



COURT OF APPEAL FOR ONTARIO

CITATION: Intact Insurance Company v. Federated Insurance
    Company of Canada, 2017 ONCA 73

DATE: 20170127

DOCKET: M46124, C62225

Doherty, MacPherson and Lauwers JJ.A.

IN THE MATTER
of the
Insurance Act
, RSO 1990, c. I.8, as amended, and Regulation
    283/95;

AND IN THE MATTER
of the
Arbitration Act
, SO 1991, c. 17;

AND IN THE MATTER
of an Arbitration;

BETWEEN

Intact Insurance Company

Applicant

(Respondent in Appeal)

and

Federated Insurance Company of Canada
,
Old Republic
    Insurance

Company
    of Canada and Her Majesty the Queen the Motor Vehicle

Accident
    Claims Fund

Respondent

(Appellant in Appeal)

Greg Bailey and Bevin Shores, for the appellant

Joseph Lin and Dana Yoon, for the respondent

Heard: December 8, 2016

On appeal from the order of Justice James F. Diamond of
    the Superior Court of Justice, dated February 2, 2016, with reasons reported at
    2016 ONSC 719, 129 O.R. (3d) 549.

Doherty J.A.:


I



overview

[1]

This appeal arises out of a priority dispute between two insurers.  The
    court must decide whether the abuse of process doctrine as described in
Toronto
    (City) v. C.U.P.E., Local 79
,
2003 SCC 63, [2003] 3 S.C.R. 77 (
CUPE
), precluded the appellant
    (Federated) from leading evidence at an arbitration that the vehicle in which
    the injured person was a passenger was covered by an automobile insurance policy
    issued by the respondent (Intact).  The driver of the vehicle had previously
    been convicted of driving without insurance at the time of the accident.

[2]

The arbitrator held that the abuse of process doctrine should not
    prevent Federated from leading evidence that the driver was in fact insured at
    the time of the accident.  On appeal, the application judge reversed the
    arbitrator, holding that the issue could not be re-litigated in the context of
    the arbitration.

[3]

This court granted leave to appeal from the application judges order. 
    I would allow the appeal and restore the arbitrators order.


II



facts

[4]

On April 25, 2010, a vehicle driven by Patrick Cadieux collided with a
    truck.  Mr. Cadieuxs four-year-old son, a passenger in his vehicle, suffered
    significant injuries in the crash.  The son claimed Statutory Accident Benefits
    under the
Insurance Act
, R.S.O. 1990, c. I.8.

[5]

The Cadieux vehicle had been insured by Intact.  Intact claimed,
    however, that it had cancelled the policy five days before the accident for
    non-payment of premiums.  Federated insured the truck involved in the accident.

[6]

Under the provisions of s. 268(2)1.(ii) of the
Insurance Act
,
    Intact was responsible to pay the Statutory Accident Benefits if it was the
    insurer of the Cadieux vehicle at the time of the accident.  If, however, that policy
    had been cancelled before the accident, then responsibility for payment of the
    Statutory Accident Benefits would fall on Federated as the insurer of the other
    vehicle involved in the accident:
Insurance Act
, ss. 268(2)1.(ii) and
    (iii).

[7]

Intact and Federated were obligated to arbitrate their dispute pursuant to
    regulations under the
Insurance Act
.  They entered into an arbitration
    agreement which, among other things, empowered the arbitrator to determine
    procedural and interlocutory matters on the arbitration.  Intact paid Mr. Cadieuxs
    sons Statutory Accident Benefits on an ongoing basis while the arbitration
    proceeded.

[8]

At the arbitration, the parties asked the arbitrator to determine a
    preliminary issue.  Although the parties put that issue before the arbitrator
    in an informal manner, I am satisfied that they agreed that Mr. Cadieux had
    been convicted of driving without insurance at the time of the accident
    contrary to s. 2(1) of the
Compulsory Automobile Insurance Act
, R.S.O.
    1990, c. C.25.
[1]
Intact and Federated asked the arbitrator to decide whether the abuse of
    process doctrine prevented Federated from leading evidence that Mr. Cadieux had
    insurance at the time of the accident.  Federated wanted to lead evidence that
    because Intact had not followed the required procedures when purporting to
    cancel the policy, Mr. Cadieux was insured at the time of the accident by
    Intact.  Intact maintained that Mr. Cadieuxs status as an insured or uninsured
    driver had been decided in the proceedings in which he was convicted of driving
    without insurance and that it would be an abuse of process to permit Federated
    to re-litigate that issue.

