Superior Court of Justice - Ontario

Citation: Adams v. Adams, 2016 ONSC 4288 Court File No.: CV-15-522655 Date: 2016-06-28

Re: Nisha Adams, Plaintiff And: Caleb Adams, Susan Carol Needles, Ira George Needles, Clayton Edward Adams, Toronto Police Services Board, William Blair, Cheryl Jones, Alexandra Read, Gerald Heaney, Tommy Cornett and David Partridge, Defendants

Before: S. F. Dunphy, J.

Counsel: Gordon McGuire, for the Plaintiff Colin Pendrith, for the Defendants/Appellants Susan Carol Needles and Ira George Needles

Heard: In writing

Costs Endorsement

[1] I have now had the opportunity to consider carefully the costs submissions of both the successful appellants and the unsuccessful respondent on this appeal from a Master’s order. My decision in this matter and the necessary background facts can be found at Adams v Adams, 2016 ONSC 3357. Unfortunately, both parties have failed to approach the exercise of fixing costs with the requisite degree of reasonableness. They are far apart both as to scale and as to amount.

[2] I turn first to the matter of scale.

[3] The successful appellants seek substantial indemnity costs. They base this request on (i) the fact that the appeal originated from an ex parte order obtained without full disclosure; and (ii) two settlement offers that, although not strictly conforming with Rule 49.10 of the Rules of Civil Procedure, were nonetheless advantageous.

[4] In my view, the loss of the benefit of the certificate of pending litigation is adequate sanction for the non-disclosure that occurred in this case. I decline to order substantial indemnity costs by reason of the lack of disclosure.

[5] The two settlement offers are factors that I may properly take into account, but they only move the needle a little ways. The first settlement offer was made informally in August 2015 prior to the hearing of the motion to vacate the ex parte CPL before the Master. The offer was to pay $25,000 of sales proceeds into escrow. That amount is certainly greater than the amount the plaintiff now has to look to by reason of the successful appeal in this case, but I cannot find that it was an offer of a compromise significant enough to warrant an award of substantial indemnity costs on the facts of this case.

[6] Despite the first offer being a “bottom line” offer, the appellants made a second offer less than a week prior to the hearing that was considerably more substantial. Pursuant to this second offer, both parties would bear their own costs and up to $196,350 of sales proceeds would be paid into court. I find that this second offer, although made too late to attract the application of Rule 49.10 of the Rules of Civil Procedure, is nevertheless an offer that was a valid, bona fide effort at compromise and one that, had it been accepted, would have saved considerable expense to both sides. In my view, the appellants are entitled to recognition for having made such an offer in the level of costs awarded after the date of the offer.

[7] I find the plaintiffs are entitled to partial indemnity costs for the appeal before me and for the motion before the Master. The plaintiffs shall also be entitled to a “premium” to partial indemnity costs in respect of the preparation and hearing time following the delivery of the offer on May 3, 2016. I shall discuss the amount of that premium below.

[8] The parties were also quite far apart on quantum.

[9] The plaintiff submits that costs on the hearing before Master Pope ought to be awarded to the appellants in the same amount as Master Pope had awarded to her ($7,500). Her reasoning is that the Master heard submissions from both sides on the matter of costs of that hearing and has already fixed a reasonable number. It does not follow that costs awarded to one party must necessarily be the same as the costs that would have been awarded to the other. Lacking the outline of costs from the plaintiff that was before the Master, I have little ability to do more than a crude comparison. In my view, the costs awarded by Master Pope in the order appealed from are to be referenced as a guideline entitled to some weight. The shall use it as a proxy to assess the reasonable expectations of the respondent on appeal given the failure of the plaintiff to provide me with more fulsome information herself.

[10] The plaintiff also submits that I ought to take into account what she considers to be the unfairness of my giving the appellants an award of costs payable immediately while the various awards of costs made in her favour in family court against her husband remain unpaid. The evidence of the plaintiff on this motion strongly suggested that her husband is of extremely limited means, means that are already being garnished to ensure payment of child support. Whether he has additional means to pay some or all of the almost $40,000 in costs awards the plaintiff has obtained against him without thereby being reduced to abject penury, I cannot say. However, there can be no basis for me to make the moving party appellants indirectly liable for their son’s obligations. There is of course nothing stopping the parties from coming to an agreement off-setting one costs award against the other, in whole or in part, on their own. That is nothing I can require in this case.

[11] The factors I must examine under Rule 57.01 of the Rules of Civil Procedure are well known and need not be repeated in each and every costs endorsement. I have highlighted here the principal arguments raised by each of the parties. I take these and apply them through the filter of the various criteria in Rule 57.01 seeking to determine a reasonable outcome that balances each.

[12] The appellants provided me with their costs outline before Master Pope. This outlined fees and disbursements of $24,773.84 on a partial indemnity basis. Such amount is obviously significantly higher than the $7,500 awarded by Master Pope to the plaintiffs on the motion. I am prepared to grant deference to Master Pope’s determination and assume that $7,500 represented an appropriate balance between the principle of indemnity and the reasonable expectations of the losing party. However, I lack the initial input being the actual costs of the plaintiffs to which the principle of indemnity was applied. The successful appellants clearly incurred very significant costs in bringing the appeal before Master Pope and did so for understandable reasons. The motion was very important to them. I would award the appellants $15,000 for their costs below. This is a figure that balances the principle of indemnity against the reasonable expectations of the losing party. The plaintiff having given me no information to work from, I am prepared to use Master Pope’s award as a proxy for that determination.

[13] On the appeal before me, the plaintiff suggests that I ought to award the appellants $6,000 all-inclusive on a partial indemnity basis. The appellants outline of costs details $11,178.00 on a substantial indemnity basis and $7,452 on a partial indemnity basis. It does not enable me to break down costs incurred after the date of the offer to settle. Disbursements are listed as amounting to $490.22.

[14] In my view, the appellants should be entitled to a premium of 50% of the difference between the substantial indemnity and partial indemnity costs outline they have provided to account for their settlement offer. That premium amount is $1,863 on top of the $7,452 of partial indemnity costs claimed plus $490.22 for a total (on the appeal alone) of $9,805.22.

[15] I am therefore awarding the appellants costs of the appeal before me and their motion below in the total amount of $24,805.22.

[16] Order accordingly.

S.F. Dunphy, J.

Date: June 28, 2016