Mariora Flaminzeanu v. Toronto Transit Commission
COURT FILE NO.: CV-16-00545315-0000
DATE: 20240508
SUPERIOR COURT OF JUSTICE – ONTARIO
RE: Mariora Flaminzeanu
AND:
Toronto Transit Commission
BEFORE: MA Sanderson, J.
COUNSEL: Jeffrey Strype and Rajwant Singh Bamel for the Plaintiff
Robert Zigler and Nabil Mahmood for the Defendant TTC
HEARD: in writing and orally March 15, 2024
REASONS FOR DECISION ON DETERMINATION OF FLAMINZEANU COSTS
Introduction and Background
[1] These Reasons are about costs of tort action CV-16-005453-0000 payable to the plaintiff by the defendant TTC. They have been prepared pursuant to the direction of D Wilson J [as she then was], dated September 21, 2023, that I should fix these costs.
[2] Although much is hotly disputed, one thing is clear: When this case settled on April 22, 2023, two days before the commencement of a scheduled jury trial in this matter projected to last 20 days, counsel for the TTC agreed to pay the plaintiff’s costs of this action.
[3] The parties here disagree vehemently on almost everything else related to these costs, including the amount of the settlement relevant in the fixing of the costs here.
[4] They disagree on the method of determining these costs.
[5] The appropriate official to determine these costs is in dispute.
[6] I have quoted extensively verbatim from the submissions herein to convey the flavour of this dispute.
[7] The plaintiff has submitted two Bills of Costs dated June 2023 and February 2024.
[8] In the February 2024 version at page 27, the plaintiff seeks partial indemnity fees of $663,784.55 plus HST of $86,291.99 [$750,076.54] based on actual fees of $1,153,963.91 plus disbursements of $147,136.84 plus HST of $13,721.94 [reduced at p 6 of written costs submissions to $140,000] plus, at page 32 post settlement substantial indemnity fees of $48,225 plus HST of $6,269.25=$965,429.57.
[9] In reply submissions at page 8, the plaintiff seeks partial indemnity costs of $935,497.80 plus $35,829.56 interest for a total of $971,327.36 [based on 65 % of actual fees of $1,021207.00] on an overall settlement of $650,000.
[10] In general, counsel for the TTC submits [at paragraph 12] that the plaintiff’s claims for costs are “grossly excessive” and “not in keeping with the principles of assessment of costs in similar cases.”
[11] The TTC submits [at paragraph 13 of its written costs submissions] that reasonable partial indemnity fees here would be $75,000 plus HST and reasonable disbursements would be $125,000.
Plaintiff’s Dockets
[12] Counsel for the plaintiff has produced and filed on Caselines about 40 pages of dockets [about 30 entries per page] from April 5, 2014 - June 1, 2023.
[13] I have referred extensively in these Reasons to the plaintiff's dockets.
Background
[14] The Plaintiff Marioara “Maria” Flaminzeanu was born on December 7, 1940.
[15] At the time of the settlement in April 2023, she was 82 years old.
[16] She is now 83.
[17] On February 27, 2014 when Maria was 73 and a pedestrian, she was struck by a TTC bus.
[18] An Accident Benefits claim was started shortly thereafter.
[19] Counsel for the plaintiff refers to the Accident Benefits provider as TTC AB.
[20] Counsel for the TTC refers to the Accident Benefits provider as TTCICL
[21] The tort action herein was started in January 2016.
[22] A Statement of Defence was filed in April 2017.
[23] The parties dispute the seriousness of Maria’s injuries caused by the TTC bus.
[24] The plaintiff’s position in this litigation to the date of settlement and on the costs motion was that prior to the TTC bus accident, Maria was living independently and enjoying her life.
[25] Before her semi-retirement she was an economist in Romania.
[26] At the time of the bus accident, she was still working 3 days a week in Canada as a French teacher.
[27] Her injuries in the bus accident dramatically and permanently ruined the rest of her life.
[28] After the accident Maria’s condition deteriorated to the extent that by 2020, in the Accident Benefits matter, she had been designated catastrophically impaired.
[29] Discoveries were held in the tort action in 2017 and 2018.
[30] The TTC takes the position that by the time of the discoveries the plaintiff had recovered well and was cognitively fine.
[31] Counsel for the plaintiff takes the position [paragraph 25 responding submissions] that at the time of the discoveries Maria was suffering from agnosia /anosognosia... Given the severity of her cognitive impairment she lacked awareness of her severe deficits so that many of her statements at her discovery were inaccurate. [see Dr Mitchell Report September 9, 2022, p14 of 89]. Her daughter Diana would have given evidence at trial had the tort trial gone ahead that her mother was far more disabled than she represented herself to be at her discovery.
[32] Counsel for the plaintiff has submitted that throughout the tort action up to the courtroom door and during this costs determination, the TTC has deliberately delayed its course.
[33] At paragraph 9 of the plaintiff’s Bill of Costs: Throughout the nine years of litigation there was no attempt by the TTC to settle this claim. Notwithstanding that the Insurance Act requires the parties to this type of litigation to attempt meaningful settlement discussions, the TTC would not participate or respond to the plaintiff’s offers of settlement in any way, notwithstanding the age of the Plaintiff and her medical needs after the accident.
[34] At paragraph 13: Historically there had been significant issues with TTC AB not paying for treatment that had been approved and incurred and or initially denying treatment and later accepting same. This created a major health issue for the elderly plaintiff whose condition required not just 24/7 attendant care but active PSW and RSW daily care. The plaintiff’s condition over the many years as a consequence of the delays progressively deteriorated….
[35] At paragraph 39: The defendant, in our submission, defended this case with a view to extending the litigation such that the plaintiff would not survive the delay in having her day in the court.
[36] Counsel for the TTC has denied the plaintiff’s allegation of deliberate delay.
[37] At paragraph 54: There is no evidence of delay on the part of the TTC. The statement at paragraph 39 of the plaintiff's costs submissions that the TTC wished to delay the date so that the plaintiff passed, is outrageous, pejorative and prejudicial.
[38] At paragraph 49: Following the examinations for discovery a mediation date was agreed upon for March 13, 2019. However, a few days prior, the plaintiff requested an adjournment This adjournment request is in stark contrast to the allegation that the defendants caused multiple adjournments of the mediation.
[39] The parties disagreed as to why the mediation in the tort action was cancelled in March 2019 and why it was delayed to June 23, 2020.
[40] It appears from them that Maria’s condition was deteriorating in March 2019.
[41] As of March 13, 2019, counsel for the plaintiff was already considering seeking a Catastrophic designation in the AB matter.
[42] By May 2019, counsel for the plaintiff had received a CAT assessment report from Dr Kurzman.
[43] Counsel for the plaintiff was also concurrently obtaining liability and damages evidence for the tort trial.
[44] In March 2020 counsel for the plaintiff JB noted difficulties with TTC adjuster re payments and treatment.
[45] On May 28, 2020 J S wrote on his docket: File review prep on damages reviewing each heading and building fact support for each claim…
[46] A mediation had been scheduled for June 23, 2020, and in the spring of 2020 preparation for the upcoming mediation was ongoing.
[47] The TTC submissions at paragraph 52: In and around that time ICL as part of its adjustment of the file undertook a number of assessments to determine if the plaintiff met the designation of catastrophic impairment…
[48] The Seiden Health documents from the SABs file on Caselines include several reports addressed to Thilak Vigneswaran at the TTC from catastrophic assessors, including Dr Ricki Ladowsky Brooks, Ms Hadassah Lebovic OT, and Dr Bruce Paitich about assessments they conducted of Maria in November 2019.
[49] It appears there was an almost 7-month delay between these assessments and the delivery of each of the reports dated June 2020.
[50] In the plaintiff’s dockets dated June 22, 2020, [the day before the mediation], plaintiff’s counsel JB wrote: claim probably won't settle. TTC simply wants to wait until she dies.
[51] The mediation proceeded on June 23, 2020.
[52] For the Mediation on June 23, 2020, SD docketed 8 hrs, AN docketed 8 hours, JB 8.6 hours, JS 7.7 hours.
