Zahra Garouspour v. Pembridge Insurance Company (Pafco Ins. Co.), 2004 ONFSCDRS 62

Neutral Citation: 2004 ONFSCDRS 62 FSCO A03-000642

BETWEEN:

ZAHRA GAROUSPOUR Applicant

and

PEMBRIDGE INSURANCE COMPANY (PAFCO INS. CO.) Insurer

and

KHALIL (EVAN) ISMAELI Representative of the Applicant

DECISION ON A MOTION

Before: Eban Bayefsky

Heard: April 30, 2004, at the offices of the Financial Services Commission of Ontario in Toronto. Order issued April 30, 2004.

Appearances: Khalil (Evan) Ismaeli for Mrs. Garouspour Mark L.J. Edwards for Pembridge Insurance Company (Pafco Ins. Co.)

Issues:

The Applicant, Zahra Garouspour, was injured in a motor vehicle accident on November 8, 2001. She applied for statutory accident benefits from Pembridge Insurance Company (Pafco Ins. Co.) ("Pembridge"), payable under the Schedule.¹ Pembridge denied certain of Mrs. Garouspour's claims for medical, attendant care and housekeeping benefits. The parties were unable to resolve their disputes through mediation, and Mrs. Garouspour applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The Commission conducted a pre-hearing conference in this matter on September 9, 2003. The arbitration hearing was scheduled for February 16, 17 and 18, 2004 at the Commission's offices in North York. By letter dated February 9, 2004, Mr. Ismaeli requested that the hearing be adjourned. By letter dated February 13, 2004, I granted the adjournment on the basis of certain conditions, set out below. I adjourned the hearing to June 28, 29 and 30, 2004. By letter dated March 3, 2004, Mr. Edwards brought a motion to have the arbitration dismissed and expenses awarded against Mr. Ismaeli personally, on the basis of Mr. Ismaeli's failure to comply with the conditions set out in my adjournment letter of February 13, 2004.

The issues in this hearing are:

Should Mrs. Garouspour's arbitration be dismissed on the basis of Mr. Ismaeli's failure to comply with the terms of the adjournment?
Is Mr. Ismaeli personally liable for Pembridge's expenses of the adjournment, pursuant to section 282(11.2) of the Insurance Act?

Results:

Mrs. Garouspour may proceed with her arbitration.
Mr. Ismaeli shall pay to Pembridge its expenses of the adjournment, fixed at $500.

EVIDENCE AND ANALYSIS:

By letter dated February 9, 2004, Mr. Ismaeli requested an adjournment of the hearing, as follows:

Please be advised that Mr. Ismaeli is going to be leaving on February 11/2004 for a Family emergency; please contact our office to reschedule the Arbitration for the above mention client. Your prompt to this matter is greatly appreciated.

By letter dated February 12, 2004, Mr. Edwards responded to Mr. Ismaeli's adjournment request, in part, as follows:

Mr. Ismaeli has done absolutely nothing to advance this matter since the pre-arbitration. He has not produced any documents. There is no indication that he has prepared the case for the arbitration. We have real doubts with respect to whether or not Mr. Ismaeli is in fact unavailable for the reasons that he has stated.

By letter dated February 13, 2004, I responded to Mr. Ismaeli's adjournment request as follows:

Your letter of February 9, 2004 requested that this matter be adjourned on behalf of Mrs. Garouspour. Due to your absence, the parties were not contacted to address your adjournment request.

The adjournment is granted from February 16-18, 2004 to June 28-30, 2004, at the offices of the Financial Services Commission of Ontario in North York, on the basis of Mr. Ismaeli having to attend to a family emergency. The adjournment is granted on the following conditions:

That Mr. Ismaeli submit in writing to Pembridge and the Commission, by February 25, 2004, a general description of the family emergency to which he had to attend and proof of his travel arrangements (given his letter that he was "leaving on February 11/2004 for a family emergency").

That, subject to Mr. Ismaeli's compliance with the first condition, Pembridge be permitted to make submissions on whether Mr. Ismaeli and/or Mrs. Garaspour be ordered to pay Pembridge's expenses of the adjournment.

That neither Mrs. Garouspour nor Mr. Ismaeli be given the opportunity to make further submissions with respect to the new dates for the hearing, given Mr. Ismaeli's failure to address with Mr. Edwards alternative dates for the hearing in the event the adjournment was granted (as provided for in Practice Note 9 on adjournment requests).

That the new hearing dates be peremptory to Mrs. Garouspour. No further adjournments will be granted except in extreme and unforeseen circumstances.

Neither the Commission nor Pembridge received anything from Mr. Ismaeli by February 25, 2004, as required pursuant to the first condition of the adjournment.

On March 3, 2004, Mr. Edwards brought the current motion to have the arbitration dismissed and costs awarded against Mr. Ismaeli personally.

By letter dated March 17, 2004, Mr. Ismaeli wrote the Commission and Mr. Edwards, in which he stated: "Enclosed please find a copy of Mr. Ismaeli's ticket to Iran as you requested." Attached to this letter was an E-Ticket for Mr. Ismaeli for a flight from Toronto to London on February 11, 2004 and from London to Amsterdam on February 12, 2004. Attached as well were boarding passes for Mr. Ismaeli for flights on February 12th from London to Amsterdam and from Amsterdam to Toronto on February 25th. Finally, Mr. Ismaeli attached boarding passes for an Abrahimkha Ismaeli for flights from Tehran to Frankfurt and from Frankfurt to Toronto on January 10th (presumably of 2004).

