Court File and Parties

COURT FILE NO.: CV-12-17981 DATE: 20190501 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

MIHAIL KOLOSOV, ANDREI KOLOSOV, also known as ANDREI KOLASAU, and ALENA KOLASAVA Plaintiffs – and – LOWE’S COMPANIES INC., LOWE’S COMPANIES CANADA, ULC, ANDREW J. FRALICK, JOSEPH THOMAS GERALD HOWARD, STEVEN S. BOYLE, CASEY FINDLAY, WINDSOR POLICE SERVICES BOARD, GARY SMITH, Former Chief of Windsor Police Services, DETECTIVE KEVIN MCCANN, POLICE CONSTABLE STEVEN BRNARDIC, POLICE CONSTABLE JACQUELINE KHOURY, STAFF SGT. ALAN BROWN, BELLEVILLE POLICE SERVICE BOARD, CORY MCMULLAN, Chief of Belleville Police Services, CONSTABLE RON KANYO, CONSTABLE JEFF LING, DETECTIVE CONSTABLE PAUL JOSEFIK and HER MAJESTY THE QUEEN IN RIGHT OF THE PROVINCE OF ONTARIO AS REPRESENTED BY THE ATTORNEY GENERAL OF ONTARIO Defendants

COUNSEL: Raymond G. Colautti, for the Plaintiffs Tom Galligan, for the Defendants, Lowe’s Companies Inc.; Lowe’s Companies Canada; ULC; Andrew J. Fralick; Joseph Thomas Gerald Howard; Steven S. Boyle and Casey Findlay Sheila C. Handler, for the Defendants, Windsor Police Services Board; Gary Smith, former Chief of Windsor Police Services; Detective Kevin McCann; Police Constable Steven Brnardic; Police Constable Jacqueline Khoury and Staff Sgt. Alan Brown

HEARD: Written Submissions

ENDORSEMENT ON COSTS

Verbeem J.

Background

[1] Below, I will provide a basic overview of the nature and conduct of the action to which this costs endorsement relates. For full context in that regard, reference to my written reasons allowing the summary judgment motions of the Lowe’s and Windsor Police defendants, reported at 2018 ONSC 7541, is encouraged.

[2] In this action, the plaintiffs sought damages in excess of $2,000,000 in consequence of certain tortious and Charter infringing conduct that they alleged certain members of the Windsor Police Service (“WPS”) engaged, in relation to the arrest and detention of the plaintiffs, Mihail Kolosov and Andrei Kolosov, on March 13, 2010 and the conduct of a criminal investigation that followed. The asserted criminality related to the plaintiffs’ attempted pick up of merchandise purchased through fraudulent credit card orders that were placed with a Lowe’s retail store in Windsor, Ontario.

[3] The plaintiffs also sought damages in excess of $2,000,000 against Lowe’s and various of its employees, based on allegations, among other things, that those defendants were negligent in the manner in which they: followed (or failed to follow) Lowe’s own internal loss prevention policies; conducted Lowe’s internal investigations into certain fraudulent credit card orders; and shared (or did not share) relevant information with police.

[4] The plaintiffs were charged by the WPS in relation to fraudulently placed orders they attempted to pick up from the Windsor Lowe’s location on March 13, 2010. Those orders were part of a larger pattern of similar fraudulent orders that had been placed with Lowe’s, both at its Windsor and Belleville locations, in early March 2010. Mihail Kolosov picked up merchandise associated with some prior fraudulent orders placed at the Belleville Lowe’s location on two distinct occasions, on one of which he was accompanied by Andrei Kolosov. As a result of their involvement with those orders, Mihail Kolosov and Andrei Kolosov were also arrested and criminally charged by the Belleville Police Service (“BPS”), which together with certain of its members, were also named as defendants in this action.

[5] Eventually, the charges brought by both the WPS and the BPS were withdrawn. Mihail Kolosov and Andrei Kolosov have consistently maintained their innocence throughout. They contend that they were unwittingly conscripted to pick up the merchandise associated with the subject fraudulent orders by the same person that sought to defraud Lowe’s, with no knowledge of the manner by which the orders had been placed.

[6] In the context of this action, all of the defendants denied liability. The police defendants maintained that they consistently held reasonable and probable grounds to arrest and charge Mihail Kolosov and Andrei Kolosov and that their respective investigations were conducted reasonably. The Lowe’s defendants, among other things, posited that they did not owe the plaintiffs a duty of care in relation to the conduct forming the subject matter of the claims against them.

[7] Substantial documentary productions were made in the course of the action. Examinations for Discovery took place over several days, in various municipalities.

[8] Eventually, the Belleville defendants brought a motion for summary judgment, which I allowed, for reasons reported at 2016 ONSC 1661, aff’d 2016 ONCA 973. Subsequent to the dismissal of the action against the Belleville defendants, the WPS and Lowe’s defendants also brought motions for summary judgment. Most of the deponents of the affidavits adduced on those motions were cross-examined, a process that unfolded over the course of seven non-consecutive days, again in various municipalities.

[9] For written reasons dated December 18, 2018, I allowed the motions for summary judgment brought by the WPS defendants that remained in the action (namely, Windsor Police Services Board, Detective Kevin McCann, Police Constable Steven Brnardic, and Police Constable Jacqueline Khoury) and the Lowe’s defendants (namely, Lowe’s Companies Inc., Lowe’s Companies Canada, ULC, Andrew J. Fralick, Joseph Thomas Gerald Howard, Steven S. Boyle and Casey Findlay) and dismissed the action accordingly. Through those reasons, I also determined motions to strike certain affidavit evidence filed by the plaintiffs in response to the summary judgment motions.

[10] On dismissal of the action against the WPS and Lowe’s defendants, I invited written submissions with respect to the costs of the motions and the action. I have now received those written submissions, which I will summarize below. The reasons for my costs disposition will follow, thereafter.

