Superior Court of Justice – Ontario

Court File No.: 6312/12
Date: 2013-03-28

RE: Sandra Elsley, Plaintiff

AND:

John Bordynuik, Defendant

Before: The Honourable Mr. Justice R. J. Nightingale

Counsel:
Frederick Hawa, Counsel, for the Plaintiff
Mark Abradjian, Counsel, for the Defendant

Costs Endorsement

[1] I have now received the written submissions of the parties with respect to the request for costs by the Defendant. My Order set aside the Order of Justice Matheson granting the Plaintiff a Mareva Injunction and dismissed the Plaintiff’s motion for that injunction.

[2] There is authority for the granting of an award against the Plaintiff of substantial indemnity costs when setting aside a Mareva Injunction because of nondisclosure (Sparkle Ventures Inc. v. At My Accounting Department Inc. [2011] O.J. No. 1742). Although this Court had obvious concerns with the conduct of the Plaintiff in not providing full disclosure to Justice Matheson, I cannot find that the conduct on the part of the Plaintiff meets the test of reprehensible, egregious behaviour deserving of sanction required by our Court of Appeal in the decision of Davies v. Clarington (Municipality) (2009) 2009 ONCA 722, 100 O. R.(3d) 66 before such an award can be granted.

[3] Accordingly, costs are awarded to the Defendant on a partial indemnity basis.

[4] With respect to the quantum of costs, there is no doubt that the Defendant’s lawyers were required to act quickly and diligently over the holiday season to prepare the initial responding affidavit and motion materials of their client to set aside the Order of Justice Matheson obtained on an ex parte basis on December 20, 2012 by the Plaintiff. They were required to attend in Welland unfortunately having to spend a full day on January 2, 2013 regarding the initial motion to set aside the Order.

[5] The Plaintiff then prepared supplementary affidavits requiring the Defendant’s lawyers to respond accordingly with their client’s affidavits.

[6] They prepared for and conducted the cross-examinations of the parties that took place over two days and prepared for and attended on the hearing of this motion which took one day.

[7] Mr. Abradjian, senior Counsel (1995 call), acting for the Defendant was engaged for approximately 62 hours from the time of his receipt of the Order of Justice Matheson until the completion of this matter including his time to prepare the affidavits, attend on the cross-examinations and attend on the two motion dates.

[8] Junior Counsel Ms. Kis (2009 call) provided details of approximately 93 hours of her time assisting Mr. Abradjian on the file. There is also some additional time for co-Counsel Mr. Durden of approximately five hours.

[9] Counsel for the Plaintiff submitted that the total time spent by the Defendant’s lawyers was unreasonably high suggesting that they had spend almost twice as much time as he had on the motion. He also suggests that the Defendant is not entitled to costs for both Senior and Junior Counsel for all the hours spent.

[10] I have considered the provisions of Rule 57.01 in exercising my discretion under S. 131 of the Courts of Justice Act in determining the appropriate quantum of costs payable by the Plaintiff to the Defendant.

[11] In particular, the setting aside of the Order of Justice Matheson was of particular importance to the Defendant as the Order effectively prevented him from disposing of any of his shares in his company in the ordinary course of business.

[12] Although the materials provided were voluminous, the motion was not particularly complex as it in essence dealt with issues of nondisclosure of material information that ought to have been provided to Justice Matheson at first instance and which motion ultimately resulted in the setting aside of his Order because of the failure of the Plaintiff to do so.

[13] The additional relevant factor under Rule 57.01 of the reasonable expectation of the unsuccessful party that must be considered in determining an amount of costs that is fair and reasonable was also confirmed in the leading decision of Boucher v. Public Accountants Council for the Province of Ontario (2004) 2004 14579 (ON CA), 71 O.R. (3d) 291(C.A.).

[14] An appropriate rate on a partial indemnity basis would be reasonable in the amount of approximately $290 per hour for Mr. Abradjian and $150 per hour for Ms. Kis. No doubt Mr. Abradjian and Ms. Kis had to spend more time than Plaintiff’s Counsel which is what would be expected in this case given the amount involved and the significance of the original Order to the Defendant. The Defendant’s costs should not be determined by doing an exact mathematical calculation and the Plaintiff should be allowed a reduction for some duplication of effort by Senior and Junior Counsel. Rather, by assessing and fixing an amount which is fair and reasonable to both parties and within the reasonable expectation of the Plaintiff to pay if unsuccessful in the motion, I conclude that an award of $28,000 plus HST of $3640 plus disbursements of $3500 inclusive of HST for partial indemnity costs of the motion payable by the Plaintiff to the Defendant would be reasonable in the circumstances.

[15] With respect to the time for payment of the costs, Rule 57.03 states that unless the Court is satisfied that a different order would be more just, the Court shall fix the costs of the motion and order them to be paid within 30 days.

[16] The Plaintiff has submitted that the Defendant’s costs for this motion should be payable to the Defendant in any event of the cause but only after 30 days after the trial has been concluded. The Plaintiff also requested that the Defendant’s costs of this motion should be reduced to zero in the event that the Plaintiff was successful at trial but is left unpaid by the Defendant for 30 days after an order at trial.

[17] In the circumstances of this case, given the level of nondisclosure by the Plaintiff at first instance before Justice Matheson and even though I have not made any adjudication on the merits of the Plaintiff’s action, the appropriate Order is that the costs are payable to the Defendant in any event of the cause as of the date of the decision of the Court at the trial or other disposition of this action.

The Honourable Mr. Justice R. J. Nightingale

Date: March 28, 2013