ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: 07-31578
DATE: 2013-12-04

B E T W E E N:

Michelle Blake

Lou Ferro, Jordan Palmers and
S. Oostdyk for the Plaintiff

Plaintiff

• and -

Dominion of Canada General Insurance Co.

Lisa C. Pool and Lisa K. Van Arnhem, for the Defendant

Defendant

WHITTEN J.

COSTS JUDGMENT

1Judgment in this matter was released September 30^th, 2013.¹ The judgment concluded with the invitation for counsel to exchange costs submissions. Failure to agree as to entitlement and quantum would result in submissions to the court on these issues within 60 days of the receipt of the judgment. Submissions of counsel for the defendant have been received. Counsel for the plaintiff neither responded to the bill of costs of the defendant nor made submissions to this court.

2As stated, the main issues in the assessment of costs by a court are the entitlement and quantum.

Applicable Law

Rule 49

3Rule 49.10(1) on the assumption that there is a result which is as good or better than an offer, states that there are consequences of an offer, namely, partial indemnity costs up to the time of the offer and substantial indemnity costs from the point of offer onwards unless a court orders otherwise. The latter proviso is consistent with the general discretion of the judge as referred to in s. 131(1) of the Courts of Justice Act.

Rule 57.01

4This rule enumerates a list of factors above and beyond the results which no doubt favour a particular party and any offer. This commencement in some ways underlines the importance of the making of an offer. An offer is made to avoid the necessity of a trial and as such requires an appreciation of the relative risks or the risk of failure and/or the challenges each side faces. Canadians are aware of the expenses associated with litigation, an expense that is necessary to achieve a particular result. Because costs can eclipse the result obtained, by necessity there must be a risk appreciation engaged in by the parties and for those with counsel with the advice and direction of their counsel.

5Rule 57.01 evolves into a consideration of several factors, the amount claimed and the amount recovered, the complexity of the issues and the importance of the issues. There is also consideration of the litigation comportment, i.e. behaviour which tends to shorten or lengthen a proceeding. Obviously such a factor seeks efficiency in the use of extremely expensive resources. Litigation efficiency does not tolerate improper, vexatious and unnecessary behaviour, or for that matter negligent behaviour.

6This recognition of the need for efficiency again invariably focuses on the risk appreciation referred to above. Counsel representing a plaintiff in the context of the accident benefit regime has a duty to inform the client of the particular risks associated with their claim. In this matter counsel would no doubt have told Mrs. Blake of the possibility of her being statute barred. This is not an inconsequential risk as she faced the emotional demands of testifying and being a person of modest means. The costs judgment could not be satisfied by her in her lifetime without a major lottery win.

7Counsel will no doubt review her prior medical history with her as it would be inevitable that opposing counsel would seek to draw out similarities with what she experienced before as an explanation for symptoms proffered post-accident, to obtain benefits.

8Counsel would no doubt advise the client that claims of bad faith on the part of the defendant’s adjustors, although not as damming as fraud claims should not be made lightly as they could generate a responsive zeal by a company sensitive to its public image.

9Independent of the advice a party could expect of its counsel in matters of risk appreciation, a party is entitled to counsel cognizant of the rules of evidence and the current rules of practice, in particular Rule 53.03 as to the structure and content of the expert reports.

Application

10The offer made by the defendant before trial was quite fair for a suit with a significant flaw, namely the limitation issue. Given this offer the presumptive regime of partial and substantial indemnity costs comes in to play, governed of course by the discretion of the court. It is impossible to avoid the sympathetic situation of the plaintiff, a recipient of long-term disability benefits but sympathy cannot eclipse the liability for costs, especially so when the plaintiff was represented by experience counsel. The latter’s advice would be part of the bullwark against the unjust imposition of costs. Counsel would advise the plaintiff as to the costs of her access to justice. There is no compelling reason to not give the defendant its costs as assessed by the court.

Quantum

11The bill of costs submitted by counsel for the defendant is based on the number of hours incurred by various counsel and legal support staff. It is trite to say that the time consumed is the foundation of a legal bill.