The Position of the WPS Defendants

[11] The WPS defendants seek costs for the entire action (including costs related to the summary judgment motion and the related motion to strike) in the total sum of $125,000 inclusive of disbursements and HST. In support, they have filed, among other things: a detailed bill of costs; a fulsome disbursement list; a copy of an offer to settle; detailed written submissions; a book of case law authorities; and a summary of the hours expended and the rates charged by various members of the law firm representing the WPS defendants in the action.

[12] The WPS defendants disclose that they have spent a total of $139,456.84 (inclusive of fees, HST and disbursements) to defend the action, dating back to its inception in June 2012.

[13] The WPS defendants submit that the litigation, which spanned more than six years, was of moderate complexity and involved several parties and voluminous materials. The action was important to both the plaintiffs and the WPS defendants, the latter of whom were alleged to have engaged in misconduct while discharging their duties as police officers. The WPS defendants were completely successful in their defence of the action and their summary judgment motion.

[14] The WPS defendants contend that they made a reasonable offer to settle the action against them. Specifically, following the Belleville defendants’ successful summary judgment motion, the WPS defendants served an offer to settle the proceeding on the basis of a dismissal of the action against them on a without costs basis which, by its terms, remained open for acceptance until five minutes after the commencement of trial. The offer was never withdrawn nor was it accepted by the plaintiffs.

[15] The WPS defendants assert that following the dismissal of the action against the Belleville defendants, the plaintiffs ought to have been aware of the risks that they inherently faced in continuing their action against the WPS defendants, both on the merits and on the issue of costs. Indeed, the plaintiffs were previously ordered to pay the Belleville defendants’ costs fixed in the all-inclusive amount of $47,801.47, when the action was dismissed against them. The WPS defendants assert that in the context of that costs award, the plaintiffs ought to have appreciated that the WPS defendants’ offer to consent to a dismissal on a without costs basis reflected a significant compromise.

[16] Instead, the WPS and Lowe’s summary judgment motions were heard over the course of two days with additional written submissions filed thereafter. The motion records and compendiums filed in relation to those motions totaled in the thousands of pages. Included within the record was an affidavit sworn by J.J. Avery, the plaintiffs’ former criminal counsel. Both the Lowe’s defendants and the WPS defendants successfully moved to strike a significant portion of the content of Ms. Avery’s affidavit evidence. The WPS defendants submit that the plaintiffs’ attempt to adduce that affidavit was unreasonable because the content of a similar affidavit (also sworn by Ms. Avery), filed in response to the Belleville defendants’ motion for summary judgment, was previously struck.

The Position of the Lowe’s Defendants

[17] In support of their position with respect to costs, the Lowe’s defendants delivered written submissions on the issue, together with: a costs outline; detailed line-itemized time entries evidencing the amount of time spent by members of the firm defending them in the action; an itemized accounting of disbursements claimed; and copies of the case law authorities upon which they rely.

[18] The Lowe’s defendants’ costs outline reveals that they incurred a total of $234,260.02 on account of fees and HST, and a total of $8,436.83 on account of disbursements and HST in defence of the action. On a partial indemnity basis they claim a total of $169,579.07 (comprised of: fees of $142,603.75; HST of $18,538.49; and disbursements of $8,436.83).

[19] In support of their position on entitlement and quantum, the Lowe’s defendants submit as follows:

