COURT FILE NO.: CV-13-480572

DATE: January 31, 2020

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Prasher Steel Ltd. v. Maystar General Contractors Inc.;

BEFORE: MASTER C. WIEBE

COUNSEL: Angela Assuras for Prasher Steel Ltd. (“Prasher”); Rocco A. Russo for Maystar General Contractors Inc. (“Maystar”).

DECISION: November 14, 2019.

COSTS DECISION

[1] On November 14, 2019 I rendered my decision on the Prasher motion to enforce the settlement. I ordered Maystar pay Prasher $286,061.10 pursuant to that settlement. I also ordered that the parties make written submission as to the costs of that motion.

[2] In her written submission on costs dated November 22, 2019, Ms. Assuras indicated that Prasher is seeking two orders as to costs: $10,056.43 in partial indemnity costs for this motion plus $700 for the costs incurred after the hearing of the motion; $38,807.87 in partial indemnity costs for the action (other than this motion). Concerning the second request for costs, Ms. Assuras pointed to paragraph 8 of the Minutes of Settlement which specifies that in the event of a default of payment of the Settlement Funds, Prasher is to be paid not only $611,061.10 less any principal payments received, but also “Prasher’s legal costs of the action.” In his Responding Costs Submissions Mr. Russo objected to this second request for costs stating that Prasher had not sought this relief in the motion. In any event, he asked for an opportunity to make further written submissions in the event I entertained this claim.

[3] I reviewed the written costs submissions and the motion record. I concluded that Prasher had in its motion sought generally to enforce the Minutes of Settlement and that it had not limited its motion to the recovery of the principal amount. Therefore, in fairness to Maystar I decided to have the parties make further written submissions as to the costs of the action in addition to the costs of the motion. By email dated January 10, 2020 I informed the parties of this decision and set a schedule. I have received and reviewed these further written costs submissions.

Costs of the action

[4] Mr. Russo argued initially that the parties agreed that the settlement amount was inclusive of costs, and that, therefore, Prasher is not entitled in addition to its costs of the action. The Minutes of Settlement are a clear rebuttal to this argument. As stated above, paragraph 8 of the Minutes makes it clear that, in the event of a default, Prasher will be paid the agreed to principal amount less payments received “plus” Prasher’s legal costs of the action. I do not accept this argument.

[5] Mr. Russo then argued that Prasher is not entitled to substantial indemnity costs. In response, Ms. Assuras clarified that Prasher is seeking partial indemnity costs, not substantial indemnity costs. As proof, she pointed to the fact that the Prasher bill of costs was based on fees for carriage counsel, Adam Wainstock, calculated at $180 per hour. This is about 62% of the actual fees Prasher paid as shown in the dockets attached to Ms. Assuras’ reply submissions. The disbursements are claimed at cost, which is the usual approach. As a result, I am satisfied that Prasher is indeed claiming partial indemnity costs of the action (other than this motion).

[6] Mr. Russo pointed out that the amount of $18,000 (the amount paid to the Union) should be deducted from any recovery for Prasher, as I had so ordered on consent on August 4, 2015. In reply Ms. Assuras conceded this deduction. I will make this deduction.

[7] Mr. Russo argued that I should award Prasher the amount of $20,000 less the $18,000 for the Union payment for a net amount of $2,000. What Prasher now claims is $38,807.87 less the Union payment for a net amount of $20,807.87. Mr. Russo’s primary complaint is that the Prasher bill of costs attaches only the invoices that were rendered to Prasher, and that these invoices do not identify the time that was spent on tasks. In her reply, Ms. Assuras attaches all of Mr. Wainstock’s dockets for fees and disbursements. These dockets show that $45,319.15 plus HST was spent on fees, and that $6,626.18 plus HST was spent on disbursements.

