Court File and Parties

Court File No.: CV-10-098760-SR Date: 2016-06-03 Superior Court of Justice - Ontario

Re: The Toronto-Dominion Bank, Plaintiff And: Arthur Scott L. Froom, Defendant

Before: The Hon. Madam Justice M.E. Vallee

Counsel: Philip C. Polster, for the Plaintiff The Defendant is Self-Represented

Heard: By written submissions

Costs Endorsement

[1] This is further to my endorsement dated March 29, 2016 in which the Bank was granted leave to amend the title of proceedings. Its motion for summary judgment was dismissed. Mr. Froom’s motion for leave to amend his statement of defence, to convert the action to the ordinary procedure and to lift the writ of seizure and sale was granted. Mr. Froom also requested other relief which was not granted. He was self-represented.

[2] My endorsement provided that if the parties could not agree on costs, they were to serve and file written submissions, the text of which was limited to a maximum of 3 pages, not including any bill of costs from the Bank. They were also permitted to serve and file responding submissions.

[3] Mr. Froom’s submissions include a list of costs and disbursements requested, together with argument and reference to cases. Mr. Froom also filed a 4 page “Costs Appendix” together with numerous pages of receipts as well as an account from Nicolas C. Canizares, a lawyer who appears to have provided advice to Mr. Froom but was not counsel of record. The Bank’s submissions include copies of various emails. Subsequently, the court received Mr. Froom’s responding submissions. They consisted of a 17 page affidavit sworn by Mr. Froom on April 25, 2016, a 22 page affidavit also sworn by Mr. Froom on April 25, 2016, a copy of an email from Mr. Froom to counsel for the Bank attaching other emails regarding offers to settle and an email to the court from Mr. Froom dated May 6, 2016, setting out his explanation for the offers. Three days later, Mr. Froom filed his time dockets from July 31, 2015 to September 21, 2015. The Bank did not file any responding submissions within the prescribed time period.

The Bank’s Position

[4] The Bank states that Mr. Froom made an offer to settle which the Bank accepted. The terms were that Mr. Froom would pay $50,000 within 90 days of September 2, 2015 or earlier if a property that Mr. Froom owned was sold. The Bank stipulated that payment was required by December 1, 2015. Mr. Froom did not make the payment. The Bank sent an email to Mr. Froom and Mr. Canizares dated December 2, 2015 noting that the funds had not been paid.

[5] The Bank provided two emails, one from Mr. Canizares dated September 2, 2015 which sets out the offer and another from the Bank dated September 10, 2015 which indicates acceptance of the offer. The Bank states that it had to proceed with the motion for summary judgment. The motion would not have been necessary had Mr. Froom honoured the terms of the settlement.

[6] The Bank also states that Mr. Froom’s materials were unnecessarily voluminous. He requests costs associated with 15,000 pages of documents and 300 hours of time spent on this matter which is grossly excessive, outlandish and unconscionable. There is no evidence that Mr. Froom lost any income as a result of his participation in these proceedings. Mr. Froom requests reimbursement for Mr. Canizares’ account; however, he was never counsel of record and his docketed time does not refer to this matter. There is no evidence that this account was paid.

[7] For these reasons, the Bank states that Mr. Froom should not be entitled to any costs on either motion. Alternatively, the Bank requests an order that costs be payable in the cause.

Mr. Froom’s Position

[8] Mr. Froom states that no offer to settle was accepted. He provided copies of several emails; however, the last one from the Bank is dated September 8, 2015 and states that it did not yet have instructions. I note that this is misleading because the Bank’s email dated September 10, 2015 shows that the offer to settle was accepted.

[9] Mr. Froom states that he is entitled to costs on an hourly rate and on a scale equal to opposing counsel with no reduction. Mr. Froom states that he spent 518 hours on his own motion and on defending the Bank’s motion. He submits that he is entitled to costs. For each aspect of this work, he sets out a “full indemnity” calculation based on $500 per hour. He also sets out another calculation for each aspect based on $330 per hour. Although he also describes this second calculation as “full indemnity”, I assume that this is an error on his part and that it is actually partial indemnity because the rate used is two-thirds of the $500 per hour rate. Mr. Froom claims full indemnity costs of $258,000 for his time spent on these motions. At a partial indemnity rate, he claims $186,890. He submits that a “global reduction to $200,000 all inclusive” would be fair and what the Bank would have expected to pay.

