Financial Services Commission of Ontario Commission des services financiers de l’Ontario
Neutral Citation: 2017 ONFSCDRS 48
FSCO A14-009210
BETWEEN:
PAUL TAUSCHEK
Applicant
and
TD GENERAL INSURANCE COMPANY
Insurer
DECISION ON EXPENSES
Before: Arbitrator Charles Matheson
Heard: By written submissions completed on December 19, 2016
Appearances: Ms. Emily Foreman, lawyer, particpated for Mr. Paul Tauschek
Mr. Michael Kennedy, lawyer, participated for TD General Insurance Company
Issues:
The Applicant, Mr. Paul Tauschek, was injured in a motor vehicle accident on August 25, 2012. He applied for and received statutory accident benefits from TD General Insurance Company (“TD”), payable under the Schedule.1 The parties were unable to resolve their disputes through mediation, and Mr. Tauschek applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c. I.8, as amended.
The issues in this Expense Hearing are:
Which party is liable for the other party’s legal expenses in respect of the Arbitration?
Which party is liable for the other party’s legal expenses in respect of this Expense Hearing?
If awarded, what is the quantum of the expenses awarded for the Expense Hearing?
Result:
Mr. Tauschek is liable to pay the legal expenses of TD for the preparation of the Arbitration in the fixed amount of $1,300.00, inclusive of disbursements and taxes.
The parties are liable for their own legal expenses for this Expense Hearing.
EVIDENCE AND ANALYSIS:
Legislation and Case Law considered
Insurance Act, R.S.O. 1990, c. I.8, s. 282(11)
Dispute Resolution Practice Code, Fourth Edition, January 2014, Rules 75 and 76
Fedoseev and RBC General Insurance Company, FSCO A05 B 002435
Girao and Allstate Insurance Company of Canada, FSCO A07-000288
Khan and State Farm Mutual Automobile Insurance Company, FSCO A13-014868
Abdukadirov and TD General Insurance Company, FSCO A14-001104
Background
At the time of the accident, the Applicant was employed as an airline pilot. Both the Applicant and his wife were injured in the August 25, 2012 accident. Both Mr. and Mrs. Tauschek’s accident benefit Applications for Arbitration were related by FSCO and a date for the Arbitration for both applications was scheduled for November 1-3, 2016, at the same Pre-Hearing. Subsequently, Mrs. Tauschek was further injured in a second accident in 2015, which was outside the jurisdiction of the original Pre-Hearing Arbitrator. Both files settled prior to a Hearing. The parties were unable to agree as to the expenses of Mr. Tauschek’s Arbitration. Mr. Tauschek was, in part, claiming an Income Replacement Benefit (“IRB”).
Decision
Arguments
Insurer’s counsel argues, in part, that the Applicant and/or his legal representative prevented the settlement of this file, thus prolonging the dispute resolution process, which in turn made the Insurer incur added costs needlessly. On November 17, 2015, after the first Pre-Hearing of October 1, 2015, the Insurer served the Applicant with its offer of settlement, which went unanswered until September 26, 2016.
Applicant’s counsel argues, in part, that the Applicant’s case was tied directly with his wife’s case, including the tort actions. Applicant’s counsel suggests that this file was progressing well as the employment file was received in late March 2016, until the Applicant underwent an unplanned open heart surgery on April 24, 2016, and was not available until September 23, 2016, where the Applicant gave counsel instructions for the withdrawal of the Application for Arbitration. Applicant’s counsel, on the next work day (September 26, 2016), made the offer to withdraw the Application for Arbitration without costs. Applicant’s counsel notes that the related wife’s file did not settle until mid-October 2016, a few weeks before the Arbitration, and three or more weeks after the Applicant authorized the withdrawal of this Application for Arbitration.
Applicant’s counsel argues that the Insurer should pay their legal costs, for its role in preventing a quick resolution of this Application for Arbitration by bringing this Expense Hearing to its full conclusion. Further, the Applicant argues that the Insurer is engaged in an “unfair or deceptive act or practice” pursuant to the “Unfair or Deceptive Acts or Practices” under the [Insurance Act](https://www.canlii.org/en/on/laws/stat/rso-1990-