[8] On balance I do not find the Prasher claim exorbitant. Prasher had to incur the cost of preparing and registering its claim for lien. There was the motion for a judgment of reference. There was a total of seven trial management conferences with me. The Prasher stream initially involved the Union claim as well as the Prasher claim. I ordered affidavits of documents, productions, a Scott Schedule, examinations for discovery (14 hours for each side), and requests to admit. There was also a mediation. On February 7, 2017 I scheduled a 10 day viva voce trial in the Prasher action starting on August 1, 2017. Witness statements had to be prepared. Trial preparation had to be done. It was only on the eve of the trial hearing, on July 27, 2017, that this case was settled on terms that, as I have found, amounted to a tantamount admission by Maystar of the merits of the Prasher claim.

[9] Mr. Russo argues that I should make a deduction on account of the time Prasher included in its costs submission for defending the Union claim. The Union claim was originally $38,318.52. It became clear early in the reference that there was more than sufficient Prasher holdback to cover the Union claim for lien. Therefore, Maystar had no interest in the Union action. Furthermore, it because clear in the early trial management conferences that the issues in the Union claim were accounting issues as between the Union and Prasher. These issues caused the Union claim to linger on. It was no sooner than my 4th set of directions on August 4, 2015, namely over a year into the reference, that I made the consent final order requiring that Maystar pay the Union $18,000, namely just under half the Union claim. As a result, I agree that Maystar should not have to pay Prasher costs incurred on account of the Union claim.

[10] The quantification of these costs is an issue. I note that the invoices from Mr. Wainstock for the period up to and including the August 4, 2015 trial management conference total about $22,000. The dockets Ms. Assuras supplied in the Further Costs Submissions dated January 22, 2020 are not helpful as they are hard to read and are not assigned to particular claims. Therefore, I have decided to apply a deduction of about 1/3 of $22,000, or $7,500, on account of the Union claim.

[11] Applying the deductions to the Prasher claim of $38,318.52 produces the following: $38,318.52 - $18,000 - $7,500 = $12,818.52. Pursuant to the Minutes of Settlement between the parties, I find that Maystar must pay Prasher partial indemnity costs of $12,000 for the costs of the action (other than this motion).

Costs of the motion

[12] Concerning the motion, there is no doubt that Prasher was entirely successful in its motion and deserves cost. Maystar did serve an offer to settle on July 4, 2019, but Prasher clearly “beat” this offer to settle as it was an offer to have the motion withdrawn without costs. If anything, this offer shows Maystar’s misplaced confidence in its position.

[13] Mr. Russo raised issues of conduct. He argued that Prasher’s costs should be reduced because of the many affidavits Prasher filed. I recall these affidavits and found them all helpful in the end. Mr. Russo argued that Prasher should be penalized for unilaterally scheduling the motion originally for July 31, 2019. I accept Ms. Assuras response that she picked this date when Mr. Russo advised her the motion could be brought in July, 2019. In any event, the issue is moot as the motion was eventually rescheduled on consent to be heard on November 12, 2019.

[14] In my view, the most important factor is the reasonable expectation of the unsuccessful party on this motion, namely Maystar. Comparing the two costs outlines of the parties, I find that the time spent by the parties on this motion was about the same. The reason for the difference in partial indemnity costs shown on these two costs outlines is the following: the use by Maystar of less costly counsel; and the use by Maystar of junior counsel and a law clerk to reduce the costs. This was reasonable on the part of Maystar. It was Prasher’s choice to hire more senior and expensive counsel to bring this motion. While I commend Ms. Assuras for her work on this motion, the motion itself was not complex and did not justify the additional expense.

[15] There is no issue that the standard of costs should be partial indemnity costs. Maystar’s defence to the motion was not unreasonable. I award partial indemnity costs.

[16] I, therefore, find that Maystar must Prasher partial indemnity costs of $6,500, which is approximately the amount of the partial indemnity costs for fees shown on the Maystar costs outline plus Prasher’s disbursements and an amount for the further written costs submissions. Generally, and in any event, I find this costs award to be reasonable in the circumstances. This was not a significantly complex motion. These costs must be paid in 30 days from today.

DATE: January 31, 2020 __________________________

MASTER C. WIEBE