[9]

On the preliminary motion, Federated filed transcripts of examinations
    of two Intact employees.  It is unnecessary to refer to their evidence in
    detail.  It is sufficient to say that the evidence raised legitimate questions
    about Intacts notification to Mr. Cadieux of the policy cancellation.  Proper
    notice is a precondition to cancellation for non-payment.


III



the decisions below

[10]

In permitting Federated to lead evidence that Mr. Cadieux was insured at
    the time of the accident, the arbitrator emphasized that Federated had not been
    a party to the proceeding that had resulted in Mr. Cadieuxs conviction.  Consequently,
    Federated had no prior opportunity to raise the argument that Intact had not
    complied with the provisions governing policy cancellation.  The arbitrator
    concluded:

All of the jurisprudence brought to my attention by counsel
    herein involve situations where the individual who was convicted or a party
    with identical interests, sought to introduce evidence contrary to that
    supporting the initial conviction.  That is not the case here.  Here it is the
    opposing party Federated that seeks to introduce evidence contrary to the
    conviction at first instance.
Federated played no role whatsoever in the
    original proceeding and was not in a position to influence the outcome of the
    initial proceeding.  I am of the opinion that it would be unfair to deny a
    party of opposite interest an opportunity to lead evidence contrary to the
    initial conviction in the context of a priority dispute pursuant to the
    Insurance Act.
[Emphasis added.]

[11]

In reversing the arbitrator, the application judge held that the
    arbitrators decision that Federated could challenge the facts underlying Mr.
    Cadieuxs conviction raised a question of law reviewable on a correctness
    standard (paras. 22-24).  He also concluded that Federated had failed to lead
    any evidence to the contrary as required by s. 22.1 of the Ontario
Evidence
    Act
, R.S.O. 1990, c. E.23 (
Evidence Act
).  That section
    provides that proof of a prior conviction is proof that the crime was committed
    by the convicted person in the absence of evidence to the contrary.  The application
    judge said, at para. 39:

The onus to lead evidence to the contrary was clearly upon
    Federated.  In the record before the arbitrator, not only was there no
    credible evidence relating to the fathers conviction, there was no evidence
    to the contrary at all.  This is highlighted by the arbitrators own
    conclusions that it was Federateds intention to hopefully tender and
    introduce some unspecified, new evidence during the arbitration that could
    potentially amount to evidence to the contrary.

[12]

The application judge held that as Federated had not led any evidence
    to the contrary under s. 22.1, the arbitrator erred in law by refusing to
    apply the doctrine of abuse of process to prevent Federated from leading
    evidence that Mr. Cadieux had insurance at the time of the accident (paras.
    41-42).

[13]

The application judge briefly considered the abuse of process doctrine
    in more general terms.  After referring to
CUPE
, and noting that the
    consequences of a conviction for driving without insurance were sufficiently
    significant to warrant a serious defence to the charge (para. 45), the
    application judge returned to s. 22.1 of the
Evidence Act
.  He
    reasoned that because litigants who were not parties to the proceeding in which
    the conviction was entered could resort to s. 22.1 to prove the conviction in
    the subsequent proceeding, the arbitrator had erred in holding that Federateds
    non-involvement in the proceeding resulting in the conviction was a significant
    consideration in his decision to allow Federated to re-litigate Mr. Cadieuxs
    insurance status.  The application judge opined, at para. 46:

It is important to note that section 22.1 of the
Evidence
    Act
applies whether or not the father is a party to the arbitration.  In
    my view, the arbitrator focused upon whether Federated was a party to the
    criminal proceeding in deciding whether or not fairness dictated that Federated
    be provided with an opportunity to re-litigate the facts surrounding the
    conviction.  This was an error in law


IV



Analysis

(i)

Standard of review

[14]

For once, the applicable standard of review is not in issue.  Everyone
    agrees that correctness is the appropriate standard of review, both before the
    application judge and in this court:  see
CUPE
,
at paras. 13-16.

(ii)

The errors in law

[15]

In my view, the application judge confused the operation of s. 22.1 of
    the
Evidence Act

and
    the abuse of process doctrine.  That confusion led him into error.

