ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: CV-12-462652

DATE: 20130806

B E T W E E N :

KATHRYN SULLIVAN

Plaintiff

– and –

FOUR SEASONS HOTELS LIMITED carrying on business as FOUR SEASONS HOTELS & RESORTS, 2066751 ONTARIO LIMITED carrying on business as FOUR SEASONS HOTEL, KINGDON HOTELS (TORONTO) LTD. Carrying on business as FOUR SEASONS HOTEL, TORONTO, FOUR SEASONS RESORT NEVIS, FS US SERVICES LIMITED and FS US EMPLOYMENT INC.

Defendants

Albert S. Frank
for the Plaintiff

Christopher Burkett and Cherrine Chow
for the Defendants (Moving Parties)

ORDER FOR COSTS

chapnik j.:

[1] The plaintiff’s action for wrongful dismissal involves a global multi-national employer in a situation where relevant events occurred both in Ontario and in the United States.

[2] In the motion before me, the defendants sought a dismissal or stay of the action based on lack of jurisdiction or, in the alternative, the principle of forum non conveniens. The plaintiff took the position that Ontario courts have jurisdiction and no other forum is clearly more appropriate.

[3] In written reasons released July 8, 2013, I held that the court has jurisdiction to hear the matter but found, based on the principle of forum non conveniens, that New York is clearly the more appropriate forum. Accordingly, the plaintiff’s action in Ontario was permanently stayed.

[4] Costs lie in the courts’ discretion pursuant to s.131 of the Courts of Justice Act, R.S.O. 1990, c.C.43. In determining the costs to be awarded in a proceeding, the court considers all relevant factors as well as the result obtained. Some of those factors as set out in rule 57.01(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, include:

a) the amount of costs an unsuccessful party would reasonably expect to pay;

b) the complexity of the proceeding;

c) the importance of the issues;

d) whether any step in the proceeding was improper, vexatious or unnecessary;

e) any other matter relevant to the issue of costs.

[5] The defendants claim substantial success on the motion, and they have submitted a Bill of Costs seeking $41,846.38 for partial indemnity and $60,961.86 for costs on a substantial indemnity scale. The plaintiff argues that, given the novelty of the issues and the divided success of the parties, there should be no order for costs; and any award over $10,000 would be “excessive”, in the circumstances.

[6] In support of their claim for costs, the defendants contend that the matter was both complex and important given the issues of jurisdiction and foreign law. The plaintiff does not dispute this; however, the argument goes both ways. Both parties spent considerable time and effort researching the relevant law in the United States and Canada. Indeed, the issues involved in the matter of jurisdiction are particularly complex, as reflected in my reasons for judgment. As indicated, the plaintiff was successful on that issue.

[7] Both counsel emphasized the novelty of the issues raised before me. In their costs submissions, the defendants state that “the issues in this motion applied newly established legal principles outlined by the Supreme Court of Canada to a motion contesting jurisdiction and forum, providing a precedent for how such cases may be considered in the global multi-national employer context.” While agreeing with this assessment, the plaintiff opines that this simply highlights “the novelty of the issues, their significance to the administration of justice and the public benefit in having the court give a decision, such that it is not desirable to penalize one side or the other”.

[8] In support of this argument, the plaintiff relies on the decision of Master Clark in Chitel v. Rothbart (1987), 19 C.P.C. (2d) 48 (Ont. S.C.) at para. 12, where he states:

Where a point of law is truly novel there is a public benefit in having the court give a decision. That being the case, it is not desirable to penalize one side or the other ……

See also Iona Corp. v. Aurora (Town), 1991 7278 (ON SC), 1991 Carswell Ont. 675, 3 O.R. (3d) 579; Gligorevic v. McMaster, 2012 ONCA 115, 109 O.R. (3d) 321 at para. 114.

[9] The defendants raised two discrete issues in their motion materials, and the plaintiff was obliged to respond to each of them. In the end, the defendants were successful in having the plaintiff’s Ontario action stayed, a result which was clearly in their favour. On the other hand, in my view, the issue of jurisdiction simpliciter bore considerably more complexity and has wider implications than that of forum non conveniens which was based primarily on the factual context underlying the plaintiff’s claim.

[10] In these circumstances, given the novelty of the issues raised particularly that of the courts’ jurisdiction in the global multi-national employer context, and the divided success, the most fair and just result would, in my view, be to make no award of costs, and I exercise my discretion accordingly.

[11] In my view, that is the fair, reasonable and proper result in the particular and unique situation before me.

[12] However, for completeness, I will say that, had I granted costs to the defendants, I would have awarded them the all-inclusive sum of $25,000. In my view, their Bill of Costs where six lawyers, two students-at-law and two law clerks worked on the file, is excessive. There were, I understand, three “short” cross-examinations, two of which generated evidence relied on by the plaintiff in her successful argument on jurisdiction.

[13] In their submissions on costs, the defendants assert that the within motion and their claim for costs is similar to those found in the relevant case law, namely, Cannon v. Funds for Canada Foundation, [2010] O.J. No. 4374 (Ont. Sup. Ct.) and Van Breda v. Village Resorts Ltd., [2008] O.J. No. 3120 (Ont. Sup. Ct.). In both cases, where jurisdictional issues were raised, this court awarded the successful party approximately $70,000 in costs.

[14] In Cannon, the defendant who brought an unsuccessful motion to challenge the court’s jurisdiction, took no position on costs. In addition, the plaintiff was entirely successful on the motion; the issues of jurisdiction and foreign law were argued in the context of a class action involving millions of dollars; and substantial disbursements were incurred by the claimant attending in Bermuda to conduct cross-examinations and obtaining an opinion on Bermuda law.

[15] In Van Breda, the plaintiff achieved substantial success as the primary defendant lost the jurisdictional argument and the defendants’ motion to stay the action was dismissed. The motion took two full hearing days with a substantial record, evidence of experts on Cuban law, and cross-examination of a party in Vancouver, B.C.

[16] As noted, costs are in the court’s discretion pursuant to s.131 of the Courts of Justice Act. Clearly, each case turns on its own peculiar fact situation. In my view, given the divided success of the parties in this motion, the underlying wrongful dismissal action, the factors set out in rule 57.01 and the relevant case law, a fair and just assessment of costs within the reasonable expectation of the parties, would be the all-inclusive sum of $25,000.

[17] In conclusion, there will be no award of costs in this matter; however, had I awarded costs, my costs order would have been for the all-inclusive amount of $25,000 in favour of the defendants.

CHAPNIK J.

RELEASED: August 6, 2013

COURT FILE NO.: CV-12-462652

DATE: 20130806

ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N :

KATHRYN SULLIVAN

Plaintiff

– and –

FOUR SEASONS HOTELS LIMITED carrying on business as FOUR SEASONS HOTELS & RESORTS, 2066751 ONTARIO LIMITED carrying on business as FOUR SEASONS HOTEL, KINGDON HOTELS (TORONTO) LTD. Carrying on business as FOUR SEASONS HOTEL, TORONTO, FOUR SEASONS RESORT NEVIS, FS US SERVICES LIMITED and FS US EMPLOYMENT INC.

Defendants

REASONS FOR JUDGMENT

CHAPNIK J.

RELEASED: August 6, 2013