Court of Appeal for Ontario

Date: 2018-03-20 Docket: C63148

Judges: Cronk, Huscroft and Nordheimer JJ.A.

Between

Ronald Rutman Respondent/Plaintiff

and

Saul Rabinowitz, Moishe Bergman, Artcraft Company Inc., John Doe 4 and John Doe 5 Appellants/Defendants

Counsel

Helen A. Daley and Michael Finley, for the appellants Moishe Bergman and Artcraft Company Inc.

John J. Adair, for the appellant Saul Rabinowitz

Matthew P. Sammon and S. Jessica Roher, for the respondent

Heard

November 16, 2017

Appeal Information

On appeal from the judgment of Justice Michael A. Penny of the Superior Court of Justice (Commercial List), dated November 30, 2016, with reasons reported at 2016 ONSC 5864.

Costs Endorsement

[1] On January 31, 2018, this court released its decision dismissing the appeal, and awarding costs of the appeal to the respondent. We invited the parties to make submissions on the issue of the appropriate quantum of those costs. We have now received and reviewed those submissions.

[2] The respondent submits that he ought to receive his costs on a substantial indemnity basis given the nature of the underlying allegations and the findings made by the trial judge. He seeks those costs in the amount of $64,644.01. The appellants submit that there is no principled basis to award the costs of the appeal on a substantial indemnity basis. They contend that their impugned conduct has been sanctioned by the award of substantial indemnity costs at trial and the award of punitive damages. The appellants say that a reasonable amount for costs of the appeal on the partial indemnity scale is $30,000.

[3] We agree with the appellants. While the trial judge properly awarded substantial indemnity costs of the trial given the underlying conduct of the appellants, there is no principled basis to do so with respect to the appeal. Any party has a right of appeal and they ought not to be penalized for exercising that right unless there is something in the conduct of the appeal itself that warrants such a sanction. There is no such conduct in this case. While the appellants were unsuccessful in their appeal, they were entitled to have the trial judge's decision reviewed by this court and, in doing so, they raised legitimate issues.

[4] We therefore grant the respondent his costs of the appeal, fixed in the amount of $30,000, inclusive of disbursements and HST, payable by the appellants jointly and severally.

E.A. Cronk J.A.

Grant Huscroft J.A.

I.V.B. Nordheimer J.A.