Court of Appeal for Ontario

Citation: Burhoe v. Mohammed, 2012 ONCA 499 Date: 2012-07-11 Docket: C55059

Rouleau, Watt and Pepall JJ.A.

Between:

Derrick Burhoe Plaintiff (Respondent)

and

Abdenuce Mohammed, Budget Car Rentals Toronto Ltd. Defendants (Appellants)

Counsel: Chris G. Paliare, for the defendants (appellants) Mark A. Klaiman, for the plaintiff (respondent)

Heard & released orally: June 29, 2012

On appeal from the order of Justice Gordon Lemon of the Superior Court of Justice, dated August 15, 2011, with reasons reported at 2011 ONSC 4853.

Endorsement

[1] The plaintiff claimed damages in excess of $1 million as a result of a motor vehicle accident. Included were claims for general damages, past income loss, past housekeeping loss, future income loss and future housekeeping loss.

[2] After a 16 day trial, the jury awarded the plaintiff general damages of $54,000 and past income loss of $11,000. Nothing was awarded for the remaining three heads of damages. In addition, there was a $15,000 deductible pursuant to s. 267.5(7)3 of the Insurance Act, R.S.O. 1990 c. I.8, that was to be applied to reduce the award of damages to $50,000.

[3] The trial judge set aside the jury verdict as perverse and ordered a new trial. The trial judge then proceeded to fix the costs in favour of the plaintiff in the amount of $196,695.

[4] The defendants appealed to this court on both the setting aside of the jury verdict and on the issue of costs. The appellants advanced two arguments on the costs appeal. First, they argued that costs should not have been determined until after the second trial. Second, they argued that due regard was not paid by the trial judge to the principle of proportionality given the limited amount awarded by the jury.

[5] This court reinstated the jury’s verdict, set aside the costs award and remitted the matter of costs to the trial judge. The trial judge then carried out a new assessment of costs and once again assessed costs at $196,695.

[6] The appellants ask that this second costs order be set aside and that this court fix the costs. They suggest a sum of $50,000 plus disbursements of $53,290. They argue that the second costs order is inconsistent with this court’s decision in the earlier appeal and that the trial judge failed to consider and apply the proper principles, in particular, the principle of proportionality.

[7] The trial judge’s reasons in large measure repeated the reasons he gave when he made the first costs award. In support of his decision he referred to the case of Dennie v. Hamilton (2008), 2008 ONSC 5964, 89 O.R. (3d) 542, a case similar to the present case. In Dennie, recovery by the plaintiff at trial was for an amount substantially below the amount claimed, but exceeded any offer made by the defendant in that case. In Dennie, the trial judge recognized that a trial was necessary because of the inadequate settlement offer. Although the plaintiff only recovered about $40,000, balancing the interests on the issue of costs the trial judge nonetheless awarded approximately $106,000 in costs. This represented a reduction in the costs sought by the plaintiff of about $34,000.

[8] In the present case we agree with the trial judge that having recovered more than the offers of settlement, the plaintiff is entitled to costs. However, in our view, the amount awarded by the trial judge cannot stand. In light of the previous decision of this court setting aside his earlier costs award, the principle of proportionality made a reduction in the plaintiff’s costs, similar to the reduction made in Dennie, necessary and appropriate.

[9] The appeal is allowed and the award of costs is reduced from $196,695 to $166,695. The appellants are awarded costs of the appeal fixed at $7,500 inclusive of disbursements and applicable taxes.

“Paul Rouleau J.A.”

“David Watt J.A.”

“S.E. Pepall J.A.”