Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2008 ONFSCDRS 191

Appeal P07-00024

OFFICE OF THE DIRECTOR OF ARBITRATIONS

ALLSTATE INSURANCE COMPANY OF CANADA

Appellant

and

N.I.

Respondent

BEFORE:

Delegate Lawrence Blackman

REPRESENTATIVES:

Mr. Todd J. McCarthy for Allstate Insurance Company of Canada

Mr. David S. Wilson for N.I.

HEARING DATE:

October 7, 2008

Additional written submissions were to be received by November 14, 2008

APPEAL ORDER

Under section 283 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:

The Arbitrator’s order dated June 26, 2007 is confirmed and the appeal is dismissed.
If the parties are unable to agree on the legal expenses of this appeal proceeding, an expense hearing may be arranged in accordance with Rule 79 of the Dispute Resolution Practice Code (Fourth Edition, Updated – October 2003).
The question of the legal expenses of the arbitration proceeding is referred to the Arbitrator.

December 2, 2008

Lawrence Blackman Director’s Delegate

Date

REASONS FOR DECISION

I. NATURE OF THE APPEAL

The Respondent, N.I., was injured in a motor vehicle accident on April 8, 2002. An eight-day arbitration hearing was held before Arbitrator Leitch (the “Arbitrator”) regarding the Respondent’s entitlement to specific statutory accident benefits claimed pursuant to the Schedule¹ from his first party insurer, Allstate Insurance Company of Canada (the “Appellant”).

The Arbitrator’s June 26, 2007 decision held, in part, that the Respondent was entitled to non-earner benefits (“NEBs”) from October 8 to December 5, 2002, with interest thereon from November 6, 2002. This was based, as stated at page 44 of the decision, on the Appellant having:

… conceded that Mr. I met the test of eligibility for NEBs from October 8, 2002, when the 26 week qualifying period expired, to the time of the assessments by Ms. Sagebiel and Dr. Orsini in December 2002. In view of this concession, I find that Mr. I was entitled to NEBs for the 8.3 weeks from October 8, 2002 to December 5, 2002, the date of the in-home assessment by Ms. Sagebiel, plus interest calculated from November 6, 2002.

The Arbitrator further referred to such a concession on page 52 of his decision.

By letter dated July 6, 2007, the Appellant wrote the Commission that its submission at the arbitration hearing had been “that if there was any period when [N.I.] met the test, it would have only been while recuperating following his September, 2002 surgery and until the December 5, 2002 in-home evaluation” (emphasis in the original). While not seeking to change the arbitration decision or order, the Appellant requested “clarification of the misstatement in the decision.”

The Arbitrator, by letter dated July 24, 2007, responded that he could not accede to this request, as his June 26, 2007 decision reflected his understanding of the Appellant’s position.

The Appellant submits that the Arbitrator erred in finding that it conceded the Respondent’s entitlement to NEBs for the period awarded. The Appellant requests, in addition to its expenses of both the arbitration and appeal proceedings, as agreed or assessed, that:

the reasons for the Arbitrator’s decision be amended to reflect that the Appellant did not concede entitlement, regardless of whether that changes the final order;
an order that the Respondent is not entitled to the 8.3 weeks of NEBs awarded from October 8 to December 5, 2002 (being from the end of the initial 26-week qualifying period which followed the Respondent’s shoulder surgery to the insurer medical examinations conducted in December 2002) totaling $1,535.50, with interest thereon, and that the Respondent’s claim be dismissed in its entirety;
the issue of NEB entitlement for the specific 8.3 week period be remitted to either the same arbitrator or a different arbitrator; or,
if necessary, that the entire issue of NEB entitlement be remitted to arbitration.

The Appellant states that the last day of the arbitration hearing, being April 13, 2007, was transcribed by Ms. E. Antonelli of Victory Verbatim Reporting Services. The Appellant submits that there is no doubt from this transcript that it did not make the concession stated by the Arbitrator. Rather, page 47 of the transcript notes then counsel for the Appellant saying:

… if you find [N.I.] is entitled for some period of time to this benefit, it has to start on October 8^th, and I would submit to you that there is that window until the end of December, it is a 12-week span, where he might have met the test because the surgery had further inhibited his ability in his shoulder and it was on the road to improvement, there is clearly evidence about how it did improve, how the improvement plateaus at some point.