[16]

Section 22.1 of the
Evidence Act
reads in part:

Proof that a person has been convicted  of a crime is proof,
    in the absence of evidence to the contrary, that the crime was committed by the
    person .

[17]

Section 22.1 is a rule of evidence intended to expedite the proof, in a
    subsequent proceeding, of facts decided in a prior criminal proceeding.  The
    section declares that evidence of one fact  a prior conviction  is proof of another
    fact  the convicted person committed the crime  absent evidence to the contrary.

[18]

Under s. 22.1, proof of the prior conviction constitutes proof of all
    of the facts essential to that conviction absent evidence to the contrary:
Caci
    v. Dorkin
, 2008 ONCA 750, 93 O.R. (3d) 701, at para. 15, leave to appeal
    refused, [2009] S.C.C.A. No. 2.  The section applies to convictions for
    provincial regulatory offences as well as convictions for criminal offences: 
    see
Andreadis v. Pinto
(2009), 98 O.R. (3d) 701, at paras. 11-16 (S.C.).

[19]

Evidence to the contrary under s. 22.1 refers to evidence that
    contradicts the facts essential to the prior conviction.  For example, evidence
    that a driver who had been convicted of driving without insurance was in fact insured
    at the relevant time would constitute evidence to the contrary under s. 22.1
    led to rebut the proof offered by evidence of the conviction.

[20]

Unlike s. 22.1, the abuse of process doctrine is not an evidentiary
    rule.  It is a common law doctrine developed by the courts to protect the
    integrity of the adjudicative process.  Abuse of process takes many forms.  This
    case is concerned with abuse of process by re-litigation of decided facts.  The
    doctrine precludes re-litigation when it would undermine the integrity of the adjudicative
    process.

[21]

The operation of s. 22.1 and the abuse of process doctrine intersect at the
    phrase evidence to the contrary in s. 22.1.  A party may lead evidence to
    the contrary to avoid the evidentiary rule established in s. 22.1.  The abuse
    of process doctrine operates to foreclose a party from leading that evidence
    to the contrary when to do so would constitute an abuse of the courts process: 
    see
Bank of Montreal v. Woldegabriel
, [2007] O.J. No. 1305, at paras.
    47-48 (S.C.).

[22]

The interaction between abuse of process and s. 22.1 is explained in
CUPE
,
at paras. 18-19:

s. 22.1 contemplates that the validity of a conviction may be
    challenged in a subsequent proceeding, but the section says nothing about the
    circumstances in which such challenge is or is not permissible.  That issue is
    determined by the application of such common law doctrines as
res judicata
,
    issue estoppel, collateral attack and abuse of process.  Section 22.1 speaks of
    the admissibility of the fact of the conviction as proof of the truth of its
    content, and speaks of its conclusive effect if unchallenged

Section 22.1 renders the proof of the conviction admissible. 
    The question is whether it can be rebutted by evidence to the contrary. 
    There are circumstances in which evidence will be admissible to rebut the
    presumption that the person convicted committed the crime, in particular where
    the conviction in issue is that of a non-party.  There are also circumstances
    in which no such evidence may be tendered.
If either issue estoppel or
    abuse of process bars the re-litigation of the facts essential to the
    conviction, then no evidence to the contrary may be tendered to displace the
    effect of the conviction.  In such a case, the conviction is conclusive that
    the person convicted committed the crime.

[Emphasis added.]

[23]

Applying the
CUPE

analysis
    to this case, the interplay between s. 22.1 of the
Evidence Act
and
    the abuse of process doctrine can be described in the following terms.  Intact,
    relying on s. 22.1, argued that proof that Mr. Cadieux had been convicted of
    driving without insurance at the time of the accident proved, for the purposes
    of the arbitration, that he was driving without insurance at that time, negating
    Intacts responsibility to pay Statutory Accident Benefits under the priority
    scheme in the
Insurance Act
.  Federated responded to Intacts position
    with evidence to the contrary consisting of evidence that Intact had not properly
    cancelled the policy, meaning that Mr. Cadieux was insured and that Intact was
    responsible for the Statutory Accident Benefits.  Intact, in turn, argued that the
    abuse of process doctrine should be applied to prevent Federated from leading
    its evidence to the contrary.