On March 25, 2004, Mr. Edwards wrote Mr. Ismaeli concerning this documentation, stating, in part, as follows:

So that there can be absolutely no doubt in this regard may I suggest that you produce to me relevant extracts from your passport showing when you left the country and when you returned to the country. In addition you have not satisfied that portion of Arbitrator Bayefsky's conditions indicating why you had to leave the country on such short notice.

Mr. Ismaeli did not respond to this letter.

Section 282(11.2) of the Insurance Act states, in part, that an arbitrator can award costs against a representative personally if the "representative caused expenses to be incurred without reasonable cause or to be wasted by unreasonable delay or other default." For the following reasons, I find that Mr. Ismaeli failed, without reasonable explanation, to comply with the conditions of the adjournment and that he is, therefore, liable for Pembridge's costs of the adjournment.

At the motion, Mr. Ismaeli stated that he was aware of the process under the Dispute Resolution Practice Code for seeking adjournments (for example, addressing with the other party alternative dates for the hearing), but had no explanation as to why he did not follow this process. Despite Mr. Ismaeli's failure in this regard, and given the nature of his request, I granted the adjournment. However, as Mr. Ismaeli essentially presented the Commission with a fait accompli, I attached certain conditions to the adjournment. Mr. Ismaeli stated that he neither saw nor responded to my February 13th adjournment letter (setting out the conditions of the adjournment) until February 26th or 27th because he was out of the office. However, he said that his office should have responded to the letter. Mr. Ismaeli stated that, once he returned to his office, he did not respond to the letter because his office was in the process of moving and he did not have a chance to look at the file. However, on March 17th, Mr. Ismaeli wrote the Commission attaching copies of certain flight documentation. He did not provide a "general description of the family emergency to which he had to attend," as required by the first condition of the adjournment. I note that Mr. Ismaeli only responded following Mr. Edwards' March 3rd letter seeking a dismissal of the motion and costs against Mr. Ismaeli personally. I do not accept Mr. Ismaeli's explanation for his failure to comply with the conditions of the adjournment. In my view, either Mr. Ismaeli or his office ought to have responded to my February 13th letter by February 25th, setting out the general nature of his family emergency and providing the required documentation. At the very least, Mr. Ismaeli's office ought to have explained that he was unable to respond to my February 13th letter and the reasons therefor. Failing this, Mr. Ismaeli ought to have provided the relevant information in his March 17th correspondence.

At the motion, Mr. Ismaeli stated that the family emergency was the recent earthquake in Iran (which I note took place on December 26, 2003, roughly six weeks prior to his adjournment request) and that he had to fly back home. However, Mr. Ismaeli did not explain this in his initial "request" for an adjournment, he stated that his own office did not know the reason for the family emergency (and, therefore, was unable to respond to my February 13th letter), and the flight documentation he provided does not pertain to a trip he may have taken to Iran. At first, Mr. Ismaeli stated that he did not respond to my February 13th letter upon returning from overseas, because his office was in the process of moving and he did not have a chance to look at the file. However, he also said that he was not able to respond to my February 13th letter until March 17th because he was out of town again dealing with the situation in Iran. Further, even in his March 17th correspondence, he did not indicate the nature of his absence or provide documentation pertinent to his apparent need to return to Iran. While the situation in Iran was clearly a very serious one, and while Mr. Ismaeli may have needed to respond in some fashion, on the basis of the information before me, I do not accept that this was the basis of either Mr. Ismaeli's initial adjournment request or his failure to comply with the conditions upon which the adjournment was granted.

Pembridge acknowledged that Mrs. Garouspour was in no way responsible for the initial adjournment or any of the subsequent activity on the case, and that it would be improper to dismiss her arbitration on the basis of Mr. Ismaeli's conduct. In any event, I am not satisfied that Mrs. Garouspour's arbitration is frivolous or vexatious or was commenced in bad faith, as required by Rule 68 of the Dispute Resolution Practice Code (dealing with the dismissal of a proceeding without a hearing). I am, therefore, not prepared to dismiss Mrs. Garouspour's arbitration.

However, based on the above, I find that Mr. Ismaeli failed without reasonable explanation to comply with the conditions that formed the basis of my initially granting the adjournment. I find that Mr. Ismaeli breached section 2.13 of the Code of Conduct for Statutory Accident Benefit Representatives, by which he was required to comply with the procedural requirements under the Dispute Resolution Practice Code and the orders of an arbitrator. Pembridge submitted that it incurred expenses preparing for the February arbitration and in respect of the adjournment proceedings. Pursuant to the second condition of the adjournment, Pembridge sought these expenses from Mr. Ismaeli in the range of $500 to $750. I find that Mr. Ismaeli caused Pembridge to incur expenses without reasonable cause and by default. I order Mr. Ismaeli to pay to Pembridge its expenses of the adjournment, fixed at $500.

April 30, 2004

Eban Bayefsky Arbitrator

Date

ARBITRATION ORDER