Financial Services Commission of Ontario
Neutral Citation: 2014 ONFSCDRS 88 Appeal P13-00022 OFFICE OF THE DIRECTOR OF ARBITRATIONS
SOZAN HURMZ Appellant
and
WAWANESA MUTUAL INSURANCE COMPANY Respondent
BEFORE: Delegate Lawrence Blackman
REPRESENTATIVES: Mr. Neritan Ciraku for the Appellant, Ms. Sozan Hurmz Mr. Darrell P. March for the Respondent, Wawanesa Mutual Insurance Company
HEARING DATE: May 28, 2014 by telephone conference call
APPEAL EXPENSE ORDER
Under section 283 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:
- The Respondent is entitled to its legal expenses of this appeal fixed in the amount of $3,931.21, inclusive of HST and disbursements.
May 30, 2014
Lawrence Blackman Director’s Delegate
REASONS FOR DECISION
I. NATURE OF THE APPEAL
My February 11, 2014 appeal decision dismissed this appeal and confirmed the Arbitrator’s July 4, 2013 decision. If the parties could not agree on the legal expenses of the appeal, an expense hearing was to be requested within sixty days.
The Respondent’s March 20, 2014 submissions requested $49,290.84 in legal expenses for both the arbitration and the appeal. The Respondent’s revised April 1, 2014 Bill of Costs sought $4,512.48 for this appeal.
II. ENTILEMENT TO LEGAL EXPENSES
Applying the criteria in Rule 75 of the Dispute Resolution Practice Code (Fourth Edition – Updated January 2014) (the “Code”), I find the Respondent entitled to its reasonable appeal expenses. Of greatest relevance to this particular case is that the Respondent was wholly successful in this appeal proceeding.
The Respondent referenced an Offer to Settle it submits it made at arbitration as well as the Appellant’s failure at arbitration to respond to productions requests. These considerations are best put to the adjudicator considering arbitration expenses. My own prior appeal decision noted the preparation, assistance and professionalism of both counsel attending the appeal hearing.
III. QUANTUM OF LEGAL EXPENSES
In Henri and Allstate Insurance Company of Canada, (OIC A-007954, August 8, 1997), Arbitrator Makepeace agreed that the overriding consideration in fixing legal expenses is reasonableness. Arbitrator Kirsch, in Lunn and State Farm Mutual Automobile Insurance Company, (OIC A-013960, March 15, 1996), held that a line-by-line assessment of the expenses claimed was not required.
In Bains and RBC General Insurance Company, (FSCO P09-00005, September 8, 2010), on review of prior appeal expense awards, the average appeals expense award was $4,733.58 where expenses were awarded to insured persons (reflecting a higher allowed hourly rate of up to $150 an hour) and $2,812.91 where expenses were awarded to insurers, who are subject to a lower cap for legal expenses.
The Respondent seeks a $150 hourly rate for its senior, Tier 3 counsel. Rule 78 of the Code specifically restricts the $150 hourly rate to insured persons. For insurers’ counsel, the maximum hourly rate is that established under the Legal Aid Services Act, 1998, for professional services in civil matters before the Ontario Superior Court of Justice, including the experience allowance.
For junior counsel, the Respondent seeks an hourly rate of $94.28. The hourly rate in place at the same period in time for Tier 3 is $117.85. The difference between $150 and $117.85 for the 16 hours claimed by senior counsel, inclusive of HST, is $581.27. This leaves a net claim of $3,931.21, consisting of $3,511.75 for counsel fee and $419.46 for disbursements.
The Appellant does not object to any other item in the Appellant’s Bill of Costs. I find the hours, hourly rates and disbursements otherwise claimed reasonable and in line with prior appellate expense awards. Accordingly, I find the Respondent entitled to its legal expenses of this appeal fixed in the amount of $3,931.21, inclusive of HST and disbursements.
May 30, 2014
Lawrence Blackman Director’s Delegate