MILTON OURT FILE NO.: 6029/10
DATE: 2012-07-27
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Zahra Maftoun
Zahra Maftoun, self represented
Plaintiff
- and -
Seyed Hassan Banitaba, Mahmoud Zargar and Law Society of Upper Canada
J. Chahal, for the Defendant Mahmoud Zargar
H. Niroomand for the Defendant Seyed Hassan Banitaba
Defendants
HEARD: Written Submissions
COSTS ENDORSEMENT
Ricchetti, J.
[1] Reasons for Judgment in this matter were released on May 22, 2012.
[2] The parties were invited to make written submissions on entitlement and quantum of costs.
[3] Written submissions were received from all parties.
Filing of the Written Submissions
[4] The first issue which needs to be dealt with is a submission by Ms. Maftoun that I should disregard Mr. Banitaba's submissions because, notwithstanding that the submissions were served on Ms. Maftoun's trial counsel and delivered to me on time, they were not filed with the court. I reject this submission.
[5] First, there was no requirement in my reasons for filing written submissions. My reasons only provided that the submissions be provided to me within the requisite time. The submissions should and will be considered.
[6] I will add that there is no prejudice or unfairness to Ms. Maftoun as the written submissions had been served on her counsel and Ms. Maftoun has responded to Mr. Banitaba's Cost Submissions.
[7] In the interest of fairness to all parties, if it had been necessary, I would have granted leave to Mr. Banitaba to file his written submissions.
The Position of the Parties
Mr. Banitaba
[8] Mr. Banitaba seeks costs in the amount of $63,506.95 (all inclusive on a partial indemnity basis) for this 8 day trial.
[9] Essentially, Mr. Banitaba's position is that he was a successful party at trial and there is no reason to deprive him of costs. Despite the allegations of fraud, Mr. Banitaba does NOT seek substantial indemnity costs.
[10] I have reviewed the Costs Outline. It is true there is no detail as to the dates of the performance of the legal services. However, given the history of the matter, the number of motions and the entries, it would appear to me that $43,596 for fees on pre-trial matters is not unreasonable in these circumstances. As for the counsel fee of $13,560, again it is reasonable given the number of trial days and the experience of Mr. Niroomand. The disbursements claimed do not appear to be inconsistent with the necessary expenditures in an action such as this or excess in cost for the services required by counsel to defend this action.
Mr. Zargar
[11] Mr. Zargar seeks a total of $64,698.33 (all inclusive on a partial indemnity basis) for costs. Despite the allegations of fraud, Mr. Zargar does NOT seek substantial indemnity costs.
[12] In essence, Mr. Zargar's position is that he was successful on the Summary Judgment motion and the action and there is no reason to deprive him of his reasonable costs of the action on a partial indemnity rate.
The Action
[13] This action was hard fought. There were many motions. Some were unnecessary. The pre-trial proceedings were extensive and significantly increased costs. From my review, all parties are equally responsible for this. The complexity of the action was compounded by concurrent legal proceedings in Iran dealing with the same issues.
[14] Mr. Zargar and Mr. Banitaba brought a motion for summary judgment at the beginning of trial. The motion was dismissed.
[15] During the course of the trial, Mr. Zargar raised a significantly new defence. Ms. Maftoun consented to the amendment and no adjournment was sought. The trial continued until completion.
Ms. Maftoun
[16] Ms. Maftoun submitted a 12 page written submission on costs which had appended additional documents, not in evidence, including some documents to rebut factual issues and some documents setting out alleged oral discussions at settlement discussions.
