ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: CV-07-184
DATE: 2013/06/25
BETWEEN:
JESSE FERGUSON, SHERRY FERGUSON, MARK FERGUSON and TYLER FERGUSON by his Litigation Guardian, Sherry Ferguson
David F. MacDonald/R. Ben, for the Plaintiffs
Plaintiffs
- and -
THE CORPORATION OF THE COUNTY OF BRANT
Anne E.Spafford/Jennifer Hunter, for the Defendants
Defendants
HEARD: 13 June, 2013
The Hon. Mr. Justice Kent
REASONS FOR RULING ON COSTS
Introduction:
[1] This court is required to fix the plaintiffs’ partial indemnity costs for a 21 day, reasonably complex, trial.
Background:
[2] On the eve of trial, the parties reached an agreement regarding the quantum of damages, $6,600,000 less any remaining statutory benefits to which the plaintiffs may have been entitled. After trial, the defendant was found 55 % liable for the plaintiffs’ injuries. The defendant has now paid the plaintiffs a net recovery of $3,420,841.74 plus post-judgment interest. Counsel for the plaintiffs seeks partial indemnity costs with fees of $676,734.45 and disbursements of $369,192.43 for a total of $1,045,926.88.
[3] By comparison, the costs outline prepared by counsel for the defendant on a partial indemnity basis indicates fees of $337,905.50 and disbursements of $156,270.96 for a total of $494,176.46.
[4] Also to be considered is the preparation for costs submissions and for attendance in court for the best part of a day.
Complexity:
[5] Counsel for the plaintiffs pursued two theories of liability and presented expert evidence in support of each. The court made no finding upon one theory, but on the other theory found in favour of the plaintiffs. I am not prepared to second guess the wisdom of plaintiffs’ counsel in pursuing two separate theories of liability, nor the expenditure of time and money to pursue both theories.
[6] The onus of proof of liability rested with the plaintiffs and it is not unreasonable to expect that the plaintiffs’ counsel will have spent more time in preparation.
[7] In order to establish that the accident was caused by inadequate signage and/or inadequate winter maintenance of roads, counsel had to engage, consult and consider the opinions of a number of experts on highly technical matters. These experts included: an engineer, James Hrycay, who not only undertook a technical accident reconstruction analysis, but also gave an expert opinion on road signage and winter maintenance standards. His opinion was based on his own consideration of a vast amount of information relating with not only to the happening of the accident itself, but also to municipal standards and practices regarding road signage and winter maintenance. In order to properly inform James Hrycay, counsel for the plaintiffs were required to examine substantial documentation and other evidence concerning applicable provincial regulations, standards and guidelines concerning road signage and winter maintenance, as well as relate the discovery evidence of the County concerning the activities of council, traffic sign coordinators, winter maintenance patrollers and snowplow drivers.
[8] The rates claimed by the plaintiffs’ counsel, arguably, reflect the experience of counsel specializing and exclusively practicing in the litigation of complex personal injury law.
[9] During the course of the 21 day trial, counsel for the plaintiffs called 17 witnesses, including 2 experts to opine on highly technical matters. The defendant, called 11 liability witnesses including 3 experts. There were 50 exhibits entered into evidence at trial, all on the issue of liability.
Offers to Settle:
[10] Neither the offer of the plaintiffs or that of the defendant trigger any consideration of costs on other than on a partial indemnity basis.
Reasonableness:
[11] In fixing costs, the objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding, rather than an amount fixed by the actual costs incurred by the successful litigant. See: Boucher et al v. Public Accounts Council 2004 14579 (ON CA), 71 O.R. (3d) 291 at para. 26 (C.A.).
[12] Counsel for the plaintiffs has asked that the court consider the costs award made by the court in Greer et al v. Kurtz and The City of Hamilton et al, an award made by Matheson, J. of this court on 20 July 2009. While the case is not dissimilar, a significant portion of the costs awarded ($655,680.00 fees, and $103,463.94 disbursements) was calculated on a substantial indemnity basis.
[13] Counsel for the plaintiffs also referred the court to the recent decision, Stephens v. Stephens, 2012 ONSC 6881. That case addresses the issue of appropriate hourly rates and a costs award to the successful party that exceeded $900,000. In Stephens, however, the unsuccessful party’s significant misbehavior was a weighty factor in the determination of the award.
[14] Counsel for the defendant points out that in Repic v. The City of Hamilton a decision of Walters, J. released 31 Oct. 2011, the costs award effectively amounted to $290,000 for fees for a trial that went 18 days. The plaintiff’s recovery in Repic, however, was reduced to $258,750.00 after apportionment of liability.
Expectations:
[15] A client such as the County of Brant (and/or its insurers), represented by experienced counsel would have been properly advised as to the magnitude of the costs award that could be imposed if it were to be found liable. It would be surprising if, having received such advice, the client might reasonably expect to have an award made against it in an amount that exceeded $1,000,000. Nevertheless, an award that totaled in excess of $500,000 would not be outside the realm of reasonable expectation.
Analysis:
[16] I am satisfied that the plaintiffs’ counsel did the work it seeks to be compensated for and incurred responsibility for the disbursements it claims. The question is, should an unsuccessful defendant have to pay for all of the work and all of the disbursements, even on a partial indemnity basis. The answer is no. The reason for that answer is that the amount worked and the amount spent is beyond any reasonable expectation of a properly advised client-defendant who is ultimately unsuccessful in the litigation.
[17] The amount spent on experts is excessive as are the amounts spent on investigation, photography, and photocopying. Any disbursements beyond a total of $200,000 are beyond any reasonable expectation.
[18] The fees too are beyond any reasonable expectation. On a partial indemnity basis, an unsuccessful defendant should not reasonably be expecting to pay more than $406,000.
[19] Counsel decide what needs to be done to present the strongest possible case. When that decision leads to the effort and expenses of plaintiffs’ counsel in this case, the unsuccessful defendant cannot be required to indemnify, even on a partial indemnity consideration.
Result:
[20] Considering all of the foregoing, this court is unable to make the award sought on behalf of the plaintiff. A more reasonable approach results in costs fixed in the amount of $406,000 for fees and $200,000 for disbursements, exclusive of appropriate taxes, payable by the defendant to the plaintiff forthwith.
Ruling accordingly.
KENT, J.
Released: 25 June, 2013
COURT FILE NO.: CV-07-184
DATE: 2013/06/25
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
JESSE FERGUSON, SHERRY FERGUSON, MARK FERGUSON and TYLER FERGUSON by his Litigation Guardian, Sherry Ferguson
Plaintiffs
- and -
THE CORPORATIONOF THE COUNTY OF BRANT
Defendants
REASONS FOR RULING ON COSTS
KENT, J.
Released: 25 June, 2013