London Eco-Roof Manufacturing Inc. v. Syson, 2020 ONSC 3101

COURT FILE NO.: 915/13

DATE: 2020/05/19

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: LONDON ECO-ROOF MANUFACTURING INC.

Plaintiff

AND:

KRZYSZTOF KAZIMIERZ SYSON and THE TORONTO-DOMINION BANK[^1]

Defendants

BEFORE: Justice I.F. Leach

COUNSEL: Ciara L. Pittam, for the plaintiff

Dagmara W. Wozniak, for the defendant Mr Syson

HEARD: In writing

Endorsement

Costs of action

Introduction

[1] On March 2, 2020, I released my judgment in relation to this matter.

[2] The nature of and background to the plaintiff’s claim and the defendant Mr Syson’s counterclaim, including the precise relief each party was seeking, and the evidence and reasons offered in support of their competing positions, were described at length in my judgment, since reported as London Eco-Roof Manufacturing Inc. v. Syson, 2020 ONSC 1338.

[3] I accordingly will not attempt any kind of detailed recitation here of that earlier information. For present purposes, the events leading to this endorsement may be summarized broadly as follows:

a. In January of 2013, the parties entered into a written contract whereby the plaintiff, London Eco-Roof Manufacturing Inc., (“LER”), was to install a metal roof on the house and personal residence of the defendant Mr Syson. The originally agreed contract price was $20,000, and there was no dispute that Mr Syson, over time, paid $10,000 of that price by way of two $5,000 instalments.

b. Work on the roof installation proceeded in January and February of 2013.

c. By April of 2013, an irreconcilable dispute had emerged between the parties, whereby LER essentially took the position that work on installation of the roof had been completed without any deficiencies, and Mr Syson took the position that the work done was incomplete and/or deficient in many respects. LER correspondingly took the position that it was entitled to full payment of all contractual amounts owed by Mr Syson, while he refused to make any further payments until his concerns had been addressed to his satisfaction.

d. In April of 2013, LER proceeded to register, (and subsequently perfect), a construction lien against title to Mr Syson’s home, pursuant to what was then the Construction Lien Act, R.S.O. 1990, c.C.30. In its lien and thereafter, LER took the position that Mr Syson owed LER payment of a further $15,000 beyond the $10,000 already paid.

e. Over time and at trial, LER made clear its firm position that all required work had been completed without any deficiencies or failings, and that Mr Syson not only owed LER a further $10,000 in relation to the originally agreed contract price, but an additional $5,000 pursuant to an alleged oral agreement whereby LER would alter already completed aspects of the metal roof in exchange for Mr Syson paying that additional amount.

f. Over time and at trial, Mr Syson made clear his firm position that he had never agreed to payment of anything but the $20,000 specified in the original written contract, and that the metal roof installed by LER and the manner of its installation were so flawed and deficient that complete removal and replacement of the roof were required; i.e., such that he not only had no obligation to pay LER anything further, but that LER in fact owed him substantial monetary compensation sufficient to address and remedy all such failings and deficiencies.

g. The dispute between the parties, and their respective positions, were reflected in a formal claim by LER and formal counterclaim by Mr Syson, which proceeded to occupy 11 days of trial before me. In the course of that trial, the parties asked that I address and resolve no less than 32 specific issues en route to making an overall determination of what sums, if any, were owed to each party by the other.[^2]

h. Owing to various complications noted on the record, the trial proceeded to completion intermittently in April and December of 2018, and June of 2019.

i. On March 2, 2020, I rendered a lengthy (133 page) judgment, addressing and resolving each of the specific issues raised by the parties, in turn leading to my overall judgment:

i. that Mr Syson had a continuing obligation to pay LER the remaining $10,000 balance not yet paid in relation to the $20,000 roof installation price agreed upon by the parties in their original written contract, but no obligation to pay the further $5,000 claimed by LER in relation to the supplementary oral agreement alleged by LER, which LER had failed to establish;

ii. that against that $10,000 obligation Mr Syson owed to LER, he was entitled to set-off a global allowance of $4,000 for damages sustained as a result of established functional and cosmetic deficiencies in the installed room, (constituting breaches of contract on the part of LER), failure by LER to clean up its worksite, (constituting a further breach of contract on the part of LER), and the destruction of an ornamental statue, (constituting negligence on the part of LER);

iii. that, through the application of set-off, Mr Syson accordingly was obliged to pay LER the net sum of $6,000; and

iv. that, upon payment of that $6,000 sum by Mr Syson to LER, the lien securing LER’s claim against Mr Syson was to be vacated.

[4] Because my judgment was reserved, the parties had no opportunity to address costs at the conclusion of trial, and my judgment therefore invited written cost submissions, pursuant to an indicated timetable, if the parties were unable to reach an agreement on entitlement and/or quantum in that regard.

[5] The parties were not able to settle issues relating to costs, and written costs submissions were tendered accordingly. In particular:

a. initial cost submissions tendered on behalf of LER, (including submissions, a Bill of Costs, a Rule 49 settlement offer, cost-related correspondence exchanged between the parties and a number of authorities), were delivered on or about March 12, 2020;

b. responding cost submissions tendered on behalf of Mr Syson, (including submissions, a Rule 49 settlement offer, material filed by Mr Syson in relation to a pretrial motion brought by Mr Syson to set aside a default judgment, a Bill of Costs and numerous authorities), were delivered or about March 26, 2020; and

c. reply cost submissions tendered on behalf of LER were delivered on or about April 1, 2020.

[6] My receipt and review of those cost materials nevertheless were then the subject of some additional delays occasioned by the current COVID-19 pandemic.

Party positions

[7] I now have reviewed and considered the above cost submissions and supporting material in detail and at length, and the following overview should not suggest otherwise. In broad terms, however, the parties’ respective positions may be summarized as follows:

a. LER submits that it was the successful party in the litigation, and seeks an all-inclusive cost award, (i.e., addressing all of its claims for legal fees, disbursements and applicable HST), of $47,167.40 on a partial indemnity basis.

b. Mr Syson submits that there was divided success at trial, and that it would be appropriate in the circumstances that no costs be awarded to either party; i.e., that the court effectively should order the parties to bear their own costs of the action. In the alternative, Mr Syson submits that any cost award should be negligible, (e.g., no more than $3,000 to $4,000), having regard to the reality that the overall outcome of the litigation was an award of $6,000.

General Principles

[8] Before further consideration and assessment of the cost positions outlined above, I pause to outline a number of general principles applicable to such cost determinations.

[9] Subsection 131(1) of the Courts of Justice Act, R.S.O. 1990, c.C.43, as amended, provides as follows: “Subject to the provisions of an Act or rules of court, the costs of and incidental to a proceeding or a step in a proceeding are in the discretion of the court, and the court may determine by whom and to what extent the costs shall be paid”.

[10] That general direction from the Legislature is supplemented, as far as “the rules of court” are concerned, by provisions including those set forth in Rule 57.01, subsection (1) of which lists a broad range of factors the court may consider “when exercising its discretion to award costs pursuant to section 131 of the Courts of Justice Act”, supra. The rules of court also contain further provisions, (e.g., those set forth in Rule 49 addressing the possible cost implications of settlement offers), which also may have a bearing on cost determinations made in the context of civil litigation.

[11] However, as noted above, the Legislature’s general direction regarding cost determinations, set forth in s.131(1) of the Courts of Justice Act, supra, is also expressly made subject to the provisions of any other Act. In this case, as the plaintiff’s claim was advanced pursuant to the Construction Lien Act, supra, cost determinations made by the court also are governed by section 86 of that Act as it read on June 28, 2018.[^3] On that date, section 86 of the legislation, dealing with costs, read as follows:

86. (1) Subject to subsection (2), any order as to the costs in an action, application or settlement meeting is in the discretion of the court, and an order as to costs may be made against:

a. a party to the action or motion; or

b. a person who represented a party to the action, application or motion, where the person,

i. knowingly participated in the preservation or perfection of a lien, or represented a party at the trial of an action, where it is clear that the claim for a lien is without foundation or is for a grossly excessive amount, or that the lien has expired; or

ii. prejudiced or delayed the conduct of the action;

and the order may be made on a substantial indemnity basis, including where the motion is heard by, or the action has been referred under section 58 to, a master, case management master or commissioner.

(2) Where the least expensive course is not taken by a party, the costs allowed to the party shall not exceed what would have been incurred had the least expensive course been taken.[^4]

[12] Decisions commenting on the effect of such provisions in the Construction Lien Act, supra, have held:

a. that the provisions confirm the court’s broad discretion regarding costs in relation to such matters, with the only express restriction on that discretion being whether a party otherwise entitled to costs has failed to take “the least expensive course” of action, in which case the award should not exceed what the costs would have been had the least expensive course been taken;

b. that provisions of the Rules of Civil Procedure not inconsistent with such provisions of the Construction Lien Act, supra, including most provisions of Rule 49 and the provisions of Rule 57, nevertheless still apply to proceedings under the Construction Lien Act, supra; and

c. that, while the mandatory provisions of Rule 49.10 are not binding on the court in the context of proceedings under the Construction Lien Act, supra, (as that would represent a further limitation on the court’s discretion not consistent with the express provisions of s.86 of the legislation), courts can and do take into consideration whether offers to settle were more or less favourable than the litigated outcome, and what the effect of Rule 49 would have been, when exercising the court’s discretion on costs in relation to construction lien matters.[^5]

[13] More generally, however, our courts repeatedly have emphasized that cost awards must not be a simple mechanical or mathematical calculation; e.g., focused merely on details of time spent multiplied by hourly rates, or a tabulation of disbursements actually incurred.

[14] Rather, all cost claims are subject to the “overriding principle of reasonableness”, as applied to the factual matrix of the case, pursuant to a required ultimate “cross check” in that regard.[^6]

[15] The overall goal is to award costs in an amount that is “fair and reasonable for the unsuccessful party to pay in a particular proceeding”, rather than a sum tailored to an exact measure of the actual costs of a successful litigant.[^7]

[16] With the above principles in mind, I turn to determination of an appropriate cost disposition in relation to this particular litigation.

