COURT FILE NO.: CV-12-443718

DATE: 2019 11 29

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: CRIAG HURST, Plaintiff

- and -

JAMES HANCOCK, DARWIN PRODUCTIONS INC. and TRADEPOINT 360 INC., Defendants

BEFORE: Master Todd Robinson

COUNSEL: M. Singh, for the plaintiff and the plaintiffs in CV-15-533382 K. Marciniak, for the defendants, James Hancock and Darwin Productions Inc.

HEARD: October 25, 2019

COSTS ENDORSEMENT

[1] On October 25, 2019, I heard four motions in this action. Three of those motions were resolved with orders issued pursuant to my endorsement of that date: see Hurst v. Hancock, 2019 ONSC 6231. Those three motions, or portions of motions, were as follows:

(a) a motion by the defendants, James Hancock and Darwin Productions Inc. (the “Hancock Defendants”), for trial together of this action with a related action in CV-15-533382 (the “Pardee Action”), with common documentary and oral discoveries;

(b) the plaintiff’s prior cross-motion for trial together of this action with the Pardee Action and for leave to amend the statement of claim in this action; and

(c) a separate plaintiff’s motion for leave to amend the statement of claim.

[2] Following the hearing of all motions, I heard costs submissions of the plaintiff and the Hancock Defendants. These reasons determine costs of all of the motions before me on October 25, 2019, except for:

(a) one aspect of the plaintiff’s cross-motion originally returnable October 20, 2017, namely relief for transfer and consolidation of a related action commenced in the Orillia Small Claims Court, which is within the jurisdiction of a judge and has accordingly been adjourned to a judge for determination; and

(b) the fourth motion brought by Graham Partners LLP, Graham, Wilson & Green and HGR Graham Partners LLP, for which the decision was taken under reserve.

[3] Both the plaintiffs and Hancock Defendants seek their respective costs. The Hancock Defendants seek partial indemnity costs of $7,500, all-inclusive, on the basis that they were wholly successful in all of the motions and that the plaintiff has demonstrated a pattern of unreasonable conduct. The plaintiff seeks his partial indemnity costs to August 27, 2018 (the date of an offer to settle) and substantial indemnity costs from that date. However, no calculation of the costs claimed was provided. The costs outline provides only two “itemized” blocks covering all time spent for all three motions. The total partial indemnity costs claimed in the costs outline is $12,675.29 and the total substantial indemnity costs claimed is $18,237.77. The Hancock Defendants submit the plaintiff’s costs are excessive, particularly noting the disparity between the plaintiff’s disbursement claim and their own.

[4] In determining costs, Section 131 of the Courts of Justice Act, RSO 1990, c. C.43 and Rule 57.01 of the Rules of Civil Procedure, RRO 1990, Reg 194 afford broad discretion to fashion a costs award that the court deems fit and just in the circumstances. The general principles applicable when determining costs are well settled. Costs are discretionary. Rule 57.01 sets out factors to be considered by the court in exercising that discretion, which are in addition to considering the result of the proceeding and any written offers to settle. The court must also consider the overall objective of fixing an amount that is fair and reasonable in the particular proceeding, having regard to the expectations of the parties concerning the quantum of costs: Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 CanLII 14579 (ON CA), 71 OR (3d) 291 (CA) at paras. 26 and 38. I have considered all relevant factors in exercising of my discretion regarding costs.

[5] Plaintiff’s counsel did not have a copy of the offer to settle available for both opposing counsel and the court, and I denied the request to email a copy to me during or following the hearing. Plaintiff’s counsel verbally outlined the terms of the offer and submits that it was exactly what was ordered. Accordingly, plaintiff’s counsel submitted that all costs since August 2018 to today could have been avoided. Counsel for the Hancock Defendants submitted that, going from her memory of the proposal, that it was not a formal offer to settle and was framed as a “package deal” conditional on consent to the small claims action being transferred and consolidated without a $25,000 limit on damages. That issue remains in dispute and, as noted above, has been adjourned to be heard by a judge.

[6] Given the disagreement between counsel over the terms of the proposal/offer, and since it was not available for review, I give no weight to the fact that the plaintiff may have made an offer to settle these motions. In any event, the plaintiff’s costs outline has not been prepared in a way that would reasonably permit me to assess what costs were incurred prior to and following the proposal/offer. Given my determinations below, though, whether it was a formal offer to settle and whether there is a means by which costs may reasonably be apportioned to the pre-offer and post-offer periods is moot.

[7] Regarding the plaintiff’s first motion to amend the statement of claim (one of heads of relief sought in the plaintiff’s cross-motion, together with transfer of the Orillia Small Claims Court action and trial together with the Pardee Action), I see no basis for costs to be awarded against the Hancock Defendants. In my view, the costs of preparing that motion for leave to amend would have been incurred in any event. I was directed to nothing in the record to suggest that the Hancock Defendants unreasonably refused consent to that amendment. There is also nothing before me to suggest that the plaintiff incurred any additional costs in preparing and bringing that portion of the motion due to any position or conduct of the Hancock Defendants. In fact, it appears that the Hancock Defendants did not oppose that draft amendment of the statement of claim. Costs of that portion of the motion are properly in the cause.

