Tribunal File Number: 16-002272/AABS
Case Name: 16-002272 v Aviva Insurance Canada
In the matter of an Application for Dispute Resolution pursuant to subsection 280(2) of the Insurance Act, RSO 1990, c I.8., in relation to statutory accident benefits.
And in the matter of a motion by the respondent seeking costs.
Between:
D. C.
Applicant
and
Aviva Insurance Canada
Respondent
DECISION ON A MOTION
ADJUDICATOR: Catherine Bickley
Written submissions: Amanda Lo Cicero, Counsel for the Respondent
No submissions from the Applicant
OVERVIEW
A hearing was scheduled for February 15, 2017 to decide whether the applicant was entitled to medical benefits for injuries arising from a February 3, 2012 accident. The applicant withdrew her application on February 1, 2017, two weeks before the scheduled hearing. The respondent seeks an award of costs.
I find that the respondent is not entitled to costs. These are the reasons for my decision.
BACKGROUND
On August 26, 2016, the applicant filed an application appealing a denial of medical benefits.
At a November 22, 2016 case conference, the case conference adjudicator scheduled a hearing (written and by teleconference) for February 15, 2017. He ordered the parties to file their written submissions and evidence as follows:
Applicant’s submissions due January 12, 2017;
Respondent’s submissions due January 26, 2017; and,
Applicant’s reply submissions, if any, due February 2, 2017.
The applicant did not file any evidence or submissions with the Tribunal by January 12, 2017 or at any time.
On January 16, 2017, the respondent brought a notice of motion requesting:
a. A resumed case conference to resolve outstanding production issues; or, in the alternative,
b. Dismissal of the application with costs; or, in the alternative,
c. An adjournment of the respondent’s filing deadline and costs.
On January 19, 2017, the Tribunal ordered that the hearing would proceed as scheduled and that the respondent’s motions would be heard by the hearing adjudicator.
The next day, the applicant’s legal representative wrote to the Tribunal stating that she had been unable to contact her client since November 30, 2016 and asking to be removed from the record. The letter was not copied to the applicant or to the respondent.
On February 1, 2017, the applicant sent the Tribunal an email withdrawing her application.
In the interim, on January 26th, the respondent had filed its submissions (including a request for costs) and evidence with the Tribunal. These submissions were served on the applicant’s former legal representative but not on the applicant. It is unclear whether the respondent knew that the applicant no longer had legal representation as it was not copied on the January 20th letter in which the applicant’s legal representative asked to be removed from the record.
On February 2, 2017, the respondent advised the Tribunal that notwithstanding the withdrawal of the application it still wanted a determination of its request for costs. The February 15th teleconference hearing was converted to a written motion hearing.
The applicant subsequently advised the Tribunal that she would not be making any submissions on the motion.
THE CRITERIA FOR AN AWARD OF COSTS
Rule 19 permits a party to request costs if it believes another party in a proceeding has acted unreasonably, frivolously, vexatiously, or in bad faith.
The award of costs under Rule 19 is a discretionary remedy that is made only in exceptional circumstances. Such an award is a tool to deter and penalize egregious behaviour by a party during a proceeding. To attract an award under Rule 19 a party’s actions must do more than inconvenience the opposing party.
As Executive Chair, Linda Lamoureux, has noted, “a withdrawal of an application alone will rarely, if ever, be a sufficient basis on which the Tribunal will make a cost order.”1 Given that access to justice is central to the mandate of the Licence Appeal Tribunal, “a cost award shall not be granted merely because a withdrawal has caused another party inconvenience. In the case of a withdrawal, there must be sufficient evidence that the Applicant has engaged in a course of conduct that is unreasonable, frivolous, vexatious, or is in bad faith.”2
THE RESPONDENT’S SUBMISSIONS
The respondent’s submissions on costs were made before the applicant withdrew her application. It did not file any supplementary submissions after the withdrawal.
The respondent submits that the applicant abandoned her application by failing to file submissions or evidence as required by the case conference order. The respondent argues that the applicant could not have reasonably expected to be successful in her appeal without filing any submissions or evidence. Further, by failing to withdraw before the submission due date, she acted frivolously and in bad faith and put the respondent to time and expense in preparing its submissions.
The respondent relies on two decisions from the Financial Services Commission of Ontario (“FSCO”).
In Vitalis3, an applicant failed to attend multiple pre-hearings and could not be reached at the address or contact numbers on the application for arbitration. The arbitrator dismissed the application as abandoned and found that the insurer was entitled to its reasonable expenses.
In Nagalingam4, the applicant failed to attend the pre-hearing and did not respond to communication from FSCO. The insurer requested that the application be dismissed on the basis that it was frivolous, vexatious or commenced in bad faith. The arbitrator found it was more appropriate to dismiss the application on the basis that it was abandoned. The arbitrator awarded the insurer $1,000.00.
ANALYSIS AND DECISION
For the following reasons, I find that a costs award is not appropriate.
The Vitalis and Nagalingam decisions are not particularly helpful for three reasons:
The Tribunal is not bound by FSCO decisions.
An award of costs under Rule 19 differs significantly from an award of expenses at FSCO. In FSCO arbitrations, the successful party typically receives its expenses. In contrast, an award of costs under Rule 19 is a discretionary remedy. Such an award does not routinely follow success at a hearing as costs are not meant to compensate parties for bringing or defending a claim. Rather, in appropriate circumstances an award of costs penalizes a party whose actions have impeded the Tribunal in carrying out its mandate to provide fair and efficient resolution of automobile accident benefit disputes. The possibility of an award under Rule 19 also acts to deter inappropriate behaviour by a party.
Vitalis and Nagalingam deal with fact situations quite different from this case. Indeed, in Vitalis the applicant is criticized for not withdrawing his application. In this case, the applicant withdrew her application two weeks before the hearing.
The applicant withdrew her application twelve days after the Tribunal was advised that she no longer had legal representation and two weeks before the hearing date. I find that the applicant took steps to bring this proceeding to an end in a reasonable time after she became self-represented.
The respondent’s January 16th motion sought, among other remedies, an extension of the deadline to file its submissions. The Tribunal declined to grant that remedy. It was this decision of the Tribunal rather than any action of the applicant that required the respondent to file its submissions by the original deadline of January 26th.
Although the timing of the application’s withdrawal (after the submission due dates) inconvenienced the respondent and may have caused it some expense, that inconvenience and the expense involved would have been less than if the application had proceeded to a hearing. Inconveniencing an opposing party does not amount to vexatious, frivolous, unreasonable or bad faith behaviour.
Having reviewed the history of this application and the respondent’s submissions and for all the reasons set out above, I find that an award of costs is not appropriate.
ORDER
- The respondent’s motion for costs is dismissed.
Released: June 6, 2017
___________________________
Catherine Bickley, Adjudicator
Footnotes
- Reconsideration decision, Tribunal File 16-000474/AABS, October 19, 2016.
- Reconsideration decision, Tribunal File 16-000474/AABS, October 19, 2016.
- Vitalis v. Intact Insurance Company FSCO A12-001238 April 29, 2015
- Nagalingam v. State Farm Mutual Automobile Insurance Company FSCO A13-003114 January 18, 2016.