Neutral Citation: 1999 ONFSCDRS 194

FSCO A98-001131

BETWEEN:

ELSA NORBERTO

Applicant

and

GENERAL ACCIDENT ASSURANCE CO. OF CANADA

Insurer

REASONS FOR DECISION

Before:

Anne L. Sone

Heard:

June 21, 1999, at the Offices of the Financial Services Commission of Ontario in Toronto.

Appearances:

No one appeared for Ms. Norberto

Alan L. Rachlin for General Accident Assurance Co. of Canada

The Applicant, Elsa Norberto, was injured in a motor vehicle accident on September 20, 1993. She applied for and received statutory accident benefits from General Accident Assurance Company of Canada ("General Accident"), payable under the Schedule.¹ General Accident terminated weekly income benefits on September 4, 1997. The parties were unable to resolve their disputes through mediation, and Ms. Norberto applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The issues in this hearing are:

Is Ms. Norberto entitled to receive weekly income benefits pursuant to section 12 of the Schedule from September 5, 1997 and ongoing, on the basis that her injury continuously prevents her from engaging in any occupation or employment for which she is reasonably suited by education, training or experience?
Is General Accident liable to pay Ms. Norberto's expenses in respect of the arbitration under section 282(11) of the Insurance Act, R.S.O. 1990, c. I.8?
Is Ms. Norberto liable to pay General Accident's expenses in respect of the arbitration under section 282(11) of the Insurance Act, R.S.O. 1990, c.I.8?
Is Ms. Norberto entitled to interest on any amounts owing?

Ms. Norberto is not entitled to weekly income replacement benefits.
Ms. Norberto is not entitled to her expenses incurred in this arbitration proceeding.
Ms. Norberto is ordered to pay General Accident $1,636.95 in respect of its expenses.

1. History of Proceedings:

Ms. Norberto was injured in a pedestrian motor vehicle accident on September 20, 1993. She was struck by a station wagon and alleges that the driver was edging around a right turn, and looking to his left for oncoming traffic. He did not see her as she entered a crosswalk. She alleges that the insured vehicle bumped into her, causing her to fall to the ground in front of it, and that the vehicle then ran over her pelvis.

As a result of this accident, Ms. Norberto sustained some cuts which required stitching at the hospital. Otherwise, she principally had soft tissue injuries. Her physical complaints included headaches, heat and tingling sensations in one of her legs, along with numbness in both lower legs. She also had pain in her neck, shoulders, back, hips, feet and thighs. She has gone on to develop what appears to be substantial psychiatric problems.

General Accident paid a weekly income replacement benefit to Ms. Norberto up to September 4, 1997. It maintains that her injuries do not continuously prevent her from engaging in any occupation or employment for which she is reasonably suited by education, training or experience.

Ms. Norberto applied for mediation of her dispute with General Accident. According to the Report of Mediator dated February 6, 1998, the following issues remained in dispute: entitlement to weekly income replacement benefits of $443.48 from September 5, 1997 and ongoing; entitlement to housekeeping assistance, physiotherapy and prescription expenses; and interest on all outstanding payments. Ms. Norberto then applied for arbitration of the dispute.

On December 17, 1998, a pre-hearing discussion was held at the Commission. Ms. Norberto was notified of the pre-hearing discussion, but did not attend. She was represented by Ms. Michelle Gill. Mr. Donald Igbokwe attended on behalf of General Accident, represented by Mr. Alan Rachlin. The pre-hearing letter dated December 17, 1998 confirmed the issues in dispute, the production requirements and the dates of the arbitration hearing.

At the pre-hearing, Ms. Gill advised that her firm had lost touch with her client. She undertook to advise if Ms. Norberto could be located within 30 days. By letter dated February 2, 1999, she advised that her firm had not yet been able to contact Ms. Norberto. The firm continued to look for her and undertook to advise of any change of her address.

On January 11, 1999, a Notice of Hearing was sent to Ms. Norberto informing her that an arbitration hearing would take place on June 21, 22, 23 and 24, 1999 at the Commission. The Notice of Hearing included the following paragraph, which reflects the provisions of subsection 7(1) of the Statutory Powers Procedure Act, ("SPPA")² and section 34.5 of the Dispute Resolution Practice Code (The "Code"):

You may attend this hearing in person and/or be represented. If you or your representative do not attend at the hearing, the arbitrator may dispose of the case in your absence and you will not be entitled to any further notice of the arbitration proceedings.

