SUPERIOR COURT OF JUSTICE - ONTARIO
COURT FILE NO: CV-10-413845
DATE: 20131218
RE: Canadian Scooter Corp.
Plaintiff
- and -
The Bank of Nova Scotia
Defendant
- and Between –
The Bank of Nova Scotia
Plaintiff by Counterclaim
- and -
Canadian Scooter Corp., Ephram Chaplick, Jeremy Logan, Morey Chaplick, and David Fuss
Defendants by Counterclaim
BEFORE: The Honourable Mr. Justice Stephen E. Firestone
COUNSEL:
No One Appearing for the Plaintiff (Defendant to the Counterclaim) Canadian Scooter Corp.
Martin Sclisizzi & Kristen Riess, for the Defendant (Plaintiff by Counterclaim) The Bank of Nova Scotia
Michael Donsky, for the Defendants to the Counterclaim, Ephram Chaplick and Jeremy Logan
T.B. Carsten, for the Defendant to the Counterclaim, Morey Chaplick
Elliot Berlin, for the Defendant to the Counterclaim, David Fuss
HEARD: By way of written submissions
COSTS ENDORSEMENT
[1] On August 26, 2013 I heard and delivered oral reasons regarding various motions in this matter. At that time I indicated that the parties could make cost submissions in writing. The motions bought and my disposition regarding same can be summarized as follows:
Morey Chaplick (“M. Chaplick”), defendant by counterclaim, sought an order setting aside the minutes of settlement dated March 31, 2011 based on his alleged incapacity at the time the minutes were signed. That motion was opposed by the Bank of Nova Scotia (“the Bank”) defendant, plaintiff by counterclaim, and David Fuss (“Fuss”), defendant by counterclaim, who supported the Bank’s position. That motion was dismissed.
The Bank brought a motion for judgment against M. Chaplick pursuant to the above minutes of settlement. That motion was granted. The Bank seeks costs from M. Chaplick for the motion to set aside the minutes and its motion for judgment.
Jeremy Logan (“Logan”) and Ephram Chaplick (“E. Chaplick”), defendants by counterclaim, brought a motion to set aside the judgment of Justice McEwen dated March 7, 2013 granting judgment pursuant to the minutes of settlement dated March 31, 2011. Fuss supported the Bank’s position on the motion. That motion was dismissed.
E. Chaplick and Logan have come to an agreement with the Bank regarding the costs payable on the motion to set aside the judgment of Justice McEwen indicated above. Fuss seeks costs from E. Chaplick and Logan regarding the motion to set aside the judgment of Justice McEwen.
Motion by M. Chaplick to Set Aside Minutes of Settlement and by the Bank for Judgment against M. Chaplick
[2] The Bank seeks the sum of $64,846.00 in substantial indemnity fees and disbursements inclusive of HST.
[3] The Bank argues that there was very little medical evidence to support the position that M. Chaplick was mentally incompetent and that the motion was without merit.
[4] They argue that notwithstanding that the law to set aside a settlement due to mental incapacity is straightforward; they nonetheless had to investigate the facts giving rise to the claim of such mental capacity. This required considerable time and expense including the retainer of a psychiatrist.
[5] They also, they submit, had to review various affidavits including those from the family doctor, which enclosed letters from other medical professionals.
[6] The Bank prepared for and conducted examinations under rule 39.03 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, in addition to the cross-examinations of M. Chaplick.
[7] The Bank argues that they were required to prepare detailed submissions regarding the issue of capacity at the time the minutes of settlement were executed as well as whether the Bank had actual or constructive knowledge of the alleged incapacity.
[8] This was not, according to the Bank, a case in which minimal preparation could or should have been expected by the parties especially in light of the medical evidence.
[9] M. Chaplick argues that the amount claimed by the Bank is excessive and disproportionate to the complexity of the motion. He argues that in the circumstances of this case no costs should be awarded against him.
[10] In the alternative he argues that the costs payable should be in the sum of $4,300.00 since that was the amount the Bank agreed to with the other parties.
[11] M. Chaplick argues that this is not a case where substantial indemnity costs should be awarded. There has been no reprehensible, scandalous, or outrageous conduct or any evidence of malice or animus. Even if there was little merit to the motion, substantial indemnity costs are still not warranted.
[12] M. Chaplick highlights the fact that the Bank submitted a costs outline that reflects over 100 hours of time to prepare for and argue a motion that took less than a day.
[13] Fuss, who was not a moving party on these motions, seeks costs of $7,839.97 all-inclusive on a partial indemnity basis against M. Chaplick. He argues that his active participation on these motions was necessary given the importance to his client that the position of the Bank be supported. He points out that if the Bank was able to collect from the other defendants then he would no longer be obligated to the Bank.
[14] M. Chaplick argues that Fuss was not a moving party and did not prepare or file any affidavit materials. M. Chaplick also argues that Fuss was not a responding party to the motion and; therefore, he is not entitled to any costs because it cannot be said he was successful in opposing it.
[15] Finally M. Chaplick argues that pursuant to the terms of settlement in a matter brought by Fuss, it was agreed that E. Chaplick, M. Chaplick, and Logan would indemnify him. Therefore, Fuss had no exposure regardless of the outcome of this motion.
[16] Costs are within the discretion of the court: see Courts of Justice Act, R.S.O. 1990, c. C.43, s. 131(1). The court has broad discretion when determining the issue of costs. Rule 57.01(1) sets out the factors the court may consider when determining costs.
[17] A successful party is entitled to costs in the absence of a very good reason or reasons not to order them: see Schreiber v. Mulroney, 2007 34441 (Ont. S.C.), at para. 2.
[18] The overall objective of fixing costs is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particular circumstances, rather than an amount fixed by the actual costs incurred by the successful litigant: see Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291 (Ont. C.A.), at para. 24-26.
[19] I have considered the submissions of counsel as well as the relevant legal principles. Given the complexity of the matter, the result achieved, and the experience of counsel, I order that the Bank is entitled to partial indemnity costs from M. Chaplick in the sum of $19,900.00
[20] I further order that Fuss is not entitled to payment of any costs of these motions given that his position was in essence the same as that advanced by the Bank.
Motion by Logan and E. Chaplick to set aside Judgment of Justice McEwen
[21] Notwithstanding that the issue of costs was agreed to between Logan, E. Chaplick, and the Bank, Fuss is seeking costs from E. Chaplick and Logan for his participation on this motion in the sum of $2,772.00.
[22] Fuss was not a moving party and was in essence supporting the position of the Bank.
[23] I, therefore, order that Fuss is not entitled to any costs from Logan or E. Chaplick on this motion.
Firestone J.
DATE: December 18, 2013