Court File and Parties

COURT FILE NO.: 3927-14 DATE: 2019/03/08 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: BRIANNA PHELAN, EWAN PHELAN and RACHEL PHELAN and SARAH ELIZABETH PHELAN, by their Litigation Guardian, Brianna Phelan Plaintiffs

And:

BELLA BEAUTY SUPPLIES INC., a Trademark of LIFESTYLE PRODUCTS, HELEN OF TROY CANADA, INC., HELEN OF TROY LP and SHOPPERS DRUG MART and JOHN DOE CHINESE CORPORATION Defendants

BEFORE: Justice I. F. Leach

COUNSEL: Nancy M. McAuley, for the plaintiffs Charles Amissah-Ocran, for the defendant Bella Beauty Supplies Inc., a Trademark of LIFESTYLE PRODUCTS No one appearing for the remaining defendants.

HEARD: February 6, 2019

Endorsement

Summary Judgment and Costs

Introduction

[1] In formal terms, this matter came before me as a motion by the defendant Bella Beauty Supplies Inc., a Trademark of Lifestyle Products, (“Bella”), the only remaining defendant to this litigation, for summary judgment dismissing the plaintiffs’ claims against it, along with “costs thrown away and costs of the motion on a substantial indemnity basis”.

[2] However, that formal description does not accurately capture the realities of the underlying situation, as there was no dispute – at least by the time the matter came before me – that the plaintiffs’ claims against the moving defendant should be dismissed.

[3] The real question to be decided is whether the plaintiffs should be obliged to pay claimed costs and other sums to the defendants, and if so, the appropriate scale and quantum of such an award.

Background

[4] An understanding of the manner in which the parties arrived at their present dispute relating to costs and the other sums claimed by Bella requires an appreciation of this matter’s somewhat extended but relatively uneventful litigation history.

[5] In that regard, I am mindful of the following developments, which in my view were either acknowledged, undisputed or not the subject of conflicting evidence in the material filed before me:

