Court of Appeal for Ontario

Citation: Le Treport Wedding & Convention Centre Ltd. v. Co-operators General Insurance Company, 2020 ONCA 556

Date: 2020-09-03

Docket: C67088

Before: Feldman, Lauwers and Huscroft JJ.A.

Between

Le Treport Wedding & Convention Centre Ltd.

Plaintiff (Appellant)

and

Co-operators General Insurance Company

Defendant (Respondent)

Counsel: Emily Stock and Brandon Cook, for the appellant Robert W. Dowhan and Matthew J. McMahon, for the respondent

Heard: in writing

On appeal from the judgment of Justice Douglas K. Gray of the Superior Court of Justice, dated May 17, 2019, with reasons reported at 2019 ONSC 3041 and from the costs order, dated June 18, 2019, with reasons at 2019 ONSC 3779.

COSTS ENDORSEMENT

[1] We allowed the appeal in part and granted judgment to Le Treport Wedding & Convention Centre Ltd. in the amount of $429,329.18, with costs and disbursements on the appeal, for the reasons reported at 2020 ONCA 487. We invited the parties to make written submissions on the trial costs if they were unable to agree.

[2] Both parties had trial bills of costs in the amount of about $100,000 apart from the appellant’s additional costs for its business loss expert.

[3] In his costs endorsement of June 18, 2019, the trial judge awarded the respondent, Co-operators General Insurance Company, costs on a partial indemnity basis, but reduced the total award to $75,000 to account for Co-operators’ unreasonable delay in paying out the balance it owed to the appellant under a Sewer Back Up Endorsement included in the “all-risks” policy at issue in this case.

[4] In light of its success on appeal, Le Treport requests its trial costs in the amount of $100,000 all-inclusive. While the trial judge did not expressly state the amount of the discount he applied to Co-operators’ costs, counsel for Le Treport infers, and we agree, that it was in the range of $25,000. In Le Treport’s submission, this $25,000 discount should be added back to the total figure to be awarded.

[5] Le Treport also notes that it made an offer to settle the action for $900,000 on March 8, 2017. It argues that its combined award of $813,313.87, comprised of judgment damages and the late Sewer Back Up payment, is “likely” greater than the settlement offer if costs and interest are taken into account.

[6] For its part, Co-operators requests 100 percent of its costs at trial or, in the alternative, a 25 percent reduction to the costs awarded by the trial judge in recognition of the appellant’s success on one out of the four issues on appeal. Counsel for Co-operators argues that the appellant aggressively pursued claims for extracontractual damages, bad faith, and punitive damages, refusing to narrow the issues for trial. Co-operators also notes that the appellant was ultimately awarded less than one fifth of the total amount claimed in the action.

[7] With respect to the March 8 settlement offer, counsel for Co-operators states that Le Treport was only awarded damages of $429,329.18, or approximately half of its offer to settle. Despite Co-operators very late payment of the Sewer Back Up indemnity, Co-operators asserts that its amount should not be counted for the purposes of any analysis under r. 49 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. Counsel for Co-operators also argues that the March 8 settlement offer was made before Le Treport issued its Fresh as Amended Statement of Claim on May 5, 2017, which significantly increased the scope of the action and the damages sought.

[8] We agree with the appellant that costs should follow the event. In this case, Le Treport was required to initiate proceedings in order to recover funds to which it was entitled under the policy. Le Treport succeeded on appeal and should have succeeded at trial. It should have its trial costs.

[9] While Le Treport’s success was limited to one out of four issues on appeal, this is not a case of mixed success as between, for example, a claimant and cross-claimant. It is not appropriate to award trial costs in proportion to the number of issues on which the appellant succeeded or failed on appeal.

[10] In coming to this conclusion, we do not apply r. 49. The trial judge does not appear to have considered the consequences of the settlement offer and it is not clear whether the issue was before him. In any event, r. 49 is of limited usefulness at this stage. As noted, both parties claimed trial costs in the amount of about $100,000. There is no basis for discounting the award of costs to the appellant.

[11] For these reasons, we set aside the costs order of the trial judge and fix costs in favour of the appellant at $100,000 all-inclusive payable forthwith.

“K. Feldman J.A.”

“P. Lauwers J.A.”

“Grant Huscroft J.A.”