Ontario Superior Court of Justice

Court File No.: CV-23-00093594-0000
Date: March 10, 2025

Parties

Between:
Construction Jadco Inc., 10701572 Canada Inc., and Desjardins Sécurité Financière Compagnie D’Assurance Vie, Plaintiffs

And:
Gamma Windows and Walls International Inc., Gamma North America, Inc., Gamma North Corporation, Gamma Installations, Inc., China State Construction Development Holdings Limited and AIG Insurance Company of Canada/La Compagnie D’Assurance AIG du Canada, Defendants

Before

R. Ryan Bell

Counsel

• Andrea Lee and Jessica Gahtan, for the Plaintiffs
• Patrick A. Thompson, for the Defendants Gamma Windows and Walls International Inc., Gamma North America, Inc., Gamma North Corporation, Gamma Installations, Inc., and China State Construction Development Holdings Limited

Heard

In writing

Costs Endorsement

[1] The plaintiffs were successful in resisting the motion of Gamma Windows and Walls International Inc., Gamma North America, Inc., Gamma North Corporation, Gamma Installations, Inc., and China State Construction Development Holdings Limited (collectively, the “Gamma defendants”) to quash the summons to witness served on Harry Wang: Construction Jadco Inc. v. Gamma Windows and Walls International Inc., 2025 ONSC 748. The plaintiffs seek their substantial indemnity costs of the motion in the amount of $43,726.88. In the alternative, the plaintiffs request partial indemnity costs in the amount of $29,264.30.

[2] The Gamma defendants argue that costs of the motion to quash the summons should only be determined at the conclusion of the underlying jurisdiction motion. In the alternative, the Gamma defendants submit that costs awarded to the plaintiffs should be between $5,000 and $8,000. The Gamma defendants’ own partial indemnity costs in respect of the motion to quash are $27,200.35.

[3] Rule 57.03(1)(a) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 provides that, unless the court is satisfied that a different order would be more just, the court shall fix the costs of the motion and order them to be paid within 30 days. The Gamma defendants say the outcome of the motion was “intricately tied” to the jurisdiction motion and costs should therefore be reserved and determined at the conclusion of the jurisdiction motion. I disagree. Where a party serves a summons to examine a witness on a pending motion, the opposing party may move to quash the summons on the ground that the evidence sought is not relevant to the motion or that the examination or the underlying proceeding would amount to an abuse of process. Relevance of a witness’ proposed evidence is a central consideration on a motion to quash a summons; that does not, however, automatically render it “more just” to reserve costs to the judge hearing the underlying motion. I am not persuaded that reserving costs would be more just in this case.

[4] The plaintiffs submit that the court should order substantial indemnity costs “to express its disapproval with the Moving Parties’ actions which have unnecessarily prolonged and complicated this dispute.” An award of costs on an elevated scale is justified only in very narrow circumstances – where an offer to settle is engaged or where the losing party has engaged in behaviour worthy of sanction: Net Connect Installation Inc. v. Mobile Zone Inc., 2017 ONCA 766, para 8, citing Davies v. Clarington (Municipality), 2009 ONCA 722, para 28. The conduct in question must be “reprehensible, scandalous or outrageous”: Young v. Young, [1993] 4 S.C.R. 3, para 250. There is nothing in the litigation conduct of the Gamma defendants that would warrant the sanction of the court through an award of substantial indemnity costs.

[5] In determining the costs of the motion, I have considered the result of the motion and the relevant factors in r. 57.01(1). The plaintiffs’ claim for damages against all defendants, including the Gamma defendants, is over $16 million. The underlying jurisdiction motion is significant in that it “has the potential to be dispositive of the action against the Gamma foreign defendants”: Construction Jadco, at para. 25. In support of their position opposing the motion to quash the summons, the plaintiffs provided evidence of Mr. Wang’s connections to the Gamma defendants. No cross-examinations were conducted.

[6] The Gamma defendants could have sought clarification regarding the scope of the proposed cross-examination of Mr. Wang. Had they done so, the motion may have proved unnecessary. That said, the motion was not complex. The hearing itself was completed in less than two hours.

[7] An award of costs should reflect more what the court views as a fair and reasonable amount that should be paid by the unsuccessful party rather than any exact measure of the actual costs incurred by the successful party: Boucher v. Public Accountants Council for the Province of Ontario, para 24. The costs must not only be reasonable as between a lawyer and their client, but the amount must also be within a range that the unsuccessful party ought reasonably to expect.

[8] In addressing the reasonable expectations of the unsuccessful parties, it is appropriate to consider the costs incurred by the unsuccessful party in addressing the same issues. In this case, the partial indemnity costs incurred by the Gamma defendants were not dissimilar to those claimed by the plaintiffs: $27,200.35 by the former as compared to $29,264.30 by the latter.

[9] The Gamma defendants’ own partial indemnity costs do not assist me here because in my view, both amounts are far in excess of what would be fair, reasonable, and proportionate for a motion of this nature. The plaintiffs’ costs outline shows the involvement of four lawyers, one legal researcher, and three law clerks. Almost 72 hours of time was incurred by the plaintiffs’ lawyers and staff in relation to the motion. There was undoubtedly duplication of effort. Simply put, too much time was expended on a relatively straightforward motion.

[10] Taking into account all the above, in my view, a fair, reasonable, and proportionate amount for the Gamma defendants to pay is $12,000, inclusive of disbursements and HST. This amount is to be paid by the Gamma defendants to the plaintiffs within 30 days.

R. Ryan Bell
Date: March 10, 2025