COURT FILE NO.: CV-13-0321-000 AND CV-12-1306-0000
DATE: 20180405
ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN:
Friday Harbour Resort Inc. Plaintiff
– and –
2138746 Ontario Inc Defendant
David Outerbridge, Alex Shelley, Jeffery Shankman, for the Plaintiff Patrick Flaherty and Brendan Brammall, for the Defendant
AND BETWEEN:
2138746 Ontario Inc Appellant
– and –
Kimvar Enterprises Inc Respondent
Patrick Flaherty and Brendan Brammall, for the Appellant David Outerbridge, Alex Shelley, Jeffery Shankman, for the Respondent
AND BETWEEN:
Friday Harbour Village Inc. Plaintiff
– and –
2138746 Ontario Inc. Defendant
David Outerbridge, Alex Shelley, Jeffery Shankman, for the Plaintiff Patrick Flaherty and Brendan Brammall, for the Defendant
AND BETWEEN:
2138746 Ontario Inc. Appellant
– and –
Friday Harbour Village Inc. Respondent
Patrick Flaherty and Brendan Brammall, for the Appellant David Outerbridge, Alex Shelley, Jeffery Shankman, for the Respondent
M. P. EBERHARD
COSTS DECISION
[1] After a seven day trial in November 2017, I released reasons for judgment.
[2] The parties appeared today to speak to costs. 2138746 Ontario Inc. (hereinafter referred to as its principal Mr. Adler or the Defendant) is represented by new counsel.
[3] Friday Harbour Village Inc. (formerly KIMVAR hereinafter referred to as Friday Harbour or the Plaintiff) also sought to address a remedy they had claimed about which there was no explicit finding and further asked that I fix the terms of the judgment to issue.
Claim for Declaration
[4] I noted in my reasons that the Plaintiff had made the following claim:
Gate Encroachment:
(c) a declaration that the north gate post of Mr. Adler’s stone and iron gate, on Block C at the Lot 4/5 boundary, is located upon and is an unlawful encroachment upon Friday Harbour’s lands;
[5] The Rules of Practice allow me to consider an accidental slip or omission.
59.06 (1) An order that contains an error arising from an accidental slip or omission or requires amendment in any particular on which the court did not adjudicate may be amended on a motion in the proceeding. R.R.O. 1990, Reg. 194, r. 59.06 (1).
Setting Aside or Varying
(2) A party who seeks to,
(a) have an order set aside or varied on the ground of fraud or of facts arising or discovered after it was made;
(b) suspend the operation of an order;
(c) carry an order into operation; or
(d) obtain other relief than that originally awarded,
may make a motion in the proceeding for the relief claimed. R.R.O. 1990, Reg. 194, r. 59.06 (2).
[6] The Defendant asserts that I did make a decision about this stone and iron gate by referring to the issues in paragraphs 102-105 of my reasons:
[102] Friday Harbour is not currently seeking an order for impediments to be removed but seeks a declaration which would require Mr. Adler, on request to remove impediments including both the barriers forming the dead end at the top of the boundary between lots 2 and 3 and also Mr. Adler’s recently constructed security gate which is partly on the Western strip. Friday Harbour seeks a declaration that use would be limited only by by-laws and government regulation which may or may not take into account my findings about 1936 contemplations. [emphasis added]
[103] Despite the demonstrated efforts of good will and consideration by Friday Harbour for lot 3 to 6 neighbours in this litigation and in the design of Friday Harbour Village Inc., leaving to its unfettered discretion the option to demand such removals invites future dispute.
[104] I find that Friday Harbour cannot take the position that impediments at the top of the boundary between lots 2 and 3 can be removed at its demand. Friday Harbour’s claim to adverse possession succeeded because of the completeness and long duration of the barrier between the Marina strip and the Western strip. It relied on the enclosure it provided as an important component of the legal test for adverse possession. Its claim to the Marina strip was not based on reliance on its right of way. It was based on acts of possession that were "open, notorious, peaceful, adverse, exclusive, actual and continuous”. The Plaintiff extracted a concession from the Defendant’s expert that the use of the Marina strip by the Marina was “an assumption of the appearance of ownership”.
[105] Having relied on the barriers, I find that Friday Harbour cannot now demand their removal. Practically speaking that means that any continuing right of way over the Western strip could not provide ingress or egress to lots 1 and 2.
