Court File and Parties

COURT FILE NO.: CV-08-00358443-0000 DATE: 20141204

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: JIAN CHEN JR., a minor by his Litigation Guardian, Ai Ying Yu, and AL YING YU, YI LIN CHEN and LONG QIONG HE, Plaintiffs

AND:

TORONTO TRANSIT COMMISSION and ANTONIO MICCIO, Defendants

AND B E T W E E N:

TORONTO TRANSIT COMMISSION and ANTONIO MICCIO, Plaintiffs by Counterclaim

• and -

YI LIN CHEN and LONG QIONG HE, Defendants to the Counterclaim

BEFORE: Mr. Justice Lederer

COUNSEL: Mark Elkin, Andrew Suboch & Stephanie Fell, for the Plaintiffs J. Thomas Curry & Stephen Sargent, for the Defendants Chad Townsend & Tamara Broder, for the Plaintiffs by Counterclaim Thomas H. Percival & Jennifer Vrancic, for the Defendants by Counterclaim

COSTS ENDORSEMENT

[1] This was a lengthy trial. It concerned an accident in which a four-year-old child was struck by a streetcar and was seriously injured.

[2] The child ran in front of the streetcar. The Toronto Transit Commission and its operator were not liable. The child appeared between two parked cars, ran across the travelled portion of the roadway and in front of the streetcar in a manner and at a speed such that, given the position and speed of the streetcar, the accident could not be avoided by the actions of the operator.

[3] The Toronto Transit Commission counterclaimed against the parents of the child on the basis of their failure to properly supervise the child. The counterclaim against the father was dropped when it became apparent that, on the day of the accident, he was out of the country. The mother gave evidence at the trial explaining what happened in the moments leading up to the accident. The counterclaim is only with respect to sharing the liability, if any, that was attributed to the Toronto Transit Commission. The parties agreed that, if no liability was found against the Toronto Transit Commission, the court need not determine if the mother shared in the liability for any of the injuries suffered by her child.

[4] This was a difficult case. It required the resolution of a number of technical issues concerning the engineering, function and operation of a streetcar, as well as the expectation of the response times of a qualified operator. All of this had to be accounted for as taking place in a busy urban environment at the particular time, in the circumstances present as they could best be defined and identified.

[5] There is no doubt that the case required a trial. In its submissions as to costs, the Toronto Transit Commission observed that: “The trial was lengthy and well tried. No reasonable basis for liability was left unexplored by experienced counsel for the Plaintiffs…”

[6] Generally, it is understood that costs follow the event, that is to say the unsuccessful party is required, in some measure, to pay the costs of the successful party. Having said this, the fact remains that costs are a matter of discretion.

[7] I am not prepared to follow the general understanding.

[8] I begin with an assessment of the costs requested.

[9] The Toronto Transit Commission seeks costs in the amount of $326,429.36, made up of $197,985.00 for legal fees + $25,738.05 for HST + $102,706.31 for disbursements. This is referred to in the submissions, made on behalf of the Toronto Transit Commission, as a reduced amount. The initial Bill of Costs found in those submissions shows costs of $390,489.06. The difference is in a reduction in the fees claimed from $254,675.00 to $197,985.00, being $56,690 and the accompanying reduction in HST from $33,107.75 to $25,738.05, being $7,369.70. The total difference is ($56,690 + $7,369.70) $64,059.70. The claim for disbursements remains the same ($102,706.31).

