Court File and Parties
COURT FILE NO.: 16-70049
DATE: 20220826
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: DALY SQUARE INC., Plaintiff
and
1786097 ONTARIO INC. and CAMILLE MIKHAEL, Defendants
BEFORE: Justice H.J. Williams
COUNSEL: Jonathan Richardson and Victoria Boddy, Counsel, for the Plaintiff
Pierre Champagne and Ginger Warner, Counsel for the Defendants
HEARD: In writing
costs ENDORSEMENT
[1] The parties have asked me to fix costs of a summary judgment motion I heard and decided in 2018.
[2] In an endorsement dated December 14, 2018, after reviewing the parties’ bills of costs and considering their written submissions, I concluded that I was not able to make an informed decision about costs at that time. My decision on the motion had turned in part on the plaintiff’s failure to produce certain documents and in particular, some monitoring data requested by the defendants. I reserved on costs until the data had been produced and counsel could make submissions about whether the failure to produce the data earlier had an impact on the motion.
[3] The parties have now settled the action. They have filed a joint costs brief. They have agreed that no further submissions will be made unless I request them. They have informed me that the monitoring data were produced on November 28, 2018. Neither said anything further about the data. I infer that the data turned out to be a non-issue, at least in relation to costs.
[4] The defendants were almost entirely successful on the motion. The parties agree the defendants should be awarded costs on a partial indemnity basis. The issue is the amount. The defendants ask for all-inclusive costs of $32,014.17, which includes partial indemnity fees of $27,404.70, HST on the fees, disbursements and HST on the disbursements. The disbursements are slightly in excess of $1,000.
[5] The defendants’ all-inclusive full indemnity fees were $45,674.50.
[6] The plaintiff’s all-inclusive full indemnity fees were only $17,022.
[7] The plaintiff says $15,000 all-inclusive would be an appropriate partial indemnity award in this case.
[8] Section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C. 43, provides that the costs of and incidental to a proceeding or a step in a proceeding are in the discretion of the court. Although discretionary, a court must fix costs on a principled basis. (Davies v. Clarington, 2009 ONCA 722, at para. 40.) Rule 57.01(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, sets out the factors the court may consider, in addition to the result in the proceeding and any offer to settle or to contribute made in writing, in exercising its discretion under section 131 of the Courts of Justice Act to award costs. The Court of Appeal has made it clear that the fixing of costs does not begin and end with a calculation of hours times rates. It says the objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay rather than an amount fixed by the actual costs incurred by the successful litigant. (Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 CanLII 14579 (ON CA), 71 O.R. (3d) 291 (C.A.), at para. 26.)
[9] Turning first to the applicable Rule 57.01(1) factors, the defendants were successful on all but one issue. I consider the motion to have been moderately complex and to have been very important to the defendants, who risked judgment against them and the loss of a substantial counterclaim.
[10] The defendants argued that the plaintiff unnecessarily lengthened the proceeding by failing to include in its notice of motion a request to dismiss the counterclaim. I do not accept this argument. The plaintiff’s intention to dismiss the counterclaim was made clear in the plaintiff’s factum. As I had noted in my February 2, 2018 endorsement, the defendants were obviously aware of the position the plaintiff was taking because the defendants had devoted 21 of the 97 paragraphs in their factum to the limitation period issue. The defendants had argued that the dismissal of the counterclaim was not before me but did not request an adjournment. I adjourned the motion so that plaintiff could amend its notice of motion and to permit the defendants to file additional material if required. Counsel could have and should have resolved this issue prior to the initial hearing. I consider both parties to have been responsible for the delay.
[11] The plaintiff takes issue not so much with the hourly rates charged by the defendants’ counsel as with the number of hours they spent. The defendants justify the hours on the basis that their written materials were more comprehensive and that their additional length was necessary, given the issues. The plaintiff says the defendants’ materials were repetitive and notes that I relied on only a small fraction of the 30 authorities the defendants referenced in their factum. The defendants say the time they spent was commensurate with the amount at issue and the importance and complexity of the matter.
[12] I am struck by the discrepancy between the fees of the two camps. The plaintiff’s argument that the fees sought by the defendants were not within its reasonable contemplation is supported by the plaintiff’s bill of costs, which reflects fees of one third of the amount requested by the defendants. A comparison based on hours is more appropriate than one based on dollars in this case, however, because the plaintiff does not take issue with the hourly rate charged by the defendants’ more senior counsel and has only a minor quibble with the rate of the more junior counsel. According to the plaintiff’s calculations, the plaintiff spent 88 hours on the motion, 55.8 of which were docketed by junior counsel, staff or students. The defendants spent 181.6 hours, all docketed by counsel. The defendants, therefore, spent about twice as much time as the plaintiff while charging three times as much.
[13] The defendants were successful on the motion. Given what was at stake for them, it was not unreasonable for them to have invested more time than the plaintiff, and that they might do so should have been reasonably contemplated by the plaintiff. That said, I must agree with the plaintiff that there may have been a degree of overkill on the part of the defendants that the plaintiff would not reasonably have anticipated.
[14] For these reasons, I consider $27,500, inclusive of disbursements and HST to be a fair and reasonable amount for the plaintiff to pay in this case.
Date: August 26, 2022
COURT FILE NO.: 16-70049
DATE: 20220826
ONTARIO
SUPERIOR COURT OF JUSTICE
RE: DALY SQUARE INC., Plaintiff
and
1786097 ONTARIO INC. and CAMILLE MIKHAEL, Defendants
costs ENDORSEMENT
Williams J.
Released: August 26, 2022