King David Inc. v. Andrin Investment Ltd.
CITATION: King David Inc. v. Andrin Investment Ltd., 2015 ONSC 1935
COURT FILE NO.: CV-11-440058
DATE: 2015-03-25
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: King David Inc., Plaintiff AND: Andrin Investments Ltd., Defendant
BEFORE: Sean F. Dunphy, J.
COUNSEL: Adam J. Wygodny, for the Plaintiff Kenneth R. Clark and Miranda Spence, for the Defendant
HEARD: March 24, 2015
COSTS ENDORSEMENT
[1] The plaintiff in this case brought a motion for partial summary judgment alleging breach of the Copyright Act, R.S.C. 1985, c. C-42. It rapidly became clear during argument that the plaintiff was under the misapprehension that there was a legal requirement for any license to use copyright material to be in writing whereas the defendant claimed, based on disputed evidence, to have had the benefit of a license to use the material arising from oral or implied consent. Unfortunately for the plaintiff, the writing requirement relied upon applies only to conveyances of an interest in the copyright itself (s. 13(4)) and not merely to consent to the use of copyrighted material for which no writing requirement is specified (s. 27). This was not a sudden flash of insight offered from the bench to the surprise of counsel who had never considered the matter in that light before. This was indeed a central theme – if not THE central theme – of the respondent’s factum and arises from a plain and straightforward reading of the statute. All that became clear to counsel in argument was that the respondent’s argument had found its mark and I was greatly persuaded by it.
[2] While valiantly argued, the plaintiff ultimately accepted the inevitable and, taking advantage of an offered break, agreed to abandon its motion on terms negotiated between the parties. The only outstanding issue regarding the disposition of the partial summary judgment motion was the matter of costs. The moving party plaintiff accepted that it would be responsible for costs but was unable to reach agreement on the quantum.
[3] I asked the parties to prepare outlines of costs and a concise summary of their arguments. This has been done. The difference between their respective positions is fairly wide: the unsuccessful moving party/plaintiff suggests $6,000 and notes that their own suggested “ask” for costs (before their lack of success in argument became apparent) had been slightly more than $5,000. The defendant/respondent seeks $34,719.
[4] I accept the summary of the court’s function in assessing costs offered by Mr. Wygodny from the decision of Myers J. in 2176693 Ontario et al. v. The Cora Franchise Group Inc. et al., 2015 ONSC 1265 (at para. 18):
[18] The fixing of costs is a discretionary decision under s.131 of the Courts of Justice Act. That discretion is generally to be exercised in accordance with the factors listed in Rule 57.01 of the Rules of Civil Procedure. These include the principle of indemnity for the successful party (57.01(1)(0.a)), the expectations of the unsuccessful party (57.01(1)(0.b)), the amount claimed and recovered (57.01(1)(a)), and the complexity of the issues (57.01(1)(c)). Overall, the court is required to consider what is “fair and reasonable” in fixing costs, and is to do so with a view to balancing compensation of the successful party with the goal of fostering access to justice: Boucher v Public Accountants Council (Ontario), 2004 CanLII 14579 (ON CA), (2004), 71 O.R. (3d) 291, at paras 26, 37.
[5] The essence of the dispute between the parties is whether the portion of the residential construction project known as “Cathedraltown” undertaken by the defendants violated any of the contractual undertakings to which it was bound by agreements with the plaintiff. The project is now entirely built and sold to the end-owners who have moved into their homes. Whether the project be complementary to the Cathedral or a blot upon it, it is fully built and the remedy, if any, of the plaintiff will hereafter have to be in damages. I intend in no way to disparage the plaintiff’s deep-seated and sincerely held belief that the development project undertaken by the defendants was both a breach of contract and a profound disappointment to her. The cathedral project conceived of by Mr. Roman and completed by his daughter was intended to be a lasting legacy and tribute to the very full and successful life of a Canadian entrepreneur. My only point is that the dispute which lies at the core of the lis between the parties was in no way advanced by this motion for partial summary judgment which touched upon no central issue to the case. It was, in a word, peripheral.
[6] The partial summary judgment motion in this case related to use of copyright materials during the marketing phase of the project (i.e. when being sold to the ultimate purchasers). That phase was long over and done with before the matter came on for a hearing (it was not entirely clear to me whether any portion was still on going when the case began, but nothing turns on it). There was no claim for any damages flowing from the alleged breach of copyright – the plaintiff merely sought a declaration that a breach had occurred and sought to leave damages to be determined another day.
