OZ Merchandising Inc. v. Canadian Professional Soccer League Inc., 2021 ONCA 520

COURT OF APPEAL FOR ONTARIO DATE: 20210719 DOCKET: C67488

Doherty, Benotto and Huscroft JJ.A.

BETWEEN

OZ Merchandising Inc. Plaintiff (Appellant)

and

Canadian Professional Soccer League Inc., Eastern Ontario District Soccer Association, The Ontario Soccer Association, Canadian Soccer Association, Canadian Soccer League Inc., CSL Association Inc., IRA Greenspoon, Vincent Ursini, Cary Kaplan and Stan Adamson Defendants (Respondents)

Counsel: Nicholas Karnis and Rajiv Prasad, for the appellant Jordan Goldblatt and Jocelyn Howell, for the respondents, Eastern Ontario District Soccer Association, The Ontario Soccer Association Andrew K. Lee, for the respondent, Canadian Soccer Association

Heard: June 23, 2021 by video conference

On appeal from the judgment of Justice Robyn M. Ryan Bell of the Superior Court of Justice, dated August 27, 2019, reported at 2019 ONSC 5017; costs decision reported at 2020 ONSC 119.

By the Court:

Overview

[1] The appellant, OZ Merchandising Inc. (“OZ Merchandising”) appeals from the dismissal of its action against the respondents, Eastern Ontario District Soccer Association (“EODSA”), the Ontario Soccer Association (“OSA”), and the Canadian Soccer Association (“CSA”). In the event that the main appeal fails, OZ Merchandising seeks leave to appeal the costs order made by the trial judge.

[2] The court did not call on the respondents to address any of the submissions made by the appellant on its appeal from the dismissal of the action. The court dismissed that appeal with reasons to follow. After hearing argument on the costs appeal, the court reserved judgment. We have concluded leave to appeal from that order should be granted but the appeal should be dismissed. These reasons address both our dismissal of the main appeal, and the dismissal of the costs appeal.

The Main Appeal

[3] This lawsuit began in 2004. There is no need to chronicle its lengthy procedural history. The trial judge provided a brief summary in her Costs Decision, at para. 8. By the time the action reached trial in 2019, there was only one plaintiff, the appellant OZ Merchandising, and three defendants, the respondents, before the court.

[4] The trial proceeded before a jury for about seven weeks. However, the trial judge struck the jury as a consequence of what she determined to be numerous serious improprieties in counsel for the appellant’s closing argument to the jury: OZ Merchandising Inc. v. Canadian Professional Soccer League Inc., 2019 ONSC 3882. There is no appeal from the decision striking the jury. [1]

[5] The appellant’s claims against the respondents arose out of three discrete events. We need not review the evidence in detail. The factual context for the claims is succinctly described by the trial judge in the first paragraph of her reasons:

The Ottawa Wizards were a soccer club in the Canadian Professional Soccer League (“CPSL”) from 2001 to 2003. Their home stadium was the OZ Optics Stadium in Carp, Ontario. In the fall 2003, three events occurred. First, in September, the Ottawa Wizards applied to the Ontario Soccer Association (“OSA”) to host the OZ Optics Invitational Tournament; the application was not approved, and the proposed tournament was not held. Second, in November, the Canadian Soccer Association (“CSA”) issued International Transfer Certificates (“ITCs”) for two Ottawa Wizards players, Peter Mponda and Macdonald Yobe, which resulted in Mr. Mponda and Mr. Yobe returning to Malawi. Third, in December, the Eastern Ontario District Soccer Association (“EODSA”) publicized that OZ Dome Sports Club had not applied to operate an indoor league during the 2003-2004 season and described the potential consequences of participating in “unsanctioned competition” at the OZ Dome facilities.

[6] OZ Merchandising claimed against each respondent, alleging negligence and intentional interference with the economic interests of OZ Merchandising (referred to by the trial judge as the “unlawful means” claim).

[7] The trial judge dismissed the negligence claims as against each respondent. In respect of each of the three events giving rise to the negligence claims, the trial judge found:

• OZ Merchandising failed to show any of the respondents owed it a duty of care;
• if a duty of care existed, there was no basis upon which to find any of the respondents breached that duty of care; and
• if a duty of care existed, and if there was a breach of that duty of care, OZ Merchandising had failed to prove any damages: Reasons, at paras. 9-11.

[8] In respect of the intentional interference with economic interest claim, the trial judge concluded:

• there was no evidence any of the respondents intended to cause economic harm to OZ Merchandising;
• there was no evidence any of the respondents committed an unlawful act against a third party; and
• OZ Merchandising failed to prove any damages: Reasons, at paras. 10-11.

