Court File and Parties

COURT FILE NO.: CV-09-0381336-0000 DATE: 2019/05/21 SUPERIOR COURT OF JUSTICE – ONTARIO

RE: FABIENE EVANS, Plaintiff AND: PARADIGM CAPITAL INC., Defendant

BEFORE: Gans, J.

COUNSEL: Sean Lawler and Jonathan Miller, for the Plaintiff P.A. Neena Gupta, for the Defendant

HEARD: In writing

Endorsement

[1] The Evans v. Paradigm Capital Inc. wrongful dismissal matter has now returned to me for a third time. [^1]

[2] The plaintiff (“Evans”) in her wisdom decided to appeal the award of damages I made at first instance in 2016, which prompted the defendant (“Paradigm”) to cross appeal. Not only was she not successful in her appeal, but Paradigm, as part of its ‘scorched earth’ appeal, was able to knock down the award of damages significantly, completely obliterating one of the heads of damages upon which the plaintiff was originally successful. The result of this more than modest tweaking of damages on the part of the Court Appeal has mandated me to revisit the costs decision made at first instance. [^2]

[3] Without detailing the checkered history referenced in the above cited cases, Evans recovered after the deduction of a healthy gratuitous payment paid on termination the net sum of more than $137,000, with which she was dissatisfied. In addition, after trial, I awarded her partial indemnity costs of $171,000 (inclusive of HST) plus most of her disbursements.

[4] In that costs award, which ran to 7 pages, I was compelled to deal with several discrete issues, which Paradigm argued, disentitled Evans to either an award of costs or significantly impacted the final number. These arguments caused me to consider several offers to settle and their relationship to Rule 49, the concept of divided success and a request for a distributive costs award, Evans’ misguided insistence on asserting throughout trial a claim of bad faith and an allegation based on the new cottage industry claim of breach of honest performance and a myriad of other Rule 57 considerations. Having regard to the fact that many of the same arguments are revisited at this moment in time, I incorporate those reasons for decision in this endorsement where applicable. [^3]

[5] As a result of the recent decision of the Court of Appeal, which reversed an award of almost $80,000 in respect of a shareholder’s bonus, Evans’ net recovery was but a little more than $57,000.

[6] Paradigm asserts, among other things, that many of the arguments on costs advanced at first instance have to be revisited particularly since the new net amount falls below what it suggests was an extant offer to settle made in March 2010 (the “March 2010 Offer”). That offer provided for payments of:

• $64,261 ( less statutory deductions ) as damages in lieu of notice, plus pre-judgment interest on this amount from July 15, 2009 to the date of payment.
• $15,000 as damages for mental distress and/or allegations of discriminatory conduct.
• $25,000 in partial indemnity costs (or such greater amount as assessed by an Assessment Officer) ( emphasis added ).

[7] Rule 49.10(2), the operative rule, sets out costs consequences of a plaintiff’s failure to accept an offer to settle that is as favourable or more favourable than the amount she recovers at trial. In this case, the three threshold requirements under Rule 49.10(2) are, surficially, met, namely:

a. Paradigm made the offer at least seven days before the commencement of the hearing; b. the offer was not withdrawn and did not expire before the commencement of the hearing; and c. Evans did not accept the offer.

[8] The threshold question is whether or not the terms of the March 2010 Offer are better or equal to the net amount received in the ultimate judgment. It is clear by reason of Rule 49.10(3) that the burden of meeting that threshold rests with Paradigm. In my view, for the reasons that follow, it has not discharged this burden.

[9] The aforesaid March 2010 Offer at bullet point 1 is not a clean offer, as it were, since it adds, in parentheses, the words “less statutory deductions” without further explanation or detail. As best as I can determine from the mass of material provided me electronically in support of their respective positions, neither party addressed the legal or factual issues in respect of the ‘statutory deductions’ referenced in the offer.

[10] While I have no doubt from the history of the action that Evans would have rejected the March 2010 Offer even had she known or could have calculated with specificity the suggested deductions, regrettably for Paradigm, I cannot say with certitude whether the offer met the strictures of the operative rule. [^4]

[11] There was an additional offer made in February 2016 upon which I have already commented in the previous costs decision. I do not intend to repeat the analysis set out in that decision, particularly since it appears that Paradigm, in its written material, was relying on the March 2010 Offer for its Rule 49 argument.

[12] Having regard to my disposition, I need not formally consider certain other arguments advanced by Paradigm, which I will just touch on in passing:

(1) that I should receive fresh evidence of a purported agreement between Evans and her trial counsel which it was suggested placed a floor on her recovery, if not in respect of her obligation for her own solicitor and client fees. In the first place, while I would have entertained the fresh evidence as hitting all the benchmark indicia for its receipt, the material provided was less than clear and cogent and left me guessing as to its import.

That conclusion notwithstanding, because of my disposition below, I need not decide how the agreement impacts the reckoning of the dollars of costs sought by Evans.

(2) Paradigm also argued that the amount of her recovery places Evans below the threshold prescribed in Rule 76.13, which covers Simplified Procedures. Accordingly, I am therefor obliged to consider the costs regime provided for by that rule.

I need not consider that argument because the threshold now prescribed by the Rule only came into effect after the commencement of the instant action and, hence, the then operative threshold was $50,000, an amount which the plaintiff “handily” surpassed. [^5]

[13] The rejection of Paradigm’s arguments just reviewed does not, however, leave me with a ‘default’ position of awarding Evans her costs of the process. I am nevertheless obliged to exercise my discretion in accordance with the general principles set out under Rule 57.01, many of which, as Paradigm points out, are drawn into the calculus.

[14] While no doubt the plaintiff was not successful on many of the ‘big ticket’ items advanced throughout, she nevertheless had to mount a concerted effort to succeed on the items which, ultimately, carried the day, albeit but modestly. I need go no further than to incorporate by reference the matters ‘re-litigated’ by Paradigm before the Court of Appeal.

[15] In the final analysis, the results in the circumstances are mixed. In my view, the appropriate disposition is that each party should bear their own fees and disbursements throughout. There shall accordingly be no order as to costs.

GANS, J. Date: May 21, 2019

[^1]: Evans v. Paradigm Capital Inc., 2016 ONSC 4286, 36 C.C.E.L. (4th) 129, varied, 2018 ONCA 952, 51 C.C.E.L. (4th) 21. [^2]: 2016 ONSC 7500, 39 C.C.E.L. (4th) 311. [^3]: I would observe that counsel in this matter decided it was simply sufficient to address the matters in issue in respect of Evans Costs Redux by way of Supplementary Arguments, such as they were, compelling me to review their respective arguments at first instance and cobble together the essence of their arguments at this moment in time, a most unsatisfactory form of advocacy. [^4]: Elbakhiet v. Palmer, 2014 ONCA 544, 121 O.R. (3d) 616, leave to appeal to S.C.C. refused, 2015 CarswellOnt 641; Onisiforou v. Rose (1998), 41 O.R. (3d) 737 (C.A.). [^5]: Rule 76.13(11).