COURT FILE NO.: 4393/11 DATE: 2018/12/28 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: DAVID SMITH and SAMANTHA SMITH, plaintiffs AND: J.H. GALLANT LIMITED, CANADIAN TIRE CORPORATION, LIMITED REXON INDUSTRIAL CORP., REXON INDUSTRIAL CORP., LTD. And POWER TOOL SPECIALISTS, INC., defendants

BEFORE: Justice I.F. Leach

COUNSEL: Louis J. Crowley, for the plaintiffs Teri MacDonald, for the defendants

HEARD: By written submissions

Endorsement - Costs

Background

[1] On August 27, 2018, I released my substantive decision – since reported as Smith v. J.H. Gallant Ltd., [2018] O.J. No. 4417 (S.C.J.) – dealing with the lingering aspects of:

a. a motion brought by the defendants, seeking relief including various orders compelling the plaintiff Mr Smith to attend a number of independent medical examinations and other assessments, satisfy undertakings, answer refusals, and attend a continued or further oral discovery examination; and

b. a cross-motion brought by the plaintiffs, seeking relief including orders compelling the defendants to serve a sworn affidavit of documents, satisfy undertakings, and provide further details of efforts made to obtain information that might no longer be available.

[2] In particular, (and as indicated in my earlier decision), when the motions came before me at a special appointment hearing, I was advised by counsel that the parties had been able to reach an agreement on many of the issues raised by the motions; an agreement that was implemented by the making of an interim order made on consent.

[3] The remaining issues in dispute focused on:

i. whether the plaintiff Mr Smith should be ordered to attend a defence vocational assessment, as requested by the defendants;

ii. whether the plaintiff Mr Smith should be ordered to attend a continued and/or further oral discovery examination, as requested by the defendants; and

iii. the manner in which costs of the motions should be addressed and resolved.

[4] I received oral submissions from counsel in relation to the first two matters before reserving my decision on those issues, on the understanding that the parties then would be permitted to address the outstanding cost issues by way of written submissions, once my substantive decision on the other two remaining issues had been released.

[5] For the reasons set forth in my aforesaid substantive decision, I made orders that included the following:

a. Mr Smith was required to attend the vocational assessment contemplated by the defendants, subject to the specified conditions as to venue and duration;

b. Mr Smith was required to attend a further oral discovery examination permitting the defendants to explore, in detail, the alleged causal connection between initial and subsequent hand injuries, and corresponding loss; [1] and

c. if the parties were unable to agree on cost resolutions acceptable to all concerned, in relation to entitlement and/or quantum, written cost submissions were to be submitted according to specified timetable.

[6] The parties thereafter apparently were unable to agree on costs.

[7] Primary written cost submissions, (with attachments including the plaintiff’s bill of costs, and letters sent by defence counsel to the plaintiff’s lawyers prior to argument of the motions), were delivered by the defendants on or about September 7, 2018.

[8] Responding written cost submissions, (without any attachments), were delivered by the plaintiffs on or about September 24, 2018.

[9] The plaintiff then delivered reply written cost submissions, (including a number of reported decisions addressing costs), on or about September 28, 2018.

[10] Other pressing demands of my docket unfortunately have prevented me from rendering a cost decision before now.

Party positions

[11] Through their written submissions, the defendants formally request an order requiring the plaintiff to pay:

• fees on a substantial indemnity basis totalling $31,265.75, inclusive of HST;
• in the alternative, fees on a partial indemnity basis totalling $20,816.13, inclusive of HST; and
• in any event, disbursements totalling $1,999.99, inclusive of HST.

[12] The defendants also ask that any fixed award of costs be made payable within 30 days, as per the ordinary practice contemplated by Rule 57.03(1)(a) of the Rules of Civil Procedure.

[13] Through their written submissions, the plaintiffs submit, inter alia, that the amount sought is “grossly excessive and unsupported”, that the costs claimed should be completely or “virtually” offset by the costs incurred by the plaintiffs in bringing their cross-motion, and that, in any event, costs awarded to the defendants in relation to the motions should not exceed the all-inclusive amount of $3,500.