[24]

On the preliminary motion, the arbitrator had to decide if the abuse of
    process doctrine should block Federated from leading its evidence to the
    contrary.  The arbitrator was not asked to decide whether Federateds evidence
    would in fact negate the evidentiary value of the proof of Mr. Cadieuxs
    conviction for driving without insurance.

[25]

The application judge erroneously held, at paras. 41-42, that the
    preliminary motion turned on whether Federated had led sufficient evidence to
    the contrary to rebut the evidence offered by proof of Mr. Cadieuxs
    conviction for driving without insurance.  The outcome of the motion depended, not
    on whether Federated had led evidence to the contrary under s. 22.1, but on
    whether Federated had satisfied the arbitrator that in the circumstances it
    should be permitted to challenge the prior conviction with evidence to the
    contrary.  Federateds evidence that the Intact policy had not been properly
    cancelled was offered to demonstrate that if Federated was allowed to
    re-litigate Mr. Cadieuxs insurance status, it had evidence supporting its
    claim that Mr. Cadieux was insured.

[26]

The confusion between the evidentiary rule in s. 22.1 of the
Evidence
    Act
and the abuse of process doctrine reappeared when the application
    judge considered Federateds submission that it should be allowed to
    re-litigate the insurance coverage issue because it had not been a party to the
    proceedings in which Mr. Cadieux had been convicted of driving without
    insurance.  The application judge correctly pointed out that a litigant could
    use s. 22.1 to prove a prior conviction, even if that litigant was not a party to
    the proceedings in which the conviction was entered.  However, the application
    judge erred in law in concluding that the reach of s. 22.1 rendered Federateds
    non-involvement in Mr. Cadieuxs prosecution irrelevant for the purposes of the
    abuse of process doctrine.  That doctrine turns ultimately on whether fairness
    requires re-litigation.  The role played in the earlier proceeding by the party
    seeking to re-litigate a fact is an important consideration in deciding whether
    re-litigation constitutes an abuse of process.  Fairness is more likely to
    favour re-litigation if the party seeking to re-litigate did not have an
    opportunity to litigate the issue at the prior proceeding:
Canam
    Enterprises Inc. v. Coles

(2000),
    51 O.R. (3d) 481, at paras. 57-58, per Goudge J.A., dissenting, approved 2002
    SCC 63, [2002] 3 S.C.R. 307.  The evidentiary reach of s. 22.1 of the
Evidence
    Act
has no relevance to that fairness inquiry.

(iii)

Would re-litigation amount to an abuse of process?

[27]

The application judges legal errors are not necessarily determinative
    of the outcome of the appeal.  I must consider whether a proper application of
    the abuse of process doctrine precluded re-litigation of whether Mr. Cadieux
    was insured at the time of the accident.

[28]

The abuse of process doctrine as it is applied to prevent re-litigation
    is explained in
CUPE
.  I take the following points from the reasons of
    Arbour J.:

·

The
    abuse of process doctrine is a manifestation of a courts inherent power to
    prevent misuse of its process by re-litigation of previously decided facts:
CUPE
,
    at para. 37;

·

The
    doctrine is primarily focused on preserving the integrity of the administration
    of justice rather than protecting the interests of individual litigants:
CUPE
,
    at para. 43;

·

Re-litigation
    inevitably has a detrimental effect on the due administration of justice.  It
    can lead to inconsistent and even irreconcilable results, devalue finality, and
    cause the expenditure of resources, both public and private, on further proceedings
    with no guarantee that the second result will be more accurate than the first:
CUPE
, at paras. 38, 51-52;

·

Re-litigation
    should thus be avoided unless the circumstances dictate that re-litigation is
    in fact necessary to enhance the credibility and the effectiveness of the
    adjudicative process as a whole:
CUPE
, at para. 52;

·

There
    is no closed list of the circumstances in which re-litigation is necessary.  Courts
    will permit re-litigation if in the specific circumstances fairness dictates
    that the original result should not be binding in the new context:
CUPE
,
    at paras. 52-53.

[29]

The factors informing the fairness of permitting re-litigation in a
    given case will vary with the circumstances.
CUPE

identified some of those factors, at
    paras. 52-53.  Other cases have identified other factors:  see e.g.

Hanna v. Abbott
(2006), 82 O.R.
    (3d) 215, at para. 32 (C.A.);
Canam Enterprises Inc.
, at paras. 57-60;
    and
Becamon v. Wawanesa Mutual Insurance Company
, 2009 ONCA 113, 94
    O.R. (3d) 297, at paras. 17-21.

