COURT FILE NO.: 231/05

DATE: 2006/02/02

SUPERIOR COURT OF JUSTICE - ONTARIO

DIVISIONAL COURT

RE: SLMSOFT.COM INC. v. ERNST & YOUNG INC., IN ITS CAPACITY AS trustee in the estate of rampart securities inc.

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ERNST & YOUNG INC., IN ITS CAPACITY AS trustee in the estate of rampart securities inc. v. slmsoft.com inc., et al.

BEFORE: Justice Epstein

COUNSEL: Kenneth Prehogan and Paul D. Guy, for the Moving Party, Defendant by Counterclaim, St. James Securities Inc.

M.J. Dermer and Brent W. Mescall, for the Respondent, Plaintiff by Counterclaim, Ernst & Young Inc. in its capacity as Trustee in the Estate of Rampart Securities Inc.

HEARD: November 29, 30, and December 1, 2005 (in writing)

E N D O R S E M E N T A S T O C O S T S

EPSTEIN J.

[1] On November 10, 2005 I released my decision in which I dismissed St. James Securities Inc.’s motions for leave to appeal to the Divisional Court the decision of Ground J. dated August 9, 2004, granting a Mareva injunction restraining St. James from dealing with any of its assets and to adduce new evidence on the motion. I indicated that if the parties could not resolve the issue of costs, they could make written submissions on the appropriate disposition. I have now received and reviewed those submissions.

[2] The responding party, Ernst & Young Inc., in its capacity as trustee in the estate of Rampart Securities Inc. seeks its costs of the motions on a partial indemnity basis in the amount of $52,337.23 inclusive of disbursements and GST. It has submitted a Bill of Costs in support of this claim.

[3] St. James agrees that the costs, if awarded, should be on a partial indemnity scale but, predictably, takes issue with the quantum. Counsel for St. James submits that costs in the range of $15,000 would be appropriate.

[4] There is no reason why the Trustee should not be entitled to its costs of both motions and there is agreement that they should be fixed on a partial indemnity basis.

[5] The motions took a full day to argue. Concerning what was at issue, on the one hand motions for leave to appeal are always important as there is no appeal from the decision. It is either determinative of the issues decided below or opens the door to an appeal. In this case, given the subject matter and history of the litigation, the nature of the parties and the consequences of the decision under review, the stakes were high.

[6] Relating specifically to the factors set out in rule 57.01(1) as amended, I conclude that both motions were relatively complex, for different reasons. The motion to adduce fresh evidence raised an issue that had previously only received limited judicial consideration. While the motion for leave was to a large extent a review of the matter that had been argued at some length before Ground J., albeit against the backdrop of different legal considerations, the record was voluminous and the issues complex.

[7] I note that the Trustee failed to provide, with its Bill of Costs, any docket entries or other form of time summaries that would permit me to review the time spent with a view to determining its reasonableness. Rather, I was simply given the total hours spent by each lawyer involved in the matter. It is clear that fixing costs is not to be an arithmetic calculation following a detailed review of each and every docket entry. However, this omission does impair my ability to determine the reasonableness of the costs sought if the amount of time spent is not broken down in some fashion so that some idea of the manner in which the time was accumulated can be appreciated.

[8] I am also aware that following Boucher v. Public Accountant Council for the Province of Ontario, [2004] 188 O.A.P. 201 (C.A.) and its codification in rule 57.01(1)(0.b), in fixing costs the award should reflect more what the court views as fair and reasonable that should be paid by the unsuccessful party than any exact measure of the actual costs to the successful litigant. This analysis of what the reasonable expectations are necessarily includes, where possible, consideration to other similar types of cases, and the awards that have been made in them, in order that there may be some consistency among awards.

[9] With these considerations in mind, I fix the fees portion of the Trustees costs at $15,000. There is no issue over disbursements of $2,551.30.

[10] St. James shall therefore pay to the Trustee its costs of the motions fixed at $17,551.30 plus GST. This amount is payable within 30 days.

EPSTEIN J.

DATE: February 2, 2006