COURT FILE NOs: CV-18-603803-00CP

DATE: 20191031

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Leslie Austin, Plaintiff

– AND –

Bell Canada, Bell Media Inc., Expertech Network Installation Inc., and Bell Mobility Inc., Defendants

BEFORE: E.M. Morgan J.

COUNSEL: Mark Zigler, Jonathan Ptak, and Matthew Baer, for the Plaintiff

Dana Peebles and Atrisha Lewis, for the Defendants

Paul-Eric Veel, for the Class Proceedings Fund

HEARD: Costs submissions in writing

COSTS ENDORSEMENT

[1] On August 12, 2019, I released my reasons for judgment in this case, Austin v Bell Canada, 2019 ONSC 4757, with Supplementary Reasons on October 15, 2019: Austin v Bell Canada, 2019 ONSC 5961.

[2] The matter was argued as a double motion, with the Plaintiff seeking certification under section 5 of the Class Proceedings Act, 1992, SO 1992, c 6 ("CPA") and the Defendants seeking summary judgment under Rule 20.01 of the Rules of Civil Procedure, RRO 1990, Reg 194. I ordered the claim certified as a class action and then granted summary judgment dismissing the action in its entirety.

[3] At the end of my August 12, 2019 reasons I asked for cost submissions in writing. I have now received them from all counsel, including from counsel on behalf of the Class Proceedings Fund (the "Fund") who did not previously take part in the argument of the case.

[4] Counsel for the Defendants have submitted a Bill of Costs in which they calculate their fees on a partial indemnity basis as coming to $221,555.50 (plus HST and disbursements). However, they submit that under the circumstances they are entitled to their fees on the basis of either a full or a substantial indemnity scale. Their Bill of Costs establishes that full indemnity would come to $369,259.16.

[5] Counsel for the Defendants makes the claim for an elevated scale of costs on two grounds: a) the fees billed to their clients were discounted so that the partial indemnity scale is substantially below what the costs award otherwise would and should be, which is more accurately reflected by a full indemnity award; and b) the Plaintiff pleaded, among other things, breach of trust and was unsuccessful in that claim, and this should attract costs at least on a substantial indemnity scale.

[6] Counsel for the Plaintiff have submitted a Bill of Costs in which they seek partial indemnity costs of $106,624.20 for the certification motion and $4,949.70 for a preliminary motion to admit evidence (plus HST and disbursements for both). They submit that they are entitled to these costs independently of whatever the Defendants are awarded in respect of the summary judgment motion.

[7] Counsel for the Fund submits that there should be a 30% reduction in partial indemnity costs awarded against the Plaintiff insofar as the claim was brought as a matter of public interest. They explain that the Fund helped finance the Plaintiff's claim, like all of the claims to which it contributes, out of a commitment to access to justice and not on a commercial basis. Section 31(1) of the CPA specifically allows for such reductions in the event of test case or public interest litigation, and counsel for the Fund puts the present claim, brought on behalf of a large class of pensioners, in that category.

[8] With respect, there is a certain artificiality to the Plaintiff's request for costs. The preliminary evidence motion was de minimis in the larger scheme of the certification-summary judgment proceeding. It was never even mentioned in my judgment on the merits. The rest of that double motion swallowed up any significance that counsel might initially have attributed to the evidence motion. I cannot imagine that any time was realistically spent on that motion that was not also part and parcel of the larger preparation for and argument of the substantive motions that accompanied it.

[9] As for the certification motion, while it is true that the Plaintiff was successful in that motion, the success was one of form, not substance. In the first place, certification was not particularly controversial. I specifically stated my August 12, 2019 reasons, at para 11, that, "This is an easy claim to certify." Counsel for the Defendants did make arguments about the existence of an alternative, administrative forum and with respect to the quantification of damages and the involvement of the Defendants other than Bell Canada itself, but those were never going to stop the action from being certified. After all, members of a given pension plan are obviously a defined class with common financial interests, and it was not in the Defendants' ultimate interest to entirely resist certification.

[10] The Defendants' approach to the double motion was to end this potential class action. They did not aim to achieve summary judgment against the named Plaintiff, leaving the pension payments open to challenge by another pensioner perhaps with a slightly different take on the same issue. They benefitted by having the action dismissed on a class basis, which meant that it first had to be certified before summary judgment was granted dismissing the entire matter as against the class. To award the Plaintiff over $100,000 for "winning" the certification motion would be a misreading of the result of the double motion argued before me.

[11] Turning to the arguments put forward by counsel for the Fund, I understand that it is important for the Fund to protect itself against large costs awards as its resources are limited and exist for the benefit of the public at large. That, however, does not mean that every action that it funds is necessarily in the "public interest" as that term has been used by the courts.

