SUPERIOR COURT OF JUSTICE - ONTARIO
COURT FILE NO.: 06-CV-306081
ENDORSEMENT RELEASED: August 7, 2012
RE: STEVE MOORE, JACK MOORE and ANNA MOORE v. TODD BERTUZZI, ORCA BAY HOCKEY LIMITED PARTNERSHIP and ORCA BAY HOCKEY, INC. dba THE VANCOUVER CANUCKS HOCKEY CLUB
BEFORE: Master R. Dash
COUNSEL:
Timothy Danson, for the plaintiffs
Geoffrey Adair, for the defendant Bertuzzi
Alan D’Silva and Ellen Snow, for the Orca Bay defendants
COSTS ENDORSEMENT
[ 1 ] This endorsement deals with the costs of a variety of motions brought by all parties that were heard and determined on January 4, 2012, with one motion continuing on January 23, 2012, resulting in reasons released on February 15, 2012 and a motion to reconsider heard on February 27, 2012, resulting in an addendum released on February 28, 2012. I have received costs submissions from all parties.
[ 2 ] The motion that was most divisive among the parties and which occupied the bulk of the court’s time concerned disclosure of the settlement agreement. It was argued for less than an hour on January 4 th and at the defendants’ request, to give them more time to consider the issues, was adjourned to January 23 rd and I ordered that any agreement be provided for the court’s inspection on that date. On January 23 rd the agreement was tendered for the court’s inspection and the argument occupied the full half day set aside for the motion. All parties submitted extensive case law. The plaintiffs were totally successful in compelling production of the agreement and costs should follow the event.
[ 3 ] I do not agree with the plaintiffs that substantial or full indemnity costs are warranted for this motion. Although the decision not to disclose the agreement was intentional, it was a decision made in the honest but mistaken belief that the defendants had a right or even an obligation not to disclose and there was no intent to mislead the court. The law was somewhat unsettled and the parties differed on how to apply the jurisprudence respecting Mary Carter agreements to the circumstances of the agreement among these defendants and third party. I am unable to say that the defendants’ conduct was “reprehensible, scandalous or outrageous”, the usual criterion for substantial indemnity costs [1] , nor am I able to conclude that the defendants’ failure to disclose in these circumstances should attract elevated costs as a “consequence of the most serious nature” as stated by the court of appeal in Aecon v. Brampton . [2]
[ 4 ] On the other hand, because considerable time was spent to prepare for and argue this motion, the plaintiffs have incurred significant costs, even on a partial indemnity scale. The motion was of great importance to the plaintiffs as the agreement significantly changed the landscape of the litigation. The motion was equally important to the defendants who fought to resist disclosure. As a result both sides expended considerable resources on the issue.
[ 5 ] I would include, as part of the costs of the motion to which the plaintiffs are entitled, the costs of the attendance on February 27, 2012, requested by the defendants to clarify my February 15 th reasons respecting the behaviour of the defendants’ lawyers. I had already stated in my February 15 th reasons that the defendants had not deliberately misled the court as to the status of the defendants’ adversity on January 4 th during the hearing of the motion for the two neuropsychological examinations. My addendum was issued primarily to give the defendants’ lawyers solace that I accepted that they had made an honest mistake and that they were not in breach of their professional obligations. The plaintiffs’ lawyers had to attend to ensure that the submissions were confined to issues surrounding the professionalism of the defendants’ lawyers, particularly as Orca Bay’s notice of motion requested that the court “vary” three paragraphs of my February 15 th reasons. This was of great concern to the plaintiffs since those paragraphs made findings of fact and the decision was under appeal by the defendants. I did not change my view that the defendants, despite their honest mistake, still had a duty to disclose the existence of the agreement to end adversity between them and to dismiss the crossclaims before I ordered two neuropsychological examinations. Although I also granted on February 27 th a temporary stay of my production order pending appeal, the plaintiffs did not oppose the stay and this involved minimal time for the plaintiffs.