• On September 16, 2012, Brianna Phelan was using a curling iron, (purchased at a Shoppers Drug Mart location here in Ontario, and bearing the name “Bella”), when she was seriously injured by an electric shock attributed to the relevant curling iron.
• Ms Phelan and her family, (i.e., her husband Ewan Phelan and her daughters Rachel and Sarah Phelan), retained the services of plaintiff counsel to investigate the matter and pursue appropriate claims for compensation in relation to the various types of damages said to have been experienced by the Phelan family as a result of the incident.
• On or about September 18, 2013, plaintiff counsel sent Bella a letter before action, putting Bella on notice that Ms Phelan intended to commence an action against Bella, seeking damages in relation to “injuries sustained while using a Bella curling iron on September 16, 2012”. Amongst other things, the correspondence also invited Bella to refer the letter to its liability insurer.
• On or about June 19, 2014, plaintiff counsel sent another copy of the aforesaid letter before action to Bella, under cover of a further letter once again putting Bella on notice of its intention to commence legal proceedings, and inviting Bella to refer the correspondence to its liability insurer.
• On or about August 27, 2014, (i.e., approximately 20 days before expiry of the ostensible two year basic limitation period created by section 4 of the Limitations Act, S.O. 2002, c.24), plaintiff counsel issued a statement of claim seeking formal various types of damages from a number of named defendants, including Bella, Helen of Troy Canada Inc. (“HOTCI”), and Shoppers Drug Mart Inc. (“SDMI”). In that regard:
  • All three of the named defendants were said to have played a role in the design, manufacture, marketing, distribution and/or retailing of the relevant curling iron;
  • Bella was specifically identified as a beauty supply establishment thought to have been involved in the design, manufacture, packaging and/or distribution of the relevant curling iron;
  • HOTCI was identified as an Ontario corporation thought to have been involved in the design, manufacturer, packaging and/or distribution of the relevant curling iron; and
  • SDMI was identified as the relevant retailer of the curling iron in question.
• Service of the statement of claim apparently was effected on each of the defendants, including Bella, shortly thereafter. In particular, Bella was served with the original statement of claim on or about September 10, 2014.
• When the aforesaid plaintiff counsel correspondence and statement of claim came to the attention of Bella’s principal, Job Owusu Appiah, he realized immediately that the plaintiffs and/or their counsel clearly had made an error in thinking Bella had any involvement whatsoever in relation to the relevant “Bella” curling iron giving rise to the statement of claim. In particular:
  • From its inception, Bella had been a private corporation in respect of which Mr Appiah always had been its sole director and shareholder.
  • From Bella’s inception, and without interruption, Mr Appiah always had been the sole person responsible for managing Bella’s affairs.
  • Mr Appiah knew and was quite certain:
    • that the business operations of Bella were entirely confined to a single store location in Brampton, from which Bella sourced and sold beauty products and accessories;
    • that the products sold by Bella generally were limited to wigs and wig accessories;
    • that the business operations of Bella had never extended to any electrical products, let alone any electrical curling irons; and
    • more generally, that Bella was in no way connected or affiliated with the named co-defendants HOTCI and SDMI, and had never had any involvement whatsoever with the “Bella” curling iron giving rise to the litigation.
• In short, Mr Appiah knew and was quite certain, from the outset of this legal dispute, that there was no connection whatsoever between his company and the curling iron underlying the plaintiffs’ claim, apart from the coincidence of their both having the name “Bella”. He accordingly was justifiably certain that the plaintiffs’ claims against Bella had no merit whatsoever.
• Immediately after service of the statement of claim on Bella, Mr Appiah therefore telephoned the office of plaintiff counsel, in an effort to persuade plaintiff counsel, through oral assurances, that a mistake had been made. However, it also seems that Mr Appiah made no effort to request direct communications with plaintiff counsel representing Bella. Mr Appiah instead was content to emphasize, to receptionists and/or secretarial staff employed by plaintiff counsel that Bella did not sell any electrical products, let alone the curling iron underlying the plaintiffs’ claim. The staff in question apparently responded with further indications that the statement of claim should be referred to Bella’s liability insurer, which ultimately would bear responsibility for any damages ordered by the court.
• Notwithstanding such repeated written and oral indications that Bella should refer the claim to its liability insurer, Mr Appiah was reluctant to do so. In particular, he feared that doing so, even in relation to a claim he knew to be unmeritorious, would cause Bella’s insurance premiums to increase and thereby eradicate Bella’s narrow profit margin.
• On or about October 29, 2014, plaintiff counsel sent further correspondence. Amongst other things, the letter indicated that plaintiff counsel still had heard nothing from Bella’s liability insurer or Bella itself, and threatened to institute default proceedings against Bella unless Bella delivered a statement of defence on or before November 24, 2014.
• Notwithstanding that clear indication plaintiff counsel had not been made aware of the alleged telephone calls made to plaintiff counsel’s law firm by Mr Appiah, he made no effort to contact plaintiff counsel directly to clarify and confirm that Bella had no involvement in the underlying matter, despite the coincidence between its name and the name on the relevant curling iron. Mr Appiah instead chose to retain independently, (i.e., without the involvement of Bella’s liability insurer), the legal services of Mr Amissah-Ocran to represent Bella in this litigation. The sworn evidence of Mr Appiah indicates and confirms that he retained Mr Amissah-Ocran to defend the action because he knew that Bella had “nothing at all to do with the [curling iron] product or with the plaintiffs”.
• Bella delivered its statement of defence, without advancing any cross-claims against its co-defendants, on or about November 28, 2014. As one might expect in the circumstances, the pleading is very brief. Indeed, its substantive content is limited to one and a half pages. Apart from expressly indicating that it denied or had no knowledge of specified allegations pleaded by plaintiffs, Bella noted in particular that it had never been a designer, manufacturer, packager, distributor or seller of the curling iron in question, and had no association with “Trademark of Lifestyle” products. Bella’s pleading finally emphasized in writing, and in no uncertain terms, that the “similarity between its business name and the curling iron described in the plaintiffs’ statement of claim [was] purely accidental”, and that Bella had “nothing to do with the curling iron referred to in the plaintiffs’ statement of claim”.
• On or about January 20, 2015, HOTCI and SDMI delivered a joint statement of defence, without advancing any cross-claims against Bella. Amongst other things, the pleading indicated:
  • that HOTCI had no involvement in the design, manufacturer, packaging or distribution of the relevant curling iron;
  • that HOTCI instead acts as a sales representative in Canada for Helen of Troy LP (“HOTLP”);
  • that HOTLP was the company which designed and developed the relevant curling iron, as well as its corresponding packaging and product documentation, in consultation with SDMI, which sourced the curling iron developed by HOTLP as a “private label product”, adding the particular brand name “Bella” to the product;
  • that HOTLP did not manufacture the curling iron, but contracted with an unnamed Chinese manufacturer to make the product in accordance with design specifications provided by HOTLP;
  • that SDMI purchased the curling iron product from HOTLP, which in turn then sold the curling iron to consumers;
  • that SDMI had sold almost 15,000 such curling irons over the previous six years; and
  • that the pleading defendants had no knowledge about Bella.
• On or about August 18, 2015, the plaintiffs, with the consent of all concerned, amended their statement of claim to delete HOTCI as a named defendant, add HOTLP as a named defendant; and also add “John Doe Chinese Corporation” as a further named defendant. [1]
• Progress towards completion of oral examinations for discovery then was delayed repeatedly, with a number of contemplated examination dates being scheduled, cancelled and rescheduled. In particular:
  • In November of 2015, arrangements were made to proceed with examinations of the defendants on May 9, 2016, and examinations of the plaintiffs on May 10, 2016. However, those arrangements were cancelled on or about April 26, 2016, to allow further time for completion of expert testing commissioned by plaintiff counsel and counsel representing Bella’s co-defendants. The examinations were rescheduled for the middle of July, 2016.
  • On July 6, 2016, the rescheduled oral discovery examinations once again had to be cancelled and rescheduled, to allow further time for further productions from HOTLP and SDMI. The examinations were rescheduled to November 2 and 4, 2016.
