Court File and Parties

CITATION: College of Traditional Chinese Medicine et al. v. Federation of Ontario et al., 2015 ONSC 2262

COURT FILE NO.: CV-14-501514

DATE: 20150409

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: COLLEGE OF TRADITIONAL CHINESE MEDICINE PRACTITIONERS AND ACUPUNCTURISTS OF ONTARIO, Applicant

AND:

THE FEDERATION OF ONTARIO TRADITIONAL CHINESE MEDICINE ASSOCIATION a.k.a. THE COMMITTEE OF TRADITIONAL CHINESE MEDICINE PRACTITIONERS AND ACUPUNCTURISTS OF ONTARIO, THE ONTARIO ACUPUNCTURE EXAMINATION COMMITTEE, THE COLLEGE OF TRADITIONAL CHINESE MEDICINE AND PHARMACOLOGY CANADA, CANADIAN ASSOCIATION OF ACUPUNCTURE AND TRADITIONAL CHINESE MEDICINE, COMMITTEE FOR CERTIFIED ACUPUNCTURISTS OF ONTARIO, CHINESE MEDICINE & ACUPUNCTURISTS OF ONTARIO, CHINESE MEDICINE & ACUPUNCTURE CLINIC OF TORONTO, JAMES X.N. YUAN, JIA LI AND ZHI HONG ZHAO, Respondents

BEFORE: Mr. Justice Graeme Mew

COUNSEL: J. Thomas Curry, for the Applicant Sean Hu, In Person (as representative of the corporate respondents with leave granted under Rule 15.01(2))

HEARD: In Writing

COSTS ENDORSEMENT

[1] The applicant has requested its costs resulting from its successful motion for interim and interlocutory injunctions against the respondents and of the application itself, in which permanent injunctive relief was obtained.

[2] The motion was argued on 26 May 2014 ((reasons for decision released on 2 June 2104 and reported at 2014 ONSC 3334).

[3] The application proper was heard over the course of two days. In reasons released on 6 February 2015, the application was granted, with the result that the corporate respondents were permanently enjoined from holding themselves out as bodies that regulate traditional Chinese medicine and acupuncture in Ontario, and the individual respondents were restrained from holding themselves out as representatives of any regulator, using the title “Dr.” or holding themselves out as persons who are qualified to practice in Ontario as a traditional Chinese medicine practitioner or acupuncturist: reasons for decision reported at 2015 ONSC 661.

[4] The applicant College is authorized by provincial legislation as the sole regulator of the practice of traditional Chinese medicine and acupuncture in Ontario. The establishment of the College was controversial. The respondents identify themselves as members of a group within the traditional Chinese medicine community who feel that, as “ethnic mainland Chinese” people, they have been discriminated against by the College. Specifically, they raise concerns about the composition of the College and committees of the College, the senior management of the College and barriers to entry to the profession which they say prevent many otherwise qualified ethnic mainland Chinese individuals from being able to practice because of their lack of English language skills.

[5] These allegations were central to the motion and application before me. However, similar allegations were also raised by substantially the same parties as the respondents in the present case in another matter which was heard by the Divisional Court: Yuan v. Transitional Council of the College of the Traditional Chinese Medicine Practitioners and Acupuncturists of Ontario 2014 ONSC 351.

[6] While the respondents suggest that in the matter heard by me the allegations of discrimination were more refined (alleging discrimination against “ethnic mainland Chinese” people as opposed to “Mandarin speakers”). I concluded that in the Divisional Court matter the respondents had already unsuccessfully challenged the constitutionality of the applicable legislation and that, not having appealed the Divisional Court decision, they could not simply try again in another proceeding. In coming to this conclusion, I applied the principles of issue estoppel.

[7] The College had raised the matter of issue estoppel from the outset in relation to this proceeding. The subject featured in the submissions made by the College on the motion as well as on the application.

[8] This proceeding has consumed a significant amount of time and effort on the part of the parties and their representatives. The College has asked that costs of the application be fixed on a partial indemnity scale in the amount of $161,066.96.

[9] In exercising the court’s discretion to award costs, consideration may be given to the factors set out in Rule 57.01 of the Rules of Civil Procedure, in addition to the result of the proceeding. Those factors include:

• The principle of indemnity
• The amount that an unsuccessful party could reasonably be expected to pay
• The complexity of the proceeding
• The importance of the issues
• The conduct of any party that attended to shorten or lengthen the proceeding unnecessarily, and
• Any other matter relevant to the question of costs.

[10] In considering the factors set out in Rule 57.01, the court should also have regard to the overarching principle of proportionality (Rule 1.04(1)) and to fixing an amount that is fair and reasonable to the parties against whom costs are awarded rather than an amount fixed by reference to the actual costs incurred by this successful litigant: Boucher v. Public Accountants of Ontario, 2004 14579 (ON CA), (2004), 71 O.R. (3d) 291 at para. 26.

[11] There is no doubt that this proceeding was important to both parties.

[12] The College, in accordance with its statutory mandate, seeks to enforce regulations which have the force of law in the Province of Ontario.

[13] The respondents raise matters of what they regard as important principle. They seek the court’s assistance to curb what they regard as an unfair and discriminatory exercise by the applicant of its statutory mandate.

[14] As I noted in my reasons for decision, at para. 53:

I was left in no doubt as to the sincerity of the respondents. At the risk of oversimplifying what they claim has happened to them, they believe that through a series of political machinations, which included flawed consultations and electrical processes, they and other members of the TCM community in Ontario have been systematically excluded from continuing their work and activities as members of the TCM community.