[7] As I pointed out to the plaintiff in argument, it is hard – bordering on impossible – to imagine what specific damages might be said to flow from the alleged breaches of copyright even if found. I pass over in silence the singular fact that the record before me failed to establish that the plaintiff even owned copyright in the materials at issue since both parties appeared willing to act as if they did. With the marketing phase now long over and done with, no injunction to bar future breaches is necessary or material. I cannot conceive of how the object of this motion could ever have been material. The alleged breaches – use of the wrong shade of blue, use of a logo in the wrong position on a brochure and similar matters – might, if proved, have given rise to nominal damages. If the plaintiff had a theory of damages that might result in more than nominal damages arising from the alleged breaches, I am sure the court will hear of it in due course. My ruling on costs obviously has no impact on whatever theory of damages the plaintiff may see fit to pursue in the future in this regard. It is sufficient for my purposes here to note that the theory that might give rise to material damages is sufficiently subtle or obscure as to have left me grave doubts as to whether the motion ought to have been brought in the first place. Damages were not on the table in the motion, it is true, but the plaintiff made no effort to persuade me of the existence of a valid theory of damages when I suggested to him that the only remedy he was on the path to seeking was nominal damages.
[8] Whether a valid theory of damages can be advanced or not, the subject-matter of the partial summary judgment motion was at all times entirely peripheral to the main thrust of the action which was to seek redress for the alleged stain on the legacy of Mr. Roman and his Cathedral that this portion at least of the Cathedraltown project as ultimately executed allegedly became.
[9] I noted to Mr. Wygodny in argument that his client had commenced this claim in 2011 and this motion for partial summary judgment on an issue of no possible bearing on the main issues in the claim was coming on for a hearing in early 2015. The intervening years have been entirely consumed with on on-again, off-again effort to get this motion ready for hearing. A greater waste of the resources of the parties and the court would be hard to conceive of. Almost four years after commencing the case, the plaintiff will only now begin to advance it through discoveries and towards an ultimate trial.
[10] If the purpose of partial summary judgment motions is to decide issues which will shorten the procedure or otherwise materially advance the resolution of the case, this motion was the antithesis of that public policy purpose. Unnecessary delay of this sort introduced in the process of advancing a case towards resolution almost approaches the level of a per se abuse of process.
[11] The respondent’s costs outline contains a summary of the various steps in the procedure relating specifically to this motion for partial summary judgment. There were three separate scheduling appearances related to this motion – at least two of which were to seek a new schedule necessitated by the plaintiff either not being ready or filing responding material with considerable delay. There were affidavits exchanged, cross-examinations held, undertakings and the full arsenal of pre-hearing steps that might precede a motion for partial summary judgment.
[12] The tortured and in my view entirely unnecessary nature of this motion coupled with its obvious infliction of considerable loss of time and expense upon the defendants who were compelled to respond to it suggest to me that an award of costs on the substantial indemnity scale pursuant to Rule 20.06 is warranted.
[13] This motion should never have been brought. Motions that should never have been brought should be discouraged and the main tool at our disposal to discourage abuse of the summary judgment process is Rule 20.06 and costs. That is not to say that every unsuccessful summary judgment motion ought to be disposed of with a higher scale of costs. Pursuant to Rule 20.06, the court must be satisfied that the motion was brought (or resisted) in bad faith or that the motion ought not to have been brought or resisted in the first place. That is not an insignificant hurdle nor one which ought to frighten the litigant of modest means seeking to employ summary judgment to obtain access to justice on terms that are reasonable and appropriate. I am satisfied that Rule 20.06 can and should be applied in these circumstances.
[14] The outline of costs seeks $34,719 in fees and disbursements on a substantial indemnity basis. Having regard to the peripheral nature of the issues on the motion I am not satisfied that a very large portion of the charges for counsel time claimed would have incurred in any event in getting the matter ready for trial. I am prepared to discount the claimed amount somewhat reflecting the duplication of effort that multiple counsel charging time would suggest as well as the fact that some charged time will have been directed to the “main” issues as well as the motion. In the circumstances, I have decided to reduce the claimed fee amount by $5,000 inclusive of HST in total.
[15] Accordingly, I allow the costs claim at $29,719.12 inclusive of HST. The plaintiff is to pay this amount to the defendant forthwith.
Sean F. Dunphy, J.
Date: March 25, 2015