BACKGROUND

[1] The Applicant brought an Application for Judgment in respect of the Respondent’s failure to complete an Agreement of Purchase and Sale claiming damages in the amount of $340,497.78. For Reasons for Judgment dated August 17, 2016, I awarded damages in the amount of $129,338.17 plus pre-judgment interest and costs to the Applicant.

[2] The Applicant claims $27,090.17 in legal fees and $3,426.49 in disbursements on a partial indemnity basis. The Respondent submits that the proceedings were of average complexity. The Respondent submits that the time expended by counsel for the Applicant was excessive and should be reduced by 25%. The Respondent takes no issue with the claim for disbursements.

ANALYSIS

[3] I agree with the following statement made by Justice Myers in Fimax Investments v. Grossman, 2015 ONSC 2048, at para.7:

The fixing of costs is a discretionary decision under s.131 of the Courts of Justice Act. That discretion is generally to be exercised in accordance with the factors listed in Rule 57.01 of the Rules of Civil Procedure. These include the principle of indemnity for the successful party (57.01(1)(0.a)), the expectations of the unsuccessful party (57.01(1)(0.b)), the amount claimed and recovered (57.01(1)(a)), and the complexity of the issues (57.01(1)(c)). Overall, the court is required to consider what is “fair and reasonable” in fixing costs, and is to do so with a view to balancing compensation of the successful party with the goal of fostering access to justice: Boucher v. Public Accountants Council (Ontario), (2004), 71 O.R. (3d) 291 (Ont. C.A.), at paras 26, 37.

[4] Further, Rule 1.04(1.1) of the Rules of Civil Procedure provides that:

In applying these rules, the court shall make orders and give directions that are proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding.

[5] In my view, the principle of proportionality informs the balancing of interests in deciding whether an award of costs is “fair and reasonable”: see Strudwick v. Applied Consumer & Clinical Evaluations Inc., 2016 ONCA 520, at paras. 126-7.

[6] I now turn to assess the various relevant considerations in assessing costs in this matter.

Result in the Proceeding

[7] As noted, the Application was granted. The claim for damages of $125,000.00 in breach of contract was granted. The claim for $215,497.78 for failure to submit lease payment between 2014 and 2017 was largely unsuccessful as only $4,338.17 was awarded in this respect.

Offers to Settle

[8] Curiously, there is no evidence of settlement offers having been exchanged between the parties.

Principle of Indemnity

[9] The Applicant claims partial indemnity costs in the amount of $30,516.66 comprised of:

Fees, including HST: $27,090.17;
Disbursements, including HST: $3,426.49.

[10] The Respondent takes no issue with the partial indemnity rates claimed by the Applicant.

[11] However, the Respondent submits that the Bill of Costs shows that the time expended by counsel and paralegals totaled 211.2 hours. The Respondent submits that the amount of time spent is excessive and should be reduced by 25%. My calculations, in reviewing the Bill of Costs, shows that the Respondent has grossly overestimated the time spent by counsel in that that far less than 211.2 hours is claimed by the Applicant:

Name	Hourly Rate	Total Hours
Tanya Walker	$210	77.6
Andrew Oostrom	$150	28.7
Ke-Jia Chong	$150	13.2
Paralegals	$72	2.8

[12] The time claimed by the Applicant covers all steps in this Application from its commencement through examinations and various appearances in court.

The Amount that an Unsuccessful Party could Reasonably Expect to Pay

[13] Typically a comparison of the costs sought by the parties assists in determining what amount was reasonably within the reasonable contemplation of the losing party. Counsel for the Respondent has not provided his Bill of Costs to the Respondent. Accordingly, the reasonable expectations of the Respondent cannot be assessed.

The Amount Claimed and the Amount Recovered

[14] As noted above, the Applicant has partially recovered the amount claimed.

The Apportionment of Liability

[15] This consideration has no application on the facts of this case.

The Complexity of the Proceeding

[16] I accept the Respondent’s submission that this proceeding was of average complexity.

The Importance of the Issues

[17] The Applicant submits that the issues were important to the Applicant because it had not received payment pursuant to the Agreement of Purchase and Sale. In my view, this submission addresses the importance of the Application, rather than the issues raised by the Application, to the Applicant rather than the importance of the issues raised by the Application, whether on a jurisprudential or reputational basis, to the Applicant.

The Conduct of any Party that Tended to Shorten or Lengthen Unnecessarily the Duration of the Proceeding

[18] The Applicant submits that the Respondent failed to deliver a Responding Record to this Application by the date that the parties had agreed upon and that the Applicant had to bring a motion and obtain an order from Master Haberman that required such Record by April 16, 2015 and completion of cross-examination by April 30, 2015. The Respondent did not adhere to the cross-examination timetable. Justice Firestone ordered another timetable with completion of examinations by August 28, 2015. The cross-examinations were re-scheduled with the Applicant’s consent to October 2, 2015 and then again to October 13, 2015. The Respondent failed to appear at his examination on October 13, 2015. The Respondent’s examination was completed after I ordered same on February 9, 2016.

[19] The Applicant submits that various defences, including compliance with the Bulk Sales Act, were withdrawn only at the hearing of this Application and resulted in unnecessary costs.

Whether any Step in the Proceeding was Improper, Vexatious or Unnecessary or Taken Through Negligence, Mistake or Excessive Caution

[20] No submissions were made in this respect.

A Party’s Denial of or Refusal to Admit Anything that Should Have Been Admitted

[21] The Applicant submits that the Respondent should have consented to Judgment as the Applicant “… demonstrated that it was owed funds for the purchase of the asset and lease.”

[22] In my view, the Respondent’s position raised triable issues.

Whether it is Appropriate to Award any Costs or More Than One Set of Costs Where a Party Commenced Separate Proceedings

[23] No submissions were made in this respect.

Conclusions

[24] Having considered the submissions of the parties and the factors described above, including the principle of proportionality, I find that it is fair and reasonable to award the sum of $30,516.66 in costs, inclusive of taxes and disbursements, to the Applicant payable forthwith by the Respondent.

2316796 Ontario Inc. v. Chetti, 2016 ONSC 62217

Case Summary