[8] Regarding the plaintiff’s second motion to amend, which introduced additional amendments to pierce the corporate veil, the dispute as to costs is over the position originally taken by the Hancock Defendants. The plaintiff points to correspondence from the Hancock Defendants’ counsel confirming that the relief was originally to be opposed, although the correspondence also confirms that the Hancock Defendants would reconsider that position after determination of their summary judgment motion (which was ultimately successful in the first instance). Counsel for the Hancock Defendants point out that, within weeks of the Court of Appeal’s decision overturning the summary judgment decision, the Hancock Defendants consented to the amendment subject to terms that the amended statement of claim be a tracked-change version (rather than a fresh as amended version) and that the Hancock Defendants be afforded extra time to deliver an amended statement of defence in both this action and the Pardee Action. Counsel for the Hancock Defendants argues that, since summary judgment had been granted, there was no reason for the Hancock Defendants to consent to any amendment until the Court of Appeal overturned the summary judgment decision.

[9] The plaintiff’s position is that the language of Rule 26.01 is mandatory and that the position taken by the Hancock Defendants on conditions to providing consent was improper. The plaintiff submits that the Hancock Defendants were procedurally required to bring their own motion to extend the time to deliver an amended statement of defence in each action, and the fact that the court exercised its discretion to grant the Hancock Defendants that relief without a formal motion should not be a basis for costs against the plaintiff.

[10] In my view, the plaintiff’s position that the Hancock Defendants had no basis to make extension of the time to deliver their amended statements of defence a condition of consent is overly technical and contrary to Rule 1.04, which provides that the Rules of Civil Procedure “shall be liberally construed to secure the just, most expeditious and least expensive determination of every civil proceeding on its merits.” I do not view the Hancock Defendants’ request for an extended period to deliver amended statements of defence as unreasonable. The Hancock Defendants had no obligation to consent to the amendment. Despite an initial position of opposition until their summary judgment motion was determined, they did not ultimately oppose it. I see nothing improper with a defendant declining consent to an amendment motion, but not opposing it, and seeking relief from the court at the return of that motion regarding the timing of an amended statement of defence. That is what occurred here.

[11] I have also considered the timing of the plaintiff’s second amendment motion in assessing costs. In my view, it was strategically brought to have it before Justice Cavanagh concurrently with argument of the Hancock Defendants’ summary judgment motion. There is no reason to have otherwise brought an amendment motion returnable on the same date. Accordingly, in my view, costs of preparing the second amendment motion are not costs that should be recoverable from the defendant on this motion, since they are costs that would have been incurred in any event. They are properly claimed by the plaintiff as costs in the cause.

[12] Similarly, the Hancock Defendants’ costs of arguing for an extension in the time to deliver their amended statements of defence in this action and the Pardee Action without the need for a formal motion are not costs recoverable from the plaintiff as costs of the motion. They are also properly claimed as costs in the cause.

[13] Regarding the motions for trial together of this action with the Pardee Action, both the plaintiff and the Hancock Defendants seeks costs from the other for their respective motions. In assessing costs, it is significant that both the plaintiff and the Hancock Defendants moved for trial together. The only difference between the two motions is that the Hancock Defendants sought additional relief for common documentary and oral discoveries between both actions. On that issue, the parties ultimately agreed that there could be common discoveries and that time limits on examinations in each action need not be curtailed.

[14] Costs of neither motion were materially heightened by the negotiations and short submissions at the motion hearing regarding logistics of common oral discoveries. A motion needed to be brought for the relief in any event. The plaintiff brought the first motion with consent of the plaintiffs in the Pardee Action (who are represented by the same counsel). The need for a separate motion by the Hancock Defendants is unclear. In my view, though, both the plaintiff and the Hancock Defendants wanted trial together as evidenced by their respective motions. Neither substantively opposed the other motion. Practically, trial together with common discoveries provides time and cost efficiencies to the plaintiffs in both actions and to the Hancock Defendants. Such relief also makes sense to avoid inconsistent judicial findings on common issues. Put another way: the trial together and common discovery orders made are mutually beneficial to both sides.

[15] Since there was no substantive opposition by either side to the other side’s motion and the motions were mutually beneficial to both sides (as well as to the Pardee Action plaintiffs), it is appropriate that the plaintiff and the Hancock Defendants each bear their own costs of that mutually beneficial relief.

[16] Accordingly, having weighed the factors in Rule 57.01, and for the foregoing reasons, I accordingly order as follows:

(a) Costs incurred by both the plaintiff and the Hancock Defendants in respect of the plaintiff’s cross-motion to amend the statement of claim and the plaintiff’s second motion to amend the statement of claim shall be in the cause.

(b) The plaintiff and the Hancock Defendants shall each bear their own costs of their respective motions for trial together of this action with the Pardee Action.

(c) This order is effective without further formality.

MASTER TODD ROBINSON

DATE: November 29, 2019