Court of Appeal for Ontario

Date: 2018-03-06 Docket: C62744

Justices: Sharpe, Blair and Epstein JJ.A.

Between

Raibex Canada Ltd., Ashraf Habashy, Ihab Lawandi and Ramy Bastaros Plaintiffs/Defendants by counterclaim (Respondents/Appellants by way of cross-appeal)

and

ASWR Franchising Corp., ASWR Developments Inc., Hellenic International Holdings Inc., Leontian Holdings Inc., Athanasios Anastopoulos aka Tom Anastopoulos and J. Perry Maisonneuve Defendants (Appellants/Respondents by way of cross-appeal)

*Plaintiffs by counterclaim

Counsel

Geoffrey B. Shaw and Christopher Horkins, for the appellants

David S. Altshuller and Lara Di Genova, for the respondents

Heard: October 4, 2017

On appeal from: the judgment of Justice Wendy M. Matheson of the Superior Court of Justice, dated September 7, 2016, with reasons reported at 2016 ONSC 5575.

Costs Endorsement

[1] The central issue on this appeal was whether the franchise disclosure document the appellant franchisor (respondent by cross-appeal) provided was so inadequate that it entitled the respondent franchisee (appellant by cross-appeal) to rescind the parties' franchise agreement under s. 6(2) of the Arthur Wishart Act (Franchise Disclosure), 2000, S.O. 2000, c. 3.

[2] The franchisee sought a declaration validating the rescission of the franchise agreement and related agreements. It also claimed several million dollars in consequential damages. The franchisor sought repayment of costs incurred after taking over the franchise following receipt of the franchisee's notice of rescission.

[3] Both sides brought a motion for summary judgment. The motion judge held that the franchise agreement had been validly rescinded but dismissed the franchisee's damage claim. The motion judge dismissed the franchisor's claim for damages. The motion judge determined that no costs should be awarded.

[4] The franchisor appealed the motion judge's decision declaring that the franchise agreement had been rescinded and the dismissal of its cross-motion for damages. The franchisee cross-appealed certain ancillary issues addressed in the motion judge's reasons.

[5] In a decision released January 25, 2018, we found in favour of the franchisor on all issues.

[6] At the end of the hearing the parties agreed that the franchisee should pay the costs of the appeal and cross-appeal in the amount of $40,000, inclusive of disbursements and taxes. The parties were not able to agree on the costs of the underlying motions for summary judgment and we have now received their written submissions.

[7] The franchisee submits that this court ought not to interfere with the motion judge's decision on costs. Alternatively, the franchisee argues that the appropriate measure of partial indemnity costs incurred by the franchisor is $19,692.00.

[8] The franchisor's position is that in the light of the result, the franchisee should be ordered to pay the costs of the motions in the amount of $114,676.40.

[9] Having considered the parties' submissions, and the factors enumerated in r. 57 of the Rules of Civil Procedure, we are of the view that a reasonable award to the franchisor for the costs of the motion and cross-motion is $60,000, inclusive of disbursements and taxes in addition to costs of the appeal fixed at $40,000, inclusive of disbursements and taxes and we so order.

"Robert J. Sharpe J.A."

"Gloria Epstein J.A."

[1] Blair J.A. took no part in this costs endorsement.