Financial Services Commission of Ontario
Neutral Citation: 2007 ONFSCDRS 172 FSCO A05-000286
BETWEEN:
ADRIAN WILSON Applicant
and
LOMBARD GENERAL INSURANCE COMPANY OF CANADA Insurer
DECISION ON EXPENSES
Before: Rosemary Muzzi Heard: Bill of Costs received on May 9, 2007 and a Telephone conference call on May 15, 2007. Appearances: Neil Sacks for Mr. Wilson Pamela M. Stevens for Lombard General Insurance Company of Canada
Issues:
The Applicant, Adrian Wilson, was injured in a motor vehicle accident on November 24, 1994. In a decision dated September 29, 2006, I dealt with a preliminary issue with respect to Mr. Wilson’s claims for statutory accident benefits under the Schedule.1 I determined that Lombard was precluded from disputing Mr. Wilson’s qualification for Education Disability Benefits (EDBs) and must deliver a Loss of Earning Capacity Benefits (LECBs) offer to him forthwith. I made no decision on the issue of expenses. The parties were unable to settle the issue of expenses.
As a result, the issue in this further hearing is:
- Is Mr. Wilson entitled to his expenses incurred in respect of this arbitration hearing?
Result:
- Mr. Wilson is entitiled to his expenses fixed in the amount of $6,887.08 and to be paid forthwith.
EVIDENCE AND ANALYSIS:
In awarding expenses, an arbitrator is to consider the criteria enumerated in section 12(2) of O. Reg. 664, which are:
- Each party’s degree of success in the outcome of the proceeding.
- Any written offers to settle made in accordance with subsection (3).
- Whether novel issues are raised in the proceeding.
- The conduct of a party or a party’s representative that tended to prolong, obstruct or hinder the proceeding, including a failure to comply with undertakings and orders.
- Whether any aspect of the proceeding was improper, vexatious or unnecessary.
There is no real dispute between the parties about Mr. Wilson’s entitlement to his expenses of the proceeding as the outcome was completely in Mr. Wilson’s favour. Instead, the issue is one of quantum. As explained by Mr. Sacks, the dispute with respect to expenses derives from the parties’ decision at the last minute, one week before the arbitration dates, to proceed with a short preliminary issue hearing rather than the five-day full-blown hearing on the merits that had been scheduled. However, the parties had prepared themselves already for the full hearing. In fact, Lombard had served an insurer’s examination report one month before the arbitration dates and the parties had contemplated arbitrating all of the relevant issues.
Consequently, Mr. Sacks has submitted a Bill of Costs for fees and disbursements totalling $16,914.37. The “fees” portion of the bill is $15,676.40 and accounts for the work of three lawyers and one law clerk who worked a combined 127.2 hours on the case. Mr. Sacks argues that it was difficult and challenging to work through the case law and arbitration law on a complex issue. Further, he was required to put in a fair amount of time to prepare an evidentiary case, to prepare the expert evidence regarding causation, and to prepare the expert witnesses and the lay witnesses to give testimony.
In terms of the expenses criteria, Mr. Sacks argues that the importance of the issues was very high. There was a lot at stake financially for Mr. Wilson’s family and the present value of the weekly benefit is very high. Further, the parties were able to avoid a full-blown arbitration hearing to resolve the issues.
On behalf of Lombard, Ms. Stevens argues that it would be inappropriate to award expenses as though a full hearing on the issues had been conducted. The actual preliminary issue hearing took no more than four hours, rather than the five days that had originally been set. She conceded that because of complexity of the issues, expenses should not be awarded at the low end of the scale but reiterated that to treat the matter like a full hearing would be going to the very far end of the scale for expenses. She suggested that perhaps taking a percentage of the total expenses submitted would be more appropriate in the circumstances.
I agree that this case involved complex issues that would have required a fair amount of preparation on the part of both parties but especially on the part of Mr. Wilson whose case it was to prove. Even though the preliminary issue hearing was concluded within one-half day, I note from the file before me that the parties had anticipated that it might take as long as two days and in fact had reserved both March 29 and 30, 2006 for the preliminary issue hearing. This fact also speaks to the amount of time that was likely required to prepare the case for arbitration. I am satisfied therefore that a good portion of the hours spent on preparing for the hearing on the merits would have been required simply to address the preliminary issue given the nature of the issue and its significance for Mr. Wilson. Therefore, I find Ms. Stevens’s suggestion of taking a percentage of the fees claimed as appropriate in the circumstances. I conclude that it would be appropriate to reduce the total fees claimed by 50% to reflect that change from an anticipated five-day hearing to a two-day hearing.
I accept Mr. Sacks' estimate of the total number of hours worked by the lawyers and law clerk in preparing for the anticipated five-day hearing on the merits. However, as suggested by Ms. Stevens and accepted by Mr. Sacks, the hourly rate for Brad Moscato should not exceed $75. Therefore, I have reduced the total amount claimed for the work of Brad Moscato by half to reflect this rate change. The total fees claimed then should read $12,473.90. Fifty percent of the new total fees is $6,236.95. The addition of 6% G.S.T. brings the total fees awarded to $6,611.17. Further, I have reduced the total disbursements to $175.91 to account for the removal of claims for parking and mileage. I have left all other amounts as they are.
Therefore, the total expenses owing to Mr. Wilson are $6,887.08.
September 7, 2007
Rosemary Muzzi Arbitrator
Financial Services Commission of Ontario
Neutral Citation: 2007 ONFSCDRS 172 FSCO A05-000286
BETWEEN:
ADRIAN WILSON Applicant
and
LOMBARD GENERAL INSURANCE COMPANY OF CANADA Insurer
ARBITRATION ORDER
Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
- Lombard shall pay Mr. Wilson his expenses in the total amount of $6,887.08 forthwith.
September 7, 2007
Rosemary Muzzi Arbitrator
Footnotes
- The Statutory Accident Benefits Schedule — Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended