Frank v. Bolton and Schneider, 2018 ONSC 5593

Court File and Parties

Court File No.: CV-11-430647 Date: 2018-09-24 Superior Court of Justice - Ontario

Re: Catharina Frank aka Catharine Frank and Ivan Frank, Plaintiffs And: Bolton Medical Imaging Centres and K. Schneider, Defendants

Before: Madam Justice Darla A. Wilson

Counsel: John M. Freeman, Counsel, for the Plaintiffs Antonella Albano, Counsel, for the Defendant Bolton Medical Imaging Centre Eli Mogil & Emily M. MacKinnon, Counsel for the Defendant Schneider

Heard: In Writing

Endorsement on Costs

1This medical negligence claim proceeded to trial before me over the course of 5 days. In a Judgment released November 20, 2017, I dismissed the action. I indicated if counsel could not agree on costs, I would receive written submissions. That has been done and I have reviewed the costs submissions of all parties.

2By way of background, the Plaintiffs claimed damages arising from the alleged failure to diagnose breast cancer in the Plaintiff Mrs. Frank in 2008. The Defendant Bolton Medical Imaging Centres (“Bolton”) was the facility where Mrs. Frank had her imaging done. The Defendant K. Schneider (“Dr. Schneider”) was the physician who reported on the imaging. Damages were agreed upon and the trial proceeded on the issue of liability only.

Positions of the Parties

3Bolton asks that an award of costs on a partial indemnity basis be made in the sum of $70,918.50. An offer pursuant to Rule 49 was made on December 18, 2015, which was a dismissal without costs. Counsel submits that the outcome at trial entitles Bolton to its costs. It is noted that at trial, there was no evidence called by the Plaintiffs to establish the standard of care that Bolton had to meet nor was there any evidence that Bolton was negligent in the manner in which the images were taken or in the quality of its imaging.

4The Defendant physician, Dr. Schneider, asks for costs payable on a partial indemnity scale fixed in the sum of $178,849.25. It is submitted that costs follow the event as a general rule and there are no special circumstances that warrant depriving the successful parties of costs in this case. Dr. Schneider submits that the amounts claimed are reasonable, in light of the nature of the case and the other factors set out in Rule 57.01(1).

5The Plaintiffs take the position that there should be no order for costs made in this case. Mr. Freeman argues that the Plaintiffs are elderly, in poor health and they have no assets and no ability to pay a costs award.

Analysis

The Law on Costs in Ontario

6Section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43, provides as follows:

Subject to the provisions of an Act or rules of court, the costs of and incidental to a proceeding or a step in a proceeding are in the discretion of the court, and the court may determine by whom and to what extent costs shall be paid.

7Rule 57.01 of the Rules of Civil Procedure identifies the factors a court may consider when exercising its discretion to award costs:

In exercising its discretion under section 131 of the Courts of Justice Act to award costs, the court may consider, in addition to the result in the proceeding and any offer to settle or to contribute made in writing,

(0.a) the principle of indemnity, including, where applicable, the experience of the lawyer for the party entitled to the costs as well as the rates charged and the hours spent by that lawyer;

(0.b) the amount of costs that an unsuccessful party could reasonably expect to pay in relation to the step in the proceeding for which costs are being fixed;

(a) the amount claimed and the amount recovered in the proceeding;

(b) the apportionment of liability;

(c) the complexity of the proceeding;

(d) the importance of the issues;

(e) the conduct of any party that tended to shorten or to lengthen unnecessarily the duration of the proceeding;

(f) whether any step in the proceeding was,

(i) improper, vexatious or unnecessary, or

(ii) taken through negligence, mistake or excessive caution;

(g) a party’s denial of or refusal to admit anything that should have been admitted;

(h) whether it is appropriate to award any costs or more than one set of costs where a party,

(i) commenced separate proceedings for claims that should have been made in one proceeding, or

(ii) in defending a proceeding separated unnecessarily from another party in the same interest or defended by a different lawyer; and

(i) any other matter relevant to the question of costs.

8Rule 49.10 limits the court’s discretion on costs in certain circumstances when there has been a qualifying offer to settle. Rule 49.13 provides as follows:

Despite rules 49.03, 49.10 and 49.11, the court, in exercising its discretion with respect to costs, may take into account any offer to settle made in writing, the date the offer was made and the terms of the offer.

