Court File and Parties

COURT FILE NO.: CV-21-00665635-00CL DATE: 2024-03-28 ONTARIO - SUPERIOR COURT OF JUSTICE – COMMERCIAL LIST

RE: 907037 Ontario Inc. and 2637373 Ontario Inc., Applicants AND: Plating Plus Ltd., Robin Thede and Vijai Ramkisson, Respondents

BEFORE: Peter J. Osborne J.

COUNSEL: Dalkeith Palmer, for the Applicants Hugh Scher, for the Respondent Vijai Ramkisson

HEARD: March 28, 2024

Endorsement

[1] This is the penalty or sentencing phase of a contempt hearing.

[2] For Reasons set out in my Endorsement of March 5, 2024, I found the Defendant, Vijai Ramkisson, (“Ramkisson”) to be in contempt of court.

[3] On May 26, 2023, the Plaintiffs/Moving Parties obtained default judgment against the Respondents, jointly and severally, for $319,124.82 plus interest and costs, together with costs of the motion for judgment.

[4] While the full chronology of relevant events is set out in my Endorsement of March 5, 2024, Steele J. made an order on November 22, 2023 requiring Ramkisson to attend for an examination in aid of execution, in respect of which I found him to be in contempt for his repeated refusal to do so.

[5] The parties returned to Court two days later on March 7, 2024 for advice and directions as described below. The parties returned again for the penalty phase of this contempt hearing as scheduled. I observe that Ramkisson was present, together with his counsel and counsel for the Moving Parties. A court reporter was also present.

[6] As further discussed below, Ramkisson thereafter did attend for his examination in aid of execution on March 10, 2024. In addition, he has paid to counsel for the Plaintiff, in trust, the full amount of the judgment, including all past costs awards and interest in the total amount of $441,494.40, which amount includes $72,000, in his prior cost orders. He still has not, however, moved to set aside the default judgment as he has submitted was and remains his intent.

[7] At this penalty phase hearing, the Moving Parties conceded that an incarceration order as they had originally sought on this motion would not be appropriate in the circumstances, but they submit that an appropriate penalty should include the imposition of a fine in the amount of no less than $5000, together with an order that Ramkisson pay the costs of the Moving Parties on a substantial indemnity scale. The Bill of Costs they have submitted reflects substantial indemnity costs of $34,716.87, inclusive of disbursements and HST, and partial indemnity costs of $23,991.74.

[8] Ramkisson submits that in the circumstances, an award of costs is appropriate, but that no fine should be imposed in addition thereto. In the alternative, Ramkisson submits that a fine of no more than $1500 would be appropriate. With respect to the quantum of costs, Ramkisson submits that the costs sought by the Moving Parties are excessive, and by way of illustration filed his own Bill of Costs reflecting substantial indemnity costs, inclusive of HST, of $7062.50 and partial indemnity costs, also inclusive of HST, of $4237.50.

Purpose of Civil Contempt Sanctions

[9] Rule 60.11(5) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, provides that in disposing of a motion for a contempt order, the judge may make such order as is just, and where a finding of contempt is made, the judge may order that the person in contempt,

a. be imprisoned for such period and on such terms as are just; b. be imprisoned if the person fails to comply with a term of the order; c. pay a fine; d. do or refrain from doing an act; e. pay such costs as are just; and f. comply with any other order that the judge considers necessary.

[10] The applicable principles in sentencing for civil contempt are well-established. The purposes of sentencing for civil and criminal contempt are different. The purpose of a sentence for criminal contempt is primarily about punishment. The purpose of a sentence for civil contempt is primarily about coercion and is designed to protect and enforce the rights of a private party: see Castillo v. Xela Enterprises Ltd., 2022 ONSC 5594, aff’d. 2024 ONCA 141 (“Castillo”) at para. 15 and Business Development Bank of Canada v. Cavalon Inc., 2017 ONCA 663 (“Cavalon”) at para. 77.

[11] Civil contempt orders serve a dual purpose. One purpose is practical and focused on the parties before the court: seeking to ensure that the contemnor complies with relevant court orders. The other purpose is symbolic and focused on the public at large: signaling that the court and its processes, including court orders, are to be respected.

