Court File and Parties

Newmarket Court File No.: CV-23-1200 Date: 2024-01-02 Superior Court of Justice - Ontario

Re: Shehryar Ahmad, Applicant And: Robert John Estacio Marques, Respondent

Before: The Honourable Madam Justice M.E. Vallee

Counsel: Amanpreet Singh Nagpal, Counsel for the Applicant Gregory P. Weedon, Counsel for the Respondent

Heard: In writing

Costs Endorsement

[1] The applicant purchaser brought a motion for a certificate of pending litigation regarding a failed real estate transaction. It failed because the purchaser was unable to obtain financing to close, even though the seller granted several extensions. The respondent was successful in defending the motion. The applicant did not request an order regarding the deposits.

[2] On September 25, 2023, the respondent seller made a Rule 49 offer to settle on terms that the applicant would abandon or dismiss the motion and pay to him costs in the amount of $4,500. The applicant states that he was unsuccessful in obtaining the certificate of pending litigation but he was successful in obtaining an order that the deposits together with pre-judgment interest to the date of a future sale be held back from those sale proceeds by the solicitor for the seller.

[3] I reject that this constitutes any measure of success. The motion did not request this order. The respondent’s counsel states that dealing with the deposits in this manner was offered during submissions. Interpretation of the clause relating to the deposits will be for another day.

[4] The respondent is entitled to partial indemnity costs up to the date of the offer and substantial indemnity costs afterwards. The respondent requests $7,789.15 in fees and $1,892.02 for disbursements plus HST.

Costs Factors

[5] Section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C. 43 states that the costs of a proceeding are in the discretion of the court. Rule 57.01 states that in exercising its discretion to award costs, the court may consider, in addition to the result, a number of other factors. The applicable factors in this matter include:

a. the principle of indemnity including the experience of the lawyers for the party entitled to costs as well as the rates charged and the hours spent; b. the amount of costs that an unsuccessful party could reasonably expect to pay; c. the amount claimed and the amount recovered; d. the apportionment of liability; e. the importance of the issues; f. the conduct of any party that tended to shorten or lengthen unnecessarily the duration of the proceeds; and, g. a party’s denial or refusal to admit anything that should have been admitted.

Reasonableness and Proportionality

[6] According to Boucher v. Public Accountants, [2004] O.J. No. 2634, para. 37, in determining costs, the overriding principle is reasonableness. The expectation of the parties is a relevant factor concerning the amount of costs to be awarded. Rule 1.04 (1.1) requires that the court make orders that are proportionate to the importance and complexity of the issues and to the amount involved in the proceeding.

The Applicant’s Position

[7] The applicant, who was unsuccessful on the motion, requests costs on a partial indemnity basis of $1,000 including HST and disbursements or in the alternative that no costs be awarded. He raises the deposits issue that I have addressed above. He also states that he was unable to obtain financing to close the deal because of force majeure events, “specifically the economy’s high inflation and the Bank of Canada's continued hike in its key interest rates…”

[8] The applicant also states that the respondents offer to settle was not reasonable because if he had accepted the offer, he would not be able to bring another application.

Analysis

[9] The reason why the applicant was unable to obtain financing is immaterial. He entered into an agreement of purchase and sale and waived the condition. The applicant’s submission concerning the unreasonableness of the offer is illogical. Likely any offer to settle made by the respondent would have required that the motion be dismissed.

[10] Defending this motion was important to the respondent. The evidence was that he had to sell the property because he could not afford the carrying charges. Having a certificate of pending litigation registered against it would have hindered a resale.

[11] The applicant raised frivolous arguments such as a requirement for spousal consent when the property was not a residence and failure to act in good faith by not granting a fifth extension.

[12] The respondent states that it uploaded its costs outline a few days prior to the hearing date. Accordingly, the applicant knew in advance the position that the respondent would take on costs; therefore, the applicant knew what he could reasonably expect to pay if he were unsuccessful on the motion.

[13] I have reviewed the respondent’s cost outline. Counsel has 8 years of experience. His hourly rate is $450. Prior to the offer, 7.6 hours were spent which included drafting the responding affidavit. On the day that the offer was served, cross-examinations were held for two hours. On the next day, cross-examinations were held for 4.5 hours. A factum, book of authorities and supplementary responding record were served and filed. Counsel spent 15 hours doing this work which includes preparation for the motion and attendance. I note that there is nothing charged for clerk time. I find that the hours spent and the hourly rate are reasonable.

[14] Regarding disbursements, the largest charge is $1,719.52 for a transcript. The invoice shows that HST was included. The list includes $97.50 for title searches but there is no evidence of this cost. It also includes $75 for software but there is no description of the software or any evidence showing the amount.

Conclusion

[15] I find that a reasonable and proportionate amount for the respondent’s costs is $7,789.15 plus $1,719.52 for the disbursement, which the applicant shall pay to the respondent within 30 days.

VALLEE J. Date: January 2, 2024