Analysis

[17] In arriving at a global determination of a cost disposition that would be fair and reasonable in this case, having regard to all the circumstances, my considerations include but are not limited to those outlined below.

PRINCIPLE OF INDEMNITY – RULE 57.01(1)(0.a)

[18] Rule 57.01(0.a) permits the court to consider, in exercising its cost discretion, “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”.

[19] As for the experience of the lawyers involved in this matter and the rates that they charged:

a. The Bill of Costs filed on behalf of the plaintiff indicates that LER claims reimbursement work done almost exclusively by two lawyers; i.e., Jeremy Forest, (called to the bar in 2006), and Ciara Pittam, (called to the bar in 2015), with responsibility for the matter apparently being delegated to the more junior and less expensive Ms Pittam as the matter moved towards and through trial.[^8] Over the course of the litigation, the actual hourly rate charged by Mr Forrest increased progressively from $275 to $290, and from $290 to $310. The actual hourly rate of Ms Pittam increased progressively from $135 to $200, and from $200 to $210. The partial indemnity rates used in the Bill of Costs calculations were 60 percent of the relevant lawyers’ actual hourly rates.

b. The Bill of Costs filed on behalf of the defendant, (which was accompanied by a print out of the relevant underlying docket entries), indicates that Mr Syson had legal work done for him on this matter by three lawyers, (called to the bar between 2009 and 2017), two articling students and 13 law clerks. The actual hourly rates charged by each are particularized in the Bill of Costs, but for present purposes may be summarized as follows: the actual hourly rates charged by lawyers varied from a low of $165 to a high of $250; the time of articling students was charged at $150 per hour; and the actual hourly rates charged for work done by law clerks varied from a low of $80 to a high of $195. The individual doing the most work on the file was Dagmara Wozniak, (called to the bar in 2009 and the most senior lawyer on the file), who commendably reduced her hourly rate actually charged to Mr Syson to $250 for the duration of the litigation, even though her normally charged hourly rate had risen to $325 in 2017, $350 in 2018 and $375 in 2019. The partial indemnity hourly rates employed in preparation of the Bill of Costs filed on Mr Syson’s behalf were set at 65 percent of those actual hourly rates.

[20] Neither party questioned the actual or partial indemnity rates charged by lawyers, students and/or law clerks employed by the other.

[21] For the most part, I independently find those rates to be appropriate. However, the charging of partial indemnity hourly rates exceeding 60 percent of actual hourly rates is generally a cause for concern,[^9] and I think it would have been appropriate for the partial indemnity rates used in the Bill of Costs for Mr Syson to be capped accordingly.

[22] As for the hours spent on the matter, they are particularized in each party’s material, (i.e., with specific indications of what individual spent how much time on separately indicated tasks), and they are substantial. Using the rates noted above, and without including/adding applicable HST:

a. LER indicated, in its Bill of Costs, that its legal representatives devoted $66,190.00 worth of time to the matter on a full indemnity basis, and $39,714.00 worth of time to the action on a partial indemnity basis; and

b. Mr Syson indicated, in his Bill of Costs, that his legal representatives devoted $80,251.00 worth of time to the matter on a full indemnity basis, and $52,163.15 worth of time to the matter on a partial indemnity basis.

[23] In that regard, I am mindful of the general admonition, voiced by Justice Nordheimer (as he then was) in Basedo v. University Health Network, [2002] O.J. No. 597 (S.C.J.), but embraced by our Court of Appeal in Boucher v. Public Accountants Council (Ontario), supra, at paragraph 26, that “it is not the role of the court to second-guess the time spent by counsel unless it is manifestly unreasonable in the sense that the total time spent is clearly excessive or the matter has been overly lawyered”.

[24] I accordingly am not inclined to question the time spent on the matter by each side, subject to the following caveats:

a. In my view, such an approach obviously does not negate the reality that cost recovery is still subject to modification and limitation, having regard to:

i. other Rule 57.01 considerations;

ii. the need for proportionality, implicit in some of those Rule 57.01 considerations, and explicit in Rule 1.04(1.1);

iii. the broad discretion conferred by section 131 of the Courts of Justice Act, supra, and s. 86 of the Construction Lien Act, supra; and

iv. the “overriding principle of reasonableness” noted above.

b. While I think it commendable that plaintiff counsel clearly delegated most work on the matter from a more senior lawyer to a more junior one as the litigation progressed, I find it troubling, (especially given the sums in dispute in this litigation), that there are almost no indications, (i.e., barring the possible isolated one noted above), that any work was entrusted to articling students, paralegals or law clerks.

c. Conversely, while I think it commendable that defence counsel clearly and frequently delegated work to many individuals within her firm who were charging lower hourly rates, I also think the sheer number of individuals working on the file gives rise to an inference that there probably was some degree of inefficiency and/or duplication of effort as each newly involved individual necessarily would have required instruction and time to familiarize himself or herself with the matter; instructions and time which could have been reduced had the matter been dealt with repeatedly by a more limited number of persons.

d. The Bill of Costs filed on behalf of LER indicates that costs are being claimed in relation to various discrete interlocutory steps in respect of which I think the opportunity to seek and recover costs arguably has passed. For example, LER’s current Bill of Costs includes time spent on the following matters: bringing an ex parte motion to permit substitute service; obtaining a default judgment against Mr Syson, based on that substitute service, and attempting to enforce that default judgment; dealing with a motion by Mr Syson to have that resulting default judgment set aside; pursuit and discontinuance of LER’s formal claim against the Toronto-Dominion Bank; dealing with a motion brought by Mr Syson relating to satisfaction of undertakings; preparation of a motion to adjourn the trial; and dealing with a motion brought by Mr Syson to amend pleadings. In my view, LER should not be claiming or recovering costs for such matters at this stage of the litigation. There are various reasons for my holding that view, but they include the following:

i. Pursuant to Rule 57.03(3) of the Rules of Civil Procedure, on a motion made without notice, (such as a motion for an order permitting substitute service), there shall be no costs awarded to any party, unless the court orders otherwise. In this case, the judge dealing with the plaintiff’s motion for an order permitting substitute service apparently refrained from ordering any payment of costs in relation to that motion. When an endorsement or order dealing with an interlocutory step in a proceeding is silent as to costs, it effectively is an order for no costs, and costs not awarded in relation to an interlocutory step in a proceeding accordingly cannot be claimed at the conclusion of the proceeding.[^10] In any event, I think it would be inappropriate to order Mr Syson to pay the costs of the plaintiff’s motion for substitute service, as later developments, (confirmed during the interlocutory proceedings to have the default judgment against Mr Syson set aside), demonstrated and confirmed that the method of substitute service proposed and employed by LER was completely ineffective in terms of bringing LER’s formal claim to the actual attention of Mr Syson, in turn leading to wasted time and expense on behalf of all concerned.

ii. Mr Syson’s motion for an order setting aside default judgment, and allowing him to file a defence, ended with his being permitted to do so. If LER wanted Mr Syson to pay for the costs associated with its abortive efforts to obtain and enforce a default judgment, (e.g., as a term of the default judgment being vacated and Mr Syson being permitted to file a statement of defence), I think the time for advancing such cost claims was then and not now. I received no indication that the costs of that motion had been reserved to the trial judge, (by agreement or court order), and in my view that figurative “cost claim ship” accordingly sailed long ago.

iii. In my view, LER is also precluded from now advancing, belatedly, a claim for costs associated with pursuit and withdrawal of its claim against the Toronto-Dominion bank. As noted in my judgment, Rule 23.05(1) of the Rules of Civil Procedure reads as follows: “If all or part of an action is discontinued, any party to the action may, within thirty days after the action is discontinued, make a motion respecting costs of the action.” That was one of the reasons why Mr Syson was not permitted to claim any costs associated with LER’s discontinued claim against the Toronto-Dominion bank, long after thirty days had passed since LER discontinued that claim, without Mr Syson bringing a motion for such costs. The same reasoning prevents LER from now claiming any of its costs related to that discontinued claim.

iv. As noted in Mr Syson’s cost submissions, Justice Rady made an order formally resolving the defendant’s motion for satisfaction of undertakings, and that order included an award of costs relating to that motion. The issue of costs associated with that motion accordingly is res judicata, and LER should not be allowed to revisit and reopen that issue now by claiming reimbursement for legal costs it incurred in relation to that undertakings motion.

v. For similar reasons, I do not think LER should be permitted to belatedly seek costs in relation to its motion to adjourn the trial, or Mr Syson’s motion to amend his pleading. Those interlocutory motions were dealt with by the court before trial, and I was not provided with anything to indicate that costs of either motion were reserved to the trial judge. For the reasons noted above, if the judge or judges dealing with those motions said nothing about the costs associated with the motions, the relevant endorsements must be read as ordering no costs of either interlocutory step, and such costs accordingly may not be claimed by LER now.

e. The Bill of Costs and supporting dockets filed on behalf of Mr Syson raise concerns similar to those identified in the previous sub-paragraph, insofar as the suggested costs of the action from Mr Syson’s perspective also seem to include legal fees incurred in relation to interlocutory steps which, in my view, are not properly claimable at this stage of the proceedings. For example, the dockets entries offered in support of Mr Syson’s Bill of Costs include entries apparently relating to:

i. LER’s claim against the Toronto-Dominion Bank and/or Mr Syson’s counterclaim for recovery of expenses related to that claim, including correspondence and research concerning the possibility of an applicable limitation period;

ii. correspondence exchanged with plaintiff counsel relating to one or more interlocutory orders obtained by way of a motion or motions;

iii. work done and correspondence exchanged in connection with Mr Syson’s motion to compel satisfaction of LER’s undertakings; and

iv. work done in relation to Mr Syson’s motion to amend his pleading.

[25] Beyond the matter of legal fees, I note that neither party questioned the disbursements incurred by the other; i.e., the disbursements described in each party’s Bill of Costs. In that regard:

a. LER was said to have incurred $3,571.29 in claimable disbursements, not including applicable HST; and

b. Mr Syson was said to have incurred $23,160.14 in claimable disbursements, not including applicable HST.

