Court File and Parties

COURT FILE NO.: CV-22-00689804-0000 DATE: 20231116 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: XIAMEN INTERNATIONAL TRADE GROUP CO., LTD., Applicant AND: LINKGLOBAL FOOD INC., Respondent

BEFORE: VERMETTE J.

COUNSEL: David T. Woodfield, for the Applicant Wei Jiang, for the Respondent

HEARD: November 15, 2023

Endorsement

[1] The Applicant seeks the recognition and enforcement of the arbitration judgment of the Xiamen Arbitration Commission (“Commission”) dated September 1, 2021 (“Award”) under the UNCITRAL Model Law on International Commercial Arbitration (“Model Law”).

[2] At the hearing, the Respondent sought an adjournment, which was objected to by the Applicant. I denied the adjournment, with reasons to follow.

[3] I then proceeded to hear counsel’s submissions regarding the Application. I granted the Application, with reasons to follow.

[4] My reasons are set out below.

A. Factual Background

1. The Arbitration

[5] The Applicant carries on business in China and elsewhere. The Respondent carries on business in Ontario and elsewhere.

[6] On February 6, 2020, the parties entered into a contract providing that the Applicant would purchase protective masks from the Respondent for the purchase price of US $532,224.00 (“Contract”). Clause 6 of the Contract contains an arbitration agreement. It reads as follows:

6. SETTLEMENTS OF DISPUTES:

All disputes arising from or in connection with this contract or the execution thereof shall be settled through friendly negotiations. In case no settlement can be reached through negotiation, both parties shall have the right to apply to XIAMEN ARBITRATION COMMISSION. The award made by the arbitration commission shall be taken as final and binding upon both parties.

[7] The Contract also provides that the law of the People’s Republic of China governs all aspects of the Contract, including its validity, interpretation, performance and enforcement.

[8] On January 13, 2021, the Applicant commenced arbitral proceedings against the Respondent by submitting an application for arbitration to the Commission pursuant to clause 6 of the Contract. The Applicant was seeking a refund of the purchase price of the masks as well as compensation for various costs incurred on the ground that the protective masks sold by the Respondent were expired and not usable.

[9] The Respondent served a statement of response to the application for arbitration on May 14, 2021.

[10] A panel of three arbitrators – one selected by the Applicant, one selected by the Respondent and one designated by the Director of the Commission in accordance with the Commission’s Arbitration Rules – heard the case on May 23, 2021. The Respondent participated in the arbitration.

[11] The Commission delivered a unanimous decision on September 1, 2021. It rendered the following judgment:

a. The Respondent shall, within 10 days of service of the Award, refund to the Applicant the payment for goods in the amount of US $535,194.00 plus interest (the interest is based on US $535,194.00, calculated at 1.3 times of one-year loan market quotation rate, from April 10, 2020 to the date of actual repayment in full by the Respondent, and is US $19,814.60 as of January 4, 2021).

b. The Respondent shall, within 10 days of service of the Award, compensate the Applicant 663,252.62 Yuan for the customs value-added tax and freight.

c. The Respondent shall, within 10 days of service of the Award, pay to the Applicant 45,000.00 Yuan for lawyer’s fees.

d. The Respondent shall, within 10 days of receipt of the Award, directly pay 45,874.80 Yuan of the arbitration fee advanced by the Applicant to the Applicant.

e. Should the Respondent fail to perform the obligation of pecuniary payment within the period specified in the Award, it shall pay interest for the duration of delay in performance in accordance with the provisions of relevant laws.

[12] The Respondent has not made the payments set out in the Award, and has not commenced any motion or application to have the Award varied or set aside.

2. The Application

[13] This Application was commenced on October 26, 2022. On or about December 1, 2022, counsel for the Applicant sent a requisition to schedule the Application. It is stated in the requisition form that the requisition was sent by courier to the Respondent for the purposes of consultation on November 10, 2022, and that counsel for the Respondent, Robert Hine, provided a response on November 28, 2022. On December 1, 2022, Justice Myers ordered that the Registrar assign a date for the hearing of the Application. The Application was scheduled to be heard on November 15, 2023, almost one year later.