[53] On July 7, 2020, plaintiff's counsel JS wrote on his docket: updates of medicals and neurology opinions-mediation a total waste of time and effort...
[54] 2020-07-24 put together tr [trial record] for tort.
[55] On July 27, 2020, the plaintiff set the tort action down for trial.
[56] I note that the defence CAT Seiden Health report result compiling the June reports mentioned earlier was not communicated to the plaintiff until August 18, 2020, almost 2 months after the mediation.
[57] On August 18, 2020, [Caselines B-1760] a letter on TTC letterhead was sent to the plaintiff and her counsel enclosing those Seiden Health reports, advising that it had been decided that Maria met the definition of Catastrophic Impairment and qualified for $1,000,000 of Medical Rehabilitation and $1,000,000 of Attendant Care Benefits. The letter was signed by Samantha Della Camera of the TTC Insurance Company Ltd.
[58] On August 20, 2020 – on his docket JS wrote “now that client has been accepted as CAT, we need to ensure we are getting max for client on AB…”
[59] By this juncture, the Ontario Court of Appeal had already decided Cadieux v Cloutier 2018 ONCA 903 on December 23, 2018, and counsel for all parties would have understood by that date that at the upcoming tort trial, counsel for the plaintiff would be required to prove all Maria’s damages on a gross basis.
[60] The TTC would have understood by then that if liability were established at the tort trial against the TTC, the TTC [not TTC AB /TTCICL] would be required to make an immediate lump sum payment of past and future damages to the plaintiff [after s 267 Insurance Act deductions and assignments were made as set out in more detail later in these Reasons.]
[61] The plaintiff’s September 9, 2020, docket contains the following entry made by lawyer: JB- Case is probably going to trial with a jury so we should be completing witness status and fact and decision tree.
[62] On Plaintiff’s 2020-11- 24 docket: … no point in further settlement meeting as TTC wants to wait p[laintiff] out so they don’t have to pay. Continue work on trial prep… Don’t think we can call p[laintiff] as she is no longer competent.
[63] In November of 2020 there was correspondence regarding Maria’s housing needs.
[64] On 2020-12-23 SD wrote - client deteriorating with bad care - need to try to improve her environment…
[65] On 21-02-09 the plaintiff scheduled the tort trial for June 22, 2022.
[66] 2021-03-02…. begin prep of jury trial opening witnesses to be called - instructions to staff jury motion - client can't be called so discuss with d[aughter Diana] her role...
[67] 05-28 2021 – daughter Diana called to complain about level of care.
[68] SD - 2021 04 09 JS continued work on trial prep with liability emphasis and... defence claim update with JB working on file over a number of days.
[69] April - May 2021 given CAT determination… update all treatment providers for max usage of care so we can support the tort claim for care - discussion of AB claim - D[aughter] called to update and complain of the level of care from service provider s- they don’t show up or quit. Very difficult to provide care in tiny apt. A housing review was noted.
[70] It is clear from the dockets that throughout this period, the plaintiff’s preparation for the tort trial was ongoing.
[71] It is also clear that counsel for the plaintiff recognized that in the preparation of the tort action, all damages needed to be proven on a gross basis, [including all damages that the TTC could be required to pay immediately after the tort trial but might eventually be able to recover back pursuant to an assignment of AB Benefits.]
[72] The plaintiff’s dockets include an entry - 21-05-28 - we have to update treatment providers so we can support tort claim for care…
[73] The tort trial had been scheduled for June 22, 2022.
[74] Counsel for the plaintiff submitted that up to February 2022, the TTC had raised no causation issue. The parties had agreed that all defence reports were to be served by October 21/2021.
[75] In February 2022 the TTC retained a Dr Yufe to do an assessment of Maria by Zoom and served his report that included his opinion that Maria’s dementia was not caused by the TTC bus accident [Caselines B1-763]
Pretrials
[76] Shortly before the scheduled June 2022 trial date, there were two pretrials before J Wilson J.
[77] At the first pretrial, Justice Wilson noted “The case should be resolved both in tort and accident benefits as soon as possible”.
[78] At para 42 of the TTC costs submission: The Accident Benefits adjuster participated in the first pretrial but later refused to discuss any resolution and advised Justice Wilson that the court had no power or authority to seek their cooperation towards a resolution of the Accident Benefits or the tort claim.
[79] At Paragraph 59 of the TTC written cost submissions: Notwithstanding the desire of Wilson J to have the AB adjuster contribute some lump sum to resolve this case, they refused. They did not refuse to provide benefits, just to make a lump sum contribution.
[80] At para 43 of the TTC costs submission: A second pretrial took place on May 24, 2022, again before Justice Janet Wilson… Justice Wilson noted as follows: The plaintiff presently has full time attendant care Monday to Friday at a cost of $4,500 per month with family stepping in to assist with the balance of care. The plaintiff is not using the maximum available of $6,000 [per month] for attendant care. It appears that the care burden is very stressful for the family and needs to be increased. This issue needs to be addressed promptly and before a trial…
[81] At para 37 of the plaintiff’s written cost submissions: The pretrial judge Justice Janet Wilson asked the TTC AB adjuster to pay for appropriate accommodation. The TTC AB refused to provide payments until December 21, 2022.When payment for accommodation was finally made it was made under attendant care, not medical rehabilitation, which frustrated the attendant care providers. The TTC never provided the 24/7 attendant care she needs.
[82] The plaintiff submitted in its further submissions on costs at paragraph 5 (b): … in sum the Accident Benefits claim was constantly delayed by TTC’s adjuster, resulting in constant loss of unpaid service providers, putting the Plaintiff at serious health risk (unlike Cadieux and most Accident Benefit/tort cases, the Accident Benefits and tort claims were against, for all intents and purposes, the same company, ICL, being a wholly owned subsidiary of TTC) TTC’s lawyer Laura Qaqish was provided with the plaintiff’s consent to represent both tort and accident benefits which would have been a clear conflict if TTC and ICL were legally separate. Ms Qaqish never declared a conflict of interest to the plaintiff…
[83] On May 28, 2022 Dr Yufe prepared an addendum report.
[84] It was necessary for the plaintiff to retain Dr Mitchell to address Dr Yufe’s report.
[85] The June 2022 trial was adjourned.
[86] Counsel for the TTC submitted at para 63: The trial did not proceed because the plaintiff requested an adjournment.
[87] At paragraph 136 of the TTC submissions: In June 2020 Mr Strype requested an adjournment because the court did not have enough time to complete the expanded trial.
[88] Counsel for the plaintiff submitted that the adjournment of the trial in June 2022 would not have been necessary had the TTC met the agreed timetable, and had it not late served the report of Dr Yufe. The evidence of Dr Yufe made the booked time for the June 2022 trial insufficient. In other words, it was the TTC that necessitated the adjournment of the June 2022 trial.
[89] In her report dated September 9, 2022 Dr Mitchell disagreed with Dr Yufe and opined that Maria’s cognitive decline was caused by the TTC bus accident.
AB Payments Increased
[90] By December 2022 Maria was receiving $6,000 monthly in AB payments for attendant care and also AB payments for medical care
Tort Liability
[91] Before April 22, 2023, the parties had not agreed on liability for the February 27, 2014 accident.
[92] Counsel for the plaintiff was submitting, based on expert evidence, that the TTC bus accident was caused by the negligence of the TTC bus driver, with no contributory negligence of the plaintiff.
[93] Counsel for the TTC was taking the position, based on expert evidence, that the TTC bus driver could not have avoided striking the plaintiff and that her action against the TTC should be dismissed.
Damages in Tort
[94] The parties did not agree on the quantum of the plaintiff’s damages in tort although they agreed that she was incapable of caring for herself.
Possible Tort Trial Outcomes
[95] Counsel for the plaintiff had an expert opinion quantifying her future care costs as of April 29, 2022 [Caselines A6589] at $6,026,494.
[96] Depending on the jury’s findings on liability, causation, level of care needed and Maria’s life expectancy, had the matter not settled before the tort trial, at the tort trial the jury could have assessed Maria’s gross damages ranging from 0 to several million dollars.
