COURT FILE NO.: CV-16-298-00

DATE: 20190821

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Susan Elizabeth Eks, Plaintiff

AND:

Kerri Lynn Tadeu, Defendant

BEFORE: Mr. Justice Graeme Mew

COUNSEL: David M. Adams and Matthew Taft, for the Plaintiff

Carlin McGoogan, for the Defendant

HEARD: In Writing

ENDORSEMENT on costs

[1] The legal dealings between the parties to this action started in 2011 when, seemingly in relation to a neighbourhood dispute, Susan Eks committed serious criminal acts which could have endangered the lives of Kerri Lynn Tadeu and her family (but, thankfully, did not).

[2] Ms. Eks was convicted of two counts of mischief and one count of attempted arson endangering life. She served her sentence. She moved out of the neighbourhood.

[3] That should have been the end of it. Sadly, as described in my Reasons for Judgment in this matter, reported at 2019 ONSC 3745, it was not.

[4] After a one and a half day civil trial, conducted pursuant the summary trial procedures set out in Rule 76.1(2), I dismissed both the claim made by Susan Eks against Kerri Tadeu (alleging malicious prosecution, harassment, intentional infliction of mental suffering and negligent infliction of psychiatric damage) and a counter-claim by Kerri Lynn Tadeu against Susan Eks (alleging intentional infliction of mental distress, negligence, nuisance, intimidation and interference with enjoyment of property).

[5] In the closing paragraphs of my reasons, I said the following with respect to the issues of costs:

[151] Neither party has enjoyed success. Both parties have, no doubt, incurred significant legal fees getting to this point.

[152] Unless there were offers to settle which have costs consequences pursuant to rule 49, my inclination is to order each side to bear its own costs. However, if there are offers, or if either party wishes to argue that a different disposition of costs is appropriate, I would encourage the parties to resolve the issue of costs, failing which, costs submissions should be filed…

[6] As it turns out, offers to settle were made. And the parties have been unable to resolve issues of costs among themselves.

[7] Before reviewing the offers and discussing their significance, I should mention the bills of costs provided by the parties. Their contents were disappointing, but not surprising. The total of fees and disbursements incurred by Susan Eks was $68,304.29. Kerri Lynn Tadeu incurred fees and disbursements of $101,508.74 (this is based on substantial indemnity rates; the full indemnity rates would possibly yield an even higher total).

[8] For ordinary citizens these are huge amounts of money to have spent on litigation such as this. It makes no sense that they have done so.

[9] In the observations that follow, I have borne in mind throughout the provisions of Rule 57.01 and, in particular, the factors of proportionality, the reasonable expectations of the parties, and the manner in which the litigation was conducted.

Offers to Settle

[10] The parties each made two offers to settle. Their first offers, made early in the litigation, were subsequently withdrawn and replaced with offers made much closer to trial.

[11] The following chronology outlines the offers that were made and puts them in the context of the litigation generally.

DATE

PLAINTIFF

DEFENDANT

28 July 2016

Statement of Claim

8 August 2016

Notice of Intent to Defend

8 August 2016

Offer to Settle dismissing action without costs (if accepted prior to 12 August) or with costs payable to the defendant on a partial indemnity scale (if accepted after 12 August).

29 August 2016

Statement of Defence

26 October 2016

Offer to Settle for dismissal of action on a without costs basis; parties to execute mutual full and final releases in a form satisfactory to counsel.

29 March 2017

Offer to Settle dated 8 August 2016 withdrawn

6 April 2017

Order of Johnston J. (on consent) requiring the plaintiff to deliver an Affidavit of Documents and granting the defendant leave to amend the Statement of Defence to include a counter-claim. Costs of the motion to be to the defendant in any event of the cause.

25 April 2017

Amended Statement of Defence and Counter-Claim served.

29 September 2017

Offer to Settle dated 26 October 2016, withdrawn.

10 May 2018

Order of Scott J. (on consent) requiring plaintiff to complete undertakings, obtain previous endorsements in related proceedings and execute an authorization for disclosure of unredacted information. Costs fixed at $750.00 payable by the plaintiff to the defendant (costs paid).

