SUPERIOR COURT OF JUSTICE - ONTARIO

Court File No.: CV-10-395002
Date: 20130923

RE: THE MIDAS INVESTMENT CORPORATION (Plaintiff)

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THE DOMINION OF CANADA GENERAL INSURANCE COMPANY, CANADIAN INSURANCE BROKERAGES INC. and JON ELDRIDGE (Defendants)

Before: Justice Swinton

Counsel:
John Pirie, for the Plaintiff/Responding Party

Jeffrey M. McEown, for Canadian Insurance Brokerages Inc. and Jon Eldridge (Defendants/Moving Parties)

Date Heard: by written submissions

COSTS ENDORSEMENT

Overview

[1] Canadian Insurance Brokerages Inc. and Jon Eldridge (“the Defendants”) seek costs of the action, including the motion for partial summary judgment, on a substantial indemnity basis in the amount of $128,653.87 or, on a partial indemnity basis, in the amount of $98,002.87 plus HST of 13%.

[2] The Plaintiff argues that there should be no costs of either the action or the motion awarded to the Defendants. Indeed, it seeks costs of the motion for partial summary judgment, which it argues was unnecessary. With respect to the action, it submits that the remaining defendant, Dominion of Canada General Insurance Company, is the party that should pay costs. In any event, the Plaintiff submits that costs of the action should be no more than $25,000.

[3] In my view, costs should follow the event, payable by the Plaintiff, as the Brokerage Defendants were successful on the motion for partial summary judgment, and the action has been dismissed against them.

Costs of the motion for partial summary judgment

[4] The Plaintiff submits that the motion for summary judgment was unnecessary, as the only remaining issue was the costs of the action. However, that is not the way in which the motion for summary judgment was argued. Rather, the Plaintiff argued that partial summary judgment should not be granted and the Defendants should remain in the action because there were genuine issues requiring a trial. In my view, the Defendants reasonably brought the motion for partial summary judgment in order to obtain a dismissal of the action against them.

[5] Accordingly, they are entitled to costs of the motion from the Plaintiff, which I would set on a partial indemnity basis. I concluded in my earlier reasons that the Plaintiff’s conduct, in bringing the Defendants into the action, did not warrant a costs sanction.

Scale of Costs

[6] I have now been given information on the various offers to settle. The Defendants made a number of offers to settle the action before the motion was argued, each time raising the amount of costs they sought, along with a dismissal of the action. Prior to the motion being heard, the Plaintiff’s only offer was to dismiss the action without any costs to the Defendants.

[7] While the Defendants made a number of efforts to settle, I remain of the view that they should have their costs on a partial indemnity basis for the action.

Costs of the Action

[8] The Defendants have filed a costs outline respecting the whole action, while the Plaintiff has filed a costs outline dealing only with the costs of the motion for summary judgment. It claimed $29,840.37 in substantial indemnity costs for that motion.

[9] In my view, $15,000 is a reasonable amount for the costs of the motion, plus HST. This was not a lengthy motion for summary judgment. The hours spent by each party’s counsel are about the same, and the Plaintiff, as losing party, would reasonably expect to pay such costs, given the issues on the motion and their own legal fees.

[10] With respect to other steps in the action, I note that the Defendants prepared pleadings and provided an affidavit of documents. There were discoveries followed by answers to undertakings. As well, there was an unsuccessful mediation. The Defendants should receive costs for those steps in the proceeding.

[11] With respect to the first summary judgment motion determined by Corrick J., these Defendants took a very limited role, and they did not seek costs of the motion. Corrick J. awarded costs of $54,000 to the Plaintiff, payable by Dominion. In my view, it is not appropriate for the Defendants to now seek costs against the Plaintiff for that motion.

[12] With respect to the dispute between the Plaintiff and Dominion about the amount of insurance coverage, the Defendants state that they kept costs down by maintaining a watching brief. In my view, the almost 100 hours in the costs outline for this stage of the action seem excessive, given the more passive role adopted, and I would reduce the amount of costs awarded as a result.

[13] I would award a further $45,000 for the costs of the action, in addition to the costs of the motion. This, again, is a fair and reasonable amount, given the steps in the proceeding and the level of the Defendants’ involvement.

[14] Accordingly, I order costs to the Defendants Canadian Insurance Brokerages Inc. and Jon Eldridge in the amount of $60,000 plus HST for fees and $5,249.87 for disbursements, payable by the Plaintiff.

Swinton J.

Released: September 23, 2013