[ 6 ] A number of motions were decided on January 4 th . Although the motion brought by the defendant Bertuzzi on his own behalf and on behalf of the Orca Bay defendants to compel the plaintiff to submit to two neuropsychological assessments, including two clinical interviews, one on behalf of each defendant, was successful, I would not award costs of that motion to the defendants. Given that the defendants breached their duty to disclose the settlement agreement and to advise the court that there was no longer adversity between the defendants on liability and given that two neuropsychological assessments would never have been ordered on January 4 th had I known the true state of adversity among the defendants, the plaintiffs are entitled to the costs of that motion. The plaintiffs would have been successful on the motion had the defendants revealed the true state of adversity [3] (the rationale for which is set out in my reasons of June 28, 2012). I would go farther and say that the plaintiffs should have their costs of that part of the motion on a substantial indemnity scale. Although the defendants’ conduct could not be described as reprehensible or outrageous, elevated costs for the very motion obtained due to the defendants’ breach of their disclosure obligations is called for as part of the “consequences of the most serious nature” as stated by the court of appeal in Aecon v. Brampton . Notwithstanding that the defendants did not intend to mislead, as the court of appeal stated in Aecon , the legal obligation of immediate disclosure is clear and unequivocal. For the defendants to have stated on January 4 th that the existence of an agreement was “mere speculation” was in my view a serious breach of the defendants’ obligation of “immediate” disclosure and it resulted in a miscarriage of justice in the awarding of two neuropsychological assessments (a matter corrected in my decision of June 28, 2012.)
[ 7 ] It is somewhat difficult to separate out the time spent by the plaintiffs’ lawyers on the January 4 th motion dealing with the neuropsychological assessments. Very little time was devoted to the issue in their written materials, although it took more time at the January 4 th hearing than any other motion heard that day and I gave detailed handwritten reasons. I have determined that it would be fair and reasonable to award two hours of elevated costs for each of Mr. Danson and Ms. Delavar (preparation and hearing time combined) on this issue. (Of course the motion heard June 11 th was entirely devoted to this issue and I do not suggest that the plaintiffs will not be entitled to elevated cost for the entirely of that motion, but that is not before me at this time and does not form part of this costs endorsement.)
[ 8 ] The plaintiffs were also successful in having the neuropsychological examinations ordered to be conducted in Toronto, barring any legal impediment. When issues arose with respect to Dr. McCrae’s not having permission from the Ontario College of Psychologists and with respect to entering Canada for such purpose, the plaintiffs were put to further costs in doing research and taking steps to ensure the problems were resolved since Mr. Adair was taking the position that the examinations should be moved to Milwaukee. In connection with that issue they also reasonably attended when the defendants appeared before me to settle and sign the formal order to ensure that the court was aware of the reasons for a truncated order. The plaintiffs should be compensated for their time on these issues, as they are all connected with the January 4 th motion, albeit in my view at a partial indemnity rate. Likewise the plaintiffs should be compensated for the attendance to settle and sign the order with respect to Dr. Maroon particularly as Mr. Adair had made some suggestion that the truncated order with respect to the neuropsychological examinations was the entire order, a position later abandoned.
[ 9 ] Further orders were made on January 4 th on the plaintiffs’ omnibus motion. On April 27, 2009 I had ordered the plaintiff to provide his consent to Orca Bay to enable that defendant to request Moore’s scouting reports from the Colorado Avalanche. Orca Bay had not provided the reports despite a number of requests. The plaintiff reasonably sought an order to compel Orca Bay to confirm the request was made and provide any information received. At the hearing Orca Bay confirmed they had made the request and received no response and as a result, on consent, I ordered production of the letters of request. On April 27, 2009 I had ordered Orca Bay to provide surveillance details and the plaintiffs moved to compel compliance. As it turned out the investigators were uncovered by Moore and never reported in writing to Orca Bay. Prior to the return date of the motion, Orca Bay agreed to provide an authorization for plaintiff’s counsel to speak directly with the investigators and this was ordered on consent.
