Court File and Parties

COURT FILE NO.: CV-19-00617420 DATE: 20220304 ONTARIO SUPERIOR COURT OF JUSTICE

RE: Web Objective Inc., Plaintiff AND: Christopher Stramacchia and ISee Automation Inc., Defendants

BEFORE: Justice Mohan D. Sharma

COUNSEL: Christopher MacLeod and Joseph Figliomeni, for the Plaintiff Jeffrey W. Nanson, for the Defendants

HEARD: March 4, 2022

Endorsement

[1] I granted judgment to the plaintiff on February 1, 2022 following a summary trial heard on December 16 and 17, 2021: see Web Objective Inc. v. Stramacchia, 2022 ONSC 727. Parties were directed to deliver cost submissions, which have now been received and reviewed.

[2] I granted judgment against the corporate defendant, iSee Automation Inc., in the amount of $50,000, plus accrued interest owing to the plaintiff under a debenture. I also granted judgment against the personal defendant, Christopher Stramacchia, in the amount of $50,000, plus interest under a personal guarantee.

[3] The most contested issue at trial was whether Mr. Stramacchia signed a personal guarantee. A handwriting expert was called to give evidence. I concluded that Mr. Stramacchia’s signature was forged on the personal guarantee, however, I also found that he either authorized or condoned the forgery. I cited other evidence which established, on a balance of probabilities, that he had personally guaranteed payment to the plaintiff.

[4] The plaintiff seeks full indemnity costs of $62,269.12, or in the alternative, its substantial indemnity costs of $50,259.25. It relies on a clause in the personal guarantee which makes Mr. Stramacchia liable for all expenses, including legal fees, incurred by the plaintiff in the enforcement of any rights under the guarantee.

[5] The defendants argue that these costs are excessive, citing the fact that the plaintiff engaged two lawyers for parts of this litigation. They also argue that of the plaintiffs’ total legal expenses, $1,600 should be deducted based on a prior order made by Justice Akbarali on March 10, 2021 to account for costs thrown away from a prior attendance.

[6] In reply, the plaintiff argues that it made an Offer to Settle on July 17, 2019 in the amount of $60,500, which offer was better than the judgment after interest is calculated. This offer was open for acceptance up until trial. It further states that junior counsel was directly involved in supporting this case, through witness preparation and navigating documents on CaseLines.

[7] 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. Even when there is a contractual provision entitling a party to fully recover costs, the court must be satisfied that costs incurred were reasonable.

[8] 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] OJ. No. 2634 (C.A.). In determining costs, I must consider the factors set out in rule 57.01(1), as well as the principle of proportionality set out in rule 1.04(1.1).

[9] For the reasons advanced by the plaintiff, costs on the higher end of the scale are warranted. The costs incurred by the plaintiff were not unreasonable. In addition, text messages showed Mr. Stramacchia acknowledged having personally guaranteed the amounts due under the loan. This fact, had it been admitted by him, would have shortened if not eliminated a need for this trial.

[10] Having regard to the above factors and after considering the parties’ submissions, I order the defendants to pay the plaintiff’s costs of this action fixed in the amount of $55,000, inclusive of HST and disbursements.

Justice Mohan D. Sharma Date: March 4, 2022