Financial Services Commission des
Commission services financiers
of Ontario de l’Ontario
Neutral Citation: 2013 ONFSCDRS 67
FSCO A09-003193
BETWEEN:
ENRICO RUSSO
Applicant
and
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
Insurer
REASONS FOR DECISION
Before: Rosemary Muzzi
Heard: December 5, 2011, at the offices of the Financial Services Commission of Ontario in Toronto.
Written submissions received from State Farm on January 20, 2012 and responding submissions received from Mr. Russo on February 15, 2012.
Appearances: Peter B. Cozzi for Mr. Russo
Robert S. Franklin for State Farm Mutual Automobile Insurance Co
Overview:
Enrico Russo, the applicant, was injured in a motor vehicle accident on January 15, 2007 while driving a company vehicle.1 He applied for statutory accident benefits from State Farm payable under the Schedule.2 State Farm denied payment of certain benefits. The parties were unable to resolve their disputes through mediation and, as a result, Mr. Russo applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.
The arbitration hearing of Mr. Russo’s claims was set for the week of December 5, 2011 but Mr. Russo never appeared for the hearing. Further, Mr. Russo did not communicate with the Commission in any other manner in relation to his arbitration hearing.
In addition, though represented, no case was put forward for Mr. Russo because counsel had no specific instructions to present evidence or make submissions on Mr. Russo’s behalf.3
Consequently, State Farm requested an order dismissing Mr. Russo’s arbitration and sought its expenses of the arbitration.
The issues in this hearing are:
Should Mr. Russo’s arbitration be dismissed?
Should State Farm be awarded its expenses?
Result:
Mr. Russo’s arbitration is dismissed.
State Farm is entitled to its reasonable expenses as determined herein.
EVIDENCE AND ANALYSIS:
Issue 1: Should Mr. Russo’s arbitration be dismissed?
In order to establish his entitlement to benefits, Mr. Russo must provide evidence supporting his claims and prove his claims on a balance of probabilities.
Despite notices delivered to his last known address, Mr. Russo did not attend the arbitration and did not communicate in any manner with the Commission. Mr. Russo also failed to communicate with or otherwise instruct counsel who was, as a result, unable to present any case on his behalf. Consequently, there was no evidence before me to prove Mr. Russo’s claims for accident benefits. Therefore, Mr. Russo’s claims are dismissed.
Issue 2: Should State Farm be awarded its expenses?
The Expense Regulation requires an arbitrator to consider seven criteria in awarding all or part of the expenses incurred in respect of arbitration.4
Having been completely successful in the arbitration, and there being no other relevant criteria applicable in this proceeding, I find that State Farm is entitled to its reasonable expenses.
State Farm submitted a Bill of Costs along with its submissions itemizing the amount of lawyer and clerk time expended in preparation for this arbitration and the disbursement costs. Counsel for Mr. Russo, not having been specifically instructed, provided some general applicable submissions.
State Farm seeks a total of $4,954.64 (including HST) for lawyer and clerk time. In addition, it seeks $457.29 (including HST) for disbursements.
I have examined the Bill of Costs and agree with Mr. Cozzi’s submissions that there would have been some efficiency in preparation dealing with the common issues in the two related arbitrations and that, in any event, no substantive arbitration hearing was conducted in the Russo matter; therefore, there should be a reasonable reduction in the expenses awarded. As a result, I have reduced the counsel time by eliminating the increments of time devoted to basic handling of the file and client contact and focused on the actual time that would have been expended in preparation for the arbitration and allowed the rates as claimed:
Fees:
Robert Franklin 5.7 hours @ $150 =
Joanna Cox 12.9 hours @ $81.44 =
Tracy Xu (clerk) 33 hours @24.15 =
Total fees: $2,702.53 + 13% HST =
$ 855.00
1,050.58
796.95
$3,053.85
I have also considered Mr. Cozzi’s submissions in relation to the disbursements and discount the amounts claimed for process serving by KAP and Cyberbahn ($44.07 and $82.81 respectively – both inclusive of HST) because those expenses relate to the other matter consolidated with this one. The total allowable for disbursements therefore is $330.41.
The total of expenses and disbursements owing to State Farm is $3,384.26.
May 30, 2013
Rosemary Muzzi
Arbitrator
Date
Financial Services Commission des
Commission services financiers
of Ontario de l’Ontario
Neutral Citation: 2013 ONFSCDRS 67
FSCO A09-003193
BETWEEN:
ENRICO RUSSO
Applicant
and
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
Insurer
ARBITRATION ORDER
Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
The arbitration is dismissed.
State Farm is entitled to its expenses and disbursements assessed in the amount of $3,384.26.
May 30, 2013
Rosemary Muzzi
Arbitrator
Date
Footnotes
- Mr. Russo’s co-worker, Giovanni Bruno, was involved in the same accident and also applied for arbitration. Mr. Bruno’s case was heard and the reasons in respect of his claims are provided in a separate written decision.
- The Statutory Accident Benefits Schedule - Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.
- Communicated to State Farm’s counsel by letter dated December 9, 2011 and copied to the Commission.
- Under subsection 282(11) of the Insurance Act, R.S.O. 1990, c.I.8, as amended, an arbitrator may award expenses to either party according to criteria prescribed in subsection 12(2) of the Expense Regulation, R.R.O. 1990, Regulation 664, made under the Insurance Act, as amended.