[9] In summary, the trial judge concluded OZ Merchandising had failed to establish any of the essential elements necessary to prove either of the claims it advanced against the respondents. To the extent the appeal turns on alleged errors made by the trial judge in her analysis of the claims, the appellant can succeed only if it demonstrates errors in respect of all three elements of the negligence claim, or all three elements of the “unlawful means” claim.

The Scope of the Appeal

[10] It is unfortunately necessary to comment on the manner in which this appeal has been perfected and presented. The Notice of Appeal and Amended Notice of Appeal list dozens of grounds of appeal. The appellant’s factum on the appeal addresses several, but far from all of the grounds of appeal referred to in the Notice of Appeal and Amended Notice of Appeal. In oral argument, counsel addressed some, but not all of the grounds argued in the factum.

[11] The appellant also brought what it styled as a “fresh evidence” application. On the application, the appellant filed a three-volume motion record and a factum. The motion record contained two affidavits, one from a paralegal who worked for the appellant and had some involvement in the trial, and the other from Mr. Omur Sezerman, the President of the appellant, a former plaintiff and the person directing the litigation on behalf of the appellant.

[12] A review of the affidavits, the attachments to the affidavits, and the factum, reveals that the vast majority of the supposed “fresh evidence” is, in reality, argument based on the trial record. The material advances arguments, almost all of which were made at trial, often more than once, and rejected by the trial judge.

[13] The appellant sought leave to file a factum of some 500 pages. On the motion, the appellant indicated its factum could be reduced to about 125 pages. Leave to file a factum of that length was denied. A further appeal to a panel was dismissed. We agree with counsel for the respondents’ submission that the “fresh evidence” material presently before the court is a transparent attempt to avoid both the 30-page limit on facta prescribed by a Practice Direction of this court, and the orders of this court refusing leave to file an extended factum: OZ Merchandising Inc. v. Canadian Professional Soccer League Inc., 2020 ONCA 532, aff’d. 2020 ONCA 659.

[14] In the circumstances, it would be appropriate to refuse to address the grounds of appeal arising from the trial record but disguised by the appellant as part of a “fresh evidence” application. We will, however, address the merits of two of those arguments. One alleges bias by the trial judge, and the other alleges ineffective assistance by trial counsel. We will address these issues because they affect matters relevant to the proper administration of justice. The appellant’s disregard of the rules and orders of this court can be addressed in the context of our determination of the costs of the appeal.

[15] Apart from the bias and ineffective assistance of counsel claims, we have considered the grounds of appeal raised and argued by the appellant in its factum and, or in its oral argument.

The Grounds of Appeal

[16] The grounds of appeal can be broken down into four categories:

• alleged errors of fact and law in respect of the negligence claim [2];
• allegations of evidentiary and procedural errors that rendered the trial unfair;
• the ineffective assistance of counsel allegation; and
• the bias allegation.

(a) The errors relating to the negligence claim

[17] The appellant makes various submissions in its factum pertaining to the trial judge’s analysis of, and findings in respect of the negligence claim. Some of those arguments were repeated in oral submissions.

[18] The appellant challenges some, but not all, of the grounds upon which the trial judge found the appellant had failed to prove damages. Even if the appellant’s arguments relating to damages were accepted, the trial judge’s finding the appellant suffered no damages would still stand, based on unchallenged findings at trial. Without proof of damages, the negligence claims cannot succeed. Consequently, even if the appellant demonstrated the trial judge erred in holding the respondents did not owe a duty of care to the appellant, and further erred in holding there was no breach of that duty of care, the negligence claim would still fail.

[19] The absence of any challenge on appeal to some of the grounds on which the trial judge found the appellant failed to prove damages, is enough to dispose of the arguments premised on alleged errors in the negligence analysis. We will, however, address those arguments. They repeat those made at trial. With one exception, the appellant’s arguments on appeal ignore the trial judge’s factual findings and her detailed analysis of the applicable case law.

[20] The appellant does contend the trial judge made a palpable and overriding factual error in her duty of care analysis. The appellant argues the trial judge wrongly concluded the appellant had failed to prove it owned the Ottawa Wizards Soccer Club. Ownership of the soccer club was relevant to, but not necessarily determinative of, whether any of the respondents owed a duty of care to the appellant in respect of the issuance of the International Transfer Certificates for the two Ottawa Wizards players.

[21] The trial judge’s finding, that the appellant had not shown it was the owner of the Ottawa Wizards, rested to some extent on evidence of an application made by the Ottawa Wizards for membership in the Canadian Professional Soccer League: Reasons, at para. 28. That application showed OZ Optics as the owner. The appellant argues the trial judge put too much emphasis on that document, especially because the application was made some three years before the relevant events. There was no evidence of any subsequent change in ownership.

