Attorney General of Ontario v. $32,125.00 In Canadian Currency (In Rem)

Court File No.: CV-17-306-000 Date: 2020-05-05

ONTARIO SUPERIOR COURT OF JUSTICE

B E T W E E N:

Attorney General of Ontario Applicant (Sara MacDonald, counsel for the Applicant)

- and -

$32,125.00 In Canadian Currency (In Rem) Respondent (Allister McGillivray, counsel for James Wright, interested party Respondent)

HEARD: In Writing at Thunder Bay, Ontario

BEFORE: Madam Justice T. J. Nieckarz

Decision On Costs

Overview

[1] This decision on costs relates to the Application of the Attorney General of Ontario (“AGO”) for forfeiture of $32,125 CAD (the “Funds”). That Application was heard on September 18, 2019.

[2] For reasons delivered in Attorney General of Ontario v. $32,125 in Canadian Currency (In Rem), 2020 ONSC 455, I granted the Applicant’s request for a forfeiture order of the Funds.

[3] As part of my decision I invited submissions as to costs. The Applicant seeks costs of the Application, fixed in the amount of $3,500 inclusive of fees, disbursements and H.S.T.

[4] The Respondent submits that the Court should exercise its discretion to deny the Applicant’s request for costs. He argues that:

a. As the successful party, the Applicant received forfeiture of the Funds, along with accrued interest, which is a windfall and is more than sufficient to cover the costs of the AGO; and

b. The Respondent is a person of limited means and as such, any costs award will negatively impact his ability to afford the necessities of life. In balancing the competing interests of the Respondent’s limited means against the successful party’s right of indemnification, the Court should favour the Respondent.

[5] For reasons that follow, the interested party Mr. James Wright shall pay to the Applicant the sum of $3,500 on account of costs.

The Law

[6] An award of costs is in the discretion of the court by virtue of s. 131(1) of the Courts of Justice Act.

[7] The discretion of the court is to be exercised in light of the facts and circumstances of the case in relation to the factors provided for in Rule 57.01(1) of the Rules of Civil Procedure:

57.01 (1) In exercising its discretion under section 131 of the Courts of Justice Act to award costs, the court may consider, in addition to the result in the proceeding and any offer to settle or to contribute made in writing,

(0.a) the principle of indemnity, including, where applicable, the experience of the lawyer for the party entitled to the costs as well as the rates charged and the hours spent by that lawyer;

(0.b) the amount of costs that an unsuccessful party could reasonably expect to pay in relation to the step in the proceeding for which costs are being fixed;

(a) the amount claimed and the amount recovered in the proceeding;

(b) the apportionment of liability;

(c) the complexity of the proceeding;

(d) the importance of the issues;

(e) the conduct of any party that tended to shorten or to lengthen unnecessarily the duration of the proceeding;

(f) whether any step in the proceeding was,

(i) improper, vexatious or unnecessary, or

(ii) taken through negligence, mistake or excessive caution;

(g) a party’s denial of or refusal to admit anything that should have been admitted;

(h) whether it is appropriate to award any costs or more than one set of costs where a party,

(i) commenced separate proceedings for claims that should have been made in one proceeding, or

(ii) in defending a proceeding separated unnecessarily from another party in the same interest or defended by a different lawyer; and

(i) any other matter relevant to the question of costs.

[8] Evidence of impecuniosity is a factor to take into consideration: Tarion Warranty Corporation v. 1486448 Ontario Inc., 2012 ONCA 288 at para. 6.

[9] A costs award must be fair and reasonable. It should not merely be a calculation of the hours spent, but also reflect the reasonable expectations of the parties. An award of costs should seek to balance the indemnity principle with the fundamental objective of access to justice: Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291 (C.A.) at paras. 37-38; Andersen v. St. Jude Medical Inc. at para. 22.

Analysis

[10] It is undisputed that the AGO was the successful party on the Application. The question becomes whether Mr. Wright’s limited means should result in fully depriving the AGO of its costs. I find that it should not.

[11] This was an Application that took one-half day to argue. The materials were voluminous. There were cross-examinations that took place, transcripts required, and further affidavits filed following cross-examinations. This matter was not determined on the first return date, and various adjournments were required at the request of Mr. Wright. Factums and books of authorities were filed. AGO counsel travelled to Thunder Bay for the hearing and incurred the necessary disbursements.

[12] It is clear that significant costs have been incurred by both parties in the prosecution and defence of the Application. I accept that Mr. Wright’s means is a proper factor to consider when weighing all the relevant factors. Had the AGO sought costs in a greater amount, I may have been more inclined to accept that a reduction in the amount claimed should be considered given Mr. Wright’s limited means. The amount claimed is already extremely modest as is. I find it to be fair and reasonable and that there is no need for any further reduction.

[13] I also accept the AGO’s argument that while impecuniosity is a relevant factor in assessing costs, it is not, by itself a basis for relieving a party fully of the responsibility for costs. It is only in rare cases that a successful party should be deprived of costs. There is no conduct that I am aware of that would warrant depriving the AGO of its costs. See: Ogoki Frontier Inc. v. All AIR Ltd., [2005] O.J. No. 99 at paras. 7 – 10; Tarion Warranty Corp. v. 1486448 Ontario Inc., at para. 6.

[14] In awarding the AGO the costs sought, in addition to the means of Mr. Wright I have considered the results of the proceeding, the principle of indemnity, the principle of proportionality, and the conduct of the parties. I have also taken into consideration that more than a year prior to the hearing of the Application, the AGO served an Offer that sought to resolve the matter on terms less favourable to it than that which was achieved at the hearing.

[15] I also do not find it appropriate to deprive the AGO of its costs simply because the result of the proceeding is the forfeiture of funds belonging to Mr. Wright. Counsel for Mr. Wright provided no caselaw authority for this proposition. The fact remains that the AGO is the successful party.

[16] Mr. James Wright shall pay to the Applicant costs in the amount of $3,500 inclusive.

“Original signed by” The Honourable Madam Justice T.J. Nieckarz

Released: May 5, 2020

COURT FILE NO.: CV-17-306-000 DATE: 2020-05-05 ONTARIO SUPERIOR COURT OF JUSTICE B E T W E E N: Attorney General of Ontario Applicant - and - $32,125.00 In Canadian Currency (In Rem) Respondent DECISION ON COSTS Nieckarz J. Released: May 5, 2020 /lvp