COURT FILE NO.: 16-67707 DATE: 2019/03/25 ONTARIO SUPERIOR COURT OF JUSTICE
B E T W E E N:
TRUESTAR INVESTMENTS LTD. Plaintiff – and – IRIS BAER and JOHN JOSEPH CASSIDY Defendants
Michael Hebert, for the plaintiff corporation Ryan Garrett, for the defendant, Iris Baer and for the non-party, 1245906 Ontario Inc. No one appearing for the defendant, Joseph Cassidy
HEARD: In Writing
COSTS ENDORSEMENT
Corthorn J.
Introduction
[1] The plaintiff corporation (“Truestar”) was entirely successful in this action, including on a motion for summary judgment. Of the two defendants, only Iris Baer (“Baer”) responded to the motion.
[2] Truestar seeks its costs of the action on a partial indemnity basis. Baer does not dispute that Truestar is entitled to its costs of the action on that scale. The only issue to be determined is the amount at which Truestar’s costs are fixed.
[3] Truestar seeks costs on a partial indemnity basis of $28,908.11. Baer’s position is that the costs claimed are high for a matter that was of average complexity. She submits that reasonable partial indemnity costs in the circumstances would be $16,500, inclusive of all fees, disbursements, and HST.
Disposition
[4] For the reasons that follow, Truestar’s partial indemnity costs on the motion are fixed at $28,900 (all-inclusive).
Costs Claimed
[5] The partial indemnity costs claimed by Truestar are broken down as follows:
| Item | Amount |
|---|---|
| Fees | $ 20,307.32 |
| Counsel fee (two appearances) | $ 1,755.00 |
| Disbursements | $ 3,593.44 |
| HST (fees and disbursements, the latter where applicable) | $ 3,252.35 |
| Total | $ 28,908.11 |
Rule 57.01(1) Factors
[6] The factors set out in r. 57.01(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, are considered below.
a) The principle of indemnity (r. 57.01(1)(o.a))
[7] Truestar and Baer are in agreement that, as the successful litigant, Truestar is entitled to its costs of the action. Truestar’s success in the action includes the findings made that the impugned transfers of property were (a) fraudulent, and (b) intended to defeat the creditors of the Bankrupt. The Bankrupt is not one of the parties to this action.
b) Reasonable expectations of unsuccessful party (r. 57.01(1)(o.b))
[8] The partial indemnity costs incurred by Baer total $17,336.80. That amount includes $16,563.88 (fees and HST) plus $945.86 for disbursements (inclusive of HST). The total for fees and HST is based on work done by Baer’s counsel, who was called to the bar in 2010. As of 2018, when the motion for summary judgment was heard, the full indemnity hourly rate for Baer’s counsel was $340. His partial indemnity hourly rate was $200.
[9] Truestar is represented by senior counsel (39 years at the bar, as of 2018) and associate counsel (17 years at the bar). Their respective full indemnity hourly rates are $450 and $330; their respective partial indemnity hourly rates are $292.50 and $214.50. The hourly rates charged by Truestar’s counsel are reasonable—whether considered in isolation of or when measured against the hourly rate charged by Baer’s counsel.
[10] I find it reasonable that Truestar would, in the circumstances of this matter, rely on senior counsel. Truestar was seeking to recover parcels of land (valued at a moderate, six-figure amount) as payment towards a debt upon which it would otherwise not realize.
[11] It is reasonable for a responding party to expect that the moving party (in an action or on a motion) would incur costs at least as great as those incurred by the responding party.
[12] The disparity between the partial indemnity costs incurred by Baer and those incurred by Truestar is explained by (a) the difference in level of experience of counsel, and (b) the additional work required on behalf of Truestar as the plaintiff and as the moving party on the motion for summary judgment.
[13] I find that the costs incurred by Truestar are in keeping with the reasonable expectations of the opposing party.
c) The amount claimed and the amount recovered in the proceeding (r. 57.01(1)(a))
[14] The matter involves ownership of six parcels of land (divided into two groups of properties). Baer submits that the total value of the properties is $220,000. The actual value of any one of the six properties is not significant. What is significant, however, is that Truestar was entirely successful in that the transfers of all six impugned properties were set aside.
d) Complexity of the proceeding (r. 57.01(1)(c))
[15] Truestar describes the proceeding as “somewhat” complex. Baer submits that the proceeding was of “average” complexity. I find that the partial indemnity costs claimed are in keeping with the complexity of the matter.
e) The importance of the issues (r. 57.01(1)(d))
[16] As noted in paragraph 14, above, setting aside the property transfers is significant in the context of the related bankruptcy proceeding. The properties now fall within the scope of the Bankrupt’s assets and are available for the purpose of payment of creditors, including Truestar. (Note: I make no finding in the context of this action as to which of the Bankrupt’s creditors is entitled to benefit from the result in this action. That issue is not before the court.)
f) The conduct of the parties (r. 57.01(1)(e))
[17] Truestar points to Baer’s late delivery of her affidavit on the motion as resulting in increased costs to Truestar. The written submissions received on behalf of Truestar are lacking, however, in linking the late delivery of that affidavit to increased costs incurred. As a result, I do not consider the timing of delivery of that affidavit as a factor relevant to fixing costs.
[18] Baer’s conduct in terms of presentation of argument on the motion is, however, relevant to fixing costs. It was not until oral argument on the motion that Baer raised, for the first time, an argument that necessitated (a) service of the motion documents on a numbered company of which Baer is a principal, and (b) providing the numbered company with an opportunity to respond to the motion for summary judgment. As a result (a) two separate appearances were required for argument on the motion, and (b) Truestar’s counsel was required to prepare for two appearances instead of one appearance.
[19] Once served with the motion documents, the numbered company (a) did not deliver any responding materials, (b) was represented by Baer’s counsel, and (c) chose to rely on the responding motion record previously delivered by Baer.
[20] I find that Baer’s conduct in terms of the timing of the argument raised resulted in the motion being lengthened unnecessarily. If there is any duplication of effort by Truestar’s counsel in having to prepare twice to make argument on the motion, Baer is solely responsible for that duplication. In any event, I find that both the time identified for preparation for the motion and the counsel fee are reasonable.
Discussion
[21] The number of hours docketed by Truestar’s counsel is only slightly greater than the number of hours docketed by Baer’s counsel. The difference in the dollar value associated with their work stems from the difference in hourly rates. As noted above, that difference arises from the difference in years of experience. I find that the time docketed for the work done is reasonable.
[22] I have reviewed the itemized list of disbursements included in Truestar’s bill of costs. No item stands out as either excessive or unreasonable.
[23] In summary, I find that the costs claimed by Truestar are reasonable. I round the amount of costs payable from the total claimed to $28,900.
The Costs Submissions
[24] Truestar requests costs of $2,500 (all-inclusive) for preparation of its costs submissions. No breakdown as between fees and disbursements is provided in support of the $2,500 figure. In the circumstances, I award Truestar $1,750 all-inclusive for costs submissions.
Summary
[25] I order as follows:
- The defendant, Iris Baer shall pay to the plaintiff corporation its costs of the action on a partial indemnity basis in the amount of $28,900 (inclusive of fees, disbursements, and applicable HST).
- The defendant, Iris Baer, shall pay to the plaintiff corporation, the sum of $1,750 (inclusive of fees, disbursements, and applicable HST) for its costs with respect to costs submissions.