In Ontario (Finance) v. Echelon General Insurance Company, 2019 ONCA 629, the Ontario Court of Appeal held that, even when applying a standard of reasonableness, there are occasions in which there is only a single reasonable answer. The Court also considered the role of accumulated decisions issuing by arbitrators under a statutory process in which the decisions are either published or not confidential and whether those decisions bound other parties in later arbitrations.
The dispute involved an appeal to the Superior Court from the decision of an arbitrator’s August 29, 2017 decision (“Decision”) which issued under the Disputes Between Insurers, O Reg 283/95 (“Regulation”) enacted under the Insurance Act, RSO 1990, c I.8. The arbitrator in the Decision determined that the Motor Vehicle Accident Claims Fund (“Fund”) was entitled to reverse its earlier acceptance as priority insurer and that Echelon General Insurance Company (“Echelon”) was required to cover accident benefits claimed as a result of an accident involving a snowmobile passenger.
See the decision in first instance by Thomas R. Lederer in Ontario (Minister of Finance) v. Echelon General Insurance Company, 2018 ONSC 4550. The Court of Appeal summarized the Decision at para. 8 and Lederer J.’s decision at para. 9.
An issue on appeal was the standard of review. The Court of Appeal at para. 10 held that “several decisions of this court have concluded that the standard of review for a question of law determined by an arbitrator in the statutory accident benefits regime is presumptively reasonableness”. The Court provided references in regard to its statement. See The Dominion of Canada General Insurance Company v. Unifund Assurance Company, 2018 ONCA 303 para. 35, leave to appeal refused, [2018] S.C.C.A. No. 199; Intact Insurance Company v. Allstate Insurance Company of Canada, 2016 ONCA 609 para. 53; and The Dominion of Canada General Insurance Company v. State Farm Mutual Automobile Insurance Company, 2018 ONCA 101 para. 44.
Having made that observation, the Court also cautioned that “there are occasions on which there is only one reasonable answer to a question of law” and referred to McLean v. British Columbia (Securities Commission), 2013 SCC 67 (CanLII), [2013] 3 SCR 895, para. 38.
“[38] It will not always be the case that a particular provision permits multiple reasonable interpretations. Where the ordinary tools of statutory interpretation lead to a single reasonable interpretation and the administrative decision maker adopts a different interpretation, its interpretation will necessarily be unreasonable — no degree of deference can justify its acceptance; see, e.g., Dunsmuir, at para. 75; Mowat, at para. 34. In those cases, the “range of reasonable outcomes” (Canada (Citizenship and Immigration) v. Khosa, 2009 SCC 12 (CanLII), [2009] 1 S.C.R. 339, at para. 4) will necessarily be limited to a single reasonable interpretation — and the administrative decision maker must adopt it.”
In McLean v. British Columbia (Securities Commission), the Supreme Court spoke to situations in which statutory language may be “less than crystal clear”. Borrowing the phrasing by Prof. J. Willis from “Statute Interpretation in a Nutshell” (1938), 16 Can. Bar Rev. 1, pp 4-5, the Supreme Court stated that two (2) interpretations can be reasonable when “words are ambiguous enough to induce two people to spend good money in backing two opposing views as to their meaning”. See Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 42 (CanLII), [2002] 2 SCR 559 paras 29-30 for the Supreme Court’s discussion of when an ambiguity exists in law.
“[29] What, then, in law is an ambiguity? To answer, an ambiguity must be “real” (Marcotte, supra, at p. 115). The words of the provision must be “reasonably capable of more than one meaning” (Westminster Bank Ltd. v. Zang, [1966] A.C. 182 (H.L.), at p. 222, per Lord Reid). By necessity, however, one must consider the “entire context” of a provision before one can determine if it is reasonably capable of multiple interpretations. In this regard, Major J.’s statement in CanadianOxy Chemicals Ltd. v. Canada (Attorney General), 1999 CanLII 680 (SCC), [1999] 1 S.C.R. 743, at para. 14, is apposite: “It is only when genuine ambiguity arises between two or more plausible readings, each equally in accordance with the intentions of the statute, that the courts need to resort to external interpretive aids” (emphasis added), to which I would add, “including other principles of interpretation”.
[30] For this reason, ambiguity cannot reside in the mere fact that several courts — or, for that matter, several doctrinal writers — have come to differing conclusions on the interpretation of a given provision. Just as it would be improper for one to engage in a preliminary tallying of the number of decisions supporting competing interpretations and then apply that which receives the “higher score”, it is not appropriate to take as one’s starting point the premise that differing interpretations reveal an ambiguity. It is necessary, in every case, for the court charged with interpreting a provision to undertake the contextual and purposive approach set out by Driedger, and thereafter to determine if “the words are ambiguous enough to induce two people to spend good money in backing two opposing views as to their meaning” (Willis, supra, at pp. 4-5).”
urbitral note – First, the Supreme Court in Bell ExpressVu Limited Partnership v. Rex has held that earlier decision makers having earlier come to differing conclusions on interpreting a provision do not, in and of themselves, create ambiguity. The ambiguity must be “genuine”.
Second, the Court of Appeal also referred to the arbitral precedents in establishing a single reasonable interpretation. The Court of Appeal’s reasons at paras 34-42 in the present case include a discussion of the role played by earlier statutory arbitral decisions. Echelon argued that arbitral decision limited the discretion of arbitrators to permit insurers to back away from an earlier acceptance of priority.
Combined, the cases caution that, even when presented with competing interpretations, there may actually be only a single interpretation against which the statutory arbitral decision will be measured as being reasonable or not.
The decision reflects how statutory arbitral decisions, when published or not confidential, serve to create a body of ‘case law’ or ‘jurisprudence’ against which later arbitral decisions can be measured. Such a role is unavailable when the underlying disputes and resulting awards in private commercial arbitrations remain confidential and not subject to appeal. The legislative intent to deny confidentiality is policy and not a decision on whether the resulting awards need qualify or serve as precedents.