Neutral Citation: 2000 ONFSCDRS 208
FSCO A99-001175
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
DALBIR SINGH DHAMI
Applicant
and
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
Insurer
REASONS FOR DECISION
Before:
Asfaw Seife
Heard:
September 16, 2000, at the Offices of the Financial Services Commission of Ontario in Toronto.
Appearances:
Pavan Kumar for Mr. Dhami
Robert S. Franklin for State Farm Mutual Automobile Insurance Company
Issues:
The Applicant, Dalbir Singh Dhami, was involved in a motor vehicle accident on June 17, 1999. He applied for weekly income replacement benefits (IRBs) from State Farm Mutual Automobile Insurance Company ("State Farm"), payable under the Schedule.1 State Farm refused to pay the benefits claimed. The parties were unable to resolve their disputes through mediation, and Mr. Dhami applied for arbitration at the Financial Services Commission of Ontario (the "Commission") under the Insurance Act, R.S.O. 1990, c.I.8, as amended.
The issues in this hearing are:
Is Mr. Dhami entitled to weekly income replacement benefits pursuant to section 4 of the Schedule? If so, what is the amount of the benefits?
Is Mr. Dhami entitled to a special award?
Is State Farm entitled to an award in the amount of its assessment fee of $3,000?
Is State Farm entitled to its arbitration expenses?
Result:
Mr. Dhami's Application for Arbitration is dismissed.
Mr. Dhami shall pay State Farm its filing fee of $3,000.
Mr. Dhami shall pay State Farm the expenses it incurred in respect of this arbitration, in the amount of $500.
Background:
In his Application for Arbitration, Mr. Dhami claimed that as a result of the accident of June 17, 1999, he suffered a substantial inability to perform the essential tasks of his pre-accident occupation as a truck driver. He sought entitlement to IRBs from one week after the accident and ongoing, at the rate of $400 per week, pursuant to section 4 of the Schedule. State Farm took the position that Mr. Dhami is not entitled to the benefits he claimed because he did not suffer the requisite disability. State Farm also claimed that it is not required to pay Mr. Dhami benefits under the Schedule because the accident occurred in the course of Mr. Dhami's employment and Mr. Dhami is entitled to receive benefits under a workers' compensation law or plan, pursuant to section 59 of the Schedule.
A pre-hearing discussion was held on March 1, 2000, at the offices of the Commission. Mr. Dhami attended, represented by Mr. Pavan Kumar, agent. Ms. Marrie Kirkwood attended on behalf of State Farm, represented by Mr. Jeremy Solomon, legal counsel. During the pre-hearing discussions, the issues in the arbitration were confirmed. The parties agreed on production undertakings and exchange of documents. The arbitration hearing was set for three days, commencing October 16, 2000, at the offices of the Commission. On March 7, 2000, the pre-hearing arbitrator sent a letter to the parties confirming the pre-hearing discussion. The Commission issued a formal Notice of Hearing to the parties on March 2, 2000, confirming the date, time and place of the hearing.
By letter dated October 4, 2000, Mr. Kumar advised State Farm and the Commission that:
... under unusually circumstances (sic) Mr. Dhami has refused to cooperate to provide production as required. We attempted since early part of year 2000; but have been unsuccessful to get any positive response. Therefore, I have no other choice but to remove my name from the record. Kindly correspond with Mr. Dhami directly.
It does not appear that a copy of this letter was sent to Mr. Dhami.
On Friday, October 13, 2000, at approximately 1:27 p.m., the case administrator at the Commission telephoned Mr. Kumar and spoke to him about his October 4, 2000 letter. The case administrator noted that Mr. Kumar told her that he had made numerous attempts to contact Mr. Dhami with no success, that he "has had no cooperation" from Mr. Dhami. Mr. Kumar advised that he was therefore withdrawing from the arbitration proceeding as Mr. Dhami's representative. The case administrator drew Mr. Kumar's attention to Rule 9.5 of the Dispute Resolution Practice Code — Third Edition (the Code), which states:
A representative who wishes to withdraw from an adjudicative proceeding shall notify the Commission and the parties, in writing. Where the party represented consents to the withdrawal, the Registrar shall permit the withdrawal. Otherwise, an adjudicator may permit the representative to withdraw subject to such terms as the adjudicator considers appropriate.
Since Mr. Kumar did not provide the Commission with Mr. Dhami's consent, the case administrator suggested that Mr. Kumar bring a motion before the hearing arbitrator if he wished to withdraw from the proceeding. Mr. Kumar then informed the case administrator that he (Mr. Kumar) will not be able to attend at the hearing in any event due to the fact that he (Mr. Kumar) had "just had surgery".
