SUPERIOR COURT OF JUSTICE - ONTARIO
COURT FILE NO.: CV-18-312 (Brantford)
DATE: 2022/06/15
RE: Angela Gerard Huntjens and Johannes Antonius Huntjens, the Plaintiffs
AND:
Justin Obradovic, the Defendant
BEFORE: Justice D.J. Gordon
COUNSEL: Caitlin M. Turner, for the Plaintiffs/Moving Parties Doug LaFramboise, for the Defendant/Responding Party
HEARD: February 25, 2022 (via Zoom)
SUPPLEMENTARY ENDORSEMENT RE: COSTS
In my Reasons for Decision, released June 2, 2022, 2022 ONSC 2629, I invited written submissions from counsel on the issue of costs, such to be exchanged and delivered to my chambers within 30 days.
The plaintiffs were successful in their motion for summary judgment. They are presumptively entitled to a cost award. The only potential issues are of the scale of such award and quantum.
Ms. Turner, counsel for the plaintiffs, seeks a “full indemnity cost award in the amount of $33,903.00. Such does not include prior motions when cost awards were granted. Her written submissions were served on Mr. LaFramboise on May 27, 2022, within the timeframe as directed.
Mr. LaFramboise, counsel for the defendant, has not delivered written submissions. Nor did he request an extension of time. In result, the plaintiffs request may be considered unopposed.
This lawsuit pertained to the sale of certain artwork by the defendant to the plaintiffs. The primary issue on the motion was the price for the artwork. The plaintiffs delivered $130,000.00 to the defendant. I determined the contract amount was $80,000.00, the difference of $50,000.00 being a replacement cheque for one the defendant said had “bounced” but, in fact, had actually been deposited to his account. Judgment was granted for the overpayment.
In their Statement of Claim, the plaintiffs alleged the artwork was also not authentic, seeking a rescission of contract and damages for breach of contract, negligent and fraudulent misrepresentation. These claims were subsequently abandoned. The action continued on the claim for unjust enrichment, being the overpayment referred to above, punitive damages and for a declaration of constructive trust in certain property acquired by the defendant with the use of the overpayment.
The plaintiffs were entirely successful in their motion for summary judgment.
I have reviewed the bill of costs provided by Ms. Turner and conclude the time recorded and hourly rates are reasonable and appropriate. Indeed, it appears such are modest.
Entitlement to a cost award, in large measure, is determined by success. The scale of such award must take into account the factors in Rule 57.01, offers to settle, and the caselaw. The plaintiffs’ success exceeded their offer to settle, raising entitlement to substantial indemnity. Elevated costs, particularly full indemnity as sought, are permitted by Rule 57.01(4)(d).
The focus in full indemnity cost claim is the conduct of the litigator. Here, the plaintiffs and their counsel, conducted themselves appropriately and reasonably and with a view to minimizing expense, as well as court time and resources. The conduct of the defendant did not meet that standard.
A defendant has the right to require the issues in dispute be determined at trial or on a motion for summary judgment. He may choose to deny the allegations in his Statement of Defence and force the plaintiffs to prove their case. However, the defendant must comply with the Rules of Civil Procedure and be truthful in presenting evidence.
In this case, there was a serious concern regarding the conduct of Mr. Obradovic and in the manner his case was presented. In particular:
a) he did not provide an affidavit of documents, nor did he provide full disclosure of all relevant documents, contrary to Rule 30;
b) he caused delay by taking unreasonable and unnecessary steps, including his failed motion to discharge the certificate of pending litigation and in requiring a second cross-examination on affidavits;
c) he ignored the warning delivered by the motion’s judge on his failed motion, particularly as to document disclosure and a resultant adverse inference;
d) his evidence was inconsistent with the evidence as a whole and even with his own Statement of Defence; and
e) he refused to admit the obvious.
- This was essentially a documents case, credibility only arising as Mr. Obradovic refused to acknowledge his own emails and failed to disclose. The evidence presented by the plaintiffs was overwhelming. At para 109 in my Reasons, I concluded:
[109] For the reasons that follow, I find the evidence of Mr. Obradovic is neither credible nor reliable. Rather, it is, with limited exceptions, untruthful and fabricated. From the outset, the litigation strategy has been to deny, delay and obstruct. There are matters that support this conclusion: inconsistency between pleadings and evidence, lack of documentary disclosure and selective memory.
An elevated cost award is appropriate in these circumstances. Should it be full indemnity?
In her submissions, Ms. Turner identifies the relevant factors from the caselaw:
a) where there is a clear finding of reprehensible, scandalous or outrageous conduct (Toronto Start Newspaper Ltd. v. Fraleigh, 2011 ONCA 555 and Young v. Young, 1993 34 (SCC), [1993] SCJ 112 (S.C.C);
b) where the conduct of the party is unreasonable, he acts in bad faith or in an otherwise vexatious manner, increases the complexity of the proceedings, or makes deliberate attempts to frustrate proceedings through fraud of deception (Hunt et al v. TD Securities Inc., 2003 3649 (ON CA), [2003] OJ3245 (Ont. C.A.; and
c) where there is a scurrilous attack on the administration of justice necessitating improper conduct be chastised and to deter others (Baryluk (c.o.b Wyrd Sisters) v. Campbell, 2009 34041 (ON SC), 2009 34041 (ONSC)).
Those factors are present in this case, as noted above and in my Reasons for Decision.
A modest punitive damage award of the $10,000.00 was granted, a penalty for the conduct of Mr. Obradovic prior to the litigation. Such conduct, or litigation strategy, continued throughout this case, putting the plaintiffs to significant expense.
The only possible concern with full indemnity costs might be with respect to the abandoned claim. In his submissions on the motion for summary judgment, Mr. LaFramboise raised a complaint in this regard. In rejecting the argument, at para. 87 in my Reasons, I indicated there may be an impact on costs only.
In her submissions, Ms. Turner says the abandonment occurred before the defendant incurred any cost in defending that part of the claim. By his failure to provide submissions, Mr. LaFramboise has conceded the issue. From my review of the litigation history, the only step taken prior to the abandonment was preparing the Statement of Defence. That pleading was drafted by Mr. Obradovic prior to retaining counsel. In result, I conclude the abandonment of the other claims by the plaintiffs is not a factor.
This lawsuit ought not to have been required. Mr. Obradovic requested, and received, a supplementary payment when he knew there was no entitlement. He attempted to retain the overpayment. It should have been refunded to the plaintiffs immediately.
While a trial was required in Pirbhai v. Singh, 2011 ONSC 1366, the defendants conduct was comparable to that of Mr. Obradovic. The plaintiffs were completely successful. J.W. Quinn, J. in awarding full indemnity costs, at para. 120 said:
Equity requires that the plaintiff not be put to one penny of expense in this pursuit of justice.
Such is the case here.
In result, the plaintiffs are warded full indemnity costs of $33,903.00, payable forthwith by the defendant.
Justice D.J. Gordon