Court File and Parties
Court File No.: CV-14-508942 Dates Heard: March 29 and March 30, 2016
Superior Court of Justice - Ontario
Re: Andrianie Karistinos v. Evaggelos Karistinos
Before: Master R. A. Muir
Counsel: Evan L. Tingley, for the applicant Jack Copelovici, for the respondent
Supplementary Reasons for Decision - Costs
1These supplementary reasons for decision are delivered in connection with an application heard January 30, 2015 and a reference hearing held before me over a period of two days on March 29 and March 30, 2016.
2This proceeding involves the partition and sale of a jointly owned residential condominium property and a resulting accounting dispute. The applicant and respondent are mother and son.
3On January 30, 2015, the Honourable Justice Faieta granted judgment directing a sale of the property and a reference to a master at Toronto for the taking of accounts. Justice Faieta’s judgment also directed the reference master to determine the issue of the costs of the application.
4I released my reasons for decision on June 8, 2016. I determined that the applicant was entitled to $72,002.46 from the net proceeds of sale and the respondent was entitled to $205,585.50. I also requested written costs submissions. I have now received and considered those submissions.
5Both sides seek their costs of the application and the reference hearing. The applicant requests partial indemnity costs of the application in the amount of $11,834.80 along with $14,772.03 for the reference. The total is $26,606.83.
6The respondent submits that the court should award him substantial indemnity costs for a portion of the reference pursuant to an offer to settle dated February 10, 2016. The respondent has quantified his costs of the application and the reference hearing as being $13,865.10 prior to the offer to settle (partial indemnity) and $19,459.50 after the offer to settle (substantial indemnity). The total is $33,324.60.
7The court’s general authority to award costs as between parties to litigation is found in section 131(1) of the Courts of Justice Act, RSO 1990, c C.43, which provides that costs are in the discretion of the court. Rule 57.01(1) of the Rules of Civil Procedure, RRO 1990, Reg. 194 (the “Rules”) allows the court to consider the result achieved in the proceeding and any offer to settle. This Rule includes a non-exhaustive list of factors the court may also consider when awarding costs. Rule 1.04(1.1) is also applicable. It requires the court in applying the Rules to make orders that are proportionate to the importance and complexity of the issues and to the amount involved in the proceeding.
8When dealing with costs, the overall objective for the court is to fix an amount that is fair and reasonable for the unsuccessful party who generally must pay the costs of the successful party. See Zesta Engineering Ltd. v. Cloutier, [2002] OJ No. 4495 (CA) at paragraph 4 and Boucher v. Public Accountants Council for the Province of Ontario, [2004] OJ No. 2634 (CA) at paragraph 26. In Davies v. Clarington (Municipality), 2009 ONCA 722 the Court of Appeal stated as follows at paragraph 52:
Rather than engage in a purely mathematical exercise, the judge awarding costs should reflect on what the court views as a reasonable amount that should be paid by the unsuccessful party rather than any exact measure of the actual costs of the successful litigant.
9These are the factors and principles I have considered and applied in determining the costs of the application and the reference hearing. In my view, it is fair and reasonable that each side bear their own costs of this proceeding.
10In my view, the applicant was the successful party on the application before Justice Faieta. The respondent resisted the proposed sale of the property up until the eve of the hearing of the application. The applicant was forced to prepare the application materials, which included affidavit evidence and a factum. Cross-examinations were also conducted in advance of the application. Most of this could have been avoided had the respondent agreed to a sale of this jointly owned property from the outset. The applicant is entitled to her costs of the application.
11I do agree with the respondent that the applicant’s fees in relation the application appear somewhat excessive for an application of this nature. However, I have carefully reviewed the respondent’s dockets. It appears that the applicant’s fees are only a few thousand dollars more than the respondent’s fees and the applicant did have the burden of initiating the proceeding. I also note that the applicant’s fees in connection with the reference hearing appear to be somewhat less than the respondent’s fees. The overall partial indemnity fees for the application and the reference hearing are similar for both sides.
12In terms of the reference hearing, it is my view that the respondent was the successful party. I determined that the respondent was entitled to 74% of the net proceeds of sale. The amount recovered by the applicant was less than the amounts the respondent offered to pay the applicant before this proceeding was started and in the offer to settle dated February 10, 2016. The reference hearing could have been avoided had the applicant accepted those offers. This is an appropriate consideration when awarding costs as set out in Rule 49.13.
13The respondent is therefore entitled to his costs of the reference hearing. However, I see no basis for awarding substantial indemnity costs. The respondent’s offers to settle expired before the commencement of the hearing and therefore do not comply with Rule 49.10. There is no evidence of conduct on the part of the applicant that would otherwise justify an elevated costs award.
14I do not view the other factors relied on by the parties as significant in the context of this proceeding. There were a few admissions the applicant could have made that would have shortened the trial to a limited extent but those issues occupied very little court time. There is no evidence that the short extension of the lease had any impact on the ultimate selling price. The respondent’s cross-examination of the applicant cannot be described as unreasonable in the circumstances. Finally, I do not view Justice Faieta’s endorsement as limiting in any way my discretion to fix the costs of the application. There is nothing in the language of his judgment qualifying the referral of the costs of the application to the master conducting the reference.
15The applicant’s partial indemnity costs of the application are very close in quantum to the respondent’s costs of the reference hearing. The differences are simply not significant in the overall context of this proceeding. Each side shall bear their own costs. It is therefore fair and reasonable that there be no order for the costs of the application or the costs of the reference hearing.
16The applicant shall prepare a formal report in accordance with these reasons and my reasons for decision dated June 8, 2016. The report shall be submitted to me for signing once approved as to form and content.
Master R.A. Muir
DATE: August 2, 2016