NEWMARKET COURT FILE NO.: DC-05-078224-00
DATE: 20070111
DIVISIONAL COURT
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: SAM COSENTINO v. ALFREDO ROIATTI and ALFREDO ROIATTI,
(The Estate Trustee of the Estate of Cornelia Roiatti, Deceased)
BEFORE: The Honourable Mr. Justice G.P. DiTomaso
COUNSEL: The Appellant on his own behalf
Michael A. Handler, for the Defendants (Respondents)
ENDORSEMENT ON COSTS
[1] This appeal was heard December 6, 2006. The detailed reasons for decision were released on December 13, 2006. The parties agreed that costs would be determined by way of written submissions. Those submissions were delivered on behalf of the parties. I have reviewed those written submissions together with my reasons for decision.
[2] The appellant was unsuccessful at trial before Deputy Judge Winer to recover solicitor’s fees claimed in the amount of $6,879.35.
[3] On appeal, all of the issues raised were decided against the appellant. He was totally unsuccessful on the appeal.
[4] The successful respondent submits that he is entitled to costs on a partial indemnity basis in the amount of $8,076.62 as particularized in the draft bill of costs. The issues raised on the appeal included the following:
(a) the standard of appellate review;
(b) whether the trial judge erred in concluding that the appellant was estopped from seeking payment of further fees beyond the sum of $12,840.00 which he had held in trust;
(c) whether the judge erred in concluding that there was an unreasonable delay in pursuing the claims so as to permit the respondent to successfully defend against the claim based on the equitable doctrine of laches.
It is submitted that the issues were of moderate complexity.
[5] In support of an award of costs, the respondent submits the following:
(a) the appellant is an experienced lawyer who was called to the Bar in 1988. Throughout these proceedings, the appellant was self-represented;
(b) the respondent has comprehension problems. He relied upon his wife for business issues. Both the respondent and his wife are unsophisticated people. The appellant rejected offers to settle made early in the small claims court proceedings which were genuine attempts at compromise;
(c) the appellant, as a lawyer, knew the costs consequences that could be associated with an unsuccessful appeal and, nonetheless, elected to pursue his right of appeal in the face of particular findings of Deputy Judge Winer.
[6] Insofar as the costs outline is concerned, the fees claimed are $5,057.50. The estimated counsel fee for appearance claimed is $2,500.00. Disbursements and GST make up the balance totaling $8,076.62. The hourly rate of Mr. Handler is $275.00 and the hourly rate of his associate is $190.00. The hours spent by Mr. Handler and his associate total 22.5 hours exclusive of the $2,500.00 counsel fee claimed by Mr. Handler for attendance and argument on December 6, 2006.
[7] In addition, there is an amount claimed in the amount of $230.00 in respect of receipt and review of my reasons for decision together with the preparation of costs submissions.
[8] The position taken by Mr. Cosentino is that the amount claimed in the amount of $8,076.62 is grossly disproportionate to the amount of his claim. He submits that the time charged by Mr. Handler is unreasonable as is Mr. Handler’s claim for counsel fees. It is Mr. Cosentino’s position that the principle of proportionality should be applied and that costs should be proportionate to the amount claimed. Once again, Mr. Cosentino had claimed the amount of $6,879.35. He submits that costs should be no more than $1,380.00 to $2,070.00 which represents approximately 20% to 30% of his outstanding invoice.
[9] In support of his position, he relies upon the decision of the Divisional Court in Culligan Springs Ltd. v. Dunlop Lift Truck (1994) Inc., [2006] O.J. No. 1667.
[10] Mr. Cosentino submits that Mr. Handler’s time charged was unreasonable, the principle of proportionality ought to apply, and the expectations of the parties ought to be considered in any award of costs.
[11] It was Mr. Cosentino’s expectation that as experienced counsel, Mr. Handler would know and appreciate that this was an appeal of a small claims court judgment. The onus of overturning the judgment rested with Mr. Cosentino and that overturning the judgment would not be an easy task. Mr. Cosentino submits that opposing counsel should have spent a bare minimum of time preparing a response to the appeal.
