Doucette v. Espial Group Inc., 2020 ONSC 775
CITATION: Doucette v. Espial Group Inc., 2020 ONSC 775
COURT FILE NO.: DV-19-2502
DATE: 2020/02/07
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Between: Christopher Doucette, Plaintiff (Respondent/Appeal)
AND
Espial Group Inc., Defendant (Appellant/Appeal)
BEFORE: Justice A. Doyle
COUNSEL: Chantal Beaupre and Michael Babe, Counsel for the Respondent
Justin Dubois, Counsel for the Appellant
DATE: In Writing
Costs DECision
Overview
[1] On December 16, 2019, the Court dismissed an appeal of Espial Group Inc. (“Espial”) from a decision of Deputy Judge R. Conway of the Small Claims Court dated May 21, 2019 in which she found that the termination clause in the Christopher Doucette’s employment agreement was unenforceable and awarded him damages in the amount of $25,000.00.
[2] If the parties were unable to agree on the issue of costs, they were to provide the Court with written submissions.
[3] After reviewing the submissions, offers to settle and the Bill of Costs, the Court awards the amount of $5,000.00 to Mr. Doucette for the cost of the appeal and $3,750.00 for the costs at the Small Claims Court trial.
Mr. Doucette’s Position
[4] Mr. Doucette submits that, as the successful party, he should be awarded costs, on a substantial indemnity basis, in the amount of $16,450.25 (inclusive of HST and disbursements).
[5] He submits that the issues were complex, and Espial’s materials required a detailed and nuanced treatment of the law and an in-depth analysis of the recent Court of Appeal and Divisional Court cases dealing with the interpretation and enforceability provisions.
[6] The amount involved was significant to Mr. Doucette.
[7] Mr. Doucette offered to settle the appeal by a payment in the amount of $22,500.00 in damages plus $3,500.00 for costs in the Court below and $4,500.00 for costs of the appeal. This offer was not accepted. Espial did not make an offer to settle the appeal.
Espial’s Position
[8] Espial submits that Mr. Doucette should receive costs in the range of $5,000.00 to $7,500.00 for the following reasons:
- An award of costs on a substantial indemnity basis is unwarranted as Espial did not conduct itself in a reprehensible, scandalous or outrageous manner;
- The issues were not complex and were similar to what was argued at the Small Claims Court level;
- The same body of case law was used at the trial and appellate levels;
- The facts were not complicated, and the parties agreed on a statement of facts at the trial; and
- As the claim was for $25,000.00, an unsuccessful party would reasonably expect that costs would reflect the amount claimed.
[9] Mr. Doucette’s offer made less than 48 hours prior to the appeal requested $4,500.00 in costs. His current request for costs of over $16,000.00 exceed what Espial would reasonably expect to pay.
[10] Espial submits that the costs at the Small Claims Court level should be $3,750.00 which is 15% of the damage award which is the maximum amount provided by s. 29 of the Courts of Justice Act, R.S.O. 1990, c. C. 43, (“Courts of Justice Act”) unless the Court orders otherwise.
Legal Principles
[11] The costs of a proceeding are in the discretion of the Court (s. 131(1) Courts of Justice Act). That discretion must be exercised on a principled basis (Davies v. Clarington Municipality, 2009 ONCA 722, 100 O.R. (3d) 66, at para. 40). Fixing costs is not merely a mechanical exercise; the amount awarded should, considering all the circumstances, be fair and reasonable (Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291 (C.A.)). In a proper case, costs may be awarded against a successful party (r. 57.01 (2) of the Rules of Civil Procedures, R.R.O. 1990, Reg. 194, (“Rules”)).
[12] As stated in Boucher, the Court must be fair and reasonable when exercising its discretion to award costs and the parties’ expectation concerning the amount of a costs award is a relevant factor to be considered.
[13] Rule 57.01(1) of the Rules contains a non-exhaustive checklist of factors that guide the Court in its reasoning when awarding costs in the exercise of its discretion under s. 131 of the Courts of Justice Act.
Analysis
[14] Mr. Doucette was successful and hence is presumptively entitled to costs.
[15] In determining the quantum of costs, the Court considers the factors set out in the Rules and is mindful of proportionality of costs considering the amount of the claim of $25,000 which is the maximum limit of the Small Claims Court at the time of the trial.
[16] In their offer on the eve of the appeal, as stated above, he was prepared to resolve the appeal upon a payment of costs in the amount of $4,500.00.
[17] I agree that the legal issues argued at the appeal were the same as at the trial. This Court dealt with the same issues as to whether the termination clause was unenforceable as it provided Mr. Doucette less notice than that provided in the Employment Standards Act, 2000, S.O. 2000, c. 41, (“ESA”) and/or whether it was ambiguous and not sufficiently clear to oust the common law rights of Mr. Doucette; and lacked a reference to severance pay and employee benefits. In addition, another issue at appeal was whether the trial Judge erred by concluding that Mr. Doucette was entitled to $25,000.00 in damages in lieu of notice.
[18] The appeal did also raise the issue of sufficiency of reasons and whether the law had been properly applied.
[19] This Application was not complex, and the materials were not significant. The issues were important but the facts, issues, and the law were not complex;
[20] The hourly rates are reasonable. There is no justification for costs to be awarded on a substantial indemnity basis.
[21] Therefore, the Court finds that a fair, proportional and reasonable amount to be paid for the appeal by Espial to Mr. Doucette is the reduced partial indemnity fee of $5,000.00.
[22] With respect to the costs at the Small Claims Court level, I find that the maximum amount of 15% of the damage award i.e. $3,750.00 is appropriate in accordance with s. 29 of the Courts of Justice Act. It is not necessary to increase the amount as the Court does not find unreasonable behavior on the part of Espial. In addition, according to r. 14.07 of the Rules of the Small Claims Court, O. Reg. 258/98, there is no offer that qualifies under that rule.
[23] Accordingly, Mr. Doucette is entitled to costs in the amount of $5,000.00 (inclusive of HST) for the appeal and $3,750.00 (inclusive of HST) for the costs of the trial.
Justice A. Doyle
Date: February 7, 2020
CITATION: Doucette v. Espial Group Inc., 2020 ONSC 775
COURT FILE NO.: DV-19-2502
DATE: 2020/02/07
ONTARIO
SUPERIOR COURT OF JUSTICE
RE: Christopher Doucette, Plaintiff (Respondent/Appeal)
AND
Espial Group Inc., Defendant (Appellant/Appeal)
BEFORE: Justice A. Doyle
COUNSEL: Chantal Beaupre and Michael Babe, Counsel, for the Respondent
Justin Dubois, Counsel for the Appellant
COSTS Decision
Justice A. Doyle
Date: February 07, 2020