1. The action was commenced in June 2012 and finally dismissed, as a whole, on December 18, 2018, six and one-half years after its inception.
2. The plaintiffs claimed against 17 entities, six of which were “Lowe’s” related, including two companies and four individuals. Examinations for discovery were conducted varyingly in Windsor, Belleville and Toronto, over the course of at least five days, together with additional written interrogatories.
3. In late 2014, Lowe’s counsel advised the other parties that the Lowe’s defendants intended to bring a motion for summary judgment. Lowe’s counsel proposed that since each of the three sets of defendants (Belleville, Lowe’s and WPS) intended to bring a motion for summary judgment, dates should be scheduled for a common hearing. In response, plaintiffs’ counsel advised that he would not consent to an adjournment of the then pending Belleville defendants’ summary judgment motion (scheduled for May 2015) to accommodate a common hearing, despite also positing that issues related to vicarious liability and applicable limitation periods that affected the Lowe’s defendants would be determined in the context of the Belleville summary judgment motion. As a result, Lowe’s counsel was required to appear at the Belleville defendants’ motion, which was argued over two days.
4. Lowe’s counsel asserts that the plaintiffs engaged in conduct that unnecessarily lengthened the proceeding. For example, when the court provided the parties with various dates for a two-day hearing of the anticipated Lowe’s and WPS defendants’ summary judgment motions, plaintiffs’ counsel advised that he was only available for two of the dates offered. Through subsequent correspondence, he withdrew his consent to those dates, but provided no further input with respect to his availability for the anticipated summary judgment motions. Then, plaintiffs’ counsel posited that the summary judgment motions of the Lowe’s and WPS defendants ought not proceed until the plaintiffs’ appeal against the dismissal of the action against the Belleville defendants was determined. The appeal was dismissed on December 12, 2016 and reasons followed on December 29, 2016. Next, on February 27, 2017, at a case conference held before me, the court offered dates for the hearing of the Lowe’s and WPS defendants’ summary judgment motions on May 26 and 27, 2017. Plaintiffs’ counsel was not available. Several other dates were offered. Plaintiffs’ counsel was only available for the latest dates offered, October 30 and 31, 2017. A timetable for the pre-hearing conduct of the motions was endorsed and required the parties to, among other things, complete cross-examinations by September 15, 2017 and deliver facta by October 20, 2017. I also endorsed that the plaintiffs were required to deliver responding material by June 30, 2017. Contrary to the timetable, the plaintiffs did not deliver their responding materials until September of 2017. With the timetable frustrated, the motions were ultimately adjourned.
5. In the context of the Lowe’s and WPS defendants’ motions for summary judgment, the plaintiffs cross-examined 13 witnesses over the course of seven days (two days in Windsor, one day in London, two days in Toronto and two days in Belleville). The Lowe’s defendants submit that an inference can be drawn that the plaintiffs achieved no benefit from those cross-examinations, because a certificate respecting evidence filed by the plaintiffs with the Court of Appeal (apparently in relation to an appeal against my order dismissing the action against the WPS and Lowe’s defendants) confirms that the evidence given at the cross-examinations conducted by plaintiffs’ counsel need not be included in the appeal record.
6. The plaintiffs ought not to be surprised by the quantum of costs claimed by the Lowe’s defendants. The plaintiffs took an aggressive approach throughout the litigation and resisted attempts to streamline the process of arguing the summary judgment motions and specifically, having all three defendant groups’ motions heard at the same time. Further, notwithstanding the court’s determination that several aspects of Ms. Avery’s affidavit evidence delivered in the context of the Belleville defendants’ summary judgment motion were inadmissible, the plaintiffs filed another affidavit from Ms. Avery of similar ilk, which was largely found to be inadmissible in the context of the Lowe’s and WPS defendants’ motions. In addition, before they embarked on their defence of the Lowe’s defendants’ motion for summary judgment, the plaintiffs were aware that the Belleville defendants had sought $125,000 in costs, as a consequence of the action being dismissed against them.
7. The plaintiffs “lost” on every aspect of their claim against the Lowe’s defendants.
8. The plaintiffs adduced evidence in the context of the Avery affidavit that Ms. Avery admitted, on cross-examination, was untrue.
9. In their costs submissions, the plaintiffs submit they are impecunious or of “modest means”. The Lowe’s defendants correctly observe that in determining the quantum of costs awarded to the Belleville defendants, I concluded, in the face of a similar submission made by the plaintiffs, that they were obligated to prove their impecuniosity and had failed to do so. In that context, the Lowe’s defendants submit that this court should take a very hard look at claims of impecuniosity, especially unproven ones that are made in an attempt to reduce the costs that an unsuccessful party might otherwise pay: see Greenhalgh v. Douro-Dummer (Township), 2011 ONSC 2064, [2011] O.J. No. 1657, at paras. 35 and 36; and Myers v. Metropolitan Toronto (Municipality) Chief of Police, [1995] O.J. No. 1321 (Div. Ct.).
10. The plaintiffs made serious allegations against the Lowe’s defendants and ought reasonably to have expected that in the event that they were unsuccessful, a substantial costs award would be imposed against them.
11. The only relevant offer to settle was made by the plaintiffs on May 17, 2013, through which they offered to settle the action for payment of $295,000 inclusive of damages and interest, plus disbursements and costs. However, the offer also provided that if it was not accepted within 10 days, the defendants would be required to pay a total of $325,000 inclusive of damages and interest and costs to the plaintiff on a substantial indemnity basis. The offer was never amended or withdrawn. The Lowe’s defendants posit that, in the absence of proving misconduct or other improper actions on the part of some or all of the defendants, the plaintiffs would not have been entitled to costs on that scale.

[20] In the context of the foregoing, the Lowe’s defendants submit that the quantum of partial indemnity costs requested by them is reasonable and was within the plaintiffs’ reasonable contemplation, particularly as this was a long and difficult action. The length of the proceeding and its difficulty were exacerbated by the plaintiffs’ own conduct throughout. There is no evidence before the court to support the plaintiffs’ claim that they are impecunious. As a result, the Lowe’s defendants submit that an award of costs in accordance with its costs outline ought to be made.

The Position of the Plaintiffs

[21] Based on submissions that I will outline below, the plaintiffs contend that if they are ordered to pay costs in the amounts sought by the respective defendant groups ($125,000 by the WPS defendants and $169,579.07 by the Lowe’s defendants) they will be forced into bankruptcy. In turn, they submit that the amounts for costs claimed by the defendants, respectively, are unreasonable. Reasonably, costs should be fixed, in the amount of $50,000, consistent with the previous order of costs in favour of the Belleville defendants.

[22] In support of their position, the plaintiffs advance submissions similar to those that they made in the context of the determination of the Belleville defendants’ costs claim, specifically:

1. They are impecunious (see paragraph 1 of the Plaintiffs’ Costs Submissions) or alternatively, a family of modest means.
2. “Access to justice” considerations warrant placing the plaintiffs (who submit they are akin to “pro bono” litigants because they are of limited means and they are represented pursuant to a contingency fee agreement) in a more favourable position with respect to the issue of costs, particularly given the “important public issues remaining in the litigation”: see paragraphs 3, 4, 5, 8 and 11 of the Plaintiffs’ Costs Submissions.
3. In this instance, costs should be utilized as an “instrument of policy” to make Charter-based litigation accessible to ordinary citizens.
4. The costs sought by the WPS and Lowe’s defendants markedly exceed an amount that is “fair and reasonable” for the unsuccessful parties to pay in this particular proceeding.

[23] In the context of the foregoing submissions, I turn to a consideration and an application of the relevant legal principles.

APPLICABLE LEGAL PRINCIPLES

[24] The following principles are applicable to issues before me.

[25] An order of costs is discretionary. Section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43, as amended, provides:

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] The discretion to award costs must be exercised in accordance with the facts and circumstances of the case and in accordance with the factors set out in rule 57.01(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (the “Rules”): see Andersen v. St. Jude Medical Inc. (2006), 264 D.L.R. (4th) 557 (Ont. Div. Ct.), at para. 22, leave to appeal refused, 2006 CarswellOnt 7749 (C.A.).

