Neutral Citation: 2002 ONFSCDRS 155
FSCO A00-000031
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
OM DHAWAN
Applicant
and
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
Insurer
DECISION ON EXPENSES
Before:
Beth Allen
Heard:
On September 6, 2002
Appearances:
Mr. Dhawan, unrepresented
Ian D. Kirby for State Farm Mutual Automobile Insurance Company
Background and Issue:
The Applicant, Om Dhawan, was injured in a motor vehicle accident on June 28, 1998. He applied for and received statutory accident benefits from State Farm Mutual Automobile Insurance Company ("State Farm"), payable under the Schedule.1State Farm terminated benefits for physiotherapy under section 14 and refused to pay expenses associated with certain medical examinations claimed pursuant to section 24 of the Schedule.
The Applicant applied for arbitration by two applications for arbitration, one dated April 12, 1999 and the other undated, but received by the Commission on January 4, 2000.
Before the arbitration hearing, the parties entered into settlement discussions where, according to State Farm, the parties reached a binding, full and final settlement of all issues in dispute as well as all outstanding and future claims. The Applicant denied that a resolution was reached. On February 26, 2001, I conducted a hearing into the preliminary issue of whether the Applicant was precluded from proceeding to arbitration by reason of a full and final agreement having been reached between the parties.
By a decision dated April 20, 2001,2 I found that there was a valid, binding settlement of all of the Applicant's past, present and future claims against State Farm in relation to his June 28, 1998 accident.
The Applicant appealed the April 20, 2001 arbitration decision and by appeal decision dated February 1, 2002,3 the Director's Delegate ordered Mr. Spiegel, a paralegal, excluded from the appeal proceeding pursuant to section 23(3) of the Statutory Powers Procedure Act4 on the basis of his inappropriate conduct in order to preserve the integrity of the appeal proceedings. The Director's Delegate set a deadline for the Applicant to notify State Farm and the Commission as to whether he intended to proceed with the appeal hearing. The appeal hearing was continued with the Applicant unrepresented. By decision dated May 16, 2002,5 the Director's Delegate dismissed the Applicant's appeal and ordered expenses against him.
State Farm requested a hearing into the issue of arbitration expenses.
Issue:
Is the Applicant liable to pay State Farm's arbitration expenses pursuant to subsection 282(11) of the Insurance Act, R.S.O. 1990, c.I.8, as amended?
The Applicant does not request that State Farm pay any arbitration expenses he might have incurred.
Result:
The Applicant is required to reimburse $2,004.65 of State Farm's arbitration expenses.
EXPENSES:
Mr. Kirby made submissions on behalf of State Farm. The Applicant represented himself. By a fax transmission dated June 24, 2002 to the case administrator on the file, the Applicant stated that Mr. Spiegel would no longer be representing him in this matter. Although in this fax the Applicant indicated that he was intending to retain counsel for the expense hearing, there is no indication in the Commission's file that the Applicant attempted to do so. However, he confirmed at the commencement of the hearing that he would be representing himself.
Before the day of the hearing into the expense issue, through the case administrator on the file, I requested that the parties exchange and file with the Commission written submissions on the expense issue. Mr. Kirby did so through a letter dated September 4, 2002 to the case administrator and copied to the Applicant. As evidenced in a written memorandum from the case administrator in the Commission file, the Applicant stated in a telephone conversation with the case administrator on September 4, 2002 that he was claiming nothing in expenses from State Farm and would not make any written or oral submissions on this matter. Nor did the Applicant make submissions at the arbitration hearing on why he should be relieved from paying State Farm’s arbitration expenses.
State Farm's Submissions:
Entitlement to Expenses:
In his written and oral submissions, Mr. Kirby argued that State Farm is entitled to its expenses from the Applicant and should not be required to pay any of the Applicant's expenses. He based his argument on the authority given arbitrators under the Insurance Act, the Expense Regulation,6 and Rule 75 of the Dispute Resolution Practice Code7 (the "Code").
Subsection 282(11) of the Insurance Act authorizes arbitrators to award arbitration expenses to the parties of an arbitration hearing in accordance with criteria prescribed by section 12 of the Expense Regulation which contains essentially the same wording as Rule 75 of the Code.
An arbitrator may award expenses to an insurer or insured person under subsection 282(11) of the Act if the arbitrator is satisfied that the