2021 ONSC 6546
COURT FILE NO.: CV-21-0124-000
DATE: 2021-10-01
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
North Shore Laser Clinic Inc.
Mr. V. Popescu, for the Applicant
Applicant
- and -
Attorney General of Ontario, Thunder Bay District Health Unit, Intervenor
Ms. M. Valentini and Ms. R. Bambers for the Respondent, Attorney General of Ontario
Mr. J. Clark for the Thunder Bay Health Unit
Respondents
HEARD: via Zoom September 27, 2021, at Thunder Bay, Ontario
Madam Justice H.M. Pierce
Reasons on Costs of the Application
Introduction
[1] The responding parties, Attorney General of Ontario and Thunder Bay District Health Unit, claim partial indemnity costs of this application because they were wholly successful.
[2] The applicant argues that no costs should be awarded because the application involved novel issues of broad societal interest. It submits that the applicant is a public interest litigant such that it should not bear the burden of costs.
Background
[3] On March 25, 2021, the Thunder Bay District Health Unit instructed the applicant to stop providing personal care services to the public. On April 8, 2021, the applicant sought an urgent hearing to challenge that direction.
[4] The applicant named the Attorney General as a respondent in the application but omitted to name the Health Unit. The applicant served the Attorney General on April 14, 2021; the Health Unit was served with a courtesy copy on April 7.
[5] The applicant served its record and factum on April 15. The applicant sought declaratory relief to allow it to offer cosmetic personal services under the supervision of a regulated health professional, a registered nurse, during the Covid-19 pandemic. The application required the court to interpret the application of Ontario Regulation 82/20 made under the Reopening Ontario (A Flexible Response to COVID-19) Act, 2020.
[6] A case conference involving all three litigants was conducted remotely on April 20, at which time a consent order was made adding the Health Unit as a party and reserving costs. After the exchange of records and factums, the application was argued remotely on May 26. Reasons dismissing the application were delivered on June 2.
Discussion
[7] The applicant submits that the Health Unit, as an intervenor, is not entitled to costs. I do not agree. The Health Unit is mandated under the Health Protection and Promotion Act, R.S.O. 1990, c. H. 7 to control infectious diseases and diseases of public health significance within the District of Thunder Bay. It was the direction of the Health Unit that gave rise to the dispute between the parties. Thus, the Health Unit should have been named as a party to the proceedings in the first instance.
[8] In North American Financial Group Inc. v. Securities Commission, 2018 ONSC 1282 at para. 13, the Divisional Court stated:
The Intervenors were granted leave to intervene as parties to the appeal pursuant to Rules 13.01 and 13.03 of the Rules of Civil Procedure, not as friends of the court, pursuant to Rule 13.02. This is a critical distinction on the question of their entitlement to costs…. In my view, participation as a party necessarily includes the right to seek costs or to have costs awarded against the Intervenor unless the order granting leave to intervene states otherwise….
[9] Here, the Health Unit was granted leave, on consent, to intervene as a party pursuant to Rule 13.01. It has an interest in the subject matter of the application because it instructed the applicant to close its business, pursuant to Ontario Regulation 82/20. It filed a complete record, with evidence, factum and authorities, and participated in argument as it was entitled to do because of the consent order. Thus, it does not lie in the mouth of the applicant to argue that, despite the court order, the Health Unit is not a party and not entitled to costs.
[10] The applicant also argues that costs should not be awarded because the application raised a novel issue of public importance. It submits that there was no jurisprudence determining whether “registered health professionals” which were not defined in the regulation, could perform cosmetic procedures. As well, the applicant submits that since “health care” and “clinic” were not defined in the regulation, these were also novel issues.
[11] I agree that there is no jurisprudence defining these terms under the pandemic regulatory scheme. However, I accept the submission of the Attorney General that the principles guiding statutory interpretation are settled law: that a textual, contextual, and purposive analysis of the legislation is required. In that respect, the application does not present novel issues.
[12] As well, I conclude that the applicant is not a public interest litigant. The application relates solely to North Shore’s own financial interests. It sought, in the application, to distinguish itself from competing personal service providers that were also required to close in order to reduce the risk of infection during the pandemic.
[13] I therefore conclude that the respondents are entitled to their costs.
[14] Costs are a matter of discretion; the general principles are set out in Rule 57.01. The court must determine what is a fair and reasonable amount, having regard for the reasonable expectations of the parties.
[15] The applicant submits that the Attorney General’s costs are excessive and contain duplicated work. The Attorney General disputes this, submitting that the urgency of the application required three counsel to take instructions from three different ministries with an interest in this litigation and to prepare accordingly. The Attorney General also submits that interpretation of the regulation was of critical importance province-wide.
