COURT FILE AND PARTIES

COURT FILE NO.: 08-1440
DATE: 20120316
SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Christopher Gill, Plaintiff

AND:
Honda of Canada Mfg., A Division of Honda Canada Inc., Defendant

BEFORE: THE HON. MADAM JUSTICE S.E. HEALEY

COUNSEL:
M. Lemieux, Counsel for the Plaintiff/Moving Party

R. Bandhu, Counsel for the Defendant Honda of Canada Mfg., A Division of Honda Canada Inc.

HEARD: March 13, 2012

ENDORSEMENT ON MOTION

[ 1 ] The plaintiff moves for judgment in the terms of an accepted settlement pursuant to Rule 48.09 of the Rules of Civil Procedure , with respect to his wrongful dismissal action (08-1440) and his action for disability benefits (08-1417). These are companion motions seeking identical relief.

[ 2 ] Partial payment of the settlement funds had been received by the plaintiff on March 12, 2012, and the remaining balance of $8,000 was expected to be delivered the day following the motion, which plaintiff’s counsel accepted to be true. He submitted that this motion, and its companion motion in court file no. 08-1417, should be adjourned sine die, to be dismissed at a later date following receipt of the final cheque. The contest today is over the costs of these motions. Both counsel seek costs on behalf of their clients.

[ 3 ] The evidence shows that the parties entered into an agreement in principle on or about December 19, 2011, subject to reaching agreement on how the settlement funds were to be paid and the signing of releases. The figures offered were: $144,988.57 for arrears of LTD benefits, $52,000 for costs and disbursements, and $75,000 for wrongful dismissal. This agreement was reached directly with Honda’s in-house counsel, Ms. Kadykalo, and before Honda and Sun Life’s current litigation counsel was retained (Sun Life retaining Mr. Bandhu’s firm for the disability benefits action). Ms. Kadykalo noted in her e-mail correspondence that she would need the assistance of outside counsel to prepare the releases. The amount of the settlement was confirmed in writing by plaintiff's counsel in correspondence dated December 29, 2011, at which time he enclosed draft Minutes of Settlement. His covering letter noted that the Minutes “make accommodation for the $75,000 in bad faith to be characterized as you required”. The draft minutes provided by plaintiff's counsel broke down the sum of $75,000 as follows: $15,000 for general damages; $50,000 for future care costs; $5,000 for notice and severance net of LTD arrears; $5,000 for prejudgment interest.

[ 4 ] The defendant’s present counsel was retained on January 3, 2012. Mr. Bandhu had to coordinate his discussions with counsel for Honda and Sun Life. It was Mr. Bandhu’s position that the delay was caused in part by the fact that plaintiff's counsel and Ms. Kadyakalo were not ad idem with respect to their discussions over the characterization of the $75,000.

[ 5 ] On February 16 defendant’s counsel delivered Minutes of Settlement. Covering e-mail correspondence to these Minutes requested that plaintiff’s counsel do the following: provide his firm’s undertaking with respect to costs and disbursements as required by the Minutes; provide the plaintiff's written direction with respect to payment of the settlement funds; provide confirmation that there are no third party rights of recovery that may be affected by the settlement; hold any cheques delivered to the plaintiff's firm in escrow pending the return of executed documents, and written confirmation from the plaintiff's physician that he was competent to enter into the Minutes of Settlement.

[ 6 ] On February 16 and 17 there was an exchange of e-mail correspondence between counsel which was ultimately resolved with plaintiff’s counsel confirming that the amounts set out in the Minutes of Settlement as drafted by defendant’s counsel were agreeable.

[ 7 ] On February 23 defendant’s counsel reminded plaintiff’s counsel of the outstanding requirement for delivery of the settlement cheques. In his response plaintiff’s counsel stated that he had just noted the requirement with respect to providing an undertaking to hold the cheques in escrow pending the plaintiff's provision of a medical note. This issue created more back-and-forth between counsel, the resolution of which was delayed by the fact that Ms. Kadykalo was out of the office until March 5.

[ 8 ] On February 24 plaintiff's counsel delivered signed Minutes of Settlement, a signed release, an irrevocable direction and signed consents, but not the solicitor’s undertaking with respect to fees as required by paragraph 7 of the Minutes. This undertaking was framed as follows:

The parties acknowledge that the payments by HCM and Sun Life in respect of legal fees and disbursements is conditional upon the receipt by the solicitors for HCM and Sun Life of a written undertaking from Littlejohn Barristers Professional Corporation indicating that Mr. Gill will not be rendered an account for legal fees and disbursements, in respect of both actions, which is less than $52,000.

[ 9 ] On February 27 executed copies of the Minutes of Settlement were received by defendant’s counsel. Plaintiff’s counsel indicated on that date that all settlement funds were to be in the plaintiff’s hands by March 2, 2012, failing which he had instructions to bring this motion. The next day defendant’s counsel sent plaintiff’s counsel correspondence reminding him that he was waiting for information from the plaintiff's psychologist. The position of defendant’s counsel at that time was that if the plaintiff's psychologist could not provide the requested clearance and if the plaintiff otherwise refused to provide a medical note certifying his competence, defendant’s counsel would seek revised instructions from Honda after Ms. Kadykalo’s return on March 5.

