BARRIE COURT FILE NO.: CV-09-1532

DATE: 20131213

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: JAMES LONGO and MOLLY LONGO and DINO DELUCA and GRANT VOGELI and CELIA MARTIN, MARTIN JOHNSON and GEOFFREY GOAD, Plaintiffs/Responding Parties

AND:

MACLAREN ART CENTRE INC., Defendant/Moving Party

BEFORE: THE HON. MR. JUSTICE G.P. DiTOMASO

COUNSEL:
J. Adair, Counsel for the Plaintiffs/Responding Parties

A. Schwisberg, Counsel for the Defendant/Moving Party

HEARD: by written submissions

ENDORSEMENT ON COSTS

THE PROCEEDINGS

[1] The Defendant MacLaren Art Centre Inc. (“MacLaren”) successfully brought a motion for summary judgment. See my Reasons for Decision dated November 6, 2013. The parties agreed that costs would be determined by way of written submissions. Also at issue are the costs on the Plaintiffs’ Motion for Directions heard by me on January 9, 2013. My reasons on the return of that motion can be found in the Plaintiffs’ Responding Costs Submissions at Tab 4. This decision on costs relates to both matters.

COSTS ON THE PLAINTIFFS’ MOTION FOR DIRECTIONS HEARD JANUARY 9, 2013

[2] The Plaintiffs brought a motion pursuant to rule 34.14 of the Rules of Civil Procedure. They claim the sum of $22,897 plus HST in respect of that motion.

[3] MacLaren submits that all costs should follow the cause, and in particular, those costs associated with the Plaintiffs’ procedural motion. MacLaren seeks substantial indemnity costs regarding the procedural motion.

[4] Both the Plaintiffs’ procedural motion and MacLaren’s summary judgment motion were returnable before me on January 9, 2013. MacLaren wished to proceed with its summary judgment motion at that time. The Plaintiffs sought to adjourn the summary judgment motion and also sought directions regarding the further progress of this litigation. The summary judgment motion was adjourned. Further directions were given by me which were focused on putting this matter on course so that the motion for summary judgment could properly be heard. To do so required the opportunity for counsel for the Plaintiffs to conduct fulsome and complete cross-examinations.

[5] In my Reasons dated January 9, 2013, I identified the three issues in respect of Ms. Fynbo’s cross-examination that the Plaintiffs were entitled to explore. There could also be other areas for cross-examination not so identified.

[6] I note from my Reasons the following:

I am not prepared to parse and analyze on this motion for directions and contested adjournment each and every question asked and objected to. Suffice it to say that on the return of the cross-examination, the parties should not be arguing over questions that once again delay or derail the process or are technical in nature. That having been said, the parties should still be able to assert reasons for asking certain questions and reasons for objection.

[7] I went on to grant the Plaintiffs’ motion adjourning MacLaren’s motion for summary judgment. I also went on to order scheduling and timetabling matters.

[8] As for costs, they were to be determined by the judge hearing the motion for summary judgment which ultimately was myself.

[9] I find that on the January 9, 2013 attendance, the Plaintiffs were the successful parties. In the end, MacLaren’s motion for summary judgment was adjourned and the Plaintiffs obtained an order putting the cross-examination of Ms. Fynbo (and other cross-examinations) back on track.

Entitlement

[10] Accordingly, costs follow the event.

Quantum

[11] The amount claimed for costs by the Plaintiffs in the amount of $22,897 plus HST in respect of the rule 34.14 motion is excessive. Also included is a claim for costs associated with MacLaren’s motion for summary judgment. The Plaintiffs are not entitled to those costs.

[12] Rather, in respect of quantum, the Plaintiffs are entitled to costs on a partial indemnity scale. Although I acknowledge that considerable time and expense was involved in the preparation of the rule 34.14 motion, the procedural motion was not determined on hearing full argument in respect of each and every point raised by the Plaintiffs.

[13] That having been said, the Plaintiffs were still the successful parties on the motion.

