COURT FILE NO.: 07-CV-009334-D1 DATE: 20230403

SUPERIOR COURT OF JUSTICE – ONTARIO

IN THE MATTER OF the Construction Lien Act, R.S.O. 1990, c. C.30

RE: Southside Construction (London) Limited, Plaintiff/Defendant by Counterclaim

AND:

The Corporation of the City of Windsor, Defendant/Plaintiff by Counterclaim

AND:

Montgomery Sisam Architects Inc., J.P. Thomson Associates Ltd., JMR Electric Ltd., Jemini Construction Ltd., Forest City Forming Ltd., Bravo Cement Contracting Inc., Artisan Masonry Inc., Prestressed Systems Inc., Plaza Ontario Marble & Tile Incorporated, Trend Millwork & Cabinets Inc., D & M Glass & Mirror Ltd., Flynn Canada Ltd. and Williams Food Equipment Company (1998) Limited and Robson Acoustics & Drywall (2002) Inc., Third Parties to the Counterclaim

BEFORE: Howard J.

COUNSEL: James A. LeBer and Eric A.F. Grigg, for the Plaintiff Daniel A. Boan, for the Defendant Andrew Lundy, for the Third Parties Montgomery Sisam Architects Inc. and J.P. Thomson Associates Ltd.

HEARD: Written submissions

COSTS ENDORSEMENT

Overview

1I was designated the case management judge for this matter in November 2015. I have released several decisions in connection with this matter since that time.

2In February 2004, the City of Windsor (the “City”), as owner, entered into a construction contract with Southside Construction (London) Limited (“Southside”), as general contractor, for the construction of a 224-bed long-term care facility in Windsor, known as the Huron Lodge Home for Seniors. The contract named Montgomery Sisam Architects Inc. and J.P. Thomson Associates Ltd. as the architectural consultants (the “Architects”).

3In my reasons for decision released April 11, 2022, ¹ I allowed the motions brought by the plaintiff Southside and third party Architects seeking, inter alia, an order pursuant to s. 106 of the Courts of Justice Act ² staying the City’s counterclaim against Southside, the City’s third party claim against the Architects, and the counterclaims, crossclaims, or other claims of the eight third party subtrades, ³ who had reached conditional settlement with the City from August through to October 2013 (the “Eight Settlement Agreements”).

4In my Abuse of Process Decision, I concluded that:

… the City’s failure to disclose immediately to the court and the non-settling parties the complete terms of the Eight Settlement Agreements that fundamentally altered the litigation landscape constitutes an abuse of process. I conclude further that the only appropriate sanction to remedy that abuse of process by the City is to stay its claims against Southside and the Architects. ⁴

5In para. 106 of my Abuse of Process Decision, I fixed a schedule for delivery of the parties’ costs submissions in the event that they were unable to agree on the question of the costs of the motion.

6The parties have been unable to agree on costs.

7Southside, the Architects, and the City have all delivered their various submissions in accordance with the prescribed schedule. ⁵

8I have read and considered all the submissions, costs outlines, and other materials received.

9The position of Southside is that they are entitled to the costs of their motion on a full indemnity basis in the amount of $105,000, plus HST.

10The position of the Architects is that they are entitled to the costs of their motion and the third party claim against them, collectively, in the amount of $123,050.15, all inclusive.

11The position of the City is that Southside and the Architects are entitled to their partial indemnity costs only, subject to certain deductions identified in the City’s Responding Submissions.

Governing Legal Principles

12In Ontario, cost awards in civil law matters are governed by s. 131 of the Courts of Justice Act ⁶ and, in most cases, rule 57.01 of the Rules of Civil Procedure. ⁷

13Subsection 131(1) of the Courts of Justice Act confers upon the court a general discretion to determine costs, in the following terms:

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.

