CITATION: Inzola v. Brampton (City of), 2017 ONSC 6528
COURT FILE NO.: CV-15-2775-00A1
DATE: 2017 10 31
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: INZOLA MAIN STREET INC., Plaintiff
AND: THE CORPORATION OF THE CITY OF BRAMPTON, DOMINUS/CITYZEN BRAMPTON SWQRP INC. and FENGATE (BRAMPTON) LP, Defendants
AND: THEAKSTON ENVIRONMENT CONTROL INC. cob as THEAKSTON ENVIRONMENT CONSULTING ENGINEERS, Third Party
BEFORE: EMERY J.
COUNSEL: Stuart Svonkin, for the Plaintiff Mark MacDonald, for the Defendants (Moving Party) No one appearing for the Third Party
HEARD: July 19, 2017
COSTS ENDORSEMENT
[1] The plaintiff Inzola Main Street Inc. ("Inzola") successfully opposed the motion for summary judgment brought by the defendants to dismiss the action. Inzola now seeks its costs on a substantial indemnity basis in the amount of $100,049.50, inclusive of disbursements and HST, for the time and expense incurred on the motion.
[2] In the alternative, Inzola seeks costs on a partial indemnity basis for a total of $67,757.21.
[3] The defendants oppose the claim for costs advanced by Inzola on both scale and quantum. The defendants submit that the facts of this case do not justify an award of costs on a substantial indemnity scale, and put forth the position that the amounts claimed under either level are "extremely excessive".
[4] Each of these issues will be examined in turn.
Substantial v. Partial Indemnity Costs
[5] The defendants do not dispute that Inzola is entitled to its costs for the motion.
[6] Inzola relies upon two rules to support its claim for those costs on a substantial indemnity basis. First, Inzola served an offer to settle on June 8, 2017, in which it offered to settle the defendants' motion for summary judgment to have the motion dismissed and that the defendants would pay 80% of the plaintiff's costs of that motion on a partial indemnity basis. Accordingly, Inzola relies upon Rule 49 and Rule 57.01(1) as it refers to "any offer to settle" made in writing, as well as the factors set out in that subrule.
[7] The motion was argued on July 19, 2017. It is difficult to determine from the Costs Outline served as an attachment to Inzola's submissions what actual services its counsel provided for 19.6 hours between the date of service of the offer to settle and the date the motion was heard. The recital of all legal services are grouped together as one block description, with times allocated for each counsel who has worked on the file.
[8] The plaintiff's offer to accept 80% of it's costs on a partial indemnity basis on a consent dismissal of the motion was an attractive incentive, and a compromise on its part. In my view, this takes Inzola part way there to having costs awarded at a substantial indemnity level.
[9] I am next asked to determine if costs should be awarded on a substantial indemnity basis under Rule 20.06 because Inzola argues the defendant acted unreasonably by bringing the motion. Rule 20.06 reads as follows:
COSTS SANCTIONS FOR IMPROPER USE OF RULE
20.06 The court may fix and order payment of the costs of a motion for summary judgment by a party on a substantial indemnity basis if,
(a) the party acted unreasonably by making or responding to the motion; or
(b) the party acted in bad faith for the purpose of delay. O. Reg. 438/08, s. 14.
[10] The defendants argue that Rule 20.06 should not apply because it acted reasonably in all of the circumstances when it brought the motion. The City refers to the evidence, including the letters written by Mr. Cutruzzola to the City of Brampton with respect to the snow load issue on June 18, 2012 and with respect to the complaints of nuisance on July 11, 2012, to support its argument that it was reasonable to bring the motion to have the action dismissed with respect to those claims under the Limitations Act, 2002.
[11] In Ashim v. Zia, 2015 ONSC 564, I set out various factors to evaluate unreasonable conduct within the meaning of Rule 20.06(a):
- the evidence on the motion was clearly insufficient to show facts on which the court could conclude that there was no genuine issue requiring a trial;
- the legal basis for the motion was wrong or clearly insufficient for the court to conclude that there was no genuine issue requiring a trial;
- the evidence and legal principles when applied to the issues on the motion did not engage the economies that Hryniak contemplated as a proportionate, timely and affordable procedure to justify bringing the motion having regard to the nature of the action or prevailing circumstances in the litigation; or
- no meaningful order is made by the court under Rule 20.05 to assist with the trial management process for the action or that part of the action for which the motion for summary judgment was refused.
[12] Having regard to these factors, I conclude that Inzola is entitled to costs on a substantial indemnity basis under Rule 26.06(a) for the services its counsel provided before the date the offer to settle was served. My reasons for this conclusion are as follows:
a. The defendants acted unreasonably in bringing the motion because no act or omission had taken place by June 16, 2013 for which Inzola could seek a remedy for the snow loading claim. There was therefore no factual basis to seek dismissal of this claim for being statute barred;
b. The principles set out in Roberts v. Portage La Prairie (City), 1971 CanLII 128 (SCC), [1971] S.C.J. No. 53 are well known that a claim for nuisance does not arise until damage occurs. Further, Roberts stands as authority for nuisance to be considered as a continuing cause of action in certain circumstances. The legal basis to bring the motion to have the claim dismissed on a limitation period defence was clearly insufficient; and
c. I found on Hryniak principles that the motion had been brought for strategic reasons. This supports the conclusion that the defendants acted unreasonably by bringing the motion.
