Law Times

Dec 10, 2012

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DUAL SPOUSES background checks Employers warned about privacy violations P4 FOCUS ON Unusual case a reminder to designate beneficiary P6 L AW TIMES Criminal Law W Discoveries Opposite Brampton Superior Court 1-905-915-0550 Co v e r i n g o n ta r i o ' s l e g a l s c e n e • w w w. l aw t i m e s n e w s . co m $4.00 • Vol. 23, No. 40 Untitled-2 1 ntitled-4 1 P9 245 languages December 10, 2012 PM 12-10-31 4:06 12-03-20 10:44 AM FSCO mediation ruling could cost $300M: lawyer Appeal court delivers blow to insurance industry over ADR timeline BY MARG. BRUINEMAN For Law Times A n Ontario Court of Appeal decision finding the Financial Services Commission failed to mediate a number of accident claims within a 60-day time limit could mean up to $300 million in costs that insurance companies will pass on through premiums, a lawyer estimates. "If you assume an average of $10,000 in legal fees to defend each of the cases that would have been settled at mediation using a 75-per-cent or even a 60-percent settlement rate, insurers are likely spending $300 million or more to fight cases that would have been settled at mediation if the mediators were to have been appointed in a timely fashion," says Eric Grossman, a partner at Zarek Taylor Grossman Hanrahan LLP who acted for State Farm Mutual Automobile Insurance Co. "This has huge, huge implications," says Ralph Palumbo, Ontario vice president of the Insurance Bureau of Canada. His organization was an intervener in Hurst v. Aviva Insurance Co. The decision means thousands of backlogged insurance claims may proceed to court or arbitration. "As Justice Juriansz points out, this clearly has an impact on insurance premiums for everybody," says Grossman. Hurst involved four cases combined under one appeal that asked the same question under the province's no-fault auto insurance system: when can insured people start court actions against their own insurers 'Both sides of the case believe that there should be timely mediation as dictated to by the timelines in the Insurance Act,' says Eric Grossman. Photo: Robin Kuniski to claim benefits under the statutory accident benefits schedule? The four claimants all suffered serious injuries in a crash. In each situation, they applied to FSCO for mediation after a dispute arose over statutory accident benefits. Under the schedule, mediation must precede court action or arbitration. FSCO failed to appoint a mediator within the 60day period during which, the claimants believed, mediation was to take place. They asked FSCO for a mediator's report indicating the 60 days had passed and the mandatory mediation had failed. But FSCO refused, replying that the clock didn't start ticking until it had assessed the application for mediation and found it to be complete, something that hadn't yet happened. The claimants sued their insurers over the disputed accident benefits. The insurers' motions to strike or stay the actions failed and they took the issue to the Court of Appeal to determine exactly when the clock for mediation starts and when the 60-day period has passed and the claimants can therefore pursue their claims in court. The insurers argued the statutory scheme for resolution would fall apart if court action could start before FSCO had a chance to initiate mediation. They pointed to FSCO's success rate in resolving 75 per cent of its cases through mediation. "No doubt, it is an important purpose of the legislative framework to make mediation mandatory. That, though, is not the whole story," wrote Justice Russell Juriansz on behalf of the three-member panel in the decision dated Nov. 29. See Thousands, page 5 Lawyer calls for gold standard rights system Law Times A A month after the government released Andrew Pinto's report, a fellow lawyer is criticizing it as a 'technician's approach' to the human rights system. month after the provincial government released a review of Ontario's human rights system, a City of Toronto lawyer is criticizing it as "a technician's approach" to improving the current framework. The review and recommendations in lawyer Andrew Pinto's report were restricted by guidelines that encouraged him to find faults and suggest fixes to the system instead of proposing an ideal new structure, Antonella Ceddia said during the Dec. 4 human rights summit hosted by the Law Society of Upper Canada. Last year, the province appointed Pinto, a human rights and employment lawyer, to review the effectiveness of the human rights system since the 2008 reforms to it. "I want to push the bar further than where the Pinto report is at right now," said Ceddia, who quickly pointed out that her opinions on the report don't reflect the views of the City of Toronto. She said Pinto's analysis fell within "a narrow set of terms." "Those terms did not ask Mr. Pinto to consider a gold standard system for enforcing human rights in Ontario," she wrote in a report she presented at the summit. "Instead, they asked Mr. Pinto to consider whether the reformed human rights system was quicker and more effective than the system it replaced." More than 200 pages of analysis accompanied Pinto's 32 recommendations to improve Ontario's human rights system. His suggestions include improving accessibility to complainant application forms, promoting active adjudication at tribunal hearings, and increased funding for the Human Rights Legal Support Centre. His review found that on average, it takes the Human Rights Tribunal of Ontario two years to receive a complaint and reach a decision. That's an improvement from 4.7 years under the previous system. "The current direct access system PM #40762529 BY YAMRI TADDESE See Few, page 5 A DAILY BLOG OF CANADIAN LEGAL NEWS [ WWW.CANADIANLAWYERMAG.COM/LEGALFEEDS ] LegalFeeds-BB-LT-Apr23-12.indd 1 POWERED BY CANADIAN LAWYER & LAW TIMES 12-11-23 9:59 AM

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