  • On October 31, 2016, the rescheduled discovery examinations had to be cancelled once again, as the aforesaid expert testing still had not been completed. The examinations were rescheduled to December 2, 8 and 9, 2016.
  • Although the litigation had been commenced here in London, (where the plaintiffs were residing and particular lawyers representing the plaintiffs were located), the contemplated venue for all oral discovery examinations was a reporting service located in Toronto; i.e., a location closer to the office of Bella, (in Brampton), the offices of HOTLP and SDMI, (in Mississauga and Toronto respectively), the Milton location of Bella’s lawyer, and the Toronto location of counsel representing HOTLP and SDMI.
• On November 25, 2016, (shortly before his anticipated oral discovery examination as Bella’s representative), Mr Appiah swore an Affidavit of Documents on behalf of Bella. No documents were expressly identified in Schedule “B” or Schedule “C” thereto, which included nothing but brief pro forma recitations addressing the requirements of those schedules. Of the 40 items listed in its Schedule “A”, there is a single item emanating from Bella; i.e., its six page Articles of Incorporation. All of the other listed documents were those generated by the litigation itself and already openly exchanged between the parties, including material such as the following:
  • copies of the letters before action sent to Bella by plaintiff counsel;
  • copies of pleadings, orders, motion material filed in the action;
  • copies of other formal notices and affidavits required by the Rules of Civil Procedure, such as notices of examinations and the affidavits of documents served on Bella by other parties; and
  • copies of non-privileged correspondence, already exchanged openly between counsel, relating to scheduling and similar administrative matters.
• The oral discovery examination of HOTLP’s representative proceeded on December 2, 2016. Although the examination of Bella’s representative was not scheduled or expected to take place until December 8, 2016, (with the relevant notice of examination for Mr Appiah specifying that date), both Mr Appiah and Bella’s counsel chose to attend the examination in its entirety. In the course of the ensuing examination of HOTLP’s representative, (during which questions were posed principally by plaintiff counsel, with Bella’s counsel posing only a modest number of independent questions) [2], HOTLP’s representative confirmed under oath that Bella was not involved in the design, manufacture, packaging and/or distribution of the relevant curling iron.
• On December 7, 2016, plaintiff counsel wrote to Bella’s defence counsel, Mr Amissah-Ocran, proposing to cancel the oral discovery examination of Bella’s representative, in light of the sworn evidence of HOTLP’s representative, confirming that Bella had no involvement with the relevant “Bella” curling iron. The same correspondence indicated that, although plaintiff counsel had not yet received instructions to release Bella from the litigation, plaintiff counsel would be making that recommendation to the plaintiffs.
• Later that day, (i.e., December 7, 2016), Mr Amissah-Ocran indicated that he and his client intended to attend for the scheduled discovery examination of SDMI’s representative the following day unless SDMI provided written confirmation that it too took the position that Bella had no involvement with the relevant curling iron. Through email correspondence copied to all counsel, plaintiff counsel requested that confirmation from SDMI’s counsel, who sent a responding email that same afternoon providing the requested confirmation. In the result, Bella’s representative and counsel did not attend the scheduled oral discovery examination of SDMI’s representative, and the oral discovery examination of Bella’s representative was cancelled.
• From December of 2016 to January of 2018, litigation continued between the plaintiffs, HOTLP and SDMI without the further participation of Bella or its counsel. (For example, neither Bella nor its counsel were sent any further correspondence or productions, and neither Bella’s counsel nor any representative of Bella attended at the further oral discovery examinations of SDMI and the plaintiffs.) However, the plaintiffs took no steps to formally discontinue their claim against Bella. (Plaintiff counsel candidly acknowledged that there was no reason for the lack of follow up in that regard, apart from her extended absence from her office.) On the other hand, neither Bella nor its counsel requested the taking of any such steps. (Bella’s counsel indicated that he and his client were simply “waiting” in that regard.) Indeed, there seems to have been no communication whatsoever between plaintiff counsel and Bella’s counsel for approximately 13 months.
• By January 19, 2018, the plaintiffs had reached a settlement with HOTLP and SDMI. Plaintiff counsel sent correspondence that day to defence counsel, (including counsel for Bella), requesting formal consent to proposed settlement and a contemplated motion to obtain judicial approval of the settlement vis-à-vis the infant plaintiffs.
• On January 24, 2018, Bella’s counsel responded with a letter to plaintiff counsel, indicating that no approval or consent would be provided by or on behalf of Bella until it was provided with compensation for Bella’s “substantial financial expenditure”. In that regard, mention was made of legal fees, loss of income associated with attendance at lawyer meetings and a discovery examination, and the “emotional and psychological toll” brought about by the “unjustifiable” litigation against Bella. Bella’s counsel went further, confirming that he had been instructed to bring a motion for damages, and intended to serve a motion seeking damages “shortly”.
• On January 31, 2018, plaintiff counsel sent further correspondence to Bella’s counsel. Amongst other things, the letter asserted that the plaintiffs’ actions were reasonable, that any costs incurred by Bella were its own responsibility insofar as Bella had failed to refer the matter to its insurer, and that there was basis for Bella’s purported entitlement to damages for mental distress or psychological injury.
• It seems the plaintiffs thereafter worked co-operatively with HOTLP and SDMI to conclude the litigation vis-à-vis those defendants; i.e., finalizing and serving motion material, returnable in London on February 20, 2018, to obtain a judgment dismissing the plaintiffs’ formal claims vis-à-vis those defendants, apart from judicially approved settlements in relation to the two infant plaintiffs.
• Although the aforesaid motion did not affect the litigation between the plaintiffs and Bella, (as no cross-claims had been filed by any of the defendants), Bella’s counsel sent plaintiff counsel a letter on February 5, 2018, complaining that he had not been consulted about the motion or its return date, and indicating an intention to reschedule his commitments so as to appear at the motion on February 20, 2018.
• On February 15, 2018, plaintiff counsel responded with further correspondence emphasizing that the aforesaid motion only to the plaintiffs’ claims vis-à-vis HOTLP and SDMI, that the plaintiffs were not seeking a formal dismissal of the plaintiffs’ claims against Bella, and that any attendance by Bella’s counsel at the motion’s hearing would be unnecessary and an expense for which Bella alone should be responsible. The same letter indicated that the plaintiffs would agree to a dismissal of their claims against Bella on a “without costs”.
• On February 20, 2018, the court granted a formal judgment, formally dismissing the plaintiffs’ claims against HOTLP and SDMI, (apart from the judicially approved settlements in favour of the infant plaintiffs), but effectively leaving the plaintiffs’ claims against Bella intact.
• On March 5, 2018, plaintiff counsel served Bella’s counsel with a formal settlement offer, whereby the plaintiffs confirmed their willingness to settle the claims against Bella in exchange for Bella’s consent to the action against it being dismissed without costs.
• On March 22, 2018, counsel for Bella responded with a letter asking plaintiff counsel to provide dates of availability, in April of 2018, for the hearing of a formal motion by Bella to dismiss the plaintiffs’ claims against Bella, and to recover “costs and damages”.
• On March 26, 2018, plaintiff counsel responded with correspondence to Bella’s lawyer explaining the procedure in London for securing a special appointment hearing of any motion expected to take longer than 30 minutes to argue, and proposed arrangements for an initial return date of the motion that would establish a timetable for further steps, (e.g., the filing of further motion material and cross-examinations), if Bella was intent on bringing and arguing its motion. Plaintiff counsel nevertheless also expressed a willingness to engage in further settlement discussions, inviting Bella’s counsel to provide an indication of the costs being sought.
• However, no response and no such indication was provided by Bella or its counsel. This matter instead moved inexorably forward to the disputed hearing before me on February 9, 2019, with preparatory steps including:
  • Bella’s preparation, service and filing of a summary judgment motion record, (including a supporting affidavit sworn by Mr Appiah), and factum;
  • the plaintiffs’ preparation, service and filing of a responding motion record, responding factum and book of authorities;
  • cross-examination of Mr Appiah on his supporting affidavit; and
  • the plaintiffs’ preparation, service and filing of a supplementary responding record containing a transcript of Mr Appiah’s cross-examination.