Shortly after her conversation with Mr. Kumar on Friday, October 13, the case administrator attempted to contact Mr. Dhami by telephone, unsuccessfully. She called Mr. Kumar's office again and left a message with his secretary that the arbitration hearing would be proceeding as previously scheduled since there has been no request for an adjournment.
At approximately 2:30 p.m. the same day, the Commission received a fax letter from Mr. Kumar consisting of the following paragraph:
In addition to my letter dated October 4, 2000, please be advised that I suffered an asthma attack and was discharge [sic] Hospital only on October 12, 2000. Therefore, in any event I will not be able to attend the Arbitration Hearing on October 16, 2000. I hope above will be satisfactory for your purposes.
It does not appear that a copy of this letter was sent to Mr. Dhami.
The hearing commenced at 10:00 a.m., on Monday, October 16, 2000, at the offices of the Commission, as scheduled. Mr. Mike Barneveld attended on behalf of State Farm, represented by Mr. Robert Franklin, legal counsel. Neither Mr. Dhami nor his representative were in attendance.
Rule 34.5 of the Code states:
Where notice of hearing has been sent to a party and a party does not attend at an oral or electronic hearing, or participate in a written hearing, the arbitrator may proceed with the hearing in the party's absence or without the party's participation, as the case may be, and the party is not entitled to any further notice of the proceeding.
The Notice of Hearing in this case was sent to the parties and their representatives on March 2, 2000. In addition to confirming the date, time and place of the hearing, the Notice of Hearing stated that the hearing will determine all issues in dispute between the parties and that the parties may attend the hearing in person and/or be represented. The Notice warned: "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 proceeding."
I was satisfied that the Notice of Hearing was sent to Mr. Dhami and that he was properly notified of the date, time, and place of the hearing, as well as the possible consequences of non-attendance. I therefore exercised my discretion to commence the arbitration hearing in the absence of Mr. Dhami or his representative.
At the outset of the proceeding, a man who had been sitting in the hearing room, requested to address me; and upon being given permission, he identified himself as Kamlesh Sengar, an agent in Mr. Kumar's office. He stated that he was sent by Mr. Kumar to inform me that Mr. Kumar was unable to attend due to sickness. Mr. Sengar emphasized that he was not representing Mr. Dhami, nor was he asked by Mr. Kumar to make any submissions or requests. He stated the sole purpose of his appearance was to bring Mr. Kumar's message that he was sick. Mr. Sengar provided no information as to why Mr. Dhami did not attend; however, he stated that he believed Mr. Dhami had withdrawn his application for arbitration. Mr. Sengar provided no documents or information beyond what is contained in Mr. Kumar's letter of October 13, 2000. The Commission did not hear from Mr. Dhami himself as to why he or his representative did not attend.
The Commission has received no adjournment request in this case. Even if I were to interpret Mr. Kumar's letter of October 13 as a request for an adjournment, I would not have been inclined to grant one. It is the practice of the Commission to adjourn a hearing if a party is prevented from attending due to a personal emergency, such as serious illness. However, I am not persuaded that Mr. Kumar was prevented from attending at the hearing due to a personal emergency. Mr. Kumar first informed the Commission on October 4, 2000 that he wished to withdraw from the proceeding as Mr. Dhami's agent because he was unable to get in touch with him and because Mr. Dhami did not comply with his production undertakings. It was only when Mr. Kumar was informed of the procedure under Role 9.5 of the Code that he indicated that he would be unable to attend at the hearing in any case because he was ill. If Mr. Kumar had been prevented from attending at the hearing because of sickness, he would have requested an adjournment and would have provided some independent confirmation of the reasons for his inability to attend, such as a medical note. I find Mr. Kumar failed to appear at the hearing because he no longer wished to represent Mr. Dhami in this proceeding.
Mr. Kumar did not request that I permit him to withdraw from the proceedings. However, I would not have granted his request because he did not comply with Rule 9.5 of the Code. Mr. Kumar has not obtained Mr. Dhami's consent to his withdrawal. He has not provided proof that he had notified Mr. Dhami, in writing, of his intention to withdraw. I received no evidence about any effort he has made to contact Mr. Dhami.
An arbitrator has the authority, under the Statutory Powers and Procedures Act, R.S.O. 1990, chap.5.22, as amended, to proceed with a hearing and consider the merits of a party's case in the party's absence where the arbitrator is satisfied that notice of hearing has been given to the party.