[7] I found that Friday Harbour could not demand removal of these several barriers. However, I did not address the claim seeking a declaration that the stone and iron gate is located on Friday Harbour land.
[8] All the evidence, including evidence provided by the Defendant, shows that the pillar of the new security gate erected by Mr. Adler encroaches on the Friday Harbour land on the north side of the western strip by .29 meters north of property line. This was not disputed in argument.
[9] I simply omitted to make the declaration that the post encroaches .29 meters onto the Friday Harbour land. I do so now.
Settling the Order
[10] The parties file alternate proposals for the terms of the order.
[11] Firstly, I add the term relating to the declaration just made and with the consent of Plaintiff counsel I remove unnecessary words as provocative without purpose in the circumstances.
[12] More significantly I accept the Plaintiff’s submission that the order should describe the subject matter of the litigation in descriptions that are registerable in the Land Titles system. The Defendant submitted that the entered order should use the wording of my reasons where I referred to the disputed property as “the marina strip” and “the western strip”.
[13] For parties to litigation there comes to be a short form manner of expression about the subjects repeatedly discussed in a trial. Everyone present and directly interested knows what is being discussed. To maintain that language in the formal judgment however, invites further litigation by failing to name the subject matter so that the judgment can be understood by others. Specifically, it could in this case require a further application for Land Titles registration which could be objected to on the basis that the formal description did not match the subject found by trial.
[14] In my reasons I relied on the litigants to sensibly convert my words into the formal description of the lands to which they apply. There are numerous surveys created for the trial with a series of descriptors for the subject strips of land. The Plaintiff has now created a survey with descriptions responsive to the trial judgment with an eye to registration requirements.
[15] It is conceded that the proposed survey may have a variation by 1/100th of a meter. My choice is whether to give the Defendant time to confirm the survey with his experts or fix the survey into my formal judgment for subsequent review if it is found to be in error. I choose the latter approach in the interests of finality. If no error is asserted, the judgment will be fully in place to be reviewed or enforced.
[16] The Plaintiff has no objection to registration in Land Titles Absolute (as claimed) and not Land Titles Absolute Plus (as proposed in draft).
[17] The form of Judgment appended to these reasons constitutes my findings as to the form of Judgment that is to be issued and entered.
Costs
[18] Friday Harbour is seeking costs of $530,516.51. The quantum itself for a trial of seven days invites scrutiny.
[19] The Defendant’s third argument against that claim for costs is that the quantum is too high and submits that for fees each party should merit $250,000 which would be set off against each other in circumstances of mixed success. The Defendant takes no issue with the Plaintiff’s claim for disbursements of $91,771.21. I observe therefore that the submission that the Plaintiff’s quantum is simply too high recognizes that fees in this case were significant. The Defendant’s $250,000 is the comparator to the Plaintiff’s claim for fees of $388,270.17 and does not recognize the effect of an offer on the scale of indemnity.
[20] The parties agree that hourly rates for elite Toronto litigation firms have been recognized as higher than legal fees in other millieux. Fairfirld Sentry Limited et al v PriceWaterhouseCoopers LLP et al, 2015 ONSC 4961. There is no one arguing that the enhanced rates should not be respected. They agree that 60% of such rates is appropriate for partial indemnity costs.
[21] I have no resistance to enhanced rates in the present case. Counsel on both sides presented superb cases: marshalling the evidence, supporting legal argument, conducting themselves with grace, civility and measured perspective. There were plenty of admissions. Everyone was timely and prepared. Aides to the court were sophisticated and useful. In short it was litigation conducted at its finest, by counsel on both sides. Both sides proceeded in this excellence of skill and methodology such that one side could not now be heard to complain that the extravagance was beyond what a litigant should have expected.
[22] I am fixing costs, not assessing them. Several factors were argued to be excessive in the Plaintiff’s costs:
(a) Both sides had comparable senior counsel and juniors performing similar roles in the courtroom, but in addition the Plaintiff had another senior counsel with specialized conveyancing experience and history in the case. The Plaintiffs reduced his fees by ½ in the costs claimed.
(b) Plaintiff counsel rates should be less, commensurate with Defendant counsel rates.
[23] I do take those arguments into account in assessing the costs claim as a whole. It is impossible to be precise about such factors.
