SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: CV-13-480890
DATE: 20140218

RE: WAWANESA MUTUAL INSURANCE COMPANY, Appellant

AND:

WATERLOO INSURANCE COMPANY, Respondent

BEFORE: CHIAPPETTA J.

COUNSEL:
Kirk Boyd, for the Appellant

Nicholaus deKoning, for the Respondent

HEARD: January 16, 2014

ENDORSEMENT

[1] This is an application for appellate review of a decision of Mr. Lee Samis, a private arbitrator (the “Arbitrator”), pursuant to s. 45(3) of the Arbitration Act, 1991, S.O. 1991, c. 17. In his decision, dated April 25, 2013, the Arbitrator concluded that the Respondent, Waterloo Insurance Company (“Waterloo”), gave timely written notice to the Appellant, Wawanesa Mutual Insurance Company (“Wawanesa”) to dispute its obligation to pay benefits on the basis that on November 21, 2006 Waterloo received a “completed application” within the meaning of s. 3(1) of Disputes Between Insurers, O. Reg. 283/95.

[2] This appeal deals with the narrow issue of when Waterloo received a “completed application” for the purpose of triggering the 90-day notice period in s. 3(1) of O. Reg. 283/95. Specifically, did the Arbitrator err in concluding that the 90-day notice period commenced on November 21, 2006.

[3] For reasons set out below, I conclude that the 90-day notice period was triggered effective August 18, 2006. The Arbitrator erred in concluding the 90-day period commenced on November 21, 2006. The appeal is therefore allowed.

Overview

[4] The Insurance Act, R.S.O. 1990, c. I.8 (“the Act”), requires insurers to pay statutory accident benefits to injured motor vehicle accident victims. Pursuant to s. 268 of the Act an injured victim is required to claim benefits from a policy where that person is the named insured or is the spouse of a named insured.

[5] Ontario Reulation 283/95 sets out the procedure to be followed when disputes arise between insurers about the payment of benefits. The relevant sections of O. Reg. 283/95 for this appeal are as follows:

1. All disputes as to which insurer is required to pay benefits under section 268 of the Act shall be settled in accordance with this Regulation.

2. (1) The first insurer that receives a completed application for benefits is responsible for paying benefits to an insured person pending the resolution of any dispute as to which insurer is required to pay benefits under section 268 of the Act.

3. (1) No insurer may dispute its obligation to pay benefits under section 268 of the Act unless it gives written notice within 90 days of receipt of a completed application for benefits to every insurer who it claims is required to pay under that section.

(2) An insurer may give notice after the 90-day period if,

(a) 90 days was not a sufficient period of time to make a determination that another insurer or insurers is liable under section 268 of the Act; and

(b) the insurer made the reasonable investigations necessary to determine if another insurer was liable within the 90-day period.

(3) The issue of whether an insurer who has not given notice within the 90 days has complied with subsection (2) shall be resolved in an arbitration under section 7.

[6] The Arbitrator found and concluded that Waterloo is within its right to dispute its obligation to pay benefits under s. 268 of the Act because Waterloo gave Wawanesa written notice of its claim that Wawanesa is required to pay under s. 268 within 90 days of receiving a completed benefits application.

[7] Wawanesa appeals that decision. Wawanesa submits that the Arbitrator erred in concluding that Waterloo did not receive a completed application until November 21, 2006.

Standard of Review

[8] The arbitration agreement between the parties provides for an appeal on issues of law and issues of mixed fact and law. The parties agree that the issue on appeal is one of mixed fact and law.

[9] The arbitration agreement is silent regarding the standard of review. For this reason, Wawanesa argues that the standard of review is one of correctness. Further, Wawanesa argues that since there is no dispute about the factual aspects of the arbitration and what is contended is that the Arbitrator misapplied the law to the facts, the Arbitrator’s decision should be measured against a standard of legal correctness: see Gore Mutual Insurance Co. v. Co-operators General Insurance Co. (2008), 2008 46914 (ON SC), 93 O.R. (3d) 234 (S.C.), at para. 6.

