COURT FILE NO.: CV-16-544848

DATE: 20210527

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: JOE NICOLARDI

AND:

CANADIAN TIRE CORPORATION, WALTER SCOTT, DAVE JOSEPH HENDERSON and KENNETH ROY COFFIN

BEFORE: VERMETTE J.

COUNSEL: Hugh Scher, for the Plaintiff

Laura Karabulut and Laura Freitag, for the Defendants

HEARD: May 27, 2021

ENDORSEMENT AS TO COSTS

[1] On May 7, 2021, I issued an endorsement in this action dismissing the Defendants’ motion for partial summary judgment. The parties were not able to agree on costs and have delivered costs submissions and costs outlines.

[2] The Plaintiff’s costs outline is in the amount of $25,735.54, including disbursements and HST, on a partial indemnity basis. His full indemnity costs total $45,770.02. The Defendants’ costs outline is in the total amount of $75,694.31 on a partial indemnity basis, and $124,304.65 on a full indemnity basis.

[3] The Plaintiff’s position is that his success on this motion warrants a higher quantum and scale of costs, and he submits that he “is properly entitled to an award of full indemnity or enhanced substantial indemnity costs.” The Plaintiff argues that the Defendants should be ordered to pay costs to him in the amount of $60,000.00 plus HST and disbursements, which is a higher amount than his full indemnity costs.

[4] The Defendants’ position is that costs should be awarded in the cause or, in the alternative, that a reduced amount of costs be ordered payable to the Plaintiff as a result of the numerous delays by the Plaintiff. They submit that substantial indemnity costs are inappropriate in this case and unsupported on the record.

Entitlement to Costs of the Motion for Summary Judgment

[5] I do not think that there are reasons in this case to depart from the general principle that a successful party is entitled to costs and that the costs of a motion should be fixed by the court and ordered to be paid within 30 days (see Rule 57.03(1) of the Rules of Civil Procedure).

[6] I do not consider that fairness in this case requires that the costs of this motion be connected to the result at trial: York Regional Standard Condominium Corporation No. 1206 v. 520 Steeles Developments Inc., 2018 ONSC 5563 at paras. 38-40. The Defendants decided to proceed with their motion for partial summary judgment, even though they were aware of the warnings in the case law regarding this type of motion. While, as stated below, I do not find any improper conduct on the part of the Defendants, they were unsuccessful on their motion and it would not be fair to deprive the Plaintiff of a cost award given that the Defendants had to be aware of the risks associated with their motion and the Plaintiff expanded time and money to respond to it.

[7] Therefore, I decline to award costs in the cause, as requested by the Defendants.

Scale of Costs

[8] In my view, the appropriate scale of costs for this motion is partial indemnity.

[9] Rule 20.06 of the Rules of Civil Procedure provides that the court may fix and order payment of the costs of a motion for summary judgment by a party on a substantial indemnity basis if: (a) the party acted unreasonably by making or responding to the motion; or (b) the party acted in bad faith for the purpose of delay.

[10] Dealing with the second ground first, it is my view that the Defendants did not act in bad faith for the purpose of delay. I find that the delay in this matter was, in fact, mostly caused by the Plaintiff’s counsel. The Defendants served their motion materials in October 2017. However, the Plaintiff did not deliver his responding motion record until December 10, 2020, more than three years later, after numerous requests and follow-up communications by the Defendants’ counsel. The correspondence between counsel shows that, between October 2017 and December 2020, the Plaintiff’s counsel agreed to or proposed himself a number of deadlines for the delivery of his client’s responding motion record, including: December 8, 2018; the end of January 2019; April 29, 2019; August 7, 2019; December 20, 2019; May 30, 2020; and June 30, 2020. However, he did not meet any of these deadlines. In the end, the Defendants had to schedule a chambers appointment to ensure the progress of their motion and, on November 13, 2020, J. Steele J. ordered that the Plaintiff deliver his responding motion record by December 10, 2020, which was finally done, as stated above. The Plaintiff’s counsel attributes all of this delay to “personal issues”. I do not accept that the entire delay is due to personal issues. It is clear from the correspondence that the Plaintiff’s counsel was working on a number of other cases during at least part of the relevant period of time.

[11] I also find that the Defendants did not act unreasonably by making the motion. As stated by Schreck J. in Himidan v. 2546579 Ontario Inc., 2018 ONSC 6037 at para. 11:

While resort to Rule 20.06 may not require a finding that a party acted “egregiously” or in a “reprehensible manner”, in my view it does require some finding of improper conduct. The heading in the Civil Procedure Rules under which Rule 20.06 is found is entitled “Costs sanctions for improper use of rule.” In my view, Rule 20.06 should be employed only in “exceptional circumstances” where a party has behaved improperly: 1095909 Ontario Inc. v. Westmount-Keele Ltd., 2016 ONSC 3507 (Ont. S.C.J.), at para. 10.

See also McKay v. Park, 2018 ONSC 7346 at para. 49, and Ferndale Enterprises Inc. v. Expertus Technologies Inc., 2019 ONSC 1583 at paras 7-10.

[12] In my May 7, 2021 endorsement, I held that this case was not one of the rare cases where partial summary judgment was appropriate given that the Plaintiff’s claims against the individual Defendants were not readily separable from the balance of the Plaintiff’s case against the Defendant Canadian Tire Corporation. Although I disagreed with the Defendants on this issue, I am not prepared to find that the Defendants have behaved improperly. While the courts have articulated many concerns regarding motions for partial summary judgment, partial summary judgment has been granted in some cases to allow certain defendants to get judgment and “exit” an action that will continue against other defendants. Notwithstanding the fact that I have not ruled on the merits of the individual defendants’ motion for summary judgment and I expect that the record available at trial will be more expansive than the record available at the hearing of the motion, I think that it is fair to say that the Plaintiff’s claims against the individual Defendants are difficult ones, and I am not prepared to say that the Defendants’ motion was improper or had no chance of success.

[13] Thus, this motion is not one where the unsuccessful party should be required to pay costs on a substantial indemnity scale pursuant to Rule 20.06. The Plaintiff is entitled to costs on a partial indemnity scale.

Quantum

[14] Before turning to the issue of quantum on a partial indemnity basis, I wish to comment on the fact that the Plaintiff is seeking costs that exceed the full indemnity amount set out in his costs outline. Based on the principle of indemnity, if costs have not been incurred by a party, the party cannot recover them as part of the costs of the litigation. I see no reason to depart from this principle in this case.

[15] In light of the factors set out in Rule 57.01(1) of the Rules of Civil Procedure, in particular the amount of costs that an unsuccessful party could reasonably expect to pay in relation to this motion, I find that the partial indemnity amount claimed by the Plaintiff in his costs outline, i.e. $25,735.54, is fair and reasonable. Given that the Defendants’ costs outline is approximately three times this amount, I do not think that there can be any argument to the contrary.

Conclusion

[16] Accordingly, the Defendants are ordered to pay costs to the Plaintiff in the amount of $25,735.54 (inclusive of fees, disbursements and HST), payable within 30 days

Vermette J.

Date: May 27, 2021