[26] Having reviewed those disbursements:

a. Subject to the qualifying remarks that follow, I independently find most of them to be relevant and appropriate disbursements in respect of which I would be inclined to direct reimbursement, even if some fall outside the Tariff of disbursements that would be claimable on an assessment. Without limiting the generality of the foregoing, I am not inclined to question the expert fees paid by Mr Syson, which no doubt relate to work done by Mr Flynn. In that regard:

i. Although I did not accept many aspects of Mr Flynn’s expert opinion evidence, (for the reasons indicated in my judgment), in my view that evidence, along with the copy of Mr Flynn’s report tendered as an aide memoire for the court, reflected investigation and preparation that was clearly extensive, considered and well-organized. The fees apparently charged by Mr Flynn are consistent with my experience of fees charged by other engineering experts for comparable work.

ii. Although Mr Syson incurred a formal disbursement for work done by an expert witness and LER did not, that consideration alone does not suggest to me that the disbursement incurred by Mr Syson was unnecessary or inappropriate in the circumstances. For the reasons noted in my judgment, LER did not retain an independent expert witness because it was able to rely instead on the lay opinion evidence of its witnesses in relation to metal roofing installation standards, metal roofing structures and mould.

b. In my view, LER nevertheless should not be claiming, in the current context, disbursements incurred in having its default judgment issued, or disbursements incurred in issuing and filing a writ of seizure and sale in an effort to enforce that default judgment. For the reasons outlined above, I think LER should have claimed such disbursements, if at all, when the parties and court addressed Mr Syson’s motion to have the noting in default and default judgment set aside, permitting him to file a defence.

c. For similar reasons, I do not think Mr Syson should properly be claiming disbursements associated with the filing of his motions; motions which apparently already have been addressed by the court without any such legal costs being awarded.

d. In my view, Mr Syson’s indicated disbursements relating to photocopying seem excessive and questionable, at least without further supporting information. In particular, the indicated disbursement of $5,630.75 in that regard, which is said to have been calculated at the rate of 25 cents per page, indirectly suggests the making of no less than 22,523 photocopies. Nothing near that volume of documentation was filed at trial. Even when reasonable allowances are made for copying of documents related to overall trial preparation, (e.g., research of legal issues relating to LER’s claim and/or Mr Syson’s counterclaim, satisfaction of undertakings, duplication of material for review by the expert Mr Syson retained, etc.), the volume of photocopying still seems excessive, strongly suggesting that much of that copying also relates to interlocutory motions in respect of which reimbursement should not be sought at this stage of the proceedings.

REASONABLE EXPECTATIONS OF UNSUCCESSFUL PARTY – RULE 57.01(1)(0.b)

[27] Rule 57.01(0.b) permits the court to consider, in exercising its cost discretion, “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”.

[28] In the present context, I am being asked to determine, fix and award the costs of the entire action; i.e., essentially all steps taken in the action, (the “proceeding” in this case), from retention of counsel to trial completion, which are not attributable to interlocutory steps in the proceeding in respect of which costs explicitly or implicitly already have been addressed.

[29] This particular case does not involve a situation where any arguably unsuccessful party has declined to provide the court with information concerning its or his own costs, in turn permitting a simple inference that the resources devoted to the matter by the unsuccessful party were comparable to those expended by the successful party.[^11]

[30] To the contrary, as noted above, both LER and Mr Syson provided me with a Bill of Costs, setting out the legal costs each was said to have incurred in litigating LER’s claim and Mr Syson’s counterclaim. Repeating some of that above information here simply for ease of reference, and once again using figures prior to addition of applicable HST:

a. LER indicated that its legal representatives devoted $39,714.00 worth of time to the matter on a partial indemnity basis, and that it incurred $3,571.29 in claimable disbursements; and

b. Mr Syson indicated that his legal representatives devoted $52,163.15 worth of time to the matter on a partial indemnity basis, and that he incurred $23,160.14 in claimable disbursements.

[31] For the reasons outlined above, I think the figures submitted in that regard effectively require a number of adjustments reducing and/or “backing out” particular components used in the calculation of each party’s costs of the action.

[32] For example, just using the same 60 percent ratio for calculation of partial indemnity fees for both parties, (i.e., instead of the 65 percent ratio used in preparation of Mr Syson’s Bill of Costs), would bring the relative partial indemnity fees incurred by each party to $39,714.00 for LER and $48,150.60 for Mr Syson.

[33] In broad strokes, such figures suggest to me that neither party, if unsuccessful, would have been particular shocked by the legal fees incurred by the other party in addressing the same claim and counterclaim, or corresponding claims for cost reimbursement. In other words, I do not think such cost claims would have strayed much beyond each party’s expectations of the amount of costs that party might be required to pay, in relation to legal fees, if that party was unsuccessful.

[34] At first glance, a similar inference might seem harder to draw in relation to disbursements. In particular, the $19,588.85 disparity between the disbursements incurred by LER and Mr Syson is much greater than the disparity between the partial indemnity legal fees incurred by each party. However:

a. I think a large component of that disparity might reasonably have been expected by LER, given the reality that Mr Syson effectively was compelled to retain an expert whereas LER was not; and

b. in relation to the large disbursement incurred by Mr Syson in relation to photocopies, (which also features prominently in explaining the disparity in disbursements incurred by each party), LER might reasonably have expected Mr Syson to incur higher costs in that regard if his lawyers effectively shouldered the burden for making copies of such items as contemplated agreed exhibits, (including extensive photographs), used and relied upon by both parties at trial.

[35] More generally, the reality of LER not questioning the legal expense devoted to the matter by Mr Syson, and Mr Syson raising only a few criticisms of the legal expense devoted to the matter by LER, reinforces my impression that the costs likely to have been claimed by each party, in the event of success, probably fell within the broad subjective expectations of the other.

[36] However, an assessment of what may or may not have been “reasonable” cost expectations of a litigant is not based on subjective considerations alone. To the contrary, such determinations also require an assessment of whether a party’s cost expectations were/are reasonable from an objective standpoint. In that regard:

a. The need for all involved in our justice system to focus on cost control and proportionality is emphasized generally by our Rules of Civil Procedure. For example, that emphasis is reflected in:

i. Rule 1.04(1), the provisions of which include a direction to construe the rules, (and therefore Rule 57.01 as well), in a manner that will promote securing “the least expensive” determination of a civil proceeding on its merits; and

ii. Rule 1.04(1.1), which obliges the court to apply the rules and make orders, (including those relating to cost awards), in a manner “proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding”.

b. Various authorities also have noted the relationship between the reasonable cost expectations of litigants and the principles of proportionality. In particular, although the “reasonable expectation” principle requires a judge determining costs to examine the particular facts of the case and the subjective expectations of the parties, the principle of proportionality also engages a more objective analysis, having regard to the issues and amounts in dispute.[^12]

c. It also has been held that s.86(2) of the Construction Lien Act, supra, requiring courts to award only costs of the “least expensive course of action that could have been taken” in relation to matters governed by that legislation, represents an express statutory limitation on the court’s discretion to award costs that is akin to the factor of proportionality. Such an approach makes sense, as the least expensive course of action also would be the course appropriate to the importance and complexity of the issues and the amount involved in the case, which is the definition of proportionality in Rule 1.04.[^13]

[37] For such reasons, considerations of proportionality play a significant role in determining whether party cost expectations may or may not have been “reasonable”, as well as the “overriding principle of reasonableness” described above.

[38] I nevertheless think it fair to say that the caselaw also suggests tension, between competing considerations, when it comes to determining the extent to which proportionality should be applied as a factor limiting cost recovery.

[39] On the one hand, many decisions emphasize the fundamental importance of proportionality, (e.g., as a means of discouraging excessively litigious behaviour, limiting the spiraling costs of litigation, and thereby ensuring access to justice), and take a critical or dim view of cost requests that either represent a sizeable fraction of amounts actually recovered through litigation, or actually exceed the trier of fact’s objective assessment of what a case really was worth. To cite but a few examples in that regard:

a. A plaintiff’s request for a cost award approximately 2.5 times the amount recovered by the plaintiff was characterized as “extremely excessive” and “outlandish”.[^14]

b. In a case where a plaintiff succeeded in proving that a defendant was liable and required to pay $14,139.60 in liquidated damages, the court described the plaintiff’s claim for $8,977.55 as “excessive”. In particular, noting that the costs awarded to the plaintiff on a partial indemnity scale “should also bear some reasonable proportionality to the amount of money awarded to the plaintiff as damages”, the court fixed the plaintiff’s cost in the all-inclusive amount of $5,000.[^15]

c. Where an appellant claimed partial indemnity trial costs of $172,645.55, and a respondent claimed full indemnity trial costs of $160,706.99, all in relation to a dispute about a claim for approximately $80,000, our Court of Appeal lamented that a “comparison of what [the] dispute was about and what was spent on it [was] stark and difficult to justify”. Emphasizing that the “the principle of proportionality, which is fundamental to any sound costs award, [cried] out for application”, the Court of Appeal awarded the respondent trial costs of $60,000 plus disbursements.[^16]

d. Where a successful plaintiff in a construction lien action was wholly successful in establishing its claim for $49,271.84, (after a trial taking place over the course of nine days and two trial sittings), and sought a total of $134,814.32 in costs and disbursements on a partial indemnity basis, the court accepted that proportionality should not be used to deprive a successful litigant of its costs simply because a claim was small, but also emphasized that “the principle of proportionality cannot give way to allowing costs that are excessive or unreasonable in light of the amounts involved and the results achieved at trial.” In the result, the court awarded the all-inclusive sum of $50,000 for fees, and the all-inclusive sum of $10,000 for disbursements.

