ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 12-CV-452614CP
**DATE:**20140318
BETWEEN:
CASSIE HODGE
Applicant
– and –
GARY NEINSTEIN and NEINSTEIN & ASSOCIATES LLP
Respondents
Peter I. Waldmann and Andrew Stein, for the Applicant
Aaron Dantowitz and Kathrin Furniss, for The Law Foundation of Ontario
Odette Soriano and Nasha Nijhawan, for the Respondents
Proceeding under the Class Proceedings Act, 1992
HEARD: In Writing
Perell, J.
REASONS FOR DECISION - COSTS
[1] In this Application, the Applicant, Cassie Hodge, sues the Respondents, Gary Neinstein and Neinstein & Associates, in a proposed class proceeding under the Class Proceedings Act, 1992, S.O. 1992, c. 6.
[2] The certification hearing was scheduled for January 2014 but at a case management conference in December 2013, Ms. Hodge indicated that she intended to bring a motion that would have the effect of changing the evidentiary record for the motion. I cancelled the certification hearing and instead scheduled Ms. Hodge’s motion.
[3] In January 2014, Ms. Hodge brought an omnibus motion seeking a grab bag of orders; namely:
• She sought an amendment to the common issues. This request was unopposed and was granted.
• She sought an amendment to the Litigation Plan. This request was unopposed and was granted.
• She sought an amendment to the Notice of Application. I granted the amendment without prejudice to the Respondents’ rights to oppose certification.
• She sought leave to file further affidavits for the certification motion. I refused this request.
• She sought an Order requiring the Respondents to pay the costs of their re-attendance to answer refused questions. I refused this request.
• She sought answers to refusals on the re-attendance cross-examination of Greg Neinstein. I refused this request.
• She sought an Order for a subpoena duces tecum for Tony Denman of Atchison & Denman Court Reporting Services to produce the audio recording of the cross-examination of Ryszard Kolbuc. I refused this request.
• She sought an Order requiring the Respondents to comply with the Directions made by Ms. Hodge, Mr. Kolbuc, and Mr. Kupnicki that the Respondents delivery the client’s original file material with all vouchers for disbursements. I refused this request.
[4] Before the argument of the omnibus motion, Ms. Hodge abandoned requests for orders striking out the affidavit of Greg Neinstein, striking out the affidavit of Brian Greenspan, restricting the use of evidence from Mr. Greenspan’s testimony, restricting the use of evidence from Gary Neinstein’s testimony, and requiring the re-attendance of Brian Greenspan for cross-examination.
[5] With respect to costs, I concluded that Ms. Hodge had largely been unsuccessful on the omnibus motion and that her modest successes did not justify making no order for costs. I held that the Respondents were entitled to their costs.
[6] The Respondents seek substantial indemnity costs of $4,000 plus HST for the requests for relief that had been abandoned by Ms. Hodge, and they seek partial indemnity costs of $25,000 for the requests for relief that were argued. They also seek HST and disbursements of $892.25.
[7] Under rule 37.09 (3), where a motion is abandoned, a responding party is entitled to the costs of the motion unless the court orders otherwise. These costs would normally be on the partial indemnity scale but the Respondents seek costs on a substantial indemnity scale because they submit that the late arriving requests to alter the evidentiary record for the certification motion was abusive and devoid of merit and increased the costs of the litigation.
[8] With respect to the balance of Ms. Hodge’s motion, the Respondents submit that the time spent by their lawyers to prepare for and argue the motion was necessary, reasonable, and appropriate. Three lawyers were involved: Nasha Nijhawan (2010 call to the bar) docketed 64.4 hours; Odette Soriano (1995 call), who argued the motion, docketed 47.2 hours; Chris Paliare (1973 call) docketed 3.0 hours.
[9] Because the Class Proceedings Committee has approved this proceeding to receive funding from the Class Proceedings Fund, The Law Foundation of Ontario has standing to make costs submissions, and Ms. Hodge and The Law Foundation of Ontario submitted that the appropriate costs award in the circumstances of this case was $10,000, all inclusive, on a partial indemnity scale.
[10] The essential argument of Ms. Hodge and The Law Foundation is that the Respondents’ claim of more than $30,000 for the motion is excessive and beyond what is reasonable in the circumstances.
[11] Ms. Hodge and The Law Foundation also submit that there is no basis for a punitive costs award of costs on a substantial indemnity basis with respect to the abandoned requests for relief. I agree. The costs for the motion shall be on a partial indemnity basis.
[12] With respect to the alleged unreasonableness of the amount claimed by the Respondents, Ms. Hodge and The Law Foundation point out that Ms. Hodge’s bill of costs prepared for the motion, but not submitted at the hearing, was for $11,735.31. They also point out that an analysis of the Reasons for Decision reveals that Ms. Hodge was successful on several matters.
[13] In my opinion, in the case at bar, the Moving Party’s expenditure of legal resources is not a particularly helpful measure in determining what the Responding Party might reasonably be expected to incur to resist the motion.
[14] Recalling that the motion was directed at shaping the evidentiary record for the certification motion, Ms. Hodge had little to lose in bringing her motion, which sought to expand the case against the Respondents while restricting the Respondents’ evidence. However, from the Respondents’ perspective, Ms. Hodge’s motion was a serious matter because if successful, Ms. Hodge would have secured a significant tactical victory over the Respondents.
[15] It is not surprising and rather it should have been expected that the Respondents would have taken Ms. Hodge’s omnibus motion seriously, and it would have been expected that the Respondents would expend more in legal resources in resisting the motion than was expended by the moving party, Ms. Hodge.
[16] That said, there is no basis for a substantial indemnity and the claim for costs must be proportionate to the exigencies and reasonable in all the circumstances.
[17] I conclude that the appropriate costs award in the circumstances of this case is $20,000, all inclusive, payable to the Respondents within thirty days.
[18] Order accordingly.
Perell, J.
Released: March 18, 2014
COURT FILE NO.: 12-CV-452614CP
**DATE:**20140318
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
CASSIE HODGE
Applicant
‑ and ‑
GARY NEINSTEIN and NEINSTEIN & ASSOCIATES LLP
Respondents
REASONS FOR DECISION - COSTS
Perell, J.
Released: March 18, 2014