Court File and Parties

Court File No.: FC-13-709-0 Date: 2017/06/15 Ontario Superior Court of Justice

Between: Farhad Derakhshan, Applicant And: Seema Narula, Respondent

Counsel: Farhad Derakhshan, Self-Represented Ian Vallance and Denyse Boulet, for the Respondent

Heard: By Written Submissions

Cost Decision ON Motion for security for costs

Before: L. Sheard J.

[1] This cost decision is in respect of the motion brought by the respondent, Seema Narula, for security for costs. The motion was dismissed on April 5, 2017 by way of written reasons. If the parties could not agree on costs, they were invited to file written submissions. This cost decision follows the written submissions filed by the parties.

Positions of the Parties

[2] The applicant/respondent on the motion, Farhad Derakhshan, asks for costs of $6,707.00. He was self-represented.

[3] To understand Derakshan’s claim for costs, it must be recognized that this was one of two motions brought in the course of the trial. The first motion was brought by Derakhshan, seeking various relief, which was dismissed with costs to Narula.

[4] Both motions were scheduled to be argued on February 28, 2017. After hearing Derakhshan’s motion, there was no time left to hear Narula’s motion for security for costs. The parties agreed that Narula’s motion would proceed in writing.

[5] In his written cost submissions of May 3, 2017, Derakhshan referred to the time he spent on his motion and on responding to Narula’s motion. Derakhshan stated that he deducted some time spent on the combined motions to arrive at the figure of $6,707.00 explained as follows:

(i) 1.5 days preparation +1.5 consultation days @ 8 hours a day at $150/hour (Time deducted for combined motions) $3,600.00 (ii) Court run serving documents by hand, waiting at the counter 4 half days = 2 days @ 8 hours a day @ $150/hour $1,000.00 (iii) Consultation fees paid to first lawyer: 1 hour $ 500.00 (iv) Consultation fees paid to second lawyer 8 hours ($1,000 +$750.00) $1,000.00 (time deducted for combined motions) (v) Time lost on the day of the motion, 1 day divided by 2 $ 500.00 (vi) Photocopying, printing, binding and tabs $ 75.00 (vii) Parking (City Hall) 1 full day + 2 half days $ 32.00 Total: $6,707.00

[6] Narula states that any costs awarded to Derakhshan should be nominal, if at all.

[7] Narula disputes that there is any basis for awarding any amount for legal fees and points out that the fees charged by lawyer, Gregory Ste. Marie, are from April 2016, before Narula brought her motion. Further, the services rendered appear to relate to trial preparation.

[8] Narula asserts that by submitting an invoice for legal services rendered long before Narula even brought her motion, Derakhshan is attempting to recover costs of trial preparation and is trying to mislead the Court.

[9] Derakhshan also included a letter addressed to him from a different lawyer, Eric Letts, dated April 30, 2017. This letter appears to be a statement rather than an invoice. It reads, in part:

As per your request, my fees for assisting with the security for costs issue are as follows: review endorsement and research case law, one hour; forward case law and correspondence .25 hours and meeting with Mr. Derakhshan on respecting security for costs motion, 2.0 hours. Total 3.25 hours at $300 for a total of $975 plus disbursements of $25 for a total of $1000 plus HST of $130. I trust this is sufficient for present purposes.

[10] It is unclear, which, if any, of the materials filed by Derakhshan in response to Narula’s motion were prepared with the assistance of Mr. Letts. In Volume 6 of the Continuing Record there is a Notice of Cross-Motion dated April 28, 2017 brought by Derakhshan. In it, he seeks an order dismissing Narula’s claim for security for costs.

[11] In support of his cross-motion, Derakhshan submitted a four-page affidavit. The affidavit attempts to explain why the trial has taken so long and repeats many of the allegations made by Derakhshan in his application, which is the subject of the trial. Derakhshan also filed a three-page factum. Neither Derakhshan’s affidavit nor his factum was of any assistance to the Court in the determination of Narula’s motion.

[12] Following the hearing on February 28, 2017, the parties were permitted to make written submissions on the motion. Derakhshan’s submissions were made by way of a letter dated March 9, 2017. In it, he referred to case law. Although this document was brief, the submissions found at page 2 were on point and were considered by the Court in determining Narula’s motion. It is reasonable to conclude that Derakhshan did have legal assistance in preparing these submissions.

[13] Narula asserts that as Derakhshan is claiming legal fees, he cannot also claim his earnings lost by reason of the time he spent with his lawyer or otherwise preparing a response to Narula’s motion.