[40] On the other hand, other decisions have expressed the view that cost recovery should not always be limited by considerations of proportionality, especially in cases where establishing even a modest claim reasonably required a certain amount of legal expense, and/or where a successful party arguably was forced, by the unreasonable behaviour of an unsuccessful opponent, to engage in litigation not commensurate with the underlying value of a claim or defence. For example, first instance cost decisions in this court have opined:

a. that “the principle of proportionality should not normally result in reduced costs where the unsuccessful party has forced a long and expensive trial”, as it would be “cold comfort to the successful party, who has been forced to expend many thousands of dollars and many days and hours fighting a claim that is ultimately defeated, only to be told that it should obtain a reduced amount of costs based on some notional concept of proportionality”;[^17]

b. that “proportionality cannot and should not be routinely invoked to save litigants from the actual costs of proceedings in circumstances where those litigants have put forth a wholly unmeritorious defence to a legitimate claim or have caused the proceeding to become unduly prolonged or complicated”;[^18]

c. that “the principle of proportionality should not be used to deprive a successful litigant of its costs simply because the claim is small”, as such “overapplying” (sic) of the principle “will tend to encourage litigants who are resisting legitimate but modest claims to act unreasonably, either in their positions or in the conduct of the litigation”;[^19] and

d. that “proportionality does not override other considerations when determining costs”, and “should not be used as a sword to undercompensate a litigant for costs legitimately incurred”.[^20]

[41] Moreover, our Court of Appeal has confirmed that, while “the principle of proportionality is an overarching consideration in determining the appropriate quantum of costs”, it also “requires a decision-maker to consider whether the costs incurred were justified in light of the circumstances of the case”, and “the fact that a costs award exceeds a damages award does not necessarily mean that appellate intervention is warranted”, as the ultimate question “is whether the costs award, in all the circumstances, is fair and reasonable”.[^21]

[42] The various authorities noted above essentially confirm that, like many other considerations to be weighed in exercising the court’s broad discretion regarding costs, there are no absolute rules when it comes to proportionality.

[43] In particular, while the proportionality principle is certainly important, it is not always the subject of rigid and formulaic application. It instead needs to be applied thoughtfully and in a balanced fashion, along with other factors such as those enumerated in Rule 57.01 of the Rules of Civil Procedure.[^22]

[44] Turning to the specifics of the case before me:

a. LER incurred actual legal costs of $78,612.34, (or costs of $47,167.40 on a partial indemnity basis), to establish an entitlement to $10,000 in damages owed to LER by Mr Syson, while defending Mr Syson’s counterclaim.

b. Mr Syson incurred actual legal costs of $116,788.68, (or costs of $85,049.41), to establish an entitlement to $4,000 in damages owed to Mr Syson by LER, while defending LER’s claim.

c. Both parties accordingly spent a total of $195,401.02 in actual legal costs, (or $132,216.81 in partial indemnity costs), to establish that, after the application of an appropriate set-off, Mr Syson owed LER the grand sum of $6,000. To do that, the parties also consumed 11 days of relatively scarce and therefore precious trial time in the Superior Court of Justice.

d. Having regard to those broad realities, it is hard not to view this litigation as a debacle, at least from the standpoint of proportionality.

[45] LER submits that Mr Syson essentially is to blame in that regard; i.e., alleging that its claim for payment on the contract was relatively straightforward, and that the length and complexity of the trial stemmed primarily from the need to address the many roof deficiencies and failings alleged by Mr Syson, including what LER characterized as “trivial grounds of argument”.

[46] In my view, there is a degree of truth to such assertions.

[47] In his quest to establish that the metal roof installed by LER was so very deficient that he not only owed nothing further to LER pursuant to the parties’ agreement, but that nothing short of complete removal and replacement of the metal roof and further items would do to address and remedy the situation, Mr Syson generally was not prepared to concede that any aspect of the product supplied by LER and/or work done by LER was satisfactory. As noted in my judgment, Mr Syson also was intent on pursuing reimbursement of a $672.35 charge levied against him by his bank, even though the costs of addressing and resolving that particular aspect of the parties’ dispute, (including the portion of actual legal fees Mr Syson likely would never recover in any event barring an extremely rare order directing full cost indemnity), inevitably would dwarf the modest amount in dispute.

[48] Moreover, I also accept that the wide array of issues raised in this litigation could not be addressed without a minimum of legal expense; a minimum inherently and unavoidably disproportionate to the actual value of the underlying dispute, according to the objectively determined outcome.

[49] However, I also think LER’s assertions ignore the countervailing reality that, up to and during the trial, LER’s formal position in relation to Mr Syson’s complaints, (a position articulated repeatedly by Mr Malec), was equally absolute, intransigent and unbending. In advance of trial, at least, LER refused to backdown and formally acknowledge that there were any remaining deficiencies in the metal roof it installed, that any aspects of LER’s completed workmanship may have been inadequate or deficient, and/or that Mr Malec and LER may have made an error in the monetary amount claimed in the invoice relied upon by LER, or the amount of its corresponding registered lien.

[50] In the result, the length and complexity of the proceeding stemmed from both parties failing to make concessions in the formal litigation – apart from the largely incontrovertible matters summarized in the helpful but relatively limited agreed statement of facts filed by the parties.[^23]

[51] Furthermore, it is not as if LER’s claim for payment stood in splendid isolation from Mr Syson’s counterclaim for damages, in terms of complexity. Whether or not Mr Syson would owe money to LER or vice-versa, and how much money would be owed, turned on resolution of the same underlying issues relating to possible deficiencies in the metal roof and its installation – and, (as discussed in greater detail below), success in that regard was somewhat divided.

[52] In relation to s.86(2) of the Construction Lien Act, supra, requiring the court to consider if either party or both parties have failed to take the “least expensive course of action that could have been taken”, in relation to this construction lien dispute:

a. Those with even a passing familiarity with the $25,000 monetary jurisdiction of Ontario’s Small Claims Court might wonder why a dispute, essentially focused on monetary issues, and objectively found to involve a claim worth $10,000 and a counterclaim worth $4,000, was not litigated in the Small Claims Court, with its expedited and streamlined procedures; i.e., instead of taking up 11 days of trial time in the Superior Court of Justice.

b. As noted and emphasized by LER, at least part of the explanation, (if not the answer), is found in the provisions of the Construction Lien Act, supra, as it stood on June 28, 2018. In particular:

i. subsection 50(1) of that legislation provided that a lien claim governed by the legislation was “enforceable in an action in the Superior Court of Justice”;

ii. subsection 53(1) of that legislation required such an action to be commenced by issuing a statement of claim in the registrar’s office of the Superior Court of Justice in the area where the relevant premises or a part thereof, forming the subject of the lien, were situated; and

iii. section 51 of that legislation then generally required the court to try the action, “including any set-off [and] counterclaim”, as well as “all questions that arise therein or that are necessary to be tried in order to dispose completely of the action and to adjust the rights and liabilities of the persons appearing before it or upon whom notice of trial has been served”, and to “take all accounts, make all inquiries, give all directions and do all things necessary to dispose finally of the action and all matters, questions and accounts arising therein or at the trial, and to adjust the rights and liabilities of, and give all necessary relief to, all parties to the action”.

c. Once LER decided to exercise the lien rights granted to it by the Construction Lien Act, supra, both its claim and Mr Syson’s counterclaim accordingly had to be brought in the Superior Court of Justice, regardless of how modest the true monetary value of the claim and counterclaim may have been.

d. As noted in the responding cost submissions delivered on behalf of Mr Syson, while LER was entitled to exercise its legislated right to register, perfect and enforce a construction lien, thereby committing its resulting claim and any counterclaim of Mr Syson to the Superior Court of Justice, it was not obliged to do so. It could have waived its entitlement to a construction lien and approached the matter as a simple monetary claim, for breach of contract, in the Small Claims Court.[^24] In doing so, LER may not have had the formal security of a lien, but it had the benefit of a title search confirming that there was a great deal of unencumbered equity in the relevant property, (i.e., Mr Syson’s home), and future access to all legislated mechanisms to address any fraudulent conveyance or preference that might have been created after Mr Syson received notice of its formal claim. Having said that:

i. I am mindful that the Legislature created construction lien entitlements for a reason. In particular, the monetary claims of those providing goods and services related to property improvements otherwise have no priority in relation to other bona fide creditors of a property owner without the benefit of a lien, nor any corresponding leverage helping to ensure that their claims of whatever size are addressed in a serious and prompt manner. In my view, it is not the role of this court to question or undermine those legislated objectives by suggesting that a party entitled to the benefits of a construction lien, through a right conferred by the Legislature, should be penalized in costs for exercising that right.[^25]

ii. I also am mindful that, even if LER had initiated the litigation by a simple monetary claim in the Small Claims Court, the matter realistically would not have remained in that court for long if Mr Syson was intent on bringing and pursuing a counterclaim that nominally was well in excess of the monetary jurisdiction of the Small Claims Court.

e. However, although circumstances realistically may have required LER’s claim and Mr Syson’s counterclaim to be initiated in this court, it seems to me that both parties thereafter failed to explore, propose and pursue alternatives to litigating their dispute to a conclusion by way of an extended trial taking place entirely before a Superior Court Judge, using the ordinary procedures of this court. In that regard:

i. I am not persuaded by the cost submissions, delivered on behalf of Mr Syson, suggesting that LER should be faulted for this litigation not proceeding in accordance with the simplified procedure outlined in Rule 76 of the Rules of Civil Procedure. In particular, I note that, at all material times, Rule 76.01(b) made the simplified procedure inapplicable to actions under the Construction Lien Act, supra, except in relation to trust claims.[^26] The Rule 76 simplified procedure per se accordingly could not have been applied to this matter while LER exercised its legislated right to a construction lien and, for the reasons noted above, I do not think LER should be penalized from a cost perspective simply because it exercised that legislated right.

ii. However, while the combined effect of LER exercising its right to a construction lien and Rule 76.01(b) rendered the simplified procedure in Rule 76 per se inapplicable to this proceeding, in my view that should not have ended efforts by both parties to propose and pursue simplified procedural measures that would have helped all concerned avoid the disproportionate costs devoted to LER’s claim and Mr Syson’s counterclaim, having regard to the modest value of the dispute. To the contrary, pursuant to 67(1) of the Construction Lien Act, supra, as it read on June 28, 2018, the procedure in this action was to be “as far as possible of a summary character, having regard to the amount and nature of the liens in question”, and 67(2) of the same legislation reinforced the point by providing that interlocutory steps, other than those provided for in the Act, were not to be taken without the consent of the court, obtained on proof that the steps were necessary or would expedite the resolution of the issues in dispute. In the circumstances, either party could and should have taken proactive measures to simplify this litigation and minimize the associated costs, either by agreement or by seeking appropriate binding directions from the court; e.g., allowing the dispute to be addressed in a manner resembling some if not all aspects of the Rule 76 simplified procedure, even if the Rule itself formally had no application to the litigation. There was nothing before me to suggest that either party made any suggestions or pursued any initiatives in that regard.

iii. Moreover, while formally consigning all construction lien litigation to the Superior Court of Justice, the Legislature also clearly seems to have recognized that such a wide net might very well catch disputes more appropriately addressed by methods less complicated and expensive than having such disputes tried in their entirety by a Superior Court Judge, pursuant to the court’s ordinary procedures. Even before recent amendments to the Construction Lien Act, supra, the legislation obviously contemplated and permitted such disputes to be tried “on a reference” by “a master, a case management master or a person agreed upon by the parties”.[^27] Such relief nevertheless was capable of being granted only “on motion made after the delivery of all statements of defence, or the statement of defence to all crossclaims, counterclaims or third party claims”. In other words, one or both parties had to request such relief; the court was not granted authority to unilaterally initiate such measures.[^28] In this case, I was provided with nothing to indicate that either party ever considered or suggested asking the court to direct such a reference.

