New Tribunal? New Rules? Same Paralegals, Fighting the Good Fight

There could be new grounds upon which paralegals will battle upon in the Canadian legal system. With the Liberal party coming out of the last election with a majority government, it seems more likely than ever that recommendations in Justice Cunningham’s report will be followed and a new government administrative tribunal – addressing insurance disputes – will be formed.

Although accident benefits from personal injury cases are well within the scope of paralegals, the formation of this new tribunal will change the rules of the game with regards to accident benefits and the insurance dispute solution system (DRS).

Based on the “Automobile Insurance Transparency and Accountability Report” released on April 2014, the major parties in the recent Ontario provincial election all agreed that auto insurance was too high and that steps needed to be taken to this problem.

One of the main reviews and reports on the Ontario auto insurance DRS came from Justice Douglas Cunningham, in which he provided twenty-eight recommendations. The main recommendations are as follows:

  • Eliminate mandatory mediation in favour of settlement meetings with an arbitrator
  • Three arbitration streams: paper review, expedited in-person hearings & full in-person hearings
  • Penalties for not meeting specific timelines

There has been feedback from Cunningham’s report, particularly from the Financial Services Commission of Ontario (FSCO) arbitrators themselves. They believe that the dispute resolution process must be flexible, fair, have expertise and independence and outline the following issues with Cunningham’s report:

  • Decision-markers should be experts with full independence
  • Procedural rules should not be too rigid
  • Time lines must not be unrealistically short
  • Dispute resolution must be seen as a viable alternative to proceeding to court

Overall, these proposed changes provide a foundation upon which to build a new tribunal that will over see these accident benefits and would largely be participated by paralegals. With the clash of an old system and this potential new one, paralegals may have new, uncharted territory upon which to venture upon.

 

Jason E. Lau is a Paralegal student at Centennial College in Toronto studying professional communications with Omar Ha-Redeye.

McQueen v. Echelon General Insurance Company

McQueen v. Echelon General Insurance Company (2011) O.J. No. 4563 (Ont CA).

In McQueen, the Ontario Court of Appeal upheld a $25,000 award for mental distress to a plaintiff who was denied accidents benefits by her insurer.

 Background

The plaintiff, Janey McQueen sustained soft tissue injuries and psychological problems as a result of a January 31, 2004 motor vehicle collision.   Subsequent to the collision, the plaintiff applied for and was denied various accident benefits. 

In the course of denying the benefits the defendant, Echelon General Insurance Company ignored assessment reports favorable to the plaintiff (including one from its own expert), refused to pay for assessments recommended by its experts and failed to explain why some of the denied benefits were not reasonable or necessary.

 Superior Court of Justice

The plaintiff commenced an action for the denied benefits and for mental distress.  The plaintiff took the position that her psychological condition deteriorated as a result of the defendant’s conduct.

The court accepted the defendant’s position.  Harris J. found that one object of the insurance contract was to secure the plaintiff’s peace of mind and that it was within reasonable contemplation of the parties that a breach of the peace of mind promise would bring about mental distress.

Harris J. reiterated the Supreme Court’s holding in  Fidler v. Sun Life Assurance Co. Ltd., (2006) 2 S.C.R. 3[Fidler], stating that an insurer owes the duty at common law to act in good faith in all its dealings with the insured and has an added duty not to inflict unnecessary mental distress.

Harris J. awarded the plaintiff just under $20,000.00 in benefits and $25,000.00 for mental distress.

 Ontario Court of Appeal

The defendant appealed the decision.  It took the position that since the plaintiff was not a party to the insurance contract (her husband was the policyholder) she was   not entitled to claim damages for mental distress.  The defendant also attempted to distinguish McQueen from Fidler, arguing that Fidler pertained to a policy for long term disability benefits and not statutory accident benefits.

The appeal was denied.  The court upheld the mental distress award and concluded as follows:

 People purchase motor vehicle liability policies to protect themselves from financial and emotional stress and insecurity. An object of such contracts is to secure a psychological benefit that brought the prospect of mental distress upon breach within the reasonable contemplation of the parties at the time the contract was made (Fidler, at para. 56). As an insured person entitled to call on the policy, Ms. McQueen was entitled to that peace of mind and to damages when she suffered mental distress on breach.

Alexander Rozine is an Associate at D’Angela Fox Vanounou LLP, a plaintiff-side personal injury firm in Toronto.