[ 10 ] On March 1 plaintiff’s counsel indicated that he had instructions to bring a motion to enforce settlement, noting that motion materials would be delivered that evening. The e-mail sent by plaintiff's counsel stated that "hopefully all funds will have been received by that time (the return date for the motion) and the motions will not be necessary”. Plaintiff’s counsel also noted that because the Minutes of Settlement imposed no requirement on the plaintiff to prove capacity for the purpose of settlement, no steps would be taken in that regard. This is contrary to his earlier position, which was that he would contact the plaintiff’s psychologist to determine if an opinion on capacity could be provided.

[ 11 ] Defendant’s counsel obtained instructions from Ms. Kadykalo on the date of her return and advised plaintiff’s counsel that Honda was waiving the requirement with respect to the provision of a medical certificate. Honda's portion of the settlement proceeds were delivered by overnight courier to plaintiff’s counsel on the same date.

[ 12 ] On March 8 plaintiff's counsel delivered motion confirmation forms indicating that the motions were to be argued. Upon receipt of the motion confirmation, defendant’s counsel advised that he expected to be in receipt of all of the cheques from Sun Life by the end of the week. He indicated that he would be delivering one by overnight courier that day and another the next day. He was expecting delivery of the third cheque on March 12.

[ 13 ] On March 9 defendant’s counsel couriered two cheques from Sun Life totalling $212,806.08. At that point, and as of the date of the argument of this motion, there was only one remaining cheque to be delivered from Sun life of approximately $8,000.

[ 14 ] In an attempt at settlement the defendant’s counsel offered $750 in costs, which included the cost of similar motions (Emes v. Honda, Emes v. Sun Life Assurance Company of Canada et al., court file nos. 08-1440 and 08-1417). Plaintiff’s counsel demanded $3,500 for this file alone. The position advanced by plaintiff's counsel at the hearing was that the plaintiff was seeking $2,000. As no agreement had been reached by the Friday before this motion was to be argued, defendant’s counsel was required to prepare responding material over the weekend.

[ 15 ] The defendant’s counsel submits that this motion was unnecessary and precipitous, particularly given that there was no date by which payment was to be made in the Minutes of Settlement. Defendant’s counsel seeks costs of preparation of responding material and his attendance in the amount of $3,600.

[ 16 ] Plaintiff's counsel argues that the lengthy delay between December 19, 2011 and the date of delivery of approved Minutes of Settlement (February 16) is an unconsciously lengthy period of delay, and that the additional 22 days for delivery of substantial payment is likewise egregious. He argued that it was necessary to prepare motion material on March 1 in order to compel payment of the unpaid amounts from Sun Life.

[ 17 ] Weighing all of the above evidence and arguments, this court finds that this motion was precipitous. Plaintiff’s counsel threatened and persevered in preparing such material even knowing that there was an outstanding issue regarding plaintiff’s capacity that had to await Ms. Kadykalo’s return on March 5. Even if this condition may have been an unusual one for the defendant to request satisfaction of, plaintiff’s counsel initially acquiesced to attempt to meet the condition. Further, plaintiff’s counsel did not request information from defendant’s counsel as to when Sun Life's portion of the funds would be made available prior to drafting its materials. Given that plaintiff’s counsel had only satisfied his own obligations on February 27, receiving payment in full under the Minutes of Settlement only 9 business days later is a reasonable timeline, particularly given that there was no deadline for payment imposed by the Minutes. There is no evidence that the solicitor’s undertaking as required by paragraph 7 of the Minutes was ever satisfied.

[ 18 ] The plaintiff cannot rely on the delay between settlement and production of the Minutes of Settlement by defendant’s counsel to justify this motion. Such delay, if it prejudiced the client, could have been addressed by a revision of the settlement amount or through prejudgment interest. Impatience over such delay also ignores the reality of the intervening holiday period, and the fact that defendant’s counsel was communicating with and receiving instructions from two separate clients with respect to the Minutes.

[ 19 ] Finally, even after plaintiff’s counsel had prepared the motion, the defendant’s counsel made a reasonable offer that could have compensated plaintiff’s counsel for most if not all of his time and disbursements expended. The amount sought by plaintiff’s counsel of $3,500 strongly suggests that he was attempting to collect post-judgment interest on the settlement amounts; costs are not the appropriate way to address such an issue.

[ 20 ] In the result I conclude the defendant’s counsel was unnecessarily put to the expense of responding to this motion. Having reviewed the defendant’s costs outline, this court orders that the defendant shall have its costs payable by the plaintiff fixed in the amount of $2,800 inclusive on a partial indemnity basis and payable in 30 days.

[ 21 ] The motion is dismissed with costs as ordered above.

HEALEY J.

Date: March 16, 2012