[10] The reduction in fees is accounted for as follows:

• The costs associated with Steve Sargent were reduced by lowering the rate charged for his time from $225.00 to $60.00 per hour. This represents a reduction of $36,465.00
• The cost of the time associated with Tamara Broder was reduced from $225 to $0, which is to say, no claim is being made for her time. This represents a reduction of $14,625.00
• The costs associated with outside counsel (Tom Currie) were reduced by lowering the hours for which costs are sought by 16 hours. The resulting reduction was ($76,475.00 - $70,875.00) $5,600

TOTAL $36,465.00 + $14,625.00 + $5,600 = $56,690

[11] I feel obliged to say that, while it is to the credit of the Toronto Transit Commission that it has made this reduction, I do not see it as an act of generosity. Rather, it was appropriate. It would not be right to award costs for three lawyers (Sargent, Townsend and Currie) to be involved in the pre-trial work and to attend this trial, particularly when the costs claimed are said to be on a partial indemnity scale. Similarly, it would be too much to suggest that the plaintiffs should anticipate the participation of a fourth lawyer (Broder) in the preparatory work. To my mind, it would be unreasonable in a case such as this to expect the plaintiff to anticipate having to pay for anything more than two lawyers. Accordingly, if I needed to, I would reduce the costs request made in respect to the work of the third lawyer representing the Toronto Transit Commission (Sargent) to $0.

[12] This trial had a rocky and unhappy beginning. There were three pre-trials. Ultimately, with the assistance of Mr. Justice John Macdonald, it was agreed to trifurcate the trial. There was to be a trial examining the liability of the Toronto Transit Commission. If it was determined that there was such liability, there was to a second process examining the potential contributory liability of the mother of the child. With liability determined, there would have been an assessment of damages.

[13] The trial was to commence Sept. 23, 2013. There was considerable discussion about how the trial would proceed. A motion was brought, on behalf of the Toronto Transit Commission, to change the process it had agreed to and to adjourn the trial. The adjournment was refused. Only then did counsel for the Toronto Transit Commission make it apparent that, during the first phase of the trial, the phase directed to the liability of the Toronto Transit Commission, it intended to call evidence that implicated the mother of the child as sharing liability for the injury and damages. In short, the Toronto Transit Commission confirmed it was unprepared to respect the process it had agreed to. As a result, the trial was adjourned. It should be said that the evidence to be called, by the Toronto Transit Commission, to support the liability of the mother had been the cause of an earlier adjournment. At that time, the difficulty was that counsel for the plaintiff had not been advised of the existence of the witness involved. Counsel for the Toronto Transit Commission had interviewed the witness and concluded he had nothing relevant to offer. Counsel for the plaintiff wondered if the witness might assist his position at the trial. Counsel for the plaintiff was more than surprised when, after two days of debate and the refusal of a further adjournment, counsel for the Toronto Transit Commission announced his intention to call the witness during the first phase of the trial in order to link the mother to the cause of the injury.

[14] The trial commenced on December 9, 2013 at which time liability, as a whole, was considered and determined. In the meantime, there was a further appearance on October 8, 2013 to consider if the costs of the false start should be assessed directly against counsel for the Toronto Transit Commission (see: rule 57.07(1)(c) and (2) of the Rules of Civil Procedure, which allows for such an order and for it to be made on the initiative of the court). In the end, no order of this type was made.

[15] The Toronto Transit Commission does not claim any costs for the appearances that ended in or arose as a result of the second adjournment of the trial. It was right to do this. These costs should not be left to follow the event.

[16] The same is true of the costs expended in relation to the first of the two adjournments. It took place during June 2013. For that month, counsel for the Toronto Transit Commission (Townsend) seeks costs for 25 hours work at $300 per hour ($7,500) attributable to:

Preparation for and attendance at trial and review of matters pertinent to adjournment request.

[17] For the previous year (May 2012 to May 2013), a claim for 65 hours at $300 per hour ($19,500) is made attributable to:

…preparation of pre-trial memorandum, various internal meetings, attendance at four pre-trials, preparation of Requests to Admit, litigation research on liability preparation of brief and affidavit on evidentiary objection of opposing counsel, meetings with various witnesses with adjusters.

[18] At least some part of this would be costs of preparation for trial that, as a result of the adjournment, was not used or would have to have been repeated as the trial approached in December, 2013.