[15] In the exercise of its discretion to award costs, courts will often give special dispensation to individuals or groups who raise matters of public interest, including the constitutionality of primary and secondary legislation.

[16] In Mahar v. Rogers Cable Systems Ltd. (1995), 1995 7129 (ON SC), 25 O.R. (3d) 690, the applicant, who was a subscriber to the respondent’s cable service, applied for, among other things, declarations that the respondent had failed to provide notice of fee changes, that a portion of the fees charged violated the Broadcasting Act, S.C. 1991, c. 11, and for an order for a refund of unlawfully charged fees. The respondent moved for an order staying the application contending that the Canadian Radio-television and Telecommunications Commission (CRTC) had jurisdiction over the dispute. The court concluded that it did not have jurisdiction and dismissed the application. However, in relation to the issue of costs, Sharpe J. quoted Mark Orkin, The Law of Costs, 2^nd ed. (1994) at pp. 2-33 to 2-34:

An action or motion may be disposed of without costs when the question involved is a new one, not previously decided by the courts on the theory that there is a public benefit in having the court give a decision, or where it involves the interpretation of a new or ambiguous statute, or a new or uncertain or unsettled point of practice, or where there were no previous authoritative rulings by courts, or decided cases on point; or where the application concerned a matter of public interest and both parties acted in complete good faith….

[17] Sharpe J. continued, at p. 704:

The issue raised was novel and certainly involved a matter of public interest. While I decided the jurisdictional point against the applicant, I am satisfied that the application was brought in good faith for the genuine purpose of having a point of law of general public interest result. It is true that many of the cases in which an unsuccessful public interest litigant has been relieved of the usual costs order have involved suits against the government and the respondent here is a private entity. However, the respondent does enjoy the substantial benefit and protection of a statutory monopoly in the provision of its services to the public, and this application was brought in relation to an important aspect of the terms on which that monopoly is enjoyed. While the targets of public interest litigation are certainly entitled to the protection of the rules of court, it should not be given that those should not be forgotten but those rules include a discretion to relieve the loser of the burden of paying the winner’s party and party costs.

[18] The applicant asserts that there is no reason that costs should not follow the event, given the history of litigation between the parties and, in particular, the unsuccessful Divisional Court application involving many of the parties to the current application (in respect of which, the applicant notes, there is an outstanding unpaid award of costs). Furthermore, although the amount claimed in costs is significant, it is said to be a fair reflection of the time and effort required to respond to a proceeding which was strenuously and tenaciously fought by the respondents.

[19] The respondents, not surprisingly, submit that their constitutional challenge in this proceeding advances a matter of public interest affecting not only the respondents but hundreds of other ethnic mainland Chinese practitioners. The respondents also say that they could not reasonably expect to pay the amount of costs being asked by the College. They were represented by a non-lawyer spokesperson in defending the present application because they did not have sufficient funds to retain a lawyer.

[20] While there are circumstances in which the inability of a party to pay costs may be a relevant factor in determining whether an adverse costs award should be made (see, for example, Baines v. Hehar 2013 ONSC 849, 2013 ON SC 849, (2013), 114 O.R. (3d) 551), such circumstances will be few and far between and will require evidence not only that the respondents do not currently possess the financial wherewithal to pay an award of costs but that it is most unlikely that they will ever acquire the ability to meet a costs burden arising from this case. Beyond the bald statement by the respondents that they cannot pay, there is no such evidence here.

[21] However, even if I was persuaded that the respondents do not have the means to pay an award of costs, the fact is that they mounted a comprehensive and uncompromising defence to the application and continued with it in the face of multiple warnings from the applicant that the constitutionality of the regulations was a matter that could not be re-litigated by them. It seems to me most unlikely that the respondents have not considered that their efforts would be better employed through engaging political processes, either within the College or by lobbying for appropriate changes to the legislation.

[22] Of course, in the present application, the respondents were just that. They were responding to an application brought by the College. This stands in contrast to the proceeding before the Divisional Court in which some of them applied to the court for relief. But the essence of their defence in this application was the same line of argument that had failed in the Divisional Court. Parties cannot expect to re-litigate issues that have already been decided by the court without accepting responsibility for the costs consequences of doing so. The factors discussed in Mahar v. Rogers Cable Systems Ltd. do not apply to the respondents’ second attempt to defeat the legislation in question.

[23] I therefore find no reason in principle not to make an award of costs in favour of the applicant in this case.

[24] In terms of the quantum of costs, the bill of costs provided by the applicant’s lawyers indicates that 530 hours of fee-earners’ time was spent on the application (including the motion). While this may accurately reflect the time spent, some of it, no doubt, also reflecting the fact that the respondents were not legally represented and, hence, that various aspects of the proceeding took longer as a result, I would not regard a proper application of the principles set out in Boucher, or that of proportionality, as supportive of the amount claimed.

[25] In my view, an amount that is fair and reasonable to the respondents, who, as I have said, must take some responsibility for the very considerable costs that they have caused to be incurred by the applicant, would be the sum of $75,000 inclusive of disbursements and taxes.

[26] For the foregoing reasons, the respondents (other than Zhi Hong Zhao) shall pay the College costs of the application (including the motion for interim relief) fixed in the amount of $75,000.

Graeme Mew J.

Date: 9 April 2015