60-day time limit for mediation elapsed: FSCO

A director’s delegate for the Financial Services Commission of Ontario (FSCO) has upheld an arbitrator’s conclusion that mediation was deemed to have failed because it did not occur within 60 days of the application being filed with FSCO.

In State Farm Mutual Automobile Insurance Company and Nicholas Leone, David Evans dismissed the insurer’s appeal and affirmed the arbitrator’s decision from February 10, 2012. In that ruling, FSCO arbitrator Jeffrey Rogers concluded mediation was deemed to have failed because it did not occur within 60 days of an application being filed, and parties could not extend the time limit on consent once 60 days had expired.

In his decision, Evans upheld the 60-day deemed failure, but stated the parties had the ability to extend the time for mediation, as has been the practice for many years.

Leone had applied for and received statutory accident benefits from State Farm after being injured in a motor vehicle accident in September 2009. Disputes arose, prompting Leone to submit an application for the appointment of a FSCO mediator.

Although FSCO’s receipt of the application was confirmed by letter on Oct. 8, 2010, no mediator had been appointed by Mar. 14, 2011. Leone then submitted an application for arbitration to FSCO.

“Mr. Leone submits that his application was filed when he delivered his completed application to FSCO in September 2010. State Farm submits that his application was not filed until the mediator was appointed 11 months later,” Evans writes.

“I agree with the arbitrator that Mr. Leone did not need to attach the report of mediator to his application for arbitration where mediation has failed by statutory definition, but no report of mediator is available,” he notes. “Mr. Leone should not be prevented from proceeding to arbitration where through no fault of his own, s. 280(8) [requirement to issue a report of mediator] has not been complied with.”