Neutral Citation: 2004 ONFSCDRS 86
FSCO A02-001375
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
FRANK BLUM
Applicant
and
AVIVA CANADA INC.
Insurer
DECISION ON AN ADJOURNMENT
Before: John Wilson
Heard: By telephone conference call on May 20, 2004. Written submissions were received on June 2 and June 3, 2004.
Appearances: Judith A. Hull for Mr. Blum Robert H. Rogers for Aviva Canada Inc.
Issues:
The Applicant, Frank Blum, was injured in a motor vehicle accident on May 15, 1999. He applied for statutory accident benefits from Aviva Canada Inc. ("Aviva"), payable under the Schedule.1 The parties were unable to resolve their disputes through mediation, and Mr. Blum applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.
Initially, a hearing on a preliminary issue was set at the request of the Insurer for March 31 and April 1, 2003. That hearing was adjourned due to an attempt by the Insurer, on the eve of the hearing, to add further issues to the hearing. A further hearing date was set for July 22, and 23, 2003 which did not proceed. The hearing was then set to commence on October 6, 2003.
At a further pre-hearing on September 22, 2003, the Insurer requested a further adjournment to deal with private mediation, the production of documents and the appointment of new counsel.
The arbitration was then re-scheduled for May 31 to June 3, 2004.
On May 18, 2004, Mr. Dickson first wrote to Ms. Hull to indicate that Mr. Rogers, the new counsel for Aviva, was involved in a trial and that an adjournment would likely be requested. Ms. Hull was not prepared to agree to yet another adjournment of this matter. She stated that the Applicant was ready and willing to proceed on the agreed date.
On May 20, 2004, Mr. Dickson, on behalf of Mr. Rogers, the counsel of record, confirmed that the Insurer was asking for a "short adjournment" to accommodate an extended jury trial.
Also on May 20, 2004, after having heard oral submissions from Mr. Dickson and Ms. Hull, I adjourned the matter to a date to be agreed upon or, failing agreement, to be set by me. I also ordered that the adjournment be subject to an expense order against Aviva.
The issues are:
What should be the quantum of the expense order against Aviva?
What date should be set for the adjournment?
Result:
Aviva shall pay Mr. Blum forthwith the amount of $5,964.61 as his fixed expenses. This order shall be payable in any event of the cause.
The arbitration hearing will commence on July 12, 2004, in London.
EVIDENCE AND ANALYSIS:
As noted above, this matter has had a long and difficult progression to a hearing which has not yet been completed.
All adjournment requests must be examined in light of the purposes of the arbitration system.
The Introduction to the Dispute Resolution Practice Code (3rd edition, May 31, 2001) (the Practice Code), which governs arbitrations at the Commission, notes that our procedural rules aim to promote "timely, cost-effective and fair dispute resolution services." Since the principal alternative to arbitration of accident benefits disputes at the Commission is a legal proceeding instituted in the Ontario Superior Court of Justice, the measure of the timeliness and effectiveness of arbitration must be in relation to those courts. In light of recent reforms to court procedures, including case management of most matters, every effort must be made to maintain the strict time requirements of the arbitration system.
The preamble to Practice Note 9, which deals with Adjournments, provides:
The Commission has an obligation to conduct arbitrations efficiently and speedily. Parties are contacted and agree to pre-hearing and hearing dates well in advance of the dates set. Therefore, adjournments are granted only sparingly once dates have been set.
The approach long taken by the Commission on adjournments is similar in many respects to the new Practice Directions issued by both the Superior Court of Justice and the Ontario Court of Justice on June 8, 1999. These provide:
1(1) Where a date for trial or for the hearing of a matter has been set by the Superior Court of Justice or the Ontario Court of Justice, the trial or hearing is expected to take place on that date.
1(2) By agreeing to a trial or hearing date, a lawyer is presumed to have made a commitment to appear on that date and to be bound not to make any other commitments that would make the lawyer's appearance on that date impossible.
2(1) When setting a date for trials, hearings or appeals, in the Superior Court of Justice or the Ontario Court of Justice, every lawyer has a duty to disclose previous commitments to another court that may conflict with a proposed date for a trial, hearing or appeal.
While obviously the policy of the courts does not directly apply in the context of arbitrations, the direction is illustrative of the current general expectations of conduct in the context of fixing hearing dates. It also sets the bar which the arbitration process is meant to exceed.
Unlike the traditional rule in the courts, the arbitration system is designed to work on strict time discipline.2 Hearing dates are set on the consent of both parties, and are subject to revision only in cases of personal emergencies, the prospect of imminent settlement, or the unforeseen unavailability of critical evidence, or the involvement of counsel in an ongoing proceeding that was scheduled to conclude before the time scheduled for the arbitration. Barring the occurrence of circumstances such as those described above, they are expected to be able to proceed within the agreed time-frame. This is consistent with a system that is designed to be "quicker, less expensive and less formal"3 than the courts.
