Financial Services Commission of Ontario
Neutral Citation: 2014 ONFSCDRS 3 Appeal: P08-00018 Office of the Director of Arbitrations
Allstate Insurance Company of Canada Appellant
and
Edna Klimitz Respondent
Before: David Evans Representatives: Grant R. Dow for Allstate Insurance Company of Canada Barry Goldman for Mrs. Edna Klimitz Hearing Date: October 16, 2013
APPEAL EXPENSES ORDER
Under section 283 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
- Mrs. Edna Klimitz shall pay Allstate Insurance Company of Canada its legal expenses of this appeal in the amount of $3,000, inclusive of disbursements and HST/GST.
January 9, 2014
David Evans Director’s Delegate
REASONS FOR DECISION
I. NATURE OF THE APPEAL
In a decision dated March 16, 2010, I allowed an appeal brought by Allstate Insurance Company of Canada: I rescinded Arbitrator Sapin’s order dated April 18, 2008 that the parties had concluded a settlement for $17,000 for Mrs. Klimitz’s claims.
Since then, the Arbitrator found that Mrs. Klimitz was precluded from proceeding to arbitration because she waited too long to seek mediation after Allstate delivered a valid denial of benefits (FSCO A07-001142, April 13, 2012). The decision was reversed on appeal (FSCO P12‑00026, March 21, 2013) because Director’s Delegate Blackman found the denial invalid; his decision is now under judicial review.
In any event, Allstate now seeks its appeal expenses of my March 10, 2010 appeal decision.
II. BACKGROUND AND ANALYSIS
Mrs. Edna Klimitz was injured in a motor vehicle accident on November 7, 2003 and sought non-earner benefits under the SABS–19961 from Allstate. The Arbitrator found that, during mediation in early 2007, Allstate made an all-inclusive settlement offer of $17,000 that Mrs. Klimitz later accepted.
On appeal, I found that, aside from errors about the onus of proof and evidence, the Arbitrator erred in finding a meeting of minds when a discrepancy in figures showed there was not.
The parties agree that Allstate is entitled to its appeal expenses. However, they disagree on the amount of the counsel fee and, because of when the work was done, whether GST or HST applies to it.
Allstate seeks 27.8 hours of counsel time, including research, preparation for the appeal, attendance at the appeal hearing, and post-hearing work of about 2.5 hours. At the appropriate legal aid rate plus HST, this comes to $2,900. It also seeks an additional 1.5 hours for preparation and attendance at the expenses hearing. The total including disbursements comes to about $3,285.
Mrs. Klimitz notes that her counsel spent about 10 hours less in preparation and attendance at the hearing. She submits that $2,000 in total would be a reasonable figure, inclusive of GST.
However, Allstate’s claim includes the post-hearing work of about 2.5 hours already noted. In addition, I find that Allstate, as the appellant, had more work to do than the respondent in researching the issues and preparing the submissions and that the issues were somewhat more complex than the average. I find this explains the difference in time allotted by counsel.
I also note that the amount claimed is close to the historic norm for successful insurers of $2,800: see Bains and RBC General Insurance Company, (FSCO P09-00005, September 8, 2010).
Finally, I find I do not have to determine the GST versus HST issue because I am making a global and not a line-by-line assessment: Henri and Allstate Insurance Company of Canada, (OIC A‑007954, August 8, 1997).
Accordingly, I find that Allstate is entitled to legal appeal expenses of $3,000, inclusive of disbursements and GST/HST.
January 9, 2014
David Evans Director’s Delegate
Footnotes
- The Statutory Accident Benefits Schedule — Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.