[12] I find that the respondent, Roiatti, as the successful party on this appeal is entitled to costs on a partial indemnity basis.
[13] I am guided by the overriding principle that in determining costs the result must be fair, reasonable and within the reasonable expectations of the parties. Determination of costs is not simply a mathematical exercise or mechanical calculation. See: Moon v. Sher (2004), 246 D.L.R. (4th) 440 (C.A.) and Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291 (C.A.).
[14] Further, I am in agreement with the statement of the court in Culligan Springs Ltd. that the principle of proportionality is relevant whether it is the plaintiff or the defendant who was successful. Costs payable by the losing party must be reasonable and proportionate to the amount in dispute.
[15] As stated in Culligan Springs Ltd. at paragraph 33:
The principles of proportionality and the reasonable expectations of the parties are, to a degree, intertwined. The principle of proportionality engages a more objective analysis given the issue and the amount in dispute, whereas the reasonable expectation principle requires the judge to examine the particular facts of the case and the objective expectations of the parties.
[16] The Court of Appeal has confirmed that in deciding what is fair and reasonable, the court should consider what each party would have anticipated would be the costs award they would reasonably be expected to pay if they lost the lawsuit. Culligan Springs Ltd., supra, paragraph 39, Boucher, supra, paragraph 38, Moon, supra, paragraph 35.
[17] In considering the question of reasonableness, I am of the view that the amount claimed by the successful respondent on the appeal at $8,076.62 is excessive. The time spent and the hourly rates combined by counsel for the respondent generate fees well in excess of what is warranted on this appeal. The counsel fee claimed in the amount of $2,500.00 is excessive. That having been said, this appeal was fully argued for 2 hours.
[18] As for the issue of proportionality, I am mindful that the initial claim involved in the amount of $6,879.35. As for the expectations of the parties, I find that the expectations of the parties are the same in that the losing party would be obliged to pay the reasonable costs of the appeal. However, I do not agree with Mr. Cosentino that proportionality and the reasonable expectations of the parties are geared to 20% to 30% of his outstanding claim and should be no more than $1,380.00 to $2,070.00. In hindsight, having lost the appeal, it is easy for Mr. Cosentino to now argue that respondent’s counsel should have spent a bare minimum of time preparing a response to the appeal and therefore the costs claimed by the successful respondent should be slashed dramatically. According to Mr. Cosentino, those costs should represent only 20% to 30% of his initial claim. It is noted that Mr. Cosentino vigorously pursued this appeal. He filed voluminous materials to which Mr. Roiatti was obliged to respond. The appeal was fully argued and Mr. Cosentino on every issued raised was unsuccessful.
[19] Accordingly, in assessing costs to be awarded on this appeal. I am guided by the principles of reasonableness, proportionality and the reasonable expectations of the parties. I am guided by what is fair and reasonable in all the circumstances. What is not fair and reasonable in all the circumstances is the respondent’s claim for costs in the amount of $8,076.62. Neither fair and reasonable is the unsuccessful appellant’s claim that costs are in the range of $1,380.00 to $2,070.00. I do not agree with the respondent’s counsel that to award a lesser amount than the amount claimed would be penalizing the respondent who has been completely successful at trial and on the appeal. While I recognize that the amount sought for costs is on a partial indemnity scale and is a fraction of the actual time spent responding to the appeal, an award in the amount claimed by the successful respondent is not warranted.
[20] Having considered all of the circumstances and the principles stated, an award of costs in favour of the successful respondent in the amount of $3,500.00 inclusive of fees, disbursements and GST is fair and reasonable. This award gives effect to the principles of reasonableness, proportionality and the reasonable expectations of the parties in my view.
[21] Accordingly, Mr. Cosentino is hereby ordered to pay to the respondent the sum of $3,500.00 within 14 days of this order together with any unpaid costs ordered by Deputy Judge Winer at trial.
DiTomaso J.
DATE: January 11, 2007