Court File and Parties

COURT FILE NO.: CV-08-00362411-0000
DATE: 2014-07-15

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Men at Work General Contractors Ltd., Plaintiff/Respondent

AND:

Ross MacDonald and Jacqueline Marcia Phillip, Defendants/Moving Parties

BEFORE: Regional Senior Justice Morawetz

COUNSEL:
Michael Meredith, for the Plaintiff/Responding Party
Michelle R. Theberge, for the Defendants/Moving Parties

HEARD: May 21, 2014

ENDORSEMENT

[1] At the conclusion of argument, I directed the parties to obtain an appointment before McEwen J. for the purpose of having a case conference in an attempt to resolve the issues that were the subject of the motion before me.

[2] I have been advised that the parties did attend before McEwen J. and the matter remains unresolved.

[3] Mr. Ross MacDonald and Ms. Jacqueline Marcia Phillip (the “Defendants”) bring this motion for an order:

(a) directing that the Reasons for Decision of the motions judge dated June 18, 2013 (the “Reasons”) be reconsidered pursuant to Rule 59.06 of the Rules of Civil Procedure, or reheard pursuant to section 123(4) of the Courts of Justice Act (the “CJA”); or

(b) alternatively, an order settling the Reasons.

[4] On June 18, 2013, the motions judge released Reasons in respect of a motion to oppose confirmation of Master Polika’s report on a construction lien dispute.

[5] The moving parties take the position that clarification is required in respect of the Reasons, but the motions judge retired before clarity could be obtained or before any corrections or amendments could be made. The moving parties contend that there are errors in the Reasons and not all of the issues before the motions judge were adjudicated and further, that the motions judge also failed to consider all of the relevant facts and law which were submitted by the parties.

[6] At trial, Master Polika awarded $15,002 in damages and dismissed the plaintiff’s claim for lien. The Master also denied costs.

[7] Men at Work brought a motion to oppose the confirmation of the Master’s report made on the reference. Men at Work sought to restore its lien claim, obtain its full damages claim of $60,937.76 and an award of costs for the trial and the appeal.

[8] Pursuant to Rule 54.09(5) a judge hearing a motion to oppose confirmation of a Master’s report may require the Master to give reasons for his or her findings or conclusions and may confirm the report in whole or in part or make such other order as it just.

[9] For the purposes of disposing of this motion, the relevant portions of the Reasons are paragraphs 11 - 15:

[11] There was a two-day trial before Master Polika. He denied Men at Work any fee or profit for its 30 weeks on the project. He made what he described as a “Solomon decision” and ordered the owners to reimburse Men at Work for half of what it expended on the project. His calculations in respect to this amount were $15,002.50, which Men at Work claims to be erroneous. If he was awarding half of Men at Work’s expenditures on the project, the result would be $30,468.88.

[12] Master Polika found that Men at Work had breached its “timely reporting” obligation but he also found that the owners had waived it because they did not ask for a report on expenditures on any occasion. Despite the finding of waiver, the Master denied Men at Work its fees and profit on the basis of the purported breach. It is to be noted that Men at Work and the owners were communicating often either by way of e-mail or face to face conversations.

[13] Men at Work submitted that in reaching his decision, the Master erred in his interpretation of the contract. Men at Work submitted the he disregarded the plain language of the contract and imposed a “timely reporting” obligation on Men at Work. I agree that it appears that from the Master’s disposition of the matter that he disregarded the plain language of the contract.

[14] Master Polika dismissed the claim for the lien on the basis that there was no evidence of the issue before him. The owners’ various counterclaims were also dismissed in their entirety. The Master denied Men at Work its costs without allowing the parties to make any submissions.

[15] For all of the above reasons, this appeal is allowed. Men at Work being the successful party on this appeal should have costs on a partial indemnity basis. The parties may make submissions on costs at a time convenient to counsel and The Court.

[10] Section 71 of the Construction Lien Act prescribes a 15-day period within which to appeal the result of a motion to oppose the confirmation of a report. The Defendants have not appealed the Reasons.

[11] The Defendants submit that the motions judge did not adjudicate on several issues which were set out in the Plaintiff’s Factum, the Defendants Factum and the parties oral submissions as follows:

(a) whether the Supplementary Motion Record of the Plaintiff was admissible and/or given any weight;

(b) what the appropriate standard of review was and whether the standard of review had been met;

(c) whether Master Polika made reversible errors; and

(d) whether it would be appropriate for an order to be made requiring Master Polika to give reasons for any of his findings and/or conclusions.

[12] The Defendants further submit that the Reasons are entirely insufficient on the evidence which was before her and that, had she properly considered all of the facts and law, she could not have arrived at a conclusion simply to allow “the appeal”.

[13] Section 123(4) of the CJA reads as follows:

S. 123(4) Inability to give decision; sitting alone – Where a judge has commenced hearing a matter sitting alone and,

(a) dies without giving a decision;

(b) is for any reason unable to make a decision; or

(c) does not give a decision under subsection (2).

a party may make a motion to the chief judge for an order that the matter may be reheard.

[14] In the Reasons, the motions judge considered Men at Work’s first argument (errors in contractual interpretation) and found that ground to be determinative of Men at Work’s success. The motions judge also noted that the Master denied Men at Work its costs without allowing the parties to make any submissions and identified this point a one of the “reasons” for allowing the appeal.