[19] I observe that, although outside counsel did appear in court during September and on October 8, 2013, the Bill of Costs indicates that no claim is being made for his participation at that time. The Bill of Costs seeks costs beginning October 11, 2013; the accompanying dockets show the first entry being October 13, 2013. Accordingly, any reduction on account of the first adjournment must refer to the charges for in-house counsel (Townsend) who, at the time, had carriage of the file. If required to, I would reduce the claim for costs, on account of the costs being claimed by the Toronto Transit Commission in relation to the first adjournment and the costs that were thrown away as preparation for trial as a result of the two adjournments in the amount of $15,000 ($7,500 for the time spent during June 2013 and a like amount for any earlier preparation for those appearances and the trial).

[20] It should be apparent that it is not just the costs of the Toronto Transit Commission that are of concern. In his submission as to costs counsel for the plaintiff submitted that his client should receive costs thrown away for both adjournments.

[21] I agree. The two adjournments arose from failures of counsel for the Toronto Transit Commission. The plaintiffs and the defendants by counterclaim should receive credit for their costs thrown away. This includes the appearance dealing with the possibility of costs against counsel. It is difficult to assess the value of these costs with any precision. For one thing, it involves two senior counsel, on behalf of the plaintiffs, and a third counsel for one of those parties (the mother) in her role as defendant to the counterclaim. I assess these costs at a value of $25,000.

[22] If this ($15,000 + $25,000) $40,000 reduction was to be assessed against the claim for costs recognizing the participation of the senior counsel from the Toronto Transit Commission (Townsend), it would leave a remaining claim for fees of ($111,450 – $40,000) $71,450, plus the time spent by outside counsel ($70,875).

[23] Next, there is the concern that, for the trial, the Toronto Transit Commission had two senior counsel. On a trial of this kind, it is appropriate that there be two counsel representing one client, but not both at the costs associated with more experienced counsel. In this case, the in-house lawyer (Townsend) claims costs for 235 hours, beginning October and November 2013 and running to the end of the trial in March 2014, at $300 per hour, for a value of $70,500. If required to, I would reduce these costs by ($100 per hour x 235 hours) $23,500, leaving the costs to be claimed as fees for the in-house counsel (Townsend) at $71,450 - $23,500) $47,950.

[24] This does not account for the fees of the outside counsel, being $70,875, or the claim for the costs of a legal clerk, being $2,400, leaving the outstanding claim for fees as ($47,950 + $70,875 + $2,400) $121,225.

[25] There remains the claim for disbursements which totals $102,706.31. I have reviewed the invoices produced in support of this part of the claim. For some I am unable to locate any supporting documentation, for example:

• Paid to Aston Investigations, $2,248.19
• Payments of Conduct money to (Hood), $53.00, (Beaupre), $53.00, (Dallimore, $71.07, $58.00 and $148.00, (Zhang), $53.00 (2X), (Jiang), $53.00 and (Scofano) $53.00
• Paid to the Minister of Finance, $366.00
• Paid to Police Report, $5.00
• Paid for various court filings (Statement of Defence), $144, (30.10 Motion for Police Records), $127.00 (2X) and (Motion Record), $127.00
• Paid for Motor Vehicle Search, $12.00

[26] There are charges, that without explanation, are difficult to assess:

