Neutral Citation: 2005 ONFSCDRS 34
FSCO A01-001278
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
VIDA TENKORANG
Applicant
and
WAWANESA MUTUAL INSURANCE COMPANY
Insurer
DECISION ON EXPENSES
Before:
Susan Sapin
Heard:
July 23, 2004, at the Offices of the Financial Services Commission of Ontario in Toronto.
Appearances:
Ian A. Little for Ms. Tenkorang
Darrell March for Wawanesa Mutual Insurance Company
Issues:
The Applicant, Vida Tenkorang, was injured in a motor vehicle accident on April 18, 2001. In an arbitration hearing that took place on December 9, 10 and 11, 2002, Arbitrator Skinner dealt with Ms. Tenkorang's claims for statutory accident benefits under the Schedule.1 In a decision dated March 6, 2003, the arbitrator awarded Ms. Tenkorang 70 per cent of her arbitration expenses. Wawanesa refused to honour the account for arbitration expenses of $6,038.61 presented to it on behalf of Ms. Tenkorang, on the basis that it was excessive, and Ms. Tenkorang requested a hearing before an arbitrator to assess the amount of expenses that Wawanesa should pay. As Arbitrator Skinner had by then left the Commission, I was appointed to determine the amount of expenses to be paid.
Result:
- Ms. Tenkorang is awarded her expenses in the total amount of $4,840, plus GST.
REASONS:
The jurisprudence on arbitration expenses is well known to the parties and not disputed, and I do not need to restate the general principles here, except perhaps to reiterate that the overall consideration is what is reasonable, based on a global, rather than on a line-by-line, assessment.
The parties agree that the arbitration hearing was relatively uncomplicated; however, Wawanesa's dockets indicate that the hearing took about 16 hours to complete; whereas Ms. Tenkorang calculates it at 20 hours. She claims preparation time of 30 hours, for a ratio of preparation time to hearing time of 1.5 : 1. She claims the maximum hourly rate of $150 allowed for senior counsel under the Legal Aid Services Act, in accordance with Rule 78 of the Dispute Resolution Practice Code (Fourth Edition, updated October, 2003). She claims $221.49 for the expenses of a law clerk (9 hours at the legal aid rate of $23 per hour).
Ms. Tenkorang seeks a total of $6,038.61, which represents 70 per cent of her combined legal expenses and disbursements of $8,278.59 and $631.50. She further claims her expenses of this assessment hearing (2-3 hours at $150).
Wawanesa argued that a reasonable amount for expenses would be $2,500 in this case, on the basis that the Applicant had very little chance of success and the arbitration hearing should not have taken place at all. Counsel for Wawanesa submitted that Ms. Tenkorang's counsel did very little to prepare for the hearing, citing the filing of the Applicant's arbitration brief the day of the hearing as an example. He also argued that I should take into account the fact that Ms. Tenkorang rejected a generous settlement offer from Wawanesa prior to the hearing.
Unfortunately, Wawanesa's Offer to Settle did not comply with the Settlement Regulation, in that it was an offer for a full and final settlement of the insured's claims, and was not confined to the issues in dispute in the arbitration proceeding. Only the latter type of offer will be considered by an arbitrator in awarding arbitration expenses. While I sympathise with counsel's frustration at feeling forced into a "hearing that should never have happened," Wawanesa could have protected itself from some of the consequences of an award of expenses against it by presenting an Offer to Settle that complied with the Regulation.
Given the circumstances of this case, I find a ratio of preparation time to hearing of 1 : 1 to be reasonable, and no compelling reason not to award the senior counsel rate of $150. As Arbitrator Skinner already discounted Ms. Tenkorang's arbitration expenses by 30 per cent to account for the four hours of hearing time required by Wawanesa to review her late-filed arbitration brief, I find Wawanesa should only be expected to pay legal fees based on hearing time of 16 hours, and corresponding preparation time of 16 hours - four hours of which should be for preparation time put in by Mr. Little's law clerk.
This amounts to legal fees for counsel of 28 hours at $150 per hour, and legal fees for a law clerk of 4 hours at $23 per hour - for a total of $4,292 for legal fees.
Regarding claimed disbursements of $631.50, I find Mr. Little's account contains an addition error, and the correct amount is $348.
Ms. Tenkorang is entitled to legal expenses of $200 for this proceeding, which would not have been necessary had counsel on both sides chosen to behave professionally and not approach so small a dispute in so adversarial a manner.
I find Ms. Tenkorang is entitled to total expenses of $4,840, plus GST.
March 17, 2005
Susan Sapin
Arbitrator
Date
Neutral Citation: 2005 ONFSCDRS 34
FSCO A01-001278
FINANCIAL SERVICES COMMISSION OF ONTARIO
BETWEEN:
VIDA TENKORANG
Applicant
and
WAWANESA MUTUAL 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:
- Wawanesa Mutual Insurance Company shall pay to Ms. Tenkorang her arbitration expenses of $4,840, plus GST.
March 17, 2005
Susan Sapin
Arbitrator
Date
Footnotes
- The Statutory Accident Benefits Schedule —Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.