[97] Had the matter proceeded to trial and the jury accepted the plaintiff's expert evidence on liability, causation and damages, the TTC could have immediately been required to make a large lump sum payment to Maria.
Tort Trial Preparation
[98] By April 22, 2023 the plaintiff’s trial preparation had been extensive.
[99] The plaintiff had twice been all prepared for the trial to start.
[100] There had been 6 pretrials before three different judges.
[101] Before April 22, 2023, the TTC had made no settlement offers beyond $60,00 to settle the tort action.
[102] Counsel for the plaintiff had offered to settle for $1.6 million.
[103] On April 24, 2023 the tort trial was scheduled to go ahead before Dow J. for 20 days.
The Settlement
[104] Counsel for the parties met on the Saturday April 22, two days before the trial was scheduled to start.
[105] They reached a settlement at that Saturday meeting.
[106] When counsel were still meeting, they contacted me to advise that they had settled and to ask me to please let Justice Dow know that the trial would not be proceeding.
Post Settlement Developments
[107] In late May 2023, all counsel asked me to sign a form of judgment on consent .
[108] I complied with their mutual request.
[109] Later yet, counsel for the plaintiff sought to convene a case conference before me about a disagreement that had arisen between the parties with respect to how the costs the defendant had agreed to pay to the plaintiff would be determined.
[110] Counsel for the plaintiff contended that Ms Qaqish/the TTC had agreed that ADR Chambers would determine the quantum of the costs and he wished to bring a motion to enforce that agreement.
[111] By then, Mr Zigler who had replaced Ms Qaqish as counsel for the TTC would not accede to that request.
[112] A case conference was then convened before the head of the civil team in Toronto, D Wilson J.
[113] After meeting with counsel and hearing their submissions, D Wilson J prepared the following endorsement:
This is a tort action that was fixed for trial to commence April 24, 2023.The pretrial judge was Justice Sanderson There were several attendances with Justice Sanderson. Two days before the trial was to start counsel settled the case for the sum of $650000 plus costs. The plaintiffs take the position there was an agreement to have the costs fixed by ADR Chambers. The Defendant disputes this and submits that in the absence of consent between counsel the Plaintiffs must assess their costs before an assessment officer of this Court.
In my capacity as the team lead for trials and pretrials in Toronto a case conference was sought which I convened today. I do not agree that a motion to enforce an agreement is the appropriate route on the issue of costs. The injured plaintiff is elderly and given that the tort action is settled, the costs should be dealt with as quickly and efficiently as possible. I do not agree that having an assessment officer assess the costs is the best option. In Toronto dates for assessment of costs are very delayed and it is unlikely that an appointment could be secured before 2025.In my view the costs should be fixed by a judge, and given Justice Sanderson’s familiarity with the case, in my opinion she is the judge who is best situated to deal with the costs issue. I direct that she shall convene a case conference to set a timetable for the delivery of materials.
TTC’s Motion for Leave to Appeal to Divisional Court
[114] Following the order of D Wilson J., there was a further delay because the TTC then sought leave to the Divisional Court to appeal her order.
[115] At paragraph 10 of its motion for leave dated November 2, 2023, counsel for the TTC included the following: There is good reason to doubt the correctness of the Order Directing a Reference to fix the costs of the within action to Sanderson J and in particular: (g) The case conference judge’s conclusion that a reference be directed to Sanderson J, as Rule 50.09 and the prevailing case law precludes a pretrial judge from hearing a reference in the same proceeding.
[116] Counsel for the TTC submitted at paragraph 33: Having presided over the pretrial in the within action the pretrial judge is already privy to statements made at the pretrial. The order directing a reference to the pretrial judge undermines the purpose of pretrials as set forth in Rule 50.01 and conflicts with the reasoning in Gdanski.
[117] At paragraphs 50 and 51 counsel for the TTC cited Rules 50.09 and 50.10.
[118] At paragraphs 52 and 53: “It is analogous that the pretrial judge is prohibited from hearing the reference on costs because Rule 50.09 not only prohibits communications regarding matters at a pretrial at a subsequent motion but also at a subsequent reference. The Order in question concerns a reference to a pretrial judge to fix costs and as such conflicts with the Court of Appeal’s decision in Royal Bank v Hussain 2016 ONCA 637.The Case Conference Judge recognized that the pretrial judge had familiarity with the case, but it was that very familiarity that should have precluded Justice Sanderson’s involvement.”
[119] Counsel for TTC submitted at paragraph 55: The Order also conflicts with the Superior Court’s decision in Gdanski v Calico Medical 2013 ONSC 2484 which concerned parties referring to statements made at pretrial in costs submissions. Justice Broad found that “any reference to statements made at the pretrial in costs submissions serve to undermine the purpose of pretrials set forth in Rule 50.01.
[120] Counsel for the Plaintiff submitted at paragraph 67:.at the pretrial the question of costs was not discussed at all between the parties and the pretrial judge Justice Sanderson is not prejudiced in deciding this matter directly. The action has now been settled with the costs issues remaining to be decided.
Decision of the Divisional Court
[121] On December 8, 2023, the Divisional Court dismissed the TTC’s motion for leave to appeal the order of D Wilson J.
Fixing the Costs
[122] The TTC having squarely submitted that Justice D Wilson was wrong in directing me to fix costs and that I was without jurisdiction to follow her direction, and the Divisional Court having dismissed the leave motion, I then started to comply with her direction by requesting counsel for the parties to agree on a timetable for the fixing of the costs.
[123] They did not do so quickly, and when I asked why, counsel for the TTC advised me that the Divisional Court decision had not changed the TTC’s position and that the TTC would be bringing a motion seeking my recusal.
Motion for My Recusal
[124] The TTC’s motion is filed at Caselines at B1806
[125] Counsel for the TTC then asked me to delay the fixing of the costs to accommodate the hearing of its motion seeking my recusal.
[126] Based on the decision of the Divisional Court, I refused to further delay the scheduling of the costs motion until after this motion had been heard, but I advised counsel for the TTC that he was free to make, and I would consider his written costs submissions as to why I should recuse myself.
[127] Given the continuing resistance of the TTC to D Wilson J’s direction that I fix the costs, I also asked all counsel whether they would prefer to consent to a variation of Wilson J’s order, given latest information that an early assessment before an assessment officer could be obtained.
[128] However, consent was not forthcoming.
[129] In written costs submissions, at paragraph 14, the TTC continued to object to my fixing of the costs because I was a pretrial judge in this matter.
[130] At para 15, counsel for the TTC submitted that I cannot [i.e. I have no jurisdiction to] preside over any substantive matter between the parties as a consequence of Rule 59.09 and 59.10. Counsel for the TTC cited Royal Bank v Hussain 2016 ONCA 637 and Gdanski v Calico Medical 2013 ONSC 2484.
CONCLUSION ON TTC RECUSAL REQUEST
[131] After the written submissions according to the timetable I had set had been received, I reconsidered the recusal issue including the TTC’s written cost submissions as to why I should recuse myself.
[132] In my view, there was nothing new in the written costs submissions on my jurisdiction.
[133] Given the Divisional Court’s earlier rejection of arguments that I am without jurisdiction to fix the costs, the parties having refused to consider consenting to seeking a consent variation of Wilson J’s order and the lack of new arguments, I was of the view that my jurisdiction/power to fix the costs as directed by my team leader was clear.
[134] That left whether I should exercise my discretion and recuse myself, not because I was required to do so, but because one of the parties had so requested.
[135] I considered the following: (a) Counsel for the TTC has not in its oral or written costs submissions contradicted the plaintiff’s assertion that there was never any discussion of information confidential or otherwise at any of the pretrials or subsequent case conferences where I was present about the amount of the costs the TTC should be required to pay. (b) It is clear that the TTC agreed in my absence to pay costs as part of the substantive settlement. (c) Judges are often asked post settlement to deal with such matters in the interest of efficiency. (d) Counsel for the TTC has not suggested that pretrial judges are precluded from participating in Rule 7 type approval processes and in fact requested and consented to my approving the judgment here. (e) I was directed to fix these costs by my team leader
Disposition on TTC’s Recusal Request
[136] I see no unfairness or prejudice to the TTC sufficient to warrant my voluntary recusal.