Page 63 of the transcript further has counsel for the Appellant saying:

… if you have any doubt, I would submit it be restricted to that period, as I have indicated, from October 8^th, being 26 weeks after the accident, until the December evaluations by Ms. Sagebiel and Dr. Orsini.

Rule 50.1 of the Dispute Resolution Practice Code (Fourth Edition, Updated – October 2003) (the “Code”) provides that a “party to an arbitration may appeal an order of an arbitrator to the Director only on a question of law.” The Appellant cites Delegate Makepeace in Truong and Lumbermens Mutual Casualty Company / Kemper Group, (FSCO P03-00007, March 9, 2004), that “the test for error of law ‘is whether the decision was based on a material finding of fact that was not supported by the evidence such that a reasonable tribunal acting judicially and properly directed in law could not have made the finding in question.’”

The Appellant submits that the only finding of fact that can be characterized as an error of law is one made in the complete absence of supporting evidence, citing in support Lombardi and State Farm Mutual Automobile Insurance Company, (FSCO P01-00022, February 26, 2003) and Kingsway General Insurance Company and Pereira, (FSCO P05-00031, December 20, 2006). In the latter, Delegate Evans stated that:

… errors of law include findings of fact made in the complete absence of supporting evidence, made on the basis of conjecture, or made on the basis of a misapprehension of the evidence caused by a misdirection on a legal principle. Furthermore, inferences can be attacked at two distinct levels: if the appellant can demonstrate the arbitrator made an error of law when he made the findings of fact on which the inference was based, or if the arbitrator made an error of law in the inference- drawing process itself.

The Appellant submits that the only basis for the Arbitrator’s decision to award 8.3 weeks of NEB entitlement was his clear misapprehension that the Appellant had conceded same, the Arbitrator failing to give any evidentiary basis for this finding. As no such concession was made, as evidenced by Ms. Antonelli’s transcript, this finding of entitlement is not sustainable. Hence, the Arbitrator erred in law and his decision in this regard must be rescinded.

The Appellant states that is not unexpected that the Arbitrator subsequently declined to alter his decision as he had a view as to what he thought he heard and believed that he had drawn a correct conclusion. The Appellant concedes that in this appeal, having a transcript of the oral evidence is crucial; without the transcript, there is no way to contradict the Arbitrator and the Appellant is “toast.”

The Appellant submits that if this matter must go back to a new arbitration hearing, the hearing should be limited to the issue of the 8.3 weeks of entitlement awarded. The Appellant argues that there certainly was no entitlement in law prior to October 8, 2002, as that time-frame fell within the initial 26-week waiting period during which payment is not required.

The Respondent submits that the Arbitrator did not err regarding the said concession. In the alternative, the Respondent submits that the Arbitrator was entitled to infer that the Appellant had conceded 8.3 weeks of NEB entitlement. Ms. Antonelli’s transcript has the Appellant’s counsel stating at page 48 that “[g]enerally I would say that he improves to a level that he doesn’t meet the test.” The Respondent argues that one appropriate interpretation of these words is that the Appellant was conceding the Respondent did meet the eligibility test for the 8.3 weeks awarded. A further concession argued by the Respondent, “I strongly submit to you he no longer meets the test,” could not be located in the transcript provided.

In the further alternative, the Respondent submits that the Arbitrator was warranted in awarding the 8.3 weeks of NEBs based on the evidence received during the arbitration hearing as to the Respondent’s medical condition and impairment. For there to be an error of law, the Appellant must show that the tribunal, acting reasonably, could not have come to this decision, that there was no evidence in the entire eight-day hearing to support a finding. As a transcript of the entire proceeding was not ordered, one cannot presume that there was no such evidence before the Arbitrator. Rather, the Arbitrator simply did not set out the supporting evidence.

The Respondent submits that if the matter is remitted to arbitration, it would be inappropriate to refer only the 8.3 week period. Rather, the entire question of NEB entitlement should be reheard.

In my letter of January 18, 2008, in addressing the Appellant’s request for a stay, I noted that subsection 22(3) of the Insurance Act, R.S.O. 1990, c. I.8 states that:

The evidence and proceedings in any matter before a person referred to in subsection (1) [the Director and every arbitrator] may be reported by a stenographer who has taken an oath before the person to report the evidence and proceedings faithfully.

