Court File and Parties

Court File No.: CV-19-631398 Date: 2022 03 07

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: MICKI BEN-MARGI, RUTH BEN-MARGI and ALBERTO BEN-MARGI, Plaintiffs - and - ANDREW PAIVA, MALCOLM WHYTE, MARK ANTHONY WHYTE, CERTAS DIRECT INSURANCE COMPANY and ALLSTATE INSURANCE COMPANY OF CANADA, Defendants

BEFORE: Associate Justice Todd Robinson

COUNSEL: D. Green, for the plaintiffs (moving party) P. Regan, for the defendants, Malcolm Whyte and Mark Anthony Whyte F. Kosturik, for the defendant, Andrew Paiva

HEARD: In writing

COSTS ENDORSEMENT

[1] The plaintiffs seek costs of their successful motion to amend their statement of claim in the amount of $4,500 on a partial indemnity basis. Conversely, Malcolm Whyte and Mark Anthony Whyte (together, the “Whyte Defendants”) seek their own costs of the motion in the amount of $1,500 on a partial indemnity basis, submitting that they were more successful than the plaintiffs and their opposition to the motion was necessary to prevent prejudicial allegations akin to fraud against Malcolm Whyte.

[2] Andrew Paiva takes no position on costs as between the plaintiffs and the Whyte Defendants, but submits that his portion of any costs should be no more than $1,000, taking into account Mr. Paiva’s extent of success and the unnecessary costs incurred by the plaintiffs in failing to properly plead their proposed amendments at first instance.

[3] Applicable costs principles are well settled. In determining costs, s. 131 of the Courts of Justice Act, RSO 1990, c. C.43 and Rule 57.01 of the Rules of Civil Procedure, RRO 1990, Reg 194 afford broad discretion to fashion a costs award that the court deems fit and just in the circumstances. Costs are discretionary. Rule 57.01 sets out a non-exhaustive list of factors to be considered by the court in exercising that discretion, which are in addition to considering the result of the proceeding and any written offers to settle. Rule 1.04(1.1), which is also applicable, requires the court to make orders that are proportionate to the importance and complexity of the issues and to the amount involved in the proceeding.

[4] As I have discussed in cases such as Sarta v. Mazo, 2021 ONSC 6557 (cited by the Whyte Defendants), costs awards must reflect what the court views as a fair and reasonable amount that should be paid by the unsuccessful parties rather than any exact measure of the actual costs incurred by the successful party: Davies v. Clarington (Municipality), 2009 ONCA 722 at para. 52. My overall objective in determining costs of the plaintiffs’ motion is to fix an amount that is fair and reasonable in this particular proceeding, having regard to the expectations of the parties concerning the quantum of costs: Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 OR (3d) 291 (CA) at paras. 26.

[5] Each of the plaintiffs, the Whyte Defendants, and Andrew Paiva seek to parse the extent of their success by apportioning the number of proposed amendments on which they each submit they were successful. I do not find such a technical and mathematical approach to costs to be helpful. However, there was divided success, which is a factor in determining costs of this motion.

[6] I do not agree that the Whyte Defendants are entitled to their costs of the motion. Although the plaintiffs were only partially successful, I do not accept that the Whyte Defendants were more successful in their opposition. Although I have denied leave for some of the plaintiffs’ spoliation allegations against Malcolm Whyte, I have granted leave for the most significant one, which was strenuously opposed by the Whyte Defendants.

[7] The Whyte Defendants submit that allegations of spoliation are akin to fraud. That is arguable. Although substantial indemnity costs are not sought by the Whyte Defendants, they support their claim for costs by pointing to Master Dash’s decision in Ascent Incorporated v. Fox 40 International Inc. at para. 5, arguing that the decision supports that substantial indemnity costs are appropriate where fraud-like allegations are inadequately pleaded. However, the circumstances in Ascent are distinguishable from this case. Substantial indemnity costs were awarded in that case, but leave had been denied for the plaintiff’s proposed amendments seeking to add claims based on fraudulent misrepresentations, conspiracy, and actions by individual defendants for their personal gain and without corporate authority. In this case, I have granted leave for the plaintiffs to plead their primary spoliation allegations. Those allegations remain to be proven (or not) at trial. In my view, since I have allowed the spoliation amendments, costs consequences of failing to prove the allegations are more appropriately addressed at trial.

