Ontario Superior Court of Justice
Court File No.: CV-14-117399-00
Date: 20140411
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
SOUTHLAKE REGIONAL HEALTH CENTRE
Applicant
– and –
BESWICK GROUP PROPERTIES INC.
Respondent
B. Glaspell and D. Girlando, for the Applicant
K. MacDonald, for the Respondent
HEARD: By written submissions
COURT FILE NO.: CV-13-117159-00
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
BESWICK GROUP PROPERTIES INC.
Applicant
– and –
SOUTHLAKE REGIONAL HEALTH CENTRE
Respondent
K. MacDonald, for the Applicant
B. Glaspell and D. Girlando, for the Respondent
HEARD: By written submissions
COSTS ENDORSEMENT
HEALEY J.
[1] This costs endorsement references the ruling related to the applications and motions described in the endorsement released February 27, 2014 and orders made therein (Southlake Regional Health Centre v. Beswick Group Properties Inc., 2014 ONSC 1319).
[2] Having read the written costs submissions of the parties, and taking into account the factors mandated by Rule 57.01(1) of the Rules of Civil Procedure, this court considers that an award in the range sought by Beswick for all steps taken in the two applications from their commencement to February 27, 2014, including attendance at motions, is reasonable in all of the circumstances.
[3] The genesis of these proceedings was Southlake’s erroneous position taken with respect to the mediated settlement, and its attempt to re-litigate claims that had been settled. The position taken by Southlake was not upheld by this court, other than the narrow issue of its right to a reconciliation and calculation of additional rent for the entirety of 2013. However, its application sought to re-litigate claims going back to 2007, notwithstanding that it had released its right to make such claims. That position led to a withholding of rent, triggering Beswick’s responses. Beswick’s legal actions to secure payment of rent from November 1, 2013 onward are understandable in light of:
The faulty legal position taken by Southlake;
Southlake’s refusal to pay rent;
The amount of the monthly rental payments, being in excess of $500,000.
[4] Beswick was successful in the outcome, other than the narrow issue referred to above. It was also not successful on its motion of December 20, 2013, and therefore the costs fixed by Mullins, J. of $1,500 have been taken into consideration in the amount awarded to Beswick.
[5] Solicitor-client costs have been granted by this court as a mechanism for ensuring that re-litigation of previously settled claims is discouraged: Taske Technology v. Prairiefyre Software Inc. 2004 CarswellOnt 3838 (Ont. Master) at paras. 1 and 3; Ysselstein v. Tallon 1992 CarswellOnt 414 (Ont. C.J. (Gen. Div.)) at para. 71; Panasonic Canada Inc. v. Morrison 2003 CarswellOnt 1834 (Ont. S.C.J.) at para. 65. For the same reasoning set out in those cases, I find that an award on this scale should be made in this case. In addition to that overall unreasonable position taken by Southlake, it compounded that unreasonableness by asserting that Beswick was at fault for failing to produce annual costs reconciliations, and asserted that Beswick’s principal had engaged in serious misconduct which included deceit and misrepresentation. These are allegations of fraud-based behaviour. As set out in my reasons, such allegations were unreasonable and unsupportable on the evidence. The law supports an award of costs on a substantial indemnity scale where unfounded fraud-like allegations are made, as was the case here: A-C-H International Inc. v. Royal Bank (2005), 2005 CarswellOnt 2043 (Ont. C.A.) at para. 31; Susin v. Chapman (2004), 2004 13175 (ON CA), 2004 CarswellOnt 3055 (Ont. C.A.) at para. 12; 131843 Canada Inc. v. Double “R” (Toronto) Ltd. (1992), 1992 CarswellOnt 437 (Ont. Gen. Div.) at paras. 13-17. Additionally, at paragraphs 16.01 of the Lease, default for non-payment entitles Beswick to recovery of all expenses incurred in “remedying or attempting to remedy such default”, to be paid as Additional Rent.
[6] I decline to award interest on the rents as sought by Beswick, as such charges should have been addressed in the main argument.
[7] The amount sought by Beswick is within the reasonable expectation of Southlake, as Southlake’s own Costs Outline set out fees and disbursements of $82,603.00.
[8] Given all of the considerations set out above, and additionally, taking into account all of the circumstances of the litigation including the truncated timelines, the amount of material prepared by Beswick’s lawyers, and the seriousness of the issue to Beswick, the amount sought is within a reasonable range. The amount outlined in the Bill of Costs has been reduced by the costs associated with the attendance before Mullins, J., and the time spent on preparation of costs submissions, which between three lawyers excessively totalled 28.8 hours. Further, the amount sought is reduced to reflect Southlake’s success with respect to the issue of 2013 Additional Rent costs.
[9] This courts orders that Southlake shall pay costs to Beswick fixed in the amount of $130,000 inclusive on a substantial indemnity scale, to be paid within 30 days.
HEALEY J.
Released: April 11, 2014