12The law profession is not unique in this regard. Other professions and trades do bill so as well. We are all accustomed to receiving dental bills based on time consumed. Bills from our automobile technician are similarly based. The invoice is reviewed and one notes that an extraction or filling was carried out or your brakes were repaired. All time based accounts must have a description of the activity performed, otherwise the consumer has no basis of personally assessing the reasonableness of the account. The more description the better. In some instances a profession or trade will have a stipulated fee for a particular activity, the price is the same notwithstanding the ease the provider achieves on one occasion versus the difficulty on another. It is noted that Form 57 A suggests “In support of the claim for fees, attach copies of invoices or other evidence.” Form 57 B in its concluding columns has a column entitled “Fee Items” in which the activity engaged in by counsel is to be set out.

13The same need for description applies to legal bills. Otherwise, how can an assessing court determine if there was repetition of activity within a firm of many lawyers (the client should not be charged for the getting up to speed of a successor lawyer in the firm finding himself or herself with a file as one of the partners or associates had). How can the assessor determine if whatever counsel did on a particular day for a particular number of hours or fraction thereof was something efficient relative to the progress of the file? We would not be happy if we received a bill from a dentist or an automobile technician which spoke of “conversation with colleague”. One would invariably wonder about the topic of the conversation “was it about my case, what was achieved”. In summary, there has to be detail on a legal invoice with respect to what was done and for what reason. Regrettably there is no such description provided in the bill of costs provided by the counsel for the defendant. Given this absence the court has to rely on a general understanding of what takes place in such an action before a trial commences and what it actually observes as to the activities of counsel during the course of trial.

14Up until the time of the offer the proposed fees on a partial indemnity basis are almost $13,000. That time would encompass pleadings, productions and examinations and pre-trials. There would be invariably some preparation for trial given the proximity of the actual offer to the commencement of the trial proper. There were several counsel involved according to the bills of costs. One assumes that the two counsel who were counsel at trial were the directing force behind these pre-trial efforts. The contributions of other counsel is impossible to determine as the detail referenced above is absent. The same could be said with respect to whatever the contribution of the law clerks. For all of the above the costs of the services rendered prior to the offer are fixed at $10,000 plus HST.

15During the trial obviously the jurist’s focus is on the two counsel for the defendant. It was readily apparent that they worked as a team, each complimenting the other. As mentioned, there were motions by the plaintiff, some of which were abandoned at the courtroom door along with some of the damages sought, for example, punitive damages. The trial proceeded over 11 days in 2012. The usual amount of daily time trial counsel are “on deck” is five hours. One assumes that above and beyond the actual court attendance, there is daily preparation of at least two hours for every hour one is “on deck”. Therefore, over 11 days two counsel would dissipate 110 hours in the courtroom and at least 220 hours in preparation. The actual time claimed by the two counsel is closer to 500 hours. The post-offer bill of costs is handicapped by the same lack of detail as the extent or need for the services of other counsel and law clerks aside from the two counsel robed. Having considered all of the above the costs of services post the offer is fixed at $95000 plus HST.

16The disbursements incurred prior to June 10^th, 2010 appear reasonable and are fixed at $794.88.

17Those disbursements post June 10^th, 2010 are problematic in two areas; the photocopying of $4,432.27 and $22,000.00 for preparation, attendance and witness of Dr. Dost.

18An appreciation of the first area would have been assisted by the rate per page the firm is charging and whether there were any economies that could have been affected by outsourcing. The second area of concern is on top of the costs of Dr. Dost’s IME Report which alone cost $8,400.00. What was involved in the preparation of this expert witness? Did he have to go beyond a review of his initial report? These figures are not inconsequential. Again with detail a greater appreciation can be made beyond the overall reaction to the immensity of the bill. Considering all of the above the appropriate sum for these particular disbursements beyond July 1^st, 2010 has reduced the photocopying to $2000.00 and the preparation, attendance and witness relating to Dr. Dost to that of $12,000.

19I am confident that counsel can calculate the resulting total disbursements and coincidental HST.

20It is observed that counsel for the plaintiff did not respond to the Bills of Costs submitted by the defendant. Nor did counsel for the plaintiff make any cost submission to this court. Given this lack of response, if counsel for the defendant receives no response from counsel for the plaintiff after a week of being providing the latter with a copy of this cost judgment for the purpose of approval as to content or form, counsel for the plaintiff may submit their judgment to the court for its review.

Whitten J.