The Financial Services Commission of Ontario reports that an Ontario court has clarified the requirement for good faith negotiations in mediation.

The Sukhu application for judicial review was heard by the Divisional Court on Sept. 21, 2001 at Newmarket. It was dismissed with costs.

Sukhu applied to the court after an unsuccessful mediation session in a claim for statutory accident benefits which concluded with the mediator reporting that mediation “had not taken place.”

Rather than reporting that the mediation had “failed,” which would have permitted the applicant to initiate an arbitration application or court action, the mediator reported that the mediation “had not taken place,” precluding the applicant from taking any further steps to resolve the dispute.

The court stated that it was not unreasonable in the circumstances for the mediator to rule that mediation “did not take place”, because of the requirement that the parties participate in good faith in a mediation. The court stated that Sukhu showed bad faith by merely presenting a bottom line position through her solicitor. Also, the court found bad faith in her refusal to accept two offers by FSCO to expedite another application for mediation.

The court also found that Sukhu’s opinion that the mediator’s ruling was unreasonable did not afford any basis whatsoever to prohibit the mediator from acting as mediator in further attempts to mediate this claim.