COURT FILE NO.: CV-16-94762
DATE: 20221021
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
TAHIR QURESHI operating as ATQ FASHION Plaintiff
– and –
ROYAL & SUN ALLIANCE INSURANCE COMPANY OF CANADA Defendant
Counsel: Angela Assuras, for the Plaintiff Grant G. Walsh, for the Defendant
HEARD: In writing
Judgment on costs
SPEYER J.
[1] On August 31, 2022, I dismissed the plaintiff’s action against the defendant. The judge alone trial took place over seven days.
[2] I invited written submissions as to costs. I have received written submissions from both parties. The defendant seeks $26,010.98 for the cost of the entire action. This amount comprises 60% of the total fees incurred and disbursements and HST. The defendant characterizes its claim for costs as “modest”. The plaintiff agrees that the defendant’s submissions are reasonable but submits that the amount claimed should be reduced to account for an unsuccessful Wagg motion brought by the defendant, alleged duplication of trial preparation, late disclosure of documents by the defence, and to reflect the limited means of the plaintiff.
[3] Section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43, provides: “Subject to the provisions of an Act or rules of court, the costs of and incidental to a proceeding or a step in a proceeding are in the discretion of the court, and the court may determine by whom and to what extent the costs shall be paid”.
[4] The court is required to consider the matters described in Rule 57.01 when exercising its discretion to award costs. Those that are engaged in this case are:
(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;
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 proceedings;
g) a party’s denial of or refusal to admit anything that should have been admitted; and,
i) any other matter relevant to the question of costs.
[5] The assessment of costs is governed by the principle of reasonableness. In Davies v. Clarington (Municipality), 2009 ONCA 722, Epstein J.A. stated at paras. 51-52:
As can be seen, the overriding principle is reasonableness. If the judge fails to consider the reasonableness of the costs award, then the result can be contrary to the fundamental objective of access to justice. Rather than engage in a purely mathematical exercise, the judge awarding costs should reflect on what the court views as a reasonable amount that should be paid by the unsuccessful party rather than any exact measure of the actual costs of the successful litigant. In Boucher, this court emphasized the importance of fixing costs in an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding at para. 37, where Armstrong J.A. said “[t]he failure to refer, in assessing costs, to the overriding principle of reasonableness, can produce a result that is contrary to the fundamental objective of access to justice.”
[6] The assessment of costs is not an exercise in counting the number of hours expended on a file and then multiplying that number by an acceptable hourly rate. Rather, the court must approach its task from the perspective of determining what is reasonable and what the losing party might reasonably have expected to pay in costs. The Court of Appeal, in Davies, endorsed the following principles:
The discretion of the court must be exercised in light of the specific facts and circumstances of the case in relation to the factors set out in rule 57.01(1);
A consideration of experience, rates charged, and hours spent is appropriate, but is subject to the overriding principle of reasonableness as applied to the factual matrix of the particular case: see Boucher et al. v. Public Accountants Council for the Province of Ontario et al., 2004 CanLII 14579 (ON CA), 71 O.R. (3d) 291 (C.A.). The quantum should reflect an amount the court considers to be fair and reasonable rather than any exact measure of the actual costs to the successful litigant;
The reasonable expectation of the unsuccessful party is one of the factors to be considered in determining an amount that is fair and reasonable;
The court should seek to avoid inconsistency with comparable awards in other cases;
The court should seek to balance the indemnity principle with the fundamental objective of access to justice.
[7] Applying the Rule 57.01 factors to this case, I find that:
The lawyer for the defendant at trial has practiced law for 15 years. Some aspects of the pre-trial proceedings were handled by counsel with less experience, and a less cost.
The lawyer for the defendant spent a reasonable amount of time defending the claim.
The defendant was completely successful in defending each of two claims advanced by the plaintiff.
While the issues were not complex, the defendant had to defend itself against allegations of bad faith, which increased the complexity and importance of the issues at trial.
At the pretrial stage, the defendant agreed to waive its jury notice to allow this matter to proceed on an expedited basis as a Judge alone trial, under the Simplified Rules, which shortened the time required for trial.
The parties cooperated in the conduct of the trial and agreed to a joint document brief. Neither party improperly refused to admit anything that ought to have been admitted.
[8] The plaintiff submits that the defendant should not be awarded the costs of its unsuccessful Wagg motion. I agree. The defendant’s bill of costs addresses preparation for motions generally and does not break down how much time was spent on the Wagg motion and how much time was spent on an undertakings motion. The total amount attributed by the defendant to the preparation for and attendance at motions is $2,463.55, on a partial indemnity basis. I will deduct $1,500 from the amount of costs sought in relation to the motions to reflect that the defendant’s Wagg motion was unsuccessful.
[9] The plaintiff also submits that the defendant’s claim for trial preparation reflects a duplication of work because the preparation claimed includes the work of trial counsel, associates, and a law clerk. The plaintiff says that given the quantum and complexity of the case, there was no need for that many people to work on the file and as such, a deduction of $1,000.00 should be made. I disagree. By delegating work to junior counsel and a law clerk, counsel for the defendant mitigated his costs. The number of hours spent on this file by all members of the defence team was entirely reasonable. There was no duplication of trial preparation work.
[10] The plaintiff also claims a deduction for trial preparation in the sum of $5,000.00 because hundreds of pages of documents were served by the defendant shortly before the trial commenced, which required plaintiff’s counsel to expend time to prepare. The plaintiff also submits that I ordered the defendant to produce additional documents in the middle of the trial, which the defendant should have produced during the litigation. The plaintiff says that production of those documents earlier would have assisted counsel for the plaintiff to assess the merits of the case at an earlier stage. None of these documents were material to the outcome of the trial. The defendant did not improperly fail to disclose material documents. Rather, in an effort to expedite proceedings, the defendant agreed to produce documents rather than to argue about whether they were obliged to do so. In the overall context of the defendant’s modest claim for costs, there will be no deduction on this basis.
[11] The plaintiff seeks a reduction in the amount of costs he must pay in the amount of $4,000 because he has lost his business and did not receive the return of his goods that were removed from the premises by the defendant’s agent. A court’s decision on costs “cannot be driven by sympathy”, and “hardship” is not an enumerated factor for the court to consider under Rule 57.01 when exercising its discretion on costs: Sacks v. Ross, 2016 ONSC 2498, at para. 34. While courts have, on occasion, exercised their discretion to reduce an award of costs for reasons related to hardship, I decline to do so in this case. The amount of cost sought by the defendant is indeed modest. The goods removed from the plaintiff’s premises were non-salvageable and not saleable. The plaintiff was represented by experienced counsel who no doubt advised him of the costs risks of bringing his action. He chose to pursue an action that lacked merit. There will be no reduction in the amount of the defendant’s costs on the grounds of hardship.
[12] In conclusion, the plaintiff is ordered to pay costs to the defendant in the amount of $24,500, which is payable within 30 days. That is a fair and reasonable amount, given the issues involved in this seven-day long trial. It is an amount that the plaintiff might reasonably have expected to pay in the event that his action was unsuccessful.
The Honourable Madam Justice J. Speyer
Released: October 21, 2022
COURT FILE NO.: CV-16-94762
DATE: 20221021
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
TAHIR QURESHI operating as ATQ FASHION Plaintiff
– and –
ROYAL & SUN ALLIANCE INSURANCE COMPANY OF CANADA Defendant
JUDGMENT ON COSTS
The Honourable Madam Justice J. Speyer
Released: October 21, 2022