[14] Based on what essentially are claims of impecuniosity, (having particular regard to Mr Smith’s current lack of income, which the plaintiffs attribute to the failings and breached duties of the defendants alleged by the plaintiffs in this litigation), the plaintiffs also ask for an order delaying the payment of any such cost obligations of the plaintiffs to the conclusion of the case, at which time the costs are to be offset against the plaintiffs’ recovery, (if any), or made enforceable in favour of the defendants, (in the event of no recovery by the plaintiffs).

General principles

[15] Pursuant to section 131 of the Courts of Justice Act, R.S.O. 1990, c.C.43, as amended, and 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 the costs shall be paid”.

[16] This is supplemented by the provisions of Rule 57.01, subsection (1) of which lists a broad range of factors the court may consider when exercising its discretion to award costs pursuant to section 131.

[17] Our courts repeatedly have emphasized that cost awards must not be a simple mechanical or mathematical calculation; e.g., focused merely on details of time spent multiplied by hourly rates, or a tabulation of disbursements actually incurred.

[18] Rather, all cost claims are subject to the “overriding principle of reasonableness”, as applied to the factual matrix of the case, pursuant to the ultimate “cross check” required by such authorities as Boucher, Moon and Coldmatic Refrigeration of Canada Ltd. v. Leveltek Processing LLC (2005), 75 O.R. (3d) 638 (C.A.), and Anderson v. St Jude Medical Inc. (2006), 264 D.L.R. (4th) 557 (Ont.Div.Ct.).

[19] The overall goal is to award costs in an amount that is “fair and reasonable for the unsuccessful party to pay in a particular proceeding”, rather than a sum tailored to an exact measure of the actual costs of a successful litigant. See Boucher v. Public Accountants Council for the Province of Ontario, [2004] O.J. No. 2634 (C.A.), at paragraph 26, and Zesta Engineering Ltd. v. Cloutier, [2002] O.J. no. 4495 (C.A.), at paragraph 4.

Entitlement

[20] Questions of cost entitlement in this particular instance are complicated somewhat by the broader context in which I am asked to resolve the motion-related cost issues presented for formal resolution. In particular:

• There appears to be no dispute that the defendants were largely successful and the plaintiffs were not, as far as argued issues were concerned. (As noted in my substantive decision, plaintiff counsel had argued that Mr Smith should not be required to attend for the vocational assessment sought by the defendants, and similarly opposed any further oral discovery examination of Mr Smith.) Barring some kind of complete “offset” in motion-related cost entitlements, (i.e., a notional cost entitlement owed by the defendants to the plaintiffs in relation to the plaintiffs’ otherwise-settled motion, that equals or exceeds costs which the plaintiffs might otherwise owe to the defendants in relation to the defendants’ motion), costs normally should “follow the event”, with the successful defendants being entitled to a measure of cost reimbursement in relation to their motion. [2]
• As noted above, the argued issues nevertheless were not the only ones in dispute when the parties brought their respective motions, and therefore not the only issues towards which litigation costs were expended.
• In their material, the defendants have not indicated, (e.g., by the provision of more specific docket entries), the manner in which particular costs were allocated to particular tasks or issues – including any attribution of costs to matters which were and were not settled. There is simply an indication of the total hours directed towards the motions by each lawyer and student involved in the matter, and broad descriptions of the various tasks that were undertaken by the group as a whole; e.g., preparation for and attendance at the motion, communications with plaintiff counsel and legal research, as well as the scheduling and cancellation of appointments with defence experts. This makes it difficult if not impossible to assess objectively, and with precision, whether or not time devoted to particular tasks was excessive, reasonable or perhaps over-lawyered.
• For their part, the plaintiffs provided no information whatsoever as to the particular time, fees and/or disbursements devoted to motion-related matters, or details as to which lawyers or paralegals may have been involved and at what cost. For obvious reasons, this effectively makes it impossible to assess objectively, or with any precision, the merits of the sweeping but essentially bald assertion that “the costs of the defendants’ motions should be completely offset or virtually offset by the plaintiffs’ motion”. As discussed in more detail below -- in relation to consideration of the plaintiffs’ reasonable cost expectations, referred to in Rule 57.01(0.b) -- the plaintiffs’ failure to provide any details whatsoever of their own fees and disbursements also effectively makes it impossible to assess objectively or accept the similarly bald assertion that the plaintiff Mr Smith was not “at any time aware that his exposure [to adverse costs] would be remotely what is now being sought” by the defendants.
• For reasons similar to those I outlined in Witherspoon v. Witherspoon, [2015] O.J. No. 5406 (S.C.J.), (albeit in the family law context), courts asked to deal with the costs of settled issues also are deprived of significant benchmarks usually employed to arrive at fair and just cost awards. In particular, without argument and objective determinations as to whether parties were right to raise certain issues, oppose certain requests or delay agreement to certain issues, and the extent to which agreed outcomes reached by way of settlement accord with what a court would have decided, courts inherently embark on a degree of speculation when called upon to assess what corresponding cost outcomes may or may not be reasonable in the circumstances.
• In such circumstances, precise assessment of the various factors outlined in Rule 57.01, (to which I will return in more itemized fashion below), effectively is frustrated in many ways, and emphasis on the “overriding principle of reasonableness” and overall goal of awarding costs that are “fair and reasonable for the unsuccessful party to pay in a particular proceeding”, noted above, take on added importance.