[ 10 ] The balance of the plaintiffs’ motion on January 4 th was opposed. The plaintiffs sought several orders to fix a timetable for the defendants to take certain steps. The plaintiffs sought an order to require the defendants to identify what defence medicals they would be seeking and the timing of such medical examinations and reports. Mr. Adair indicated he had no present intention of seeking any defence medicals except those sought in his own motion heard that day and as such the plaintiffs’ motion elicited the information sought. Given Mr. Adair’s stated intention and given rule 53.03 and the pending pre-trial date, I felt it was unnecessary to make an order further abridging the time for those expert reports.
[ 11 ] The defendants, and particularly Orca Bay, first raised the issue of moving to strike the jury notice on July 21, 2011, but no such motion had ever been brought notwithstanding that it would have significantly affected the trial date. Indeed an alternate future trial date had been given by the list judge in the event of such motion was successfully brought. The plaintiffs sought a deadline for such motion. I set a deadline for the booking and hearing of any pre-trial motion to strike the jury notice, a significant victory for the plaintiffs.
[ 12 ] The plaintiffs sought an order abridging the time for the defendants to deliver expert reports on the loss of Moore’s hockey career. I granted the order and set a deadline, thereby abridging the time under rule 53.03. Although the deadline ordered was a date that Mr. D’Silva had suggested at one time as a reasonable deadline, he now resisted an order binding him to that suggestion. Mr. Adair also opposed the deadline that had been suggested.
[ 13 ] In addition to the motion for the two neuropsychological examinations, Bertuzzi also moved for an order to compel Moore to attend in Pittsburgh for a defence medical examination by Dr. Maroon, a neurosurgeon. The plaintiffs consented to the examination, but objected to travelling to Pittsburgh. In the result the plaintiffs were successful in having me order the examination to take place in Toronto. Finally, Bertuzzi moved for production of the raw test data from two neuropsychologists who had earlier seen Mr. Moore. By the time the motion was heard the plaintiffs had already provided the data from one of the neuropsychologists and it had been revealed that, except for a summary which had been provided, the raw test data of the other had been destroyed. It was not unreasonable for Bertuzzi to have brought the motion as it succeeded in getting the answers, however this was a relatively simple motion with minimal materials and minimal time spent at the hearing of the motion.
[ 14 ] The Orca Bay defendants also brought a motion to compel raw test data from the plaintiff’s vocational assessor and to compel examination of Mr. Moore after production of the notes. Orders were made on consent for the plaintiffs to use best efforts to obtain the data and provide letters of request if not received and to attend for follow up examination, but limited both in scope (only on documents produced since the last examination) and in time (four hours), an order that had already been made at a case conference on November 23, 2011, but never acted upon. This order was a modest success for Orca Bay.
[ 15 ] Although the defendants had some modest success on the motions, in my view the plaintiffs were overwhelmingly successful and they should have their costs of the motions, including the attendances on January 4, January 23 and February 27, 2012 with a small reduction for the defendants’ partial success on some issues. As indicated all costs will be on a partial indemnity basis other than 2 hours on a substantial indemnity basis for each of the plaintiffs’ two lawyers attending on the motions.
[ 16 ] In my view the time spent by plaintiffs’ lawyers and their hourly rates are reasonable. I would include Mr. Reich’s time as lawyer time as his research time was instrumental. The fixing of costs however is not simply a mechanical exercise of multiplying hours spent by hourly rates. Costs of a motion are within the discretion of the court. [4] In exercising its discretion the court must consider all relevant factors, including the reasonable expectations of the losing parties and all other factors listed in rule 57.01 and determine what is fair and reasonable in the circumstances. [5]
[ 17 ] These motions, in particular the motions involving the settlement agreement, the neuropsychological assessments and the timelines were of great importance. Some of the issues, particularly the issue of the settlement agreement, were of significant complexity and involved considerable case law. Consequently substantial time was necessarily spent by plaintiffs’ lawyers. In addition to time spent preparing for the issues on the motions the plaintiffs’ costs were increased because they were required to prepare for a cross-examination of Mr. Reich by Mr. Adair, which was cancelled on the date of the examination (although there is a dispute about when the plaintiffs produced documents Mr. Adair was seeking) and researching issues arising therefrom. The plaintiffs also had to prepare for an adjournment that Mr. Adair indicated he would seek, but then did not proceed with.
