COURT FILE NO.: 08-CV-346646

DATE: 20121127

SUPERIOR COURT OF JUSTICE – ONTARIO

RE: DAVID FITZPATRICK , Plaintiff

AND:

SHELLEY ORWIN, BILL SQUIRES AND ANNA SQUIRES , Defendants

BEFORE: Stinson J.

COUNSEL:
James C. Morton , for the plaintiff

Jeffrey Radnoff , for the defendant Shelley Orwin

Eddy J. Battiston and Alexandra M. Battiston, for the defendants Bill Squires and Anna Squires

HEARD: By written submissions

ENDORSEMENT AS TO COSTS

[ 1 ] In my reasons for judgment dated June 18, 2012, I dismissed the plaintiff's action, marked the counterclaim of Ms. Orwin as abandoned, and granted judgment in favour of the Squires on their counterclaim and awarded damages in their favour in the total amount of $166,085.35. I found that Fitzpatrick had violated the Squires' legal rights when he harassed them and inflicted mental distress upon them and I therefore ordered injunctive relief permanently restraining Fitzpatrick from having any contact with the Squires. I directed the parties to make written submissions as to costs if they were unable to agree on the disposition of that issue. I have now received written submissions and this endorsement addresses them.

liability for costs

[ 2 ] Fitzpatrick was wholly unsuccessful in that his claims against all defendants were dismissed. The Squires were wholly successful in their counterclaim. The counterclaim of the defendant Orwin was withdrawn prior to trial, but I have received no submissions in respect of that aspect of the matter.

[ 3 ] The ordinary rule in relation to costs is that they should be paid by the unsuccessful party to the successful party. No submissions were made that would warrant a departure from that rule. Accordingly, I hold that Fitzpatrick is liable to pay costs to the Squires in respect of the main action and in relation to their counterclaim. I further hold that Fitzpatrick is liable to pay costs to Orwin in respect of her successful defence of the main action. I make no order as to costs in relation to Orwin's counterclaim.

scale of costs

[ 4 ] The defendants seek costs on a substantial indemnity scale. The plaintiff submits that costs should be fixed on a partial indemnity scale only.

[ 5 ] As the Court of Appeal stated in Prinzo v. Baycrest Centre for Geriatric Care (2002), 2002 45005 (ON CA) , 60 O.R. (3d) 474 at para. 76 , 2002 Carswell Ont 2263 (Ontario Court of Appeal 2002):

As a general rule solicitor-and-client costs are awarded on very rare occasions such as when a party has displayed outrageous conduct during the proceedings ….

As McLachlin J. put it in Young v. Young, 1993 34 (SCC) , [1993] 4 S.C.R. 3 at p. 134:

Solicitor-client costs are generally awarded only where there has been reprehensible, scandalous or outrageous conduct on the part of one of the parties.

Or, as was stated by the Court of Appeal in Davies v. Clarington (Municipality) (2009), 2009 ONCA 722 , 100 O.R. (3d) 66 at para. 40 :

Apart from the operation of rule 49.10 [offer to settle], elevated costs should only be awarded on a clear finding of reprehensible conduct on the part of the party against which the cost award is being made.

[ 6 ] In the present case, I have no hesitation in finding that Fitzpatrick engaged in reprehensible conduct both before and during the litigation. As my reasons for judgment set out in detail, he conducted an anti-social campaign of harassment against the Squires for no good or proper reason, culminating in the placement of a dead coyote on the hood of their motor vehicle, akin to a mafia-like death threat. Quite apart from the award of punitive damages, such misconduct easily qualifies as grounds for an award of substantial indemnity costs.

[ 7 ] Further, during the course of the proceeding themselves, Fitzpatrick made baseless and speculative allegations of conspiracy as against the Squires and Orwin. Having forced his sister to retain counsel and participate in the trial, he proffered no evidence whatsoever that would support any finding of wrongdoing on her part. As well, as I have found, his testimony was demonstrably untruthful.

[ 8 ] In my view, the nature of the allegations made, the fact that they were groundless and unsupported by the evidence, combined with the untruthful testimony of Fitzpatrick all combine to amount to serious misconduct in the proceedings, and also warrant an award of costs on a substantial indemnity basis.

[ 9 ] I therefore order Fitzpatrick to pay costs to all of the defendants on a substantial indemnity scale.

quantum of costs

[ 10 ] I will consider the costs claims of each of the defendants separately.

(a) Squires

[ 11 ] The Squires seek substantial indemnity costs of $166,404.87. Fitzpatrick takes no issue with the time spent or the disbursements incurred. His only submission related to the claim for enhanced costs. I have previously addressed that point.

[ 12 ] In relation to the principles enunciated under rule 57.01(1), I comment as follows:

(0.a) Indemnity

The amount claimed by the Squires is based on the legal expenses incurred by them. They are merely seeking to be made whole. The extensive allegations made against them and the damages claimed required them to retain legal counsel who spent considerable time and effort defending them. The amounts claimed are based upon the rates charged and the hours spent, and I find them reasonable.

(0.b) Reasonable expectation of the unsuccessful party

Fitzpatrick had to know that he was forcing the Squires to incur significant legal costs. Ultimately, he put them through an eight day trial in Superior Court. He had to expect that, just as he was incurring a significant legal bill to his own lawyer, he was forcing the Squires to do the same. He also had to know that he was exposing himself to a substantial adverse order as to costs if he failed to prevail at trial. In my view, the sum sought by the Squires is within the reasonable expectation of their unsuccessful opponent.