• Evidence of Barry Raftery on an unrelated file (Greer v. Kurtz) $106.00
• Legal Link (Real Estate Sub-searches), November 11, 2010, $317.25
• Paid to Network late cancellation, 10/6/2010, $228.50 (on the summary where the invoice is for $282.50)
• Paid to Able Translators interpreter for statement, 5/18/2012, $113.00
• Paid to Professional Search Services for Property Title Search, 18 Sept. 12, $319.360
• Paid to FIC Surveillance/Reporting, January 30, 2013 and March 22, 2013 respectively, $2,160.96 and $1,860.54
• Paid Law Society Photocopies, 6/07/13 and 6/11/13 respectively ($5.08 + $7.34) $12.42
• Paid to Professional Search Services for Property Title Search, 30 May /13 and 4 June /13, respectively, ($148.00 + $40.90) $188.90
• Paid to Professional Search Services for Property Title Search, 5 June /13 and 10 June /13, respectively, ($115.40 + $171.30) $286.70
• Paid to FIC Surveillance, January 25, 2013, $3,126.37
• Paid Professional Search Services Property Title Search 16 Sept. /13, $69.50
• Paid to FIC Surveillance September 18, 2013, $2,747.88
• Paid Legal Express Order and Review Files in Hamilton apparently on an unrelated file (Greer and Integrated Maintenance), November 6, 2013, $257.94
• Paid to All Languages, 12/02/2013, $277.98, which includes $82.00 referred to as “Same-day Service”
• Paid to Toronto Lawyers Association Room Rental, 12/242013, $339.00
• Paid to Trac Tracing (apparently searching for “Alexandra Wicht”, well after the trial was underway) 1/16/2014, $56.50
• Paid to MCIS Language Interpreter (“face to face interpretation”) 12/1/2013, $188.15
• Paid to KingReed Surveillance/reporting (General Investigation ($706.20) and searches etc., after the trial had started), January 23, 2014, $996.89
• Paid to FIC Surveillance, (when the trial was near the end), March 19, 2014, $336.49

[27] I cannot evaluate the following various medical reports and related charges which were not used at the trial dedicated to liability:

• Paid to Andrew Subboch Dr. Lo records, August 31, 2010, $44.90
• Paid to Able transportation Dr. Meloff (2X), 11/30/2010 and 10/18 2010, respectively, $99.38 and $141.25
• Paid to National IME Centres Expert Report (Medical Document Review-Dr. Meloff), 12/3/2010, $4,915.00
• Paid to Makej Financial clinical records (Dr. Michael Lai & Dr. Alice Lai), 2012/2/23 and 2012/2/24, ($231.65 + $151.29) = $381.94
• Paid to Neurological Rehab Dr. Diep records (letter Townsend to Vaduva), July 13, 2012, $130.50
• Paid to Andrew Subboch half Dr. Mackinnon Report, 03/05/2013, $3,120.00

[28] As well, there are a broad array of charges associated with service of material, filing of documents and the supply of transcripts which I cannot assess on an individual basis.

[29] What is clear from all of this is that it would be unfair to blindly award costs covering each and every item claimed. There is too much that is open to question. For example, there is $10,232.24 paid to FIC Surveillance; there is a charge from Aston Investigations without a supporting invoice or explanation in the amount of $2,248.19. I cannot know what Dr. Meloff or Dr. Mackinnon did or what they would have contributed to the trial. Together, they represent a claim for costs of in excess of $8,035. Why should the plaintiff pay for the renting of a room? Why was it necessary to find Alexandra Wicht after the trial was underway? What was the purpose in obtaining the transcript of Barry Raftery at another trial? Why was there a late cancellation?

[30] Are these things the losing party could reasonably anticipate paying for? Moreover, what, if any of this, was associated with the two aborted efforts to commence the trial or fall into the category of costs thrown away?

[31] Some adjustment has to be made to the claim to accommodate or account for these concerns. In the circumstances, if necessary, I would order costs for disbursements to be paid by the plaintiffs to the Toronto Transit Commission in the amount of $70,000.

[32] Based on this assessment, the total award of costs to the Toronto Transit Commission would be $121,225 for fees and $70,000 for disbursements, for a total of $191,225, plus HST, plus interest at the rate prescribed by the Courts of Justice Act.

[33] As it is, I exercise my discretion and award no costs to the Toronto Transit Commission. Typically when the Toronto Transit Commission is involved in an accident where it was not negligent, absent a third party, the fault would be ascribed to the carelessness of the person injured. In this case, this would mean assessing or assuming the fault of the child. A four-year-old child cannot be responsible or negligent. There being no negligence, I am not prepared to find that costs should be awarded against the child or his litigation guardian.

