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Neutral Citation: 2019 ONFSCDRS 34

Appeal P17-00050

OFFICE OF THE DIRECTOR OF ARBITRATIONS

CAROLYN MOONEY Appellant

and

WAWANESA MUTUAL INSURANCE COMPANY Respondent

BEFORE: David Evans

REPRESENTATIVES: Leonard H. Kunka for Ms. Mooney Katherine E. Kolnhofer for Wawanesa Mutual Insurance Company

HEARING DATE: On the Record, with submissions received by May 10, 2019

APPEAL EXPENSES ORDER

Under section 283 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, R.R.O. 1990, as amended, it is ordered that:

Each party will bear their own legal expenses of the appeal.

June 21, 2019

David Evans Director’s Delegate

Date

REASONS FOR DECISION

In a decision dated February 26, 2016, Arbitrator Huberman awarded Ms. Mooney accident benefits. He then issued his expenses and interest decision on June 26, 2017, finding Ms. Mooney entitled to expenses incurred in respect of that arbitration, including the hearing on expenses, in the total amount of $67,688.74. He did not grant her solicitor/client costs or the full amount of expenses claimed pursuant to the Expense Regulation. He also denied any further interest was owing for accident benefits he had awarded pursuant to the SABS–1996.¹

In a decision dated February 13, 2019, I dismissed Ms. Mooney’s appeal of Arbitrator Huberman’s expenses and interest decision.

Wawanesa now seeks its legal expenses – not only expenses of the appeal before me but also of the Arbitrator’s expense hearing.

Because of Wawanesa’s overreach in this claim, as set out below, I award it nothing.

First, I ordered a party could seek an order of legal appeal expenses, not of arbitration expenses.

Second, the Arbitrator already ordered expenses of the hearing on expenses, as seen in his order:

The Applicant is entitled to expenses incurred in respect of this Arbitration, including the Hearing on Expenses, in the total amount of $67,688.74… [Emphasis added.]

Further, at p. 14, he wrote:

Based on the evidence before me, I find that a reasonable number of total hours for all legal services in respect of this Arbitration proceeding, including the Hearing on Expenses, but excluding Hearing time, is 157.62 hours. [Emphasis added.]

Therefore, I have no jurisdiction to deal with those expenses.

Third, Wawanesa claims an hourly rate for senior counsel of $150. However, Rule 76.1 of the Dispute Resolution Practice Code provides that an hourly rate up to $150 may be awarded “where an adjudicator is satisfied that a higher amount for legal fees to an insured person is justified.”

Wawanesa is not an insured person and cannot claim that maximum amount: see Hughes and Allstate Insurance Company of Canada (FSCO A99-000961, April 2, 2002) and Thevaranjan and Personal Insurance Company of Canada (FSCO P11-00016, February 5, 2013), among many others confirming that point.

Fourth, about $11,500 of the $24,000 in disbursements is for the transcripts and court reporter. As I stated in Kingsway General Insurance Company and Pereira (FSCO P05-00031, September 17, 2007), transcript costs are not recoverable. Rule 74.3 provides that, where a party orders all or a portion of the transcript of a proceeding, the party must directly pay the person or agency providing the transcript. There is no specific provision that the expense can be reclaimed, unlike filing fees, and the transcript and reporting expense does not fit in the “other out-of-pocket” expenses category in s. 4.4 of the Schedule to the Expense Regulation. The fact that no caps are placed on expenses for court reporters or transcripts, although they may add up to thousands of dollars, suggests that transcripts are not meant to be recoverable as expenses. Thus, in Yogesvaran and State Farm Mutual Automobile Insurance Company (FSCO P17‑00086, October 5, 2018), I overturned an award of the transcript expenses.

Furthermore, in Bharat and Bharat and State Farm Automobile Insurance Company (FSCO P17‑00047 and P17-00048, March 7, 2019), the successful appellants sought their appeal expenses, including the costs of the transcript they ordered of almost $3000. Ms. Kolnhofer was on the record for State Farm, as she was in this case (although Ms. Brenda Cuneo of the same law firm attended at the main hearing).² In any event, these were the submissions from the insurer in Bharat about the transcript costs:

Rule 74.3 of the Code provides that, where a party orders all or a portion of the transcript of a proceeding, the party must directly pay the person or agency providing the transcript. Further, the case law has confirmed that transcripts are not recoverable.

A footnote then pointed to Mr. C. and Kingsway General Insurance Company (FSCO A04‑001815, August 27, 2009), a case that in turn cited Pereira.

Accordingly, the law on transcript expenses was well known to the Insurer and its counsel.

Criterion (e) under Rule 75, Award of Expenses of the Dispute Resolution Practice Code, allows me, when determining expenses, to consider “whether any aspect of the proceeding was improper, vexatious or unnecessary.” In this case, Wawanesa sought expenses that had already been determined and not appealed and over which I had no jurisdiction. Further, it sought payment for items that are not payable under the Expense Regulation, items that totalled nearly 80 percent of the entire amount claimed.

In all those circumstances, I find Wawanesa’s submissions improper and vexatious.

Accordingly, each party will bear their own expenses of the appeal.