COURT OF APPEAL FOR ONTARIO

CITATION: Barbour v. Bailey, 2016 ONCA 334

DATE: 20160504

DOCKET: C58076

MacFarland, Rouleau and Roberts JJ.A.

BETWEEN

The Estate of Gerald Harry Barbour

Objector/Respondent

(Appellant)

and

Angelina Bailey

Possessory Claimant/Applicant

(Respondent)

Jeffrey E. Streisfield, for the appellant

Izaak de Rijcke and Robert Fenn, for the respondent

Heard: June 16, 2015

On appeal from the judgment of Justice Susan Healey of the Superior Court of Justice dated November 29, 2013, with reasons reported at 2013 ONSC 7397, 39 R.P.R. (5th) 36, and from the costs orders dated April 14 and June 18, 2014, with reasons reported at 2014 ONSC 2343 and 2014 ONSC 3698.

COSTS ENDORSEMENT

[1] This endorsement disposes of the costs related to the appeal and related proceedings. Those costs include the costs granted in the first and second trials of this matter, including the costs hearing involving the appellant’s counsel, and the appeal from the second trial judgment.

[2] The appellant passed away on July 26, 2015. An order to continue the proceedings was granted to the appellant by Roberts J.A. of this court on March 15, 2016.

[3] The appellant claims overall success in these proceedings and seeks partial indemnity costs of the first and second trials, the related proceedings, and of this appeal, in the all-inclusive amount of $410,000.00, broken down essentially as follows:

(i) the first trial that ended in the appellant’s favour: $275,000.00;

(ii) the second trial that ended in the respondent’s favour but was substantially overturned on appeal: $111,000.00;

(iii) the appeal to this Court from the second trial judgment that substantially ended in the appellant’s favour: $25,000.00.

[4] The appellant is not seeking to overturn this court’s cost award of $25,000.00 dated May 16, 2012 that was granted to the respondent on her successful appeal of the first trial judgment. The appellant submits that this cost award in favour of the respondent should be set off against any costs awarded to the appellant.

[5] The respondent argues that the appellant is not entitled to any costs and that she should be awarded her costs. In particular, the respondent argues that she was entirely successful before the second trial judge, and that the appellant was only partially successful on appeal. Further, her right to a prescriptive easement remains unchanged and exceeds her numerous offers to settle. In the alternative, the respondent argues that there ought to be an order for no costs to either party and that the parties should absorb their own costs in all proceedings.

[6] We would not give effect to the respondent’s submissions.

[7] The main focus of both trials was the respondent’s claim for adverse possession over the entirety of Part 2 of the appellant’s property. That claim took up the majority of the evidence and occupied most of the trial time. Starting from the initial response to the appellant’s request that she pay a yearly licence fee to use a right of way over his property, the respondent maintained the erroneous belief that she owned the entirety of Part 2. Indeed, the respondent thought that it was she and not the appellant who had the sole right to grant licences over Part 2, notwithstanding the lack of merit of her claim for adverse possession. The majority of the respondent’s offers to settle were premised on the respondent granting to the appellant an easement over his own land.

[8] The question of the respondent’s right to an easement over Part 2 of the appellant’s property was dealt with as a distant alternative remedy at the trials and in the judgments. While the appellant did not entirely prevail with respect to that issue because he opposed the grant of any easement right, the respondent’s right to an easement was markedly reduced by this court’s judgment from unrestricted access by any means over the entirety of Part 2 of the appellant’s property to pedestrian access over a particular track. As a result, on appeal, the appellant achieved greater success on that issue than the respondent.

[9] It is well established that the overarching principles to be applied in dealing with the costs of any proceeding are reasonableness, fairness and proportionality.

[10] Certainly, a large cost award as claimed by the parties is not unreasonable, unfair or disproportionate in light of the following factors: the first trial lasted 19 days and the second trial took 13 days; there were numerous pre-trial motions and other proceedings; complicated and technical expert evidence was presented by both sides; and there were a myriad of difficult legal issues fiercely argued by the parties before both judges.

[11] Further, there is no issue that the outcome of these proceedings was exceedingly important to the parties, so important, that the issue of ownership over Part 2 of the appellant’s property has lasted over twenty years and survived the appellant who sadly passed away only about a month after this appeal was argued.

[12] In our view, however, the respondent’s actions in these proceedings were neither proportionate nor reasonable. While the amount of costs claimed is understandable in the circumstances of this case, it is truly regrettable that the proceedings carried on to this point. Having the benefit of the entire record, we agree with the submission of the appellant that the outcome of this appeal for the respondent was not significantly better than the appellant’s 1995 offer of a yearly licence fee and that, had the respondent accepted that or a similar offer, all of these proceedings could have been avoided. In the face of the correspondence from the appellant’s lawyers, the respondent never questioned but stubbornly maintained the erroneous position that she owned the entirety of Part 2.

[13] Even after the Director of Titles confirmed the appellant’s boundaries, which exposed the respondent’s erroneous views, the respondent nevertheless pressed on with an adverse possession claim that proved on appeal to be without merit. Had the respondent obtained a survey at the time that she bought her island property, as she was advised to do, it would have been clear to her that the property she was acquiring did not include Part 2. Up until the hearing of this appeal, the appellant continued to offer pedestrian access across his property to the respondent, which was refused because the respondent maintained her erroneous belief that she owned all of Part 2.

[14] The costs of the first trial were ordered by this court to be “in the cause”. It will be recalled that the first judgment was overturned in this court as the result of a reasonable apprehension of bias going to the fairness of that trial and not on the merits. The appellant has been largely successful in the result and is entitled to his costs throughout.

[15] That being said, we find the costs claimed by the appellant for the two trials to be too high. Specifically, in considering the appropriate quantum of costs to be awarded, we see no reason to depart from McIsaac J.’s November 8, 2011 assessment in relation to the first trial in the amount of $170,873.85 ($151,215.80 plus HST of $19,658.05), because the trial judge was in the best position to determine those costs.

[16] As a result, we are of the view that the amount of $282,000.00, inclusive of all amounts, as costs for the two trials, is fair, proportionate and reasonable in the circumstances of this case.

[17] The appellant is also entitled to his costs of this appeal which we fix in the amount of $25,000.00, the sum to which the parties agreed. In accordance with his request, we would set off that amount against the May 16, 2012 costs order of this court of $25,000.00 payable to the respondent. As a result, the parties owe each other no costs with respect to these appeals.

[18] The $282,000.00 costs award to the appellant should be paid by the respondent within thirty days of the release of this endorsement.

“J. MacFarland J.A.”

“Paul Rouleau J.A.”

“L.B. Roberts J.A.”