COURT FILE NO.: CV-17-72439-R000
DATE: November 29, 2021
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Sima Abdollahpour Applicant
-and-
Hamid Abdollahpour and Shakiba Banifatemi Respondents
BEFORE: Associate Justice Fortier
COUNSEL: John Summers, for the Applicant
Diane Aoun, for the Respondent, Hamid Abdollahpour
Kevin Kavanagh, for the Respondent, Shakiba Banifatemi
ENDORSEMENT ON COSTS
[1] This endorsement on costs relates to the Reference directed to the Master pursuant to the order of Parfett J. dated August 31, 2017.
[2] The Reference in this matter was heard on August 14, 2019. My initial decision on the Reference (“report”) was released on November 18, 2019 and an amended decision on the Reference (“updated report”) was released on September 18, 2020. A motion brought by the Respondent Hamid Abdollahpour, for an order opposing confirmation of the updated report, was dismissed by Gomery J. on September 21, 2021.
[3] Counsel for the Respondent Abdollahpour asked that I defer my decision on costs of the Reference pending the disposition of the motion opposing the confirmation of my updated report. As the Respondent Abdollahpour’s motion has now been disposed of, the matter of costs of the Reference is before me for determination.
Background
[4] The parties in this matter are family members who were involved in a dispute over the sale of a property in the City of Ottawa (“the property”). The Applicant, Sima Abdollahpour, and the Respondent, Hamid Abdollahpour, were joint owners of the property. In March 2012, a 50% interest in the property was transferred to the Respondent, Shakiba Banifatemi, as a tenant in common, pursuant to a Deed of Gift upon the Respondent Banifatemi’s marriage to the Applicant and the Respondent Abdollahpour’s son. The Applicant and the Respondent Abdollahpour remained joint tenants of the remaining 50%.
[5] In April 2017, the Applicant brought an Application for partition and sale of the property and for reimbursement for a portion of the payments she made towards the mortgage, property taxes, insurance, and other expenses, since the property had been in the names of the parties.
[6] The property was sold in November 2017 and the matter was referred to the Master to determine all remaining issues. These included the distribution of the net proceeds of sale, determination of any costs incurred by any of the parties in relation to the maintenance or sale of the property, occupation rent, and income received by any of the parties from rental of the property.
[7] Several interim disbursements were paid on agreement of the parties, and the remaining amount held in trust was $219,650.00.
[8] The Applicant was seeking reimbursement in the amount of $174,650.29 from the proceeds of the sale, for the expenses related to the property that she had paid from March 2012 until November 2017, as well as expenses related to the earlier application to sever the property. The Applicant was seeking $128,949.00 from the Respondent Banifatemi and $45,701.00 from the Respondent Abdollahpour.
[9] The Respondent Banifatemi took the position that she did not have to contribute to the expenses and in the alternative, if it was found that she should contribute to the expenses, that there should be an allowance for occupation rent during the period that the Applicant occupied the property.
[10] The Respondent Abdollahpour’s position was similar to that of the Respondent Banifatemi, but for different reasons.
[11] The Respondent Banifatemi was completely successful on the Reference. I found that Ms. Banifatemi was not expected to contribute to the expenses of the property nor was she responsible for the expenses related to the application to sever the property.
[12] There was divided success between the Applicant and the Respondent Abdollahpour. Although I found that the Respondent Abdollahpour was equally responsible to cover the cost of the monthly expenses on the property, I accepted his position that occupation rent would offset some of the expenses. Having said that, in my view the success is not equally divided because the Respondent Abdollahpour was ultimately required to pay expenses greater than his position on the Reference and similar to the amount sought by the Applicant against him.
Position of the Parties
[13] The Respondent Banifatemi served an offer to settle on August 7, 2019. The offer was not accepted and remained open for acceptance to the commencement of the hearing.
[14] The Respondent Banifatemi argues that she is entitled at minimum to her costs on a partial indemnity scale in the sum of $8,238.40, inclusive of disbursements and HST. Ms. Banifatemi submits however, that she should be awarded costs on a substantial indemnity basis in the sum of $12,021.64 inclusive of disbursements and HST, because of the Applicant’s unreasonable conduct of the action and taking into consideration her offer to settle.
[15] The Applicant acknowledges that the Respondent Banifatemi was successful and is entitled to an award of costs. It is her position however, that the costs awarded should be on a partial indemnity scale arguing that the offer to settle, as drafted, does not meet the provisions of Rule 49.10 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. Moreover, the Applicant submits that both she and the Respondent Abdollahpour should be equally responsible for the costs payable to the Respondent Banifatemi on the basis that the Court found the Respondent Abdollahpour responsible for half of the expenses for the property, and that the same logic should therefore follow as related to costs.
[16] The Applicant is seeking costs against the Respondent Abdollahpour on a partial indemnity basis fixed in the amount of $6,000.00, arguing that she was successful as against the Respondent Abdollahpour with regards to him paying his share of the expenses on the home.
