Court File and Parties

COURT FILE NO.: CV-18601710 DATE: 2019/01/28

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Loan Away Inc. AND: Western Live Assurance Company

BEFORE: H. Sachs J.

COUNSEL: Elliot Birnbaum and Michael Crampton, for the Plaintiff Arthur Hamilton and Laurie Livingstone, for the Defendant Christiaan Jordaan, for IWS Creditor Group

HEARD: In writing

ENDORSEMENT Re costs

[1] The Plaintiff brought a motion for an interlocutory injunction against the Defendant. The Defendant moved that the action be stayed on the basis of an arbitration clause contained in the agreement between the parties. The Plaintiff opposed the stay, but argued that if any issues were referred to arbitration, the court should order that the arbitration be joined with an ongoing arbitration between IWS Creditor Group Inc. (“IWS”) and the Defendant. To this end, the Plaintiff brought a motion seeking leave to amend it Statement of Claim to add IWS as a party.

[2] On December 4, 2018, I dismissed the Plaintiff’s motion for injunctive relief and made an order staying its action against the Defendant. I also denied the Plaintiff’s request to consolidate the arbitration between it and the Defendant with the arbitration that is ongoing between IWS and the Defendant.

[3] The parties were invited to make written submissions as to costs. I have now received those submissions.

[4] The Defendant, as the successful party, seeks its costs on a substantial indemnity basis fixed in the amount of $73,552.05. If costs are awarded on a partial indemnity basis, it requests that those costs be fixed in the amount of $49,695. 77.

[5] IWS also seeks substantial indemnity costs. It filed a Costs Outline disclosing that its substantial indemnity costs were $21,214.23 and its partial indemnity costs $14,218.46.

[6] The Plaintiff opposes the request for substantial indemnity costs. It acknowledges that both the Defendant and IWS are entitled to partial indemnity costs, but argues that the amounts claimed are excessive. According to the Plaintiff the Defendant should receive an award of between $10,000 and $15,000, reduced to reflect the fact that the Defendant did not respond to the Plaintiff’s alleged efforts to compromise. (There were no offers to settle within the meaning of the Rules). The Plaintiff submits that IWS’s costs should be fixed in the amount of $3,960.00 before HST and disbursements. The Plaintiff filed a costs outline (which was not prepared in time for the hearing) showing that it would have claimed partial indemnity costs against the Defendant of $16,385.14 and partial indemnity costs against IWS of $1,898.91.

[7] The basis for the Defendant’s claim for substantial indemnity costs is what the Defendant alleges to be the baseless claims of deceitful and dishonest behaviour that the Plaintiff made against the Defendant. I agree that the Plaintiff did impugn the behaviour of the Defendant, but do not find that the allegations made rise to the level necessary to justify an award of substantial indemnity costs. Thus, I am awarding the Defendant its costs fixed on a partial indemnity basis.

[8] In term of quantum, this motion took almost a day to argue (although it was booked for half a day.). The Defendant filed one affidavit, two facta, attended at a short cross-examination and made one short court appearance prior to arguing the motion. Given this, I agree that the amount claimed for costs is excessive. However, I also agree that the motions were important and were of more than average complexity. Given this, and taking into account the reasonable expectation of the parties, I would fix the Defendant’s partial indemnity costs at $35,000.00, all inclusive. I reject the Plaintiff’s submission that the Defendant’s costs should be reduced because of a failure to compromise or because of its counsel’s conduct at the cross-examination.

[9] IWS seeks substantial indemnity costs on the basis that the Plaintiff’s motion against it had no chance of success and was brought for tactical reasons. I do not find that the Plaintiff’s actions in bringing the motion against IWS justify an award of substantial indemnity costs. While the motion was misguided, there was an ongoing arbitration where there was an overlap in terms of the facts. Thus, I am awarding IWS their costs fixed on a partial indemnity basis. In terms of quantum, IWS’s participation in the motion was very limited, although their counsel was required to be present in court for almost a full day. In my view, a more reasonable amount for IWS’s costs is $9,000.00.

[10] For these reasons the Plaintiff is ordered to pay the Defendant its costs fixed in the amount of $35,000.00 and IWS its costs fixed in the amount of $9,000.00.

H. Sachs J.

Date: January 28, 2019