[14] I note that the requisition states that the Notice of Application had already been served. It also includes the following proposed timetable:

a. Application Record to be served by December 12, 2022.

b. Responding Application Record to be served by December 23, 2022.

c. Reply Application Record, if any, to be served by January 10, 2023.

d. Examinations of non-party witnesses, if any, to be completed by February 28, 2023.

e. Cross-examinations on affidavits to be completed by April 28, 2023.

f. Factums to be exchanged by October 20, 2023.

[15] This timetable was not adhered to. The Application Record is dated January 23, 2023. The Respondent has not served any responding materials.

3. Evidence of the Respondent’s Former Counsel

[16] Robert Hine, the lawyer originally retained by the Respondent in relation to this Application, swore an affidavit on November 9, 2023. He states that he ceased being counsel for the Respondent on November 2 or 3, 2023. Mr. Hine’s associate, Sara Fahmi, also swore an affidavit on November 9, 2023. Both Mr. Hine and Ms. Fahmi refer in their affidavits to the lawyer retained by the Respondent in China for the arbitration, Mr. Shouzhi An.

[17] Among other things, Mr. Hine states the following in his affidavit:

I have been further advised by [the Respondent’s representative, Daniel Chen], and verily believe, that his lawyer, An, was critical of the Arbitration process, which included the withholding of relevant documentary evidence and the destruction of assets before meaningful inspection or testing could be conducted.

I intended to oppose the application on the grounds that:

a. [The Respondent] was not provided with at least one key document until after the conclusion of the Arbitration hearing;

b. [The Respondent’s] representative was denied access to at least part of the Arbitration hearing;

c. [The Applicant] breached both contract and statutory laws of the People’s Republic of China by:

i. Failing to inspect a shipment of medical masks received from the Respondent within a reasonable time;

ii. Failing to honour an agreement to return thousands of medical masks to LinkGlobal; and

iii. Destroying those masks after only cursory and incomplete testing by the Applicant and before the masks could be tested by the Respondent.

I expected to receive assistance, including both affidavit and documentary evidence, from An to support my theory of the case and to determine if there were additional grounds on which to object to the enforcement of the [Award] in Ontario.

[18] Ms. Fahmi’s affidavit contains a slightly different theory of the case. She states the following:

We intended to oppose the application on the grounds that LinkGlobal was not provided with at least one key document until after the conclusion of the Arbitration hearing, that LinkGlobal’s representative, Daniel Chen (“Chen”) was denied access to that hearing, and on other actions and omissions that constituted a denial of natural justice.

[19] On September 12, 2023, Mr. Hine asked Ms. Fahmi to contact Mr. An to ask him about his concerns regarding the arbitration process and procedure, to obtain documents from his file and to draft an affidavit for him to swear. Mr. Hine’s request was made more than nine months after the Application was scheduled, and approximately two months before the hearing of the Application.

[20] Ms. Fahmi wrote to Mr. An on September 15, 2023. She sent a follow-up e-mail on September 21, 2023. Mr. An responded on September 22, 2023, and a videoconference was scheduled for September 26, 2023. Ms. Fahmi states the following in her affidavit regarding her discussion with Mr. An on September 26, 2023:

During the course of that meeting, An confirmed that he had represented LinkGlobal and provided me with an overview of the Arbitration. He also summarized some of his concerns about the Arbitration, including that:

a. [The Applicant] had breached an agreement that it had made with LinkGlobal to return unused medical masks, which had initially been supplied by LinkGlobal;

b. Contrary to this agreement, the masks were destroyed before LinkGlobal could have them inspected;

c. [The Applicant] appears to have conducted only a cursory and inconclusive investigation of the quality of the masks before they were destroyed;

d. The Provincial Ministry of Commerce, which destroyed the masks, did not have the authority to do so; and

e. [The Applicant] was estopped from arguing that it is entitled to a refund since [the Applicant] breached its agreement to return the masks.

