SUPERIOR COURT OF JUSTICE - ONTARIO

RE: NIKORE v. BRANT COMMUNITY HEALTHCARE SYSTEM

2014 ONSC 1613

COURT FILE NO.: CV-08-348906

BEFORE: MASTER R.A. MUIR

COUNSEL: William A. Chalmers for the plaintiff

D.H. Rogers Q.C. and Anita M. Varjacic for the defendant Brant Community Healthcare System

HEARD: March 7, 2014

ENDORSEMENT

[1] The plaintiff brings this motion pursuant to Rule 37.09(3) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (the “Rules”). The plaintiff seeks his costs of a motion brought by the defendant Brant Community Healthcare System (“Brant”). Brant’s motion sought production of certain Schedule B documents over which privilege had been claimed by the plaintiff. Brant served a notice of abandonment of the motion on April 17, 2013.

[2] Brant’s motion was served in July 2012. It consisted of two volumes of material and a 54 paragraph affidavit. The plaintiff served responding materials in September 2012. The Canadian Medical Protective Association was granted intervenor status on the motion. It served brief responding materials as well. Three cross-examinations took place. Brief supplementary records were served by Brant and the plaintiff. Detailed factums and briefs of authorities were prepared and served by all participants.

[3] Brant’s motion was partially argued on November 29, 2012 before Master McAfee. The argument could not be completed on that date. The motion was then adjourned without a date.

[4] A new return date was never established. On April 17, 2013, Brant served its notice of abandonment. Mr. Rogers submitted that the notice of abandonment was served simply because Brant wanted to get on with the substantive aspects of this proceeding.

[5] This motion seeking costs was first made returnable before me on December 9, 2013. It was not made returnable before Master McAfee despite the fact that she was obviously seized of Brant’s motion.

[6] With Master McAfee’s permission, I agreed to hear the plaintiff’s motion. The motion was then adjourned to be heard by me on January 31, 2014, in order to allow Brant an opportunity to file responding materials. The motion was adjourned once again due to the late filing of a costs outline by Brant. It was ultimately argued before me on March 7, 2014.

ENTITLEMENT TO COSTS

[7] Rule 37.09(3) reads as follows:

Where a motion is abandoned or is deemed to have been abandoned, a responding party on whom the notice of motion was served is entitled to the costs of the motion forthwith, unless the court orders otherwise.

[8] The Rule presumes a costs order will be made against a moving party who abandons a motion unless that party can persuade the court that some other costs order would be just in the circumstances. I can see no basis to deny the plaintiff his costs in the circumstances of this abandoned motion and Brant does not argue otherwise.

QUANTUM

[9] Section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43 provides that costs are in the discretion of the court. Rule 57.01(1) sets out a non-exhaustive list of factors the court is to consider when awarding costs. Rule 1.04(1.1) is also applicable. It requires the court in applying the Rules to make orders that are proportionate to the importance and complexity of the issues and to the amount involved in the proceeding.

[10] When dealing with costs, the overall objective for the court is to fix an amount that is fair and reasonable for the unsuccessful party who generally must pay the costs of the successful party. See Zesta Engineering Ltd. v. Cloutier, 2002 25577 (ON CA), [2002] O.J. No. 4495 (C.A.) at paragraph 4 and Boucher v. Public Accountants Council for the Province of Ontario, 2004 14579 (ON CA), [2004] O.J. No. 2634 (C.A.) at paragraph 26. In Clarington (Municipality) v. Blue Circle Canada Inc., 2009 ONCA 722 the Court of Appeal stated as follows at paragraph 52:

Rather than engage in a purely mathematical exercise, the judge awarding costs should reflect on what the court views as a reasonable amount that should be paid by the unsuccessful party rather than any exact measure of the actual costs of the successful litigant.

[11] I also accept the plaintiff’s submission that it is not the role of the court to second guess the time spent by counsel unless it is clearly excessive or the file has been “over lawyered”. See Basdeo v. University Health Network, [2002] O.J. No. 597 (S.C.J.) at paragraph 7.

[12] These are the factors and principles I have considered and applied in determining the appropriate quantum of costs payable by Brant in respect of its abandoned motion.

[13] I have carefully reviewed the costs outline submitted by the plaintiff. I have also considered the costs outline prepared by Brant in advance of the attendance before Master McAfee on November 29, 2012.

[14] The plaintiff seeks partial indemnity costs for the abandoned motion in the amount of $60,978.14 inclusive of disbursements and HST. The amount requested for fees alone is $56,243.49. The total number of hours spent by all timekeepers is 232.8.