10 July 2018

Motion brought by Defendant requiring plaintiff to deliver sworn Affidavit of Documents. A sworn Affidavit of Documents and copies of Schedule “A” documents was subsequently provided prior to motion being heard. Plaintiff agreed that costs of this motion should be in the cause.

26 November 2018

Offer to Settle for (a) permanent mandatory injunction requiring the plaintiff to stay at least 500 metres away from defendant’s residence; (b) payment by plaintiff to defendant of $70,000.00 for damages; (c) payment of interest; (d) payment of costs by plaintiff on a partial indemnity scale.

16 January 2019

Offer to Settle on basis that both parties shall consent to a dismissal of all present claims and counter-claims on a without cost basis; execution of full and final releases, including mutual confidentiality clauses, in a form satisfactory to counsel.

27/28 February 2019

Trial

17 June 2019

Reasons for Judgment

[12] Each party asserts that the other unreasonably failed to accept the other’s offers.

[13] While Rule 49.10 requires a plaintiff to obtain judgment in her favour – neither party having done so – before the costs consequences of that subrule kick in, in exercising its discretion with respect to costs, Rule 49.13 permits the court to take into account any offer to settle made in writing, the date the offer was made, and the terms of the offer.

[14] Ms. Tadeu’s position is that:

(a) Ms. Eks should have accepted her first offer to settle, made at the very outset of the litigation (it will be recalled that the “without costs” element of that offer was only open for acceptance for four days; thereafter, costs would have been payable).

(b) The initial offer to settle made by Ms. Eks, made approximately 11 weeks after Ms. Tadeu’s first offer (dismissal without costs), was not reasonable. Ms. Eks could have settled the proceeding on that basis in early August 2016, but refused to do so, “instead running up Ms. Tadeu’s bill”. What Ms. Eks should have done, instead, was simply accept Ms. Tadeu’s first offer and paid “a relatively small amount of costs”.

(c) The second offer made by Ms. Eks was unreasonable having regard to the date on which it was served. Trial preparation was nearly complete and Ms. Tadeu had incurred the expense of an expert report. Furthermore, the offer included a confidentiality provision from Ms. Tadeu “for free, while not even offering any promise to stay away from Ms. Tadeu and her family”.

[15] Ms. Tadeu also argues that the manner in which Ms. Eks conducted the litigation unnecessarily lengthened the litigation and ran up Ms. Tadeu’s costs. Three interlocutory motions had to be brought to deal with discovery obligations (two of which led to consent orders; the third was resolved without an order being required). Then on the eve of trial, Ms. Eks served a voluminous motion challenging the scope of the proposed opinion evidence to put by Ms. Tadeu’s expert witness as well as a motion seeking to extend the time limits set for trial. Both of those motions were resolved before the commencement of trial without having to be argued.

[16] Ms. Eks acknowledges the two offers to settle made earlier on in the litigation. As she puts it, “[b]oth sides offered to settle in late 2016 and were close to a resolution; the sticking point was Tadeu’s insistence on costs”.

[17] By April 2017, Ms. Tadeu had withdrawn her offer and counter-claim, thereby increasing the stakes and reducing the odds of resolution. By the time of examinations for discovery in October 2017, Ms. Tadeu said, in answer to a question: “We’re so far beyond a conversation at this point. I want this in front of a judge. I’m going the distance to trial. I am not going anywhere outside – I am not signing a confidentiality agreement on this one. This will be, like that is no – like, I want this public.”

[18] And so it went on.

[19] The final offers made by the parties, which remained open for acceptance at the commencement of trial, were an offer by Ms. Eks to walk away without costs (albeit made only a few weeks before the commencement of trial), and an offer by Ms. Tadeu to settle for $70,000.00, plus interest, costs and a permanent injunction.

