R. U. v. Aviva General Insurance Company, 2017 CanLII 69276

Licence Appeal Tribunal

Date: 2017-03-09 Tribunal File Number: 16-001649/AABS Case Name: 16-001649 v Aviva General Insurance Company

In the matter of an Application pursuant to subsection 280(2) of the Insurance Act, RSO 1990, c I.8., in relation to statutory accident benefits.

Between:

R. U.

Applicant

and

Aviva General Insurance Company (formerly RBC Insurance Company)

Respondent

COSTS DECISION

Adjudicator: Catherine Bickley

Written submissions: Philip R. Cumbo, Counsel for the Respondent, Kevin Lin, Counsel for the Applicant

OVERVIEW

1The applicant was absent at the start of a hearing scheduled for January 11 and 12, 2017. Her counsel requested an adjournment. Neither the respondent nor the Tribunal had been given advance notice of the adjournment request.

2I granted the applicant’s adjournment request¹ based on her counsel’s submissions that the applicant’s mother had had a stroke the previous week and that the applicant had left Canada on January 5th.

3This decision deals with the respondent’s request for costs. I have considered the parties’ oral submissions of January 11th and 12th as well as their subsequent written submissions.

ISSUE

4Is the respondent entitled to costs pursuant to Rule 19? If so, what is the appropriate amount?

RESULT

5The respondent is entitled to an award of costs in the amount of $700.00.

IS THE RESPONDENT ENTITLED TO COSTS?

The criteria for an award of costs

6Rule 19 permits a party to request costs if it believes another party in a proceeding has acted unreasonably, frivolously, vexatiously, or in bad faith.

7The award of costs is a discretionary remedy and the Tribunal will not lightly make a costs award. In order to determine whether such an award is appropriate in this case it is necessary to review the actions of the applicant and of her counsel on her behalf.

The applicant’s departure from Canada and her communication with her counsel

8The applicant’s costs submissions reveal that, contrary to her counsel’s earlier submissions, the date of her departure from Canada is unknown. The following excerpts from her submissions detail her counsel’s attempts to contact her during the week leading up to the hearing:

On or about January 5, 2017, the applicant’s counsel, through a law clerk who could speak Tamil, reached the applicant’s sister at the applicant’s home phone number. The applicant’s sister advised the clerk the applicant had left suddenly for Germany because their mother had a medical emergency. No other information was provided.

The applicant’s counsel attempted to reach the applicant and follow-up with the applicant’s sister numerous times to obtain further information, but “was not successful in reaching neither [sic] the applicant nor the applicant’s sister.”

Voicemails were left with the applicant’s home and cell number and emails were sent to the applicant with the expectation that they would be returned, but they were not returned.

From January 5, 2017 to the morning of January 11, 2017, the applicant’s counsel continued to leave urgent emails and voicemails with the applicant reminding her of the Hearing, inquiring about her return, and advising of a new offer by the insurer.

To this day it is unknown when the applicant left Canada.

On January 23, 2017, the applicant sent by email an apology and advised that she was out of Canada and attending to her mother.²

9On the material before me it is impossible to determine the exact date that the applicant left Canada. The applicant submitted no evidence to establish the actual date of her mother’s stroke or the date on which the applicant left Canada.

10On December 16, 2016 the applicant’s counsel sent her a reminder of the January hearing.³ The applicant’s submissions mention no subsequent communication between the applicant and her counsel in the weeks prior to January 5th. I conclude that it is more likely than not that while January 5th is the date on which the applicant’s counsel discovered that his client was out of the country, she actually left Canada some days or even weeks earlier.

11The applicant did not tell her counsel that she was leaving the country. He discovered her absence only because he had a law clerk call her home telephone number on January 5th. The applicant did not communicate with her counsel until January 23rd.

Communication with the respondent and the Tribunal

12When the applicant’s counsel learned that his client was in Germany he kept this information to himself and continued settlement negotiations with the respondent.

13The parties agree that there was ongoing communication between counsel by email and telephone between January 5th and January 9th. Their final exchange consisted of an email at 9:45 a.m. on January 9th from the respondent’s counsel asking the applicant’s counsel, “Have you spoken to your client about our offer that we made on Friday?” and the applicant’s counsel’s email reply at 3:40 p.m. that same day saying only: “I’m out of the office again today, but I think I’m close. Please give me a bit more time.” There was no further communication between counsel until the hearing two days later.

14On January 10th, the day before the hearing, the Tribunal’s Case Management Officer contacted the applicant’s counsel. Her log note records their conversation as follows:

On January 10th at approx. 10:00am I spoke with Applicant’s counsel Kevin Lin. They are working on trying to settle and are hoping to however, he can’t confirm at this point. He will be speaking with parties today and will keep us updated on any changes that may happen but as of now the hearing is set to take place. Notified hearing Adjudicator and Victoria in regards to this.

15The Tribunal did not receive any information that an adjournment would be requested until the start of the hearing on January 11, 2017.

Were the actions of the applicant unreasonable, frivolous, vexatious or in bad faith?

