Court File and Parties
BARRIE COURT FILE NO.: CV-14-1200
DATE: 20190719
CORRECTED DATE: 20190910
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Deven Brophy, Plaintiff
AND:
Veronica Harrison et al., Defendants
BEFORE: THE HON. MADAM JUSTICE A.A. CASULLO
COUNSEL: P. Cho and M. Nieuwland, for the Plaintiff
R. Reisler and R. Tapp, for the Defendants
HEARD: In Writing
Corrected Endorsement: The text of the original Endorsement was
Corrected on September 10, 2019 and the description of the correction is appended.
COSTS ENDORSEMENT
Overview
[1] The plaintiff brought this action for damages sustained as a result of a motor vehicle collision which occurred on March 24, 2014. The action was tried by a jury. Both liability and damages were at issue.
[2] At trial the plaintiff suggested a range of damages between $996,900.89 and $1,150,700.89. The defendant’s suggested range was between $5,000 and $10,000.
[3] After a 10-day jury trial the plaintiff was awarded judgment in the amount of $62,628.75. After applying the statutory deductible, and accounting for the plaintiff’s accident benefits settlement, her net judgment was $17,688.64.
[4] I have reviewed counsels’ written costs submissions and what follows is my decision in this regard.
Litigation Background
[5] The litigation ran a typical course. Following discoveries, and in the lead-up to trial, pre-trial conferences were held (September 2017, November 2018, and April 2019), at which the plaintiff presented various settlement offers.
[6] No offer to settle was forthcoming from the defendant. There was not even an offer to go without costs, which effectively left the plaintiff with no choice but to proceed to trial to seek recovery for her injuries. This is of course a fully defensible position for the defendant to take, but it may have concomitant consequences.
[7] The trial was adjourned twice at the request of defence counsel – the first to accommodate their expert who was unable to attend; the second because defence counsel was conducting another trial.
[8] Given that the plaintiff did not beat her formal offer of $75,000.00 plus costs and disbursements, Rule 49 is not engaged. The plaintiff was, however, successful against the defendant on damages and liability, and thus is entitled to her costs on a partial indemnity basis.
Positions of the Parties
[9] The plaintiff seeks a total of $283,456.60, comprised of costs plus HST of $218,587.20, and disbursements plus HST of $64,869.40. Included are the plaintiff’s costs thrown away for each adjournment.
[10] The defendant submits that costs thrown away are inappropriate, given that the plaintiff consented to the adjournments, and costs were not addressed at that time.
[11] The defendant submits that an award based on the figures proposed by the plaintiff would fail to pay heed to the notion of proportionality, or the balance between the amounts recovered and the costs awarded. The defendant suggests an award of $70,000 is more appropriate.
[12] The defendant further submits as a relevant consideration the fact that the amount recovered by the plaintiff was within the jurisdiction of Small Claims Court. Relying on Louws Kitchen Designs Ltd. v. France, [2016] O.J. No. 521, the defendant states that there must be proportionality between the amount recovered and the costs award (emphasis added).
[13] Parenthetically, the plaintiff submitted that the costs she incurred related to her accident benefits settlement should be awarded as legal costs against the defendant ($4,597.52). The defendant did not make submissions on this issue, so I did not make a finding.
Analysis
[14] Costs of a proceeding are in the absolute discretion of the court: Courts of Justice Act, R.S.O. 1990, c. C.43, s. 131(1).
[15] When fixing costs, the court is to consider the facts and circumstances of the particular case. A judge is not to conduct a line-by-line assessment, but rather make a determination of what the services devoted to the action were: Apotex Inc. v. Egis Pharmaceuticals, 1991 CanLII 2729 (ON SC), [1991] O.J. No. 1232.
[16] A judge is also to consider the factors set out in Rule 57.01 of the Rules of Civil Procedure.
