Court File and Parties

COURT FILE NO.: CV-16-547435 DATE: 20240503 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: NORMAN WONG, Plaintiff AND: SHANE SMITH, NADINE SMITH, JOSEPH SEREDA and SEREDA & SEREDA, Defendants

BEFORE: VERMETTE J.

COUNSEL: Charles Haworth, for the Plaintiff Shawn McNamara, for the Defendants Shane Smith and Nadine Smith

HEARD: In writing

Endorsement as to Costs

[1] On January 24, 2024, I released an endorsement (2024 ONSC 534) setting aside the noting in default of the Defendants Shane Smith and Nadine Smith (together, the “Smiths”).

[2] The parties were not able to agree on costs and have delivered costs submissions.

Positions of the Parties

a. The Smiths’ position

[3] The Smiths ask for costs in the amount of $4,000.00 plus HST.

[4] The Smiths state that they have been successful and submit that they should have their costs against the Plaintiff on a substantial indemnity basis. They point out that the Plaintiff has not pursued his claim vigorously and that the motion delayed the progress of the matter by a further year. The Smiths argue that the motion has also caused them to incur further costs, without necessity.

b. The Plaintiff’s position

[5] The Plaintiff requests costs on a partial indemnity basis in the amount of $5,710.10. In the alternative, the Plaintiff’s position is that there should be no order as to costs.

[6] The Plaintiff submits that the Smiths ought not to be rewarded for their default under the Rules of Civil Procedure. The Plaintiff states that setting aside a noting in default or default judgment is an indulgence and the party granted an indulgence is not usually granted costs. The Plaintiff refers to a number of cases in support of his position. He argues that there is no reason in this case to divert from the practice of awarding costs to the plaintiff or ordering no costs when an indulgence is granted to a defendant.

[7] The Plaintiff submits that he did not act inappropriately by moving for default judgment. He states that the Smiths were in default under the Rules of Civil Procedure, ignored the Plaintiff’s request to serve and file a Statement of Defence, and served a completely deficient affidavit of documents.

Discussion

[8] There is no general rule in Ontario that a party seeking an indulgence is not entitled to costs. A blanket assertion that a party is not entitled to costs if that party seeks the court’s indulgence is not consistent with the general principles of costs. Ultimately, the issue of costs on this type of motion is an exercise of discretion. See Strathmillan Financial Limited v. Teti, 2021 ONSC 7603 at paras. 48-50 and Atlantic Construction Group Inc. v. 2567616 Ontario Inc., 2021 ONSC 4118 at para. 10.

[9] In light of the circumstances of this case, I have concluded that the most appropriate exercise of discretion is not to order costs with respect to this motion.

[10] While the Smiths were successful on the motion, the motion was made necessary because of their lack of diligence with respect to the delivery of a Statement of Defence. In addition, they failed to comply with court-ordered timetables in the past and they delivered deficient motion materials (see paragraph 29 of my endorsement dated January 24, 2024). Further, as noted in my endorsement dated November 10, 2023, there were issues with their proposed Statement of Defence and, by serving an affidavit of documents that did not list any documents in Schedule “A”, they did not comply with their obligations under the Rules of Civil Procedure with respect to documentary discovery. I find that it is not appropriate to order costs in favour of the Smiths in the circumstances of this case.

[11] I also find that it is not appropriate to order costs in favour of the Plaintiff in the circumstances of this case. The Plaintiff was unsuccessful on this motion. Further, as noted in my endorsement dated January 24, 2024, the Plaintiff noted the Smiths in default without following up on the only request for a Statement of Defence that had been made, and in circumstances where the failure to serve a Statement of Defence appeared to be the result of confusion. The Plaintiff’s decision not to agree to the setting aside of the noting in default and to pursue default judgment caused more delay in this action, which the Plaintiff has not diligently pursued.

[12] As stated in one of the cases relied upon by the Plaintiff, none of the parties emerged from this motion “covered with glory”: see Ross v. Filip, 2021 ONSC 3398 at para. 18.

Conclusion

[13] Taking the foregoing into account, as well as the factors set out in Rule 57.01(1) of the Rules of Civil Procedure, I find that it is fair and reasonable not to order costs (i.e., that the parties bear their own costs) with respect to the motion.

Vermette J. Date: May 3, 2024