Court File and Parties
COURT FILE NO.: CV-13-4164-00 DATE: 2019 03 04 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: DARREN JOHN, Plaintiff - and - NORBERT BARTELS, Defendant
BEFORE: EMERY J.
COUNSEL: Darren John self-represented Plaintiff Jane E. Sirdevan for Defendant Norbert Bartels
HEARD: In writing
Endorsement on Costs
Basis for the Action
1Darren John sued his lawyer, Norbert Bartels, for negligence over how Mr. Bartels represented Mr. John at his trial on two counts of fraud. The trial took place before Justice Baldwin of the Ontario Court of Justice in 2012.
2Mr. Bartels was removed from the record as Mr. John’s counsel on the first day of the eight day trial.
3Mr. John had set up a defence that he has a brother who actually committed the offences. Justice Baldwin convicted Mr. John on both counts after finding as a fact that Mr. John does not have a brother. Justice Baldwin concluded that the individual shown in surveillance footage on the date of the offences had the same body size, height and facial features as Darren John, and stated she was satisfied beyond a reasonable doubt of his guilt.
4Mr. John appealed his conviction to the Court of Appeal. He brought a motion in that appeal for the court to consider fresh evidence in the form of a music video that Mr. John, who was self-represented at the relevant time, did not seek to introduce at trial. It was suggested on appeal that this music video depicted another individual who resembled Mr. John to support the theory of his defence.
5In the endorsement found at R. v. John, 2014 ONCA 631, the court allowed the appeal from conviction and ordered a new trial for the following reasons:
[4] On consent of the Crown, we reviewed the videotape in question. The Crown concedes, properly in our view, that if we conclude that there is a reasonable possibility, based on the videotape, of misidentification of the perpetrator in this case, a new trial is required to prevent a possible miscarriage of justice. Having viewed the videotape and the still photographs from the crime scene, we do so conclude.
[5] In our view, this is not one of those extraordinary cases in which a stay of criminal proceedings is warranted. Accordingly, the conviction appeal is allowed and a new trial is ordered. Of course, it will be for the judge presiding at the new trial to determine the admissibility of the videotape relied on by the appellant and, if admitted, its significance.
6The Crown elected not to proceed with another trial on those charges.
7Mr. John brought this action against Mr. Bartels to recover the alleged cost of a lawyer he retained for the preparation of the appeal. A “Bill of Costs” from a lawyer, Shahen Alexanian, was produced at trial to support Mr. John’s claim for damages. Mr. Alexanian did not represent Mr. John at the appeal when it was heard; Mr. John had the assistance of duty counsel that day.
8Mr. John alleged in the statement of claim that Mr. Bartels had been negligent at the criminal trial for, among other things, requiring him to testify in his own defense, failing to comply with Mr. John’s instructions not to speak with Crown counsel, and failing to warn Mr. John that the Crown could ask the presiding Justice for an adjournment to call reply evidence. The Crown in fact called reply evidence to disprove Mr. John’s defence that he had a brother who had impersonated him to commit the offences for which he was charged.
The Trial of the Action
9The trial proceeded on January 8 to 11, 2019 before a jury in Brampton. The trial proceeded by jury because Mr. John had filed a Jury Notice. The parties expected the trial to take between two and three days.
10Mr. John did not call an expert at trial to provide opinion evidence on the standard of care that counsel in similar circumstances would be required to meet at a criminal trial.
11The jury found that Mr. John had not proven the standard of care he alleged Mr. Bartels had breached when representing him as his lawyer. This finding made all remaining questions relating to findings of fact and damages unnecessary to answer. The verdict of the jury was entered, and the court dismissed the action.
Costs Claimed by the Successful Defendant
12Mr. Bartels now seeks his costs of the action on a partial indemnity basis as follows:
- Fees $33,423.50
- Disbursements $3,713.57
- HST $4,748.78 Total $41,885.85
13In support of that claim, Mr. Bartels has filed four pages of costs submissions. In addition, he has attached a three page bill of costs setting out the breakdown of hours expended by counsel for each stage of the action up to and including trial.
14Mr. Bartels is seeking costs at only a partial indemnity level. I shall therefore refrain from making any observation or comment about Mr. John’s conduct at trial. There is no need for the court to examine whether the behaviour of a party is reprehensible or egregious to the point of offending the sensibilities of the court, except where costs are claimed at a higher level: Davies v. Clairington (City of), 2009 ONCA 722.
15There is no question that Mr. Bartels was the successful party in this action. As the successful party, it is reasonable for him to have an expectation that he will be awarded costs, absent special circumstances: Bell Canada v. Olympia & York Developments Ltd., [1994] O.J. No.343 (Ont.C.A.). In the absence of any submission from Mr. John to challenge that claim or to provide a reason to order otherwise, Mr. Bartels is entitled to the costs of this action.