9Rule 49, with its provision for the imposition of costs if a party fails to obtain an outcome as favourable as an offer to settle delivered prior to the commencement of trial, is designed to encourage parties to accept reasonable offers to settle and avoid the uncertainty and expense of a trial.

10Certain principles have been established that serve as a guide when the court is exercising its discretion when fixing costs.

• The discretion of the court must be exercised in light of the specific facts and circumstances of the case in relation to the factors set out in rule 57.01(1): Coldmatic Refrigeration of Canada Ltd. v. Leveltek Processing LLC.
• The Court of Appeal has identified the overriding principle to be that the amount of costs awarded be reasonable in the circumstances. In Davies v. Clarington (Municipality), 2009 ONCA 722, 100 O.R. (3d) 66 (Ont. C.A.) Epstein J.A. stated at paras. 51-52:

As can be seen, the overriding principle is reasonableness. If the judge fails to consider the reasonableness of the costs award, then the result can be contrary to the fundamental objective of access to justice. Rather than engage in a purely mathematical exercise, the judge awarding costs should reflect on what the court views as a reasonable amount that should be paid by the unsuccessful party rather than any exact measure of the actual costs of the successful litigant. In Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291, [2004] O.J. No. 2634 (C.A.), this court emphasized the importance of fixing costs in an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding at para. 37, where Armstrong J.A. said “[t]he failure to refer, in assessing costs, to the overriding principle of reasonableness, can produce a result that is contrary to the fundamental objective of access to justice.

11The Courts of Justice Act gives the court a wide discretion concerning the award of costs, the quantum of costs and the parties that must pay a costs order. Rule 57.01 provides the court with guidance about the various factors that may be considered when exercising its discretion.

12Generally, in civil proceedings in Ontario, the rule of thumb is that costs follow the event unless there is a persuasive reason that they should not. Cumming J. in DUCA Financial Services Credit Union Ltd. v. Bozzo, 2010 ONSC 4601, at para. 5, described the “normative approach” to an application for costs:

Costs are in the discretion of the Court: s. 131, Courts of Justice Act, R.S.O. 1990, c. C.43 and Rule 57.01 of the Rules of Civil Procedure. In Ontario, the normative approach is first, that costs follow the event, premised upon a two-way, or loser pay, costs approach; second, that costs are awarded on a partial indemnity basis; and third, that costs are payable forthwith, i.e. within 30 days. Discretion can, of course, be exercised in exceptional circumstances to depart from any one or more of these norms. [Emphasis added].

13In 394 Lakeshore Oakville Holdings Inc. v. Misek, 2010 ONSC 7238, at para. 10, Perell J. noted at para. 12:

In the exercise of the court’s discretion, the most general rule is that costs at a partial indemnity scale follow the event, which is to say that normally costs are ordered to be paid by the unsuccessful party to the successful party on a partial indemnity scale: Bell Canada v. Olympia & York Developments Ltd. (1994), 17 O.R. (3d) 135 (Ont. C.A.); St. Jean (Litigation Guardian of) v. Cheung, 2009 ONCA 9, [2009] O.J. No. 27 at para. 4 (C.A.).

In Yelda v. Vu, 2013 ONSC 5903, the court stated, at para. 11:

The default rule, however, in resolving costs issues is that the successful party is entitled to its costs. The principle that costs follow the event should only be departed from for very good reasons such as misconduct of the party, miscarriage in procedure, or oppressive or vexatious conduct of proceedings.

14In the instant case, neither Defendant made an offer of compensation to the Plaintiffs; this is presumably because counsel felt the Plaintiffs could not prove on the evidence that there was a breach of the standard of care. The Plaintiffs were aware well in advance of trial that the Defendants would not be making offers to settle that included financial compensation.

15With respect to Bolton as I noted in my Reasons for Judgment, “The Plaintiff did not call any evidence at trial that established the standard of care for an imaging clinic; nor did the Plaintiff put forth evidence to demonstrate that Bolton was negligent in the manner in which the various images were taken or in the quality of its imaging. Four radiologists testified at trial and all of them agreed the mammograms done in 2008 were diagnostic.” In short, there was absolutely no evidence at trial that could establish negligence on the part of the Defendant Bolton; even the Plaintiffs’s own expert Dr Curpen did not offer the opinion that the imaging was in any way substandard. In the absence of evidence to support the allegations that Bolton was somehow negligent, the claim ought to have been dismissed against Bolton prior to trial; the Plaintiffs should have accepted the offer to dismiss without costs well before the trial commenced.

