Neutral Citation: 2006 ONFSCDRS 33

FSCO A04-000851

BETWEEN:

JELLO JAY HINDS

Applicant

and

GUARANTEE COMPANY OF NORTH AMERICA

Insurer

DECISION ON A PRELIMINARY ISSUE

Before: Anne Sone

Heard: By telephone conference calls on November 4 and 25, 2005. Written submissions were received on November 14, 2005.

Appearances: Ms. Hinds representing herself Janna Balaban for Guarantee Company of North America

Issues:

The Applicant, Jello Jay Hinds, was injured in a motor vehicle accident on November 23, 2002. She applied for and received statutory accident benefits from Guarantee Company of North America ("Guarantee"), payable under the Schedule.¹ Guarantee terminated weekly income replacement benefits on September 16, 2003. The parties were unable to resolve their disputes through mediation, and Ms. Hinds applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The preliminary issues are:

Should Ms. Hinds' proceeding be dismissed without a hearing as it is frivolous, vexatious and commenced in bad faith, pursuant to Rule 68.1 of the Dispute Resolution Practice Code, (Fourth Edition, Updated October 2003) (the "Code")?
Is Guarantee entitled to the expenses it has incurred in this preliminary issue hearing pursuant to Rule 34 (a) of the Code?

Result:

The proceeding is not dismissed.
Guarantee is entitled to its expenses fixed in the amount of $300 incurred in this preliminary issue hearing, inclusive of GST and PST. These expenses are not payable until the resolution of the main hearing in this matter and may be set off against any amount that Guarantee is ordered to pay Ms. Hinds.

ANALYSIS:

Ms. Hinds states that her accident occurred on November 23, 2002 while she was exiting a Mississauga transit bus. She says that she slipped off the top step at the front door of the vehicle, slid down three steps and landed on the pavement. She claims that she sprained her neck, right shoulder, back and right foot, and that she has suffered pain in these areas, as well as headaches and depression. She received treatment including injections, and has had an MRI. She made claims for income replacement, medical, attendant care and housekeeping benefits, which Guarantee disputed.

The parties attended a Mediation on March 8, 2004. None of the outstanding issues were resolved. Guarantee submits that it asked Ms. Hinds at that time to provide further documents to support her claims.

Ms. Hinds filed an Application for Arbitration on April 21, 2004. Prior to and during a pre-hearing held on October 19, 2004, Guarantee again asked Ms. Hinds to provide various documents. Guarantee sent a letter dated January 24, 2005 once again requesting specific documents. Mr. Sherman, Ms. Hinds' then representative, was unable to contact Ms. Hinds. At a resumption of pre-hearing by telephone on March 11, 2005, Arbitrator Lee permitted Mr. Sherman to withdraw as Ms. Hinds' representative. On that date, Ms. Hinds could not be reached by telephone. Arbitrator Lee also adjourned the hearing without setting a new date, and scheduled a resumption of the pre-hearing for June 27, 2005. In addition, he advised Ms. Hinds in writing to retain new counsel or representation, or be prepared to act on her own behalf.

On March 14, 2005, the Commission sent Ms. Hinds a Notice of the Pre-Hearing Resumption rescheduled for June 27, 2005 at the Commission.

Guarantee sent a letter dated May 3, 2005 advising that there were still outstanding productions in relation to this file.

On June 27, 2005, Ms. Hinds did not attend the resumption of pre-hearing I conducted, and was not available by telephone at the number she provided to the Commission.

In a letter dated July 28, 2005, I set out what had previously happened in this matter. I also advised Ms. Hinds of the Commission's expectations regarding productions for an arbitration proceeding pursuant to Rules 32 to 34 in the Code, and the remedies that may be sought for failure to comply. In my letter, I advised Ms. Hinds of the further rescheduled pre-hearing date and of the potential consequences should she fail to attend, as follows:

Please advise the Commission immediately if you are not available for this resumption of pre-hearing by telephone. Should you fail to be available for the resumption on November 5, 2005, at 10:00 a.m., by telephone conference call, I may dismiss your proceeding without a hearing if I find that the proceeding is frivolous, vexatious or is commenced in bad faith, pursuant to Rule 68.1 of the Code.

To assist Ms. Hinds, I also set out the full text of Rule 68.1 pertaining to the Dismissal of a Proceeding Without a Hearing.

On August 9, 2005, the Commission sent Ms. Hinds a formal Notice of Resumption of Pre-Hearing Discussion stating that the pre-hearing would be resumed on November 4, 2005, at 10:00 a.m., by teleconference.

On Friday, November 4, 2005, Ms. Hinds was not available by telephone, and her answering machine was not turned on. Guarantee made submissions requesting that this proceeding be dismissed without a hearing, orally and in writing in a letter dated November 14, 2005.

In the meantime, Ms. Hinds left a voice mail message with the case administrator at the Commission on Friday, November 4, 2005, and spoke to her on Monday, November 7, 2005. Ms. Hinds advised that she had travelled to the Commission on Friday, November 4, 2005, in error, and thus was not available for the teleconference call.

Under these circumstances, I agreed to resume the pre-hearing on November 25, 2005. The Commission sent Ms. Hinds a formal Notice of Pre-Hearing Discussion dated November 14, 2005 advising her of this resumption.

On November 25, 2005, at a teleconference call organized by the Commission, Ms. Hinds explained the circumstances of her failure to be available by telephone on November 4, 2005. She also confirmed that although she is unrepresented, she still wishes to pursue her claims for statutory accident benefits.

