Neutral Citation: 2002 ONFSCDRS 156
FSCO A00-001061
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
ROD HARE, in the name of: ASHLEY PIOTTO, a minor
Applicant
and
KINGSWAY GENERAL INSURANCE COMPANY
Insurer
INTERIM DECISION ON EXPENSES
Before:
John Wilson
Heard:
By written submissions
Appearances:
Jamie Pollack for Kingsway General Insurance Company
Issues:
The named Applicant, Ashley Piotto, a minor, was injured in a motor vehicle accident on February 10, 2000. In a decision dated March 22, 2002, I dealt with the claim brought in her name for statutory accident benefits under the Schedule.1 I made the following orders:
Ms. Piotto's name shall be removed from the arbitration, and Mr. Rod Hare shall be noted as the Applicant party in this matter.
Mr. Rod Hare shall have 30 days from the date of service of the Insurer's Bill of Expenses in this matter to respond to the claim against him for expenses, failing which he may be found personally responsible for the expenses claimed by the Insurer.
Counsel for the Insurer has since filed his Bill of Expenses together with an affidavit of service affirming that it was served on Mr. Rod Hare at the address for Profile Evaluations, by regular mail. Profile Evaluations is the name of the establishment whose name appeared on the Application for Arbitration. Mr Hare repeatedly represented himself as "Director/Proprietor" of Profile Evaluations. Mr. Hare has not filed any response in this matter
The issue in this further hearing is:
- Is the Insurer entitled to an order that Mr. Rod Hare pay its expenses incurred in respect of this arbitration hearing?
Result:
- The Insurer shall serve Mr. Hare, personally, with its claim for expenses, before the Insurer's claim for expenses will be considered.
EVIDENCE AND ANALYSIS:
The arbitration decision, which was issued on March 22, 2002, was sent, as a matter of course, to Mr. Hare at the address he had provided on the Application for Arbitration, that of Profile Evaluations at 530 Wilson Avenue, Ste. 202, Toronto Ontario, M3H 5Y9.
On April 25, 2002, The Commission received a letter from Mr. Mark Rowe at the above address. Mr. Rowe, in his letter dated April 19, 2002, stated that "Mr. Hare ceased to have any involvement with Profile Evaluations as of March 8, 2002."
In the meantime, counsel for the Insurer had served its Bill of Expenses on Mr. Hare, by delivering the same to the address of Profile, by regular mail.
On May 9, 2002, Mr. Rowe wrote again to the Commission, and reiterated his previous statement that Mr. Hare could no longer be reached through Profile Evaluations., and requested that "your office contact Mr. Hare directly and provide him with copies of the decision and associated correspondence."
On May 16, 2002, counsel for the Insurer wrote again to the Commission noting that "it is now more than 30 days from March 28, 2002, and Mr. Hare has not responded." He continued:
As a result, we are respectfully requesting an Order for the insurer's expenses payable by Mr. Hare, including payment/return of the assessment fee levied by the Financial Services Commission, as paid by the Insurer.
The copy of the letter indicates that it was also sent to Mr. Hare, but in care of Profile Evaluations.
The claim against Mr. Hare arose from a motion brought by the Insurer, that requested, inter alia, a dismissal of the arbitration application, and the Insurer's expenses, payable "forthwith by Ashley Piotto, Rod Hare and/or Profile Evaluations."
The notice of motion and the motion record were served on Mr. Hare at Profile Evaluations. I accept that he, indeed, received them at that address. As noted in the original decision on the motion, Mr. Hare wrote to counsel for the Insurer, returning the documents, stating that he was "no longer involved in this matter." Whether he chose to read the motion documents or not, it is clear that Mr. Hare's December 12, 2001 letter is a confirmation of actual knowledge of the Insurer's motion.
The service of the Bill of Expenses is, however, more problematic. Although the Insurer chose a method outlined in the Practice Code to serve the document on Mr. Hare, we have a statement by the current proprietor of the clinic that Mr. Hare had left on March 9. A strong inference that can be drawn from Mr. Rowe's letter to the Commission is that anything sent to Profile Evaluations would no longer be brought to the attention of Mr. Hare.
Rule 7 of the Practice Code deals with the service of documents. Subrule 7.1 lists the alternative methods available:
A document must be served by one of the following methods:
(a) personal delivery;
(b) regular, registered or certified mail;
(c) courier service, including Priority Courier;
(d) facsimile;
(e) document exchange on a person who participates in an exchange service;
(f) electronic transmission; or
(g) any other manner specified by the Director.
