CITATION: Airia Brands v. Air Canada, 2016 ONSC 1220
COURT FILE NO.: 50389CP
DATE: 2016/02/29
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Airia Brands Inc., Startech.Com Ltd., and QCS-Quick Cargo Service GMBH
Plaintiffs
- and -
Air Canada, AC Cargo Limited Partnership, Societe Air France, Koninklijke Luchtvaart Maatschappij N.V. dba KLM, Royal Dutch Airlines, Asiana Airlines Inc., British Airways PLC, Cathay Pacific Airways Ltd., Deutsche Lufthansa AG, Lufthansa Cargo AG, Japan Airlines International Co., Ltd., Scandinavian Airlines System, Korean Air Lines Co., Ltd., Cargolux Airline International, LAN Airlines S.A, LAN Cargo S.A., Atlas Air Worldwide Holdings Inc., Polar Air Cargo Inc., Singapore Airlines Ltd., Singapore Airlines Cargo PTE Ltd., Swiss International Air Lines Ltd., Quantas Airways Limited, and Martinair Holland N.V.
Defendants
Charles Wright, on behalf of the plaintiffs
Danielle Royal, on behalf of the defendant Air Canada, AC Cargo Limited Partnership and appearing as agent for counsel for British Airways PLC
HEARD: January 22, 2016 Written Submissions – December 17 and December 22, 2015, January 13, January 19, and January 20, 2016
Conference Call February 10, 2016
LEITCH J.:
RE: COSTS ON CERTIFICATION AND JURISDICTION MOTIONS AND FINAL ORDERS ON THOSE MOTIONS
[1] Counsel advised that they had reached agreement on the methods by which Absent Foreign Claimants may consent to the jurisdiction of this court. This attornment order, which essentially describes how Absent Foreign Claimants may expressly consent to the jurisdiction of this court, is approved.
[2] Counsel also advised that the form of order in relation to the jurisdiction motion and the certification motion have been agreed to by all counsel. The only outstanding issue is the issue of costs in relation to each of those motions. Put simply, the plaintiffs were successful on the certification motion while the defendants were successful on the jurisdiction motion.
[3] Since the certification motion and jurisdiction motion were heard, the plaintiffs entered into settlements with Asiana Airlines Inc., Korean Airlines Co. Ltd. and Cathay Pacific Airways Ltd. As a result, while there were five groups of defendants who made submissions on the certification and jurisdiction motions, only two groups of defendants remain.
[4] In their first submission on costs, the plaintiffs claimed $616,976.46 plus applicable taxes for legal fees and disbursements and requested that an award for such costs be made jointly and severally against the defendants, Air Canada, A. C. Cargo Limited Partnership (“Air Canada”) and British Airways PLC (“British Airways”), which are the only defendants remaining in the action.
[5] The fees sought reflected a partial indemnity recovery of $286,188.38 on account of legal fees and $330,788.08 for disbursements, the largest portion of which related to expert fees.
[6] After considering the submissions made on behalf of Air Canada and British Airways, the plaintiffs reconsidered their costs submissions and reduced their requested costs on the certification motion to $268,301.22 (inclusive of taxes) being 2/5 of the amount originally requested.
[7] Air Canada and British Airways seek their costs on the jurisdiction motion in the amount of $228,575.05 all inclusive.
[8] The position of Air Canada and British Airways is that the jurisdiction motion was more complex than the certification motion involving a more voluminous record and more affidavit evidence from experts. They take the position that equal amounts of time were spent on both motions and no costs should be awarded in relation to each motion or equal amounts should be awarded on each motion so that costs can be off set.
[9] On the other hand, the plaintiffs urge me to award costs on each motion because of the pending appeals of the jurisdiction and certification motions. Further, the plaintiffs’ position is that Air Canada and British Airways are only entitled to costs on the jurisdiction motion in the amount of $125,000. In relation to the certification motion, they submit that a 60 percent reduction in their original costs request is a generous reduction because the two largest defendants are arguably British Airways and Air Canada.
[10] I will first address the issue of costs to be awarded on the jurisdiction motion. I have taken into account, as the plaintiffs emphasized, that counsel for Cathay Pacific Ltd. played a significant role in relation to the jurisdiction motion and he is not seeking costs. However, while counsel for Cathay presented the arguments on the jurisdiction motion, the defendants all obtained foreign law affidavits and jointly filed the motion records, factum, briefs of authorities and compendium.