[17] Despite being unsuccessful, Ms. Maftoun seeks costs of the action. Ms. Maftoun sets out a number of grounds for her claim including:
She was successful in defending the Summary Judgment motion. I accept that this is a factor which weighs in Ms. Maftoun's favour, but only with respect to the costs of the Summary Judgment motion;
On consent, Mr. Zargar amended his pleading during the trial to add a significantly new and different defence. This amendment did extend the length of the trial and should have been dealt with by Mr. Zargar in the pleadings well in advance of the trial;
While it is accurate to suggest that I commented this action should have been stayed as the identical issues were before the Iranian Court, all parties wanted this Court to deal with the claims in this action. It is too late for Ms. Maftoun to suggest this action should have been stayed;
Ms. Maftoun is correct that there were significant credibility findings for ALL parties, including her. I am not persuaded it would be unfair to grant costs to a party where this finding has been made given this same finding has been made against all the parties. Any cost reduction for this would benefit one party at the expense of the other when all parties were subject to the same finding;
5 and 6) Ms. Maftoun goes on to argue that the trial "was frustrated and sabotaged by the Defendants' lawyers";
Ms. Maftoun goes on to allege that "if Niroomand had not misled the court…..the Plaintiff would not have had to prove fraud in the first place." Further, she submits that the fraud allegations did not lengthen the trial or the discoveries. There is no merit to these submissions in the context of cost submissions;
Ms. Maftoun submitted that most of Mr. Zargar's evidence was not before the Court in his Statement of Defence. Ms. Maftoun goes on to include additional documents she "would have obtained" if she had known of the allegations. The difficulty with this submission is that the amendment was made on consent and there was no request for an adjournment;
Ms. Maftoun submits that the defendants included "unsupported evidence" at the trial. Unfortunately, some of the evidence Ms. Maftoun refers to viva voce evidence that was not disputed during the trial, some to evidence that was accepted at the trial, and some evidence not critical to the central issue. This issue is not appropriate at this stage - the assessment of costs; and
Ms. Maftoun also alleges that Mr. Zargar failed to include certain facts in his defence and that counsel "acted in bad faith by not amending Zargar's pleadings..." Ms. Maftoun alleges "misconduct" by Mr. Niroomand by making untrue submissions. This issue is not appropriate at this stage - the assessment of costs.
[18] Ms. Maftoun's submissions goes on for several more pages:
• attacking Zargar's evidence;
• setting out contradictory evidence from the discoveries;
• setting out further facts not in the evidence;
• repeating sections of the Request to Admit;
• alleged admissions made at meetings;
• repeating of "off the record" statements;
• providing details of pre-trial oral settlement discussions;
• providing new documents which confirm Ms. Maftoun's evidence at trial; and
• suggesting that the examinations for discovery were extremely lengthy because of an "incompetent translator was retained by Defendant's counsel," unreasonable number of questions or refusals to answer. However, there is no evidence this issue was raised during the examinations for discovery.
[19] Ms. Maftoun concludes with a cost outline seeking $69,987.15 (all inclusive). It is not clear how this amount is arrived at based on her Cost Outline.
[20] Ms. Maftoun also provided a "Response to Defendants Costs Submission and Costs Outline."
[21] Ms. Maftoun raises the following issue with Mr. Banitaba's Cost Outline:
a) Fabricating disbursements: Ms. Maftoun has reviewed all filed materials and then proceeds to draw certain conclusions regarding the motivation as to why and when documents were served and/or filed. I cannot possibly and do not draw from this the conclusion that the disbursements were fabricated by Mr. Banitaba's lawyer;
b) Some of the amounts claimed include time counsel spent dealing with Ms. Maftoun's complaint to the Law Society. I accept that this is not a part of the action and time spent on this time should be deducted;
c) Ms. Maftoun takes issue with some of the time spent by Mr. Niroomand on the motions, drafting documents. She states: "Niroomand is not a real litigator and really did not know how to draft this document."; and "It is bad enough that Niroomand is dishonest but he is also sloppy. On the grounds of stupidity alone he should be denied costs;"
d) Ms. Maftoun claims in her "Notice of Appeal, the Plaintiff asks for costs against Niroomand and Chahal [the lawyers] on a ground that they both misled the court." This is irrelevant to the issue to be decided at this time; and
e) The submissions continue for a number of paragraphs in the some tone and substance.
[22] Turning to Mr. Zargar's Cost Outline, Ms. Maftoun raises the following issue:
a) Mr. Chahal's submission that Mr. Zargar was successful on the Summary Judgment motion is wrong. I accept this submission by Ms. Maftoun as accurate;
b) Mr. Zargar is seeking costs from pervious counsel on the motion before Justice Bielby which should be denied because the motions were caused by previous counsel failing to file the Statement of Defence on time; and
c) Ms. Maftoun has already paid costs ordered on at least one motion. Costs should not be ordered in connection with this motion. I agree.
Analysis
[23] There are no Offers to Settle which are applicable in this case.
[24] There is no claim by any of the parties to substantial indemnity costs, notwithstanding the unproven allegations of fraud.
[25] Ms. Maftoun raises no valid or compelling reason to deny Mr. Zargar and Mr. Banitaba costs in this proceeding as they were the successful parties. Much of Ms. Maftoun's submissions are simply to re-argue certain facts or to make accusations against counsel for Mr. Zargar and Mr. Banitaba or their counsel. The problem with these submissions is that it ignores the facts Ms. Maftoun commenced the action, Ms. Maftoun alleged fraud, the evidence at trial did not establish fraud or any other claim and the action was dismissed.