[22] We see no error in the trial judge’s fact finding. She considered the evidence and the arguments relating to the ownership of the Wizards. While the trial judge did place emphasis on the application in 2000 for membership in the Canadian Professional Soccer League, it was not the only evidence she relied on. It was for the trial judge to determine the weight to be assigned to any particular piece of evidence: Reasons, at paras. 24-39.

[23] It must also be borne in mind that the ultimate question was not the ownership of the Ottawa Wizards. The question was whether the necessary relationship existed between the appellant and any of the respondents in respect of the International Transfer Certificates to warrant finding a duty of care. As the trial judge correctly observed, the evidence relevant to whether a duty of care existed went beyond the evidence concerning the ownership of the Ottawa Wizards.

[24] The appellant has not demonstrated a basis upon which this court should interfere with the trial judge’s finding of fact on the ownership question.

[25] In a variation on the argument about ownership, counsel for the appellant submitted the trial judge wrongly focused exclusively on the legal relationship between the appellant and the Ottawa Wizards. He maintained that the trial judge had to look at their “relationship in the soccer world”.

[26] We do not accept the trial judge limited her consideration to the purely legal relationships between the appellant and the respondents. She fully appreciated that the duty of care analysis required an evaluation of the nature of the relationship, if any, between the appellant and the respondents considered in the context of the three events said to give rise to the negligence claim: Reasons, paras. 16-19.

(b) Evidentiary and Procedural Rulings

(i) Did the trial judge err in holding that any motion for judgment against the defaulting defendants would be decided by a judge and not the jury?

[27] The trial judge held that any motion for default judgment against the defaulting defendants would proceed before a judge and not the jury. She relied on the express language in Rule 19.05(1) of the Rules of Civil Procedure. The trial judge also accepted that any admissions deemed to be made by the defaulting defendants as a consequence of their default would not be admissible against the respondents. The appellant conceded both points before the trial judge. They now argue to the contrary.

[28] Setting aside the appellant’s retreat from the position it took at trial, we are satisfied the trial judge’s rulings accord with the applicable procedural and evidentiary rules. The language of Rule 19.05(1) expressly contemplates a plaintiff moving for judgment against a defaulting defendant “before a judge”. The Rule also provides that the judge may “order that the action proceed to trial”. These rules give a judge the discretion to hear a motion for judgment, and a discretion to order the matter to trial. Neither entitles a plaintiff to put the motion before a jury. The discretion as to how, and in what forum, the matter will proceed is left to the judge.

[29] The trial judge’s ruling that the deemed admissions by the other defendants would not be admissible against the respondents also rests on solid ground. An admission made by one party in a judicial proceeding is not admissible against other parties to that judicial proceeding: Correia v. Canac Kitchens, 2008 ONCA 506, at para. 110; R. v. C.(P.), 2015 ONCA 30, at paras. 39-45.

[30] The trial judge’s rulings also reflect a proper exercise of her case management responsibilities. Allowing the appellant to lead evidence before a jury of deemed admissions, which were not admissible against the respondents, and which in some cases, did not relate to the claims against the respondents, ran the risk of prejudicing the respondents in their defence despite any limiting instruction the trial judge might give.

[31] The rulings did not prejudice the appellant in the presentation of its case. As the trial judge made clear, the appellant was not foreclosed from leading evidence from anyone, including the parties noted in default, if that evidence was relevant to the claims advanced by the appellant against the respondents.

[32] The appellant submits the trial judge bifurcated the trial contrary to the provision in Rule 6.1.01 of the Rules of Civil Procedure. There was no bifurcation of the trial. The trial judge correctly held the default proceedings were a separate proceeding from the trial. The trial judge’s holding, that evidence not relevant to the claims as pleaded against the respondents would not be heard by the jury, was not a bifurcation of the issues properly before the jury, but an application of the universal rule limiting admissibility to evidence relevant to the issues to be decided by the jury.

(ii) Did the Trial Judge Improperly Limit the Scope of the Appellant’s Claim at the Outset of the Trial?

[33] The appellant made repeated attempts to advance a theory of liability based on the respondents’ alleged legal responsibility for the acts of other defendants. The pleadings provided no basis for any such theory. A motion to amend the pleadings shortly prior trial to incorporate that theory failed: OZ Merchandising Inc. v. Canadian Professional Soccer League, 2018 ONSC 7468. Appeals from that ruling to the Divisional Court, Court of Appeal and Supreme Court of Canada, all failed. A further attempt to amend the pleadings at trial also failed: Ruling on Motion for Reconsideration, May 10, 2019, at paras. 17-35.

[34] Despite the failed attempts to amend the pleadings prior to trial, the appellant continued to press a theory predicated on the respondents’ liability for the acts of other defendants. At the outset of the trial, counsel for the appellant provided the court with draft jury questions. One question read:

Are the defendants [the respondents] liable for the damages sustained by the plaintiff as a result of the actions of the CPSL/CSL/CSLA?