[137] Given the retirement of J Wilson J, and the advanced age of the plaintiff, making further delay especially unacceptable, I agree, in the spirit of Rule 57.01(7) that I am the judge best situated to fix costs, given my familiarity with the general contours of this case/information on “some general parameters that are borne out by the record before the court” to use the words at para 35 of the TTC submissions.
[138] Nothing in the TTC’s written or oral submissions has caused me to reverse my earlier tentative decision not to recuse myself.
[139] I therefore will not do so.
Lack of Sworn Evidence
[140] Counsel for the TTC in its written cost submissions has expressed the concern that if the matter proceeds before me it should not be decided in a summary proceeding “with no evidence under oath.”
[141] At paragraph 22: “It is the defendant's submission that while a judge fixing costs may do so in a summary fashion, the court ought not to run roughshod over the substantive and procedural rights of a party.”
[142] At paragraph 23: “Thus, where there are assertions of fact that are not admitted, more than just a bald statement in a submission is needed. There should be some documentary corroboration if possible.”
[143] At paragraph 24: “The defendant specifically does not admit and in fact disputes the facts alleged in terms of settlement and the discussions surrounding settlement”.
[144] As I was not present, I cannot be sure what was discussed at the April 22, 2023, meeting.
[145] Both counsel representing the plaintiff on the costs submissions Mr Strype and Mr Bamel were present.
[146] On these costs issues, the TTC is now represented by Mr Zigler, not by Ms Qaqish. Mr Zigler was not present at the April 22, 2023 settlement discussions and he objects to counsel making submissions not under oath on what happened at the April 22 settlement meeting.
[147] I note that Ms Qaqish has played no visible role in helping to shed light on the matters raised by the TTC.
[148] I also note that counsel for the plaintiff’s assertion that Ms Qaqish still works for the TTC went unchallenged.
[149] Yet the TTC has proffered no affidavit evidence from Ms Qaqish despite its insistence that the costs issues should not be decided only on documents filed and written submissions.
[150] Likewise, Mr Anderson a TTC director also present at the April 22,2023 meeting has taken no visible role in the post April 22, 2023, dispute on costs. No affidavit of Mr Anderson has been filed by the TTC.
[151] On related motions the TTC has attempted to proffer affidavit evidence from Chad Townsend, a TTC lawyer who was not at the April 22, 2023 meeting either.
[152] In Estate of Diane Tsialtas v Monroe 2022 ONSC 1207, after the plaintiff accepted the defendant's settlement offer, Daley J was tasked with fixing the costs. There was no sworn evidence in that case before he made that costs determination. Daley J decided the costs issue on a record similar to the documentary evidence put before me here on Caselines.
[153] In Bondy Rafael 2019 ONCA 1026, counsel appeared before a motion judge to have the plaintiff’s costs fixed. They filed a brief prepared by plaintiff’s counsel including counsel's dockets, medical reports and clinical records in relation to the injuries suffered by the plaintiffs, as well as four experts reports on liability. There was no cross examination or evidence called at the hearing of that costs motion. This approach was not criticized by the Ontario Court of Appeal. See also Diemas v Novotech Technologies Corp 2021 ONSC 3594.
[154] I do not give effect to the objection of the TTC that evidence under oath must be proffered here.
The Amount of the Settlement Upon Which Costs are Payable
[155] There is no doubt that the TTC agreed to pay the plaintiff’s costs. As set out in paragraph 5 of the Minutes of Settlement: “The TTC agrees to pay the plaintiff legal costs disbursements and HST as assessed or agreed” As set out in the consent Judgment at: paragraph 4: it is further ordered and adjudged that the plaintiff shall receive costs, disbursements and HST as assessed or agreed upon.
[156] While there is no disagreement on whether the TTC agreed to pay the plaintiff’s costs, there is disagreement on whether TTC agreed to pay costs proportional to a $100,000 tort settlement or a $650,000 global settlement.
[157] The TTC submitted at paragraph 82 of its written costs argument: The minutes clearly state that the tort settlement is for $100,000 and not the $650,000 that the plaintiff continuously asserts.
[158] At para 159 of the TTC submissions: The TTC had what it felt was a strong liability defence and it was also asserting a reasonable causation defence. It had taken this position throughout the litigation. The $100,000 settlement perfectly balanced the potential damages, the cost of trial and the possible liability.
[159] At Para 160: Therefore, it is necessary to consider the settlement for the action based on the $100,000 tort contribution to the settlement. This is in keeping with the Minutes and the surrounding circumstances.
[160] At paragraph para 161: It is imperative that the Accident Benefits settlement not be considered in assessing proportionality. That is because the costs related to that claim are not as a matter of course included in the assessment of costs in accordance with the Court of Appeal in Cadieux... Including the SABs settlement amount as relevant would be tantamount to including the Accident Benefit costs indirectly when it cannot be done directly.
[161] At para 121: On the strength of the Court of Appeal in Cadieux v Cloutier the Plaintiff ought not to be entitled to any costs related to the accident benefits.
[162] At para 162: Further, if the TTC was simply going to increase its costs liability by cooperating with the plaintiff so that ICL would contribute to the settlement then it would not be incentivized to do so. What incentive would there be for TTC to include a contribution from ICL if all it did would increase its liability for costs?
[163] At para 163: There is no principled reason that the Accident Benefit Contribution should be considered in the assessment of costs in this tort litigation.
[164] In their written submissions and in oral argument, counsel for the plaintiff were palpably indignant at these submissions made by counsel for the TTC to the effect that this Court should only consider a $100,000 settlement amount fixing costs here.
[165] Counsel for the plaintiff submitted that at the settlement meeting counsel for the TTC agreed to pay costs to the Plaintiff on a settlement of $650,000.
[166] In their written costs submissions, counsel for the Plaintiff wrote at paragraph 15: the plaintiffs understanding was that this settlement for $650,000 was negotiated with tort counsel on the eve of the tort trial to settle all claims along with any accident benefits representing a collateral deduction on the tort side.
[167] Paragraph 16 of the plaintiffs written costs submissions included the following: TTC subsequently circulated a Settlement Disclosure breakdown for their purposes showing the payment from TTC AB at $550,000. Now TTC suggests that because the AB settlement was $550,000 and the tort settlement was $100,000, the legal costs payable for plaintiff’s 10 years of work should be proportionate to a settlement of $100,000, which was not the settlement.
[168] In making its submission that the TTC agreement at the settlement meeting to pay costs extended only to $100,000 of the settlement, the TTC relies heavily on the content of the Minutes of Settlement.
[169] The Minutes were not executed at the settlement meeting on April 22, 2023.
[170] Their wording changed between April 22, 2023, and May 3, 2023, when the Minutes were executed by the parties.
[171] The earliest disagreement centred on whether ADR Chambers was to fix assess the costs that the TTC had agreed to pay.
[172] The earlier draft included the following: The parties by their solicitors agree to settle the within action and accident benefit entitlement on the following terms and that judgment be granted accordingly…(1) The defendant Toronto Transit Commission agrees to settle the plaintiff’s tort claim on a full and final basis for $100,000 inclusive of pre -judgment interest and all claims in respect of injuries arising from the motor vehicle accident of February 27, 2014. The plaintiff agrees to sign a release in the form approved by the TTC (2) upon receipt of the executed release TTC agrees to pay $100,000 within 30 days… (3) TTC Insurance Co Ltd agrees to settle the plaintiff’s accident benefit claim [EV20141701] for $550,000, inclusive of all entitlements and any claims, including past, present and future against TTCICL. The plaintiff agrees to sign a Statutory Disclosure Notice and release in the form approved by TTCICL. Upon receipt of the executed Statutory Disclosure Notice and release, TTCICL agrees to pay the settlement amount within 30 days (4) TTCICL agrees to pay any outstanding benefits approved on or before April 22 2023. The parties agree TTCICL will not pay for any benefits submitted or incurred after April 22, 2023 (5) The TTC agrees to pay to the Plaintiff legal costs disbursements and HST as assessed by ADR Chambers [emphasis added]
[173] The Minutes of Settlement as executed May 3, 2023 [at Caselines A174] upon which the TTC relies, went unchanged from the first draft in paragraphs 1, 2, 3, 4 except with respect to payment details not at issue here. They refer to a tort settlement with the TTC for $100,000 and an AB settlement with TTCICL for $550,000 subject to court approval with respect to claims of Maria Flaminzeanu and that judgment be granted accordingly (1) TTC settles for $100,000 with release and on release TTC will pay $100,000 to the plaintiff’s lawyer in trust within 20 days (2) TTC Insurance Commission TTCICL agrees to settle the AB claim including past present and future claims against TTCICL (A174 CaseLines) (3) Upon receipt of SDN and executed release TTCICL agrees to pay the settlement amount in trust to the plaintiff's lawyer within 20 days.
