Neutral Citation: 2000 ONFSCDRS 38

FSCO A98-000318

BETWEEN:

SAM MATICHUK

Applicant

and

COMMERCIAL UNION ASSURANCE COMPANY

Insurer

Before: Deena Baltman

Heard: February 11, 2000, by teleconference.

Appearances:

Anthony J. Potestio for Mr. Matichuk

Aldo Picchetti for Commercial Union Assurance Company

Issues:

The Applicant, Sam Matichuk, was injured in an automobile accident on November 2, 1991. In a decision dated March 1 and 2, 1999, I dealt with his claims for various medical and rehabilitation benefits under the Schedule.¹ I dismissed Mr. Matichuk's claims on the basis that the accident did not contribute significantly to his need for the disputed benefits. I reserved on the issue of expenses.

Both parties now seek their expenses of the arbitration. They also dispute what amount should be paid in expenses.The issues, therefore, in this further hearing are:

Is either party entitled to its expenses incurred in respect of this arbitration proceeding?
If so, in what amount?

Result:

Mr. Matichuk is entitled to 75 percent of his legal fees and 100 percent of his assessable disbursements.
Mr. Matichuk is entitled to recover 40 hours for his counsel's preparation and attendance, at the rate of $110 per hour, along with Mr. Pontello's report of $1,100.

EVIDENCE AND ANALYSIS:

Entitlement to Expenses:

At the hearing, Mr. Matichuk sought payment for various medical devices and home fixtures as a result of his back injury. The main dispute was causation, as Mr. Matichuk had a long pre-accident history of back pain. I ultimately found that although many of the devices he sought were reasonable for someone in his medical condition, he failed to prove that the accident materially contributed to his need for them.

As Mr. Matichuk's Application for Arbitration was filed after November 1, 1996, the criteria for awarding expenses set out in Regulation 464/96 apply to these proceedings. They are:

Each party's degree of success in the outcome of the proceeding.
Conduct of the insurer or the insured person that tended to shorten or facilitate the proceeding or that tended to prolong, obstruct or hinder the proceeding, including failure to comply with undertakings or orders.
Whether the proceeding or any position taken by the insurer or the insured person during the proceeding was manifestly unfounded, frivolous, vexatious, fraudulent or an abuse of process.
The degree of complexity, novelty or significance of the factual or legal issues raised in the proceeding.
If the insurer or the insured person requests, any written offers to settle made after the conclusion of mediation and before the conclusion of the arbitration in accordance with the rules of practice and procedure applicable to the proceeding, including the terms of the offers, the timing of the offers and the responses to the offers, having regard to the result of the proceeding.
Any other matter related to the proceeding that the arbitrator considers relevant to the issue of whether an award of expenses is justified.

Commercial Union argued that it should be awarded its legal fees because this was a simple case of little or no merit that should not have been arbitrated.

Although Mr. Matichuk failed to prove causation, I find that his claim was brought in good faith. Some medical opinions supported his position that the accident was a significant contributor. He suffers from a genuinely painful back condition. Although some of the devices claimed were somewhat extravagant, others were reasonable for a man in his condition.

Considering all these factors, I find it appropriate to award Mr. Matichuk 75 percent of his legal fees and 100 percent of his assessable expenses.

Amount of Expenses:

The parties disagreed on three items: the number of hours for counsel's preparation and attendance, counsel's hourly rate, and the fee charged for Mr. Pontello's report.

A) Preparation and attendance

Mr. Potestio, who represented Mr. Matichuk at the hearing, inherited the file from Mr. Demeo, who originally represented Mr. Matichuk. Their combined accounts, after a reduction for any duplication in hours, total approximately 90 hours for preparation and attendance. This seems highly excessive. The accounts include fees for mediation and other matters that preceded the filing for arbitration, which previous cases have disallowed. Moreover, the arbitration required only one hearing day in Thunder Bay and a further half day by teleconference for submissions. Only two witnesses were called. The claim was restricted to medical expenses and the dispute was largely over causation. Although there was some medical controversy, the case was not complex. After accounting for all these factors, I find that 40 hours for preparation and attendance is adequate.

B) Hourly rate

Section 76.1 of the Dispute Resolution Practice Code allows an arbitrator to increase the hourly rate used to calculate the amount awarded for an applicant's legal fees to a maximum of $150 per hour, from a base rate of $83.75 per hour. Mr. Picchetti argues that counsel's hourly rate should not exceed $85. Although the issues in this case were not complex, both Mr. Potestio and Mr. Demeo have been in practice for over 15 years. The hearing was presented efficiently. I find that an hourly rate of $110 is reasonable.

C. Mr. Pontello's report

Mr. Pontello, an occupational therapist, charged $1,100 for his report. Mr. Picchetti argues that this is excessive because Mr. Pontello could not confirm that the expenses sought were necessary because of the accident. Nonetheless, the report demonstrated that some of the expenses were reasonable and necessary, an element I would have gone on to consider more fully had the Applicant succeeded on the issue of causation. I allow the full cost of the report.

February 17, 2000

Deena Baltman

Arbitrator

Date