[10] Waterloo submits that the applicable standard of review on issues of mixed fact and law is one of reasonableness.

[11] For reasons that follow I have concluded that the Arbitrator’s decision was neither reasonable nor correct.

[12] I intend to analyze the Arbitrator’s decision herein on a standard of reasonableness. The Court of Appeal has directed that the applicable standard of review on questions of mixed fact and law in the context of a review of arbitral decisions under the Act is a reasonableness standard: see Oxford Mutual Insurance Co. v. Co-operators General Insurance Co. (2006), 2006 37956 (ON CA), 83 O.R. (3d) 591 (C.A.), at paras. 22‑23; and see also Zurich Insurance Company v. The Personal Insurance Company (2009), 2009 26362 (ON SC), 73 C.C.L.I. (4th) 301 (Ont. S.C.), at paras 19‑29.

[13] On a reasonableness standard, the reviewing court is to give deference to the decision-maker on questions of law, mixed fact and law and questions of fact. In Powerline Plus Ltd v. Ontario (Energy Board), 2013 ONSC 6720, Wilton-Siegel J. stated at paras. 30‑31, the application of the reasonableness standard is concerned mainly with whether a tribunal has offered an adequate explanation for the decision it has reached, and not whether the reviewing court believes that the decision is optimal. The court recognizes that there is often more than one acceptable and rational outcome to the disposition of a particular issue and that when a tribunal chooses a final decision amongst these different outcomes, that decision is entitled to deference and respect: see Canada (Citizenship and Immigration) v. Khosa, 2009 SCC 12, [2009] 1 S.C.R. 339, at para. 25.

[14] The Arbitrator concluded that there was a functionally completed application with respect to priority dispute issues as of November 21, 2006. In my view, this conclusion falls outside the outcomes which are defensible considering the facts as agreed by the parties, the clear language of O. Reg 283/95 and the relevant jurisprudence.

Facts as Agreed

[15] The key events of the dispute are not in issue, but rather, were submitted before the Arbitrator as an Agreed Statement of Facts. Given the nature of the issue on the appeal, it is useful to set out the agreed facts here.

[16] On June 22, 2006, Mr. S (“the Claimant”) was injured as a passenger in a motor vehicle accident. Mr. P, the owner of the car and the Claimant’s friend, was at that time insured by Waterloo.

[17] On June 29, 2006, the Claimant contacted Waterloo by telephone and disclosed to the Waterloo claims adjuster, Ms. Joyce McLean, (“McLean”) that his wife, Ms. S, has a driver’s license and is the owner of a car. However, Mr. S stated that his wife does not drive the vehicle, and that it is not insured. Mr. S also stated that he did not have a driver’s licence. An OCF‑1 Accident Benefits Application Package was mailed to Mr. S on the same day. In the Adjusting Notes, under the heading “workplan”, McLean made the following note on July 5, 2006: “‑ await statement which will include a priority investigation”.

[18] On July 10, 2006, the Claimant gave a statement by interview to Mr. Ian Mascarenhas of Crawford Adjusters Canada Incorporated (“Crawford”). At page 1 of the Interview Report, Mr. S is recorded as stating, “I do not own a vehicle and do not have a driver’s licence. … My wife does not have a car”. At page 3 of the Interview Report, Mr. S is recorded as stating, “…my drivers [sic] licence has been suspended a year for drinking”. At page 5 of the Interview Report, Mr. S is recorded as stating, “I am not listed to drive on any policy”.

[19] On July 28, 2006, Waterloo received the Claimant’s application for benefits. In Part 4 of the application, at page 4 of 8, Mr. S placed an “X” in the boxes indicating “no” for each of the six responses to question A, “Are you covered under any of the following automobile insurance policies?” As a consequence, Mr. S indicated “no” to the response “Your spouse’s policy”. Mr. S did not complete the section entitled “Marital Status” under Part 1 of the application nor the section entitled “Marital status for tax purposes” under Part 9 of the application.

