



COURT OF APPEAL FOR ONTARIO

CITATION: Ayr Farmers Mutual Insurance Company v. Wright,
    2016 ONCA 789

DATE: 20161027

DOCKET: C61202

Simmons, Gillese and Hourigan JJ.A.

BETWEEN

Ayr Farmers Mutual Insurance Company

Applicant (Appellant)

and

Scott Wright

Respondent (Respondent)

Daniel Strigberger and Jenna Leigh Meth, for the appellant

James John Mays, for the respondent

Heard: May 2, 2016

On appeal from the order of Justice Paul R. Sweeny of the
    Superior Court of Justice, dated October 7, 2015, with reasons reported at 2015
    ONSC 6219.

Simmons J.A.:

A.

I
ntroduction

[1]

Under s. 268 of the
Insurance
    Act
, R.S.O. 1990, c. I.8 (the Act), statutory
    accident benefits (SABs) are provided for in every automobile insurance policy
    in Ontario so that persons injured in automobile accidents in Ontario and
    Ontario residents injured in car accidents outside Ontario are entitled to receive
    SABs regardless of fault.

[2]

In this case, Scott Wright applied
    to Ayr Farmers Mutual Insurance Company for SABs, claiming that he was injured when
    he tried to close his garage door after backing his vehicle out of his garage.

[3]

Ayr Farmers denied Mr. Wrights claim
    for SABs, saying that his injuries were not the result of an accident as defined
    in the
Statutory Accident Benefits Schedule  Effective September 1,
    2010
, O. Reg. 34/10 (the Schedule), and that
    he was not therefore entitled to SABs.

[4]

Sections 279 to 283 of the Act set
    out a mandatory scheme for resolving disputes in respect of any insured persons
    entitlement to statutory accident benefits (the s. 279 scheme). The s. 279 scheme
    requires that parties submit disputes in respect of entitlement to SABs to mediation
    before any court proceeding can be brought: ss. 279, 281(2).

[5]

Mr. Wright applied for mediation under
    the s. 279 scheme to resolve his dispute with Ayr Farmers.

[6]

Rather than attend the mediation, Ayr
    Farmers issued an application under rule 14 of the
Rules of Civil Procedure
, R.R.O. 1990, O. Reg. 194, requesting a determination
    of whether Mr. Wright was involved in an accident within the meaning of the Schedule.

[7]

On its application, Ayr Farmers argued
    that the question whether Mr. Wright was involved in an accident is a preliminary
    issue that must be determined before the s. 279 scheme applies.

[8]

Ayr Farmers emphasized that the s.
    279 scheme addresses disputes in respect of any insured persons entitlement to
    statutory accident benefits and that, under the scheme, it is either an insured
    person or an insurer who may submit a dispute to mediation. To qualify as an
    insured person under the Schedule, a SABs claimant must have been involved in
    an accident as defined in the Schedule.

[9]

According to Ayr Farmers, where the
    question whether a claimant was involved in an accident has not been acknowledged
    or determined, the s. 279 scheme does not apply and either the claimant or the insurer
    may apply under rule 14 for a determination of that preliminary issue.

[10]

The application judge rejected Ayr
    Farmers argument, holding that the s. 279 scheme governs all disputes concerning
    entitlement to SABs, including whether a claimant was involved in an accident and
    qualifies as an insured person under the Schedule.

[11]

The application judge also found that
    this was not an appropriate case for an application. In his view, determining whether
    Mr. Wright was involved in an accident would require examining all the surrounding
    circumstances. The only material before the court was a brief line from Mr. Wrights
    application for SABs. In other cases where similar issues had been determined on
    an application, either there were no material facts in dispute or there was an agreed
    statement of fact. That was not the case here, and the question whether Mr. Wright
    was involved in an accident should not be determined on this application.

[12]

Ayr Farmers raises two issues on appeal:
[1]

i)

Is the question whether Mr. Wright was involved in an accident a preliminary
    issue that falls outside the s. 279 scheme?

ii)

If the answer to i) is yes, can the issue be determined by application?

[13]

For the reasons that follow, I conclude
    that the answer to the first question is no. It is therefore unnecessary that I
    respond to the second question. I would also note that while both parties acknowledged
    at the appeal hearing that the s. 279 scheme as it existed as of the date of
    the hearing before the application judge was amended effective April 1, 2016,
[2]
the arguments on this appeal were largely confined to the s. 279 scheme as it existed
    until March 31, 2016. This judgment should not therefore be read as opining on
    the amended scheme.

B.

Is the question whether Mr. Wright was involved in an accident a preliminary
    issue that falls outside the s. 279 scheme?

[14]

Before turning to Ayr Farmers argument,
    I will set out salient portions of the relevant provisions of the SABs statutory
    framework as well as relevant principles of statutory interpretation. The full text
    of all relevant provisions of the Act

and Schedule are set out in Appendix
    A.

(1)

The SABs statutory framework

(i)

Section 268 of the Act

[15]

As I have said, under s. 268(1) of
    the Act,

SABs are provided for in every automobile insurance policy in Ontario.
    Section 268 deems that all such policies include the benefits set out in the
Statutory
    Accident Benefits Schedule
:

268(1).
Every
contract evidenced by a
motor
    vehicle liability policy
, including every such contract in force when the
Statutory
    Accident Benefits Schedule
is made or amended,
shall be deemed to provide
    for the statutory accident benefits set out in the
Schedule

and
    any amendments to the
Schedule,
subject to the terms, conditions, provisions,
    exclusions and limits set out in that
Schedule
. [Emphasis added.]

(ii)

The
    s. 279 scheme

[16]

Sections 279 to 283 of the Act set
    out a mandatory scheme for resolving disputes in respect of any insured persons
    entitlement to statutory accident benefits.