[27] Rule 57.01(1) of the Rules sets out the factors which may be considered by a court when exercising its discretion under s. 131 of the Courts of Justice Act, and specifically provides:

In exercising its discretion under section 131 of the Courts of Justice Act to award costs, the court may consider, in addition to the result in the proceeding and any offer to settle or to contribute made in writing,

(0.a) 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;

(0.b) 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;

(a) the amount claimed and the amount recovered in the proceeding;

(b) the apportionment of liability;

(c) the complexity of the proceeding;

(d) the importance of the issues;

(e) the conduct of any party that tended to shorten or to lengthen unnecessarily the duration of the proceeding;

(f) whether any step in the proceeding was,

(i) improper, vexatious or unnecessary, or

(ii) taken through negligence, mistake or excessive caution;

(g) a party’s denial of or refusal to admit anything that should have been admitted;

(h) whether it is appropriate to award any costs or more than one set of costs where a party,

(i) commenced separate proceedings for claims that should have been made in one proceeding, or

(ii) in defending a proceeding separated unnecessarily from another party in the same interest or defended by a different lawyer; and

(i) any other matter relevant to the question of costs.

[28] A successful party does not have a right to costs but it does have a reasonable expectation that a costs award will be made in its favour. Normally, costs follow the event and are awarded on a partial indemnity basis payable forthwith (within 30 days). Discretion can be exercised in exceptional circumstances to depart from any of those “norms”: see DUCA Financial Services Credit Union Ltd. v. Bozzo, 2010 ONSC 4601, at para. 5; and Yelda v. Vu, 2013 ONSC 5903, at para. 11, leave to appeal refused, 2014 ONCA 353.

[29] Fixing costs is not a “mechanical” exercise. A consideration of experience, rates charged and hours spent is appropriate, but is subject to the overriding principle of “reasonableness” as applied to the factual matrix of the particular case, with a view to balancing “compensation of the successful party” with “the goal of fostering access to justice”: see Boucher v. Public Accountants Council (Ontario) (2004), 71 O.R. (3d) 291 (C.A.).

[30] The quantum awarded should reflect an amount that the court considers to be fair and reasonable within the factual matrix of the particular case rather than a precise measure of the actual costs of the successful litigant: see Zesta Engineering Ltd. v. Cloutier (2002), 21 C.C.E.L. (3d) 161 (Ont. C.A.), at para. 4.

[31] An unsuccessful party’s impecuniosity is one of the factors that the court may consider when exercising its discretion to award and fix costs. The relevant principles in that regard are set out by Chapnik J. in Pilotte v. Gilbert, 2016 ONSC 1334 27 C.C.L.T. (4th) 137, at paras. 10-11, as follows:

Under Rule 57.01(1)(i), the court may consider "any other matter relevant to the question of costs." This includes a party's financial position or situation of hardship. While impecuniosity and hardship should not eliminate or reduce a party's liability for costs, it is one of the factors the court may consider in exercising its discretion under s. 131 of the Courts of Justice Act in determining a reasonable amount of costs: see Balasundaram v. Alex Irvine Motors Ltd., 2012 ONSC 5840, at para. 14; Walsh v. 1124660 Ontario Limited at paras. 15-20; Agius v. Home Depot Holdings Inc., 2011 ONSC 5272.

At the same time, there are other cases where hardship or impecuniosity have not been held to be relevant. Indeed, Lauwers J. in Greenhalgh v. Doura-Dummer (Township), [2011] O.J. No. 1675 (S.C.), at para. 36 referenced, “the problem posed for the system of justice if the costs disincentive established by the Rules were to be displaced by a rule that routinely advantaged a party's hardship in the exercise of judicial discretion over costs.”

The Principles Applied

[32] Absent a compelling reason, costs should follow the event. Although the WPS defendants and the Lowe’s defendants do not enjoy a right to costs, as the successful parties (both in the action and their respective summary judgment motions), they have a reasonable expectation that costs will be awarded in their favour and the award will be payable within 30 days. As stated above, the plaintiffs assert that there are several compelling reasons to depart from a “normative costs award” in this instance, which I will now address.

(i) The Plaintiffs as Public Interest Litigants (akin to pro bono litigants)

[33] The operable circumstances of this aspect of the plaintiffs’ position remain the same as they were when they advance this argument in the context of the determination of costs following the dismissal of the action against the Belleville defendants. For reasons expressed in paras. 38 – 47, inclusive, of my endorsement relating to the Belleville defendants’ costs, cited as 2016 ONSC 4799, I explained why the plaintiffs ought not to be viewed as being analogous to “public interest litigants” for the purpose of determining the costs issues before me at that time. For the sake of convenience, I will reproduce those paragraphs below:

The plaintiffs submit that the court should view them as “pro bono” litigants and that it should fashion a costs award accordingly. Notably, they concede that their counsel is not representing them pursuant to a pro bono retainer. Rather, the plaintiffs disclose that their counsel is acting pursuant to a contingency fee agreement, “which provides for payment of legal fees only in the event of success.” The plaintiffs offer to provide a copy of the retainer fee to the court for inspection, on “a confidential basis”, if required. Such production is not necessary to determine the issues before me.

The plaintiffs submit that the following circumstances justify their request to be viewed as pro bono litigants in the context of the determination of the Belleville defendants’ costs request. First, they say they are either “impecunious” or “of modest means.” Second, they are represented pursuant to a contingency fee arrangement. Third, they posit that their claim involves “important public issues.” As a result, relying on 1465778 Ontario Inc. v. 1122077 Ontario Ltd., they say that in their role as pro bono litigants, by analogy, they should be afforded a more favourable position in the disposition of the costs claim in order to further the objective of access to justice.

I do not accept the plaintiffs’ position that costs should be determined on the basis that they are analogous to pro bono litigants involved in pro bono public interest litigation, for the following reasons.