[20] On August 16, 2006, McLean made the following note in the Adjusting Notes: “confirmed with EES we have 90 days from one [sic] ocf 1 is rec’d to file a dispute between insurers”. McLean made this further note under the heading “workplan”: “await statement, determine priority, once [sic] ocf 1 rec’d file dipuste [sic] if needed”.

[21] On August 18, 2006, Mr. Moses Chan, representing the Economical Insurance Group, conducted an Examination on Consent of the Claimant under oath. At questions 34‑35 of the Examination transcript, Mr. S is recorded as providing the name of his wife. At questions 93‑94 of the transcript, Mr. S is recorded as agreeing that his family drives a car. At question 97 of the transcript, Mr. S is recorded as stating that “my wife is driving”. At question 102 of the transcript, Mr. S is recorded as identifying his wife as the owner of the car that she drives. At question 104 of the transcript, Mr. S is recorded as stating that the car is registered in Québec. At question 105 of the transcript, Mr. S is recorded as answering affirmatively when asked if the car is insured in Québec.

[22] On August 29, 2006, McLean reviewed the Claimant’s file. In the Adjusting Notes, McLean assessed the “priority investigation” as “not very good” in respect of the interview statement of Mr. S taken July 10, 2006 by Crawford. McLean further noted that the name of the Mr. S’s wife, her date of birth, her driver’s license, and other relevant information had not been obtained. McLean made the following note in the Adjusting Notes under the heading “workplan”: “‑ priority investigation clmt to submit requested information on his wife by Sept. 18/06. once rec’d review to determine if priority with us, if not file dispuste [sic]”.

[23] On the same day, McLean sent a letter to the Claimant, which, inter alia, requested information about the Claimant’s wife under s. 33 of Statutory Accident Benefits Schedule, Ont. Reg. 403/96 (“SABS”) by September 18, 2006. The letter states, “[a]s per section 33 of [SABS] the above information is required by September 18, 2006 or no further benefits are payable until the information is provided”.

[24] On August 31, 2006, Mr. Jeff Cowan (“Cowan”), another member of the Waterloo claims department, made the following note in the Adjusting Notes of the Claimant’s file, under the heading “App review”: “Priority Issue, f/u info has been requested from clmnt/lawyer on app response under s. 33 due to time constraints of Notice of Dispute (90 days from receipt of app)”. Cowan then made the following note under the heading “workplan”: “‑await priority info requested under s. 33, if not rec’d suspend irbe”.

[25] On October 4, 2006, McLean made the following note in the Adjusting Notes: “We have not rec’d priority information requested under s. 33 by Sept. 17/06 [sic]”. McLean proceeded to call the Claimant’s lawyer at the David Wilson Law Office. McLean enquired with Ms. Heidi Buchanan about the status of the priority information that had been requested in the letter from McLean to Mr. S dated August 29, 2006. Ms. Buchanan advised that McLean must speak to Mr. David Wilson (“Wilson”) about the matter, who was not available at that time.

[26] On October 31, 2006, McLean reviewed the Claimant’s file and made the following note in the Adjusting Notes: “review of file indicates we have not rec’d information requested in our letter of Aug. 29/06 to determine priority, we requested inforamtion [sic] by Sept. 18/06, Oct. 4/06 called David Wilson lmtc, to date he has not called back”. McLean sent a letter to Mr. S on this date advising him that no further benefits would be paid until Mr. S complied with the s. 33 request for information sent to him by letter dated August 29, 2006.

[27] On the same day, Cowan made the following note in the Adjusting Notes, under the heading “Review of stoppage”: “request dated Aug 29/06 was asking for info to assist in determining priority. We needed back by Sept 18/06 as per s. 33. … Not rec’d to date, stoppage sent today, effective today”.

[28] On November 3, 2006, the Claimant’s lawyer, Wilson, faxed a letter to McLean at Waterloo. In this letter, Wilson stated that “the insurer is probably not entitled to insist upon receipt of such information pursuant to section 33 of the SABS, let alone terminate/suspend benefits as a result of the alleged failure of the insured to provide same”. Neither Wilson nor Mr. S provided the information requested by McLean in her letter dated August 29, 2006.