[35] By its terms, the question assumed that the jury was entitled to find the respondents liable to the appellant for the actions of other entities. The proposed question ignored the scope of the pleadings and the orders refusing to permit the appellant to amend those pleadings.

[36] In submissions at trial, counsel described the appellant’s theory as a “single entity or system” theory of liability. Counsel argued this theory was somehow different than a theory of liability based on agency or some other form of vicarious liability. The trial judge, in rejecting the appellant’s claim that it could argue the respondents were responsible for the actions of others, described the theory advanced by the appellant as the equivalent of the discredited concept of “group enterprise” liability: Ruling on Evidentiary Issues and Scope of Trial, April 16, 2019, at paras. 12-18.

[37] The appellant argues the claim was not predicated on a group enterprise theory, but instead relied on the assertion that the respondents and other defendants were engaged in a joint system of governance over soccer operations within Canada. The appellant maintains that this joint governance rendered each respondent liable for the acts of other defendants who were also part of the overall scheme controlling soccer operations in Canada.

[38] Whatever name one chooses to affix to the appellant’s theory of the respondents’ liability for the actions of other defendants, it amounts to a claim that the respondents were vicariously liable through agency principles for the actions of others. The appellant advanced no such theory through the first 14 years of the lawsuit. The appellant’s attempt to introduce that theory was rejected in 2018 as coming far too late in the litigation.

[39] The trial judge correctly rejected the appellant’s numerous attempts to expand the scope of the trial beyond the boundaries of the pleadings.

(iii) The Admissibility of Documentation Pertaining to FIFA Rules

[40] FIFA is an international organization that sets down rules and procedure governing the conduct of various national soccer associations. The documentation setting out FIFA rules and regulations was admitted at trial on consent.

[41] The appellant argued it was entitled to refer to the contents of the FIFA rules in support of its negligence claim, especially as it related to the transfer of the contracts of the two Ottawa Wizards players. The appellant maintains that as the rules were admitted on consent, they were admitted “for the truth of their contents”.

[42] We agree with the respondents that the issue was not the admissibility of the FIFA rules. They were properly before the court on agreement. The trial judge concluded, however, that she had no evidence as to how, if at all, the rules applied in the specific circumstances of the two Ottawa Wizards players. Absent evidence, the trial judge was not prepared to accept, as valid, the appellant’s interpretation of the relevant rules: Reasons, para. 76. In the absence of evidence, the trial judge made no error in refusing to act on the appellant’s submissions as to the meaning of the rules.

(c) The Ineffective Assistance of Counsel

[43] The appellant argues that trial counsel, who is also apparently an employee of the appellant or a related company, provided ineffective assistance at trial. The appellant submits the incompetence of its lawyer should be visited on the respondents, and the judgment obtained by the respondents dismissing the action should be set aside because the appellant had incompetent counsel. Remarkably, the appellant makes the submission although counsel, who the appellant says was incompetent at trial, appears as co-counsel for the appellant on the appeal. [3]

[44] Allegations of ineffective legal assistance at trial in civil matters are properly raised by way of a negligence action brought by the client against the lawyer. There may be some civil cases in which the nature of the claim gives rise to a public interest that transcends the private interests of the litigants and requires that an appellant be permitted to raise the competence of its trial counsel as a ground for setting aside the trial judgment. The claim advanced by the appellant against the respondents is a straightforward negligence claim seeking damages for pure economic loss. Nothing in the nature of this case justifies permitting the appellant to rely on the incompetence of counsel as a basis for denying the respondents the judgment obtained at trial: see D.W. v. White, at paras. 42-51, 55.

[45] Even if the appellant could advance the incompetence of its counsel as a reason to set aside the judgment below, there is no merit to the ineffective assistance claim advanced by the appellant. The only evidence in support of the claim comes from Mr. Sezerman’s affidavit [4]. Although one section of Mr. Sezerman’s affidavit is headed “Ineffective Assistance of Counsel”, many of the complaints in that section are directed primarily at the trial judge. As with most of the rest of Mr. Sezerman’s affidavit, these paragraphs reiterate arguments made and lost, often more than once, at trial. Mr. Sezerman’s recollection and characterization of the events at trial do not constitute “fresh evidence” on appeal and are inadmissible.

[46] Many of the allegations of ineffective assistance made by Mr. Sezerman come in the form of bald statements with no reference to the actual trial record. Other allegations appear to criticize trial counsel for abiding by the trial judge’s rulings, rather than following Mr. Sezerman’s instructions to the contrary. Abiding by a trial judge’s rulings, even when the client is convinced they are wrong, is hardly ineffective assistance.