First, the plaintiffs are not pro bono litigants. Pro bono services are offered, without an expectation of remuneration, to parties that cannot afford a lawyer, in an effort to increase access to justice. Pro bono services are distinguishable from contingency fee based services, where the cost of legal representation is typically funded through a predetermined percentage share of a monetary result, in the event of success. While lacking the charitable motivation underwriting pro bono services, contingency fee retainers are also an effective method of furthering access to justice but they do not immunize unsuccessful litigants against an award of costs: see 1465778 Ontario Inc. v. 11 22077 Ontario Ltd., at para. 17.

Second, in furtherance of their “pro bono litigants by analogy” position, the plaintiffs urge me to consider the nature of their contingency fee arrangement as a factor in determining the costs issues related to the Belleville defendants. However, the relevant provisions of the Solicitors Act, R.S.O. 1990, c. S.15, mandate that the existence of a contingency fee arrangement, generally, ought not to influence an award of costs that would otherwise be made against a client who is a party to such an arrangement.

In that regard, s. 20(1) of the Solicitors Act provides that an agreement between a solicitor and client respecting the amount and manner of payment for the former’s services, including a contingency agreement, does not affect the amount, or any right or remedy for the recovery, of any costs recoverable from the client by any other person, who may require any costs recoverable from the client to be assessed in the ordinary manner. Section 20.1(1) of the Solicitors Act provides that in determining the quantum of costs for the purpose of making a costs award, a court shall not reduce the amount of costs payable only because the client’s solicitor is being compensated in accordance with a contingency fee agreement.

In my view, the foregoing provisions of the Solicitors Act are inconsistent with the plaintiffs’ submission that they are entitled to more favourable treatment on the issue of costs because their counsel is acting pursuant to a contingency fee agreement.

Third, given the nature of the plaintiffs’ claims, I do not find them to be “public interest litigants”, as they assert. They are not litigants without a direct pecuniary or other material interest in the proceeding and they are not litigants whose pecuniary interest in the proceeding is modest in comparison to its costs: see Odhavji Estate v. Woodhouse, 2003 SCC 69, [2003] 3 S.C.R. 263, at para. 76. They do not seek a broad public law remedy. Instead, against the Belleville defendants they pursued, and against the remaining defendants they continue to pursue, a claim for remedial damages in excess of $2,000,000 on account of causes of action, which are all unique to their own private interests.

While some public utility is derived from holding state actors accountable when they engage in tortious conduct or conduct that unjustifiably violates a citizen’s Charter rights, the plaintiffs have primarily litigated in their own interests. The fact that the action involves public authorities does not serve to alter the private nature of the plaintiffs’ remedial claims.

As a result, I am not persuaded that the plaintiffs ought to be viewed as being analogous to pro bono litigants engaged in public interest litigation for the purpose of determining the costs issues before me.

[34] The reasoning set out above applies equally to the determination of the costs issues involving the WPS defendants, who faced similar allegations to those made against the Belleville defendants, specifically, that they: breached the plaintiffs’ Charter rights; falsely arrested and imprisoned the plaintiffs; and conducted a negligent investigation with respect to criminal charges that they brought against the plaintiffs. That reasoning applies to an even greater extent to the Lowe’s defendants, who were not “public actors” to which the Charter applies.

[35] Therefore, consistent with the reasoning set out above, I conclude:

1. The plaintiffs are not pro bono litigants.
2. The provisions of the Solicitors Act, R.S.O. 1990 c. S.15, are inconsistent with the plaintiffs’ submission that they are entitled to more favourable treatment in respect of costs because their counsel is acting pursuant to a contingency fee agreement, and I decline to extend such treatment.
3. Given the nature of the plaintiffs’ claims, they are not “public interest litigants”, as they otherwise appear to assert. They are not litigants without a direct pecuniary or other material interest in the proceeding and they are not litigants whose pecuniary interest in the proceeding is modest in comparison to its costs. Instead, as against both the WPS defendants and the Lowe’s defendants, the plaintiffs pursued a claim for remedial damages in excess of $2,000,000 on account of causes of action that are all unique to their own private interests.

[36] As a result of the foregoing, I am not persuaded that the plaintiffs ought to be viewed as analogous to “pro bono litigants” engaged in public interest litigation, for the purpose of determining the costs issues before me.

(ii) Impecuniosity and a Family of Modest Means

[37] The plaintiffs assert that they are impecunious or alternatively, “of modest means”. The plaintiffs have the onus to establish their impecuniosity through evidence. They have not done so. Evidence of impecuniosity should be robust. There should be no unanswered questions. Full financial disclosure is required: see Morton v. Canada (Attorney General) (2005), 75 O.R. (3d) 63 (S.C.), at para. 32. Here, the plaintiffs have not delivered any evidence that establishes impecuniosity and they have made no financial disclosure at all.

[38] In their submissions, the plaintiffs indicate that they are willing to provide affidavit evidence setting out their “financial means”, but only on a confidential basis to this court. In my view, that approach would deprive the WPS and the Lowe’s defendants of the opportunity to scrutinize the evidence in support of the plaintiffs’ claim of impecuniosity and to make informed submissions with respect to the issue. I decline to adopt it. If the plaintiffs were desirous of this court considering their specific financial circumstances, they ought to have delivered (i.e. served and filed) cogent evidence in that regard.

[39] In the alternative to their claim of impecuniosity, the plaintiffs submit they are of “modest means”. Although I found favour with that position in the disposition of the costs issues related to the Belleville defendants, the evidence adduced on the WPS and Lowe’s summary judgment motions demonstrates a material change in the financial circumstances of one of the plaintiffs, specifically Andrei Kolosov. The evidence available on the Belleville defendants’ summary judgment motion established that Andrei Kolosov was a student. The available evidence on the WPS and Lowe’s defendants’ summary judgment motions establishes that Andrei Kolosov is now employed as a nurse in the Greater Toronto Area (“GTA”). Conversely, there is no evidence establishing that Mihail Kolosov’s circumstances, as the sole proprietor of a small moving company (using one cube van), have changed. Further, there is no evidence establishing that Alena Kolasava has worked outside the home since the plaintiffs immigrated to Canada. Nonetheless, in the totality of the circumstances, the plaintiffs’ submission that they are of modest means carries less weight in the context of determining the costs of the WPS and Lowe’s defendants than it did in respect of the Belleville defendants. Andrei Kolosov now earns income. Of course, he may have additional debt associated with his post-secondary education, but no evidence or submissions were made specifically in that regard.