By letter dated February 23, 1999, Mr. Rachlin requested a further pre-hearing in order to deal with production issues, and the issue of whether the arbitration should proceed, given that Ms. Norberto still could not be located. A pre-hearing resumption was scheduled for May 7, 1999. On May 6, 1999, Linda Wolanski of Thomson Rogers (the law firm representing Ms. Norberto) sent a facsimile transmission to the Commission stating that Ms. Norberto had recently left a voice mail message that she has been staying with friends. Despite its best efforts, Thomson Rogers has not been able to establish any direct contact with Ms. Norberto. Accordingly, Thomson Rogers placed the Commission on notice that it intended to file written materials in support of its request that it be permitted to withdraw as Ms. Norberto's legal representative.

At a resumption of the pre-hearing held by teleconference on May 7, 1999, the pre-hearing arbitrator allowed Ms. Wolanski to withdraw as Ms. Norberto's representative, pursuant to Rule 9.5 of the Code, on the condition that she advise Ms. Norberto of her withdrawal as counsel, provide the notice of the hearing date, and advice of the possible effects should Ms. Norberto not attend at the hearing. The arbitrator ordered that Ms. Wolanski could so advise Ms. Norberto by writing to her at her old address, and by leaving a message on her pager number. He also ordered Ms. Wolanski to provide Mr. Rachlin with that pager number. Mr. Rachlin advised that if Ms. Norberto was located before or at the hearing, he would be seeking an adjournment if productions were still pending.

The arbitration began as scheduled on June 21, 1999. The hearing was delayed for one-half hour to wait for Ms. Norberto to appear. Ms. Norberto did not appear and no one appeared on her behalf. Mr. Rachlin appeared on behalf of General Accident and sought an order dismissing the arbitration and awarding the Insurer its expenses.

According to settled case-law,³ I have no authority to make an arbitration order dismissing Ms. Norberto's claim solely on the basis that she did not attend the hearing. However, I am satisfied that every effort has been made to give proper notice of the hearing to Ms. Norberto in accordance with the SPPA and the Code. Additionally, the Commission sent Ms. Norberto two pre-hearing letters, and Thomson Rogers made diligent efforts to contact her.

Ms. Norberto did not contact the Commission or appear at the hearing. There was no evidence that she had not received the Notice of Hearing or the pre-hearing letters. In accordance with subsection 7(1) of the SPPA and section 34.5 of the Code, I proceeded with the hearing.

2. Ms. Norberto's entitlement to the benefits claimed:

The onus is on Ms. Norberto to prove her claim for benefits. As Ms. Norberto did not appear at the hearing, no evidence was led to support her position that she is entitled to any benefits. My findings in respect of her entitlement to the benefits she is claiming, is based on the evidence provided by General Accident.

Prior to the accident, Ms. Norberto was a clerical employee in the financial services industry. General Accident received some limited pre-accident records from Ms. Norberto's family physician, Dr. A. Studniberg. Although difficult to read, they call into question Ms. Norberto's pre-accident mental state. General Accident requested further productions, but they were never received.

General Accident states that Ms. Norberto had a tremendous amount of psychological counselling with Dr. D. Day following the accident. In addition, General Accident acknowledged that early on, Dr. A. Kachooie, a physiatrist, diagnosed Ms. Norberto as suffering from fibromyalgia. However, I have not seen any report from him.

Dr. M. H. Ford, an orthopaedic surgeon, assessed Ms. Norberto in February of 1995. In his report of February 7, 1995, he states:

From a strictly orthopaedic point of view, I feel that she has completely recovered from the musculoskeletal injuries that she incurred at the time of her original accident. I have some difficulty linking her "fibromyalgia" with her original traumatic event.

Dr. R. G. Wood, a psychologist, assessed Ms. Norberto in July of 1996. He took a very thorough history from Ms. Norberto. This history makes it clear that she had a very difficult family situation while growing up. More recently, she has had a turbulent relationship with her boyfriend. He concludes at page 22 of his July 4, 1996 report, that she appears to be invested in a regressed, dependant position.

Dr. A. Ameis assessed Ms. Norberto. His report of July 18, 1996 states:

In my opinion, Ms. Norberto does not suffer from any physical impairment or consequent disability. I would include in this opinion a lack of evidence for disability in domestic, recreational or work activity.