[47] Most importantly, although Mr. Sezerman asserts that his lawyer’s conduct “fell below the standard of reasonable professional judgment”, Mr. Sezerman offers no admissible evidence in support of that opinion. Mr. Sezerman is not a lawyer and is not qualified to opine as to whether counsel’s conduct fell below the accepted standard. Mr. Sezerman’s opinion is inadmissible.

[48] Finally, even if Mr. Sezerman were competent to offer an opinion on the reasonableness of trial counsel’s conduct, his opinion is wrong. For example, Mr. Sezerman repeatedly argues trial counsel was negligent in making certain admissions on the pre-trial motion concerning the default judgment proceedings and the scope of the trial. The admissions made by counsel were reasonable and consistent with the applicable procedural and evidentiary law. The trial judge would inevitably have ruled as she did regardless of what admissions may or may not have been made by counsel. As explained above, we are satisfied the trial judge’s rulings were correct.

[49] In summary, none of the portions of Mr. Sezerman’s affidavit referring to the competence of trial counsel meet the criteria for the admissibility of fresh evidence. Mr. Sezerman is not qualified to give an opinion as to the competence of counsel and that opinion is inadmissible. The opinion is also unsubstantiated by the trial record. If the appellant actually believes trial counsel, who remains counsel on appeal and apparently an employee, was negligent, the appellant can sue trial counsel. There is no justification for dragging the respondents into that controversy or denying them their judgment dismissing the appellant’s action.

(d) The Bias Allegation

[50] On April 23, 2019, the appellant brought a motion asking the trial judge to recuse herself after the trial judge made pre-trial rulings on various issues, including the scope of the trial. The appellant claimed the errors in the trial judge’s ruling, and her demeanour in the course of the proceeding, created a reasonable apprehension of bias against the appellant. The trial judge dismissed the motion and gave oral reasons (Trial Transcript, April 23, 2019, pp. 1-10).

[51] On May 6, 2019, the appellant brought a motion for a mistrial. This time, the appellant alleged actual bias and a reasonable apprehension of bias. Counsel relied on the same grounds advanced on the motion for recusal. The trial judge dismissed the motion (Endorsement, May 7, 2019).

[52] In both motions, the appellant’s allegations of bias, or a reasonable apprehension of bias, relied largely on rulings the trial judge made in the course of the trial. The appellant argued the rulings made against the appellant were so numerous and so wrong as to demonstrate a reasonable apprehension of bias, if not actual bias.

[53] The appellant chose not to renew any of the bias allegations in the factum filed on the appeal. Instead, the appellant included these allegations in the “fresh evidence” material.

[54] The affidavit of Ms. Elizabeth Ramirez, a paralegal involved in the trial, speaks to various rulings made at the trial, and the unfairness she believes flowed from those rulings. Ms. Ramirez’s opinion about the correctness or fairness of the rulings is irrelevant. The factual content of her affidavit adds nothing to the trial record. Her affidavit is not admissible as “fresh evidence” on the appeal.

[55] Mr. Sezerman’s affidavit refers at length to the bias claim. In large measure, Mr. Sezerman’s affidavit is simply argument, and repeats the arguments made many times at trial. The bias arguments based on the rulings made at trial stand or fall on the trial record. Mr. Sezerman’s opinions about the legal correctness of those rulings, and his characterization of the unfairness of those rulings, do not constitute fresh evidence on appeal and are not admissible.

[56] Although most of Mr. Sezerman’s affidavit consists of his version of the trial events and his opinion about the correctness of the rulings, neither of which constitute “fresh evidence”, Mr. Sezerman does make allegations which go beyond challenging the correctness of the trial judge’s rulings. Mr. Sezerman alleges institutional bias against him by the local judiciary in Ottawa. Mr. Sezerman also insinuates, but does not specifically allege, bias against him because of his ethnic background. We are prepared to treat the contents of Mr. Sezerman’s affidavit, which address those two allegations, as “fresh evidence”, which is properly before this court.

[57] We divide the bias allegations into three categories:

• Bias based on the conduct of the trial judge;
• Bias based on an institutional bias against Mr. Sezerman among the local judiciary; and
• Bias based on ethnic background.

(i) The Conduct of the Trial Judge

[58] The appellant’s arguments based on the trial judge’s conduct, both at trial and in his affidavit, come down largely to the assertion that the trial judge made so many errors, which had such a negative impact on the appellant’s case, that the trial judge must have been biased against the appellant.

[59] The submission rests on two false premises. First, adverse rulings, even rulings which are subsequently held to be wrong by a higher court, do not demonstrate bias. Second, the appellant has failed to demonstrate any substantive error in the rulings, or any unfairness in the process followed by the trial judge in rendering her rulings.

