Court File and Parties

COURT FILE NO.: CV-20-28653 DATE: 20240305 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN: Lana Ingratta, Plaintiff – and – Craig McDonald, Defendant

Counsel: Steven D. Bezaire, Counsel for the Plaintiff Meredith Harper and Anthony Naples, Counsel for the Defendant

HEARD: In Writing

COSTS ENDORSEMENT

MACFARLANE J.

[1] In my reasons for decision released January 17, 2024 (Ingratta v. McDonald, 2024 ONSC 371), I dismissed the plaintiff’s claim in this simplified procedure action following a summary trial. In doing so, I granted the defendant’s threshold motion and invited the parties to make written submissions as to costs if they were unable to agree. I also found that the defendant was negligent and had caused certain physical and psychological injuries to the plaintiff, and provisionally assessed her general damages at $50,000 prior to any statutory deductible. I found that no evidence had been led to support the plaintiff’s claim for special damages, including any claim for healthcare expenses.

[2] The defendant has made written costs submissions, but the plaintiff has not. According to communication from plaintiff’s counsel received by the Court, his retainer has been terminated and no submissions will be made on the plaintiff’s behalf.

[3] This action was commenced on January 27, 2020 under Rule 76 of the Rules of Civil Procedure. The plaintiff sought damages of $200,000.00, together with costs and interest, being the maximum amount of claim for which the simplified procedure is mandatory (Rule 76.02(1)).

[4] On the issue of costs, Rules 1.04(1.1) (proportionality), 49 (offers to settle), and 57.01 (factors in discretion on costs) apply, but this action is also subject to an upper limit for costs set out in Rule 76.12.1, which provides:

1. Except as provided for under rule 76.13 or an Act, no party to an action under this Rule may recover costs exceeding $50,000 or disbursements exceeding $25,000, exclusive of harmonized sales tax (HST).
2. Subrule (1) does not apply in the case of an action that was commenced before January 1, 2020.
3. The defendant has submitted a bill of costs which demonstrates actual costs including fees of $81,996.50 and disbursements totaling $42,337.07, both exclusive of HST and both well in excess of the cap imposed by Rule 76.12.1. I note that the fees include travel time from the defendant’s lawyers’ offices in Markham to Windsor, and the disbursements include travel expenses totaling $5,711.08 (excluding local Ubers and taxis), and fees relating to one expert in the amount of $25,792.25. The defendant seeks costs to be fixed in the maximum amount permitted by Rule 76.12.1, which amounts to $84,750 inclusive of fees, disbursements, and HST.

[5] Paragraph 15 of the defendant’s costs submissions, and the e-mail correspondence attached at tab 12 of the submissions, reflect the post-trial without prejudice discussions about costs that are quite obviously privileged. It was highly improper for these materials to have been included in the submissions, and they are struck out.

[6] The defendant made two offers to settle in writing before trial that are relevant:

a. On August 2, 2022, the defendant offered a dismissal of the action without costs if accepted by August 29, 2022, and with escalating costs payable by the plaintiff to the defendant if accepted thereafter, which expressly expired one minute after the first witness is called to testify to trial; and, b. On June 20, 2023, the defendant offered to pay the plaintiff $1,094.75 for disbursements in exchange for a release (with no timeframe for acceptance).

[7] Apart from offering to pay a small amount toward the plaintiff’s disbursements, the defendant never offered to pay anything for the injuries he caused, even at a mediation. On August 15, 2022, the plaintiff made a “Rule 49” offer to settle for $150,000 plus interest and costs.

[8] In considering the factors set forth in Rule 57.01, I find as follows:

a. The experience of Ms. Harper and Mr. Naples, and the hourly rates charged, are reasonable. The hours spent are excessive, because of travel time that could have been avoided by the employment of local counsel. This was not a case that warranted two counsel representing the defendant at trial. b. Without the benefit of submissions from the plaintiff, it is difficult to know what she could reasonably have expected to pay, but she should have known that her maximum exposure would be the amount sought by the defendant, which is $84,750 all-inclusive. There is no suggestion that the defendant complied with Rule 57.01(6) by delivering a costs outline prior to trial. c. The plaintiff claimed $200,000 and recovered $0. d. Liability was apportioned 100% to the defendant. e. The proceeding was not particularly complex. f. The proceeding was important to the plaintiff, who suffered injuries caused by the defendant. The proceeding would not have been of particular importance to the defendant or his insurer. g. I accept that the plaintiff’s failure to answer certain undertakings on discovery resulted in the unnecessary expense of a motion brought by the defendant. The issue of liability was contested at trial, and in my respectful view should have been conceded by the defendant. Similarly, the plaintiff should not have persisted in a claim for special damages when there was no evidence to support such a claim. In my view, the conduct of the parties with respect to these items is a neutral factor. h. I do not believe either party was guilty of any impropriety, except for the reference to privileged settlement discussions in the defendant’s costs submissions set out above. i. As set out above, liability should have been admitted, and without any evidence the plaintiff should have abandoned any claim for special damages. j. (and h.1) These factors are irrelevant. k. The defendant spent nearly $125,000 (plus HST) defending this action, which is $50,000 more than it could possibly recover in costs. The claim was brought for injuries that were clearly caused by the defendant, and which to at least a certain extent were acknowledged by the defendant’s own expert. In my view, this level of spending reflects a scorched earth approach to litigation that is anathema to resolution of disputes. It is not proportionate to the importance and complexity of the issues, and the amount that the defendant must have understood to have been genuinely involved in the proceeding. Moreover, I note that from the unchallenged evidence of the plaintiff, she lives in subsidized housing and the bulk of her income comes from social assistance payments.

[9] In my view, the maximum award for costs under Rule 76.12.1 should be reserved for cases of higher complexity, or situations where an award of substantial indemnity costs is clearly warranted. In this case, neither party made serious efforts to resolve this case on any kind of economically rational basis. Given the significant risk for both parties surrounding the threshold issues, it would have been sensible for the plaintiff to make a more reasonable offer to settle, and for the defendant to offer some amount of compensation for the injuries he caused.

[10] In consideration of the applicable rules and the factors set out above, I exercise my discretion to award costs to the defendant against the plaintiff, fixed in the amount of $45,000.00 inclusive of fees, disbursements, and HST.

Original Signed by “Justice J.R. Macfarlane” J. Ross Macfarlane Justice Released: March 5, 2024

COURT FILE NO.: CV-20-28653 ONTARIO SUPERIOR COURT OF JUSTICE BETWEEN: Lana Ingratta and Craig McDonald RULING ON MOTION Macfarlane J. Released: March 5, 2024