SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Amanda Martin, Plaintiff
- and -
The City of Mississauga, Geoff Wright, Kimberley Leslie, and Bob Levesque, Defendants
BEFORE: MacNeil J.
COUNSEL: Amanda Martin – Self-represented Plaintiff
Thomas J. Gorsky and Ella Vitols (SAL) – for the Defendants
REASONS FOR DECISION ON COSTS
1This is my decision on costs respecting the Plaintiff’s motion made seeking various relief, including an order setting aside the parties’ signed Minutes of Settlement, dated March 14, 2024 (“the Settlement Agreement”); a declaration that the City of Mississauga (“the City”) breached the terms of the Settlement Agreement; a finding that the City made fraudulent and/or negligent misrepresentations during the negotiation and enforcement of the Settlement Agreement; a declaration that the City’s conduct constitutes bad faith and an abuse of process; and an order that the action continue as if there had been no settlement.
2The Plaintiff’s motion was dismissed as I found that a valid settlement agreement had been reached between the parties and the Plaintiff had not established any factors that would vitiate the settlement. Therefore, I concluded there was no reason to set aside the Settlement Agreement or the consent order obtained pursuant thereto. I also accepted the Defendants’ submission that the amount of time it took for the Plaintiff to bring her motion to set aside the Settlement Agreement constituted unreasonable delay and the motion should be dismissed on that basis, as well.
3The parties were unable to settle the issue of costs of the motion. They have both made written submissions setting out their positions in respect of same.
General Principles
3Section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43 provides that an award of costs is in the discretion of the court.
4Rule 57.01(3) of the Rules provides that, when the court awards costs, it shall fix them in accordance with subrule (1) and the Tariffs. Tariff A establishes the fees and disbursements that are allowable under Rules 57.01 and 58.05.
5Rule 57.01(1) sets out factors to be considered by the court in exercising its discretion to award costs, including:
the result in the proceeding;
any offer to settle or to contribute made in writing;
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;
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;
the amount claimed and the amount recovered in the proceeding;
the complexity of the proceeding;
the importance of the issues;
the conduct of any party that tended to shorten or to lengthen unnecessarily the duration of the proceeding;
whether any step in the proceeding was: (i) improper, vexatious or unnecessary, or (ii) taken through negligence, mistake or excessive caution;
a party’s denial of or refusal to admit anything that should have been admitted; and
any other matter relevant to the question of costs.
6Generally speaking, costs on a substantial indemnity basis will be awarded “where there has been reprehensible, scandalous or outrageous conduct on the part of one of the parties”. The fact that a proceeding has little merit is no basis for awarding substantial indemnity costs: Young v. Young, [1993] 4 S.C.R. 3, 1993 CarswellBC 264 (SCC), at para. 260.
7Rule 1.04(1.1) provides that, in applying the rules, the court shall make orders and give directions that are proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding.
8Modern costs rules are designed to advance five main purposes: (1) to indemnify successful litigants for the cost of litigation, although not necessarily completely; (2) to facilitate access to justice, including access for impecunious litigants; (3) to discourage frivolous claims and defences; (4) to discourage and sanction inappropriate behaviour by litigants; and (5) to encourage settlements: Fong v. Chan, 1999 CarswellOnt 3955, 128 O.A.C. 2 (Ont. C.A.), at para. 22; 394 Lakeshore Oakville Holdings Inc. v. Misek, 2010 ONSC 7238, at para. 10.
9Ultimately, in fixing costs, the primary principles remain fairness, reasonableness and proportionality.
10As stated by the Ontario Court of Appeal in Boucher v. Public Accountants Council (Ontario) (2004), 71 O.R. (3d) 291 (Ont. C.A.), at para. 26, when fixing costs, the calculation of hours and time rates is only one factor to be taken into account. The overall objective is “to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding, rather than an amount fixed by the actual costs incurred by the successful litigant.” (See also Zesta Engineering Ltd. v. Cloutier, 2002 CarswellOnt 4020, [2002] O.J. No. 4495 (Ont. C.A.), at para. 4.)
Position of the Defendants
11The Defendants seek their costs on a substantial indemnity basis in the amount of $49,146.53, inclusive of HST. This amount also includes their disbursements in the amount of $283.80.
12The Defendants submit that the Plaintiff raised nearly every available ground in her effort to set aside the settlement, including fraud, misrepresentation and duress, and matters were further complicated by the fact that the action had been dismissed. The motion was of medium complexity. It was very time consuming to review and respond to the Plaintiff’s allegations in her motion materials.
13It is contended by the Defendants that the Plaintiff’s email, dated October 3, 2024, threatened to report the personal defendants to their professional regulators unless the Defendants offered to renegotiate the settlement. Her conduct in this regard was “egregious and grossly improper” and amounts to “extortion”.
