ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 24060/07; 24175/07
DATE: 2012-10-11
BETWEEN:
JOHN TRUMBLE AND JOSEPH COULSON AND VANKOUGHNET AND AWERES LOCAL ROADS BOARD
Plaintiffs
– and –
GARY GORVAL AND SUZANNE MARIE GIONET
Defendants
John Paul Paciocco, for the Plaintiffs
T. Frederick Baxter, for the Defendants
HEARD: November 29, 30, December 1, 2, 6, 7, 8, 9, 13, 2011 and January 18, 19, 20, 30, February 1, 2, and 3, 2012
reasons on costs
JUSTICE E. GAREAU:
[ 1 ] On June 28, 2012 I released a 29-page decision dealing with issues that proceeded to trial before me for 15 days spanning from November 29, 2011 to February 3, 2012.
[ 2 ] Subsequent to the release of my Reasons, I have received and reviewed written submissions from counsel for the parties on the issue of costs.
[ 3 ] The plaintiffs enjoyed the overwhelming preponderance of success in this litigation. On all of the five issues decided in this case, the ruling of the court favoured the plaintiffs on each and every issue.
[ 4 ] As set out in Section 131 (1) of the Courts of Justice Act , R.S.O. 1990, c. 43 costs are in the discretion of the court subject to any provisions in the Rules that may assist the court in the exercise of its discretion.
[ 5 ] In the exercise of its discretion under Section 131 of the Courts of Justice Act to award costs, the court may consider the result in the proceeding, any offer to settle made in writing and the factors set out in Section 57.01(1) of the Rules of Civil Proceeding.
[ 6 ] In deciding the issue of costs, it is important for the court to consider the offers to settle made in writing by the parties.
[ 7 ] A history of the written offers to settle exchange by the parties is as follows:
(a) The plaintiffs’ (Trumble and Coulson) offer dated January 25, 2010 – this offer proposes that the property in question be declared a public road. The balance of the offer is essentially what the court ultimately ordered. This offer proposes that the defendants contribute to the plaintiffs’ costs in the amount of $7,500.00.
(b) The aforementioned offer to settle went unrsesponded to by the defendants. This resulted in a follow-up letter dated March 29, 2010 from Mr. Paciocco to Mr. Baxter. Of particular interest in that follow-up letter is paragraph 5 which reads as follows:
“It is my distinct recollection of the pre-trial held in this matter by Justice Koke that it was his view that your clients would not be successful with their efforts to close the road. It is also my recollection that it was Justice Koke’s view at the status hearing on March 4, 2010 that he felt there should be a settlement of the matter given the fact that the parties will be facing a two-week trial. The cost of such a proceeding may be financially crippling to your clients if they are unsuccessful. In the circumstances, I urge you to seriously consider and/or reconsider our clients’ offer of settlement in this matter as, in my view, the costs of proceeding further beyond today’s date will quickly escalate and, in my view, preclude the possibility of settlement whatsoever. It is my intention to start with the interview and preparation of witnesses in anticipation of a trial in this matter and I intend to start that process by mid-April, 2010 as there are a number of witnesses who will have relevant testimony on the issues. Once that process commences, costs are going to escalate rapidly as indicated and the possibility of resolving the matter without substantial payment of costs, as earlier indicated, will be forever lost.”
(c) The aforementioned offers to settle by the plaintiff to the defendants was rejected by a letter dated March 30, 2012 from Mr. Baxter to Mr. Paciocco. The second line of that letter reads as follows:
“As indicated, I believe orally, your offer of January 25, 2010 is not acceptable.”
(d) A letter dated May 10, 2010 from the solicitor for the plaintiffs to the solicitor for the defendants reads as follows:
“When we spoke in person at court a couple of weeks ago, you had indicated you would respond further. If you are able to obtain instructions from your clients respecting any possible terms of settlement, then please courier them to our office. I cannot wait past Friday of this week to order transcripts.”
(e) The plaintiffs (Trumble and Coulson) forwarded to the defendants (Gorval and Gionet) a further formal offer to settle dated May 16, 2011. This offer is some 16 months after the January, 2010 offer and is closer in time to the trial of this action which commenced on November 29, 2011. In the offer dated May 16, 2011 the plaintiffs propose a resolution that finds the disputed land declared a public road. It is essentially the same offer as earlier proposed in January 25, 2010 except that paragraph 9 of the offer proposes that “each party shall pay its own costs.”
(f) By letter dated November 7, 2011 from Mr. Baxter to Mr. Paciocco, Mr. Gorval and Ms. Gionet indicate a proposal of settlement as follows:
“1. My clients will consent to the access road coming from the northwest (on the 1937 photo and the 1954 map) being declared a common road. This would remove vehicles and others at least some distance away from my clients’ house. Any costs of opening up the old road would be those of your clients. It is obviously somewhat overgrown now. From the point where it re-enters the field the “road” would stay close to the trees and proceed in a northeasterly direction along the present track till it passes out of the Gorval/Gionet property. My client would of course be at liberty to close the present gate and build a fence along the easterly boundary of the road where it enters the field or open area. I should think a 20 ft. right of way would be sufficient for the kind of right of way which your clients envisage.
