Cordeiro v. Sebastiao, 2012 ONSC 2291

SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: CV-04-0689-00ES
DATE: 20120508

RE:

Maria Cordeiro (Applicant)

v.

Maria-Almerinda Sebastiao and Carlos Sebastiao (Respondents)

BEFORE: MacKenzie J.
COUNSEL: Esther O. Abraham, for the Applicant
Graham Webb, for the respondent Maria-Almerinda Sebastiao
Milena Celap, for the respondent Carlos Sebastiao

E N D O R S E M E N T RE: COSTS

(Application under sections 22 and 55 of Substitute Decisions Act , 1992, S.O. 1992, c.30)

1By endorsement dated January 4, 2012 I granted the relief set out in paragraphs 35 and 45 of the factum filed by counsel for the respondent Maria-Almerinda Sebastiao. The orders granting such relief arising from that endorsement were entered on or about the 27 th of March, 2012 in the form of a judgment.

2In the endorsement dated January 4, 2012 I directed a return of the application for advice and direction from the court relating to issues that arose from the resulting order, the return date being scheduled for March 7, 2012.

3The judgment dated January 4, 2012 did provide for written submissions by the parties relating to costs as set out in paragraph 12 of such judgment.

4On March 7, 2012 in accordance with the directions in the endorsement, and resulting order both dated January 4, 2012, the parties appeared before me.

5By endorsement of March 7, 2012 I made an order that the respondent Carlos Sebastiao would comply fully with the obligations put upon him pursuant to the endorsement and judgment dated January 4, 2012 on or before March 22, 2012 and a further return date was stipulated for the April 4, 2012 at 10:00 a.m. for a status hearing and any other associated relief. The costs of March 7, 2012 were reserved.

6At the request of the parties, the return date of April 4, 2012 has been post-poned and is now scheduled for return on June 26, 2012.

7In light of the continuing obligations and issues arising in this matter, I will deal only with the costs occasioned up to and including January 4, 2012.

8I shall deal with such costs on the basis of the submissions that were directed on that date, all of which have since been received. For greater certainty, any costs accruing after the appearance on January 4, 2012 including the hearing on March 7, 2012 will be the subject of further submissions in the form required by the court and in the context of the final disposition of the application.

9As noted, I have received the submissions from counsel for the respondent Maria-Almerinda Sebastiao, the mother of the applicant and the respondent Carlos Sebastiao, Mr. G. Webb; Ms. E. Abraham on behalf of the applicant Maria Cordeiro; and Ms. Celap on behalf of the respondent Carlos Sebastiao.

10The gist of the submissions by Mr. Webb are that the costs herein should not be paid from the estate of Maria-Almerinda Sebastiao but rather should be recovered from the respondent Carlos Sebastiao. Counsel relies on two decisions in the Ontario Court of Appeal and the Superior Court of Justice in McDougald Estate v. Gooderham , 2005 21091 (ON CA) and Re Salter Estate , 2009 28403 (ON S.C.) .

11In McDougald Estate , supra, counsel contends that the court has altered the traditional rule in estate litigation that the estate bears the costs of all parties and that the courts in assessing costs in estate litigation matters should follow the rules relating to costs which apply in civil litigation except where the litigation arose as a result of the actions of the testator; those with an interest in the residue of the estate; or where the litigation was reasonably necessary to ensure the proper administration of the estate: see para. 78 and 80.

12The concept was endorsed in Re Salter Estate , supra, wherein Justice D. M. Brown made the following observation:

6... the general costs rules for civil litigation apply equally to estate litigation – the loser pays, subject to a court’s consideration of all relevant factors under Rule 57, and subject to the limited exceptions described in McDougald Estate .

13I regard the dicta in these two decisions as currently setting out the law of Ontario respecting the disposition of costs issues in estate litigation, I have received no authority establishing any ruling contrary to these principles.

14Mr. Webb contends that the subject proceedings were necessitated by the conduct of the respondent Carlos Sebastiao, in particular his failure to fulfill his statutory duties as attorney in fact for property and personal care relating to his mother (the applicant) and that this failure has resulted in the orders for guardianship of property and person pursuant to the Substitute Decisions Act (the Act ). He also notes that the order under the Act reflected in the endorsement and resulting judgment of January 4, 2012 was made on consent of the applicant.

15In these circumstances, Mr. Webb submits that it would be unfair and unjust to burden the estate of Maria-Almerinda Sebastiao with costs of the proceeding on a final basis and that orders should be made to allow the immediate payment of her costs and her counsel from her estate to prevent such sums from remaining unpaid until recovery can be made against the respondent Carlos Sebastiao. He further contends the respondent Carlos Sebastiao should immediately reimburse her estate for the costs of the proceeding with any such costs not being repaid to be charged and deducted from any amounts that would otherwise be owing from the estate to Carlos Sebastiao.

16Mr. Webb, in aid of recouping recovery of her costs against the respondent Carlos Sebastiao, relies on s. 46 of the Legal Aid Services Act which provides as follows:

Costs orders by court unaffected by legal aid services

46. (1) The costs awarded in any order made in favour of an individual who has received legal aid services are recoverable in the same manner and to the same extent as though awarded to an individual who has not received legal aid services.

17Mr. Webb refers to case law interpreting this section as contemplating that costs awarded in any order made in favour of an individual who has received legal aid services are recoverable in the same manner and to the same extent as though awarded to an individual who has not received legal aid services.