[21] Bearing in mind such practical limitations, but having regard to all the material filed in relation to the motions, (including those issues which were resolved by settlement), on balance I think the defendants are entitled to a measure of costs in relation to their motion.

[22] In saying that, I am mindful of the reality that, while bringing a motion to enforce discovery obligations of the plaintiffs, the defendants apparently were in breach of their own obligations in that regard; e.g., insofar as they failed to provide any sworn affidavit of documents prior to their motion being argued, (contrary to the provisions of Rule 30.03), and some of their own undertakings apparently were outstanding.

[23] However, it also seems to me that, to the extent the plaintiffs had any serious concerns in that regard, the appropriate independent response would have been a prompt motion by the plaintiffs to compel compliance with the defendants’ obligations. The reality of plaintiff counsel having raised such issues only belatedly, in response to initiatives taken by the defendants to secure Mr Smith’s attendance at defence examinations, and by way of a cross-motion not even contemplated by the timetable established for hearing of the defendants’ motion by way of a special appointment hearing, strongly suggests that the discovery issues raised by the plaintiffs were not a priority but somewhat of an afterthought, raised as a shield rather than a matter of pressing importance. [3]

[24] On balance, I think the issues raised by the defendants in their motion were more numerous and significant than the issues raised by the plaintiff in their cross-motion, and that the relief obtained by the defendants through belated plaintiff consent and formal court orders outweighed that obtained by the plaintiffs through defence consent.

[25] There will, in the circumstances be a net award of costs to the defendants.

Scale

[26] As noted above, the defendants ask that they be awarded costs on a substantial indemnity basis.

[27] In that regard, although the court has a broad discretion in relation to costs, our appellate courts repeatedly have emphasized that awards of costs on a partial indemnity basis generally strike the proper balance cost benefits to be enjoyed by a “winner” and cost burdens to be borne by the “loser”, and that elevated cost awards should be reserved for “rare and most exceptional” cases where the conduct of a litigant warrants condemnation. See, for example, Foulis v. Robinson (1978), 21 O.R. (2d) 179 (C.A.), and Isaacs v. MHG International Ltd., (1984), 45 O.R. (2d) 693 (C.A.).

[28] In their written cost submissions, the defendants repeatedly emphasize, in various ways, that the plaintiffs acted unreasonably. In that regard, particular reliance was placed on the failure of the plaintiffs and/or their counsel to address requests for Mr Smith’s attendance with defence experts in a timely way, and/or a corresponding failure to formally concede, in a timely way, that the defendants’ requests in that regard were fair and reasonable in the circumstances. Those failures were in turn said to have significantly delayed the litigation, (e.g., insofar as set pretrial and trial dates had to be vacated), while generating considerable inconvenience and costs that otherwise could have been avoided.

[29] However, mere failure to agree or settle, and adherence to unsuccessful positions in litigation, are not by and of themselves grounds for awarding costs on a substantial indemnity basis. As our Court of Appeal emphasized in Foulis v. Robinson, supra, a litigant is entitled to put an opponent to the proof of his or her requested relief, and there is no obligation to settle.

[30] The sort of conduct meriting elevated cost awards has been described in various ways.

[31] In Young v. Young, [1993] 4 S.C.R. 3, at p.134, McLachlin J., (as she then was), indicated that elevated cost awards are warranted “only where there has been reprehensible, scandalous or outrageous conduct on the part of one of the parties”.

