London Divisional Court File Nos.: 1487 and 1488
DATE: 20060524
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
O’DRISCOLL, CHAPNIK AND WILSON JJ.
B E T W E E N:
KENNEDY ELECTRIC LIMITED, R & A INDUSTRIAL CONTRACTORS LTD., EMPIRE TRANSPORTATION LIMITED, HYDRAMEN FLUID POWER LTD., CASSIDY INDUSTRIAL CONTRACTORS LTD., 1480253 ONTARIO, INC. C.O.B. AS DYNAMIC SYSTEMS, FASTENING HOUSE INC.
Appellants/Plaintiffs/Lien Claimants
- and -
DANA CANADA CORPORATION and RUMBLE AUTOMATION INC.
Respondents/Defendants
COSTS ENDORSEMENT: THE APPEALS TO THE DIVISIONAL COURT
O’DRISCOLL J.:
[1] On September 9, 2003, Haines J. ordered the trial of an issue under the Construction Lien Act, R.S.O. 1990, c. C. 30 (CLA) as to whether the work performed by the plaintiff, Kennedy Electric Limited (Kennedy) and other companies, in installing a new assembly line at Dana Canada Corporation’s (Dana) facility at St. Mary’s, Ontario, afforded Kennedy and the other installers with a lien under the CLA on the St. Mary’s property. In summary, did the work qualify as an “improvement” to the land under s. 1(1) of the CLA?
[2] The trial judge, Killeen J., heard six (6) days of evidence and submissions and reserved judgment. On November 18, 2004, Killeen J. heard and reserved a motion to admit new evidence.
[3] On November 24, 2004, Killeen J. released written reasons in which he dismissed the motion to admit fresh evidence and held that the proposed liens were not lienable under the CLA. The reasons of the trial judge are reported: (2004), 2004 47787 (ON SC), 73 O.R. (3d) 530.
[4] The law report shows counsel before Killeen J. at the six (6) day hearing were:
(a) J. Stephen Tatrally for Kennedy Electric Limited
(b) Irwin A. Duncan and Michael van Bodegom for Cassidy’s Industrial Contractors Limited and other lien claimants
(c) Anthony Wellenreiter, Q.C., for lien claimant, Empire Transportation Ltd.
(d) Matthew Alter and James W. MacLellan, for the defendant Rumble Automation Inc.
(e) Christopher Chekan, for the defendant Dana Canada Corporation
[5] In his later endorsement as to costs, [[2005] O.J. No. 2202], Killeen J. awarded costs to Rumble at $78,167 plus $1,500 for preparation of the bill of costs.
[6] Killeen J. ordered that Kennedy pay 75% of the defendant’s costs of the trial of the issue with 12.5% being paid by Cassidy and 12.5% by Empire Transport.
[7] Killeen J. held that he was unable to fix the costs of Dana because “Mr. Chekan’s draft bill of costs is not in proper form”. Killeen J. instructed that a proper bill of costs be submitted.
[8] Subsequent to Killeen J.’s judgment of November 24, 2004, Rumble and Kennedy settled their dispute.
[9] Kennedy then launched appeal No. 1487 against Dana. R & A Industrial Contractors Ltd. (R & A) and Cassidy launched appeal No. 1488 against Rumble and Dana.
[10] Before the Divisional Court the following parties were represented by counsel:
(a) A.J. Esterbauer (from the same firm as J. Stephen Tatrally who appeared at trial), for Kennedy,
(b) Irwin A. Duncan (who appeared at trial for Cassidy) for Cassidy and R & A Industrial Contractors Ltd.,
(c) C.A. Chekan (who appeared at trial for Dana),
(d) M.A. Davis for Rumble (M.R. Alter and J.W. MacLellan, who had appeared for Rumble at the trial are from the same firm).
[11] The appeal was heard at London, Ontario on February 6 & 7, 2006. Judgment was reserved and released on March 14, 2006 [[2006] O.J. No. 972]. The majority dismissed the appeal. Chapnik J., dissenting, would have allowed the appeal. The majority and the minority reasons each called for written submissions if counsel were unable to agree on costs.
[12] Counsel did not agree on costs.
[13] In the majority’s decision it is stated:
[19] As I read the facta of counsel for the Appellants and as I understood their submissions, they do not quarrel with the findings of fact made by the trial judge. I do not recall any submissions that the trial judge made any palpable and overriding error with regard to the facts. I take that to mean that the facts are as the trial judge states them to be in his reasons.
[20] The issues in this case are: did the trial judge apply the correct law in the correct manner to the facts as he found them?
[34] With respect, in my view, the trial judge correctly applied the correct law to the facts as he found them.
[3] The issue in these appeals is whether the services performed by Kennedy and its subcontractors, including Cassidy constitutes an “improvement” to land, within the meaning of section 1(1) of the CLA, giving rise to lien rights.
[14] In our view, there was nothing new or novel on the appeal. The appeal was a recycling of the same legal arguments submitted to Killeen J.
[15] As a result of an order, on consent, the appeals were argued together.