[15] Brant’s partial indemnity costs outline is in the amount of $16,208.70 based on approximately 108 hours of time. However, counsel for Brant acknowledged during argument that it is reasonable that there be a significant costs order in favour of the plaintiff. He suggested costs in the $25,000.00 to $30,000.00 range would be fair and reasonable.

[16] I accept that this motion dealt with complex issues of fact and law. Many documents were in issue as were several varieties of privilege along with the issue of waiver of privilege. I also accept that this motion was of considerable importance to the plaintiff. Lawyer/Client privilege is a fundamental element of our system of justice. Its importance cannot be overstated. It was obviously very important to the plaintiff that he maintain the confidentiality of his communications with his lawyers. The seriousness of the issue is underscored by the fact that the Canadian Medical Protective Association sought and obtained leave to intervene on the motion. These factors militate in favour of a significant award of costs.

[17] However, it is also my view that some of the time claimed by the plaintiff is clearly excessive and should be reduced. I am also of the view that the partial indemnity hourly rate claimed for Mr. Chalmers (1994 call) should be $300.00 per hour and not $350.00 per hour.

[18] Mr. Chalmers and his associate Cheryl Boyd docketed a total of 127.2 hours under the categories dealing with their response to Brant’s motion, including review of responding materials and documents, legal research and preparation of a responding factum (categories 1 and 3 on the plaintiff’s costs outline). In addition, a claim is made for 49.5 hours of student time under these categories. In my view, this amount of time is clearly excessive, even accepting the complexity and importance of this motion. I note that Brant’s time for the entire motion, including cross-examinations and attendance at the one day hearing amounted to approximately 108 hours. The issues on this motion were important and complex but it was, nevertheless, an interlocutory motion with only one day of argument. In my view, there should be a 50% reduction in the amount of time spent by Mr. Chalmers, Ms. Boyd and the students at law under these categories.

[19] I also agree with Mr. Rogers that Mr. Chalmers’ partial indemnity hourly rate should be $300.00 and not $350.00. First, it was only on the morning of March 7, 2014 that Mr. Chalmers presented a costs outline seeking $350.00 per hour. The plaintiff had previously requested $300.00 per hour and the authority on which the plaintiff relied for the $350.00 rate was available to the plaintiff when the original costs outline was prepared. Second, the court should be careful not to fix an amount of costs on a partial indemnity scale that is virtually the same as a substantial indemnity costs award. See Boucher at paragraphs 35 and 36. Using a partial indemnity rate of $350.00 results in the plaintiff’s partial indemnity fees being 84% of the substantial indemnity fees requested. Using a rate of $300.00 per hour reduces that figure to 75%. In my view, this is a more appropriate ratio.

[20] Applying these considerations leads to a fee reduction to the plaintiff’s original costs outline (dated November 22, 2013) of approximately $17,000.00.

[21] I am satisfied, however, that the remaining time claimed appears to be fair and reasonable. A significant amount of time was spent in preparing for what turned out to be relatively brief cross-examinations but I accept Mr. Chalmers’ argument that extensive preparation of the plaintiff was required in order to be ready for what were potentially wide-ranging examinations on issues of great importance to the plaintiff.

[22] It is also my view that the plaintiff should be compensated for the appearance before Master McAfee on November 29, 2012. Brant argued that the appearance before Master McAfee was devoted to argument over whether certain documents should be expunged from the plaintiff’s responding material and that Brant was successful on that issue. While that may be true, I note that the issue was not dealt with as a separate motion to strike and Master McAfee made no costs order with respect to that appearance. More importantly, the only reason the plaintiff was present on that date was because Brant chose to bring this motion in the first place, which it later abandoned. The plaintiff should be entitled to his costs of that day.

[23] Finally, I do find the amount of $2,603.25 for photocopying as somewhat surprising. However, Brant did not take issue with this amount and there was obviously a great deal of paper involved with this motion.

ORDER

[24] I have therefore concluded that it is fair and reasonable for Brant to pay the plaintiff’s partial indemnity costs of the abandoned motion fixed in the amount of $33,000.00 for fees and $4,734.65 for disbursements for a total of $37,734.65. All of these amounts are inclusive of HST. These costs shall be paid within 30 days.

[25] If the parties are unable to agree on the costs of this motion, they may make brief submissions in writing by no later than April 7, 2014.

Master R.A. Muir

DATE: March 12, 2014