[32] In Mortimer v. Cameron (1994), 17 O.R. (3d) 1 (C.A.), and McBride Metal Fabricating Corp. v. H&W Sales Co. (2002), 59 O.R. (3d) 97, whose principles were echoed and emphasized again by our Court of Appeal in Davies v. Clarington, 2009 ONCA 722, [2009] O.J. No. 4236 (C.A.), conduct warranting elevated cost awards was described as “reprehensible”, “egregious”, or “acts that clearly indicated an abuse of process”, justifying enhanced costs as a form of chastisement.

[33] In this particular case, I think plaintiff counsel certainly should have responded more quickly and directly to defence counsel’s requests for co-operation with Mr Smith attending, as requested, with various defence experts.

[34] In that regard, I do not look favourably on plaintiff counsel’s explanation that Mr Smith’s attendance with some defence experts always was contemplated, but that plaintiff counsel first “required some reciprocation from the defendants in complying with their obligations”. An opponent’s failure to comply with rules and obligations warrants the bringing of a motion to address the failure. It does not create a licence to ignore one’s own independent obligations in the litigation.

[35] In the particular circumstances of this case, I think such considerations certainly are relevant to the exercise of my cost decision, having regard to Rule 57.01(1)(e) and Rule 57.01(1)(f) of the Rules of Civil Procedure; i.e., respectively dealing with conduct that tended to lengthen unnecessarily the duration of the proceeding, and conduct that was, inter alia, unnecessary.

[36] However, I am not persuaded that the relevant conduct in this particular case involves the sort of “rare” and “most exceptional” reprehensible and egregious behaviour warranting an award of costs on a substantial indemnity basis, having regard to the above authorities.

[37] Nor was I presented with evidence of any relevant settlement offers that independently might have justified awarding costs on an elevated scale.

[38] Costs accordingly will be awarded to the defendants on a partial indemnity basis.

Quantification

[39] In arriving at a global determination of a cost award that is “fair and reasonable” in this particular case, having regard to all the circumstances, my considerations include but are not limited to those outlined below.

AMOUNT CLAIMED AND RECOVERED & APPORTIONMENT OF LIABILITY – RULES 57.01(1)(a) AND 57.01(1)(b)

[40] Rule 57.01(1)(a) permits the court to consider “the amount claimed and the amount recovered in the proceeding”.

[41] The relief sought by the defendants’ motion, and the relief granted, did not involve monetary claims or recovery per se.

[42] Rule 57.01(1)(b) permits the court to consider, in exercising its cost discretion, “the apportionment of liability”.

[43] In this particular case, “liability” per se was not in issue, in terms of the issues I was asked to address and resolve on the motion for partial summary judgment.

[44] However, to the extent Rule 57.01(1)(a) and Rule 57.01(1)(b) essentially focus on the degree to which litigants were successful, I think it fair to say, for the reasons outlined above, that the defendants were almost entirely successful in terms of the relief sought in their motion, and that their success outweighed that of the plaintiffs, (in relation to their cross-motion), in terms of quantum and significance.

[45] Some allowance nevertheless needs to be made for the plaintiffs’ success in having the defendants attend to their own outstanding discovery obligations.

PRINCIPLE OF INDEMNITY, REASONABLE EXPECTATIONS AND PROPORTIONALITY – RULE 57.01(1)(0.a), RULE 57.01(1)(0.b), RULE 1.04(1) AND RULE 1.04(1.1)

[46] I turn next to a number of relevant considerations which, in my view, are particularly interconnected in this case.

[47] In that regard, I begin by noting the provisions of Rule 57.01(0.a) and Rule 57.01(0.b), which respectively permit the court to consider, in exercising its cost discretion:

i. “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”; and

ii. “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”.

[48] As noted above, the defendants tendered, with their written cost submissions, a Bill of Costs. It indicates the lawyers, students-at-law and law clerks who did work in relation to the defendants’ motion, the total number of hours each individual spent on the matter, the years of experience possessed by each lawyer working on the file, and the hourly rates employed, (for each individual who did work relating to the motion), on both a partial and substantial indemnity basis.

[49] The partial and substantial indemnity hourly rates employed by the defendants in formulating their bill of costs were not questioned or challenged by the plaintiffs in their responding cost submissions, and I independently find the suggested rates to be appropriate.

