COURT FILE NO.: 2931-13-SR
DATE: 20180406
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
DORIS HAMELIN and JOSEPH HACHEY
Plaintiffs
– and –
LEON M. MOUSSEAU, SHELDON MOUSSEAU and STEPHEN ROBERTS
Defendants
Dhiren R. Chohan, for the Plaintiffs
Spencer D.W. Ball, for the Defendants
HEARD: In writing
DECISION on costs
wilcox, j.
[1] The decision in this matter invited written costs submissions within given timelines. The defendants filed theirs. Nothing has been received on behalf of the plaintiffs.
[2] The defendants’ Bill of Costs included substantial indemnity fees of $36,039.68, plus HST of $4,685.16 and disbursements of $2,197.16 inclusive of HST where applicable, for a total of fees, disbursements and HST of $42,922.00.
[3] S. 131 of the Courts of Justice Act leaves the costs of a proceeding to the discretion of the court. Rule 1.04(1) requires the court to make orders and give directions that are proportionate to the importance and complexity of the issues and to the amount involved in the proceeding. Rule 57 of the Rules of Civil Procedure sets out the factors to be considered by the court, in addition to the result in the proceeding and any offer to settle, in exercising this discretion.
[4] “Modern costs rules are designed to foster three fundamental purposes:
To indemnify successful litigants for the cost of litigation;
To encourage settlements; and
To discourage and sanction inappropriate behaviour by litigants.”[^1]
[5] “The costs award should reflect more what the court views as a fair and reasonable amount that should be paid by the unsuccessful parties rather than any exact measure of the actual costs to the successful litigant.”[^2]
[6] This case involved the characterisation and interpretation of an arrangement between the plaintiff, Joseph Hachey, and the defendant, Leon Mousseau, regarding a piece of land owned by the latter. Joseph Hachey contended that there was an agreement for him to buy the property which agreement is not fully contained in a written document. Leon Mousseau contended that there was a lease agreement with an option to purchase which was not exercised. In the alternative, the plaintiffs based a claim for damages on unjust enrichment. The plaintiffs’ claims were dismissed after a trial.
[7] As the successful parties, the defendants are presumptively entitled to their costs in this matter on a partial indemnity basis.
[8] However, the defendants made an offer to settle dated September 5, 2017. It provided for a consent to the dismissal of the action and the payment by the plaintiffs to the defendants of the sum of $7,500.00 inclusive of fees, disbursements and HST. It was open until after the commencement of the hearing. Obviously, the offer was not accepted. The defendants obtained a judgment as favourable as the offer. So, the defendants shall have partial indemnity costs to Sept 5, 2017 and substantial indemnity costs thereafter.
[9] The defendants calculated their partial indemnity fees for the litigation up to the Offer to Settle to be $7,323.77, and their substantial indemnity fees for the period following the Offer to Settle to be $25,054.20, for a sub-total of $32,377.97 plus HST of $4,209.14, resulting in total legal fees of $36,587.11.
[10] In addition, the defendants seek their disbursements, as set out in the Bill of Costs, in the sum of $2197.16, inclusive of HST.
[11] The total amount sought by the defendants as costs is therefore $38,784.27.
[12] I now turn to the relevant Rule 57.01 factors.
[13] Dealing with the principal of indemnity, the defendants’ Bill of Costs sets out the experience of the lawyers, their hourly rates and the hours involved, all of which appeared to be within reason.
[14] As for the amount of costs that an unsuccessful party could reasonably expect to pay, I can only assume that the plaintiffs’ counsel would have informed them of the risk of having to pay costs, and the approximate quantum thereof.
[15] The claim was for ownership of the defendant’s property, being about 48 acres of rural land. There was no appraisal of it, but the parties’ 2002 agreement contained an option to buy for $90,000.00. There were two rental residences on the property, each of which was worth several hundred dollars per month as income properties.
[16] The plaintiffs’ alternative claim was for damages of $100,000.00 on a quantum meruit basis. Clearly, the property had a substantial value even though there was no formal valuation of it.
[17] The value of the property made the issue of its ownership an important one to the parties. In addition, it could be argued that the property had an intangible value to the defendants due to their long family history there.
[18] There was moderate complexity to the proceedings. The interpretation of the parties’ agreement involved arguments about the Statute of Frauds, the use of surrounding circumstances in the interpretation, and the parole evidence rule. Trial took three days, plus written submissions.
[19] Having taken into account the relevant factors enumerated under Rule 57 as well as the application of the principle of proportionality (Rule 1.04(1.1)) and the principles set forth in the case law, I conclude that an award of costs in the amount of $35,000.00 inclusive of fees, disbursements and HST would be a reasonable one in the circumstances, and I order the Plaintiffs to pay that amount to the defendants within 30 days.
Justice J. A. S. Wilcox
Released: April 6, 2018
COURT FILE NO.: 2931-13-SR
DATE: 20180406
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
DORIS HAMELIN and JOSEPH HACHEY
Plaintiffs
– and –
LEON M. MOUSSEAU, SHELDON MOUSSEAU and STEPHEN ROBERTS
Defendants
DECISION ON COSTS
J. WILCOX
Released: April 6, 2018
[^1]: Fong v. Chan, 46 O.R. (3rd) 330 [^2]: Boucher v. Public Accountant’s Counsel (Ontario), [2004] O.J. No. 2634