[30]

Most of the factors informing the inquiry involve a comparison of
    different features of the initial proceeding in which the finding of fact was
    made and the subsequent proceeding in which a party seeks to re-litigate that
    fact.  The court, in considering the various factors, must balance the damage
    done by re-litigation to systemic interests, including finality and consistency
    of result, against fairness to the litigant seeking to re-litigate a previously
    determined finding:
CUPE
, at paras. 15, 55.

[31]

I see no point in attempting to catalogue the factors relevant to the
    abuse of process inquiry.  Instead, I will address the factors that are
    relevant here.  There are four:

·

the
    parties to the two proceedings;

·

the
    nature of the initial proceeding (the prosecution);

·

the
    potential consequences or stakes of the initial proceeding; and

·

the
    nature of the second proceeding (the arbitration).

[32]

I start with a comparison of the parties to the two proceedings.  The
    Crown in Right of the Province of Ontario and Mr. Cadieux were the parties to
    the prosecution.  Neither Federated nor Intact were parties, or shared any
    interest in common with either the prosecutor or Mr. Cadieux.

[33]

As Intact was not a party to the prosecution, it cannot complain that
    re-litigation of Mr. Cadieuxs insurance status in the arbitration forces it to
    reprove a fact that it has already expended time and resources proving in another
    proceeding.  Intact is not being vexed to reprove a fact it has already proved:
CUPE
, at para 38.

[34]

Federated is a true stranger to the prosecution of Mr. Cadieux.  There
    is no suggestion that Federated was even aware of the prosecution.
CUPE
accepts that the abuse of process doctrine, unlike issue estoppel, can apply to
    preclude re-litigation by a party who was not a party to the prosecution.  However,
    the non-involvement of the party seeking to re-litigate in the initial
    litigation is a significant factor in determining whether re-litigation
    constitutes an abuse of process.  Clearly, a party who had a full opportunity
    to litigate a fact at a prior proceeding stands on much weaker ground when
    seeking to re-litigate that fact in a different context in a subsequent
    proceeding than does a party who has never had the opportunity to litigate the
    fact in issue:  see
CUPE
, at para. 19;
Canam Enterprises Inc.
,
    at paras. 57-58;
Caci
, at para. 15;
Engels v. Merit Insurance
    Brokers Inc. et al.
(2007), 84 O.R. (3d) 647 (S.C.); and
Morel v.
    Canada
, 2008 FCA 53, [2009] 1 F.C.R. 629.

[35]

The non-involvement of Federated and Intact in the proceedings in which
    Mr. Cadieux was convicted of driving without insurance militates in favour of
    permitting re-litigation of that issue as between Federated and Intact.  In
    particular, Federateds non-involvement in the prosecution was properly treated
    by the arbitrator as an important factor, strongly supporting Federateds contention
    that it should be allowed, in the context of the arbitration, to challenge Mr.
    Cadieuxs insurance status at the time of the accident.

[36]

I turn to the second factor.  The nature of the proceeding, in this case
    the prosecution of Mr. Cadieux for driving without insurance, in which the fact
    that a party seeks to re-litigate was first decided, can affect whether the abuse
    of process doctrine forecloses re-litigation.  The procedures followed in the
    first proceeding may have an impact, positive or negative, on the fairness of
    that proceeding or the reliability of its result:
Guergis v. Novak
,
    2013 ONCA 449, 116 O.R. (3d) 280, at para. 18.  Parties arguing for or against
    re-litigation in a subsequent proceeding may rely on those features of the
    prior proceeding to support their position.  For example, if the initial
    proceeding provided little, if any, procedural fairness to the parties, the
    nature of that proceeding would support arguments in favour of re-litigating
    facts decided in that proceeding:  see
Becamon
, at paras. 21-22.

