Sahinbay v. Unica Insurance Inc., 2015 ONSC 7016

CITATION: Sahinbay v. Unica Insurance Inc., 2015 ONSC 7016

DIVISIONAL COURT FILE NO.: 227/15

DATE: 2015-11-26

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

BETWEEN:

ARIF SAHINBAY Applicant

– and –

UNICA INSURANCE INC. Respondent

COUNSEL: Mr. Arif Sahinbay, in Person Mr. Harry Brown, for the Respondent

HEARD at Toronto: September 29, 2015

M.A. SANDERSON J.

Introduction

[1] The Respondent, Unica Insurance Inc. ("Unica"), seeks an order that the Applicant, Arif Sahinbay, has no jurisdiction to appeal from the Order of Financial Services Commission of Ontario ("FSCO") Arbitrator Robinson dated March 19, 2015, without first proceeding to appeal to the Director of Arbitrations ("Delegate") in accordance with s. 283(1) of the Insurance Act, RSO 1990 cI.8, as amended, and with s. 50(1) of the FSCO Dispute Resolution Practice Code ("FSCO Code").

Facts

[2] The Applicant was involved in a motor vehicle accident on April 9, 2010. He claimed that he suffered a traumatic brain injury along with other physical injuries in the motor vehicle accident. He claimed accident benefits, including a non-earner benefit, payment for attendant care and housekeeping expenses. He sought to be designated as catastrophically injured.

[3] He elected a FSCO arbitration that was heard over a number of days in October, 2014, over a number of days.

[4] On the first day of the arbitration, the Applicant's counsel removed herself as his lawyer. Although the Arbitrator offered him an adjournment to retain new counsel, the Applicant elected to proceed.

[5] On March 9, 2015, Arbitrator Robinson released his Reasons for Decision, denying the Applicant's claims for non-earner benefits and catastrophic impairment, but awarding him housekeeping and attendant care benefits for the period between April 9, 2010 and April 8, 2011.

[6] Rather than seeking a review by the Delegate pursuant to the process set out in s. 283(1) of the Insurance Act and in s. 50(1) of the FSCO Code, the Applicant sought immediate Judicial Review from the Divisional Court.

The Relevant Statutory Provisions

[7] Section 283(1) of the Insurance Act, R.S.O. 1990, c.I.8, as amended, provides as follows: "Appeal against arbitration order – A party to an arbitration under section 282 may appeal the order of the arbitrator to the Director on a question of law."

[8] Section 50.1 of the Dispute Resolution Practice Code (Part 4 – Appeal of Arbitration Order) provides: "A party to an arbitration may appeal an order of an arbitrator to the Director only on a question of law."

[9] Counsel for the Applicant submitted that immediate Judicial Review is in order.

[10] Counsel for the Applicant submitted it is not mandatory to appeal to the Director before he can seek Judicial review from the Divisional Court.

[11] Pursuant to s. 283(1) of the Insurance Act, R.S.O. 1990, a party to an arbitration under s. 282 "may" appeal the arbitration order to the Director of Arbitrations on a question of law and pursuant to s. 282(12) of the Insurance Act, R.S.O. 1990, a party to an arbitration "may" apply to the Director for an appointment of a new arbitrator if that party believes that the arbitrator is biased, and the Director shall determine the issue. There is nothing in s. 283(1) that mandates that the Applicant first exhaust all his rights pertaining to an appeal before the Director as a condition of this Court taking jurisdiction in respect of judicial review of the Arbitrator's decision.

[12] Counsel for the Applicant submitted that the intent of s. 283(1) is to allow a party to an arbitration to initiate an appeal to the Director on questions of law. It was never intended and cannot reasonably be interpreted to limit the right of a party to an arbitration to seek judicial review of an arbitration order.

[13] He submitted that s. 282(12) was likewise intended to expand a party's rights before a Director - in this case, for an appointment of a new arbitrator. There is nothing in its language of that can reasonably be interpreted as mandating that a party to an arbitration must first apply to the Director to determine any issues of bias before this court can take jurisdiction over the matter.

[14] Counsel for the Applicant submitted that the Arbitrator's Reasons for Decision were marred by a pattern of bias, mischaracterization of the Applicant's evidence, logical inconsistencies, and a failure to reasonably consider the Applicant's evidence. They were tainted by adverse credibility inferences against the Applicant that had arisen out of the Arbitrator's failure to consider supporting collateral information provided by the individuals closest to the Applicant in attending to his daily needs – specifically his wife and Erol Ozdemir.