An also informed me that [the Applicant] had withheld an agency agreement between itself and the Provincial Ministry of Commerce which, in An’s opinion, was a very important document. An told me that this document was only provided to him after the conclusion of the Arbitration despite his requests for timely production of all relevant documents.

[21] On September 26, 2023, several hours after the videoconference, Ms. Fahmi sent the following e-mail to Mr. An:

Hello Mr. Shouzi An,

Thank you for the teams meeting.

Would you be willing to swear a short affidavit giving details of the following:

1. You asked for the agency agreement
2. Who you asked the agreement from
3. It was not provided to you before the arbitration
4. Why you thought the agreement was important
5. When the decision was released
6. That the agreement was released later
7. Who released the agreement later

Thank you,

Sara

[22] Given that Ms. Fahmi did not receive a response to her e-mail, she sent a follow-up e-mail to Mr. An on October 2, 2023. She never heard back from Mr. An.

[23] In mid-October 2023, Mr. Hine asked Mr. Chen, the Respondent’s representative, to speak to Mr. An to see if he could convince Mr. An to provide the information requested by Mr. Hine. Mr. Hine states in his affidavit that he concluded in late October 2023 that the Respondent would only be able to secure Mr. An’s assistance if he were ordered to do so. Mr. Hine concludes his affidavit as follows:

I do not speak Mandarin and do not know the various procedural mechanisms that may exist in China whereby a client can obtain information from its former counsel.

I therefore recommended to the Respondent, in another privileged communication, that it retain counsel who is fluent in Mandarin, has active connections in China who might be able to commence proceedings to obtain An’s file and summon An as a witness, and who has an excellent professional reputation.

I understand that the Respondent has now done so.

B. Discussion

1. General Principles Applicable to the Recognition and Enforcement of Arbitral Awards

[24] In Ontario, foreign arbitral awards are enforceable through the International Commercial Arbitration Act, 2017, S.O. 2017, c. 2, Sched. 5 (“ICAA”). The ICAA provides that the Model Law has force of law in Ontario. The Model Law is set out in Schedule 2 to the ICAA. The Model Law applies to international commercial arbitration and is applicable in this case given that the parties have their places of business in different countries: see Articles 1(1) and 1(3)(a) of the Model Law.

[25] The Model Law restricts the ability of national courts to interfere with international arbitration proceedings. Articles 35 and 36 of the Model Law relate to the recognition and enforcement of arbitral awards. Article 36 limits the grounds on which enforcement of an international arbitral award may be refused.

[26] Articles 35 and 36 of the Model Law provide as follows (as modified by subsection 6(1) of the ICAA):

Article 35. Recognition and enforcement

(1) An arbitral award, irrespective of the country in which it was made, shall be recognized as binding and, upon application in writing to the competent court, shall be enforced subject to the provisions of this article and of article 36.

(2) The party relying on an award or applying for its enforcement shall supply the original award or a copy thereof. If the award is not made in an official language of Canada, the court may request the party to supply a translation thereof into such language.

Article 36. Grounds for refusing recognition or enforcement

(1) Recognition or enforcement of an arbitral award, irrespective of the country in which it was made, may be refused only:

(a) at the request of the party against whom it is invoked, if that party furnishes to the competent court where recognition or enforcement is sought proof that:

(i) a party to the arbitration agreement referred to in article 7 was under some incapacity; or the said agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of the country where the award was made; or

(ii) the party against whom the award is invoked was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case; or

(iii) the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration, provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, that part of the award which contains decisions on matters submitted to arbitration may be recognized and enforced; or

(iv) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties or, failing such agreement, was not in accordance with the law of the country where the arbitration took place; or

(v) the award has not yet become binding on the parties or has been set aside or suspended by a court of the country in which, or under the law of which, that award was made; or

(b) if the court finds that:

(i) the subject-matter of the dispute is not capable of settlement by arbitration under the law of Ontario and any laws of Canada that are in force in Ontario; or

(ii) the recognition or enforcement of the award would be contrary to the public policy of Ontario.

