Tribunal File Number: 16-004565/AABS
Case Name: 16-004565 v Aviva 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:
F. K. T.
Applicant
and
Aviva Insurance Company
Respondent
DECISION ON COSTS
Adjudicator: Sandeep Johal
APPEARANCES:
For the Applicant: Stefan Juzkiw, Counsel
For the Respondent: Amanda Lo Cicero, Counsel
Heard in-writing: July 27, 2017
OVERVIEW
1The applicant was injured in an automobile accident on January 29, 2015 and sought benefits pursuant to the Statutory Accident Benefits Schedule – Effective September 1, 2010 (the ''Schedule'').
2A dispute arose about the applicant’s entitlement to benefits and the applicant submitted an application for dispute resolution services to the Licence Appeal Tribunal - Automobile Accident Benefits Service (the “Tribunal”).
3The respondent brought a motion seeking the dismissal of the proceedings with costs on February 27, 2017, as the applicant was not in compliance with section 55(1) of the Schedule and has not notified the respondent of the circumstances giving rise to his claim for income replacement benefits. The Tribunal scheduled a written motion hearing for May 17, 2017.
4A case conference was scheduled for March 8, 2017 and was cancelled by the Tribunal on March 3, 2017 to allow the applicant to file his response for the motion to dismiss with costs.
5On May 12, 2017, the applicant withdrew the application for dispute resolution at the Tribunal and the Tribunal closed its file and issued a closing letter to the parties.
6On May 30, 2017, the respondent filed a motion seeking costs against the applicant and an order was issued on June 26, 2017 scheduling a written motion hearing for July 27, 2017 and for the parties to specifically provide submissions on whether the Tribunal has jurisdiction to hear a motion for costs after the applicant withdrew their Tribunal application.
7The parties filed written submissions as ordered and those submissions form the basis for this decision.
ISSUES TO BE DECIDED
8Does the Tribunal have jurisdiction to hear the respondent’s request for costs? If so,
9Is the respondent entitled to recover costs pursuant to Rule 19.1 of the Licence Appeal Tribunal Rules of Practice and Procedure (the “Rules”)?
RESULT
10Based on the totality of the evidence before me, I find that the Tribunal does have jurisdiction to hear the respondent’s request for costs, however I find that the respondent is not entitled to recover costs pursuant to Rule 19.1 of the Rules.
THE LAW
11The Tribunal’s authority to award costs comes from two sources: Section 17.1 of the Statutory Powers and Procedure Act (“SPPA”); and Rule 19.1 of the Rules.
12Section 17.1(1) of the SPPA empowers the Tribunal to order a party to pay another party’s costs in a proceeding according to rules made under s. 17.1(4). Section 17.1(2) states the Tribunal shall not order a party to pay costs unless the conduct or course of conduct of that party has been unreasonable, frivolous or vexatious, or has acted in bad faith.
13Rule 19.1 of the Rules mirrors the language of s. 17.1(2) of the SPPA, and provides that a party may make a request to the Tribunal for its costs where a party believes that another party in a proceeding has acted unreasonably, frivolously, vexatiously or in bad faith.
ANALYSIS
A. Does the Tribunal have jurisdiction to hear this motion for costs?
14The respondent filed a notice of motion for a dismissal of the Tribunal proceeding and costs on February 28, 2017 and the Tribunal scheduled a written motion hearing for May 17, 2017. The applicant filed his notice of withdrawal on May 12, 2017 and thereafter the Tribunal closed its file and cancelled the written motion hearing.
15I find the respondent acted in accordance with Rule 19.2 and made its request for costs on February 28, 2017, before the applicant withdrew his Tribunal application and accordingly the proceeding was still before the Tribunal. The motion for costs can be heard on its merits in accordance with Rule 19.
B. Is the respondent entitled to costs?
16This motion for costs was brought by the respondent and the onus is on that party to prove on a balance of probabilities that the applicant acted unreasonably, vexatiously, frivolously or in bad faith.
17The respondent submits that the applicant brought an application knowing it was “baseless and had no chance of success.” He “failed to provide the minimum evidence necessary to support entitlement to the benefits in dispute.” He “failed to respond to the majority of the respondent’s production requests.” He “failed to serve and file a case conference summary” as required by the Rules, and “based on the limited evidence the applicant produced, confirmed he was injured in a post-accident incident with police and not in the accident.”
18The respondent further submits that the applicant “knew or ought to have known from the outset that his appeal to this Tribunal was baseless and could not possibly succeed, yet chose to pursue it anyways and arguably in bad faith.” I disagree with the respondent that bringing an application to the Tribunal and not providing evidence satisfactory to the respondent amounts to bad faith. A “baseless application” is not a heading for consideration when assessing a cost award pursuant to Rule 19.1.
19A withdrawal of an application alone will rarely, if ever, be a sufficient basis on which the Tribunal will make a costs order. Access to justice is central to the mandate of the Safety, Licensing Appeals and Standards Tribunals Ontario and the Licence Appeal Tribunal. As such, a costs 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.1
20The respondent submits the applicant withdrew his application after the respondent’s deadline to file materials in support of its motion to dismiss with costs, and as a result the respondent incurred the expense of preparing affidavits, submissions and a bill of costs in support of the motion.
21An applicant has a right under the Schedule to bring an application to the Tribunal within two years of a denial by an insurer and if the applicant is unable to prove his claim, that does not mean the insurer is entitled to its costs under Rule 19. The behaviour of the party must be shown to have been unreasonable, frivolous, vexatious, or in bad faith.
22I am not persuaded of a course of conduct in this case that can be considered to be anywhere near the threshold of unreasonable, frivolous, vexatious or in bad faith. While I agree that the withdrawal of this application may have caused inconvenience to the respondent, however, inconvenience and the expense of preparing for a hearing are not grounds to award costs under Rule 19.
23Applicants may initiate applications where they believe they are entitled to benefits. Respondents have the right to raise appropriate defences in response to those applications. The Tribunal should not deter applicants from filing applications that may have merit. The respondent’s interpretation of what is frivolous, vexatious or in bad faith in this matter would discourage applicants from filing valid applications, and have a negative impact on access to justice.
CONCLUSION
24Cost awards under Rule 19 are not to compensate parties for suffering an inconvenience or for the cost of their involvement in a proceeding.
ORDER
25For the reasons outlined above, I find that the respondent has not provided sufficient evidence to satisfy Rule 19.1 and the claim for costs is dismissed.
Released: November 23, 2017
____________________________
Sandeep Johal, Adjudicator
Footnotes
- 16-000474 v. Aviva, 2016 CanLii 105250 (ON LAT) at para 19.