Onus is not on an insurer to prove the lack of a settlement agreement: FSCO

The Financial Services Commission of Ontario (FSCO) has reversed an arbitration decision that placed the onus on an insurer to prove that a disputed settlement offer of $17,000 had not been agreed upon.
In Allstate Insurance Company of Canada and Edna Klimitz, FSCO director delegate David Evans found the onus to prove the existence of an agreed settlement amount was on the party asserting the settlement.
And the “best objective indication of the existence or otherwise of an agreement was reflected in the actions of the parties afterwards,” Evans wrote, citing Mouriopoulos and The Citadel General Insurance Company.
Klimitz was injured in a motor vehicle accident on Nov. 7, 2003. After she was initially denied coverage, Klimitz asserted there was a valid offer made to settle the issues at a 2007 pre-hearing before an arbitrator. 
The mediator’s report of failed mediation on Mar. 5, 2007 indicated the last offer to settle the question of Klimitz’s non-earner benefits was ‘0.’
“Presumably, the Report of the Mediator can…provide evidence as well of the last offer, without necessarily being binding,” Evans wrote. “In this case, of course, the Report of the Mediator provided evidence that the last offer was zero.”
In Allstate and Klimitz, the original arbitrator’s findings of fact said the insurance adjuster made an original settlement offer of $17,500. Counsel for Klimitz wanted to “split the difference” between the insurer’s offer and Klimitz’s counter-offer of $21,000.
The adjuster said no to the counter-offer. Klimitz’s counsel then said he would accept the original offer of $17,500.
Evans noted that Allstate’s “original offer [of $17,500] could not be revived by tendering an acceptance of it after that rejection [of the offer to ‘split the difference’].”
What clinched the matter for Evans is that the value of the settlement offer had never been determined. The initial arbitrator said “the discrepancy [of settlement values] under the circumstances [was] not significant enough to conclude on that basis that there was no meeting of the minds.”
Evans found the opposite. “There was no evidence of a meeting of the minds, and in fact the arbitrator recognized that there was a discrepancy in the figures, so her order cannot stand.”