[6] With that background in mind, I turn next to consideration of the motion on its merits.

Summary Judgment

[7] As noted above, Bella’s motion seeks summary judgment dismissing the claims against it, pursuant to Rule 20.01(3) of the Rules of Civil Procedure. That rule permits a defendant, after delivering a statement of defence, to “move with supporting affidavit material or other evidence for summary judgment dismissing all or part of the claim in the statement of claim”.

[8] Pursuant to Rule 20.04(2), the court is to grant summary judgment if the court “is satisfied that there is no genuine issue requiring a trial with respect to a claim”, or “the parties agree to have all or part of the claim determined by a summary judgment and the court is satisfied that it is appropriate to grant summary judgment”.

[9] Although counsel for Bella devoted time in Bella’s factum to such matters, in my view there clearly is no question that summary judgment should be granted, dismissing the plaintiffs’ claims against Bella.

[10] Not only is there no genuine issue for trial in that regard, (given the formal admissions and indications made by and/or on behalf of HOTML and SDMI), but the parties before me effectively agree that summary judgment should be granted dismissing the plaintiffs’ claims against Bella.

[11] Moreover, having regard to the circumstances and the affidavit filed by Ms Phelan, in her capacity as Litigation Guardian for the infant plaintiffs, I independently think dismissal of their claims against Bella, without any formal recovery of damages from Bella, is appropriate in the circumstances.

[12] As I indicated at the outset, the formal “summary judgment” nature of this motion is somewhat of a red herring. The true dispute underlying this motion relates to Bella’s assertion that it is entitled to various types of damages and costs.

Bella’s Claim for Damages

[13] As noted above, Bella has asserted, through counsel correspondence, Mr Appiah’s supporting affidavit, and further evidence provided by Mr Appiah during cross-examination on that affidavit, that the plaintiffs should be ordered to pay various types of compensation beyond reimbursement of legal expense; i.e., its costs.

[14] Such additional claims were based on allegations: a. that Bella had sustained significant financial loss and damage as a result of Mr Appiah having to deal with the plaintiffs’ claim; i.e., because Mr Appiah was obliged to close Bella’s store for certain periods of time while he was addressing the litigation, which in turn caused Bella to anger customers, (one of whom broke Bella’s store window), and/or otherwise lose customers and corresponding sales, which in turn has caused Bella to default on its rent payments; and b. that Mr Appiah had experienced significant emotional and/or mental distress, trauma and fear and/or psychological injury attributed to this litigation, warranting an award of compensation for such damages.

[15] In my view, such claims are problematic for a number of reasons, and must be denied.

[16] First, evidence tendered in support of such damage claims was scant, questionable and in my view insufficient. In that regard:

• Despite being pressed repeatedly for particulars during cross-examination on his affidavit, Mr Appiah was unable to provide any detailed supporting evidence, documentation or calculations that would substantiate the significant financial losses being asserted. Details and documentation, including Bella’s income tax returns and a “list or chart” of alleged expenses and losses, were requested but apparently not provided. Mr Appiah could or would only say that Bella had lost “a lot of customers”, and “a lot of money”, which he claimed to have been “at least $12,000.00 for sure”.
• The sworn evidence provided by Mr Appiah, in relation to Bella’s finances, seemed internally inconsistent. On the one hand, he indicated that he did not refer the plaintiffs’ claim to Bella’s insurers because Bella was “just a small retail store”, in respect of which he was “making less than a thousand dollars a week or something like that”, (i.e., $52,000 a year), such that its narrow profit margins would not withstand a feared increase in Bella’s insurance premiums. On the other hand, he indicated that Bella’s financial losses were substantial because it failed, because of this litigation, to make what Mr Appiah said was usual annual gross sales income of $80,000.00, which in turn allowed Mr Appiah to earn an annual net income as low as $30,000.00, and no higher than $50,000.00.
• In my view, the sworn evidence provided by Mr Appiah seemed prone to exaggeration, and was inherently dubious. For example:
  • Mr Appiah claimed to have called the office of plaintiff counsel “more than 20 times”, although he was unable to provide any particulars in that regard, apart from indicating that, on each occasion, he had spoken only to a “receptionist” or a “secretary”; i.e., without ever speaking directly to plaintiff counsel, or asking to speak directly with plaintiff counsel. I think it most unlikely that Mr Appiah would have made that many telephone calls to the office of plaintiff counsel, or that he would have made such a large number of calls without being put through to a lawyer, especially when contemporary correspondence from plaintiff counsel, (not contradicted or questioned at the time or prior to the cross-examination of Mr Appiah), expressly indicated concern that plaintiff counsel had not heard from Bella at all since service of the statement of claim, in turn giving rise to indications that Bella would be noted in default.
  • As noted above, Mr Appiah attended the oral discovery examination of HOTLP’s representative. He also indicated under oath that he had met with his lawyer five or six times. Together, that information indicates a maximum of seven calendar dates on which Mr Appiah might have been required, by the litigation, to be somewhere other than Bella’s store. However, Mr Appiah also acknowledged under oath that his wife and daughter were available to cover for him and keep the store open in his absence on some of those occasions; and that he therefore only had to shut the store “sometimes”, during which he would place a note on Bella’s shop store indicating that he would be back in 2-3 hours. The latter indication was consistent with Mr Appiah’s other evidence that each alleged meeting with his lawyer lasted only 45-60 minutes. Having regard to all of such evidence, it seems clear that, taking the evidence at its highest, the litigation caused Bella’s store to close for a cumulative period of no more than 2-3 days in total, and that the litigation actually never caused closure of Bella’s store for an entire day, with the possible exception of the day on which the representative of HOTML was examined. In such circumstances, I find the suggestion that such closure caused Bella to lose at least $12,000.00 of its normal $80,000.00 in annual sales, (i.e., the suggestion that closure of Bella’s store for less than one percent of the year resulted in it losing 15 percent of its normal annual earnings), self-evidently preposterous – in turn undermining the credibility of Bella’s other assertions and claims.
  • Although Mr Appiah indicated under oath that he had met with his lawyer five or six times, and there were specific indications during cross-examination on Mr Appiah’s affidavit that Mr Appiah had met with Bella’s counsel to prepare prior to each scheduled date of the oral discovery examinations, the Costs Outline filed by Bella suggests a different reality. In particular, apart from a documented initial meeting with Bella’s counsel on October 21, 2014, for such purposes as reviewing the notice correspondence sent by plaintiff counsel and executing a retainer agreement, the Costs Outline mentions only one “Pre-discovery meeting with Job Appiah”, which took place on May 17, 2016. It seems to me that, had similar preparatory meetings taken place prior to each rescheduled examination date, as alleged, the Costs Outline would have mentioned them as well.
• Moreover, it seems to me that many of the store absences and closures alleged by Mr Appiah were a matter of unreasonable choice and preference rather than litigation-caused necessity. In particular:
  • In my view, it was neither necessary nor reasonable for Mr Appiah to meet with his counsel again and again in relation to each scheduled round of oral discovery examinations – if that did indeed happen. The underlying circumstances, fully known to Mr Appiah, involved a situation where Bella had no possible involvement whatsoever with the relevant curling iron, and Bella had been named as a defendant to the litigation simply because of an unfortunate coincidence between its name and the brand name affixed to the curling iron. Mr Appiah and his counsel clearly knew or should have known that reality was never going to change, and that Bella and Appiah accordingly had no information beyond those realities to provide in relation to the litigation. It should not have taken three or more meetings, lasting 45-60 minutes each, to confirm over and over again that Bella and Mr Appiah did nothing and knew nothing relevant to the litigation.
  • Nor was it necessary, in my view, for Mr Appiah to attend the oral discovery examination of HOTLP’s representative in such circumstances. He was free to do so, but the underlying and known reality of Bella having done nothing relevant to the litigation, reinforced by the admissions and acknowledgments pleaded by HOTLP and SDMI, made it abundantly clear that HOTLP’s representative realistically was not going to say anything relating to Bella that could not have been summarized briefly by Bella’s lawyer, who also attended the oral discovery examination of HOTLP’s representative in its entirety. In the circumstances, the suggestion that the plaintiffs were responsible for any closure of Bella’s store that day, and for any corresponding loss of sales income from that closure, seems unreasonable.

