Her Majesty the Queen in right of Ontario as represented by the Minister of Finance representing the Motor Vehicle Accident Claims Fund v. Hanna-Harik et al. [Indexed as: Ontario (Minister of Finance) v. Hanna-Harik]
65 O.R. (3d) 337
[2003] O.J. No. 2413
Docket No. C38294
Court of Appeal for Ontario
Labrosse, Charron and Sharpe JJ.A.
June 18, 2003
Insurance -- Automobile insurance -- Quebec resident injured in accident in Ontario involving non-insured driver - Quebec resident granted judgment in Ontario action for personal injuries but refused payment under Quebec's no-fault compensation scheme -- Quebec resident entitled to payment from Ontario's Motor Vehicle Accident Claims Fund -- If compensation scheme in non-resident's jurisdiction providing Ontario claimants with "substantially similar" recourse to compensation, then non-resident claimant not required to establish right to same relief under law of his or her place of residence -- Motor Vehicle Accident Claims Act, R.S.O. 1990, c. M.41, s. 25(2)
In 1996, Michel Harik and Katia Hanna-Harik, who were Quebec residents, were involved in a motor vehicle accident in Ontario with a non-insured driver. Both successfully claimed damages in an action in Ontario, and Katia also asserted a claim under Quebec's no-fault compensation scheme, under which the Société de l'assurance automobile du Québec (the "Société") determines indemnities for personal injuries arising from motor vehicle accidents. In the Ontario action, which was defended by the Motor Vehicle Accident Claims Fund (the "Fund"), Cunningham J. found that Katia had suffered a debilitating soft-tissue injury and awarded $33,783.68 for non-pecuniary damages plus pre- judgment interest and costs. Michel was awarded $4,391.84 for loss of care, guidance and companionship under the Family Law Act, R.S.O. 1990, c. F.3. In Quebec, Katia's Quebec claim was rejected.
Michel and Katia moved before the motions judge for an order pursuant to s. 7 of the Motor Vehicle Accident Claims Act (the "Act") for payment of the damages awarded in the Ontario action against the uninsured driver. The Fund resisted the motion, arguing that payment should be refused because s. 25(2) of the Act, which governs when payments may be made to a person who ordinarily resides outside of Ontario, provides, among other things, that no payment from the fund shall include "an amount that would not be payable by the law of the jurisdiction in which such person resides". The Fund argued that since Michel and Katia were not entitled to any payment under the Quebec scheme, s. 25(2) precluded any payment to them from the Fund. Manton J. rejected this argument and interpreted s. 25(2) to mean "an amount that may, can or must be paid" rather than as [page338] meaning that there had to be an obligation to pay the sum. Manton J. ordered payment. The Fund appealed.
Held, the appeal should be allowed in part.
The Fund's argument that Michel and Katia had to prove both an entitlement to damages in Ontario and an actual obligation to pay in Quebec should be rejected. Section 25(2) contemplates two stages of analysis. In the first stage, which was not an issue in this case, one must determine whether the claimant is the resident of a jurisdiction "in which recourse of a substantially similar character to that provided by this Act is afforded to residents of Ontario". If the schemes are "substantially similar", one then proceeds to the second stage of the analysis with the exclusion of payments of "an amount that would not be payable under the law of the jurisdiction in which the person resides".
When read in light of the requirement that the law of the place or the claimant's residence provides "substantially similar" relief to Ontario residents, the second stage does not require the claimant to establish a right to precisely the same relief under the law of his or her place of residence. To require a fact-specific inquiry into the precise amounts that would be payable under the law of the place of residence would add levels of procedural and evidential complexity to the determination of claims and undermine the reciprocal and remedial purposes of the scheme. Such an interpretation would be contrary to the presumption against a multiplicity of proceedings, and would unduly complicate a process designed to protect injured motorists vulnerable to accidents caused by uninsured drivers.
Therefore, Manton J. was correct in ordering payment to Katia. However, it was conceded that under Quebec law, Michel had no right corresponding to the Family Law Act and that Manton J. erred in granting Michel an order for the payment of that award from the Fund. Accordingly, the appeal should be allowed in part.
APPEAL from a judgment ordering payment of a judgment pursuant to the Motor Vehicle Accident Claims Act, R.S.O. 1990, c. M.41.
Cases referred to Melanson v. Duncan (Re), 1965 264 (ON SC), [1965] 2 O.R. 812, 52 D.L.R. (2d) 205 (H.C.J.); Young v. Ontario (Minister of Finance) (2002), 2002 49414 (ON SC), 58 O.R. (3d) 284, 24 M.V.R. (4th) 209 (S.C.J.) Statutes referred to Family Law Act, R.S.O. 1990, c. F.3, s. 61 Loi sur l'assurance automobile du Québec, L.R.Q., ch. A-25 Motor Vehicle Accident Claims Act, R.S.O. 1990, c. M.41, ss. 7, 25
Pierre Champagne, for appellant. Joseph Y. Obagi, for respondents.