I noted that on the material before me, I was unable to discern whether the Arbitrator had administered the requisite oath to the reporter or reporters. I raised the question as to “the status of the transcript or transcripts which a party may wish me to consider.”

In its letter dated January 24, 2008, the Appellant stated that the stenographers it retained:

… were under a professional and legal obligation to the tribunal and that the

transcripts must be used fairly … While my recollection is that neither stenographer was administered an oath, it is the Appellant’s position that there was no issue or concern raised by the parties or the hearing Arbitrator about the duty and obligation of either stenographer that recorded the hearing. I note the transcript obtained and provided contains (at page 110) the stenographer’s certification that the transcript provided is “true and accurate”. I have also spoken with Joanie Gigante, vice president of Victory Verbatim Reporting Services and have been advised that the recording from which the transcript has been prepared remains available.

By letter dated February 4, 2008, the Respondent stated that the provisions of subsection 22(3) of the Insurance Act have “somehow been regularly ignored or overlooked by Arbitrators. Accordingly, the insured accepts that the status of the transcripts in this matter should not be affected by the apparent failure of the Arbitrator to administer the oath.”

By reply letter dated February 14, 2008, the Appellant stated that “[r]egarding the failure to administer the oath to the stenographer, the parties appear to be in agreement.”

The Appellant agrees that the parties were given fair notice regarding the issue of the status of the transcripts. It submits that section 22 of the Insurance Act and Rule 74 of the Code do not make the oath mandatory. Rather, Ms. Antonelli’s transcript is the only record of the arbitration hearing, it is the best evidence available and it trumps the Arbitrator.

At the oral appeal hearing, as confirmed by my letter dated October 8, 2008, I allowed the parties an opportunity to provide written submissions regarding the Appellant’s argument raised at the oral hearing, namely:

… the jurisdiction of an appellate officer to raise in this case the question of the status of the transcript provided in light of subsection 22(3) of the Insurance Act, R.S.O. 1990, c. I.8 and Rule 74.1 of the Dispute Resolution Practice Code (Fourth Edition, Updated – October 2003), as initially raised in my letter to counsel (copied to their principals) dated January 18, 2008 and as further addressed in my March 7, 2008 appeal order …

The Appellant submits that an appellate officer may not, in the absence of an objection from a party or an indication that a transcript is flawed or inaccurate, review the manner in which the arbitration was conducted for the purposes of taking oral evidence or receiving documents. An appellate officer’s review is limited to what happened at the arbitration and not what should properly have been done at the arbitration. An appellate officer cannot go behind the transcript and has no jurisdiction to raise this issue, especially when neither party has raised a concern regarding the transcript provided.

The Appellant submits that Rule 1.3 of the Code permits the receiving of the oath or affirmation by the stenographer who has certified the transcript as accurate and that an appellate officer has no jurisdiction not to receive same, given the presumption of the integrity of the record under subsections 34.1(5.1) and (7) of the Evidence Act, R.S.O. 1990, c. E.23.

In the alternative, the transcript should be accepted as fresh evidence, especially given Ms. Antonelli’s affidavit noted below, as it would clearly change the result in this case and would cure a technical breach. The Appellant cites Wawanesa Mutual Insurance Company and Melchiorre, (P07-00014, April 25, 2008) as a case where testimony was considered from a transcript that failed to note the Arbitrator as having administered an oath.

In the further alternative, the Appellant sought leave at the oral appeal hearing to call the stenographer to now be sworn so as to regularize any irregularity. After the conclusion of the oral hearing, the Appellant filed with the Commission, on its own initiative, an affidavit of Ms. Antonelli sworn October 22, 2008 attesting to the accuracy of her transcript and a copy of the tapes prepared on April 13, 2007 and subsequently transcribed.

At the oral appeal hearing, the Respondent submitted that subsection 22(3) of the Insurance Act is mandatory and that the only proper interpretation of the words “may be reported by a stenographer” is that an adjudicator has discretion whether to allow a court stenographer to report the evidence and proceedings. The Respondent states that the Appellant’s subsequent written submissions went well beyond what was allowed and provided only bald assertions regarding jurisdiction. The Appellant submits that there is nothing in section 283 of the Insurance Act that limits the jurisdiction of an appellate officer as argued by the Respondent.