[12] The Ontario Court of Appeal set out this purpose in Boily v. Carleton Condominium Corp. 145, 2014 ONCA 574, 121 O.R. (3d) 670 (“Boily”), at para. 79:

The purpose of a penalty for civil contempt is to enforce compliance with a court order and to ensure societal respect for the courts. The remedy for civil contempt is designed not only to enforce the rights of a private party but also to enforce the efficacy of the process of the court itself. Justice McLachlin powerfully expressed this broader purpose in United Nurses of Alberta v. Alberta (Attorney General), [1992] 1 S.C.R. 901 at 931, stating:

[t]he rule of law is directly dependent on the ability of the courts to enforce their process and maintain their dignity and respect. To maintain their process and respect, courts since the 12th century have exercised the power to punish for contempt of court.

[13] Conway J. further observed the following in Castillo:

[17] In 363523 Ontario Inc. v. Nowack, 2016 ONSC 2518, at paras. 71-72, Dunphy J. stated:

Punishment serves to denounce conduct that requires denouncing and thereby deter the contemnor specifically and others more generally who might contemplate breaches of court orders...

If a party has disagreements or issues with an order that has been made, it must nevertheless be complied with unless validly stayed or reversed on appeal in accordance with the rules. There is no self-help after an order has been issued. [Emphasis added.]

[18] While imprisonment is a common sentence for criminal contempt, it is rare for civil contempt. Ordinarily, a finding of contempt, together with a fine or some other appropriate order, is sufficient to gain compliance and restore the authority of the court. Imprisonment is a sentence of last resort: See Chiang (Re), 2009 ONCA 3, at para. 90. See also Cavalon, at paras. 82, 89.

[19] However, “[a] wilful flagrant breach of a single court order that shows a callous disregard for the court’s authority, or that causes significant prejudice to the other party may attract a jail sentence”: Cavalon, at para. 87 (emphasis added). “[S]erious violations of court orders – even if only one order or one instance – can warrant a jail sentence. In determining whether a jail sentence is needed to adequately vindicate the due administration of justice, the context in which the contempt occurs is an important consideration”: Cavalon, at para. 89 (citations omitted).

[20] Where a contemnor has purged their contempt, there usually is no longer any need or justification for imprisonment: see Andersson v. Aquino, 2019 ONSC 886, at para. 31. A contemnor bears the onus of establishing on a balance of probabilities that they purged their contempt: see Chiang (Re), at paras. 50-52.

Factors Relevant to Sentencing

[14] The following are the factors relevant to a determination of an appropriate sentence for civil contempt (Boily, paras. 90-113):

a. the proportionality of the sentence to the wrongdoing; b. the presence of mitigating factors; c. the presence of aggravating factors; d. deterrence and denunciation; e. the similarity of sentences in like circumstances; and f. the reasonableness of a fine or incarceration.

A Fit Sentence in this Case

[15] I have considered the factors above and applied them to this case.

[16] To be proportionate, the sentence must fit the wrongdoing: Boily at para. 91. A sentence for civil contempt “must be proportionate to the gravity of the offence and the degree of responsibility of the offender”: Korea Data Systems Co. v. Chiang, 2009 ONCA 3 at para. 86. The “offence” at issue in a civil contempt case is the conduct giving rise to the contempt order, not the underlying wrongdoing that brought the party before the court in the first instance.

[17] In this case, the wrongdoing was serious. Ramkisson simply but repeatedly refused to attend for an examination in aid of execution. He did so, even after I found him to be in contempt, up to and including the last appearance before me on March 7, 2024, two days after my earlier Endorsement had been released. Submissions made on his behalf on that date were still directed towards reasons why he ought not to be compelled to attend for that examination.

[18] As to mitigating factors, Ramkisson has now purged his contempt by attending for the examination, as noted above. He has also paid the full amount of the judgment into the trust account of counsel for the Plaintiff.

[19] There are also, however, aggravating factors. As observed by Conway J. in Castillo at para. 33:

It is an aggravating factor when the contemptuous conduct is “blatant, deliberate, wilful and ... unrepentant” as opposed to misguided or accidental and not intended to defy the rule of law: Chiang (Trustee of) v. Chiang (2007), 85 O.R. (3d) 425 (S.C.), at para. 38, aff’d Chiang (Re). See also Mercedes-Benz Financial (DCFS Canada Corp.) v. Kovacevic (2009), 308 D.L.R. (4th) 562 (Ont. S.C.), at para. 32.