[ 18 ] Although the time spent by the three lawyers for the plaintiffs could have been set out with more specificity and broken down into time spent on various motions and while production of dockets would have been helpful in analyzing the costs claimed, I consider the totality of the time spent and costs claimed for the plethora of motions dealt with on the three days in light of their importance and complexity and the number of motions and issues considered on the motions. I also consider that the costs should be reduced by a small amount to account for the defendants’ limited success and the otherwise partial indemnity costs increased by costs at a substantial indemnity rate for a portion of the motion as indicated in these reasons.
[ 19 ] The plaintiffs seek costs in the sum of $38,526 on a full indemnity scale or $23,508 on a partial indemnity scale, inclusive of disbursements but apparently exclusive of HST which must be added into the totals. HST would increase the totals to $43,534 (substantial indemnity) or $26,564 (partial indemnity).The Orca Bay defendants suggest that the costs claimed by the plaintiffs are excessive and submit that costs to the plaintiffs be fixed at no more than $15,000, however they have not provided me with the time spent by them on these motions. They have had at least two lawyers working on the file and attending on the motions. The defendant Bertuzzi does not suggest an appropriate costs order, but does set out a claim for $6,016 costs for his motion to compel undertakings and produce test data on a partial indemnity scale, which while not diminishing its importance to Bertuzzi, was a relatively simple motion . He also sets out his firm’s time for the test data motion, the neuropsychological assessment motion, the motion to compel Dr. Maroon in Pittsburgh, the motion to produce the settlement agreement, the issue respecting Dr. McCrae attending in Canada and the attendance to settle and sign the orders which total approximately $24,316 on a partial indemnity scale or $34,215 on a substantial indemnity scale and which involve the work of four lawyers as well as clerks.
[ 20 ] Considering all of the above factors I am of the view that costs of these motion to the plaintiffs in the sum of $23,000 inclusive of disbursements and HST is fair and reasonable and within the reasonable contemplation of the defendants.
[ 21 ] It is impossible to break down liability for these costs as between the defendants. The settlement agreement and neuropsychological assessment motions involved both defendants and as well each defendant had separate motions they were bringing or to which they were responding. In my view the fairest disposition is to make the costs payable jointly and severally by Bertuzzi and by the Orca Bay defendants. Although the obligation to the plaintiffs will be joint and several, the defendants can as between themselves consider how the costs should be proportionally shared, in accordance with their settlement agreement or otherwise.
ORDER
[ 22 ] The defendants shall pay to the plaintiffs on a joint and several basis the costs of the motions heard on January 4, January 23 and February 27, 2012 within 30 days fixed in the sum of $23,000.00
Master R. Dash
DATE: August 7, 2012
[1] Young v. Young , 1993 34 (SCC) , [1993] 4 S.C.R. 3, [1993] S.C.J. No. 112 (S.C.C.) at para. 251
[2] Aecon Buildings, a Division of Aecon Construction Group Inc. v. Brampton (City) , 2010 ONCA 898 , [2010] O.J. No. 5630 (C.A.) at para. 16 .
[3] In fact the order was varied by me to permit only one neuropsychological assessment by order dated June 28, 2012.
[4] Courts of Justice Act , section 131
[5] Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 14579 (ON CA) , 71 O.R. (3d) 291, [2004] O.J. No. 2634 (C.A.)