(2) If an application for setting aside or suspension of an award has been made to a court referred to in paragraph (1)(a)(v) of this article, the court where recognition or enforcement is sought may, if it considers it proper, adjourn its decision and may also, on the application of the party claiming recognition or enforcement of the award, order the other party to provide appropriate security.

[27] The grounds for refusing recognition or enforcement set out in the Model Law are to be construed narrowly: see Popack v. Lipszyc, 2018 ONCA 635 at para. 40.

[28] The grounds for refusing recognition or enforcement of an international arbitral award are substantially the same as the grounds to set aside such an award set out in article 34(1) of the Model Law. Courts have held that to justify setting aside an arbitral award under the Model Law for reasons of fairness or natural justice, the conduct of the arbitral tribunal must be sufficiently serious to offend our most basic notions of morality and justice. Judicial intervention for alleged violations of the due process requirements of the Model Law will be warranted only when the tribunal’s conduct is so serious that it cannot be condoned under Ontario law. See Consolidated Contractors Group S.A.L. (Offshore) v. Ambatovy Minerals S.A., 2017 ONCA 939 at para. 65; application for leave to appeal dismissed: and All Communications Network of Canada v. Planet Energy Corp., 2023 ONCA 319 at paras. 42, 48.

[29] In Nelson v. The Government of the United Mexican States, 2022 ONSC 1193 at para. 34 (“Nelson”), the Court stated that a party may be said to have been “unable to present their case” when:

a. the award is based on a theory of liability that either or both of the parties were not given an opportunity to address, or based on a theory of the case not argued for by either of the parties;

b. a party was not given an opportunity to respond to arguments made by an opposing party; or

c. the tribunal ignored or failed to take the evidence or submissions of the parties into account.

[30] A party is not permitted to review the award on its merits under the guise of alleged breaches of Article 34(2)(a)(ii) of the Model Law. Where a party merely disagrees with the outcome, the court should not permit re-argument of the merits in the guise of a claim for breach of procedural fairness. See Nelson at para. 35.

2. Request for an Adjournment by the Respondent

[31] At the hearing, the Respondent’s new counsel asked for an adjournment of the Application. Counsel for the Applicant was advised that an adjournment was going to be sought approximately one week before the hearing of the Application. The affidavits of Mr. Hine and Ms. Fahmi were subsequently served on the Applicant in support of the request for an adjournment.

[32] At the hearing, the Respondent’s new counsel mentioned additional grounds (i.e., grounds that are not mentioned in the affidavits of Mr. Hine and Ms. Fahmi) that could potentially be raised to object to the enforcement of the Award, including the fact that the Commission apparently did not hear evidence of witnesses and the lack of independence of the Commission given that a Chinese government actor was involved.

[33] During the hearing, I asked questions as to whether it would be possible to obtain an order in China compelling Mr. An to give evidence in this Ontario proceeding. While the Respondent’s counsel has had conversations with a lawyer in China regarding the Respondent’s issues with Mr. An, counsel was not able to confirm to this Court that it was possible to obtain an order in China that would compel Mr. An to give evidence in an Ontario proceeding. The Chinese lawyer with whom counsel spoke said that they had to look into this issue. However, the Respondent’s counsel was able to advise that, based on the information received from the Chinese lawyer, a trial that is not complex could be heard within six months in China, and a complex trial could be heard within a year.

