REASONS FOR DECISION

Before: Arbitrator Anne Morris Heard: In person at St. Catharines on May 28, 2015

Appearances: No one appeared for Ms. Linda Tran Mr. Benjamin Hutchinson appeared for State Farm Mutual Automobile Insurance Company

Issues:

The Applicant, Ms. Linda Tran, claims to have been injured in a motor vehicle accident on October 24, 2011. She applied for and received statutory accident benefits from State Farm Mutual Automobile Insurance Company (“State Farm”) payable under the Schedule.¹ Disputes arose as to whether or not certain benefits were payable. The parties were unable to resolve their disputes through mediation, and Ms. Tran applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The issues in this Hearing are:

Is Ms. Tran entitled to a Medical Benefit, pursuant to s. 2(2) or s. 15 of the Schedule for services provided by Dr. Mizel as follows:

a) $2,614.20 pursuant to an assessment and treatment plan (OCF-18), dated November 7, 2011;

b) $2,206.45 pursuant to an OCF-18, dated November 7, 2011;

c) $2,639.61 pursuant to an OCF-18, dated February 28, 2011;

d) $1,275.44 pursuant to an OCF-18, dated January 24, 2012;

e) $2,485.44 pursuant to an OCF-18, dated January 24, 2012; and/or

f) $1,261.44 pursuant to an OCF-18, dated January 31, 2012?
Is State Farm liable to pay a Special Award because it unreasonably withheld or delayed payments to Ms. Tran?
Is State Farm liable to pay Ms. Tran’s expenses in respect of this Arbitration?
Is Ms. Tran liable to pay State Farm’s expenses in respect of this Arbitration?
Is Ms. Tran entitled to interest for the overdue payment of benefits?

Result:

Ms. Tran’s claims against State Farm are dismissed.
Ms. Tran is to pay expenses to State Farm in the amount of $1,750.00 inclusive of all costs, disbursements and applicable taxes.

EVIDENCE AND ANALYSIS:

Ms. Tran did not attend at the Hearing of this matter and still had not attended thirty minutes after the Hearing was scheduled to start. I was unable to reach her by telephone.

The Hearing proceeded in her absence pursuant to Rule 37.7 of the Dispute Resolution Practice Code (“the Code”).

I am satisfied that Ms. Tran was given notice of the Hearing at her last known address contained in the records of the Dispute Resolution Group (including ADR Chambers) as required by Rule 5.7 of the Code.

Ms. Tran bears the onus of proving entitlement to the benefits claimed by her. Because she did not appear at the Hearing and no evidence was presented to support her claims, this Arbitration is dismissed.

EXPENSES:

I find that State Farm, as the “successful party” within the meaning of subsection 12(2) of the Expense Regulation, R.R.O. 1990, Regulation 664, is entitled to its expenses.

State Farm provided a Bill of Costs showing three total amounts:

a) An “actual rate” of $12,352.65 or full indemnity. This is not in keeping with the amounts recoverable for representative fees pursuant to Rule 78.1 of the Code which provides for expenses for representatives at the appropriate legal aid tariff rate.

b) The “maximum rate” of $7,614.15 pursuant to the provision of Rule 78.1 which allows an hourly rate beyond the legal aid tariff rate of up to $150.00 “where an adjudicator is satisfied that a higher amount for legal fees to an insured person is justified.” This provision applies to legal fees to an insured person and not to an Insurer.

c) The “Legal Aid Rate” of $5,597.32. Of this figure, a total of $4,173.17 is claimed for fees plus $3.45 for disbursements. An additional amount of $1,420.70 is claimed for HST on taxable services/disbursements. The HST amount is excessive.

I note from the information in the file that the Applicant has not participated in the Arbitration process, failing to attend at two scheduled Pre-Hearings and failing to identify or summons witnesses, serve a documents list, or show any intention to participate in the Hearing. The Insurer knew or ought to have known from this lack of participation in the Pre-Hearing process that the Applicant would not attend the Hearing. This would tend to minimize the level of preparation required.

I do not believe that this matter warrants a line by line examination of the Insurer’s expenses. The general approach with respect to fees is to take a pragmatic, broad-strokes approach, with a view to fixing an amount that is reasonable. In this regard, I note the following decisions.

In Reid and ING Insurance Company of Canada,² Arbitrator Killoran held with respect to Arbitration legal expenses that:

The relationship between insurer and insured is a contractual one. The insured is entitled to access the dispute resolution process at FSCO as a result of that contract. The Insurance Act and its regulations must be interpreted in such a way as to uphold the protective and remedial nature of the legislation of which it follows.

In Halim and Security National Insurance Co./Monnex Insurance Mgmt. Inc.,³ Director’s Delegate, Lawrence Blackman held:

I find that these expense criteria do not exist in a vacuum segregated from the overall legislative intent. Rather, the criteria are defined by and help define the broader, overarching legislative intentions, including consumer protection, as set out by the Supreme Court of Canada in Smith v. Co-Operators General Insurance Co., 2002 SCC 30, [2002] 2 S.C.R. 129, which encompasses a fair and reasonable measure of access to justice.

I fix the Insurer’s reasonable expense at $1,750.00 including disbursements and all applicable taxes. I find this amount to be reasonable given the time required to review the file, obtain instructions, prepare and file a response, prepare for and attend two Pre-Hearing discussions, and attend on the date of the Hearing at St. Catharines, which involved travel time.

Accordingly, and pursuant to subsection 282(11) of the Insurance Act, R.S.O. 1990, c.1.8, as amended, Ms. Tran is ordered to pay State Farm’s expenses in the amount of $1,750.00 (inclusive of all costs, disbursements and taxes).

August 13, 2015

Anne Morris Arbitrator

ARBITRATION ORDER

Under section 282 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:

Ms. Tran’s claims against State Farm are dismissed.
Ms. Tran is to pay expenses to State Farm in the amount of $1,750.00 inclusive of all costs, disbursements and applicable taxes.