[37]

Arguments directed at the nature of the initial proceeding can be made
    at a general and a specific level.  The former looks to the statutes and rules
    governing the conduct of the initial proceeding while the latter looks to the
    actual conduct of the specific proceeding in issue.  Arguments that the
    procedures provided for in the relevant rules are so informal as to render the
    outcome of the initial proceeding unfair, or unreliable, can be made without
    evidence.  However, if a party seeks to rely on the conduct of the specific
    prior proceeding, either to support or counter an abuse of process argument, it
    is incumbent on that party to lead evidence to support its position.  For
    example, if one party claims that the conviction entered in the prior
    proceeding should not foreclose re-litigation because the accused did not
    understand the charge, or did not defend the charge, it falls on that party to
    lead evidence to support its claim.  Equally, if a party seeking to invoke the
    abuse of process doctrine at the subsequent proceeding asserts that exactly the
    same factual issues were fully litigated at the prior proceeding, it falls on
    that party to lead evidence to support that position.

[38]

On the preliminary motion before the arbitrator, neither party led any
    evidence about the proceeding resulting in Mr. Cadieuxs conviction.  To the
    extent that the nature of that proceeding was relevant to the abuse of process
    argument, the arbitrator could only assume that Mr. Cadieux was properly
    convicted according to the applicable statutory provisions.

[39]

Mr. Cadieux was prosecuted under the provisions of the
Provincial
    Offences Act
, R.S.O. 1990, c. P.33.  It is safe to assume that the
    prosecution proceeded under Part III of that
Act
.
[2]
The procedures described in Part III of the
Provincial Offences Act
are
    similar to those used in the prosecution of summary conviction matters under
    the
Criminal Code
.  Like a criminal prosecution, Mr. Cadieuxs prosecution
    was carried out by a public prosecutor, acting in the public interest:
CUPE
,
    at para. 31.  Furthermore, as in a criminal proceeding, the prosecution was required
    to prove guilt beyond a reasonable doubt.

[40]

In the absence of any evidence referable to the specific proceedings
    against Mr. Cadieux, I see no reason to doubt the fairness of the proceeding or
    to discount the reliability of any factual findings essential to his
    conviction.  In my view, the nature of the prior proceeding speaks against permitting
    Federated to re-litigate Mr. Cadieuxs insurance status on the arbitration.

[41]

The third factor set out above focuses on the potential consequences of
    the proceedings to the parties.  As Arbour J. indicated in
CUPE
, at
    para. 53, if the stakes of the first proceeding are too minor to generate a
    full and robust response, fairness supports re-litigation of facts decided in
    the first proceeding, especially when the stakes in the second proceeding are
    considerably more significant:  see also
Becamon
, at para. 20.

[42]

As with arguments about the nature of the initial proceedings, arguments
    about the stakes of the first proceeding, both for and against the application
    of the abuse of process doctrine, can be made on a general or specific level.  If
    the statute calls for a minimal penalty, the argument can be made that a party
    would not spend the time or money needed to make a full and robust response
    to the charge.  However, if the potential penalties are significant, one can
    argue that those penalties would naturally generate a full and vigorous defence.

[43]

Apart from arguments based on the penalties provided by the applicable
    legislation, it can be argued that the outcome of the initial proceeding was
    particularly important, or unimportant, to the parties:  see e.g.
Duncan v.
    Morton
, 2013 ONSC 3105, [2012] I.L.R. I-5297, at paras. 27-28, leave to
    appeal to Divisional Court refused, 2012 ONSC 5200.  If that kind of argument
    is to be advanced, the party making the argument must lead evidence to support it. 
    No such evidence was led in this case.

[44]

A conviction for driving without insurance carries a minimum fine of
    $5,000 and a potential licence suspension.  I agree with the application judge
    that those consequences are sufficiently serious to assume that a person facing
    that charge would make a full and robust defence, if he had one.  The
    potential outcome of the initial proceeding does not favour allowing Federated
    to re-litigate the finding that Mr. Cadieux drove without insurance.

[45]

The fourth factor germane to the application of the abuse of process
    doctrine in this case looks to the nature of the proceeding in which the party
    seeks to re-litigate the previously-decided fact.  It is fair to say that re-litigation
    of decided facts in any context has some negative impact on the integrity of the
    administration of justice.  However, re-litigation of some facts in certain
    contexts can have a profoundly negative impact on the integrity of the overall
    administration of justice.  Re-litigation of other facts in other contexts will
    have only a minimal impact.