[12] The Fund's counsel relies on Sutherland v Hudson's Bay Co., 2008 5967 (SCJ) for the proposition that the court may exercise its discretion in fixing costs to discount any award brought by a representative plaintiff bringing a class action in the "public interest". In Sutherland, Wilton-Siegel J. made reference to Williams v Mutual Life Assurance Co. of Canada, 2001 62796 (ON SC), [2001] OJ No 445, para. 24 (SCJ) for the definition of that crucial phrase. He stated, at para 42:

There is, of course, a public interest component in respect of any litigation. However, in my view, to be a 'matter of public interest' the class action must have some specific, special significance for, or interest to, the community at large beyond the members of the proposed class. This might be the situation where, for example, fundamental human rights are in issue or an environmental issue is present.

[13] Counsel for the Defendants submit that there is nothing about the present case that suggests that it was brought in the interests of anyone but the class members. I agree. If this claim was brought in the "public interest" then every class action – or, at least, every large class action – is ipso facto brought in the public interest. That is not what is meant by the discretion authorized under s. 31(1).

[14] The present case involved an ultimately unsuccessful attempt to reinterpret a certain detailed mathematical calculation made under the Bell pension plan. It did not engage any broad issue of principle beyond the specific issue of interpretation and calculation that the Plaintiff challenged, and did not impact on anyone but members of the pension plan of which the Plaintiff is a member.

[15] It is true, of course, that Bell Canada and its related entities are a large corporate family with a large number of pensioners, and so the class was correspondingly large. Nevertheless, the class is composed only of those persons whose pension rights are defined by a specific private, corporate pension plan. No one else in society, regardless of whether or not they are members of another private sector or, for that matter, public sector pension plan, has an interest in or is impacted by the interpretation of this specific provision of the class members' plan.

[16] Likewise, this was not a "test case" in any real sense of that term. The Plaintiff did test the waters for a creative interpretation of a specific pension calculation, and was ultimately found to be incorrect in his approach. But again, this was done for the particular financial benefit of plan members, and was not fashioned to test any issue of principle or policy effecting a sector of society beyond former Bell Canada employees.

[17] This litigation was not brought for the public's benefit. It does not fit into either the category of public interest litigation or test case litigation as those terms are typically understood. I am not inclined to exercise my discretion under section 31(1) of the CPA to reduce the costs award on that basis.

[18] At the same time, I am not inclined to increase the award to the Defendants based on the fact that their counsel may have discounted the fees it charged. Under the circumstances, that does not seem fair to the Plaintiff.

[19] As indicated, Bell Canada and the other Defendants make up a large corporate group. If one of Canada's largest corporations manages to negotiate reduced hourly rates with its law firm, that is strictly between the firm and its client. No doubt the firm made a cost-benefit analysis when it went into that arrangement. The 'cost' side of those costs and benefits to the firm cannot now be transferred to the unsuccessful Plaintiff.

[20] Likewise, the fact that one of the Plaintiff's causes of action was breach of trust does not entitle the Defendants to substantial indemnity costs. The reason for raising the level of costs in cases of breach of trust is that such a claim is often akin to a claim of fraud – i.e. impugns the integrity of a defendant by alleging the conscious exploitation of a beneficiary by a trustee acting contrary to its position of trust.

[21] In the case of a calculation claim by pensioners with respect to their pension plan, the cause of action in breach of trust does not speak to that type of exploitation. Rather, it is more of a formal matter, since the contract-like arrangement between the plan's administrator and the members of the plan is, strictly speaking, a trust.

[22] The breach of trust pleading is designed to cover this formal financial arrangement. Beyond that, it does not imply or allege any more male fides by the plan's trustee than does a claim of breach of contract. The plan is a financial arrangement, the claim is a financial claim, and the defense is a financial defense. This is not the kind of breach of trust claim that should attract costs on a substantial indemnity scale.

[23] I am conscious of the fact that it is the Fund that will be paying the Plaintiff's costs for him, and I do have an overall concern that the Fund not have its resources depleted any more than necessary. The Fund represents a positive contribution of the province's lawyers to the problem of access to justice, and it deserves respect in that regard.

[24] I also do note that although it was summary judgment rather than certification that was the real contest here, the Defendants did not entirely concede certification. Instead, they put up enough, albeit somewhat weak, resistance that Plaintiff's counsel were compelled to invest some time and effort into responding to the defenses that were put up.

[25] Costs are always a discretionary matter under section 131 of the Courts of Justice Act, RSO 1990, c C43. In exercising that discretion, the court is required to consider what is "fair and reasonable" in fixing costs, having regard to the principles of access to justice, indemnification and the reasonable expectations of the parties. Boucher v Public Accountants Council (2004), 2004 14579 (ON CA), 71 OR (3d) 291, paras 26, 38 (Ont CA).

[26] I will exercise my general discretion and my concern for the Fund by rounding down the Defendants' partial indemnity cost request. The Plaintiff shall pay the Defendants $200,000 in respect of fees, plus HST thereon and disbursements in the amount of $45,199.57.

Morgan J.

Date: October 31, 2019