Court File and Parties

COURT FILE NO.: CV-15-535091-000

DATE: 20210712

ONTARIO SUPERIOR COURT OF JUSTICE

RE: Leopoldo Gallo and Mark Entesary, Plaintiffs

AND:

1884735 Ontario Inc. o/a Modern Green Design & Build, Defendant

BEFORE: Justice M.D. Sharma

COUNSEL: R. Lee Akazaki, for the Plaintiffs

Iain Peck and Laurie Taylor Graham, for the Defendant

ENDORSEMENT

[1] This is my cost decision following trial. Parties have since submitted costs submissions in writing.

[2] The plaintiffs in this action sought $2 million in damages for demolition and reconstruction costs of a partially constructed home that was left unprotected and was damaged by weather. Following a four-day trial in May of 2021, the plaintiff, Mr. Gallo, was awarded damages in the amount of $535,032.78. Judgment was released on June 7, 2021.

[3] The plaintiffs seek costs on a partial indemnity scale in the amount of $102,663.19, inclusive of disbursements and HST. The defendant acknowledges that this quantum of costs is “generally fair and reasonable in respect of time spent and costs claimed.” However, it argues that costs should be disallowed in its entirety or the quantum sharply reduced due to Mr. Gallo’s failure to comply with his pre-trial discovery obligations, and because he claimed an amount close to four times the amount which he actually recovered.

[4] Pursuant to s. 131(1) of the Courts of Justice Act, the Court has a broad discretion when determining the issue of costs. Rule 57.01(1) sets out the factors to be considered by the Court when fixing costs.

[5] The overall objective of fixing costs is to determine an amount that is fair and reasonable for the unsuccessful party to pay in the particular circumstances, rather than an amount fixed by actual costs incurred by the successful litigant: Boucher v Public Accountants Counsel for Ontario, 2004 CanLII 14579 (ON CA), [2004] OJ. No. 2634 (C.A.). In determining the costs issue, I have considered the factors set out in rule 57.01(1), as well as the principle of proportionality set out in rule 1.04(1.1).

[6] Mr. Gallo was successful in achieving an award, but that award was approximately a quarter of what was claimed (see r. 57.01(1)(a)).

[7] The evidence of the plaintiffs’ contractor, Mr. Ambrosia, had the potential to be very helpful to the Court since he was directly involved in the actual demolition and reconstruction of Mr. Gallo’s home. However, Mr. Ambrosia chose not to produce any documents to support his evidence of what the actual reconstruction costs were, notwithstanding having been served with a summons directing he bring relevant documents. Similarly, Mr. Gallo did not produce relevant documents about quotes he obtained from others with respect to the reconstruction costs. Both Mr. Ambrosio and Mr. Gallo acknowledged they had these relevant documents, and both chose not to produce them.

[8] As such, the evidence of Mr. Ambrosia was of limited assistance to the Court during trial.

[9] Similarly, Mr. Gallo’s refusal to produce evidence of quotes he obtained from other contractors made it impossible to assess whether Mr. Ambrosio’s reconstruction costs were reasonable.

[10] Judgment in this case was based primarily on the evidence of the defendant’s expert with respect to demolition and reconstruction costs, given the absence of particulars in the plaintiffs’ evidence which could have been cured through proper disclosure. Had Mr. Gallo or Mr. Ambrosia produced relevant documents and information, there is reason to surmise that settlement could have been achieved, or that this trial could have been shortened even further (see rule 57.01(1)(e), (f) and (g)).

[11] The defendant also argues this Court should consider findings made by another judge of this Court in which Mr. Gallo was found liable for breach of trust under the provisions of the former Construction Lien Act. In my view, it would be inappropriate to consider this in my cost decision, as this evidence was not before more during this trial nor was it relevant to my decision-making.

[12] For these reasons, and in recognition of all the factors set out in r. 57.01, I believe it is appropriate to reduce the quantum of costs sought by the plaintiffs by $10,000. Accordingly, I order the defendant to pay Mr. Gallo $92,633.19 in costs, inclusive of disbursements and HST, payable forthwith.

Sharma J.

Date: July 12, 2021