[46]

The facts in
CUPE
present an example of a situation in which
    re-litigation, in the context of a labour arbitration, of facts decided in a
    previous criminal case would have had a very damaging effect on the overall integrity
    of the adjudicative process.   A justice system that could in one proceeding brand
    an individual guilty of sexual assault and worthy of a lengthy jail sentence, and
    in another proceeding declare the same person to have not committed the offence
    and to be entitled to employment as a teacher, could not hope to maintain the
    support of an informed public for either result:  see
CUPE
, at paras.
    57-58.

[47]

The facts of this case are far removed from those of
CUPE
.
Federated seeks to re-litigate Mr.
    Cadieuxs status as an insured driver in the context of a private dispute
    between Federated and Intact over the obligation to pay Statutory Accident
    Benefits under a priority scheme designed to allocate the responsibility for
    those payments as among insurers.  While there is certainly a public interest
    in protecting the passengers right to Statutory Accident Benefits under the
Insurance
    Act
, there is little, if any, public interest in the determination of
    which of the two insurers involved in the proceeding should pay those benefits.

[48]

The arbitration proceeding is particularly well-suited to a
    determination of whether Mr. Cadieux was an insured driver at the relevant
    time.  Both Intact and Federated have the means and expertise to fully litigate
    the issue.  Both also have ready access to the information necessary to
    accurately determine whether the policy was properly cancelled.  In my view,
    determining Mr. Cadieuxs insurance status in the context of the arbitration
    between Intact and Federated is likely to enhance the credibility and the effectiveness
    of the adjudicative process as a whole:
CUPE
, at para. 52.

[49]

Realistically, I see no danger to the overall integrity of the adjudicative
    process flowing from a re-litigation of Mr. Cadieuxs insurance status in a
    private arbitration between Federated and Intact.  Even if that re-litigation were
    to produce a finding that is inconsistent with the finding underlying Mr.
    Cadieuxs conviction, that inconsistency would do little, if any, damage to the
    integrity of the process.  A balancing of systemic concerns that inevitably arise
    if re-litigation is permitted against fairness to the litigants, and in
    particular Federated, favours re-litigation in these circumstances.


V



conclusion

[50]

The preliminary motion before the arbitrator proceeded on the basis that
    Mr. Cadieux had been convicted of driving without insurance at the time of the
    accident.  Federated, as the party seeking to re-litigate Mr. Cadieuxs
    insurance status, had the onus of demonstrating that re-litigation would not,
    in the circumstances, amount to an abuse of process:
Bank of Montreal
,
    at para. 48; and
CUPE
, at para. 52.

[51]

In my view, fairness to Federated strongly dictates that it should have
    an opportunity to demonstrate that Mr. Cadieux was insured at the time of the
    accident.  Intact suffers no unfairness in allowing Federated that
    opportunity.  In addition, re-litigation of Mr. Cadieuxs insurance status in
    the context of the private arbitration between the insurers has no negative
    impact on the integrity of the overall adjudicative process and may in fact
    enhance that integrity by generating a more reliable result.  These factors
    combine to satisfy the onus on Federated to show that re-litigation would not
    constitute an abuse of process.

[52]

I would allow the appeal and restore the arbitrators order.  Federated
    should have its costs here and before the application judge.  In keeping with
    counsels comments at the end of oral argument, I would fix those costs at
    $15,000 for the appeal and an additional $7,000 for the hearing before the
    application judge, as agreed to by the parties, inclusive of disbursements and
    relevant taxes.  If I have misunderstood counsels comments, they should advise
    the court.

Released: DD  JAN 27 2017

Doherty J.A.

I agree J.C. MacPherson J.A.

I agree P. Lauwers J.A.





[1]

The parties did not file a Certificate of Conviction as
    contemplated by s. 22.1(3) of the Ontario
Evidence Act
, but instead filed a document referred to as an extended driver
    profile.  That document indicated that Mr. Cadieux was convicted of Operate
    Motor Vehicle No Insurance C.A.I.A.  Strictly speaking, the document does not
    appear to be evidence of anything.



[2]
Technically, it would appear that the prosecution could have proceeded under
    Part I of the
Provincial Offences Act
.  That part provides for a much
    less formal procedure, including convictions based entirely on an accuseds
    failure to defend the charge.  However, given the very significant minimum fine
    imposed for driving without insurance ($5,000), and the much lower maximum
    penalties available under Part I ($1,000), it is very unlikely that the
    prosecution would ever proceed with a charge of driving without insurance under
    Part I:  see
Provincial Offences Act
,
    s. 12.


