Court File and Parties

Court File No.: CV-20-00640523-0000 Date: 2023-01-03 Superior Court of Justice - Ontario

Re: Caroline Chin, Plaintiff – and – 2186531 Ontario Inc. o/a Beauty Express Canada Inc., Defendant

Before: Justice E.M. Morgan

Counsel: Jennifer Chan, for the Plaintiff Emily Quail, for the Defendant

Heard: Costs submissions in writing

Costs Endorsement

[1] I issued my judgment in this wrongful dismissal case on November 7, 2022 after a two-day trial. The Plaintiff was an esthetician at the Defendant beauty shop whose position was terminated by the Defendant without sufficient notice. She was awarded 7¼ months’ pay in lieu of notice, which came to $15,701.71 (plus interest).

[2] Counsel for the Plaintiff seeks costs on a substantial indemnity basis in the all-inclusive amount of $54,777.36. She submits that the court should exercise its discretion under Rule 57.01(1)(d) and (e) of the Rules of Civil Procedure to award an elevated level of costs where the claim was of high importance to the Plaintiff and where the Defendant’s approach to the claim unduly lengthened the proceeding.

[3] Plaintiff’s counsel also points out that the final award of nearly $16,000 was greater than the Rule 49 offer to settle served by the Defendant. That offer proposed that the Defendant pay the Plaintiff $10,000 in respect of her claim.

[4] Counsel for the Defendant points out that the size of the Plaintiff’s final award is well under the Small Claims Court limit of $35,000. She submits that the court should exercise its discretion under Rule 57.05 to not award costs where the claimant’s monetary recovery would put the claim within Small Claims Court jurisdiction.

[5] Defendant’s counsel also points out that the final award of under $16,000 was considerably less than the Plaintiff’s claim of just under $200,000. The claim, the totality of which was pursued vigorously at trial, included aggravated and punitive damage claims as well as a claim under the Human Rights Code. The trial judgment dismissed those aspects of the claim in their entirety.

[6] Given the way the disposition of the trial compares with the claim and the issues pursued at trial, each side has a different view of the outcome. The Plaintiff characterizes the nearly $16,000 award as reflecting a successful claim or, at least, a partially successful claim. The Defendant characterizes the under $16,000 award as reflecting a successful defense or, at least, a partially successful defense. Each of these characterizations is in its own subjective way accurate.

[7] That said, the trial can be objectively characterized as an unfortunate waste of the parties’ resources. Taking into account the pre-trial, trial preparation, and trial time and resources they each invested into the matter, the quantity of damages is far outweighed by the legal fees. And that is to say nothing of the court time consumed by what turned out to be a rather small claim.

[8] Although Plaintiff’s counsel makes an argument about the importance of the case to the Plaintiff, and I have no doubt that it was indeed important to her, this size case is precisely what Small Claims Court is for. Pursing a claim in that court does not diminish its importance, but it does provide a more streamlined procedure appropriate to the monetary value of the case to the parties. Importantly, it also frees up Superior Court of Justice resources for claims that other courts cannot handle, making for a more efficient administration of justice.

[9] Under the circumstances, the magnitude of the case in the Plaintiff’s mind does not, as Plaintiff’s counsel suggests, point toward an increase in costs under Rule 57.01(1)(d); rather, it points toward denying costs altogether under Rule 57.05. But for the Plaintiff’s rather large overreach, the entire litigation would have been far more expeditiously and inexpensively pursued in Small Claims Court.

[10] There is nothing that I can see in the Defendant’s conduct of the action that would justify an award of substantial indemnity costs. On the contrary, the Defendant’s Rule 49 offer, while not quite measuring up to the final damages award and so not qualifying the Defendant to receive any costs, does indicate that Defendant’s counsel was assessing the claim and approaching the case reasonably and with a good legal sense of where it might go.

[11] Plaintiff’s pursuit of the extensive claim, on the other hand, appears to have been more a product of emotion than reason. She took the matter all the way to trial claiming moral damages and punitive damages based on her hurt feelings, but she did not substantiate those feelings with any objective evidence. While I have no doubt that the Plaintiff felt bad about losing her job and did not like the Defendant’s president’s way of expressing himself, bad feelings absent more do not give rise to aggravated or punitive damages. As I said in my reasons for judgment, “The trial record contains no shred of external evidence of mental distress suffered by the Plaintiff”: Chin v Beauty Express Canada Inc., 2022 ONSC 6178, at para 47.

[12] The trial was really about how many months’ worth of pay in lieu of notice the Plaintiff deserved. That question turned on a legitimate controversy between the parties as to when the Plaintiff’s employment with the current corporate embodiment of her (now former) employer really began. The Plaintiff assessed this number higher than I did, while the Defendant assessed this number lower than I did. Had the Plaintiff been more realistic in assessing the merits of the case, that controversy could have, and should have, been resolved in a far more efficient Small Claims Court hearing.

[13] In the circumstances, there will be no costs payable to either party.

Released: January 3, 2023 Morgan J.