14It has been said that making an award of costs is inherently an exercise of judicial discretion. Indeed, the Supreme Court of Canada and our Court of Appeal have held that, “costs awards are ‘quintessentially discretionary.’” ⁸

15That said, the discretion conferred by s. 131(1) of the Courts of Justice Act is expressly made subject to the “rules of court.” Rule 57 of the Rules of Civil Procedure deals with the awarding and fixing of costs in civil proceedings and provides guidance in the exercise of the court’s discretion by enumerating circumstances and factors that the court may consider when determining costs. In this regard, subrule 57.01(1) provides that:

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;

(h.1) whether a party unreasonably objected to proceeding by telephone conference or video conference under rule 1.08; and

(i) any other matter relevant to the question of costs.

16The indemnification of the successful party is a paramount objective – but not the only one – to be served by a costs order. ⁹ Our Court of Appeal has recognized that: “[m]odern costs rules are designed to foster three fundamental purposes: (1) to partially indemnify successful litigants for the cost of litigation; (2) to encourage settlement; and (3) to discourage and sanction inappropriate behaviour by litigants.” ¹⁰

17In DUCA Financial Services Credit Union Ltd. v. Bozzo, 2010 ONSC 4601, Cumming J. described the “normative approach” to costs awards in Ontario as follows:

… first, that costs follow the event, premised upon a two-way, or loser pay, costs approach; second, that costs are awarded on a partial indemnity basis; and third, that costs are payable forthwith, i.e., within 30 days. Discretion can, of course, be exercised in exceptional circumstances to depart from any one or more of these norms. ¹¹

18In fixing the amount of costs to be awarded, the court’s objective is not to reimburse a litigant for every dollar spent on legal fees. “The fixing of costs is not a bookkeeping exercise.” ¹² Rather, in exercising its discretion, a court must produce a result that is fair and reasonable in all the circumstances. ¹³ The “overriding principle is reasonableness.” ¹⁴

19As the Ontario Court of Appeal observed in its leading decision in Boucher v. Public Accountants Council (Ontario) (2004), 71 O.R. (3d) 291: “[o]verall, as this court has said, the objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding, rather than an amount fixed by the actual costs incurred by the successful litigant.” ¹⁵

20The court should also consider the totality of the costs award to ensure that it is not disproportionate to the amount recovered. ¹⁶ That is consistent with the directive of subrule 1.04(1.1) of the Rules of Civil Procedure that in applying the rules, “the court shall make orders and give directions that are proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding.” That said, while the consideration of proportionality “is necessary to the soundness of any costs award and to ensure the health of the justice system,” the overarching principle remains that the order for costs must be fair and reasonable. ¹⁷

21I am guided by these governing principles here.

Analysis

Presumptive entitlement

22As I have reviewed above, the indemnification of the successful party is a paramount objective in making costs awards, and the “normative approach” in Ontario is that costs should follow the event.

23There is no reason to depart from the presumptive rule here. Southside and the Architects were the successful parties on the motions and are entitled to their costs. In fairness, the City does not contest their entitlement to costs.

Preliminary objection: no express claim for costs

24However, the City argues that contrary to clause 37.06 (a) of the Rules of Civil Procedure, which requires that every notice of motion shall “state the precise relief sought,” both Southside and the Architects “did not state that they were seeking costs” ¹⁸ in their respective notices of motion. The City argues that, because of their omissions, Southside and the Architects should be awarded costs on a partial indemnity basis only.

25To my mind, the argument of the City “proves too much.” That is, if there is any merit in the City’s reliance on clause 37.06 (a) in the instant circumstances, then one would have thought that the logical conclusion would be that Southside and the Architects would not be entitled to costs at all. However, I note the City does not argue for that outcome. Tellingly, in its final submission as to the appropriate disposition here, the City proposes that Southside and the Architects should “be awarded costs on a partial indemnity basis,” either with or without the deductions proposed by the City.

26In any event, the City’s objection must fail on the law. The Ontario Court of Appeal has said that, although clause 37.06 (a) requires a party to set out the relief sought in the notice of motion, “a costs award is incidental to the substantive relief claimed” and – “absent prejudice to the losing party” – there is no reason why the failure to ask for costs in the notice of motion should, in itself, preclude the court from making such an order where costs are requested at the hearing. ¹⁹

27In the instant case, there is no evidence of prejudice on the part of the City. Further, there is no evidence that the City would have conducted itself in any different manner if the request for costs on an elevated scale had been expressly claimed in the notices of motion.

