Court File and Parties
COURT FILE NO.: CV-17-586602
DATE: 20180622
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
ALTERRA-FINER (POST-HOUSE) LTD.
Applicant
– and –
TORONTO STANDARD CONDOMINIUM CORPORATION NO. 2481
Respondent
COUNSEL:
Arnie Herschorn, for the Applicant
Megan Mackey, for the Respondent
HEARD: WRITTEN SUBMISSIONS
Reasons Regarding Costs
G. DOW, J.
[1] The decision in the applications brought by each party against the other was released by me on May 16, 2018. Alterra-Finer (Post-House) Ltd. (“Alterra”) was granted recovery of $79,650.00 of HST it submitted it was owed and Toronto Standard Condominium Corporation No. 2481 (“TSCC 2481”) was granted recovery of $20,597.90 of additional expenses it incurred when refinancing was delayed by the position maintained by Alterra regarding payment of the $79,650.00 (plus the entire amount of the mortgages owed).
[2] Given the divided success of the parties, I tentatively awarded no costs to either party subject to review of written submissions to be provided to me by June 13, 2018 given my awareness of the existence (but not the content) of Rule 49 Offers to Settle. I received the Costs Submissions of Alterra on or about May 24, 2018 detailing the Offers to Settle it made and requesting partial indemnity costs of $5,647.74 for fees including HST to November 29, 2017. In addition, it sought substantial indemnity costs of $28,944.95 for fees inclusive of HST subsequent to November 29, 2017 or a total of $34,592.69.
[3] In fact, Alterra made three Offers to Settle as outlined in its material:
on October 17, 2017, that it would accept $53,040.00 or two thirds of the $79,650.00 plus accrued interest it claimed it was owed;
on November 1, 2017 that it would accept $53,040.00, all inclusive which was open for acceptance until November 15, 2017; and
on November 29, 2017 an offer to accept $39,780.00 or almost 50% of the amount it claimed, all inclusive with discharge of the registered Notices of Vendor Liens.
[4] Each of these offers would appear to have been a better result for TSCC 2481 than my decision which requires them to pay a minimum of $58,962.10 subject to my disposition on costs.
[5] The responding material from counsel for TSCC 2481, received on or about May 31, 2018, did not dispute Alterra’s claim for costs but rather that the amount claimed was excessive. Counsel identified four main factors being:
that the time and amount TSCC 2481 expended in preparing and arguing the application was only $7,409.09 inclusive of fees, HST and disbursements on a partial indemnity basis and thus an appropriate amount;
new counsel for Alterra was appointed in or about February 1, 2018 when a Notice of Change of Solicitors was served which resulted in significant duplication of effort and expense which ought not to be awarded;
the overall objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay (in accordance with Boucher v. Public Accountants Council for the Province of Ontario 2004 CanLII 14579 (ON CA), [2004] O.J. No. 2634 at paragraph 26); and
the motion’s judge should stand back from the fee produced by the raw calculation of hours spent and multiplied by hourly rates claimed and determine the reasonable amount to be paid from the perspective of the losing party (in accordance with Coldmatic Refrigeration of Canada Ltd. v. Leveltec Processing LLC, 2005 CanLII 1042 (ON CA), [2005] O.J. No. 160 at paragraph 8).
[6] I agree with each of the submissions made by counsel for TSCC 2481. However, I would also note it would be inappropriate in these circumstances to ignore the intent of Rule 49.10 not to award costs on a partial indemnity level up to the date of the offer and substantial indemnity costs thereafter. The party that served the Offer to Settle and obtained a better result than its Offer to Settle is entitled to rely on its Offer to Settle in its submissions regarding costs. To do otherwise would discourage (with the benefit of hindsight) parties from making Offers to Settle, particularly an offer which proposes a compromise from the entire amount to be awarded if a matter proceeds. This permits each party to avoid expending additional legal expenses. Further, such Offers to Settle encourage, (again with the benefit of hindsight), parties to seriously review the other side’s Offer to Settle, particularly one that compromises the potential outcome. In my view, most settlements should include compromise from being completely successful or unsuccessful.
[7] As a result, my final order disposing of costs is to award partial indemnity fees including HST of $4,520.00 to November 29, 2017 and substantial indemnity fees including HST of $7,345.00 after November 29, 2017. These amounts, in my view, adequately balance what the unsuccessful party should have expected to pay if unable to obtain a result more favourable than the Offer to Settle it chose not to accept and the impact of Rule 49.10.
[8] The total for fees including HST is $11,865.00. TSCC 2481 shall also pay Alterra’s disbursements of $1,636.01 (which includes HST) for a total of $13,501.01 for costs, inclusive of fees, HST and disbursements.
Mr. Justice G. Dow
Released: June 22, 2018
COURT FILE NO.: CV-17-586602
DATE: 20180622
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
ALTERRA-FINER (POST-HOUSE) LTD.
Applicant
– and –
TORONTO STANDARD CONDOMINIUM CORPORATION NO. 2481
Respondent
REASONS REGARDING COSTS
Mr. Justice G. Dow
Released: June 22, 2018