[16] The applicant should have anticipated that, in the context of a pandemic, the Attorney General would vigorously defend the regulatory scheme established to control economic activity in the face of the pandemic. The legislative framework, involving various revisions of the regulations, was complex, evolving, and the issue was of significant importance to all parties.
[17] To demonstrate the reasonable expectations of the applicant, Mr. Popescu submitted a bill of costs on a partial indemnity scale in the amount of $12,059.39. This bill does not include amending the title of proceedings pursuant to the order made at the case conference or drafting submissions for and attending at the costs hearing. He claimed 5 hours for argument of the application.
[18] Mr. Popescu has been practicing law for 9 years. By experience, he is significantly junior to two leading counsel for the Attorney General. His hourly rate, $210 per hour on a partial indemnity scale, is accordingly more modest.
[19] The Attorney General claims partial indemnity costs of $50,002.35. These costs do not include preparation for or attendance at the costs hearing.
[20] Three counsel represented the Attorney General on the application: Ms. Bambers, with 33 years’ experience, claiming a partial indemnity rate of $435 per hour; Ms. Yankou, with 21 years’ experience, claiming a partial indemnity rate of $395 per hour; and Ms. Valentini, with 3 years’ experience, claiming a partial indemnity rate of $170 per hour.
[21] Ms. Bambers and Ms. Yankou made submissions about different issues on the application. Ms. Valentini presented her client’s costs argument.
[22] Counsel for the Attorney General were assisted by two articling students, Pouya Dabiran-Zohoory and Shawnee Matinnia, for whom an hourly rate of $60 was claimed for almost 13 hours of research, drafting and meeting with counsel.
[23] The Attorney General submits that the quantum of costs sought is in keeping with a costs award of $50,000 made to him by the Divisional Court in a judicial review of the same regulation: see Hudson’s Bay Company ULC v. Ontario (Attorney General), 2020 ONSC 8046.
[24] The Health Unit was also represented by three counsel. It claims partial indemnity costs of $22,017.67.
[25] Much of the work, and all of the argument, was performed by Mr. J. Clark, who has 5 years’ experience and charges partial indemnity rates of $162.50 and $178.75 respectively. He was assisted by Mr. B. Smith who has 18 years’ experience and charges a partial indemnity rate of $175.50 per hour, and Ms. M. Payment, who is in her first year of practice and charges a partial indemnity rate of $130 per hour.
[26] Ms. Payment and the firm’s student-at-law, Jacob Thompson, conducted a watching brief during the hearing, but no costs are claimed for their attendance. Mr. Smith did not appear at either the application or the costs hearing.
[27] Unlike the other parties, Mr. Clark included time for drafting costs submissions in his bill, but not for attendance to argue costs.
[28] As between the two respondents, there was no duplication of argument; however, the Attorney General took a lead role in outlining the legislative framework and presenting argument on statutory interpretation.
Conclusion
[29] The applicant sought an urgent hearing in this case. Consequently, it is not surprising that there should be some duplication of work among counsel for the Attorney General. However, I have concluded that while having junior counsel conduct a watching brief during the application may have been advantageous for her education, the Attorney General cannot look to the applicant to cover these costs.
[30] Similarly, having senior counsel sit in on the costs hearing when not making submissions may have administrative advantages; nevertheless, the cost of that decision should not fall to the applicant.
[31] With respect to the Attorney General’s argument that he should be entitled to the same costs awarded by the Divisional Court, there is not enough detail in the endorsement to allow me to conclude that the cases are comparable.
[32] The bill of costs filed by the Health Unit shows some small duplication for a third lawyer but is generally reasonable given what was at issue and the urgency to respond to the application.
[33] In this case, the cost claims of both parties should be considered in light of the global costs award, such that a party can access the courts to have disputes adjudicated. The right to access the courts should, however, be balanced against the burden on the taxpayer to fund such litigation.
[34] The applicant shall pay to the Attorney General of Ontario costs in the sum of $35,000 inclusive of disbursements. In addition, the applicant shall pay the to the Thunder Bay District Health Unit costs in the amount of $20,000 inclusive of disbursements and tax.
“original signed by”
The Hon. Madam Justice H.M. Pierce
Released: October 1, 2021
2021 ONSC 6546
COURT FILE NO.: CV-21-0124-000
DATE: 2021-10-01
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
North Shore Laser Clinic Inc.
Applicant
- and -
Attorney General of Ontario, Thunder Bay District Health Unit, Intervenor
Respondents
REASONS ON COSTS OF THE APPLICATION
Pierce J.
Released: October 1, 2021
/lvp