The judgment of the court was delivered by
[1] SHARPE J.A.: -- The respondents are residents of Quebec who were involved in a motor vehicle accident with a non- insured driver in Ontario in March 1996. Katia Hanna-Harik ("Katia") claimed damages for personal injuries arising from the accident [page339] and Michel Harik ("Michel") claimed damages for loss of care, guidance and companionship under the Family Law Act, R.S.O. 1990, c. F.3, s. 61. Katia asserted claims both in Ontario and in Quebec. Michel's claim was asserted only in the Ontario action. Both respondents succeeded in Ontario, but Katia's claim was rejected under Quebec's no- fault compensation scheme. The issue on this appeal is whether their request for payment of the Ontario judgment under the Motor Vehicle Accident Claims Act, R.S.O. 1990, c. M.41 (the "Act") should be refused on account of s. 25(2) which provides that no payment from the Fund shall include "an amount that would not be payable by the law of the jurisdiction in which such person resides".
[2] The respondents' action against the uninsured driver in Ontario was defended by counsel representing the Motor Vehicle Accident Claims Fund (the "Fund"). Liability was not in issue. The Fund argued that Katia's injuries were not caused by the accident and that, in any event, they did not meet the then applicable threshold for non-pecuniary damages under Ontario law. In his detailed reasons for judgment, Cunningham J. found that Katia had suffered a debilitating soft-tissue injury as a result of the accident, and awarded her $33,783.68 for non- pecuniary damages, plus $8,834.66 pre-judgment interest. The trial judge assessed Michel's Family Law Act claim at $4,391.84 plus $1,148.50 pre-judgment interest, and awarded the respondents $20,000 costs.
[3] Quebec's no-fault compensation scheme for injuries sustained in motor vehicle accidents, established by the Loi sur l'assurance automobile du Québec, L.R.Q., ch. A-25, bars legal actions in court in Quebec for personal injuries arising from motor vehicle accidents. The Société de l'assurance automobile du Québec (the "Société") determines indemnities for personal injuries arising from motor vehicle accidents. There is a maximum indemnity for non-pecuniary damages -- in 1996 it was fixed at $132,622 -- and a claimant's entitlement is determined by reference to a scale, fixed by regulation, of specified percentages of the maximum indemnity based upon categories of "déficit anatomo-physiologique". The "déficit anatomo-physiologique" is determined by medical experts who assess the injury and categorize it in accordance with the regulation.
[4] Immediately following the accident, Katia filed for benefits from the Société. Her claim for income replacement benefits was initially accepted but, shortly thereafter, the Société determined that she was able to return to work and her income replacement benefits were terminated. Katia was unsuccessful in her appeals to a review panel and the Tribunal administratif du Québec. [page340]
[5] Katia also claimed non-pecuniary damages under the Quebec scheme. Her claim was dismissed on the ground that she had suffered no permanent after-effects of the accident. She appealed to a review panel and ultimately to the Tribunal administratif du Québec, but her appeals were dismissed.
[6] The respondents moved before the motions judge for an order pursuant to s. 7 of the Motor Vehicle Accident Claims Act for payment of the damages awarded by the Ontario trial judge in the action against the uninsured driver. The Fund resisted the motion on the basis that any payment to the applicants was precluded by s. 25 of the Act which provides as follows:
25(1) In this section"residence" shall be determined as of the date of the motor vehicle accident as a result of which the damages are claimed.
Payments to non-residents
(2) The Minister shall not pay out of the Fund any amount in favour of a person who ordinarily resides outside of Ontario unless such person resides in a jurisdiction in which recourse of a substantially similar character to that provided by this Act is afforded to residents of Ontario, and no payment shall include an amount that would not be payable by the law of the jurisdiction in which such person resides. 25(1) Dans le présent article, la " résidence " d'une personne est établie en se fondant sur la date où est survenu l'accident de véhicule automobile qui a donné lieu à la demande en dommages-intérêts. Paiements aux non-résidents (2) Le ministre ne prélève aucun paiement sur le Fonds pour le compte d'une personne qui réside ordinairement en dehors de l'Ontario, sauf si elle réside dans le ressort d'une compétence législative où un recours de caractère semblable à celui que prévoit la présente loi est offert aux résidents de l'Ontario, et aucun paiement ne doit comprendre un montant que n'accorderait pas la loi en vigueur dans le ressort où réside cette personne.
(Emphasis added)
[7] Counsel for the Fund submitted that, since the respondents were not entitled to any payment under the Quebec scheme, s. 25(2) precluded any payment to them from the Fund.