18Mr. Webb also refers to case law interpreting this section for the proposition that costs are to be assessed without regard to the fact that a successful litigant receives legal aid and that the party paying such costs pays the same amount he or she would have if the successful party had not received legal aid: see Smith v. Smith 2008 19506 (ON SC) , [2008] O.J. No. 1674; Ramcharitar v. Ramcharitar (2002) 2002 53246 (ON SC) , 62 O.R. (3d) 107 (S.C.J.); and Alverez v. Smith 2008 10047 (ON SC) , [2008] O.J. No. 941 (S.C.J.).

19In his costs outline Mr. Webb seeks a total of $9,253.91, comprising $8,000 for fees, a counsel fee of $1,000 for an estimated five hours, and disbursements of $253.91. In this outline he refers to the factors to be considered in fixing costs under Rule 57.01(1) in respect of which he focuses on the conduct of the respondent Carlos Sebastiao as unnecessarily tending to lengthen the duration of the proceedings by his unresponsiveness to not only requests to discharge undertakings given in cross-examinations and production of documents but also non-compliance with obligations imposed upon him by the court in relation to production of such materials.

20Mr. Webb logs a total of 40 hours at his rate of $200 per hour; he notes that he has more than 26 years of experience having been called to the bar in April 1985.

21Ms. Abraham on behalf of the applicant Maria Cordeiro does not address in her costs outline in express terms whether the recovery should be against the respondent Carlos Sebastiao or against the estate. It would nonetheless appear from her submission relating to the factors in Rule 57.01(1) focusing on the conduct of the respondent Carlos Sebastiao that the applicant seeks to recover any costs award ultimately from Carlos Sebastiao in the same manner as was set out by Mr. Webb on behalf of the respondent Maria-Almerinda Sebastiao.

22The amount of costs sought to be recovered on behalf of the applicant as set out in the costs outline is $32,808.32, comprising of fees and disbursements of $18,289.05 plus fees and H.S.T. totalling $11,865 plus disbursements of $1,454.27.

23The last item is described in the costs outline as “estimated lawyer’s fee for further jobs as ordered on January 4, 2012 by Honourable Justice MacKenzie.” Apart from my observation above that the costs award herein relates to costs up to and including the appearance and order of January 4, 2012, including the costs reserved from the court appearances on May 26, 2011 and June 2, 2011, Ms. Abraham is seeking on behalf of her client payment of anticipated or putative costs in a situation where no one, neither the court nor counsel, can at this time reasonably foresee the nature and extent of the proceedings yet to come and the costs associated with such future proceedings. Accordingly, this head of damages is disallowed at the outset.

24Ms. Abraham notes she has nineteen years of experience and posits an hourly rate of $300.

25The final submission with respect to costs is by Ms. Celap, counsel for the respondent Carlos Sebastiao.

26In her costs submissions, Ms. Celap does not address the question of whether any costs award charged against her client should be paid by him directly or individually, in response to the submissions made by Mr. Webb on behalf of Ms. Maria-Almerinda Sebastiao. She does contend that the costs sought by both the applicant and the respondent Maria-Almerinda Sebastiao should be reduced from the amounts being claimed.

27I deal first with her complaint respecting Mr. Webb’s claimed hourly rate of $200.

28Ms. Celap submits that “at best, he would be billed at the top tier of the Legal Aid Ontario rate of $106.65 and it is submitted that Ms. Sebastiao’s costs should be assessed at this rate.”

29I refer to provisions of s. 46 (1) of the Legal Services Act , above, and the case law thereunder. Her submission that the hourly rate should be fixed $106.65 for Mr. Webb’s services is rejected accordingly.

30In regard to Ms. Abraham’s claimed hourly rate of $300, Ms. Celap contends that the hourly rate should be no greater than the $200 sought by Mr. Webb who has seven years more experience at the bar than Ms. Abraham.

31I do not find the disparity of $100 between the two hourly rates to be determinative or dispositive of the amount of costs to be fixed, it is but one of the factors to be taken into account at the exercise of the court’s discretion under Rule 57.01(1).

32In terms of the conduct of Mr. Sebastiao, Ms. Celap makes the following submission “any question of guardianship over a parent is a highly sensitive and emotional one for the parties. As such, Mr. Sebastiao ought not to be punished unduly for exercising his procedural right to respond to the application or for exhibiting emotion that may have hampered his ability to act in a timely way.”

33There is no evidence before me that Mr. Sebastiao’s conduct in these proceedings to date is attributable to his ability to act being hampered by emotional causes.

34I conclude that he has by his conduct unnecessarily lengthened and aggravated the pace of the proceedings and has been in default in discharging some of his obligations set out in the judgment of January 4, 2012.

35I turn now to the fixing of costs and the disposition for payment of these costs.

36I fix the costs of the respondent Maria-Almerinda Sebastiao $7,500.00, all inclusive.

37I fix the costs of the applicant at $6,500.000, all inclusive.

38These costs shall be paid forthwith to the parties entitled and their counsel out of the estate of the respondent Maria-Almerinda Sebastiao and the respondent Carlos Sebastiao shall reimburse her estate for the above costs payments on or before June 15, 2012, any such costs not being paid by reimbursement to be deducted or stand as a charge against any amount that would otherwise be owing from the estate of Maria-Almerinda Sebastiao to Carlos Sebastiao.

MacKenzie J.

DATE: May 8, 2012

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