[60] Perhaps the best example of the misconceived nature of the bias allegations can be found in the appellant’s repeated insistence that the trial judge’s pre-trial ruling as to the scope of the trial effectively “gutted” the appellant’s case. The appellant alleges the ruling demonstrates bias, both because it was erroneous and because of its disastrous impact on the appellant’s case. In fact, the trial judge’s ruling did no more than limit the appellant to the case as pleaded, a limitation which applies to all litigants. As explained in our earlier reasons, she made no legal error in doing so, and regardless of what Mr. Sezerman may believe, her ruling imposed no procedural unfairness on the appellant.

[61] Put bluntly, Mr. Sezerman refuses to accept either the correctness of the trial judge’s rulings, or that they were made in good faith. Mr. Sezerman will believe what he chooses to believe. However, he has failed to show any error in the rulings and has failed to rebut the strong presumption in favour of judicial impartiality.

[62] The appellant’s submission that the trial judge’s ruling striking the jury provides evidence of bias is a second example of the fundamental flaw in the appellant’s approach to the bias claim. The appellant submits that in striking the jury, the trial judge simply adopted and echoed the submissions made by the respondents. The appellant claims this parroting of the respondents’ submissions demonstrates judicial bias.

[63] Although the appellant claims the trial judge’s ruling striking the jury demonstrates the trial judge’s bias, the appellant did not challenge the correctness of that ruling in its factum. Consequently, even if the trial judge simply repeated the respondents’ submissions (an unfair and inaccurate characterization of her reasons), the appellant did not allege those arguments led the trial judge to improperly strike the jury. How can accepting and even repeating meritorious arguments demonstrate judicial bias?

[64] In many respects, the bias allegations are redundant to the appellant’s case on appeal. The bias allegations assume the trial judge made serious and repeated errors during the trial. If those assumptions had merit, the appellant would succeed on the appeal by virtue of having demonstrated the serious errors without recourse to any bias allegation. On the other hand, if as we have concluded, the arguments alleging serious errors by the trial judge have no merit, the bias claim, as framed by the appellant, loses most of its force.

[65] In addition to alleging the trial judge’s rulings demonstrated bias, the appellant maintains that the trial judge’s facial expressions and body language also indicated bias against the appellant. The appellant relied on affidavits filed on the trial in support of this claim. Those affidavits were filed by Mr. Sezerman, his wife, and an articling student.

[66] These allegations are vague. Absent some manifestation of this alleged conduct in the record, or some other form of confirmatory evidence, it is difficult to ascribe much weight to a partisan’s subjective interpretations of a trial judge’s facial expressions or “body language”. These kinds of allegations alone cannot rebut the strong presumption in favour of judicial impartiality.

[67] The appellant also points to the number of rulings made against the appellant in the course of the trial as evidence of bias. A mere counting of the rulings for and against a party to a trial provides little insight into the fairness of the trial. In addition, the number of the rulings made against the appellant is accounted for, to a significant degree, by the appellant’s refusal to abide by the trial judge’s rulings, and its insistence on litigating over and over again some of the same issues.

[68] The appellant further submits the trial judge’s reference to Mr. Sezerman as the “puppet master” in her costs decision provides further evidence of bias. We disagree. The respondents were seeking costs against Mr. Sezerman personally. It was their position he personally controlled the litigation to the extent that he should be held personally responsible for aspects of the litigation, which on the respondents’ submissions justified increased costs. The trial judge was required to make a finding as to the role played by Mr. Sezerman.

[69] Her finding that Mr. Sezerman was indeed in full control of the litigation, even to the point of directing counsel as to what submissions should be made in closing and what questions should be put to witnesses, was supported on the record. The phrase “puppet master” is apt given her findings.

(ii) The Allegations of Institutional Bias

[70] Mr. Sezerman complains about the impartiality of other judges in the Ottawa region. He refers to an earlier case in which a judge described him as “bellicose”. He also relies on an appearance before another judicial officer in Ottawa, who described herself as “the fairest person in this place that is going to give you a proper hearing”. Mr. Sezerman interprets this remark as an indication that “the judges and other personnel in the Ottawa court system would not be fair to me”. Finally, Mr. Sezerman refers to the events surrounding the recusal of the judge initially assigned to conduct this trial.

[71] None of the events referred to by Mr. Sezerman offer any basis upon which a reasonable person could perceive institutional bias among the Ottawa judiciary toward Mr. Sezerman.