[14] In determining the quantum of costs regarding this procedural motion, I am guided by the principles of fairness, reasonableness and proportionality.[^1] I have discounted any time associated with the summary judgment motion. I exercise my discretion and fix costs in respect of the rule 34.14 motion in the amount of $10,000 all inclusive payable by MacLaren to the Plaintiffs Dino Deluca and Grant Vogeli. This amount will be set off from an amount for costs owed by Mr. Deluca and Mr. Vogeli to MacLaren regarding the costs which I have fixed in respect of the motion for summary judgment. Those reasons follow.

[15] I consider the amount of $10,000 all inclusive to be fair, reasonable and proportional given the issues, review of submissions, consideration of the Plaintiff’s draft bill of costs, dockets and my January 9, 2013 Endorsement.

COSTS ON THE MOTION FOR SUMMARY JUDGMENT

Entitlement

[16] MacLaren was entirely successful in his motion for summary judgment against the Plaintiffs Deluca and Vogeli. Costs shall follow the event.

Quantum

Position of Deluca and Vogeli

[17] The Plaintiffs Deluca and Vogeli submit that the costs sought by MacLaren are excessively high and out of all proportion to the parties’ reasonable expectations.

[18] In the Plaintiffs’ Responding Costs Submissions, five reasons are identified why MacLaren’s Bill of Costs should be subject to a substantial reduction. Those Reasons are identified as follows:

(1) the hours claimed by counsel for MacLaren are excessive;

(2) counsel for MacLaren has included a variety of work that is not properly the responsibility of the Plaintiffs, i.e. speaking to reporters;

(3) on several occasions, there is a claim for work that ought to have been undertaken by a law clerk or legal assistant;

(4) the Plaintiffs should not be entitled to their costs of the January 9, 2013 attendance on the rule 34.14 motion for directions. (I have already dealt with that issue and MacLaren’s costs in respect of the rule 34.14 motion have been disallowed); and

(5) the rate sought by counsel for MacLaren is excessive because the experience level of said counsel is not commensurate with what was at stake in the litigation.

[19] For all of these Reasons, the Plaintiffs Deluca and Vogeli submit that the amount claimed by MacLaren is excessive and disproportionate. Rather, these Plaintiffs seek an order for costs in the amount of $50,000 for fees plus $13,000 for disbursements for a total of $63,000 plus HST for a total award of $71,190. It is submitted that the said amount would be an appropriate award of costs for a proceeding of this magnitude and complexity.

Position of MacLaren

[20] On behalf of MacLaren, it is submitted that the summary judgment motion involved complex considerations of fact and touched upon the laws of limitations, agency, negligence and evidence. In the Costs Outline submitted on behalf of MacLaren, counsel made reference to the factors set out in subrule 57.01(1). It is clear that the summary judgment motion sought dismissal of the action on a final basis which was of concern to both parties.

[21] It was submitted that the conduct of the Plaintiffs Deluca and Vogeli visited costs unnecessarily in a number of areas on MacLaren. I note that there were issues arising out of the breakdown of timetabling. I do not intend here to attribute fault to one side or the other in connection with whose conduct caused problems in advancing this litigation. Suffice it to say that there were numerous cross-examinations involving multiple parties who were not all located in the same jurisdiction. The conduct of the cross-examinations did not run smoothly. However, in any event, those cross-examinations were completed and it took time and effort on the part of the Plaintiffs Deluca and Vogeli and MacLaren to achieve the end result.

[22] Further, MacLaren submits that it served an Offer to Settle dated June 27, 2012 which is more favourable than the judgment achieved. Accordingly, MacLaren seeks under Alternative Two, partial indemnity fees with HST on a partial indemnity scale to June 27, 2012 and substantial indemnity scale thereafter with disbursements and HST in the amount of $213,404.99.

[23] In respect of Alternative One, based solely on a partial indemnity scale, the total for fees, disbursements and HST claimed is in the amount of $155,468.19.

[24] As for the rates sought for costs and the rate actually charged for counsel for MacLaren, the sum of $350 per hour is sought for fees on a partial indemnity scale and the sum of $490 per hour sought for fees on a substantial indemnity scale. The latter rate is the amount actually charged to the client.

