DIVISIONAL COURT FILE NO.: 56/02
ONTARIO
SUPERIOR COURT OF JUSTICE
(DIVISIONAL COURT)
BLAIR R.S.J., LANE AND EPSTEIN JJ.
B E T W E E N:
EDWARD TANNER and BRENDA TANNER
Karl Arvai, for the Plaintiffs (Respondents)
Plaintiffs
(Respondents)
- and -
STEVEN CLARK and WILF MORRISON TRUCKING
Mark Edwards, for the Defendants (Appellants)
Defendants
(Appellants)
DIVISIONAL COURT FILE NO.: 55/02
COURT FILE NO: 23898/96
AND B E T W E E N:
JENNY LYNN REIMER and HANS REIMER
Karl Arvai, for the Plaintiffs (Respondents)
Plaintiffs
(Respondents)
- and -
DIANNE CHRISTMAS
Kevin L. Ross, for the Defendant (Appellant)
Defendant
(Appellant)
ENDORSEMENT AS TO COSTS
1The appellants were successful in these two appeals, heard together pursuant to leave granted in a common leave application. The appeals raised the common issue of the application of the implied undertaking rule to production obligations in the context of the interrelationship between arbitration proceedings before the Financial Services Commission of Ontario concerning accident benefits and actions for general and pecuniary damages. More specifically, the common issue was whether the implied undertaking rule operated to protect certain medical reports obtained in the arbitration proceeding from disclosure in the tort action. In reasons delivered June 26, 2002 we allowed both appeals and requested submissions as to costs. We have reviewed the written submissions provided in response to this request.
2The appellants seek costs in respect of various stages leading to the final determination of the dispute concerning the production of the medical reports.
(a) The two original motions;
(b) The combined leave application;
(c) The attendance before the Divisional Court in January of 2002; and
(d) The appeal.
3The respondents' primary submission is that there should be no order as to costs as the motions dealt with a novel and complex question of law. Further, there were conflicting decisions on this important issue that had to be resolved. In support of the proposition that in such circumstances each party should bear their own costs, the respondents rely on authorities including Elliott v. Canadian Broadcasting Corp. (1995) 1995 244 (ON CA), 38 C.P.C. (3d) 332 (Ont. C.A.), Heon v. Heon (1988) 1988 4824 (ON CA), 67 O.R. (2d) 312 and Fong v. Bamford (1995) 1995 7107 (ON SC), 25 O.R. (3d) 147.
4We do not agree that no costs should be awarded. First, to require each party to bear their own costs there has to be more than conflicting decisions to be resolved. Otherwise all motions before the Divisional Court in matters where leave is granted under R. 62.02(4)(a) would attract such a cost award. Similarly, not all novel issues of law give rise to such an order. Such may be the case where the matter involves a public body trying to elucidate the law or where a party has raised a constitutional issue or one otherwise of broader interest. However, where, as in the two matters before us, the parties were pursuing their own disclosure interests, we do not consider it appropriate to deprive the successful party of costs.
5On the assumption that we would be awarding costs to the appellants, all parties made submissions as to quantum. These submissions were prepared on the assumption that a partial indemnity scale was appropriate. We agree that there is nothing that would attract a full indemnity award. Moreover, all parties proceeded on the basis that we should fix the costs. Our task is therefore to decide upon an appropriate amount of costs taking into account the new Costs Grid as well as the factors relevant to the fixing of costs.
6In considering the appellants' Bills of Costs in light of the Costs Grid, it is clear that counsel have overlooked the fact that they must claim their counsel fees at the various hearings under the per diem counsel fees set out in paragraph 2 of the Costs Grid. As was observed by Killeen J. in Incorporated Broadcasters Limited et al. v. Canwest Global Communications Corp. et al. (March 15, 2002) these counsel fees are intended to be block fees "up to" the maxima set out in the paragraphs. The amounts claimed by the appellants for the actual hearings have therefore been adjusted to comply with this part of the Costs Grid.
7In fixing costs, the Court acts under the discretion afforded by section 131 of the Courts of Justice Act and Rule 57.01. The latter gives a useful reminder of the elements to be examined in the exercise of the discretion. They include the result, complexity, importance of the issues, conduct, improper or unnecessary steps and any other matter that is relevant to the costs. The court is given the opportunity to craft a costs order that fits the case.
(a) The costs of the original motions.
8Leitch J. ordered the appellant in Reimer v. Christmas to pay costs in the amount of $2,500 plus interest at a rate of 7% per annum, from February 16, 2001. The appellant paid $1,500 on July 24, 2001, in partial payment of the costs, pending the appeal.
9The appellant seeks the repayment of the $1,500 and an order from this court that she be awarded $2,500 plus interest at 7 percent per annum from February 16, 2001 in respect of that motion. The respondents argue that they were partially successful before Leitch J. on an issue that was not appealed. The $1,500 should cover the appellant's obligation in relation to this issue. There should therefore be no adjustment to the costs.
10We agree with the respondents' submissions concerning the divided success. In the result, the costs order made by Leitch J. will be varied such that the appellant is required to pay costs of $1,500. The appellant has paid this amount and is relieved of any further cost obligation in relation to that motion.
11In Tanner v. Clark, Browne J. awarded costs of the motion to the respondents in the amount of $2,000.
