Neutral Citation: 2013 ONFSCDRS 136 FSCO A11-002435

BETWEEN:

MASOOD HEJRAN Applicant

and

PERSONAL INSURANCE COMPANY OF CANADA Insurer

DECISION ON EXPENSES

Before: Edward Lee Heard: Final submissions received August 8, 2013

Appearances: Mr. Hejran was self-represented Thomas Hughes for Personal Insurance Company of Canada

This matter arose as a result of teleconference that took place on March 1, 2013, arranged by the Financial Services Commission of Ontario. Mr. Masood Hejran participated and was initially represented by Mr. Gary Mazin. Mr. Thomas Hughes participated and represented the Personal Insurance Company of Canada (“The Personal”).

During the course of this teleconference, Mr. Hejran dismissed his counsel, Mr. Mazin, and stated he would represent himself. At his request, I adjourned the hearing, previously scheduled for March 4-7, 2013, to January 13-16, 2014. Mr. Hughes objected to the granting of the adjournment, and requested an opportunity to speak to costs thrown away as a result. I agreed to hear submissions in regard to expenses as a result of the adjournment and gave the parties a deadline to file their argument and evidence.

The issues in this hearing are:

Is Mr. Mazin personally liable to the Personal for expenses incurred as a result of the adjournment?
Is Mr. Hejran liable to the Personal for expenses incurred as a result of the adjournment?

Result:

Mr. Mazin is not personally liable to the Personal for expenses incurred as a result of the adjournment.
Mr. Hejran is not liable to the Personal for expenses incurred as a result of the adjournment.

CLAIMS MADE BY MR. HUGHES:

Mr. Hughes filed his argument and evidence on June 18, 2013. Mr. Mazin filed a letter on June 19, 2013. Mr. Hughes filed a final reply on August 8, 2013.

In his argument, Mr. Hughes sought costs thrown away as a result of the adjournment from Mr. Mazin personally, or in the alternative, from Mr. Hejran. He also sought to have his expense claim heard and the order issued before the commencement of the hearing now re-scheduled.

Mr. Hughes based his claim on several grounds. First, he argued that Mr. Mazin was personally liable for costs because he commenced or conducted the proceeding without authority from the insured person (Section 282(11.2)(a) of the Insurance Act).

Second, he claimed that Mr. Mazin had not advised the insured person that he could be liable to pay all or part of the expenses of the proceeding (Section 282(11.2)(b) of the Insurance Act).

Third, he claimed that Mr. Mazin had commenced a proceeding that was frivolous or vexatious or had caused expenses to be incurred without reasonable cause (Section 282(11.2)(b) and (c) of the Insurance Act).

EVIDENCE AND ANALYSIS:

(a) Is Mr. Mazin personally liable to The Personal for expenses incurred as result of the adjournment?

Mr. Hughes claims that Mr. Mazin commenced or conducted the proceeding without the authority of Mr. Hejran because the application (filed July 25, 2011), was not signed by Mr. Hejran. I am not convinced that an unsigned application necessarily means it had been commenced and conducted without the insured’s authority. There may be a reasonable explanation for the absence of a signature.

First, Mr. Hughes’ supporting materials include the transcript of the examination under oath of Mr. Hejran, conducted on May 5, 2010, at the request of the Personal. The transcript clearly shows that Mr. Hejran attended the examination in the company of Navdit Dhillon of Mazin Rooz Mazin.¹ In addition, Mr. Hejran stated during that examination that he had made a claim as a result of the accident “through his lawyer”.²

Second, I note that Mr. Hejran participated in, and was represented by Mr. Mazin, at the pre-hearing discussion before Arbitrator J.R. Richards on May 8, 2012.

Finally, Mr. Hejran also participated in the teleconference of March 1, 2013 before me. During that teleconference, Mr. Hejran had every opportunity to inform me that the application had been commenced or conducted without his authority, but made no such suggestion.

The only evidence provided by Mr. Hughes was the statement of the adjuster, Michelle Hamilton, in her affidavit: “I verily believe that when Mr. Mazin filed his application for arbitration on July 19, 2011 [sic], without authority from his client.”³ No reasoning or explanation was given as to why the affiant held this belief. It is contrary to other unequivocal evidence, and I give this statement no weight whatsoever.