(iii) Quantum

[40] The WPS defendants seek costs in the amount of $125,000. The Lowe’s defendants seek costs in the amount of $169,579.07. Both costs claims are inclusive of HST and disbursements and are said to be on a partial indemnity basis with a caveat in relation to the former. Specifically, the WPS defendants posit that in the circumstances of this case their offer to settle provides a basis to award partially indemnity costs in their favour in an amount that approaches substantial indemnity recovery. Conversely, the plaintiffs posit that to the extent costs are awarded against them, the quantum of the awards should be limited to $50,000 for each defendant group, consistent with the quantum of costs previously awarded in favour of the Belleville defendants. I have previously set out the relevant legal principles applicable to fixing the quantum of costs, which I will now apply.

[41] First, in considering the factors set out in r. 57.01(1) of the Rules, I find as follows:

1. In the aggregate, the plaintiffs claimed $2,250,000 in damages from the WPS defendants and the Lowe’s defendants. They recovered nothing.
2. No liability was apportioned against any of the defendants. The action was dismissed.
3. The proceeding was of moderate complexity. As against the WPS defendants, the plaintiff advanced several distinct tortious and Charter-based causes of action. Some of the claims, as asserted, invited the successful application of the Limitations Act, 2002, S.O. 2002, c.24, Schedule B. The claims asserted against the Lowe’s defendants were, in my view, of more complexity than those advanced against the WPS defendants. Some aspects of the claims asserted against the Lowe’s defendants required the determination of whether they owed the plaintiffs a duty of care, as asserted, or at all. Although the nature of the evidence adduced on the motions was not overly complex, its complexity was increased by its sheer volume.
4. The issues involved in the action were important to the plaintiffs, who assert they were unlawfully arrested and detained in contravention of their Charter-protected rights and that they were subjected to negligent investigations conducted by members of the WPS and employees of Lowe’s. The issues were important to the individual members of the WPS, who were alleged to have engaged in misfeasance in the discharge of their duties as peace officers. Finally, the issues were of importance to the individual Lowe’s employees who were alleged to have engaged in actionable misfeasance and to Lowe’s itself, which was alleged to be liable to the plaintiffs, in part, as a result of the manner in which it reported criminality committed against it to police.
5. The plaintiff sought to adduce inadmissible evidence on the summary judgment motion, which necessitated motions to strike portions of the Avery affidavit, as filed.
6. The plaintiffs have not established that they are impecunious. The plaintiff family continues to be of somewhat modest means, but the overall extent of that modesty has diminished since the disposition of the Belleville defendants’ costs issues on August 26, 2016.
7. The WPS defendants advise that the legal professionals that were retained to defend them spent the following amount of time performing services in relation to the action:

Name	Year of Call	Total Hours Claimed	Actual Rate Per hour	Total
Brian McCall	1978	0.3	$305	$ 91.50
Sheila Handler	2001	259.4	104.6 hrs @ $230/hr 154.8 hrs @ $275/hr	$ 24,058.00
				$ 42,570.00
Beth Blanszky	2007	19.7	$200	$ 3,940.00
Daniel McDonald	2010	16.5	$160	$ 2,640.00
Kristen Dearlove	2012	79	$175	$ 13,825.00
Sean Brennan	2013	10.3	$175	$ 1,802.50
Stephanie Marentette	2015	1.1	$175	$ 192.50
Geoffrey Lowe	2016	25.9	$130	$ 3,367.00
Paul Shand	2017	7.2	2.7 hrs @ $130/hr 4.5 hrs @ $150/hr	$ 351.00
				$ 675.00
Bradie Leatherdale	2018	10.1	$130	$ 1,313.00
Jennifer Stockley-Martin	Law Clerk 23 years experience	83	53.5 hrs @ $105/hr 11.9 hrs @ $115/hr 17.6 hrs @ $130/hr	$ 5,617.50
				$ 1,368.50
				$ 2,288.00
Brenda Brewer	Law Clerk 4 years experience	4.4	$115	$ 506.00
Louise Barranger	Law Clerk 4 years experience	20.4	$75	$ 1,247.50
Amy Ribera	Law Clerk 1 year experience	0.3	$115	$ 34.50
Total		537.60 hours		$105,887.50

HST (13%) 13,765.38

TOTAL $119,652.88

In accordance with the foregoing, the WPS defendants expended the sum of $119,652.88 on account of legal fees inclusive of HST and an additional $19,803.97 on account of disbursements inclusive of HST (the most significant component of their expenses relates to the cost of transcripts), for a total of $139,456.85. Apart from challenging the reasonableness and foreseeability of the amount of time and expense incurred by the WPS defendants and their legal service providers in relation to the proceeding, the plaintiffs have not specifically challenged: any aspect of the time claimed to have been incurred by the WPS defendants’ legal service providers; their rates charged; nor the disbursements incurred.

8. Similarly, the Lowe’s defendants have incurred legal expenses in relation to professional services provided by the following persons:

Name	Year of Call	Total Hours Claimed	Actual Rate Per hour	Total
Thomas D. Galligan	1989	611.4	$295	$180,363.00
Thomas D. Galligan (half rate)	1989	42.5	$147.50	$ 6,268.75
Ruth A. Henneberry	1989	68.4	$295	$ 20,178.00
Laura Morz	Law Clerk	5	$100	$ 500.00
Total		727.3 hours		$207,309.75

HST (13%) 26,950.27

TOTAL $234,260.02

As a result of the foregoing, the Lowe’s defendants incurred legal expenses in the amount of $234,260.02 inclusive of HST on account of fees, together with disbursements in the amount of $8,436.83, inclusive of HST, for a total of $242,696.95. Apart from challenging the general reasonableness and foreseeability of the legal expenses incurred by the Lowe’s defendants, the plaintiffs have not specifically challenged: any aspect of the time incurred by its legal service providers in defence of the action; the rates charged; or the disbursements incurred.