[15] He submitted that the Arbitrator demonstrated unreasonable bias by accepting the evidence of the insurer's assessors, formulated without consideration of that collateral information, and by rejecting the evidence of the Applicant's doctor and assessors, who had considered the collateral information.

[16] He argued that the Arbitrator also demonstrated unreasonable bias and a misapprehension of the Applicant's evidence when he asserted that it was "impossible" to accept Dr. Gerber's evidence because it was "tainted" by the Applicant's "lack of candour" – despite the fact that Dr. Gerber had considered supporting collateral information provided by the Applicant's witnesses, and had administered a test known as the Structured Interview of Reported Symptoms, in order to systematically evaluate the Applicant's credibility.

[17] He submitted that had the insurer's assessors weighed their own subjectively based impressions of the Applicant against such collateral information, they might have reached different conclusions in regard to whether the Applicant had put forth a sub-maximal effort when they examined him.

[18] Counsel for the Applicant submitted that the Arbitrator mischaracterized the Applicant's evidence when, for instance, he criticized Dr. Gerber's answers on the question of malingering as being "essentially a flat denial". He failed to mention Dr. Gerber's comments about the necessity of collateral information. The collateral information was consistent with Dr. Gerber's own conclusions after examination of the Applicant.

[19] He submitted that the Arbitrator's failure to consider the issue of collateral information – and the insurer's experts failure to consider it in assessing credibility caused the Arbitrator to confirm his own subjective bias in evaluating the surveillance tapes and in concluding that the Applicant had demonstrated a "lack of candour".

[20] With respect to the causation issue, counsel for the Applicant submitted that the Arbitrator accepted that the accident caused the Applicant to soil his apartment with human waste in the initial weeks after the accident, and yet inconsistently concluded that there was no material change in his ability to lead a "completely normal life" after the accident. He concluded that the Applicant was affected by the same "major depressive disorder" both before and after the accident.

[21] There was no evidence to support the Arbitrator's conclusion that the Applicant had suffered from "a complete inability to enjoy a normal life" just prior to the accident.

[22] Counsel for the Applicant submitted that the Arbitrator's conclusions on causation were inconsistent with his conclusion that the Applicant was entitled to time-limited attendant case benefits.

[23] His conclusions on causation were not reasonably supported by the evidence of the insurers [because the insurer's assessors had made no reference to the collateral information, they had no baseline to evaluate any deterioration in the applicant's condition after the accident].

[24] The Arbitrator should have accepted the evidence of the doctors who personally examined the Applicant.

[25] Dr. Sivasubramanian was in the best position to consider the changes in the Applicant's condition caused by the accident.

[26] He initially diagnosed the Applicant with a major depressive disorder. He was the only medical witness who treated the Applicant on an ongoing basis both before and after the accident. He also had recourse to the collateral information provided by the Applicant's wife.

[27] Counsel for the Applicant submitted that, in view of the inconsistencies in the Arbitrator's conclusions and the failure to consider unchallenged collateral information this Court should rectify the Arbitrator's decision.

[28] Here, the Applicant is claiming that the Arbitrator's judgment was tainted by bias.

[29] Counsel for the Applicant submitted that the Applicant should not be put to the needless added expense of seeking relief under the Director's auspices, of submitting himself to a stacked deck or to "a foregone conclusion" by being required to exhaust all his rights under the Director's auspices before coming to this Court.

The Law

[30] In Ontario College of Art v. Ontario (Human Rights Commission) (1993), 11 O.R. (3d) 798, the Divisional Court wrote at p. 800:

For some time now, the Divisional Court has … taken the position that it should not fragment proceedings before administrative tribunals. Fragmentation causes both delay and distracting interruptions in administrative proceedings. It is preferable, therefore, to allow such matters to run their full course before the tribunal and then consider all legal issues arising from the proceedings at their conclusion….

[31] Swinton J. wrote in Ravikovich v. College of Physicians and Surgeons, 2010 ONSC 5194 (Div. Ct.), at para. 4:

This Court has consistently refused to engage in a review of the decisions of administrative tribunals until a final decision has been reached, absent extraordinary circumstances. As this Court said in Lala v. College of Physiotherapists of Ontario, [2003] O.J. No. 5062 (Div. Ct.), at para. 2:

In the absence of exceptional circumstances, it is preferable to allow administrative proceedings to run their full course before the tribunal and to consider the legal issues arising from the proceeding including procedural matters against the backdrop of a full record and a reasoned decision of the tribunal.