[50] As for the hours devoted to this matter by the indicated lawyers, students and law clerks, the responding cost submissions tendered by the plaintiffs contain no particularized or reasoned complaints about the time devoted to the matter by any particular legal practitioner employed by the defendants. As noted above, there is simply a bald assertions made by plaintiff counsel that the “time and amount claimed to be payable” is “grossly excessive and unsupported”.

[51] Similarly, in relation to the reasonable cost expectations of the plaintiffs, or the parties more generally, there are bald assertions by plaintiff counsel that Mr Smith was not “at any time aware that his exposure [to costs] would be remotely [near to] what is now being sought”, and that “under no circumstances could [the costs now sought by the defendants] be considered as being the reasonable expectations of the parties with respect to the matters in issue”.

[52] However, the plaintiffs failed to tender their own Cost Outline, Bill of Costs, or dockets to indicate the time and expense the plaintiffs themselves may have devoted to “the matters in issue”.

[53] Our courts repeatedly have emphasized that, when one party attacks another’s costs as excessive but declines to make voluntary disclosure of its own corresponding costs, such criticisms are “no more than an attack in the air”. See, for example: Risorto v. State Farm Mutual Automobile Insurance Co., (2003), 64 O.R. (3d) 135 (S.C.J.); Springer v. Aird & Berlis LLP, [2009] O.J. No. 2170 (S.C.J.), at paragraphs 12-17; and Landmark Vehicle Leasing Corp. v. Thethi Holdings Inc., [2010] O.J. No. 2942 (S.C.J.), at paragraphs 40-42.

[54] Having said that, I nevertheless independently have concerns about the hours and associated legal expense underlying the defendants’ claim for reimbursement.

[55] In that regard, I do not doubt that defence counsel devoted the hours indicated to diligent prosecution of the motion on behalf of the defendants.

[56] However, as noted above, our courts repeatedly have emphasized that cost awards must not be a simple mechanical or mathematical calculation; e.g., focused merely on details of time spent multiplied by hourly rates.

[57] In particular, cost indemnification is tempered not only by the overriding principle of reasonableness, but also by the related need for all involved in our justice system to focus on cost control and proportionality, as emphasized by our Rules of Civil Procedure. For example, this is reflected in:

• Rule 1.04(1), the provisions of which include a direction to construe the rules, (and therefore Rule 57.01 as well), in a manner that will promote securing “the least expensive” determination of a civil proceeding on its merits; and
• Rule 1.04(1.1), which obliges the court to apply the rules and make orders, (including those relating to cost awards), in a manner “proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding”.

[58] In saying that, I also am mindful of the general admonition, voiced by Justice Nordheimer (as he then was) in Basedo v. University Health Network, [2002] O.J. No. 597 (S.C.J.), but embraced by our Court of Appeal in Boucher v. Public Accountants Council (Ontario), supra, at paragraph 27, that “it is not the role of the court to second-guess the time spent by counsel unless it is manifestly unreasonable in the sense that the total time spent is clearly excessive or the matter has been overly lawyered”.

[59] In this particular case, I nevertheless have concerns in that regard – bearing in mind that “overly lawyered” can mean not only too many lawyers and too many hours, but also a failure to delegate tasks to more junior and less expensive but sufficiently qualified legal personnel where that might be done appropriately.

[60] As noted above, I was not provided with detailed information as to what each particular individual employed by defence counsel may have done in relation to the defendants’ motion. However, I find it difficult to understand how the nature of this particular motion would have required the extended involvement of a senior partner with 43 years of experience, (14.3 hours), a junior partner with 10 years of experience, (61 hours), a junior associate with 2 years of experience, (19.1 hours), and no less than four students, (with a cumulative total of 26.3 hours), and two law clerks, (with a cumulative total of 14.4 hours).

[61] The defendants certainly were entitled to employ all the particular legal personnel they did to perform such work, and it was done admirably; i.e., with the benefits of that work reflected in the outcome of the defendants’ motion.

[62] Having said that, I question whether the defendant should be expected to pay for having so many legal hands involved in the preparation of a single motion, especially when much of the initial preparation for the motion, (e.g., in terms of legal research and initial drafting, as opposed to initial correspondence with opposing counsel, review and finalization of material, and final preparations for motion attendance and argument), would or could have been performed by a junior associate, with or without the assistance of students.

