Court File and Parties

CITATION: CIBC Mortgages Inc. v. York Condominium Corporation No. 385, 2016 ONSC 8036

COURT FILE NO.: CV-14-517576

DATE: 20161221

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: CIBC Mortgages Inc., Applicant

AND:

York Condominium Corporation No. 385, Respondent

BEFORE: S.F. Dunphy, J.

COUNSEL: Benjamin Frydenberg, for the Applicant

Chetan Phull, for the Respondent

HEARD: In Writing

COSTS ENDORSEMENT

[1] I released my decision in these two related applications on November 24, 2016. I awarded the successful party, CIBC, costs and invited the parties to make written submissions not to exceed five pages regarding scale of costs and amount.

[2] What followed was a virtual blizzard of submissions by both parties without the tiniest regard for the limitations on submissions specifically imposed by me:

a. December 1, 2015, CIBC Costs Submission, (5 pp, exclusive of Outline (9pp));

b. On December 13, 2016, YCC Request to Reconsider, (2pp plus 18 pages of attached cases readily available on line despite my request not to do so);

c. December 15, 2016, CIBC Addendum, (3pp);

d. December 16, 2016, YCC Cost Submission, (14pp submissions followed by 12 cases, plus copies of statutory authorities and dockets);

e. December 19, 2016, CIBC Reply Cost Submissions, (4pp); and

f. December 20, 2016, YCC Reply to Reply, (3pp).

[3] Suffice it to say that the issue of costs has been thrashed out about as thoroughly as the case was fought.

[4] When the court sets size limitations on submissions, these are not to be treated as mere suggestions or guidelines to be followed or ignored as counsel’s fancy may dictate. If reply and reply to reply are not invited, they are not expected to be filed either except in extraordinary cases. The excessive zeal shown in diving as deeply into the matter of costs as has been done here is quite symptomatic of the manner in which the two applications were conducted. Proportionality and reasonableness ought ever to be the lodestar held in view when conducting litigation.

Request to Reconsider

[5] YCC asks that I reconsider my award of costs to CIBC as successful party. It does so on the basis that I have jurisdiction and that I had not heard submissions on the matter of costs.

[6] I do not propose to wade into the mire of whether I have jurisdiction. CIBC submits that YCC waited until after it had received CIBC’s costs submissions delivered per my order to make its position on reconsidering the costs award known. The question of jurisdiction is clearly one that is more theoretical than real. I might have been persuaded to issue an award of costs of $1.00 or nil based on the costs submissions received without having to “reconsider” my award of costs to the successful party. YCC did not lack the ability to make that submission in any event.

[7] I should like to remind the parties that costs are on the table at every appearance in court – be it a motion or an application (as was the case here). Both parties filed written arguments and had every opportunity to address the matter of costs generally and as deeply as they thought fit. I accept – and indeed made allowance for – the fact that offers to settle must necessarily be kept confidential before a ruling on the merits is made. In my view, if a party intends to argue that costs should not follow the event as they normally do, I expect a submission to that effect will be made in oral or written argument. I cannot accept that either side was denied an opportunity to address the issue of entitlement to costs – neither was prevented from expanding upon their facta by making submissions on the subject if thought advisable. If the existence of offers to settle may have rendered that submission awkward to advance, then a specific request not to rule on costs for that reason could be made orally or in writing. There is no prejudice to be feared from the mere revelation that the allocation of costs may require consideration of the settlement positions of one, the other or both parties.

[8] Parties should not be surprised to see that one side or the other has received costs as asked when they have failed to address the subject at all at the hearing (or have only addressed their own desire to receive costs if successful without addressing the opposite scenario). Every motion record contains a request for costs and every factum filed on a motion invariably contains one as well. Costs are part and parcel of deciding a motion. Indeed, absent consideration of settlement offers, the amount of costs is best spoken to when neither party knows who has been successful and the reasonable expectations of the losing party can be most candidly assessed.

[9] I have reviewed the Request to Reconsider of YCC and the Addendum of CIBC in response thereto. YCC’s main request is that no order of costs be made – I have all the jurisdiction I need to consider that request in connection with fixing scale and quantum of costs, both of which matters were reserved to me. I see no reason to reconsider my ruling that costs follow the event but will take all the submissions of the parties into account in considering scale and amount, up to and including considering the advisability of making a nil or nominal award as requested by YCC.

Scale of Costs

[10] The normal expectation is that costs are awarded to the successful on a partial indemnity basis. Among the factors that may argue for a higher scale of costs – in whole or in part- is settlement offers.

[11] No Rule 49-compliant offers to settle have been placed before me. CIBC did however make two offers to settle neither of which was formally compliant with Rule 49 of the Rules of Civil Procedure. CIBC nevertheless submits that I should have regard to them in exercising my discretion. Rule 49.13 of the Rules of Civil Procedure gives me full discretion to consider the amount, timing and terms of any offer to settle in exercising my discretion as to costs.

[12] Both offers (August 21, 2014 and July 8, 2016) would have seen the sales proceeds held in trust divided broadly in half (the latter offering somewhat less to YCC than the first). The precise amounts are not material so much as the fact that CBC offered a very real and substantial compromise and its offer was rejected. Both offers were very substantially advantageous to YCC who was entirely unsuccessful in its claim to full priority over CIBC’s mortgage. Costs might have been avoided had YCC show sufficient flexibility to compromise rather than insist as it did on an all-or-nothing hearing that it ultimately lost.

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