[32] The Divisional Court in considering the standard of review for Delegate decisions, recently recognized the specialized expertise of the FSCO. It noted that the issues related to the Insurance Act and the Statutory Accident Benefits Schedule are within the specialized expertise of the Delegate. They require the interpretation of FSCO's home statute and regulations. FSCO's decisions are made in a specialized and independent regime established under the Insurance Act to resolve SABs-related issues (Hayward v. Royal & Sun Alliance Insurance Co. of Canada, 2015 ONSC 433 (Div. Ct.), at para. 4).

[33] Molloy J. summarized some instances where judicial intervention may be warranted in Ackerman v. Ontario Provincial Police, 2010 ONSC 910, at para. 19:

That is not to say that the court will never consider a judicial review application while administrative proceedings are still ongoing. However, the court will only do so rarely, when exceptional circumstances are demonstrated. For example, judicial intervention may be warranted in situations where the tribunal clearly lacks jurisdiction to proceed (Roosma; Deemar v. College of Veterinarians of Ontario (2009), 2008 ONCA 600, 92 O.R. (3d) 97 (C.A.)); where the decision, although interlocutory in most respects, determines a particular issue (as in Canada (Minister of Public Safety and Emergency Preparedness) v. Kahlon (2005), 2005 FC 1000, 35 Admin L.R. (4th) 213 (FC) in which the summons issued would be dispositive of the witnesses' privacy rights); or, where proceeding with the hearing would result in an unfair hearing or a breach of natural justice (McIntosh; People First of Ontario v. Regional Coroner of Niagara (1992), 6 O.R. (3d) 289 (C.A.)). Even in those extreme situations, the remedy is discretionary and will be exercised sparingly.

[34] Courts will generally refuse to hear judicial review applications on the merits. When the applicant has an adequate alternative remedy, such as an internal review or appeal mechanism. An adequate alternative exists where "the defect alleged … can be raised before the reviewing body, and where the reviewing body is capable of 'curing' the defect" (Volochay v. College of Massage Therapists of Ontario, 2012 ONCA 541, at para. 73).

[35] In Canadian Pacific Ltd. v. Matsqui Indian Band, [1995] 1 S.C.R. 3, six of the judges were of the view that a reviewing court has discretion to require an applicant to pursue a statutory appeal process. In exercising its discretion, the court should consider the convenience of the alternative remedy, the nature of the error, the nature of the appellate body and the adequacy of the statutory appeal procedures (taking into account, for example, a further right to appeal to the courts from the appeal tribunal's decision).

Conclusion

[36] I have referred earlier to submissions of counsel for the Applicant intends to make on his substantial application for judicial review.

[37] In my view, the focus here must be on the process to be followed in the review of FSCO's decision, including the Legislature's intention in exacting s. 283.

[38] As noted by the Divisional Court in Hayward, FSCO is part of a specialized and independent regime established under the Insurance Act to resolve SABs related issues. It is asked to arbitrate entitlement to Statutory Accidents Benefits where the parties have elected to have those matters arbitrated before it. Generally, proceedings before administrative tribunals should be allowed to run their full course before the tribunal and the Courts have refused to engage in a review until a final decision has been reached.

[39] FSCO's decisions are entitled to deference from this Court.

[40] FSCO, a specialized tribunal should be allowed to complete its specialized process before the judicial review is heard.

[41] I do not agree that the Applicant would be prejudiced as a result. Rather he will receive consideration under s. 283 and 282 in addition to being able to exercise his rights to judicial review. If, after exhausting the FSCO process, he is not satisfied, he may then exercise his rights in the Divisional Court.

[42] I do not accept the submissions of Counsel for the Applicant that it is a foregone conclusion that FSCO's institution he freely chose will, on any further review under s.283, demonstrate "institutional bias" against him or that the "deck will be stacked" against him.

Disposition

[43] The Applicant's application to the Divisional Court is stayed pending any further proceedings under s. 282 and s. 283 of the Insurance Act.

[44] The parties may make written costs submissions on or before December 5, 2015.

___________________________ M.A. SANDERSON J.

Released: November 26, 2015