Sanaee v. Grad, 2017 ONSC 7595

CITATION: Sanaee v. Grad, 2017 ONSC 7595

NEWMARKET COURT FILE NO.: CV-16-125199-00

DATE: 20171219

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Baha-Al Deen Sanaee, also known as Dean Sanaee, Plaintiff

AND:

Herman Grad, Jeff Handelsman, Patrick Regina, Markham Suites Hotel Limited, Mark Charlebois, Matthew Robinson-Vincent, York Regional Police Services Board and Eric Jolliffe in his capacity as Chief of Police for the York Regional Police Services, Defendants

BEFORE: THE HON. MR. JUSTICE G.M. MULLIGAN

COUNSEL: H.S. Dorsey, Counsel for the Plaintiff

R. Macklin and M.F. Cooper, Counsel for the Defendants

HEARD: In Writing

costs ENDORSEMENT

[1] Herman Grad, Jeff Handelsman, Patrick Regina, Markham Suites Hotel Limited (hereinafter referred to as the “Grad Defendants”), brought a motion for partial summary judgment seeking to have the claims against them dismissed. For Reasons issued October 26, 2017, the motion brought by these Defendants was dismissed. Both parties were invited to make submissions as to costs. Those submissions have now been received.

Position of the Plaintiff

[2] The Plaintiff was successful in resisting this partial summary judgment motion and submits that costs should follow the event. In addition, he submits that this is a case where he is entitled to substantial indemnity costs, in part, based on a Rule 49 Offer.

Position of the Grad Defendants

[3] The Grad Defendants submit that this is not one of those cases where costs should follow the event. If costs are ordered, they should be reduced as sought by the Plaintiff and the costs should be payable in the cause or in any event of the cause.

Costs Sought by the Plaintiff

[4] The Plaintiff as the successful party seeks costs on a partial indemnity basis for part of the proceedings and on a substantial indemnity basis for the remainder, for a total amount sought of $54,201.00, including disbursements and HST. Alternatively, the Plaintiff seeks partial indemnity cost of $38,745.46.

[5] It is clear that both parties expended considerable resources to prepare and argue this motion which extended over one and a half days. Affidavits were filed and both parties prepared Factums and Books of Authority in support of their positions. In rendering a decision not to grant the relief sought, I made reference to the guiding principles of the Supreme Court of Canada in Hryniak v. Maudlin, 2014 SCC 7, 2014 1 S.C.R. 87 at para. 60:

If some of the claims against some of the parties will proceed to trial in any event, it may not be in the interest of justice to use the new fact finding powers to grant summary judgment against a single defendant. Such partial summary judgment may run the risk of duplicate proceedings or inconsistent findings of fact and therefore the use of the powers may not in the interest of justice.

[6] However, in my decision, I sounded a note of caution with respect to the conduct of the Plaintiff. The essence of my concern with respect of the conduct of the Plaintiff is captured in paragraph 27(f):

I do not want to lose sight of the wire transfers which were tendered to the Grad Defendants [by the Plaintiff] during their prior negotiations as proof of some payments towards the draperies. As events unfolded during the course of this litigation, it became plain and obvious that those wire transfers were never acted upon. Simply put, the funds shown on the wire transfers were never sent to the recipients.

Offer to Settle

[7] The Plaintiff made an offer to settle prior to the hearing of this motion. As a result of that offer not being accepted, the Plaintiff seeks costs on an elevated basis for part of its costs. Costs consequences of failure to accept offers to settle are set out in paragraph 49.10(1) of the Rules of Civil Procedure:

49.10(1) Plaintiff’s offer – Where an offer to settle,

(a) is made by a plaintiff at least seven days before the commencement of the hearing;

(b) is not withdrawn and does not expire before the commencement of the hearing; and

(c) is not accepted by the defendant,

And the plaintiff obtains a judgment as favourable as or more favourable than the terms of the offer to settle, the plaintiff is entitled to partial indemnity costs to the date the offer to settle was served and substantial indemnity costs from that date, unless the court orders otherwise. [emphasis added]

Analysis

[8] It is well settled that section 131 of the Courts of Justice Act, R.S.O. 1990 c. C.43 provides considerable judicial discretion on the issue of fixing costs. Rule 57.01 of the Rules of Civil Procedure sets out various factors that the Court can consider in exercising this discretion, including: the principle of indemnity, the amount of costs an unsuccessful party would expect to pay, the complexity of the proceeding and the importance of the issues. Those principles were highlighted in the Ontario Court of Appeal decision of Boucher v. Public Accountants Council for the Province of Ontario, 2004 CanLII 14579 (ON CA), [2004] O.J. No. 2634. At paragraph 26, Armstrong J.A. stated:

In particular, this rule makes it clear that the fixing of costs does not begin and end with the calibration of hours times rates. The introduction of a cost grid was not meant to produce that result, but rather to signal that is one factor in the assessment of process, together with the other factors in Rule 57.07. Overall, as the court has said, the objective is to fix an amount that is fair and reasonable for an unsuccessful party to pay in a particular proceeding rather than an amount fixed by the actual costs incurred by the successful litigant.

[9] In determining the expectation of the parties, it is always helpful to the court if the losing party shows what his costs were with respect to the same matter: Word Price v. Mariner’s Haven Inc., 2004 O.J. No. 5528 at para. 13. In this case, the Grad Defendants did not set out what their costs were with respect to this proceeding.

[10] In my view, this is not a case where the Plaintiff is entitled to costs on an elevated scale. I have already noted his conduct about the misuse of the purported wire transfer. I therefore decline to exercise my discretion to award costs on an elevated scale.

[11] The Grad Defendants suggest in the alternative, that if costs are awarded on a partial indemnity basis, the amount should be reduced by $12,700, based on reductions suggested for excessive law clerk fees and preparation time. Such a reduction would suggest partial indemnity fees in the range of $26,000, all inclusive.

Costs in the Cause or, in the alternative, in any Event of the Cause

[12] The Grad Defendants further submit that if costs are awarded, they should be payable in the cause, or in the alternative, in any event of the cause.

Conclusion

[13] I am satisfied that the Plaintiff, the successful party on this motion, is entitled to costs on a partial indemnity basis. Having considered the principles of proportionality and reasonableness, I am satisfied that the costs award of $30,000.00 is appropriate in these circumstances. However, in my view, this is an appropriate case where costs should be payable to the Plaintiff in any event of the cause. As Paul Perell and John Morden note in The Law of Civil Procedure in Ontario, (3d) (Toronto: Lexis Nexis, 2017) at page 934:

10.134 An order of “costs to [named party] in any event of the cause” means that the named party is entitled to his or her costs of the step in the proceeding regardless of the ultimate costs order made in the proceedings but these costs are payable at the conclusion of the proceedings. If the party awarded costs in any event of the cause must later pay costs to his or her opponent, the costs award may be set off one against the other.

The Result

[14] Costs are payable to the Plaintiff in any event of the cause, fixed in the amount of $30,000.00.

MULLIGAN J.

Date: December 19, 2017