28Moreover, subrule 57.03(1) requires the court, on the hearing of a contested motion, to order costs unless the court is satisfied that a different order would be more just. So then, as soon as the City opposed the motions, the question of entitlement to costs and, in turn, the questions of the proper scale and quantum of those costs, were placed in issue. I should think that this point distinguishes a claim for costs from other claims for relief that, if not expressly pled, may well take a responding party by surprise, thus raising a question of procedural unfairness. But here, as counsel for Southside puts it, “a responding party cannot be surprised when the court does what the Rules say it must do and fixes the costs of the contested motion.” ²⁰

The scale of the costs award

29The central dispute between the parties is the question of the scale of the award. Southside and the Architects submit that they should be awarded costs on an elevated scale. The City maintains that the award of costs should be made on the partial indemnity scale.

30More particularly, Southside seeks its costs of the abuse of process motion on a full indemnity basis in the amount of $105,000 plus HST. In the alternative, Southside asks that its costs on the motion be fixed on a substantial indemnity basis in the amount of $91,000 plus HST. The Architects request that their total costs be fixed in the all-inclusive amount of $123,050.16, being the total of their claims that their costs of the actions up to and including the examinations for discovery be fixed in the amount of $68,613.98 on a partial indemnity basis and their costs of the abuse of process motion be fixed in the amount of $54,436.18 on a substantial indemnity basis.

31The City raises, in essence, a preliminary objection to the question of the scale of the award.

32The City submits that it offered to resolve the issue of costs without the need for written submissions. The City states that on May 4, 2022, the City offered to settle the issue of costs with Southside and the Architects on a partial indemnity basis, without the need for written submissions, but Southside and the Architects did not accept the offer.

33As I understand it, the City relies on this point to argue that Southside and the Architects should be precluded from recovering costs on any elevated scale. The City argues, in essence, that because Southside and the Architects did not accept the City’s offer of costs on a partial indemnity basis, they are thereby restricted to costs on a partial indemnity basis.

34In my view, there is no merit to the City’s position. One would think that if, in law, all that was necessary to insulate a losing party from an award of costs on an elevated scale was simply for that losing party to make an offer to pay costs on a partial indemnity scale, such an offer would be made in every case.

35In its reply to the City’s argument, Southside submitted that:

Perhaps, by analogy to Rule 49, this offer after the motion [may be] relevant to assessing the costs of the costs submissions. But it cannot be that the losing party can disentitle the winning party to its costs of the motion on an elevated scale, if the circumstances of the motion would otherwise so justify, by delivering a self-serving offer to pay the winning party less than what it would otherwise be due. ²¹

36I agree completely with counsel for Southside on that point.

37There is no real disagreement between the parties as to the legal principles that apply to claims for an award of costs on an elevated scale. All parties agree that an award of costs on an elevated scale is justified in only very narrow circumstances. As our Court of Appeal said in Net Connect Installation Inc. v. Mobile Zone Inc., 2017 ONCA 766:

An award of costs on an elevated scale is justified in only very narrow circumstances – where an offer to settle is engaged or where the losing party has engaged in behaviour worthy of sanction: Davies v. Clarington (Municipality) (2009), 2009 ONCA 722, 100 O.R. (3d) 66 (Ont. C.A.) at para. 28. Substantial indemnity costs is the elevated scale of costs normally resorted to when the court wishes to express its disapproval of the conduct of a party to the litigation. It follows that conduct worthy of sanction would have to be especially egregious to justify the highest scale of full indemnity costs. ²²

38That said, I would remind the City that in this case I made express findings that the City engaged in a course of conduct that amounted to an abuse of the process of this court.