[63] Similarly, I find it hard to understand how a motion of this nature reasonably could have required, (assuming seven hours of completely uninterrupted working time per day), 2 solid days of work by the senior partner, almost 9 solid days of work by the junior partner, and almost 3 solid days of work by the junior associate; i.e., 14 days of three lawyers successively working, without interruption, on just one motion – before one also considers time spent on the matter by students and law clerks.

[64] In my view, the inescapable conclusion is that there was, at a minimum, duplication of effort and/or disproportionate levels of review and preparation devoted to the matter.

[65] More generally, having regard to the overall principle of reasonableness, in my view the costs sought by the defendants in relation to a motion of this nature are far in excess of those normally awarded for special appointment motions of this nature, in this particular venue.

[66] As for the disbursements claimed by the defendants, they were not questioned or criticized by the plaintiffs, and I independently find them to be reasonable in the circumstances.

COMPLEXITY OF PROCEEDING AND IMPORTANCE OF ISSUES – RULES 57.01(1)(c) AND RULES 57.01(1)(d)

[67] Rules 57.01(1)(c) and 57.01(1)(d) permit the court to consider, in exercising its cost discretion, “the complexity of the proceeding” and “the importance of the issues”.

[68] In relation to the former consideration, I do not think the issues raised by the motions were complex, in terms of the issues raised and the rules and principles applicable to their determination.

[69] As reflected in my substantive decision, the relevant law was not really in dispute. Resolution of the issues raised by the motion instead required, for the most part, a determination of what result should follow based on the particular factual circumstances of this case – although the relevant factual record, (including clarification of the issues raised by the pleadings, the nature of what transpired at Mr Smith’s initial oral discovery examination, and subsequent correspondence confirming the concerns and requests made by counsel), clearly took time to document and present.

[70] As for the importance of the issues raised by the motions, parties obviously must always abide by their disclosure obligations, including provision of a sworn affidavit of documents, fulfilment of undertakings and, where appropriate, revisiting of initially refused information. However, as noted above, those issues were formally raised and pursued by each side somewhat belatedly; e.g., only after pretrial and trial dates had been set. That in turn reflects, I think, how important such issues were to the parties.

[71] In my view, the issues of far greater importance raised by the motions concerned Mr Smith’s attendance for defence examinations/assessments, and the defendants’ request for a further oral discovery examination of Mr Smith to address the causal connection between his first and second hand injuries suggested in the expert report of Dr Richards served by plaintiff counsel.

[72] For the reasons outlined in my substantive decision, I think the concerns raised by the defendants in that regard were not only meritorious but also of great significance to the litigation proceeding in a fair and equitable manner, with all concerned having the benefit of full and proper disclosure to permit proper assessment, trial preparation and/or settlement overtures in relation to this matter.

CONDUCT AND/OR STEPS THAT LENGTHENED PROCEEDING – RULES 57.01(1)(e) AND 57.01(1)(f)

[73] Rule 57.01(1)(e) permits the court to consider, in exercising its cost discretion, “the conduct of any party that tended to shorten or lengthen unnecessarily the duration of the proceeding”.

[74] Rule 57.01(1)(f) permits the court to consider whether any step in the proceeding was “improper, vexatious or unnecessary”, or “taken through negligence, mistake or excessive caution”.

[75] To some extent, these concerns have already been addressed in my earlier comments.

[76] Although plaintiff counsel claimed that the matter was delayed by the defendants’ failure to comply with their discovery obligations, (e.g., insofar as the defendants’ delayed satisfaction of undertakings was said to have “delayed the plaintiffs’ abilities to obtain a liability opinion” and “proceed with the scheduled trial”), the plaintiffs’ failure to formally pursue such concerns, except as a belated response to the defendants’ motion, undermines the suggestion of any such critical importance of the defendants’ undertakings to timely progress of the matter.

[77] On the other hand, the defendants obviously were waiting on receipt of the plaintiffs’ expert reports before being in position to respond with reports from defence experts, and that response was in turn delayed by the plaintiffs’ failure to respond in a timely or reasonable fashion to legitimate requests for co-operation in scheduling appropriate meetings of Mr Smith with those defence experts.

