Court of Appeal for Ontario

CITATION: Kruger v. Holubik, 2013 ONCA 305

DATE: 20130508

DOCKET: C55818

BEFORE: Doherty, Cronk and Lauwers JJ.A.

BETWEEN:

Richard Paul Kruger

Applicant (Respondent in Appeal)

and

Michael J. Holubik

Respondent (Appellant)

AND BETWEEN:

Richard Paul Kruger

Plaintiff (Appellant) (Respondent in Appeal)

and

Michael J. Holubik, Patricia Ann Holubik, George Aubrey, Michael Buyers, Sunny Glade Pools and Recreation Inc., Canadian Imperial Bank of Commerce, James Davis, carrying on business as British Billiards, Brian Babcock and Gary Davis, carrying on business as British Billiards International and Hallmark Homes Recreation Centre Limited

Defendants (Appellant)

COUNSEL:

Catherine Ferrari, for the appellant Holubik

Gary E. Shortliffe, for the respondent Kruger

HEARD AND RELEASED ORALLY: May 3, 2013

On appeal from the order of Justice Frank J.C. Newbould of the Superior Court of Justice, dated December 8, 2009.

ENDORSEMENT

[1] The proceedings underlying this appeal were dismissed on consent in August 2008. They had been commenced some 15 years earlier.

[2] When the proceedings were dismissed on consent, the application judge indicated that Mr. Holubik, the respondent in the proceedings, was "entitled to his costs". The application judge ordered written submissions as to quantum.

[3] It is fair to say that when the application judge made this order, he knew little about the nature of the litigation or the long chronology of the litigation.

[4] Three sets of written submissions were eventually filed by Mr. Holubik and two sets by Mr. Kruger. The submissions for both parties went into the history of the acrimonious business relationship underlying the litigation, the details of the 15-year litigation, and offered explanations for various lengthy delays in the litigation.

[5] Counsel for Mr. Kruger took the position in his initial written submissions that despite the application judge's comments when the application was dismissed, Mr. Kruger should not be required to pay any costs.

[6] In his endorsement released in December 2009, the application judge determined that there should be no costs. In coming to that conclusion, he referred to the following:

• the awarding of costs is discretionary;
• the court may have regard to the actions of the parties, either the factual circumstances giving rise to the claims, or their conduct in the proceedings;
• Mr. Holubik had engaged in highly questionable, if not dishonest, practices;
• Mr. Kruger had offered explanations for a lengthy hiatus in the litigation; and
• both parties were responsible for significant delays.

[7] Counsel for the appellant, quite properly in our view, does not submit that the application judge did not have jurisdiction to make an order that there should be no costs despite his initial indication that the respondent was entitled to costs. The application judge was, of course, obligated to afford procedural fairness to the parties. The dictates of procedural fairness would have to take into account the application judge's initial observations as to the appropriate order and any reliance counsel placed on those initial observations in making their submissions. Both parties were entitled to a fair chance to put their positions forward knowing the various potential orders that might be made.

[8] We see no evidence of unfairness to the appellant in the procedure followed. This is not a case where the appellant argues he relied on the application judge's initial order to fashion submissions that were entirely limited to quantum and that he was not given an opportunity to address broader questions relevant to costs. The appellant had that opportunity and, indeed, it would seem to us that his submissions addressed the questions of costs as broadly as did the submissions of the respondent.

[9] Apart from any question of procedural fairness, we see no basis upon which to interfere with the manner in which the trial judge ultimately exercised his discretion in his decision to refuse to order costs.

[10] The appeal is dismissed.

[11] Costs to the respondent on the appeal in the amount of $5,000, inclusive of disbursements and relevant taxes.

"Doherty J.A."

"E.A. Cronk J.A."

"P. Lauwers J.A."