Anthonidas Aloysius v. Royal & SunAlliance Insurance Company of Canada, 2019 ONFSCDRS 28

Financial Services Commission des Commission services financiers of Ontario de l’Ontario

Neutral Citation: 2019 ONFSCDRS 28

FSCO A12-003310 A12-003311 A12-005353

BETWEEN:

ANTHONIDAS ALOYSIUS

Applicant

and

ROYAL & SUNALLIANCE INSURANCE COMPANY OF CANADA

Insurer

DECISION ON EXPENSES

Before: Anne Sone

Heard: By written submissions and teleconference calls. Final written submissions were received on March 22, 2019.

Appearances: David Wilson for Mr. Aloysius Jonathan Schrieder for Royal & SunAlliance Insurance Company of Canada

Overview:

The Applicant, Anthonidas Aloysius, was injured as a result of three motor vehicle accidents that took place on January 31, 2003, (“the 2003 accident”), December 10, 2005, (“the 2005 accident”) and May 8, 2006 (“the 2006 accident”). He applied for benefits from Royal & SunAlliance Insurance Company of Canada (“Royal”), payable under the Schedule. ¹ In a decision dated September 30, 2015, Arbitrator Mutch dealt with his claims for statutory accident benefits under the Schedule.

Issues:

Arbitrator Mutch noted that the following issues were raised in the hearing before him:

A. Procedural issues:

1. Royal alleges that it has a section 32 defense in regard to the following:

· the claim for housekeeping benefits post-104 weeks arising from the 2003 accident;

· the claim for all housekeeping benefit claims arising from the 2006 accident;

· the claim for attendant care benefits arising from the 2003, 2005 and 2006 accidents.

2. Royal alleges that it has a limitation defense in regard to the following:

· the claim for housekeeping benefits arising from the 2005 accident;

· the claims for attendant care benefits arising from the 2003 and 2006 accidents.

B. Substantive Issues

1. Has Mr. Aloysius sustained a catastrophic impairment as the result of any one of the accidents referred to above?

2. Is Mr. Aloysius entitled to attendant care benefits at the rate of $481.60 per month from January 31, 2003 to date and ongoing, $527.65 per month from December 10, 2005, to date and ongoing and $571.30 per month from May 8, 2006, to date and ongoing?

3. Is Mr. Aloysius entitled to benefits for housekeeping and home maintenance from February 1, 2005 to date and ongoing? If not, is he entitled to same from the date of the second accident, December 10, 2005 to date and ongoing? If not, is he entitled to same from the date of the third accident, May 8, 2006 to date and ongoing?

4. Is the treatment plan dated June 22, 2012 by Dr. T. Hoff, in the amount of $1,852.00 reasonable and necessary?

5. Is Royal liable to pay a special award because it unreasonably withheld or delayed payments to Mr. Aloysius?

6. Is Royal liable to pay Mr. Aloysius’ expenses in respect of the arbitration?

7. Is Mr. Aloysius liable to pay Royal’s expenses in respect of the arbitration?

8. Is Mr. Aloysius entitled to interest for the overdue payment of benefits?

Results in Arbitrator Mutch’s Decision

Arbitrator Mutch made the following orders, while reserving on the issue of expenses:

Result regarding Procedural Issues:

The attendant care and housekeeping claims arising out of the 2005 and 2006 accidents are denied either because of failure to comply with section 32 or with the limitation periods.

The only issues to be determined are those arising from the 2003 accident: the attendant care benefits and housekeeping claim post 104 weeks.

Result regarding Substantive Issues:

1. Mr. Aloysius has sustained a catastrophic impairment as a result of the 2003 accident.

2. Mr. Aloysius is not entitled to attendant care benefits.

3. Mr. Aloysius is entitled to housekeeping and home maintenance benefits from February 1, 2005 in the amounts claimed, to date and ongoing.

4. Mr. Aloysius is not entitled to a medical benefit in the amount of $1,852 as set out in the treatment plan of Dr. T. Hoff dated June 22, 2012.

