FSCO A01-000588

BETWEEN:

GRAEME ERSKINE

Applicant

and

PERSONAL INSURANCE COMPANY OF CANADA

Insurer

DECISION ON EXPENSES

Before: Catherine Skinner

Heard: Written submissions received by September 4, 2002 and a telephone conference call on January 9, 2003.

Appearances:

Graeme Erskine

Ralph D'Angelo for Personal Insurance Company of Canada

Issues:

The Applicant, Graeme Erskine, submits that he was injured in a motor vehicle accident on October 10, 2000. In a decision dated May 23, 2002, I dealt with his claims for statutory accident benefits under the Schedule.¹ I made the following orders:

Graeme Erskine's application is dismissed.
Graeme Erskine will pay Personal one-half of its arbitration expenses.

The issue in this further hearing is:

What is the amount of arbitration expenses to be paid by Mr. Erskine?

Result:

Mr. Erskine will pay Personal's arbitration expenses fixed in the amount of $2,522.91.

Arbitration Expenses Claimed

By written submission dated August 29, 2002, Personal claims total arbitration expenses of $5,979.56. It claims one half of that amount, or $2,989.78, from Mr. Erskine. Personal's total claim includes 60.75 hours of arbitration preparation and attendance time at a rate of $83.75 per hour. This hourly rate is calculated at the Legal Aid Tariff rate of $67.00 per hour, plus an experience increase of 25%.

Personal also claims the following disbursements:

Parking - $36.00

Mileage - $60.45

Court Reporter - $652.70

Wendy Willson's attendance and travel expenses - $102.20

Purolator Courier - $40.40

Mr. Erskine does not dispute the parking charge of $36.00 or the Purolator charge of $40.40.

Legal Fees

Mr. Erskine submits that the preparation time claimed by Mr. D'Angelo is excessive. In this case, Mr. D'Angelo is claiming preparation time of 37.75 hours and hearing time of 23 hours, for a ratio of approximately 1.6 hours of preparation time for every hour of hearing time. Based on the arbitration decision Smith and Citadel General Insurance Company,² Mr. Erskine submits that a more equitable ratio of preparation time to hearing time would be 1:1. Mr. Erskine also claims that the accurate number of hearing hours is 20, rather than 23.

In determining the reasonableness of claimed hearing preparation time, arbitrators have frequently adopted a ratio approach. As Arbitrator Makepeace commented in Singh and Allstate Insurance Company of Canada,³ "Arbitration decisions have generally followed this approach, awarding from one to four hours of preparation time for every hour of hearing attendance, depending on the complexity of the issues in the case, the volume of documentary evidence, the number of witnesses, and any other factors bearing on reasonable preparation time."

Relying on this and other arbitration decisions, I accept that establishing a ratio between preparation time and hearing attendance time is an appropriate basis on which to estimate reasonable preparation time.

In consideration of the nature of the issues in dispute, the number of witnesses called in this case and the moderate volume of documentary evidence, I find that a ratio of 1.6 hours of preparation time to 1 hour of hearing time is not unreasonable. The arbitrator in Smith and Citadel⁴ recognized that arbitrators generally allow between one and four hours of preparation time for each hour of attendance. The ratio of Mr. D'Angelo's claimed preparation time to his attendance time is within that range. I find that the number of hours for preparation claimed by Mr. D'Angelo is reasonable.

I accept that the arbitration hearing in this case lasted for 20 hours as opposed to 23 hours. My notes indicate a hearing time near 20 hours and Mr. D'Angelo did not offer any submissions to persuade me that the hearing attendance time was 23 hours.

I therefore reduce the total number of hours allowed to 57.75.

Experience Allowance

Mr. Erskine submits that the 25% increase in Mr. D'Angelo's hourly rate is not justified.

Rule 78.1 of the Dispute Resolution Practice Code (the "Code") provides that the maximum amount that may be awarded to an insurer for legal fees is calculated using the hourly rates established under the Legal Aid Services Act, 1998, S.O. 1998, c. 26, for professional services in civil matters before the Ontario Superior Court of Justice. Clause 78.1(b) of the Code provides that the hourly rate may be adjusted to include the experience allowance established under the Legal Aid Services Act, 1998.

Schedule 2 to the Legal Aid Services Act, 1998 prescribes an hourly rate of $67 for professional services in civil matters before the Ontario Superior Court of Justice. The Schedule also provides that hourly fees are subject to an increase of 25% for a lawyer who certifies that he or she has the equivalent of 10 years of practice in litigation, including at least four years of practice in civil litigation.

In this case, Mr. D'Angelo claims an hourly rate of $83.75, which is the basic rate of $67 per hour plus an experience allowance of 25%. Mr. D'Angelo certifies that he was called to the bar in the Province of Ontario in 1986 and that he has practiced since that time in the area of civil litigation. Although Mr. D'Angelo did not offer evidence of his date of call, I accept his representation in this regard as an officer of the court. Mr. Erskine did not challenge Mr. D'Angelo's date of call. Mr. D'Angelo indicates that he has practiced in the area of no-fault accident insurance benefits almost exclusively since being admitted to the bar. Mr. Erskine did not offer any evidence to challenge Mr. D'Angelo's experience or expertise in the areas of civil litigation and no-fault accident insurance benefits.