[17] The Respondent Abdollahpour denies that he is responsible to pay one half of the costs payable to the Respondent Banifatemi and is seeking costs against the Applicant in the sum of $7,733.86 on a substantial indemnity basis. He submits that although the Court allowed the Applicant to recover some of her expenses related to the property, he was successful as against the Applicant in claiming occupation rent. The Respondent Abdollahpour also points to the Applicant’s alleged unreasonable position from the beginning of the litigation.
The Law and Analysis
[18] Section 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43 provides that costs are in the discretion of the court. In addition, the case law sets out that a successful party is presumed to be entitled to costs in an amount that is reasonable, having regard to the factors set out in Rule 57.01 of the Rules of Civil Procedure. These factors include the principle of indemnity, the reasonable expectations of the parties, the apportionment of liability, and the conduct of any party that tended to lengthen unnecessarily the duration of the proceeding, among others.
[19] It is well established that costs should be awarded on a partial indemnity basis. Costs on a substantial indemnity basis are generally awarded only where there has been reprehensible, scandalous or outrageous conduct on the part of a party (Laczko v. Alexander, 2012 ONCA 872 at para.2) or where the cost consequences of offers to settle pursuant to Rule 49 apply.
[20] In my view, the Respondent Banifatemi’s success on the Reference was greater than her offer to settle. In this case however, the offer to settle does entitle her to substantial indemnity costs from the date of the offer.
[21] The cost consequences of offers to settle are set out in Rule 49 of the Rules of Civil Procedure. Pursuant to Subrule 49.10(1), where a plaintiff [emphasis added] obtains a judgment as favorable as or more favorable than the terms of the offer, and meets other procedural requirements, the plaintiff is entitled to substantial indemnity costs from the date of the offer unless a court orders otherwise. There is, however, no corresponding provision in Rule 49 entitling a defendant (or respondent) to substantial indemnity costs where it makes an offer to settle that is as favorable or more favorable than the amount ultimately awarded. (See St. Elizabeth Home Society v. Hamilton (City), 2010 ONCA 479 at paras.88-91).
[22] Although both Respondents argue that the Applicant’s conduct in this matter from the beginning has not been that of a reasonable litigant, there is no evidence before me of reprehensible scandalous or outrageous conduct on the part of the Applicant, that would justify a departure from the usual scale. I therefore decline to consider awarding costs on a substantial indemnity basis.
[23] In exercising my discretion with respect to costs, I am mindful that the fixing of costs is not simply a mechanical exercise; the objective is to fix an amount that is fair and reasonable and proportional in all of the circumstances (Boucher v. Public Accountants Council (Ontario), (2004) 2004 14579 (ON CA), 71 O.R. (3d) 291 (C.A.), at para.26).
[24] I have reviewed the Bill of Costs submitted by counsel for the Respondent Banifatemi and I find that her costs on a partial indemnity scale in the sum of $8,238.40, inclusive of disbursements and HST to be fair and reasonable.
[25] In my view, there is no reason why the Respondent Abdollahpour should be responsible for half of the Applicant’s costs owing to the Respondent Banifatemi. My finding related to the division of the expenses on the property bears no relation to the costs of the proceeding. In my view, the Applicant alone is responsible to pay for the Respondent Banifatemi’s costs.
[26] I decline to grant costs to the Respondent Abdollahpour. As indicated in paragraph 12 above, both the Applicant and Respondent Abdollahpour achieved a measure of success against the other, with the balance tipping in favour of the Applicant. It is noteworthy that the Respondent Abdollahpour did not submit a factum for the Reference. Rather, his success on the issue of occupation rent was based on the Respondent Banifatemi’s submissions and factum.
[27] Although I find that the Applicant is entitled to costs against the Respondent Abdollahpour, in my view, the costs should be reduced because of the divided success. Accordingly, in exercising my discretion with respect to costs, I find that costs to the Applicant in the sum of $2,000.00 inclusive of disbursements and HST would be fair, reasonable, and proportional, in the circumstances.
ORDER
[28] The Applicant Sima Abdollahpour shall pay to the Respondent Shakiba Banifatemi costs in the sum of $8,238.40 inclusive of disbursements and HST within 30 days from the date of this endorsement.
[29] The Respondent Hamid Abdollahpour shall pay to the Applicant Sima Abdollahpour costs in the sum of $2,000.00 inclusive of disbursements and HST within 30 from the date of this endorsement.
Associate Justice Fortier
DATE: November 29, 2021
COURT FILE NO.: CV-17-72439-R
DATE: November 29, 2021
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: ABDOLLAHPOUR v. ABDOLLAHPOUR et al
BEFORE: Associate Justice Fortier
COUNSEL: John Summers, for the Applicant, Sima Abdollahpour
Diane Aoun, for the Respondent, Hamid Abdollahpour
Kevin Kavanagh, for the Respondent, Shakiba Sadat Banifatemi
ENDORSEMENT ON COSTS
Associate Justice M. Fortier
DATE: November 29, 2021