[20] There can be no doubt here that the contemptuous conduct was blatant, deliberate and wilful. As noted above, the refusal to attend for the examination was maintained even up to the court appearance on March 7, 2024.

[21] Ramkisson continued to submit that he ought not to be compelled to attend for the examination. There are two problems with this submission. First, the issue as to whether he should be compelled to attend the examination was not before the Court and had been decided long before: that was the very subject of the order of Steele J. He had already been compelled to attend the examination. Further, he had elected to ignore the strong advice of Penny J. in his subsequent Endorsement that Ramkisson simply attend for the examination.

[22] Second, the purported basis for the argument that he ought not to be compelled to attend was premised on the further submission that he intended to move to set aside the default judgment. However, and as noted in my Endorsement of March 5, 2024 finding him in contempt, he had not done so at any time since judgment had been granted. He did not appeal the judgment, nor did he appeal the order of Steele J. As of the date of this sentencing hearing, he has still not brought that motion, a fact that is at best profoundly surprising given his stated intent.

[23] With respect to deterrence and denunciation, I again turn to the language of Conway J. in Castillo:

In Boily, at para. 105, Epstein J.A. recognized that deterrence is the most important principle in civil contempt sentencing, citing Niagara (Regional Municipality) Police Services Board v. Curran (2002), 57 O.R. (3d) 631 (S.C.), at para. 35:

The primary purpose of sentencing in contempt proceedings is deterrence: both general and specific. The punishment for contempt should serve as a disincentive to those who might be inclined to breach court orders. Our legal system is wounded when court orders are ignored. The sentence must be one that will repair the wound and denounce the conduct.

[42] In Cavalon, at para. 81, the court repeated that specific and general deterrence are the most important sentencing objectives in civil contempt cases.

[24] In my view, there is a need for denunciation and deterrence here. A contemnor cannot breach an order of this Court and unilaterally decide that he ought not to comply, based on his expressed intention, although not evidenced by action, to seek to set aside the order. That is a classic example of a “self-help remedy” which does not entitle a party to disobey a clear order of this Court.

[25] As to the similarity of other sentences for such conduct and the reasonableness of a fine or incarceration, both parties acknowledge as observed above that imprisonment is to be imposed as a sentence of last resort and is not appropriate in this case. I agree, particularly since, albeit belatedly, Ramkisson has now purged his contempt and attended for the examination.

[26] In other cases involving similar conduct, a fine has been imposed. As observed by the Court of Appeal in Boily at paras. 108 - 112:

[108] The individual appellants correctly point out in their factum that, in general, awards for civil contempt in Canada range between $1,500 and $5,000. In Chiang (Trustee of) v. Chiang (2007), [2007] O.J. No. 1409, 31 C.B.R. (5th) 19 (S.C.J.), partially rev’d on other grounds (2009), 93 O.R. (3d) 483, [2009] O.J. No. 41, 2009 ONCA 3, at para. 20, this court observed that custodial sentences are rare and that Canadian courts tend to be lenient in their contempt sentences. Even in cases where contempt has involved the loss or misuse of substantial amounts of money, the fines imposed on individuals have remained low. See, for example, Chicago Blower Corp. v. 141209 Canada Ltd.; Baxter Travenol Laboratories of Canada Ltd. v. Cutter (Canada) Ltd..

[109] The few instances in which fines have been imposed at $100,000 or higher have been against unions with large membership (see British Columbia (Health Employers Assn.) v. Facilities Subsector Bargaining Assn., [2004] B.C.J. No. 1195, 2004 BCSC 762; United Nurses of Alberta v. Alberta (Attorney General), supra) or against large corporations in egregious circumstances (Apotex Fermentation v. Novopharm). It should be noted that in Apotex, the corporate entity of Novopharm had its fine reduced to $100,000 on appeal and no individual contemnor (the officers of the corporation) was fined more than $10,000.

[110] Significant fines have been imposed only in particularly egregious cases and/or where the contemptuous conduct was motivated by personal gain (see, for example, Imax Corp. v. Trotum Systems Inc., [2013] O.J. No. 446, 2013 ONSC 743 (S.C.J.), at paras. 12-14 (fine of $50,000)).