[17]

For the purposes of this appeal, ss.
    279(1), 280(1) and 281(2) are key provisions of the s. 279 scheme. I will set those
    provisions out in full.

[18]

Section 279(1) specifies two forms
    of dispute that must be resolved in accordance with the s. 279 scheme: i) disputes
    in respect of any insured persons entitlement to statutory accident benefits;
    and ii) disputes in respect of the amount of statutory accident benefits to which
    an insured person is entitled. Section 279(1) reads as follows:

279(1) Disputes
in respect of any insured persons
    entitlement to statutory accident benefits
or
in respect of the amount of
    statutory accident benefits to which an insured person is entitled

shall
    be resolved
in accordance with sections 280 to 283 and the
Statutory Accident
    Benefits Schedule.
[Emphasis added.]

[19]

Section 280(1) provides an example
    of the operation of the s. 279 scheme. It specifies that either the insured person
    or the insurer may refer any issue in dispute to a mediator:

280(1) Either
the insured person
or the insurer
may refer to a mediator
any issue in dispute in respect of any insured persons
    entitlement to statutory accident benefits or in respect of the amount of statutory
    accident benefits to which an insured person is entitled. [Emphasis added.]

[20]

Section 281(2) requires parties to
    mediate their disputes before bringing a court proceeding or referring an issue
    to arbitration:

281(2)
No person may bring a proceeding in any court,
    refer the issues in dispute to an arbitrator
under section 282
or agree to
    submit an issue for arbitration
in accordance with the
Arbitration Act, 1991

unless mediation was sought, mediation failed
and, if the issues in dispute
    were referred for an evaluation under section 280.1, the report of the person who
    performed the evaluation has been given to the parties.

[21]

Following a failed
    mediation,
it is the insured who decides the
    forum in which to proceed:
Liberty Mutual Insurance Company v.
    Fernandes
(2006),
82 O.R. (3d) 524
(C.A.), at para. 15. Under
ss. 281(1)(a) and (b), the insured person can choose to either bring a proceeding
    in a court of competent jurisdiction or refer the issues in dispute to an arbitrator
    under section 282.
In contrast, an insurer is limited to requesting the
    insureds consent to submit the issue to arbitration, in accordance with the
Arbitration
    Act
: s. 281(1)(c) of the
Insurance
    Act
.

(iii)

The
    definition of insured person

[22]

Although the s. 279 scheme uses the
    phrase insured person, the Act contains only a limited definition of that term.
    Section 279(3) reads as follow:

279(3) For the purposes of this section and sections 280
    to 284, "insured person" includes a person who is claiming funeral expenses
    or a death benefit under the Statutory Accident Benefits Schedule.

[23]

The Act does, however include a definition
    of insured. Section 224 of the Act reads, in part, as follows:

224(1) In this Part
[3]
,
    []

insured means a person insured by a contract whether
    named or not and includes every person who is entitled to statutory accident benefits
    under the contract whether or not described therein as an insured person.

[24]

The Schedule contains a more complete
    definition of insured person. Section 3(1) of the Schedule reads, in part, as
    follows:

3(1) In this Regulation, []


insured person
 means, in respect of a particular
    motor vehicle liability policy,

(a) the
named
    insured
, any person specified in the policy
as a driver
of the insured
    automobile and, if the named insured is an individual,
the spouse of the named
    insured
and
a dependant
of the named insured or of his or her spouse,

(i)
if
the named insured, specified driver,
    spouse or dependant
is involved in an accident
in or outside Ontario that
    involves the insured automobile or another automobile, or

(ii) if the named insured, specified driver, spouse
    or dependant is not involved in an accident but suffers psychological or mental
    injury
as a result of an accident
in or outside Ontario that results in a
    physical injury to his or her spouse, child, grandchild, parent, grandparent, brother,
    sister, dependant or spouses dependant,

(b)
a person
who is
involved
    in an accident involving the insured automobile
, if the accident occurs in Ontario,
    or

(c) a person who is
an occupant
    of the insured automobile
and who is a resident of Ontario or was a resident
    of Ontario at any time during the 60 days before the accident, if the accident occurs
    outside Ontario; [] [Emphasis added.]

[25]

It is well established that the definition
    of insured person in the Schedule governs the entitlement to SABs:

Warwick
    v. Gore Mutual Insurance Co.
(1997), 32 O.R.
    (3d) 76 (C.A.)
[4]
.
    Under this definition, Mr. Wright will qualify as an insured person only if he
    was involved in an accident, which is also defined in s. 3(1) of the Schedule:

3(1) In this Regulation,


accident
means
an incident in which the use
    or operation of an automobile directly causes an impairment or directly causes damage
to any prescription eyewear, denture, hearing aid, prosthesis or other medical or
    dental device; [] [Emphasis added.]

(2)

Relevant Principles of Statutory Interpretation

[26]

The modern approach to statutory interpretation
    requires that the words of a statute be read "in their entire context and in
    their grammatical and ordinary sense harmoniously with the scheme of the Act, the
    object of the Act, and the intention of Parliament": see
Rizzo &
    Rizzo Shoes Ltd. (Re)
,
[1998] 1 S.C.R. 27, at
    para. 21, quoting from Elmer Driedger,
Construction of Statutes
, 2d ed.
    (Toronto: Butterworths, 1983), at p. 87. See also
Bell ExpressVu Limited Partnership
    v. Rex
, 2002 SCC 42, [2002] 2 S.C.R. 559, at para. 26;
Wilson v. British
    Columbia (Superintendent of Motor Vehicles)
, 2015 SCC 47, [2015] 3 S.C.R. 300,
    at para. 18;
Heritage Capital Corp. v. Equitable Trust Co.
, 2016 SCC 19,
    395 D.L.R. (4th) 656, at para. 27;
Rooney v. ArcelorMittal S.A.
,
2016 ONCA 630, at paras. 10-21.

