DATE: 20060925

DOCKET: C41880 C41906

COURT OF APPEAL FOR ONTARIO

RE:

DOUGLAS KERR, S. GRACE KERR AND JAMES FREDERICK DURST (Plaintiffs/Respondents) – and – DANIER LEATHER INC., IRVING WORTSMAN, JEFFREY WORTSMAN AND BRYAN TATOFF (Defendants/Appellants)

BEFORE:

LASKIN, GOUDGE and BLAIR JJ.A.

COUNSEL:

Peter R. Jervis, George S. Glezos, Jasmine T. Akbarali and Melanie D. Schweizer for Douglas Kerr, S. Grace Kerr and James Frederick Durst

for the appellant

Alan J. Lenczner, Q.C. and

Craig Martin

for Danier Leather inc.

Benjamin Zarnett and Jessica Kimmel for Irving Wortsman, Jeffrey Wortsman and Bryan Tatoff

for the respondent

On appeal from the judgment of Justice Sidney N. Lederman of the Superior Court of Justice dated May 7, 2004.

C O S T S E N D O R S E M E N T

[1] We have received and considered the written submissions filed by the parties concerning the costs of both the trial and the appeal in this matter.

[2] The appellants ask for costs of the appeal on a partial indemnity basis, against the respondent, the representative plaintiff Durst. They request that we fix those costs. The appellants Wortsman and Tatoff seek an amount of $181,986.84, inclusive of fees, disbursements, and G.S.T. The appellant Danier Leather Inc. seeks $150,000.00. In addition, the appellants ask for costs of the trial on a partial indemnity scale, to be assessed.

[3] The respondent argues that there should be no costs of the appeal and that the costs of the trial should be referred back to the trial judge. He argues that this case raises a novel point of law and involves a matter of public interest.

[4] The Ontario class action legislation recognizes that courts are to approach the issue of costs in class actions using the same general discretion as in ordinary actions, but may also consider whether the class proceeding was a test case, raised a novel point of law, or involved a matter of public interest. See Class Proceedings Act, 1992, S.O. 1992, c. 6.

[5] Here only the last two are of these need to be considered. In our view, neither are at play in this litigation. It involves established principles of statutory interpretation, implied representation, and judicial regard for the business judgment of management. While the context may be new, this is not enough to turn any of the issues into a novel point of law. Moreover, the case does not raise issues of general interest or importance to the public at large.

[6] Rather it is a commercial dispute between sophisticated commercial actors who are well resourced. The representative plaintiff’s claim is, in essence, that the substantial gain he made through his shareholdings of the corporate appellant (approximately $1.5 million), should have been even greater. This is not a case of personal injury or one that raises public law issues; nor is it a contest characterized by significant power imbalance.

[7] We therefore see no basis for departing from the usual approach to costs in this court. Thus, we would award costs of the appeal to the individual appellants and the corporate appellant payable by the respondent Durst on a partial indemnity basis. Given that this was a five-day appeal with complex issues, we find the amount of $100,000.00 plus G.S.T. to be reasonable in each case. In addition, the appellants Wortsman and Tatoff have claimed and should be awarded their disbursements in the amount of $4,349.03 together with G.S.T.

[8] We take the same approach to costs of the trial. The costs orders for the dismissal of the appellants’ motion for summary judgment and for the certification motion should remain unaltered because they constitute discrete and important chapters of this litigation in which the respondents succeeded. However there is no basis to deprive the appellants of their costs of the trial from after December 2, 2002 when the certification order was signed. These costs should be on a partial indemnity basis and should be assessed and, we would so order.

“John Laskin J.A.”

“S.T. Goudge J.A.”

“R.A. Blair J.A.”