39I had made previous findings, in my decision of October 2018, that the failure of the City’s representative to fully inform himself, in anticipation of his cross-examination, resulted in a “procedural abuse” and a “fundamental denial” of the rights of Southside and the Architects to any meaningful examination of the City on the full extent and scope of all settlement agreements and whether there had been complete and immediate production of all aspect of all such agreements. ²³

40In my Abuse of Process Decision, I expressly, and repeatedly, found that the conduct of the City amounted to an abuse of process. In paras. 85-89 of my Abuse of Process Decision, which are particularly relevant to the question of costs, I found that:

It simply cannot be said that disclosure of the critical terms of the Eight Settlement Agreements that came more than six years after City council’s approval of the agreements on October 21, 2013, satisfies an immediate disclosure requirement.

In Aecon, MacFarland J.A. observed that, “[o]ther parties to the litigation are not required to make inquiries to seek out such agreements.”

But that is exactly what Southside and the Architects were forced into undertaking, given the failure of the City to satisfy its obligation to make immediate disclosure. Their quest began with their cross-motion for production of the settlement documents, originally returnable November 20, 2013, coincident with the City’s motion for the OTC. It came to conclusion, six plus years later, on December 4, 2019, with Mr. Bannon’s cross-examination.

As the events here unfolded, the City made some disclosure of the Eight Settlement Agreements in November 2013, with production of only the one document evidencing the agreements, being the one-page, standard form Assignments. As recounted above, some further disclosure was made by Mr. Bannon on February 6, 2014. This “trail of crumbs” pattern of disclosure continued until the cross-examination of Mr. Bannon in December 2019. To their credit, Southside and the Architects relentlessly pursued the City’s “trail of crumbs” to conclusion. But that protracted exercise should never have been necessary. The City’s failure to make immediate disclosure of the Eight Settlement Agreements flies in the face of the admonition of Myers J. in Tallman Truck that, “[m]andatory disclosure is not made by taking steps that give a hint to people skilled in the art.” [Emphasis added.]

Indeed, on the evidence before me, where Southside has described the City’s efforts at disclosing the terms of the Eight Settlement Agreements in the following terms – “involuntary, irregular, incomplete, insincere; anything but what it had to be: immediate” – I am unable to say that characterization is unfair.

I conclude that the City’s failure to disclose immediately to the court and the non-settling parties the complete terms of the Eight Settlement Agreements that fundamentally altered the litigation landscape constitutes an abuse of process. I conclude further that the only appropriate sanction to remedy that abuse of process by the City is to stay its claims against Southside and the Architects. ²⁴

41The circumstances of this case, and my findings of abuse of the process of this court by the City, practically compel this court “to express its disapproval of the conduct of a party to the litigation” – to borrow the language of the Court of Appeal in Net Connect. An award of substantial indemnity costs is appropriate here in order to express the court’s disapproval of the conduct of the City in this proceeding.

42In this regard, I agree with the submissions of Southside that:

Full disclosure of the terms of the [Eight Settlement Agreements] was not made before Justice Gates. Counsel for Windsor appeared before Justice Gates, and as an officer of the court, represented to this Court that the Brudney affidavit and the single page Assignment document attached provided full disclosure of all the terms of the secret agreements. This was done despite the assurances given by [the City] as part of the deal that bought the silence of counsel for the settling sub-trades that [the City] would make full disclosure on their behalf. [The City]’s lawyer then handed to Justice Gates a form of Order to Continue prepared by [the City]’s lawyer, and which removed the sub-trades from the litigation by virtue of an improper restatement of the title of proceedings found on the last page of the draft Order.

[The City] did this with the intention that Justice Gates should sign this order removing the third party sub-trades from the proceeding. That is, [the City] intended to effect a unilateral and undisclosed assignment of the sub-trades’ liabilities to the City.

That is, [the City] intended Justice Gates to sign an order that purported to effect a legal impossibility: the non-consensual assignment of liabilities. It should go without saying that such an order would not have issued had the full context been disclosed.