(a) Amount claimed and recovery

The Squires were exposed to a claim for half a million dollars. Among other allegations, Fitzpatrick asserted that the Squires did not own the land on which they erected the new fence. They had to take the matter seriously. Not only did they completely defeat Fitzpatrick's claim, but they recovered damages in excess of $166,000. This result supports the amount of costs claimed by them.

(b) Apportionment

The Squires were wholly successful.

(c) Complexity

The matter was of above-average complexity, involving as it did an extensive factual record relating to the Squires' and Fitzpatrick's interactions over an extended period of time, both in relation to each other and the police. This is reflected in the fact that my factual and legal analysis of the case consumed some 178 paragraphs. This factor supports the costs claimed by the Squires.

(d) Importance of the issues

For the Squires, this case became all important. It consumed much of their retirement savings. It challenged their peace of mind and sense of security. It was extremely important to them. This factor weighs in favour of the Squires costs claim.

(e) The conduct of any party that tended to lengthen the duration of the proceeding

Fitzpatrick's unwarranted inclusion of his sister as a co-defendant lengthened the proceeding unnecessarily.

(f) Improper, unnecessary or negligent steps

Fitzpatrick's initiation of the proceedings was, in my view, vexatious. That was undoubtedly the case in relation to his request for a certificate of pending litigation and his refusal to allow it to be removed unless the Squires tore down the new fence, despite the fact that a new survey unequivocally determined that the fence did not encroach on Fitzpatrick's land. Again, this factor warrants a high costs award in favour of the Squires.

(g) Refusal to admit anything that should have been admitted

Fitzpatrick should, early on, have conceded that the fence was not built on his land.

[ 13 ] None of the remaining factors in rule 57.01(1) specifically bears on the quantum of costs that should be awarded to the Squires in the present case.

[ 14 ] Based upon my review of the other rule 57.01(1) factors, they more or less uniformly support a significant costs award in favour of the Squires. Indeed, having regard to the underlying facts of the litigation, as I found them, this is a case in which an award of significant costs in favour of the innocent parties is entirely warranted and justified. To do otherwise would be to further victimize the Squires due to Fitzpatrick's misconduct.

[ 15 ] I therefore fix the Squires' costs at the full amount claimed by them, $166,404.87.

(b) Orwin

[ 16 ] Ms. Orwin claims costs on a substantial indemnity scale of $70,058.03. The significant difference between the cost claims of the Squires and that of Orwin reflects the extent to which the Squires were the true object of Fitzpatrick's campaign and the need to which the Squires were forced to muster significant resources to respond.

[ 17 ] That said, Orwin plainly incurred substantial expenses as well. As I have noted, the allegations as against her were wholly speculative and unproven. She faced a claim for a significant damage award, and was forced to participate in the trial.

[ 18 ] Between April 2009 and July 2010, Orwin was represented by the same counsel as the Squires. They retained that counsel separately and were billed separately. Following the July 2010 pretrial, however, Orwin was separately represented. Her substantial indemnity costs claimed up to July 21, 2010 are $23,447.76. From that date forward, they are $46,610.27, for a total of $70,058.03.

[ 19 ] Turning to the factors under rule 57.01(1)(a), many of the comments previously made apply here as well. I will nevertheless deal with them independently:

(0.a) Indemnity

Once again, the amounts sought by Orwin merely reflect indemnification for the costs incurred, based upon her lawyers' level of experience and the rates charged. In this case, indemnity is an appropriate factor that justifies the costs claimed by Orwin.

(0.b) Unsuccessful party's expectations

In the present case, Fitzpatrick had to know that forcing Orwin to retain counsel throughout the trial would be an expensive exercise. The lawyer's attendance at trial comprised the largest portion of the fees charged. This factor supports the amount claimed.

(a) Amount claimed and recovered

Orwin faced a significant damage claim; nothing was recovered. The amount sought justifies the expense she incurred.

(b) Apportionment of liability

No liability was found.

(c) Complexity

See my comments above.

(d) Importance

Orwin had to take the matter seriously, given the amount claimed.

(e) Conduct that tended to lengthen the proceeding

Fitzpatrick tendered no evidence to implicate his sister, yet he forced her to participate in the trial. This was wholly unnecessary.

[ 20 ] In my view, none of the other factors under rule 57.01(1) are germane.

[ 21 ] Based upon my review of the rule 57.01(1) factors, I conclude that the costs claim of Orwin is almost wholly justified. My only hesitation is that it includes some amounts on account of the drafting of her counterclaim, which was abandoned prior to trial. In my view, the withdrawal of the counterclaim was a sensible decision. Since it did not proceed to trial, there is no need to adjust the amount of trial costs awarded. There should be some reduction, however, in relation to cost claimed for drafting pleadings, and trial preparation. I would impose a modest reduction of $2,000.

[ 22 ] After subtracting a reduction of $2,000 on account of the time spent dealing with the counterclaim, I fix Orwin's costs at $68,058.03.

disposition

[ 23 ] For the following reasons, I order David Fitzpatrick to pay costs to Bill Squires and Anna Squires in the total amount of $166,404.87. I order David Fitzpatrick to pay costs to Shelley Orwin in the total amount of $68,058.03.

Stinson J.

Date: November 27, 2012