COURT FILE NO.: CV-09-00379*213-0000

DATE: 20120920

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: PCM TECHNOLOGIES INC., Plaintiff

AND:
DANIEL O’TOOLE, carrying on business as “PHOENIX SYSTEMS”, and 478161 ONTARIO LIMITED, for the Defendants

BEFORE: T. McEwen J.

COUNSEL:
Evan L. Tingley , for the Plaintiff

Justin M. Jakubiak , for the Defendants

HEARD: March 26, 27, 28, 29, 30, and April 2, 2012

costs and prejudgment interest ENDORSEMENT

introduction

[ 1 ] In this action, the Plaintiff sued the Defendants as a result of an agreement to provide certain software and services. In my Reasons for Decision released June 8, 2012, I found that the Defendant O’Toole was to pay the Plaintiff the sum of $126,932.33 plus prejudgment interest.

[ 2 ] The parties have been unable to settle the issues of prejudgment interest and costs and submissions were made in this regard in writing.

prejudgment interest

[ 3 ] With respect to the issue of prejudgment interest I agree with the Defendants’ submissions that prejudgment interest should run from November 28, 2008 which is the closest approximate date as to when the relationship between the parties completely broke down and the Plaintiff advised O’Toole that it would no longer be using its services. I disagree with the Plaintiff that prejudgment interest should run from the “go-live” date since, although problems did arise, the parties worked together to try to resolve them right up until November 28, 2008.

[ 4 ] The parties agree that prejudgment interest shall run at the 1.3%.

costs

[ 5 ] There is no dispute that the Plaintiff is entitled to costs on a partial indemnity basis. The issue is with respect to quantum.

[ 6 ] The Defendants do not dispute that the disbursements are reasonable. I have reviewed them and they seem to be in order. Accordingly, the amount of $6,984.17 shall be paid in this regard.

[ 7 ] With respect to the issue of fees, the Plaintiff seeks fees, including GST or HST in the amount of $56,799.46 (in addition to the disbursements for a total of $63,783.63).

[ 8 ] The Defendants claim that on a proportionate basis this amount is high and point to the fact that their own partial indemnity costs, including disbursements, total $45,215.91.

[ 9 ] The amount sought by the Plaintiff is not a disproportionate to the amount awarded to the Plaintiff. It was a somewhat complicated trial the total amount sought by PCM was much higher. In the usual course it is also not surprising to see a Plaintiff’s costs higher than those of the Defendant’s given the typical work involved in preparing for trial.

[ 10 ] As pointed out by Lauwers J. in Sydie et al. v. Murad et al. , 2012 ONSC 416 :

[3] The relevant principles of the exercise of the court’s discretion were canvassed by the Court of Appeal in Davies v. Clarington (Municipality) (2009), 2009 ONCA 722 , 100 O.R. (3d) 66 per Epstein J.A. at para 51, focussing on the specific facts and circumstances of the case in relation to the factors set out in rule 57.01(1): Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291 (C.A.) [2004] O.J. No. 2634, Moon v. Sher (2004), 246 D.L.R. (4th) 440 (Ont. C.A.) [2004] O.J. No. 4651, and Coldmatic Refrigeration of Canada Ltd. v. Leveltek Processing LLC (2005), 75 O.R. (3d) 638 (C.A.). She noted at para. 52 that:

…the overriding principle is reasonableness. If the judge fails to consider the reasonableness of the costs award, then the result can be contrary to the fundamental objective of access to justice. Rather than engage in a purely mathematical exercise, the judge awarding costs should reflect on what the court views as a reasonable amount that should be paid by the unsuccessful party rather than any exact measure of the actual costs of the successful litigant. In Boucher , this court emphasized the importance of fixing costs in an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding at para. 37, where Armstrong J.A. said “[t]the failure to refer, in assessing costs, to the overriding principle of reasonableness, can produce a result that is contrary to the fundamental objective of access to justice.”

[4] An element is the losing party’s reasonable expectation as to the costs payable: Moon v. Sher at paras. 21, 22, 35 . Proportionality also plays a role: Rule 1.04 (1.1).

[ 11 ] I have kept in mind the above comments in assessing costs. In this regard, I have carefully reviewed the Plaintiff’s Bill of Costs.

[ 12 ] The amount of time spent on pleadings, discovery, the pretrial and trial seem somewhat high given the level of complexity of the issues and the amount in question. It would be fair to reduce the Plaintiff’s fees by 10% and I would therefore reduce them to $51,119.51.

disposition

[ 13 ] Prejudgment interest shall therefore be calculated at the rate of 1.3% from November 28, 2008.

[ 14 ] Costs shall be assessed in the amount of $51,119.51 for fees, plus disbursements of $6,984.17, for a total of $58,103.68.

[ 15 ] Costs shall be paid within 30 days.

T. McEwen J.

Date: September 20, 2012