[174] Before signing the Minutes counsel for the plaintiff said between April 22 and May 3 the TTC made a change that was not brought to his attention paragraph 5 of the Minutes was changed to read as follows: The TTC agrees to pay to the Plaintiff legal costs disbursements and HST as assessed or agreed.
[175] After the case conference before D Wilson J, the disagreement about whether ADR Chambers should fix assess the costs then evolved into a disagreement about whether or not I should do so.
[176] If I did so, in determining whether the costs payable by TTC should be proportional to a $100,000 or a $650,000 settlement, I was asked to legally interpret the wording of the settlement documents/ the executed Minutes of Settlement.
[177] Counsel for the plaintiff submitted that the TTC did not distinguish between the $100,000 tort component and the $550,000 SABs component.
[178] Counsel for the TTC relying on the parol evidence rule submitted that I should interpret the Minutes of Settlement to mean that the TTC only agreed to pay costs on the $100,000 tort settlement component.
Failure To Distinguish Between the TTC and the TTCICL
[179] In his written and oral submissions, counsel for the TTC submitted that the Tort and AB adjusters were acting independently of each other and that in its dealings with the plaintiff, the TTC consistently distinguished between the two.
[180] At paragraph 30 of the TTC submissions counsel for the TTC wrote: ICIL is not responsible for costs of the plaintiff and assertions regarding ICIL are irrelevant to plaintiff’s entitlement.
[181] At paragraph 75: The plaintiffs only assert now that the breakdown was not part of the settlement for the sole purpose of maximizing the cost assessment which is not appropriate.
Findings on Blurring of TTC and TTCICL
[182] I do not accept the submission that in the documents the TTC consistently made it clear that the TTC and the TTCICL were acting independently of each other.
[183] While at times counsel for TTC appears to have differentiated between them in dealings with the plaintiff, it is not correct to say that the TTC consistently distinguished between the two, even in the documents filed with this Court.
[184] In those documents the distinction was not always clear.
[185] By way of one example only, the Seiden Health File [Caselines A5910-5999] reports prepared for the TTC defence Catastrophic assessment were commissioned by Mr Thilek Vigneswaran of the TTC. The assessors addressed them to the Toronto Transit Commission.
[186] The Application for the CAT determination [Caselines A 6000] was addressed to Samantha Della Canera at the Toronto Transit Commission.
[187] The report on the catastrophic assessment was sent to the plaintiff on TTC letterhead [albeit signed by a representative of TTCICL]
[188] Counsel for the plaintiff asked this court to pay close attention to the wording of the consent judgment that the TTC asked me to sign as signed by me on May 25, 2023.
[189] The judgment as submitted for my signature in this action CV-16-00545315-0000 includes the following wording: (2 ) it is further ordered and adjudged that the settlement entered into for all claims for any SABs pursuant to statutory accident benefits schedule…available pursuant to a policy of insurance issued by [emphasis added] Toronto Transit Commission in the amount of $550,000 for the plaintiff Maria Flaminzeanu, a person under a disability who is represented by her court appointed guardian Diana Flaminzeanu be and the same is approved
[190] Counsel for the plaintiff submitted that in its consent, the TTC did not make at all clear the distinction it is now seeking to make.
[191] In my view, anyone reading the consent could reasonably conclude from its wording that TTC, not TTCICL had issued a policy of insurance offering AB benefits to Maria , that the TTC was liable on that policy to pay the $550,000 in SABS
Interpretation of the Minutes of Settlement
[192] In my view the words of the Minutes of Settlement read as a whole in their natural and ordinary meaning do not clearly and unambiguously limit payment of costs to costs only in connection with the $100,000 component of the settlement.
[193] A reasonable person in the position of the parties at the time the Minutes of Settlement were signed would not imply such a term.
[194] Paragraph 5 that specifies that TTC will pay costs does not differentiate between the costs in relation to tort or SABs amounts in paragraphs 1, 2, 3 or 4.
[195] The Minutes refer to both the $550,000 and the $100,000 payments and to payment of costs without differentiation.
[196] I do not accept the TTC submission that paragraph 5 unambiguously restricts payment of costs to the plaintiff only in connection with the $100,000 component of the settlement
[197] I do not accept that I should conclude from the wording of the Minutes of Settlement that the TTC only agreed to pay costs to the plaintiff in respect of $100,000.
[198] I accept that at the time the settlement was reached the plaintiff understood that both Maria’s tort and AB claims were being included in a global settlement, but in all the circumstances here that fact was not in itself indicative that the TTC did not agree to pay the plaintiff’s costs on the SABs component of the settlement.
[199] In the overall context of this negotiation and in all the circumstances of this settlement taken as a whole, in my view a reasonable person in the position of the parties here at the time of the settlement would conclude that the TTC had good reason to agree and agreed to pay not only the plaintiff’s costs on the $100,000 tort component of the settlement but also the plaintiff’s costs of pursuing the $550,000 in SABs payments as part of this settlement because of the obvious benefits flowing to the TTC from that component of the settlement.
[200] In his written argument, Mr Zigler conceded that in some cases it may be reasonable/appropriate for a tort defendant in a tort action to pay the plaintiff’s costs of pursuing and obtaining SABs payments from the AB provider and that in some cases the court has considered it appropriate to order a tort defendant in a tort case to pay costs of pursuing SABS benefits.
[201] However, he submitted that the plaintiff has not demonstrated that the TTC had good reason to do so here.
[202] He cited Cadieux v Cloutier 2018 ONCA903, 2019 ONCA 241 as the rationale for his interpretation.
[203] In that case the Ontario Court of Appeal discussed instances when it may be appropriate for a tort insurer to pay costs incurred by the plaintiff in the tort action in recovering AB benefits.
[204] The Court wrote at paragraph 129: The court has jurisdiction under s131(1) of the Courts of Justice Act, to award “costs of and incidental to a proceeding” Legal fees and disbursements in pursuing SABs can reasonably be considered incidental to a proceeding where the SABs have reduced the damages payable by the tortfeasor.”
[205] It continued at paragraph 130: We agree with the observations of D Wilson J in Hoang and in Ryan v Rayner at para 8, that the tort defendant should not be required to pay the costs of the plaintiff’s pursuit of SABs as a general principle or as a matter of course. The issue is fact driven and depends on the particular circumstances of the case.
[206] In my view, in considering whether the Minutes of Settlement should be interpreted to mean that the TTC agreed to pay or contribute to the plaintiff’s costs of obtaining the $550,000 portion of the overall settlement, this Court should consider all the facts here, including the benefit to the TTC of an overall settlement of $650,000, and including the benefit to the TTC of the $550,000 SABs component of that settlement, and including whether the SABs have reduced the damages payable by the tortfeasor making the costs “incidental to the tort proceeding here”...
[207] In reviewing whether the TTC should pay costs on the $550,000 AB benefit to the TTC, I have considered that at the time it was negotiating the settlement on April 22, 2023 the TTC knew if it did not reach a settlement with the plaintiff before the trial, if the matter proceeded to a tort trial, at trial the Plaintiff would be required to follow the approach mentioned earlier mandated by the Ontario Court of Appeal in Cadieux v Cloutier.
