ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: CV-04-0193
DATE: 2013-12-31
B E T W E E N:
Bearskin Lake First Nation and Chief Rodney McKay a Member of Bearskin First Nation on His Own Behalf, and on Behalf of the Members of Bearskin Lake First Nation,
Peter T. Hollinger, for the Plaintiffs
Plaintiffs
- and -
Paul’s Hauling Ltd., Estate of Roy McKee, Wasaya Petroleum Limited Partnership and L.T.L. Contracting Ltd.,
Alex W. Demeo, for the Defendants Paul’s Hauling Ltd. and Estate of Roy McKee
Defendants
HEARD: Via written submissions
Mr. Justice D. C. Shaw
Decision On Costs
[1] This is a decision on the costs of a motion brought by the defendants, Paul’s Hauling Ltd. and the Estate of Roy McKee (hereinafter collectively referred to as “Paul’s Hauling”) for an order that the plaintiffs provide a sworn and certified further and better Supplementary Affidavit of Documents, listing all relevant documents, and for an order to produce for cross-examination on that Supplementary Affidavit of Documents, Robert Kamenawatamin, who was named as the deponent on one sworn and four unsworn Affidavits of Documents that have been served by the plaintiffs.
[2] The statement of claim in this action was issued on March 18, 2004. The plaintiffs claim damages for an alleged fuel spill in March 2002 at the bulk fuel depot located on Bearskin Lake First Nation.
[3] The plaintiffs have provided the following Affidavits of Documents:
(a) sworn Affidavit of Documents of Roy Brown, dated November 22, 2005;
(b) sworn Updated Affidavit of Documents of Rodney McKay, dated August 8, 2007;
(c) sworn Updated Affidavit of Documents of Robert Kamenawatamin, dated November 28, 2008;
(d) unsworn Updated Affidavit of Documents of Robert Kamenawatamin, served March 7, 2013;
(e) draft unsworn Supplementary Affidavit of Documents of Robert Kamenawatamin served April 8, 2013;
(f) draft unsworn Supplementary Affidavit of Documents of Robert Kamenawatamin served June 20, 2013;
(g) draft unsworn Supplementary Affidavit of Documents of Robert Kamenawatamin served June 25, 2013.
[4] An order was made at a case management conference on February 20, 2013, that the parties were to deliver their respective Supplementary Affidavits of Documents by March 15, 2013.
[5] Each of the unsworn Affidavits of Documents served after the order of February 20, 2013, added documents in response to requests from counsel for Paul’s Hauling for documents referred to in reports concerning contamination on Bearskin Lake First Nation and for documents that although produced in part appeared to have missing pages.
[6] As I noted in my decision on the motion, it appears that the plaintiffs have now produced the documents requested by Paul’s Hauling, albeit it took multiple requests from Paul’s Hauling and the documents were not produced until well after the March 15, 2013, deadline set out in the order of February 20, 2013. On the hearing of the motion, the plaintiffs said that they had produced some 5,260 pages of documents in response to requests from counsel for Paul’s Hauling and that they had produced all relevant and “marginally relevant” documents.
[7] I ordered that the plaintiffs were to serve a complete, sworn Supplementary Affidavit of Documents by August 30, 2013.
[8] I declined to make an order requiring Mr. Kamenawatamin to be cross-examined on the complete, sworn Supplementary Affidavit of Documents on the grounds that: (a) the documents that were requested by Paul’s Hauling were technical environmental documents about which Mr. Kamenawatamin would have little useful information; (b) there was currently no issue of withholding documents that a cross-examination might assist in resolving; and (c) the benefit to Paul’s Hauling of requiring Mr. Kamenawatamin to come from Bearskin Lake to be examined on his Supplementary Affidavit of Documents, which lists several thousand pages of technical documents, would not be proportionate to the costs of doing so.
[9] I found that Paul’s Hauling should have its partial indemnity costs of that part of the motion dealing with the production of documents on which it was successful, tempered by the success of the plaintiffs on the smaller issue of cross-examination of Mr. Kamenawatamin. I refused the submission of Paul’s Hauling that it should have its costs on a substantial indemnity basis because of what it alleged was reprehensible conduct on the part of the plaintiffs, amounting to contempt, in failing to comply with the order of February 20, 2013.
[10] Paul’s Hauling calculates its partial indemnity fees at $16,059. The fees are comprised of the following docketed hours and partial indemnity hourly rates:
Mr. Demeo – 58.2 hours x $250 = $14,550
Mr. Ratcliffe – 3.5 hours x $150 = $525
Ms. Gillespie – 12.3 hours x $80 = $984
$16,059.