[17] Second, as emphasized by plaintiff counsel, the type of mental upset said to have been experienced by Mr Appiah, (i.e., emotional distress, fear and occasional lack of sleep not impairing Mr Appiah’s ability to function, and not requiring any medical treatment, medication or counselling), falls short of the type of “mental injury” for which our courts permissibly may award compensation. Although proof of a recognized psychiatric illness is not required to warrant any such recovery, a claimant must prove that the mental disturbance was serious and prolonged, rising above the ordinary annoyances, anxieties and fears that come with living in a civil society. See Saadati v. Moorhead, 2017 SCC 28, [2017] 1 S.C.R. 543, at paragraph 37. In my view, the evidence of mental disturbance put forward by Mr Appiah does not meet that standard.

[18] Third, the claim for compensation relating to Mr Appiah’s alleged mental distress, fear, and sleeplessness is simply not a claim belonging to any party to this litigation. In particular, Bella, (a corporate entity with a legal personality separate from that of Mr Appiah), was named as a defendant. Mr Appiah was not.

[19] Fourth, (and decisively in my view), Bella never advanced a claim for such types of compensation in this proceeding. In that regard:

• Bella advanced no counterclaim for damages in its pleading, and the relief expressly claimed in Bella’s notice of motion is similarly limited, (beyond the request for summary judgment dismissing the plaintiffs’ claims against Bella), to “costs thrown away and costs of the motion, on a substantial indemnity basis”.
• Bella was not a self-represented litigant, in respect of which our courts have the ability to award, in lieu of costs providing a measure of reimbursement for expense incurred in securing formal legal representation, costs incurred by lay litigants who can demonstrate that they devoted time and energy to do the work ordinarily done by a lawyer retained to conduct the litigation, and that, as a result, they incurred an opportunity cost for foregoing remunerative activity. See Fong v. Chan, 1999 ONCA 2052, [1999] O.J. No. 4600 (C.A.), at paragraph 26; and Izzard v. Goldriech, [2002] O.J. No. 2931 (Div.Ct.), at paragraph 3. At all material times, Bella was formally represented by legal counsel.
• In this case, a claim for costs accordingly is not a vehicle to advance substantive claims for compensation. See Mustang Investigations Inc. v. Ironside, [2009] O.J. No. 3848 (S.C.J.), at paragraph 19, appeal allowed on other grounds set forth in Mustang Investigations Inc. v. Ironside, 2010 ONSC 3444, [2010] O.J. No. 3184 (Div.Ct.).
• In my view, Bella’s claims for compensation beyond reimbursement of its legal expense are in fact claims for damages, and accordingly cannot be permitted in this current context.

[20] Bella’s request for compensation beyond reimbursement of its legal expense accordingly is denied.

[21] In my view, the current dispute accordingly reduces to one concerning Bella’s claim for costs.

Party Positions

[22] In that regard, Bella’s counsel filed a “Costs Outline” indicating that it was seeking a total of $20,666.00 in costs, including:

• $17,675.00 in fees for the action and motion, (not including the appearance before me);
• $2,450.00 in fees for the appearance before me; and
• $541.00 in disbursements.

[23] Plaintiff counsel submitted that Bella should receive no cost award. In the alternative, it was suggested that any cost award in Bella’s favour should be nominal.

[24] Plaintiff counsel confirmed that the plaintiffs were not seeking costs of the action or of the motion.

General Cost Principles

[25] 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”.

[26] This is supplemented by the provisions of Rule 57.01 of the Rules of Civil Procedure, 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.

[27] 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.

[28] 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), 2005 ONCA 1042, 75 O.R. (3d) 638 (C.A.), and Anderson v. St Jude Medical Inc. (2006), 2006 ONSCDC 85158, 264 D.L.R. (4th) 557 (Ont.Div.Ct.).

[29] 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 ONCA 14579, [2004] O.J. No. 2634 (C.A.), at paragraph 26, and Zesta Engineering Ltd. v. Cloutier, 2002 ONCA 25577, [2002] O.J. no. 4495 (C.A.), at paragraph 4.

Bella’s Claim for Costs - Entitlement

[30] Notwithstanding arguments to the contrary, in my view Bella is entitled to an award of costs in relation to the motion and this action.

[31] From a litigation perspective, it may have been reasonable, in the circumstances, for the plaintiffs to name Bella as a defendant to the litigation. In particular:

• the relevant curling iron was purchased in Ontario and bore the name “Bella”;
• curling irons arguably fall within the definition of “beauty supplies”;
• Bella’s name and place of incorporation accordingly suggested to the plaintiffs and/or their counsel that Bella may have had something to do with the relevant curling iron; and
• without any ability to determine with certainty whether or not that was the case, (e.g., by obtaining assurances that were not merely informal but also legally binding) [3], the plaintiffs arguably were prudent to include Bella as a named defendant in the litigation, prior to expiry of the applicable limitation period.

[32] However, the simple truth is that the plaintiffs and/or their counsel were mistaken in thinking Bella had any involvement in the matter, and a party having nothing to do with the relevant curling iron was obliged to deal with a formal claim alleging that it was liable for $1,400,000.00 in damages.

[33] Threatened with default proceedings, Bella arguably was obliged to retain counsel, enter a formal defence, and comply with documentary and oral discovery procedures.

[34] The plaintiffs’ claims against Bella unquestionably lacked merit, were completely unsuccessful, and through this motion have been formally dismissed.

[35] In the circumstances, costs normally should follow the event, with Bella being entitled to its costs of the action and this motion.

[36] Plaintiff counsel suggested two reasons why that should not happen in this case.

[37] First, it was suggested that Bella’s claim for costs had been restricted to costs of its motion, without any request for costs of the action as well.

[38] I disagree.