[20] Ms. Tadeu sees the “walk away” offer made by Ms. Eks shortly before trial differently. As she puts it:

Having put Ms. Tadeu to crippling expense through several years of litigation, Ms. Eks now sought to force Ms. Tadeu to bear that entire expense, and yet to extract a confidentiality provision from her for free. It is respectfully submitted that this offer, coming when it did and with the additional demand for a confidentiality agreement, was not reasonable.

[21] Ms. Tadeu’s stance, as the trial approached, was anything but compromising.

[22] Her position on the second Eks offer of settlement has to be seen in the context of (a) her comments about wanting to go to trial; (b) the offer of settlement made by her two months previously for a permanent injunction and $70,000.00 in damages (plus interest and costs); and (c) the fact that her claim for damages related only to the events of January 2016 (an earlier civil lawsuit commenced by Ms. Tadeu against Ms. Eks as a result of the events of September 2011 having been settled by way of a financial settlement in favour of Ms. Tadeu and a full and final release in favour of Ms. Eks).

[23] Indeed, when one looks at Ms. Tadeu’s response to the first Eks offer, a similarly uncompromising position can be seen.

[24] She protests that because Ms. Eks had failed to accept Ms. Tadeu’s own “walk away” offer within the four day window that it was open for acceptance, the “enormous amounts” of further costs that were incurred could have been avoided. Yet when one examines the bill of costs submitted by Ms. Tadeu, it can be seen that at the time the first Eks offer to settle was delivered she had incurred fees, on a substantial indemnity scale, of just $1,185.00 plus some presumably modest disbursements.

[25] Being no stranger to the litigation process, as a result of already having sued Ms. Eks herself, Ms. Tadeu’s failure to accept the first Eks offer and walk away at a time when she had spent far less responding to Ms. Eks’ lawsuit than Ms. Eks had spent defending herself against Ms. Tadeu’s attempt to obtain peace bond, was unreasonable.

[26] So was her failure to accept the second Eks offer.

[27] Ms. Eks submits that a reasonable award of costs in the circumstances would be one that compensates Ms. Eks for her partial indemnity costs from 16 January 2019 (the date of her last offer) through to the end of trial. This would amount to $19,343.50.

[28] I agree that Ms. Tadeu should pay some costs. Aside from her uncompromising attitude, whereas her claim had no merit whatsoever, the claim made by Ms. Eks had at least some prospect of success. It was only after the trial had been completed that the Court of Appeal, in Merrifield v. Canada (Attorney General), 2019 ONCA 205, reversed an earlier decision of this court and ruled that harassment is not a tort recognised under Ontario law.

[29] Furthermore, although it was necessary for Ms. Eks to bring three interlocutory motions due to the noncompliance by Ms. Eks with her discovery obligations, the manner in which Ms. Tadeu conducted the litigation was not blameless either. After the pretrial, she served an affidavit from Collin Fitzgerald for use at trial. He was offered up as an “eyewitness” to the January 2016 reattendance by Ms. Eks on Apollo Terrace. Yet she had never mentioned him during her statements to the police. He then, from the witness box, modified key aspects of his evidence. I ultimately found that his evidence was “contrived”.

[30] Furthermore, Ms. Tadeu served an expert report of Dr. Judith Pilowsky less than 90 days prior to the pretrial (contrary to Rule 53.03). Dr. Pilowsky had not reviewed any of Ms. Tadeu’s medical records before forming her opinion, her report had not identified what documents she had reviewed, and she was unaware that Ms. Tadeu was already receiving long-term disability prior to January 2016 as a result of post-traumatic stress disorder. Ms. Eks submits, correctly, that Dr. Pilowsky’s opinion was of little assistance to the court.

[31] The costs claimed by Ms. Eks – $19,343.50 – are reasonable. However, there should be an offset for the costs award made in Ms. Tadeu’s favour on 6 April 2017 in any event of the cause. I fix those costs in the all-inclusive amount of $2,500.00.

[32] By reason of the foregoing, the order of this court is that Susan Eks is entitled to a contribution towards her costs of $16,843.50, payable by Kerri Tadeu.

Mew J.

Date: 21 August 2019