On Ice Express Inc. v. On Ice (Canada) Inc. et al., 2012 ONSC 2798

COURT FILE NO.: 05-CL-5897

DATE: 20120615

SUPERIOR COURT OF JUSTICE – ONTARIO

(COMMERCIAL LIST)

RE: ON ICE EXPRESS INC., Plaintiff

AND:

ON ICE (CANADA) INC. AND MARITIME-ONTARIO FREIGHT LINES LIMITED, Defendants

BEFORE: MORAWETZ J.

COUNSEL: Steven M. Bookman and Chris Stankiewicz, for the Plaintiff

Michael J. W. Round, for the Defendants

COSTS ENDORSEMENT

[ 1 ] This costs endorsement relates to two motions.

[ 2 ] Argument was heard for one day, after which time the parties resolved both matters subject to the issue of costs.

[ 3 ] The first motion was for security for costs. The defendants brought the motion seeking $292,277 as security for costs from the plaintiff. The parties settled the security for costs motion and the plaintiff agreed to pay $162,500 as security for costs.

[ 4 ] The second motion was brought by the plaintiff seeking an order transferring the interest held by the plaintiff to a new corporation, together with an order to continue. Prior to the hearing of the motion, the plaintiff obtained an ex parte order to continue from the Registrar. The defendants took the position that the plaintiff’s conduct could properly be considered an abuse of process. However, at the end of the day, the ex parte order was not challenged.

[ 5 ] The defendants take the position that, given the terms of the settlement, they have been entirely successful with their motion for security for costs and, as such, are entitled to the costs of that motion on a partial-indemnity basis. Further, by obtaining an ex parte order to continue on the day before the hearing of its cross-motion, the plaintiff, in effect, abandoned its cross-motion. As a result, the defendants submit they should be entitled to their costs in responding to the cross-motion on a partial-indemnity basis as contemplated pursuant to rule 37.09 (3).

[ 6 ] The defendants seek costs in the amount of $66,409.04 inclusive of fees, disbursements and taxes, for combined costs in respect of both motions.

[ 7 ] The plaintiff takes the position that each party should bear their own costs on the basis that the defendants were only partially successful as they obtained approximately one-half the amount of security for costs they sought in their notice of motion. With respect to the order to continue, the plaintiff takes the position that it followed the procedural requirements for obtaining an order to continue and it would have been a misuse of resources of the court and of the parties to make lengthy submissions in respect of an order that the rules stipulate should be issued by the Registrar without notice.

[ 8 ] The plaintiff also points out that its own costs outline reflects an amount of $30,785.32 and, by comparison, the costs sought by the defendants are excessive.

[ 9 ] I have considered the submissions filed by the parties and I have also taken into account the facts enumerated under Rule 57, including the time spent, the results achieved and the complexity of the matter. In addition, I have also taken into account the principles set forth by the Court of Appeal in Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 14579 (ON CA) , 71 O.R. (3rd) 291 (C.A.), specifically that the overall objective of fixing costs is to fix an amount that is fair and reasonable for an unsuccessful party to pay in the particular circumstances, rather than an amount fixed by actual costs incurred by the successful litigant.

[ 10 ] In my view, the defendants achieved considerable success on the motion for security for costs. However, it must be recognized that the amount actually agreed to by way of settlement was far less than what was requested. Accordingly, I have determined that costs should be awarded on a partial-indemnity basis, but significantly reduced from the amount requested, to reflect the partial success.

[ 11 ] I think it is also appropriate to take into account that the motion for security for costs was relatively straight forward. I note that three senior personnel docketed significant time to the file. When three senior personnel are involved, it is inevitable that a degree of duplication arises. Accordingly, it is my view that the amount requested must be further reduced to reflect such duplication.

[ 12 ] With respect to the order to continue, I am at a loss to understand how this motion proceeded to the extent that it did. It appears that both sides spent considerable resources on this aspect of the proceeding that was, in my view, not necessary. Each party shall bear its own costs in respect of this motion.

[ 13 ] In the result, costs are awarded in favour of the defendants in the amount of $18,000, inclusive of fees, disbursements and taxes.

[ 14 ] In my view, this amount is fair and reasonable for the plaintiff to pay in the particular proceeding. The costs are to be paid within 30 days.

MORAWETZ J.

Date: June 15, 2012