COURT FILE NO.: CV-14-514949

DATE: 20151109

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: MIGUNA MIGUNA, Plaintiff

AND:

WALMART CANADA CORP., WALMART STORES INC. and CONSORTIUM BOOK SALES AND DISTRIBUTION, LLC, Defendants

BEFORE: Mr. Justice Graeme Mew

COUNSEL: Miguna, Plaintiff, In Person

Antonio Turco and Sarah O’Grady, for Walmart Canada Corp. and Walmart Stores Inc.

Ilan Ishai, for Consortium Book Sales and Distribution, LLC

HEARD: In Writing

ENDORSEMENT on costs

[1] For reasons released on 18 September 2015 (2015 ONSC 5744), I granted the summary judgment motions brought by Consortium Book Sales and Distribution, LLC (“Consortium”) and Wal-Mart Stores Inc. (“Wal-Mart Stores”) dismissing the plaintiff’s action for breach of copyright and related relief.

[2] At the conclusion of oral argument of the motions, each of the parties provided costs outlines (a corrected costs outline was subsequently provided by the plaintiff).

[3] The costs outlines provided by the defendants addressed only the motions. The costs outline provided by the plaintiff appears to go well beyond the motions. In any event, given my decision to dismiss the plaintiff’s action, I invited all parties to make, and all parties have delivered, written submissions on not only the costs of the motions but, also, of the balance of the action.

[4] The successful defendants seek their costs of the motions and of the action on a partial indemnity scale. Consortium seeks $101,735.76 (inclusive of HST and disbursements). Walmart Stores seeks $53,267.80 (inclusive of HST and disbursements).

[5] The plaintiff is a self-represented litigant. However, he is also a qualified lawyer in both Ontario and Kenya. Applying what is described in his costs outline as his “actual rate” he claims that the value of the time spent by him amounts to $202,357 plus HST and disbursements of $20,651.56.

[6] In my reasons for decision on the motion I indicated that I was provisionally of the view that the defendants should have their costs of the motion and of the action on a partial indemnity basis.

Applicable Principles

[7] The general principles to be applied in fixing costs were articulated in Agius v. Home Depot Holdings Inc., 2011 ONSC 5272, at paras. 10-12, as follows:

Cumming J. in DUCA Financial Services Credit Union Ltd. v. Bozzo, 2010 ONSC 4601 at para. 5, described the “normative approach” to an application for costs:

Costs are in the discretion of the Court: s. 131, Courts of Justice Act, R.S.O. 1990, c. C.43 and Rule 57.01 of the Rules of Civil Procedure. In Ontario, the normative approach is first, that costs follow the event, premised upon a two-way, or loser pay, costs approach; second, that costs are awarded on a partial indemnity basis; and third, that costs are payable forthwith, i.e. within 30 days. Discretion can, of course, be exercised in exceptional circumstances to depart from any one or more of these norms.

Fixing of costs is not merely a mechanical exercise in reviewing the receiving party’s Cost Outline. In Andersen v. St. Jude Medical Inc. (2006), 2006 85158 (ON SCDC), 264 D.L.R. (4th) 557, the Divisional Court set out several principles to be considered in making an award of costs:

1. The discretion of the court must be exercised in light of the specific facts and circumstances of the case in relation to the factors set out in rule 57.01(1): Boucher [Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291], Moon [Moon v. Sher (2004), 2004 39005 (ON CA), 246 D.L.R. (4th) 440], and Coldmatic Refrigeration of Canada Ltd. v. Leveltek Processing LLC (2005), 2005 1042 (ON CA), 75 O.R. (3d) 638 (C.A.).

2. A consideration of experience, rates charged and hours spent is appropriate, but is subject to the overriding principle of reasonableness as applied to the factual matrix of the particular case: Boucher. The quantum should reflect an amount the court considers to be fair and reasonable rather than any exact measure of the actual costs to the successful litigant: Zesta Engineering Ltd. v. Cloutier (2002), 119 A.C.W.S. (3d) 341 (Ont. C.A.), at para. 4.