[72] The case in which the trial judge described Mr. Sezerman as “bellicose” was entirely unrelated to this case and occurred some ten years earlier. A single word in an entirely unrelated proceeding offers no basis upon which a reasonable and informed observer could conclude Ottawa judges were biased against the appellant. Nor does Mr. Sezerman’s success on appeal in that case offer any support for the bias claim. In allowing the appeal in part, the Court of Appeal was not critical of the trial judge or her use of the word “bellicose”: see Oz Optics Limited v. Timbercon, Inc., 2010 ONSC 310, rev’d 2011 ONCA 714.

[73] The comment relied on by Mr. Sezerman concerning the “fairest person in this place” is incapable of bearing the sinister connotation ascribed to it by Mr. Sezerman.

[74] Lastly, the recusal of the judge initially assigned to conduct the trial provides no support for a bias allegation. Counsel for the respondents learned that the judge initially assigned to the trial had previously been a partner at a law firm, that acted for one of the respondents. Counsel brought this to the attention of the court and a new trial judge was assigned.

[75] The appellant submits that while the assignment of the initial trial judge might seem “a simple oversight” it becomes “disturbing” in light of what happened after the assignment of the second trial judge who actually heard the trial.

[76] There is no objective basis for Mr. Sezerman’s concerns. It is common place that judges who are assigned to conduct a trial become aware of connections to the parties or their lawyers that make it prudent that someone else conduct the trial. That is exactly what happened here. Why any of this would be “disturbing” to a reasonable observer is left unexplained by the appellant.

[77] The allegations of an institutional bias against Mr. Sezerman are baseless.

(iii) Ethnic Bias

[78] In his affidavit, Mr. Sezerman insinuates that the trial judge took a personal dislike to him because he was an immigrant whose ethnic background and passion for the justice of his cause caused him to conduct himself in court in a manner which the trial judge considered inappropriate and disrespectful. Mr. Sezerman asserts he intended no disrespect.

[79] There is nothing in the record to support the suggestion that Mr. Sezerman’s ethnic background had anything to do with the trial judge’s rulings or conduct of the trial. Clearly, the trial judge found some of Mr. Sezerman’s conduct inappropriate and worthy of sanction. In several of her rulings, the trial judge set out in detail the conduct of Mr. Sezerman she found to be inappropriate and explained why that conduct was inappropriate. Some of the trial judge’s reasons related to Mr. Sezerman’s behaviour in court, however, the trial judge was primarily troubled by Mr. Sezerman’s adamant refusal to abide by rulings made during the trial. The trial record supports the trial judge’s factual findings in this regard.

[80] The trial judge had the onerous responsibility of keeping this long, sometimes heated, trial on the rails. Her task was made all the more difficult by the presence of the jury. To do so, the trial judge had to insist the parties comply with her rulings and comport themselves in court in a manner consistent with the proper administration of justice. No doubt Mr. Sezerman was passionate about his cause, and no doubt he was dissatisfied with the way the trial was going. Neither Mr. Sezerman’s passionate belief in his cause, nor his firm belief the trial was not being conducted fairly, relieved him of his obligation to comply with the trial judge’s orders and control his behaviour in court. The trial judge’s insistence that Mr. Sezerman follow the rules or face the consequences demonstrates neither a personal dislike of Mr. Sezerman, nor a bias based on his ethnic background. It does reveal the trial judge was determined to keep the trial moving forward in accordance with the rules, even if the appellant was wholly dissatisfied with the way the trial was unfolding.

[81] There is no merit to any part of the bias allegation.

[82] The appeal from the dismissal of the action against the respondents is dismissed.

The Costs Appeal

(i) The Costs Awarded Against the Appellant

[83] The respondents were completely successful at trial. They had made substantial six figure offers to settle about two years before the trial. The offers remained outstanding at the time of trial. [5]

[84] Applying well established authority, the trial judge held the respondents were entitled to their costs on a partial indemnity basis up to the date of the offers, and on a substantial indemnity basis after the date of the offers: S & A Strasser Ltd. v. Richmond Hill (Town) (1990), 1 O.R. (3d) 243 (C.A.); Costs Decision, at paras. 25-35.

[85] The trial judge was also satisfied the appellant’s conduct in the course of the trial warranted an elevated costs award. She set that conduct out in some detail in her reasons and concluded it justified an award of substantial indemnity from the date of trial. Although the trial judge’s finding that the conduct of the appellant merited an award of costs on a substantial indemnity basis was supportable on this record, it was unnecessary to the trial judge’s finding with respect to the respondents’ entitlement to costs on a substantial indemnity basis. The trial judge had determined, apart from the appellant’s conduct, based on the offers to settle, that the respondents should have substantial indemnity costs from the date of the offers in 2017, well before the commencement of the trial: Costs Decision, at paras. 36-39.

[86] The trial judge did not err in awarding costs to the respondents on a partial indemnity basis to the date of the offers and, thereafter, on a substantial indemnity basis. Even disregarding the appellant’s conduct at the litigation, the award was consistent with well-established case law.

