COURT FILE NO.: CV-17-74933

DATE: 20210428

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: ST. LAWRENCE PARKS COMMISSION, Plaintiff

-and-

JOHN GORDON CONSTRUCTION INC., TIMOTHY MACDOUGALL, MACDOUGALL HOMES AND CONTRACTING LTD., LES INDUSTRIES HARNOIS INC., and ABC MEGADOME COMPANY, Defendants

BEFORE: Mr. Justice Pierre E. Roger

COUNSEL: Alan S. Cofman/Andrea Fernandes, for the Plaintiff

Tara Lemke, for the Defendant, John Gordon Construction Inc.

Matthew Malcolm, for the Defendants, Timothy MacDougall and MacDougall Homes and Contracting Ltd.

Noémie Bégin, for the Defendant, Les Industries Harnois Inc.

HEARD: In writing

ENDORSEMENT on Costs

Background

[1] The defendants each brought a motion for summary judgment seeking the dismissal of the plaintiff’s action. They argued that there was no genuine issue requiring a trial and that the plaintiff’s action had been brought outside of the two-year limitation period.

[2] The plaintiff is an agency of the Government of Ontario, the owner of the Crysler Park Marina located in Morrisburg, Ontario. The action is over the quality of a prefabricated building delivered by the defendants.

[3] The defendants are the general contractor, the subcontractor/distributor, and the manufacturer of the large Megadome that the defendants installed at the plaintiff’s marina.

[4] I dismissed the defendants’ motions for summary judgment: St. Lawrence Parks v. John Gordon Construction, 2021 ONSC 2527. I found that the defendants had not met their initial evidentiary burden of demonstrating that there is no genuine issue requiring a trial with respect to their defence and that they had not demonstrated that the action was started out of time.

[5] The parties have been unable to agree on the issue of the costs of these motions.

Issue

[6] The issue to be decided is the amount of costs payable to the plaintiff for defending the unsuccessful motions for summary judgment brought by the defendants.

Analysis

[7] The costs of and incidental to a proceeding or of a step in a proceeding are at the discretion of the court: s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43. Rule 57 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (“the Rules”) provides for certain factors that the court may consider when determining costs.

[8] When determining costs, the overall objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay, while also considering the other objectives of a costs award, including that of indemnity for the costs of litigation incurred by the successful litigant, that of encouraging settlements, and that of discouraging and sanctioning inappropriate behaviour by litigants.

[9] The plaintiff seeks $50,000 as elevated costs or, alternatively, $40,000 as its partial indemnity costs, inclusive of disbursements (inclusive of experts’ fees). The plaintiff argues that it had offered to settle the costs of the motions for $30,000 before the motions were heard, which offer was rejected. The plaintiff also argues that their cited rates are specially reduced rates for certain insurers, and that the regular commercial rates for their lawyers in 2021 are $460/hr and $325/hr, respectively. The plaintiff argues that although its victory was not a foregone conclusion, the motions could not have been determined as matters of “full” summary judgment, as these were really “partial” summary judgment motions.

[10] The defendants argue that the plaintiff’s costs are excessive. For example, the defendant Gordon says that a review of the plaintiff’s costs outline shows duplication as well as excessive time spent. They point out that the plaintiff spent a total of 126.9 hours defending this motion, while they say that the defendant Gordon spent 76.5 hours, for all-inclusive partial indemnity costs of about $10,000. The defendant MacDougall also says that $10,000 would be a more reasonable amount. They, and the defendant Harnois, say that the plaintiff is seeking costs for two lawyers for all steps involved, and that two lawyers were not justified for every step. They argue that the second lawyer on the file billed $17,847.50, that if these fees were removed, the plaintiff’s fees would be reduced to $20,150, and partial indemnity fees would be in the range of about $13,000. The defendants all dispute the plaintiff’s characterization of their conduct. They all say, with detailed particulars, that the plaintiff did not respond to numerous correspondence, did not answer any of its undertakings (they say that the plaintiff still has not done so), and that given the plaintiff’s lack of response and lack of any expert evidence to support its claim, the defendants sought instructions to bring summary judgment motions.

[11] None of the offers referred to the court are applicable to trigger a higher scale of costs, and none warrants a higher scale of costs. Similarly, the conduct of the defendants was not improper or approaching a level that could warrant a higher scale of costs. On the facts and circumstances of this case, the defendants did not act unreasonably or in bad faith for the purpose of delay when bringing and scheduling these motions for summary judgment, although I found that their evidence was not sufficiently developed and that some form of partial summary judgment would not have been in the interests of justice.