3. The reasonable expectation of the unsuccessful party is one of the factors to be considered in determining an amount that is fair and reasonable: rule 57.01(1)(0.b).

4. The court should seek to avoid inconsistency with comparable awards in other cases. “Like cases, [if they can be found], should conclude with like substantive results”: Murano v. Bank of Montreal (1998), 1998 5633 (ON CA), 41 O.R. (3d) 222 (C.A.), at p. 249.

5. The court should seek to balance the indemnity principle with the fundamental objective of access to justice: Boucher.

The Court of Appeal has identified the overriding principle to be that the amount of costs awarded be reasonable in the circumstances. In Davies v. Clarington (Municipality) (2009), 2009 ONCA 722, 100 O.R. (3d) 66 Epstein J.A. stated at paras. 51-52:

As can be seen, the overriding principle is reasonableness. If the judge fails to consider the reasonableness of the costs award, then the result can be contrary to the fundamental objective of access to justice. Rather than engage in a purely mathematical exercise, the judge awarding costs should reflect on what the court views as a reasonable amount that should be paid by the unsuccessful party rather than any exact measure of the actual costs of the successful litigant. In Boucher, this court emphasized the importance of fixing costs in an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding at para. 37, where Armstrong J.A. said “[t]he failure to refer, in assessing costs, to the overriding principle of reasonableness, can produce a result that is contrary to the fundamental objective of access to justice.”

Scale of Costs and to Whom Payable

[8] The defendants, in their costs submissions, each indicate that while there would be an arguable case for awarding costs on a substantial indemnity basis (principally because of the plaintiff’s continued allegations of deception and misconduct on the part of the defendants), they are prepared to concede that costs on a partial indemnity basis would be appropriate.

[9] Both defendants offered to settle their respective summary judgment motions on the basis of a dismissal of the action without costs. They submit that I should consider exercising the discretion provided to me by rule 49.13 to consider and elevate the award of costs from the date that the offers were made. As the authors of Ontario Superior Court Practice 2016 (LexisNexis) note, at p. 1514:

Rule 49.13 gives the court discretion to take cognizance of an offer that was comparatively close to what the court awarded, and reflects such fact by adjusting costs accordingly.

[10] The plaintiff argues that there should be no costs. In that regard, the plaintiff refers to his modest means compared to those of the corporate defendants as well as to his good faith in prosecuting his claims against the defendants.

[11] I see no reason to depart from the normative approach described by Cumming J. in DUCA Financial Services Credit Union Ltd. v. Bozzo, cited above.

[12] Furthermore, while I have considered the delivery of “drop hands” settlement offers as one of the many factors to be taken into account in determining overall reasonableness of the costs to be awarded, I would not direct that costs incurred after the offers were made should be awarded on a different scale.

[13] The defendants shall, accordingly, be awarded their costs of the motion and of the action on a partial indemnity scale.

Amount of Costs

[14] In terms of quantum, Walmart utilised rates calculated in accordance with the former costs grid. Consortium, on the other hand, calculated its partial indemnity rate on the basis of 60% and of the actual rates charged by the fee earners involved.

[15] The plaintiff argues that should the court be inclined to order the costs, such costs should be modest and be fixed at no more than a third of what each party claims.

[16] The plaintiff claims to be a person of modest means who was compelled to bring his action due to legitimate grievances that he could not have taken to any other forum.

[17] 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) 114 O.R. (3d) 551), such circumstances will be few and far between and will require evidence not only that the plaintiff does not currently possess the financial wherewithal to pay an award of costs but it is most unlikely that he will ever acquire the ability to meet a costs burden arising from this case. Beyond the bald statement by the plaintiff that he is a person of “modest means”, there is no such evidence here.