[11] Mr. Demeo is a senior civil litigation counsel who has 31 years’ experience. His substantial indemnity hourly rate is $375. Mr. Ratcliffe is a junior civil litigation counsel who has 2 years’ experience. His substantial indemnity hourly rate is $225. Ms. Gillespie is a law clerk of 28 years’ experience. Her substantial indemnity rate is $125.
[12] Although Paul’s Hauling calculates its partial indemnity fees at $16,059, plus HST, it requests partial indemnity costs for this motion of $10,000, taking into account the decision on the motion and the provisions of Rule 57.
[13] The plaintiffs submit that they co-operated with Paul’s Hauling’s request to produce the documents in question. The plaintiffs state that of the 5,272 pages produced, approximately 4,888 pages were irrelevant. The plaintiffs state that they produced these documents, notwithstanding most of them were irrelevant because this was the most economical way out of the motion. The plaintiffs state that they incurred $25,905.4 of their own costs to produce mostly irrelevant material.
[14] The plaintiffs note that they were successful in avoiding the requested cross-examination of Mr. Kamenawatamin and that they were successful insofar as the court ruled against the submission of Paul’s Hauling that the plaintiffs were in contempt and therefore should be required to pay costs on a substantial indemnity basis. The plaintiffs submit that, at best, Paul’s Hauling should receive its disbursements for filing the Notice of Motion and $750 in fees.
Discussion
[15] An award of costs is a matter in the discretion of the judge by virtue of s. 131(1) of the Courts of Justice Act, which provides:
Subject to the provisions of an Act or rules of court, the costs of and incidental to a proceeding or a step in a proceeding are in the discretion of the court, and the court may determine by whom and to what extent costs shall be paid.
[16] Rule 57.01 allows the court to take into account “any other matter relevant to the question of costs.” Read in conjunction with s. 131 of the Courts of Justice Act, the court therefore has wide discretion.
[17] In Serra v. Serra (2009), 2009 ONCA 395, 66 R.F.L. (6th) 40 (Ont. C.A.), at p. 42, the Court of Appeal reiterated the fundamental purposes which modern costs rules are designed to foster, as set out in Fong v. Chan (1999), 1999 2052 (ON CA), 46 O.R. (3d) 330 (Ont. C.A.), at para. 22:
(1) to partially indemnify successful litigants for the costs of litigation;
(2) to encourage settlement; and
(3) to discourage and sanction inappropriate behaviour.
[18] In Anderson v. St. Jude Medical Inc., 2006 85158 (ON SCDC), [2006] O. J. No. 508 (Ont. Div. Ct.), at para. 22 the Divisional Court set out the principles to be applied by the court in exercising its discretion (citations omitted):
- The discretion of the court must be exercised in light of the specific facts and circumstances of the case in relation to the factors set out in Rule 57.01(1).
- A consideration of experience, rates charged and hours spent is appropriate, but is subject to the overriding principle of reasonableness as applied to the factual matrix of the particular case. The quantum should reflect an amount the court considers to be fair and reasonable rather than any exact measure of the actual costs to the successful litigant.
- The reasonable expectation of the unsuccessful party is one of the factors to be considered in determining an amount that is fair and reasonable: Rule 57.01(1)(O.b).
- The court should seek to avoid inconsistency with comparable awards in other cases. “Like cases [if they can be found], should conclude with like substantive results.”
- The court should seek to balance the indemnity principle with the fundamental objective of access to justice.
[19] The Court of Appeal has made it clear that in assessing costs, the overriding principle is one of reasonableness, and that the failure to follow that principle can produce a result that is contrary to the fundamental objective of access to justice (Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291 (Ont. C.A.), at p. 302.
[20] In Zesta Engineering Ltd. v. Cloutier, 2002 25577 (ON CA), [2002] O.J. No. 4495 (Ont. C.A.), at para. 4 the Court of Appeal did not make a specific finding with respect to the amount of time spent or the rates charged by counsel, and stated:
“In our view, the costs award should reflect more what the court views as a fair and reasonable amount that should be paid by the unsuccessful party rather than any exact measure of the actual costs of the successful litigant.”
[21] Rule 57.01(1) of the Rules of Civil Procedure provides:
“57.01 (1) Factors in discretion - In exercising its discretion under section 131 of the Courts of Justice Act to award costs, the court may consider, in addition to the result in the proceeding and any offer to settle or to contribute made in writing,
(0.a) the principle of indemnity, including, where applicable, the experience of the lawyer for the party entitled to the costs as well as the rates charged and the hours spent by that lawyer;
(0.b) the amount of costs that an unsuccessful party could reasonably expect to pay in relation to the step in the proceeding for which costs are being fixed;
(a) the amount claimed and the amount recovered in the proceeding;
(b) the apportionment of liability;
(c) the complexity of the proceeding;
(d) the importance of the issues;
(e) the conduct on any party that tended to shorten or lengthen unnecessarily the duration of the proceeding;
(f) whether any step in the proceeding was,
(i) improper, vexatious or unnecessary, or
(ii) taken through negligence, mistake or excessive caution;
(g) a party’s denial of or refusal to admit anything that should have been admitted;
(h) whether it is appropriate to award any costs or more than one set of costs where a party,
(i) commenced separate proceedings for claims that should have been made in one proceeding; or
(ii) in defending a proceeding separated unnecessarily from another party in the same interest or defended by a different solicitor; and
(i) any other matter relevant to the question of costs.”
