Court File and Parties
COURT FILE NO.: CV-15-536174
DATE: 20180201
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
JOSEPH S. MANCINELLI, CARMEN PRINCIPATO, DOUGLAS SERROUL, LUIGI CARROZZI, MANUEL BASTOS and JACK OLIVEIRA in their capacity as THE TRUSTEES OF THE LABOURERS’ PENSION FUND OF CENTRAL AND EASTERN CANADA, and CHRISTOPHER STAINES
Plaintiffs
– and –
ROYAL BANK OF CANADA, RBC CAPITAL MARKETS LLC, BANK OF AMERICA CORPORATION, BANK OF AMERICA, N.A., BANK OF AMERICA CANADA, BANK OF AMERICA NATIONAL ASSOCIATION, THE BANK OF TOKYO MITSUBISHI UFJ LTD., BANK OF TOKYO-MITSUBISHI UFJ (CANADA), BARCLAYS BANK PLC, BARCLAYS CAPITAL INC., BARCLAYS CAPITAL CANADA INC., BNP PARIBAS GROUP, BNP PARIBAS NORTH AMERICA INC., BNP PARIBAS (CANADA), BNP PARIBAS, CITIGROUP, INC., CITIBANK, N.A., CITIBANK CANADA, CITIGROUP GLOBAL MARKETS CANADA INC., CREDIT SUISSE GROUP AG, CREDIT SUISSE SECURITIES (USA) LLC, CREDIT SUISSE AG, CREDIT SUISSE SECURITIES (CANADA), INC., DEUTSCHE BANK AG, THE GOLDMAN SACHS GROUP, INC., GOLDMAN, SACHS & CO., GOLDMAN SACHS CANADA INC., HSBC HOLDINGS PLC, HSBC BANK PLC, HSBC NORTH AMERICA HOLDINGS INC., HSBC BANK USA, N.A., HSBC BANK CANADA, JPMORGAN CHASE & CO., J.P.MORGAN BANK CANADA, J.P.MORGAN CANADA, JPMORGAN CHASE BANK NATIONAL ASSOCIATION, MORGAN STANLEY, MORGAN STANLEY CANADA LIMITED, ROYAL BANK OF SCOTLAND GROUP PLC, RBS SECURITIES, INC., ROYAL BANK OF SCOTLAND N.V., ROYAL BANK OF SCOTLAND PLC, SOCIÉTÉ GÉNÉRALE S.A., SOCIÉTÉ GÉNÉRALE (CANADA), SOCIÉTÉ GÉNÉRALE, STANDARD CHARTERED PLC, UBS AG, UBS SECURITIES LLC and UBS BANK (CANADA)
Defendants
Counsel:
Louis Sokolov for the Plaintiffs
Lara Jackson for the Bank of Montreal, BMO Financial Corp., BMO Harris Bank N.A., BMO Capital Markets Limited
Paul Le Vay, for the Toronto Dominion Bank, TD Bank, N.A., TD Group Holdings, LLC, TD Bank USA, N.A. and TD Securities Limited
Proceeding under the Class Proceedings Act, 1992
HEARD: In writing
Reasons for Decision – Costs
PERELL, J.
"What's sauce for the goose is sauce for the gander." – old proverb
[1] This is a costs decision with respect to a motion to add two Defendants to a class action.
[2] On September 11, 2015, pursuant to the Class Proceedings Act, 1992[^1], the Plaintiffs sued 16 groups of financial institutions (48 banks in all) about an alleged price-fixing conspiracy that occurred between January 1, 2003 and December 31, 2013. On July 20, 2016, approximately two and a half years after the end of the alleged conspiracy, the Plaintiffs sought to add two more groups of Defendants. The proposed new Defendants comprised nine financial institutions; namely: (1) Bank of Montreal, BMO Financial Corp., BMO Harris Bank N.A., and BMO Capital Markets Limited ("BMO"); and (2) Toronto Dominion Bank, TD Bank, N.A., TD Group Holdings, LLC, TD Bank USA, N.A., and TD Securities Limited ("TD").
[3] BMO and TD disputed being joined to the action, and they argued that they should not be added because the claims against them were statute-barred under the Limitations Act, 2002[^2]. The Plaintiffs responded that the claims were not statute-barred because they did not discover their claims against BMO and TD until May 24, 2016. The Plaintiffs argued that discovery of the claims occurred only after the Plaintiffs had signed a settlement agreement with a defendant who proffered evidence that implicated BMO and TD as parties to the alleged conspiracy. In the result, I refused to join BMO and TD as parties, and I dismissed the Plaintiffs’ motion.[^3]
[4] BMO seeks costs of $99,724.96, all inclusive, on a partial indemnity basis. TD seeks costs of $95,908.69, all inclusive, on a partial indemnity basis.
[5] The Plaintiffs, who if they had have been successful on their motion would have claimed costs of $91,496.99, all inclusive, on a partial indemnity basis, submit that BMO and TD should receive no costs because of the novelty of the issue of the discoverability and investigation of conspiracy claims and the absence of case law on this issue.
[6] In the alternative, the Plaintiffs submit that the Defendants’ costs requests are excessive and beyond the reasonable expectations of the unsuccessful party. The Plaintiffs submit that the appropriate awards are $50,000, all inclusive, to BMO and $50,000, all inclusive to TD.
[7] BMO and TD were the successful parties on a very significant and vigorously contested motion, which subject to what the appellate courts may say, has forever removed them as Defendants to a $1 billion dollar class action. The normal rule and expectation of successful parties is that they receive their costs on a partial indemnity basis.
[8] There is no merit to the Plaintiffs’ submission that this is an appropriate case to make no order as to costs.
