Neutral Citation: 2018 ONFSCDRS 90

FSCO A12-006873

BETWEEN:

ROBERT MACLEOD Applicant

and

COACHMAN INSURANCE COMPANY Insurer

DECISION ON EXPENSES

Before: Arbitrator Anne Morris

Heard: By written submissions completed on April 3, 2018

Appearances:

Mr. Luke Hamer and Mr. Chris Jackson for Mr. MacLeod Mr. Jamie Pollack and Ms. Stacey Morrow for Coachman Insurance Company

Issues:

The Applicant, Robert MacLeod (the “Applicant” or “Mr. MacLeod”), was injured in a motor vehicle accident on September 13, 2010 and sought accident benefits from Coachman Insurance Company (the “Insurer” or “Coachman”), payable under the Schedule.¹ The parties were unable to resolve their disputes through mediation, and Mr. MacLeod, through his representative, applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c. I.8, as amended.

The issue in this Expense Hearing is:

Is either party entitled to its expenses of the Arbitration and, if so, in what amount?

Result:

The Applicant is entitled to his expenses of the Arbitration (including the Expense Hearing) in the amount of $48,597.95, inclusive of fees, disbursements and HST.

EVIDENCE AND ANALYSIS:

The Arbitration Hearing was held before me on September 26, 27, 28, 29, 2017 and on October 20, 2017, and by written submissions completed on November 17, 2017. My decision was as follows:

Mr. MacLeod is entitled to receive a non-earner benefit in the amount of $185.00 per week from 26 weeks post-accident to date and ongoing.
Mr. MacLeod is entitled to housekeeping and home maintenance services at the rate of $45.00 per week from September 13, 2010 to August 31, 2012 and at the rate of $90.00 per week from September 1, 2012 to date and ongoing.
Mr. MacLeod is entitled to attendant care benefits, over and above what has already been paid by Coachman, in the amount of $673.51 per month from September 13, 2010 to December 13, 2010 and $361.22 per month from December 14, 2010 to August 14, 2012.
Coachman is not liable to pay a special award.
Mr. MacLeod is entitled to interest for the overdue payment of benefits in accordance with the Schedule.
If the parties are unable to agree on the entitlement to, or quantum of, the expenses of this matter, the parties may request an appointment with me for determination of same in accordance with Rules 75 to 79 of the Dispute Resolution Practice Code.

The parties were unable to resolve the issue of expenses and an Expense Hearing by way of written submissions was scheduled before me.

Authority to Award Expenses

Rule 75.1 of the Dispute Resolution Practice Code (the “Code”) provides that:

An adjudicator may award expenses to a party if the adjudicator is satisfied that the award is justified having regard to the criteria set out in Rule 75.2. The items and amounts which may be awarded are in Rule 78 and the Schedule to the Expense Regulation found in Section F of the Code.

Rule 75.2 of the Code, which sets out the criteria to be considered in awarding expenses, states the following:

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;

b. Any written offers to settle made in accordance with Rule 76;

c. Whether novel issues are raised in the proceedings;

d. The conduct of a party or 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;

f. Whether the insured person refused or failed to submit to an examination as required under section 42 of Ontario Regulation 403/96 (Statutory Accident Benefits Schedule – Accidents on or after November 1, 1996) made under the Act or refused or failed to provide any material required to be provided by subsection 42(10) of that regulation; and

g. Whether the insured person refused or failed to submit to an examination as required under section 44 of Ontario Regulation 34/10 (Statutory Accident Benefits – Effective September 1, 2010), made under the Act, or refused or failed to provide any material required to be provided under subsection 44(9) of that regulation.

Criteria

The only criterion referenced in the parties’ submissions was degree of success. The Insurer submitted that the degree of success was mixed and that the parties should therefore bear their own expenses. Overall, however, the Applicant had significant success, receiving benefits as a direct result of the Hearing, even if he was not awarded all that he claimed. I find that he is entitled to his expenses of the Hearing having regard to, in addition to his success, the contractual first party insurer relationship between the parties, the consumer protection nature of the legislation and the issue of reasonable access to the dispute resolution process.

The Applicant claims $27,405.03 plus HST for legal fees and $68,568.50 plus HST plus disbursements for a total including HST of $105,675.15. This amount seems excessive. It is established case law that the overriding consideration in fixing legal expenses is reasonableness.² A line-by-line assessment of the expenses claimed is not required.³ The task involves taking a pragmatic, broad-strokes approach with a view to fixing an amount that is reasonable.

