Citation: Fountain Asset Corp. v. First Global Data, 2017 ONSC 5602

Court File No.: CV-17-569015 Date: 2017-09-20 Superior Court of Justice - Ontario

Re: Fountain Asset Corp., Applicant And: First Global Data Limited, Respondent

Before: Madam Justice Kristjanson

Counsel: Geoff Moysa, for the Applicant Robert P. Hine, for the Respondent

Heard: In Writing

Ruling on costs

[1] In August, 2017, in a motion brought by First Global Data I ruled that claims in the application brought by Fountain Asset Corp. be raised by way of counterclaim in another action (the “2017 Action”) recently commenced by First Global Data against Fountain Asset and other parties. I also ruled that cross-examinations conducted to date are to form part of the examinations for discovery in both the 2017 Action and counterclaim. I requested costs submissions on the motion to convert and consolidate.

[2] On this one day motion, First Global Data seeks its costs on a partial indemnity basis in the amount of $88,608.95 and disbursements in the amount of $28,694.95, both inclusive of HST. First Global claims 322.5 hours on this motion. This is clearly excessive. First Global seeks to recover almost all the costs associated with the application and the motion, since inception. Most of the time was spent well before First Global brought the motion, and well before First Global commenced the 2017 Action. The only concession appears to be that since the cross-examinations on affidavit are to form part of the examinations for discovery in the action and counterclaim, it seeks only half its legal fees (and the full cost of the transcripts).

[3] I cannot tell how much time was spent on the motion, since First Global did not separate time spent on the application and time spent on the motion. By contrast, Fountain Asset did so properly, identifying costs relating to the application, to scheduling court, to cross-examinations, and to the motion. The overall costs outline is comparable, but costs of the motion are separated out and constitute approximately $5,000.00 in fees on a partial indemnity basis relating to the motion. Since First Global has failed to separate out costs relating to the motion from other costs of the application, I cannot determine costs relating to the motion. I also note that it was First Global’s delay that led to the scheduling and case management appearances, and the fact that the motion was argued on the return date of the application rather than before.

[4] I agree with Fountain Asset that in the circumstances of this case, the costs of the motion be awarded in the cause: Gafny v. Vainshtein, 2016 ONSC 4030 at para. 4; Masales v. Cole, 2016 ONSC 1814 at para. 11. The merits have yet to be adjudicated. The work product created to date, including affidavits, productions, the expert report and cross-examination transcripts will be used at trial. The application was reasonably brought, and Fountain Asset may still prevail. The costs incurred to date have not been wasted, and “much of the legal work for the application can be carried forward into the action, and, therefore, costs should follow the ultimate outcome of the action”: Allied Systems (Canada) Co. v. Honda Canada Inc., 2012 ONSC 3142 at para. 23.

[5] As a result, I order that the costs of the motion be awarded in the cause.

Kristjanson J.

Date: September 20, 2017