Notsch-Kupcho v. NY Brand Studio Inc, 2021 ONSC 4699

1The plaintiffs succeeded in the action and are presumptively entitled to their costs. The defendant challenges only the quantum.

2The plaintiffs made an offer to settle in February. It contained no real compromise on principal, a waiver of prejudgment interest, and asked for fixed costs of $21,000 plus HST.

3The compromise offered on interest is immaterial and would not provide a reasonable person any incentive to accept the offer as anything other than a complete capitulation.

4I cannot tell if the cost offer is a compromise. To do that, I would have to determine how much costs the plaintiffs would have been entitled to as at the date of the offer and compare that to the $21,000 plus HST offered. The material filed does not allow for that calculation. Moreover, I would not accept it anyway because there is no way for the offeree to know at any given time whether an offer for fixed costs represents a compromise. The offeree would need to review the offeror’s dockets and a have prescience as to how a court may later assess or fix costs based on the dockets and discretionary factors.

5I leave for another case an offer for costs that is so low compared to the activity in the file that any reasonable lawyer would have understood that it had to be a significant compromise. That is not this case.

6In all therefore, I am not satisfied that the plaintiffs have achieved a result that is meaningfully or materially better than the amount contained in the offer to settle. Put another way, in order for an offer to settle to carry the positive cost consequence available under Rule 49, it has to contain a compromise. If it just says “Pay me what I will win” (or an amount immaterially less) the plaintiff then is entitled to the regular partial indemnity for costs available to successful litigants generally.

7The hourly rates and hours booked by the plaintiffs’ counsel are within a reasonable range. They are less than the defendant’s costs. Accordingly, I fix the costs of the action and order the defendant to pay the plaintiffs $54,000 all-inclusive.

FL Myers J