9. The WPS defendants served an offer to settle the proceeding on the basis of a consent to a dismissal of the action without costs, in January 2018. The offer remained open for acceptance until this court ultimately dismissed the action against them. Based on the materials produced at Tab 4 of the WPS defendants’ costs submissions, it appears that they incurred legal services with a value of $39,717, exclusive of both HST and disbursements, after that offer was served.

[42] The overall objective of fixing costs is to arrive at an amount that is proportional, fair and reasonable for the unsuccessful party to pay in the particular circumstances of a case, rather than an amount fixed by the actual costs incurred by the successful litigants (although that amount remains an appropriate factor to consider). The plaintiffs submit that the amount of $50,000 as costs to each defendant group is fair and reasonable in all the circumstances, because it is generally consistent with the amount of costs ordered payable by them to the Belleville defendants. Although I am not inclined to order costs against the plaintiffs in the amounts claimed by the two remaining defendant groups, I conclude that the appropriate quantum of costs to be ordered against the plaintiffs in favour of those defendant groups, respectively, is justifiably greater than the quantum previously ordered in favour of the Belleville defendants. I will explain.

[43] First, in disposing of the Belleville defendants’ costs issues, I found that apart from considerations related to the plaintiffs’ financial means, the sum of $28,500, as opposed to the amount of $38,000 that the Belleville defendants requested, was the quantum of costs, on a partial indemnity basis, that was fair and reasonable in relation to the Belleville defendants’ successful summary judgment motion. I further found that prior to consideration of the plaintiffs’ financial means, the sum of $37,500 (as opposed to the requested amount of $43,237) was fair and reasonable as costs on a partial indemnity basis for the balance of the action against the Belleville defendants.

[44] The circumstances in which the foregoing determinations were made differ from those that apply to the determination of the WPS and Lowe’s defendants’ costs claims. The records in the summary judgment motions brought by the WPS and Lowe’s defendants are far more voluminous than the record developed in the context of the Belleville defendants’ summary judgment motion. Unlike the Belleville defendants’ motion, in this instance affidavit evidence was adduced from the plaintiffs, Mihail Kolosov and Andrei Kolosov, who were then subject to cross-examination. The WPS and Lowe’s defendants each submitted several affidavits (from parties and non-parties) in support of their motions. All of the deponents of the affidavits filed by the defendants were subject to cross-examination by the plaintiffs. Conversely, none of the deponents of the affidavits relied upon by the Belleville defendants were cross-examined in the context of their motion. Accordingly, not only were the evidentiary records in the context of the subject motions denser than those in the Belleville defendants’ motion, but the procedures invoked by the parties leading up to the hearing of the motions were more robust, time consuming, and patently more expensive (with cross-examinations taking place over the course of seven days in several different municipalities).

[45] Second, when I disposed of the Belleville defendants’ costs issues I had no doubt that their counsel had spent approximately 220 hours engaged in legal work associated with the summary judgment motion. But, I was not persuaded that the plaintiffs ought to have reasonably expected that amount of time would be incurred by the moving parties’ solicitors. However, as a result of the submissions and disposition of the Belleville defendants’ costs issues, the plaintiffs discovered that the Belleville defendants’ solicitors had, in fact, spent approximately 220 hours on the summary judgment motion. Further, they discovered that information before: the Lowe’s defendants served their motion for summary judgment; the plaintiffs responded to either the WPS or the Lowe’s defendants’ motions for summary judgment; and before any cross-examinations were conducted. As a result of the more voluminous and comprehensive evidentiary records adduced in the context of each of the WPS and Lowe’s motions and the procedures by which those records were developed, I find that the plaintiffs were well positioned to reasonably foresee and that they ought to have expected that counsel for the WPS defendants and counsel for the Lowe’s defendants would spend time well in excess of 220 hours in relation to the summary judgment motions that were ultimately determined in the defendants’ favour, respectively. The plaintiffs’ experience with the costs claimed by the Belleville defendants and the basis for their claims in that regard reasonably allowed them to appreciate the significant legal fees and expenses that would necessarily be incurred by the WPS and Lowe’s defendants in both the defence of the action and in developing and arguing the summary judgment motions to judgment.

[46] Third, for reasons that are not entirely clear, the plaintiffs attempted to adduce otherwise inadmissible affidavit evidence from Ms. Avery in the context of the WPS and Lowe’s summary judgment motions. Much of the evidence that was sought to be admitted was of a similar ilk to affidavit evidence sought to be adduced from Ms. Avery in the context of the Belleville defendants’ summary judgment motion, which was similarly found to be inadmissible. The plaintiffs’ attempt to adduce inadmissible evidence from Ms. Avery, in affidavit form, in the context of the WPS and Lowe’s defendants’ motions for summary judgment reasonably necessitated the successful motions to strike brought by those defendant groups. Those motions increased the complexity, time, and expense associated with the summary judgment motions.

[47] Fourth, in my view, the issues that were engaged and required to be determined in the Lowe’s defendants’ motion for summary judgment were more complex than those raised in the context of the Belleville defendants’ motion.

[48] Fifth, the WPS defendants made an offer to settle the proceeding after the appeal against the dismissal of the action against the Belleville defendants was dismissed. That offer to settle carried with it a significant advantage to the plaintiffs. Had it been accepted, it would have relieved them of any obligation in respect of a potential costs award which they now suggest will, in part, “bankrupt” them. A similar offer was not operable in the context of the Belleville defendants’ motion for summary judgment.

