Court File and Parties

COURT FILE NO.: CV-18-0033-00 DATE: 2020/05/15

ONTARIO SUPERIOR COURT OF JUSTICE

B E T W E E N:

DOMINIC PERODEAU and SCARLETT PERODEAU Plaintiffs – and – TD CANADA TRUST and TD INSURANCE Defendants

Counsel: Self-represented (for the Plaintiffs) Jeffrey Kukla, for the Defendant, TD Canada Trust Arie Odinocki and Bonnie Huen, for the Defendant, TD Insurance

HEARD: In Writing

COSTS ENDORSEMENT

Corthorn J.

Introduction

[1] The plaintiffs’ claims in this action were based on the alleged existence of fiduciary duties owed in relation to (a) home insurance on the plaintiffs’ residential property (“the Property”), and (b) the renewal of a mortgage on the Property (“the Mortgage”). The defendants were successful on their respective motions for summary judgment and the action was dismissed: Perodeau v. TD Canada Trust et al., 2020 ONSC 1542.

[2] Based on the history between the plaintiffs and each of the defendants, I did not expect that the parties would be able to resolve the issue of costs, assuming costs were pursued by the defendants. The defendants were to deliver written submissions in the event they intended to seek costs. Timelines were prescribed for the parties to exchange written submissions in that regard.

[3] The defendants seek their respective costs of the motions for summary judgment and of the action. TD Canada Trust (“the Bank”) relies on the terms of the Mortgage in support of its claim for costs on the full indemnity scale. The Bank seeks costs in the amount of $22,458.04, inclusive of fees, disbursements, and applicable HST.

[4] TD Insurance (“Primmum”) relies on r. 20.06 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, and seeks its costs on the substantial indemnity scale. Primmum seeks costs in the amount of $14,822.31 inclusive of fees, disbursements, and applicable HST.

[5] The Bank and Primmum each delivered written submissions. The plaintiffs did not deliver responding submissions. The entitlement of either defendant to costs is not in dispute. Regardless, it is necessary to consider the issues of scale and quantum. I deal first with costs claimed by the Bank and thereafter with those claimed by Primmum.

The Bank

a) Scale

[6] The Bank relies on paras. 9.03 and 11.01 of the Standard Charge Terms in support of its request for costs on the full indemnity scale. Those paragraphs provide as follows:

Paragraph 9.03

The Costs of any sale or foreclosure proceedings, whether or not the sale or foreclosure is completed, or any Costs that the Bank incurs in taking or keeping possession of the Property or enforcing its remedies under the Mortgage, are immediately payable by you whether or not any actual proceeding has commenced.

Paragraph 11.01

“Costs” means all of the fees, costs, charges and expenses relating to:

(xiii) all lawyers’ fees and disbursements (including those of the Bank’s inhouse lawyers) in any way relating to items (i) through (xii) on a full indemnity basis.

[7] The Bank submits that it is contractually entitled to its costs of the motion and of the action on the full indemnity scale. I agree. The plaintiffs shall pay the Bank its costs of the motion and of the action on the full indemnity scale.

b) Quantum

[8] The Bank seeks costs in the amount of $22,458.04. That amount is broken down as follows:

Fees $ 18,995.36 HST on fees $ 2,469.40 Disbursements (incl. HST) $ 993.28 Total $ 22,458.04

[9] The fees include $894.40 for work done on the written costs submissions. The HST on that amount is $116.27. It is not possible to determine which of the disbursements are related to the costs submissions – for example, copies and service. As a result, I treat costs requested by the Bank on the motion and for the action as $21,447.37 ($22,458.04 - $894.40 - $116.27), and those for costs submissions as $1,010.67.

i) Fees

[10] The fees for work on the motion and the action are $18,100.96 ($18,995.36 - $894.40). The fees reflect work by senior counsel (Mr. Kukla - 2009 Call) and junior counsel (Ms. Dies - 2018 Call). Their actual hourly rates are $331.26 and $100.00, respectively. I find that both rates are reasonable for counsel with their respective levels of experience.

[11] I find that the time docketed by each of senior counsel and junior counsel is reasonable, with the exception of three aspects of their work. First, I find that there is duplication of effort with respect to the preparation of the Bank’s statement of defence. The supervision of junior counsel by senior counsel is reasonable in the context of mentoring. It is not, however, reasonable to expect an opposing party to pay for that mentoring. I reduced the overall fees for the preparation of the statement of defence to take into consideration that duplication of effort and/or mentoring.

[12] Second, two hours are included for work by Z. Fayyaz at $150/hr. That work is described as “Prepared brief of authorities”. That timekeeper is not identified as counsel, nor is their involvement in the file explained. I eliminated the fees associated with the work by that individual.