5. Mr. Aloysius is not entitled to a special award.

6. If the parties cannot agree on entitlement to, or the amount of expenses of the proceeding they may request an appointment to determine expenses in accordance with Rule 79.1 of the Dispute Resolution Practice Code.

7. Royal shall pay Mr. Aloysius interest on any outstanding amounts according to the terms of the Schedule.

Results of Appeal:

Arbitrator Mutch’s decision was appealed, and Director’s Delegate Lee ordered that:

1. Mr. Aloysius is not entitled to attendant care benefits arising from the accident of January 31, 2003.

2. The claims for attendant care benefits arising from the accidents of December 10, 2005 and May 8, 2006 are not barred by the operation of section 32 of the Schedule.

3. These issues, if re-heard, must be re-heard by an arbitrator other than Arbitrator Mutch.

The decision regarding re-heard issues has not yet been rendered.

Issue Dealt with in this Decision:

The issue in this further hearing is:

1. Is Mr. Aloysius or Royal entitled to expenses incurred in respect of this arbitration hearing, and if so, in what amount?

Result:

1. Mr. Aloysius is entitled to his expenses incurred in respect of this arbitration in the amount of $46,890.88, inclusive of fees, disbursements and H.S.T.

EVIDENCE AND ANALYSIS:

Entitlement to Expenses:

Pursuant to subsection 282(11) of the Insurance Act:

The Arbitrator may award, according to criteria prescribed by the regulations, to the insured person or the insurer all or part of such expenses incurred in respect of an Arbitration proceeding as may be prescribed in the regulations, to the maximum set out in the regulations.

The criteria an adjudicator shall consider when deciding whether to award expenses are found in Ontario Regulation 664,² in Rule 75.2 and Section F of the Dispute Resolution Practice Code (Fourth Edition — Updated January 2014). I will discuss each of these criteria in order.

(a) Each party’s degree of success in the outcome of the proceeding:

In the hearing before Arbitrator Mutch, Mr. Aloysius was successful in his claim that he sustained a catastrophic impairment as a result of the 2003 accident. He was also found to be entitled to a housekeeping and home maintenance benefit. His claim for attendant care benefits for each accident was dismissed; however, on appeal, it was ordered that his claim for attendant care benefits arising out of the 2005 and the 2006 accidents could be re-heard. In addition, his claims for Dr. Hoff’s treatment plan in the amount of $1,852 and for a special award were dismissed.

Although success in this matter was mixed, I find that overall, Mr. Aloysius was more successful than Royal. Since the Arbitrator found Mr. Aloysius was catastrophically impaired as a result of the 2003 accident, whether Mr. Aloysius was catastrophically impaired from the 2005 or 2006 accidents became moot. In addition, the dollar value of Mr. Aloysius’ housekeeping claim has exceeded $300,000 to date.

(b) Any written offers to settle made in accordance with Rule 76:

There were no written offers to settle made in accordance with Rule 76.

(c) Whether novel issues are raised in the proceeding:

Although the case was complex due to the number of accidents and issues, I find that there were no novel issues raised in this proceeding.

(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:

Not applicable to this proceeding.

(e) Whether any aspect of the proceeding was improper, vexatious or unnecessary:

Not applicable to this proceeding.

(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.

Not applicable to this proceeding.

(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 Schedule — 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.

Not applicable to this proceeding.

Conclusion regarding Entitlement to Expenses:

Royal submitted that the parties enjoyed divided success overall, and that they should each bear their own expenses.

Based on the above analysis, and the finding that Mr. Aloysius was more successful than Royal, I find that Mr. Aloysius is entitled to a portion of his expenses of this proceeding.