[11] I agree with the submission of counsel for Air Canada and British Airways that the jurisdiction motion was very complicated with extensive legal issues that required extensive legal submissions and in addition there had been procedural issues advanced by the plaintiff prior to the motion being heard.
[12] I note the exception taken by counsel for Air Canada to the plaintiffs’ submission that their costs are unreasonable given that costs for only two lawyers has been charged, whereas the plaintiffs have charged time for five lawyers. In any event, I accept that the time claimed by counsel for British Airways and Air Canada is justifiable given the issues.
[13] As a result I fix the costs payable by the plaintiffs to British Airways and Air Canada in the amount sought, $228,575.05 all inclusive, which I find to be reasonable and consistent with the expectations of the parties. I note that the plaintiffs’ partial indemnity time on the jurisdiction motion was $225,011.38 and $125,641.20 for disbursements.
[14] I turn next to the issue of costs on the certification motion. Prior to the hearing of the certification and jurisdiction motion the plaintiffs entered into settlement agreements with all but five of the defendants and $19 million dollars was paid for the benefit of class members. Class counsel has been paid legal fees and has been reimbursed for their disbursements from these settlement proceeds. As set out in the written submission on behalf of British Airways and Air Canada, class counsel has already been compensated for the costs of the certification motion (save and except for a relatively modest amount of time incurred in relation to the hearing of the motion) through the court’s approval of substantial legal fees (over $5.5 million) and reimbursement of all disbursements (including fees for experts retained in relation to the jurisdiction motion on which the plaintiffs are not entitled to costs).
[15] The plaintiffs acknowledge that class counsel has been reimbursed for their disbursements and has had their legal fees approved and paid in accordance with the retainer agreements as settlement money has been paid; however, they assert that the class is entitled to have its money repaid. The plaintiffs’ submission is there is no double recovery arising from their costs request on the certification motion. Rather, it is merely an indemnification of the class.
[16] I accept the plaintiffs’ proposition that recovering legal fees as settlements are entered into does not automatically disentitle class counsel from a costs award on a motion (or relieve a defendant from the obligation to pay costs). However, I agree with counsel for British Airways and Air Canada that the plaintiffs’ costs submission on this motion does not adequately take into account the prior settlements and the fact that all settling defendants paid significant amounts to settle their exposure, which included exposure to costs.
[17] In addition, while I agree with the plaintiffs’ submission that the breadth of the certification motion was clearly vast with “everything having put in issue by the defendants”, I do not agree with the plaintiffs’ assertion that the certification motion was the more complicated and difficult of the two motions.
[18] For these reasons, I cannot find the plaintiffs’ submission on costs to be fair and reasonable. I fix the costs payable by British Airways and Air Canada to the plaintiffs on the certification motion in the amount of $228,575.05 all-inclusive as proposed by Air Canada and British Airways.
[19] I observe that Air Canada and British Airways are not “getting a free ride” on the certification motion as the plaintiffs assert. The plaintiffs have been awarded a reasonable amount in costs considering all of the circumstances. However, I am also satisfied that Air Canada and British Airways are entitled to their costs on the jurisdiction motion as claimed.
[20] As a result, the two costs awards will be offset.
“Justice L. C. Leitch”
Justice L. C. Leitch
Released: February 29, 2016
CITATION: Airia Brands v. Air Canada, 2016 ONSC 1220
COURT FILE NO.: 50389CP
DATE: 2016/02/29
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Airia Brands Inc., Startech.Com Ltd., and QCS-Quick Cargo Service GMBH
- and -
Air Canada, AC Cargo Limited Partnership, Societe Air France, Koninklijke Luchtvaart Maatschappij N.V. dba KLM, Royal Dutch Airlines, Asiana Airlines Inc., British Airways PLC, Cathay Pacific Airways Ltd., Deutsche Lufthansa AG, Lufthansa Cargo AG, Japan Airlines International Co., Ltd., Scandinavian Airlines System, Korean Air Lines Co., Ltd., Cargolux Airline International, LAN Airlines S.A, LAN Cargo S.A., Atlas Air Worldwide Holdings Inc., Polar Air Cargo Inc., Singapore Airlines Ltd., Singapore Airlines Cargo PTE Ltd., Swiss International Air Lines Ltd., Quantas Airways Limited, and Martinair Holland N.V.
REASONS FOR JUDGMENT
LEITCH, J
Released: February 29, 2016