[17] While the individual factors set out in Rule 57 provide guidance when assessing and fixing costs, as Boswell J. held in Nesbitt v. Jeffery, 2018 ONSC 7285:
Regardless of the particular factors considered relevant by the court on any given assessment, it is now well-settled that the overarching principles to be observed in the exercise of the court’s discretion to fix costs are fairness, proportionality and reasonableness: see Beaver v. Hill, 2018 ONCA 840; Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 CanLII 14579 (ON CA), 71 O.R. (3d) 291 (C.A.); and Moon v. Sher (2004), 2004 CanLII 39005 (ON CA), 246 D.L.R. (4th) 440 (C.A.).
[18] Generally, I take no issue with the Bill of Costs. The fees for Mr. Cho and Mr. Nieuwland, at $225 and $200 per hour respectfully, are reasonable.
[19] The defendant takes issue with Mr. Smitiuch’s regular involvement leading up to the trial, but I do not find this to be untoward. Mr. Smitiuch is the firm’s principal. He has 13 years more experience than Mr. Cho, and his assistance interviewing witnesses, preparing experts and providing input on overall trial strategy were no doubt of value.
[20] I do find that $23,000 for the three pre-trials, including 38 hours in preparation for the third pre-trial to be excessive, and a reduction of $8,000 inclusive of HST is appropriate.
[21] The plaintiff’s disbursements are also reasonable and not excessive. I find the experts called made a contribution to the case, and the costs of the experts were proportionate to the economic value of the issue at risk: Hamfler v. Mink, 2011 CanLII 8246 (ONSC)
[22] With respect to the defendant’s submissions regarding the Small Claims Court jurisdiction, in my view it was reasonable for the plaintiff to bring her action in Superior Court under the regular rules. Her case had merit and her decision to continue to trial was reasonable in the absence of any offers from the defendant. I reject the defendant’s position that the plaintiff’s award of costs should be reduced because the ultimate verdict of the jury was less than the Small Claims Court limits.
[23] In terms of proportionality, I look to the decision of Hackland J. in Corbett v. Odorico, 2016 ONSC 2961, in which he held that:
In my view, to impose a rule arbitrarily limiting the amount of costs to some proportion of the recovery when there has been no offer of settlement, or only a nominal offer as in this case, would undermine the purpose of Rule 49, which is to encourage settlement by attaching costs consequences for failure to make or accept reasonable offers. It would also encourage the type of “hard ball” approach to settlement employed in this case.
[24] Justice Hackland also refenced Aacurate v. Tarasco, 2015 ONSC 5980, where McCarthy J. comments that declining to make realistic costs awards in modest cases would send a message to litigants that it is not worth one’s while to pursue legitimate claims in court, because one cannot possibly make it cost effective to do so.
[25] I find favour with McCarthy J.’s conclusion that limiting the losing party’s exposure to costs proportionate to the size of the claim would encourage those resisting legitimate but modest claims to take unreasonable positions.
Conclusion
[26] The defendant urges that if the court is not prepared to award costs within the jurisdiction of the Small Claims Court, then proportionality should be the yardstick against which costs are measured.
[27] To accede to this argument would unduly shave the plaintiff’s costs, based solely or primarily on an undue emphasis on the application of proportionality: Persampieri v. Hobbs, 2018 ONSC 368, at para 95.
[28] When assessing costs, not only are the reasonable expectations of the successful party to be considered, the court must also look to the reasonable expectations of the unsuccessful party: Boucher.
[29] Despite my direction that a Bill of Costs was to be included with written submissions, the defendant chose not to do so. Without knowing what the defendant’s costs were for this trial, I cannot complete the “reasonable expectation” analysis. The inference to be drawn is that the quantum of the defendant’s costs approaches those of the plaintiff.
[30] The defendant took what I would view to be a hard-ball approach to this claim, and now must accept the consequences of that decision.
[31] After considering all of the above, the plaintiff is awarded costs in the amount of $210,587.20, plus disbursements of $64,869.40 (both figures inclusive of HST), for a total of $275,456.60. There has been no reduction for costs thrown away for trial preparation.
CASULLO J.
Date: September 10, 2019
September 10, 2019 – Correction:
The citation in the second line of para. 17 has been corrected to read: Nesbitt v. Jeffery, 2018 ONSC 7285.