COURT FILE NO.: CV-09-375015

MOTION HEARD: 20201215

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Imvescor Restaurants Inc., Plaintiff

AND:

4287975 Canada Inc., Peter Shandal, Manon Deschamps, Giovanni Piccinini (a.k.a. Giovanni Piccinni), Carmelina Piccinini (a.k.a. Carmelina Piccinni), Defendants

BEFORE: Master B. McAfee

COUNSEL: Z. Smith, Counsel, and H. Mohamadhossen, Student, for the Plaintiff, Defendant to the Counterclaim, Imvescor Restaurants Inc.

E. Ifergan, Counsel, for the Defendant, Plaintiff by Counterclaim 4287975 Canada, and for the Defendants Manon Deschamps Giovanni Piccinini (a.k.a. Giovanni Piccinni), Carmelina Piccinini (a.k.a. Carmelina Piccinni)

HEARD: December 15, 2020

REASONS FOR DECISION

[1] As set out in the notice of motion, the plaintiff, defendant to the counterclaim Imvescor Restaurants Inc. (Imvescor) brings this motion for an order that the defendant, plaintiff by counterclaim 4287975 Canada Inc. (428Co) pay into court to the credit of the action the amount set out in the estimated bill of costs within 10 days. At the outset of the motion Imvescor confirmed the amount sought to be posted for security for costs was partial indemnity costs for the counterclaim in the all-inclusive amount of $174,000.00. Imvescor requests that the amount be posted on or before December 31, 2020.

[2] The trial of this action is scheduled for January 18, 2021, approximately one month from now. Due to the fact that this motion was scheduled so close to the commencement of the pending trial, it was necessary for the court to prepare these reasons on an expedited basis to allow the parties to know where they stood with respect to this relief as far in advance of the trial date as possible.

[3] Master Brott heard Imvescor’s long motion for security for costs of the counterclaim and the motion of the then third parties for an order for security for costs. For Reasons for Decision dated July 31, 2014, Master Brott ordered as follows:

[35] For reasons outlined above, [the third parties’] motion for security for costs is dismissed with costs. 428 shall post security for costs incurred to date and for prospective costs in favour of Imvescor. Security for costs shall be paid on an installment basis. The first installment shall be for costs in the amount of $50,000.00 plus HST plus disbursements through the completion of examinations for discovery of all parties.

[4] No order was made with respect to any further installments.

[5] Master Brott’s order was not appealed. There was no motion to set aside or vary Master Brott’s order. 428Co did not bring a motion to decrease the security ordered by the Master.

[6] There is no issue that the further security at issue is only with respect to the counterclaim.

[7] 428Co agrees that further security ought to be posted. 428Co submits that the amount sought for further security is too high. 428Co. submits that a fair and reasonable amount to be posted is the further partial indemnity amount of $45,000.00.

[8] As stated by Master McGraw in Rayman Tiger Inc. v. Unger Tiger Inc., 2020 ONSC 691 (Ont. S.C.J.) at para. 30, in determining the amount of further security which is just in the circumstances the court has a broad discretion to determine a fair and reasonable amount.

[9] I have considered the material before me and the submissions of the parties. I am satisfied that it is just in all the circumstances to order that the further all-inclusive amount of $70,000.00 be posted for security for Imvescor’s costs of the counterclaim.

[10] The parties disagree on the complexity and time involved in the counterclaim. Imvescor submits that they are being conservative in their submission that one half of the estimated time for this proceeding ought to be attributed to the counterclaim. Imvescor has not served an expert report for the purposes of the counterclaim or at all. The counterclaim at issue was not before me. What is before me in Imvescor’s position that the counterclaim is an abuse of process because it seeks to duplicate relief sought in a separate application that has already been pursued unsuccessfully through various stages of litigation. If the matters in the counterclaim have already been litigated in a separate proceeding, on the record before me I am not satisfied that at least one half of future time will be attributable to the counterclaim.

[11] The estimated hours sought in the bill of costs are high. Imvescor is seeking 30 hours of lawyers’ time for the pre-trial related only to the counterclaim. Imvescor is also seeking 190 hours of lawyers’ time for trial preparation and 60 hours of lawyers’ time related only to the counterclaim. This means that Imvescor is attributing the total of 60 hours for the pre-trial, 380 hours for trial preparation and 120 hours for the trial for the entire proceeding. The trial estimate is 10 days. While I can accept that attributing approximately 12 hours a day of lawyers’ time when in trial is reasonable, the estimates for the other amounts are far too high.

[12] With respect to the hourly rates set out in the bill of costs, 289Co takes the position that the amounts are in excess of the Tariff, even adjusted for inflation, and should not be allowed. While the hourly rates are high, I disagree with the position of 289Co in this regard. In Fairfield Sentry Ltd. v. PricewaterhouseCoopers LLP, 2015 ONSC 4961 (Ont. S.C.J.) at para. 7, Justice Newbould stated: To order security for costs on the basis of an outdated recommendation made over 15 years ago would not be realistic at all.

[13] I have not discounted the partial indemnity rates sought, represented to be 60% of the actual rates as set out in the bill of costs. My determination with respect to hourly rates is for the purpose of this motion only.

[14] To the extent that 428Co argues that Master Brott’s order for the first installment was excessive, there is no motion to decrease the security ordered by the Master. The Master does not indicate how the quantum for the first installment was determined. At this late stage in the proceedings and in these circumstances, I am not prepared to revisit the amount of security ordered by the Master for the first installment. I am only prepared to consider the further security sought on this motion, being the relief sought in Imvescor’s notice of motion.

[15] When the matter was before Master Brott, there was a third party claim and time with respect to third parties did appear in Imvescor’s bill of costs that was submitted to the Master. The third party claim was subsequently dismissed without costs. Pleadings with respect to the third party claim or any third party defence to the main action were not before me. On the basis of the record before me I cannot determine the impact, if any, the dismissal of the third party claim has on the further estimated costs of the counterclaim.

[16] 289Co did not file their own estimated bill of costs to assist with determination of a fair and reasonable amount that 289Co could reasonably expect to pay.

[17] Having considered the material before me and the submissions of the parties, I order that a further all-inclusive installment of $70,000.00 be paid into court for security for Imvescor’s costs of the counterclaim including the pre-trial conference and all remaining steps. The further amount shall be paid into court to the credit of the counterclaim or before December 31, 2020.

[18] With respect to costs of this motion, I award the all-inclusive sum of $2,000.00 to 428Co, payable to 428Co in the cause on the counterclaim. The amount of further security ordered with respect to the counterclaim was closer to the position taken by 428Co on this motion. In addition, 428Co did attempt to settle the issue of further security. Imvescor did not respond to 428Co’s offer to settle or make any offer to settle the amount of further security to be posted.

[19] The notice of motion was recently amended to add a request for leave to amend the statement of claim and the reply and defence to counterclaim. The motion was confirmed on the basis that this added relief was not being pursued at the return of the motion. On consent, the motion for leave to amend is adjourned sine die.

Master B. McAfee

Date: December 16, 2020