[29] On November 7, 2006, Cowan and McLean discussed Wilson’s letter dated November 3, 2006. Cowan indicated in the Adjusting Notes that a case conference was held with the Claimant, who “agreed that s. 33 was reasonable for info to determine entitlement to benefits under our policy (priority issue)”. Cowan advised McLean to respond to Wilson’s letter to advise that the information was reasonably required under s. 33 and that Mr. S’s benefits would be reinstated upon receipt of the requested information.

[30] On November 8, 2006, McLean sent a letter by fax to Wilson. In this letter, McLean stated that the information requested under s. 33 of SABS was reasonably required to determine if the Claimant was entitled to accident benefits under Waterloo’s policy or if there was another insurer who might have a higher priority level.

[31] On November 21, 2006, Waterloo received a letter from Wilson dated November 16, 2006, which enclosed the requested insurance and ownership information about the car owned by the Claimant’s wife. On November 23, 2006, McLean reviewed Wilson’s November 16 letter and the documents enclosed following which McLean reinstated Mr. S’s benefits. On November 24, 2006, McLean made the following note in the Adjusting Notes: “Nov. 23/06 rec’d from lawyer clmt’s wife insurance information therefore reinstated benefits irb and attendant care”.

[32] Also on November 24, 2006, McLean determined that the Claimant’s wife had a valid automobile insurance policy in Québec with Wawanesa. McLean made the following notes in the Adjusting Notes: “clmt’s wife does have a valid Quebec auto policy with Wawanesa … ‑ reviewed with [Cowan] to confirm if priority rules apply to a Quebec policy … ‑ was advised to file a Dispute Between Insureres [sic]”.

[33] On the same day, Waterloo served Wawanesa with the Notice of Dispute.

The Arbitrator’s Decision

[34] The issue before the Arbitrator was narrow: Did Waterloo provide written notice of its intent to dispute priority within 90 days of receiving a completed application for statutory accident benefits, as required by s. 3(1) of O. Reg. 283/95, and if not, does the savings provision of s. 3(2) apply?

[35] The Arbitrator held that the application received by Waterloo on July 28, 2006 was not a “completed application” as contemplated by s. 3 of O. Reg, 283/95. The Claimant’s marital status was left blank and the Claimant incorrectly answered the questions in the application specifically designed to determine priority of payment. He advised that he was not covered under any of the six different classes of automobile insurance policies listed therein, including “Your spouse’s policy”. If the form had been properly completed, the Arbitrator concluded, “it would have contained an indication that [Mr. S] was an insured person under his spouse’s policy and it would have given the identifying documentation with respect to Wawanesa and would have allowed Waterloo to give notice of dispute to Wawanesa if they chose to do so”.

[36] The Arbitrator relied on the Ontario Court of Appeal’s decision of Ontario (Minister of Finance) v. Pilot Insurance Co., 2012 ONCA 33, 109 O.R. (3d) 168, where Justice Laforme, at paras. 46‑56, directed that an incomplete form could be subsequently supplemented by other information and, once supplemented, the insurer may be considered to have a functionally adequate application for the purpose of notifying a priority insurer, if they chose to do so.

[37] Applying the principles of Pilot Insurance to his factual findings, the Arbitrator held as follows:

[A]s of November 21, 2006, Waterloo’s information would have been supplemented with the identifying information about the Wawanesa policy. It appears to me that from that point, at least, the previously received application has been supplemented sufficiently to cause it to be a legally “completed” application.

At no point prior to November 21, 2006 did Waterloo have sufficient external information to supplement the standard OCF form and make it functionally complete. Thus, based on the law as defined by our courts, Waterloo did not receive a completed application for benefits (for priority purposes) until November 21, 2006.

[38] Upon concluding that there was a functionally completed application for benefits with respect to priority dispute issues as of November 21, 2006, the Arbitrator thus held that the Notice of Dispute given by Waterloo on November 24, 2006 to Wawanesa was timely.