[53] For such reasons, I am not persuaded, for the purposes of s.86(2) of the Construction Lien Act, supra, that either party to this litigation made appropriate efforts to take the “least expensive course of action that could have been taken”, in relation to litigation of the parties’ dispute.

[54] In my view, awarding costs without serious regard to such realities, in relation to construction lien disputes of relatively modest value, is hardly conducive to encouraging such efforts.

AMOUNT CLAIMED AND RECOVERED – RULE 57.01(1)(a)

[55] Rule 57.01(1)(a) permits the court to consider “the amount claimed and the amount recovered in the proceeding”.

[56] As stated, the wording of that factor nominally focuses on financial amounts claimed and recovered.

[57] However, the broader underlying consideration is the degree to which a party to a proceeding, or step in a proceeding, may or may not have been successful in obtaining requested relief. In that regard:

a. In the context of civil litigation, a party who succeeds in obtaining recovery generally is entitled to his or her partial indemnity costs, subject to the discretion of the trial judge under section 131 of the Courts of Justice Act, supra, having regard to the factors outlined in Rule 57 and related jurisprudence.[^29]

b. Although cost awards in construction lien actions are governed by slightly modified and supplemented principles, (noted above), the general rule of costs usually being awarded to a successful party also applies to construction lien claims.[^30]

c. However, success is not a guarantee of cost recovery. For example, included within Rule 57.01 are provisions expressly confirming, inter alia, that:

i. a party’s success in a proceeding or step in a proceeding does not prevent the court from awarding costs against the party in a proper case;[^31] and

ii. nothing in Rule 57.01, (or Rules 57.02 to 57.07 for that matter), limits the authority of the court under section 131 of the Courts of Justice Act to award or refuse costs in respect of a particular issue or part of a proceeding.[^32]

d. Moreover, where litigated outcomes actually reflect only partial or divided success, (including partial or divided success in litigation governed by the Construction Lien Act, supra), courts often limit or deny cost recovery.[^33]

[58] Turning to the specifics of this particular case, I think it fair to say that determination of success, or relative success, is not a straightforward exercise.

[59] Focusing simply on the extent to which the parties were able to substantiate their respective positions and obtain relief they were requesting:

a. LER claimed that Mr Syson had unfulfilled contractual obligations to pay LER a further $15,000. Leaving aside the implications of Mr Syson’s counterclaim and request for set-off, LER was able to establish that Mr Syson still owed LER $10,000. In other words, LER succeeded in establishing two-thirds or approximately 66 percent of its claim. Conversely, Mr Syson was successful in defending one-third of LER’s claim.

b. Mr Syson claimed that nothing short of removing and replacing the metal roof installed on his home, together with further required work and material not contemplated by the original roofing contract with LER, (e.g., replacement of his attic insulation and eavestroughs), would suffice to remedy the situation. Because of the current COVID-19 pandemic, I am unable to access the court file and confirm the precise amount of damages sought by Mr Syson in that regard; claims which were buttressed by the estimates/quotes he had obtained from contractors willing to undertake the remedial work being suggested.[^34] However, my memory, (consistent with indications contained within LER’s written cost submissions), is that the damages formally being sought by Mr Syson in his counterclaim were at least three times the amount of the original roofing contract price of $20,000. In any event, Mr Syson succeeded in establishing a total of only $4,000 in damages pursuant to his counterclaim, and therefore only a relatively small fraction, (approximately six percent or less), of the monetary relief he was seeking in his counterclaim. Conversely, LER was successful in defending a correspondingly large portion, (approximately 94 percent or more), of Mr Syson’s counterclaim.

[60] However, focusing on the degree to which LER was the successful party in terms of obtaining a judgment permitting the recovery of damages, and recognizing that Mr Syson’s counterclaim also had the character of a set-off defence to LER’s claim, LER succeeded in recovering only $6,000 of the amounts it was seeking. In other words, the successful party in this case, (if success is defined only in terms of which party was able to obtain a positive monetary judgment in its favour), succeeded in recovering only 40 percent of the damages it was seeking. In that sense, Mr Syson succeeded in defending 60 percent of LER’s claim.

[61] Looking at the matter from yet another perspective, one might also have regard to the degree to which each party enjoyed success in relation to specific underlying issues raised by the litigation, which cumulatively factored into producing the final outcome reflected in the court’s judgment. In that regard:

a. I am very mindful of authorities noting that our courts generally frown on application of a “distributive costs” principle, focusing on the extent to which parties may have succeeded in establishing or refuting certain arguments in relation to underlying issues addressed by the court in arriving at a final judgment.[^35] Generally, it is the overall outcome of litigation that defines success, and not the manner in which the court approached and decided incidental arguments and steps in the court’s reasoning that led to the overall litigated outcome. For example, a defendant who asserts four arguments, three of which are rejected, but the fourth of which is sufficient to defeat 100 percent of a plaintiff'’s claim, is usually regarded as an entirely successful party. In such a case, it would pervert the notion of “success” for a court to conclude that a plaintiff obtaining none of the recovery he or she sought was the more successful party simply because he or she succeeded in relation to three of the four arguments raised in the litigation. Conversely, a plaintiff who recovers 100 percent of the relief he or she was seeking, based on one sufficiently meritorious argument, is usually regarded as the entirely successful party even though a defendant may have been able to persuade the court that most of the plaintiff’s arguments lacked merit.

b. However, it seems to me that cost determinations taking into account success or failure in relation to incidental issues arguably move away from application of a “distributive costs” principle per se in situations, such as the one before me, involving:

i. issues that are raised not only by way of defence but by way of counterclaims accompanied by formal requests for the application of set-off; and

ii. parties, on consent, expressly and overtly approaching a trial by formally asking the court to give separate and discrete rulings, in relation to a number of specifically identified incidental issues, on the understanding that the cumulative effect of those discrete rulings will be factored into an appropriate final judgment.

c. Having said that, in my view determination of relative success in this case is not a straightforward exercise even if one approaches the matter by focusing on the extent to which each party may have prevailed in relation to the numerous specifically identified issues the court was asked to address and resolve. Without limiting the generality of the foregoing:

i. As noted above, the parties essentially asked me to address and resolve no less than 32 specific issues en route to making an overall determination of what sums, if any, were owed to each party by the other.

ii. However, I think assessing each party’s degree of success by relying on a simple tally of which party prevailed in relation to each of those 32 issues would be misleading to some extent; e.g., because some of the issues were duplicative, (for the reasons outlined in my judgment), and success in relation to some of those individual specified issues also was not absolute but somewhat divided.

iii. Moreover, I think it important to note that success in relation to the specified individual issues was obviously not just quantitative but qualitative, and such realities also would not be reflected in a simple numerical tally of the specific issues in respect of which each party may have enjoyed success or failure, even if the relevant “wins” or “losses” were absolute. In particular:

1. Victory in relation to some of the specified issues was far more important than victory in relation to others, in terms of the financial implications of each determination. For example, Mr Syson’s success in establishing that he was entitled to reimbursement for a broken ornamental statue purchased for $300.00 had much less impact on the final judgment than Mr Syson’s failure to establish that there were ventilation problems requiring removal and replacement of the metal roof installed by LER and all of Mr Syson’s attic insulation.

2. Many of the specifically identified issues to be addressed by the court obviously were more complex, and/or required much more time and expense to address and resolve, than others. For example, determining whether or not LER failed to remove excess sheet metal from Mr Syson’s property after completing its work essentially occupied less than 30 minutes of time at trial, having regard to Mr Friesen’s acknowledgment that such material was left behind at the work site, and Mr Syson’s unchallenged testimony that he was required to remove them. On the other hand, determining whether or not the parties had entered into a binding supplemental oral agreement, (whereby Mr Syson was required to pay a further $5,000, beyond the price agreed in the parties’ written contract, in relation to work done on the “whiskers” of his residence), occupied a considerable degree of time at trial; e.g., requiring a repeated and sustained focus on documents, interactions between Mr Malec and Mr Syson that may or may not have taken place and/or have been witnessed by others, and fundamental credibility assessments in relation to that issue.

[62] For all these reasons, I think an exact determination of each party’s degree of success would be difficult and perhaps misleading, insofar as it would suggest the possibility of precision in that regard.

[63] On balance, however, having regard to the above considerations and alternative perspectives or metrics of success, I think it fair to say that:

a. success in the litigation was divided;

b. LER nevertheless was the party which succeeded in recovering damages by way of a judgment in its favour, and it was significantly more successful than Mr Syson in relative terms;

c. LER accordingly should be entitled to a measure of costs; and

d. that measure of costs nevertheless should be tempered by LER’s lack of success in relation to all aspects the issues the court was specifically asked to address and resolve, (including those raised by Mr Syson’s counterclaim), as well as the other considerations addressed in this endorsement.

