Neutral Citation: 2016 ONFSCDRS 280

FSCO A16-000442

BETWEEN:

LIE XIN (JAMES) YANG

Applicant

and

ECONOMICAL MUTUAL INSURANCE COMPANY

Insurer

Before: Isabel Stramwasser

Heard: By written submissions received August 11, 2016 and by telephone conference call on August 20, 2016

Appearances: Sahereh Baghbani-Najafabad for Mr. Yang Matt Duffy and Leanne Zawadzki for Economical Mutual Insurance Company

Issues:

The Applicant, Lie Xin (James) Yang, was injured in a motor vehicle accident on February 7, 2014. He applied for statutory accident benefits from Economical Mutual Insurance Company (“Economical”), payable under the Schedule.¹ Disputes arose concerning his entitlement to benefits. The parties were unable to resolve their disputes through mediation and, in January 2016, Mr. Yang applied for arbitration at the Financial Services Commission of Ontario, under the Insurance Act.²

Shortly thereafter, Economical brought a motion under section 55 of the Schedule to preclude Mr. Yang from proceeding to arbitration because he failed to attend insurer’s examinations or produce documents. The parties completed their written and oral submissions on this motion in August 2016. During the hearing, the parties reached a settlement of all issues in dispute in the motion, except the matter of interim expenses. Consequently, Economical sought a decision on interim expenses.

The issue in this hearing is:

Is one party liable to pay the interim expenses of the other under section 282(11) of the Insurance Act and, if so, in what amount?

Result:

I defer the matter of expenses of this motion to the hearing arbitrator.

EVIDENCE AND ANALYSIS:

At the hearing, both parties made submissions on entitlement to expenses, but did not address quantum. Economical submitted that it had no choice but to bring the motion because of Mr. Yang’s failure to respond to its requests for examinations and productions. Mr. Yang maintained that the motion was unnecessary because he had responded to all requests in a timely manner — and that any delays were due to Economical sending its requests to the wrong office and to Mr. Yang not receiving them at home. Notably, Economical supported its case with sworn evidence, but Mr. Yang did not.

The only argument Economical made against deferring the decision on interim expenses to the hearing arbitrator was that this file might settle before a hearing. However, expenses could be included as a term of settlement. Alternately, the parties could request an expense hearing after settlement or after arbitration.

Expense awards for interlocutory proceedings should be reserved for exceptional cases, such as where there has been misconduct, and I am not persuaded that this is an exceptional case. While Economical has made a case for misconduct and Mr. Yang has failed to support his defence in evidence, it is possible that there is evidence to support Mr. Yang’s position. Moreover, I am alive to the reality that the hearing arbitrator is best placed to consider any misconduct in the context of the entirety of these proceedings.

Interim hearings engender further expenses, disputes and delays. In this case, the parties would have to return before me for another interim hearing on quantum. Yet, it is the Commission’s objective to promote the most just, quickest and least expensive resolution of a dispute.

CONCLUSION:

I defer the issue of expenses of this interim motion to the hearing arbitrator.

October 20, 2016

Isabel Stramwasser Arbitrator

Date

Financial Services Commission of Ontario