Court File and Parties
Court File No.: 20-72248/20-637906 Date: 20220405 Superior Court of Justice - Ontario
Re: Sukhvinder Kang, Applicant And Resham Dhillon, Respondent
Before: Justice L. Sheard
Counsel: Hilary Book and Lia Boritz, counsel for the Applicant Richard P. Startek, counsel for the Respondent
Heard: In Writing
Costs Decision
Overview
[1] This Application was commenced in Toronto by Sukhvinder Kang (the “Kang Application”). The Kang Application sought an order for the sale of property known municipally as 78 John Stiver Crescent, Unionville, Ontario PIN #03044-0274 (LT) PCL 32-1, SEC 65M2512; LT 32, PL 65M2512, S/T LT429274 (the “Stiver Property”). Ms. Kang also sought an order that the net sale proceeds be divided between her and her former spouse, the Respondent, Resham Dhillon, subject to an accounting.
[2] Mr. Dhillon brought a separate Application relating to a different property (the “Dhillon Application”).
[3] Prior to the hearing of the Kang Application, an order was made that all materials filed relating to the Kang Application and the Dhillon Application be filed using the court file number in the Dhillon Application and that the two Applications be heard together. However, as explained in the Reasons for Judgment released February 25, 2022 (the “Judgment”), the hearing proceeded only with respect to the Kang Application and an order was made that the Dhillon Application proceed by way of a trial of the issues.
[4] Ms. Kang had considerable success on the Kang Application: the Stiver Property was ordered to be sold and the net sale proceeds divided, subject to an accounting. As such, Ms. Kang was presumptively entitled to expect to be awarded her costs of this Application. In the Judgment, the parties were told that if they were unable to agree on costs, they could file written costs submissions and costs would be determined by the court.
The parties did not agree on costs and costs submissions were filed. These have been reviewed and considered by the court in the making of this costs decision.
The Law
[5] Section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43, as amended, (the “CJA”) gives the court the discretion to determine by whom and to what extent costs are to be paid.
[6] In civil litigation, costs usually follow the event. That rule should not be departed from except for very good reasons: see Gonawati v. Teitsson, [2002] CarswellOnt 1007 (Ont. C.A.)], and Macfie v. Cater, [1920] O.J. No. 71 (H.C.J.) at para 28): Usanovic v. La Capital Life Ins., 2016 ONSC 5795, at para. 7.
[7] Costs are discretionary and, in the exercise of that discretion, the court is to consider the factors set out in r. 57.01:
57.01 (1) In exercising its discretion under section 131 of the Courts of Justice Act to award costs, the court may consider, in addition to the result in the proceeding and any offer to settle or to contribute made in writing,
(0.a) the principle of indemnity, including, where applicable, the experience of the lawyer for the party entitled to the costs as well as the rates charged and the hours spent by that lawyer;
(0.b) the amount of costs that an unsuccessful party could reasonably expect to pay in relation to the step in the proceeding for which costs are being fixed;
(a) the amount claimed and the amount recovered in the proceeding;
(b) the apportionment of liability;
(c) the complexity of the proceeding;
(d) the importance of the issues;
(e) the conduct of any party that tended to shorten or to lengthen unnecessarily the duration of the proceeding;
(f) whether any step in the proceeding was,
(i) improper, vexatious or unnecessary, or
(ii) taken through negligence, mistake or excessive caution;
(g) a party’s denial of or refusal to admit anything that should have been admitted;
(h) whether it is appropriate to award any costs or more than one set of costs where a party,
(i) commenced separate proceedings for claims that should have been made in one proceeding, or
(ii) in defending a proceeding separated unnecessarily from another party in the same interest or defended by a different lawyer; and
(i) any other matter relevant to the question of costs.
[8] In 394 Lakeshore Oakville Holdings Inc. v. Misek, 2010 ONSC 7238, [2010] O.J. No. 5692 (Ont. S.C.J.), Perell J. reformulated the purposes of the modern costs rules, at para. 10, as follows:
(1) to indemnify successful litigants for the costs of litigation, although not necessarily completely; (2) to facilitate access to justice, including access for impecunious litigants; (3) to discourage frivolous claims and defences; (4) to discourage the sanctioning of inappropriate behaviour by litigants in their conduct of the proceedings; and (5) to encourage settlements.
[9] Overall, the objective is to fix an amount that is fair and reasonable, having regard for, among other things, the expectations of the parties concerning the quantum of costs: Boucher v. Public Accountants Council for the Province of Ontario, 71 O.R. (3d) 291 (C.A.) at paras. 26 and 38.
[10] A costs award should reflect what the court views as a fair and reasonable contribution by the unsuccessful party to the successful party rather than any exact measure of the actual costs to the successful litigant: Zesta Engineering Ltd. v. Cloutier, 2002 CarswellOnt 4020, 118 A.C.W.S. (3d) 341 (C.A.), at para. 4: Fehr et al. v. Sun Life Assurance Company of Canada, 2021 ONSC 8368, at para 83.
Positions of the Parties
[11] Ms. Kang seeks her costs of this Application on a partial indemnity basis in the all-inclusive amount of $24,202.65.
