FSCO has allowed an insurer’s appeal in a case over whether the claimant filed for arbitration too late.
In Pilot v. Tyler, the insurer denied the claimant’s claim for non-earner benefits. Section 281.1 of the Insurance Act provides a two-year limitation for a claimant to initiate proceedings over disputed benefits:
281.1 (1) A mediation proceeding or evaluation under section 280 or 280.1 or a court proceeding or arbitration under section 281 shall be commenced within two years after the insurer’s refusal to pay the benefit claimed.
There is an exception where the mandatory mediation is held near the two-year mark:
281.1 (2) Despite subsection (1), a proceeding or arbitration under clause 281(1) (a) or (b) may be commenced,
(b) if mediation fails . . . , within 90 days after the mediator reports to the parties under subsection 280(8).
The claimant applied for mediation in time. The mediation failed to resolve the issues and the mediator sent the parties his report. However, the claimant applied for arbitration more than 90 days after she received the mediator’s report (on appeal there was an issue as to whether the claimant should be allowed to introduce fresh evidence suggesting she hadn’t received the report at all when she applied for arbitration. The Director’s Delegate refused to allow her to file the fresh evidence).
At a preliminary issue hearing, the arbitrator held that the claimant’s arbitration was not barred because she initiated it within 90 days from the date her legal representative received the mediator’s report.
On appeal, the Director’s Delegate held that the arbitrator erred in finding that the 90-day limitation period under section 281.1 of the Act was not triggered until the claimant’s lawyer received the mediator’s report. The Director’s Delegate held that the plain wording of the section meant that the clock would start when the mediator reported to the “parties” (or their representatives):
I am persuaded that the clause 281(1.1)(b) limitation period runs, in the case of an insured person from the earlier of the date the Report of Mediator is received (or where it is appropriate, is deemed to have been received) by the insured or, where represented, by his or her representative.
However, as the arbitrator did not make any findings of fact regarding delivery of the Report of Mediator, the matter was remitted back to him to decide the issue.
Moral of the story: Don’t assume that the later date is still within a limitation period.