[24] The Defendant’s principle costs argument is that there was mixed success. I was referred to my reasons for judgment wherein I listed the claim and counterclaims and the issues raised on the appeal from The Deputy Director. I did so for the structure of my reasons. Counsel then purported to score the success in the trial issue by issue raised in those claims.
[25] Overall, the Plaintiff succeeded in establishing adverse possession to the marina strip. The Defendant succeeded in having the right of way to the western strip declared abandoned. That gives the appearance of mixed success.
[26] I find emphatically that the Plaintiff won this trial.
[27] What the Plaintiff failed to achieve was the retention of a right of way over the western strip, so the Plaintiff did not enjoy success in every part of its claim. The focus of the trial was the marina strip. The Plaintiff did not concede abandonment of the western strip, but, as it turns out, they had made an offer prior to trial in which they offered to abandon that claim.
[28] Furthermore, the Defendant’s arguments did not deprive the Plaintiff of full success. Rather, it was the Plaintiff’s evidence and law that won it the adverse possession claim that I found as reason why they had effectively abandoned the western strip because it could never be used as a right of way.
[29] The history of the litigation is relevant to my emphatic determination that the Plaintiff won this trial:
[30] As part of its development imperatives and the changeover to Land Titles occurring in this province, Friday Harbour sought to register in Land Titles Absolute. Mr. Adler filed an objection and made extravagant claims that rendered Friday Harbour vulnerable to unspecified interference with plans and costs.
[31] In effect, Mr. Adler poked a stick into the spokes that threatened unpredictable results and halted progress in the legal certainty necessary to the project. Friday Harbour had to respond by litigation.
[32] When Mr. Adler purchased the cottage, the huge commercial development that had long been the marina was notoriously evolving into a huge resort complex. Mr. Adler’s cottage was no wilderness retreat. Although it was never stated during the trial, it is nevertheless understandable as argued in the costs submissions, that a cottager would want to minimize impact of the resort on his enjoyment. I averted to that assumption in my reasons where I borrowed words from the late Trudeau comparing it to living next to an elephant.
[33] The stick was in the spokes and legal certainty was halted but the elephant continued to grow. It is difficult to discern what Mr. Adler hoped to accomplish with his stick, except perhaps leverage, as his purpose was, and remains, unstated.
[34] It was Mr. Adler who chose elite Toronto counsel so the Plaintiff was not unreasonable in doing so thereafter.
[35] Mere enumeration of the legal characterizations that were raised as issues by the parties does not alter the clear focus of the trial on whether Mr. Adler would retain legal title to the marina strip.
[36] Accordingly, I will take into account that the success of the Plaintiff was not complete and the result regarding the western strip may be an important benefit to Mr. Adler, but I do not award costs to the Defendant to be set off against the cost award to the Plaintiff.
[37] Finally on the issue of costs, it was argued that the Plaintiff’s offer was insufficiently clear and certain to say that the Plaintiff beat its offer to attract Rule 49.10.
[38] The Defendant argued that no form of release was appended and that by releasing all other claims it could be referring to claims outside the litigation.
[39] Counsel agreed that the release term is implied if not contained in the offer so the Defendant goes on to assert that because it was expressed in the offer it must have meant other unspecified claims outside the litigation
[40] I reject this reasoning. There is nothing whatever to suggest the release was intended to cover alien claims. There were, as the listed claims for relief demonstrated, plenty of claims and issues other than adverse possession that had to be addressed and the release is the way to do it.
[41] The Defendant further argues that the description of the subject lands in para (b) is unclear. The marina strip was described umpteen different ways in the proceedings before me. This one is as good as any other. They all describe the marina strip and it is disingenuous to suggest that the parties did not know exactly what was being referred to.
[42] And, in para (f) the Plaintiff offered to abandon the right of way over the western strip which is exactly what the Defendant achieved in the trial.
[43] The application of Rule 49:10 is complicated but a successful Plaintiff who beats their offer is entitled to substantial indemnity costs thereafter. In the present case I intend to moderate that slightly to recognize that the Defendant did achieve success at trial in relation to the western strip. But the same result was available without trial and the expense of it. I have already stated I do not intend to award set off costs in relation to that issue.
