Gaur v. Datta et al., 2014 ONSC 4901

SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: CV-13-1230-00
DATE: 2014 08 22

RE: PRADEEP GAUR, APT FLOW TECHNOLOGY INC. and 2081706 ONTARIO v. DIPTI DATTA, UTPAL DATTA, INGE DATTA and M&I POWER TECHNOLOGY INC.

BEFORE: EMERY J

COUNSEL:
J. David Keith, for the Plaintiffs
Constance Olsheski, for the Defendants, Utpal Datta, Inge Datta and M&I Power Technology Inc.

COSTS ENDORSEMENT

1The moving defendants seek for the costs of the motion as the successful parties.

2In our civil justice system, the losing parties are generally ordered to pay the costs in a step of a proceeding.

3I have discretion under s. 131 of the Courts of Justice Act to grant those costs. In such circumstances as these, I must make determinations of entitlement, scale and the quantum of the costs requested.

4I have no difficulty with making the determination that the moving defendants Utpal Datta, Inge Datta and M&I Power Technology Inc. are entitled to the costs of the motion as they were clearly the successful parties. I would go so far as to say that the claims of the plaintiffs based on emails allegedly written by a third party on July 5, 2012 and July 11, 2012 should never have been relied upon to bring an action.

5The third email dated March 22, 2013 added when the Statement of Claim was amended, should never have been relied upon to bring a separate action. As I found in my reasons on the motion, any claim founded on that email should have been considered for inclusion when the plaintiffs, being the defendants in the prior action commenced in court file# CV-12-5725, defended that action and made a counterclaim.

6The greater issue is on what level the costs of the motion should be awarded, and the quantum of those costs.

7Ms. Olsheski has over 25 years of experience specializing in Employment Law. Now practicing outside of a large law firm, she is charging her clients $275 an hour. Her contemporaries in downtown Toronto charge much more than that. The reasonableness of the fees she charges to her own clients reflect well on her as it does on them.

8In ­­­­­­­­­­­­­­­­Guergis v. Novak et al, 2013 ONSC 1130, the court permitted the successful party the full extent of their legal fees when those fees were already reduced to what would otherwise be a partial indemnity level. I read into this approach that counsel who is assisting their client by charging fees at a more affordable level should not have any claim for costs compromised for that gesture. Here, I find that Ms. Olsheski’s fees already contain the necessary discount to stand as the appropriate measure of partial indemnity costs.

9I have also considered the effect of the offer to settle by the moving defendants dated July 27, 2013. Had the statement of claim not been amended, the moving defendants would have matched or exceeded that offer on this motion. When the statement of claim was amended, Ms. Olsheski for the moving defendants wrote the letter dated March 11, 2014 to make the second offer to settle in view of the amendments. That offer matched the result on motion. I do not consider a claim for costs to take away the element a compromise in an offer under Rule 49. A claim for costs that mirrors the effect of costs on an offer to settle that is not accepted under Rule 49.10 is merely a reflection of the Rule and not an added term that makes the offer different than the result.

10Given my endorsement on the motion and my foregoing comments, costs are awarded to the moving defendants at the actual rate charged by their lawyer of $275 per hour.

11The number of hours claimed by counsel for the moving defendants and the quantum of those costs that I am asked to fix is another matter. Counsel of considerable experience is expected to know the essential elements of those substantive areas of the law and civil procedure at issue. If they could not reasonably expect to encounter those areas in practice, they are expected to at least know where to look for legal sources and the leading authorities in that area. Counsel cannot educate themselves without limitation at the expense of their client or of unsuccessful parties when bringing or opposing a motion. In this case, Ms. Olsheski has claimed the following:

1. Research on defamation – 8 hours
2. Research on Intentional Interference with Economical Relations and Inducing break of Contract – 7 hours
3. Research on Rules 21 and 25 – 10 hours

12Ms. Olsheski has also made a claim for additional research by a junior lawyer at a reduced rate of $50-$75 per hour for 14.5 hours for research on striking defendants claim for want of jurisdiction and 25 hours for further research by a Jr. lawyer.

13Furthermore, I find that Ms. Olsheski has claimed generous amounts of time for the preparation of the motion. The amount of time for each stage of the process are shown on the costs outline to be:

1. Drafting Notice of Motion, Affidavit, preparation of motion materials, serving of materials – 19.8 hours
2. Determination of which case law to include: drafting of Factum, compiling a Book of Authorities – 19 hours
3. Additions and revisions to Motion Record and materials as a result of Amendment to Statement of Claim: drafting of amended Notice of Motion; drafting of supplementary affidavit of Utpal Datta – 12 hours
4. Review of respondent’s materials for preparation of motion - 23.6 hours

14Using the principles set out by the Court of Appeal in Boucher v. Public Accounts Council for the Province of Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291 (Ont. C.A.), I must also determine what costs are reasonable, and what the unsuccessful party could reasonably have expected to pay on this kind of motion.

15Applying applicable factors provided by Rule 57.01 is helpful in this analysis. Those factors include the complexity of the issues, the importance to the parties, anything any party has done to unnecessarily lengthen the process, any offers to settle made, and of course, the result.

16I consider that the issues considered on the motion were of moderate complex. Areas of substantive law in the areas of defamation and wrongful interference with economic relations were argued together with the requirements of Rule 21 to show the plaintiffs had no reasonable cause of action in the amended statement of claim. Further, the plaintiffs could have conceded their positions when the evidentiary deficit became apparent on being served with one or more of the Demands for Particulars prior to the motion. They intentionally persisted with maintaining the action, thereby causing unnecessary delay and ultimately bringing this motion upon themselves.

17Rule 57.01 also allows me to consider any offer served in addition to the factors under Rule 57.01(1).

18Having regard to these factors and the principles provided by the cases on the law of costs, I find it fair and reasonable to award costs to the moving parties in the amount of $14,000 for Ms. Olsheski and her office to research the finer points of law and to prepare motion materials, and $2,500 as a counsel fee to attend before the court for argument. The costs awarded are therefore fixed in the amount of $16,500 for the motion, and $1,500 for the action before the motion was brought for a total of $18,000, plus $1,211.55 for disbursements and all applicable HST.

Emery J