Court File and Parties

Court File No.: C-456-10 Date: 2016-07-26 Ontario Superior Court of Justice

Between: Richard Lavoie and Michel Lavoie, Plaintiffs – and – Richard Trudel and Paulette Trudel in their personal capacity and in their capacity as Estate Trustees of Lucien Trudel, Deceased, Defendants

Counsel: Plaintiffs, Acting in Person Mathieu R. Ansell, Counsel for the Defendants

Heard: Written Submissions

Justice E. Gareau

Reasons on Costs

[1] On June 27, 2016, I released a decision with respect to this matter which proceeded to trial before me for seven days in May and June 2016.

[2] Subsequent to the release of my reasons, I have received and reviewed written submissions from counsel for the defendants and from both plaintiffs personally.

[3] This matter arose in respect to the validity of the last will and testament executed on December 5, 2007. The plaintiffs claim that this will was invalid due to the lack of testamentary capacity of Lucien Trudel and undue influence was dismissed by the court.

[4] Both the plaintiffs and the defendants claim their costs in this matter. Although the plaintiffs were unrepresented during the trial, at times prior to trial they were represented by counsel; firstly by Richard Pharand, Q.C. and then by the firm of Wagner, Sidlofsky in Toronto, Ontario. The plaintiffs seek in costs the sums paid to these firms in representing them in this matter.

[5] The defendants seek costs as the successful party in this litigation and have submitted a bill of costs in which they set out their costs as follows:

Full Indemnity $47,810.09 Substantial Indemnity $38,804.39 Partial Indemnity $29,798.68

[6] As set out in the last paragraph of the last full page of their written submissions on costs, the defendants are asking the court to set costs at $35,173.22 inclusive of disbursements and HST, payable by the plaintiffs.

[7] As set out in section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43, costs are in the discretion of the court subject to any provisions in the rules that may assist the court in the exercise of its discretion.

[8] In the exercise of its discretion under section 131 of the Courts of Justice Act, to award costs the court may consider any offer to settle made in writing and the factors set out in Rule 57.01(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.

[9] In deciding the issues of costs, it is important for the court to consider written offers made by the parties prior to the trial of this action. A formal offer was repeated in correspondence dated May 12, 2016 from the solicitor for the defendants to the plaintiffs. Under the heading “Rule 49 Offer to Settle”, the letter reads as follows:

Please note that the defendant has offered to settle this action, in the all-inclusive amount of $20,000 in exchange for a dismissal of this action, which offer remains available for acceptance in writing until one minute after the start of this trial, unless withdrawn in writing before then. This offer to settle is made pursuant to Rule 49 of the Rules of Civil Procedure. See attached offer to settle.

[10] This offer was not accepted by the plaintiffs. The defendants take the position that this was a “reasonable offer to settle” under Rule 49 and that the jurisprudence indicates that the costs consequence in the offer to settle rules must be followed unless there are special circumstances. The defendants submit that there are no special circumstances in the case at bar which would warrant the defendants not receiving their costs.

[11] Rule 49.10 of the Rules of Civil Procedure sets out the costs consequences for the failure to accept an offer to settle made by a defendant as follows in Rule 49.10(2):

Where an offer to settle, (a) is made by a defendant at least seven days before the commencement of the hearing; (b) is not withdrawn and does not expire before the commencement of the hearing; and (c) is not accepted by the plaintiff, and the plaintiff obtains a judgment as favourable or less favourable than the terms of the offer to settle, the plaintiff is entitled to partial indemnity costs to the date the offer was served and the defendant is entitled to partial indemnity costs from that date, unless the court orders otherwise . [Emphasis added.]

[12] It is important to note that even in considering the effect of offers to settle made by the parties, the court retains the ultimate discretion as to whether an order for costs are appropriate in the circumstances of the case before it.

[13] As far as the offer of $20,000 all-inclusive made by the defendants to the plaintiffs, that offer may have been reasonable in hindsight, but at the time it was made the plaintiffs may have had good reason to want the issues before the court adjudicated. In that I refer to the court’s comments in paragraphs 88, 89 and 90 of its reasons for judgment. The more equitable offer given the familial relationship of the parties may have been to share the estate of Lucien Trudel equally among all his living biological children and stepchildren.

[14] Both the plaintiffs and the defendants have incurred direct costs to have this matter adjudicated. The defendants claim costs in the amounts set out in paragraph five of these reasons. The plaintiffs submitted set out in the “Bill of Costs of the Plaintiff – Lawyers’ Fees”. This brief sets out the amounts paid by the plaintiffs to their previous solicitors, Richard Pharand, Q.C. and the firm of Wagner, Sidlofsky. By my calculation, the sum of $46,493.54 was paid out to these firms by the plaintiffs for fees, disbursements and HST. This is a substantial amount of money in that it did not include fees for trial preparation or attendance at the trial.

[15] Considerable expense has been incurred by all the parties with respect to this matter. The nature of the result of the trial created, in my view, an inherent injustice that the law did not allow the court to remedy. This fact is directly commented upon in the latter paragraphs of my written reasons released on June 27, 2016.

[16] In my view, there are exceptional circumstances in the case at bar where the court should exercise its discretion not to penalize the plaintiffs by an order of costs despite the offer to settle made by the defendants. To order costs in the case at bar would, in my view, create an injustice given the nature of the case and the ultimate order made at trial.

[17] My view is that the fair and appropriate disposition is that each party shall bear their own costs of this litigation. The plaintiffs paid substantial fees to their counsel, which they should be responsible for and the defendants have paid substantial fees to their counsel, which they should be responsible for.

[18] In my view, the offer to settle made by the defendants was not a reasonable offer that would attract the acceptance of the plaintiffs and the plaintiffs (despite the end result of the litigation) were not unreasonable in insisting on a trial given all the factors in this case.

[19] Considering the factors set out in Rule 57.01(1) of the Rules of Civil Procedure and the equitable exercise of my discretion, there will be no order for costs and the parties will be responsible for their own costs.

Justice E. Gareau Released: July 26, 2016