[13] Third, senior counsel’s time includes 10 hours for “Preparation for and attendance at motion for summary judgment”. I note that counsel for Primmum docketed three hours for his attendance on the motion. Senior counsel’s time includes two other entries, totalling 7.5 hours, for preparation of submissions and other work in preparation for the motion.

[14] The office of the Bank’s counsel is located in Hamilton. No doubt the 10 hours docketed for the day of the return of the motions include travel time between Hamilton and Belleville, the latter being the city in which the motions were argued. The Bank is entitled to retain counsel from whatever location it chooses. It is not, however, reasonable for the Bank to expect that an opposing party will pay travel costs. I reduced the fees with respect to preparation time and travel on the day on which the motions were heard.

[15] Taking those three matters into consideration, I fix the fee portion of the Bank’s costs, on the full indemnity scale, for the motion and the action collectively, at $15,000 (exclusive of HST).

[16] I find that the fees with respect to costs submissions are reasonable. The Bank’s fees in that regard, on the full indemnity scale, are fixed at $895 (rounded figure and exclusive of HST).

ii) Disbursements

[17] The disbursements claimed total approximately $995. They include filing fees ($175 and $320), courier charges ($65.72), expenses for a process server/court filing ($211.26), and mileage ($221.30). I find all of the disbursements reasonable with the exception of mileage. For the reasons set out above, it is not reasonable for the Bank to expect the plaintiffs to pay for travel expenses.

[18] The Bank’s disbursements are fixed in the amount of $775 (inclusive of HST).

c) Summary

[19] The plaintiffs shall pay the Bank its costs of the motion, the action, and the written costs submissions, on the full indemnity scale, in the amount of $19,035. That amount is calculated as follows:

Fees Motion and Action $ 15,000.00 Costs Submissions $ 895.00 Sub-total (fees) $ 15,895.00 HST on fees $ 2,366.35 Disbursements (incl. HST) $ 775.00 Total $ 19,036.35 Rounded to $ 19,035.00

Primmum

a) Scale

[20] Primmum seeks its costs of the motion and of the action on the substantial indemnity scale. Primmum relies on (a) rr. 20.06 and 57.01(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, and (b) the conduct of the plaintiffs in responding to Primmum’s motion.

[21] I consider Primmum’s costs of the motion as distinct from its costs of the action. I turn first to costs of the motion.

[22] Subrule 20.06 provides that costs for a motion for summary judgment may be fixed on the substantial indemnity scale if either “(a) the party acted unreasonably by making or responding to the motion; or (b) the party acted in bad faith for the purpose of delay.” Primmum submits that the plaintiffs acted unreasonably in responding to Primmum’s motion for summary judgment.

[23] Primmum submits that the plaintiffs’ unreasonable conduct includes their failure to offer any evidence in response to the motion, specifically in light of (a) their prior experience as litigants, (b) their understanding of the process, as demonstrated by their historical conduct as litigants, and (c) the fact that they had more than three months’ notice of Primmum’s motion.

[24] Acting “unreasonably” includes relying on evidence that is “clearly insufficient to show facts on which the court could conclude that there [is] no genuine issue requiring a trial”: Ashim v. Zia, 2015 ONSC 564, 42 C.C.L.I. (5th) 48, at para. 9. The plaintiffs failed to deliver a responding record that included affidavit evidence. I agree with Primmum and find that the plaintiffs’ lack of a meaningful response to Primmum’s motion amounts to “unreasonable” conduct within the meaning of r. 20.06.

[25] Primmum is entitled to its costs of the motion on the substantial indemnity scale.

[26] With respect to the scale applicable for costs of the action, Primmum relies on the outcome on the motion for summary judgment. Primmum submits that the outcome on the motion demonstrates that the statement of claim disclosed no reasonable cause of action against it.

[27] I find that the outcome on the motion is reflected in the award of costs on the substantial indemnity scale for the motion. Primmum has not satisfied me that there is anything in the plaintiffs’ conduct related to the action in general that supports an award of costs, for the action, on the substantial indemnity scale. The plaintiffs shall pay Primmum its costs of the action on the partial indemnity scale.

b) Quantum

[28] Primmum seeks its costs (on the substantial indemnity scale) in the amount of $14,822.31. That amount is broken down as follows:

Fees $ 11,893.00 HST on fees $ 1,546.09 Disbursements (incl. HST) $ 1,303.22 Total $ 14,822.31

i) Fees on the Motion

[29] From the fees totalling $11,893, I remove $2,088 related to pleadings in the action and $2,002 related to the costs submissions. The substantial indemnity fees sought by Primmum on the motion are $7,800 (rounded figure).