[14] In support of his submissions that he lost time from work, Derakhshan included a letter from an individual, Sandra Ng, dated May 2, 2017. Ms Ng states that she had hired Derakhshan to do some renovations to her home and that Derakhshan was unable to complete the work in his promised timeframe. Ms Ng states that Derakhshan told her that the court case “pulled him away from his work”. Ms Ng did not provide any information as to Derakhshan’s hourly rate from which the Court might calculate Derakhshan’s lost income, if any, attributable to Narula’s motion.

Analysis

[15] The Ontario Court of Appeal in Serra v. Serra, 2009 ONCA 395 identifies the three fundamental purposes of the costs rules:

1. to indemnify successful litigants for the costs of litigation;
2. to encourage settlement; and
3. to discourage and sanction inappropriate behaviour by litigants.

Factors

[16] Rule 2(2) of the Family Law Rules (O. Reg 114/99) (the “FLR”) provides the starting point for this cost decision. It states that: “the primary objective of these rules is to enable the court to deal with cases justly.”

[17] The case law is clear that a successful party is presumed to be entitled to costs (Berta v. Berta, 2015 ONCA 918).

[18] Rule 24 of the FLR lists the factors that the court shall consider in setting the amount of costs. Those factors include the reasonableness of the behaviour of each party; any offer to settle; any acts of bad faith by any party; the importance, complexity, or difficulty of the matter; the scale of costs; the hourly rates and time spent; and the reasonable expectations of the losing party.

Success

[19] While Narula was unsuccessful on her motion for Security for Costs, I cannot conclude that she was unreasonable in bringing it. Narula’s concerns about costs being unnecessarily incurred by reason of Derakhshan’s lack of preparation for trial and lack of focus during the trial were well-founded. Indeed, in submissions on his own motion, Derakhshan conceded that his handling “of the case thus far has been erratic and may be unfocused.”

Complexity and Importance

[20] The issues on this motion were not complex but were of great importance to both parties. Had Narula’s motion been granted, it would have had a significant financial impact upon Derakhshan on and, possibly on his ability to continue with the trial.

Reasonableness or Unreasonableness of Each Parties Behaviour

[21] For the reasons set out above, I do not conclude that Narula was unreasonable in bringing this motion. In submissions from her counsel dated May 17, 2017, Narula points out that on April 28, 2017, the last day of the trial, Derakhshan consented to the issuance of a preservation order and to its registration against his share of the property at 1375 Cedarcroft Crescent, Gloucester, Ontario. However, given that the preservation order was granted on consent, and after the dismissal of Narula’s motion for security for costs, it would be unfair to use that order as evidence that Derakhshan acknowledged that Narula was entitled to security for her costs.

Scale of Costs and Hourly Rates

[22] The best evidence on this motion respecting the costs incurred by Derakhshan on this motion is set out in the letter from Eric Letts dated April 30, 2017. On the reasonable assumption that Mr. Letts prepared Derakshan’s factum and the bulk of the submissions set out in Derakhshan’s letter of March 9, 2017, the time spent of 3.25 hours does not seem unreasonable. Based on the evidence filed, the Court accepts that Derakhshan incurred legal fees and disbursements of $1,130.00 with Letts, to respond to Narula’s motion.

[23] There is no reliable evidence that Derakhshan’s time should be valued at $150 per hour or that he lost any time from work by reason of Narula’s motion. Therefore, no costs are awarded for lost income.

[24] Other than for Derakshan’s assertions, he provides no supporting documentation to support his claim for $75.00 in disbursements for photocopying, printing, binding and tabs. Certainly, with respect to this motion, none of the materials he filed were bound. Accordingly, $25.00 is allowed for photocopying, printing and tabs.

Disposition

[25] Based on the evidence of his legal costs, I conclude that Derakhshan’s fair and reasonable costs, fixed on a partial indemnity basis, as follows:

(i) Letts’ fees $975.00 x 60% +$25.00 disbursement $610.00 (ii) HST on $610.00 $ 79.30 (iii) Derakhshan disbursements $ 25.00 TOTAL: $714.30

[26] For the reasons set out above, costs awarded to Derakhshan on this motion are $714.30.

[27] In her costs submissions, Narula states that Derakhshan has not yet paid her the costs awarded to her on Derakhshan’s motion. Accordingly, I order that the costs awarded to Derakhshan on this motion ($714.30) shall be set-off against the costs he was ordered to pay Narula on his unsuccessful motion to amend his pleadings and for other relief.

L. Sheard J.

DATE: June 15, 2017