Therefore, I find Mr. Hughes’ claim that the proceeding had been commenced and conducted without the authority of Mr. Hejran to be utterly groundless.

Mr. Hughes’ second claim was that Mr. Mazin had failed to inform Mr. Hejran that he might be liable to pay all or part of the expenses of the proceeding. How Mr. Hughes managed to pierce the solicitor-client privilege remains a mystery, but the “evidence” provided to support this assertion was even less convincing than that presented for the previous. Once more, recourse was made to Ms. Hamilton in her affidavit: “I further believe that he [Mr. Mazin] did not explain the cost consequences of his actions to his client.”⁴

Similarly, Ms. Hamilton again failed to explain how or why she formulated this belief, and I accordingly give it no weight. Mr. Hughes’ second argument is also unproven.

Mr. Hughes claims that Mr. Mazin commenced a proceeding that was frivolous or vexatious or caused expenses to be incurred without reasonable cause.

I am not convinced this conclusion is correct. First and most importantly, this matter has yet to be adjudicated. A full hearing on the merits has been scheduled where both parties will have an opportunity to present their case. At the full hearing, Mr. Hejran may very well be entirely successful in his claim against the Personal.

Most of Mr. Hughes’ argument is centered about attendant care. In fact, attendant care is but one of the issues set down for the January hearing. Even if the claim for attendant care were completely unfounded, that would not mean the entire application was frivolous, vexatious or caused expenses to be incurred without reasonable cause.

Mr. Hughes’ contention that Mr. Mazin “knew or should have known his client did not require attendant care…” is based on a selective reading of the examination under oath. Of the twenty-six pages of transcript provided, only three short questions were put to the insured in regard to attendant care.⁵ All three questions were answered in the negative, but they were asked by a representative of the Personal, and no rebuttal questions asked by the insured’s counsel. In previous pages of the examination under oath, the insured spoke at length of the pain he still felt, the problems he had with his neck, arms, shoulders, back and his inability to perform many of his pre-accident daily activities. The answers given to the three questions put by the insurer’s representative do not necessarily lead to the conclusion that the application was frivolous, vexatious or caused expenses to be incurred without reasonable cause.

Further, the transcript of the examination under oath itself was incomplete and redacted at page 25, further reducing its probative value.

I also am not convinced that any order should be made against Mr. Mazin because he did not contact an expert witness before the hearing date as suggested by Michelle Hamilton.⁶ At FSCO proceedings, a party is not required to call every expert witness. Filing a report may be sufficient.⁷

Finally, any remedy for Mr. Mazin’s or Mr. Hejran’s failure to fulfill an undertaking for productions may be sought at the hearing on the merits, as indicated in the Dispute Resolution Practice Code.

I find Mr. Hughes has not made out his case. No costs are to be awarded personally against Mr. Mazin.

(b) Is Mr. Hejran liable to The Personal for expenses incurred as a result of the adjournment?

In the alternative, Mr. Hughes claims Mr. Hejran should be liable for these expenses because Mr. Hejran knew the claim was “devoid of merit”. Much of the previous analysis is applicable to the claim made against Mr. Hejran. As stated above, this matter has not yet been adjudicated.

This matter was adjourned at Mr. Hejran’s request on March 1, 2013. The hearing had been scheduled to commence on March 4, 2013. Mr. Hughes submitted a Bill of Costs claiming a total of $12, 052.29, and included 5.0 hours under the heading, “Interview and Prepare Witnesses for arbitration”. None of these witnesses were named in the Bill of Costs. There was no claim for cancellation fees or conduct money for experts or others. No invoices were submitted for any other fees related to the hearing that had originally been scheduled for March 4-7, 2013. By Mr. Hughes’ own assertion, the insured’s case was “devoid of merit”.⁸

I am not convinced that any preparation or costs (whatever they were) have been “thrown away” as a result of the adjournment granted on March 1, 2013. In the absence of any detail, I find all preparation already performed in anticipation of the March hearing date remains applicable for the hearing now scheduled for later this year.

The motion for expenses and costs thrown away as a result of the adjournment is dismissed.

October 28, 2013

Edward Lee Arbitrator

Date

Financial Services Commission of Ontario