Superior Court of Justice - Divisional Court

Court File No.: 477/02 Date: 2004-07-19

Before: O'Driscoll, Then and MacKenzie JJ.

Between:

Wilfred Robert Pearson Appellant/Plaintiff

• and -

Inco Limited, Her Majesty the Queen in Right of Ontario, The Corporation of the City of Colborne, The Regional Municipality of Niagara, The District School Board of Niagara and The Niagara Catholic District School Board Respondents/Defendants

Endorsement as to Costs

[1] By letter, dated February 26, 2004, counsel for the Attorney General for Ontario advised that: "By virtue of a general settlement reached between Ontario and the plaintiff yesterday, cost submissions are no longer necessary."

[2] Counsel for the Appellant/Plaintiff (Pearson) and counsel for the Respondent/Defendant Inco Limited (Inco) have been unable to agree on costs on the appeal to this Court from the refusal of Nordheimer J., dated July 16, 2002 and September 15, 2002 to certify this action under the Class Proceedings Act, S.O. 1992, c. 6 (CPA).

[3] Inco has filed submissions as to costs, dated February 27, 2004; Pearson, on March 2, 2004, filed response submissions. Counsel for Inco filed reply submissions, dated March 9, 2004.

[4] The Bill of Costs submitted by Inco shows:

(a) preparation of Inco for appeal $43,854.00 (b) counsel fee on three (3) day appeal $ 9,000.00 (c) preparation of costs submissions $ 2,020.00 $54,874.00 (d) disbursements $ 1,340.09 (e) G.S.T. @ 7% on fees $ 3,841.18 (f) G.S.T. @ 7% on disbursements $ 93.81 Total $60,149.08

[5] In para. [50] of our reasons of February 6, 2004, we agree with Nordheimer J.'s finding that none of the considerations under s. 31(1) of the CPA is applicable. Those considerations are:

(i) whether the class proceeding was a test case, (ii) raised a novel point of law, or (iii) involved a matter of public interest.

[6] On his appeal to the Divisional Court, Pearson appealed the costs award of the Motions Court judge. We held that there was no reversible error in the reasoning or in the conclusion reached by Nordheimer J. in his disposition of costs. We see no reason to vary or waiver from our reasons of February 6, 2004.

[7] In Direnfeld v. National Trust, [2001] O.J. No. 1706, Cumming J. said:

[2]….Costs normally follow the event in a civil action, including a class action.

[8] In this case, if the action had been certified, the amount claimed was $600 million damages and $150 million punitive damages. The amount of the claim was reduced when 8,000 potential class members ceased to be claimants and the claim was narrowed to real property damage. However, the remaining claim was still potentially large, one which would cause Inco to spend substantial time preparing for the appeal.

[9] In Chadha v. Bayer Inc. (2003), 2003 24282 (ON CA), 170 O.A.C. 126 (Ont. C.A.: Austin, Feldman and Rosenberg JJ.A.), the Court, in a costs endorsement, said:

3. … In order to fix an appropriate amount for costs, we have considered the following factors: (1) the amount claimed in the class proceeding, had it been certified, was $100,000.000., which justifies the significant expenditure of time in preparation for the appeal; (2) the appellant would know that given the magnitude of the claim, the respondents would spend substantial time in preparation for the appeal; (3) on the other hand, the bulk of the respondents' preparation would have been done for the Divisional Court appeal; (4) it would not be appropriate to provide compensation for two sets of lead counsel. Based on these factors, an appropriate order on a partial indemnity scale is $50,000.

[10] In their written submissions, filed March 2, 2004, counsel for Pearson, from para. [22] to [26], seek a "no costs order" or in the alternative, a "reduced costs order, payable in the cause" based on alleged impecuniosity. It is public knowledge and a matter of public record that Pearson is funded by Environmental Defence Canada (EDC). During argument of the appeal, counsel for the Attorney General for Ontario handed up to the panel a page from the EDC website which advises of the funding.

[11] The bill of costs submitted appears to be reasonable – it has dockets verifying 152.5 hours of preparation claimed. In our view, there is no reason or basis to tinker with or shave the draft bill of costs submitted.

[12] In the result, Inco's costs of the appeal are fixed at $60,149.08, payable forthwith by Pearson.

O'Driscoll J.

Then J.

MacKenzie J.

Released: