Moyer v. Vanderwere, 2016 ONSC 7346

CITATION: Moyer v. Vanderwere, 2016 ONSC 7346

COURT FILE NO.: CV-12-109119

DATE: 20161128

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Kenneth Moyer, Plaintiff

AND:

C.M. Vanderwere and Arnold R. Robbins and Agincourt Landscaping and Ainita K. Bhatt and Kiran Bhatt, Defendants

BEFORE: The Honourable Madam Justice A.M. Mullins

COUNSEL: David Fenicky, Counsel, for the Plaintiff

Siobahn McClelland, Counsel, for the Defendants

HEARD: September 26, 2016

COSTS ENDORSEMENT

Nature of the Proceedings

[1] The plaintiff, Kenneth Moyer, brought this action against the defendants, Agincourt Landscaping and C.M. Vanderwerf (incorrectly named as C.M. Vanderwere), for damages arising from a motor vehicle accident. After an 11-day trial, the jury awarded the plaintiff $2,500 in general damages and $500 for past loss of income, but no future special damages. Both parties seek their costs of the action.

[2] The plaintiff requests an order for partial indemnity costs, plus disbursements and HST.

[3] The defendants seek $50,000 for costs and disbursements on a partial indemnity scale.

[4] This personal injury action stems from a June 22, 2010 motor vehicle accident. The plaintiff initially claimed $1.5 million for loss of income, general damages, and future special damages.

[5] On January 4, 2013, the defendants admitted liability in exchange for the plaintiff reducing his claim to $1 million. The defendants’ admission was subject to threshold and deductible defences.

[6] At a mediation session on November 19, 2013, the parties exchanged settlement offers. The plaintiff’s best offer was for over $170,000, while the defendants’ best offer was an all-inclusive $30,000. The next day, the defendants made the same $30,000 offer to the plaintiff. This offer was revoked on October 5, 2014 when the defendants made their final settlement offer: a dismissal without costs, contingent on the plaintiff’s agreement to a Full and Final Release.

[7] On May 8, 2015, the plaintiff made his final settlement offer of $29,000, plus interest, costs, and disbursements.

[8] The trial proceeded between November 20, 2015 and December 4, 2015. The plaintiff called eleven witnesses; the defendants called four. The defendants also presented video footage.

[9] On February 19, 2016, Mullins J. granted judgment in favour of the defendants on their “threshold” motion under the Insurance Act, R.S.O. 1990, c. I.8.

Positions of the Parties

a. General Principles

[10] The parties note that costs are in the discretion of the court per s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43. They agree that this discretion is guided by the history of settlement offers and the factors listed under r. 57 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.

b. The Plaintiff’s Position

[11] The plaintiff argues that four factors under r. 57.01(1) support his costs claim:

i. (0.a) the principle of indemnity,

ii. (0.b) the unsuccessful party’s reasonable expectations,

iii. (b) the apportionment of liability, and

iv. (c) the complexity of the proceedings.

[12] The plaintiff contends that he should be partially indemnified for his cost claims because he was successful in obtaining a damages award at trial. The costs sought are commensurate with the experience of his counsel and the hours spent on the five-year long action. The defendants admitted liability. The nature of his injury claims, including soft tissue injuries and chronic pain syndrome, necessitated a relatively lengthy trial and the examination of expert witnesses.

[13] The costs claimed could have been reasonably contemplated by the defendants, considering the length and complexity of the action. He says the cost award should be proportional to these reasonable expectations, not the jury’s award. In support of this position, he cites Corbett v. Odorico, 2016 ONSC 2961, 266 A.C.W.S. (3d) 47. In Corbett, Hackland J. awarded costs that were greater than the judgment award because (i) the costs were readily foreseeable and (ii) the lack of a genuine settlement offer compelled the plaintiffs to pursue their case through trial (at para. 20).

[14] The plaintiff posits that the settlement offers cannot factor into the cost award decision because neither party’s final offer was more favourable to the opposite party than the result obtained at trial.

c. The Defendants’ Position

[15] The defendants’ cost claim is based on (i) their substantial success, (ii) the r. 57.01(1) factors, (iii) the history of settlement offers, and (iv) the monetary forum of the action.

i. Substantial Success

[16] The defendants argue that they are entitled to costs because they were substantially successful in defending the action. The jury declined to award future or special damages and the plaintiff had no net recovery of general damages because the $2,500 award was below the statutory deductible.