16With respect to the Defendant physician, the case was not as clear cut because much turned on how the experts performed at trial. Ultimately, I was not persuaded by the expert that the Plaintiffs had proven Dr. Schneider breached the standard of care and the case was dismissed against him.

17The Plaintiffs submit that there ought to be no order as to costs. In order to make such a finding, I would have to be persuaded that this is an “exceptional” cases as described in the case law. In my view, there are no unusual circumstances in this case that would justify a departure from the usual approach to the award of costs. I do not perceive the imposition of costs on the unsuccessful Plaintiffs ignores the principle of access to justice. Hardship is not one of the factors specifically set out in Rule 57.01 that the court may consider when exercising its discretion on costs.

18This was not a frivolous action; the Plaintiffs knew that neither Defendant would make an offer of any money to settle the case because both Defendants denied negligence. The Plaintiffs chose to pursue the action through trial, which was their right. However, they must have been advised by their counsel that in the event they were unsuccessful at trial, adverse costs consequences would flow. Unfortunately for the Plaintiffs, that is what transpired. While the Court has discretion with respect to the imposition of costs, the general rule that costs follow the event should only be rejected in unusual cases and in my opinion, this case does not fall into such a category. The successful Defendants are entitled to their costs on a partial indemnity scale.

19I turn now to the quantum of costs. It is my objective to fix an amount that is fair and reasonable, considering the factors set out in Rule 57.01. It must be a sum that the Plaintiffs as the unsuccessful party could reasonably expect to pay after a trial: see Zesta Engineering Ltd. v. Cloutier (2002), 21 C.C.E.L. (3d) 161 (Ont. C.A.). Medical negligence cases generally tend to be complex but the instant case was fairly simple and straightforward. There was no issue of causation to be determined. At trial, the issues were focussed and encompassed only 5 days of trial time. I accept that the issues were of importance to all of the parties; Mrs. Frank felt that she had not received proper medical treatment and for the Defendants, their professional reputations were at issue, which was a matter of concern to them.

20I have reviewed the Bills of Costs submitted by counsel. For the Defendant Bolton, the hourly rates are reasonable on a partial indemnity scale. I find the hours for preparation for the pretrial conference excessive. Similarly, I do not think both Mr. Lin and Ms. Albano needed to spend approximately 40 hours of preparation time each for the trial. The disbursements are reasonable. In my view, fees of $50,000 inclusive of HST plus the disbursements of $16,471.00 are fair and reasonable and I fix them in that amount.

21With respect to the fees claimed by the Defendant Schneider, it is important to note that this Defendant took the lead at trial. Mr. Mogil was assisted at the trial by Ms. MacKinnon, which was reasonable. The hourly rates are fair but some of the hours are excessive, in my view, particularly when compared to the time spent by counsel for Bolton. For example, the examination for discovery took place on one day. Bolton claimed 26 hours in total for this step while counsel for Dr. Schneider claimed 72 hours of time. Similarly, for the pretrial conference, 5 lawyers docketed time totalling 35 hours for Dr. Schneider while Bolton had 23 hours of time for Ms. Albano. Mr. Mogil and Ms. MacKinnon have 200 hours of preparation time for trial while Ms. Albano and Mr. Lin claim 80 hours.

22I am not conducting an assessment; rather, I am attempting to arrive at a figure that is fair and reasonable which the unsuccessful party could expect to pay. In my view, taking into account the facts of this case as well as the factors enumerated in rule 57.07, I am of the view that a fee of $100,000 inclusive of HST is appropriate and I fix the fees of the Defendant Dr. Schneider in that amount. The disbursements of $17,812.24 are proper and I accept them.

Order

23The Plaintiffs shall pay to Bolton fees of $50,000 plus disbursements of $16,471.00 and to Dr. Schneider fees of $100,000 plus disbursements of $17,812.24 forthwith.

D.A. Wilson J.