Dispute Resolution Services de Règlement

Services des Différends

Neutral Citation: 2020 ONFSCDRS 7

A12-003310 A12-003311 A13-005353

BETWEEN:

ANTHONIDAS ALOYSIUS Applicant

and

ROYAL & SUNALLIANCE INSURANCE COMPANY OF CANADA Insurer

DECISION ON EXPENSES

Before: David Evans Heard: Written submissions received by April 13, 2020

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

Issues:

The Applicant, Anthonidas Aloysius, was injured in three motor vehicle accidents on January 31, 2003, December 10, 2005, and May 8, 2006. In two decisions, Arbitrator Anne Morris dealt with his claims for statutory accident benefits under the Schedule.¹ These decisions followed an earlier decision by another arbitrator and an appeal thereof, leading to a re-hearing. In her first re-hearing decision, dated February 10, 2020, Arbitrator Morris made the following orders:

1. The claim for catastrophic impairment arising from either or both of the 2005 and 2006 accidents is dismissed.

2. Attendant care benefits arising from the 2005 and 2006 accidents will be dealt with in a further decision, together with the other issues remaining in dispute, including expenses.

In her second decision, dated February 27, 2020, Arbitrator Morris made the following orders, while reserving on the amount of expenses:

1. Mr. Aloysius is not entitled to attendant care benefits arising from the accidents of December 10, 2005 and/or May 8, 2006.

2. Royal is not liable to pay a special award because it unreasonably withheld or delayed payments to Mr. Aloysius.

3. Mr. Aloysius is not entitled to interest for the overdue payment of benefits.

The issue in this further hearing is:

1. Is Royal & SunAlliance Insurance Company of Canada entitled to its expenses incurred in respect of this arbitration hearing?

Result:

1. Mr. Anthonidas Aloysius shall pay to Royal & SunAlliance Insurance Company of Canada $6,800 inclusive of HST for its legal fees and disbursements in this arbitration hearing.

EVIDENCE AND ANALYSIS:

This case has a long and complicated history.

Claims from all three accidents – 2003, 2005 and 2006 – initially came before Arbitrator Mutch. Mr. Aloysius claimed he was catastrophically impaired in the accidents and entitled to attendant care benefits, housekeeping and home maintenance benefits, a medical benefit, a special award and interest on outstanding benefits. The hearing lasted five days, four for evidence and one for submissions. Arbitrator Mutch rendered a decision September 30, 2015.

Arbitrator Mutch found Mr. Aloysius was catastrophically impaired by a mental or behavioural disorder because of the first 2003 accident. He therefore did not consider it necessary to determine whether Mr. Aloysius sustained a catastrophic impairment on the same grounds in the later accidents in 2005 and 2006.

Arbitrator Mutch found that the housekeeping and home maintenance benefits were payable from the two year point after the 2003 accident, but he found that the same benefits were barred by limitation periods regarding the later accidents.

Arbitrator Mutch dismissed the attendant care benefits with respect to the 2003 accident. He found those claims were barred by the operation of s. 32 of the Schedule for the later accidents.

Finally, Arbitrator Mutch denied a medical benefit for a treatment plan, dismissed the claim for a special award and awarded interest on the housekeeping and home maintenance benefits payable.

Both parties appealed. In his decision dated September 15, 2017, Delegate Lee confirmed the finding that while Mr. Aloysius was catastrophically impaired as a result of the 2003 accident, he was not entitled to attendant care benefits arising from it. However, Delegate Lee found that the attendant care claims arising from the later accidents were not so barred, so he returned those issues for a re-hearing. Delegate Lee also dismissed the Insurer’s cross-appeal with respect to the housekeeping and home maintenance benefits and interest and the determination of catastrophic impairment regarding the 2003 accident.

The expenses of the original arbitration hearing and of the appeal were determined after the re-hearing, which occurred in September 2018, but I will mention them first.

Arbitrator Sone determined the expenses of the initial arbitration hearing. In her decision dated May 31, 2019, she found the only relevant criterion was success, which largely went to Mr. Aloysius. She also found that although this was a complex case, it raised no novel issues. She allowed 37.95 hours for hearing time for the initial five-day hearing to Mr. Aloysius. She found a ratio of 3:1 for preparation for hearing time to the actual hearing time was justified, but reduced the overall fee due to the mixed success. She found the disbursements requested were within the Expense Regulation and therefore payable. She ordered Royal pay Mr. Aloysius $46,890.88, inclusive.

Delegate Lee determined the appeal expenses March 4, 2019. He noted that Mr. Aloysius was partially successful on his appeal and fully successful in the complicated cross-appeal brought by Royal. He rejected Mr. Aloysius’s claim of $6,437.26 as a disbursement for the transcript from the arbitration hearing because that expense is not specifically included in the Expense Regulation, citing my decision in Yogesvaran and State Farm Mutual Automobile Insurance Company, (FSCO P17-00086, December 20, 2018). He ordered Royal pay $5,750.00, inclusive.

