 2024 application hinges on the determination of CAT which was denied in the 2022 application under appeal.
23The applicant submits that he filed the 2024 application to preserve the limitation period. Since the benefits in the 2024 application are not payable because the applicant has exhausted the non-CAT limits, it appears that this application was brought in the hope that the Divisional Court sends the 2022 matter back for a new hearing and that the Tribunal changes its finding on CAT. Therefore, while the benefits claimed in the 2024 application were not in dispute in 2022, the “constituent issues and material facts” are the same as those in the 2022 application because they are again contingent on a CAT determination for entitlement, which is a conclusion of law that was decided by the Tribunal in the 2022 application.
24For these reasons, I find that issue estoppel applies to the 2024 application. The 2024 application is contingent on a CAT designation, which has already been decided in the hearing for the 2022 application and the subsequent reconsideration decision, which was final, unless and until the Divisional Court orders a new hearing.
Issue estoppel should not be waived
25The find that issue estoppel should not be waived in this case.
26As set out by the Supreme Court of Canada in C.U.P.E. at para 52, issue estoppel can be waived in the following situations:
i. The first proceeding is tainted by fraud or dishonesty;
ii. Fresh, new, evidence is submitted that was previously unavailable that would conclusively impeach the original results; or
iii. When fairness dictates that the original result should not be binding in the new context.
27The applicant does not argue the first proceeding was tainted by fraud or dishonesty, or that fairness dictates that the original result should not be binding in the new context.
28The applicant submits that there was fresh, new evidence, not previously available to the parties at the time of the initial hearing, that impeaches the original results, which was a major thrust of his request for reconsideration and his grounds for appeal to the Divisional Court. The applicant argues the Tribunal erred in the reconsideration decision in finding that the CAT Addendum Reports (the “reports”) were before the Tribunal in the oral hearing and that the adjudicator decided not to admit the evidence. The applicant further submits that the reports contain fresh, new evidence indicating a decline in his condition, and that evidence is highly relevant to the issue in dispute.
29I disagree that there was fresh, new evidence, not previously available to the parties at the time of the initial hearing, that impeach the original results, because this has also already been decided by the Tribunal. In the reconsideration decision dated June 25, 2024, the Tribunal held that it was not satisfied that the reports constitute evidence that was not before the Tribunal when rendering its decision and it found that the applicant did not show how the reports would likely have affected the result. I find that the applicant is trying to enter the same evidence in this application that was rejected by the Tribunal in the reconsideration of the 2022 application.
30For these reasons, I am not exercising my discretion to waive the doctrine of issue estoppel in this case because I find that the purported fresh, new, evidence cited by the applicant was previously available and considered in the 2022 reconsideration, and the Tribunal found that it would not have changed the outcome.
31While the respondent argues that the filing of the 2024 application constitutes an abuse of process, given my finding on issue estoppel, I do not need to consider this argument.
Costs
32The respondent requests costs in the amount of $1,000.00 pursuant to Rule 19 of the Licence Appeal Tribunal Rules, 2023 (“the Rules”) for having to bring this preliminary issue hearing. The respondent submits that the applicant has acted unreasonably by bringing the 2024 application when he was aware that he has no access to further funding under the Schedule.
33Rule 19.1 of the Rules states that where a party believes that another party in a proceeding has acted unreasonably, frivolously, vexatiously, or in bad faith, that party may make a request to the Tribunal for costs.
34Rule 19.5 of the Rules outlines the relevant factors which should be considered by the Tribunal when determining whether to order costs and the amount of costs to be awarded, which include the seriousness of the misconduct, whether the conduct was in breach of a direction or order issued by the Tribunal, whether or not a party's behaviour interfered with the Tribunal's ability to carry out a fair, efficient, and effective process, prejudice to other parties, and the potential impact an order for costs would have on individuals accessing the Tribunal system. Rule 19.6 allows for a maximum of $1,000.00 for each full day of attendance at a motion, case conference or hearing.
35I find that the respondent does not point to any behaviour on the part of the applicant that is frivolous and vexatious, other than the fact that he brought an application, which he is entitled to do. Even if I were to make a finding that this was an abuse of process, I have considered the applicant’s submissions that he filed the 2024 application to preserve a limitation period and his position that the application ought to be tolled or stayed pending the decision of the Divisional Court. In these circumstances, I am not convinced that the applicant’s actions meet the level of conduct contemplated by Rule 19.1.
36I find that cost awards under Rule 19 are to maintain civility and order during proceedings, to deter conduct that threatens the orderly and civil resolution of an application, and to ensure that the Tribunal’s process and the other participants are respected. They are not to compensate parties for suffering an inconvenience or for the cost of their involvement in a proceeding.
37For these reasons, I find that the respondent has not provided sufficient evidence to satisfy Rule 19.1 and its claim for costs is dismissed.
ORDER
38The applicant is barred from proceeding with his application because the doctrine of issue estoppel applies.
39The respondent is not entitled to costs.
Released: May 27, 2025
Laura Goulet
Adjudicator