[13] Inzola is therefore entitled to its costs on a substantial indemnity basis throughout.
Quantum of Costs
[14] There are three matters that are, or should not be in dispute with respect to quantum:
- Inzola was put to the significant expense of opposing the defendants' motion for summary judgment. It was important for Inzola to defeat the motion because the intended effect of the motion was to drive Inzola from the judgment seat;
- Costs for examinations for discovery and other steps in the action that did not take place within the scope or timeframe of the motion for summary judgment should be saved for costs of the action, and should not form part of the costs on the motion; and
- The decision of Justice Daley in Inzola Group Ltd. v. Brampton (City of) [2017] O.J. No. 3325 involved litigation between a corporation related to Inzola in which Mr. Svonkin was one of the counsel and the City of Brampton was a defendant. Justice Daley gave his decision on costs in the context of a summary judgment motion that had been brought and then abandoned by the City. Justice Daley found in that case that Mr. Svonkin's hourly billing rate of $625 per hour as one of the counsel for the plaintiff was appropriate given the nature and complexity of the case, the amount at stake, as well as the seniority and experience of the lawyers involved.
[15] Based on Justice Daley's findings, I consider Mr. Svonkin's effective rate of $625 an hour claimed on this motion to be reasonable and appropriate given the nature and complexity of the action and the amount at stake. I also find that the City on this motion could have expected Inzola to be seeking costs based on Mr. Svonkin's hourly rate in the instant case.
[16] The defendants argue that the total amount claimed for costs at this level is excessive. To make that argument is to misapprehend the risk the motion presented to the plaintiff as the responding party, and the responsibility to marshall evidence and law to successfully oppose summary judgment. As Justice Daley astutely observed in Inzola Group v. Brampton:
[46] It is often the case that there is no symmetry whatsoever between the costs of bringing a motion and the costs of responding to one. That is particularly the case on a summary judgment motion, where the responding party is required to put its best case forward, and this typically involves the assembling of substantial evidence in order to defeat the motion. That is certainly the situation in this case.
[47] Furthermore, the risks to be considered by the moving and the responding party are at different ends of the spectrum of risk. As such, it should be reasonably expected by a defendant moving to dismiss an action by a summary judgment motion that the costs and disbursements to be incurred by the responding plaintiff will necessarily be significant having regard to the prospect of the action being summarily dismissed. The moving defendant's risk is limited to liability for costs of the motion if it fails.
[17] The issue taken is with the time claimed and the fees calculated on that time. The defendants speak of difficulty with deciphering the allocation of time taken by counsel because the plaintiff has "lumped all steps" together for preparation and for attendances on the motion. Further, the defendants take issue with the time recorded for cross-examinations. They report that the first examination of Stephen Pollack lasted 36 minutes, and that the second cross-examination of John Cutruzzola concluded 44 minutes after it started. These examinations were separate and distinct from the five days of examinations for discovery in the action itself, which should not be included in the assessment of costs here.
[18] The defendants take no issue with the disbursements listed in the plaintiff's costs.
[19] In my view, the amount of time claimed by the plaintiff's counsel is moderately excessive from the standpoint of what would be fair and reasonable for the defendants to pay. I therefore reduce the amount claimed on a substantial indemnity basis by 20% to fees of $68,585, plus HST of $8,916. To this I add $3,172.62 for disbursements, inclusive of HST.
[20] Accordingly, Inzola Main Street Inc. is awarded costs for successfully opposing the defendants' motion for summary judgment, fixed in the amount of $80,673.62. These costs are payable by the City of Brampton and the other defendants on a joint and several basis within 30 days.
Emery J
DATE: October 31, 2017
CITATION: Inzola v. Brampton (City of), 2017 ONSC 6528
COURT FILE NO.: CV-15-2775-00A1
DATE: 2017 10 31
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: INZOLA MAIN STREET INC. Plaintiff
- and -
THE CORPORATION OF THE CITY OF BRAMPTON, DOMINUS/ CITYZEN BRAMPTON SWQRP INC. and FENGATE (BRAMPTON) LP Defendants
- and -
THEAKSTON ENVIRONMENT CONTROL INC. cob as THEAKSTON ENVIRONMENT CONSULTING ENGINEERS Third Party
BEFORE: EMERY J.
COUNSEL: Stuart Svonkin, for the Plaintiff Mark MacDonald, for the Defendants (Moving Party) No one appearing for the Third Party
COSTS ENDORSEMENT
EMERY J.
DATE: October 31, 2017