Wanda Lukas v. York Fire & Casualty Insurance Company, 2008 ONFSCDRS 135

Financial Services Commission des

Commission services financiers

of Ontario de l’Ontario

Neutral Citation: 2008 ONFSCDRS 135

FSCO A07-000651

BETWEEN:

WANDA LUKAS

Applicant

and

YORK FIRE & CASUALTY INSURANCE COMPANY

Insurer

DECISION ON A MOTION

Before: David Muir

Heard: By telephone conference call on May 17, 2008.

Appearances: Mrs. Lukas represented herself

Jamie Pollack for York Fire & Casualty Insurance Company

Issues:

The Applicant, Wanda Lukas, was injured in a motor vehicle accident on November 22, 2005. She applied for and received statutory accident benefits from York Fire & Casualty Insurance Company (“York”), payable under the Schedule.¹ The parties were unable to resolve their disputes through mediation, and Mrs. Lukas applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The issues in this hearing are:

Should Mrs. Lukas be entitled to withdraw this arbitration?
If Mrs. Lukas is permitted to withdraw, what if any terms should be imposed?

Result:

Mrs. Lukas is permitted to withdraw her arbitration and the Commission’s file is closed forthwith.
Mrs. Lukas shall pay $3,000 to York only in the event that she commences a subsequent arbitration in respect of the issues in dispute in the instant matter.
Mrs. Lukas shall pay to York its reasonable expenses of the arbitration in the amount of $1,200.

EVIDENCE AND ANALYSIS:

Ms. Lukas seeks to withdraw the instant arbitration. York in response sought a dismissal of the arbitration without expenses; otherwise it sought its expenses for time thrown away in this matter as a condition of the withdrawal.

A brief description of the unfolding of this arbitration is set out here.

The pre-hearing was held in June 2007. At that time Mrs. Lukas was represented by counsel. The usual issues were discussed and hearing dates in January 2008 were agreed to. In late November 2007, the Commission received a letter from her then representative indicating that Mrs. Lukas no longer wished to be represented by that person. A further letter dated December 21, 2007 from the representative included a handwritten note from Mrs. Lukas indicating that she had accepted her representative’s “resignation”. A further letter to the Commission from Mrs. Lukas dated January 3, 2007 (sic)² confirms that she had accepted her representative’s resignation as well:

I will not be having a lawyer represent me. I will be accompanied by an agent (with witnesses) who may be given my power of attorney to speak to the matter.

The arbitration hearing commenced as scheduled on January 14, 2008. What transpired that day was set out in my letter of January 17, 2008:

This matter came on for hearing on January 14, 2008 at the Offices of the Financial Services Commission of Ontario. Mrs. Lukas represented herself, at least at the outset. Mr. Pollack represented York Fire & Casualty Insurance Company, (“York Fire”).

After some brief opening discussion, Mrs. Lukas requested that the matter be adjourned in order that other issues might be added to the arbitration. After some further discussion it was apparent that of the several potential issues Mrs. Lukas was raising only one, a disputed treatment plan, could be added to this proceeding.

In any event York Fire opposed the adjournment request, citing the Dispute Resolution Practice Code (Fourth Edition — Updated October 2003) and Practice Note #9.

Despite York Fire’s not unreasonable concerns respecting the adjournment request it was granted. Mrs. Lukas, who had been represented until late December when the Commission acknowledged counsel’s withdrawal, was manifestly unprepared to proceed with the arbitration and, as indicated, wished to raise other issues in this proceeding rather than having to commence a second arbitration. As I indicated to the parties at the hearing, what ought to have happened when Mrs. Lukas indicated that she was representing herself, was a resumption of the pre-hearing where these issues could have been thrashed out. I also noted that contrary to normal Commission practice, the parties were not contacted for settlement discussion prior to the arbitration hearing where some of these issues might have been canvassed as well.

The adjournment was granted to May 5, 6 and 7, 2008 at 10:00 a.m. at the offices of the Financial Services Commission of Ontario, on the following terms:

The agreed dates are peremptory to Mrs. Lukas. No further adjournments will be granted her, except in extreme and unforeseeable circumstances.

The agreed dates were set on the understanding that if another matter to which Mr. Pollack is committed goes ahead, this matter will be adjourned to mutually convenient dates.

Interest on any amounts found to be owing to Mrs. Lukas is suspended from January 14, 2008 to the first date of the adjourned hearing, May 5, 2008.
Mrs. Lukas shall confirm in writing whether or not she will be represented at the hearing in May. It was suggested that Mr. Zenon Chichon, Mrs. Lukas’ brother may represent her in the hearing. Mr. Chichon indicated that he might have a monetary interest in the outcome and agreed to provide certain documents he referred to in this regard. This material should be provided to York Fire forthwith. If there is an issue regarding Mr. Chichon’s ability to represent Mrs. Lukas, this issue should be dealt with prior to the resumption of the hearing.

In the event that Mrs. Lukas retains other representation, that individual should be in contact with York Fire forthwith.