[39] Nonetheless, the Arbitrator went on to consider the application of s. 3(2), the savings provision. He adopted in large part the observations of Wawanesa’s expert witness, Mr. James Cameron (“Cameron”), about Waterloo’s handling of the file. The Arbitrator noted that “although I found Mr. Cameron’s opinion to be strongly worded, his recitation of the events and missed opportunities has considerable merit”. The Arbitrator found that the handling of the claim from when it was opened to November 24, 2006 was “imperfect” and stated as follows:

But on the whole, I do feel that the investigation done with respect to priority does not meet the criteria in subsection 2 of section 3 of Ontario Regulation 283/95.

Therefore, if I had found a completed application were received by Waterloo on July 28, 2006, I would not permit Waterloo to give notice after the 90 day period as there was no compliance with 3(2)(a) or (b) of Ontario Regulation 283/95.

Analysis

[40] The question before the Arbitrator was, when the 90-day period commenced under s. 3(1) of O. Reg. 283/95. To answer this question, the Arbitrator had to determine when Waterloo was in receipt of a “completed application”.

[41] In making his determination the Arbitrator considered the correct legal principles from Pilot Insurance, at para. 42. He recognized that a “completed application” for the purposes of s. 3 of O. Reg. 283/95 is one that is

(1) Genuinely complete
(2) Functionally adequate for its legislative purpose, or
(3) Treated as complete based on the conduct of the first insurer.

[42] The question then became one of applying the correct legal principles to the factual findings to conclude when Waterloo was in receipt of a complete application. This came down to when the application became functionally adequate for its legislative purpose. As noted, the Arbitrator concluded that there was a functionally adequate application on November 21, 2006, such that the Notice of Dispute between insurers given by Waterloo on November 24, 2006 was within the 90 days prescribed by s. 3(1) of O. Reg. 283/95.

Wawanesa’s Position

[43] Wawanesa submits that the Arbitrator erred in concluding that the 90 days for the purposes of s. 3(1) of O. Reg. 283/95 commenced on November 21, 2006.

[44] Wawanesa argues that the 90‑day period should not begin when the first insurer receives full and exact priority information that specifically identifies a priority insurer and/or insurance policy. Rather, the 90 days should commence upon receipt of basic information sufficient to use as a starting point in making further reasonable investigations necessary to determine if another insurer was liable.

[45] Waterloo was in receipt of information as early as June 29, 2006 that disclosed Mr. S was married, the name of Mr. S’s wife, and the fact that she had a car. The Arbitrator failed to consider the evidence of Cameron, which indicated that receipt of the information regarding Mr. S’s wife on June 29, 2006 was sufficient to cure the errors and omission in his application received July 28, 2006 to the extent that Waterloo could make the reasonable investigations necessary to determine whether another insurer was liable. The 90 days should thus commence on June 29, 2006.

[46] In the alternative, Wawanesa submits that the 90 days should commence at the latest on August 18, 2006 i.e. Waterloo should be treated as receiving a completed application effective August 18, 2006. During the examination of Mr. S under oath held that day, Mr. Chan asked questions that determined the name of Mr. S’s Wife and that Mr. S’s wife had a car and an insurance policy in Québec. This was enough to supplement the application and provide Waterloo with a starting point for further reasonable investigations to determine if another insurer was liable.

Waterloo’s Position

[47] Waterloo submits that there is no basis for Wawanesa to argue that Waterloo had a functionally adequate application on July 28, 2006. The application contained inaccurate information and did not even disclose the existence of a spousal insurance policy, let alone reasonable particulars so that Waterloo could put another insurer (which turned out to be Wawanesa) on notice.

[48] Cameron conceded, it submits, that Waterloo identified that Mr. S’s spouse had a policy of insurance in Québec for the first time on August 18, 2006. As was also conceded by Cameron, the information could have led to particulars about the Wawanesa policy (spouse’s name, address and driver’s license number) and could only come from Mr. S himself.

[49] On August 29, 2006, Waterloo followed the correct procedure by asking Mr. S and his counsel in writing for the information. The correct questions were asked. As was conceded by Cameron, having asked those questions in writing by August 29, 2006 there was absolutely nothing else that Waterloo could have done to obtain the information necessary to identify Wawanesa as the insurer to be put on notice of a dispute, except cancelling Mr. S’s income replacement benefits. In fact, this step was taken and did, in fact, lead to Wilson providing the requested information on November 21, 2006.

