Mancini Associates LLP v. Perpetual Income Producing Enterprises Inc. et al.
[Indexed as: Mancini Associates LLP v. Perpetual Income Producing Enterprises Inc.]
Ontario Reports Ontario Superior Court of Justice, Diamond J. May 3, 2016 131 O.R. (3d) 717 | 2016 ONSC 2959
Case Summary
Civil procedure — Costs — Offer to settle — Plaintiff obtaining judgment for $29,413.15 plus prejudgment interest — Defendant having failed to accept offer to settle for $29,413.15 inclusive — Plaintiff entitled to its costs on partial indemnity basis up to date of offer to settle and on substantial indemnity basis thereafter — Plaintiff awarded costs in amount of $40,000 inclusive.
The plaintiff obtained judgment against the defendant in the amount of $29,413.15 plus prejudgment interest. It sought costs in the amount of $64,537.28, inclusive of disbursements and HST.
Held, the plaintiff should be awarded costs in the amount of $40,000 inclusive.
The plaintiff served an offer to settle on the defendant for the all-inclusive sum of $29,413.15, and the defendant failed to accept that offer. The plaintiff was entitled to its costs on a partial indemnity basis up to the date of the offer to settle and on a substantial indemnity basis thereafter. In the circumstances of this case, $40,000 was a fair and reasonable quantum of costs.
Cases Referred To
- Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291, [2004] O.J. No. 2634, 188 O.A.C. 201, 48 C.P.C. (5th) 56, 132 A.C.W.S. (3d) 15 (C.A.)
- Doran v. Melhado, [2016] O.J. No. 1517, 2016 ONSC 2010, 35 C.B.R. (6th) 26, 265 A.C.W.S. (3d) 41 (S.C.J.)
- Mancini Associates LLP v. Perpetual Income Producing Enterprises Inc., [2016] O.J. No. 1832, 2016 ONSC 1823 (S.C.J.)
Statutes Referred To
Rules and Regulations Referred To
Ruling on Costs
Sezar J. Bune, for plaintiff. Anthony Guido, self-represented and acting in person. No one appearing for defendants Perpetual Income Producing Enterprises Inc. and Armando Orefice.
[1] Costs endorsement of DIAMOND J.: — On April 11, 2016, I released my reasons for decision [2016] O.J. No. 1832, 2016 ONSC 1823 (S.C.J.) which granted the plaintiff judgment against the defendant Anthony Guido ("Guido") in the amount of [page718] $29,413.15 plus prejudgment interest from December 24, 2010 (30 days after the plaintiff's first unpaid was due) at the rate prescribed by s. 128 of the Courts of Justice Act, R.S.O. 1990, c. C.43. At the conclusion of those reasons, I invited the parties to serve and file written costs submissions pursuant to a fixed schedule.
[2] I have now received and reviewed the costs submissions of both parties. To begin, there is no reason to depart from the general rule that costs follow the event, and thus as the successful party the plaintiff is entitled to its costs of this action from Guido. The outstanding issues to be resolved are (a) scale of costs and (b) quantum.
[3] As always, I am mindful that the court is required to consider what is "fair and reasonable" in fixing costs with a view to balancing compensation of a successful party with a goal of fostering access of justice: Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291, [2004] O.J. No. 2634 (C.A.).
[4] This action sought damages in an amount less than $100,000, and as such was (or ought to have been) governed by the simplified procedure under rule 76.02(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. While Guido initially brought a counterclaim which may have resulted in this matter being transferred into the ordinary procedure under rule 76.02(5), that counterclaim was dismissed on consent of the parties by order dated August 17, 2012 of Justice Perell.
[5] The plaintiff seeks its costs of the action in the total amount of $64.537.28 (inclusive of disbursements and HST). While I will have more to say about the breakdown of this sum hereinafter, the costs sought by the plaintiff are more than double the amount recovered at trial. Indeed, Guido questions how such an amount can be "fair and reasonable".
