Neutral Citation: 2002 ONFSCDRS 152

FSCO A97-001776

FINANCIAL SERVICES COMMISSION OF ONTARIO

BETWEEN:

BLANKA SIMECKOVA

Applicant

and

ALLSTATE INSURANCE COMPANY OF CANADA

Insurer

DECISION ON EXPENSES

Before:

Fred Sampliner

Heard:

By telephone conference call on August 9, 2002. Written submissions were received on August 9, 2002.

Appearances:

Brian Sherman for Ms. Simeckova Ian D. Kirby for Allstate Insurance Company of Canada

Issues:

On November 16, 2001, Arbitrator Novick decided Mrs. Blanka Simeckova's claims for accident benefits under the Schedule,¹ resulting from injuries she received in a February 6, 1997 motor vehicle accident. The Arbitrator reserved on the issue of expenses, and I have been appointed to hear the parties' dispute concerning their respective claims for the expenses of this arbitration.

The issue is:

Is Mrs. Simeckova or Allstate entitled to an order for expenses incurred in this arbitration hearing?

Result:

Mrs. Simeckova is entitled to half of her expenses of the arbitration.

EVIDENCE AND ANALYSIS:

Mrs. Simeckova was partially successful in establishing her $8,902.14 claim for chiropractic treatments and rehabilitation expenses under Part V of the Schedule. She was awarded $1,715. 50, plus the statutory two percent compounded monthly interest² from the date that the benefits were overdue. The parties agree that the award should be modified to reflect that Allstate paid $636.12 prior to the hearing, which leaves $1,079.38 plus statutory interest owed at the time of the hearing.

Prior to the hearing, Allstate offered to settle Mrs. Simeckova's claims for $2,000, including all interest and her arbitration expenses. However, Mrs. Simeckova never accepted the June 28, 1999 offer before it expired on the day the hearing commenced, and there are no other settlement offers in this case.

Allstate argues that because the $2,000 offer was better than Mrs. Simeckova's recovery, she should not be awarded her expenses of the arbitration, and that she should pay the Insurer's arbitration expenses based on the two relevant criteria in subsection 73.2 of the Dispute Resolution Practice Code (DRCP):³

a) Each party's degree of success in the outcome of the proceeding; and

e) at the request of either party, any written offer to settle made in accordance with Rules 76 and 77, having regard to the outcome of the proceeding;

Mrs. Simeckova concedes that the $1,079.38 she was ultimately awarded with statutory interest to the date of the offer equals approximately $1,600, obviously less than what Allstate offered her, and she would have been better off to accept it in the summer of 1999 to avoid the expense of the hearing.

On the one hand, I do not accept that I am bound to rely on the Court's results-based system for awarding costs,⁴ and agree with previous decisions in this forum that insured persons should not fear insurer's expenses when bringing meritorious claims to a hearing.⁵ Settlement offers are only one criteria in evaluating an expense award, and I do not accept that Allstate is entitled to its expenses on the basis of the quantitative comparison between Mrs. Simeckova's recovery and her original claim.⁶

On the other hand though, Mrs. Simeckova had guidance on treatment rates in order to better predict the decision in this case from the Amoa-Williams and Allstate Insurance Company of Canada⁷ decision issued in June 2000. I find that Mrs. Simeckova had sufficient information to seriously consider the reasonableness of this offer⁸ for approximately half of the two years it was open. On that basis, I exercise my discretion to award her half of her expenses in this arbitration.

Allstate does not dispute that Mrs. Simeckova's representative spent 56 hours in this arbitration process nor that her agent is entitled to $50 per hour. There is no evidence of Mrs. Simeckova's disbursements except for the payment of the $100 arbitration filing fee. I find that Mrs. Simeckova is entitled to (56 hrs. x $50/hr. / 1/2 + $100) $1,500 for her expenses of the arbitration.

September 23, 2002

Fred Sampliner Arbitrator

Date