[111] However, I also note the observation of Brown J. in Mercedes-Benz Financial v. Kovacevic, [2009] O.J. No. 888, 74 C.P.C. (6th) 326 (S.C.J.) that some recent decisions in this province have shown a willingness to impose more substantial penalties for contempt, particularly in cases in which there has been a lengthy course of disobedience and where the contemnors have not purged their contempt.

[112] In the end, the sentence imposed must be reasonable.

[27] In my view, and while incarceration is not appropriate here, the imposition of a fine is appropriate. Having considered the relevant jurisprudence and the particular facts of this case, the appropriate fine is $2500.

[28] With respect to costs, as again observed by Conway J. in Castillo:

[6] In contempt proceedings, costs are generally payable on a full or substantial indemnity basis: see Bickram v. Bickram, 2015 ONSC 705, at para. 71; The Corporation of the Township of King v. 11547372 Canada Inc. et al, 2022 ONSC 2261, at para. 27. The rationale is that the moving party should not have to bear the financial burden of the contempt: see Andersson v. Aquino, 2019 ONSC 2751, at para. 23; Astley v. Verdun, 2013 ONSC 6734 at para. 52; Royal Bank of Canada v. Yates Holdings Inc. (2007), 33 C.B.R. (5th) 268 (Ont. S.C.), aff’d, 2008 ONCA 474; Sweda Farms Ltd. et al. v. Ontario Egg Producers et al, 2012 ONSC 2240, at para. 10.

[7] Full indemnity costs have been awarded in numerous civil contempt cases: see Bickram; Township of King; Sweda Farms; Royal Bank; Sycor v. Kiaer et al, 2016 ONSC 7384; Lepp v. The Regional Municipality of York, 2021 ONSC 6695, leave to appeal ref’d, 2022 ONSC 306; College of Optometrists of Ontario v. SHS Optical Ltd.; 9646035 Canada Limited et al. v. Kristine Jill Hill et al., 2018 ONSC 5986.

[8] In determining costs on a contempt motion, the court may consider the seriousness of the conduct and its effect on the administration of justice: see Business Development Bank of Canada v. Cavalon Inc., 2017 ONCA 663, at para. 104.

[29] This Court has the jurisdiction to award costs pursuant to s. 131 of the Courts of Justice Act, taking into account the factors set out in r. 57.01(1) of the Rules of Civil Procedure.

[30] Taking into account all of those factors, and applying them to the specific circumstances of this case, I am satisfied that costs should be payable on a substantial indemnity scale. The Plaintiffs, moving parties, submitted a Bill of Costs that reflects substantial indemnity costs of $34,716.87 inclusive of disbursements and HST. As noted above, Ramkisson submits that even if costs on a substantial indemnity basis are appropriate, the quantum sought by the moving parties here is not fair and reasonable.

[31] I have reviewed the Bill of Costs. In my view, the billing rates charged are reasonable ($500 per hour for a lawyer called to the bar in 1997 and $350 per hour for a lawyer called to the bar in 2022). I observe that the hourly rate for the senior lawyer is exactly the same as that charged by Ramkisson’s own lawyer as reflected in his Bill of Costs.

[32] As to the time spent, Ramkisson’s Bill of Costs does not break down, by hour or task, the fees that he submits would be reasonable (i.e., his own fees), which are instead presented simply as a block fee. First, in contrast, the Bill of Costs submitted by the Plaintiff breaks down, item by item, how and why the time was spent, the exact number of hours applicable to each item, and the fees incurred.

[33] It is to be expected that the costs of the moving party would be significantly higher, particularly in this case where Ramkisson’s approach was simply to ignore the order of Steele J. and the repeated attempts by the Plaintiffs to compel him to attend for the examination. None of the repeated court attendances ought to have been necessary.

[34] However, in my view, some of the time spent for specific tasks is excessive. For example, the senior lawyer spent over 25 hours attending himself at CPC court to schedule the contempt motion and in reviewing draft materials prepared by his associate.

[35] Having considered the matter fully and exercising my discretion under s. 131 of the Courts of Justice Act, in my view an appropriate award of costs on a substantial indemnity scale is $27,500, inclusive of fees, disbursements and HST.

[36] Order to go to give effect to these reasons.

Osborne J.