Court File and Parties

COURT FILE NO.: 91425/15 DATE: 2016 0816 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN: Dambensko Benevolent Society Applicant – and – Alessandro Mandarano Respondent

Counsel: S. Harris, for the Applicant Craig Losell, for the Respondent

READ: August 15, 2016 Woodley, j

DECISION REGARDING COSTS

Overview

[1] This application came before me for hearing on June 6, 2016. The Applicant sought an Order that a travelled path that exists between the Applicant’s property and the Respondent’s abutting property is not an access road pursuant to the Road Access Act. Alternatively, if the travelled path is an access road, the Applicant sought an Order the road be closed.

[2] For Reasons for Decision dated June 7, 2016, I determined as follows:

a. The travelled path is an access road pursuant to the Road Access Act, R.S.O. 1990, c. R.34, s. 1. b. Closure of the travelled path would prevent all road access to the Respondent’s property thereby necessitating a court order to close the travelled path in accordance with the Act. c. The court should exercise its discretion to close the travelled path in accordance with the Act at this time. However, reasonable and just conditions should be imposed on the closure to permit the Respondent to continue use of the travelled path pending: (i) the completion of construction of alternate access to the Respondent’s property; and/or (ii) November 30, 2016, whichever occurs first.

[3] The Reasons for Decision also provided that if the parties were unable to agree upon costs they were entitled to file submissions not to exceed three pages in length with Bills of Costs attached. Not surprisingly, the parties were not able to agree and have filed submissions regarding costs.

[4] The Applicant seeks costs on a substantial and/or complete indemnity basis fixed at $54,972.21. Alternatively, the Applicant seeks costs on a partial indemnity basis. The Applicant submits that it was successful in its application and obtained an Order closing the “travelled path” albeit subject to conditions. The Applicant claims to be “free of any blame” and submits that it has “acted reasonably bringing the necessary court application” rather than unilaterally closing the path. The Applicant claims that it would be inherently unfair not to award costs on a full indemnity basis given that much of the costs were incurred because of the “unreasonable position” taken by the Respondent which forced the Applicant to bring the court application. Finally the Applicant notes that the Respondent is making a claim against title insurance and has or “will be compensated for the cost he has incurred”. It is argued that any proceeds payable to the Respondent or loss of access by his title insurer should be used to pay the Applicant’s costs on a full indemnity basis pursuant to Gouett v. Mullins, 2016 ONSC 714.

[5] The Respondent submits that, at best, success was divided. The Respondent notes that there were three issues to be determined and the “main and unwavering thrust of the Application” was the Applicant’s position that the Respondent has no right to utilize the travelled path and is required to utilize alternate routes to access his property. The Applicant’s argued the travelled path was not an access road, there was alternative access and the Road Access Act did not apply. The Respondent submits that he was required to respond and resist given that if the application as drafted if successful would have immediately terminated any right of access to his property. As for the Applicant’s alternate request for relief, the Respondent notes that the Applicant did not propose any terms to the court for closure, just that it be closed. The Respondent submits that this is an exceptional case and although the Applicant was partially successful on one issue, each party ought to bear their own costs. Alternatively, if I determine that costs ought to be awarded, the Respondent submits they should be on a partial indemnity basis reduced to no greater than $20,000 inclusive of HST and disbursements. With respect to the issue of the title insurance claim, the Respondent submits that he has not received any money from the title company, has issued a claim but has no guarantee of recovery. The Respondent submits that there is no windfall or double recovery present and therefore the case is distinguishable from the Gouett decision.

The Law Relating to Costs

[6] The general principle is that a successful party is entitled to costs. It is accepted that this general principle should not be departed from unless there is good cause to do so.

Scale of Appropriate Costs

[7] It is within my discretion to award no costs, costs on a partial indemnity basis or a substantial indemnity basis, and to order that such costs be fixed or assessed.

