Court File No.143/06
20070913
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
BETWEEN:
ASSOCIATION OF PROFESSIONAL ENGINEERS OF ONTARIO and
BERNARD ENNIS, P.Eng.
Applicants
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HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO as represented by THE MINISTER OF MUNICIPAL AFFAIRS AND HOUSING and DAVID BREZER, P.Eng. in his capacity as DIRECTOR OF THE BUILDING AND DEVELOPMENT BRANCH OF THE MINISTRY OF MUNICIPAL AFFAIRS AND HOUSING and in his capacity as a CHIEF BUILDING OFFICIAL
Respondents
HEARD: Submissions as to Costs in writing: June 15 –26, 2007
BEFORE: Lane, Chapnik and P. Smith JJ.
COUNSEL: Richard Steinecke and Lisa Braverman, for the applicants
Dennis W. Brown Q.C., for the respondents
David C. Moore for the Ontario Association of Architects, Intervenor
E N D O R S E M E N T A S T O C O S T S
LANE J.:
[1] On May 17, 2007, we released reasons in this application declaring that certain provisions of the Building Code Act, 1992 and of the Building Code Regulation conflicted with the statutory exclusive regulatory jurisdiction of the applicant Association (PEO) and so did not apply to the licence holders of the PEO. We have now received the costs submissions of the parties.
[2] The Intervenor does not seek costs, nor are any sought from it.
[3] The applicants seek substantial indemnity costs from the respondent of some $116,000. The basis for seeking substantial indemnity costs is that the applicants see themselves as a public interest litigant analogous to the successful applicants in Algonquin Wildlands League[^1] who were awarded substantial indemnity costs when they succeeded in their challenge to forest management plans approved by the Minister in violation of applicable forest management and environmental protection legislation. They submit in their costs submissions:
Similarly, in this case, the applicant PEO is a public interest organization on the basis of subsection 2(3) of the Professional Engineers Act which indicates that the principal object of the Association is to regulate the practice of professional engineering and to govern its members ...[and licence holders] in accordance with the Act, the regulations and the by-laws in order that the public interest may be served and protected.
-and-
The applicants’ regulatory activities are funded almost entirely from the fees charged its members. The government does not fund PEO.
[4] The applicants also support their claim for substantial indemnity costs by reference to the late delivery of the respondent’s factum and to certain amendments made to the Building Code while the litigation was pending. Both matters have been explained by the respondent and I do not see any basis for awarding substantial indemnity costs in connection with them.
[5] As to the public interest litigant point, the respondents submit that the PEO is not a public interest litigant because it derived a financial or economic benefit from the proceedings. Financial considerations were referred to in the supporting material of PEO, including increased insurance costs and direct and indirect costs associated with obtaining accreditation under the amended Code. The respondent referred us to Reese[^2] where the court said that a public interest group had no personal, proprietary or pecuniary interest in the outcome of the proceedings, but takes action to affect a public policy in respect of matters in which the group is interested. So defined, the respondent submitted that there was no basis for considering the PEO a public interest organization.
[6] In my view, the Reese definition excellently describes some public interest litigants but is not entirely inclusive. It does not include organizations like the PEO which have a legislative mandate to regulate a profession in the public interest and which are required to litigate in the course of that mandate. The present case resembles the situation described by Osler J. in Centenary Hospital[^3]
Counsel attended this day to speak to the matter of costs. In effect, the applicant was the victim of a difference of opinion between two ministries, an inconsistency in legislation, or a reluctance of a government ministry to take responsibility for interpreting its own legislation. On any of these grounds the applicant was virtually compelled to bring the application, which raised matters of great importance to itself and of considerable importance to other hospitals and the public at large. Its view has prevailed and it is entitled for the above reasons, and because costs should usually follow in the event, to have its costs. Because the hospital was really the victim of governmental indecision, its expenses should be entirely recovered to the extent that is possible and it will have its costs on a solicitor-client basis.
[7] In the present case, it must have been apparent to those in charge of the Building Code that their new legislation directly challenged the authority conferred by the Legislature on the PEO to regulate and certify the qualifications of professional engineers. Their persistence in pursuit of their program virtually compelled the PEO to respond. The matter was of great importance to the PEO and its members, as well as to the Intervenor and its members. It was not just the obligation to re-prove qualifications that was the problem. The statutory division of work between the two professions was achieved with some difficulty over a number of years and the emergence of a third party claiming the right to involve itself was sure to trigger serious concern.
[8] For these reasons, I would award the applicant substantial indemnity costs.
[9] As to the amount, I am of the view that what is claimed is beyond the amount that ought to be awarded. We do not assess costs; we fix them. I will refrain from detailed exegesis on the Bill. I have no doubt the time was spent and the rates are reasonable taken by themselves. But the key question is this: At the end of the day, is the total for fees and disbursements a fair and reasonable amount to be paid by the unsuccessful parties in the particular circumstances of this case?[^4] This is the major guiding principle in the fixing of costs, as reiterated by Borins J.A. for the Court of Appeal in Moon[^5] where he observed that the case law established that such an award must:
…reflect “more what the court views as a fair and reasonable amount that should be paid by the unsuccessful parties rather than any exact measure of the actual costs to the successful litigant”. This is a fundamental concept in fixing or assessing costs.
[10] Borins J.A. went on to observe that such an amount is not arrived at arithmetically, but by determining what is fair and predictable. The paying party must not be faced with an award that does not reasonably reflect the amount of time and effort that was warranted by the proceedings.
[11] There is no “tariff” in this court, but the normal run of costs for two days would not approach $116,000 and a litigant would not reasonably expect to face such a bill. The applicant’s claim is well beyond what could be predicted based on the general level of past awards in this court. While this was an important case, it was not an unusually complex case for the Divisional Court. In any event, as a substantial indemnity costs award, it will inevitably exceed the usual norms. All things considered, I think that $75,000 inclusive of disbursements and GST is a fair and reasonable award on a substantial indemnity costs basis.
[12] The applicant will have costs in the amount of $75,000 payable forthwith by the respondent Ministry.
Lane J.
Chapnik J.
P. Smith J.
DATE:
[^1]: Algonquin Wildlands League v Ontario (Minister of Natural Resources) (1998), 27 C.E.L.R. (N.S.) 218 (Div. Ct.); 1998 5756 (ON CA), [1998] O.J. No. 4331 (C.A.)
[^2]: Reese v Alberta (1992), 1992 2825 (AB KB), 13 C.P.C. (3d) 323 (Alta. Q.B.)
[^3]: Centenary Hospital Association and Public Trustee (1989), 69 O.R. (2d) 447 at 448.
[^4]: See Murano v. Bank of Montreal (1998), 1998 5633 (ON CA), 41 O.R. (3rd) 222, at page 247; and Zesta Engineering Ltd. v. Cloutier, Ont. C.A. Nov. 27, 2002.
[^5]: Moon v. Sher (2004), 2004 39005 (ON CA), 246 D.L.R. (4th) 440, at para. 30 (Ont. C.A.)