Court File and Parties

Court File No.: C-304-04
Date: 2013-09-30

Superior Court of Justice – Ontario

RE: SEP Holdings Limited, Plaintiff

and

The Corporation of the City of Cambridge, Defendants

Before: The Honourable Mr. Justice P.J. Flynn

Counsel:
Eric K. Gillespie, Counsel for the Plaintiff
James H. Bennett, Counsel for the Defendant

Endorsement

[1] My Reasons of May 17, 2013 ought to make clear that the Defendant was completely successful in this lawsuit.

[2] While the Plaintiff claimed $3.7 million dollars in its Statement of Claim and pressed to claim for $9 million dollars until the end of trial (without any amendment of the pleadings), I found that the Plaintiff had proved no damages. This, in spite of the fact that the Defendant, from the start, admitted liability.

[3] Now the Defendant seeks costs of $498,815.97, based on partial indemnity fees from March 2004 to April 21, 2010 and substantial indemnity fees thereafter, because of the Defendant’s three Offers to Settle, any one of which the Plaintiff clearly ought to have accepted.

[4] The first of those Offers was made on April 21, 2010 and was never withdrawn.

[5] The issues involving the Plaintiff’s damages were complex because of its unsupported theory of damages, requiring extra engineering evidence and economic evidence on the liability of the phantom project.

[6] This also tended to unnecessarily lengthen the duration of the trial, despite the Plaintiff’s claims that the steps it took shortened the trial by at least one-third. Moreover, the expert witnesses formulated their opinions on the false factual foundations put in place by the Plaintiff.

[7] Over and above these concerns was the evidence of the Plaintiff’s principal witness, McCash, who misled the court and revealed in the middle of the trial that the Plaintiff had gone away from the phantom project three or more years before the trial started.

[8] While the Plaintiff’s counsel has 17 years experience, the Defendant’s counsel (Mr. Bennett after the retirement of Mr. Snyder), have 40 and 32 years of experience respectively.

[9] The Plaintiff does not dispute the amount claimed by the Defendant for disbursements. Nor does the Plaintiff dispute the time spent by Defendant’s counsel or the hourly rate claimed by them.

[10] Rather, the Plaintiff complains that the Defendant’s request for substantial indemnity costs is “disproportionate”.

[11] But the Defendant’s claim is not for substantial indemnity costs throughout – he only claims those higher costs from the date of the first Offer which the Plaintiff, in hindsight, should have accepted.

[12] It is trite to say that costs must be fair and reasonable and within the reasonable expectations of the losing party.

[13] The Plaintiff would have claimed in excess of $454,000, if successful, including almost $283,000 in disbursements. The Defendant’s claim includes $231,000 in disbursements.

[14] Given the more senior counsel on the other side and their higher hourly rate, it would have been reasonable for the Plaintiff to expect the costs claim actually made in this case.

[15] Accordingly, I fix the Defendant’s costs in the full amount it claims, namely $498,815.97 and order that it be paid by the Plaintiff to the Defendant within 30 days.

P.J. Flynn J.

Released: September 30, 2013