ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 06-CV-035351SR
DATE: 20120516
BETWEEN:
KEVIN MOBERG
Respondent/Plaintiff
– and –
PETER PATAFIE
Appellant/Defendant
Alan Riddell, for the Respondent/Plaintiff
Pat Peloso/Sawn Searle, for the Appellant/Defendant
HEARD: by Written Submissions
DECISION ON APPEAL REGARDING COSTS
TOSCANO ROCCAMO J.
[1] On February 1, 2012, I issued Reasons in relation to an appeal from the Decisions and Certificate of Assessment of the Regional Hearings Officer L. Bender, dated May 20, 2011 and September 16, 2011, which awarded the Respondent/Plaintiff $72,000 in costs inclusive of disbursements and exclusive of GST for an action commenced under the Simplified Rules, and $20,000 for costs of the assessment itself, inclusive of applicable taxes and disbursements.
[2] The appeal raised issues with respect to the application of the principle of proportionality as well as the notion of “the reasonable expectations of the losing party” in an assessment of costs under the Simplified Rules.
[3] The dismissal of the appeal turned on application of the standard of review which requires that considerable deference be given to the decision of an assessment officer. In addition, I found that the decision of the assessment officer was well supported by the unique factors at play, including the following:
Despite the modest claim for past loss of income arising from the action in defamation, Ms. Bender found that without an apology and public retraction to restore the Plaintiff’s reputation, the amount at stake in the proceedings was future commissioned sales of approximately $500,000. Therefore, her award of costs for the action was reasonably proportionate to a civil law suit of this complexity and potential dollar value.
Ms. Bender’s decision pointedly addressed factors in r. 58.06(1) and in particular, the conduct of the Defendant which served to increase the Plaintiff’s costs, both for the action and the protracted hearing related to the assessment of costs itself.
[4] I saw no reason to find any error in principle in the reasoning of the assessment officer; nor could I consider the awards she made for costs of the action and the assessment hearing so grossly large or small as to be beyond question improper.
[5] The appeal before me took less than a morning to hear.
[6] I formed the impression that the materials filed on behalf of the Respondent/Plaintiff were largely reconstituted excerpts of materials filed with the Regional Hearings Officer supplemented by case law pertaining to the standard of review and application of the key principles in the award of costs for actions commenced under the Simplified Rules procedure.
[7] In my opinion, the appeal was straightforward, and not complex.
[8] In my analysis of the applicable case law, I made specific mention of the reasoning of the Divisional Court in Culligan Springs Ltd. v. Dunlop Lift Truck (1994) Inc. (2006), 2006 13419 (ON SCDC), 211 OAC 65 (“Culligan”) where the Court pronounced that an Offer to Settle under r. 49 is an important factor, but not determinative in the fixing of costs in cases decided under the Simplified Procedure. In such cases, costs should be fixed with reference to the factors in r. 57.01(1) and with reference to the objective of the Simplified Procedure of promoting affordable access to justice.
[9] The Respondent/Plaintiff seeks costs in the amount of $29,334.94 for this appeal. The Respondent/Plaintiff delivered a Costs Outline on December 15, 2011, the day after the original hearing date was adjourned by McMunagle J. so as to be heard by a civil judicial specialist with costs of the day to be decided by the motions judge. That Costs Outline sought partial indemnity costs to October 14, the date on which an Offer to Settle was served offering to accept the sum of $95,000 inclusive of pre-judgment interest and costs if accepted on or before October 18, 2011, and substantial indemnity costs if accepted after that date. The Offer, if it includes applicable taxes, would represent a mere discount of $1625, an offer which in my opinion offered no incentive for resolution of a matter both counsel indicated engaged somewhat novel application of the principle of proportionality as well as the “reasonable expectations of the losing party” in a Simplified Rules action.
[10] It is important to note that the Respondent/Plaintiff sought partial indemnity fees to the date of the Offer, and substantial indemnity fees from the date of the Offer to December 14, 2011 in the total amount of $11,074.09. In my opinion, additional fees subsequent to that date in the approximate amount of $18,000 could not reasonably be proportionate in response to the Appeal Record and Supplementary Records filed by the Appellant/Defendant.
[11] While I have given due regard to the submissions made by the Respondent/Plaintiff in support of costs pursuant to r. 57.01(1), I am unable to conclude that the amount in issue, the nature of the proceedings, or any conduct on the part of the Defendant would temper any application of the principle of proportionality. To do so, would, in my opinion, amount to a serious departure from the reasoning employed by Culligan in relation to the principle of proportionality.
[12] In addition to the principle of proportionality, I must also give voice to the reasonable expectation of the losing party in this matter. As I indicated at para. 38, 39, and 40 of my Decision on Appeal, in Culligan, the Court made reference to the trilogy of cases in the Court of Appeal which emphasized that an “overriding principle of reasonableness must govern the judicial exercise of awarding costs.” See: Boucher v. Public Accountants Counsel for the Province of Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291 (C.A.)(“Boucher”); Moon v. Cher (2004), 2004 39005 (ON CA), 246 D.L.R. (4th) 440 (C.A.)(“Moon”); and Coldmatic Refrigeration of Canada Ltd. v. Leveltek Processing LLC (2005), 2005 1042 (ON CA), 75 O.R. (3d) 638 (C.A.) at para. 37.
[13] In Culligan, the Court specifically discouraged the rigid application of grids or formulas in the exercise of a court’s discretion in the award of costs that are “fair and reasonable” in all of the circumstances of the case. The Costs Outline of the Appellant/Defendant seeks partial indemnity costs including counsel fee for attendance on the appeal of $6,247.67, substantial indemnity costs of $7,913.51, and full indemnity costs of $8,746.44, inclusive of all disbursements.
[14] The Appellant/Defendant served an Offer to Settle costs on this appeal at $10,000 plus disbursements. In my opinion, the Offer was eminently reasonable having regard to the reasonable expectations of the losing party who bore the onus on this appeal.
[15] In the result, I fix costs on this appeal at $10,000 plus disbursements, plus applicable taxes payable by the Appellant/Defendant to the Respondent/Plaintiff within 30 days.
Madam Justice Toscano Roccamo
Released: May 16, 2012
COURT FILE NO.: 06-CV-035351SR
DATE: May 16, 2012
ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN: KEVIN MOBERG Respondent/Plaintiff – and – PETER PATAFIE Appellant/Defendant
decision ON APPEAL REGARDING COSTS
Madam Justice Toscano Roccamo
Released: May 16, 2012