Guarantee expressed concerns about the challenges in contacting Ms. Hinds, and the difficulties it has had in obtaining the documents it needs to properly assess the case and prepare for a hearing.

To address these concerns, Ms. Hinds agreed to sign authorizations to allow the Insurer to obtain the productions it has requested. In addition, she confirmed that she will keep her answering machine turned on.

Law:

Guarantee submits that Ms. Hinds= proceeding is frivolous, vexatious and commenced in bad faith. It requests that her proceeding be dismissed without a hearing pursuant to Rule 68.1 of the Code.

Rule 68.1 of the Code pertains to the dismissal of a proceeding without a hearing. It states as follows:

68.1 Subject to Rule 68.2, an adjudicator may dismiss a proceeding without a hearing where the proceeding is frivolous, vexatious or is commenced in bad faith.

68.2 Before dismissing a proceeding under this Rule, an adjudicator shall deliver written notice to all parties of the intention to dismiss the proceeding on the grounds set out in Rule 68.1.

68.3 Where a party objects to a dismissal of the proceeding pursuant to Rule 68.1 or seeks to make written submissions with respect to the dismissal, the party must:

(a) provide the grounds upon which the party objects to the dismissal of the proceeding, or set out any other issues or concerns, in writing; and

(b) serve the material upon the other parties and file it within 20 days of the date of the notice provided under Rule 68.2.

68.4 An adjudicator will consider any written objections or submissions received and may make an order on such terms as he or she considers just.

Pursuant to Rule 68 of the Code, I have the authority to dismiss a proceeding if I find that it is frivolous, vexatious or is commenced in bad faith.

Guarantee's Submissions:

Ms. Hinds, despite notice and repeated opportunities to respond, failed to do so until November 4, 2005. Her representative was permitted to withdraw from the case. It appeared that she had abandoned her claim. However, Rule 68 requires more than abandonment. It also states "an adjudicator may dismiss a proceeding without a hearing where the proceeding is frivolous, vexatious or is commenced in bad faith."

Guarantee argues that Ms. Hinds' proceeding is frivolous, vexatious and was commenced in bad faith since Ms. Hinds has not provided it with any additional information since the date of the Mediation. Further, Ms. Hinds' representative was forced to withdraw for lack of communication with her. She also failed to attend or be available for a number of pre-hearing resumptions.

In my pre-hearing letter dated October 19, 2004, I recorded that the parties undertook to comply with the undertakings given (or provide proof of best efforts to comply, in the case of documents not in a party's possession, control, or power) within 60 days of the pre-hearing date.

Mr. Sherman, Ms. Hinds’ then representative, made these undertakings, and I find that Ms. Hinds is bound by these agreements.

Rule 32.2 of the Code states that the parties have an ongoing responsibility to ensure prompt and complete exchange of documents that are reasonably necessary to determine the issues being arbitrated, including updates to the information previously exchanged and any additional documents obtained.

Guarantee submits that Ms. Hinds has failed to comply with any of the undertakings given at the pre-hearing in a timely manner and is therefore contravening Rule 32.

Rule 34 provides that where a party fails to produce documents in compliance with an order or agreement, an arbitrator may:

(a) order a party to pay expenses (including interim expenses), or deny expenses to a party;

(e) make such other order as the arbitrator considers just.

Guarantee argues that given the circumstances of this matter, a dismissal of the proceedings is just.

Conclusion:

Despite Ms. Hinds’ failure to attend or be available for pre-hearing discussions on a number of occasions, she did call after the November 4, 2005 resumption of pre-hearing and was available to provide an explanation of her conduct by telephone at the November 25, 2005 resumption of pre-hearing. She has also undertaken to leave her answering machine on, so that she is more accessible to Guarantee and the Commission.

I acknowledge that Ms. Hinds has not complied with her undertakings concerning production of documents. However, she has agreed to sign all authorizations that the Insurer provided to her so that Guarantee can obtain all the productions it needs to evaluate her case and prepare for the hearing.

Guarantee did not argue that Ms. Hinds' claims for statutory accident benefits are without merit. Rather, it is concerned about Ms. Hinds' failure to comply with undertakings and attend at pre-hearing resumptions. This has now been addressed by Ms. Hinds' agreement to sign the authorizations that Guarantee requires.

In view of these circumstances, I am not persuaded that Ms. Hinds' proceeding is frivolous, vexatious or commenced in bad faith. Accordingly, I am not prepared to dismiss it without a hearing. After consulting both parties, I have set hearing dates of July 17, 18, 19 and 20, 2006, at 10:00 a.m., at the offices of the Financial Services Commission of Ontario. This office will send a formal Notice of Hearing confirming the details.

EXPENSES:

Guarantee sought its expenses in this preliminary issue hearing. It submits that it has incurred much unnecessary expense in this proceeding. I agree. Due to Ms. Hinds' failure to make herself available to her legal representative and for pre-hearings, Guarantee has been put to unnecessary expense and delay. In addition, Ms. Hinds has not complied with her undertakings as required by Rule 32 of the Code, set out above.

I exercise my discretion under Rule 34 (a) of the Code to award Guarantee its expenses fixed in the amount of $300, including GST and PST, incurred in this preliminary issue hearing. I also order that these expenses are not payable until the resolution of the main hearing in this proceeding, and that they may be set off against any amount that Guarantee may be ordered to pay Ms. Hinds. This award of expenses only pertains to the preliminary issue hearing itself, and does not fetter the discretion of the hearing arbitrator to make an order regarding other expenses in this proceeding.

February 27, 2006

Anne Sone Arbitrator

Date

Financial Services Commission of Ontario

Commission des services financiers de l’Ontario