Marc Ramalho v. State Farm Mutual Automobile Insurance Company, 2017 ONFSCDRS 172

Financial Services Commission des

Commission services financiers

of Ontario de l’Ontario

Neutral Citation: 2017 ONFSCDRS 172

FSCO A15-008592

BETWEEN:

MARC RAMALHO

Applicant

and

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY

Insurer

REASONS FOR DECISION

Before:

Arbitrator Paulina Gueller

Heard:

In person at ADR Chambers on May 31, 2017

Appearances:

Mr. Justin Mariani represented Mr. Marc Ramalho

Ms. Yasna Beheshti represented State Farm Mutual Automobile Insurance Company

Mr. Jeff Kope participated on behalf of State Farm Mutual Automobile Insurance Company

Issues:

The Applicant, Mr. Marc Ramalho, was injured in a motor vehicle accident on November 26, 2012, and sought accident benefits from State Farm Mutual Automobile Insurance Company (“State Farm”), payable under the Schedule. ¹ The parties were unable to resolve their disputes through mediation, and Mr. Ramalho, through his representative, applied for arbitration at the Financial Services Commission of Ontario (“FSCO”) under the Insurance Act, R.S.O. 1990, c. I.8, as amended.

The issues in this Hearing are:

Should Zarolia Barristers Professional Corporation be removed from the record as Mr. Ramalho’s counsel?
Should Mr. Ramalho’s Application for Arbitration be dismissed?
Is State Farm entitled to its expenses of this proceeding?

Result:

I allow Zarolia Barristers Professional Corporation to be removed from the record as Mr. Ramalho’s counsel.
Mr. Ramalho’s Application for Arbitration is dismissed.
State Farm is entitled to its expenses of this Arbitration proceeding in the amount of $1,500.00, inclusive of all fees and HST.

EVIDENCE AND ANALYSIS:

Motion to be removed from the record as the Applicant’s Counsel

Zarolia Barristers Professional Corporation brought a Motion to be removed from the record on April 26, 2017. At that time, the Pre-Hearing Arbitrator did not allow it.

At the commencement of the Hearing, Mr. Mariani submitted that Zarolia Barristers Professional Corporation was unable to obtain instructions from its client; consequently, there was a breakdown in the client-lawyer relationship. Therefore, Mr. Mariani requested Zarolia Barristers Professional Corporation to be removed from the record as the Applicant’s counsel.

The Insurer did not oppose.

Accordingly, upon reading the Applicant’s counsel’s Motion material, and on hearing submissions of the parties, I accept Zarolia Barristers Professional Corporation submissions that there was a breakdown in the client-lawyer relationship, and I allow Zarolia Barristers Professional Corporation to be removed as counsel of record for the Applicant.

Dismissal

Mr. Ramalho did not appear at the Hearing; therefore, we broke for 30 minutes to allow Mr. Ramalho time to attend. After the Hearing resumed, the Insurer brought a Motion to dismiss the Application for Arbitration.

Mr. Ramalho submitted an Application for Arbitration on November 30, 2015.

Mr. Ramalho attended a Pre-Hearing on June 18, 2016; however, he failed to attend three Pre-Hearings held on April 28, 2016 and December 15, 2016, and April 28, 2017.

The Insurer submitted that the Applicant has showed disregard for the process as he failed to attend three Pre-Hearings; instruct his counsel; and attend today’s Hearing.

Rule 37.9 of the Dispute Resolution Practice Code (“DRPC”) states:

Where notice of hearing has been sent to a party and a party does not attend at an oral or electronic hearing, or participate in a written hearing, the arbitrator may proceed with the hearing in the party’s absence or without the party's participation, as the case may be, and the party is not entitled to any further notice in the proceeding.

I am satisfied that the notices sent to Mr. Ramalho’s complied with the requirements of Rule 9.1(c) of the DRPC and Section 6 of the Statutory Power and Procedures Act. Notwithstanding, Mr. Ramalho did not attend any of the three Pre-Hearings or the Hearing.

Pursuant to Rule 37.9 of the DRPC, the Arbitration Hearing proceeded in Mr. Ramalho’s absence.

Mr. Ramalho’s bears the onus of proving entitlement to the claimed benefits. Since he did not appear at the Hearing and no evidence was presented to support his claims, this Application for Arbitration is dismissed.

EXPENSES:

State Farm requested the costs of the Arbitration process, but did not provide a Bill of Costs. Ms. Beheshti stated that the claim for fees and disbursements would be in the amount of $5,600.00 for legal fees. The Insurer advised that there was no claim for disbursements.

Ms. Beheshti explained that the calculation was done based on 22 hours of legal work, 3 hours of preparation, attending three Pre-Hearings, and attending the Hearing, at the rate of $150.00 per hour.

The relevant criteria for the Arbitrator when awarding expenses to a party, if the adjudicator is satisfied that the award of expenses is justified, is set out in Rule 75.1 and 75.2 of the DRPC as follows:

The adjudicator will consider only the criteria referred to in the Expense Regulation found in Section F of the Code. These criteria are:

(a) each party's degree of success in the outcome of the proceeding;

(d) the conduct of a party or a party's representative that tended to prolong, obstruct or hinder the proceeding, including a failure to comply with undertakings and orders;

(e) whether any aspect of the proceeding was improper, vexatious or unnecessary.

In awarding expenses, I am taking into consideration the relevant criteria, which include the party’s success in the proceedings and the conduct of the party that prolonged the proceeding unnecessarily. Mr. Ramalho failed to pursue his claim, instruct his counsel and failed to attend 3 Pre-Hearings and the Hearing.

State Farm is the successful party and is entitled to its expenses. I consider the time that State Farm’s counsel spent preparing responses to the Application for Arbitration, consulting with its client, and preparing for and attending three Pre-Hearings and the Hearing. However, State Farm was aware that Mr. Ramalho, most likely, would not pursue his Arbitration.

Therefore, I find it is reasonable to grant some legal expenses. Accordingly, I exercise my discretion pursuant to subsection 282(11) of the Insurance Act, and order Mr. Ramalho pay State Farm expenses in the amount of $1,500.00, inclusive of all fees and HST.

This amount is payable forthwith.

June 19, 2017

Paulina Gueller

Arbitrator

Date