[10] Regarding disbursements, Mr. Froom claims the following:

a) 15,000 photocopies $4,800.00 b) Scanning 600 pages $ 192.00 c) Office supplies $1,206.75 d) Swearing of affidavits $ 281.60 e) Thompson Reuters/Carswell (a legal text on summary judgment) $ 140.75 f) Barrett Gunn Reporters $ 96.52 g) Process server “plaintiff’s counsel expedited” $ 95.00 h) Process servers to file documents in Newmarket $ 205.00 i) Nicolas Canizares, Barrister and Solicitor $4,068.00 j) Cynthia Martinez (“my employee”, internal cost to locate documents) $ 350.00 Total Disbursements $11,435.62

Analysis

[11] The Bank states that this motion would have been unnecessary had Mr. Froom complied with the terms of the offer to settle. Accordingly, no costs should be allowed. I disagree. If the Bank had brought a motion for judgment on the amount of the accepted offer, the Bank’s position might have some merit; however, this was a motion for summary judgment on the full amount of the claim together with interest.

[12] The bank obtained a procedural order but was unsuccessful on its motion for summary judgment. Mr. Froom was successful in part on his motion. He had a greater degree of success in contrast to the Bank.

Disbursements

[13] With respect to the disbursements claimed, I note the following:

(a) Mr. Froom filed voluminous materials on the motions, just as he did in his costs submissions. He states that he made 15,000 photocopies. Assuming that he made 3 copies of each document, one for himself, one for opposing counsel and one for the court, this would amount to 5,000 pages each. Given their volume, one set of Mr. Froom’s materials for both motions could have included 5,000 pages. Many of the documents were irrelevant and repetitive. Multiple copies were filed. The volume of Mr. Froom’s documents was beyond excessive. I conclude that a reasonable amount for photocopying documents required for these motions is $250. (b) Mr. Froom claims $192 for scanning 600 pages. Again, this number of pages is excessive. There is no legible receipt for scanning. The amount is not allowed. (c) Regarding the claim of $1,206.75 for office supplies, Mr. Froom provided copies of a number of receipts, many of which were too dark or crumpled to read. A number of the receipts did not specify the item purchased. Some receipts can be identified for binding materials, printer ink, a stapler and a numbering machine. These total $205.65 US. Mr. Froom also provided receipts for postage, UPS delivery. They totalled approximately $256 US. A portion of these supplies and postage would not have been necessary had Mr. Froom filed a reasonable volume of materials. I allow $300 for these items. (d) Mr. Froom claims $281.60 to have 11 affidavits of service sworn. Eleven affidavits were not required for these proceedings. Four would have been sufficient. I allow $100 for this item. (e) Mr. Froom claims $140.75 for a text book that he purchased regarding the Rules of Civil Procedure. This is not a proper disbursement. (f) Mr. Froom cross-examined, by telephone, a plaintiff’s deponent on his affidavit. The deponent attended at Barrett Gunn Court Reporters. Mr. Froom provided a receipt from Barrett Gunn for $96.92. This amount is allowed. (g) and (h) Mr. Froom claims $95 and $205 for process servers. There are no receipts for these amounts. Nevertheless, Mr. Froom would have incurred some charges for process serving and court filing because he lives in the U.S. I allow $200 for this item. (i) Mr. Froom claims $4,068 for Mr. Nicolas Canizares’ account, a copy of which is provided. The account simply states, “Re: Litigation”. There is no indication of any specific matter. Mr. Canizares was not counsel of record. This amount is not allowed. (j) Mr. Froom claims $350 for the services of Cynthia Martinez. She is described as his employee whose task was to “find TD Visa checks, quickbooks/excel email.” There is no receipt or other evidence to show that Mr. Froom paid Ms. Martinez this amount. It is not allowed.

[13] The sum of $946.92 is allowed for disbursements.

Reasonable Allowance

[14] Mr. Froom states that he is entitled to costs on an hourly rate and on a scale equal to opposing counsel with no reduction. I disagree.

