COURT FILE AND PARTIES

COURT FILE NO.: 13-42492

DATE: 2014/12/11

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: TERRY S. BIENSTOCK, Plaintiff

AND:

ADENYO INC., 7539088 CANADA INC., ADENYO ACQUISITION SUB, INC., ADENYO USA INC., MICHAEL ORR, MICHAEL O’CONNOR, PAUL HENEY, TYLER NELSON, DAVID WILSON and DENNIS KAVELMAN, Defendants

BEFORE: The Honourable Justice D.A. Broad

COUNSEL:
Jon David Giacomelli and Ruzbeh Hosseini, for the Plaintiff

Aaron L. Kreaden for the Defendants

COSTS ENDORSEMENT

[1] The parties have been unable to agree on the costs of the motion ruled on in my Endorsement dated November 14, 2014 and have now provided their submissions on costs. The following is my disposition on the issue of costs.

Positions of the Parties

[2] The defendants submit that they should be entitled to substantial indemnity costs in the amount of $8,024 on the basis that the motion brought by the plaintiff was improper, vexatious or unnecessary. They say that of the five heads of relief sought by the plaintiff two were abandoned on the day of the motion, one of which was of an extreme nature being the request for an order striking out the Statement of Defence, which forced the defendants to incur costs in preparation of the factum and preparation for argument.

[3] In support of their submission that costs should be awarded on a substantial indemnity basis, the defendants point to the fact that the plaintiff booked and scheduled the motion without sufficient notice and without making any reasonable efforts to resolve or narrow the matters in issue. They also argue that counsel for the plaintiff failed to consult with counsel for the defendants with respect to scheduling of the motion and to accommodate the conflicting schedule of the defendants’ counsel. The defendants say that the motion was unnecessary and that they made every effort to avoid the costs associated with it and say that the totality of the conduct of plaintiff was vexatious, warranting an award of substantial indemnity costs.

[4] The plaintiff seeks costs from the defendants on a partial indemnity basis in the sum of $3,322.55. The plaintiff submits that it was necessary to have brought the motion as payment by the defendants of two of the three costs awards which were outstanding was not made until the date that the Motion Record was served and, prior to service of the motion materials, no commitment had been made for payment. Moreover, the plaintiff argues that the medical details which explained Mr. Orr’s failure to attend at his examination in aid of execution on October 31, 2014 were not provided until delivery of the defendants’ responding motion materials.

[5] The plaintiff advises that it was only upon receipt of payment of the two costs awards and the provision of the information respecting Mr. Orr’s medical condition that the decision was made not to seek the relief of striking the Statement of Defence and production of OHIP and medical records, in order to proceed in a fair and reasonable manner and to narrow the issues.

[6] The plaintiff submits that he was the successful party on the motion as payment of two of the three outstanding costs awards was not made until the motion was brought and he was awarded costs thrown away arising from Mr. Orr’s failure to attend on his examination, which had not previously been consented to by the defendants. He also submits that Mr. Orr’s affidavit indicating that he was willing to attend to be examined on December 4 or 5, 2014 was not provided until November 12, 2014, the day before the hearing of the motion.

Governing Principles

[7] Rule 57.02 provides for the court to fix the costs of a contested motion and order them to be paid within 30 days, unless the court is satisfied that a different order would be more just.

[8] The successful party on a motion is presumptively entitled to costs (see McIlvenna v. Greater Sudbury 2014 ONSC 4000 (S.C.J.) at para. 7.

[9] The factors to be considered by the court, in exercising its discretion on costs under Section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43, are set forth in Rule 57.01(1). Of particular relevance are firstly, the principle of indemnity referred to in subparagraph (0.a) and secondly, the question of what the reasonable expectation of an unsuccessful party would be, as referred to in subparagraph (0.b).

[10] As emphasized by the Court of Appeal in the case of Boucher v. Public Accountants Council (Ontario) (2004) 2004 14579 (ON CA), 71 O.R. (3d) 291, the overriding principle guiding the court in fixing costs is that of reasonableness. At paragraph 38, Armstrong, J.A. confirmed that in deciding what is fair and reasonable, the expectation of the parties concerning the quantum of a costs award is a relevant factor.

Analysis

[11] Both sides in this case assert that they were the successful party on the motion. In my view, the question of success is not to be measured solely by the disposition by the court on the issues which were required to be argued but also by the relationship between the situation immediately prior to the bringing of the motion in reference to the relief sought by the moving party and what was achieved by the bringing of the motion, either by consent or compliance by the responding party or by disposition by the court.

[12] In the present case there were three outstanding costs awards which had not been paid by the defendants and Mr. Orr had failed to attend to be examined in aid of execution notwithstanding service of a Notice of Examination on him. The veracity of his claim that his medical condition prevented his attendance was far from clear at the time that the motion was launched.

[13] In my view, the motion was necessary in order to induce compliance by the defendants, both in terms of payment of the outstanding costs awards and in securing Mr. Orr’s attendance to be examined in aid of execution. In that respect the plaintiff was the successful party and is presumptively entitled to partial indemnity costs of the motion.

[14] The defendants do not take issue with the time spent nor with the hourly rates as set forth in the plaintiff’s Costs Outline. However, I would reduce the amount of costs from the amount claimed to reflect the fact that the plaintiff was unsuccessful on the issue of production by Mr. Orr of documents in advance of his examination.

Disposition

[15] I hereby fix the plaintiff’s costs in the sum of $2,750.00, inclusive of fees, disbursements and HST. This amount is to be paid to the plaintiff within 30 days hereof.

D.A. Broad

Date: December 11, 2014