[6] I rely upon the comments of Justice Emery recently made in Doran v. Melhado, [2016] O.J. No. 1517, 2016 ONSC 2010 (S.C.J.) [at para. 55]:
It has also been held that proportionality should not automatically serve to reduce the costs to which a plaintiff is entitled simply because of the amount claimed is excessive in relation to the damages awarded. In this regard, I refer to Justice Daley in A & A Steelseal Waterproofing Inc. v. Kalovski, 2010 ONSC 2652 at para. 21:
Further, while costs awarded must be reasonable, it is not the case that the mere fact that costs exceed the damages awarded renders such an award inappropriate: Bonaiuto v. Pilot Insurance Co., 2010 Carswell Ont 1039. As has been stated, the fact that costs significantly exceed the amount at stake, at least in the main action, is regrettable but it is well known to counsel that this is one of the risks involved in pursuing [page719] or defending a case. As was noted by Lane J. in 163972 Canada Inc. v. Isacco, [1997] O.J. No. 838: " to reduce the plaintiff's otherwise reasonable costs on this basis would simply encourage the kind of intransigence displayed by the defendants in this case ." These words are most apt in the circumstance of this case.
[Emphasis in original]
[7] The plaintiff submits that on September 23, 2014, it served an offer to settle upon Guido for the all-inclusive sum of $29.413.15, and as Guido failed to accept the offer to settle (which was open for acceptance until one minute after the commencement of trial), the provisions of rule 49.10 apply and the plaintiff should be entitled to its costs on a substantial indemnity basis from September 23, 2014 onward.
[8] Guido did not specifically address the plaintiff's request that the court apply rule 49.10 other than to state that he "never received any offer from the plaintiff". I have been provided with the affidavit of service of Corrine Cohen which confirms service of the offer to settle upon Guido and attaches the facsimile transmission report.
[9] Dealing first with CIBC's request for costs on substantial indemnity basis, under rule 49.10 of the Rules of Civil Procedure, CIBC has the onus of proving that it obtained a result more favourable than the terms of its offers to settle.
[10] I find that the plaintiff has complied with the provisions of rule 49.10, and as a result it is entitled to its costs on a substantial indemnity basis from September 23, 2014 onward, and its costs on a partial indemnity basis up to the date of its offer to settle.
[11] The fixing of costs is a discretionary exercise under s. 131 of the Courts of Justice Act. That discretion is generally to be exercised in accordance with the factors listed in rule 57.01 of the Rules of Civil Procedure:
57.01 . . . (0.a) the principle of indemnity, including, where applicable, the experience of the lawyer for the party entitled to the costs as well as the rates charged and the hours spent by that lawyer; (0.b) the amount of costs that an unsuccessful party could reasonably expect to pay in relation to the step in the proceeding for which costs are being fixed; (a) the amount claimed and the amount recovered in the proceeding; (b) the apportionment of liability; (c) the complexity of the proceeding; (d) the importance of the issues; [page720] (e) the conduct of any party that tended to shorten or to lengthen unnecessarily the duration of the proceeding; (f) whether any step in the proceeding was, (i) improper, vexatious or unnecessary, or (ii) taken through negligence, mistake or excessive caution; (g) a party's denial of or refusal to admit anything that should have been admitted; (h) whether it is appropriate to award any costs or more than one set of costs where a party, (i) commenced separate proceedings for claims that should have been made in one proceeding, or (ii) in defending a proceeding separated unnecessarily from another party in the same interest or defended by a different lawyer; and (i) any other matter relevant to the question of costs.
[12] In terms of the quantum of costs sought by the plaintiff, I have reviewed the plaintiff's bill of costs in detail and agree, in part, with Guido's submission that some of the hours claimed by the plaintiff seem excessive, including spending 85.6 hours preparing for a trial that lasted two days. The plaintiff did not retain outside counsel and represented itself in this action.
[13] There are also several entries in the bill of costs that relate to time spent for matters which would not be recoverable against Guido (i.e., a motion for substituted service against the other defendants, a motion for default judgment against the other defendants, obtaining a write of seizure and sale against the other defendants, etc.).
[14] In the circumstances of this case, I believe that a fair and reasonable result would be awarding the plaintiff its costs of the action payable by Guido in the all-inclusive amount of $40,000.
Order accordingly.
End of Document