CITATION: Pittiglio v. Pittiglio, 2015 ONSC 3603
NEWMARKET COURT FILE NO.: FC-13-44489-00
DATE: 20150604
SUPERIOR COURT OF JUSTICE – ONTARIO – FAMILY COURT
RE: Maria Acocella Pittiglio, Applicant
and
Robert Pittiglio, Respondent
BEFORE: The Honourable Mr. Justice J.P.L. McDermot
COUNSEL: Judith Holzman, for the Applicant
Jagjit S. Bhathal, for the Respondent
HEARD: June 2, 2015
COSTS ENDORSEMENT
[1] On May 21, 2015, I issued my endorsement adjourning this trial. This was a last minute adjournment, and I attributed much of the responsibility for this adjournment to the respondent, Mr. Pittiglio. Even though he was successful in his motion for an adjournment, I ordered that he pay “costs thrown away for preparation for the trial as well as this motion,” payable forthwith.
[2] The parties argued the issue of quantum of the costs on June 2, 2015.
[3] The applicant claims costs of $56,072 plus disbursements of $55,286.50 for a total of $112,149.50. With HST, the applicant claims costs thrown away in the amount of $125,835.66.
[4] During argument, Ms. Holzman acknowledged that the report prepared by Kalex regarding stock options which cost $5,000 would be usable at trial. As well, she also acknowledged that the bill of costs included costs for the motion heard by McGee J. in the amount of $12,702.50; those costs cannot be included because McGee J. reserved costs to the trial judge which I am not. With HST, both of these together totaled $20,003.83. This means that the claim for costs thrown away is reduced to $105,831.83 inclusive of HST.
[5] The parties agreed on the definition of costs thrown away. It has been considered on a number of occasions, often in the civil context where there has been a mistrial or a trial has had to be adjourned as in the present case. Effectively, the phrase “costs thrown away” refers to a party’s costs for trial preparation which have been wasted and will have to be redone as a result of the adjournment of the trial: see Hossny v. Belair Insurance Co., 2010 ONSC 102 at para. 35, and Middleton v. Jaggee Transport Ltd., 2014 ONSC 3014 at para. 7. The costs are generally payable on a full or substantial recovery basis: see Smith v. Harrington, [1994] O.J. No. 2985 (Gen. Div.) at para. 9 and Hossny v. Belair Insurance Co., supra at para. 35.
[6] Importantly, the intent of an award of costs thrown away is to indemnify a party for the wasted time for trial preparation arising from the adjournment; hence the fact that these awards are usually on a substantial recovery basis. These costs are, however, not intended to “punish or vilify”: see Kalkanis v. Kalkanis, 2014 ONSC 205 at para. 3. This is important because Ms. Holzman claims costs for her attempts to obtain disclosure which I ruled that Mr. Pittligio was deficient. Ms. Pittiglio may very well have a right to costs for her attempts to obtain disclosure, but these costs are not “thrown away” because of the adjournment of the trial as these costs resulted in the disclosure which will ultimately be used at trial, whenever the trial takes place. The work will not have to be redone because of the adjournment. Those costs are, therefore, for the trial judge, and not the subject matter of my award of costs thrown away.
[7] Accordingly, I must firstly review the dockets provided by Ms. Holzman in order to determine the time claimed for trial preparation which has now been wasted.
[8] Ms. Holzman stated that she went through her time sheets and highlighted the costs which were for trial preparation which was wasted as a result of the adjournment. This is not, however, apparent from the dockets. I accept the suggestion of Mr. Bhathal that the dockets be divided into three segments, as the costs claimed go back too soon after Ms. Holzman was retained, in late February 2015. I intend to review the dockets to determine whether the costs relate to trial preparation were wasted because of the adjournment.
[9] I will separately review the issue of disbursements claimed, including photocopying expenses that exceed $2,000, and the cost of the business valuation reports.
February 24 to April 14, 2015
[10] This portion of the bill of costs ends with the motion for leave that was held before MacDougall J. heard on April 13, 2015. That motion resulted in the motion before McGee J. heard on April 22, 2015. Costs of the MacDougall J. motion were reserved and are similarly not “thrown away” as that work will not have to be redone.
[11] Although the time spent in court on that motion is not included in the bill of costs, it appears that much of this portion of the bill of costs consists of work done which is related to that motion. For example, there are significant blocks of time spent on the file respecting the leave motion on March 25 and 26 and April 2 and 10, 2015. None of this is chargeable to costs thrown away for the reasons discussed above.
[12] There is also work done on the file during this time regarding the husband’s disclosure: see the time entry for March 24, 2015, for example. I have already noted that the disclosure costs are not thrown away as they had the result of obtaining disclosure, which can be used at trial or by the business valuator.