Dr. P. Bernstein, a psychologist, assessed Ms. Norberto and provided a report dated December 1996. In an addendum to that report, dated August 18, 1997, he states that Ms. Norberto did not suffer from a significant psychological impairment that would continuously prevent her from engaging in any employment for which she is reasonably suited by training, education or experience, or for that matter from returning to her pre-accident clerical employment. In his opinion, her reluctance to cross the street unaccompanied may be construed as the sole limitation with respect to the essential tasks of her day-to-day living.

There were no documents filed at the hearing to refute General Accident's position or support Ms. Norberto's claim. Had Ms. Norberto provided appropriate evidence of her claim, she may have been able to prove it. However, given the lack of evidence from Ms. Norberto or the doctors who allegedly support her claim, I accept the uncontested evidence of the doctors whose reports General Accident has provided. In the absence of evidence from Ms. Norberto to refute General Accident's evidence, I find that Ms. Norberto is not entitled to income replacement benefits for the period beyond September 4, 1997.

EXPENSES:

In her application for arbitration, Ms. Norberto seeks an award of the expenses in respect of this hearing. As held in previous cases,⁴ I find the Applicant's failure to pursue her claims has caused the Insurer to expend needless time and resources on this arbitration process. I therefore decline to exercise my discretion to award Ms. Norberto her expenses of the proceeding.

General Accident asked for payment of its expenses. It pointed out that it has come to this arbitration with clean hands, and has been put to unnecessary expense in connection with this hearing.

Subsection 282(11) of the Act was amended effective November 1, 1996 to allow an arbitrator to award expenses to either the insured person or the insurer. Regulation 664, as amended,⁵ applies in this case, as it came into effect prior to the filing of Ms. Norberto's application for arbitration. As Arbitrator Miller pointed out in Athanasiadis and Zurich Insurance Company,⁶ this amendment has broadened the scope of an arbitrator's discretion; however, that discretion must be exercised in accordance with the criteria set out in Regulation 664. These criteria have been incorporated into section 73 of the Code. In awarding expenses in this case, I am taking into consideration Ms. Norberto's conduct which tended to obstruct or hinder the proceeding, including failure to comply with undertakings or orders.

General Accident presented an itemization of its expenses which I am prepared to award. It claimed 15.8 hours of senior counsel time at the legal aid rate, (including the appropriate experiential increase) of $83.25 per hour and 4.8 hours of junior counsel time at the appropriate legal aid rate of $67 per hour, which comes to a total of $1,636.95.

General Accident is also claiming the expenses of its filing fee in the amount of $3,000. Prior to the amendment of the Act to allow an arbitrator the discretion to award expenses in favour of an insurer, subsection 282(11.2) of the Act allowed relief up to the amount assessed against the insurer in certain cases. Subsection 282(11.2) of the Act provides:

If an insured person commences an arbitration that, in the opinion of the arbitrator, is frivolous, vexatious or an abuse of process, the arbitrator may award an amount to be paid by the insured person to the insurer that does not exceed the amount assessed against the insurer in respect of the arbitration...

I concur with Arbitrator McMahon's statement in Richard and Lombard General Insurance Company of Canada,⁷ that the insurer is only entitled to relief under this section if it is called upon to respond to, and pay a filing fee in respect of, cases that are so devoid of merit as to be frivolous, or were launched to vex the insurer, or are in and of themselves, an abuse of the process. The insertion of the word "commences" focuses the inquiry on the state of affairs as they existed at the time the action was launched, and not on later procedural steps. I am not at all convinced that this case meets this criteria. At the very least, Ms. Norberto's claims would appear to be arguable at the time that the arbitration was commenced. Accordingly, I am not prepared to order the Applicant to pay the Insurer's filing fee.

October 5, 1999

Anne L. Sone Arbitrator

Date

Neutral Citation: 1999 ONFSCDRS 194

FSCO A98-001131

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

ELSA NORBERTO

Applicant

and

GENERAL ACCIDENT ASSURANCE COMPANY OF CANADA

Insurer

ARBITRATION ORDER

Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:

Ms. Norberto is not entitled to weekly income replacement benefits.
Ms. Norberto is not entitled to her expenses incurred in this arbitration proceeding.
Ms. Norberto is ordered to pay General Accident $1,636.95 in respect of its expenses.