16I am satisfied that the applicant had notice of the hearing. Not only did her counsel send her a reminder, the Tribunal also sent its Notice of Hearing directly to her in addition to sending it to her counsel. As well, on January 5th, a law clerk spoke with the applicant’s sister. Given their mother’s medical situation, it is probable that the applicant’s sister would have been in regular contact with the applicant and would have told the applicant that her counsel wanted to talk with her about the rapidly approaching hearing. Yet the applicant did not communicate with her counsel until 18 days later.

17Although the applicant knew that the hearing was starting on January 11th, she did not tell her counsel that she was leaving the country and would be unable to attend the hearing. She did not leave her counsel with any instructions regarding her upcoming hearing. I find it difficult to believe that the applicant could not have communicated with her counsel via telephone, text message, email or fax, or through her sister. I conclude that she chose not to do so.

18The applicant’s submissions acknowledge that being in Germany “did not preclude her from providing instructions to the applicant’s counsel orally or in writing through email”⁴. She did not do so.

19I find that the applicant’s actions were unreasonable.

20In finding that the applicant has acted unreasonably, I do not criticize her for travelling to be with her ill mother. It was, however, incumbent on her to let her counsel know that she was doing so as well as to provide him with instructions. It was unreasonable for the applicant and her counsel to keep the respondent and the Tribunal in the dark about her inability to attend the scheduled hearing.

21I turn now to considering what information was given to the respondent and the Tribunal.

22Upon discovering on January 5th that his client was in Germany, the applicant’s counsel continued settlement negotiations while trying to reach his client. I see nothing wrong with him doing so for a short period of time. As the hearing approached, however, and all attempts to reach his client failed, he had an obligation to be frank with both respondent counsel and the Tribunal.

23Through omission, he gave the respondent the impression that the applicant was available for the hearing. Even when asked directly by the Tribunal less than 24 hours before the hearing he maintained the fiction that the hearing was going ahead.

24I do not accept the applicant’s counsel’s submission that his duties to his client prevented him from disclosing that she was out of the country, that he did not know when she would return and that he was unable to contact her. The desire to preserve a strong negotiating position, which was the main justification offered by counsel, does not justify misleading the respondent and the Tribunal.

25I also do not accept the submission that he was not certain that his client would be unable to attend the hearing. While he may have hoped on January 5th that his client would return in time, that hope became unrealistic as the hearing drew nearer with no communication from her. In my view, by Monday, January 9th at the very latest, the respondent and the Tribunal should have been advised that the applicant was seeking an adjournment.

26Counsel has an obligation to deal with opposing counsel and the Tribunal honestly and in good faith. He did not do so.

27An Application starts a legal proceeding which engages considerable resources on the part of the parties and the Tribunal. Accordingly, the Tribunal expects parties to an Application to keep it and other parties informed of situations which may delay a hearing. This is particularly so when the Tribunal directly asks a party the day before the hearing whether that party expects the hearing to go ahead. The actions of the applicant and her counsel resulted in expense and inconvenience to the respondent and tied up the Tribunal’s adjudicator and hearing space, scarce resources that could have been allocated to other matters. In addition, an interpreter hired by the Tribunal needlessly attended the hearing.

28In summary, I find that the applicant acted unreasonably and in bad faith and as a result an award of costs is appropriate. I turn now to determining the appropriate amount of that award.

AMOUNT OF COSTS AWARD

29The discretionary award of costs may be seen as a mechanism for discouraging action by a party that impedes the Tribunal in carrying out its mandate to provide fair and efficient resolution of automobile accident benefit disputes.

30The respondent seeks an award of $9,331.49 for expert costs, legal fees and disbursements⁵.

31In my view, Rule 19 is intended to sanction and discourage unacceptable behaviour rather than to replicate the approach to costs taken by civil courts. Consequently, establishing that Rule 19’s criteria have been met is not a threshold that, once crossed, entitles a party to an award of costs on a full, partial or substantial indemnity basis.

32In this case, the applicant’s actions inconvenienced the respondent and the Tribunal and consumed two days of valuable hearing time. The hearing is now scheduled to resume in July 2017, significantly delaying a determination of the issues in dispute. In considering the appropriate quantum of costs, I have taken these factors into account.

33Weighing all of these factors, I am of the view that an award of $700.00 recognizes the seriousness of the applicant’s actions, the impact of those actions on the respondent and the Tribunal and is an amount sufficient to discourage similar unacceptable actions in the future.

ORDER

34The applicant shall pay costs of $700.00 to the respondent.

Footnotes

1. 1See bottom line adjournment decision (January 13, 2017) and adjournment decision with reasons (March 2, 2017).
2. 2Applicant’s Cost Submissions, PART II, RELEVANT FACTS, paragraphs 7, 8, 9, 12 (partial), 13, 14
3. 3Applicant’s Cost Submissions, PART II, RELEVANT FACTS, paragraph 1
4. 4Applicant’s Cost Submissions, PART III – ARGUMENT Reasonable Conduct of the Applicant and the Applicant’s Counsel, paragraph 5.
5. 5The respondent also submitted calculations for an award of costs on a partial or substantial indemnity basis.