1668135 Ontario Inc. v. City of Vaughan, 2017 ONSC 3936

CITATION: 1668135 Ontario Inc. v. City of Vaughan, 2017 ONSC 3936

COURT FILE NO.: CV-16-561498

DATE: 20170626

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: 1668135 ONTARIO INC., Applicant

AND:

THE CITY OF VAUGHAN, Respondent

BEFORE: Mr. Justice P.J. Cavanagh

COUNSEL: Tanya A. Pagliaroli, for the Applicant

Catherine DiMarco, for the Respondent

HEARD: Submissions in Writing

COSTS ENDORSEMENT

[1] In my Reasons for Decision, I granted declaratory relief that allowed the Applicant to move certain equipment to and from the Phase 2 lands via Campania Court to be used for certain purposes pursuant to section 4 of the Development Agreement made between the Applicant and the Respondent. I directed that the balance of the relief sought by the Applicant on this application shall proceed to trial.

[2] The Applicant seeks costs on a partial indemnity scale in the amount of $58,467.33 inclusive of disbursements and HST. The Applicant submits that it was successful on its application and that there are no circumstances which justify departure from the usual rule that costs are awarded in favour of the successful party.

[3] The Respondent also seeks costs on a partial indemnity scale in the amount of $39,553.09. The Respondent submits that it was never in dispute that the Applicant was entitled to use Campania Court to gain access to the property for the purposes of “importing equipment on vehicles not being able to manoeuvre safely through the Phase 1 lands”, the language in the Development Agreement. The Respondent submits that it was not necessary for the Applicant to commence this application in order to import and export equipment onto the Phase 2 lands which, the Respondent submits, is expressly and clearly permitted by section 4 of the Development Agreement.

[4] With respect to the relief that was granted, the Applicant submits that in its Fresh as Amended Notice of Application and in its Factum, the Applicants sought a declaration that it is entitled to access the property through Campania Court for the purposes of remediating and servicing the property and completing maintenance and repairs: s.1 (a), s. 2(p) of Fresh as Amended Notice of Application; Applicant’s Factum, para. 2.

[5] The Applicant submits that the access granted to it as a result of the order that was made will allow the Applicant to obtain the Record of Site Condition which is a precondition to the subdivision agreement. The subdivision agreement will provide the Applicant with access to Campania Court for the purposes of further developing the property, including the servicing and construction. The Applicant submits that, in this sense, it was successful and met the high threshold of establishing its rights. The Applicant submits that prior to the relief being granted as a result of this Application, and since September 2015, the Applicant’s access to its property through Campania Court was physically blocked by the Respondent for all purposes.

[6] The Respondent submits that the Applicant “cast the net wide” in terms of its claimed entitlement to use Campania Court pursuant to the Remediation Action Plan and based upon discussions between Mr. Gentile representing the Applicant and a representative of the Respondent. The Respondent submits that the application materials demonstrate that the Applicant was seeking full access to the Phase 2 lands through Campania Court and that the real reason that the Applicant wanted such access was to be able to haul truckloads of material off the Phase 2 lands. The Respondent also submits that the Applicant sought access through Campania Court on the basis of allegations of bad faith on the part of the Respondent. The Respondent submits that it is entitled to its costs of this portion of the Applicant’s arguments with respect to the allegations of bad faith.

[7] In response to the Respondent’s submissions, the Applicant submits that the position that was taken by the Respondent was that the Applicant would not be granted permission to access the Phase 2 lands via Campania Court until a subdivision agreement was entered into. The Applicant submits that, prior to the hearing of the Application on March 8, 2017, the Respondent had not advised that it would permit access to the Phase 2 lands via Campania Court before a subdivision agreement was entered into, for any purpose and on any terms. The Applicant submits that, therefore, the Application was necessary.

[8] I accept the Applicant’s submission that part of the relief sought at the hearing of the Application was access to the Phase 2 lands via Campania Court pursuant to section 4 of the Development Agreement for the purpose of moving large machinery and equipment to and from the lands in order to engage in remediating the lands. In her oral submissions, counsel for the Applicant drew a distinction between remediation and hauling, and submitted that hauling is not primarily what the Applicant is seeking. The relief sought by the Applicant was certainly significantly broader than enforcement of its rights pursuant to section 4 of the Development Agreement and the Applicant was not successful in obtaining the expanded relief through the application that was heard on March 8, 2017. The balance of the relief sought by the Applicant was ordered to proceed to trial.

[9] Fixing of costs is a discretionary decision under section 131 of the Courts of Justice Act. The discretion is to be exercised in accordance with the factors listed in Rule 57.01 of the Rules of Civil Procedure, including the principle of indemnity, the expectations of the unsuccessful party, and the complexity of the issues. Overall, the court is required to consider what is “fair and reasonable”, with a view to balancing compensation to the successful part with the goal of fostering access to justice (Boucher v Public Accountants Council (Ontario), 2004 CanLII 14579, (2004), 71 O.R. (3d) 291 (Ont. C.A.), at paras 26, 37.)

[10] In my view, the Applicant was successful in obtaining a significant remedy that will allow it to proceed with the remediation of the Phase 2 lands and to move to the next stage of development. As the successful party, the Applicant is entitled to costs on a partial indemnity scale.

[11] With respect to the amount of costs requested by the Applicant, the bulk of the fees claimed is comprised of its lead counsel’s time spent preparing for and arguing the Application. This work included preparing an extensive two-volume record, preparing for and attending on three cross examinations, preparing a Factum and attending a full day hearing. The Applicant submits that the amount of time spent was reasonable given the number of witnesses, the size and scope of the case, the importance of the issues and the need for the Applicant to put its best foot forward to satisfy the high threshold of establishing its rights.

[12] The amount of time spent by the lawyers for the Applicant does not vary significantly from the amount of time spent by the lawyers for the Respondent. In my view, the amount of time spent was reasonable and proportionate, having regard to the subject matter of the Application and the importance of the Application to the Applicant. In my view, the partial indemnity rate used by the Applicant for its lead counsel of $350 per hour is, in this case, reasonable and appropriate.

[13] I do not agree that the Respondent is entitled to costs for the portion of the Application that was concerned with allegations of bad faith on the part of the Respondent. In my Reasons for Decision, I ordered that the balance of the relief claimed by the Applicant proceed to trial, so there has not been an adjudication of this portion of the Application.

[14] I therefore fix costs of the Application, to the extent that it was heard on March 8, 2017 and partially decided on April 21, 2017, in the amount of $58,467.33 (inclusive of disbursements of $3,106 and HST on fees and disbursements), to be paid by the Respondent to the Applicant within 30 days.

Mr. Justice P.J. Cavanagh

Date: June 26, 2017