[34] I note that the Toronto Transit Commission is a public enterprise, offering a public service to the citizens of Toronto. The nature of the service it offers dictates that the vehicles it operates will be involved in accidents and that members of the public it serves will seek redress. Not all of them will succeed. The question is whether those members of the public who do not succeed, where it is acknowledged a trial was appropriate or where the injured party was not at fault, should be asked to pay costs. In this case, they should not. It would be simplistic to say that, for the Toronto Transit Commission, having to absorb the costs of a trial such as this one is a cost of doing its business. This is not about any business aspect of how the Toronto Transit Commission operates. It is a cost of being a public service. In an earlier time, public agencies were slow to seek costs from the public that they served and costs were not awarded to counsel employed directly by public agencies on the basis that they were salaried and, as a result, their involvement in court proceedings did not represent an additional cost to the public agency that employed them. While this has changed (see: Solicitors Act, R.S.O., 1990, c. S.15, s. 36 and, for the Crown, Courts of Justice Act, R.S.O. 1990, c. C. 43, s. 131(2)), to my mind, the values this approach represents should not be easily or always forsaken.

[35] It bears considering how this determination impacts on the role costs are intended to play in present day litigation:

Modern cost rules are designed to advance five purposes in the administration of justice: (1) to indemnify successful litigants for the costs of the administration of justice, although not necessarily completely; (2) to facilitate access to justice, including access for impecunious litigants; (3) to discourage frivolous claims and defences; (4) to discourage and sanction inappropriate behaviour by litigants in their conduct of the proceedings; and (5) to encourage settlements.

(Perell and Morden, The Law of Civil Procedure in Ontario, Second Edition LexisNexis Canada Inc. 2014, at pp. 783-4)

[36] Overall, these purposes would not be advanced by an award of costs in favour of the Toronto Transit Commission. It would not facilitate access to justice to require individual litigants, suing a public agency, to pay costs for trial where they do not share in the liability, particularly costs of the magnitude being sought by the Toronto Transit Commission or as assessed in this endorsement. This was not a frivolous claim; there was no inappropriate conduct and, given the technical nature of the issues and the seriousness of the injuries suffered, there could be no inherent expectation that settlement was possible. By its nature, the Toronto Transit Commission bears less risk in proceeding to trial than individuals such as the plaintiff and his family. The indemnification of the Toronto Transit Commission for its costs would minimize whatever risk it carries and would serve to discourage whatever chance of settlement remains. Viewed as a whole, this confirms the proposition that, in the circumstances of this case, it is best that there be no award of costs in favour of the Toronto Transit Commission.

[37] This leaves the costs of the counterclaim. The parties agreed, there being no liability found against the Toronto Transit Commission, there was no need to determine whether the mother bore any liability for the accident. On that basis, the Toronto Transit Commission said that each party should bear its own costs. Without going further, I would not agree. As matters transpired, there was no need for the mother to have been sued. The issue is: Who took the risk of this result? Was it the plaintiffs in bringing the lawsuit or the Toronto Transit Commission in responding with the counterclaim? I return to what was said at the outset. In acknowledging that the case was “lengthy and well-tried” with “no reasonable basis for liability...left unexplored”, the Toronto Transit Commission agreed there was a purpose to the trial. To put it differently, the Toronto Transit Commission is conceding it was not wrong or irresponsible to commence and continue the action. As matters developed, there was little purpose in bringing the counterclaim. On the facts of this case, it is the Toronto Transit Commission which took the risk.