[27]

The rules governing statutory interpretation
    apply equally to regulations. Importantly, a regulation must be read in the context
    of the enabling Act, having regard to the purpose of the enabling provisions:
Bristol-Myers
    Squibb Co. v. Canada (Attorney General)
, 2005 SCC 26, [2005] 1 S.C.R. 533,
    at paras. 37-38.

[28]

The modern approach to statutory interpretation
    involves a textual, contextual and purposive analysis of the statute or provision
    in question.

[29]

Three factors must be examined: the
    language of the provision, the context in which the language is used and the purpose
    of the legislation or statutory scheme in which the language is found:
Blue
    Star Trailer Rentals Inc. v. 407 ETR Concession Co.
,
2008 ONCA 561,
91 O.R. (3d) 321
, at para. 23.

[30]

In
Amos v. Insurance Corporation
    of British Columbia
,
[1995] 3 S.C.R. 405
,
at para. 17, Major J. observed that although statutory language cannot be stretched beyond
    its ordinary meaning, the statute cannot be construed in such a way that defeats
    the object and intent of the legislation providing coverage to the insured person.

[31]

In Ontario, the
Legislation
    Act, 2006
,
S.O. 2006
, c. 21, provides additional guidance regarding the interpretation
    of legislation.

[32]

Section 64(1) of the
Legislation
    Act

states that [a]n Act shall be interpreted as being remedial and shall be
    given such fair, large and liberal interpretation as best ensures the attainment
    of its objects.

[33]

Section 64(2) provides that rule of
    liberal interpretation also applies to regulations, in the context of the Act under
    which [the regulation] is made and to the extent that the regulation is consistent
    with that Act.

(3)

Ayr Farmers position on appeal

[34]

On appeal, Ayr Farmers acknowledges
    that the s. 279 scheme is a complete code for dealing with disputes between an
insured person
and an insurer
    concerning SABs issues, including entitlement to particular kinds of benefits having
    regard to the injuries sustained and amounts payable. However, it relies on the
    fact that to qualify as an insured person as defined in the Schedule, Mr. Wright
    must have been involved in an accident, a term which is also defined in the Schedule.

[35]

Ayr Farmers submits that the question
    whether Mr. Wright was involved in an accident  and therefore whether he qualifies
    as an insured person under the s. 279 scheme  is not a SABs issue but rather a
    coverage issue. According to Ayr Farmers, before the s. 279 scheme is triggered,
    the coverage issue must first be determined.

[36]

Ayr Farmers contends that coverage
    issues are generally relatively simple. It says they can be more expeditiously and
    efficiently dealt with on a rule 14 application rather than under the s. 279 scheme.
    Coverage exists, or it does not. Coverage issues do not typically benefit from mediation.
    If the application judges interpretation is followed, it will deprive both insurers
    and SABs claimants of the ability to resort to the courts for an expeditious determination
    of a discrete issue that is unlikely to benefit from the processes built in to the
    s. 279 scheme.

[37]

Ayr Farmers says the application judge
    erred because he conflated the definition of an insured under s. 224 of the Act
    with the definition of insured person under the Schedule. Mr. Wright is not entitled
    to invoke the 279 scheme just because he is a named insured in the policy. The s.
    279 scheme deals with an insured persons entitlement to SABs benefits. To qualify
    as an insured person under the Schedule it is not enough that Mr. Wright is a named
    insured  he must also have been involved in an accident as defined in the Schedule.

(4)

Discussion

[38]

I would not accept Ayr Farmers arguments.
    Adopting a purposive approach to interpreting the s. 279 scheme, in my view, the
    application judge was correct in holding that it governs all disputes concerning
    entitlement to SABs, including whether a claimant was involved in an accident. I
    reach this conclusion for three reasons.

[39]

First, the s. 279 scheme establishes
    a comprehensive alternative process to the courts that includes a separate administrative
    body for resolving disputes between SABs claimants and insurers concerning
    entitlement to and the amount of benefits. The s. 279 scheme limits access to the
    courts and incentivizes claimants to pursue arbitration rather than litigation.
    In my view, interpreting the s. 279 scheme in a manner that would require either
    the SABs claimant or an insurer to apply to court for a preliminary determination
    of whether a claimant qualifies as an insured person is inconsistent with the creation
    of a comprehensive alternative dispute resolution process.

[40]

SABs were introduced in Ontario on
    June 1, 1990 as part of a threshold no-fault automobile insurance regime that limited
    the right to sue in tort to cases where injured parties met the threshold of permanent
    serious physical impairment: James Flaherty and Catherine Zingg,
Accident
    Benefits in Ontario
, loose-leaf (Toronto: Thomson
    Reuters Canada, 2016), at pp. 1-4, 1-5.

[41]

At the time SABs were introduced, the
    legislature also created a body, the Ontario Insurance Commission, as the new regulator
    of the insurance industry:
Insurance Statute Law Amendment Act, 1990
, S.O. 1990, c. 2. Later, in 1997, the Commission was succeeded
    by the Financial Services Commission of Ontario (FSCO):
Financial
    Services Commission of Ontario Act, 1997
,
    S.O. 1997, c. 28. FSCO was given a broad mandate that included regulatory, supervisory
    and dispute resolution responsibilities and powers: Flaherty and Zingg, at p.1-1.

[42]

Until April 1, 2016, the Dispute Resolution
    Services (DRS) branch at FSCO was responsible for resolving disputes that fell
    within the s. 279 scheme.

