Kofi Agyapong v. Jevco Insurance Company, 2016 ONFSCDRS 233

Financial Services Commission des

Commission services financiers

of Ontario de l’Ontario

Neutral Citation: 2016 ONFSCDRS 233

FSCO A11-003445

BETWEEN:

KOFI AGYAPONG

Applicant

and

JEVCO INSURANCE COMPANY

Insurer

REASONS FOR DECISION

Before: Arbitrator John Wilson

Heard: By written submissions

Appearances: Murray Tkatch and Kwaku Bona for Mr. Agyapong

Darrell March for Jevco Insurance Company

Following the hearing of this matter in Hamilton Ontario on January 25, 2016 I issued a decision dismissing Mr. Agyapong’s claim in its entirety. Jevco, as a result, has what is in effect a presumptive entitlement to its expenses or costs incurred in the proceeding as outlined in the Expense Regulation and Rule 75 of the Dispute Resolution Practice Code.

There is a complication, however. The hearing, as set up by Arbitrator Muzzi, consisted of three days, with the first day dedicated to a preliminary issue relating to whether or not Mr. Agyapong was out of time when he brought this arbitration. The balance of the hearing days was to be devoted to the substantive issues.

Because of a chain of events that transpired in the week prior to the hearing, the preliminary issue mutated and became a question as to whether or not Jevco had, in effect settled the preliminary issue, and if so, whether it could resile from that agreement to settle the preliminary issue.

Despite communications from counsel for Mr. Agyapong noting the circumstances of the withdrawal and reiterating his determination to get on with the substantive hearing, Jevco obstinately continued to raise the preliminary issue that it had withdrawn, necessitating a further preliminary issue to resolve the question of whether the time-limits argument could be re-opened.

I dealt with the preliminary issues at length in my original decision and found in favour of Mr. Agyapong on those issues. In making my decision, it was implicit that Jevco was unreasonable in first settling and then attempting to revive the preliminary issue it had raised.

Consequently I accept now that the actions of Jevco in first settling and then attempting to unsettle the preliminary issue constituted conduct that tended to unnecessarily delay or prolong the hearing process. This is not without consequences to the issue of expenses.

Jevco argues now that since it was successful entirely on the substantive issues, it should be entitled to its expenses as claimed, in their entirety. Mr. Agyapong, however feels that either no expenses should be payable or some recognition be made of Jevco’s complete lack of success on the preliminary issue it kept trying to resuscitate.

While I accept that Jevco would be entitled to its expenses due to its undisputed success, I find that the amounts it is entitled to claim as expenses should be reduced proportionately to reflect the unjustified conduct surrounding the preliminary issue.

Jevco claims to have expended some $42,457.50 in legal expenses in dealing with this arbitration. Realistically, it has reduced that amount to $18,052.07 to reflect billing at the legal aid rates mandated for FSCO arbitrations. While the total time claimed of 196.9 hours perhaps raises eyebrows for a three day hearing, I have no concrete evidence to suggest that this amount would be either inappropriate or the result of “over-lawyering” the file. Given the complexity of the claim put forward by Mr. Agyapong, I cannot say that this amount is unrealistic.

Jevco’s Bill of Costs however, does not specifically break out the portions of its expense claim that relate to preliminary issues. Nevertheless, a rough impression of the relevant times can be derived from looking at the hearing timetable.

In accordance with Arbitrator Muzzi’s pre-hearing directions, the first part of the hearing was devoted to the preliminary issues. While these mutated into the question of whether or not Jevco could raise again the issue of whether or not the arbitration was brought in a timely manner, an issue that Jevco lost, the effect was the same.

Roughly one third of the hearing time was set aside for the preliminary matters which were ultimately decided against Jevco. In the interest of simplicity and fairness, I find that it is appropriate to work with this ratio and award Jevco roughly two thirds of its claimed expenses, namely $12,000, not including disbursements and H.S.T.

The disbursements claimed of $2,286.93 appear to reflect the normal range of payments required in the context of an arbitration. I order them paid in full.

H.S.T on the above amounts would be payable and I order it paid as it is a necessary transactional cost.

Consequently, Mr. Agyapong shall pay to Jevco the amount of $16,144.23 as fixed expenses, including disbursements and H.S.T.

September 2, 2016

John Wilson

Arbitrator

Date