[15] A self-represented party does not incur legal fees. If a self-represented party is employed and earning an income, he may incur a loss of opportunity cost if he spends time conducting the litigation that would otherwise have been spent earning an income. There must be some evidence of the income and the fact that it has decreased as a result of the litigation. It does not need to be detailed. Even if the evidence is thin, it may be sufficient to prove a loss of opportunity cost. If the loss is proved, a self-represented party is entitled to a reasonable allowance for the loss of his time to conduct the litigation. (see Miller v. De-Bartolo-Taylor et al, 2013 ONSC 6791)

[16] As noted above, Mr. Froom filed responding submissions comprised of two affidavits that were 39 pages combined together with other documents. These submissions ought to have been 3 pages as per my endorsement. I will consider the first 3 pages of Mr. Froom’s document entitled “Submission/statement and affidavit of Arthur Froom made in response to plaintiff’s cost submission and in support of costs on scale equal to opposing counsel expanded lost income and lost opportunity briefed and detailed responses to issues raised by plaintiff’s cost submissions sworn April 25, 2016 (Part 1)”.

[17] Mr. Froom states that he is a successful business man and entrepreneur and has been for over 35 years. He is “an expert in economics and financial matters (prior licensure by SEC and NASD as fiduciary party), in law and in marketing and distribution.” He states that he owned certain businesses, traded shares, bought and sold real estate and was paid between $500 and $1,000 per hour for his “business acumen and advice.” He is a stockholder/owner of Lafontaine Source e De Jeunesse Corporation as well as two companies. He states that Lafontaine “is a College of Physicians and Surgeons level 3 outpatient hospital.”

[18] A document from an FBI website, which was an exhibit to the Bank’s affidavit on the motion, states that Mr. Froom pleaded guilty to fraud involving more than $900,000. Mr. Froom has not denied that he was incarcerated. In his submissions received on April 19, 2016, he states that his period of home confinement following release from prison ended on July 2, 2015. He was not prevented from working and “did work and manage his assets.” Exactly what work he did and which assets he managed are not set out at all. There is no evidence that he has spent time conducting the litigation that would otherwise have been spent earning an income. There is no evidence that he earned any income. No tax returns have been provided.

[19] On page 3 of Mr. Froom’s submissions filed on May 6, 2016, he states that he was involved in a case, Metropolitan Toronto Condominium Corporation No. 562 ONCA in which he was awarded his “full attorney’s fees” of $8,500 all inclusive. He states that the court did not inquire as to whether he was working or whether he had lost any opportunity to do so as a result of his participation in the litigation.

[20] In Metropolitan Toronto, the court did award Mr. Froom $8,500 all-inclusive for costs; however, that amount was for both the costs of the application and the appeal. There are no reasons given for the costs award nor is there a breakdown regarding how they were calculated. Some of this amount would have included disbursements and tax. Accordingly, Metropolitan Toronto does not assist me with this matter.

[21] As I noted earlier, Mr. Froom requests costs of $200,000 all-inclusive to defend the Bank’s motion for summary judgment and to bring his own cross-motion. These motions were not argued. Rather, they proceeded in writing. The amount requested has no basis in reality. It is absurd. If Mr. Froom had counsel on this matter, the lawyer’s account would have been nowhere near that amount. I note that the plaintiff did not submit a costs outline showing what they would have expected to receive in costs had they been successful. Aside from Mr. Froom’s self-serving statements, there is no other evidence of any lost income or anything else that shows a loss of opportunity cost. Nevertheless, a litigant should not be completely insulated from costs just because the successful party is self-represented.

[22] Ultimately, awarding costs is within the discretion of the court, subject to the Rules of Civil Procedure, Rule 57.01(1). I have considered the factors listed in Rule 57.01(1) and the principles of reasonableness and proportionality expressed in Boucher v. Public Accountants, 71 O.R. (3d) 291.

[23] For the reasons stated above, I conclude that Mr. Froom is entitled to an allowance of $500. Accordingly, the Bank shall pay Mr. Froom $1,446.92 for his costs in this matter.

VALLEE J. Date: June 3, 2016