[8] The Applicant seek costs on a substantial or full indemnity basis fixed at $54,972.21 and alternatively, on a partial indemnity basis.

[9] The Respondent submits that each party should bear their own costs and alternatively if costs are awarded they should be awarded on a partial indemnity basis fixed at no greater than $20,000.00 inclusive.

Basis for Scale of Costs

[10] The general default order for costs is on a partial indemnity basis. The Ontario Court of Appeal in Murano v. Bank of Montreal, 41 O.R. (3d) 222, determined that increased cost awards are available but only appropriate in special and rare cases, including cases of fraud or other allegations of improper conduct seriously prejudicial to the character or reputation of a party which is found to be totally unfounded.

[11] In Aba-Alkhail v. University of Ottawa, 2013 ONSC 6070, 14 C.C.E.L. (4th) 133, the court held that unfounded allegations of improper conduct are capable of attracting substantial indemnity costs when the allegations are seriously prejudicial to the character or reputation of the individual.

[12] In determining whether to award increased costs the court must consider all of the circumstances and, as noted by the Court of Appeal decision of Bellini Custom Cabinets v. Delight Textiles Limited, 2007 ONCA 413, 225 O.A.C. 375, where a plaintiff was not reckless or outrageous to raise the allegation the court may decline to award substantial costs.

[13] In the present case, I see no circumstance that would warrant costs to be awarded on a substantial indemnity basis. Further, I agree with the Respondent that success on the application was divided.

[14] The Applicant was only partially successful. The Applicant argued that the travelled path was not an access road and submitted that the Respondent had alternate means to access his property. I determined that the travelled path was an access road and the Respondent had no alternate means of access. This finding was in keeping with the submissions made by the Respondent.

[15] As for the Applicant’s alternate relief, that the travelled path, if found to be an access road, be ordered closed, such relief was granted as requested by the Applicant. However, the relief was granted on terms determined by the Court and not as requested by either party or as contained in any offer to settle.

[16] Usually, where results are divided, ordinarily no costs would follow. However, as noted by the Respondent, this is an exceptional case.

[17] Unless the Applicant was content to continue allowing abutting owners to use the access road, it was necessary to bring an application to have the road closed. Further, without determination of the issue, the Respondent abutting property owner was at the mercy of the Applicant as owner of the travelled path to continue to allow access to his property. Again, it was necessary to bring an application to have both the Applicant’s and the Respondent’s rights determined.

[18] The parties’ difficulties with the travelled path were not created by the Applicant or the Respondent but existed when each of the parties purchased their respective properties. It was time and circumstance that caused the litigation not the actions of either party. Simply stated, someone had to bring this application to the court for determination of the parties’ respective rights.

[19] While the results of the application were divided, the necessity of having the matter determined by the court was required by the Applicant and the Respondent equally.

Quantum of Costs

[20] The question now arises as to the appropriate quantum of costs to award, if costs are awarded.

[21] Pursuant to Rule 57 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, I am required to fix costs in all but exceptional cases. This is not an exceptional case with respect to determination of the costs and I will fix the costs.

[22] In exercising my discretion to determine the appropriate award of costs payable, I have specifically considered the issues of proportionality, complexity, and importance of the issues to the parties and have thoroughly reviewed and assessed each item listed on the Bills of Costs.

[23] Based upon my review and in accordance with the overreaching principles I have determined that the Applicant shall be entitled to the costs for preparation of the initial application to bring the matter to a hearing, costs for the adjournment requests of the Respondent, together with payment of one-half of the necessary disbursements.

[24] Having carefully reviewed the Bills of Costs and submissions, I hereby award costs to the Applicant fixed at $5,000.00 plus HST together with disbursements fixed at $2,148.92, inclusive.

Disposition

[25] Based on the foregoing, I hereby award costs to the Applicant payable by the Respondent fixed at $7,798.92, inclusive of HST and disbursements payable within 90 days of the date herein.

Madam Justice S. J. Woodley Date: August 16, 2016