SUPERIOR COURT OF JUSTICE – ONTARIO
COURT FILE NO.: 07-32228 (Hamilton)
DATE: 2012/05/14
RE: Thomas C. Dodd and Christine Dodd (Plaintiffs) v. Prime Restaurants of Canada Inc. (Defendant)
BEFORE: The Honourable Mr. Justice R.A. Lococo
COUNSEL:
James A. Scarfone and Lauren Grimaldi, for the Plaintiffs
Daniel S. Murdoch and Sarah Clarke, for the Defendant
HEARD: By written submissions
E N D O R S E M E N T – C O S T S
[ 1 ] Prime Restaurants of Canada Inc. is the defendant in an action brought by Thomas Dodd and Christine Dodd, who operated an East Side Mario’s restaurant as franchisees of Prime. Prime was unsuccessful in its motion for summary judgment to dismiss the action in its entirety, or alternatively, for partial summary judgment to dismiss the Dodds’ claim for rescission of the franchise agreement. However, Prime was successful in its request to strike the jury notice. Costs were left to be determined based on written submissions. [^1]
[ 2 ] The Dodds’ position was that the standard rules applicable to interlocutory proceedings should apply in this case, that is, the Dodds as the successful parties should be entitled to their costs, [^2] which should be payable forthwith. [^3] The Dodds argued that costs should be awarded on a substantial indemnity basis on the grounds that it was unreasonable for Prime to bring a motion for summary judgment that had virtually no chance of success. [^4] The Dodds provided a bill of costs indicating substantial indemnity costs of $91,258 or alternatively, partial indemnity costs of $61,826, in each case including disbursements of $2,617.
[ 3 ] Prime’s position was that costs of the motion should be reserved to the trial judge as costs in the cause, or alternatively, should be restricted to “non-recoverable costs” incurred preparing for and attending the hearing. The basis for this position was that the motion was reasonably brought, and the costs incurred by both parties would have been incurred preparing for trial if the motion had not been brought. According to Prime, to grant costs to the Dodds for the time spent preparing for this motion would lead to a windfall to them if Prime is ultimately successful.
[ 4 ] As should be evident from my reasons on the motion, I do not consider it unreasonable for Prime to have brought its motion for summary judgment or partial summary judgment. In my view, the positions taken in support of this motion merit careful consideration by the trial judge.
[ 5 ] I disagree, however, with Prime’s position that because its motion was reasonably brought it should avoid being ordered to pay all or substantially all of the costs of this motion.
[ 6 ] In my view, the appropriate result in this case is for Prime to be responsible for the Dodds’ costs of the motion on a partial indemnity basis, payable within 30 days. This result is consistent with paragraph 20.06 (a) of the Rules of Civil Procedure , which indicates that substantial indemnity costs should be the consequences of unreasonably making a summary judgment motion. That provision does not, however, disturb the presumptive result of partial indemnity costs if the motion is unsuccessful, even if reasonably brought.
[ 7 ] As well, I see no justification for departing from the usual result for a contested motion that the unsuccessful party should pay the successful party’s costs within 30 days.
[ 8 ] In any case, I am not satisfied that the time spent by the parties preparing for and arguing this motion has to any significant extent shortened the time that will be required to prepare for and conduct the trial of this action. As noted by Prime’s counsel, at the time the motion was brought, discoveries were complete and the matter was essentially ready for trial. Granted, certain of the evidence relied on by the Dodds on the motion was from cross-examinations on affidavits filed on the motion, rather than from examinations for discovery. Nevertheless, I agree with Prime that it will be necessary to duplicate much of the preparatory work, and that the costs to both parties will be significant.
[ 9 ] In reviewing the plaintiffs’ bill of costs, I have found the amounts claimed to be generally reasonable for a motion argued over two days and requiring preparation of extensive motion materials and cross-examinations on affidavits. However, I agree with Prime that it would be appropriate to limit costs recoverable for preparation of the factum and other motion material, where there appears to be some duplication of effort by the lawyers involved. I also agree that a modest adjustment should be made in Prime’s favour given its success in having the jury notice struck, which was resisted by the Dodds.
[ 10 ] Taking into account these and other relevant factors, [^5] including the amount that an unsuccessful party would reasonably expect to pay in these circumstances, the plaintiffs’ costs of the motion are fixed at $50,000, inclusive of disbursements and tax, payable by the defendant within 30 days.
The Honourable Mr. Justice R.A. Lococo
DATE: May 14, 2012
COURT FILE NO.: 07-32228 (Hamilton)
DATE: 2012/05/14
SUPERIOR COURT OF JUSTICE - ONTARIO RE: Thomas C. Dodd and Christine Dodd (Plaintiffs) v. Prime Restaurants of Canada Inc. (Defendant) BEFORE: The Honourable Mr. Justice R.A. Lococo COUNSEL: James A. Scarfone and Lauren Grimaldi, for the Plaintiffs Daniel S. Murdoch and Sarah Clarke, for the Defendant ENDORSEMENT – COSTS Lococo J.
DATE: May 14, 2012
[^1]: Dodd v. Prime Restaurants of Canada Inc. , 2012 ONSC 1578 .
[^2]: Bell Canada v Olympia & York Developments Ltd , 1994 239 (ON CA) , [1994] O.J. No. 343 (C.A.) at para. 21 .
[^3]: Axton v. Kent , 1991 7196 (ON SC) , [1991] O.J. No. 523 (Div. Ct.) at para. 8 . See also paragraph 57.03(1) (a) of the Rules of Civil Procedure , R.R.O. 1990, Reg. 194, which directs that costs of a contested motion are to be fixed and to be payable within 30 days unless the court is satisfied that a different order would be more just.
[^4]: See paragraph 20.06(a) of the Rules of Civil Procedure .
[^5]: See subrule 57.01(1) of the Rules of Civil Procedure .