[208] I have considered “The Collateral Benefits/Tort Interface Recent Developments Key Issues and Practical Strategies.” Stephen Ross and Meryl Rodriques/the Rogers Article wrote at page 6: Importantly in Cloutier, the Ontario Court of Appeal rejected the submission of the Intervenor, the Ontario Trial Lawyers Association that the plaintiffs should need only present "net” claims, such that they need not prove expenses covered by statutory accident benefits or other collateral benefits prior to trial. Counsel for OTLA submitted that such an approach would result in lengthier and more expensive motor vehicle trials.
[209] I have considered that because in Cloutier the Court of Appeal in December 2018 required the plaintiff to prove all damages at trial on a gross basis, the TTC/tort side would have understood on April 22, 2023 that if no settlement was made before trial, at the tort trial, counsel for the plaintiff would be required to prove all of Maria’s gross damages, including future damages so the jury could assess them. At trial, the plaintiff would be required to present and prove Maria’s claims silo by silo, past and future, including past and future income loss, past and future health care and care expenses, and other expected past and future pecuniary losses whether or not covered by statutory accident and collateral benefits. The jury at the tort trial would be asked to consider all of that evidence, make findings on the plaintiff’s life expectancy, lost income, care costs, medical expenses and other pecuniary losses / to arithmetically calculate them and to advise the Court of the total present value of its lump sum calculations.
[210] From those gross damage calculations/awards Sections 267.8(1)(4)(6) of the Insurance Act require deduction on a silo basis of SABs received prior to trial.
[211] Sections 267.8(9) (1) and (12) of the Insurance Act also mandate the imposition of trust and assignment obligations on a plaintiff at trial in respect of certain prescribed future collateral benefits payments with the object of avoiding double recovery or overcompensation of the plaintiff.
[212] On April 22, 2023, the TTC would have known that if the TTC/tortfeasor went to trial, once the jury assessed the future damages in a lump sum, the TTC would be required to make an immediate lump sum payment net of deductibles to Maria. The benefit of any assignment of future SABs benefits by Maria to the TTC would only be incremental and could be incomplete.
[213] As explained in the Rogers Article at page 20: “In the context of an assignment, much, if not all the risk of under compensation [to the plaintiff] is mitigated. With an assignment, the risk is shifted onto the tortfeasor [here the TTC] who, in the event that the plaintiff’s entitlement to future collateral benefits is limited or terminated, will simply not recover an offset of the damages already paid to the plaintiff... With an assignment, [as opposed to a deduction of future benefits as occurred here as a result of the April 22, 2023, settlement], it would have been the defendant TTC that would have borne the risk of non-payment if Maria died sooner than expected after a trial. Unlike before the trial, [when the value of Maria’s tort case would have been greatly diminished if she had died beforehand] if there had been a damages award at a trial the TTC, [not Maria] would have had to bear the risk of any shortfall in eventual recovery.
[214] On April 22 2023 any reasonable person in the position of the parties would have understood that if the parties settled before trial, and if they agreed on future SABs benefits payable and if the agreed SABs benefits were paid to the plaintiff immediately [as agreed here], the TTC could /would [and did] benefit not only by a reduction of damages payable by the TTC but also avoid the shifting to itself of the risk of non payment.
[215] Had the matter proceeded to a trial the tort defendant/here the TTC would not have been allowed to reap the benefit of any AB benefits windfall.
[216] In an article - Collateral Benefits - the Basics to Know When Settling a Personal Injury Claim - the author Deanna Gilbert wrote at page 14: the plaintiff of course is not required to hold in trust and or assign benefits received in future to any greater value than what the defendant paid for that corresponding head of damages.
[217] A similar issue arose in Bondy Raphael v Potrebic, in 2019, in the Ontario Court of Appeal [decided after Cloutier].
[218] The Court in that case was considering whether to uphold an order of the court below that a tort insurer after a tort trial must pay the costs of a plaintiff in pursuing SABs payments.
[219] The Court wrote at paragraph 59: In that case it was submitted that the motion judge erred in concluding that partial indemnity costs in the tort action should be based, not only on recovery in the tort action, but also on the sum of $3,007,903 recovered by the plaintiffs from their own insurer in relation to their respective statutory accident benefits claims. They reiterate that the motion judge should have restricted his analysis to the net amount recovered in the tort action and that the costs awarded were grossly disproportionate to the settlement achieved.
[220] At paragraph 60: In my view this submission depends on too narrow a reading of the motion judge’s reasons. The motion judge was clearly responding to the Potrebic’s submission at the costs motion that the amount recovered as opposed to the amount claimed is the governing factor in fixing the plaintiffs costs... the motion judge properly determined that the amount recovered is only one of the many factors he was required to consider and that a more nuanced approach was necessary in order to apply the principle of proportionality in the circumstances of this case to arrive at an amount that is fair and reasonable for the unsuccessful party to pay in this particular proceeding.
[221] At paragraph 61... he found that the plaintiff’s success in their statutory accident benefits represented a direct benefit to the defendants...
[222] The Court of Appeal upheld the court below in ordering the tortfeasor to pay partial indemnity costs to the plaintiff in connection with the plaintiff’s SABs recovery.
Disposition on the Amount on Which the TTC Should Pay Costs
[223] Here I have held that the plaintiff has demonstrated that the TTC benefited in the tort litigation from the plaintiff’s pursuit of SABs benefits in part because the SABs have reduced the damages payable by the TTC by the TTC by $550,000.Legal fees and disbursements in pursuing SABs here can reasonably be considered incidental to this tort proceeding where the SABs have reduced the damages payable by the TTC.
[224] On the evidence here, the benefit of a settlement before trial of a $650,000 tort settlement [net of a $550,000 deductible for SABs benefits agreed to be immediately deductible against what would otherwise have been an overall liability of $650,000] is clear and obvious.
[225] The benefit to the TTC is even clearer here than the benefit to the tort defendant recognized by the Court of Appeal in Bondy Rafael, given, inter alia, the foreseeable benefit to the TTC of the AB payments, the more favourable timing of the deduction [immediate v staggered over time] and the removal of the risk of nonpayment pursuant to an assignment.
[226] I expressly and firmly reject the submissions of the TTC at para 162 of its submissions quoted earlier that here the TTC had no incentive to “include a contribution from ICL’’/facilitate AB contributions to the settlement from ICL. I find it was in TTC’s interest to do so. Doing so did more for the TTC than to use the words of the TTC submission “increase TTC’s liability for costs.”
[227] I similarly reject the TTC submission in paragraph 163 that there is no principled reason that the Accident Benefit contribution should be considered in the assessment of costs in this tort litigation.
[228] Based on the informational record, it appears that at the time of the settlement the TTC must have concluded that in all the circumstances here, the overall settlement of $650,000 including a $550,000 AB component would be reasonable and in the TTC’s best interest.
[229] The TTC had a clear monetary incentive to settle when it did.
[230] From the records included in the written submissions filed with the written costs submissions, it is obvious that had the TTC let the matter proceed to trial the jury verdict on a gross basis could have ranged from an outright dismissal of the action to an order that the TTC must immediately pay several million dollars to the plaintiff. TTC’s recovery of the SABs future component of any damages awarded against the TTC would have been payable over time pursuant to an assignment under the Insurance Act and dependant on Maria’s survival for so long as the jury had assumed her survival in its calculation of the damages award.
[231] By settling before the trial, the TTC was able to avoid these uncertainties, a clear benefit to the TTC.
[232] The defendant must pay reasonable costs on the whole $650,000.
Calculation of Reasonable Costs on a $650,000 Settlement
The Scale of Costs
[233] The parties agree that Partial indemnity costs are appropriate up and until judgment.
[234] The plaintiff seeks substantial indemnity costs after April 22, 2023.