In
Chisholm v. Liberty Mutual Group
(2002),

60 O.R. (3d) 776
, at para. 21 (C.A.),
[5]
Laskin J.A. cited FSCO decisions on entitlement with approval and described FSCO
    as a specialized body of arbitrators who routinely adjudicate claims for accident
    benefits.

[43]

Section 281(2) of the Act expressly
    states that
no person
may

bring a proceeding in any court unless mediation
    was sought and failed.

[44]

Further
, if mediation fails, the s. 279 scheme incentivizes insured
    persons to refer issues in dispute to arbitration under s. 282 rather than commencing
    court proceedings. For example, under s. 282(10) of the Act, if a s. 282 arbitrator
    finds that an insurer unreasonably withheld or delayed SABs payments, the arbitrator
    shall award a lump sum of up to 50 per cent of the amount to which the person was
    entitled at the time of the award with interest on the amount at the rate of two
    per cent per month. This remedy is only available if an insured person proceeds
    to arbitration with FSCO under s. 282. It thus encourages use of these services
    and also provides protection against insurers who unreasonably deny SABs claims.

[45]

Viewed in the context of this comprehensive
    alternative dispute resolution scheme, I consider it unlikely that the legislature
    intended that SABs claimants or insurers would have to bring court proceedings to
    trigger the s. 279 scheme.

[46]

Second, while court proceedings
might
provide a more expeditious
    process where it is determined a SABs claimant does not qualify as an insured
    person, a court proceeding would be duplicative and counter-productive where a SABs
    claimant
does
qualify as an insured person.

[47]

Because of the prohibition against
    commencing court proceedings prior to mediation in s. 281(2), the only issue that
    could be determined on a preliminary court proceeding in a case such as this is
    the question whether the SABs claimant qualifies as an insured person. On the other
    hand, if that question falls to be determined under the s. 279 scheme, in the
    event mediation fails, the claimant is then immediately entitled to choose to proceed
    with all issues, either by arbitration or litigation.

[48]

Viewed in this context, I consider
    it unlikely that the legislature intended to create a bifurcated process under which
    either the SABs claimant or the insurer would have to bring a court proceeding before
    advancing their claim under the s. 279 scheme. Proceeding in that way would only
potentially
be
    faster if it were ultimately determined that the claimant did not qualify as an
    insured person. Moreover, it would deprive SABs claimants of their right under the
    s. 279 to make the choice of forum.

[49]

Third, having regard to the purposes
    of the Act and the s. 279 scheme, insured person as it appears in the s. 279 scheme
    can reasonably be read as encompassing all persons
claiming
entitlement to benefits
    under the Schedule whether or not it is ultimately determined that they are entitled
    to benefits.

[50]

That reading, after all, is consistent
    with the language of the definition of insured person contained in s. 279(3) of
    the Act, which provides that insured person includes a person who is
claiming
funeral expenses
    or a death benefit under the Schedule. Moreover, it is consistent with the legislatures
    intention of creating a comprehensive, expeditious and efficient dispute resolution
    scheme.

C.

Disposition

[51]

Based on the foregoing reasons, I would
    dismiss the appeal with costs to the respondent on a partial indemnity scale in
    the agreed upon amount of $10,000 for the appeal and $10,000 for the application
    below, inclusive of disbursements and applicable taxes, for a total of $20,000.

Released:

OCT 27 2016                                    Janet
    Simmons J.A.

JS                                                     I
    agree E.E. Gillese J.A.

I
    agree C.W. Hourigan J.A.


Appendix A

Insurance Act
,
R.S.O.
    1990, c. I.
8

Part VI Automobile Insurance

Interpretation, Part VI

224.

(1) In
    this Part,

automobile includes,

(a) a motor vehicle required under any Act to be
    insured under a motor vehicle liability policy, and

(b) a vehicle prescribed by regulation to be an
    automobile; (automobile)

contract means a contract of automobile insurance
    that,

(a) is undertaken by an insurer that is licensed
    to undertake automobile insurance in Ontario, or

(b) is evidenced by a policy issued in another
    province or territory of Canada, the United States of America or a jurisdiction
    designated in the

Statutory Accident
    Benefits Schedule

by an insurer
    that has filed an undertaking under section 226.1; (contrat)

excluded driver means a person named as an excluded
    driver in an endorsement under section 249; (conducteur exclu)

fault determination rules means the rules
    prescribed under paragraph 21 of subsection 121 (1); (règles de détermination
    de la responsabilité)

health care includes all goods and services for
    which payment is provided by the medical, rehabilitation and attendant care
    benefits provided for in the

Statutory
    Accident Benefits Schedule
; (soins de santé)

insured means a person insured by a contract
    whether named or not and includes every person who is entitled to statutory
    accident benefits under the contract whether or not described therein as an
    insured person; (assuré)

listed expenses means, in connection with statutory
    accident benefits, the amounts payable that, under section 288.1, are listed
    expenses;  (frais désignés)

occupant, in respect of an automobile, means,

(a) the driver,

(b) a passenger, whether being carried in or on
    the automobile,

(c) a person getting into or on or getting out of
    or off the automobile; (personne transportée)

public transit means,

(a) any service for which a fare is charged for
    transporting the public by automobiles operated by or on behalf of a
    municipality or a local board as defined in the

Municipal Affairs Act
, or under an
    agreement between a municipality and a person, firm or corporation, but does
    not include special transportation facilities for persons with disabilities or
    transportation by special purpose facilities such as school buses or
    ambulances, and

