Financial Services Commission of Ontario
Commission des services financiers de l’Ontario
Neutral Citation: 2005 ONFSCDRS 110
FSCO A03-001543
BETWEEN:
HERMINIGILDO NONAN Applicant
and
TD HOME AND AUTO INSURANCE COMPANY Insurer
DECISION ON EXPENSES
Before: Lorne Slotnick
Heard: Written submissions received by June 15, 2005.
Appearances: Raj Napal for Mr. Nonan Michelle Brown for TD Home and Auto Insurance Company
Issues:
The Applicant, Herminigildo Nonan, applied for statutory accident benefits under the Schedule1 after an injury sustained on September 16, 2001. A preliminary issues hearing was scheduled to decide whether Mr. Nonan's impairment was the result of an accident as defined by the Schedule.
The matter was originally scheduled for November, 2004, but was adjourned to March, 2005 and marked peremptory to the applicant. Mr. Nonan failed to appear on the March date and I adjourned the matter as there appeared to be some chance that he was out of the country because of a family emergency. When Mr. Nonan's counsel was unable to find out any more information, I set the hearing for April 26, 2005. The day before the hearing, Mr. Nonan's counsel, Raj Napal, advised that neither he nor his client would be attending.
In a decision dated May 9, 2005, I dismissed Mr. Nonan's application and said I would order expenses paid to the insurer. Because of Mr. Napal's failure to attend the hearing for which he was counsel of record, I put him on notice that he may be held personally liable for a portion of the insurer's expenses.
The issue in this further hearing is:
To what amount of expenses is TD entitled?
Is Mr. Napal as counsel liable to pay any portion of the expenses?
Result:
TD is entitled to expenses of $3,588.72, payable by Mr. Nonan.
Mr. Napal is not personally liable for any portion of the expenses.
EVIDENCE AND ANALYSIS:
TD Home and Auto (formerly Liberty Mutual) has submitted a bill of costs totalling $6,723.58, including disbursements and GST. The bill includes 55 hours of counsel time at $90 per hour and 18 hours of student/clerk time at $30 per hour. The insurer has already been paid $1,000 in expenses ordered by another arbitrator as a result of the late adjournment of the November, 2004 dates for the preliminary issues hearing, and agrees that this should be deducted from the bill.
I find the disbursements listed - photocopying, witness fees and court reporter - totalling $849.28 with GST - to be reasonable.
I find the counsel time of 55 hours to be somewhat excessive, given that the hearing that counsel had to prepare for was a two-day preliminary issues hearing. In my view, 40 hours is more reasonable. In addition, the rate of $90 claimed is incorrect. The maximum hourly rate payable to counsel is established by Rule 78 of the Dispute Resolution Practice Code, which incorporates the rates in the Legal Aid Services Act, 1998. Counsel for the insurer was called to the bar in 2002, and the appropriate hourly rate under the Legal Aid Services Act is therefore $73.87. The amount claimed in the bill of costs for student/clerk appears reasonable.
Subsections 282 (11.2) and (11.3) of the Insurance Act allow for expenses to be awarded personally against a lawyer where a frivolous or vexatious claim was being advanced, or where the lawyer "caused expenses to be incurred without reasonable cause or to be wasted by unreasonable delay or other default." While Mr. Napal's failure to appear at the April 26 hearing was, in my view, not the proper course of action for a lawyer who was counsel of record, I do not believe he caused unnecessary expenses or delays, nor is there any indication that he was advancing a frivolous or vexatious claim. The cause of the unnecessary expenses and delays was Mr. Napal's client and that is who should pay the expenses.
For the reasons above, I order Mr. Nonan to pay the following expenses of TD:
Counsel fee - 40 hours @ $73.87 $2,954.80
Student/clerk - 18 hours @ $30.00 $ 540.00
Disbursements $ 793.72
Subtotal $4,288.52
GST $ 300.20
TOTAL $4,588.72
Less $1,000 already paid $1,000.00
TOTAL EXPENSES $3,588.72
August 10, 2005
Lorne Slotnick Arbitrator
Date
Financial Services Commission of Ontario
Commission des services financiers de l’Ontario
Neutral Citation: 2005 ONFSCDRS 110
FSCO A03-001543
BETWEEN:
HERMINIGILDO G. NONAN Applicant
and
TD HOME AND AUTO 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:
- Mr. Nonan shall pay expenses of $3,588.72 to TD Home and Auto Insurance Company.
August 10, 2005
Lorne Slotnick Arbitrator
Date
Footnotes
- The Statutory Accident Benefits Schedule —Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.