No new documentary evidence will be submitted for admission in the hearing, subject to the following exceptions:

a. The clinical notes and records of Xiaoping Jin, a treating physiotherapist. These documents shall be provided to York Fire as soon as possible, at the absolute latest 30 days prior to the arbitration hearing.

b. Any report or summary of evidence to be provided by either of the two experts identified in the pre-hearing letter of June 21, 2007 shall be delivered to York Fire as soon as possible, at the absolute latest 30 days prior to the arbitration hearing.

c. Any documents related to the housekeeping claim from January 29, 2006 to be provided forthwith.

York Fire sought its expenses thrown away as a consequence of the late adjournment request. I directed that the Insurer set out its position in writing including a quantification of its costs thrown away. Upon receipt, Mrs. Lukas will have 10 days to respond. I will release my determination in due course.

It was agreed that the issues in dispute are those set out in the pre-hearing letter of June 21 2007 with the addition of a disputed treatment plan dated January 11, 2007, for physiotherapy to be provided by Xiaoping Jin.

Mrs. Lukas indicated that, in addition to the witnesses identified in the June 21, 2007 pre-hearing letter, she may call Xiaoping Jin to give evidence.

Subsequent to my letter, submissions were received from York with respect to expenses as described in paragraph 5 above. Mrs. Lukas did not respond to these submissions. No order was made in this regard as events overtook my determination of that issue.

On March 31, 2008 Mrs. Lukas wrote to York Fire and indicated that she did not wish to proceed with the arbitration. At my direction the Case Administrator contacted Mrs. Lukas and sought clarification of her position. In particular Mrs. Lukas was asked if she was seeking leave to withdraw and she confirmed that she was. By letter dated April 11, 2008 York advised as noted above that if Mrs. Lukas consented to a dismissal of the arbitration it would not seek any of its expenses but if Mrs. Lukas did not agree then York would seek expenses as a condition of its consent to the withdrawal. Mrs. Lukas has not consented to a dismissal of the arbitration and has on several occasions indicated that she may be pursuing her benefits in other proceedings although she has been unable to provide any details of what these proceedings might be or where even they might have been commenced.

Accordingly the question became whether or not Mrs. Lukas ought to be allowed to withdraw her arbitration and if so on what terms. Written submissions were received from the parties.

York did not object, as such, to Mrs. Lukas withdrawing the arbitration, but submitted that she had unnecessarily prolonged the proceeding and as a consequence it was entitled to its expenses in defending it. York also sought an Order that Mrs. Lukas be required to pay $3,000 in the event that she seeks to recommence an arbitration proceeding.

Mrs. Lukas did not respond directly to York’s submissions. Rather she advised that she retained the right to proceed with an action, but that if she did, it would be on the “private side”.

Mrs. Lukas has offered no reason for her withdrawal although she has suggested on more than one occasion that she “wants nothing from York Fire”. Despite this assertion Mrs. Lukas has continued to assert that she might have already begun another proceeding against York.

Mrs. Lukas is entitled to withdraw the arbitration proceeding on consent and on the basis that she is seeking nothing from York Fire.

I have no hesitation in finding that York Fire is entitled to an Order that Mrs. Lukas shall pay $3,000 to York Fire only in the event that she commences a new arbitration in respect of the issues in dispute in the instant matter. I make this Order recognizing the Dispute Resolution Practice Code (4th ed.) no longer provides explicit authority for it.³ However such an Order mitigates the effects of what might be characterized as an abuse of process where a party withdraws arbitration without coherent explanation only to begin a substantially similar arbitration after a period of time.

It is not clear that this is Mrs. Lukas’ intention although the lack of clarity surrounding her reasons for withdrawal as well as the repeated vague assertions about another proceeding at least raise the possibility of further proceedings. In any case York Fire has been assessed a fee in the amount of $3,000 for the instant arbitration. I see no reason why it should be required to pay twice for the privilege if Mrs. Lukas has another change of heart and decides to commence another arbitration.

EXPENSES:

As regards the claim for expenses I find that York Fire is also entitled to some part of its expenses. The factors that I am required to consider in assessing expenses are set out in Regulation 664. These are the only factors that I am entitled to consider. They are not an easy fit when applying them to these circumstances.

For example when considering the outcome of the arbitration, it might be argued that York Fire has been completely successful in that the arbitration has concluded with no findings against it. On the other hand what has happened here might also be characterized as the ending of the arbitration without the Insurer ever being called upon to defend its decisions. To my mind the result here is equivocal. I am not prepared to draw the inference that the withdrawal is a consequence of an informed determination on Mrs. Lukas’ part that she could not succeed at arbitration. Nor am I prepared to find that the arbitration was commenced in bad faith and was or is frivolous or vexatious. The other factors are not particularly applicable although I do find that Mrs. Lukas has prolonged the proceeding to no effect and ultimately has withdrawn her arbitration without much in the way of explanation.

I do not think in these circumstances that York Fire is entitled to be indemnified for all of its allowable expenses. I say that, while also noting at the same time that the Bill of Costs is commendably modest. However, the fact is that this proceeding has been brought to an end, and the Insurer’s expenses limited as a consequence and without having to defend its decision. I have also considered in this regard that I have made an Order that Mrs. Lukas will be required to indemnify York Fire in the event that she commences arbitration in respect of the same issues, thereby insulating the Insurer from the consequences of that turn of events. I find therefore that York Fire is entitled to be paid its expenses in the amount of $1,200 representing 50% of its allowable expenses.

August 12, 2008

David Muir

Arbitrator

Date