Court File and Parties
Court File No.: CV-17-508799 Date: 2018/10/10 Ontario Superior Court of Justice
Between: Raymond James Ltd., Plaintiff – and – Jayanth P. Noronha (also known as Jay Noronha), Defendant
Counsel: Gavin J. Tighe and Scott K. Gfeller, for the Plaintiff Evan L. Tingley, for the Defendant
Heard: In writing
Perell, J.
Reasons for Decision - Costs
[1] Jayanth Noronha was an investment adviser. He was a sales agent of Raymond James Ltd. (“RJL”) under an Agency Agreement. The agency relationship ended, and RJL sued Mr. Noronha for repayment of a forgivable loan of which the outstanding balance was $298,783.62. Mr. Noronha counterclaimed for $2.0 million for wrongful termination and breach of a duty of good faith. RJL moved for a summary judgment dismissing the counterclaim and for a judgment of $298,783.62 plus prejudgment interest as provided for in the Agency Agreement.
[2] I granted RJL’s summary judgment motion, [1] and it requests costs of $93,403.10 on a full indemnity basis, $83,594.70 on a substantial indemnity basis, or $57,560.07 on a partial indemnity basis.
[3] In seeking costs on a full or substantial indemnity basis, RJL relies on an indemnification and save harmless clause in the Agency Agreement between the parties and on the circumstance that in pursuit of his defence and his $2.0 million counterclaim, Mr. Noronha made very serious allegations of bad faith that called into question RJL’s integrity and disparaged its reputation. These allegations were unsubstantiated and unproven and Mr. Noronha’s conduct delayed and prolonged what was essentially a debt collection action.
[4] Notwithstanding Mr. Noronho’s argument that the reciprocal indemnification provisions in the Agency Agreement were too vague to support a claim for a full indemnification, RJL’s claim for a full indemnity is fully supported by paragraph 2.16 of the Agency Agreement, which states:
Indemnification by Agent. The Agent agrees to indemnify and hold harmless the Dealer, its successors and assigns, and their respective affiliates, shareholders, directors, officers, employees, suppliers, successors and assigns (collectively, the "Indemnified Parties") from and against all claims, costs, expenses and other liabilities arising directly or indirectly from, or as a result of, or in connection with any breach by the Agent of any provision of this Agreement, any negligence or wilful misconduct in the performance by the Agent of this Agreement, or any breach or alleged breach of contract, duty of care, fiduciary duty or statutory or other obligation or other liability that results in any Claim or in any proceedings by any Regulator, and from any and all actual and consequential damages, costs and expenses (including, without limitation, accounting and legal fees) incurred by any of the Indemnified Parties in defending against them, except to the extent such Claims, costs, expenses or liabilities will have been finally determined by a court to have been directly caused by the negligence of one or more of the Indemnified Parties. The Agent's obligations of indemnification hereunder will survive indefinitely any termination of this Agreement. Notwithstanding the foregoing, the Agent's obligations of indemnification hereunder will not affect the rights of clients of the Dealer to pursue recovery from either the Agent or the Dealer for acts or omissions by the Agent in connection with the carrying on of its business under this Agreement.
[5] RJL’s claim for a full or substantial indemnity is also supported by the case law that holds that full or substantial indemnity costs may be awarded when a litigant makes unfounded and unproven allegations of dishonest or disreputable conduct.
[6] I, therefore, shall grant costs on a full indemnity basis.
[7] I agree with Mr. Noronho’s submission that costs on whatever scale must still be reasonable and fair and appropriate in all the circumstances of the case. However, I disagree with his submission that the costs claim in the immediate case is excessive or disproportionate.
[8] Having regard to the claim and the counterclaim, the amount in issue in the immediate case was $2.3 million. The litigation was prolonged by Mr. Noronho’s conduct, and he was the unsuccessful party; and in all the circumstances, the costs as requested are fair, reasonable and should have been within Mr. Noronho’s reasonable expectations.
[9] Accordingly, I award RJL costs of $93,403.10 – all inclusive.
Perell, J. Released: October 10, 2018