[30] The fees are based on an actual hourly rate of $315 for senior counsel (Mr. Odinocki – 2001 Call) and $225 for associate counsel (Ms. Yuen – 2009 Call). Primmum relies on 80 per cent of the actual rates to calculate the substantial scale rates. I find the actual and substantial scale rates are reasonable. I also find the time docketed with respect to the motion reasonable. I see no basis for a reduction from the $7,800 in substantial indemnity scale fees on the motion. I therefore fix Primmum’s fees for the motion at $7,800 (exclusive of HST).

ii) Fees for the Action

[31] With respect to the action, the fees based on actual rates total $2,610. The time docketed is reasonable. The partial indemnity fees awarded for the action are $1,565 ($2,610 x 0.6, and exclusive of HST).

iii) Fees for Costs Submissions

[32] The fees claimed for the costs submissions are $2,002, on the substantial indemnity scale. The vast majority of the work done on Primmum’s behalf relates to the motion for summary judgment. The outcome on that motion entitled Primmum to costs. It is reasonable to fix costs of the costs submissions on the substantial indemnity scale.

[33] The fees incurred by Primmum for its costs submissions are approximately double those incurred by the Bank. That difference is explained by the following. First, the Bank’s submissions were succinct because it relied on contractual terms in support of its request for costs on the full indemnity scale. Primmum’s costs submissions were, of necessity, more detailed.

[34] Those submissions included references to several cases and to the Rules. In Primmum’s bill of costs, the fees were grouped and summarized based on the nature of the work. The Bank, on the other hand, relied on counsel’s complete time dockets, without grouping or summarizing them by nature of the work done. The approach taken by Primmum’s counsel required more work.

[35] For Primmum’s costs submissions, I find the fees claimed of $2,000 (rounded figure and exclusive of HST) reasonable and fix them in that amount on the substantial indemnity scale.

iv) Disbursements

[36] The disbursements claimed total approximately $1,385 (including HST). They include a filing fee ($175), the cost of a transcript from a prior proceeding ($225.70), a process server ($733.15), printing ($195.88), and courier charges ($53.49).

[37] The process server expenses are approximately 3.5 times those incurred by the Bank. No explanation for the process server expenses is provided. I find the amount to be high. I reduce the disbursements allowed and fix them in the total amount of $1,000 (inclusive of HST).

c) Summary

[38] The plaintiffs shall pay Primmum its costs of the motion, action, and costs submissions in the amount of $13,840. That amount is calculated as follows:

Fees Motion (substantial) $ 7,800.00 Action (partial) $ 1,565.00 Costs (substantial) $ 2,000.00 Sub-total (fees) $ 11,365.00 HST on fees $ 1,477.45 Disbursements (incl. HST) $ 1,000.00 Total $ 13,842.45 Rounded to $ 13,840.00

Rule 57.01 – Factors

[39] I am satisfied that, when the factors pursuant to r. 57.01(1) are considered, the fees and disbursements fixed in the preceding sections of this endorsement are reasonable. Addressing those factors in a summary way,

• The fees and disbursements awarded are within the range that the plaintiffs could reasonably have expected to pay (r. 57.01(1)(0.b));
• The Mortgage was in the principal sum of $200,000. The plaintiffs claimed damages of $1,200,000 related to a fire loss at the Property. The fees awarded are entirely proportional to the amount claimed (r. 57.01(1)(a)); and
• In addition to seeking damages, the plaintiffs sought to prevent the Bank from proceeding with its rights of enforcement, rights arising from the Bank’s success in a prior proceeding. I find that conduct unnecessarily lengthened the overall enforcement proceedings (r. 57.01(1)(e)).

Disposition

[40] The plaintiffs shall pay to the defendants, their respective costs as follows: (a) to the Bank, the sum of $19,035; and (b) to Primmum, the sum of $13,840. Both amounts are inclusive of fees, disbursements, and applicable HST.

[41] As a result of the suspension of usual court operations, this endorsement is being issued under my electronic signature. Once normal operations resume, a copy of this endorsement shall be added to the court file.

[42] Because of the Covid-19 emergency, the order with respect to costs will be made under my electronic signature. This order shall be effective, binding, and enforceable without further formality at this time. Once normal operations resume, a copy of the order shall be filed with the Court.

[43] Also because of the Covid-19 emergency and the plaintiffs’ failure to participate in the costs portion of the proceeding, it is reasonable to dispense with the requirement for the defendants to seek the plaintiffs’ approval, as to form and content, with respect to the order as to costs. Therefore, if the defendants intend to have an order with respect to costs issued and entered, the defendants shall (a) agree upon the terms of a draft order, and (b) forward the draft order to my Judicial Assistant by email, as an attachment in Word format.

[44] I wish to thank counsel for the Bank and for Primmum for their respective succinct and well-prepared costs submissions.

Madam Justice Sylvia Corthorn Released: May 15, 2020