[12] The plaintiff is therefore entitled to the costs of defending the motions for summary judgment on a partial indemnity basis.

[13] The plaintiff was entirely successful in its defence of the motions for summary judgment. The unsuccessful parties should have expected that the plaintiff’s costs would exceed their own costs as the plaintiff had to respond to three motions, although similar. This action seeks damages in the range of about $450,000, and these were important motions to the parties. Some of the issues raised by these motions were of moderate complexity, although these were not fully developed by the parties. The limitation period argument had very little chance of success on the evidence presented to the court, and the defendants had not sufficiently developed the evidence to show that their respective defence did not raise a genuine issue requiring a trial.

[14] Bringing unsuccessful motions for summary judgment invariably causes delay and increases costs to the parties. It also unproductively occupies the court and prevents it from dealing with other more productive matters.

[15] The plaintiff’s repeated failures to promptly answer undertakings and to promptly deliver expert reports might explain, to some limited extent, why these motions were brought, although on the evidence presented to the court, these motions unnecessarily lengthened the duration of these proceedings. A more proportional and efficient response to the plaintiff’s delays would have included the defendants scheduling a case conference to timeline the delivery of evidence and of next steps. Once the evidence was sufficiently developed, the defendants could have better assessed the most efficient method to fairly resolve this matter, which might then have included a motion for summary judgment.

[16] The plaintiff’s actual costs to defend these motions total $58,840. Included therein is an amount of $13,316 for the fees of their experts, which includes $3,778.72 for the experts preparing for and attending at their cross-examination for these motions.

[17] Consequently, I find that $9,537 of the plaintiff’s $13,316 in expert fees was necessary with or without these summary judgment motions; and therefore, the portion of the plaintiff’s expert fees in the amount of $9,537 will be more appropriately dealt with at the conclusion of trial. That amount is therefore excluded from my assessment of the costs of these motions, but the amount of $3,778.72 is allowed as it relates more specifically to these motions.

[18] It was helpful that each of the defendants filed a costs outline. These show their respective partial indemnity costs ranging from about $10,000, $12,000 and $20,000. However, as indicated above, it should not surprise the defendants that the plaintiff’s costs to defend three similar motions for summary judgment exceed those of each individual defendant. Some of the plaintiff’s costs to defend these motions are somewhat excessive, for example the matter was not sufficiently complex to justify two lawyers involved at most every step. Nonetheless, parties should also be encouraged to resolve issues of costs.

[19] Considering the arguments of all parties, what seems fair and reasonable, in the circumstances of this case, is to fix the plaintiff’s partial indemnity costs for responding to these motions in the all-inclusive amount of $33,000.

[20] The plaintiff also asks this Court to order, in addition to costs, that the matter proceed to a case management conference and a second mediation. The defendants submit that these issues should be discussed amongst counsel, that the court’s assistance be sought only if necessary, and that another mediation is not appropriate at this time as the plaintiff’s undertakings remain outstanding.

[21] The Rules, including rule 50.13, give the court wide discretion to order a case conference. It is apparent from the parties’ submissions that this case would benefit from a case conference in order to explore how outstanding issues might effectively be resolved and to establish a timetable for the proceeding, including for the answer of outstanding undertakings and for the delivery of expert reports. It would be more helpful if I presided at this case conference, considering that I heard the motions for summary judgment.

Conclusion

[22] The following is therefore ordered:

a) the all-inclusive costs for these motions for summary judgment are fixed at $33,000, to be paid equally by the defendants (one third or $11,000 each) within the next 30 days; and

b) a virtual case conference shall be scheduled before me at the earliest possible convenient time – the plaintiff shall immediately contact the Ottawa trial coordinator in order to schedule this one-hour conference.

Mr. Justice Pierre E. Roger

Date: April 28, 2021

COURT FILE NO.: CV-17-74933

DATE: 20210428

ONTARIO

SUPERIOR COURT OF JUSTICE

RE: ST. LAWRENCE PARKS COMMISSION, Plaintiff

-and-

JOHN GORDON CONSTRUCTION INC., TIMOTHY MACDOUGALL, MACDOUGALL HOMES AND CONTRACTING LTD., LES INDUSTRIES HARNOIS INC., and ABC MEGADOME COMPANY, Defendants

BEFORE: Mr. Justice Pierre E. Roger

ENDORSEMENT on Costs

Roger J.

Released: April 28, 2021