Court File and Parties

Court File No.: 79157/06 Released: 20080214

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

Re: BROWNHALL et al., Plaintiffs (Respondents in Appeal) -and- HER MAJESTY THE QUEEN IN RIGHT OF CANADA (MINISTRY OF NATIONAL DEFENCE), Defendant (Appellant)

Before: Cunningham A.C.J.S.C., Taliano and Swinton JJ.

Counsel: Susan E. Healey for the Plaintiffs (Respondents on Appeal) Joel Levine for the Defendant (Appellant)

Heard at Newmarket: By written submissions

COSTS ENDORSEMENT

Swinton J.:

[1] The Crown seeks costs of the initial pleadings motion ($15,000.00), the motions for leave to appeal ($3,000.00) and the appeal ($5,000.00) in the total amount of $23,000.00. It claims to have succeeded in a number of ways: in having significant portions of the action struck, in obtaining an interpretation of s. 9 of the Crown Liability and Proceedings Act (“CLPA”) rejecting an argument that intentional acts of misfeasance are excluded, in obtaining a stay under the Pension Act, and in having the scale of costs reduced in the motion below.

[2] The respondent takes the position that he was generally successful in the motion and on the appeal and should receive costs for both in the amount of $46,669.58 for the motion and $5,874.95 for the appeal. In addition, he submits that there should be no costs for the motions for leave to appeal. Essentially, he argues that the Crown was generally unsuccessful in the Rule 21 motion, and that the stay is not a victory for the Crown, but a neutral event that may or may not affect the action.

[3] In my view, the Crown errs in characterizing the decision on appeal as striking significant portions of the action. The only claims struck were for damages relating to the actual assault in Afghanistan. Claims for what occurred subsequently have not been struck, as the majority of the Court held that it was not plain and obvious that the claims were barred under ss. 8 and 9 of the CLPA.

[4] The Crown did succeed in its argument that the costs before the motions judge should have been on a partial indemnity basis, and the Court rejected the respondent’s argument that intentional acts of misfeasance remove claims from the purview of s. 9 of the CLPA. As well, it succeeded in its claim that the action should be stayed pending a determination of a pension claim.

[5] In my view, success on the appeal was divided. Therefore, there should be no costs of the appeal. Nor should there be costs for the motions for leave to appeal, given that success was divided on the appeal. Moreover, there was one issue in the first motion for leave to appeal, the claim based on a fiduciary relationship, on which the appellant was unsuccessful in obtaining leave.

[6] The more difficult issue is the appropriate disposition of costs of the motion before the motions judge. Normally, if an appeal is allowed, the successful party will receive costs of the appeal, as well as the costs below. Here, however, there has been mixed success on the appeal.

[7] Moreover, even with respect to the motion, the result is mixed. At the hearing of the motion, there were six days of argument, with five taken up by the Crown. The respondent was successful on the Rule 21 motion before the motions judge, and the motions judge’s conclusions on the Rule 21 issue were largely upheld on appeal, with the exception of the portions struck related to a claim for damages for the actual assault. In addition, leave to appeal was denied with respect to his ruling on the fiduciary relationship claim, so the respondent also succeeded before the motions judge on that issue.

[8] The Crown was successful on appeal with respect to the stay under the Pension Act. However, as the Crown acknowledges, it is impossible to know at this stage whether any factual basis for the claim will survive the determination of the pension claim. Therefore, the respondent correctly states that it is impossible to characterize the granting of a stay as a successful outcome for the Crown.

[9] In my view, the respondent achieved substantial success on the motion, even in light of the disposition of the appeal. Therefore, he should be awarded costs of the motion.

[10] In the reasons of the majority on the appeal, I wrote that $36,000.00 would have been an appropriate amount, on a partial indemnity basis, for the motions judge to have awarded for fees in light of his conclusions. However, that is not an appropriate amount to award now, given the outcome of the appeal.

[11] As a result of the appeal, part of the respondent’s claim has been struck, although he has largely succeeded on the Rule 21 motion, and the action is stayed pending the new pension application. Therefore, while I would award him cost of the original motion, I would reduce the amount awarded by 25% to reflect his partial success.

[12] Costs of the motion are fixed in the amount of $27,000.00 plus GST plus disbursements of $537.72, payable to the respondent within 30 days. There will be no costs of the appeal and motions for leave to appeal.

Swinton J.

Cunningham J.

Taliano J. (dissenting):

[11] In earlier reasons for judgment I expressed my views with respect to the costs order made by Marchand J. in this matter. It now remains for me to address the issue of costs pertaining to the motions for leave to appeal and the appeal itself. With respect to the former, I agree with the majority, that there should be no order as to costs for the reasons given. However, I am unable to agree with the majority opinion with respect to the costs of the appeal.

[12] The Crown initially moved to strike all of the statement of claim or in the alternative, it moved to stay proceedings. In its Notice of Appeal to this court, the Crown again sought an order to strike all the statement of claim or alternatively, an order staying the action.

[13] The order the appellant achieved in this court led to the striking of a very minor and narrow portion of the statement of claim (i.e. subparagraph 1A(b) and 42 relating to the assault and reference to hazing rituals) and an order temporarily staying the action. The vast majority of the plaintiff’s claims remain intact after this spirited and expensive attack. During the course of the hearing, the vast majority of the time in argument was spent on submissions relating to the striking of the statement of claim. Very little time was spent on the stay argument, which was not vigorously contested by the respondent.

[14] Given the modest success achieved by the appellant, the respondent must be regarded as the winner of the appeal and is therefore entitled to a costs order that is proportionate to the degree of success achieved.

[15] The respondent’s costs have been submitted in the sum of $7,343.69. Given the complexity of the matter, the length of the hearing, the disparate economic circumstances of the parties, the questionable procedural choice of the Crown in mounting a rule 21 attack in a matter that required supporting affidavit material, the public policy considerations of accommodating impecunious litigants and the evolving state of the law with regard to the immunity provisions of the CLPA, I would award the respondent reduced costs of the hearing in this court of $5,874.95 payable forthwith.

Taliano J.

Released: February 14, 2008