- Costs of $6,500.00 all in.”
(g) The aforegoing paragraph sets out the written offers to settle exchanged between the parties prior to the trial commencing, after the trial commenced and four days of evidence was heard by the court. A further pre-trial conference was conducted on December 2, 2011 by Mr. Justice I.S. McMillan. As a result of the pre-trial, there were further written offers exchanged between the parties. By letter dated December 5, 2011, Mr. Baxter wrote to Mr. Paciocco indicating:
“This letter will constitute our offer to settle on the basis of the terms worked out in the pre-trial discussions with Justice McMillan on Friday, December 2, 2011.”
This offer accepted that the road was a public road with the width of the road allowance being 33 feet. The last two sentences in that read as follows:
“The other part of our offer to settle is that each party should bear his, her or its costs. This letter will be relied upon if the trial continues and a copy will be filed with the court as part of my submissions on the issue of costs at that time.”
This offer was withdrawn the same day by a fax from Mr. Baxter to Mr. Paciocco, which reads as follows:
“The offer sent to you by letter of today’s date at 3:54 p.m. is hereby withdrawn.”
In my view, the withdrawal of this offer a short time after it was made and certainly before it could be considered and responded to by the plaintiffs essentially makes it a non-offer.
[ 8 ] As a result of the pre-trial on December 2, 2012 the plaintiffs forwarded to the defendants a further proposal of settlement by letter dated December 5, 2012 from Mr. Paciocco to Mr. Baxter which reads as follows:
“I wish to confirm my client’s willingness to settle matters as follows:
the matter will settle in accordance with the terms set out in my May 16, 2011 offer to settle except in relation to court costs and the size of the roadway;
the May 16, 2011 terms of settlement would be amended to indicate the size of the roadway to be 33 feet in accordance with the Honourable Mr. Justice I.S. McMillan’s recommendation;
the issue of costs to be argued before Mr. Justice Gareau tomorrow morning.
I also wish to confirm as of this morning you have advised that the trial will in fact continue tomorrow and under the circumstances, I am not expected to have a bill of costs ready for tomorrow’s purposes.”
[ 9 ] The trial continued beyond December 5, 2011 for a further 12 days excluding submissions which were received by counsel in writing.
[ 10 ] It is very clear from a review of the offers to settle that the plaintiff’s offers were closer to the ultimate decision made by the court and ought to have been accepted by the defendants. This is especially true of the May 16, 2011 offer of the plaintiffs which proposed that the matter be resolved on essentially the same terms as ultimately decided by the court after trial and on a no-costs basis with each party bearing their own costs of the litigation.
[ 11 ] The plaintiffs (Trumble, Coulson and Vankoughnet & Aweres Local Roads Board) are entitled to their costs given the offers to settle exchanged and the ultimate success in the litigation enjoyed by the plaintiffs.
[ 12 ] In reviewing the bill of costs submitted by the plaintiffs and the appropriate quantum of costs, I am guided by Rule 57.01(1) of the Rules of Civil Procedure. In my review of the bill of costs submitted by the plaintiff’s counsel, I take no issue as to the hourly rate of $250.00 claimed. I also take no issue with the counsel fee of $3,000.00 per day claimed, which is appropriate given the seniority of the plaintiff’s counsel and the nature and complexity of the issues in this case. The reductions I make to the bill of costs submitted by counsel for the plaintiff is in the area of preparation which I have reduced. This matter occupied 16 days of trial. The counsel fee for that alone is $48,000.00. The counsel fee submitted for the all-day pre-trial on December 2, 2011 of $3,000.00 and attendances arising from this of $1,000.00 on December 5, 2011 is not unreasonable. In addition to these amounts, I would allow a further $23,000.00 for all attendances prior to the trial, and post-trial, including the preparation of written submissions on the substantive matter and costs. The disbursements claimed of $5,190.00, inclusive of H.S.T., are not unreasonable upon a review of the breakdown of these disbursements and what was required to bring this matter to trial.
[ 13 ] The plaintiff has claimed a total amount of $120,042.07 for costs, inclusive of the counsel fees, disbursements and H.S.T. on these amounts. With the deductions indicated, I am of the view an appropriate amount for costs to be ordered in favour of the plaintiffs is $90,000.00, inclusive of disbursements and H.S.T.
[ 14 ] There shall be an order that the defendants, Gary Gorval and Suzanne Marie Gionet jointly and severally pay costs to the plaintiffs in this action in the amount of $90,000.00 payable forthwith.
Justice E. Gareau
Released: October 11, 2012
COURT FILE NO.: 24060/07; 24175/07
DATE: 2012-10-11
ONTARIO SUPERIOR COURT OF JUSTICE BETWEEN: JOHN TRUMBLE AND JOSEPH COULSON AND VANKOUGHNET AND AWERES LOCAL ROADS BOARD Plaintiffs – and – GARY GORVAL AND SUZANNE MARIE GIONET Defendants REASONS ON COSTS Justice E. Gareau
Released: October 11, 2012