COURT FILE NO.: CV-20-82770

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Michela Telatin, Plaintiff

AND:

Firas Shoumali, Defendant

BEFORE: Associate Justice A. Kaufman

COUNSEL: James Anderson, Counsel for the Plaintiff Christine Kucey, Counsel for the Defendant

HEARD: In writing

COSTS ENDORSEMENT

[1] On July 30, 2021, I granted Mr. Shoumali’s motion for summary judgment and dismissed the plaintiff’s action on the basis that her claims were barred by res judicata. The parties were invited to make costs submissions if they could not reach an agreement. I have received and considered their submissions.

[2] Mr. Shoumali seeks a costs award in the amount of $16,192.28 on a substantial indemnity basis. He relies on the fact that he offered to settle the action by accepting a dismissal without costs, that Ms. Telatin alleged that he engaged in dishonest conduct, and that she made allegations that were irrelevant to issues raised on the motion. Approximately 64 hours were spent on the motion between Mr. Shoumali’s counsel and a law clerk.

[3] Ms. Telatin argues that there is no basis for elevated costs, that the parties ought to bear their own costs, or in the alternative, that costs ought to be fixed on a partial indemnity scale. She points out that Rule 49.10 has no application here because the plaintiff did not recover judgment. She adds that the allegations that Mr. Shoumali breached fiduciary duties were not before the Court because the summary judgment motion was grounded in the doctrine of res judicata and not on the claim’s merits. She contends that the evidence about Mr. Shoumali stealing Angelica’s passport and filing a police report were both true and relevant to the exercise of the Court’s discretion against the application of res judicata.

[4] Finally, Ms. Telatin argues that the quantum sought is too high. She points out that her counsel only spent approximately 45 hours on this motion.

[5] The costs of and incidental to a proceeding or a step in a proceeding are in the discretion of the court, and the court may determine by whom and to what extent costs shall be paid (s. 131(1), Courts of Justice Act (Ontario)). In exercising this discretion, the court may consider the factors set out in Rule 57.01(1).

[6] The overriding principles in determining costs are fairness and reasonableness (Boucher v. Public Accountants Council for the Province of Ontario, (2004) 2004 14579 (ON CA), 71 O.R. (3d) 291 (C.A.); Deonath v. Iqbal, 2017 ONSC 3672 at paras. 20-21). The general rule is that costs on a partial indemnity scale should follow the event which should only be departed from for very good reasons such as misconduct of the party, miscarriage in procedure or oppressive or vexatious conduct (1318706 Ontario Ltd.

v. Niagara (Regional Municipality) (2005), 2005 16071 (ON CA), 75 O.R. (3d) 405 (C.A.); 394 Lakeshore Oakville Holdings Inc. v. Misek, 2010 ONSC 7238 at paras. 10, 12-14).

[7] Mr. Shoumali concedes that Rule 49.10 has no application because Ms. Telatin did not recover judgment, but rightly points out that any reasonable offer to settle may be considered as a discretionary basis to award an elevated amount of costs: Schwark v Cutting, 2010 ONCA 299. I accept that the defendant’s offer, had it been accepted, would have achieved the same outcome and saved the parties’ resources. However, I decline to exercise my discretion to award elevated costs based on this offer in this case. While Ms. Telatin was unsuccessful on the motion, I consider that the arguments she made were valid and the recovery of the unreturned sums was very important to her. It was reasonable of her to respond to the motion, especially when Mr. Shoumali’s offer amounted to accepting defeat.

[8] I would also not award elevated costs on the basis that Ms. Telatin made unproven allegations of dishonest conduct or that she raised irrelevant issues. I accept her arguments that the motion did not address her causes of action on the merits and that the context around the taking of the passport related to arguments she made on the motion and did not amount to reprehensible or vexatious conduct.

[9] Mr. Shoumali was entirely successful on the motion and is therefore entitled to his partial indemnity costs.

[10] The motion was of medium complexity and the issues were very important to both parties. It was reasonable for them to spend a considerable amount of time on research. Both parties delivered materials of high quality. The parties cooperated with the scheduling of the motion and behaved reasonably throughout.

[11] I would assess Mr. Shoumali’s partial indemnity costs based on 40 hours of counsel work and 10 hours of work by a law clerk. I consider that this corresponds to the amount Ms. Telatin would reasonably have expected to pay based on her counsel’s own costs outline.

DISPOSITION

[12] Mr. Shoumali’s costs are hereby fixed in the amount of $9,600, inclusive of disbursements and H.S.T., payable forthwith.

Associate Justice A. Kaufman

Date: September 22, 2021