General Principles Applicable in Fixing Partial Indemnity Costs
[235] In their costs submissions the parties agreed that this Court should consider the factors in Rule 57.01(1) of the Rules of Civil Procedure and that the overriding consideration in fixing costs under both Rule 57.01 and the case law is overall fairness to both the plaintiff and the TTC. Cadieux v Cloutier supra; Clarington (Municipality) 2009 ONCA 722; CaliburToo v Ecotemp Manufacturing et al 2020 ONSC 2511
[236] In Davies v Clarington 2009 ONCA 722 52 the Court wrote: As can be seen the overriding principle is reasonableness. 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…
[237] In Bondy Raphael v Potrebic, supra, Roberts JA wrote at paragraph 53: … the overarching consideration in fixing party and party costs is to arrive at an amount that is fair and reasonable for the losing party to pay in the particular proceeding, rather than an amount fixed by the actual costs incurred by the successful litigant.
Rule 57 Factors to be Applied
[238] Rule 57.01(1) provides as follows: In exercising its discretion under s 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,
(O.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.
(O.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, (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 more than one set of costs...
(h.1) whether a party unreasonably objected to proceed by telephone conference or videoconference under Rule 1.08; and
(i) any other matter relevant to the question of costs
[239] I shall go seriatum through the Rule 57.01 factors that apply here:
(O.a) Principle of Indemnity
[240] Counsel for the TTC submitted that the principle of indemnity allows a party to receive some amount to indemnify the plaintiff for the actual cost incurred for bringing this proceeding.
[241] However, he denied that the plaintiff has put forward a valid basis for applying the indemnity principle.
[242] The TTC submitted at paragraph 143: The [plaintiff’s]dockets and… bill of costs are too flawed, overstated and are too arbitrary to form a valid basis for applying the principle of indemnity to this costs determination…
[243] Counsel for the TTC submitted at paragraph 144: If this Court should engage in such a process using the Plaintiffs Bill of Costs and dockets, there should be a deduction of 50% of hours to take into account the duplication, the over docketing and unreasonable hours, the dockets unrelated to a step in the litigation and the billing for the adjournment of the first mediation and the first trial.
[244] I have earlier referred extensively to the roughly 40 pages of dockets of the plaintiff with approximately 30 entries per page.
[245] I have been hampered in my review of reasonable fees and hours by the TTC’s failure to keep or produce any dockets of its own.
[246] That failure made it difficult for me to test the TTC’s submission that the plaintiff’s dockets are not a reliable basis for determining the appropriate quantum of fees.
Allegations of Duplication and Excessive Hours Spent
[247] Counsel for the TTC submitted that the plaintiff docketed excessively. I shall give only a couple of the TTC’s examples.
[248] The TTC submitted that the main lawyer on the file when the initial mediation was arranged was JB The initially scheduled mediation did not go ahead. JB spent 40 hours preparing for that mediation that did not proceed. Counsel for the TTC submitted that JB’s time preparing for that mediation should not be chargeable to the TTC.
[249] The date of the mediation was reset for June 23, 2023. JB spent another 40 hours preparing for it. Given the preparation for the first mediation, less preparation time should have been required for the second.
[250] For the mediation that did proceed in June of 2020, JS docketed 60 hours including 7.5 hours to attend. “Mediations do not require this level of preparation and review” [paragraph128].
[251] At paragraph 131: Following the mediation the plaintiff’s docketed time continued to be out of proportion to the steps in the litigation.
[252] When the trial that had been scheduled for June 2022 was adjourned, that led to more duplication of effort.
[253] Counsel for the TTC submitted that since JB who carried the bulk of the load early on left the plaintiff’s firm and his knowledge of the case had to be recreated, this duplication of effort ought not to be visited on the TTC.
[254] The dockets contain entries for lawyers CF, CVD, MDS, none of whom were still in the employ of the plaintiff’s law firm by the time of the settlement.
Hourly Rates
[255] Lead counsel for the plaintiff JS was called to the bar in 1979.
[256] The plaintiff’s Bill of Costs calculated the value of JS’s time throughout using a rate of $1,200 per hour.
[257] JS’ dockets on Caselines show a 2023 hourly rate of $720.
[258] Counsel for the TTC submitted that JS’s chargeable hourly rate [not his partial indemnity rate] should be between $350 and $400 per hour.
[259] Lawyer RB was called to the bar of Ontario in 2020.
[260] The Bill of Costs calculates the value of RB’s time using a 2023 hourly rate of $450 per hour.
[261] The dockets show RB’s 2023 hourly rate at $270.
[262] Lawyer JB was called to the bar in 2012.The dockets show his hourly rate at $350.
Law Clerks
[263] Like the lawyer time, law clerk time was shown on the dockets at 2023 rates throughout.
Effect of Contingency Agreement
[264] In the initial written submissions of counsel, I was not advised whether there is a contingency agreement in place between the plaintiff and her counsel. If there was, I had not been provided with a copy.
[265] In oral argument I invited counsel to make further submissions on the factors set out in Cadieux v Cloutier at paragraph 132 that might affect the assessment of costs, including any contingency agreement in this case.
[266] I received submissions on the effect of the contingency agreement in fixing costs from the plaintiff but no further submissions on the point from the TTC.
[267] I have since become aware that a similar issue arose in Bondy-Rafael v Potrebic, supra, decided by Ontario Court of Appeal after Cadieux v Cloutier .
[268] In that case, Roberts JA wrote for the Ontario Court of Appeal at paragraph 54: the amount of fees that clients pay to their solicitors, while relevant, is not determinative of the reasonableness of partial indemnity costs that a losing party is required to pay.
[269] At paragraph 55 she continued: the factors to be considered when assessing solicitor fees, including the reasonableness of contingency fees are not completely identical to those listed at rule 57.01(1) of the Rules of Civil Procedure. Most notably, while the risk assumed by the solicitor including the risk of non payment and the ability of the client to pay are relevant in assessing solicitor fees or the reasonableness of a contingency fee, these are not listed at rule 57.01.(1)...
[270] At paragraph 56: moreover ss 20 and 20.1 of the Solicitors Act S.O.1990 s15 state that a contingency fee agreement should not impact a costs award. Specifically, s 20.1 provides that a contingency fee agreement” does not affect the amount or any right or remedy for the recovery of any costs recoverable from the client by any other person. Section 20.1(1) specifies that in calculating the amount of costs for the purposes of making an award of costs, a court shall not reduce the amount of costs only because the client’s solicitor is being compensated in accordance with a contingency fee agreement.
[271] At paragraph 57: Further partial indemnity fees are not defined in terms of an exact percentage of full indemnity fees under the Rules of Civil Procedure. While representing a portion of full indemnity costs, that portion has never been defined with mathematical precision, but generally amounts to a figure in the range of more than 50% but less than 100%. This is as it should be, given the myriad factors that a court must consider in fixing costs.
[272] At paragraph 58: Here the motion judge properly took into account all of the factors under Rule 57.01(1)…
[273] I note that in fixing costs in Hemmings v Peng 2022 ONSC 6482 Dow J did not insist on seeing the contingency agreement between the plaintiff and counsel.
(O.b) The Amount the Losing Party Should Reasonably Have Expected to Pay
Reasonable Expectations
[274] Counsel for the plaintiff submitted that by refusing to enter into meaningful negotiations and forcing the case to the courtroom door, the TTC should have understood that it was driving up the costs it should reasonably expect to pay.
[275] It should have known that the plaintiff would be required to incur the very large costs here. Once the Court of Appeal had decided Cadieux v Cloutier, the TTC would have known that at a trial of this tort action, the Plaintiff would be required to prove all Maria’s costs caused by the bus accident, past and future, including all amounts covered by collateral benefits, including eligible SABs.
[276] As noted by various authors including Ross and Rodriques in the Rogers Article cited earlier, the Court’s conclusion with respect to presenting gross as opposed to net claims has created a need to account for SABs issues from the outset of commencing tort litigation all the way through to preparing and presenting evidence at trial.
[277] The silos as described by the Ontario Court of Appeal in Cadieux v Cloutier will for instance need to be reflected in the jury questions to reflect the mandated deductions from corresponding past and future damages.
Proportionality (C) The Amount Claimed and the Amount Recovered in the Proceeding
[278] I have held the amount recovered to be considered is $650,000.