[8] The motions judge dismissed that argument and ruled that the word "payable" in s. 25(2) should be interpreted as "an amount that may, can or must be paid" rather than as meaning that there had to be an obligation to pay the sum. As the amount claimed by the applicant was less than the maximum indemnity permitted by the Quebec legislation, the motions judge allowed the application, and granted an order requiring the Fund to pay the applicants the amounts awarded in the initial Ontario judgment. The Fund appeals to this court. [page341]
[9] The Fund submits that the motions judge erred in his interpretation of s. 25(2). It contends that this provision requires an applicant to establish not only an entitlement to damages in Ontario, but also that the amount awarded in Ontario would be awarded by the law of jurisdiction in which the claimant resides. The Fund argues that by precluding payments "that would not be payable" by the law of the claimant's place of residence, the legislature intended to impose a requirement that there be an actual obligation to pay in the specific circumstances presented by the claimant. The Fund relies upon the use of the word "accorderait" in [the] French version of the statute, noting that "accorderait" means a sum of money that a person is under an obligation to pay. The Fund submits that the dismissal of the respondents' claim under the Quebec regime provides conclusive proof that there is no amount payable by the law of the place of residence.
[10] To accept the interpretation advanced by the Fund requires a finding that the legislature intended that there should be two trials of damages claims: one under Ontario law, and the second under the extra-provincial law. This would require the applicant to present expert evidence explaining both the extra-provincial law and how the claim would be assessed under that law. The cost and inconvenience of such a result is apparent. I would avoid it for the following reasons.
[11] Section 25(2) must be read in its entirety. I agree with counsel for the respondent that s. 25(2) contemplates two stages of analysis. At the first stage, one must determine whether the claimant is the resident of a jurisdiction "in which recourse of a substantially similar character to that provided by this Act is afforded to residents of Ontario". Given the very significant differences between the Ontario law relating to personal injury damages and Quebec's no-fault scheme, there might be some question whether Quebec does afford "substantially similar" recourse. However, that issue is not before us. The Fund conceded the point before the motions judge, likely because of an agreement between Ontario and Quebec providing for subrogation rights in cases involving compensation paid to non-residents.
[12] If the schemes are "substantially similar", one then proceeds to the second stage dealing with the exclusion of payments of "an amount that would not be payable under the law of the jurisdiction in which the person resides." When read in light of the requirement that the law of the place of the claimant's residence provide "substantially similar" relief to Ontario residents, I do not read this second element of s. 25(2) as requiring the claimant to establish his or her right to precisely the same relief under the law of his or her place of residence. [page342]
[13] This is remedial legislation that is designed to insure the protection of persons injured by uninsured motorists on a "truly reciprocal" basis: see Re Melanson v. Duncan, 1965 264 (ON SC), [1965] 2 O.R. 812, 52 D.L.R. (2d) 205 (H.C.J.) at p. 817 O.R.; Young v. Ontario (Minister of Finance) (2002), 2002 49414 (ON SC), 58 O.R. (3d) 284, 24 M.V.R. (4th) 209 (S.C.J.) at pp. 298-99 O.R. To require a fact- specific inquiry into the precise amounts that would be payable under the law of the jurisdiction of the claimant's place of residence would add levels of procedural and evidential complexity to the determination of claims under this scheme and undermine its reciprocal and remedial purpose. Such an interpretation would go against the grain of the general presumption against a multiplicity of proceedings, and would unduly complicate a process designed to protect injured motorists vulnerable to accidents caused by uninsured drivers.
[14] I conclude that, when read in light of the requirement that the schemes be "substantially similar", the concluding words of s. 25(2) are intended only to embrace general limits or caps on damages, not to require another fact-specific determination under the foreign law.
[15] Accordingly, I am not troubled by the apparent inconsistency between the findings of the Ontario judge and the determination of the Quebec regime that the applicant's claim should be excluded. While the appellant did not cast its argument in terms of issue estoppel, I would add here that different procedures are followed in Ontario and in Quebec for the determination of these claims. Different standards apply in the two jurisdictions. The trial judge in Ontario heard several days of evidence and gave very careful and considered reasons in which he concluded that the plaintiff had established a causal relationship between the accident and the disabling injury from which she suffered. The applicant is entitled to the benefit of that finding as against the Fund in Ontario and her claim should not be defeated by the different treatment accorded her claim under the Quebec scheme.
[16] It is conceded by the respondents that, under Quebec law, Michel has no right corresponding to that conferred by the Family Law Act for damages for loss of companionship and that, accordingly, the motions judge erred in granting Michel an order for the payment of that award by the Fund.
[17] Accordingly, I would allow the appeal, but only to the extent of varying the judgment to exclude payment of the amount awarded to Michel Harik. As the respondents conceded this point, they are entitled to their costs of the appeal. I would fix the costs, on a partial indemnity basis, at $8,000.
Order accordingly. [page343]