COURT FILE NO.: CV-19-82023
DATE: 20210809
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: THE BANK OF NOVA SCOTIA, Plaintiff/Moving Party AND: HALA JARADA and ANTRANIK KECHICHIAN, also known as TONY KECHICHIAN, Defendants
- and -
COURT FILE NO.: CV-19-82025
RE: THE BANK OF NOVA SCOTIA, Plaintiff/Moving Party AND: HALA JARADA, Defendant AND: ANTRANIK KECHICHIAN, Third Party
BEFORE: Mew J.
COUNSEL: Ian Klaiman, for the Plaintiff Bryce Dillon, for the Defendant, Hala Jarada Antranik Kechichian, unrepresented
HEARD: in writing
COSTS ENDORSEMENT
[1] This costs endorsement deals with two summary judgment motions in which the Bank of Nova Scotia sought to enforce personal guarantees given by the defendants in respect of the obligations of two numbered companies.
[2] For reasons contained in my decisions of 19 May 2021, and reported at 2021 ONSC 3620 and 2021 ONSC 3621, I granted the Bank summary judgment in favour of Antranik Kechichian (Court File No. CV-19-82023 only) and dismissed the Bank’s motion for summary judgment against Hala Jarada, holding that the dispute between the Bank and Dr. Jarada raises triable issues.
[3] Dr. Jarada cross-claimed against Mr. Kechichian in Court File No. CV-19-82023 (Ottawa) and brought third party proceedings in Court File No. CV-19-82025, seeking indemnification to the extent of her ultimate liability, if any, to the Bank. I granted her summary judgment on those claims, subject to proof of damages in due course when the extent of her liability, if any, to the Bank, and the costs to be incurred by her in her continued defence of the Bank’s claims against her, are known.
[4] I was presumptively of the view that the Bank should have its costs of the summary judgment motion and of the action as against Mr. Kechichian, that Dr. Jarada should have her costs of defending the Bank’s summary judgment motions against her, and that Dr. Jarada should recover the costs of her summary judgment motion against Dr. Kechichian, including indemnification for the costs incurred by her to date defending the Bank’s claim. I reserved to the judge dealing with the quantum of Mr. Kechichian’s obligation to Dr. Jarada the extent to which, if at all, he might be required to indemnify her for further costs incurred by her in defending the Bank’s actions going forward.
[5] The parties were invited to make written submissions if they were unable to agree on costs.
[6] Counsel for Dr. Jarada advised that after the hearing, Dr. Jarada and Scotiabank reached a settlement, which is currently being finalised, and that, accordingly, Dr. Jarada does not seek costs against the bank. Dr. Jarada intends, in due course, to seek a return date to quantify her damages with respect to her judgments against Mr. Kechichian. In the meantime, the Bank seeks its costs of the action (including the summary judgment motion) against Mr. Kechichian and Dr. Jarada seeks costs with respect to her defence of the Scotiabank claims to date and her costs of her summary judgment motion against Mr. Kechichian in the amount of $54,131.97 on a substantial indemnity scale.
Costs Payable by Mr. Kechichian to the Bank
[7] The Bank seeks costs against Mr. Kechichian on a substantial indemnity scale, which it quantifies in the all-inclusive amount of $23,459.52.
[8] No responding submissions have been received from Mr. Kechichian.
[9] The Bank argues that it is entitled to costs on a substantial indemnity scale: (i) pursuant to the guarantees executed by Mr. Kechichian, and in any event, (ii) due to his improper, vexatious, and unnecessary conduct, all of which had the effect of escalating costs.
[10] The guarantees executed by Mr. Kechichian provided that:
he guarantor must also pay all of the costs and expenses we incur to get the money the customer owes to us, including any costs and expenses of collecting from the guarantor including without limitation legal fees on a solicitor and his/her own client basis.
[11] I refer to my costs endorsement in a companion motion, bearing Court File No. CV-17-72986 (2021 ONSC 5381) for a statement of the general principles applicable when parties have made an agreement relating to the scale of costs to be paid.
[12] Suffice it to say, that the court retains a discretion with respect to the amount and scale of costs to be awarded, notwithstanding what the parties may have agreed to.
[13] In the present case, I agree with the Bank that here is no good reason to depart from the general principle that the Bank is entitled to its costs on a substantial indemnity scale from Kechichian, pursuant to his guarantees.
[14] While the Bank also relies on Mr. Kechichian’s conduct as an aggravating factor that would support a substantial indemnity award, I do not need to dwell on that submission given my agreement that costs should be on a substantial indemnity scale, save that it resulted in more time having to be spent by the Bank’s lawyers than would usually be required in a case such as this.
[15] Considering the amount at stake (i.e. the principal sum of over $186,000.00, plus interest), the importance of the motion, the time spent by counsel, and the reasonableness of the rates charged, I am satisfied that the Bank’s quantification of costs is appropriate.
[16] Accordingly, Mr. Kechichian shall pay the Bank’s costs of the action (including the summary judgment motion) on a substantial indemnity scale, fixed in the all-inclusive sum of $23,459.52.
Pre-Judgment Interest
[17] The Bank has provided a pre-judgment interest calculation. Contractual pre-judgment interest on the principal sum awarded of $136,737.25 is $162,942.29; interest on the principal sum awarded of $50,534.18 is $59,205.36.
