Neutral Citation: 2001 ONFSCDRS 86
FSCO A99-000078
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
KENNETH MULLEN
Applicant
and
DOMINION OF CANADA GENERAL INSURANCE COMPANY
Insurer
DECISION ON EXPENSES
Before:
Judith Killoran
Heard:
May 23, 2001, at the Offices of the Financial Services Commission of Ontario in Toronto.
Appearances:
Mr. Mullen did not appear and no one appeared on his behalf.
Mr. William A. McClelland for Dominion of Canada General Insurance Company
Issues:
The Applicant, Kenneth Mullen, was injured in a motor vehicle accident on January 1, 1997. In a decision dated May 24, 2000, I dealt with his claims for statutory accident benefits under the Schedule.1 I made the following orders:
Mr. Mullen is not entitled to receive a weekly income replacement benefit pursuant to section 4 of the Schedule.
Mr. Mullen is not entitled to a special award pursuant to subsection 282(10) of the Insurance Act.
Dominion is not obliged to pay Mr. Mullen's expenses in respect of the arbitration under subsection 282(11) of the Insurance Act.
Mr. Mullen must pay Dominion's expenses in respect of the arbitration under subsection 282(11) of the Insurance Act.
The issue in this further hearing is:
- What is the amount of expenses to which Dominion is entitled in respect of this arbitration hearing?
Result:
- Mr. Mullen must pay to Dominion $2,155.05 plus applicable GST for expenses.
Background:
In my decision dated May 24, 2000, I found that Mr. Mullen's conduct had prolonged the proceeding. By refusing to comply with undertakings about productions and failing to appear at the arbitration hearing, Mr. Mullen caused unnecessary expense and delay. I declined to award Mr. Mullen his expenses and ruled that Dominion was entitled to its expenses of the arbitration hearing.
In compliance with Rule 77 of the Dispute Resolution Practice Code (Third Edition), Dominion provided Mr. Mullen with its account, including dockets and invoices for medical reports. Mr. Mullen did not respond and Dominion asked that I conduct an assessment of expenses. Mr. Mullen requested that the assessment be conducted in person rather than in writing or by teleconference. An in-person assessment of expenses was scheduled for Wednesday, May 23, 2001 at 10:00 a.m. at the offices of the Financial Services Commission of Ontario.
Mr. Mullen did not appear at the in-person assessment hearing, although it had been arranged for his convenience.
Analysis
The relevant portions of the Expense Regulation2 are as follows:
3.(1) The legal fees payable by the insured person or the insurer for the following matters may be awarded:
For all services performed before an arbitration, appeal, variation or revocation hearing.
For the preparation for an arbitration, appeal, variation or revocation hearing.
For attendance at an arbitration, appeal, variation or revocation hearing.
For services subsequent to an arbitration, appeal, variation or revocation hearing.
(2) The number of hours for which legal fees may be awarded shall be determined by the arbitrator, having regard to the criteria set out in subsection 12(2) of this Regulation.
(3) The maximum amount that may be awarded for legal fees is the amount calculated using the hourly rates set out in the Dispute Resolution Practice Code published by the Ontario Insurance Commission, as it may be amended from time to time.
The criteria set out in subsection 12(2) are used for determining entitlement to expenses of the arbitration proceeding. They are as follows:
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, an 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.
Dominion informed me of an Offer to Settle which was made to Mr. Mullen on March 28, 2000, prior to the scheduled arbitration hearing. Mr. Mullen did not respond to the offer and did not appear at the arbitration hearing. This is a relevant consideration when calculating the costs to be awarded to Dominion.
In its Draft Bill of Costs, Dominion claimed for a total of $2,238.30 in legal fees and $3,918.75 in disbursements.
Fees
Rule 76.1 of the Dispute Resolution Practice Code states:
The maximum amount that may be awarded to an insured person or an insurer for legal fees is an amount calculated using:
(a) the hourly rates established under the Legal Aid Act for professional services in civil matters before the Ontario Court (General Division); or
(b) the hourly rate referred to in Rule 76.1(a) adjusted to include, where appropriate, the experience allowance established under the Legal Aid Act; however, where an adjudicator is satisfied that a higher amount for legal fees to an insured person is justified, an hourly rate of up to $150 may be awarded.
Although Dominion submitted that this was a case of average complexity involving a self-employed applicant with soft tissue injuries, it claimed the maximum allowable hourly rate for counsel's time under Rule 76.1 of the Dispute Resolution Practice Code; that is, $150 per hour. Dominion made no submissions about the appropriateness of the maximum rate. I am not satisfied that a "higher amount for legal fees to an insured person is justified" in this case and award Dominion its fee expenses at the legal aid rates adjusted by the experience allowance for lawyers; that is, $83.75 an hour for Mr. McClelland and $23 an hour for the law clerk's time.
I accept the billing for the law clerk's time at 2.1 hours. That represents $48.30 in clerk's fees. The amount of hours claimed for counsel's time prior to the arbitration is 13.2 hours which includes one aborted pre-hearing, a pre-hearing and preparation time for the arbitration hearing. I have reduced the total to 9.2 hours. I accept the 2.0 hours which have been billed for the arbitration hearing for a total of 11.2 hours for counsel's time. Dominion is entitled to $938 in fees for counsel, and $48.30 in clerk's fees, for a total of $986.30 in legal fees.
Disbursements
Dominion has claimed $1,500 for the report of Dr. Michael Ross, $1,050 for the report of Dr. Gordon Hunter, and $1,200 for a Functional Abilities Evaluation from Work Able Centres.
Mr. Michael Ross from Canadian Trauma Consultants Limited specializes in occupational and organizational psychiatry. He prepared a report documenting his evaluation of Mr. Mullen on March 28, 2000. Dr. Gordon Hunter, an orthopaedic surgeon, conducted an insurer's medical assessment on September 1, 1999 and Dominion filed his report. Work Able Centres Inc. conducted a functional abilities evaluation on September 1, 1999 and Dominion filed this report. Mr. Mullen chose to discontinue the functional abilities evaluation prior to completing the necessary testing.
I am not prepared to award the total amount of expenses for the reports filed by Dominion. Although the reports were prepared for the arbitration hearing, they were not essential for my findings. The income tax returns which were filed were more important for my decision-making. However, I find that Mr. Mullen should bear a portion of the costs of the reports. Mr. Mullen should be responsible for $1,000 of the cost for the reports.
I accept Dominion's claim of $168.75 for photocopies, which appears reasonable.
The total amount owing for disbursements is $1,168.75.
Conclusion
From the outset, Mr. Mullen did not participate cooperatively in the dispute resolution process. He did not appear for an insurer's examination; he failed to appear for the first scheduled pre-hearing; he refused to complete a functional abilities evaluation; he failed to comply with his undertaking to produce various documents; he did not respond to an Offer to Settle; he did not appear at the arbitration hearing; and he failed to appear for the expense hearing. In these circumstances, it is appropriate that Mr. Mullen pay expenses to Dominion.
Mr. Mullen shall pay to Dominion a total of $2,155.05 plus applicable GST for expenses.
June 6, 2001
Judith Killoran
Arbitrator
Date
Neutral Citation: 2001 ONFSCDRS 86
FSCO A99-000078
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
KENNETH MULLEN
Applicant
and
DOMINION OF CANADA GENERAL 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. Mullen shall pay to Dominion $2,155.05 plus applicable GST for expenses.
June 6, 2001
Judith Killoran
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.
- Ontario Regulation 664 of R.R.O. 1990, as amended by Ontario Regulation 464/96