COMPLEXITY OF PROCEEDING – RULE 57.01(1)(c)

[64] Rules 57.01(1)(c) permits the court to consider, in exercising its cost discretion, “the complexity of the proceeding”.

[65] In my view, the litigation involved issues of above-average complexity in terms of the underlying factual matrix, having regard to such matters as the number of specific issues the parties asked the court to address and resolve, the extended and varied interactions between the parties, and the associated complexities of metal roof design, installation and operation.

[66] While many of the issues turned on factual determinations, some also raised legal issues of moderate complexity; e.g., in terms of interpreting and applying legislation and principles governing building projects, roof installation and construction lien disputes, as well as the implications of party banking arrangements and/or extending the ambit of construction lien claims to parties holding other secured interests in a property that was the subject of improvements.

[67] Such complexities were reflected in the length of my judgment.

[68] In this particular case, trial of the matter also was complicated and prolonged, to some extent, by the need for Polish-English interpreters in relation to Mr Syson’s testimony.

IMPORTANCE OF ISSUES – RULE 57.01(1)(d)

[69] Rule 57.01(1)(d) permits the court to consider, in exercising its cost discretion, “the importance of the issues” addressed by the proceeding.

[70] In this case, I agree with defence counsel’s submission that this litigation raised issues of great importance to Mr Syson. The dispute focused on his personal residence, and determinations as to whether the metal roof installed to protect that residence required repair or replacement. I also think it fair to infer, (e.g., from the efforts Mr Syson made to obtain the lowest price possible from LER), that the metal roof installed by LER essentially represented a significant financial investment from Mr Syson’s perspective.

[71] I nevertheless have great difficulty with defence counsel’s submission that this litigation was or should be viewed as “just another contract dispute” and “yet another claim of negligence and poor workmanship” from LER’s perspective; e.g., on the suggested basis that “LER is no stranger to civil litigation and actions arising from its business operations”. Without limiting the generality of the foregoing:

a. In my view, the submission was one that might fairly be characterized as a “drive by smear”, insofar as I have nothing whatsoever before me to suggest that LER has been involved or is involved in other litigious disputes, (let alone disputes where complaints against LER had or have established merit), and in my view the current context is not one in which LER properly could have responded, or needed to respond, to vague allegations of negligence and/or poor workmanship in other unspecified contexts.

b. While the analogy is not precise, in my view such allegations are akin to attempts to present irrelevant and prejudicial evidence of bad character, based on matters having no established connection with an immediate dispute before the court. This court does not reach decisions based on the supposed general reputation of parties. It does so based on the merits of the particular dispute before it, and in this case, LER was the more successful party for the reasons in my judgment and in this endorsement.

c. I reject defence counsel’s implicit premise that a dispute like this would not be as important to LER as it was to Mr Syson. In my view, the evidence at trial made it clear that LER depends heavily on its reputation for supplying a quality product, installed through quality workmanship. While Mr Syson may represent only one of LER’s many customers, and the monetary value of LER’s claim and Mr Syson’s counterclaim may have been relatively modest in relation to LER’s total volume of business, Mr Syson’s counterclaim included overt attacks on fundamental aspects of LER’s metal roof design, as well as its installation practices. Commitment to the “open courts” principle, (reflected in sections 135 to 137 of the Courts of Justice Acts, supra), meant that objective judicial findings in this particular dispute and its outcome, as well as all documents filed in relation to the dispute, would be the subject of public access and possible if not probable recirculation, with potentially devasting implications for LER’s business reputation and future sales, let alone possible implications in terms of further litigation between LER and other customers. For such reasons, I do not think LER’s desire and need to defend its product and workmanship in this particular litigation should be treated likely.

[72] In short, I think the issues raised by this litigation were of great importance to both parties, even if they may have lacked wider significance to members of the public not having any dealings with LER.

CONDUCT AND/OR STEPS THAT LENGTHENED THE PROCEEDING OR WERE UNNECESSARY, AND REFUSALS TO MAKE APPROPRIATE ADMISSIONS – RULES 57.01(1)(e), (f) and (g)

[73] Rule 57.01(1)(e) permits the court to consider, in exercising its cost discretion, “the conduct of any party that tended to shorten or lengthen unnecessarily the duration of the proceeding”.

[74] Rule 57.01(1)(f) permits the court to consider whether any step in the proceeding was “improper, vexatious or unnecessary”, or “taken through negligence, mistake or excessive caution”.

[75] Rule 57.01(1)(g) permits the court to consider, in exercising its cost discretion, the refusal of a party to make appropriate admissions.

[76] All three considerations address, in varying ways, the possibility of unreasonable behaviour that may have led to excessive litigation and legal expense that could have been avoided.

[77] In this case, each party offered competing criticism of the other in that regard.

[78] Some of those criticisms already have been addressed in these reasons. In particular:

a. LER argued that Mr Syson’s conduct unnecessarily lengthened the duration of the proceedings by allowing himself to be noted in default, (in turn leading to abortive steps by LER to obtain and enforce a default judgment), and by moving shortly before trial to amend his pleading. Alternatively, it was suggested that such conduct on the part of Mr Syson resulted in the taking of steps that were or should have been unnecessary.

b. Mr Syson argued that LER unnecessarily extended the duration of the proceedings, and forced the parties to incur unnecessary steps and expense, by choosing to exercise its right to a construction lien instead of pursuing a contractual claim in the Small Claims Court or using the Rule 76 simplified procedure available in the Superior Court of Justice.

[79] I already have explained why I do not think such considerations should have any impact on the cost determination I currently am required to make.

[80] Beyond such concerns, each party faulted the other for taking and maintaining certain positions that were found, after trial, to be lacking in merit. For example:

a. LER argued that Mr Syson unnecessarily lengthened the proceeding by alleging numerous failings and deficiencies that were found to be trivial or non-existent, but only after LER was put to considerable expense addressing and refuting them. The implicit if not express suggestion is that Mr Syson should have admitted that there were no such deficiencies, or significant deficiencies, from the outset of the parties’ dispute or at least well before trial.

b. For his part, Mr Syson argued that LER unnecessarily lengthened the proceeding by refusing to admit it had erred in claiming that Mr Syson owed an additional $5,000 beyond the original $20,000 contract price, by refusing to admit that the construction lien LER registered accordingly was overstated, and/or by refusing to admit that there were certain deficiencies and failings in LER’s metal roof and workmanship; e.g., the functional and cosmetic deficiencies identified in my judgment, the breaking of Mr Syson’s ornamental statute, and LER’s failure to clean up its work site.

[81] It seems to me that such arguments essentially focus on the extent to which each party was or was not successful; a consideration which also has addressed earlier in these reasons.

[82] There nevertheless is a particular dimension of such refused admissions that I think deserving of further comment, relating to LER’s failure to admit/acknowledge that there was no binding oral agreement requiring Mr Syson to pay an additional $5,000, (in relation to the work done on the “whiskers” of his residence), and LER’s failure to admit/acknowledge that the construction lien registered by LER accordingly was overstated by that $5,000 amount. In particular:

a. In my view, many aspects of the dispute between the parties focused on figurative “grey” areas of diverging opinion, matters of degree and arguably legitimate debate, (e.g., as to whether certain aspects of the installed roof were functionally problematic, whether certain aspects of the completed roof contained significant cosmetic deficiencies, whether or not LER’s installers had broken Mr Syson’s ornamental statute, and whether or not LER had any obligation to take further actions – such as removal of excess sheet metal from Mr Syson’s property - in the wake of Mr Syson’s refusal to make further payment), that required resolution by an objective decision maker.

b. However, I frankly find it very difficult to view LER’s position in relation to the alleged supplementary oral agreement with Mr Syson, and LER’s corresponding position concerning the monetary amount of its registered lien, in the same fashion. In particular, for the detailed reasons set forth in my judgment, I found that the sensible and likely conclusion, in relation to those matters, was:

i. that LER initially filed a lien for $15,000 based on the price of $20,000 agreed upon in the parties’ original written contract, less the initial $5,000 down payment received from Mr Syson, without taking into account the further $5,000 payment Mr Syson had made;

ii. that Mr Malec and LER then were reminded of the additional $5,000 payment made by Mr Syson when the handwritten receipt on Mr Malec’s business card, (supplied by Mr Malec to Mr Syson, and confirming LER’s receipt of a cumulative $10,000 from Mr Syson), was produced to Mr Malec during the course of this litigation; and

iii. that Mr Malec, (and therefore LER), then relied on the alleged existence of a further oral agreement with Mr Syson as a belated justification for LER’s original assertion that Mr Syson still owed LER a further $15,000 in relation to the work done on Mr Syson’s roof.

c. In other words, while Mr Malec and/or LER initially may have made an inadvertent and honest accounting error in specifying the remaining monetary payment owed by Mr Syson, there came a point when the errors in LER’s relevant invoice and lien amount should have been admitted and acknowledged. Mr Malec instead attempted to “backfill” and support LER’s position in the litigation by asserting the existence of a further oral agreement that would explain and justify the discrepancy. In my view, (and for the reasons set out in detail in my judgment), Mr Malec did so in circumstances when he knew or reasonably ought to have known that there was no such oral agreement, and Mr Malec’s knowledge in that regard must be attributed to LER.

d. I frankly found that aspect of the litigation to be troubling. At the very least, I think LER, by continuing to assert that the proper value of its construction lien was $15,000 and not $10,000, (at the direction of Mr Malec), effectively condoned a situation where its registered construction lien, (which LER persisted in trying to enforce), was for a wilfully exaggerated amount.

e. As noted above, the provisions of s.86(1)(b)(i) of the Construction Act, supra, now expressly refer to the possibility of cost consequences when a person who represents a party to a construction lien action knowingly participates in preservation of a lien where it is clear that the claim for a lien is for a willfully exaggerated amount. In my view, while the amended provisions express and highlight that possible consideration, that does not negate the possibility of a court taking such realities into consideration when exercising the broad cost discretion conferred by section 86 of the Construction Lien Act, supra.

f. Such behaviour cannot be condoned, and in my view, a reduction of costs recoverable by LER through the “divided success” principle, (i.e., in part reflecting LER’s failure to establish the alleged supplementary oral contract and that its registered lien properly reflected the balance of sums Mr Syson had agreed to pay), is not adequate to address and convey my concern about Mr Malec and LER defending and pursuing enforcement of a registered construction lien with a wilfully exaggerated amount. In such circumstances, I think a further reduction in the costs LER otherwise might have received is appropriate.