The Practice Code4 provides that:
An Application for Arbitration in FORM C will be registered and assigned to an arbitration case administrator within 5 business days of receipt of an Application completed in accordance with Rule 25.1.
Dates for holding an arbitration pre-hearing discussion (Rule 33) will be available to the parties within 6 to 8 weeks from the registration of a completed Application for Arbitration.
Dates for holding an oral arbitration hearing will be available to the parties within 4 to 6 months from the conclusion of the pre-hearing discussion.
An oral arbitration hearing is generally concluded within 3 days.
An arbitration order from an oral hearing will be issued within 60 to 85 days from the conclusion of the oral hearing.
Thus, according to the Practice Code, an insured may reasonably expect a ruling on benefit entitlements in less than a year from the commencement of the arbitration process.5
The practice at the Commission with regard to adjournments has long reflected such a need to bring matters promptly to hearing. Even an actual or contemplated change of counsel does not give rise to an automatic right to an adjournment. As Arbitrator Wacyk noted in one case:
He was given more than six months to retain counsel, and had not objected to the dates for which the preliminary issues hearing had been rescheduled. Consequently, I did not find that Mr. Sakhuja's failure to retain counsel within that somewhat generous time frame to constitute extreme and unforeseeable circumstances so as to support the granting of yet another adjournment. Rather, as I noted at the time, Mr. Sakhuja had ample opportunity to retain counsel, and was given clear warnings that he would be required to proceed with the preliminary hearing, even if unrepresented — which he undertook to do.6
Notwithstanding his professed intention to retain new counsel, Mr. Sakhuja was denied his adjournment.
As noted earlier, the courts are now taking a not dissimilar approach. In a recent case, notwithstanding an agreement by a lawyer to take on a trial, if adjourned, the court not only refused the adjournment but dismissed the plaintiff's case altogether. On appeal, Doherty J.A., speaking for the Court of Appeal, outlined the importance of fixed hearing dates, even in the context of a change in counsel:
Individual litigants have a right to pursue and defend their respective claims. They must do so, however, within a court structure that must accommodate thousands of individual litigants. That system can function effectively only when litigants take scheduling commitments seriously and make genuine efforts to comply with court orders relating to adjournments and related matters. Where a litigant successfully obtains the adjournment of a trial having failed to exercise due diligence in retaining counsel, that litigant must expect that absent unforseen circumstances, the trial will proceed on the new date.7
This is essentially the same approach taken by the Commission in Rule 72 and Practice Note 9 of the Practice Code..
Although I certainly make no finding of fault on the part of Mr. Rogers, or his firm, Evans, Philp, he should have appreciated, as an experienced barrister, when he took over the file from in-house counsel at Aviva, that he would be expected to be willing and able to proceed on the scheduled May 31 hearing commencement date. That, indeed, was the commitment that had been given by his client in choosing that hearing date.
If there were any foreseeable problems on the horizon that could have impinged on the hearing date for this matter, Mr. Rogers should have either declined the brief, or made alternative arrangements, in the event that he was unavailable.
In any event, there appears to have been no notice or warning provided to the Applicant's counsel in March 2004, when a jury trial scheduled for three weeks was postponed, ultimately until May 10, 2004.
Mr. Roger's associate, Mr. Dickson, argued that I should take into consideration that this would be the first adjournment requested by his firm in this matter. Ms. Hull, however, took the view that I must take notice of the entire conduct of the Insurer since the arbitration was commenced, in making any decision on adjournment.
I accept Ms. Hull's approach as more accurately reflecting the conduct of the party, which is in issue in this case.
While there was ample reason to deny the adjournment request and order the parties on, I accepted Mr. Dickson's submission that to do so would deprive the Insurer of representation, since no one else in his firm was available to take the matter forward.
I also accepted, however, Ms. Hull's characterization of the prejudice that had accrued to her client due to the ongoing delays. A further adjournment would significantly add to the delay and costs to the Applicant in undertaking, once again, the preparation for the hearing at a later date. It would also delay justice, and undermine the timeliness of the arbitration process.
As Laskin J. stated in Khimji v. Dhanani Estate (supra), "Under our modern Rules non-compensable prejudice plays a pivotal role in deciding whether to grant an amendment or an adjournment." While I acknowledged the Applicant's prejudice, I did not accept that it constituted non-compensable prejudice.
Rule 72.4 of the Practice Code specifically provides for adjournments being "on such terms as he or she [the adjudicator] considers just."
Rule 75 of the Practice Code sets out the criteria for an award of expenses. Among the considerations contained in Rule 75.2 is the conduct of a party that tended to prolong, obstruct or hinder the proceeding.
