COURT FILE NO.: 68/04

DATE: 20050418

SUPERIOR COURT OF JUSTICE – ONTARIO

DIVISIONAL COURT

RE: Patrick Boland, Plaintiff (Appellant)

-and-

APV Canada Ltd Defendant (Respondent)

-and-

Director of Employment Standards, Ministry Of Labour Intervenor

HEARD: December 2, 2004

BEFORE: Lane, Matlow and Ground JJ.

COUNSEL: Bram A. Lecker, for the Appellant Christopher Diana, for the Respondent Eric del Junco, for the Intervenor.

ENDORSEMENT AS TO COSTS

[1] On February 14, 2005, we released reasons allowing this appeal, granting summary judgment for the plaintiff for his entitlements under the Employment Standards Act (ESA) and awarding the plaintiff costs here and before the motion judge. The issues in the case were whether the plaintiff’s ESA entitlements could be claimed in an action and were subject to an obligation to mitigate. The Director intervened on the basis that the issues were of importance to thousands of workers and had not been addressed definitively by the courts.

[2] The plaintiff submitted a bill of costs for the entire action for 82.3 hours at $350/hr. for a total of $28,805 for fees plus $919 in disbursements plus GST, all of which comes to $31,785. The plaintiff submits that we should award him these costs on a substantial indemnity basis because he will not be pursuing the wrongful dismissal portion of his claim but is content with the award of the ESA entitlements, because there are relevant offers, and because there are public policy considerations.

[3] The defendant responds that there should be no costs at all because the appeal settled the law on an issue of significant importance to employers and employees in Ontario. Alternatively, the defendant submits that there should be partial indemnity costs only because the amount at stake is barely above the Small Claims level, the amount of costs bears no relation to what was at stake and is beyond the reasonable expectations of the parties; and the offers do not comply with Rule 49 which, in any event, does not apply to appeals. Counsel submits that a fair amount would be $5,000.

[4] I do not think that we have the costs of the whole action before us. Our order granted the appellant costs of the appeal and of the motion for summary judgment from which the appeal was taken. We expressly noted that the appellant was free to proceed with the balance of the action as it was not before us.

[5] Nor do I think that this is a case where there should be no costs because of the public importance of the settling of a point of law. That is all very well in some cases, but here the result would be a hardship on the plaintiff whose recovery is modest compared to the cost of getting it. I do not think that his bad luck in getting into such a case should work to his disadvantage.

[6] The two offers to settle do not appear to comply with Rule 49. That of December 2003 was only open until December 21, 2003, and not until trial. The subsequent offer was made during the pendency of the appeal and Rule 49 does not directly apply. Nevertheless, under Rule 57 we are to take into account any offer to settle, and the clear import of these offers was that the plaintiff would settle for his ESA entitlements and drop the wrongful dismissal claim. The efforts of the plaintiff to resolve the case confirm his willingness to compromise and the offers would have been significantly less costly to the defendant than the result of the appeal. Nevertheless, I do not see a proper basis on which to award substantial indemnity costs.

[7] Recent jurisprudence has stressed that the fixing of costs is not an arithmetic exercise but rather an effort to reach a figure that is fair and reasonable to both sides. Considerations of access to justice also are relevant, as are the reasonable expectations of the parties. Another principle is that small cases, such as the present, simply cannot bear large fees. This is reflected in the view that the costs must bear some reasonable relationship to what is at stake and that maximum hourly rates are reserved for maximum cases. In reaching the figures which I would award, I have had regard to all of these principles.

[8] An award of costs in this case in excess of what was at stake seems to me to exceed the reasonable expectations of the parties and to be excessive. The sum requested, approximately $31,000, is simply out of the appropriate range. Even when reduced by a third to reflect a rule of thumb as to the relationship of substantial indemnity costs to partial indemnity costs, it exceeds what was realistically at stake by a large margin. I think that a reasonable figure in this case is $4,500 for the motion and $6,000 for the appeal, bearing in mind the additional work of being appellant and the cost of dealing with correspondence and review of materials connected to the intervention. To that must be added the disbursements claimed of $919 and applicable GST.

Lane J.

Matlow J.

Ground J.

DATE: April 2005