Zahir Rahic v. Allstate Insurance Company of Canada, 2011 ONFSCDRS 85

Neutral Citation: 2011 ONFSCDRS 85 FSCO A08-002832

BETWEEN:

ZAHIR RAHIC Applicant

and

ALLSTATE INSURANCE COMPANY OF CANADA Insurer

DECISION ON EXPENSES

Before: Edward Lee Heard: By telephone conference call on July 11, 2011.

Appearances: Karl Arvai for Mr. Rahic Todd J. McCarthy for Allstate Insurance Company of Canada

Issues:

The issue in this hearing is:

What is the amount of expenses to which Mr. Rahic is entitled in respect of this arbitration proceeding?

Result:

Mr. Rahic is entitled to expenses in the amount of $14,653.71, inclusive of GST (legal fees of $12,580.48 and disbursements of $2,073.23).

The hearing of this arbitration was scheduled to commence on May 5, 2010. This matter was settled on the morning of May 5, 2010, before the hearing commenced. As part of the settlement, the parties agreed that the Applicant, Mr. Rahic, was entitled to his expenses. Nevertheless, they were not able to agree as to the amount of those expenses, and have asked that I determine this issue.

Mr. Rahic’s counsel filed a Bill of Costs. I heard submissions from the parties on July 11, 2011. Two issues were raised by Mr. McCarthy, counsel for Allstate. The first concerned the number of hours billed as legal fees by Mr. Rahic’s representatives, and the second concerned a disbursement claimed by Mr. Rahic for an expert’s report.

Fees:

Mr. Rahic claimed $15,442.96 in fees (inclusive of GST). This was based on approximately 147.75 total hours of work performed by four lawyers: Mr. Arvai, Mr. Steiner, Mr. Nicolis, and Mr. Armour. This amount also included 17.1 hours of work performed by a clerk. All the work was performed during the time period from April 2008 to May 2010.

The work of Mr. Arvai (approx. 31.35 hours) was billed at $150.00 per hour. The work done by the other three lawyers (approx. 116.40 hours) was billed at $85.51 per hour. The work done by the clerk (approx. 17.0 hours) was billed at $25.36 per hour.

Mr. McCarthy contested neither the rate of billing, nor the number of hours of work performed by Mr. Arvai. He did not contest the number of hours of work or rate of billing for the clerk. Mr. McCarthy also did not contest the billing rate charged by the other three lawyers, but he did contest the number of hours of work performed by them. According to Mr. McCarthy, that amount (116.40 hours) was excessive. In particular, he argued that the amount claimed for Mr. Armour, who billed approximately 100.8 hours at $85.51 per hour, was excessive.

Mr. McCarthy raised one other issue. He argued that he amount claimed for the report prepared by Rich Rotman exceeded that permitted under the Expense Regulation.

THE LAW:

Section F – Expense Regulation

Excerpt from Regulation 664, R.R.O. 1990, Made Under the Insurance Act, as amended.

(1) The expenses set out in the Schedule are prescribed for the purpose of subsection 282(11) of the Act.

(2) An arbitrator shall, under subsection 282 (11) of the Act, consider only the following criteria for the purposes of awarding all or part of the expenses incurred in respect of an arbitration proceeding:

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.
Whether the insured person refused or failed to submit to an examination as required under section 42 of Ontario Regulation 403/96 (Statutory Accident Benefits Schedule — Accidents on or after November 1, 1996) made under the Act or refused or failed to provide any material required to be provided by subsection 42 (10) of that regulation.
Whether the insured person refused or failed to submit to an examination as required under section 44 of Ontario Regulation 34/10 (Statutory Accident Benefits Schedule — Effective September 1, 2010), made under the Act, or refused or failed to provide any material required to be provided under subsection 44 (9) of that regulation.

(3) Upon the request of