ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N:

Daniel Sagan

Jessica Harrison, for the Respondent/Plaintiff

Plaintiff

• and -

Dominion of Canada General Insurance Company

Joyce Tam, for the Applicant/Defendant

Defendant

HEARD: in Hamilton December 3, 2013

COSTS ENDORSEMENT

[1] The Dominion of Canada General Insurance Company claims costs with respect to a motion for summary judgment heard December 3, 2013, on which they were successful in having the action dismissed. The action arose from a motor vehicle accident which occurred March 1, 2008. The plaintiff was claiming for non-earner benefits and for mental distress and extra contractual damages. The plaintiff’s statement of claim contained a litany of unsupported allegations of bad faith, misconduct and incompetence against the defendant. The plaintiff did not provide any evidence to support those allegations and maintained the claim for extra contractual damages right up to the hearing of the motion for summary judgment.

[2] Counsel for the plaintiff argues that the allegations made were serious and prejudicial and that asserting unfounded allegations of such a nature should be discouraged by the award of substantial indemnity costs.

[3] The jurisprudence has held that substantial indemnity costs may be appropriate where a party makes empty bad faith allegations. The purpose of this consequence is to diminish frivolous and speculative litigation, to cause litigants to focus on the real issues, and to foster sober reflection above that of an emotional response.

Lamie v. Belair Insurance Co., 2002 CarswellONT 4269, at paragraph 132.

DiBattista v. Wawanesa Mutual Insurance Co., 2005 CarswellONT 6604, at paragraph 5.

McNaughton Automotive Ltd. v. Cooperators General Insurance Co., 2005 CarswellONT 212, at paragraph 18.

[4] I am satisfied that a penalty of substantial indemnity costs is appropriate in this case but that it should be limited to the costs of attending on the hearing of the motion. So far as the quantum of costs is concerned, I’ve considered the factors set out in subrule 57.01(1) and have come to the conclusion that while the hourly rates claimed are reasonable, the number of hours claimed is disproportionately high. The defendant has claimed the equivalent of 12 working days in preparation for this motion which is in my view unreasonable. Another of the factors to be considered is what an opposing party might reasonably expect to be awarded in costs should they be unsuccessful.

[5] I find that the defendant is entitled to partial indemnity costs up to the hearing of the motion, and substantial indemnity costs as claimed for the day of the hearing. I fix such costs in the amount of $8,600 plus H.S.T. in the amount of $1,118, for a total of $9,718 for fees, plus $779.88 for disbursements, plus $84.87 H.S.T, resulting in a total sum of $10,582.75.

Released: April 9, 2014

LOFCHIK J.