[12] In his Costs Submissions, Mr. Dhillon lists his fees and disbursements and calculates them on a full, substantial and partial indemnity basis. Mr. Dhillon calculates his partial indemnity costs to be $20,708.11, inclusive of disbursements and H.S.T.
[13] Both parties addressed the r. 57 factors. Their submissions are briefly summarized as follows:
(i) The amount claimed and recovered: the parties agree that Ms. Kang was successful in obtaining an order for the sale of the Stiver Property;
(ii) The complexity of the proceeding: Ms. Kang asserts that it was “moderately” complex, involving multiple affidavits, a substantial paper record, and limitations issues.
Mr. Dhillon acknowledges the foregoing but asserts that the law respecting limitation periods is established and that “discoverability” was the main issue to be determined. Mr. Dhillon also states that “at least one-half of the costs incurred” by the parties relates to the Dhillon Application.
(iii) The importance of the issues: the parties agree that the issues were important to them.
(iv) The conduct of any party that tended shorten or lengthen unnecessarily the duration of the proceeding: Ms. Kang asserts that her costs were increased because she had to respond to Mr. Dhillon’s untruthful/inaccurate evidence.
Mr. Dhillon asserts that the parties were courteous and professional and that the proceedings were lengthened because the two applications were intertwined.
(v) A party’s denial of or refusal to admit anything that should have been admitted: Ms. Kang asserts, as set out in the Judgment, that Mr. Dhillon’s own evidence was that he knew that Ms. Kang was a beneficial owner of the Stiver Property and that he had previously agreed to its sale and a division of the sale proceeds.
Mr. Dhillon states: “None” in under this heading in his cost submissions.
(vi) The experience of the party’s lawyer: Ms. Kang’s lawyers, Hilary Book, Lia Boritz and Alycia Young were called to the Bar in 2006, 2016 and 2019 respectively. Their actual and partial indemnity (60%) hourly rates are, respectively, as follows: $525/$315, $350/$210, and $250/$150.
Mr. Dhillon’s lawyer, Richard P. Startek, is shown as having 46 and 49 years of experience in the Cost Outline and Bill of Costs, respectively. Mr. Startek’s actual hourly rate is $450.00 and his partial indemnity rate is $292.50, (65% of his actual rate). Mr. Startek also includes time spent by his law clerk, who has 10 years of experience charged at $97.50 per hour or 65% of the clerk’s full hourly rate of $150.00.
Analysis
[14] I have considered the parties’ submissions and positions.
[15] I find that Ms. Kang accurately states that, in the Judgment, Mr. Dhillon was found by the court to have been inconsistent in his evidence and lacking in credibility.
[16] In the Judgment, Mr. Dhillon was found to have known, and previously acknowledged, that Ms. Kang had a 50% beneficial ownership interest in the Stiver Property. Significantly, Mr. Dhillon acknowledged Ms. Kang’s ownership in the Stiver Property in 2004, when the parties entered into a consent divorce judgment dealing with property division, and more recently in July 2018, when he agreed with Ms. Kang that the Stiver Property be sold, and the sale proceeds split between them, or that Ms. Kang purchase his interest in it.
[17] Mr. Dhillon acknowledges in his Costs Outline, the real issue on the Kang Application was whether Ms. Kang was statute-barred from realizing her ownership interest in the Stiver Property, given the lengthy passage of time. Yet, in the Kang Application, instead of admitting the facts that were ultimately found by the court, Mr. Dhillon denied Ms. Kang’s ownership, denied that the divorce order was made on his instructions and disputed his signature on documents. Mr. Dhillon’s denials and claim that he was the sole owner of the Stiver Property not only necessitated the Kang Application but unnecessarily added to Ms. Kang’s costs by putting Ms. Kang to the expense of finding the evidence to put before the court to establish her ownership interest.
[18] I accept that Mr. Startek has practised law for perhaps three decades longer than has Ms. Book, nonetheless, Ms. Book is an experienced lawyer and I find the time spent and the hourly rates charged by Ms. Book and by the two junior lawyers on the file to be fair and reasonable.
[19] I also note that the partial indemnity costs claimed by Ms. Kang of $24,202.65 are only marginally higher than Mr. Dhillon’s partial indemnity costs of $20,708.11. As the onus was on Ms. Kang as the Applicant, and, as noted above, because Ms. Kang was required to prove facts that ought not to have been denied by Mr. Dhillon, I find that the partial indemnity costs sought by Ms. Kang to be fair and reasonable.
[20] For similar reasons, I find that Mr. Dhillon should reasonably have expected to pay the partial indemnity costs now claimed by Ms. Kang.
[21] I have considered Mr. Dhillon’s assertion that only a portion - perhaps one-half - of the costs claimed relate to the Kang Application and the balance relate to the Dhillon Application. The parties agreed to an order that their materials would be used for the Kang Application and for the Dhillon Application; consequently, the materials prepared and filed and for which costs are claimed in the Kang Application may also be used for the Dhillon Application. However, I do not accept that as a proper basis to reduce the costs claimed by Ms. Kang in the Kang Application, although it may be open to Mr. Dhillon to argue that costs awarded in the Kang Application ought to be taken into account when determining costs in the Dhillon Application.
Disposition
[22] For the reasons set out above, I exercise my discretion to award Ms. Kang her partial indemnity costs of the Kang Application in the all-inclusive amount of $24,202.65.