Financial Services Commission of Ontario

Commission des services financiers de l’Ontario

Neutral Citation: 2015 ONFSCDRS 188

Appeal P13-00031

OFFICE OF THE DIRECTOR OF ARBITRATIONS

THEODORE GALARNEAU Appellant

and

ALLSTATE INSURANCE COMPANY OF CANADA Respondent

BEFORE: David Evans

REPRESENTATIVES: Brian Arthur Odo Gualazzi for Mr. Galarneau Ian D. Kirby for Allstate Insurance Company of Canada

HEARING DATE: On the record, based on submissions received by July 23, 2015

APPEAL ORDER

Under section 283 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:

Mr. Theodore Galarneau shall pay Allstate Insurance Company of Canada its legal expenses of the appeal proceedings herein of $1,977.17, inclusive of disbursements and HST.

September 15, 2015

David Evans Director’s Delegate

Date

REASONS FOR DECISION

I. NATURE OF THE APPEAL

In a decision dated May 27, 2015, I rejected Mr. Galarneau’s appeal of the Arbitrator’s order that he is not entitled to non-earner benefits (NEBs) under s. 12 of the SABS–1996.¹ Allstate now seeks its appeal expenses.

II. BACKGROUND AND ANALYSIS

On November 27, 1999, when he was a ten-year-old grade 4 student, Mr. Galarneau was injured in a motor vehicle accident. At age 16 he became eligible to claim payment for NEBs.

The Arbitrator found that Mr. Galarneau did not meet the tests for NEBs under s. 12 of the SABS. He also found that Mr. Galarneau was not entitled to benefits simply on a procedural basis.

On appeal, I found that little of Mr. Galarneau’s submissions related to any substantive basis for overturning the Arbitrator’s decision: “The Arbitrator considered and applied the relevant criteria for determining entitlement to NEBs set out by the Court of Appeal in Heath v. Economical Mutual Insurance Company, 2009 ONCA 391, [2009] 95 O.R. (3d) 785. Most of the Arbitrator’s decision then consists of discussing the evidence and making findings of fact, none of which are reviewable.”

As for the procedural grounds, I found that the Arbitrator was correct in finding that the failure of Allstate to provide adequate notice or to request an assessment did not automatically entitle Mr. Galarneau to NEBs. The appeal was therefore denied.

Allstate served its Bill of Expenses for the Appeal totalling $1,977.17 on June 16, 2015, noting that there had been no response from Mr. Galarneau. Counsel’s letter also noted that “the time expended is quite modest, the disbursements limited and the hourly rate simply in accordance with the Legal Aid Tariff. I have not had any reason provided to me to suggest that in the circumstances the Respondent/Insurer is not entitled to its expenses of the Appeal.”

On June 17, 2015, I wrote to counsel for Mr. Galarneau that he could respond by July 6, 2015, and the insurer could provide a reply by July 13, 2015. I also wrote:

Since R. 79.2(e) allows an assessment based simply on written submissions, and s. 283(4) provides that the Director (or his Delegate) “may determine the appeal on the record,” I propose determining the appeal expenses without the need of a hearing. The parties should advise if they object. Otherwise, the decision on expenses will follow after July 13, 2015 without a further notice of hearing.

I received no response from Mr. Galarneau. On July 23, 2015, counsel for Allstate wrote that as there had been no response, there was no need for a reply.

Rule 58.1 provides that “The Director [or his Delegate] may proceed with an appeal even though a party fails to file any document required by these Rules.” Rule 58.2 does not apply, as no notice of hearing was sent or required.

The criteria for the purposes of awarding all or part of the expenses incurred in respect of an arbitration or appeal proceeding are set out in the Expense Regulation, s. 12 of O. Reg. 664, R.R.O. 1990. The first criterion listed in the Regulation is “Each party’s degree of success in the outcome of the proceeding.” Allstate was entirely successful in the appeal. I see no basis to consider any other criterion, so Allstate is entitled to its expenses.

As to the amount, Allstate is correct that the amount claimed is modest. Indeed, it is well below the average expense claim awarded to insurers on appeal: see Bains and RBC General Insurance Company, (FSCO P09-00005, September 8, 2010).

While a line-by-line assessment of the expenses claimed is not appropriate, and rather, a global assessment of reasonable expenses should be made, sometimes the entirety of an insurer’s Bill of Expenses is reasonable. The total number of hours claimed for preparation, attendance at the appeal, and post-appeal work including preparing the Bill of Expenses, is 13.4. The total disbursements come to about $50. Accordingly, I find the entirety of the Insurer’s Bill of Expenses reasonable.

Therefore, Mr. Galarneau shall pay Allstate its reasonable legal expenses of $1,977.17.