ANY OTHER MATTER RELEVANT TO COSTS – RULE 57.01(1)(i)

[83] In my view, the only “other matter” worthy of comment, in relation to my cost determination, relates to the settlement offers that were delivered during the course of the litigation. In particular:

a. on or about April 26, 2016, LER made a written offer to settle the action on terms whereby Mr Syson would pay LER the all-inclusive sum of $10,000 in full and final satisfaction of all claims and counterclaims, following which the parties would exchange mutual full and final releases and the action would be formally dismissed on a without costs basis; and

b. on or about July 26, 2017, Mr Syson made a written offer to settle the action on terms whereby LER would pay Mr Syson the sum of $33,000 “on account of all claims for damages”, along with prejudgment interest and costs on a partial indemnity scale as agreed or assessed but including all assessable disbursements and applicable taxes.[^36]

[84] Both parties agree that neither settlement offer was sufficient to trigger any presumptive cost consequences pursuant to Rule 49.10, and I independently agree with that assessment. Without limiting the generality of the foregoing:

a. Our courts repeatedly have emphasized that the underlying policy of Rule 49 requires that settlement offers must be clear – indeed, “crystal clear” – before Rule 49.10 and its presumptive cost consequences will be engaged. Uncertainty or lack of clarity in any aspect of an offer may prevent a party from showing that the judgment obtained was “as favourable as the terms of the offer to settle, or more or less favourable”, as the case may be, under Rule 49.10(3).[^37]

b. The “all-inclusive” nature of the settlement offer conveyed by LER in April of 2016 was sufficient to deprive the offer of the clarity required to engage operation of Rule 49.10. In particular, the offer does not make clear the amounts payable for damages and prejudgment interest. That in turn meant that, over time, prejudgment interest would increase, with a corresponding reduction in the amount of damages effectively being paid in accordance with the offer, up until the time of the offer’s acceptance.[^38]

c. The settlement offer conveyed by Mr Syson was not sufficient to engage operation of Rule 49.10, as the litigated outcome obviously did not require LER to pay Mr Syson $33,000 or more in damages.

[85] However, that does not render the settlement offers irrelevant.

[86] To the contrary, in addition to the broad cost discretion conferred on the court by section 131 of the Courts of Justice Act, supra, Rule 49.13 of the Rules of Civil Procedure expressly confirms that, despite a number of identified rules, (including Rule 49.10), the court, in exercising its discretion with respect to costs, “may take into account any offer to settle made in writing, the date the offer was made and the terms of the offer”. [Emphasis added.]

[87] In this case, each party argues that, while its/his settlement offer may not have been sufficient to trigger the presumptive cost consequences of Rule 49.10, its/his offer nevertheless demonstrated the party’s willingness to make reasonable attempts to settle the litigation.

[88] Comparing the settlement offers with the litigated outcome, I think LER obviously has stronger arguments to make in that regard.

[89] However, the fact that neither party made more than one settlement offer, (on a concurrent basis or otherwise), along with the reality that both offers were extended many years after the onset of the parties’ dispute, suggest to me that neither party had a burning interest in meaningful settlement negotiations before the figurative “tail” of disproportionate costs began to wag the figurative “dog” of the parties’ substantive disagreement.

Conclusion

[90] As many decisions have emphasized, discretionary cost determinations are far from an exact science. Indeed, our Court of Appeal has noted that making such determinations actually “is more art than science”.[^39]

[91] I frankly have found the cost determination to be made in this particular case more challenging than others.

[92] Again, the overall goal is to award costs in an amount that is fair and reasonable in relation to a particular proceeding or step in a proceeding, having examined the various considerations outlined in Rule 57.01 and, in this case, s.86 of the Construction Lien Act, supra.

[93] Having regard to all the circumstances of this particular case, including the various considerations explored in detail above, and the overriding principle of reasonableness, I think justice will be served if my discretion is exercised in this case by awarding LER costs of the action, on a partial indemnity basis, fixed in the all-inclusive amount of $18,000, payable by Mr Syson within 90 days of the date on which this cost endorsement is released to the parties.[^40]

[94] The formal judgment in this matter should include a provision to that effect.

Pre-Judgment Interest

[95] In the final paragraph of the initial written cost submissions delivered on behalf of LER, plaintiff counsel included a request for an order confirming that LER was entitled to pre-judgment interest on its judgment of $6,000, from the date the construction lien was registered, in accordance with the provisions of the Courts of Justice Act, supra.

[96] The request was not addressed in the responding cost submissions delivered by defence counsel, and I accordingly have no indication as to whether LER’s request for confirmation of its entitlement to pre-judgment interest is contentious.

[97] On the other hand, I am mindful of the reality that my judgment only invited written submissions relating to costs, and that defence counsel may have confined the focus of her submissions accordingly.

[98] I would like to think that LER’s entitlement to pre-judgment interest in the normal course, in accordance with section 128 of the Courts of Justice Act, supra, would be the subject of relatively straightforward discussion and agreement.

[99] However, if there is some issue that prevents party agreement in that regard, in turn preventing party approval of the form and content of the final judgment to be issued and entered in relation to this litigation, the parties may take the appropriate steps, pursuant to Rule 59.04, to secure an appointment before me to settle the disputed judgment. That appointment may take place by teleconference.

Justice I.F. Leach

Date: May 19, 2020

[^1]: Although this endorsement necessarily reflects and employs the original style of cause in this matter, the plaintiff’s claim against the Toronto-Dominion Bank was formally discontinued many years ago. The defendant bank accordingly did not participate in the trial of this action, nor in the proceedings after judgment to resolve cost issues.

[^2]: As noted in my judgment, (e.g., at paragraphs 4-5 and 20), approximately 28 of those were issues and subsidiary issues expressly set forth in an agreed statement of facts and issues filed by the parties at trial, while at least four more specific issues were raised by the evidence and submissions tendered by the parties.

[^3]: As noted in my judgment, the Construction Lien Act, supra, has been amended and transformed into the Construction Act, R.S.O. 1990, c.C30. However:

a. transitional provisions set forth in s.87.3(1)(a) of the current legislation provide that the Act and regulations made pursuant to the Act, as they read on June 29, 2018, continue to apply with respect to contracts for any property improvements entered into before July 1, 2018; and

b. in this case, there was no dispute that the parties’ written contract, governing the contemplated roofing improvement to the residence of Mr Syson, was entered into on January 16, 2013.

[^4]: The cost provisions found in section 86 of the current legislation are similar to those which were in place on June 29, 2018, but there are differences. In particular, although the wording of s.86(2) remains unchanged in the current legislation, the wording of s.86(1), as it now stands, includes a number of alterations. In particular:

a. the opening provisions of s.86(1) now indicate that “any order as to the costs in an action, application, motion or any other step in a proceeding under [the] Act is in the discretion of the court”, subject to the provisions of s.86(2);

b. the provisions of s.86(1)(b)(i) now refer to a person who represented a party to the action, application or motion, where the person “knowingly participated in the preservation or perfection of a lien, or represented a party at the trial of an action, where it is clear that the claim for a lien is without foundation, is frivolous, vexatious or an abuse of process, or is for a willfully exaggerated amount, or that the lien has expired”; and

c. the concluding provisions of s.86(1) now indicate that such a cost order may be made on a substantial indemnity basis, including where the motion is heard “by a person other than a judge or the action has been referred under section 58” of the current legislation.

[^5]: See Dean Construction Co. v. M.J. Dixon Construction Ltd., 2015 ONSC 1476, 2011 CarswellOnt 8856 (Ont.Master), additional reasons 2011 CarswellOnt 8977, (Ont.Master), additional reasons 2011 CarswellOnt 8862 (Ont.Master); and Luxterior Design Corp. v. Gelfand, [2015] O.J. No. 677 (Master).

[^6]: See, for example, Boucher, Moon and Coldmatic Refrigeration of Canada Ltd. v. Leveltek Processing LLC (2005), 2005 CanLII 1042 (ON CA), 75 O.R. (3d) 638 (C.A.), and Anderson v. St Jude Medical Inc. (2006), 2006 CanLII 85158 (ON SCDC), 264 D.L.R. (4th) 557 (Ont.Div.Ct.).

[^7]: See Boucher v. Public Accountants Council for the Province of Ontario, 2004 CanLII 14579 (ON CA), [2004] O.J. No. 2634 (C.A.), at paragraph 26, and Zesta Engineering Ltd. v. Cloutier, 2002 CanLII 25577 (ON CA), [2002] O.J. no. 4495 (C.A.), at paragraph 4. To my knowledge, there is no reason why such authorities should not apply to construction lien litigation as well, and no authority suggesting that such litigation should be immune from such sensible principles. To the contrary, decisions of this court have expressly emphasized and applied such authorities when making cost determinations in the context of construction lien litigation. See, for example, Northridge v. Sandhu, 2019 ONSC 1348, at paragraph 12.

[^8]: The Bill of Costs prepared and filed on LER’s behalf includes one item relating to work done on a motion by an individual with the initials “TJK”, and another item relating to work done on preparation of an affidavit of documents by an individual with the initials “CAH”. No names, indications of occupation or indications of experience were provided in relation to either individual, although I infer from a comparison with the hourly rates provided for Mr Forrest and Ms Pittam that TJK probably was another lawyer with experience falling between that of Mr Forrest and Ms Pittam, (although closer to that of Mr Forrest), and that CAH probably was a senior paralegal, articling student or very junior lawyer.

[^9]: See, for example, Nobosoft Corporation v. No Borders Inc. (2006), 154 A.C.W.S. (3d) 558 (Ont.S.C.J.), at paragraph 8, reversed on other grounds 2007 ONCA 444, [2007] O.J. No. 2378 (C.A.).

