Court File and Parties
COURT FILE NO.: CV-12-469042 DATE: 20180910 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: SARBJIT SINGH, Plaintiff/Defendant by Counterclaim AND: DONALD JOHN TRUMP SR., TRUMP TORONTO HOTEL MANAGEMENT CORP., TRUMP MARKS TORONTO LP, TALON INTERNATIONAL INC., TALON INTERNATIONAL DEVELOPMENT INC., VAL LEVITAN, ALEX SHNAIDER AND TORONTO STANDARD CONDOMINIUM CORPORATION NO 2267, Defendants/Plaintiff by Counterclaim
BEFORE: Cavanagh J.
COUNSEL: Mitchell Wine, for Plaintiff Sarbjit Singh and for Se Na Lee (Plaintiff in CV-15-522065) and Bharat Shah and Suresh Patel (Defendants and Plaintiffs by Counterclaim in CV-14-505147) Brian N. Radnoff, for the Defendant Val Levitan Clifford Lax and Paul Fruitman, for the Defendants Donald John Trump Sr., Trump Toronto Hotel Management Corp., and Trump Marks Toronto LP. Nancy Tourgis and Symon Zucker, for Defendants Talon International Inc., Talon International Development Inc., Alex Shnaider and Toronto Standard Condominium Corporation No. 2267
HEARD: By Written Submissions
COSTS ENDORSEMENT
[1] On July 31, 2018, I released my decision on a motion brought by Sarbit Singh and Se Na Lee, each a plaintiff in one of twenty separate but related actions, and by Bharat Shah and Suresh Patel, defendants and plaintiffs by counterclaim in a third related action. The moving parties were purchasers of units in the former hotel portion (the “Trump Hotel”) of the former Trump International Hotel and Tower Toronto (the “Trump Tower”).
[2] On their motion, the moving parties sought (i) an order consolidating nineteen of the actions into two consolidated actions, (ii) an order requiring one of the defendants, Talon International Inc. (“Talon”), to pay the amount that it owes pursuant to costs orders that were made against it in the Singh action and in the Lee action, failing which Talon’s statement of defence and counterclaim in the two consolidated actions would be struck out, and (iii) an order for security for costs against Talon in the proposed consolidated Singh action and in the Shah/Patel action.
[3] I dismissed the motion to consolidate the actions. I made an order that if Talon fails to pay the costs awards within 10 days of the release of my decision, its statement of defence and counterclaim in each of the Singh action and the Lee action is struck out. I made a security for costs order against Talon in the Shah/Patel action, and dismissed the other motions for security for costs.
[4] This is my decision with respect to the costs of this motion.
[5] The responding parties take the following positions with respect to costs:
a. Talon does not seek costs of the motion on the basis that although it was successful with respect to the relief sought on consolidation, it was not successful on the remaining relief granted. b. Mr. Shnaider seeks costs of the motion for an order for consolidation on a partial indemnity scale in the amount of $6,500. c. Mr. Levitan seeks costs of the motion for an order for consolidation on a substantial indemnity scale because it served a Rule 49 offer on February 2, 2018 offering to agree to an order to have the actions heard together. The amount sought on a substantial indemnity scale is $7,402.90. Alternatively, Mr. Levitan seeks costs on a partial indemnity scale in the amount of $5,060.97. d. The Trump parties seek costs of the motion for an order for consolidation on a partial indemnity scale in the amount of $15,845.49 comprised of fees of $14,014.72 and disbursements of $1,830.77.
[6] The plaintiffs and moving parties submit that no order as to costs should be made in this unusual case. In support of this submission, they submit:
a. The motion was first brought in November 2017 and was initially returnable on January 29, 2018 (where the relief was limited to a request for consolidation). The defendants were represented by the same counsel. The motion was not heard on that date, and it was adjourned on three occasions before it was heard before me. The moving parties opposed the requests for adjournments. b. After the motion was first brought, Mr. Levitan retained separate counsel on January 24, 2018. If the motion had been heard when it was initially returnable with the same result, the moving parties would have been exposed to costs for two sets of counsel, and the costs of counsel for Mr. Levitan would likely have been minimal. c. The motion was adjourned to March 14, 2018 and, on that date, it was adjourned at the request of the Trump parties over the strong objections of the moving parties. Had the motion been heard on March 14, the moving parties would not have been exposed to costs that resulted from separate representation for the Trump parties. d. Given these circumstances, if costs are awarded, the court should exercise discretion and limit the costs to one set of counsel (plus a small amount for counsel for Mr. Levitan). e. Because the motion was adjourned three times through no fault of the moving parties, the court should take the fact that counsel needed to prepare several times into account in fixing the amount of costs to be paid. f. The motion was brought because Talon had failed to pay costs orders that were made against it, and the moving parties were justified in asking for an order for consolidation under rule 6.01(1)(c). Because Talon’s “improper actions” were the reason for the motion, if costs are awarded in favour of the other responding parties, Talon should be ordered to bear the costs consequences and pay these costs. g. No amount of costs should be awarded to Mr. Shnaider who is represented by counsel who also represent Talon. This would result in an attempt to indirectly obtain an order of costs in favour of Talon, the party that was affected by the motion.
