SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: C-224-12
DATE: 2012-12-3

RE: 1719286 ONTARIO INC., Applicant

AND:

WATERLOO STANDARD CONDOMINIUM CORPORATION NO. 435. PAULINE THOMSON, ANDREZEJ WYSZOMIERSKA, and PIOTR LIS, Respondents

BEFORE: The Honourable Mr. Justice D.A. BROAD

COUNSEL:
Robert W. Dowhan - for the Applicant

Devon M. Ryerse - for the Respondents

COSTS E N D O R S E M E N T

[ 1 ] In my Endorsement dated October 3, 2012 I directed that the parties may make brief written submissions with respect to costs. The parties’ submissions have now been received and the following is my disposition with respect to costs.

[ 2 ] Section 131 of the Courts of Justice Act, R.S.O. 1990, c. C. 43 provides that the costs of and incidental to a proceeding are in the discretion of the court and the court may determine by whom and to what extent the costs shall be paid.

[ 3 ] The parties each seek entitlement to costs, on the basis that their position was vindicated by the disposition of the Application. The Applicant’s position is that it is entitled to substantial indemnity costs on the basis that the condominium corporation was found to be not in compliance with the governance requirements of the Condominium Corporation Act, 1998 S.O. 1998, c. 19 and was ordered to call a membership meeting by November 16, 2012 to elect a new board of directors, and to hold an annual meeting by June 30, 2013.

[ 4 ] The Respondents seek costs on the basis that the Applicant did not succeed in achieving its main objective on the Application, namely a finding that the Respondents had acted in an oppressive manner and that its claim of entitlement to maintain outdoor storage in the common element areas should be recognized.

[ 5 ] Rule 57.01(1) sets forth a number of factors which the court may consider in exercising its discretion under Section 131 of the Courts of Justice Act . These include (e) the conduct of any party that tended to shorten or lengthen unnecessarily the duration of the proceeding, and (f)(i) whether any step in the proceeding was unnecessary.

[ 6 ] As noted in my Endorsement, the heart of the dispute related to the Applicant’s claim that it was entitled to store various materials in the common element space. Prior to that dispute coming to a head in the Small Claims Court action which was brought by the condominium corporation, the Applicant raised no complaint with respect to compliance by the corporation with the governance provisions of the Condominium Corporation Act, 1998. The Respondents readily acknowledged the technical non-compliance with the requirements of the Act and consented, in argument, to a remedial order in that respect. If technical compliance were the only issue, the matter no doubt would have been dealt with very readily and at very little expense. It was the oppression claim related to the outside storage issue which motivated the Applicant, which predominated on the Application and on which the Applicant was ultimately unsuccessful.

[ 7 ] It is my view that, as the Respondents were largely successful on the Application, they should be entitled to partial indemnity costs. However, since they did not serve an Offer to Settle proposing settlement on the basis of a remedial order to correct the governance deficiencies, their costs should be discounted to reflect the fact that such an order was ultimately made at the instance of the Applicant.

[ 8 ] On the question of the quantum of costs the overriding principle is fairness and reasonableness. The costs should generally reflect the amount that an unsuccessful party should reasonably expect to pay.

[ 9 ] The Respondent’s partial indemnity costs, in their Bill of Costs, total $ 13,120.99 in respect of fees, based on 78 hours of lawyers’ time, plus 14.3 hours of students’ time. This would appear to accord to the Applicant’s reasonable expectations, as exemplified by its own Costs Outline and Bill of Costs, indicating total lawyers’ time of 84.85 hours, plus clerks’ time.

[ 10 ] I would reduce the Respondents’ claim for partial indemnity costs of $15,011.98 by $2,723.50, to account for the costs that would have been awarded to the Applicant had it confined its claim to a remedial order on the governance issues. This amount is comprised of $2,000.00 in respect of fees, HST in the sum of $260.00, application fee in the sum of $181.00, and service and photocopying in the sum $250.00, plus HST thereon of $32.50.

[ 11 ] The Applicant shall therefore pay to the Respondents costs fixed in the sum of $12,288.48 inclusive of fees, disbursements and HST.

D. A. Broad J.

DATE: December 3, 2012