I am satisfied Mr. Dhami was effectively notified of the hearing. He was present at the pre-hearing when the date for the arbitration hearing was set. I decided to hear the merits of Mr. Dhami's claim in his absence.
Should Mr. Dhami's Application for Arbitration be Dismissed?
Mr. Franklin submitted that the burden of proof to substantiate the claim is on Mr. Dhami. He requested that I dismiss the Application because Mr. Dhami has presented no evidence to support his claim. Mr. Franklin also submitted that Mr. Dhami has commenced an arbitration proceeding that is vexatious, frivolous and an abuse of process and sought an order awarding State Farm its assessment fee of $3,000 and its arbitration expenses in the amount of $500.
I agree that the onus lies with the Applicant to prove entitlement to benefits. I heard no evidence regarding the nature of Mr. Dhami's injuries or why he continues to suffer a substantial inability to perform the essential tasks of his occupation. Mr. Dhami has failed to produce any medical or financial information to support his claim. He has called no witnesses. Therefore, in the absence of any evidence or submissions from Mr. Dhami, I am unable to find that he is entitled to IRBs. I conclude, therefore, that his claim must be dismissed.
Is State Farm entitled to an award of its assessment fee and arbitration expenses?
Section 282(11.2) of the Insurance Act gives an arbitrator discretion to order the insured person to pay to an insurer an amount that does not exceed the amount assessed against the insurer in respect of the arbitration, if he or she finds that the insured person commenced an arbitration that, in the opinion of the arbitrator, is frivolous, vexatious or an abuse of process.
Arbitration decisions which interprete the word "commences" in section 282(11.2) have stated that it does not restrict the focus of the inquiry to the commencement of the arbitration application, and that subsequent steps in the arbitration process could also be considered in deciding whether the applicant "commenced" an arbitration proceeding that is frivolous, vexatious or an abuse of process.2
Under subsection 282(11) of the Insurance Act, as amended in November 1996, I have the discretion to award expenses to an insurer or insured person, as prescribed in Ontario Regulation 664, as amended.3
It has been stated in a number of arbitration decisions that the dispute resolution scheme is designed to facilitate the applicant's access to relatively inexpensive, speedy and informal adjudication of disputes. The abuse of this process seriously undermines the effectiveness of the process, and must be discouraged.4
In this case, I find that an abuse of process has occurred. I find Mr. Dhami has used the arbitration process to advance a claim he was not prepared to pursue. He has produced no financial or medical documents to support his claim. He has failed to attend at the hearing and present his evidence, he has failed to comply with his obligation to produce documents requested by State Farm. It is Mr. Dhami's responsibility to communicate with his representative and to instruct him. As a result of Mr. Dhami's Application for Arbitration, State Farm was assessed a $3,000 filing fee. It retained legal counsel, who spent considerable time preparing and attending at the pre-hearing and the hearing, to defend the claim. I find Mr. Dhami has failed to pursue his claim with due diligence. I find State Farm is entitled to an award for the payment of its filing fee and its reasonable expenses, fixed at $500.
November 21, 2000
Asfaw Seife Arbitrator
Date
Neutral Citation: 2000 ONFSCDRS 208
FSCO A99-001175
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
DALBIR SINGH DHAMI
Applicant
and
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
Insurer
ARBITRATION ORDER
Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
Mr. Dhami's Application for Arbitration is dismissed.
Mr. Dhami shall pay State Farm its assessment fee of $3,000.
Mr. Dhami shall pay State Farm its arbitration expenses in the amount of $500.
November 21, 2000
Asfaw Seife Arbitrator
Date
Footnotes
- The Statutory Accident Benefits Schedule — Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended by Ontario Regulations 462/96, 505/96, 551/96 and 303/98.
- Cassman and Cassman and Wawanesa Mutual Insurance Company (OIC A96-000419, August 14, 1998), Gawronski and Allstate Insurance Company (OIC P98-00004, May 13, 1998).
- Ontario Regulation 664, as amended, sets out the criteria for the arbitrator's consideration. In particular, under subsection 12(2)2 an arbitrator may consider any conduct of a party that "...tended to prolong, obstruct or hinder the proceeding, including failure to comply with undertakings or orders," and under subsection 12(2)3 an arbitrator may consider whether the proceeding was "...manifestly unfounded, frivolous, vexatious, fraudulent or an abuse of process."
- See for example: Polus and Royal Insurance Company (OIC A-002392, August 18, 1995)