Tribunal File Number: 16-004030/AABS
Case Name: 16-004030 v Unifund Assurance 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. R.
Applicant
and
Unifund Assurance Company
Respondent
DECISION
Adjudicator: Terry Hunter, Vice Chair
Appearances:
For the applicant: Gary Mazin, counsel
For the respondent: Paul Belanger, counsel
HEARD: In-writing: June 1, 2017
ISSUES TO BE DECIDED
Does the Licence Appeal Tribunal (“Tribunal”) have the authority to order costs brought in a separate application for an earlier application that has been closed?
Is the respondent entitled to costs in the current application?
RESULT
Tribunal does not have jurisdiction to entertain a stand-alone application for costs which relates to conduct in a prior application.
The respondent is not entitled to an award of costs.
OVERVIEW
- The applicant was injured in a motor vehicle accident on February 10, 2014 and sought benefits pursuant to the Statutory Accident Benefits Schedule - Effective September 1, 2010 (the ''Schedule'').
Application #1 (LAT File 16-000186/AABS)
The applicant filed an application with the Tribunal on May 5, 2016 (File: 16-000186/AABS).
The parties participated in two case conferences but were unable to resolve the issue in dispute between them. A three day hearing was scheduled to take place on November 1, 2 and 3, 2016 to determine whether the applicant sustained a catastrophic impairment as defined by the Schedule.
On October 31, 2016, the hearing was cancelled by the parties because the respondent accepted the applicant as being catastrophically impaired. Tribunal File 16-00186/AABS was closed.
The applicant did not make a request for costs prior to the file being closed.
Current Application (LAT File 16-004030/AABS)
On November 18, 2016 the applicant submitted a new application to the Tribunal dated November 16, 2016 (File: 16-004030) which is the application before me.
The only issue in dispute in the Application dated November 16, 2016, is whether the applicant is entitled to costs and disbursements in the amount of $33,497.57 for the hearing which was scheduled to proceed on November 1, 2016 and was subsequently cancelled.
At a case conference held on February 23, 2017, I ordered that this issue be decided by way of written hearing. The hearing date was set for June 1, 2017. The issue to be determined is whether or not the LAT has jurisdiction to make an award of costs in a prior application which had already been concluded.
In response to the applicant’s claim for costs, the respondent made an oral claim for costs at the case conference held on February 23, 2017. The respondent submits that the applicant’s application for costs in a prior proceeding that was settled constitutes bad faith and unreasonable, frivolous and vexatious conduct.
The respondent did not elaborate on the basis for its claim for costs or make submissions on the amount that should be awarded.
Analysis
The Tribunal’s jurisdiction to award costs is contained in the Tribunal’s Rules of Practice and Procedure in Rules 19.1 and 19.2. They contain two preconditions for an award of costs. First, the conduct complained of must relate to the proceeding in which the conduct is alleged to have incurred. Second, the request for costs must be made in the proceeding before the decision or order is released.
In Thompson v. Intact Insurance, 16-000041/AABS, it was held the cost application must be made within the proceeding being adjudicated to come within the Tribunal’s jurisdiction.
In the case of 16-000501 v. Dumfries Mutual Insurance Company, 2017 CanLII 15834, Adjudicator Theoharis found Rule 19 does not give the Tribunal jurisdiction to award costs for behaviour that occurred prior to the filing of this application.
I am persuaded by the aforementioned decisions and as a result find that the Tribunal has no jurisdiction to entertain a stand-alone application for cost which relates to conduct in a prior application.
The respondent argues that the applicant’s decision to file an application relating only to costs is evidence of bad faith, and unreasonable, frivolous and vexatious conduct. Rule 19.4 requires reasons for a request for cost and particulars of the other party’s conduct as it relates to costs. I find the respondent has not met the test envisaged in Rule 19. In the absence of reasons and particulars, I am unable to award cost to the respondent.
Even if I am wrong this regard, I find that the applicant’s decision to file this application is not sufficient to award costs. The test to find bad faith and unreasonable, frivolous, vexatious behavior is very high. The applicant submits that his conduct must be considered in light of the recent legislative changes. It has been less than two years since the Tribunal assumed responsibility for resolving disputes involving statutory accident benefits from Financial Services Commission (FSCO).
The Tribunal’s process is thus relatively new and unfamiliar to the parties; and there is not a well-established body of jurisprudence to turn to for guidance. In light of this, the applicant argues that his filing of an application for costs cannot be characterized as unreasonable or frivolous or vexatious. I agree with the applicant and find that his conduct does not meets the test as contained in the Rule 19 for the awarding of costs.
Released: September 5, 2017
Terry Hunter, Vice Chair