[50] Waterloo concedes there was imperfect follow‑up and missed opportunities following its letter of August 29, 2006, but notes that ultimately the necessary information about Wawanesa’s policy had to come from Mr. S himself. The correct questions were asked well within 90 days of receiving the incomplete application.

Discussion

[51] In my view, the Arbitrator erred in concluding that the 90 days for the purposes of s. 3(1) of O. Reg. 283/95 did not commence before November 21, 2006. I agree with Wawanesa that the 90 days commenced on August 18, 2006.

[52] Pursuant to s. 3(1) of O. Reg. 283/95, no insurer may dispute its obligations to pay benefits under s. 268 of the Act unless it gives written notice within 90 days of receipt of a completed application for benefits to every insurer who it claims is required to pay under that section. In applying s. 3(1), the question before the Arbitrator was, on what date did Waterloo receive a functionally adequate application for its legislative purpose? To answer that question one must first determine the legislative purpose of a functionally adequate application.

[53] Pursuant to s. 3(2) of O. Reg. 283/95, an insurer may give notice after the 90‑day period has expired if it can demonstrate that (a) 90 days was not a sufficient period of time to make a determination that another insurer is liable; and, (b) the insurer made the reasonable investigations necessary to determine if another insurer was liable within the 90‑day period. The insurer can be forgiven and can preserve its right to dispute its obligation if the insurer can demonstrate it acted diligently within the 90 days to determine if another insurer was liable.

[54] In my view, the legislation contemplates that the insurer will be conducting investigations during the 90 days pursuant to s. 3(1) to determine if another insurer is liable and only if, after conducting the necessary reasonable investigations within the time allotted, without success, will the 90 days be extended to continue the investigations to determine if another insurer is liable. It follows that the legislative purpose of a functionally adequate application is one that provides the first insurer with information sufficient to commence its investigations to determine whether another insurer is liable. To conclude otherwise would render the savings provision of s. 3(2) meaningless.

[55] The Arbitrator concluded that the Application “would be considered functionally adequate when the information about the spousal policy became known in November 2006”. There were no further investigations by Waterloo as of that date, however, to determine if another insurer was liable under s. 268. On November 21, 2006, Waterloo knew that Wawanesa was the insurer of Mr. S’s spouse. The first insurer was in receipt of complete and exact priority information that specifically identified a priority insurer and insurance policy.

[56] The concept of necessary reasonable investigations and the savings provision of s. 3(2) are rendered absurd by such a standard of perfection. If the 90 days begins only upon identification of the second insurer, there is no need to permit 90 days of necessary reasonable investigations or relief therefrom upon demonstrated due diligence. It is for this reason that the Arbitrator’s conclusion that the 90 days commenced on November 21, 2006 falls outside of the range of possible, acceptable outcomes which are defensible in respect of the facts and law: see Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190, at para 47.

[57] This interpretation is consistent with Ontario jurisprudence considering the interpretation of “functionally adequate” for the purposes of s. 3(1) of O. Reg. 283/95. In Pilot Insurance, Justice Laforme held that the identity of the motorist who struck the cyclist was sufficient external information to supplement the standard OCF‑1 form and make it functionally adequate so as to be a complete application.

[58] Similarly, in Ontario (Minister of Finance) v. Lombard Insurance Co. of Canada, 2010 ONSC 1770, 100 O.R. (3d) 51, Justice Perell determined that the missing information that made the application a “completed application” and triggered the start of the 90‑day period was the licence plate number of the vehicle the claimant had collided with. It was obtained from the independent security records of the premises where the accident had occurred.

[59] The Arbitrator reasonably held that Waterloo received an incomplete application from Mr. S on July 28, 2006. His marital status information was left blank, and Mr. S incorrectly advised that he was not insured in regards to any policy of insurance issued to his spouse.