It is not only the parties that remain in the litigation that suffer harm when a litigation landscape altering agreement is not immediately and fully disclosed. It is also the Court that is at risk of being misled as to its process. ²⁵

43Further, I also agree, in principle, with counsel for Southside that the very purpose of the principle enunciated in Aecon Buildings v. Brampton (City), 2010 ONCA 898 ²⁶ and Handley Estate v. DTE Industries Limited, 2018 ONCA 324 ²⁷ “is to deter non-disclosure in future proceedings. So, where, as here, a proceeding is stayed based on Aecom and Handley, [a costs award on an elevated scale is] entirely consistent with and support that deterrent purpose.” ²⁸

44Moreover, I also agree with counsel for the Architects that the motions for a stay of proceedings were necessary only because of the City’s “egregious lack of candour” and that such conduct presents a paradigmatic exceptional case meriting a substantial indemnity award, signifying the court’s disapproval of the City’s conduct. ²⁹

45For all of these reasons, I find that Southside and the Architects are entitled to their costs of the abuse of process motions on a substantial indemnity basis.

46It follows that I am not convinced that Southside is entitled to its costs of the motion on a full indemnity scale. Southside has recognized, very fairly, that “the conceptual category of abuse of process admits of a broad range of conduct, ranging from the technical to the egregious.” ³⁰

47While I certainly do not wish to be taken as having approved of or condoned – in any way – the conduct of the City in this case, at the same time, I cannot say that Southside has convinced me – and the onus rests on Southside – that the City has engaged in conduct that is so “especially egregious to justify the highest scale of full indemnity costs.” ³¹

Quantum of Southside’s claim for costs

48I have considered all of the factors enumerated in subrule 57.01(1) of the Rules of Civil Procedure, not all of which are equally relevant in the instant circumstances (or at all). As such, I do not propose to specifically address each of the factors below.

49As I have said, Southside claims, on a substantial indemnity basis, the total amount of $91,000, plus HST. By my calculation, the actual amount, on a substantial indemnity basis, is $90,830.16, being comprised of $89,445.48 for fees (inclusive of HST) and $1,384.68 on account of disbursements (inclusive of HST). ³²

50The City complains that Southside has claimed costs for the preparation and attendance at the cross-examination of Mr. Keith Bannon, which, the City says, reflects work unrelated to the abuse of process motions. ³³

51Respectfully, I disagree. Mr. Bannon’s evidence played an integral role on the abuse of process motions. Counsel for Southside calculates that in the course of my reasons, I cited the transcript of the cross-examination 14 times. That evidence provided the factual foundation for my ruling that full disclosure of the critical terms of the Eight Settlement Agreements was not fully discovered by Southside and the Architects until Mr. Bannon’s cross-examination in December 2019, more than six years after those Agreements were concluded.

52The City also complains that Southside seeks costs of approximately $3,400 “for digitizing its file contents as the litigation moved from in-person to virtual hearings. This was an administrative decision and task that did not advance the litigation in any way.” ³⁴

53Again, respectfully, I disagree. Counsel for Southside undertook that task at the request of the court for the benefit of all counsel and the court. That was a necessary step, beneficial to all – certainly it was to me – that facilitated the transition from in-person hearings to the virtual hearing of the abuse of process motion. Counsel for Southside explains that the task “required time to be spent checking back against motion materials from the [five] prior motions to ensure all material was included, labeled, uploaded and able to be cross-referenced to the hard copy briefs which the Court and counsel had originally worked from and marked up.” ³⁵ Those costs are recoverable.

54In sum, I find no merit in the City’s complaints about the quantum of Southside’s claim for costs. ³⁶

55Having considered, inter alia, the submissions of the parties and the costs outline of Southside, the relevant factors enumerated in subrule 57.01(1) of the Rules of Civil Procedure, and the principles that should guide the court’s exercise of its discretion under s. 131 of the Courts of Justice Act to award costs, I find that the amount of $90,830.16, all inclusive, represents a fair, reasonable, and proportionate costs award in the circumstances of the abuse of process motions.

56Accordingly, I fix the quantum of Southside’s costs of the motions, on a substantial indemnity basis, in the amount of $90,830.16, all inclusive.