[25] In addition to reviewing the costs outline admitted by MacLaren with attachments, I have also reviewed MacLaren’s half page reply submissions.

[26] Again, I am guided by the principles of fairness, reasonableness and proportionality in determining what is appropriate in fixing MacLaren’s costs associated with the motion for summary judgment, see Davis, supra.

[27] I have taken into account the five reasons submitted by counsel for Deluca and Vogeli. While there is merit to all of the submissions made, there is no doubt that this litigation was complex, dealing with broad ranging issues and expensive. The submissions by each counsel on the motion for summary judgment reflected considerable time and effort involved in this litigation. The arguments were well-presented by both counsel. The materials submitted by both counsel were well-drafted and of assistance to the court. Given the issues involved, each side was well-prepared and did the utmost to advance the cause of their clients.

[28] I make these remarks to place in context the quantum for costs which each side contends regarding the motion for summary judgment. These costs are high. These are costs are significant. I appreciate why the costs claimed are as high and significant as they are.

[29] Nevertheless, it falls upon me to decide, again, what is fair, reasonable and proportional when presented with these claims for costs, i.e. Alternative One and Alternative Two by MacLaren.

[30] I find that it was certainly within the expectation of the parties that the costs would be high and significant in this matter given the context, issues and procedural matters which combined to make this litigation protracted and expensive.

[31] I find that MacLaren is entitled to costs on a partial indemnity scale throughout which is Alternative One. The Offer to Settle dated June 27, 2012 was never accepted by Mr. Deluca and Mr. Vogeli.

[32] As evidenced by my Reasons of January 9, 2013, it was necessary that the parties complete cross-examinations and, in particular, the cross-examination by the Plaintiffs of Ms. Fynbo in order to have a proper hearing of the motion for summary judgment. There were other cross-examinations that required completion in accordance with the timetable submitted by the parties. I am not persuaded that MacLaren is entitled to costs on a substantial indemnity scale in accordance with the Offer to Settle dated June 27, 2012. The preferred alternative is Alternative One.

[33] That being said, the question then becomes whether MacLaren is entitled to partial indemnity costs totalling the sum of $155,468.19.

[34] That amount is broken down as follows:

Fees $123,287.50

HST (13% $ 16,027.38

Disbursements with HST $ 16,153.32

TOTAL $155,468.20

[35] I have discounted the fees recognizing the five points advanced on behalf of the Plaintiffs. I have also discounted time in respect of the rule 34.14 motion. In doing so, I take no issue in respect of the partial indemnity rate claimed by counsel for MacLaren in the amount of $350.

[36] I find that the fees are excessive in the amount of $123,287.50. I reduce those fees by $23,287.50 leaving a subtotal for fees in the amount of $100,000. I see no basis upon which to discount disbursements which I fix at $16,153.32.

[37] Having reviewed all of the appropriate principles and submissions, I exercise my discretion to fix the total amount of costs, taking into account the discount for fees, in the amount of $129,153.32.

[38] I have set off the sum of $10,000 owed by MacLaren to the Plaintiffs in respect of the rule 34.14 motion thereby reducing the sum of $129,153.32 by $10,000. The bottom line figure owed by the Plaintiffs Deluca and Vogeli to MacLaren for costs is the sum of $119,153.32 all inclusive.

[39] After I arrived at this figure, I opened the sealed envelope presented to me by counsel for MacLaren. This envelope contained the Defendant’s Offer to Settle Costs dated November 6, 2013. That Offer does not affect my decision on costs as it is less than what I ultimately determined to be the sum of $119,153.32 payable by the Plaintiffs Deluca and Vogeli to MacLaren.

DISPOSITION

[40] For the foregoing reasons, the Plaintiffs Dino Deluca and Grant Vogeli on a joint and several basis shall pay the Defendant MacLaren Art Centre Inc. the sum of $119,153.32 all inclusive for costs.

DiTOMASO J.

Date: December 13, 2013

[^1]: Davis v. Clarington (Municipality) 2009 ONCA 722 at paras. 50 - 54