[8] Nevertheless, the Whyte Defendants were still successful in their opposition to some of the proposed spoliation amendments, which should be considered. In the circumstances of this case, though, the points raised by Whyte Defendants on the nature and extent of divided success are factors militating against the plaintiffs’ total costs claim. They are not a basis for a costs award in favour of the Whyte Defendants. In my view, the Whyte Defendants and Andrew Paiva were unsuccessful in their opposition to the most significant aspects of the plaintiffs’ motion. The plaintiffs are thereby entitled to some costs.

[9] Andrew Paiva submits that costs relating to him and the Whyte Defendants must be considered separately. I do not agree. While only Mr. Paiva opposed the punitive damages amendments, that portion of the motion was minimal. Most of the materials and argument focused on the spoliation allegations against Andrew Paiva and the Malcolm Defendants. While the primary allegations of spoliation against each defendant are factually distinct, submissions on spoliation overall involved similar arguments. The distinctions are not such that costs of the motion are readily or properly evaluated separately against the defendants.

[10] The plaintiffs claim aggregate damages of $3.5 million in this action, now also seeking $1 million in aggravated, punitive, and exemplary damages. The issues on the motion were important to the plaintiffs, who feel their ability to prove their claim has been intentionally interfered with by modification and disposition of the two vehicles involved in the accident, namely by Malcolm Whyte replacing the engine in one vehicle and Andrew Paiva selling the other vehicle.

[11] Total partial indemnity costs claimed by the plaintiffs is higher than the costs claims of the defendants as set out in their own costs outlines. The $4,500 claimed by the plaintiffs appears higher than the sum of the calculated partial indemnity costs, HST, and disbursements in the plaintiffs’ costs outline. Adjusting the calculation, the plaintiffs’ costs are not beyond the reasonable expectations of the defendants for a motion of this nature. Also, although lower, the defendants’ costs outlines are fairly comparable taking into account the additional materials prepared by the plaintiffs and disbursement costs.

[12] I agree with the Whyte Defendants that the amendment motion had to be brought for the plaintiffs to add their new allegations. I also agree that the defendants were under no obligation to consent to the amendments. However, they elected to oppose, resulting in increased costs of the motion. Also, while the motion had to be brought, that does not necessarily preclude the plaintiffs from seeking their costs of the motion, even if the motion had been unopposed. The plaintiffs may nevertheless have been entitled to claim costs of the motion in the cause.

[13] I am mindful that, as pointed out by the defendants, the successful amendments are not the originally proposed ones. In the course of the motion, the language of the proposed amendments was twice revised. The accepted amendments were drafted in direct response to the defendants’ responding materials and positions. I agree that the plaintiffs may not have been successful had they continued to seek leave to amend per the original draft language. That is a factor supporting a reduction in recoverable costs.

[14] Considering the foregoing, and having weighed the factors in Rule 57.01 and the extent of divided success, I find the fair and reasonable amount of costs payable to the plaintiffs on this motion to be $1,500 plus HST on a partial indemnity basis, plus the plaintiffs’ disbursements of $645.85, which are reasonable.

[15] Costs ordinarily follow the event and are made payable forthwith, unless the court exercises its discretion to order otherwise: Calibur Tool v. Ecotemp Manufacturing, 2020 ONSC 2511 at para. 42. The motion was necessary for the plaintiffs to plead and pursue spoliation and punitive damages allegations that they intend to advance at trial. In my view, although the plaintiffs are entitled to some costs, I am satisfied that recovery of those costs in the particular circumstances of this case should be tied to success at trial. It is thereby appropriate that costs be payable in the cause, rather than forthwith.

[16] For the foregoing reasons, I fix the fair and reasonable amount of costs payable by the defendants to the plaintiffs for this motion in the total amount of $2,340.85, inclusive of HST and disbursements, payable in the cause by the defendants on a joint and several basis. Order accordingly.

ASSOCIATE JUSTICE TODD ROBINSON DATE: March 7, 2022