[13] There are also blocks of time respecting the transfer of the file to Ms. Holzman’s office; see the significant time entry of 8 hours on March 20, 2015. Again, this can hardly be seen as trial costs thrown away.
[14] In sum, I could not find any docket entries during this period of time which fit within the definition of “costs thrown away” discussed above.
April 14 to 22, 2015
[15] In argument, it was acknowledged that the time entries during this period of time were related to the motion heard by McGee J. on April 22, 2015. These costs were reserved to the trial judge and are not part of my award of costs thrown away.
April 23 to May 20, 2015
[16] During this time period, Ms. Holzman’s office spent a substantial amount of time in preparation for trial. Specifically, it appears that members of Ms. Holzman’s firm worked on preparation of exhibit books, Net Family Property (“NFP”) statements, as well as interviews with the business valuators and legal research. The time entries from May 11 to May 19 are largely related to trial preparation. After this date, Ms. Holzman worked on the adjournment motion, which will be considered separately.
[17] It is difficult to know how much of this time will be wasted due to passage of time, and how much is not. It is not apparent from the dockets themselves as to what work will need to be done over and what will not. It is an intuitive, rather than a scientific, process.
[18] Between May 11 and May 19, 2015, the time spent on trial preparation appears to total $22,595. Much of this work will have to be repeated. For example, the meeting with the experts will have to be repeated; it is apparent that the Kalex report will be revised as further disclosure comes in. The exhibit books will most likely change as further disclosure comes in. The NFP briefs will have to be amended, partly to respond to the new disclosure and final reports, and as well, to respond to the report that Mr. Bhathal intends to obtain. The only work done which may not have to be redone is the legal research which totals $1,370.
[19] Taking this into account, I am going to award $18,000 in costs thrown away. This is calculated on a substantial recovery basis. This is greatly in excess of what Mr. Bhathal suggested as a figure; he had suggested that a maximum of $2,500 should be awarded. He underestimates, in my opinion, what will have to be repeated when this matter is called for trial. In my view, the exhibit books, NFP statements and witness preparation, will all have to be revisited and revised substantially in November of this year, as much will have changed between now and then.
[20] In addition, I awarded Ms. Holzman’s client the costs of the motion that I heard on May 18, 2015. That is not based upon a full or substantial recovery basis; these are costs of a motion which would normally be assessed at a partial recovery rate.
[21] The time spent on the motion between May 20 and 21 totals $3,475. On a partial recovery basis, Ms. Pittiglio shall have her costs of the motion in the amount of $2,000.
[22] With HST, the costs of the motion and costs thrown away, excluding disbursements, are $22,260.
Disbursements
[23] The major disbursement claimed by Ms. Holzman was the cost of Kalex, which is the business and income valuator retained by Ms. Pittiglio. Several reports have been produced. There was a preliminary report which cost $26,000. Kalex is in the process of preparing an updated report, which Ms. Holzman intended to use at trial, at a cost of $17,000. There is also a date of marriage report regarding the husband’s business which cost $4,000.
[24] In argument, when pressed, Ms. Holzman agreed that a certain amount of work would not have to be repeated. She suggested that one half of the Kalex costs, or $23,500, be included in the claim for costs thrown away.
[25] I disagree. I note firstly, that Ms. Holzman had intended to rely upon the Kalex reports at trial. Although there may have to be further amendments prior to trial, the reports must have been satisfactory to some extent as counsel was content to use them at trial. Secondly, there is no evidence that the preliminary report was a cost that was “thrown away” as this work would not be repeated whenever the trial took place.
[26] There would have been a certain amount of time spent by Kalex in preparation for trial and in attempting to expedite the final report for trial, which will have to be repeated in November, 2015. I am going to grant costs of $5,000 for costs of Kalex thrown away as a result of the adjournment of the trial.
[27] Ms. Holzman also claims photocopying charges of $2,571.25. She says that this is respecting exhibit books prepared for trial which will all have to be redone.
[28] I agree that the exhibit books will have to be redone, at least to some extent. However, the accounts include the costs of two motions which are not part of this costs award. I will award $1,000 for photocopying charges.
[29] The other disbursements do not appear to be related to trial preparation or may be in respect of the motions which I have disallowed. I decline to award any further disbursements as part of this costs award.
[30] With HST, the disbursements for Kalex and photocopying total $6,780.
Conclusion
[31] Accordingly, costs thrown away plus the costs of the motion inclusive of disbursements and HST, are payable by the respondent in the amount of $29,040.
[32] I had ordered that costs be payable forthwith. Ms. Holzman requested a date that these costs be payable by because she is afraid that there will be a disagreement as to what is meant by “forthwith.” Forthwith means immediately. Costs payable within five business days.
Mr. Justice J.P.L. McDermot
Released: June 4, 2015