Court File and Parties
Ottawa Court File No.: 13-57696 Date: 2017/07/20 Superior Court of Justice - Ontario
Re: 1550988 Ontario Limited o/a Premier Drycleaners, Plaintiff And: Burnford Realty Limited, Defendant
Before: Madam Justice S. Corthorn
Counsel: David Debenham, counsel for the Plaintiff Andrew J. F. Lenz, counsel for the Defendant
Heard: In Writing
Endorsement
[1] Premier Drycleaners brought a motion for summary judgment, seeking an award of damages and an order for an assignment of a commercial lease. Premier was unsuccessful on the motion. The claim for an assignment of the lease was dismissed. The issue of liability for damages, on the basis of an alleged breach of the lease, was referred for a mini-trial.
[2] The parties were unable to resolve the issue of costs for the motion.
[3] I received and have reviewed the parties’ respective submissions with respect to costs.
[4] Burnford asserts that, as a result of its success on the motion, it is entitled to costs payable within 30 days of the date of this endorsement. Burnford’s position is based on the presumptive rule that costs follow the event.
[5] Burnford also relies on the terms of an offer to settle the motion, served in June 2015. The offer remained open until five minutes after the commencement of the hearing. Burnford argues that the terms of the offer are sufficient to (a) engage Rule 49 of the Rules of Civil Procedure, and (b) entitle Burnford to costs of the motion on a substantial indemnity basis.
[6] Premier responds by way of analogy, likening the summary judgment motion to a single period in a hockey game. Premier questions whether Burnford was successful on the motion, when the outcome of the motion is considered in the context of litigation as a whole.
[7] Premier argues that if Burnford is found to have been successful on the motion, its success is limited and warrants an award of costs payable in the cause.
[8] I agree with that analogy and order that costs of the motion for summary judgment are payable in the cause.
[9] The outright success achieved by Burnford on the motion is the dismissal of Premier’s claim for an order directing Burnford to assign the lease for the drycleaning store in the mall owned by Burnford. The current tenant consented to the assignment. Burnford refused to make the assignment. I found that Burnford acted reasonably in refusing to make the assignment.
[10] The fact that an assignment was not ordered does not bring to an end Premier’s claim for relief related to the alleged breach of the lease. It remains to be determined (a) whether Premier is entitled to damages for the alleged breach of the lease, and (b) if so, the period for which damages are payable. A possible outcome in the action is that Premier is awarded damages for the period that would otherwise have been covered by the assignment of the lease.
[11] At this stage of the action the only final determination is that Premier is not entitled to one form of the relief it sought. The substantive issues and potential entitlement to relief in the form of damages remain to be determined. There has been no final determination of the substantive issues; “the preferable course is to reserve the question of costs to the trial judge.” (See: Accreditation Canada v. Guerra, 2016 ONSC 6184, at para. 9, quoting the Honourable R.J. Sharpe from his text, Injunctions and Specific Performance.)
[12] By following this course, the trial judge will determine the matter of costs of the motion for summary judgment. When doing so, the trial judge will be able to consider whether Burnford was successful on the substantive issues – both on the motion and at trial. The trial judge will also be able to consider whether, in light of the overall outcome in the action, Burnford’s success in having the claim for an assignment of the lease dismissed warrants an award of costs in its favour with respect to that discreet element of Premier’s claims.
[13] There is no prejudice to Burnford if costs are determined in the cause. I remain seized of the matter. The parties are to proceed before me with a mini-trial on the substantive issue of the alleged breach of the lease. I shall have the hindsight referred to in the case law and required to consider (a) Burnford’s position on the substantive issues, and (b) the success achieved or losses based on those positions.
Disposition
[14] I order that the costs of the summary judgment motion are payable in the cause.
Date: July 20, 2017
Madam Justice S. Corthorn