Court File and Parties

COURT FILE NO.: CV-11-5238 DATE: 2016/07/21 ONTARIO SUPERIOR COURT OF JUSTICE

B E T W E E N:

SEAL TECH BASEMENT SEALING INC. Plaintiff / Defendant by counterclaim

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JONATHAN PRYCHITKO and KERI PRYCHITKO Defendants / Plaintiffs by counterclaim

COUNSEL: Liam M. Sangster, for the Plaintiff / Defendant by counterclaim Scott R. Fairley, for the Defendants / Plaintiffs by counterclaim

BEFORE: The Honourable Mr. Justice David J. Nadeau

ADDENDUM ON COSTS

[1] Pursuant to my Reasons for Judgment released on March 16, 2016, the Plaintiffs by counterclaim seek their further costs for this trial and request that additional fees and disbursements be fixed at the all-inclusive sum of $59,582.17. The Defendant by counterclaim submits that the “fair and reasonable” amount of costs should only total $20,630.00, or a further sum of $15,630.00, in these specific circumstances.

[2] This Court must apply all of the factors in Rule 57 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, as well as the principles enunciated by the Ontario Court of Appeal in several cases including Boucher v. Public Accountants Council (Ontario), [2004] O.J. No. 2634. The suggested approach was that:

“…it is also necessary to step back and consider the result produced and question whether, in all the circumstances, the result is fair and reasonable. This approach was sanctioned by this court in Zesta Engineering Ltd. v. Cloutier (2002), 21 C.C.E.L. (3d) 161 (Ont. C.A.) at para. 4 where it said:

In our view, the costs award should reflect more what the court views as a fair and reasonable amount that should be paid by the unsuccessful parties rather than any exact measure of the actual costs to the successful litigant.”

[3] From Boucher, Armstrong J.A. stated:

“Subrule (1) lists a broad range of factors that the court may consider in exercising its discretion to award costs under s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43. The express language of rule 57.01(3) makes it clear that the fixing of costs is not simply a mechanical exercise. In particular, the rule makes clear that the fixing of costs does not begin and end with a calculation of hours times rates…Overall, as this court has said, the objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding, rather than an amount fixed by the actual costs incurred by the successful litigant.”

[4] In that decision, the Ontario Court of Appeal added:

“In deciding what is fair and reasonable, as suggested above, the expectation of the parties concerning the quantum of a costs award is a relevant factor. See City of Toronto v. First Ontario Realty Corporation (2002), 59 O.R. (3d) 568 at 574 (S.C.J). I refrain from attempting to articulate a more detailed or formulaic approach. The notions of fairness and reasonableness are embedded in the common law. Judges have been applying these notions for centuries to the factual matrix of particular cases.”

[5] In Andersen v. St. Jude Medical Inc. (2006), 264 D.L.R. (4th) 557, the Divisional Court set out several principles that must be considered when awarding 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) of the Rules of Civil Procedure: Boucher, Moon v. Sher (2004), 246 D.L.R. (4th) 440 (Ont. C.A.), and Coldmatic Refrigeration of Canada Ltd. v. Leveltek Processing LLC (2005), 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) of the Rules of Civil Procedure.
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), 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.

[6] As outlined, the overriding principle is whether the costs award is fair and reasonable: Davies v. Clarington (Municipality) (2009), 2009 ONCA 722, 100 O.R. (3d) 66 (C.A.), at para. 52.

[7] In essence, there are limits at each step in the litigation based on the principles of predictability or the reasonable “expectations of the parties”. I make no specific finding with respect to the amount of time spent or the rates charged by Counsel for the Plaintiffs by counterclaim. As directed by the appellate Court, my costs award is what this Court views as a “fair and reasonable” amount that should be paid by the unsuccessful party rather than any exact measure of the actual costs of the successful litigants.

[8] I have considered the Costs Submissions filed by these parties, together with the Bill of Costs of the Defendants/Plaintiffs by counterclaim. In exercising my discretion from the Courts of Justice Act I have taken into account the factors enumerated under Rule 57 of the Rules of Civil Procedure, including the time spent, the experience of Counsel and the rates, the result achieved, the complexity of this matter and the conduct of the proceeding, as well as the application of the principle of proportionality. Considering all of these factors and principles, I have determined the fair, reasonable and proportionate amount.

[9] I conclude that the Plaintiffs by counterclaim are entitled to further costs for this trial, payable forthwith by the Defendant by counterclaim, and fixed in the additional amount of $45,000.00 all inclusive of fees, disbursements and HST.

The Honourable Mr. Justice David J. Nadeau Released: July 21, 2016