Costs Payable by Mr. Kechichian to Dr. Jarada
[18] Turning to Dr. Jarada’s claim for costs, it is now well established that the court at the end of a hearing fixes costs unless it is satisfied that it has before it an exceptional case that warrants referring the issue of costs to an assessment officer: Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291, 2004 CanLII 14579 (ON CA), at para. 15. Judges should be able to fix costs without having to scrutinise in detail the dockets or documents evidencing the history of the litigation. For that reason, it has become a common practice for judges and masters to limit the length of written submissions on costs to three or four pages and to require, in addition, only the production of a bill of costs and evidence of written offers of settlement.
[19] Dr. Jarada’s written submission, which modestly exceeded the four-page limit that I had set, was accompanied by a 210-page compendium.
[20] The provision by counsel for Dr. Jarada of 210 page compendium, much of it containing copies of pleadings and orders as well as correspondence between the parties and transcripts, was submitted, no doubt with the best of intentions, to demonstrate the extent of Mr. Kechichian’s “unfounded arguments that over complicated the proceedings” and what is said to have been his “reprehensible, scandalous or outrageous conduct”.
[21] An unfortunate side effect of the transition to electronic filing of most court-related documents has been a significant increase in the volume of materials delivered by counsel for even the most routine of matters. It is as if counsel no long feel the need to be selective about what they file, given the ease of stitching together PDF documents which, if printed, would be responsible for the waste of a lot of paper and ink, not to mention the raising of judicial ire.
[22] In many cases, the demands on judicial time and resources are such that is unreasonable – and disproportionate – for parties to expect judges to wade through significant volumes of material submitted in relation to fixing of costs of applications and interlocutory motions.
[23] I would add that judges are now encouraged to read electronic documents on screens, rather than print them off. It is an open question as to whether human beings are as good at reading on screens as they are with paper. Certainly, anecdotal evidence is that many judges and lawyers find visual perception, attention and comprehension, particularly for prolonged periods of time, more challenging in the virtual environment.
[24] All of which to say is that, for the purposes of costs submissions, a document dump, however well intentioned, is unlikely to assist the court. In the present case, the written submissions of counsel more than adequately communicated Dr. Jarada’s position. The need to support those submissions with 210 pages of compendium was not required. A more selective collation of important documents (or extracts from them) would have sufficed.
[25] In support of her claim for substantial indemnity costs against Mr. Kechichian, Dr. Jarada recites arguments which she raised her defence to the Bank’s claims against her, namely that she was, essentially, a victim, who was duped into signing documents that she did not understand, which turned out to be personal guarantees. She also claimed that Mr. Kechichian subsequently agreed to fully indemnify her for any liability which she might incur as a result of the various documents that he had asked her to sign.
[26] I accepted Dr. Jarada’s evidence of Mr. Kechichian’s promise to indemnify her, which was uncontradicted. This formed the basis of my granting of summary judgment on her crossclaim and third-party claim.
[27] I did not, however, make a determination on the extent to which Dr. Jarada’s guarantees were obtained as a result of undue influence or other questionable conduct on the part of Mr. Kechichian (Mr. Kechichian asserted during his cross-examination that Dr. Jarada knew what she was signing). I found that there were triable issues in that regard. Accordingly, it would have remained to be seen whether Dr. Jarada was used by Mr. Kechichian, or the extent to which she was misled about what she was signing and, hence, about the nature and extent of the liabilities that she had assumed.
[28] In her costs submission, Dr. Jarada also argues that Mr. Kechichian “has been a plague on the court system for many years and has unnecessarily caused dozens of parties to spend hundreds of thousands of dollars and waste years in litigation”. That may or may not be. However, Dr. Jarada’s involvement in this litigation arising principally from the fact that her signatures, which she was unable to disavow, appeared on the guarantees which were provided to the Bank.
[29] The litigation that ensued when those guarantees were not honoured by the guarantors was entirely predictable.
[30] While Dr. Jarada is undoubtedly entitled to her costs of the crossclaim and third party claim against Mr. Kechichian, and has every reason to feel aggrieved, the circumstances do not, in my view, warrant awarding her costs of Mr. Kechichian on a substantial indemnity basis.
[31] I largely accept the arguments put forward by Dr. Jarada with respect to the Rule 57.01 factors that apply. Her costs outline claims partial indemnity costs in the amount of $36,668.67, inclusive of H.S.T. and disbursements. However, the outline does not delineate between the costs incurred in relation to the defence of the main actions, defence of the summary judgment motions, and prosecution of the crossclaims. The narrative in the outline suggests that it relates to all aspects of the case.
[32] At this juncture, the only costs Dr. Jarada should be recovering against Mr. Kechichian are those pertaining to the claims for indemnification. Her costs of defending the main actions and the Bank’s summary judgment motions arise, at first instance, between her and the Bank. I have not been asked to fix those costs because Dr. Jarada and the Bank have settled with each other.
[33] There is, as a result, inevitably a measure of guesswork on my part as to what costs can reasonably be attributed to the indemnity claims.
[34] I have concluded that an appropriate amount would be $7,500 all inclusive. Mr. Kechichian is ordered to pay Dr. Jarada that sum forthwith.
[35] As indicated in my decision on the summary judgment motion, the costs associated with the quantification of her claims for indemnity against Mr. Kechichian, as well as her possible claim for costs relating to the defence of the Bank’s claim against her going forward, will fall to be addressed by the judge hearing those claims.
Mew J.
Date: 09 August 2021