[39] In its notice of motion dated October 22, 2018, paragraph (b) of the relevant prayer for relief indicated that Bella was seeking “costs thrown away and costs of the motion on a substantial basis”. [Emphasis added.] Although there is no express reference to “costs of the action”, in my view the only sensible interpretation of the notice of motion’s prayer for relief is that Bella was seeking costs in addition to costs of the motion; costs which could only mean costs of the action, which had been “thrown away” from Bella’s perspective.

[40] Second, plaintiff counsel repeatedly asserted, (e.g., in correspondence, during cross-examination of Mr Appiah, in the plaintiffs’ responding motion material, and in oral submissions before me), that Bella should receive no costs because it deliberately failed to refer the matter to its liability insurer. In particular, it was argued:

• that referring the matter to Bella’s insurer would have resulted in the insurer providing Bella with a fully funded defence;
• that Bella itself accordingly would have incurred no legal expense whatsoever in relation to this litigation, had the matter been referred to its insurer;
• that any legal expense incurred by Bella itself accordingly stems from its own business decision; and
• that Bella, in the circumstances, therefore should not be permitted to claim any costs from the plaintiffs.

[41] In my view, such arguments also must be rejected.

[42] Our courts normally decide whether or not to impose litigious burdens on parties according to the laws applicable to all parties, without regard to whether a particular party prudently may have made collateral arrangements to fund such obligations through insurance. In that regard:

• Rules 30.02(3) and 31.06(4) of the Rules of Civil Procedure compel the disclosure of specified insurance information for the limited purpose of assisting parties in making informed and sensible decisions in circumstances where recourse to insurance moneys may play a major role in how the litigation is conducted, and through what stages it should be pursued. See Sabatino v. Gunning (1985), 1985 ONCA 2013, 50 O.R. (2d) 171, at paragraph 11.
• Rules 30.02(3) and 31.06(5) nevertheless make it clear that any such evidence remains inadmissible unless it is relevant to an issue in the action itself; e.g., as it might be when issues of liability and damages are expressly focused on the extent of rights and obligations created by insurance policies.

[43] For such reasons, it is not appropriate to argue that an insured party should be held liable for damages simply because it is insured; i.e., on the basis the party itself will not be out of pocket when its insurer pays such damages.

[44] In my view, it similarly is not appropriate to argue that an insured party should be denied recovery of legal costs simply because it is insured; i.e., on the basis the party itself will not be out of pocket when its insurer pays such costs.

[45] In both cases, whether financial obligations should be incurred by the party exposed to litigation should be decided without regard to collateral arrangements the party may have made to shift the burden of such obligations to its insurer.

[46] Arguments such as those advanced by plaintiff counsel also ignore the reality and impact of an insurer’s rights of subrogation; rights which invariably include the ability of an insurer to step into the shoes of its insured for the purposes of recovering, from an opposing litigant, reimbursement in relation to sums the insurer has spent in providing a defence to its insured.

[47] In such circumstances, it is not accurate to say the insured party has no right to claim costs. The right exists. It is simply assigned to the subrogating insurer.

[48] In this case, for example, Bella’s referral of the plaintiffs’ claim to its insurer for provision of a defence would have had no bearing on the plaintiffs’ obligation to pay adverse costs if their claims against Bella were unsuccessful. The plaintiffs simply would have owed that obligation to Bella’s subrogating insurer – which nevertheless would have claimed such costs in Bella’s name.

[49] In this particular case, Bella decided it would not refer the plaintiffs’ claim to its insurer for the provision of any defence or indemnity.

[50] In my view, that was a decision Bella was entitled to make.

[51] In the circumstances, Bella’s entitlement to costs of a successfully defended claim remained with Bella, without any transfer of that entitlement to an insurer through rights of subrogation.

[52] In short, the existence of Bella’s insurance coverage in no way affects the obligation of the plaintiffs to pay costs of unsuccessful litigation vis-à-vis Bella.

[53] Bella accordingly is entitled to its costs of the motion and of the action.

Scale

[54] As noted above, Bella asked for costs to be awarded “on substantial indemnity basis”.

[55] 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), 1984 ONCA 1862, 45 O.R. (2d) 693 (C.A.).

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

[57] In Young v. Young, 1993 SCC 34, [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”.

[58] In Mortimer v. Cameron (1994), 1994 ONCA 10998, 17 O.R. (3d) 1 (C.A.), and McBride Metal Fabricating Corp. v. H&W Sales Co. (2002), 2002 ONCA 41899, 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.

[59] In my view, there was no evidence, in this case, of any such conduct on the part of the plaintiffs.

[60] In its written and oral submissions, Bella repeatedly argued, in various ways, that the plaintiffs acted unreasonably by naming Bella as a defendant, and by failing to discontinue or otherwise abandon their claim against Bella at any earlier date.

[61] Emphasis was placed on the fact that the claim lacked merit from the outset, given Bella’s lack of involvement in the underlying circumstances, and the reality that the plaintiffs had made mistaken assumptions based on the coincidental overlap between Bella’s name and the brand name on the relevant curling iron.

[62] For the reasons noted above, I think it actually may have been reasonable in the circumstances, from a litigation perspective, for the plaintiffs to have named Bella as a defendant until they were able to secure legally binding confirmations that Bella had no involvement in the matter.

[63] In any case, however, mere adherence to an ultimately unsuccessful position in litigation, and failure to settle, 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 have its position tested by litigation, and there is no obligation to settle.

[64] Bella accordingly is entitled to costs only on a partial indemnity basis.

[65] The more difficult question, in my view, is how those costs should be appropriately quantified.

Quantification

[66] 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 – RULE 57.01(1)(a)

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

[68] In this case, Bella was faced with a formal claim, by the plaintiffs, asserting that Bella was liable for damages totalling $1,400,000.00. In the circumstances, Bella was entitled to take the claim seriously.

[69] Again, by the time the matter came before me, there was no dispute that the claims against Bella had no merit, insofar as Bella had no involvement whatsoever in relation to the relevant curling iron.

[70] The claims against Bella were dismissed in their entirety, without the plaintiffs recovering anything in that regard.

PRINCIPLE OF INDEMNITY – RULE 57.01(1)(0.a)

[71] Rule 57.01(0.a) permits the court to consider, in exercising its cost discretion, “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”.

[72] In the course of making his cost submissions, counsel for Bella tendered a Costs Outline indicating, inter alia, that all legal work done in relation to Bella’s defence was performed by Mr Amissah-Ocran, who was called to the bar in 1998.