12The appellants have submitted a Bill of Costs supporting a fee of $7,238.00. No disbursements are claimed. The respondents submit that this amount is grossly excessive in light of the motion judge's costs award.
13Again, we agree with the respondents' submissions. There is no reason to disturb the quantum of costs awarded by Browne J. Costs, should, however, follow the event and accordingly the respondents are ordered to pay the appellants' costs of that motion, fixed in the amount of $2,000.
(b) The costs of the Leave Application
14By order dated July 11, 2002 Hockin J. granted leave and reserved the costs of the leave application to this court.
15In the Reimer v. Christmas action, the appellant claims $12,061.00 for fees, $901.97 for G.S.T. and $824.32 for disbursements. In Tanner v. Clark, the appellants submit that a fair amount on a partial indemnity scale would be $7,593 in fees, disbursements of $110 and GST of $531.51.
16The respondents submit that costs in the range of $2,500 - $3,500 would be reasonable and proportionate to the importance and complexity of the issue involved.
17Taking into consideration the factors mentioned above, we are of the view that costs of the leave application be awarded in favour of the appellants in each action. The appellants in Reimer v. Christmas will be awarded their costs fixed in the amount of $5,000 for fees, $901.97 for disbursements and appropriate GST. In the Tanner v. Clark matter, the appellants will have their costs fixed in the amount of $3,500 for fees, $110 for disbursements and appropriate GST. We have fixed the appellants fees in the Reimer v. Christmas matter in a higher amount as it is clear from a review of the Bills of Costs and the written submissions that counsel in the Reimer v. Christmas action carried the argument and performed the bulk of the work leading up to the hearing.
(c) The attendance before the Divisional Court on January 7, 2002
18The appeal was originally scheduled to be argued on January 7, 2002 in London. The parties to the Reimer v. Christmas matter were fully prepared to proceed. The court adjourned both matters because the appellants in Tanner v. Clark had not perfected their appeal. The Court reserved the issue of the costs of that attendance to this court.
19The appellant in the Reimer v. Christmas action submits that she should be compensated for the costs thrown away in the amount of $6,560 for fees and $459.20 for GST. Counsel submits that his client's costs ought to be paid by the respondents or by the appellants in the Tanner v. Clark proceeding. The respondents in both actions argue that the appellants in the Tanner v. Clark action should be responsible for their costs of that day. The appellants in Tanner v. Clark do not dispute their obligation to pay the costs thrown away resulting from this attendance. They question the amounts requested.
20The sole reason for the adjournment was the failure of the appellants in Tanner v. Clark matter to perfect their appeal. It follows that these appellants should bear the costs thrown away of all parties. We fix the costs of the appellants in Reimer v. Christmas in the amount of $2,500 plus GST and of the respondents in the Tanner v. Clark action in the same amount.
(d) The costs of the Appeal
21The appellant in the Reimer v. Christmas action submits she is entitled to her costs fixed in the amount of $20,311 for fees, $1,497.49 for GST and $1,081.75 for disbursements. In the written submissions, counsel for the appellant argues that due to the complexity of the matter in issue and its importance to pre-trial discovery rights and obligations, the amount of time invested in the successful prosecution of the matter was reasonable and appropriate. This appellant further submits that it assumed the burden of the bulk of the research and preparation that resulted in cost savings to the parties in both proceedings.
22The appellants in the Tanner v. Clark action have submitted a Bill of Costs in respect of the appeal of fees in the amount of $5,882.50, disbursements of $1,368.00 and GST of 411.77.
23The respondents take strong exception to the amounts the appellants claim for the appeal itself. They argue that the hourly rates used by counsel for the appellants in the Reimer v. Christmas action are excessive for London counsel and that, in general, counsel fees should be contained within reasonable limits. The respondents submit that the appropriate amount of costs for the appeal is $5,000.
24In fixing the costs of the appeal we have taken into account the submissions, the implications of the Costs Grid and the other factors relevant to the fixing of costs. We have also adjusted the amounts claimed for the obvious fact that for the most part the same issues were the subject of preparation and submissions at each attendance. It follows that there would be some duplication of work reflected in the amounts claimed.
25Against this background, we fix the costs of the appeal as follows. The appellants in Reimer v. Christmas are awarded their costs in the amount of $7,500 for fees plus disbursements as claimed and appropriate GST. The appellants in Tanner v. Clark are awarded their costs in the amount of $4,000, again plus disbursements and GST.
26Finally, the respondents submit that the costs, as fixed, should not be payable forthwith but rather deducted from the appellants' obligation in damages. They argue that in both cases the respondents have suffered injuries as a result of the accidents that have affected their ability to earn an income. The appellants have not made any advance payments. As a result, the respondents are in no position to make a payment on account of costs and that an order that they pay the costs forthwith may expose the respondents to having their actions stayed or dismissed.
27The appellants simply say that their costs should be paid forthwith.
28A legitimate concern has been raised about the effect of an order that costs of the magnitude fixed be paid forthwith on the respondents' access to justice. In the circumstances, and in the absence of any further submissions from the appellants on this point, we order the costs, as fixed, be paid in any event of the cause at the end of the actions.
EPSTEIN J.
BLAIR R.S.J.
LANE J.
Released: September 24, 2002