[22] Rule 1.04 (1.1) of the Rules of Civil Procedure provides:
1.04 (1.1) In applying these rules, the court shall make orders and give directions that are proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding.
[23] The plaintiffs failed to comply with the order of February 20, 2013. As noted in my decision on the motion, the large number of new documents produced by the plaintiffs after the March 15, 2013, deadline set out in the order came only after Paul’s Hauling brought this motion.
[24] Although in its submissions on costs, the plaintiffs described the bulk of their new productions as “irrelevant”, on the hearing of the motion, plaintiffs’ counsel said that the plaintiffs had now produced “all relevant and marginally relevant documents”.
[25] Firstly, counsel should not produce irrelevant documents. If documents are produced, one is entitled to assume that counsel has complied with the obligation imposed by the Rules to produce documents relevant to any matter in issue in the action. Secondly, documents that are relevant at the margins are nevertheless relevant. Thirdly, the documents in question, inter alia, relate to pre-existing contamination, they include pages missing from prior productions, they include documents referred to by the plaintiffs’ experts and they relate to costs incurred in remediation. Prima facie, these would appear to be relevant documents, whether or not they will be introduced as evidence at trial.
[26] I am satisfied that the partial indemnity hourly rates set out respectively for Mr. Demeo, Mr. Ratcliffe and Ms. Gillespie are reasonable for their levels of experience.
[27] I accept the submission of Paul’s Hauling that the matter was made more complex because the plaintiffs provided five sworn and unsworn Affidavits of Documents, which resulted in cross-referencing and re-indexing to determine what new documents were being produced and what was missing.
[28] The plaintiffs have produced their own Bill of Costs, showing that they spent $25,905.04 to comply with Paul’s Hauling’s requests for documents. This speaks to the complexity of the matter. It should also have given the plaintiffs some indication of the amount of costs that they could reasonably expect to pay, as unsuccessful parties, in a motion for productions brought about by their failure to comply with the February 20, 2013, order.
[29] In my decision on the motion, I held that although the failure of the plaintiffs to comply with the order of February 20, 2013, did not amount to contempt, the failure to comply was a factor to be taken into account under rule 57.01(1) in assessing the question of partial indemnity costs in this case. The failure to comply unnecessarily lengthened this proceeding. It also should not have been necessary for Paul’s Hauling to have brought the motion to enforce the order.
[30] The plaintiffs were successful on the issue of cross-examination of Mr. Kamenawatamin and on the issue of contempt related to substantial indemnity costs. These issues took up the bulk of the oral submissions on the motion because, as of the hearing of the motion, the plaintiffs had produced the documents in question. Plaintiffs’ counsel shows docketed time of three hours for attendance on the motion on July 3, 2013. The Bill of Costs of Paul’s Hauling includes time on the two issues on which the plaintiffs were successful. Paul’s Hauling should not benefit from the time spent by its counsel on preparation for the issues on which the plaintiffs were successful. Additionally, the plaintiffs should receive credit for the time they incurred on the issues on which they were successful.
[31] It is not possible, from a review of the parties’ respective Bill of Costs, to precisely break down the times spent on each issue. Rather, the approach must be on a general basis, taking into account the factors outlined above.
[32] In my view, it would be fair and reasonable to award Paul’s Hauling costs of the motion in the sum of $5,250, plus HST, plus disbursements of $127, inclusive of HST.
[33] In light of the fact that the trial of this action is scheduled to begin in less than three months, for an estimated four weeks, the costs as fixed herein shall be payable at the conclusion of the trial.
___”original signed by”
The Hon. Mr. Justice D. C. Shaw
Released: December 31, 2013
COURT FILE NO.: CV-04-0193
DATE: 2013-12-31
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Bearskin Lake First Nation and Chief Rodney McKay a Member of Bearskin First Nation on His Own Behalf, and on Behalf of the Members of Bearskin Lake First Nation
Plaintiffs
- and –
Paul’s Hauling Ltd., Estate of Roy McKee, Wasaya Petroleum Limited Partnership and L.T.L. Contracting Ltd.,
Respondents
DECISION ON COSTS
Shaw J.
Released: December 31, 2013
/mls