The re-hearing of the matter came before Arbitrator Mervin on September 4, 5, 27, and 28, 2018. This was a shorter hearing than the first, consisting of two days of evidence and one and a half days of submissions. The only witness was Mr. Aloysius; although Royal served a number of summonses, in the end it called no witnesses. There were fewer issues and less documentation. For instance, the documentary evidence in the initial hearing consisted of 11 briefs filed by the insurer as well as the 2-volume brief filed by the insured. At the re-hearing, there was the 2-volume brief of the insured and 28 documents taken from the insurer’s 11 volumes.

Unfortunately, Arbitrator Mervin died before he was able to render a decision.

Arbitrator Morris was then assigned to render a decision. The parties agreed that she could make her decision based on the transcripts of the re-hearing.

In her first decision, Arbitrator Morris dealt with the issue of catastrophic impairment arising from either or both of the 2005 and 2006 accidents due to a mental or behavioural impairment. However, as she noted, Arbitrator Mutch had already determined Mr. Aloysius was catastrophically impaired on the same grounds in the 2003 accident. She agreed with my analysis (as a Director’s Delegate) in RBC General Insurance Company and Thiruchelvam (FSCO P18-00032, April 12, 2019),² that, once you have crossed the threshold of being catastrophically impaired on a certain ground, you cannot be more catastrophically impaired on the same ground.

In her second decision, Arbitrator Morris dismissed the claims for attendant care because there was no evidence that Mr. Aloysius required additional assistance specifically related to the 2005 or 2006 accidents.

The matter of expenses has now come to me, as Arbitrator Morris has left Dispute Resolution Services.

The parties could not agree on expenses, so I advised that I would determine them on an expedited basis by written submissions. For instance, instead of a fine review of the dockets, I would be applying a ratio to the hearing time, a long-established practice. Mr. Aloysius advised that there was an issue about the hearing time, as they did not have all the transcripts, so I forwarded them to the parties. Counsel for Mr. Aloysius still desired production of the dockets to make proper submissions. I asked Insurer’s counsel whether it would be possible to export the dockets to a PDF for mailing. However, the response was that production of the dockets would unduly elongate the proceedings and make the determination of expenses too complicated.

The Insurer’s first Bill of Costs dated March 24, 2020 claimed a total of about $86,500. Upon its receipt, I immediately notified counsel that I would be deducting the amount claimed for the court reporter, writing that as counsel knew, in Yogesvaran and State Farm Mutual Automobile Insurance Company (FSCO P17-00086, October 5, 2018), I allowed the appeal where the arbitrator had awarded transcript expenses. I also wrote that the same applies to the expenses of court reporters: Mooney and Wawanesa Mutual Insurance Company (FSCO P17-00050, June 21, 2019).

Beyond that, of course, in the appeal expenses decision of Delegate Lee in this case, Mr. Aloysius’s claim for the transcript costs for the first hearing had been denied, so the point that such expenses are not claimable had already been made in this exact case.

The initial Bill also included all kinds of fees not related to this hearing, including claims for previous counsel’s work done prior to June 2013, as Mr. Aloysius pointed out.

Accordingly, on March 30, 2020, counsel for Royal wrote that he would file an amended Bill of Costs because the one he had delivered erroneously included charges that were not related to the most recent arbitration. Royal later clarified on March 31, 2020, that no claims were made for expenses of the earlier appeal, either, noting that if anything had been included that ought not to have been, counsel apologized and assured us that it was unintentional. There were also issues regarding production of invoices for various disbursements. I did advise that I would not require any person to attend at an office closed, due to the coronavirus, to obtain documents.

Also on March 30, 2020, Royal delivered its Revised Insurer’s Bill of Costs, now claiming about a quarter of what it had, namely $23,302.44 inclusive. Royal also forwarded its process server invoices of about $1100.

The submissions of Mr. Aloysius are quite lengthy at 37 pages. His first main submission, over about 12 pages, is that each party should bear their own expenses because the proceedings were “novel” under Rule 75.2(c) of the Dispute Resolution Practice Code, namely “whether novel issues are raised in the proceeding.” First, he submits that the scenario was created that was “novel” because, had Arbitrator Mutch made findings in the alternative, such as dealing with potential catastrophic impairment from the 2005 and 2006 accidents, the re-hearing would have been unnecessary. He then submits that my decision in Thiruchelvam was new law, so the issue was novel in the context of this case.

Mr. Aloysius then spends about 12 pages submitting that Royal should not get expenses because of its behaviour. He devotes considerable space looking at old invoices from 2013 and comparing what Royal said about Mr. Aloysius’s hours being unreasonable when its own lawyers racked up 50 per cent more in time. He then notes the claim for the reporter in the initial Bill of Costs, suggesting that the insurer was prepared to make a claim for disbursements that were not allowable. (However, I note that Mr. Aloysius had made his own claim for court reporter expenses in this case.)