[60] The application became functionally adequate or complete, however, on August 18, 2006. In the context of the examination under oath, Waterloo learned the name of Mr. S’s wife and that she had a car and an insurance policy in Québec. This external information was sufficient to supplement the application and allow Waterloo to begin making reasonable investigations necessary to determine whether another insurer was liable.

[61] Waterloo commenced the investigations as contemplated. On August 29, 2006, McLean, on behalf of Waterloo requested information about Mr. S’s spouse through his counsel, Wilson. The letter requested specifics of the spouse’s name, her driver’s licence number, a description of the vehicle, and insurance particulars. The Arbitrator noted that the questions posed were highly relevant to the priority issues. McLean set a targeted deadline of September 18, 2006 to review information provided. Mindful, it would seem, of a finite period for investigation.

[62] McLean’s letter to Wilson is exactly the type of investigation contemplated within the 90‑day period, to determine if another insurer is liable. McLean’s efforts eventually led to Wilson providing the requested information on November 21, 2006.

[63] Waterloo argues that the 90 days did not commence on August 18, 2006 because Wawanesa’s expert, Cameron, acknowledged that the name and driver’s licence number of Mr. S’s wife could only come from Mr. S. There was no other alternative. Further, it is argued that as noted by Wilson, s. 33 of SABS probably cannot be used to obtain information to determine whether there is another insurer who might have a higher priority level. In my view, these are statements properly considered under the s. 3(2) analysis in terms of whether the 90 days was a sufficient period of time to make a determination that another insurer is liable and whether the insurer’s investigative efforts within that time were reasonable. They are not relevant considerations regarding the very commencement of the 90‑day period.

[64] For reasons noted above I conclude that the Arbitrator erred in holding that Waterloo did not receive a completed application for benefits within the meaning of s. 3(1) of O. Reg. 283/95 until November 21, 2006 and in turn gave proper notice to Wawanesa within 90 days to dispute its obligation to pay benefits to the Claimant. Rather, Waterloo received a completed application on August 18, 2006. In serving Wawanesa with a Notice of Dispute on November 24, 2006, Waterloo therefore failed to provide written notice of its intent to dispute priority within 90 days of receiving a completed application for statutory accident benefits, as required by s. 3(1) of O. Reg. 283/95.

[65] The Arbitrator also concluded that the saving provisions of s. 3(2) of O. Reg. 283/95 do not apply. In making his conclusion the Arbitrator relied heavily on the opinion of Cameron about the handling of the file. Further, the Arbitrator had the benefit of Waterloo’s concession of imperfect follow‑up and missed opportunities in its follow‑up to its letter of August 29, 2006,

[66] The Arbitrator stated as follows:

[T]here were considerable gaps in the investigation conducted by Waterloo with respect to priority issues. There seems to have been mistakes made, opportunities overlooked, and general confusion with respect to this vein of the investigation.

There does seem to have been a period of lack of response which critically occurred from the end of August until the end of October. It seems likely that if the inquiries made had been pursued on a tighter timeline in the latter part of September and early part of October, identification of the Wawanesa policy might have been achieved at an earlier date.

[67] I find his conclusion regarding the application of s. 3(2) of O/Reg. 283/95 both reasonable and correct and see no reason to disturb it.

Disposition

[68] For reasons given above, the appeal is allowed. The Award of Arbitrator Samis, dated April 25, 2013 is set aside. I make the following Orders:

1. That Waterloo’s Application in the arbitration proceedings, pursuant to s. 7 of O. Reg. 283/95, is dismissed;

2. That Waterloo received a functionally adequate and therefore complete application for benefits within the meaning of s. 3(1) of O. Reg. 283/95 more than 90 days before giving the Notice of Dispute to Wawanesa;

3. That Waterloo may not rely upon s. 3(2) of O. Reg. 283/95 to give written notice to Wawanesa after the 90‑day period.

Costs

[69] The parties are encouraged to agree on an appropriate costs award for this appeal. If the parties are unable to agree I will receive written submissions of not more than two pages, first from Wawanesa and then from Waterloo.

CHIAPPETTA J.

Date: February 18, 2014