COURT FILE AND PARTIES

COURT FILE NO.: CV-11-9499-00CL

DATE: 2013-10-15

SUPERIOR COURT OF JUSTICE – ONTARIO

(COMMERCIAL LIST)

IN THE MATTER OF THE BANKRUPTCY AND INSOLVENCY ACT, R.S.C. 1985, c. B-3, AS AMENDED

RE: KENNETH M. KRYS AND EDMUND RAHMING, IN THEIR CAPACITY AS JOINT OFFICIAL LIQUIDATORS, Applicants

AND:

MONTAQUE CAPITAL PARTNERS LIMITED, Respondent

BEFORE: MORAWETZ J.

COUNSEL:

James Renihan, for the Applicants

Alex MacFarlane, E. Patrick Shea and Frank Lamie, for MIS Consulting Inc.

Nigel Campbell and Pamela Huff, for Macquarie Private Wealth Inc.

Leonard Levencrown, for Ms. Gertrude Bacal

COSTS ENDORSEMENT

[1] This Costs Endorsement relates to a motion brought by Ms. Gertrude Bacal which was dismissed for oral reasons on March 20, 2013.

[2] The Joint Liquidators are awarded costs in responding to the motion brought by Ms. Bacal.

[3] Counsel to the Joint Liquidators submits that this a case for costs on a substantial-indemnity basis. The Joint Liquidators take the position that the proposed claim of Ms. Bacal was found to be frivolous and vexatious.

[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] It seems to me that although Ms. Bacal was unsuccessful on the motion, her conduct does not merit disapproval or sanction by the court. There was a degree of confusion that surrounded these proceedings not only on this motion but on a subsequent motion reported at 2013 ONSC 1756. There are open issues as to who is entitled to certain assets, both in Canada and the Commonwealth of The Bahamas.

[6] This confused state of affairs was referenced by Mr. Levencrown and, although he was unsuccessful in the ultimate result, it cannot be said that the conduct of Ms. Bacal is such that merits disapproval or sanction by the court.

[7] Accordingly, costs are awarded on a partial-indemnity basis. Counsel to the Joint Liquidators requests an award in the amount of $10,888.86, inclusive of disbursements and taxes.

[8] Mr. Levencrown failed to make any submissions, despite having requested an extension of time (see correspondence of May 2, 2013).

[9] 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.

[10] In my view, this was a straight forward motion. The Joint Liquidators utilized the services of two lawyers. It seems to me that this matter could have been addressed by only one counsel. I consider the involvement of a second lawyer to be excessive.

[11] In these circumstances, there should be a reduction in the amount claimed by counsel to the Joint Liquidators.

[12] Having considered the factors and principles noted above, I consider that an award in the amount of $5,500 inclusive of disbursements and HST is appropriate. This award is, in my view, a fair and reasonable outcome for the unsuccessful party.

MORAWETZ J.

Date: October 15, 2013