LAT Tales: Bring the frivolous motion, pay the cost
In Syed v. Security National Insurance Company , the LAT dismissed the applicant’s application and awarded the respondent, Security National Insurance Company, $2,000.00 in costs.
Motions can be a useful tool at the LAT, but with finite resources frivolous motions constitute a hindrance. The awarding of costs at the LAT is rare, but there is a mechanism for costs to be awarded. I have summarized below how the costs award arose in this case.
The applicant, Sarah Syed, was involved in an accident on November 4, 2018. She was denied certain benefits by the respondent and applied to the LAT for resolution of the dispute.
Issues in Dispute
The issues in dispute included whether the applicant sustained a catastrophic impairment. The applicant had exhausted the non-CAT limit of $65,000. So, if she established that she is catastrophically impaired, then she could be entitled to the additional treatment and attendant care benefits claimed.
The applicant claims that she sustained a catastrophic impairment under criteria 7 and 8.
Criterion 7 requires the applicant to establish that she sustained physical impairments and a mental or behavioural impairment resulting in a 55% or more whole person impairment (“WPI”)
The applicant submitted that she suffered a catastrophic impairment under criterion 7, and the respondent disagreed. The adjudicator completed a thorough analysis of the issue and concluded that the claimant suffered a WPI of 42%. As such, the applicant did not sustain a catastrophic impairment within the meaning of criterion 7.
Criterion 8 requires the applicant to establish that she sustained a mental or behavioural disorder resulting in a class four impairment in 3 or more areas of function that precludes useful functioning, or a class five impairment (extreme impairment) in one or more areas of function that precludes useful functioning .
The adjudicator provided an analysis of the final domain – social functioning, and concluded that the applicant did not suffer from a class four impairment. As such, the applicant did not establish that she suffered from a catastrophic impairment in accordance with criterion 8.
Given that the applicant had exhausted the non-CAT limit of $65,000 for medical/ rehabilitation and attendant care benefits, no other analysis was required to be completed for the treatment plans in dispute. As the claimant was not successful on any of the issues in dispute, she was not awarded a special award.
The parties made several motions shortly before and during the hearing.
Two days prior to the hearing, the applicant brought a motion for productions seeking the complete accident benefit file as of December 31, 2022, including adjuster log notes, and asking for an adjournment. The respondent opposed the motion on the ground that the applicant did not file the Notice of Motion and supporting material at least 10 days in advance of the hearing. The motion was denied due to the applicant’s failure to comply with the notice requirement.
During the first week of the hearing, the applicant repeatedly moved for production of the same documents. These motions were denied, on the basis that it was too late to bring them.
During the examinations of many witnesses, the applicant moved for orders requiring witnesses to produce documents. The adjudicator denied all but one of those motions, on the basis that the applicant should have moved to obtain the evidence in advance of the hearing. The only exception was the applicant’s motion for the clinical notes and records of one of the medical experts, which were made an exhibit because the expert had the notes before him during his testimony.
For its part, the respondent brought a motion to exclude a witness from testifying (Modesta Sabaliauskiene), who was listed as a placeholder for a representative of CIRA Health Solutions that arranged the s.44 assessments for the respondent. The applicant was seeking to determine what functions were delegated to the independent assessors.
The respondent argued that Ms. Sabaliauskiene had no relevant or admissible evidence and the applicant could obtain the information sought from the adjuster and the assessors who were also called as witnesses.
As there was no prejudice to the applicant, the motion was granted, on the basis that s.15(1) of the Statutory Powers Procedure Act permits the tribunal to exclude unduly repetitious evidence.
The respondent also brought a motion to quash the summons for one of the accident benefits file adjusters. After the summons was issued, the respondent learned that the adjuster was on indefinite medical leave. The applicant argued that there was no evidence that the adjuster was actually on indefinite medical leave. The adjudicator held that it was sufficient to take the respondent’s counsel at his word, as an officer of the court. The motion was granted because another adjuster was being summoned to provide evidence on behalf of the insurer and because the log notes of the other adjuster were entered as an exhibit.
The applicant asserted on two occasions that the adjudicator recuse himself as he was biased. The adjudicator declined to recuse himself and noted that the decisions he made in denying the applicant’s motions were based on well-established principles and caselaw.
Midway through the hearing, the applicant brought a motion for the Tribunal to state a case to the Divisional Court pursuant to s. 13(1)(c) of the SPPA, on the basis that the respondent was acting in such a way that would be considered in contempt of the court.
The applicant alleged two instances of contempt, specifically that the respondent’s assessment clinic committed the criminal offence of forgery in its preparation of the independent assessment reports and the respondent breached s. 45(5) of the SABS by failing to provide copies of independent assessment reports to the applicant within 10 business days of receiving them.
The adjudicator dismissed the motion, on the basis that there were no grounds for stating a case for contempt to the Divisional Court. The allegations were found to be frivolous and vexatious.
At the end of the hearing, the applicant brought a motion seeking $2,000,000 in punitive damages on the grounds that the respondent breached its duty to act in good faith. The motion was denied as the LAT does not have the jurisdiction to award punitive damages.
Costs are not frequently awarded at the LAT, but there are situations where costs may be awarded to a party. Rule 19.1 of the Rules provides that costs may be awarded against a party that has acted unreasonably, frivolously, vexatiously, or in bad faith.
The respondent sought costs of $1,000.00 for each of the applicant’s motions seeking that the LAT state a case to the Divisional Court for contempt and seeking punitive damages.
Notably, in the motion for punitive damages, the applicant requested that the LAT issue a caution against respondent’s counsel for abusing the process of the LAT and breaching section 5.1-2 of the Rules of Professional Conduct, alleging that the respondent and its counsel engaged in serious misconduct, including criminal offences. The respondent submitted that the allegations of misconduct were baseless and inflammatory.
Rule 19.5 provides that the Tribunal must consider all relevant factors, including the seriousness of the misconduct, whether the conduct was in breach of a direction or order issued by the Tribunal, whether a party’s behaviour interfered with the Tribunal’s ability to carry out a fair, efficient, and effective process, prejudice to other parties, and the potential impact an order for costs would have on individuals accessing the Tribunal system.
The adjudicator provided an analysis of the facts surrounding the alleged misconduct which included all of the motions from the time of the case conference to the motion seeking punitive damages. The adjudicator found that the applicant’s allegations of wrongdoing by the respondent and its counsel were frivolous and vexatious and there was no merit to the accusations.
As the applicant’s motions were groundless and inflammatory, the adjudicator found that an award of costs was warranted. As requested by the respondent, $1,000.00 was awarded to the respondent for each of the two motions in issue. The adjudicator noted that bringing the motions was inappropriate conduct and should not be tolerated. The respondent was also prejudiced by being put to the needless expense of preparing response submissions.
While motions are a useful mechanism at the LAT, bringing a motion that is unreasonable, frivolous, vexatious, or in bad faith may result in costs being awarded against a party. Syed v Security National Insurance Company, 2023 CanLII 26958 (ON LAT)  The five classes of impairments are as follows:
Class 1: No Impairment
Class 2: Mild Impairment – Impairment levels are compatible with most useful functioning
Class 3: Moderate Impairment – Impairment levels are compatible with some, but not all, useful functioning
Class 4: Marked Impairment – Impairment levels significantly impede useful functioning
Class 5: Extreme Impairment – Impairment levels preclude useful functioning
The four areas of function include activities of daily living; social functioning; concentration, persistence, and pace; and adaptation – deterioration or decompensation in work or work-like settings.