[26] The real issue is what costs should be awarded to Mr. Zargar and Mr. Banitaba.
[27] I accept Ms. Maftoun's submission that there is no date set out when the time was spent by counsel. In these circumstances, it is more difficult to have a critical, detailed review of the fees claimed to determine a reasonable amount. In addition, there is no supporting documentation for the disbursements claimed. While the disbursements appear to be reasonable, copies of the receipts could have been made available, even if only for the largest expenses.
[28] I considered whether to order an assessment of the costs under Rule 58 of the Rules of Civil Procedure, R.S.O. 1990, O. Reg. 194. However, in these circumstances, to do so would not be consistent with the provisions of Rule 57(7) which provides:
The court shall devise and adopt the simplest, least expensive and most expeditious process for fixing costs and, without limiting the generality of the foregoing, costs may be fixed after receiving written submissions, without the attendance of the parties.
[29] Ordering an assessment in this case would be extremely time consuming, expensive for the parties and present a very significant challenge to the Assessment Officer. In my view, the presiding judge is in the best position to properly and fairly deal with the determination as to what reasonable and fair costs are in these circumstances. I am also persuaded that I can fix reasonable and fair costs in this case, and at the same time assess and deal with the issues raised by the parties in their written submissions and Cost Outlines. The primary reasons this can be done include:
a) As to the quantum of costs claimed, all three parties have claimed approximately the same amount for fees and roughly the same amount for disbursements. All parties were represented by counsel throughout the trial and throughout the action (albeit Ms. Maftoun was unrepresented for a brief period); and
b) Any adjustments due to the issues raised in the submissions can be accomplished through an appropriate adjustment of what are reasonable costs in this case.
[30] In fixing costs, the overriding principle is fairness and reasonableness taking into account the reasonable expectation of the parties as to costs, with some consistency with costs in similar proceedings, and of course taking into account the factors set out in Rule 57 of the Rules of Civil Procedure, supra. See. Larcade v. Ontario (2006), 2006 CanLII 17943 (ON SCDC), 35 C.P.C. (6th) 55 (Div. Ct.)
[31] This was a factually complex action involving historical issues compounded by legal proceedings in another jurisdiction. The legal issues were not overly complex. Ms. Maftoun claimed damages well in excess of $1,000,000 (being the costs of the gold coins and other alleged damages) together with interest over a very lengthy period of time. No doubt the exposure to the defendants was at or close to $2,000,000. As I stated above, this was a "hard fought" action with "hard" positions taken by all parties throughout the action. The examinations for discovery were extensive. There were many cross-examinations on many affidavits filed. Interpreters and translations were necessary.
[32] I accept that the reasonable costs in this action are approximately $65,000, all inclusive given that each of the parties are claiming approximately the same amount.
[33] Starting with $65,000 all inclusive is the reasonable and fair amount of costs payable to each of the successful parties, taking into account the submissions of the parties, I make the following adjustments:
a) The first day of trial was occupied with the defendants' Summary Judgment motion. The motion was dismissed. There will be a reduction in costs for this issue;
b) Both Mr. Banitaba and Mr. Zargar's counsel include costs of the motions, including before Justice Gray and Justice Bielby, in one case where costs were fixed and paid by Ms. Maftoun and, the other where the court agreed to fix costs but, for some unknown reason, neither party pursued costs before the presiding judge. There will be a further reduction for this issue;
c) Mr. Zargar amended his pleading at trial, raising a significant and substantially new defence. This extended the trial. There will be a further reduction for this issue; and
d) Mr. Banitaba's Costs Outline includes unrecoverable items such as dealing with issues involving the Law Society. Further there are some time entries which appear to be excessive. For example, the time spent on summons to witness by Mr. Niroomand. There will be a further reduction for this issue.
Conclusion
[34] Ms. Maftoun shall pay to each of Mr. Zargar and to Mr. Banitaba the sum of $35,000 all inclusive of disbursements and HST. Costs are payable forthwith.
Ricchetti, J.
Released: July 27, 2012
MILTON OURT FILE NO.: 6029/10
DATE: 2012-07-27
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Zahra Maftoun
Plaintiff
- and –
Seyed Hassan Banitaba, Mahmoud Zargar and Law Society of Upper Canada
Defendants
COSTS ENDORSEMENT
Ricchetti J.
Released: July 27, 2012