[34] In Ariston Realty Corp. v. Elcarim Inc. at para. 34 (Ont. S.C.J.), Justice Perell listed the following relevant factors that a judge may consider when exercising the discretion to grant or refuse an adjournment:

a. the overall objective of a determination of the matter on its substantive merits;

b. the principles of natural justice;

c. that justice not only be done but appear to be done;

d. the particular circumstances of the request for an adjournment and the reasons and justification for the request;

e. the practical effect or consequences of an adjournment on both substantive and procedural justice;

f. the competing interests of the parties in advancing or delaying the progress of the litigation;

g. the prejudice not compensable in costs, if any, suffered by a party by the granting or the refusing of the adjournment;

h. whether the ability of the party requesting the adjournment to fully and adequately prosecute or defend the proceeding would be significantly compromised if the adjournment were refused;

i. the need of the administration of justice to orderly process civil proceedings; and

j. the need of the administration of justice to effectively enforce court orders.

[35] After weighing the factors set out above, I concluded that the adjournment requested by the Respondent should be denied.

[36] In my view, the factor of the circumstances of the request for an adjournment and the reasons and justification for the request is a very important factor in this case, for a number of reasons. First, even though the Respondent has known about this Application for almost a year, it does not currently have evidentiary support for any valid ground to oppose the enforcement of the Award, and it only started to investigate whether it could obtain such support more than nine months after the Application was scheduled, and only two months prior to the hearing of the Application. This was extremely late and, assuming that the Respondent could have obtained evidence in a very short period of time, this left very little time (and likely insufficient time) for reply evidence, cross-examinations and the exchange of factums. No explanation has been provided for this lack of diligence. The conduct of the Respondent in this case also undermines two of the factors listed above: the need of the administration of justice to orderly process civil proceedings, and the need of the administration of justice to effectively enforce court orders, here, scheduling orders.

[37] Second, the affidavits of Mr. Hine and Ms. Fahmi filed in support of the request for an adjournment are largely based on hearsay and, at times, double hearsay. The Respondent’s representative could have provided more direct evidence, including direct evidence with respect to some of the alleged grounds, e.g., the ground that Mr. Chen was denied access to at least part of the hearing. I draw an adverse inference from the absence of any evidence from the Respondent.

[38] Third, while the Respondent would like an adjournment to obtain certain evidence to respond to the Application, the proposed grounds to resist the enforcement of the Award that are set out in the evidence filed by the Respondent do not appear to have any air of reality. Most of the grounds mentioned in the affidavits of Mr. Hine and Ms. Fahmi refer to substantive issues that were before the Commission, that were considered by the Commission and on which the Commission ruled. [^1] While Mr. An and the Respondent may disagree with the outcome of the arbitration, they are not entitled to reargue the merits of the case in an application to enforce the Award.

[39] As for the ground that Mr. Chen was denied access to at least part of the hearing, he could have provided evidence on this point, but he did not, as stated above. There is no explanation for the absence of evidence on his part, and it cannot be explained by any difficulty with Mr. An. Further, there is no indication in the Award that the Applicant requested that Mr. Chen be able to attend the hearing and that such request was denied. There is also no evidence that the parties were not treated in the same manner with respect to access and/or that the exclusion of the parties was contrary to the Commission’s rules and procedures.

[40] With respect to the document that Mr. An allegedly received after the arbitration, which is said to be an agency agreement, it is clear from the affidavit of Ms. Fahmi and Ms. Fahmi’s e-mail to Mr. An dated September 26, 2023 that Mr. An had requested this document prior to the arbitration. However, there is no allegation and no indication in the Award that Mr. An asked the Commission to order the Applicant to produce this document for the purpose of the arbitration. Further, I note that the Commission considered and ruled on the issue of agency and that, again, the Respondent may be trying to reargue the merits of the case.

[41] In addition, any attempt by the Respondent to adduce fresh evidence on this Application (i.e., the document that was allegedly produced after the arbitration) would need to meet the test applicable to the admission of fresh evidence on an application under the Model Law. Such test is the test applicable on an application for judicial review for the admission of fresh evidence: see Vento Motorcycles, Inc. v. United Mexican States, 2021 ONSC 7913 at paras. 44, 50.

