Court File and Parties

COURT FILE NO.: 16-69665 DATE: 2017/05/05 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: BRUCE WALLACE, Plaintiff/Defendant by Counterclaim -and- STEPHEN CAMPBELL, PAMELA F. CAMPBELL, and GRYPHON’S HEAD PROPERTIES LIMITED, Defendants/Plaintiffs by Counterclaim

BEFORE: Mr. Justice Robert N. Beaudoin

COUNSEL: J.L. Lee Mullowney, Counsel, for the Plaintiff/Defendant by Counterclaim Andrew J. F. Lenz, Counsel for the Defendants/Plaintiffs by Counterclaim

HEARD: By written submissions

COSTS ENDORSEMENT

[1] On February 24th, 2017, I dismissed a motion brought by the plaintiff/defendant by counterclaim, Bruce Wallace (Wallace) wherein he sought an order directing the issuance of a Certificate of Pending Litigation (CPL) in respect of two properties. In the alternative, he sought an order that $450,000 of the property sale proceeds currently held in trust be deposited with the court to the credit of this action and that the said funds stand in place of the property sold.

[2] In dismissing that motion, I concluded that the evidence fell far short in demonstrating that Wallace had a reasonable claim to either of the properties in question. Moreover, I concluded that the evidentiary record before me favoured the defendant/plaintiff by counterclaim Steven Campbell (Campbell).

[3] The Campbell now seeks his costs. He maintains that the motion was not even close and that it should never have been brought. His counsel has produced copies of the exchange of correspondence between himself and counsel for the plaintiff dated December 14, 2016. In that letter, he referred to the extensive materials that had been prepared in response to the motion and invited the plaintiff to reconsider the motion.

[4] While Campbell’s counsel attended at the motion and provided a costs outline wherein he sought substantial indemnity costs of $17,312.04 for fees, an appearance fee as well as disbursements; counsel for the plaintiff did not have a costs outline as required by Rule 57.01(6). I directed him to provide me with one by the end of the day which he did.

[5] One of the purposes of the costs outline is to force a party to commit to an amount that they would be seeking costs so that, in the event, that they are unsuccessful on the motion, they cannot be heard to say that the motion was simple or unimportant in order to diminish the cost of which would be otherwise payable. A costs outline is an important tool in assessing the amount that an unsuccessful party could be expected to pay. A costs outline delivered after the fact is simply not as reliable as one delivered in accordance with the rule.

[6] While Wallace’s counsel submitted that his client has financial difficulties, the evidence on the motion persuaded me that the plaintiff had received several hundred thousand dollars over the course of his business relationship with Campbell and that he has not accounted for these sums. Wallace submits that an appropriate costs award in the circumstances should be between $5,000-$7,500 inclusive of disbursements and HST and that these should payable in the cause.

[7] He submits that the materials on the motion were not voluminous and that no cross-examinations took place and that the argument lasted an hour. He further submits that the defendants will be able to make use of their motion materials in defending his claims and in prosecuting their counterclaim.

[8] He adds that the parties had jointly agreed to the relief sought in the motion prior to the sale of the properties in question. The terms of that agreement were negotiated between former counsel for both sides.

[9] He adds that no formal offers were exchanged in relation to the motion and disputes the defendant’s argument that the exchange of correspondence between counsel justifies an award of costs on a substantial indemnity scale.

[10] In turn, he suggests that if an offer to settle was made, it came from the plaintiff who suggested that the entire matter be resolved by way of an actuary’s report. The defendant rejected the suggestion, indicating that he preferred that the motion be dealt with.

[11] The plaintiff concludes that the costs claimed by Campbell in relation to the motion are: in excess of the amount of costs than an unsuccessful party could reasonably expect to pay; disproportionate to the complexity of the proceeding; and that the costs awarded in similar CPL motions are well below those claimed.

Conclusion

[12] While there was no formal offer to settle motion, the extensive materials produced by Campbell should have convinced the plaintiff that he had a little chance to succeed on his motion. While there may have been an agreement with previous counsel, Wallace had an opportunity to reconsider the issue.

[13] The motion materials filed by the plaintiff in this matter were minimal. While he acknowledges that responding record was more extensive, he has tried to argue that these materials will be of use later in defending his claims and in prosecuting the counterclaim. That argument is not persuasive. Campbell needed to provide these materials in order to prevent the harm he continued to suffer while this the alternative form of security remained place.

[14] Given the agreement of previous counsel to resolve the issue of the CPL’s placed on the properties, I conclude that this is not an appropriate case for substantial indemnity costs. Given the extensive materials that were prepared, I nevertheless assess Campbell’s costs on a partial indemnity basis in the amount of $10,000.

[15] While Wallace makes claims of financial hardship, he still has to account for all the funds he received over time. He decided to proceed with his motion despite the detailed and comprehensive responding record. For these reasons, I am not satisfied that I should depart from the presumptive rule [1] that costs of this motion should be paid within 30 days and an order shall issue accordingly.

Mr. Justice Robert N. Beaudoin Date: May 05, 2017

Footnotes

[1] Rule 57.03(1)(a)