II. ANALYSIS

I agree that a party to an arbitration can appeal an order of an arbitrator only on a question of

law, as set out in Rule 50.1 of the Code and subsection 283(1) of the Insurance Act, and that an error of law includes a finding of fact made in the complete absence of supporting evidence, as stated in Lombardi and Pereira.

Rule 74.1 of the Code mirrors subsection 22(3) of the Insurance Act, and states that:

A hearing may be recorded by a court reporter who has taken an oath or affirmation to report the evidence and proceedings faithfully …

Rule 74.1 further notes that the Commission’s Dispute Resolution Group does not provide reporting services for a hearing. Parties who want a record of the proceeding must make their own arrangements for the attendance of a reporting service and must pay for same.

If the Arbitrator’s finding of 8.3 weeks of NEB entitlement was based solely on the Appellant having conceded same, and the transcript of a stenographer duly sworn by the Arbitrator in accordance with subsection 22(3) of the Insurance Act indicated that no such concession had been made, there would be no question that the June 26, 2007 decision in this regard could not stand.

Rule 56.4 of the Code provides that the appeal record includes “if it is filed, the transcript of the arbitration hearing.” The question then is, what is the “transcript of the arbitration hearing?” The Appellant’s argument, implicitly, is that Ms. Antonelli’s transcript is the transcript of the arbitration hearing, it forms part of the appeal record and, explicitly, any discrepancy between the Arbitrator’s reasons and the transcript certified to be correct by the stenographer must be resolved in favour of the stenographer.

My March 7, 2008 decision herein pertained to the Appellant’s submissions that the Arbitrator’s order be stayed. In addressing the criterion of the substance of the grounds for appeal, I referred to Cortez and Wawanesa Mutual Insurance Company, (FSCO A02-001632, May 4, 2007). In that case I was prepared to swear in the stenographer on the conditions that I, as arbitrator, would have authority over the stenographer and that either party could order a copy of the transcript. Those terms were not acceptable to the party retaining the stenographer. Accordingly, I held that the stenographer was not to be sworn and that his notes formed no part of the record. Rather, his notes were purely the party’s property and purely for its benefit. The notes could be as partial and incomplete as the party felt were appropriate, highlighting whatever aspects of the evidence was helpful to its cause.

I commented in my March 7, 2008 decision herein that:

There is an important purpose behind subsection 22(3) of the Insurance Act and Rule 74 of the Code. While a cost efficient system of court reporting may have been created, the arbitrator's administration of the oath to the stenographer is still mandatory to signify and confirm that the stenographer has ceased to be an employee of any one party and the stenographer's sole responsibility is now to the tribunal as an independent, qualified professional.

I further stated that:

I do not know why the Arbitrator did not administer an oath to the stenographer in this case. There is, however, no indication that either counsel requested that the oath be administered or that there was any unreasonable refusal by the Arbitrator to do so. I am not persuaded that the consent of the parties elevates a stenographer to an official status absent the arbitrator's administration of the oath, the arbitrator having the statutory duty to control the proceedings under the Statutory Powers Procedure Act.

I, therefore, held that in the absence of a transcript from a reporter duly sworn by the hearing arbitrator, any discrepancy between an arbitrator’s reasons and a transcript is not automatically resolved in favour of the latter. The Appellant’s further submissions have not persuaded me otherwise.

Specifically, I find:

For a transcript to form part of the appeal record, and certainly to “trump” an arbitrator, subsection 22(3) of the Insurance Act is mandatory, subject, perhaps, only to exceptional or extraordinary circumstances. The word “may” in the provision provides the Director or the arbitrator with discretion to allow or not allow a stenographer to report the evidence and proceedings in any matter before him or her. A prerequisite is that an oath must be given before the Director or the arbitrator that the stenographer will report the evidence and proceedings faithfully. It is not an onerous obligation and, as set out above, one for which there is a sensible and necessary purpose. It is, in effect, a delegation of specific authority.

That an adjudicative system is pragmatic, flexible and cost efficient does not mean that a lowering of proper standards is sanctioned or that there are no “red lines” of procedure.

As the oath is a prerequisite and must be given by the person before whom the matter is being held, I have no authority as an appellate officer to administer the oath after the hearing. Nor am I persuaded that subsection 22(3) is a mere technicality. Rather, it is an important safeguard for the independence and neutrality of the arbitration system, consistent with subsection 23(1) of the Statutory Powers Procedure Act, R.S.O. 1990, c. S. 22, that a “tribunal may make such orders or give such directions in proceedings before it as it considers proper to prevent abuse of its processes.”