[42] Here, given that Mr. An was aware that he had requested a document on the agency issue and that such document had not been produced, he had to show reasonable diligence and raise the issue before the Commission, which he does not appear to have done and there is no suggestion that he did. As stated by Justice Stratas in Bernard v. Canada Revenue Agency, 2015 FCA 263 at para. 26:

I note parenthetically that if the evidence of natural justice, procedural fairness, improper purpose or fraud were available at the time of the administrative proceedings, the aggrieved party would have to object and adduce the evidence supporting the objection before the administrative decision-maker. Where the party could reasonably be taken to have had the capacity to object before the administrative decision-maker and does not do so, the objection cannot be made later on judicial review: […].

[43] Turning to the grounds raised by counsel for the Respondent at the hearing, the fact that no witnesses may have been heard by the Commission does not mean that the Respondent was unable to present its case. There is no suggestion in the Award and no evidence in the record that: (a) the Respondent objected to the procedure adopted by the Commission; or (b) the Commission did not follow its regular rules and procedures. By agreeing in the Contract that any dispute under the Contract would be resolved by way of arbitration before the Commission, the parties agreed to any rules that the Commission may have adopted. The Respondent would have been able to access the arbitration rules adopted by the Commission (which are referred to in the Award) without Mr. An, but it has not put them in evidence in this Application.

[44] Further, I adopt the following statement that I made in Costco Wholesale Corporation v. TicketOps Corporation, 2023 ONSC 573 at para. 82:

[…] However, it would be ill-advised for an Ontario court to find that: (a) a hearing in an international arbitration proceeding that does not sufficiently resemble a trial in an Ontario court proceeding is contrary to Canadian notions of fundamental justice; and (b) a party to such an international arbitration proceeding is unable to present its case. International arbitration awards usually involve parties from different States. The States in question may have different legal traditions (e.g. civil law vs. common law) and different approaches to the resolution of disputes. This was alluded to by the Arbitrator in his Procedural Order No. 10. He also noted that it was not uncommon in international arbitration for a matter to be decided on the documents alone. [Emphasis added.]

[45] Finally, the allegation raised at the hearing regarding the lack of independence of the Commission is based on pure speculation.

[46] The test to show that a party was unable to present its case under the Model Law is very stringent, and the Respondent’s “theory of the case” and proposed arguments do not appear to have a chance of success. This is an important consideration in the balancing of the factors given the significant delay that would be caused by an adjournment and the substantial uncertainty that the Respondent would be able to compel Mr. An to provide evidence in this proceeding or to provide evidence that is relevant to the very limited grounds set out in Article 36 of the Model Law. If an adjournment were to be granted, there is a real possibility that, more than one year from now, the Respondent would not have been able to obtain the evidence for which it seeks an adjournment, thereby creating a long delay for naught.

[47] The significant delay that would be caused by an adjournment is one of the practical consequences of an adjournment and is another important factor to consider, as suggested above. Delay has an impact on the administration of justice. There is a strong public interest in promoting the timely resolution of disputes. Failure to enforce timelines frustrate the legitimate expectations of the parties. See 1196158 Ontario Inc. v. 6274013 Canada Limited, 2012 ONCA 544 at paras. 39-41. In this case, the significant delay caused by an adjournment has to be considered in the light of the time that it took for this Application to obtain a hearing date, i.e., almost one year.

[48] In its response to the adjournment request, the Applicant submitted at the hearing that the Respondent may no longer be operating in January 2015. While I agree with the Respondent that this submission is based on speculation, this and other risks are encapsulated in the notion that justice delayed is justice denied.

