SUPERIOR COURT OF JUSTICE – ONTARIO

(COMMERCIAL LIST)

COURT FILE NO.: CV-13-10050-00CL
DATE: 20131015

Application Under the Business Corporations Act (Ontario), R.S.C. 1990, c. B.16, as amended, Section 253

RE: 1712302 ONTARIO INC., 1714970 ONTARIO INC., AND DION, DURRELL + ASSOCIATES INC., Applicants

AND:

SYLVAIN DION, JOSH ZIRIN, JASON BRAUN, DONALD CALLFAS, DORIS MCDOUGALL, TATIANA BALTSEVITCH DAVID BRAY, JEREMY JOHNSON, AND CRISTI LOMBARDI, Respondents

BEFORE: MORAWETZ J.

COUNSEL:
B. H. Bresner and E. Sinha, for the Applicants (Respondents on Motion)
R. B. Swan, for Sylvain Dion, Respondent (Moving Party on Motion)
W. E. Pepall, for Respondents except Sylvain Dion

COSTS ENDORSEMENT

[1] This Costs Endorsement relates to 1712302 Ontario Inc. v. Dion, 2013 ONSC 4962.

[2] The motion of Sylvain Dion was granted, with costs payable to Mr. Dion. Counsel for the remaining respondents did not seek costs.

[3] Mr. Dion seeks substantial indemnity costs.

[4] Substantial indemnity costs are “exceptional” and available only “in rare circumstances to signal the court’s disapproval of a party’s outrageous conduct during litigation” (See Prinzo v. Baycrest Centre for Geriatric Care, 2002 4505 at p. 76 (Ont. C.A.) and Casboro Industries Limited v. Royal Composites Co., 2010 ONSC 1871 at p. 30.

[5] In my view, the conduct of DDA does not warrant such a sanction. Costs are awarded on a partial-indemnity basis.

[6] The costs submissions of Mr. Dion on a partial-indemnity basis total $23,983.31, including disbursements and HST.

[7] DDA takes the position that the amount claimed by Mr. Dion is excessive and appears to reflect a duplication of effort and “learning time” by Mr. Dion’s counsel.

[8] Counsel for DDA points out that a number of counsel have been involved on behalf of Mr. Dion. One of the lawyers involved in the proceeding has left Bennett Jones LLP, at which point Mr. Swan assumed carriage of the file. That was not the only change. Mr. Bell was also newly engaged on the file. DDA takes the position that both the senior and junior lawyer had to get up to speed and that DDA should not be expected to have to pay the costs associated with this change of counsel.

[9] I agree with the position taken by DDA. Further, I accept that the replacement of counsel resulted in a duplication of effort and “learning time”.

[10] I have considered the submissions filed by the parties and I have also taken into account the facts enumerated under Rule 57, including the time spent, the results achieved and the complexity of the matter. In addition, I have also taken into account the principles set forth by the Court of Appeal in Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3rd) 291 (C.A.), specifically that the overall objective of fixing costs is to fix an amount that is fair and reasonable for an unsuccessful party to pay in the particular circumstances, rather than an amount fixed by actual costs incurred by the successful litigant.

[11] In my view, the duplication of effort and “learning time” is such that there should be a reduction in the amount claimed.

[12] Taking into account the factors and principles set out above, a costs award is in the amount of $15,000, inclusive of disbursements and HST is warranted. In my view, this is a fair and reasonable outcome for the unsuccessful party.

[13] The award is in favour of Mr. Dion.

MORAWETZ J.

Date: October 15, 2013