[^10]: See Orkin, The Law of Costs, loose-leaf, (Aurora, Ont.: Canada Law Book Inc., 2001), at 1-15; and Delrina Corp. v. Triolet Systems Inc., 2002 CanLII 45083 (ON CA), [2002] O.J. No. 3729 (C.A.), at paragraph 36; and Sioux Lookout v. The Attorney General et al., 2010 ONSC 3721, at paragraph 24.

[^11]: See, for example: Smith Estate v. Rotstein, 2011 ONCA 491, [2011] O.J. No. 3075 (Ont. C.A.), at paragraphs 50-51, leave to appeal refused, (2012), [2011] S.C.C.A. No. 441 (S.C.C.); and my own comments in Valastro v. London (City), [2013] O.J. No. 1353 (Ont. S.C.J.), at paragraph 12(b).

[^12]: See Culligan Springs Ltd. v. Dunlop Lift Truck (1994) Inc., 2006 CanLII 13419 (ON SCDC), [2006] O.J. No. 1667 (Div.Ct.), at paragraph 33; and Luxterior Design Corp. v. Gelfand, supra, at paragraph 17.

[^13]: See Dean Construction Co. v. M.J. Dixon Construction Ltd., supra; and Luxterior Design Corp. v. Gelfand, supra, at paragraph 16.

[^14]: See Barlow v. The Citadel General Assurance Company, 2008 CanLII 3215 (ON SC), [2008] O.J. No. 335 (S.C.J.), at paragraph 39, leave to appeal cost disposition denied (2009), 2009 ONCA 106, 94 O.R. (3d) 399 (C.A.).

[^15]: See Patene Building Supplies Ltd. v. Niagara Home Builders Inc., 2010 ONSC 468. However, I also note that the court described the trial of that matter as one that was “short and simple”.

[^16]: See Marcus v. Cochrane, 2014 ONCA 207, at paragraph 15.

[^17]: See Cimmaster Inc. v. Piccione, 2010 ONSC 846, at paragraph 19, varied [2011] O.J. No. 3083 (C.A.).

[^18]: See Aacurate General Contracting Ltd. v. Tarasco, 2015 ONSC 5980, at paragraph 15.

[^19]: See Brough and Whicher Ltd. v. Lebeznick, 2017 ONSC 1392, at paragraph 10.

[^20]: See Canfield v. Brockville Ontario Speedway, 2018 ONSC 3288, at paragraph 11.

[^21]: See CNH Canada Ltd. v. Chesterman Farm Equipment Ltd., 2018 ONCA 637, at paragraph 89. At paragraph 91 of the same decision, our Court of Appeal also noted, with apparent approval, the following comments of the Tribunal that awarded costs at first instance: “Proportionality is something to be considered. An unfortunate reality of modern litigation is that frequently the costs of litigating can exceed the amount claimed or the amount recovered. However, the Tribunal is not bound to any proportionality formula. It would be unfair to use the proportionality principle to deny a successful party of [sic] a cost award.”

[^22]: See, again, Aacurate General Contracting Ltd. v. Tarasco, supra, at paragraph 15.

[^23]: In this context, I am focused on the lack of formal concessions made by either party in terms of the issues to be addressed at trial, which increased the length and complexity of that trial. The separate matter of without prejudice settlement offers is addressed below.

[^24]: See Grobe Nursery Ltd. v. Scharf, 2011 ONSC 729, at paragraph 7.

[^25]: In the cost submissions delivered on behalf of Mr Syson, reliance was placed on this court’s decision in 2283624 Ontario Limited v. Performance Painting & Floor Coating Ltd., 2017 ONSC 4010, at paragraphs 10-12, wherein Justice Carey criticized the unsuccessful plaintiff and construction lien claimant for bringing an action in the Superior Court of Justice pursuant to the Construction Lien Act, supra, instead of in the Small Claims Court, for what seemed to be “purely strategic reasons”, thereby causing all concerned to incur costs disproportionate to the plaintiff’s claim. However, that was also a case in which the court found the matter was not the proper subject of a construction lien claim at all, which is not the situation in the case before me.

[^26]: Rule 76.01(1)(b) has been amended to refer to the Construction Act, supra, instead of the Construction Lien Act, supra, but the substantive provisions making the Rule 76 simplified procedure generally inapplicable to construction lien actions remains unchanged. As noted above, Mr Syson relied upon Justice Carey’s decision in 2283624 Ontario Limited v. Performance Painting & Floor Coating Ltd., supra. In that case, the court faulted the plaintiff in that construction lien litigation not only for failing to bring the matter in the Small Claims Court, but also for not using the simplified procedure outlined in Rule 76. However, as noted above, that was a case where the court also had found that the matter was not the proper subject of a construction lien in the first place, which distinguishes that case from the situation in this litigation. In other construction lien cases, contractual disputes between the parties have been allowed to move forward under the Rule 76 simplified procedure, but only after requests relating to enforcement of a construction lien had been withdrawn and/or dismissed, thereby effectively taking the matter outside the ambit of the Construction Lien Act, supra. See, for example: 986506 Ontario Ltd. v. Pringle (2003), 30 C.L.R. (3d) 286 (Ont.Master).

[^27]: See sections 51 and 58 of the Construction Lien Act, supra, as it read on June 28, 2018. In the amendments transforming the legislation into the current Construction Act, supra, the Legislature appears to have recognized and taken steps to address concerns about construction lien disputes, involving relatively modest monetary disputes, taking up precious trial time in the Superior Court of Justice instead of being tried in the Small Claims Court. In particular, pursuant to what is now s.58(1)(c) of the Construction Act, supra, a Superior Court Judge also now has jurisdiction, upon a motion brought by either party, to refer construction lien litigation to a deputy judge of the Small Claims Court, or the Small Claims Court Administrative Judge, if the action is for amounts within the monetary jurisdiction of the Small Claims Court.

[^28]: In saying that, I am mindful that Rule 54.02 permits a judge “at any time” to direct a reference of the whole proceeding or a reference to determine an issue in certain circumstances, including situations where “a prolonged examination of documents or an investigating is required that, in the opinion of the judge, cannot conveniently be made at trial”. However, pursuant to s.50(1) of the Construction Lien Act, supra, as it read on June 28, 2018, construction lien matters were to be enforced in the Superior Court of Justice “in accordance with the procedure set out in this Part”; i.e., Part VIII of the legislation as it read on that date, including the provisions indicating that such disputes could be referred to a master, case management master or other person agreed upon by the parties only “on motion” by one of the parties. Pursuant to s.50(2) of the Construction Act, supra, the civil litigation procedures generally prescribed by the Courts of Justice Act and rules of court apply to actions brought in the Superior Court of Justice in relation to construction lien disputes, “except to the extent they are inconsistent with” the Construction Act and the procedures prescribed in Part VIII of that amended legislation. The provisions therein specifically addressing when and to whom such references made arguably supersede the more general provisions of Rule 54 dealing with references, thereby once again granting the court the ability to direct a reference in relation to construction lien disputes only “on motion” by one or more parties.

[^29]: See Elbakhiet v. Palmer, 2012 ONSC 2529, [2012] O.J. No. 2890 (S.C.J.), at paragraph 30.1, in turn citing Norton v. Kerrigan, [2004] O.T.C. 559 (S.C.J.), at paragraphs 15-16, Joncas v. Spruce Falls Power & Paper Co., [2001] O.J. No. 1939 (C.A.), and Foulis v. Robinson (1978), 1978 CanLII 1307 (ON CA), 21 O.R. (2d) 769 (C.A.), at p.776.

[^30]: See, for example, Brough and Wicher Ltd. v. Lebeznick, supra, at paragraph 8.

[^31]: See Rule 57.01(2) of the Rules of Civil Procedure.

[^32]: See Rule 57.01(4)(a) of the Rules of Civil Procedure.

[^33]: See, for example: Arthur J. Brown Ltd. v. Chantry House Inn Ltd. (1988), 11 A.C.W.S. (3d) 361 (Ont.H.C.J.), at paragraph 68; Kong Wah Holdings Ltd. (Liquidator of) v. Yong (2006), 152 A.C.W.S. (3d) 1016 (Ont.S.C.J.), at paragraphs 5-6; Super A Hotels Investment and Management Group (Canada) Inc. v. 1205723 Ontario Inc., 2015 ONSC 5189, at paragraphs 5 and 7; Brough and Wicher Ltd. v. Lebeznick, supra, at paragraph 8; and Luckevich v. Ivany, 2018 ONCA 254 at paragraph 3.

[^34]: While I reviewed and considered those estimates/quotes in the course of preparing my judgment, and referred to them at sub-paragraph 33(b)(A), I did not include an indication of the precise totals indicated therein.

[^35]: See for example: Tricontinental Investments Co. v. Guarantee Co. of North America (1988), 29 C.P.C. (2d) 99 (Ont.H.C.); William Allan Real Estate Co. v. Robichaud (1990), 1990 CanLII 6884 (ON SC), 72 O.R. (2d) 595 (H.C.J.); Oakville Storage & Forwarders Ltd. v. Canadian National Railway Co. (1991), 1991 CanLII 7060 (ON CA), 5 O.R. (3d) 1 (C.A.), leave to appeal to the Supreme Court of Canada refused (1992), 6 O.R. (3d) xiii (note).

[^36]: In its written cost submissions, LER also noted and relied upon the fact that it had served an offer to settle this cost dispute on certain terms. In my view, however, LER should not have disclosed a settlement offer relating to the very issue the court was in the process of deciding.

[^37]: See, for example, Malik v. Sirois, 2003 CanLII 29931 (ON CA), [2003] O.J. No. 3488 (C.A.), and Rooney v. Graham (2001), 2001 CanLII 24064 (ON CA), 53 O.R. (3d) 685 (C.A.).

[^38]: See Mathur v. Commercial Union Assurance Co. of Canada, [1988] O.J. No. 144 (Div.Ct.).

[^39]: See Marcus v. Cochrane, supra, at paragraph 16.

[^40]: I have extended the time for payment of the costs awarded to allow for the possibility that current limitations on regular business and banking operations, because of the ongoing COVID-19 crisis, might delay Mr Syson’s ability to make required financing arrangements.