Quantum of the Architects’ claim for costs

57The Architects seek recovery of their costs in the total amount of $123,050.16, which comprises $68,613.98 for the costs of defending the action up to and including examinations for discovery, on a partial indemnity basis (including $56,476.72 for fees, inclusive of HST, and $12,137.26 for disbursements, inclusive of HST), and $54,436.18 for the costs of the abuse of process motions, on a substantial indemnity basis (including $52,133.23, inclusive of HST, and $2,302.95, inclusive of HST).

58The City argues that the Architects are not entitled to costs of the action. Respectfully, I disagree. The outcome of the abuse of process motions was entirely dispositive of the claims against the Architects. They are entitled to their costs of the proceeding.

59The overwhelming majority of the work incurred on behalf of the Architects was performed by the late Mr. Brunner and Mr. Lundy. At the time of his passing in July 2020, Mr. Brunner had 56 years of experience. The partial indemnity rate sought in respect of the work performed by Mr. Brunner is $237 per hour and the substantial indemnity rate is $316. Those rates are beyond challenge. The partial indemnity rate sought in respect of the work performed by Mr. Lundy, who has 32 years of experience, is $216 per hour and the substantial indemnity rate is $288. Again, those rates are certainly fair and reasonable. (The same is also true for the rates charged by counsel for Southside.) In fairness, the City raised no objection to the hourly rates sought by any counsel.

60The City makes the same objection to the Architects claiming for the preparation and attendance at the cross-examination of Mr. Bannon that it raised with respect to Southside’s similar claim, and I have already dismissed that complaint.

61The City submits that the Architects’ costs are not comparable to the City’s because the City prepared two sets of a responding motion record and factum. Leaving aside the considerable overlap in the City’s responding materials on the two motions, the consideration for the purposes of clause 57.01(1) (0.b) is “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.” The hourly rates claimed on behalf of the Architects are considerably lower than the rates claimed on behalf of the City. Even allowing for the City’s claim that it prepared two sets of materials, I note that the costs outline delivered by the City on July 8, 2021, for the abuse of process motions only sought $118,871.54 on a substantial indemnity basis, as compared to the $54,436.18 amount claimed on behalf of the Architects. In my view, the amounts claimed by the Architects (and Southside) for fees and disbursements would be well within the reasonable contemplation of the City and all the litigants involved in the proceeding.

62Finally, the City takes issue with the $2,302.95 amount claimed by the Architects for disbursements on the motions. I have reviewed the Architects’ claim for disbursements as set out in its costs outline, and I note that the amounts in question were incurred for items like process server fees, discovery charges, transcript charges, travelling expenses for the appearances in Windsor, and the like. I am satisfied that the amounts claimed are reasonable and appropriate.

63In sum, I find the amounts claimed by the Architects for costs represent a fair, reasonable, and proportionate costs award.

64Accordingly, I fix the quantum of the Architects’ costs of the action up to and including the examinations for discovery, on a partial indemnity basis, in the amount of $68,613.98, all inclusive, and their costs of the abuse of process motions, on a substantial basis, in the amount of $54,436.18.

Conclusion

65Therefore, there shall be an order that the City shall pay Southside its costs of the abuse of process motions in the total amount of $90,830.16, and the Architects its costs of the action and motions in the total amount of $123,050.16, within 30 days.

Original Signed by “Justice J.P.R. Howard”