[44] For these reasons I fix costs at $500,000 payable to the Plaintiff, a figure slightly less than claimed but clearly accepting the merit of the justifications for costs put forward by the Plaintiff.
[45] In closing, I remark again that the counsel involved in this trial, now including new counsel who appeared to argue costs, should be rightly gratified by their advocacy, win or lose, that was in the finest traditions of the profession.
EBERHARD J.
Released: April 5, 2018
ONTARIO SUPERIOR COURT OF JUSTICE
THE HONOURABLE JUSTICE MARGARET EBERHARD FRIDAY, THE 15TH DAY OF DECEMER, 2017
B E T W E E N: Court File No. CV-13-0321
FRIDAY HARBOUR VILLAGE INC. Plaintiff/Defendant by Counterclaim
- And –
2138746 ONTARIO INC. Defendant/Plaintiff by Counterclaim
AND B E T W E E N:
2138746 ONTARIO INC.
- And –
FRIDAY HARBOUR VILLAGE INC. Applicant/Respondent in Appeal
JUDGMENT
THIS ACTION AND TRIAL DE NOVO APPEAL were heard November 22, 23, 24, 28, 29, 30 and December 4, 2017, without a jury, at the courthouse at 3 Dominion Street, Bracebridge, Ontario P1L 2E6, in the prescence of counsel for all parties, with judgment being reserved.
ON READING THE PLEADINGS AND HEARING THE EVIDENCE and on reading and hearing the submissions of counsel for Friday Harbour Village Inc. and 2138746 Ontario Inc., this Court having delivered reasons for judgment dated December 15, 2017.
This court declares that, in action 13-0321, Friday Harbour Village Inc. v. 2138746 Ontario Inc., Friday Harbour Village Inc., by virtue of adverse possession, is the owner in fee simple of the lands currently registered in the name of 2138746 Ontario Inc., as set out in PIN 58085-0366 and being shown as Parts 1 and 2 on Plan 51R-41425 prepared by Rady-Pentek & Edward Surveying Ltd. (attached as Exhibit 1 hereto).
The court orders that the Land Registrar for the Land Titles Division of Simcoe (No. 51) at Barrie amend their records to add the lands currently registered in the name of 2138746 Ontario Inc., as set out in PIN 58085-0366 and being shown as Parts 1 and 2 on Plan 51R-41425 prepared by Rady-Pentek & Edward Surveying Ltd. To the title of Friday Harbour Village Inc. in PIN 58085-0376, to record that ownership interest.
This court orders that the Application , originally made by Kimvar Enterprises Inc., now Friday Harbour Village Inc., pursuant to subsection 46(2) of the Land Titles Act is granted and Friday Harbour Village Inc. shall be registered as the owner as Land Titles Absolute of title to Lots 1 and 2, Plan 1021, Town of Innisfil, together with the lands currently registered in the name of 2138746 Ontario Inc., as set out in PIN 58085-0366 and being shown as Parts 1 and 2 on Plan 51R-41425 prepared by Rady-Pentek & Edward Surveying Ltd.
This court declares that the north gate post of 2138746 Ontario Inc.’s stone and iron gate, on Block C, Plan 1021 at the Lot 4/5 boundary is located upon and is a partial encroachment upon Friday Harbour Village Inc.’s lands.
This court orders that, in action 13-0321, Friday Harbour Village Inc. v. 2138746 Ontario Inc., the counterclaim is dismissed.
This court declares that, in the trial de novo appeal 12-1306, 2138746 Ontario Inc. v. Friday Harbour Village Inc., Friday Harbour Village Inc.’s entitlement to a right of way over the remaining portion of Block C, that is in the portion of Block C to the south and west of Part 2 on Plan 51R-41425 prepared by Rady-Pentek & Edward Surveying Ltd. (attached as Exhibit 1 hereto), in favour of PIN 58085-0376, over PIN 58085-0366, has been abandoned and such right of way has no force and effect.
This court orders that the Land Registrar for the Land Titles Division of Simcoe (No. 51) at Barrie amend their records to delete the existence of the right of way from title to the lands in PIN 58085-0366 over the remaining portion of Block C, that is the portion of Block C to the south and west of Part 2 on Plan 51R-41425 prepared by Rady-Pentek & Edward Surveying Ltd. (attached as Exhibit 1 hereto), in favour of PIN 58085-0376, over PIN 58085-0366.