[15] I am in agreement with the position being taken by the Plaintiff, namely, that the single issue before the motions judge was whether to confirm the Master’s report or not. She disposed of this issue by allowing the “appeal”.

[16] The motions judge also addressed the issue of costs and invited the parties to make submissions.

[17] The Reasons address the issue that was before the motions judge, namely, whether to confirm the report of Master Polika. In my view, the Reasons constitute a “decision” within the meaning of the CJA. The Defendants may be of the view that the decision of the motions judge contained an error of law on the basis that the Reasons are inadequate, but that does not, in my view, bring the issue within the scope of section 123(2) of the CJA. A decision, and the reasons supporting a decision, are distinct elements and it is clear that the motions judge rendered a decision.

[18] Furthermore, it seems to me that the intended purpose of section 123 of the CJA is not to provide a remedy for the problem that the Defendants have in this matter. Section 123 of the CJA provides guidance where a judge dies, retires or otherwise becomes incapacitated while still having outstanding work. It does not seek to address concerns a litigant might have with the content of a decision that has been rendered.

[19] In my view, the remedy that the Defendants are seeking is in the nature of an appeal.

[20] I also fail to see how R. 59.06 is of any assistance to the Defendants. Rule 59.06(1) addresses the issue of amending an order that contains an error arising from an accidental slip or omission, or requires amendment in any particular on which the Court did not adjudicate. In this case, I am satisfied that the motions judge did adjudicate on the issue and there is no suggestion of an accidental slip or omission in the Reasons. Rule 59.04(3) provides that where a judge ceases to hold office after making an order but before it is signed, another judge may settle and sign the order. That would be the appropriate procedure to be followed in this case.

[21] The remaining issue is with respect to costs. Master Polika denied Men at Work its costs. This decision was reversed by the motions judge who stated that Men at Work, being the successful party on the appeal, should have costs on partial indemnity basis. This ruling is not restricted to costs of the appeal. In my opinion, it is with respect to costs of the entire proceeding.

[22] It is at this point that the actions taken by the parties throughout this proceeding have to be questioned. The Plaintiff brought a construction lien action for $60,937.76. The Defendants counterclaimed for $400,000 but they were subsequently able to particularize their damages and reduce their counterclaim to $63,000.

[23] In its cost submissions Men at Work seeks costs for the trial and the appeal, calculated with reference to the costs grid, in the amount of $135,007, not including HST. Men at Work also claim disbursements $6,251.50, including HST. The total amount claimed is $158,809.41.

[24] Considering the amount involved in this matter, I find that the claim for costs in this amount is extreme and unrealistic.

[25] In arriving at a reasonable amount for costs in the circumstances of this case, I have taken into account that Men at Work achieved a result more favorable than its Offer to Settle. This gives rise to the submission of Men at Work that it is entitled to costs on a substantial indemnity basis following the submission of the Offer to Settle. However, the motions judge held that costs are on a partial indemnity basis. Therefore, that is the applicable basis for granting an award of costs.

[26] I have also taken into account that this was a relatively straight-forward construction lien matter where the Plaintiff brought the action for $60,000 and the counterclaim was ultimately reduced to $63,000. Three lawyers were involved on behalf of the Plaintiffs. These lawyers docketed nearly 400 hours for the trial and the appeal. Mr. Meredith with 16 years of experience, Ms. Loosemore with 6 years of experience and Ms. McGrann with 4 years of experience. It seems to me that this is the type of case that requires the services of one lawyer, who need not be a senior counsel. In addition, the time spent in all aspects of the matter as outlined in the Costs Outline was, in my view, grossly excessive. The fact that the Defendants lawyers docketed 753 hours does not alter my conclusion.

[27] I have considered the submissions filed by the parties and I have also taken into account the facts enumerated under Rule 57, including the time spent, the results achieved and the complexity of the matter. In addition, I have also taken into account the principles set forth by the Court of Appeal in Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3rd) 291 (C.A.), specifically that the overall objective of fixing costs is to fix an amount that is fair and reasonable for an unsuccessful party to pay in the particular circumstances, rather than an amount fixed by actual costs incurred by the successful litigant.

[28] On a review of the comprehensive cost submissions of both parties, I have arrived at the conclusion that both parties have been responsible for increasing the cost and complexity of this proceeding. I have reviewed the 95 paragraph, 16 page submission of the Defendants, together with the supporting documentation as well as the 29 paragraph, 8 page submission of counsel to Men at Work, together with supporting documentation, and the 45 page responding cost record. In total, the costs submissions and supporting documentation of the parties covered approximately 350 pages. I question the benefits of spending so much time and effort on the costs outlines, as much as I do with spending so much time and effort on this proceeding in its entirety.

[29] Having considered the principles set out in Rule 57 and cost submissions, the Plaintiff is awarded $45,000 in costs, inclusive of disbursements and HST. This is not a case where costs awarded should exceed the amount in issue. I consider this award to be fair and reasonable in the circumstances.

[30] I expect that counsel can agree as to the form of order which reflects the foregoing.

Morawetz, R.S.J.

Date: July 15, 2014