[9] For an issue to be novel in the legally significant way that would justify the court in ordering no costs against the party who unsuccessfully advanced the issue, it is not enough that the issue is unprecedented or that the issue has not been decided before.[^4] The legally significant novelty of a legal issue is found in the circumstance that the existing case law is inadequate to resolve the issue and there would be no proper reason for the party advancing the issue to expect to fail.[^5] If a litigant submits that a case is novel because there is no decided case directly on point, he or she may be met with the argument that although there are no decided cases, the law is clearly against the case, so the litigant should reasonably expect to lose and thus the case is not novel in the requisite sense that would justify making no order as to costs.[^6]
[10] In the immediate case, there was adequate case law to decide the joinder issue, and I see no novelty in the requisite sense that would justify making other than the normal order as to costs. Plaintiffs moving to join defendants to an existing action after the expiry of a limitation period and relying on discoverability are not venturing into uncharted legal territory. Even in the context of conspiracy claims, there are existing cases about the operation of the discoverability principle.
[11] Moreover, had the Plaintiffs succeeded on the motion to join BMO and TD (and should they succeed on appeal), I rather doubt that they would have (or will) submit that given the novelty of the issues, the successful party should receive no costs.
[12] With the Plaintiffs having disclosed that they would have claimed $91,496.99 had they been the successful party, there is not a great deal of traction to their submission that BMO’s claim for $99,724.96 and TD’s claim for $95,908.69 are excessive and not within the reasonable expectations of the unsuccessful party.
[13] BMO and TD were separately represented, and each defendant was entitled to marshal its own defence to being joined to a $1 billion dollar conspiracy action after the limitation period had expired.
[14] I emphasize that costs are to indemnify the clients for the costs they incur in litigation and I see no reason why either BMO’s or TD’s claim to be indemnified for the costs they incurred should be discounted by the circumstance that there is a co-defendant also incurring costs.
[15] For the above reasons, I award BMO $99,724.96, all inclusive, and TD $95,908.69, all inclusive.
Perell, J.
Released: February 1, 2018
COURT FILE NO.: CV-15-536174
DATE: 20180201
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
JOSEPH S. MANCINELLI, CARMEN PRINCIPATO, DOUGLAS SERROUL, LUIGI CARROZZI, MANUEL BASTOS and JACK OLIVEIRA in their capacity as THE TRUSTEES OF THE LABOURERS’ PENSION FUND OF CENTRAL AND EASTERN CANADA, and CHRISTOPHER STAINES
Plaintiffs
– and –
ROYAL BANK OF CANADA, RBC CAPITAL MARKETS LLC, BANK OF AMERICA CORPORATION, BANK OF AMERICA, N.A., BANK OF AMERICA CANADA, BANK OF AMERICA NATIONAL ASSOCIATION, THE BANK OF TOKYO MITSUBISHI UFJ LTD., BANK OF TOKYO-MITSUBISHI UFJ (CANADA), BARCLAYS BANK PLC, BARCLAYS CAPITAL INC., BARCLAYS CAPITAL CANADA INC., BNP PARIBAS GROUP, BNP PARIBAS NORTH AMERICA INC., BNP PARIBAS (CANADA), BNP PARIBAS, CITIGROUP, INC., CITIBANK, N.A., CITIBANK CANADA, CITIGROUP GLOBAL MARKETS CANADA INC., CREDIT SUISSE GROUP AG, CREDIT SUISSE SECURITIES (USA) LLC, CREDIT SUISSE AG, CREDIT SUISSE SECURITIES (CANADA), INC., DEUTSCHE BANK AG, THE GOLDMAN SACHS GROUP, INC., GOLDMAN, SACHS & CO., GOLDMAN SACHS CANADA INC., HSBC HOLDINGS PLC, HSBC BANK PLC, HSBC NORTH AMERICA HOLDINGS INC., HSBC BANK USA, N.A., HSBC BANK CANADA, JPMORGAN CHASE & CO., J.P.MORGAN BANK CANADA, J.P.MORGAN CANADA, JPMORGAN CHASE BANK NATIONAL ASSOCIATION, MORGAN STANLEY, MORGAN STANLEY CANADA LIMITED, ROYAL BANK OF SCOTLAND GROUP PLC, RBS SECURITIES, INC., ROYAL BANK OF SCOTLAND N.V., ROYAL BANK OF SCOTLAND PLC, SOCIÉTÉ GÉNÉRALE S.A., SOCIÉTÉ GÉNÉRALE (CANADA), SOCIÉTÉ GÉNÉRALE, STANDARD CHARTERED PLC, UBS AG, UBS SECURITIES LLC and UBS BANK (CANADA)
Defendants
REASONS FOR DECISION - COSTS
PERELL J.
Released: February 1, 2018
[^1]: S.O. 1992, c. 6. [^2]: S.O. 2002, c. 24, Sched. B. [^3]: Mancinelli v. Royal Bank of Canada, 2017 ONSC 7384. [^4]: McCracken v. Canadian National Railway Co., 2012 ONSC 6838. [^5]: Baldwin v. Daubney, 2006 33317 (ON SC), [2006] O.J. No. 3919 (S.C.J.) at paras. 19-22; Fisher v. IG Investment Management Ltd., 2014 ONSC 6260 (Div. Ct.); Mancinelli v. Royal Bank of Canada, 2017 ONSC 1196; Quality Rugs of Canada Ltd. v. Sedona Development Group (Lorne Park) Inc., 2017 ONSC 1353; Vesper v. Boston Scientific Ltd., 2017 ONSC 2498 at para. 50. [^6]: Baldwin v. Daubney (2006), 2006 33317 (ON SC), 21 B.L.R. (4th) 232 (Ont. S.C.J.) at para. 22.