Court File and Parties
Court File No.: CV-23-1105-00 Date: 2024-05-17 Superior Court of Justice – Ontario
Between: Nicholas Fiorini, Applicant And: Alfredo Malanca and Katarzyna Pikula and 197 McKay BaiTie Corp, Respondents
Before: J. Speyer J.
Counsel: Nicholas Fiorini, Self-represented Adrian Pel, for the Respondents
Heard: In writing
DECISION AS TO COSTS
A. Introduction
[1] On March 20, 2024, I dismissed Mr. Fiorini's application for various forms of relief directed to enforcing what he alleged was an interest in a property. I concluded that there was no credible evidence to support Mr. Fiorini's position. The evidence that I accepted compelled the conclusion that Mr. Fiorini had no legal or beneficial claim to any interest in the property.
[2] I invited written submissions as to costs from the parties. Having considered those submissions, these are my reasons for awarding costs to the respondents in the amount of $70,000.
[3] The respondents submit that they were entirely successful on the application and seek costs on a substantial indemnity basis in the amount of $80,000. The respondents argue that substantial indemnity costs are appropriate because the application was a meritless and abusive vehicle for retaliation, and was therefore deserving of sanction.
[4] Mr. Fiorini filed no materials in response to the respondents' request for costs. In an email he wrote that he was not aware that a response was needed regarding costs, and expressed his view that the respondents' position as to costs is excessive, as it was not necessary that two lawyers appear for the respondents at the cross-examinations and hearing of the motion, given that he was self-represented. Mr. Fiorini was clearly and unambiguously advised in my judgment, released on March 20, 2024, at paragraph 41, that I would receive written submissions as to costs, and that Mr. Fiorini's submissions were to be provided by April 18, 2024. I have taken Mr. Fiorini's email into account and considered it to be his submissions.
B. The Applicable Legal Principles
[5] 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".
[6] In exercising my discretion as it relates to costs I am required to consider the matters described in Rule 57.01 of the Rules of Civil Procedure. 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;
f) whether any step in the proceeding was, (i) improper, vexatious, or unnecessary ...
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.
[7] 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."
[8] 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., 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.
[9] The guiding principle that governs whether costs should be awarded on a substantial indemnity basis was described in Davies. The Court of Appeal, at para. 40, emphasized that substantial indemnity costs should only be considered where there is a "clear finding of reprehensible conduct on the part of the party against which the cost award is being made" that is deserving of sanction.
C. Should costs be awarded on a substantial indemnity basis?
[10] The respondents submit that substantive indemnity costs are appropriate in the present case because Mr. Fiorini used the application as an abusive vehicle for retaliation. They advised Mr. Fiorini when he initiated the application that they would seek substantial indemnity costs for this reason. In my judgment, I noted that the timing of the application, which was initiated weeks after Ms. Pikula sued Mr. Fiorini's wife in an unrelated dispute, suggested that it was brought as a retaliatory legal proceeding. Because Mr. Fiorini refused to answer proper questions at his cross-examination about his motivation in bringing the application, I infer that his motivation for bringing the application was as alleged.
[11] My conclusion that Mr. Fiorini's conduct in bringing the application was abusive does not rest solely on the timing of the application and his refusal to answer questions about his motivation. The application was devoid of merit. In my decision dismissing the application, I found that there was no credible or reliable evidence to support the application. I rejected Mr. Fiorini's affidavit evidence as not credible.
[12] Mr. Fiorini abused the court's process to harass the respondents. He attempted to summons Mr. Malanca's parole officer, for no legitimate reason related to the factual issues in the application. That could only have been an attempt to intimidate Mr. Malanca. Mr. Fiorini also made unsubstantiated allegations of wrongdoing against the respondents about matters that were irrelevant to the application.
[13] The day after the application was commenced, Mr. Fiorini contacted the court and obtained a date for the hearing of an injunction application three weeks later. He did this without consulting the respondents. There was no viable basis for an injunction to be issued. Mr. Fiorini did not respond to a letter from the respondents seeking an adjournment and a mutually agreed-upon timetable. An appearance before Vallee J. ensued, at which time the application was adjourned on consent and a timetable set. The only reasonable explanation for why Mr. Fiorini proceeded as he did is that he used the application to apply pressure to, and to harass, the applicants.
[14] I find that Mr. Fiorini engaged in conduct that is deserving of sanction by bringing a meritless application for an improper purpose, and then conducting that application in an abusive manner for the purpose of harassing the respondents and causing them to incur needless expense.
[15] This is an appropriate case for substantial indemnity costs.
D. The appropriate quantum of costs
[16] The bill of costs provided by the respondents generally supports the quantum of costs sought, given the experience of the lawyers for the respondents, as well as the rates charged, and the hours spent by those lawyers, subject to one exception. I accept Mr. Fiorini's submission that the attendance of two lawyers at the cross-examinations, and at the hearing of application and preparation for hearing of the application was not necessary. Mr. Fiorini was self-represented, and his application was devoid of merit. The attendance of two lawyers was disproportionate to the issues raised by the application. I will reduce the costs award accordingly.
[17] I accept that Mr. Fiorini would reasonably have expected to pay costs in the range sought by the respondents.
[18] The relief claimed by Mr. Fiorini was significant. He claimed an interest in a property worth at least $8,000,000, and also sought relief that would have interfered with the property owner's conduct of its business. A vigorous defence of the application was to be expected.
[19] The proceedings were somewhat complex, and made more so by the variety of relief sought by Mr. Fiorini.
[20] The issues were of the utmost importance to the respondents.
[21] Mr. Fiorini's conduct tended to lengthen the proceedings unnecessarily. His conduct during cross-examinations was combative and evasive. His cross-examination took much longer than it should have because of his conduct. He raised irrelevant issues that detracted from a focused hearing.
[22] Mr. Fiorini unilaterally scheduled an injunction motion shortly after serving his notice of application. Although it did not proceed, it required a response, and necessitated a court appearance. This was improper and unnecessary.
[23] Mr. Fiorini's refusal to answer relevant questions at his cross-examination and his evasive and combative approach to cross-examination needlessly increased the duration of the cross-examination.
[24] I am satisfied that the costs incurred by the respondents as described in their submissions are generally fair and reasonable, subject to the adjustment necessary to reflect an element of over-lawyering. The costs claimed reflect the experience of counsel for the respondents, their hourly rates and the hours spent by them to respond to the application, the amount claimed in the proceeding, the complexity of the proceeding and the fact that it was of importance to the parties, and the conduct of Mr. Fiorini.
E. Conclusion
[25] I conclude that it is fair and reasonable for Mr. Fiorini to pay costs on a substantial indemnity basis in amount of $70,000, inclusive of disbursements and HST, and order that he pay that amount within 30 days of the release of this decision.
Justice Jocelyn Speyer
Released: May 17, 2024
COURT FILE NO. CV-23-1105-00 DATE: 2024-05-17 ONTARIO SUPERIOR COURT OF JUSTICE
Nicholas Fiorini
- and- Alfredo Malanca and Katarzyna Pikula and 197 McKay BaiTie Corp
DECISION AS TO COSTS
J. SPEYER J.
Released: May 17, 2024