The Honourable Stephen T. Goudge, Commissioner, in his September 30, 2008 Executive Summary of the Inquiry into Pediatric Forensic Pathology in Ontario, stated that a judge “must bear the heavy burden of being the ultimate gatekeeper in protecting the system,” in that case, from unreliable expert evidence. The role of an adjudicator as gatekeeper, in my view, is broader than qualifying and weighing expert evidence.

I am persuaded that an adjudicator may, on fair and reasonable notice, raise an issue pertaining to the integrity of the process. In this case, the issue is what is included in the appeal record under Rule 56.4 of the Code and whether Ms. Antonelli’s transcript is “the transcript of the arbitration hearing.” I am not persuaded that such a determination can be dictated by one or both of the parties, their agreement being tacit or otherwise, any more than parties can bypass the adjudicator to expand the number of experts to be called to give oral testimony or make a finding that the proposed experts are indeed qualified. In any event, to use the Appellant’s argument as to when an appellate officer would have jurisdiction, the transcript presented is indeed flawed, as the stenographer was not sworn.
Rule 1.3 of the Code, relied upon by the Appellant, provides that a “defect in form or other technical breach will not make a proceeding invalid.” The issue here is not whether

the arbitration proceeding is invalid, but rather the status of the transcript proffered.

I am not persuaded that the issue here is one of fresh evidence. In any event, in Budd and

Personal Insurance Company of Canada, (FSCO P99-00032, January 8, 2000) Delegate McMahon accepted the criteria regarding the introduction of fresh evidence as set out in Palmer v. The Queen, [1980] l S.C.R. 759. These principles include that the evidence should generally not be admitted if, by due diligence, it could have been adduced at trial. In this case, there were two very experienced counsel at the arbitration hearing. No evidence whatsoever is provided as to whether a request was made of the Arbitrator to swear in the stenographer, and if a request was not made, why it was not made.

Further, in this appeal the Appellant had more than eight months between the issue being first raised and the appeal hearing to seek leave to introduce what it terms fresh evidence. It is neither fair nor reasonable to allow affidavits and tapes to be simply filed with the adjudicator after the oral appeal hearing without leave, on notice, being first sought.

A further criterion in Palmer is that the evidence must be credible, in the sense that it is reasonably capable of belief. Ms. Antonelli swears in her affidavit sworn October 8, 2008 that same “is made in support of the appeal of the insurer in this matter and not for any other purpose.” A stenographer’s professional and legal obligation is to the tribunal and is to support and enhance the neutrality and independence of the adjudicative process under the authority of the adjudicator; it is not to be beholden to or to provide assistance favouring one party over another.

Self-certification by a stenographer is not sufficient. Contrasting the questionable

status of the stenographer in the absence of being accepted and sworn by the hearing adjudicator, the Arbitrator herein was appointed by the Director pursuant to sections 8 and 282 of the Insurance Act. One of the obligations of the hearing arbitrator is to make a determination regarding a proposed stenographer. Section 5 of the Evidence Act, R.S.O. 1990, c. E.23, as amended, upon which the Appellant relies, states, in part, that:

Recordings and transcripts of evidence

Recording

(1) Despite any Act, regulation or the rules of court, a stenographic reporter, shorthand writer, stenographer or other person who is authorized to record evidence and proceedings in an action in a court or in a proceeding authorized by or under any Act may record the evidence and the proceedings by any form of shorthand or by any device for recording sound of a type approved by the Attorney General.

Admissibility of transcripts

(2) Despite any Act or regulation or the rules of court, a transcript of the whole or a part of any evidence that has or proceedings that have been recorded in accordance with subsection (1) and that has or have been certified in accordance with the Act, regulation or rule of court, if any, applicable thereto and that is otherwise admissible by law is admissible in evidence whether or not the witness or any of the parties to the action or proceeding has approved the method used to record the evidence and the proceedings and whether or not he or she has read or signed the transcript. [emphasis added]

This provision requires the stenographer to have been “authorized.” In this case, the authorization is provided by subsection 22(3) of the Insurance Act. No such authorization exists.

