Court of Appeal for Ontario

Date: 2022-08-31 Docket: C68799

Before: Lauwers, Roberts and Nordheimer JJ.A.

Between:

Aylmer Meat Packers Inc. Plaintiff (Appellant)

And:

Her Majesty the Queen in Right of Ontario and the Attorney General of Canada Defendants (Respondent)

Counsel: Jonathan C. Lisus and Zain Naqi, for the appellant Darrell Kloeze and Adam Mortimer, for the respondent

Heard: In writing

On appeal from the judgment of Justice Kelly C. Tranquilli of the Superior Court of Justice, dated October 5, 2020, with reasons reported at 2020 ONSC 6053.

Costs Endorsement

[1] On August 10, 2022, we released our decision in which we allowed the appeal in part and awarded Aylmer damages in the amount of $3,520,000. We awarded the appellant the costs of the appeal fixed in the agreed amount of $25,000, inclusive of disbursements and HST. We then invited the parties to make written submissions on two issues. One was whether prejudgment interest should be awarded. The second was respecting the amount and allocation of the trial costs. We have now received and reviewed the parties’ written submissions on these two issues.

[2] The appellant asks for its costs of the trial in the amount of $750,000 which was the agreed amount for costs that was awarded to the respondent by the trial judge when the action was dismissed. The appellant also asks for prejudgment interest in the amount of $2,317,092.27, based on the statutory rate of 2.8%, compounded annually, from April 2004 to the date of this court’s judgment.

[3] The respondent does not dispute that the appellant is entitled to its costs of the trial but submits that the amount should be lower because the appellant was not successful on all of the claims that it advanced. The respondent also submits that the amount for prejudgment interest should be reduced because of the time that it took the appellant to prosecute its claim (18 years). The respondent further submits that the amount for prejudgment interest should be not compounded.

[4] We agree generally with the points made by the respondent. The appellant advanced many different claims over the course of the litigation, some of which were dropped and others were unsuccessful. The only claim advanced by the appellant on which it was successful was for damages directly attributable to the occupation of the Plant, which caused the cessation of the appellant’s business.

[5] In our view, an award of costs in the amount of $475,000 inclusive of disbursements and HST is a fair and reasonable amount to fix for the costs of the trial given the limited success that the appellant achieved. That amount still reflects the reasonable expectation of the parties and bears an appropriate relationship to the earlier agreed amount of $750,000, given that divided success.

[6] On the issue of prejudgment interest, there is no basis for awarding compound interest. This is not a case like Enbridge Gas Distribution Inc. v. Marinaccio, 2012 ONCA 650, 355 D.L.R. (4th) 333 on which the appellant relies. In particular, this is not a case where the appellant intended to continue to operate its business once the plant was seized. Rather, it was a case where the appellant complained that it could not sell the plant. This case is also not a case of breach of trust or breach of fiduciary duty where compound interest has been awarded in other cases.

[7] Finally, we agree with the respondent that there should be a reduction in the amount for prejudgment interest because of the delay in prosecuting this case. A plaintiff cannot take an inordinate amount of time to bring its claim to trial and then expect that it will be rewarded for that delay through prejudgment interest. In this case, a period of 18 years is a delay that was unexplained and manifestly unreasonable on the facts and, thus, justifies a reduction. In the result, we fix the amount for prejudgment interest at $600,000.

[8] The respondent will pay the appellant $475,000, inclusive of disbursements and HST, for the costs of the trial and will also pay the appellant $600,000 in prejudgment interest.

“P. Lauwers J.A.”

“L.B. Roberts J.A.”

“I.V.B. Nordheimer J.A.”