Amount of Expenses:

Statutory Framework:

The amount of expenses I may award is set out in section 3 of the Schedule to the Expense Regulation (Dispute Resolution Expenses) pursuant to subsection 282(11) of the Insurance Act. It states as follows:

3(1) The legal fees payable by the insured person or the insurer for the following matters may be awarded:

1. For all services performed before an arbitration, appeal, variation or revocation hearing.

2. For the preparation for an arbitration, appeal, variation or revocation hearing.

3. For attendance at an arbitration, appeal, variation or revocation hearing.

4. For services subsequent to an arbitration, appeal, variation or revocation hearing.

3(2) The number of hours for which legal fees may be awarded shall be determined by the arbitrator, having regard to the criteria set out in subsection 12(2) of this Regulation.

3(3) The maximum amount that may be awarded for legal fees is the amount calculated using the hourly rates set out in the Dispute Resolution Practice Code published by the Ontario Insurance Commission or the Financial Services Commission of Ontario, as it may be amended from time to time.

Mr. Aloysius’ Claim for Expenses:

In his Bill of Costs, Mr. Aloysius claimed $37,451.03, including H.S.T., for fees and $25,493.20, including H.S.T., for disbursements.

Analysis and Findings:

Fees:

In terms of the hearing time, Arbitrator Makepeace confirmed in Henri and Allstate Insurance Company of Canada,³ that “a line-by-line assessment of the expenses claimed is not appropriate. Rather, the Arbitrator should make a global assessment of reasonable expenses.”

Therefore, the overriding consideration in fixing arbitration expenses for legal fees is reasonableness.

As a rule of thumb, Arbitrators have allowed expenses for preparation for hearing time to the actual hearing time on a ratio of between 1:1 and 4:1.

The hearing in this case took place over five days. Mr. Aloysius has claimed 42.95 hours of hearing time for the initial hearing. I have reduced this by five hours of travel time which was claimed, and is not allowed under the Expense Regulation. I have allowed an additional 1.5 hours of hearing time for the expense hearing. This results in a total of 39.45 hours.

Mr. Aloysius has asked for a ratio of 3:1 for preparation for hearing time to the actual hearing time. With three accidents and numerous issues, this was a complex case. Accordingly, I agree that a ratio of 3:1 is justified in this case. At Mr. Aloysius’ counsel’s hourly rate of $150 per hour, this results in a total of $23,670.

Since there was mixed success in this matter, I am reducing this amount by a factor of 20%, which leaves a total of $18,936. When HST is added to this amount, the total is $21,397.68, which I find is the appropriate amount for Mr. Aloysius’ fees, inclusive of HST in this case.

Disbursements:

I find that the disbursements Mr. Aloysius has requested, totaling $25,493.20, including H.S.T., are in accordance with the Expense Regulation, and therefore payable.

Conclusion:

For the reasons set out above, I order Royal to pay Mr. Aloysius his expenses in respect of this arbitration proceeding, fixed at $46,890.88, inclusive of fees, disbursements and H.S.T.

May 31, 2019

Anne Sone Arbitrator

Date

Financial Services Commission des Commission services financiers of Ontario de l’Ontario

Neutral Citation: 2019 ONFSCDRS 28

FSCO A12-003310 A12-003311 A12-005353

BETWEEN:

ANTHONIDAS ALOYSIUS

Applicant

and

ROYAL & SUNALLIANCE INSURANCE COMPANY OF CANADA

Insurer

ARBITRATION ORDER

Under section 282 of the Insurance Act, R.S.O. 1990 c. I.8 as it read immediately before being amended by Schedule 3 to the Fighting Fraud and Reducing Automobile Insurance Rates Act, 2014, and Regulation 664, as amended, it is ordered that:

1. Royal & SunAlliance Insurance Company of Canada pay Mr. Aloysius his expenses in the amount of $46,890.88, inclusive of fees, disbursements and H.S.T.

May 31, 2019

Anne Sone Arbitrator

Date

Footnotes

1. 1The Statutory Accident Benefits Schedule — Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.
2. 2Schedule to R.R.O. 1990, Reg. 664, made under section 282(11) of the Insurance Act, as amended.
3. 3(OIC A-007954, August 8, 1997).