[78] As noted above, that co-operation should not have been figuratively “held to ransom” by plaintiff counsel’s stated desire for reciprocal co-operation in relation to satisfaction of undertakings – especially when delays fostered in relation to expert witnesses were likely to result in far greater delay in progress of the litigation.

[79] In particular, while the satisfaction of most undertakings lies within the control of litigants, the timely preparation of expert reports is quite a different matter.

[80] Experts frequently have very busy schedules, and our courts repeatedly encounter the reality that progress of litigation is delayed, and court schedules are disrupted, by the inability of parties to obtain and serve expert reports in a timely way. The significant resulting complications, (at least in London where this particular litigation is being pursued), recently were discussed at length by Justice Grace in Ismail v. Ismail, [2018] O.J. No. 5639 (S.C.J.).

[81] Given such realities, counsel should co-operate as much as possible to minimize difficulties in scheduling timely appointments with experts, and/or delays in the resulting preparation of proper expert reports. That did not happen in this case, and the result has been considerable delay; e.g., through the vacating of set pretrial and trial dates.

REFUSAL TO MAKE APPROPRIATE ADMISSIONS – RULE 57.01(1)(g)

[82] This was not, in my view, a relevant factor or consideration in the determination of an appropriate cost award in this case. [4]

ANY OTHER MATTER RELEVANT TO COSTS – RULE 57.01(1)(i)

[83] Apart from the considerations outlined above, in my view the parties cited no other matters of significance to determining an appropriate award of costs in this case.

[84] In particular, as noted above, there was no evidence of any relevant settlement offers made, in relation to the motions.

Quantification

[85] It has been said many times, and in many ways, that discretionary cost determinations are far from an exact science.

[86] Again, the overall goal is to award costs in an amount that is fair and reasonable in a particular proceeding – having examined various factors such as those outlined in Rule 57.01.

[87] Having regard to all the circumstances of this particular case, including the various countervailing considerations explored in detail above, and the overriding principle of reasonableness, I think justice will be served if my discretion is exercised so as to award the defendants their net costs of the motions, (i.e., “net” in the sense that my cost award takes both the defendants’ motion and plaintiffs’ cross-motion into account), fixed in the all-inclusive amount of $9,000.00.

Timing

[88] As noted above, the defendants asked that any order of fixed costs made in their favour be made payable within 30 days, in accordance with the usual practice contemplated by Rule 57.03(1)(a).

[89] As also noted above, plaintiff counsel effectively asked that I exercise the discretion, conferred or confirmed by the preamble to Rule 57.03(a), to depart from the contemplated general practice if I am “satisfied that a different order would be more just”.

[90] In particular, plaintiff counsel asked that the plaintiffs’ payment of any cost award to the defendant be delayed until the end of the litigation, at which time the cost obligation could either be set off against the plaintiffs’ recovery, (if any), or become enforceable in favour of the defendants, (in the event of no recovery by the plaintiffs).

[91] The only justification suggested for such a deviation was impecuniosity. In particular, the written submissions tendered by plaintiff counsel include the following assertion:

Mr Smith does not have any source of income and has been unable to work since 2010 because of his disability that is alleged to be the responsibility of the defendants, and is not in a position to pay the excessive sums sought …

[92] Our Court of Appeal has confirmed, in Serra v. Serra, 2009 ONCA 105, [2009] O.J. No. 432 (C.A.), at paragraph 8 that modern cost rules are designed to foster three fundamental purposes:

i. partial indemnification of successful litigants for the cost of litigation;

ii. encouragement of settlement; and

iii. discouraging and sanctioning inappropriate behaviour by litigants.

[93] The authorities also emphasize that, as a rule, impecuniosity generally should not and does not eliminate or reduce a party's liability for costs, as such an approach generally would infuse the entire litigation process with considerable uncertainty, and effectively eliminate an important "reality check" on the manner in which even impoverished litigants pursue litigation. However, if properly established, impecuniosity may be one of the factors a court has the residual ability to consider, in extraordinary cases, in the exercise of its general cost discretion; e.g., to preserve access to justice. See, for example: Agius v. Home Depot Holdings Inc., 2011 ONSC 5272, [2011] O.J. No. 4424 (S.C.J.), at paragraphs 13-18, and the additional cases examined and cited therein. See also Boucher v. Public Accountants Council for the Province of Ontario, et al., supra, at paragraph 37; and Guelph (City) v. Wellington-Dufferin-Guelph, 2011 ONSC 7523, [2011] O.J. No. 6009 (S.C.J.), at paragraph 14.