Some 26 months have passed since the Application for Arbitration, without a hearing or a decision on Mr. Blum's entitlement to benefits. Absent extraordinary circumstances, I find this to be an unacceptable delay.
I further find that the inability of the Insurer to proceed to the scheduled hearing date on May 31, when taken in the context of the prior, serial, adjournments, all of which implicated the Insurer, constituted a pattern of conduct that tended to prolong the proceeding unduly.
In addition, by failing to notify the Applicant early of the changed situation regarding Mr. Roger's other commitments, the Insurer's counsel let the Applicant incur unnecessary expenses in preparation for the hearing that was not to take place.
Consequentially, while allowing a short adjournment, I ordered it to be subject to an expense order. I also gave the parties two weeks to fix an agreed date for the hearing. Unfortunately, they were unable to do so. Ms. Hull had some early dates available, while those provided by Mr. Rogers were either some months hence, or at a time when key witnesses were unavailable.
In the absence of agreement, I am obliged to set dates. Given that the Insurer had requested a "short adjournment" and the fact that previous delays may be attributable at least in part to the Insurer, I am unwilling to consider setting a much later date, without the consent of the Applicant.
Consequently, I order that the hearing shall take place in London commencing July 12, 2004, a date which is about one month away, and on which the counsel for the Applicant is available. I also note that counsel for the Insurer is reported to be likely available at that time.
I note, as well, that there are some 20 practising lawyers listed on the letterhead of Mr. Roger's firm. I find it highly unlikely that he will be unable to find a qualified replacement in his firm's ranks in the intervening months if he turns out to be unavailable for the hearing.
Amount of Expense Order
My original expense order referred to costs "thrown away". Ms. Hull filed a Bill of Expenses relating to her preparation for the May 31 hearing, and related disbursements. Her total account, including disbursements and G.S.T., is for $5,964.61. The account does not address costs incurred prior to April 8, 2004, including any expenses arising from any previous adjournments. This account was filed with counsel for the Insurer, who had the opportunity to comment and make further submissions.
The only items addressed in particular by the Insurer are the costs related to the service of certain summons to witness, and, in general, whether or not preparation time could be considered "costs thrown away" when such preparation may still be relevant to a future arbitration. There was no challenge to the amount of time spent on preparation, nor on the rates billed by counsel.
Notwithstanding Mr. Dickson's comments, I find that Ms. Hull's expenses seem to be appropriate in the context of the preparation for what appears to be a potentially complex hearing lasting several days. The service of the summons and the preparation of witnesses are merely what is expected of competent, informed counsel.
I also accept that Ms. Hull's claim of the $150 rate for experienced counsel is appropriate, given her year of call, and the professionalism that was apparent in her submissions.
Notwithstanding Mr. Dickson's objections, I find that her bill for hearing preparation is both appropriate and related to the time of the order. I accept Ms. Hull's assertions that she will require more time to again prepare herself and witnesses prior to any adjourned hearing.
Even if there is some necessary duplication in preparation, the hearing arbitrator may take this expense order into consideration in the calculation of any further expense order.
The Insurer shall, therefore, pay to Mr. Blum, forthwith, the amount of $5,964.61, being his fixed costs, in accordance with my earlier order. This expense award shall be in any event of the cause.
June 9, 2004
John Wilson Arbitrator
Date
Neutral Citation: 2004 ONFSCDRS 86
FSCO A02-001375
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
FRANK BLUM
Applicant
and
AVIVA CANADA INC.
Insurer
ARBITRATION ORDER
Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
Aviva shall pay Mr. Blum forthwith the amount of $5,964.61 as his fixed expenses. This order shall be payable in any event of the cause.
The arbitration hearing will commence on July 12, 2004, in London.
June 9, 2004
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.
- Even the courts under case management have adopted a more stringent attitude towards time. A plaintiff chooses the "track" for the litigation. Once something is fast-tracked, "the parties will have to provide very compelling reasons before a case management judge will permit any changes of track or to the timetable." Introduction - Case Management Rules, Ontario Annual Practice. It is important that Rule 77 - Case Management-prevails over any preceding Rule.
- Practice Code Introduction at p. 10
- Practice Code Introduction at p.13
- Historically arbitration has been seen as an efficient, time-sensitive alternative to the courts. In 1856 Lord Campbell in Scott v. Avery 5 H.L. Cas. 811 remarked: " Is there anything contrary to public policy in saying that the company shall not be harassed by actions to be brought against them, the costs of which might be ruinous, but that any dispute that arises shall be referred to a domestic tribunal, which may speedily and economically determine the dispute?
- Sakhuja and Markel Insurance Company of Canada (FSCO A98-000839, September 6, 2000)
- Khimji v. Dhanani Estate 2004 CanLII 12037 (ON CA), [2004] O.J. No. 320