(b) any service prescribed by regulation to be
    public transit, in the circumstances and subject to the terms, conditions,
    provisions, exclusions and limits prescribed by the regulation,

but does not include any service prescribed by
    regulation not to be public transit, in the circumstances and subject to the
    terms, conditions, provisions, exclusions and limits prescribed by the
    regulation; (transport en commun)

public transit vehicle means an automobile while
    being used for public transit; (véhicule de transport en commun)

service providers licence means a
    licence issued under section 288.5;  (permis de fournisseur de services)

spouse means either of two persons who,

(a) are married to each other,

(b) have together entered into a marriage that is
    voidable or void, in good faith on the part of the person asserting a right
    under this Act, or

(c) have lived together in a conjugal relationship
    outside marriage,

(i) continuously for a
    period of not less than three years, or

(ii) in a relationship
    of some permanence, if they are the natural or adoptive parents of a child;
    (conjoint)

statutory accident benefits means the benefits set
    out in the regulations made under paragraphs 9 and 10 of subsection 121 (1);
    (indemnités daccident légales)


Statutory Accident Benefits Schedule
 means
    the regulations made under paragraphs 9 and 10 of subsection 121 (1). (
Annexe
    sur les indemnités daccident légales
)

Transition

(2) A reference to Schedule C in any other Act or in
    any regulation, contract or other instrument shall, in respect of events
    occurring after the 21st day of June, 1990, be deemed to be a reference to the

Statutory Accident Benefits Schedule

and a reference to benefits under Schedule
    C shall be deemed to be a reference to statutory accident benefits.

Idem

(3) Every contract to which subsection 268 (1)
    applies shall be deemed to have been amended on the 22nd day of June, 1990, to
    include statutory accident benefits in accordance with the

Statutory Accident Benefits Schedule.

Idem

(4) The benefits of a person who, before the 22nd day
    of June, 1990, was entitled to benefits under Schedule C shall be determined in
    accordance with the

Insurance Act
,
    being chapter 218 of the Revised Statutes of Ontario, 1980, as that Act read
    immediately before the 22nd day of June, 1990.

Idem

(5) For the purposes of subsections (2) and (4),

Schedule C means Schedule C to the

Insurance Act
, being chapter 218
    of the Revised Statutes of Ontario, 1980, as that Act read before the 22nd day
    of June, 1990.

Additional benefits

(6) An insurer, with the approval of the
    Superintendent, may offer optional benefits in excess of the benefits that must
    be provided under the

Statutory
    Accident Benefits Schedule
.

Idem

(7) Optional benefits offered under subsection (6)
    shall be deemed to be statutory accident benefits and the

Statutory Accident Benefits Schedule

applies to them with necessary
    modifications.



Statutory accident benefits

268.

(1)
    Every contract evidenced by a motor vehicle liability policy, including every
    such contract in force when the

Statutory
    Accident Benefits Schedule

is
    made or amended, shall be deemed to provide for the statutory accident benefits
    set out in the

Schedule
and
    any amendments to the

Schedule
,
    subject to the terms, conditions, provisions, exclusions and limits set out in
    that

Schedule
.

Exception, public transit vehicles

(1.1) Despite subsection (1) and the

Statutory Accident Benefits Schedule
,
    no statutory accident benefits are payable in respect of an occupant of a
    public transit vehicle, in respect of an incident that occurs on or after the
    date this subsection comes into force, if the public transit vehicle did not
    collide with another automobile or any other object in the incident.

(1.2), (1.3)

Repealed
:

1996,
    c. 21, s. 30 (1).

Indexation

(1.4) Subject to subsection (1.5) and to the terms,
    conditions, provisions, exclusions and limits established by the

Statutory Accident Benefits Schedule
,
the Schedule

shall
    provide that, in respect of incidents involving the use or operation, after
    December 31, 1993 and before section 29 of the

Automobile Insurance Rate Stability
    Act, 1996

comes into force, of an
    automobile,

(a) every continuing periodic amount payable by an
    insurer as an income replacement benefit, education disability benefit,
    caregiver benefit or loss of earning capacity benefit in accordance with the

Schedule

shall be revised, effective the 1st day of
    January in every year after 1994, using the indexation percentage published
    under subsection 268.1 (1); and

(b) every monetary amount set out in the

Schedule

shall be revised, effective the 1st day of
    January in every year after 1994, by adjusting the amount by the indexation
    percentage published under subsection 268.1 (1).

No decrease in payments

(1.5) A continuing periodic amount payable by an
    insurer in accordance with the

Statutory
    Accident Benefits Schedule

shall
    not be reduced by the operation of the indexation percentage referred to in
    subsection (1.4).

Liability to pay

(2) The following rules apply for determining who is
    liable to pay statutory accident benefits:

1. In respect of an occupant of an automobile,

i. the occupant has
    recourse against the insurer of an automobile in respect of which the occupant
    is an insured,

ii. if recovery is
    unavailable under subparagraph i, the occupant has recourse against the insurer
    of the automobile in which he or she was an occupant,

iii. if recovery is
    unavailable under subparagraph i or ii, the occupant has recourse against the
    insurer of any other automobile involved in the incident from which the
    entitlement to statutory accident benefits arose,

iv. if recovery is
    unavailable under subparagraph i, ii or iii, the occupant has recourse against
    the Motor Vehicle Accident Claims Fund.

2. In respect of non-occupants,

i. the non-occupant has
    recourse against the insurer of an automobile in respect of which the
    non-occupant is an insured,

ii. if recovery is
    unavailable under subparagraph i, the non-occupant has recourse against the
    insurer of the automobile that struck the non-occupant,

iii. if recovery is
    unavailable under subparagraph i or ii, the non-occupant has recourse against
    the insurer of any automobile involved in the incident from which the
    entitlement to statutory accident benefits arose,

iv. if recovery is
    unavailable under subparagraph i, ii or iii, the non-occupant has recourse
    against the Motor Vehicle Accident Claims Fund.

