Court File and Parties

COURT FILE NO.: CV-14-501607

DATE: 20201217

SUPERIOR COURT OF JUSTICE – ONTARIO

RE: THE ESTATE OF DONNA S. FARRAGE, DECEASED, BY HER EXECUTOR WILLIAM FARRAGE, WILLIAM FARRAGE, RIYAD FARRAGE, ANTON FARRAGE, NICHOLAS FARRAGE and NICOLE FARRAGE, Plaintiffs (Respondents)

AND:

DR. JOAN WENDY D'ANDREA, DR. RAYMOND JOHN OSBORNE, DR. LUC ROELAND CLEMENS WILLEM VAN LONKHUIJZEN and SUNNYBROOK HEALTH SCIENCES CENTRE, Defendants (Appellants)

AND:

DYNACARE GAMMA LABORATORY PARTNERSHIP, Third Party (Appellant)

BEFORE: A.A. Sanfilippo J.

COUNSEL: Mitchell Wine, lawyer for the Plaintiffs

Paul Veel and Scott Azzopardi for the Defendants (Appellants), Dr. Joan Wendy D’Andrea and Dr. Raymond John Osborne

Erica Baron and Simon Cameron for the Defendants (Appellants), Dr. Luc Roeland Clemens Willem van Lonkhuijzen

Robyn Grant and Victoria Cistrone, for the Defendant (Appellant) Sunnybrook Health Sciences Centre

Ryann Atkins, for the Third Party (Appellant) Dynacare Gamma Laboratory Partnership

HEARD

In Writing: December 17, 2020

ENDORSEMENT ON COSTS

[1] By Reasons for Decision issued August 31, 2020, I determined the appeal brought by the defendants from the decision of Master D.E. Short dated January 17, 2020, wherein the Master had extended the time for the plaintiffs to set this action down for trial and awarded costs of the motion to the plaintiffs: Farrage v. D’Andrea, 2020 ONSC 2 (the “Master’s Order”). I affirmed the Master’s decision to extend the time for the plaintiffs to set this action down for trial, but on my reasons, which differed from those of the Master. I set aside the Master’s Order of costs of the motion to the plaintiffs and ordered, instead, that no party shall receive an award of costs of the Master’s motion: Farrage Estate v. D’Andrea, 2020 ONSC 5200, at para. 5.

[2] I encouraged the parties to confer and agree on the issue of costs of the Appeal. They were unable to reach a resolution. At a case conference conducted at the parties’ request on October 14, 2020, I implemented a process for the parties to deliver written submissions on costs in accordance with Rule 57.01(7) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. They have done so, and I have determined the issue of costs in writing.

[3] For the reasons that follow, I have determined that all parties shall bear their own costs of this Appeal.

A. The Parties’ Positions

[4] The plaintiffs/respondents, the Estate of Donna Farrage and family members of the late Donna Farrage (collectively the “Respondents”) submitted that they were successful in affirming the Master’s Order, and thereby should receive an award of costs. The Respondents filed a Costs Outline that detailed their claim for $16,912.99 in costs, consisting of $14,850 in legal fees, disbursements of $117.25 and applicable taxes of $1,045.74.

[5] The defendants/appellants, Dr. Joan Wendy D’Andrea, Dr. Raymond John Osborne, Dr. Luc Roeland Clemens Willem van Lonkhuijzen, Sunnybrook Health Sciences Centre and Dynacare Gamma Laboratory Partnership (collectively the “Appellants”) submitted that there was divided success on the Appeal, such that each party should bear its own costs of the Appeal. Alternatively, if the Respondents establish entitlement to an award in costs, the Appellants contended that the amount of any award should be substantially reduced to reflect the divided success on the Appeal.

B. Analysis

[6] The Appeal involved two parts: first, a determination of whether there were errors in the Master’s decision that rendered it unsustainable, and; second, if so, would a new determination of the Rule 48.14(7) Motion, heard de novo either by a Master or by the Appeal Judge, under s. 134 of the Courts of Justice Act, R.S.O. 1990, c. C.43, have produced a different outcome. The Appellants were successful in the first part. The Respondents were successful in the second part.

[7] The Respondents’ submissions in support of the sustainability of the Master’s decision were found to be without merit. The Respondents’ written cost submissions seek to distance the Respondents from the error of law (or palpable and overriding error of mixed fact and law) that I found in the Master’s decision, but the Respondents’ submissions both before the Master and on Appeal regarding the two-part test required by Rule 48.14(7) were not founded on prevailing law. The Respondents’ submission that the Master’s reliance on evidence not in the record could be disregarded as obiter dicta, and that his misapprehension of evidence did not detract from his exercise of discretion on proper principles were without merit. The Respondents were unsuccessful on this part of the Appeal, and this factors in my determination of costs.