Based on Mr. D'Angelo's representations, I find that he is entitled to the experience adjustment of 25% and that Personal's legal fees are to be calculated at a rate of $83.75 per hour.

Mr. D'Angelo's Mileage

Mr. Erskine challenges Personal's claim for mileage in the amount of $60.45. He submitted that he was unaware of any arbitration decisions in which the insurer's counsel had been compensated for mileage incurred to attend an arbitration hearing.

I find that Personal is entitled to reimbursement of $60.45 for mileage incurred by Mr. D'Angelo for the purpose of attending the arbitration hearing. Subsection 6(1) of the Expense Regulation⁵ provides that the travelling expenses of the insurer's lawyer may be awarded. Subsections 6(1) and (2) of the Expense Regulation contemplate reimbursing an insurer's lawyer for mileage.

Mr. D'Angelo is in-house counsel for Personal and travelled from Hamilton to Toronto for the arbitration hearing. I find that his claim for mileage expenses of $60.45 is reasonable in this case.

Ms. Willson's Travelling Expenses

Mr. Erskine disputes the claimed disbursements in connection with Ms. Wendy Willson's attendance at the arbitration hearing. Ms. Willson, a former employee of Personal, was a witness at the arbitration hearing. Mr. Erskine had requested that she be present for cross examination and she was required to attend the arbitration hearing on two days in order to complete her examination in chief and cross-examination. Mr. Erskine submits that Ms. Willson was an in-house adjuster at the Personal at the time that he made his claim for accident benefits. Accordingly, he submits that he should not be responsible for paying her travel expenses.

It is undisputed that, at the time of the arbitration hearing, Ms. Willson was not an employee of the Personal. She had left the Personal and had begun working at Allstate. It is also undisputed that Ms. Willson travelled from Burlington to Toronto on two occasions to attend at the arbitration hearing. I find that she is entitled to her travelling expenses in accordance with section 5(2) of the Expense Regulation.

Specifically, I find that Ms. Willson is entitled to her parking expenses of $13.00 and mileage from Burlington to Toronto for two return trips. Ms. Willson claims mileage expense of 292 kilometres at a rate of 35 cents per kilometre. Mr. Erskine challenged the number of kilometres claimed but did not offer evidence of a more accurate mileage between Burlington and Toronto. Mr. D'Angelo was unable to justify the total kilometres claimed by Ms. Willson.

Having reference to MapQuest, an internet driving direction website, I find that a more accurate mileage from Ms. Willson's address in Burlington to the FSCO offices in Toronto is 61.89 kilometres for a one way trip. The total number of kilometres is therefore 247.56. Ms. Willson is entitled to reimbursement at a rate of 24 cents per kilometre in accordance with subsection 5(2) of the Expense Regulation. Her total mileage expense will be allowed in the amount of $59.41.

Ms. Willson claims reimbursement for the cost of travelling on Highway 407 to attend at the arbitration hearing. I find that this was a discretionary expense and that Mr. Erskine is not required to reimburse Ms. Willson for this expense.

Court Reporter Services

Mr. Erskine submits that the services of a court reporter are not an allowable disbursement under the Expense Regulation. Mr. D'Angelo submits that the services of the court reporter were required in furtherance of the arbitration because Mr. Erskine used the transcript of the proceedings in his appeal of my decision.

In both Smith and Citadel⁶ and Hughes and Allstate Insurance Company of Canada,⁷ arbitrators have found that the cost of a court reporter is not an allowable disbursement under the Expense Regulation. Having reference to the provisions of the Expense Regulation, I note that the cost of a court reporter is not enumerated as an allowable disbursement.

Mr. D'Angelo argued that this expense was incurred in furtherance of the arbitration and should therefore be allowed under section 4, paragraph 4 of the Expense Regulation. Although in this case the transcript was used in Mr. Erskine's appeal, I do not find that this is the type of expense that was intended to be captured in section 4, paragraph 4 of the Expense Regulation. I note that Personal was awarded $500 in expenses for the appeal proceeding. I do not allow the Personal's disbursement of $652.70 for the cost of a court reporter.

Summary

I find that Personal's total arbitration expenses are as follows: $4,836.56 for legal fees, $36.00 for Mr. D'Angelo's parking expense and $60.45 for Mr. D'Angelo's mileage, $40.40 for purolator costs, $59.41 for Ms. Willson's mileage and $13.00 for Ms. Willson's parking. Personal's total expenses are $5,045.82. Mr. Erskine is responsible for paying half of that amount or $2,522.91.

January 28, 2003

Catherine Skinner

Arbitrator

Date

ARBITRATION ORDER

Neutral Citation: 2003 ONFSCDRS 8