Subsection 34.1(3) of the Evidence Act provides that a court “may” have regard to evidence adduced under that section in applying any common law or statutory rule relating to the admissibility of records. In any event, there is no evidence provided that the circumstances enumerated in subsection 34.1(7) of the Evidence Act which presume the integrity of the electronic records systems, exist. Nor is there any evidence that the stenographer meets the qualifications of subsection 4(2) of Ontario Regulation 158/03, promulgated under the Evidence Act, entitled “Certification of Recordings and Transcripts.”

I do not agree that the transcript proffered is the only record of the arbitration. Rather, there is the Arbitrator’s decision of June 26, 2007.

In Melchiorre, I stated that:

The transcript for the first day of the arbitration hearing, August 14, 2006, notes that the Arbitrator swore in a court reporter, Ms. M. Locke, from Atchison & Denman. On October 5, 2006, the date Ms. Pontieri testified, a different court reporter from Atchison & Denman attended. The transcript provided for that day fails to note the Arbitrator administering the oath to this reporter.

The Appellant ordered the arbitration transcripts for this appeal. It relied upon them in its submissions, including the transcript for October 5, 2006. The Appellant has the onus in this appeal of establishing an error of law. Whatever the precise status of the October 5, 2006 transcript, I find that Ms. Pontieri's examination therein is consistent with the Arbitrator's findings of fact, and negates any argument that there was a complete absence of evidence supporting the Arbitrator’s findings of fact forming the basis for a special award.

In the case now before me, the parties agree that no reporter was ever sworn. In Melchiorre

it was not necessary to determine the status of the transcript as there was no discrepancy between it and the arbitrator’s findings of fact and the transcript submitted failed to support the arguments of the party relying on it. That is not the case here.

The Appellant does not argue, nor is any evidence submitted, that there are extraordinary, or even extenuating, circumstances in this case such that an appellate officer has and should exercise discretion to include the transcript proffered as part of the appeal record, possibly weighing such factors as the possible prejudice to the parties, the prejudice to the integrity of the adjudicative system and the reason or reasons the stenographer was not sworn.

Rather, the whole thrust of the Appellant’s argument is that the stenographer taking an oath is not necessary. To accept this premise is to undermine the role of the arbitrator and the neutrality and independence of the arbitration process. The Appellant was put on early notice of this concern. No evidence is provided as to why the Arbitrator did not swear in the stenographer. No error of law is alleged by the Appellant in this regard. No evidence is presented that the failure to administer the oath was simply an oversight rather than a deliberate decision.

The parties dispute whether the Appellant conceded 8.3 weeks of NEB entitlement. In the absence of the stenographer having been sworn in accordance with subsection 22(3) of the Insurance Act, I am not persuaded that Ms. Antonelli’s transcript takes precedence over the express findings of the Arbitrator. Accordingly, the Appeal is dismissed.

Had I found that Ms. Antonelli’s transcript was part of the record, that the Arbitrator had erred in

misconstruing the Appellant’s submissions and there was no concession by the Appellant and that no other basis was provided for the said finding of entitlement, I would have remitted the matter to arbitration solely for a new hearing of the 8.3 week period in question. As the Arbitrator gave reasons for denying any further NEB entitlement and that part of his decision was not appealed, there would be no basis for returning the larger NEB issue to arbitration.

As stated in my March 7, 2008 decision, one remedy that would not be available would be for an appellate officer to review the transcripts and the exhibits entered and to make findings of fact as to whether the Respondent met the NEB criteria for the 8.3 weeks in question.

III. EXPENSES

If the parties are unable to agree on the legal expenses of this appeal proceeding, including the submissions leading to the interim decision herein of March 7, 2008, an expense hearing may be arranged in accordance with Rule 79 of the Code.

If either party has served a Bill of Costs, the other party should promptly provide a written response to the account, identifying the items in dispute and the reasons for the dispute, including whether entitlement to legal expenses is contested. If a party seeking its legal expenses has not yet served a Bill of Costs describing the expenses claimed, services received and costs, it should do so forthwith and, in any event, within the time limits of Rule 79.2(a) of the Code.

Regarding the legal expenses of the arbitration proceeding, by letter dated November 27, 2007, the Arbitrator stated that “in the circumstances of this case, it would be more appropriate to defer the issue of hearing expenses pending the outcome of the appeal.” Accordingly, the issue of arbitration expenses is now referred back to the Arbitrator.