[17] The defendants also contend that the plaintiff should be liable for costs because he failed to meet the statutory threshold under the Insurance Act. In support of this position, they cite Myers J.’s decision in Saleh v. Nebel, 2015 ONSC 3680, 254 A.C.W.S. (3d) 782. At para. 19, Myers J. held that “A plaintiff who brings an action who does not meet the threshold should be exposed to the risk of costs just like any other plaintiff who brings a lawsuit that she or he was not entitled to bring at law.”

ii. Rule 57 Factors

[18] The defendants argue that the following r. 57.01(1) factors support their costs claim:

i. (a) the amount claimed and the amount awarded,

ii. (e) the conduct of any party that shortened or unnecessarily lengthened the duration of the proceeding,

iii. (g) a party’s refusal to admit anything that should have been admitted, and

iv. (i) other matters relevant to costs.

[19] The plaintiff’s $1 million claim far exceeded his total recoverable award of $500. The defendants reduced the length of trial by admitting liability early on, while the plaintiff called a number of unnecessary witnesses. The defendants argue that it is relevant to costs that the evidence of the plaintiff’s experts was not accepted by the trial judge or jury, and that his counsel put forward arguments that were not supported by evidence.

iii. History Settlement Offers

[20] The defendants argue that the court should exercise its discretion under r. 49.13 and consider their all-inclusive $30,000 offer and their offer to dismiss the action without costs.

[21] (The defendants also make reference to the exchange of offers at mediation. There is no indication that the defendants’ mediation offers were made in writing, and thus, within the scope of r. 49.13. Nor is it clear why offers made at a mediation should ever attract cost consequences.)

iv. The Appropriate Monetary Forum

[22] The plaintiff is disentitled to costs, submit the defendants, because the action should have been brought to the Small Claims Court or commenced under the Simplified Rules. According to r. 57.05(1), a court may decline to award the plaintiff costs if the “plaintiff recovers an amount within the monetary jurisdiction of the Small Claims Court”. Rule 76.13 says that a plaintiff should generally not receive costs where the judgment award was below $100,000.

[23] The defendants argue that they are entitled to the additional costs of defending the action under the ordinary procedure. Under r. 76.13(6), the court may order the plaintiff to pay the defendant’s costs when the action should have been brought under the Simplified Rules.

Disposition

[24] The nature of this claim was for damages for personal injuries alleged to have been caused in a motor vehicle collision. The permanence and seriousness of the injuries alleged was premised on the evidence that the plaintiff developed a chronic pain syndrome.

[25] Following mediation the defendant had offered to settle the claim for $30,000. The plaintiff served an offer to settle six months before the trial proceeded for the sum of $29,000. I infer from these offers that the expectations of the parties as to the amounts potentially recoverable in the proceeding approximated $30,000, although, to be fair, the quantum that may have been anticipated to be awarded by a jury is always, to some extent, not foreseeable. The plaintiff recovered a damage award of $500 after an eleven day jury trial. The defendant was successful in the threshold motion. Regardless, the deductible reduced the general damage award of $2,500 to nothing. Success in the proceeding was I consider, divided. The amount recovered was substantially less than that claimed. The issues in the proceeding were not complex, even though a significant volume of evidence was, and generally is, required to establish that a plaintiff is suffering from serious permanent impairments of important functions, has lost income and will incur medical expenses, due to a chronic pain syndrome. The sum recovered by the plaintiff after trial was within the monetary jurisdiction of the small claims court. The matter might also have proceeded under the Simplified Rules which may have reduced costs to both parties. In this sense, a more expeditious proceeding might have been chosen. There was no conduct by either party that served to extend the proceeding, nor was the conduct of counsel other than exemplary.

[26] Given that the plaintiff did recover an award from the jury and was successful in the trial he is, I suppose, presumptively entitled to costs. The defendants were successful in the outcome of the threshold motion, so they are presumptively entitled to costs. The quantum recovered by the plaintiff is so modest it would be grossly disproportionate to make an award which approaches indemnity for the costs the plaintiff has outlined of $71,397.27. As to the costs outlined by the defendant, those associated to the motion are not readily discernable.

[27] Having regard to all of the circumstances and the discretionary factors that I have weighed, the plaintiff shall recover costs from the defendant of the trial, fixed at $9,000, together with HST. The defendant shall have the costs of the threshold motion payable by the plaintiff fixed at $2,500 together with HST.

Madam Justice A.M. Mullins

Date: November 28, 2016