Endorsement on Costs

Date: 2025-05-07
Court: Superior Court of Justice – Ontario

Re: Natalie Cammalleri, Paul Cammalleri, 2196022 Ontario Inc., and Giuseppe Geraci, Moving Parties
And: Rosanna Saraceno, Respondent

Before: Parghi J.

Counsel:

• Madeleine Dusseault, for the Moving Parties 2196022 Ontario Inc. and Giuseppe Geraci
• Alexandra Heine, for the Moving Parties Natalie Cammalleri and Paul Cammalleri
• Adriana Di Biase, for the Respondent, Rosanna Saraceno

Heard: May 7, 2025 (In Writing)

Introduction

On February 25, 2025, I issued my Endorsement on the merits of the motion to strike brought under rules 21.01(1)(b) and 25.11 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. The parties were unable to agree to costs and have provided me with their respective costs submissions, which I have reviewed. This is my Endorsement on costs.

Discretion to Fix Costs

In exercising my discretion to fix costs under section 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43, I may consider the factors enumerated in Rule 57.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. Those factors include the result achieved, the amounts claimed and recovered, the complexity and importance of the issues in the proceeding, the principle of indemnity, the reasonable expectations of the unsuccessful party, and any other matter relevant to costs.

Principles from Case Law

In the recent case of Apotex Inc. v. Eli Lilly Canada Inc., 2022 ONCA 587, the Ontario Court of Appeal restated the general principles to be applied when courts exercise their discretion to award costs. The Court held that, when assessing costs, a court is to undertake a critical examination of the relevant factors, as applied to the costs claimed, and then “step back and consider the result produced and question whether, in all the circumstances, the result is fair and reasonable”. The overarching objective is to fix an amount for costs that is objectively reasonable, fair, and proportionate for the unsuccessful party to pay in the circumstances of the case, rather than to fix an amount based on the actual costs incurred by the successful litigant.

Application to This Case

Applying these considerations here, I note, first, that success on the motion was evenly divided. In the rule 21.01(1)(b) motion, I struck certain claims against the moving parties without leave to amend (negligent misrepresentation, fraudulent misrepresentation, breach of fiduciary duty, fraud, and negligence). I struck the claim against Mr. Geraci personally, with leave to amend. I did not strike the remaining claims (conspiracy, breach of contract, and unjust enrichment). I dismissed the rule 25.11 motion.

Second, I am of the view that plaintiff’s counsel generally had a rather “last minute” approach to matters pertaining to the motion. For example, before they brought this motion, the Cammalleri parties sent her demands for particulars in 2022 and 2023, to which Plaintiff’s counsel did not respond. Additionally, the moving parties’ motion materials were served in August 2023, well ahead of the scheduled motion hearing date of January 28, 2025. Yet Plaintiff’s counsel served a responding factum on the motion only on January 15, 2025, 13 days before the hearing date. She delivered an Amended Statement of Claim on January 22, 2025, six days before the hearing date. She delivered a responding motion record on January 24, 2025, an entire year after the court-imposed deadline for doing so, and four days before the hearing date.

Plaintiff’s counsel’s late-in-the day amendments to the pleading prejudiced the moving parties. By this time the Amended Statement of Claim was served, the moving parties had served their facta for the motion based on the original pleading and had prepared their oral submissions based on the original pleading. They had to rework their submissions as a consequence. They also had to undertake additional research on the leave to amend issue and prepare to address it at the hearing. As I said in my endorsement on the merits, the moving parties originally conceived of, and advanced, this motion based on the original pleading, not the amended version served on them by the Plaintiff late in the day. The Moving Defendants did, to their credit, “pivot” so that they could address the amended pleading in oral argument. Indeed, the amended version formed the focus of their submissions. Yet it is certainly unfair that they had to deal with a moving target for the purposes of this motion. In my view, this prejudice can and should be compensated by way of a costs award.

The moving parties were similarly prejudiced as a consequence of the late service of the Plaintiff’s responding motion record. It required them to rework their oral submissions to respond to the late-served motion record and to be able to argue at the hearing, which they did successfully, that the materials in the late-served motion record were improper and inadmissible.

Third, Plaintiff’s counsel delivered her Amended Statement of Claim without obtaining the moving parties’ consent or leave of the court. She was not permitted to do so. Plaintiff’s counsel delivered a motion record in respect of the motion to strike, which is not permitted under the Rules.

Fourth, while the legal issues in the motion were not in themselves particularly complex, the motion did require the moving parties to conduct research into the requirements for pleading eight distinct causes of action, and for pleading personal liability on the part of a corporate director. This would have taken time.

Costs Award

The above considerations, weighed together, warrant granting the moving parties their costs, even though success on the motion was divided. In particular, it is appropriate for the moving parties to be indemnified for the costs they had to incur to shift gears when served with late materials by the Plaintiff. It is also appropriate for the court to communicate that its processes and deadlines are to be taken seriously, and that the failure to do so may result in opposing parties incurring additional costs for which they ought to be made whole.

I grant costs on a partial indemnity scale. While aspects of Plaintiff’s counsel’s approach to the litigation did violate the requirements of the Rules and drove up the moving parties’ costs, I have addressed those concerns in my analysis above. The Plaintiff’s conduct does not warrant a substantial indemnity award.

The Cammalleri parties only provide a costs figure calculated on a substantial indemnity basis. They do not provide a partial indemnity number for their costs claim. Based on their substantial indemnity figure, I calculate their partial indemnity costs at $22,793.33, plus HST and disbursements of $496.90.

On a partial indemnity basis, the Geraci parties seek $22,009.58 in costs, plus HST and disbursements of $339.00. This is almost the same as the Cammalleri parties’ costs number.

Given the overlap in issues between the moving parties, I am not persuaded that it was necessary for each moving party to have two or three counsel on the file and to have spent as much time on some aspects of the file as they did. That said, generally work was allocated prudently among members of the counsel team having regard to their seniority, and the written materials were of assistance to me.

Factoring in the above considerations, I award the Cammalleri parties and the Geraci parties each their costs of $14,000.00, plus HST, plus their respective disbursements. In my view, this costs award reflects the principles set forth in Rule 57.01 and is fair and reasonable in all the circumstances. This amount is to be paid within 30 days.

Date: May 7, 2025
Parghi J.