[94] In the particular circumstances of this case, plaintiff counsel has tendered nothing to substantiate the above assertion of plaintiff impecuniosity.

[95] In my view, it was incumbent on plaintiff counsel to do so if seeking a departure from the general outcome contemplated by Rule 57.03(1)(a). The policy goals underlying cost awards otherwise would be too easily circumvented and undermined.

[96] Moreover, this is a case where the defendants actively dispute the plaintiffs’ claim of impecuniosity; e.g., asserting that, while Mr Smith currently may not be working, Mrs Smith is still actively employed as a production manager, the couple lives in a house they have occupied for over 20 years, and they continue to operate two motor vehicles. [5]

[97] Furthermore, I note that plaintiff counsel’s assertion of impecuniosity related to the much larger cost awards sought by the defendants, and not the significantly reduced fixed award of costs I have made.

[98] Finally, I think it unwise in the particular circumstances of this case to adopt a cost payment approach suggesting to the plaintiffs and their counsel that the plaintiffs effectively are immunized from having to pay costs until the end of the litigation. In that regard:

• As noted in my substantive decision and herein, there were belated and/or inappropriate responses to the defendants’ legitimate requests for co-operation in having Mr Smith attend meetings with defence experts, and a further examination for discovery addressing the significant causation issue raised by the report of Dr Richards.
• As discussed above, that conduct had a significant impact on the progress of this litigation. As the set pretrial and trial dates were vacated, this litigation still has a “long way to go” before its final resolution.
• An obligation to make timely payment of interim cost awards hopefully will provide the plaintiffs and their counsel with greater incentive to give more considered thought to their positions and conduct as the litigation moves forward.

[99] For all these reasons, I am not inclined to depart from the general practice contemplated by Rule 57.01(1)(a).

Conclusion

[100] In the result, an order shall go whereby the plaintiffs shall pay the defendants costs fixed in the all-inclusive amount of $9000.00, payable within 30 days.

[101] To be clear, that cost disposition is intended to dispose of all cost claims in relation to the two motions before me; i.e., the defendants’ motion and the plaintiffs’ cross-motion.

[102] To facilitate entry of the formal orders required to finally dispose of the two motions, costs of the defendants’ motion are fixed in the all-inclusive amount of $9,000, payable by the plaintiffs within 30 days, and no costs are awarded in relation to the plaintiffs’ cross-motion.

“Justice I. F. Leach” Justice I.F. Leach

Date: December 28, 2018

[1] For reasons also set forth in my earlier decision, I declined to make an order, requested by the defendants, specifically permitting a “continued” oral discovery examination specifically addressing contemplated “follow-up questions” that might arise in the wake of intended efforts, (covered by the agreed interim order), to address and answer undertakings not yet satisfied. However, I did so without prejudice to the ability of the parties to seek further relief from the court in the future, if and as necessary, once the parties had completed the further agreed steps towards satisfaction of undertakings and full disclosure.

[2] In saying that, I once again am mindful that the defendants did not immediately obtain their further requested order directing a “continued” oral discovery examination in relation to anticipated answers to previously given undertakings; i.e., in addition to the order directing a “further” oral discovery examination in relation to the second hand injury. However, that denial of relief reflected a finding of prematurity rather than any ruling on the merits of the request.

[3] The defendants also significantly expanded their request for relief at the eleventh hour; e.g., in seeking a further oral discovery examination of Mr Smith in relation to the second injury. However, for the reasons outlined in my substantive decision, in my view the timing of those developments stemmed from relatively recent actions taken by the plaintiff; i.e., belated delivery of an expert report suggesting a causal connection between the first and second hand injuries sustained by Mr Smith, regardless of indications to the contrary provided during his initial oral discovery examination.

[4] Rule 57.01(1), dealing with situations involving claims or defences being advanced separately but inappropriately, similarly has no relevance in this case.

[5] I am mindful of the reality that defence counsel similarly offered nothing in support of their assertions disputing property. However, the defendants did not bear the onus of establishing a valid reason for departing from the general practice contemplated by Rule 57.03(1)(a).