SUPERIOR COURT OF JUSTICE - ONTARIO
COURT FILE NO.: 06-28661
DATE: 2012-08-22
RE: Whitehall Homes & Construction Ltd., Plaintiff
AND: Brian Hanson and Elaine Hanson, Defendants
BEFORE: The Honourable Madam Justice J. A. Milanetti
COUNSEL: Jon-David Giacomelli and Raong Phalavong, for the Plaintiff
Brian Campbell, for the Defendants
COSTS ENDORSEMENT
[ 1 ] The successful plaintiff seeks their costs on a substantial indemnity basis in the amount of $317,247.47. Alternatively, they seek partial indemnity costs of $205,419.40. The defendants argue that substantial indemnity costs are inappropriate and in any event the fees claimed are excessive. They suggest that the partial indemnity costs should be reduced to $58,752.81.
[ 2 ] Factually speaking, this was the defendant’s motion to amend their pleadings. I dismissed this motion as a result of my acceptance of the position of the plaintiff (advanced by way of cross-motion), that summary judgment should be granted, enforcing minutes of settlement between the parties.
[ 3 ] The alternative relief sought by the plaintiffs (in their cross motion) was a determination of new versus original deficiencies for the purposes of proceeding to trial on the new deficiencies only. The defendant argues that much of the time spent in preparation and at the motion dealt with this alternative relief and that should be eliminated. I do not find this to be a reasonable proposition.
[ 4 ] The plaintiffs were faced with significant amendments to a claim they thought had been settled. They were also faced with the reports of experts/contractors. The defendants made the decision to advance these amendments alleging deficiencies well in excess of the initial not insignificant purchase price of their home. They set this renewed litigation in motion; they cannot now claim that the responding contractor’s response to same was unnecessary or excessive.
[ 5 ] All of that being said, I do not find solicitor and client costs to be appropriate. Moreover, I find even the partial indemnity costs to be more than an unsuccessful litigant would expect to pay.
[ 6 ] That said I do not accept that Mr. Hanson would have expected this entire new venture to have cost $25,000. He was involved in much of this “renewed” litigation, and certainly saw the magnitude of the materials placed before me for consideration on this motion and the summary judgment that responded to it.
[ 7 ] As indicated previously, Mr. Hanson is not a naïve or unsophisticated individual. He is a successful businessman.
[ 8 ] The plaintiff shall have their costs on a partial indemnity scale. The $205,419.40 sought shall however be reduced. The Bill of Costs reflect the involvement of numerous lawyers at various levels. This had to have meant significant duplication of effort. It is clear that Mr. Giacomelli was lead counsel; clearly supported by Ms. Phalavong. I would eliminate Mr. McLeod’s fees of $754.00.
[ 9 ] I would further reduce the fees claimed by numerous young lawyers of roughly the same vintage. Each of Mamay, Leung, and Shin were called to the bar in 2009; Singh in 2008. The aggregate fees for these four individuals amount to $9,339.21. While it may be cost effective to utilize more junior counsel on a file, that benefit is substantially reduced when several different individuals are involved. As such, the aggregate fees of the aforementioned lawyers ($9,339.21) shall be reduced by 1/3 to $6,226.14. I would similarly reduce the fees of Jacobs by 1/3 to $3,694.60 as I find the hours spent excessive in the face of the aggregate fees sought by the more senior counsel.
[ 10 ] As such, the fees partial indemnity account shall be reduced to reflect the foregoing concerns by $5,714.37 .
[ 11 ] I would further reduce the fees of both Mr. Giacomelli and Ms. Phalavong on the following basis:
$6,366.10 for attendance at a status hearing and setting a timetable is not within the reasonable expectation of an unsuccessful litigant. That entry shall be reduced to $2,000.
I find the attendance between the receipt of the motion materials and the hearing were over lawyered. I do not accept that all of Mr. Giacomelli’s 354.5 hours (100.1 hours + 186.2 hours + 68.2 hours) and Ms. Phalavong’s 306.6 hours (154.2 hours +112.00 hours + 40.40 hours) were warranted. I would thus reduce Ms. Phalavong’s time by 25 percent (76.65 hours) to 229.95 hours. As such, her fees pre hearing shall be reduced from $44,811 to $33,608.25.
Moreover, I have a couple of issues with the fees relative to the hearing itself. The total fees claimed are on a substantial indemnity basis and thus should be reduced by 1/3. Additionally, I do not understand why Ms. Phalavong’s fees would exceed Mr. Giacomelli’s for attendance at the hearing given that he did all of the oral argument before me. I would thus reduce her hours to mirror his – from 21.4 to 14.2 hours. When both reductions are made, the fees relative to the attendance at the hearing are reduced to $6,161.67.
[ 12 ] When all of these additional considerations are factored in, the additional reductions to the partial indemnity costs are $20,449.67 (1. $4,366.10 + 2. $11,202.74 + 3. $4,880.83). WHEN ADDED TO THE SUM REFERENCED IN PARAGRAPH 10, THE TOTAL REDUCTIONS IN THE PARTIAL INDEMNITY ACCOUNT TENDERED IS $26,164.04 PLUS HST THEREUPON.
[ 13 ] While the ultimate account being assessed is not insignificant- $145,258.54 plus HST and disbursements , I would conclude that significant lawyering (a lead and a second chair) were warranted in this matter given the complexity and the breadth of the motions being advanced.
Dated this day of August, 2012.
MILANETTI J.