[16] Our task is to fix costs and in doing so to arrive at an amount that is fair and reasonable to the unsuccessful party, according to the principles set out in:
Section 131 of the Courts of Justice Act, R.S.O. 1990, c. C. 43,
Rule 57.01 of the Rules of Civil Procedure, and
Boucher et al. v. Public Accountants Council for the Province of Ontario et al. (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291 (Ont. C.A.).
[17] In Appeal No. 1488, counsel for Rumble submits a Bill of Costs, in proper form, on a partial indemnity basis seeking $20,515.72, all-inclusive. Because Rumble had settled with Kennedy after Killeen J.’s decision, Rumble does not seek any of the $20,515.72 from Kennedy but only from R & A Industrial Contractors Ltd. and Cassidy.
[18] In his written submissions, counsel on behalf of Cassidy and R & A, Mr. Duncan states:
- These appellants do not dispute the quantum of the fees and disbursements claimed on behalf of Rumble Automation.
[19] Rumble’s costs on appeal 1488 are fixed at $20,515.72, all-inclusive.
[20] Counsel for Dana has submitted a Bill of Costs seeking $24,614.70 from Kennedy and in a separate Bill of Costs seeks $16,409.80 from Cassidy and R & A. In his written submissions, counsel for Kennedy, Mr. Esterbauer, states:
The Defendant (Respondent) Dana Canada Corporation (“Dana”) is requesting costs as against the Plaintiff (Appellant) Kennedy Electric Limited (“Kennedy”), in the total sum of $24,614.70. Kennedy says that the request is excessive, as set forth below.
Kennedy does not take issue with the amount requested by Dana for the attendance at the hearing of the appeals, in the aggregate of $2,200.00. While Kennedy also does not take issue with the itemized disbursements, Kennedy submits that the disbursements claimed as against Kennedy and as against the Appellants in Divisional Court File Number 1488, appear to be duplicated and the amount should be split and only one-half should be allocated to the costs of the Kennedy appeal, Divisional Court Number 1487.
The amount claimed by Dana’s counsel for preparation, of approximately 144 hours, is exorbitant and should be substantially reduced. Dana also claimed preparation time in relation to the companion appeal, Divisional Court Number 1488, of approximately 89 ½ hours. These times are in addition to the two hearing days, which Dana claimed separately. By comparison, the Defendant (Respondent) Rumble Automation Inc. (“Rumble”) expended approximately 57 hours of counsel time, in relation to both appeals, including the hearing.
Kennedy submits that the time claimed for preparation by Dana is patently unreasonable, and should be reduced. Kennedy submits that an allocation of 40 hours of preparation for the appeal, at the rate claimed of $150.00 per hour, would be an appropriate allocation for preparation time to Dana in respect of the Kennedy appeal.
[21] In his written submissions on behalf of Cassidy and R & A, Mr. Duncan states:
- With respect to the fees and disbursements claimed on behalf of Dana, these appellants submit that the claim is excessive. These appellants adopt the submissions made on behalf of Kennedy Electric Limited in this regard.
[22] It is an understatement to say that Mr. Chekan’s $41,024.52 claim for costs on these appeals is excessive.
[23] Because no counsel quarreled with any of the findings of fact made by Killeen J., these appeals were argued together on what was tantamount to an agreed statement of facts. There were no new or unusual arguments on appeal that had not been argued before Killeen J. On these appeals the same narrow legal issues were argued. This, in our view, is not a situation that would justify two (2) sets of costs.
[24] The costs of Dana on these appeals are confined to one set of costs fixed at $15,800.00, all-inclusive.
Who Pays the Costs?
[25] Counsel for Cassidy and R & A submitted that there should be a pro rata allocation of all costs of the appeals in relation to the amount of the liens claimed. Thus, Kennedy would pay 92.3% of all costs of the appeals, Cassidy would pay 7.2% and R & A would pay 0.5%.
[26] Taking into consideration the parties who appeared on these appeals, the nature of the appeals, the positions taken, the ends of justice, in our view, would be best served by the following order:
(1) Kennedy shall pay Dana’s fixed costs at $15,800.00 within thirty (30) days of the release of this endorsement.
(2) Cassidy and R & A, shall jointly and severally pay Rumble’s costs fixed at $20,515.72 within thirty (30) days of the release of this endorsement.
O’Driscoll J.
Chapnik J.
Wilson J.
Released:
London Divisional Court File Nos.: 1487 and 1488
DATE: 20060524
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
O’DRISCOLL, CHAPNIK AND WILSON JJ.
B E T W E E N:
KENNEDY ELECTRIC LIMITED, R & A INDUSTRIAL CONTRACTORS LTD., EMPIRE TRANSPORTATION LIMITED, HYDRAMEN FLUID POWER LTD., CASSIDY INDUSTRIAL CONTRACTORS LTD., 1480253 ONTARIO INC. C.O.B. AS DYNAMIC SYSTEMS, FASTENING HOUSE INC.
Appellants/Plaintiffs/Lien Claimants
- and -
DANA CANADA CORPORATION and RUMBLE AUTOMATION INC.
Respondents/Defendants
COSTS ENDORSEMENT
O’Driscoll J.
Released: May 24, 2006