Court File and Parties
Court File No.: CV-12-462856 Motion Heard: 2016-05-18 Superior Court of Justice - Ontario
Re: BURNCO MANUFACTURING INC., Plaintiff And ELLISDON CORPORATION, Defendant
Before: Master Lou Ann M. Pope
Counsel: Counsel for plaintiff: Raymond M. Slattery, Minden Gross LLP Fax: 416-864-9223 Counsel for defendant: Angelo D’Ascanio, Advocates LLP Fax: 519-858-0687 Counsel for E.S. Fox Limited: Sean Clarke, Eccleston LLP Fax: 416-504-2686
Endorsement on Costs
[1] The plaintiff was successful on its motion to have this action and the companion action in E.S. Fox Limited v. Burnco Manufacturing Inc. (CV-12-458027) tried together. My Reasons For Endorsement on that motion is dated September 19, 2016.
[2] Both EllisDon and Fox cross-examined Burnco’s affiant on his affidavit. Numerous undertakings were given and answered. Pursuant to rule 39.02(4)(b), EllisDon and Fox are liable for Burnco’s partial indemnity costs of the cross-examination, unless the court orders otherwise. Neither EllisDon nor Fox deny that Burnco is entitled to these costs. In my view, Burnco’s costs of the cross-examination ought to include the costs of satisfying the undertakings.
[3] Burnco seeks its total partial indemnity costs of $37,248.71. Its costs based on actual rates are $60,819.94. Mr. Slattery has been a member of the bar for some 35 years. His actual hourly rate claimed is $690 and his partial indemnity hourly rate, being 60 percent of the actual rate, is $414. Burnco claims that its counsel spent 82 hours on this motion.
[4] EllisDon submits that Burnco should not be entitled to any costs. In the alternative, it proposes that Burnco have its costs if successful in the action, or if awarded costs, no more than $10,000 plus HST. It further submits that the amount sought by Burnco is excessive and unreasonable in the circumstances. EllisDon states that Burnco’s costs ought to be reduced considering five factors set out in EllisDon’s costs submissions. Based on EllisDon’s Costs Outline, it claims to have incurred $14,855.25 in fees, HST and disbursements. Mr. D’Ascanio has been a member of the bar for some 25 years. His actual hourly rate is $425 and his partial indemnity hourly rate, being 60 percent of the actual rate, is $255.
[5] Fox’s submissions are similar to EllisDon’s submissions. In particular, Fox submits that it was important to oppose the motion given that the trial of its action was scheduled to proceed this month and if Burnco were successful, the trial would be delayed, which was the outcome. Fox blames Burnco for delaying its action by bringing this motion late. Based on the Costs Outline, Fox claims to have incurred $7,521.78 in fees, plus HST and disbursements. Mr. Clarke has been a member of the bar for seven years. The Costs Outline does not state his actual hourly rate, as required; however, his substantial indemnity hourly rate is $400 and his partial indemnity hourly rate is 66 percent of the actual rate, or $264.
[6] It is my view that this motion was not complex and the case law on this issue has been settled for many years. However, although not complex, there were numerous factors as set out in the jurisprudence that had to be addressed.
[7] In determining the costs to be awarded, the court applies the overriding principles of fairness and reasonableness in taking a contextual approach. Further, the court is required to consider the principle of proportionality pursuant to rule 1.04(1.1), being the amount of costs ordered should be proportional to the amount of money and other interests sought in the proceeding. As enunciated by the court in Boucher et al v. Public Accountants Council for the Province of Ontario et al., 71 O.R. (3d) 291 (C.A.), [2004] O.J. No. 2634 (C.A.), the award of costs must be fixed in an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceedings rather than an exact measure of actual costs to the successful litigant.
[8] I have considered numerous factors in determining the amount of costs, including the following factors. Burnco filed significantly more material which is understandable given that it brought the motion and had to ensure that it brought the relevant case law before the court. There were additional costs to all parties given that three sets of material were filed. In addition, steps taken by EllisDon and Fox prolonged this motion and caused additional costs as they conducted a cross-examination of Burnco’s affiant on his affidavit. In turn, there were additional costs for Burnco to answer the undertakings.
[9] I concur with EllisDon’s submissions at paragraph 4(a) through (c) of its costs submissions; in effect that Burnco’s costs should be reduced to consider those factors.
[10] Although Mr. Slattery is senior counsel and considering my view that this motion was not complex, I conclude that his actual and partial indemnity hourly rates are excessive and unreasonable. For that reason, and for the above reasons, I have reduced Burnco’s costs.
[11] Another relevant consideration is the fact that there are two parties paying costs; therefore, in determining Burnco’s costs, I have considered what is fair and reasonable to both EllisDon and Fox to pay.
[12] I fix Burnco’s costs of this motion in the amount of $20,000 inclusive of fees, HST and disbursements, to be shared equally by EllisDon and Fox, payable within 30 days.
[13] Burnco’s claim is for $7.5 million approximately, while EllisDon seeks a set off claim and counterclaim of $6 million. Fox’s claim is for $2.6 million. In my view, the amount awarded for costs is in proportion to the amounts sought.