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Hurst v. Aviva: The Ontario Court of Appeal Decision that rocked FSCO Mediations & Accident Benefits in Ontario


November 29, 2012

Today Ontario's Court of Appeal released a landmark decision in Hurst v. Aviva. This decision has an impact on ANYBODY who has been hurt or injured in an accident in Ontario. It relates specifically to accident benefit law, which is a complicated, man made set of laws which gets tweaked every year by the provincial government.

This decision confirms that accident victims deserve timely access to justice when they have a dispute with their own auto insurer over statutory accident benefits.

So, what's this case all about and why's it so important? Keep reading and I'll fill you in!

If you get hurt or injured in a car accident, you have to apply for accident benefits from your own car insurance company. This is NOT the same thing as damages for pain and suffering. Lots of car accident victims gets confused, and us personal injury lawyers need to explain to them the difference between accident benefits and tort claims (pain and suffering claims). To boil it down, accident benefits claims generally come from your own car insurance company and cover such things as massage therapy, physiotherapy, occupational therapy, housekeeping benefits, and income replacement benefits. Damages for pain and suffering, and loss of income are part of the tort claim, and are paid for by the at fault driver's car insurance company.

So, if you've been really hurt in a bad car accident, and you need physiotherapy or massage to help you get back to health, your own car insurance company will have to pay for those things via the accident benefits regime,

When an insurance company denies your accident benefits (which sounds ludicrous, but happens more often than you would believe), then you have a accident benefits dispute with your own car insurance company. People retain personal injury lawyers to fight these disputes.

Under the Insurance Act and the Statutory Accident Benefits Schedule (SABS), accident victims CANNOT sue their own insurance company right away. Instead, the law requires that accident victims first apply for MEDIATION at the Financial Services Commission of Ontario (FSCO). If the mediation fails, then you may sue, or you may apply for Arbitration. But you CANNOT SUE right away. You first need to participate in a mediation at FSCO.

The law says that the mediation needs to be heard within 60 days from the date the Application for Mediation is filed. The problem is that FSCO is so backlogged, that it was taking well over 60 days for mediations to be heard. So, accident victims sometimes had to wait over 1 YEAR for their mediation to be heard, and in the meantime, they weren't getting any money for the physiotherapy, massage or chiropractic treatment they needed. Accident benefits were NOT getting paid out because of the significant delay in the system.

A personal injury lawyer said to hell with all of this wait time, I'm just going to sue after the 60 day time period has passed. It's not fair for my clients to wait on account of administrative delay. The lawyer then sued without the mediation having proceeded. They deemed it to have failed because it was not heard within 60 days as required under the law. The lawyer took this approach in a number of his cases against a variety of different insurance companies (Aviva, TD, State Farm, Meloche Monnex to name a few)

The accident benefit insurers mentioned above got together and brought a motion before the Court to have the actions stayed (frozen) or struck out of Court because the FSCO mediation had not taken place. The insurer's motions were denied. The insurers, because they care about YOU, and YOUR Rights/RECOVERY/ACCESS TO JUSTICE then pooled their money together and appealed to the highest Court in Ontario at the Court of Appeal. vicotry_dog_large.gif

The insurers lost at the Court of Appeal. This decision ensures for procedural fairness, access to justice, speediness and efficacy for accident victims across Ontario. It means that Ontario's accident victims will not be denied their day in Court on account of a procedural backlog which nobody in the insurance industry cares to address. It means that your rights will be protected instead of being at risk to wilt over time. It means that 60 days to have a mediation means 60 days and not 1 year!

One of my favourite quotes from the decision was that "the failure of a statutory actor to perform a statutory duty does not eliminate a person's right granted by the statute".

This Court decision is a landmark victory for Ontarians and for the personal injury bar. Chances are, you don't really care about this decision because it doesn't impact you. But, if you or a loved one has been hurt or injured in an accident, this decision will play a big impact on your case and quality of life. Last year, around 36,000 Applications for Mediation were filed at FSCO. As of April 1, 2012, 21,023 of 26,240 active applications that had not yet been referred to mediation were more than 60 days old! If you're going to make legal requirements for people to follow, then you need the infrastructure in place to accomodate those people. It's like calling an election with an electorate of 1,000,000 people, but only having 1 voting booth for people to cast their votes and that lone voting booth is only open for 1 day for 1 hour! It makes no sense.

Well, that's my law rant for the day. The decision is a solid read. How about Toronto's basketball team? What are those guys called again? They're just terrible. I don't want excuses about injuries or their difficult schedule. Results matter. I'm not seeing any results and I'm ashamed to be a Toronto fan.