[49] It is my view that the Respondent has an interest in delaying this Application. The Respondent’s request for an adjournment, the limited and last-minute evidence filed in support of the request, and the fact that more than two years after the Award was delivered and almost one year after the Application was scheduled the Respondent does not appear to know what its defence is going to be, suggest a party who is grasping at straws to avoid its payment obligations under the Award.

[50] While I realize that denying the adjournment means denying the Respondent the opportunity to file evidence in response to this Application, I find that a weighing of the relevant factors in the particular circumstances of this case favour denying the adjournment, including the conduct and lack of diligence of the Respondent, its failure to file evidence that was available to it (e.g., evidence of Mr. Chen), the real possibility that the Respondent will be unable to obtain evidence from Mr. An, the significant delay that would be caused by an adjournment, the apparent lack of merit of the arguments that the Respondent is proposing to raise, the Respondent’s interest in delaying this Application and the needs of the administration of justice.

3. Recognition and Enforcement of the Award

[51] Based on the evidence before me, I find that the Award should be recognized and enforced in accordance with Articles 35 and 36 of the Model Law.

[52] Further to Article 35(2) of the Model Law, the Applicant has provided a copy of the original Award and a certified English translation of the Award.

[53] Article 36 states that recognition or enforcement of an arbitral award may be refused only based on the grounds set out in Article 36. None of these grounds are present in this case. The Respondent has not furnished proof regarding any of the grounds set out in Article 36(1)(a). Further, I see no indication in the record before me that such grounds could be established in this case. While it is not this Court’s role to deal with the merits of the Award, I note that the Award contains a careful analysis of the parties’ positions and cogent reasoning.

[54] I also find that the grounds set out in Article 36(1)(b) (subject-matter not capable of settlement by arbitration and public policy) are not present in this case.

[55] As a result, the Model Law requires that the Award be recognized and enforced in Ontario.

4. Costs

[56] The Applicant is the successful party and is entitled to costs. Counsel agree that the appropriate scale is partial indemnity. The Applicant seeks costs in the amount of $27,430,64, including $6,403.49 in disbursements, which principally consist of the costs of certified translations. The Respondent argues that the overall amount claimed is excessive and notes, among other things, that numerous timekeepers were involved.

[57] I have reviewed the Applicant’s bill of costs. I find that the rates used by the Applicant’s lawyers are appropriate: they used partial indemnity rates that are 60% of actual rates. With respect to time spent and the overall amount sought, I will apply a reduction to the amount sought to ensure that the overall time claimed is reasonable in light of all the circumstances of this case and to take into account potential duplication of work between the timekeepers involved.

[58] Taking the foregoing into account, as well as the factors set out in Rule 57.01(1) of the Rules of Civil Procedure and the reasonable expectations of the parties, I find that the fair and reasonable award of costs in favour of the Applicant is on a partial indemnity basis in the all-inclusive amount of $19,500.00. In my view, this is an amount that the Respondent should reasonably have expected to pay in the event that it was unsuccessful on the Application.

C. Conclusion

[59] The Respondent’s request for an adjournment is denied.

[60] The Application is granted.

[61] The Respondent is ordered to pay costs on a partial indemnity basis to the Applicant in the amount of $19,500.00 within 30 days.

Vermette J. Date: November 16, 2023

[^1]: These grounds include: (1) the Applicant breached both contract and statutory laws of the People’s Republic of China; (2) the Applicant breached an agreement that it had made with the Respondent to return unused medical masks, which had initially been supplied by the Respondent; (3) contrary to this agreement, the masks were destroyed before the Respondent could have them inspected; (4) the Applicant appears to have conducted only a cursory and inconclusive investigation of the quality of the masks before they were destroyed; (5) the Applicant failed to inspect a shipment of medical masks received from the Respondent within a reasonable time; (6) the Provincial Ministry of Commerce, which destroyed the masks, did not have the authority to do so; and (7) the Applicant was estopped from arguing that it is entitled to a refund since the Applicant breached its agreement to return the masks.