[73] Although the “Costs Outline” filed by Bella ostensibly suggested use of a $350 “partial indemnity rate” for Mr Amissah-Ocran, further information in the “Costs Outlined” suggested, (and Bella’s counsel did not dispute), that $350.00 per hour is the actual hourly rate charged by Mr Amissah-Ocran for his time. [4]

[74] For the reasons outlined above, I already have found that an award of substantial indemnity costs is not appropriate. An award of full indemnity costs is even less appropriate.

[75] In my view, $210.00 would be an appropriate partial indemnity hourly rate for Mr Amissah-Ocran’s time.

[76] Plaintiff counsel nevertheless raised other significant concerns about the hours and associated legal expense said to have been devoted to this matter by Mr Amissah-Ocran, and I independently share such concerns.

[77] 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.

[78] 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”.

[79] 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”.

[80] In this particular case, I nevertheless have concerns in that regard.

[81] Before focusing on particular examples fueling such concerns, I think a number of broad observations are in order: i. In my view, the nature of Bella’s defence, in this particular case, was extraordinarily simple, basic and straightforward. In essence it was no more than this: “Despite the coincidence of Bella sharing the same name as the brand applied to the relevant curling iron, Bella has never had anything whatsoever to do with curling irons, you have the wrong defendant, and Bella knows absolutely nothing about the matter.” ii. I think it correspondingly takes, or at least should take, very little time to assert such a defence. iii. Having no involvement in the matter, and the certain knowledge that nothing plaintiffs and co-defendants might produce could alter that reality, inherently should make participation in the discovery process a minimal exercise. In particular, having no involvement whatsoever in a matter means having no relevant documentation, and having no knowledge to review, present or disclose during an oral discovery examination. It takes, or at least should take, in my view, extraordinarily little time to prepare a client for oral discovery examinations who can say little but “I know nothing about this, apart from the fact that Bella never had anything to do with curling irons.”

[82] In short, the simplicity and certainty of Bella’s defence warranted a proportionately minimal response, focused on extricating Bella from the litigation with a minimum of time and expense.

[83] However, that unfortunately is not the approach I see when I have regard to the history of the litigation and the Costs Outlined now filed by Bella.

[84] To cite but some of many possible examples in that regard:

• Given the nature of Bella’s defence, I find it surprising that neither Bella nor its counsel made any attempt whatsoever to provide plaintiff counsel with written confirmation of Bella’s position, and/or request an appropriate waiver of defence until the nature of Bella’s involvement or lack thereof could be confirmed with the other defendants, before Bella proceeded directly with preparation and filing of a formal statement of defence.
• Bella’s Costs Outline suggests that two hours were devoted to reviewing the plaintiffs’ statement of claim, the substantive portions of which total no more than six pages. In my view, that is clearly excess, particularly when read by counsel who knows the nature of Bella’s defence.
• The same Costs Outline suggests that six hours then were spent on fashioning Bella’s statement of defence. In my view, that time was grossly excessive in the circumstances, and the nature of Bella’s defence in particular. As noted above, the substantive portions of Bella’s pleading were no more than 1½ pages long, and even that length was drawn out by Bella using separate paragraphs to deny any involvement in designing, manufacturing, packaging or distributing the curling iron.
• According to Bella’s Costs Outline, a similar six hours were devoted to Bella’s preparation of an Affidavit of Documents, despite the reality, noted above, that Bella effectively was disclosing but one six page document, (i.e., its Articles of Incorporation), not already circulated openly between the parties as part of the proceedings. In other words, Bella’s counsel apparently devoted the bulk of his efforts in that regard to preparing an unnecessary list of all pleadings and non-privileged correspondence already exchanged and disclosed in the litigation. In my view, such an approach is wasteful and not intended by the rules. It certainly does nothing to advance the true purpose of the rules relating to discovery and disclosure, or the aforesaid goals of promoting cost control and proportionality. Taken to its logical extreme, the approach adopted by Bella’s counsel would require all parties to prepare and serve a fresh affidavit of documents each time counsel send or receive an item of non-privileged correspondence letter, regardless of its significance, and/or each time a required notice is served or the court makes an order in the litigation. In my view, that sensibly cannot be what the drafters of Rule 30 intended, having regard to the goals of efficiency, cost reduction and proportionality emphasized elsewhere in the roles.
• Because of the manner in which this matter came before me, I also have the benefit of having, for review, particular items of correspondence cross-referenced in Bella’s Costs Outline; i.e., with indications of the time Bella’s counsel is said to have taken reviewing incoming correspondence, or preparing outgoing correspondence. Once again, such comparisons suggest, in my view, clear excess of time being devoted to this matter. Outgoing correspondence conveying two brief sentences is said to have taken 15 minutes to prepare. Incoming letters with substantive content containing just a few short sentences, about mundane scheduling matters, are said to have been reviewed for 15-30 minutes. Similar time is said to have been devoted to such matters as review of a pro forma notice of examination, and minutes of settlement that did not affect Bella. While each item considered in isolation may entail minimal incremental excess, the cumulative pattern of excess seems unmistakeable, and frankly makes me question the time said to have been devoted to other matters.
• I find it troubling that Bella’s response to correspondence confirming the plaintiffs’ intention not to pursue Bella, and inviting information about costs Bella was seeking, was silence but for the bringing of this summary judgment motion. It demonstrates once again that Bella consistently was inclined to take the most litigious and expensive approach to addressing and resolving this dispute.

[85] As for disbursements, the Costs Outlined provided little or no information, apart from claiming a total sum of $541.00 for “Court Filing Fees, Process Servers, Courier Services, Fax charges, Stationary, Transaction Levy”.

[86] Without further details and itemization, it is difficult if not impossible to be entirely satisfied that there is a reasonable basis for such a claim.

[87] However, as acknowledged by plaintiff counsel, Bella’s filing of a statement of defence and the motion record herein likely entailed respective disbursements of $144.00 and $160.00 respectively, and there no doubt may have been costs incurred in relation to process servers, particularly if that involved travel between Milton and London.

[88] Of course, Bella no doubt also paid applicable taxes on the legal fees and disbursements it incurred as a result of this litigation, although I received no information in that regard either.

REASONABLE EXPECTATIONS OF UNSUCCESSFUL PARTY – RULE 57.01(1)(0.b)

[89] Rule 57.01(1)(0.b) permits the court to consider, in exercising its cost discretion, “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”.