While mailing the documents to Mr. Hare, is a form of delivery approved by the Commission in subrule. 7.1 (b), the question then must be asked whether the utilization of any approved method of service provides Mr. Hare with sufficient reasonable notice to respond to the claims made against him.
The purpose of service is to fulfill the common law duty of notice and to let an individual know that his or her rights or interests might be adversely affected by the exercise of a power of decision by a tribunal. As the Divisional Court noted, per Reid J. in Re Collins et al. and Pension Commission of Ontario et al. 1986 CanLII 3913 (ON HCJDC), 56 O.R. (2d) 274:
The object of requiring notice would be, of course, to give the union or plan members an opportunity to defend their interest. They could not do this without knowing what the application was based on, so they would have to be furnished with the documents supporting the application.
Patently, the notice provision is not a mere formalistic step, but one that can realistically draw the attention of the party being served to the proposed procedure, and to give him or her the opportunity to defend whatever interest is at stake, if so advised.
The Common Law has always been that notice of a proceeding must be served directly upon the party affected by the claim. As was stated in Thomson v. Pheney (1832), 1 Dowl. 441, "personal service may be where you see a person and bring the process to his notice." Although the procedures at FSCO contemplate alternative means of service, in certain circumstances, the common law duty of notice demands that only personal service be acceptable.
I am concerned that, in light of Mr. Rowe's letters to the Commission concerning Mr. Hare's departure from Profile Evaluations, there is a distinct possibility that the notice of the expense claim against Mr. Hare personally may not come to his notice, if served at the address of Profile Evaluations.
The courts have dealt, from time to time, with the question of whether personal service can be safely dispensed with. The court Rules, indeed, provide for substitute service in certain situations. As Orde J. noted, however, in De Camps v. Sainsbury [1921] O.J. 118, on appeal from a master's order for substitute service:
an absentee defendant might conceivably find upon his return that his property had been seized and sold under an execution upon a judgement recovered against him in his absence, in an action of which he had no notice whatever. There is of course always risk of that in the case of an order for substitutional service, even where it is properly made, because the person served substitutionally may fail to communicate the fact to the defendant with whom it is alleged he is in communication.
The relief requested by the Insurer in this matter includes the payment of the $3,000 assessment fee incurred by it as a result of this arbitration, and the payment of its expenses to date. If an order is made against Mr. Hare, the order may be registered in the same manner as a judgement of the court, and enforced by the Insurer. Clearly, this matter has potential, serious, consequences for Mr. Hare.
In Fekete v. 415585 Ontario Ltd., 1988 CanLII 4586 (ON HCJ), 64 O.R. (2d) 542, an appeal from the decision of Master Sandler finding a former solicitor, a non-party, liable for the costs of a motion, Austin J. concluded:
The lawyer in question must be afforded full opportunity to meet the case against him. It does not appear that he was given that opportunity.
He concluded:
In the present case the master clearly had jurisdiction in the general sense but in my view he lost it by proceeding, or appearing to proceed without affording S. any real opportunity to deal with the threshold issue of liability.
Although the originating motion in this matter, which resulted in a finding that Mr. Hare was the true applicant, was properly served upon Mr. Hare, I am not content to simply issue "an Order for the insurer's expenses payable by Mr. Hare" on that basis. The finding that he was a party was somewhat novel, and Mr. Hare would have had some basis not to anticipate personal consequences upon his non-attendance at the previous motion.
I note, as well, the fact that there has been no finding, as of yet, that Mr. Hare should bear the Insurer's expenses.
Given the doubt cast on Mr. Hare's availability at Profile by Mr. Rowe at the time of the delivery of the decision, and the service by mail of the Insurer's motion for costs, I would like to be satisfied that Mr. Hare has been served in an approved manner with the order of March 22, 2002, and the full motion materials for the Insurer's claim for expenses, before even considering the Insurer's request that he be noted in default.
Therefore, if the Insurer wishes to proceed further with its claim against Mr. Hare, it should obtain a fixed date for its motion from the Commission and proceed to serve the above-mentioned documents personally on Mr. Hare.
Given Mr. Rowe's letters to the Commission in this matter and his claimed financial interest in this matter, he should also be served with the notice of motion, in the event that he wishes to apply to the Commission for status to be heard.
September 30, 2002
John Wilson
Arbitrator
Date
Neutral Citation: 2002 ONFSCDRS 156
FSCO A00-001061
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
ROD HARE in the name of: ASHLEY PIOTTO, a minor
Applicant
and
KINGSWAY 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:
- The Insurer may proceed with its motion for expenses against Mr. Hare only upon proof of service of all motion documents personally upon Mr. Hare.
September 30, 2002
John Wilson
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, 303/98, 114/00 and 482/01.