16The real question concerns the proper amount Mr. Bartels should be awarded for the costs he has claimed in his submissions, including indemnity for legal fees, HST on those fees, and disbursements incurred to defend the action.
17Mr. John has not filed any meaningful response to those submissions.
Rule 57.01 Factors
18The court has the discretion to award costs in an action under section 131(1) of the Court of Justice Act. This discretion is guided by those factors set out in Rule 57.01(1), and overarching principles the courts have established when ordering costs. One of the fundamental principles in the law of costs is that the amount ordered for costs must be fair and reasonable to the unsuccessful party.
19Counsel for Mr. Bartels has provided the partial indemnity hourly rates of each member of the legal team who has recorded time in defending the action. Those rates are as follows:
| NAME | EXPERIENCE | PARTIAL INDEMNITY RATE |
|---|---|---|
| Jane Sirdevan | 18 years | $195 |
| Sarah Petersen | 8 years | $115 |
| Bill Michelson | 4 years | $110 |
| Neesa Craven | Law Clerk | $60 |
| Dasha Peregoudova | Student at Law | $60 |
| Jenny Forgie | Law Clerk | $60 |
20When considering the factors under Rule 57.01(1) in the exercise of my discretion to award costs, I make the following observations:
1. The Principle of Indemnity
21Ms. Sirdevan is approaching senior counsel status at a large Toronto firm. However, her partial indemnity hourly rate of $195 an hour is most reasonable having regard to rates charged by other counsel of similar experience in other cases. The bill of costs shows her billable rate to the client as $325 an hour, which is significantly lower than the effective billing rate for a lawyer of 18 years’ experience in Toronto.
22I also note from the bill of costs that the hourly rates for Ms. Petersen and Mr. Michelson are $195 and $180 an hour respectively. The partial indemnity rates claimed for all three lawyers against those billable rates are entirely justifiable for the purposes of indemnity.
23The bill of costs sets out the hours provided by each member of the defense team at indicated stages of the action. I find the hourly rates claimed for each legal professional on a partial indemnity basis to be reasonable. I also find that the number of hours and the allocation of legal services between counsel and staff at those stages of the action to be both rational in approach, and cost effective to deliver those services.
2. The Amount of Costs that an Unsuccessful Party Can Reasonably Expect to Pay
24I cannot determine what Mr. John could reasonably expect to pay in relation to any step in the action. He chose to make no submissions on what costs he could reasonably expect to pay as the unsuccessful party. In the absence of those submissions, I can only determine what would be a fair and reasonable amount for the court to award to Mr. Bartels after considering all relevant factors and principles.
3. The Amount Claimed in the Action
25Mr. John asked for $500,000 in damages, and $500,000 for punitive damages in the statement of claim. The only document he relied upon to prove his damages at trial was the Bill of Costs purportedly prepared by Mr. Alexanian, who is not called to testify at trial. Although Mr. John claimed damages for mental distress, loss of employment, loss of “competitive edge” and travel costs, no evidence was led to prove those damages. As no primary finding of liability was found by the jury, there was no independent actionable wrong that could be found to support an award of punitive damages.
26In reality, this action revolved around the $19,500 he allegedly owes (of which he has only paid $1,500 to date) to Mr. Alexanian for the preparation of his appeal materials. This amount is clearly within the monetary jurisdiction of the Small Claims Court. In hindsight, this action should have been brought in that court to be heard by a deputy judge, and not by a jury.
4. The Importance of the Issues
27This was an action to obtain judgment in the amount of $19,500 for Mr. John. However, the action impugned the professional reputation of Mr. Bartels. While Mr. John considered it important to obtain an award to have money paid to him, it was more important for Mr. Bartels in terms of protecting not only his reputation, but his credibility and livelihood in his chosen profession.
5. Was Any Step Taken Was Improper, Vexatious, or Unnecessary
28The trial was scheduled to take two or three days. Mr. John raised several points in evidence about the admissibility of documents, which added to the time for trial. For instance, when Ms. Sirdevan attempted to introduce the Reasons for Judgment of Justice Baldwin from the criminal trial to cross-examine Mr. John on the reason why that court had found him guilty, he objected to the admissibility of those Reasons for Judgment reprinted from the website under R. v. John, 2013 ONCJ 765. He raised this objection because I had made an evidentiary ruling the previous day with respect to the admissibility of the Bill of Costs purportedly prepared by Mr. Alexanian as to the fact he had been given such a document, but not for the truth of its contents.
29I invited the parties to make submissions on whether the website was a legitimate source of court decisions for use at trial, or to introduce the Reasons for Judgment from the criminal trial another way. The authenticity of the Reasons for Judgment was finally satisfied when Ms. Sirdevan obtained a signed copy of the Reasons for Judgment from the office of the Ontario Court of Justice at Milton. I accepted those Reasons for Judgment with Justice Baldwin’s signature as a court document under section 36 of the (Ontario) Evidence Act. Mr. John’s objection to the copy of the document and the time it took to answer it consumed half a day, which pushed the trial into a fourth day.