[18] Furthermore, as an experienced lawyer, the plaintiff knew full well that by bringing this action he was exposing himself to the possibility of a significant award of costs. One need look no further than the plaintiff’s own estimate of the costs he has incurred in relation to the action.

[19] Consequently, I do not consider the plaintiff’s means to be a factor which should affect determination of the appropriate quantum of costs to be paid to the defendants in the present case.

[20] The plaintiff raises a number of arguments which, applying the factors set out in Andersen v. St. Jude Medical Inc. (quoted above), he says I should consider in deciding what the appropriate quantum of costs payable to each of the defendants should be. In particular, he raises the following points.

(a) The plaintiff was forced to bring a motion to amend his statement of claim because the defendants would not consent;

(b) The defendants should not be able to on the one hand claim that the case was straightforward and complex and on the other hand maintain that it required the involvement of multiple lawyers, resources and the time claimed in the costs outlines;

(c) Although the plaintiff brought a motion to stay the defendants’ summary judgment motions and to strike out their statements of defence, the only material filed was a notice of motion. Accordingly, the time spent by the defendants in relation to those motions would have been minimal;

(d) Although the plaintiff initially filed a 62 page factum in relation to the summary judgment motions, the factum was served but never filed and was replaced with a 30 page factum the same day (after it was pointed out by opposing counsel that the original factum exceeded the page limit). Accordingly, it is inconceivable that any time would have been spent by the defendants’ lawyers reviewing the original factum;

(e) Unlike the defendants, which served multiple factums and briefs of authorities, including one served less than four days before the scheduled hearing of the motions, the plaintiff only served one factum and one brief of authorities;

(f) Wal-Mart Stores had refused to deliver its productions for close to one year and only delivered two limited affidavits of documents with true copies of its Schedule A items days before the scheduled cross-examination of its witnesses. Similarly, Consortium delivered more than 1,000 pages of documents approximately three days before their witness was cross-examined;

(g) Wal-Mart Stores “deliberately” delivered four affidavits and witnesses for cross-examination when they could have delivered only two;

(h) The defendants truncated and complicated their witnesses’ cross-examinations;

(i) Consortium ignored the legal notice provided by the plaintiff until after it had been sued and Wal-Mart responded too late to the plaintiff’s notice and in an arrogant manner, leaving the plaintiff no option but to seek legal recourse;

(j) Despite the plaintiff having made full and complete disclosure, the defendants “continued to conceal material evidence and deny obvious facts”;

(k) The plaintiff has spent more than $20,000 in disbursements alone, mostly relating to the costs of cross-examination and the transcripts.

[21] I agree that the defendants should have consented to the proposed amendments to the statement of claim without the need for the plaintiff to bring a formal motion to amend.

[22] I also agree with the following submission made by the defendant, Wal-Mart Stores:

The Plaintiff complicated the proceedings with his voluminous documentation, unscheduled motions and persistent focus (in his evidence, cross-examinations and submissions) on facts and issues that have no bearing whatsoever on the alleged infringements by Wal-Mart. These strategies both added to the complexity of the proceeding and unnecessarily lengthened the duration of the proceeding.

[23] As the Court of Appeal reminds us in the Davies v. Clarington (Municipality) case (cited above), the overriding principle is reasonableness.

[24] Rule 1.04(1.1) also requires that orders made should be proportionate to the importance and complexity of the issues, and to the amount involved in the proceeding. In considering the application of the proportionality principle to the costs of these motions, I have concluded that it would be disproportionate to award one of the successful moving parties virtually double the amount awarded to the other (which is what Consortium effectively invites me to do).

[25] Taking into account all of the factors indicated above, I have concluded that reasonable awards of costs in favour of the successful parties should be as follows:

a. Wal-Mart Stores - $50,000 (inclusive of disbursements and HST)

b. Consortium - $70,000 (inclusive of disbursements and HST).

Mew J.

Date: 9 November 2015