Liability

(3) An insurer against whom a person has recourse for
    the payment of statutory accident benefits is liable to pay the benefits.

Choice of insurer

(4) If, under subparagraph i or iii of paragraph 1 or
    subparagraph i or iii of paragraph 2 of subsection (2), a person has recourse
    against more than one insurer for the payment of statutory accident benefits,
    the person, in his or her absolute discretion, may decide the insurer from
    which he or she will claim the benefits.

Same

(5) Despite subsection (4), if a person is a named
    insured under a contract evidenced by a motor vehicle liability policy or the
    person is the spouse or a dependant, as defined in the

Statutory Accident Benefits Schedule
,
    of a named insured, the person shall claim statutory accident benefits against
    the insurer under that policy.

Same

(5.1) Subject to
    subsection (5.2), if there is more than one insurer against which a person may
    claim benefits under subsection (5), the person, in his or her discretion, may
    decide the insurer from which he or she will claim the benefits.

Same

(5.2) If there is more than one insurer against which
    a person may claim benefits under subsection (5) and the person was, at the
    time of the incident, an occupant of an automobile in respect of which the
    person is the named insured or the spouse or a dependant of the named insured,
    the person shall claim statutory accident benefits against the insurer of the
    automobile in which the person was an occupant.

Excess insurance

(6) The insurance mentioned in subsection (1) is
    excess insurance to any other insurance not being automobile insurance of the
    same type indemnifying the injured person or in respect of a deceased person
    for the expenses.

Idem

(7) The insurance mentioned in subsection (1) is
    excess insurance to any other insurance indemnifying the injured person or in
    respect of a deceased person for the expenses.

Payments pending dispute resolution

(8) Where the

Statutory
    Accident Benefits Schedule

provides
    that the insurer will pay a particular statutory accident benefit pending
    resolution of any dispute between the insurer and an insured, the insurer shall
    pay the benefit until the dispute is resolved.

Dispute Resolution  Statutory Accident Benefits

Dispute Resolution

279.

(1) Disputes in respect of any insured
    persons entitlement to statutory accident benefits or in respect of the amount
    of statutory accident benefits to which an insured person is entitled shall be
    resolved in accordance with sections 280 to 283 and the

Statutory
    Accident Benefits Schedule
.

Opting out

(2) Any restriction on a partys right to mediate,
    litigate, appeal or apply to vary an order as provided in sections 280 to 284,
    or on a partys right to arbitrate under section 282, is void except as provided
    in the regulations.

Meaning of insured person, ss. 279 to 284

(3) For the purposes of this section and sections 280
    to 284,

insured person includes a person who is claiming
    funeral expenses or a death benefit under the

Statutory Accident Benefits Schedule
.

Orders

(4) The Director and every arbitrator appointed by
    the Director shall determine issues before them by order and may make an order
    subject to such conditions as are set out in the order.

Interim orders

(4.1) The Director and every arbitrator appointed by
    the Director may make interim orders pending the final order in any matter
    before the Director or arbitrator.

Power to bind parties

(5) If an insurer or an insured is represented in a
    mediation under section 280, an evaluation under section 280.1, an arbitration
    under section 282, an appeal under section 283 or a variation proceeding under
    section 284, the mediator, person performing the evaluation, arbitrator or
    Director, as the case may be, may adjourn the proceeding, with or without
    conditions, if the representative is not authorized to bind the party he or she
    represents.

Mediation

280.

(1) Either the insured person or the
    insurer may refer to a mediator any issue in dispute in respect of the insured
    persons entitlement to statutory accident benefits or in respect of the amount
    of statutory accident benefits to which the insured person is entitled.

Starting the process

(2) The party seeking mediation shall file an
    application for the appointment of a mediator with the Commission.

Mediators appointment

(3) The Director shall ensure that a mediator is
    appointed promptly.

Mediation

(4) The mediator shall enquire into the issues in
    dispute and attempt to effect a settlement of as many of the issues as possible
    within the time prescribed in the regulations for the settlement of the type of
    dispute in question.

Extension of time

(5) The parties may by agreement extend the time for
    the completion of the mediation process, even if the time for completion has
    expired.

Notice of failure

(6) If at any time before a settlement is effected
    the mediator is of the opinion that mediation will fail, he or she shall
    forthwith notify the parties.

Idem

(7) Mediation has failed when the mediator has given
    notice to the parties that in his or her opinion mediation will fail, or when
    the prescribed or agreed time for mediation has expired and no settlement has
    been reached.

Report

(8) If mediation fails, the mediator, in addition to
    any notice required to be given, shall prepare and give to the parties a
    report,

(a) setting out the
    insurers last offer and the mediators description of the issues that remain
    in dispute;

(b) containing a list of
    materials requested by the parties that have not been produced and that, in the
    opinion of the mediator, were required for the purpose of discussing a
    settlement of the issues; and

(c) containing a
    recommendation as to whether or not the issues in dispute should be referred
    for an evaluation under section 280.1.

Same

(9) The mediator may give his or her report to a
    person performing an evaluation under section 280.1 or an arbitrator conducting
    an arbitration under section 282.

Neutral evaluation

280.1

(1) If mediation fails, the parties
    jointly or the mediator who conducted the mediation may, for the purpose of
    assisting in the resolution of the issues in dispute, refer the issues in
    dispute to a person appointed by the Director for an evaluation of the probable
    outcome of a proceeding in court or an arbitration under section 282.

Evaluators appointment

(2) The Director shall ensure that a person is
    appointed promptly to perform the evaluation.

Information

(3) The insurer and the insured person shall provide
    the person performing the evaluation with any information that he or she
    requests.