[90] In this case, the plaintiffs chose not to supply me with any information detailing the time and disbursements devoted to the litigation vis-à-vis Bella from their perspective.

[91] As emphasized by such authorities as Smith Estate v. Rotstein, 2011 ONCA 491, [2011] O.J. No. 3075, at paragraphs 50-51, leave to appeal refused, [2011] S.C.C.A. No. 441, and my own comments in Valastro v. The Corporation of the City of London, [2013] O.J. No. 1353, at paragraph 12(b), an unsuccessful party’s failure to supply information concerning its own costs is an important consideration in assessing the parties’ reasonable expectations, and permits an inference that the resources devoted to the matter by the unsuccessful party were comparable to those expended by the successful party.

[92] However, as emphasized by the provisions of Rule 57.01(0.b), viewed in context, the amount of costs that an unsuccessful party could reasonably expect to pay is but one factor to be considered.

[93] Moreover, I do not think the court’s independent obligation to determine what conforms to that “overriding principle of reasonableness” is eliminated or constrained by an unsuccessful party’s failure to tender its own bill of costs, or otherwise supply the court with an indication of the fees the unsuccessful party incurred in dealing with that matter.

APPORTIONMENT OF LIABILITY – RULE 57.01(1)(b)

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

[95] In this particular case, Bella was entirely successful in having the plaintiffs formal claims against it dismissed without any finding of liability or award of damages in relation to Bella.

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

[96] 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”.

[97] For the reasons already outlined above, I think the proceedings as between the plaintiffs and Bella were extraordinarily simple and straightforward. Based on an unfortunate coincidence of names, the plaintiffs mistakenly named Bella as an additional defendant to the proceeding when it actually had no involvement whatsoever with the matter.

[98] In my view, the matter similarly should have been resolved in a similarly simple and straightforward manner.

[99] The particular issues raised by the litigation, insofar as Bella was concerned, had no broader significance or importance.

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

[100] 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”.

[101] 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”.

[102] In that regard, Bella’s counsel emphasized the acknowledged failure of the plaintiffs and their counsel to follow up on the contemplated step of discontinuing the action against Bella, following indications given in that regard in December of 2017.

[103] Although such a failure unquestionably extended the duration of this proceeding, it also seems to have done so without causing Bella to incur any additional expense it otherwise would not have incurred.

[104] Again, Bella was not involved in the active litigation which took place thereafter, between the plaintiffs and Bella’s co-defendants. Moreover, as Bella’s counsel acknowledged, neither he nor Bella took any steps to move the matter forward after December of 2016, or do anything but simply wait on the plaintiffs and their counsel to take further action.

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

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

[106] As noted above, it was argued that the plaintiffs should have released Bella from this litigation long before oral discovery examination of Bella’s co-defendants. However, for the reasons already outlined above, I do not think the plaintiffs acted unreasonably, having regard to all the circumstances.

[107] As also noted above, there is no obligation to settle, and the plaintiffs were entitled to have their claims explored and tested by the litigation process.

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

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

[109] In that regard, the Costs Outline filed by Bella includes a claim for 7 hours of motion preparation at a cost of $2,450.00 and 2.5 hours of attendance for the cross-examination of Mr Appiah on his supporting affidavit at a cost of $875.00 – although I note again that both figures apparently represent a claim for full indemnity costs, which is not appropriate in the circumstances.

[110] As noted above, Bella’s counsel sought an appearance fee of $2,450.00 for the hearing of the motion – presumably on the same inappropriate full indemnity basis.

[111] Beyond the inappropriate scale of such cost requests, in my view the sums sought are far beyond the amount of costs usually awarded in relation to what is, in itself, a hearing essentially focused on little more than the fixing of appropriate costs.

Conclusion

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

[113] 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.

[114] In this instance, the overall impression left from a review of all the above considerations is that Bella, mistakenly and therefore unjustly targeted as a defendant in these proceedings, regrettably then viewed the circumstances, and its justifiably firm expectation it inevitably would succeed in having the claims against it dismissed, as a reason for casting aside any concern for appropriate efficiency and reasonable proportionality, thinking that the plaintiffs eventually would be obliged to pay for such excess.

[115] As emphasized in the oft-quoted remarks of Justice Killeen in Pagnotta v. Brown, [2002] O.J. No. 3033 (S.C.J.), a “losing party is not to be treated as a money tree to be plucked willy-nilly by the winner of the contest”.

[116] In my view, Bella’s approach to this matter sadly suggests it felt such a tree had been planted in its yard by virtue of this litigation.

[117] 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 Bella its costs of the action and of this motion fixed in the all-inclusive amount of $3,000.00.

[118] An order shall go accordingly.

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

Date: March 8, 2019

Footnotes

[1] I note in passing that this is the last indication, in the motion material I received, about any further litigation activity vis-à-vis the “John Doe Chinese Corporation” defendant. Although named a defendant as a precautionary measure, the unknown corporation apparently was never identified, served, or made the subject of further proceedings. To the extent the plaintiffs’ formal claim against it survives, (as the judgments and orders referred to below do not reflect it), it is a claim in which no one appears to have any further interest. At some point, it hopefully will be formally dismissed so that this action does not remain an “open file” on the court’s docket.

[2] During oral submissions, Bella’s counsel indicated that he had asked only a “couple of questions”. In later submissions by plaintiff counsel, (which Bella’s counsel did not contradict), it was noted that Bella’s counsel actually asked six questions, which – along with the answers given in response - nevertheless occupied no more than 1½ pages of a 112 page transcript prepared in relation to the relevant examination.

[3] In his sworn evidence, Mr Appiah emphasized that he was upset and frustrated by the plaintiffs’ refusal to accept informal or pleaded assurances that Bella had nothing to do with the matter, and Bella’s counsel faulted the plaintiffs and their counsel for the same reason in the course of oral submissions. However, informal and pleaded pro forma denials by defendants who later concede liability are common in modern litigation. Premature acceptance of such informal denials, together with the operation of limitation periods, accordingly may lead to claimants being denied recovery. In my view, it accordingly was not unreasonable for the plaintiffs and their counsel to press on despite the non-binding assurances being made on behalf of Bella or its co-defendants.

[4] In particular, the “Cost Outline” filed by Bella indicates that the “Actual Rate” fees charged to Bella, for 50.5 hours of legal work, came to $17,675.00. Simple mathematics, (i.e., $17,675.00 divided by 50.5 hours), confirms that Mr Amissah-Ocran’s actual hourly rate must be $350.00.