ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 98-3810
DATE: 2012-05-29
B E T W E E N:
DANIEL STRANGES
David F. Smye and James Cavanaugh , Counsel for the Plaintiff
Plaintiff
- and -
ALLSTATE INSURANCE
Ian D. Kirby , Counsel for the Defendant
Defendant
HEARD: September 23 rd , 2011
REASONS FOR JUDGMENT
PARAYESKI J.
[ 1 ] In ruling upon an appeal and cross-appeal herein, the Ontario Court of Appeal permitted the parties to address the issue of trial costs in the event that they were unable to agree upon the same. They do agree that the Defendant is obliged to pay the Plaintiff his costs of the trial on the partial indemnity scale; they differ significantly regarding the appropriate quantum of those costs. It is my task to fix the same.
[ 2 ] Bearing in mind that I am not an assessment officer, I shall take a somewhat holistic approach in arriving at the appropriate figures. I will not parse each attendance and disbursement.
[ 3 ] The subject matter of this action was accident benefits owed under a contract of insurance between the parties. The trial lasted for 14 days. The result of the trial was that the Defendant was ordered to pay the Plaintiff damages for unpaid income replacement benefits assessed at $101,732.79, plus prejudgment interest in accordance with section 68 of the Statutory Accident Benefits Schedule , which itself came to $438,268.65.
[ 4 ] I am asked by the Plaintiff to approach this case as though it were one wherein at stake was roughly $500,000.00. I reject that premise. While the interest payable and paid was very substantial in relation to the actual damages, its being owed was purely a function of statute. Its being owed was not contested. It simply wasn’t an issue at trial. The only possible effort expended on the part of the Plaintiff to be awarded the interest was the doing of a simple arithmetical calculation. If counsel expect to be paid bonuses as part of costs for exceptional results achieved by extraordinary efforts, they cannot simultaneously expect to be paid for doing nothing or next to nothing in having over $400,000.00 fall into their client’s lap by operation of statute.
[ 5 ] I turn now to the hourly rates being sought by Plaintiff’s counsel David Smye, his then-associate Adrian Nurse, and their clerk. They seek $450.00, $250.00 and $100.00 respectively on the partial indemnity scale.
[ 6 ] Notwithstanding the fact that Mr. Smye is one this province’s pre-eminent Plaintiff counsel, the rate claimed for his services is excessive. When this matter was tried in 2006, very few counsel in this jurisdiction were being paid $450.00 even by their own clients, much less that amount on the partial indemnity scale. $350.00 per hour is appropriate for Mr. Smye on that scale.
[ 7 ] Relative to Mr. Nurse, the claimed rate of $250.00 is also too high, particularly since his actual role is not made clear from the Plaintiff’s costs productions, including the time dockets that were submitted. Accordingly, I cannot and do not know if Mr. Nurse was doing anything beyond shadowing Mr. Smye. Under these circumstances, $150.00 per hour for Mr. Nurse on the partial indemnity scale is appropriate.
[ 8 ] The clerk’s rate, although generous, is not excessive.
[ 9 ] In terms of the sought time said to have been expended, there is really quite little in the way detail regarding individual attendances. I note that Mr. Nurse accompanied Mr. Smye to the first of two days’ worth of examinations for discovery. The Plaintiff claims only for Mr. Smye’s time for three mediations (two by telephone), and for the pre-trial.
[ 10 ] For trial preparation, the Plaintiff claims 149.5 hours for Mr. Smye, 120 hours for Mr. Nurse and 85 hours for the clerk.
[ 11 ] For the trial itself, the Plaintiff claims for 14 days at 10 hours per day for both Mr. Smye and Mr. Nurse, and for the clerk as well.
[ 12 ] Relative to work on non-sitting days and weekends, a claim is advanced for 40 hours’ worth of Mr. Smye’s time, 20 hours for that of Mr. Nurse and 20 hours for the clerk.
[ 13 ] Written submissions were made after the evidence was heard. For that, some 20 hours of Mr. Smye’s time is claimed, together with 40 hours of Mr. Nurse’s time. It is not at all clear to me just what the distinction is, if any, between those times, which are set out at item seven of the Plaintiff’s bill of costs and those set out at item nine.
[ 14 ] With the exception of the point made in the paragraph above concerning the submissions, I generally accept the times being claimed for Mr. Smye as being reasonable. I do have difficulty, however, with those times being claimed in respect of Mr. Nurse and the clerk, especially in the absence of meaningful particulars.
[ 15 ] While the fact that Mr. Smye has not attended a trial without at least junior counsel for many years is both enviable and commendable (from a mentoring perspective at least), I am not at all convinced that this is something for which an opposing party is responsible in the partial indemnity context. What Mr. Smye and his client may have agreed upon between themselves in terms of multiple attendees being present at certain stages of the litigation is not something to which the Defendant was privy.
[ 16 ] Fees are being sought at $296,975.00 plus GST. This is significantly excessive for all of the reasons set out above. A much more reasonable figure is $170,000.00 plus GST. It is still more than double the fees of the Defendant counsel on the same scale and it is what I fix in respect of this element.
[ 17 ] I shan’t repeat what I have already said about not intending the vet the disbursements on a line by line basis. I shall address, however, the issue which causes the most concern about the $144,036.52 being sought for disbursements, net of some small advance payments made in 1977 and 1998 according to the bill of costs. It is the fact that the disbursements being claimed in respect of, I believe, Doctors Kaplan, Welland and Ireland, and Terry Pierce all contain significant compound interest factors. Those rates are unconscionable. In the case of Doctor Kaplan, the interest being sought by him is 24.0 percent per annum.
[ 18 ] While I agree with the basic premise that the experts ought not be put into the position of financing a Plaintiff’s lawsuit for him or her, there is a vast difference between not doing so and condoning the kind of usury being practiced in this case. Especially when dealing with costs on the partial indemnity scale (and perhaps even on the full indemnity scale), it is important to remember that the paying litigant was not a party to whatever interest rate agreement or agreements into which the receiving litigant may have entered.
[ 19 ] While some reasonable interest may otherwise have been appropriate, I wish to send a very strong message in this case, and I award none whatsoever. The disbursements in respect to the persons named above are fixed at their principal amounts and applicable taxes only. The materials provided to me do not clearly set out those amounts, and so I shall not try to decipher what they are. If counsel cannot agree on those amounts, they may arrange to appear before me once again. All other disbursements are allowed as per the bill of costs.
[ 20 ] Should the parties wish to address costs the appearance before me, they may do so by means of brief written submissions. Each set of such submissions, if any, should be no more than three pages in length, and are to be sent to my attention at the John Sopinka Court House in Hamilton. They are due on or before July 1 st , 2012.
The Honourable Justice Parayeski
Released: May 29, 2012
COURT FILE NO.: 98-3810
DATE: 2012-05-29
ONTARIO SUPERIOR COURT OF JUSTICE B E T W E E N: DANIEL STRANGES Plaintiff - and – ALLSTATE INSURANCE Defendant REASONS FOR JUDGMENT Parayeski J. MDP:dm
Released: May 29, 2012