Opinion and report

(4) The person performing the evaluation shall give
    the parties,

(a) an oral opinion on the probable outcome of a
    proceeding in court or an arbitration under section 282; and

(b) a written report,

(i) stating that the
    issues in dispute were evaluated by the person,

(ii) identifying the
    issues that were evaluated,

(iii) identifying the
    issues that remain in dispute,

(iv) setting out the
    insurers last offer, and

(v) containing a list of
    materials requested by the person performing the evaluation that were not
    provided by the parties.

Same

(5) The person who performed the evaluation may give
    his or her written report to an arbitrator conducting an arbitration under
    section 282.

Litigation or arbitration

281.

(1) Subject to subsection (2),

(a) the insured person may bring a proceeding in a
    court of competent jurisdiction;

(b) the insured person may refer the issues in
    dispute to an arbitrator under section 282; or

(c) the insurer and the insured person may agree
    to submit any issue in dispute to any person for arbitration in accordance with
    the

Arbitration
    Act, 1991
.

Limitation

(2) No person may bring a proceeding in any court,
    refer the issues in dispute to an arbitrator under section 282 or agree to
    submit an issue for arbitration in accordance with the

Arbitration
    Act, 1991

unless
    mediation was sought, mediation failed and, if the issues in dispute were
    referred for an evaluation under section 280.1, the report of the person who
    performed the evaluation has been given to the parties.

Payment pending dispute resolution

(3) Subject to subsection (4), if mediation fails,
    the insurer shall pay statutory accident benefits in accordance with the last
    offer of settlement that it had made before the failure until otherwise agreed
    by the parties or until otherwise ordered by a court, by an arbitrator acting
    under this Act or the

Arbitration Act, 1991
, or by the Director.

Same

(4) If a dispute involves a statutory accident
    benefit that the insurer is required to pay under subsection 268 (8) and no
    step authorized by subsection (1) has been taken within 45 days after the day
    mediation failed, the insurer shall pay the insured in accordance with the last
    offer made by the insurer before the failure until otherwise agreed by the
    parties or until otherwise ordered by a court, by an arbitrator acting under
    this Act or the

Arbitration
    Act, 1991
, or by the Director.

(5) Repealed:  2002, c. 24, Sched. B, s. 39 (5).

Limitation period

281.1

(1) A mediation proceeding or evaluation
    under section 280 or 280.1 or a court proceeding or arbitration under section
    281 shall be commenced within two years after the insurers refusal to pay the
    benefit claimed.

Exception

(2) Despite subsection (1), a proceeding or
    arbitration under clause 281 (1) (a) or (b) may be commenced,

(a) if there is an evaluation under section 280.1,
    within 30 days after the person performing the evaluation reports to the
    parties under clause 280.1 (4) (b);

(b) if mediation fails but there is no evaluation
    under section 280.1, within 90 days after the mediator reports to the parties
    under subsection 280 (8).

Arbitration

282.

(1) An insured person seeking arbitration
    under this section shall file an application for the appointment of an
    arbitrator with the Commission.

Arbitrators appointment

(2) The Director shall ensure that an arbitrator is
    appointed promptly.

Determination of issues

(3) The arbitrator shall determine all issues in
    dispute, whether the issues are raised by the insured person or the insurer.

Procedures

(4) The arbitration shall be conducted in accordance
    with the procedures and within the time-limits set out in the regulations.

(5)-(9)

Repealed
:

1996,
    c. 21, s. 38 (3).

Special award

(10) If the arbitrator finds that an insurer has
    unreasonably withheld or delayed payments, the arbitrator, in addition to
    awarding the benefits and interest to which an insured person is entitled under
    the

Statutory
    Accident Benefits Schedule
, shall award a lump sum of up to 50 per cent of
    the amount to which the person was entitled at the time of the award together
    with interest on all amounts then owing to the insured (including unpaid
    interest) at the rate of 2 per cent per month, compounded monthly, from the
    time the benefits first became payable under the

Schedule
.

Expenses

(11) The arbitrator may award, according to criteria
    prescribed by the regulations, to the insured person or the insurer, all or
    part of such expenses incurred in respect of an arbitration proceeding as may
    be prescribed in the regulations, to the maximum set out in the regulations.

Interim award of expenses

(11.1) The arbitrator may at any time during an
    arbitration proceeding make an interim award of expenses, subject to such terms
    and conditions as may be established by the arbitrator.

Liability of representative for costs

(11.2) An arbitrator may make an order requiring a
    person representing an insured person or an insurer for compensation in an
    arbitration proceeding to personally pay all or part of any expenses awarded
    against a party if the arbitrator is satisfied that,

(a) in respect of a representative of an insured
    person, the representative commenced or conducted the proceeding without
    authority from the insured person or did not advise the insured person that he
    or she could be liable to pay all or part of the expenses of the proceeding;

(b) in respect of a representative of an insured
    person, the representative caused expenses to be incurred without reasonable
    cause by advancing a frivolous or vexatious claim on behalf of the insured
    person; or

(c) the representative caused expenses to be
    incurred without reasonable cause or to be wasted by unreasonable delay or
    other default.

Non-application to solicitors

(11.3) Clause (11.2) (a) does not apply to a
    barrister or solicitor acting in the usual course of the practice of law.

Opportunity to make representations

(11.4) An order under subsection (11.2) shall not be
    made unless the representative is given a reasonable opportunity to make
    representations to the arbitrator.

Bias

(12) A party may apply to the Director for the
    appointment of a new arbitrator if the party believes that the arbitrator is
    biased and the Director shall determine the issue.

Copies of decision

(13) The arbitrator, forthwith upon making a decision
    in an arbitration, shall deliver a copy of his or her order together with a
    copy of the arbitrators written reasons, if any, to the insured person, the
    insurer and the Director.