The Hearing took place over five days. In my view, a ratio of 3:1 preparation time to hearing time is reasonable in all of the circumstances of this case. I will allow seven hours per day or 35 hours for hearing time and a further 105 hours for preparation time for a total of 140 hours. I will allow for the lawyer’s time at Mr. Hamer’s legal aid rate of $122.78 for a total of $17,189.20. I will also allow 140 hours of law clerk time including for Mr. Jackson at the rate of $32.37 per hour or $4,531.80 for a total of $21,721.00 in legal fees. The total for legal fees with HST is $24,544.73.

The list of disbursements is lengthy. I will allow $100.00 for the filing fee. The total amount for various records (288 +73.40+168+632+63.50+480+381.50+450+254.25+50+50) is $2,890.65 Noting that there was also a tort claim for which these records would have been used, I will allow one half of this amount or $1,445.33 The $26.59 for “expense recovery for case conference” does not appear to be related to this arbitration and is not allowed. The Applicant claimed $4,000.00 each for the reports of Dr. Van Reekum, Dr. Fulton, and Dr. Jacobs. The Applicant also claimed $2,280.00 for a report by Ross Rehabilitation, $2,000.00 for DMA Reliability, $2,000.00 for a capacity assessment, and $1,448.96 for a capacity assessment, for a total for expert reports of $19,728.96. These amounts are beyond the maximums allowed in the Expense Regulation, and in some cases beyond the maximum charged. I agree with the Insurer’s submission in this regard that the maximum allowable is $10,524.00.

The Applicant claimed for witness fees preparation and attendance at the Hearing as follows: $3,240.00 for Dr. Fulton, $1,874.95 total for Joyce Sharpe, $770.00 for Entwistle Power, $4,953.00 total for Asma Malik, a total of $6,401.40 for Dr. Jacobs, $757.09 for Dube Court Rehabilitation, $4,000.50 for Dr. Reekum, and $257.48 for witness fees for a total claimed of $22,254.42. I agree with the Insurer that these amounts exceed what is allowed by the Expense Regulation. I am persuaded by the Insurer that the appropriate total amount for these expenses having regard to the limits for preparation and attendance is $8,233.68 and I allow that amount.

The Applicant has charged a total of $2,632.30 (1,158.28+1,429.81+44.21) for taxi, mileage and 407 charges. I agree with the Insurer that the Applicant has not discharged the burden of proof that these expenses were incurred in accordance with the Expense Regulation in furtherance of the arbitration. I will allow $400.00 as a reasonable total amount for non-local travel. I will allow $5.00 for the Brantford police report.

The Applicant claimed the following in relation to an application for guardianship: $181.00 for the issuance of an application and $13,203.79 paid for fees and disbursements. The application for guardianship is generally in relation to all of the property of the Applicant. It is not provided for under the Expense Regulation and cannot properly be considered an out of pocket expense within the parameters of that regulation. The expense is not allowed.

I do not allow the $700.00 for police records as these were not relevant given the no-fault nature of the legislation. I do not allow $729.36 for a private mediation. Settlement facilities are available within the arbitration process. This is not an expense contemplated by the Expense Regulation. I do not allow the $1,325.00 for a medical illustration prepared by an art studio. It is not a medical record or report and does not fall within the parameters of the Expense Regulation.

I will allow $225.00 and $295.50 as reasonable for process serving. I will allow $500.00 as a reasonable amount for additional administrative expenses incurred in furtherance of the Hearing. I otherwise do not allow the amount of $126.00 paid to Minuteman Press, the $71.05 paid to Kwik Kopy, the $9.24 paid for a conference call, the $97.57 paid for courier services, the $1,502.57 for secured courier, the $750.00 for scanning, the $1,200.00 for photocopying, the $250.00 paid for postage, and the $200.00 paid for document binding. I do not allow the meal expense of $64.50.

The total allowed for disbursements is (100+1445.33+10,524+8233.68+400+5+225+295.50+500) $21,728.51 plus HST of $2,824.71 for a total of $24,553.22. The total therefore for fees and disbursements inclusive of HST is $24,544.73+$24,553.22 or $49,097.95. I reduce this amount by $500.00 in recognizing the added expense to the Insurer of analyzing excessive disbursements claimed without regard to the parameters of the Expense Regulation. The amount awarded to the Applicant for expenses then is $48,597.95.

EXPENSES:

The costs associated with the Expense Hearing are included in the general award of expenses above.

April 30, 2018

Anne Morris Arbitrator

Financial Services Commission of Ontario