J. Paul R. Howard

Justice

Date: April 3, 2023

Footnotes

Footnotes

1. 1Southside Construction v. City of Windsor, 2022 ONSC 2241 (S.C.J.) [Abuse of Process Decision].
2. 2Courts of Justice Act, R.S.O. 1990, c. C.43.
3. 3The eight third party subtrades in issue are: JMR Electric Ltd., Forest City Forming Ltd., Jemini Construction Ltd., Plaza Ontario Marble and Tire Incorporated, Trend Millwork & Cabinets Inc., D&M Glass & Mirror Ltd., Flynn Canada Ltd., and Robson Acoustics & Drywall (2002) Inc.
4. 4Abuse of Process Decision, at para. 96.
5. 5See Southside’s cost submissions dated May 11, 2022 (“Southside’s Main Submissions”); the Architect’s cost submissions dated May 11, 2022 (the “Architects’ Main Submissions”); the City’s responding cost submissions dated May 31, 2022 (the “City’s Responding Submissions”); Southside’s reply costs submissions dated June 6, 2022 (“Southside’s Reply Submissions”); and the Architects’ reply costs submissions dated June 22, 2022 (the “Architects’ Reply Submissions”).
6. 6Courts of Justice Act, R.S.O. 1990, c. C.43.
7. 7Rules of Civil Procedure, R.R.O. 1990, Reg. 194.
8. 8Kerry (Canada) Inc. v. Ontario (Superintendent of Financial Services), 2009 SCC 39, [2009] 2 S.C.R. 678, 102 O.R. (3d) 319, at para. 126. See also Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, [2004] 1 S.C.R. 303 (S.C.C.), at para. 27; Mars Canada Inc. v. Bemco Cash & Carry Inc., 2018 ONCA 239, 140 O.R. (3d) 81, at para. 43.; and Fielding v. Fielding, 2015 ONCA 901, 129 O.R. (3d) 65, at para. 67.
9. 9Watterson v. Canadian EMU, 2018 ONSC 301 (Div. Ct.), at para. 8.
10. 10Serra v. Serra, 2009 ONCA 395, 66 R.F.L. (6th) 40, at para. 8, citing Fong v. Chan (1999), 46 O.R. (3d) 330 (C.A.), at para. 22. See also 1465778 Ontario Inc. v. 1122077 Ontario Ltd. (2006), 82 O.R. (3d) 757 (C.A.), at para. 26. Five broad purposes were identified by Perell J. in Sheppard v. McKenzie, [2009] O.J. No. 3677, at para. 17.
11. 11DUCA Financial Services Credit Union Ltd. v. Bozzo, 2010 ONSC 4601 (S.C.J.), at para. 5.
12. 12Bondy-Rafael v. Potrebic, 2019 ONCA 1026, 441 D.L.R. (4th) 658, 47 C.P.C. (8th) 245, at para. 64.
13. 13Ibid., at para. 7. See also Kuzev v. Roha Sheet Metal Ltd., 2007 CarswellOnt 4338, 227 O.A.C. 3 (Div. Ct.), at para. 6, citing Murano v. Bank of Montreal (1998), 41 O.R. (3d) 222, 163 D.L.R. (4th) 21, 22 C.P.C. (4th) 235 (C.A.) [cited to O.R.], at p. 247 per Morden A.C.J.O., and Zesta Engineering Ltd. v. Cloutier, [2002] O.J. No. 4495, 21 C.C.E.L. (3d) 161 (C.A.), at para. 4, and quoting Moon v. Sher, [2004] O.J. No. 4651, 246 D.L.R. (4th) 440 (C.A.), at para. 30 per Borins J.A.
14. 14Davies v. Clarington (Municipality), 2009 ONCA 722, 100 O.R. (3d) 66, 312 D.L.R. (4th), at para. 52.
15. 15Boucher v. Public Accountants Council (Ontario) (2004), 71 O.R. (3d) 291 (C.A.), at para. 26. See also Bondy-Rafael v. Potrebic, at para. 53.
16. 16R & G Draper Farms (Keswick) Ltd. v. Nature’s Finest Produce Ltd., 2016 ONCA 626, 133 O.R. (3d) 395, at para. 23.
17. 17Bondy-Rafael v. Potrebic, at para. 64.
18. 18City’s Responding Submissions, at para. 4.
19. 19Akagi v. Synergy Group (2000) Inc., 2015 ONCA 771, 128 O.R. 64, at para. 14, citing Kretzschmann v. Greater Sudbury (City), 2010 ONSC 327, 69 M.P.L.R. (4th) 114 (S.C.J.), at para. 10; Lemieux v. Canada (Attorney General), [2005] O.J. No. 3167 (S.C.J.), at para. 7; and Hakim Optical Laboratory Ltd. v. Phillips (2009), 96 O.R. (3d) 798 (S.C.J., Master), at paras. 2 and 4-7.