(14), (15)

Repealed
:  1996, c. 21, s. 38 (6).

Non-application of the

Arbitration Act, 1991

(16) The

Arbitration Act, 1991

does not
    apply to arbitrations under this section.

Appeal against arbitration order

283.

(1) A party to an arbitration under
    section 282 may appeal the order of the arbitrator to the Director on a
    question of law.

Notice of appeal

(2) A notice of appeal shall be in writing and shall
    be delivered to the Commission within thirty days after the date of the
    arbitrators order and the appellant shall serve the notice on the respondent.

Extension of time for appeal

(3) The Director may
    extend the time for requesting an appeal, before or after the time for
    requesting the appeal has expired, if the Director is satisfied that there are
    reasonable grounds for granting the extension, and the Director may give such
    directions as he or she considers proper as a condition of granting the
    extension.

Nature of appeal

(4) The Director may determine the appeal on the
    record or in such other manner as the Director may decide, with or without a
    hearing.

Power of the Director

(5) The Director may confirm, vary or rescind the
    order appealed from or substitute his or her order for that of the arbitrator.

Order not stayed

(6) An appeal does not stay the order of the
    arbitrator unless the Director decides otherwise.

Medical reports, special awards, expenses

(7) Subsections 282 (10) to (11.2) apply with
    necessary modifications to appeals before the Director.

Interventions

(8) The Director may permit persons who are not
    parties to the appeal to make submissions on issues of law arising in an
    appeal.

(9), (10)

Repealed
:

1996,
    c. 21, s. 39 (5).

Statutory Accident Benefits Schedule  Effective
    September 1, 2010,
O. Reg. 34/10



Definitions and Interpretation

3.

(1) In
    this Regulation,

accident means an incident in which the use or
    operation of an automobile directly causes an impairment or directly causes
    damage to any prescription eyewear, denture, hearing aid, prosthesis or other
    medical or dental device; (accident)



insured automobile means, in respect of a
    particular motor vehicle liability policy, an automobile covered by the policy;
    (automobile assurée)

insured person means, in respect of a particular
    motor vehicle liability policy,

(a) the named insured, any person specified in the
    policy as a driver of the insured automobile and, if the named insured is an
    individual, the spouse of the named insured and a dependant of the named
    insured or of his or her spouse,

(i) if the named
    insured, specified driver, spouse or dependant is involved in an accident in or
    outside Ontario that involves the insured automobile or another automobile, or

(ii) if the named
    insured, specified driver, spouse or dependant is not involved in an accident
    but suffers psychological or mental injury as a result of an accident in or
    outside Ontario that results in a physical injury to his or her spouse, child,
    grandchild, parent, grandparent, brother, sister, dependant or spouses
    dependant,

(b) a person who is involved in an accident
    involving the insured automobile, if the accident occurs in Ontario, or

(c) a person who is an occupant of the insured
    automobile and who is a resident of Ontario or was a resident of Ontario at any
    time during the 60 days before the accident, if the accident occurs outside
    Ontario; (personne assurée)



Old Regulation means Ontario Regulation 403/96
    (Statutory Accident Benefits Schedule  Accidents on or After November 1,
    1996), made under the Act; (ancien règlement)

Mediation proceeding

55.

An
    insured person shall not commence a mediation proceeding under section 280 of
    the Act if any of the following circumstances exist:

1. The insured person has not notified the insurer
    of the circumstances giving rise to a claim for a benefit or has not submitted
    an application for the benefit within the times prescribed by this Regulation.

2. The insurer has provided the insured person
    with notice in accordance with this Regulation that it requires an examination
    under section 44, but the insured person has not complied with that section.

3. The issue in dispute relates to the insurers
    denial of liability to pay an amount under an invoice on the grounds that,

i. the insurer requested
    information from a provider under subsection 46.2 (1), and

ii. the insurer is
    unable, acting reasonably, to determine its liability for the amount payable
    under the invoice because the provider has not complied with the request in
    whole or in part.

Time limit for proceedings

56.

(1) A
    mediation proceeding or evaluation under section 280 or 280.1 of the Act or a
    court proceeding or arbitration under clause 281 (1) (a) or (b) of the Act in
    respect of a benefit shall be commenced within two years after the insurers
    refusal to pay the amount claimed.

(2) Despite subsection (1), a court proceeding or
    arbitration under clause 281 (1) (a) or (b) of the Act may be commenced within
    90 days after the mediator reports to the parties under subsection 280 (8) of the
    Act or within 30 days after the person performing the evaluation provides a
    report to the parties under section 280.1 of the Act, whichever is later.





[1]

In its factum, Ayr Farmers raised a third issue, namely, the question
    whether Mr. Wright was involved in an accident. In oral argument on appeal, Ayr
    Farmers requested that this issue be remitted to the Superior Court if the answer
    to the first two questions is yes.



[2]
The
Fighting Fraud and Reducing Automobile Insurance Rates Act, 2014
,
S.O. 2014, c. 9, also known as Bill 15, came into force on April 1, 2016.
    Among other things, it amends the s. 279 scheme.



[3]

This is a reference to
Part VI of the Act, which
    relates to Automobile Insurance.



[4]

Warwick
was decided under the
No-Fault
    Benefits Schedule
, R.R.O. 1990, Reg. 672, but the
    principles remain applicable.



[5]

In
Chisholm
, the SABs
    claimant brought an action for payment of SABs after mediation failed to
    resolve the issues between the parties. The insurer then moved under rule 21
    for a determination whether it was legally obliged to pay benefits, a question
    that turned on whether the use or operation of an automobile directly caused
    his injuries. This court held that to succeed on appeal, the claimant had to
    persuade the court that he was involved in an accident.


