Court of Appeal for Ontario

Citation: Fuller v. Aphria Inc., 2020 ONCA 465 Date: 2020-07-16 Docket: C67236

Tulloch, van Rensburg and Zarnett JJ.A.

Between

Jon-Paul Fuller and JPF Komon Kaisha Inc. Applicants (Appellants)

and

Aphria Inc. and Pure Natures Wellness Inc. d/b/a Aphria Respondents (Respondents)

Counsel: Earl A. Cherniak, Q.C., Jason M. Squire and Lindsay A. Woods, for the appellants Eric S. Block, Jacqueline Cole and Patrick Healy, for the respondents

Heard: February 6, 2020

On appeal from the order of Justice Laurence A. Pattillo of the Superior Court of Justice, dated June 21, 2019, with reasons reported at 2019 ONSC 3778, 147 O.R. (3d) 106.

COSTS ENDORSEMENT

[1] By a decision dated June 23, 2020, we allowed the appeal in part, awarded costs of the appeal to the appellants, and invited written submissions on costs of the proceedings in the Superior Court: 2020 ONCA 403. We have now received those submissions.

[2] The appellants request costs in their favour on a partial indemnity basis in the sum of $91,358.38 for fees and disbursements. The respondents agree that the appellants should receive costs on a partial indemnity basis, but submit that they should be in the amount of $74,408.00.

[3] The single item that accounts for the difference in amount (roughly $16,950.00) is a disbursement to the appellants' expert who gave evidence on the issue of the quantum of damages. The respondents contest that disbursement on the basis that the expert's evidence was rejected by the application judge. When he assessed damages (an assessment that was not disturbed on appeal), the application judge referred to the work the expert had undertaken as a "mathematical exercise" rather than an expert opinion.

[4] The appellants say the disbursement should be allowed on two grounds. First, they submit that the expert's evidence contained information that was useful in the assessment of damages, even though the application judge did not accept the ultimate conclusion. Second, they say that to disallow the disbursement would be to engage in an exercise of distributive costs, which has been disapproved by this court.

[5] We disagree with the appellants that the disallowance of an element of a successful party's costs on the basis contended for in this case would amount to a distributive costs order. The latter involves an issue by issue review of the result of litigation, with the costs being determined by success on each issue rather than by reference to overall success in the litigation: Armak Chemicals Ltd. v. Canadian National Railway Co., 1991 CarswellOnt 440 (C.A.), at paras. 13, 19-20; Wesbell Networks Inc. v. Bell Canada, 2015 ONCA 33, at para. 21.

[6] There is no suggestion here that the appellants should not receive costs because of a lack of success on any issue. The appellants were ultimately successful on the issues of liability and damages (although not in the quantum they sought). The question here is different. It is whether the appellants should be reimbursed for a specific disbursement, that is, whether the disbursement goes beyond what should be properly recoverable by a successful party in a partial indemnity costs award.

[7] In determining whether and to what extent disbursements to an expert should be allowed, the court considers, among other things, whether the expert made a contribution to the case and whether the evidence was of marginal value or crucial to the case: Hamfler v. 1682787 Ontario Inc., 2011 ONSC 3331, at para. 17; R & G Draper Farms (Keswick) Ltd. v. Nature's Finest Produce Ltd., 2016 ONCA 626, 133 O.R. (3d) 395, at para. 20. We agree with the respondents that the disbursement to the expert should not be recoverable in this case. It is difficult to see any value contributed by the evidence of the expert. The evidence essentially consisted of the multiplication of publicly available share prices by the number of options the appellants held, and the subtraction, from the resulting total, of the exercise price. We agree with the description of that exercise as a mathematical one, not opinion evidence. To the extent the mathematics produced amounts based on the share prices at which the appellants claimed they would have disposed of the shares, they were premised on an assumption that was not proven to the satisfaction of the application judge and were thus not useful. To the extent the expert's evidence contained other calculations based on share prices on different dates, or raw material from which still other calculations could be done, again, that raw material was simply publicly available share price data and the calculations were simply mathematics; expert evidence was not required.

[8] Accordingly, we award costs of the application to the appellants in the sum of $74,408.00 for fees and disbursements. The appellants should also recover HST on the applicable amounts.

"M. Tulloch J.A."

"K. van Rensburg J.A."

"B. Zarnett J.A."