[8] The Appellants’ success in their challenge of the Master’s decision could yield only two possible outcomes: the Rule 48.14(7) Motion would be remitted to a Master for a new hearing; or the Motion would be determined by the Appeal Judge on the record filed, in accordance with s. 134 of the Courts of Justice Act. In other words, success on the Appeal of the Master’s decision meant that the Motion had to be reheard, which meant that the critical issue to this Action was whether the outcome of the Motion – the extension of time for this action to be set down for trial – would be affirmed or reversed: whether by the Appeal Judge or by a Master on re-hearing. On this determinative issue, the Appellants were unsuccessful.

[9] Section 131 of the Courts of Justice Act provides the court with discretion to determine the amount of costs. The exercise of this discretion is guided by the factors set out in Rule 57.01 of the Rules of Civil Procedure, and applicable jurisprudence

[10] The general rule is that, absent special circumstances, “costs follow the event”: Bell Canada v. Olympia & York Developments Ltd. (1994), 1994 239 (ON CA), 17 O.R. (3d) 135; Yelda v. Vu, 2013 ONSC 5903, leave to appeal refused, 2014 ONCA 353, at para 11. In Ehsaan v. Zare, 2018 ONCA 453 at para. 10, the Court of Appeal held that the “general principle that a successful party is entitled to costs should not be departed from except for very good reasons.” Here, each party had success on one of the two steps involved in this Appeal. In my view, this is a clear case of divided success on this Appeal.

[11] Rule 57.01(1) requires that the court consider “the result in the proceeding” in assessing the issue of costs, although it does not expressly list “divided success” as one of the factors for the court to consider in its exercise of discretion on the issue of costs. This contrasts with the express statement of this factor in Rule 24(6) of the Family Law Rules, O. Reg. 114/99: “If success in a step in a case is divided, the court may apportion costs as appropriate”. However, a review of the case authorities shows the importance of consideration of divided success in the exercise of discretion on the issue of costs.

[12] In Lowndes v. Summit Ford Sales Ltd. (2006), 2006 11654 (ON CA), 48 C.C.E.L. (3d) 194 (Ont. C.A.), at para. 3, the Court of Appeal stated, as a general principle, that “where success on appeal is substantially divided, as in this case, an award of costs of the appeal will not be made.” This principles is seen as well in the Court of Appeal’s determination on costs in Isaacs v. MHG International Ltd. (1984), 1984 1862 (ON CA), 7 D.L.R. (4th) 570, at p. 573: “Having heard submissions on the question of costs of the appeal, we feel that the success of the appeal was divided; the appellant has been successful only on the aspect of costs and unsuccessful on the other portions of the appeal. Having regard to all the circumstances we think, in fairness, that there should be no costs to either party.”

[13] My assessment of the listed factors under Rule 57.01 showed that the factors balanced equally between the parties. The Appeal was important to all parties: Rule 57.01(d). The Appeal was important to the Respondents as it would determine the ongoing viability of their Action, and the findings made by the Master were important to the Appellants, as was his decision. The conduct of all parties equally “tended to … lengthen unnecessarily the duration of the proceeding”: Rule 57.01(e). The Respondents raised positions that were unsustainable. The Appellants’ approach to the extension of time sought by the Respondents to set this Action down for trial has resulted in a longer period of delay in this Action than if the timetable proposed by the Respondents had been accepted and implemented.

[14] There were no offers to settle exchanged by the parties under Rules 49.02(2) and 49.10. However, the Respondent offered, prior to the Motion, to comply with a timetable that would have caused this Action to be set down for trial by now. While this factor is in favour of the Respondents, it is balanced by two factors in favour of the Appellants: (i) the Appellants succeeded on their Appeal of the Master’s award of costs; (ii) I accept the Appellants’ submission that the costs of the rehearing of the substance of the Rule 48.14(7) – being the part of the Appeal on which the Respondents were successful – was modest because this determination required no expansion of the Appeal Record, no increased briefing in factum material and little expansion of the submissions made on the Appeal.

[15] My exercise of discretion on the issue of costs must be based on my determination of what is fair, just and reasonable: Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291 (C.A.); Zesta Engineering Ltd. v. Cloutier (2002), 2002 25577 (ON CA), 21 C.C.E.L. (3d) 161 (Ont. C.A.). Taking all relevant factors into consideration, including the divided success on this Appeal and all factors set out in Rule 57.01, I conclude that a fair, just and reasonable disposition is to exercise my discretion to award no costs of the Appeal, and to thereby order that all parties shall bear their own costs of the Appeal.

C. Disposition

[16] I order that all parties shall bear their own costs of this Appeal.

[17] Notwithstanding Rule 59.05, this order is effective from the date that it is made and is enforceable without the need for entry and filing. In accordance with Rules 77.07(6) and 1.04, no formal order need be entered and filed unless an appeal or a motion for leave to appeal is brought to an appellate court. Any party may nonetheless submit a formal order for original signing, entry and filing should the party wish to do so.

A.A. Sanfilippo, J.

Date: December 17, 2020