[279] In Bondy Raphael and Potrebic at paragraph 60 the Court of Appeal wrote: I am of the view that the amount recovered is only one of the many factors he was required to consider and that a more nuanced approach is necessary in order to apply the principle of proportionality in the circumstances of this case to arrive at an amount that is fair and reasonable for the unsuccessful party to pay in this particular proceeding.
[280] I have considered that proportionality must not be considered in isolation because an overemphasis on proportionality may serve to undercompensate a litigant for costs legitimately incurred.
[281] At the same time, I have borne in mind that parties should be careful to work efficiently, with as little duplication as possible as the litigation proceeds.
(c) The Complexity of the Litigation
[282] I am of the view that this litigation was quite complex.
[283] The time spent and rates allowed reflected that complexity.
Application of the Applicable Principles to the Determination of Costs Here
General Approach Applying Rule 57 Factors
[284] My goal has been to find a reasonable amount that the TTC would have expected to pay at the time of the settlement.
[285] I find that the TTC must have known that by repeatedly delaying meaningful discussion of settlement it was causing the plaintiff to incur ever increasing expenses.
[286] Given, inter alia, the TTC’s denial of liability, its position on causation, the six pretrials, the plaintiff’s complete readiness for trial in June 2022 and in April 2023, the extent of the expert evidence obtained by the plaintiff, the TTC cannot be surprised that trial preparation here well exceeded the usual.
[287] The TTC could have avoided the burgeoning costs by not waiting until the last minute to settle.
[288] JS’s time alone as docketed after the trial was adjourned in 2022 to the settlement in 2023 exceeded $140,000. Other lawyer and clerk time was in addition.
[289] The TTC must have had the influence/power to encourage/induce its wholly owned subsidiary TTCICL to enter into a settlement here involving a significant AB amount because that is what TTC submitted happened on April 22, 2023.
[290] The ICL was not separately represented at the settlement meeting and Ms Qaqish did not declare a conflict.
[291] To use the words of the TTC submission at paragraph 71: [on April 22] all parties knew or ought to have known that the final settlement involved significant contribution from ICL. It had to be [emphasis added] a reasonably large amount that took into account that the plaintiff was receiving and would continue to receive $6,000 per month in attendant care alone as well as other medical benefits provided by SABs. This constituted the basis for the $550,000 settlement from ICL. Any amount less than that would have been improvident from the court’s perspective.
[292] The plaintiff makes much in its submissions of delays by the TTC.
[293] The TTC denies deliberate delay.
[294] I make no finding on whether the delay was deliberate.
[295] Regardless, it is objectively correct that if Maria had died before there had been a trial much of her claim would have died with her.
[296] There was objectively an excessive delay from the Statement of Claim in January 2016 to the filing of the Statement of Defence in April 2017.
[297] The mediation was held months after defence Catastrophic assessments had been conducted but before the plaintiff was notified that TTC AB had accepted she should be designated catastrophic.
[298] I do not accept that the plaintiff was the primary cause of the June 2022 trial adjournment.
[299] The TTC was late in seeking an opinion from Dr Yufe and played a part in delaying the June 2022 trial.
[300] The settlement was not negotiated and reached until the trial was imminent.
[301] Once the trial would start the risk analysis would change for the TTC as set out earlier in these Reasons.
[302] So long as the trial did not proceed/there was no settlement the plaintiffs costs continued to mount.
[303] As noted earlier, costs after the 2022 pretrials during late 2022 and early 2023 up to the eve of trial were significant.
[304] They were avoidable.
[305] The TTC was entitled to put the plaintiff to those costs but there was a foreseeable potential price for it to pay if the defence theory of the case was not ultimately accepted by the jury.
[306] I adopt the reasoning of D Wilson J [as she then was] in Gardner v Hann 2012 ONSC 2006 at paragraph 45: this is a case where the parties had disparate views of the nature of the injuries suffered. If the plaintiffs view prevailed, there was a risk that the assessment would exceed the policy limits…The defence was certainly entitled to maintain its view of the case and put the plaintiffs to the test of proceeding through trial, but they were aware there was a price that would be attached if ultimately the defence theory of the case was not accepted by the jury. The price is to pay the costs incurred by the plaintiff made necessary by a long trial before a jury …
[307] At paragraph 27: It was clear throughout the trial that the defence took a very different view of the nature of the injuries sustained…. Certainly they were entitled to take the approach they did and force the plaintiffs to prove all aspects of the claims…This was a case that had significant risk for the defence given the nature of the injury and age of the plaintiff. There were numerous opportunities for Hann to resolve the case …without the necessity of a long trial and Hann chose not to avail himself of those opportunities…. if the outcome is not what was hoped for or anticipated it cannot be heard to say they are not prepared to pay the consequences of refusing to settle the case.
[308] In considering and applying the principle of indemnity here, I have started with a review of the informational record, the plaintiff’s dockets, the written and oral submissions of the parties all filed on Caselines.
[309] On indemnity I have attempted to first determine an actual reasonable fee amount, then have applied a partial indemnity percentage to arrive at a partial indemnity amount.
[310] Speaking generally, the hard line taken by TTC counsel throughout the litigation and its failure to engage in meaningful settlement discussions until the second eve of the tort trial should be recognized.
[311] Because these expenses should have been avoidable, the fees should exceed the conventional fees allowed on settlement before trial - often 15% on the first $100,000 of damages and 10% on the rest.
Lawyers Rates and Hours
2023 Rates Throughout 2014-2023
[312] Throughout the period from 2014 to 2023 the dockets show hours spent at 2023 hourly rates
[313] Like the Court in Stetson Oil v Stifel 2013 ONSC 5213, 2013ONSC 5213, I am skeptical that these rates remained static over those years
Hourly Rates
Rates and Hours
[314] The 2023 rate of $1,200 per hour suggested for JS is out of line in all the circumstances here.
[315] I have instead used as a starting point the 2023 hourly rate of $720 shown on JS’s dockets.
[316] Likewise, for RB I have used $270 per hour, the 2023 rate shown on the dockets, not the rate used on the Bill of Costs.
[317] I have not allowed all docketed time at the beginning of his hire because there seems to be numerous hours of education time /duplication.
[318] I have allowed only a portion of JB’s time, much of which had to be duplicated after he left the firm.
[319] I have not allowed much of the time of CF, CVD, MDS as again it appears to be largely in the nature of education time.
[320] I have reduced the number of hours allowed and the notional actual fees charged 2014-2022.
[321] In so doing I have gone through the dockets to determine hours spent 2014 - 2023 to quantify the extent of the reduction for each.
[322] Overall, I have allowed total actual lawyer time and valued it at $400,000.
Law Clerks
[323] For the law clerks I have started with roughly docketed time for AN JD LS and SD [using 2023 rates]
[324] The 2023 rates of the law clerks shown on the dockets are on the high side, and I have reduced them somewhat.
[325] Again, I have reduced the actual rates 2014-2022 having regard to hours docketed in each year before 2023.
[326] I have valued total law clerk /paralegal time at $105,000.
Value of Partial Indemnity Fees
[327] The plaintiff seeks partial indemnity fees of 65% of the actual billed rate.
[328] Using an approximately 60 % partial indemnity rate applied to the $505000 I have arrived at $300,000 in partial indemnity fees to the date of the judgment.
[329] To the $300,000 must be added HST.
[330] In my view $300,000 plus HST is a fair and reasonable partial indemnity fee that the TTC should reasonably have expected to pay to the date of the judgment in all the circumstances here.
FEES POST SETTLEMENT
[331] The parties do not agree on costs post settlement.
[332] The plaintiff seeks costs post settlement on a substantial indemnity basis.
[333] The hours shown on the dockets end about the date when the judgment was signed.
[334] The hourly rates shown on the Bill of costs again well exceed the 2023 docketed rates.
[335] I have cut back the number of hours somewhat.
[336] I fix fees post settlement of $20,000 plus HST [inclusive of costs awarded by the Divisional Court on the leave application.]
DISBURSEMENTS
[337] Disbursements have been agreed at $125,0000 plus HST.
INTEREST
[338] Post judgment interest on costs is payable at the statutory rate.
MA Sanderson J.
Date: May 08, 2024