SUPERIOR COURT OF JUSTICE – ONTARIO
COURT FILE NO.: 50737/08 (St. Catharines)
DATE: 2012/10/10
RE: Earl Chevalier (Plaintiff) v. Active Tire & Auto Centre Inc. (Defendant)
BEFORE: The Honourable Mr. Justice R.A. Lococo
COUNSEL:
Bradley J. Troup, for the Plaintiff
Orlando M. Rosa, for the Defendant
HEARD: By written submissions
E N D O R S E M E N T – C O S T S
[ 1 ] Earl Chevalier ’s action for wrongful dismissal against Active Tire & Auto Centre Inc. was dismissed after a four and a half day trial. [^1] Costs were left to be determined based on written submissions.
[ 2 ] In its costs submissions, Active Tire requested payment of its costs by Mr. Chevalier on a partial indemnity basis, given its success at trial. Active Tire requested that its costs be fixed in the amount of $62,376.68, which included fees of $50,000 plus disbursements and tax. The amount claimed for fees was $14,637.46 less than the amount indicated in Active Tire’s costs outline. In Active Tire’s submission, this amount was reasonable, taking into account the principle of indemnity as well as the reasonable expectations of an unsuccessful party with respect to costs. [^2]
[ 3 ] Mr. Chevalier did not dispute that Active Tire, as the successful party, should be awarded its costs on a partial indemnity basis. His counsel argued, however, that the amount claimed was excessive. In his submission, the amount awarded should not exceed $40,000 inclusive of disbursements and tax.
[ 4 ] After reviewing Active Tire’s costs outline and considering the submissions of counsel, I have concluded Active Tire’s costs should be fixed at $50,000 inclusive of disbursements and tax. In doing so, I considered the factors set out in subrule 57.01(1) of the Rules of Civil Procedure , which include the principles of indemnity and the reasonable expectations of an unsuccessful party [^3] , as discussed further below .
[ 5 ] With respect to the principle of indemnity, I reviewed the costs outline, and found the time and rates charged by Active Tire’s counsel to be generally reasonable. The costs outline indicated, however, that the rates and amounts for fees on a partial indemnity basis were exactly the same as the amounts that were actually charged to the client. I do not dispute that the partial indemnity rates and amounts set out in the costs outline were not unreasonable in isolation. However, partial indemnity costs awards are not intended to fully cover the legal fees of the successful party, however reasonable the amount actually charged may be. On different reasoning, Active Tire in fact conceded that it would not be appropriate to recover the full amount of fees charged in this case, given the discount from fees actually charged that it proposed based on the reasonable expectations of an unsuccessful party. However, in my view, the amount of the proposed reduction was not sufficient to reflect an appropriate difference between actual costs and partial indemnity costs.
[ 6 ] I also considered Mr. Chevalier’s submission that he should not be expected to pay the travel expenses of Active Tire’s counsel for discoveries and trial. Active Tire’s counsel is located in Sault Ste. Marie. Active Tire’s head office is in the Toronto area. The trial was in St. Catharines.
[ 7 ] In this case, I concluded that it was reasonable for Active Tire’s travel expenses to be covered. Active Tire has a large number of locations throughout Ontario. Use of out-of-town counsel, even if not from the area of Active Tire’s head office, was not in itself unusual, and may well have been a cost-effective choice in the circumstances. I note as well that the amounts claimed for travel expenses were relatively modest. In my view, declining to order payment of counsel’s travel expenses in this case would mean second guessing Active Tire’s judgment with respect to choice of counsel. I am not prepared to do so in this case.
[ 8 ] As previously indicated, in fixing the amount for costs, I also took into account the reasonable expectations of an unsuccessful party. In this regard, I agree with Active Tire’s counsel that Mr. Chevalier should reasonably have expected a significant costs award in Active Tire’s favour if he was unsuccessful in his action. However, in my consideration of this and other factors set out in subrule 57.01(1) , I am not bound by the calculation of hours and time rates in arriving at a result that is fair and reasonable to both parties [^4] . In my view, fixing costs in the amount I have indicated strikes an appropriate balance in all the circumstances.
[ 9 ] Accordingly, an order will go requiring Mr. Chevalier to pay Active Tire’s costs of the action, fixed at $50,000 inclusive of disbursements and tax, within 30 days.
The Honourable Mr. Justice R.A. Lococo
DATE: October 10, 2012
COURT FILE NO.: 50737/08 (St. Catharines)
DATE: 2012/10/10
SUPERIOR COURT OF JUSTICE - ONTARIO RE: Earl Chevalier (Plaintiff) v. Active Tire & Auto Centre Inc. (Defendant) BEFORE: The Honourable Mr. Justice R.A. Lococo COUNSEL: Bradley J. Troup, for the Plaintiff Orlando M. Rosa, for the Defendant ENDORSEMENT – COSTS Lococo J.
DATE: October 10, 2012
[^1]: Chevalier v. Active Tire & Auto Centre Inc. , 2012 ONSC 4309 (S.C.) .
[^2]: See paragraphs (0.a) and (0.b) of subrule 57.01(1) of the Rules of Civil Procedure , R.R.O. 1990, Reg. 194.
[^3]: Ibid .
[^4]: See Boucher v Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291 (C.A.) at para 26 .