[38] Counsel for the defendants by counterclaim requests costs of ($117,079.30 for fees + $3,716.38 (both including HST)) $120,795.68. He paid a relatively minor role in this proceeding: nothing that comes close to justifying costs in this amount. Only one counsel was apparent during the trial. I am not prepared to award costs for the participation of any of the other counsel, clerks or students-at-law to whom the Bill of Costs, filed in support of this claim, refers. Moreover, given the nature of the role played by counsel who appeared (and remembering this claim is for partial indemnity costs), if required, I would reduce his hourly rate by $100 per hour to $225.00 per hour. This alone would reduce the fees sought to ($96,947.50 for counsel - ($100 x 298.3 hours spent by counsel) $29,830) $67,117.50. There were 20 days of trial. On 5 of those days, the Bill of Costs shows no charges (September 23, 2013, September 27, 2013, October 8, 2014, March 17, 2014 and March 26, 2014); for a sixth, it shows 7.9 hours, but none associated with appearing in court (December 19, 2013). For the remaining 14 days, counsel seeks costs for a total of (September 26, 2013: 5.8 hours, December 9 2013: 10.0 hours, December 10, 2013: 9.0 hours, December 11, 2013:10.0 hours, December 12, 2013: 5.0 hours, December 13, 2013: 5.2 hours, December 16, 2013: 9.0 hours, December 17, 2013: 9.0 hours, December 18, 2013: 9.5 hours, December 20, 2013: 8.9 hours, January 9, 2014: 6.5 hours, January 10, 2014: 5.0 hours, March 27, 2014: 12.9 hours and March 28, 2014: 8.7 hours) 114.5 hours. This would have a value of ($114.5 x 225.00 per hour) $25,762.50. Some of this would be accounted for by work done outside of the court room. Taking into account the contribution of counsel, in the end, I would have, if required to, reduced the fees to represent the time in court to $20,000 and doubled this number to account for preparation and added $5,000 for disbursements and HST.

[39] In the normal course, had I awarded costs of the main action against the child or his litigation guardian, I would make an order for costs of the counterclaim against the Toronto Transit Commission, but I would have required that those costs be set-off against the costs owed to the Toronto Transit Commission in the main action (see: Courts of Justice Act, R.S.O. 1990, c. C. 43, s. 111(2)).

[40] Accordingly, had I been required to, I would have awarded costs of the counterclaim to the defendants by counterclaim in the amount of $45,000. Setting this off against the costs that would have been owed to the Toronto Transit Commission would reduce the fees to be paid on account of the main action to ($191,225 - $45,000) $146,225.

[41] As it is, the proposition that, where there is no fault there should be no costs, cuts in both directions. I make no award as to costs of the counterclaim.

[42] It should be said that had the Toronto Transit Commission held to its agreement to allow the counterclaim to be dealt with at a subsequent and separate proceeding, if and only if, liability had been established against it, this problem would not have arisen. There would be no costs of the counterclaim to pay for. I also note that, as matters transpired, the witness that was to implicate the mother’s supervision of her child did not do so raising the question of why the Toronto Transit Commission chose to resile from its agreement.

[43] Finally, the Toronto Transit Commission sought to have any order of costs made in its favour apply to the litigation guardian, apparently in his personal, as opposed to representative, capacity. In the absence of such an order, this request is without immediate meaning. Nonetheless, it may be as well if I make some comment. There is no suggestion that the litigation guardian did anything ill-advised, improper or not in the interest of the child. We want people to assist those who are unable to instruct counsel or act on their own behalf. We do not look to these citizens to take on personal liability for the costs of the action as a natural or inexorable part of their responsibilities. In this regard, the Toronto Transit Commission referred to Meady v. Greyhound Canada Transportation Corp., [2013] O.J. No. 4634. The court accepted the proposition that, in that case, the plaintiffs should be jointly and severally liable for any award of costs. The case says nothing about this applying to a litigation guardian in his or her personal capacity. If it did, no one would volunteer to take on these responsibilities.

[44] There will be no order as to costs. Each party must pay its own.

LEDERER J.

Date: 20141204