Court of Appeal for Ontario

Date: 2025-05-09
Docket: COA-24-CV-1015

Coram: Paul Rouleau, K. van Rensburg, S. Gomery

Between

William “Bill” Pye
Plaintiff (Respondent)

and

Carmela Di Trapani and Vincenzo Di Trapani
Defendants (Appellants)

Counsel:

• David T.S. Wong and Sanket Ullal, for the appellants
• Christopher Morrison and Margaret Klassen, for the respondent

Heard: 2025-05-01

On appeal from the costs order of Justice Antonio Skarica of the Superior Court of Justice, dated March 8, 2024.

Reasons for Decision

Introduction

[1] The appellants appeal the trial judge’s costs order made at the end of an 18-day civil jury trial in respect of the respondent’s injuries sustained in a motor vehicle accident that occurred in 2016. The trial judge awarded the respondent costs of $995,854.50, inclusive of disbursements and HST, and prejudgment interest in the sum of $84,944 at an annual rate of 3%. The appellants contend that the trial judge erred by:

(i) accepting the respondent’s fees and disbursements without adequately questioning them;
(ii) failing to apply the principles of reasonableness and proportionality in determining the amount of costs; and
(iii) awarding prejudgment interest at a rate of 3% rather than the presumptive rate of 0.8% in the Courts of Justice Act, R.S.O. 1990, c. C.43.

Standard of Review

[2] The trial judge’s costs award is entitled to deference unless the appellants establish that the trial judge made an error in principle or the order is plainly wrong: Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, [2004] 1 S.C.R. 303, at para. 27.

Reasonableness in Fixing Costs

[3] In fixing costs, the overriding principle is reasonableness. As stated in Davies v. Clarington (Municipality), 2009 ONCA 722, 100 O.R. (3d) 66, at para. 52:
“Rather than engage in a purely mathematical exercise, the judge awarding costs should reflect on what the court views as a reasonable amount that should be paid by the unsuccessful party rather than any exact measure of the actual costs of the successful litigant.”

First Ground of Appeal: Scrutiny of Fees and Disbursements

[4] We reject the first ground of appeal. The trial judge’s reasons show that he was appropriately focused on the overall reasonableness of the respondent’s costs claim and adequately explained why he considered the amount sought to be reasonable. He was not required to perform a line-by-line review of fees charged for discrete tasks or second guess amounts paid for specific disbursements. In any event, the appellants did not challenge the amount of time spent by the respondent’s counsel; the focus was on the applicable hourly rates.

Second Ground of Appeal: Reasonableness and Proportionality

[5] The appellants’ arguments on the second ground focus on two issues: the hourly rates charged by members of the respondent’s legal team, and the proportionality of the costs award relative to the jury’s damages award.

[6] The trial judge referred to the factors listed in r. 57.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 and the relevant case law. He explained at length why he found the hourly rates charged by the respondent’s legal team to be reasonable. He found that each of the three lawyers on the team brought expertise essential to the proper and efficient conduct of the trial, and that all three counsel “worked efficiently as a highly skilled team”. He found that, in the circumstances of this case, the effectiveness of counsel was more important than their years at the bar. As he explained, the respondent’s legal team obtained a significant damages award for their client in a complex case, and their efforts led to the trial being conducted efficiently, with no down time.

[7] It was open to the trial judge to conclude, based on these findings, that the rates charged by respondent’s counsel were reasonable and fair.

[8] The appellants contend that the costs award is unreasonable because it is roughly the same amount that the jury awarded the respondent for his damages and because the respondent’s costs were much higher than their own.

[9] We disagree. The trial judge was clearly alive to these issues. Here, the trial judge concluded that the respondent was reasonably entitled to the amount claimed for costs that were roughly equivalent to his damages, in no small part because he achieved a result that exceeded his offer to settle: the respondent’s costs included substantial indemnity costs from the date the offer was made seven months before the commencement of the trial. The difference between the billable rates charged by counsel for the two parties did not reflect an excessive hourly rate charged by the respondent’s lawyers for reasons already mentioned. Finally, we note that the costs award included the sum of $165,321.45 in disbursements. The majority of the disbursements were not at issue.

[10] We have carefully reviewed the record and the submissions of the parties. We see no basis for interfering with the trial judge’s assessment of what was “fair, reasonable and appropriate” in the circumstances of this case. We accordingly reject the second ground of appeal.

Third Ground of Appeal: Prejudgment Interest Rate

[11] With respect to the third ground of appeal, the parties disputed the appropriate prejudgment interest rate. While the statutory rate was 0.8%, because of the many years over which prejudgment interest would be calculated, the respondent sought a higher rate (5%). The trial judge awarded prejudgment interest at the rate of 3%, concluding:

Given the factors outlined in section 130(2) of the Courts of Justice Act and the fluctuating market interest rates as detailed in Exhibit 1, Canada Interest Rate, and the increases in the inflation rate as set out by the plaintiff in its submissions, I find a fair and reasonable prejudgment interest rate to be three per cent. As outlined in Tab 2 of the plaintiff’s submission the period to be considered is July 2nd, 2016 to October 12th, 2023 for general and special damages and July 2nd, 2016 to September 18th, 2023 for past loss of income.

[12] The appellants submit that not applying the statutory rate of 0.8% was an error in the trial judge’s exercise of discretion. They assert that the trial judge failed to consider that the bulk of changes to the inflation rate and interest rate took place during the one year time frame when the action was supposed to proceed to trial but did not due to two adjournments. While the adjournments were sought by the respondent, the first was consented to, while the second resulted from circumstances beyond the control of any of the parties and was not opposed.

[13] Again, this court must adopt a deferential standard of review to a trial judge’s exercise of discretion under s. 130 of the Courts of Justice Act: see MDS Inc. v. Factory Mutual Insurance Company, 2021 ONCA 594, 465 D.L.R. (4th) 294, at paras. 99, 105, leave to appeal refused, [2021] S.C.C.A. No. 382; Stellarbridge Management v. Magna International (2004), 71 O.R. (3d) 263 (C.A.), at para. 85, leave to appeal refused, [2004] S.C.C.A. No. 371.

[14] We are not persuaded that the trial judge erred in the exercise of his discretion under s. 130. He considered and rejected the arguments raised by the appellants that are repeated on appeal. It was open to him, in the circumstances of the case, to fix a prejudgment interest at the rate of 3%.

Disposition

[15] For these reasons, we dismiss the appeal, with costs of $20,000 all-inclusive for both the appeal and the motion for leave to appeal.

Paul Rouleau
K. van Rensburg
S. Gomery