Royal’s submissions on the above points are very brief. It submits that any alleged errors by the tribunal are not “novel,” nor was any other aspect of the proceeding. It submits that references to the insurer’s submissions in previous proceedings and invoices dating back to 2013 are irrelevant, and that where the submissions “devolve into a slanderous personal attack against the insurer’s counsel,” they should be ignored or specifically rebuked as being inflammatory, grossly inappropriate, and irrelevant. It submits that it was successful under the prime directive of Rule 75.2(a), namely success, and that it should be awarded expenses, in a quantum this tribunal determines to be reasonable.

On the above points, I do not find any alleged “errors” by Arbitrator Mutch meet the criterion of novelty. Matters are often returned to arbitration in exactly the same circumstances as in this case. As to the novelty of multiple claims for catastrophic impairment, I note that in Thiruchelvam itself, I awarded expenses to the insurer, albeit much reduced from what it claimed. Nonetheless, I will keep this in mind when determining the appropriate ratio. As for the other submissions dealing with supposed past and present transgressions, I agree with Royal that these are irrelevant. Despite Mr. Aloysius’s protestations, I am not particularly shocked or appalled that lawyers say different things at the same time — like saying court reporter expenses are payable in one case and not payable in another — or keep advancing claims or positions that have previously been rebuffed.

I suppose the attitude is: whatever the fallout, make the claim.

I find that Royal is entitled to its arbitration expenses because it was entirely successful.

Turning to the appropriate ratio of preparation compared to hearing hours, I first note that the parties dispute the actual number of hours of the hearing. In its submission dated March 31, 2020, Royal took the position that the total time for the actual hearing was 20.7 hours (reduced by a third from its initial figure of 32.9 hours after receiving the missing transcripts). Counsel for Mr. Aloysius points out that the actual hearing time was 14.05 hours. He submits that the difference arises because Royal includes the lunch breaks and assumes the hearings started at 10:00 a.m. He submits that time not expended as actual hearing time cannot be considered as hearing time.

However, I am not aware of any such hard and fast rule in our case law. Rather, there has been a tendency to award the whole day versus just the actual hearing hours. See, for instance, Amoa-Williams and Allstate Insurance Company of Canada (FSCO A97–001864, October 24, 2001), and also Amato and Wawanesa Mutual Insurance Company (FSCO A02-000161, August 17, 2006). In the latter case, the arbitrator stated that the hours not only included presentation of the evidence but also the time needed for consultation. I allow 17 hours for the hearing time.

I agree with Mr. Aloysius’s submission that this case was not as complicated as the original hearing, as it was shorter and dealt with fewer issues. My initial inclination would be to assign a ration of 2:1. Mr. Aloysius submits that the failure to produce even a PDF of the dockets to compare against the hours claimed should lower the ratio. Given the novelty of the issue referenced above (and I note that there is a judicial review pending) and the inconsistencies in the Bill of Costs, I will apply a slightly lower ratio of 1.5:1. The total hours allowed for legal fees are thus 17 hours for hearing time plus 25.5 hours for preparation, for a total of 42.5 hours. Mr. Schrieder’s Legal Aid rate is $136.43, so the calculation is as follows:

Hearing Hours 17

Preparation @ 1.5:1 25.5

Total Hours 42.5

Legal Aid Rate $136.43

Total Legal Fees $5,798.28

HST 13% $753.78

Total Owing $6,552.05

I award a rounded fee of $6,550 for legal fees.

As for the disbursements, I agree with Mr. Aloysius that it is difficult to understand the claim for approximately $1,100 in process server fees when Royal called no witnesses.

I award a blanket fee for disbursements of $250, inclusive of HST.

In conclusion, Mr. Aloysius shall pay to Royal its legal fees and disbursements in the amount of $6,800, inclusive of HST.

I find neither party is entitled to any expenses for this expense hearing because Royal’s initial claims were riddled with mistakes, but Mr. Aloysius went on far longer than was necessary for a response.

April 30, 2020

David Evans Arbitrator

Date

Dispute Resolution Services de Règlement

Services des Différends

Neutral Citation: 2020 ONFSCDRS 7

A12-003310 A12-003311 A13-005353

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. Mr. Anthonidas Aloysius shall pay to Royal & SunAlliance Insurance Company of Canada $6,800 inclusive of HST for its legal fees and disbursements in this arbitration hearing.

April 30, 2020

David Evans Arbitrator

Date

Footnotes

1. 1The Statutory Accident Benefits Schedule - Accidents on or after November 1, 1996, Ontario Regulation 403/96, as amended.
2. 2Arbitrator Morris received submissions on Thiruchelvam because it came out after the initial re-hearing in this matter before Arbitrator Mervin.