[49] As a result of the foregoing, I am satisfied that the circumstances that are applicable to the determination of the costs issues involving the WPS and Lowe’s defendants are markedly different than the circumstances that applied to the determination of the Belleville defendants’ costs. Consequently, I do not accept that it is fair and reasonable to simply “parrot” the costs disposition in favour of the Belleville defendants, by ordering costs in the amount of $50,000 in favour of each of the WPS defendants and the Lowe’s defendants.

[50] Instead, based on all of the circumstances before me, including my findings with respect to certain of the factors set out in r. 57.01(1) of the Rules, except for the plaintiffs’ financial means which I will address below, I find that the sum of $110,000, exclusive of HST and disbursements, in favour of the Lowe’s defendants and the sum of $75,000, exclusive of HST and disbursements, in favour of the WPS defendants represent quantums of costs, on a partial indemnity basis, for the entirety of the action (including the summary judgment motions) that are fair, reasonable and proportional in all of the circumstances. I also find that those are amounts that the plaintiffs ought reasonably to have foreseen that they would be required to pay in the event that their action was unsuccessful against each of those defendant groups.

[51] In arriving at those findings, I accept as accurate the number of hours claimed to have been expended by counsel for each of the defendant groups in the defence of the action (including the conduct of the summary judgment motions). I find the rates claimed by all the legal professionals whose services inform the quantum of costs to be reasonable (and in the case of Mr. Galligan quite understated, as compared to what one may reasonably expect counsel of his experience and skill to command). Nonetheless, fixing the quantum of a costs award is not purely a mechanical exercise dependant solely on rates charged and hours spent. It is subject to an overriding principle of reasonableness. In considering all the circumstances, apart from the plaintiffs’ “means”, which I will address below, I conclude that the foregoing quantums are reasonable.

[52] I am mindful that the time expended by counsel for the Lowe’s defendants in relation to this action is greater than the time spent by counsel for the WPS defendants, which leads to differing assessments of quantum. In part, that is a function of the disparate nature of the substantive legal and factual issues that each of the defendant groups was required to address in the proceeding. I am also mindful that the quantum of the WPS defendants’ costs that I determined above, represents a greater percentage recovery of the actual legal fees that they incurred, as compared to the Lowe’s defendants’ percentage of recovery. That difference is attributable to the fact that the WPS defendants advanced a very favourable offer to the plaintiffs (as compared to the ultimate result) which the plaintiffs did not accept. The Lowe’s defendants did not advance such an offer.

[53] The plaintiffs do not challenge the reasonableness of any of the specific disbursements incurred and claimed by each of the defendant groups in their costs submissions. I have reviewed the disbursements claimed by each defendant group and find them to be reasonable.

[54] Finally, I observe that the plaintiffs as a group are of somewhat “modest means”, although not to the extent that they were at the time of the disposition of the Belleville defendants’ costs issues. The evidence on the WPS and Lowe’s summary judgment motions establishes that Andrei Kolosov’s means have increased from the time the costs issues against the Belleville defendants were determined, when he was a student with no income. Financial hardship should not eliminate a party’s liability for costs, but it is one of the factors that the court can consider in exercising its discretion under s. 131 of the Courts of Justice Act, in determining the reasonable amount for a costs award. In applying that principle, I remain mindful of the policy reasons for requiring unsuccessful parties to pay costs. However, in all the circumstances before me and having regard to access to justice and financial hardship considerations, I am of the view that an order requiring the plaintiffs to pay the WPS defendants and the Lowe’s defendants an amount for costs representing approximately 85 percent of the partial indemnity fees (plus HST) and 100 percent of the disbursements that I would otherwise have been inclined to award, respectively (as set out above), is reasonable in this instance.

[55] As a result of the foregoing, I fix the Lowe’s defendants’ costs of the action, including the summary judgment motion and the related motion to strike, at $93,500 plus $12,155 for HST, together with disbursements (including HST on those disbursements for which HST is payable) of $8,436.83, for a total of $114,091.83.

[56] For the reasons stated above, I fix the quantum of costs payable by the plaintiffs to the WPS defendants as $63,750 plus HST in the amount of $8,287.50 and disbursements (including HST on those disbursements for which HST is payable) of $19,803.97, for a total of $91,841.47.

[57] Generally, unsuccessful plaintiffs are jointly and severally liable for costs unless the court, in the exercise of its discretion, orders otherwise: see Meady v. Greyhound Canada Transportation Corp., 2013 ONSC 5568, 55 M.V.R. (6th) 120, at paras. 85-92.

[58] I find that there is no reason to depart form the principle that unsuccessful plaintiffs should be held jointly and severally liable for costs, in the circumstances before me. Andrei and Mihail Kolosov advanced: identical causes of action arising from their arrest and detention and the related investigation conducted by members of the WPS; and identical causes of action sounding in negligence against the Lowe’s defendants. Alena Kolasava’s claim against all defendants was statutorily derived from the other plaintiffs’ claims. The plaintiffs are represented by the same lawyer and they relied on the same evidence pertaining to liability against all defendants. In my view, from the outset it was within the plaintiffs’ reasonable expectations that they may be liable for costs on a joint and several basis in the event that they were unsuccessful.

[59] Accordingly, an order will go that the plaintiffs are liable on a joint and several basis to pay costs to the WPS defendants in the total amount of $91,841.47, inclusive of applicable taxes and disbursements. Such costs are payable within 30 days.

[60] An order will also go that the plaintiffs are liable on a joint and several basis to pay costs to the Lowe’s defendants in the total amount of $114,091.83, inclusive of applicable taxes and disbursements. Such costs are payable within 30 days.

“original signed and released by Verbeem J.”

Gregory J. Verbeem Date: May 1, 2019 Justice