6. Any Other Matter Relevant to the Question of Costs
30Mr. John did not attend trial until after 12:00 noon on the fourth day. Mr. John had given notice to the court at least two days before January 11, 2019 that he had an appointment with an office in Toronto where he was obtaining legal assistance on another matter. Mr. John had been directed that the court expected him to rearrange that appointment and to attend at this trial so that he would not inconvenience the jury and everyone else to complete the trial. He did not.
Proportionality / Fees
31All of the factors I have considered under Rule 57.01(1) favour an award of costs in the amount claimed by Mr. Bartels. However, I am not awarding costs in that amount because it would not be proportionate to the amount actually involved in Mr. John’s claim.
32When applying Rule 57.01(1), I am mandated by subrule 1.04(1.1) to make orders that are proportionate to the importance and complexity of the issues, and to the amount involved in the action. I have already spoken about the importance of the issues, and identified the amount involved. In the result, I must keep those observations in mind and make a costs award that is proportionate having regard to them. The Court of Appeal spoke of the fundamental importance of proportionality as a principle to apply to any sound costs award in Marcus v. Cochrane, 2014 ONCA 207 at paragraph 15 as follows:
[15] In fixing those costs, it is important to remember that the dispute was essentially about a claim for approximately $80,000. The partial indemnity bill of costs of appellant’s counsel Mr. Marks was $172,645.55. The full indemnity bill of costs of the respondents was $160,706.99. The comparison of what this dispute was about and what was spent on it is stark and difficult to justify. While undoubtedly Mr. Marks, as counsel asserting the claim, must bear the greater responsibility, the principle of proportionality which is fundamental to any sound costs award cries out for application by both counsel. With the assistance and indeed the direction of the trial judge if need be, counsel simply must cut the cloth to fit. The health of the justice system depends on it. Trial costs cannot serve as an incentive to look away from this important challenge.
33Partial indemnity costs are generally fixed at between 60 and 65% of what a party claiming costs has actually incurred for the legal expense of having counsel represent them in the action. Substantial indemnity costs mean costs that are awarded in an amount that are 1.5 times what would otherwise be awarded on a partial indemnity basis. Full recovery costs, sometimes given in family law cases, mean an amount that a party must pay, or has already paid to their lawyer.
34In view of my observation that this case was more important to Mr. Bartels in relative terms, I am awarding Mr. Bartels the costs he is entitled to receive at 65% of a base amount to partially indemnify him. However, I consider that base amount for the purposes of proportionality to be $19,500. I find it difficult to reconcile awarding more than a dollar spent to defend a dollar in this action as a maximum for complete indemnity. Therefore, Mr. Bartels is awarded $12,675 for fees, plus $1,650 for HST on those fees. I conclude that this award for fees is more than fair and reasonable to Mr. John.
Disbursements
35The recovery of disbursements must also be awarded on a principled basis. Two such principles are that the disbursements claimed must be relevant to the action and reasonable for its prosecution or defense. The other is that they must also be fair and reasonable to the unsuccessful party.
36Mr. John had a duty as a party to this action to make full and continuous disclosure of these document to Mr. Bartels. He did not do so. He must therefore bear the cost of Mr. Bartels obtaining that documentary disclosure from other sources to defend himself.
37Mr. John did not provide any materials from the first trial before Justice Baldwin or the appeal in 2014 to counsel for Mr. Bartels. Mr. John’s failure to cooperate and his refusal to abide by his disclosure obligations under the Rules required Mr. Bartel’s lawyers to attend at the court office at Osgoode Hall to take copies of documents from the appeal file.
38Mr. Bartels is entitled to all court fees he has paid as well as fees paid to the examiner’s office for the examination for discovery of Mr. John. I am also allowing the other disbursements claimed for the conduct of the action, including the disbursements incurred for legal process servers. These are all expenses Mr. Bartels has incurred in the conduct of his defence to this action.
39Mr. Bartels is awarded a further $3,713.57 for disbursements, plus $403.72 for HST on that amount.
Conclusion
40Norbert Bartels is therefore awarded the costs of this action, rounded to $18,500. Darren John is ordered to pay these costs within 30 days.
Emery J. Released: March 4, 2019
COURT FILE NO.: CV-13-4164-00 DATE: 2019 03 04 ONTARIO SUPERIOR COURT OF JUSTICE
B E T W E E N: DARREN JOHN, Plaintiff - and - NORBERT BARTELS, Defendants
ENDORSEMENT ON COSTS
EMERY J. Released: March 4, 2019