Bhupinder Singh Grewal v. AIG Commercial Insurance Company of Canada, 2016 ONFSCDRS 57

Financial Services Commission des

Commission services financiers

of Ontario de l’Ontario

Neutral Citation: 2016 ONFSCDRS 57

FSCO A09-002980

BETWEEN:

BHUPINDER SINGH GREWAL

Applicant

and

AIG COMMERCIAL INSURANCE

COMPANY OF CANADA

Insurer

DECISION ON EXPENSES

Before: Richard Feldman

Heard: Written submissions received by November 20, 2015

Appearances: Frank Burns on behalf of the Applicant

J. Claude Blouin on behalf of the Insurer

Background:

The Applicant made numerous claims against the Insurer arising from an accident that occurred on January 18, 2009. The Applicant was claiming, amongst other things: caregiver benefits; income replacement benefits; housekeeping and home maintenance benefits; attendant care benefits; the cost of various assessments; and numerous medical and rehabilitation benefits. The disputed issues proceeded to arbitration and were heard by me on September 30 through October 3, 2013. Written submissions were completed by June 19, 2014. On August 7, 2014, I issued my written decision in this arbitration proceeding. The Applicant was successful on one claim only (in the amount of $1,464.46). For the reasons attached to my decision, I dismissed all of the Applicant’s other claims. With respect to his claim for $56,600.00 U.S. for the cost of assessment and treatment recommended by Dr. Connell with respect to the Applicant’s “co-morbid traumatic brain injury and post-traumatic stress disorder”, although this claim was also dismissed (for the reasons provided), I explicitly left it open to the Applicant to submit a new treatment plan to the Insurer for whatever treatment his expert(s) deems to be reasonable and necessary once valid neuropsychological test results are obtained. Pursuant to Rules 75-79 of the Dispute Resolution Practice Code, I gave the parties 30 days in which to request adjudication of the issue of the expenses of the arbitration proceeding.

On August 26, 2014, counsel for the Insurer wrote to the Financial Services Commission of Ontario (“FSCO”) and to counsel for the Applicant, requesting a hearing to determine that issue. Before an expense hearing could be scheduled, however, the Applicant appealed my decision of August 7, 2014.

Ultimately, the decision of August 7, 2014 was upheld on appeal. The Director’s Delegate who heard the appeal did not deal with the issue of the expenses related to the original hearing. After the appeal was concluded, the Insurer wrote to FSCO to renew its request for a determination of the issue of the expenses. Brief written submissions were received from both parties concerning this issue and this decision is based upon those written submissions.

Issues:

The issue in this hearing is:

Pursuant to section 282(11) of the Insurance Act, is either party liable to pay the opposing party’s expenses in respect of the arbitration proceeding?

Result:

The Applicant is liable to pay to the Insurer its expenses in respect of the arbitration proceeding, fixed in the amount of $15,000.00 (inclusive of fees, disbursements and any applicable taxes).

EVIDENCE AND ANALYSIS:

Position of the Parties

The Insurer takes the position that it was almost entirely successful in defending this application and, as a result, it ought to be awarded its reasonable expenses of this proceeding. It is seeking total expenses of approximately $32,000 (inclusive of HST).

The Applicant takes the position that success was divided and that he should therefore be awarded half of his reasonable expenses – i.e., about $17,000). This represents one-half of his total expenses in the amount of approximately $34,000, based on fees of about $11,000 inclusive of HST (about 26 hours of attendance at the hearing and about 60 hours of preparation and other services¹) and disbursements of about $23,000.

Entitlement to Expenses

Of the criteria I am permitted to consider, the only one that seems relevant in this case, and the only one explicitly relied upon by the parties, is each party’s degree of success.

The Applicant’s claims were potentially worth hundreds of thousands of dollars. Ultimately, all but one of the Applicant’s claims were dismissed and the one claim where the Applicant was successful was worth about $1,500 (not including interest). The Applicant also achieved a “moral” victory (if not a financial one) in convincing me that the treatment being recommended by Dr. Connell in his plan of September 26, 2012 was not “experimental in nature”; nevertheless, based upon the evidence that was properly before me, I accepted the opinion of the Insurer’s expert, Dr. Walsh, that it was impossible to determine whether the recommended treatment was reasonable and necessary until valid neuropsychological test results were obtained.²

It is obvious that the Insurer was almost entirely successful in the current arbitration proceeding. On this basis, the Insurer is entitled to its reasonable expenses related to this proceeding. Nevertheless, I am cognizant that the Applicant had some small measure of success in this proceeding and I will consider that when exercising my discretion in determining the appropriate quantum of expenses.

Quantum

Fees

The oral hearing lasted four days. There were only three witnesses: the Applicant, Dr. Connell and an occupational therapist, Nir Tamir. The Insurer called no witnesses but relied upon surveillance, expert reports and upon its cross-examination of the Applicant and his two expert witnesses. This was neither the simplest nor the most complex of cases. It turned largely upon my assessment of the credibility of the Applicant, his failure to disclose important information and the lack of corroborating and supporting evidence.³

The Insurer is seeking fees of about $31,000. This is based on approximately 33 hours’ attendance at the hearing, 10 hours for written submissions and 157 hours for preparation for the hearing and other services – a total of about 200 hours of legal services, virtually all provided by Mr. Blouin.

Based upon the nature of this case, the numbers of hours spent on the case by Applicant’s counsel (about 86 hours) and the length of the hearing, I find the number of hours of legal services claimed on behalf of the Insurer to be greater than can reasonably be permitted in this case. My notes indicate that the hearing lasted about 28 hours. Allowing for preparation time to hearing time at a ratio of 2:1, plus adding in some time for preparing a Response and preparing for and attending the pre-hearing discussion, I find that a more reasonable number of hours for counsel to have spent on this file would be about 100 hours.

At the appropriate Civil Tariff Legal Aid rates that were in place at the time the services were provided, 100 hours of legal services by Mr. Blouin (plus HST) represents fees of about $14,600. Given that the Applicant was not entirely unsuccessful, however, I find it reasonable to reduce this amount to $13,600.

Disbursements

A party to an arbitration proceeding at FSCO is only permitted to seek compensation for expenses of a type and in an amount permitted under the Expense Regulation. The Insurer produced a list of disbursements that total a bit less than $1,400. The Applicant has not opposed or challenged any of these disbursements. The nature and amount of each of these disbursements is permissible under the Expense Regulation. I find the amount claimed by the Insurer for disbursements to be reasonable. I shall therefore grant the disbursements claimed by the Insurer.

CONCLUSION:

Having considered the degree of success of each party, the duration of the hearing, the relative complexity of this matter, the reasonable amount of legal services that can be claimed, the applicable Legal Aid rates, the written submissions of the parties, the supporting documentation filed and the maximum amounts permitted under the Expense Regulation, for the reasons set out above, I find it appropriate to fix the Insurer's expenses at $15,000.00 (inclusive of all fees, disbursements and any applicable taxes) and to order the Applicant to pay this amount to the Insurer.

February 17, 2016

Richard Feldman Arbitrator

Date