[87] We also see no error in the quantum awarded against the appellant. This litigation was lengthy, convoluted and hard fought. The trial consumed about nine weeks. On the findings of the trial judge, the actions of the appellant, particularly the repeated re-litigation of issues previously decided, unnecessarily prolonged the litigation. The trial judge also properly took into account the quantum of costs claimed by the appellant.

[88] The trial judge appreciated that the ultimate determination of costs must reflect a fair and reasonable amount that the losing party should reasonably expect to pay rather than an actual indemnification of the amount actually expended by the successful parties: Costs Decision, at para. 50. We see no basis upon which this court should interfere with the trial judge’s assessment.

(ii) The Costs Awarded Against Mr. Sezerman Personally

[89] Mr. Sezerman was initially a plaintiff, but he was no longer a party to the litigation at trial. The trial court has inherent jurisdiction to award costs against a non-party. That discretion is exercised sparingly in cases involving “gross misconduct, vexatious conduct, or conduct that undermines the fair administration of justice”: 1318847 Ontario Limited. v. Laval Tool & Mould Ltd., 2017 ONCA 184, at paras. 66, 76.

[90] The trial judge appreciated the limits on her authority to order costs against Mr. Sezerman. She ultimately concluded that Mr. Sezerman controlled the appellant’s conduct throughout the litigation. After detailing that conduct, the trial judge said, at para. 59:

Mr. Sezerman bears responsibility for the plaintiff’s litigation conduct at trial – conduct I have determined to be egregious and worthy of the court’s sanction.

[91] The appellant has not demonstrated any error in the trial judge’s description of the conduct at the litigation, her determination that Mr. Sezerman was personally responsible for that conduct, or her ultimate conclusion that the conduct merited a significant costs sanction against Mr. Sezerman personally. We agree with the trial judge that Mr. Sezerman assumed personal control over the conduct of the litigation. His attempts to excuse or even justify his conduct based on his temperament and the inexperience of his counsel should carry no weight when deciding whether Mr. Sezerman should be personally responsible for some part of the costs. Mr. Sezerman is a mature, intelligent person and a successful businessman. He must bear personal responsibility for his personal misconduct during the trial: Costs Decision, at paras. 57-59. We also see no error in the trial judge’s quantification of the extent of Mr. Sezerman’s personal responsibility.

[92] We grant leave to appeal the costs order but dismiss the appeal.

Conclusion

[93] The appeal is dismissed.

[94] Counsel for the respondents shall serve and file written submissions as to the costs of the appeal within 10 days of the release of these reasons. The submissions shall not exceed 4 pages, double-spaced, not including any bill of costs. The appellant shall serve and file its written submissions as to costs within 10 days of receiving the respondents’ submissions. The appellant’s submissions shall not exceed 4 pages double-spaced, excluding any bill of costs. The respondents may file written reply submissions of no more than 2 pages within 7 days of receiving the appellant’s submissions.

Released: “DD July 19, 2021”

“Doherty J.A.”

“M.L. Benotto J.A.”

“Grant Huscroft J.A.”

[1] The appellant did attach, as an exhibit to the “fresh evidence” affidavit of Mr. Sezerman, a document entitled “Errors in Trial Judge’s Assessment of 69 Grounds to Strike Jury”. The exhibit is not evidence of anything, but is argument presumably advanced by Mr. Sezerman. Counsel did not challenge the striking of the jury in the factum filed on the appeal or in oral argument. During oral argument, counsel confirmed the striking of the jury was not a ground of appeal in the appellant’s factum. After some further dialogue with the court, counsel sought to “amend” the appellant’s argument to add a claim that the jury was improperly struck. The court indicated it was not disposed to permit counsel to advance new grounds of appeal during oral argument. Counsel did not pursue the matter.

[2] There is one paragraph in the appellant’s factum (para. 54) in which the appellant submits the evidence relating to two of the three relevant events demonstrates an intention by the respondents to cause economic harm to the appellant. The factum does not point to or even allege any errors by the trial judge in her analysis of the relevant evidence. There is no basis upon which to interfere with her finding: see Reasons at para. 87-91, 128-133.

[3] Mr. Prasad, who appeared as lead counsel on the appeal, was not counsel at trial.

[4] In oral argument, counsel who is alleged to have been incompetent at trial, and who appeared for the appellant on the appeal, attempted to make a statement to the court, presumably in support of the ineffective assistance of counsel claim. The court refused to permit counsel to make that statement. If counsel wanted to admit his incompetence in support of the appeal, his role was that of a witness, and not counsel on the appeal. The appellant chose not to file an affidavit from trial counsel.

[5] EODSA and OSA were represented by the same counsel and were awarded one set of costs.