20. 20Southside’s Reply Submissions, at para. 3.
21. 21Southside’s Reply Submissions, at para. 5.
22. 22Net Connect Installation Inc. v. Mobile Zone Inc., 2017 ONCA 766, 140 O.R. (3d) 77, at para. 8 [Net Connect]. See also Mars Canada Inc. v. Bemco Cash & Carry Inc., 2018 ONCA 239, 140 O.R. (3d) 81, at paras. 42-44 per Strathy C.J.O.
23. 23See Southside Construction v. City of Windsor, 2018 ONSC 6137 (S.C.J.) [unreported], at paras. 30-38, leave to appeal to Div. Ct. refused with costs (21 June 2019), Toronto file no. 697/18 [unreported], appeal to Ontario Court of Appeal by K. Bannon dismissed with costs, 2019 ONCA 787; and Abuse of Process Decision, at para. 47.
24. 24Abuse of Process Decision, at paras. 85-89 and 96 [citations omitted]. See also paras. 91, 96, 97, 98, and 99 for specific references to the City’s abuse of process.
25. 25Southside’s Main Submissions, at paras. 11-14. I note, in particular, that Southside’s submissions, as quoted, as to the intention of the City are borne out by a review of the Motion Record of Southside dated January 7, 2021, Tab 2-A, Transcript of the Examination of Keith Bannon taken on December 4, 2019, at pp. 52-55, QQ. 189-199.
26. 26Aecon Buildings v. Brampton (City), 2010 ONCA 898, 328 D.L.R. (4th) 488, 98 C.L.R. (3d) 1 [Aecon], leave to appeal to the S.C.C. refused, 425 N.R. 400 (note).
27. 27Handley Estate v. DTE Industries Limited, 2018 ONCA 324, 421 D.L.R. (4th) 636, 17 C.P.C. (8th) 271 [Handley Estate].
28. 28Southside’s Main Submissions, at para. 16.
29. 29Architects’ Reply Submissions, at p. 1.
30. 30Southside’s Main Submissions, at para. 15.
31. 31Net Connect, at para. 8.
32. 32In para. 5 of Southside’s Main Submissions, it claims “$91,000 plus HST.” Respectfully, I believe the $91,000 includes HST. The costs outline attached to Southside’s Main Submissions (at p. 9 of those Submissions) states that the outline is “inclusive of HST.” It sets out substantial indemnity fees, inclusive of HST, of $77,709.48. The outline then estimated the costs of final preparation and attendance of two counsel for the two days of the motion to be $12,408.40, inclusive of HST (being the sum of the estimated $10,983.60 for appearance fees and the estimated $1,424.80 for preparation). However, in para. 5 of Southside’s Main Submissions, Southsides explains that while it had estimated “$12,408 on a substantial indemnity basis,” the “actual fees incurred for the motion, on a substantial indemnity basis (90% of actual), was the sum of $11,736.” The sum of the substantial indemnity fees, inclusive of HST, of $77,709.48 as set out in the costs outline, plus the actual fees incurred for the motion on a substantial indemnity basis of $11,736 (subtotal for fees being $89,445.48), plus the disbursements of $1,384.68, is $90,830.16.
33. 33City’s Responding Submissions, at para. 10.
34. 34Ibid., at para. 11.
35. 35Southside’s Reply Submissions, at para. 11.
36. 36In para. 12 of the City’s Responding Submissions, it complains about the $4,000 said to be claimed for preparation of Southside’s costs submissions. I appreciate that para. 3 of Southside’s Main Submissions indicates that the $4,000 amount was included in Southside’s claim for full indemnity costs in the amount of $105,000 plus HST. I have not allowed that claim. What I have allowed for preparation of the costs submissions is the $700 amount claimed in Southside’s cost outline for work done by Mr. Grigg on July 6, 2021.