[7] Modern costs rules are designed to advance five purposes in the administration of justice: (1) to indemnify successful litigants for the costs of litigation, although not necessarily completely; (2) to facilitate access to justice, including access for impecunious litigants; (3) to discourage frivolous claims and defences; (4) to discourage and sanction inappropriate behaviour by litigants in their conduct of the proceeding; and (5) to encourage settlements: Fehr v. Sun Life Assurance Company of Canada, 2017 ONSC 2218 at para. 34 and authorities cited in that case.
[8] Rule 57.01(1) of the Rules of Civil Procedure provides that in exercising its discretion under section 131 of the Courts of Justice Act to award costs, the court may consider a number of specified factors. Rule 57.01(3) provides that when the court awards costs, it shall fix them in accordance with subrule (1) and the Tariffs.
[9] In Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 728, the Court of Appeal, at para. 26, wrote that the express language of rule 57.01(3) of the Rules of Civil Procedure makes it clear that the fixing of costs is not simply a mechanical exercise and that, overall, the objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding, rather than an amount fixed by the actual costs incurred by the successful litigant.
[10] Talon does not seek costs from the moving parties, and the moving parties do not seek costs against Talon. This is appropriate given the outcome of the motion.
[11] Mr. Shnaider seeks costs of successfully opposing the motion for consolidation. Mr. Shnaider was represented by the same counsel as Talon, and all of the submissions that were made on behalf of Talon would have been made whether or not Mr. Shnaider was also a defendant. In the circumstances, in my view, there were no additional costs that were incurred in respect of the motion to address Mr. Shnaider’s position, as opposed to Talon’s position, and I exercise my discretion not to award costs in his favour.
[12] I do not agree with the submission of the moving parties that costs should be ordered as if the motion was heard on January 29 or March 14, and not July 26, and that costs should be limited to costs for one set of counsel. Mr. Levitan and the Trump parties were separately represented at the hearing of the motion, and they were successful in opposing the motion for a consolidation order. I do not agree that I should infer from the submissions made at the hearing of the motion that the true intent of Mr. Levitan and the Trump parties was to assist Talon to avoid payment of costs orders against it. I draw no such inference.
[13] In my view, Mr. Levitan and the Trump parties are entitled to costs of the motion.
[14] Mr. Levitan seeks costs on a substantial indemnity scale because it offered to consent to a different order than a consolidation order. The motion for a consolidation order was dismissed, and no other order was made. I do not agree that the offer to settle is one that should trigger an order for costs on a substantial indemnity scale. I decline to order costs on this scale. Mr. Levitan was successful in opposing the motion for consolidation, and is entitled to costs on a partial indemnity scale.
[15] I have reviewed the costs outline submitted by Mr. Levitan, and I accept that the time expended was reasonable in the circumstances given that (i) the nature of the relief sought that would affect Mr. Levitan’s interests, and (ii) the delays in the hearing of this motion that were not caused by any conduct of the moving parties. I fix fees in the amount of $4,145 which, together with HST, amounts to $4,683.85. I allow the disbursements claimed of $377.12.
[16] I fix costs to be paid by the moving parties to Mr. Levitan, inclusive of fees, disbursements and HST, in the amount of $5,060.97.
[17] The Trump parties seek costs on a partial indemnity scale in the amount of $15,845.49 including fees of $14,014.72 and disbursements of $1,830.77. The Trump parties submit that considerable costs were incurred documenting differences in the statements of claim, and that this work assisted the court in dismissing the motion. The Trump parties also submit that they provided assistance to the court in relation to the law on consolidation.
[18] I have reviewed the costs outline of the Trump parties. In my view, having regard to the principles in Boucher, the fees claimed are significantly higher than the amount that, in my view, would be fair and reasonable for the unsuccessful moving parties to pay for this motion. I do not question that counsel diligently identified the differences in the statements of claim. An award of fees in the amount of $6,000 would take this contribution into account and would be fair and reasonable for this motion. This amount, with HST, is $6,780. I allow the disbursements claimed of $1,830.77.
[19] I fix costs to be paid by the moving parties to the Trump parties, inclusive of fees, disbursements and HST, in the amount of $8,610.77.