CITATION: Berg v. Marks, 2017 ONSC 5799

COURT FILE NO.: CV-11-1103-00SR

DATE: 20170928

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

TERENCE BERG and MATILDA BERG

Plaintiffs

– and –

MARILYN SUSAN MARKS

Respondent

COUNSEL:

Eric Gionet, for the Plaintiffs

Self Represented

HEARD: IN WRITING

RULING ON COSTS

VALLEE J.

Background

[1] This action resulted in a ten day trial. The plaintiffs were entirely successful.

[2] The plaintiffs have an easement over part of the defendant’s property described as a laneway. Within that easement is located a catchbasin. Evidence showed that when the catchbasin was constructed in the early 1980s, it was to provide drainage for the parties’ adjacent properties. An easement containing a right of way was registered on title to the property that the defendant ultimately purchased, setting out the plaintiffs’ access in, over and upon the laneway. The easement was part of the property description when the defendant purchased her property.

[3] In 2006, the defendant erroneously took the position that the catchbasin was a drainage pit for her use only. She stated that the plaintiffs were not entitled to use the catchbasin for drainage. In 2010, the defendant poured a concrete pad over the top of the catchbasin, thereby intentionally depriving the plaintiff of any use of it. The plaintiff’s building, which contained apartments, was damaged by water that was unable to drain. According to the defendant’s evidence, in February 2013, when the plaintiffs sent her a video from a scope inspection showing a lateral pipe from the catchbasin to the road, she became aware that the catchbasin was not a drainage pit. It was connected to the municipal storm sewer.

[4] The plaintiffs suffered damages in excess of $200,000. Because they commenced their action within the simplified procedure, their damages claim was limited to $100,000. The defendant made a counterclaim alleging that she had suffered damages due to the fact that the plaintiffs’ water was not draining appropriately, among other things. At trial, the plaintiffs were awarded the full amount of their claim together with three requested declarations including that work required to reinstate the catchbasin proceed. The defendant was unsuccessful on her counterclaim.

Plaintiffs’ Offers to Settle

[5] The plaintiffs served two offers to settle on the defendant dated December 19, 2016 and May 2, 2017. The relevant part of the first offer was that the defendant would allow the work to reinstate the catchbasin, pay the plaintiffs $65,000 and not interfere with the plaintiffs’ right of way. The relevant part of the second offer was that the defendant would allow the reinstatement work, make no payment to the plaintiffs and not interfere with the plaintiffs’ right of way. At trial, the plaintiffs were significantly more successful than the terms of both of these offers.

[6] According to Rule 49, the plaintiffs are entitled to partial indemnity costs up to the date of the first offer, December 9, 2016 and subsequently full indemnity costs. I have reviewed the plaintiffs’ costs outline. The plaintiffs’ counsel’s work began on this matter in November, 2013, approximately three and one-half years prior to trial. There were a number of pre-trial conferences. I have reviewed the time spent and the work done and find that it is generally reasonable. The rates charged for lawyers, students and clerks are appropriate. The disbursements incurred were warranted.

[7] I do have concerns with some work billed by MW, an employee of plaintiffs’ counsel’s firm, whose identity and job title I cannot determine. The hourly rate charged for this person suggests that s/he is a legal assistant. There are a number of entries which show a lawyer having a discussion with MW and billing time for it. MW also bills for the same discussion. This is an unwarranted duplication. MW has also billed for scanning documents into the law firm’s system (which is equivalent to filing documents), pulling documents for a meeting, organizing document briefs and trial bag and organizing the file a number of times. While the amounts billed for these various activities is small in comparison to the total fees billed, they should not be included in the amount of a costs order against the defendant.

The Defendant’s Conduct

[8] The trial began on May 16, 2017. Given the second offer, the defendant could have walked away from the matter two weeks before trial without paying anything. All she had to do was allow the reinstatement work to proceed, the cost of which the plaintiff would have covered, and refrain from interfering with the plaintiffs’ use of the right of way, as set out in the registered easement. The plaintiffs would have received no compensation for their damages which included loss of rent. The trial could have been completely avoided. Despite this, the defendant unreasonably persisted in her position that the plaintiffs were not entitled to use the catchbasin for drainage and that they had “overburdened” the easement. Information regarding the plaintiffs’ legal use of the easement and the purpose of the catchbasin was available to the defendant from the solicitor who acted for her on the purchase of the property. His office was located right next door to her property. She never made the inquiry. Instead, she persisted with an incorrect assumption, even after seeing the scope video.

[9] The plaintiffs had two counsel at trial, Mr. Gionet, who had carriage of the matter, and Mr. Valler who was co-counsel. The plaintiffs correctly note that the legal issues were not complex. Ordinarily, co-counsel would not have been required. A number of photos and videos were entered as exhibits. The defendant in particular relied on many videos which were played in court. These were taken by her partner, Mr. Clifford, who is not a lawyer and was the defendant’s only witness. According to his evidence, the defendant does not know how to turn on a computer or use one. The defendant’s numerous videos were introduced through Mr. Clifford’s testimony. Mr. Valler was exceptionally helpful to the defendant in operating the electronics for her. He located and played her videos through the courtroom technology. Without his assistance, the trial would have taken much longer. The defendant would have required someone else to assist her.

[10] According to the plaintiffs’ counsel’s dockets, Mr. Valler spent approximately 16 hours during the trial, outside of court time, assisting Mr. Gionet with preparation. Approximately half of this time was not billed to the client as a courtesy. Mr. Valler attended the trial with Mr. Gionet; however, none of his time for this is documented.

[11] The plaintiffs state that these are unusual circumstances. A fee for co-counsel is warranted. Mr. Valler did provide considerable assistance to the defendant during the trial; however, this was offered voluntarily. The defendant would not have reasonably expected to pay costs relating to Mr. Valler’s assistance in the event that she was unsuccessful. Accordingly, the plaintiffs’ request for a co-counsel fee is denied.

Proportionality

[12] The plaintiffs request $111,671.55 for fees including HST as well as $18,731.77 for disbursements. As noted above, the amount awarded was $100,000 pursuant to the Simplified Procedure rule. This included the cost to reinstate the catchbasin as well as part of the rental income loss. More importantly, the plaintiffs obtained three declarations. One prevented the defendant from interfering with or otherwise impeding the plaintiffs’ and their tenants’ reasonable use of the right of way which included access to their building. Another authorized the plaintiffs to proceed with the remedial catchbasin work in the laneway, without the defendant’s consent, in accordance with the design and specifications of the plaintiffs’ engineer. Without these declarations, the plaintiffs were unable to rent part of their building. Water would have continued to accumulate in the laneway and behind the plaintiffs’ building, creating unsafe walking and parking areas for the plaintiffs and their tenants.

[13] Setting aside, for the moment, the amount awarded for damages, and considering only the declarations, I find that the amount requested for costs is proportionate to the declarations ordered. Considering the defendant’s refusal to accept the second offer, the plaintiffs’ only option for rectifying the drainage situation so that they could fully use their property was to proceed to trial.

Conclusion

[14] In exercising my discretion as set out in s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C43 to fix costs, and in taking into account the factors set out in Rule 57.01 and the overriding principles of fairness and reasonableness as set out in Boucher v. Public Accountants 2004 CanLII 14579 (ON CA), 71 O.R. (3d) 291, I find that a fair, reasonable and proportionate costs award for this action is $128,000, all inclusive, which the defendant shall pay to the plaintiffs forthwith.

M.E. VALLEE

Released: September 28, 2017