14The Plaintiff waited until after she had cashed the settlement funds cheque before disputing the validity of the settlement. She unilaterally served notices of motion on five occasions. She refused to collaborate with counsel for the Defendants on agreeing to a return date. She also refused to consent to an adjournment of one of the motions she made even though the Defendants’ counsel was in court that day dealing with another matter. As a result, a contested adjournment had to be argued.
15The Plaintiff alleged fraud but failed to prove it. She failed to put forward any evidence even capable of constituting fraud. In alleging fraud and misconduct, the Plaintiff impugned the integrity of individuals and was unconcerned about the potential harm to the personal defendants’ reputation. It is a longstanding legal principle that substantial indemnity costs are presumptively warranted when a party makes unproven allegations of fraud or deliberate misconduct: CIBC Mortgages Inc. v. Vieira et al., 2014 ONSC 56, at paras. 5-6; Ascent Incorporated v. Fox 40 International Inc., 2009 45322 (ON SC), at paras. 3-5.
16This matter involved “7 years of protracted litigation” before the Defendants entered into the settlement in order to bring “peace of mind and certainty” to a disruptive situation. The Plaintiff’s attempts to set aside the settlement “robbed” the Defendants of the peace of mind they bargained for: Sinclair-Cockburn Insurance Brokers Ltd. v. Richards (2002), 61 O.R. (3d) 105, at para. 14.
17When circumstances warrant, a costs award should operate as a deterrent against bringing meritless legal proceedings.
Position of the Plaintiff
18The Plaintiff submits that the amount of costs being claimed by the Defendants is excessive, disproportionate and punitive for a single-day motion. She asserts that a substantial portion of the length and complexity of the motion was caused by the Defendants’ own conduct. For instance, during cross-examination of one of the Defendants’ affiants, 147 questions were refused which “created major evidentiary gaps” and “forced additional submissions”. The Defendants’ timelines were contradicted by documents that were obtained through FOI. Further, the Defendants relied on documents that were never produced to the Plaintiff and this “lack of disclosure directly contributed to the need for the motion”.
19The Plaintiff relies on the decision in Pintea v. Johns, 2017 SCC 23, as support for her argument that “courts must avoid procedural unfairness toward SRLs and must not use costs to punish good-faith efforts to seek clarity or fairness”. (It is noted, however, that the Supreme Court of Canada’s decision in Pintea was a brief oral judgment that allowed an appeal of a decision of a case management judge to strike the plaintiff’s claim, find the plaintiff in contempt of court, and award costs to the defendants. There is no pronouncement in the decision on the use of costs, as asserted by the Plaintiff.)
20The Plaintiff contends that she raised issues of genuine public interest and importance, and this should weigh against a costs award. She submits that, after the motion, “multiple regulatory and oversight bodies independently validated the legitimacy of the issues raised by” her. As a result, it would be “unjust and contrary to Rule 57 to penalize a self-represented litigant whose concerns have been validated by three independent oversight bodies”.
21The Plaintiff submits that she acted reasonably, responsibly and in good faith throughout. (While she also submits that the court “expressly found” that she “acted in good faith and brought the motion in the public interest”, I did not make such a finding.)
22The Plaintiff requests that no costs be awarded against her and submits that it would be appropriate for each party to bear their own costs. Alternatively, any costs awarded should be nominal and strictly proportionate.
Analysis
23Given that the Plaintiff’s motion was wholly unsuccessful, the Defendants are entitled to costs. A determination must be made as to what a fair, reasonable and proportionate quantum of costs is in these particular circumstances.
24The Defendants seek their costs on a substantial indemnity basis in light of the unsubstantiated allegations of fraud, misrepresentation, and misconduct made against them by the Plaintiff. The issue of awarding of costs in cases where allegations of fraud or misconduct are made and not ultimately proven was discussed by the Supreme Court of Canada in Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, at para. 26, as follows:
26 In Young v. Young, [1993] 4 S.C.R. 3 (S.C.C.), at p. 134, McLachlin J. (as she then was) for a majority of this Court held that solicitor-and-client costs “are generally awarded only where there has been reprehensible, scandalous or outrageous conduct on the part of one of the parties”. An unsuccessful attempt to prove fraud or dishonesty on a balance of probabilities does not lead inexorably to the conclusion that the unsuccessful party should be held liable for solicitor-and-client costs, since not all such attempts will be correctly considered to amount to “reprehensible, scandalous or outrageous conduct”. However, allegations of fraud and dishonesty are serious and potentially very damaging to those accused of deception. When, as here, a party makes such allegations unsuccessfully at trial and with access to information sufficient to conclude that the other party was merely negligent and neither dishonest nor fraudulent (as Wilkins J. found), costs on a solicitor-and-client scale are appropriate: see, generally, M.M. Orkin, The Law of Costs, (2nd ed. (loose-leaf)), at para. 219.
25I agree with the Defendants’ submission that, in her motion material and at the hearing itself, the Plaintiff continued to cast aspersions on the Defendants. However, in my view, it is difficult to ascertain whether the Plaintiff is capable of changing her thinking towards the Defendants in this regard or if there is something else impacting on her conduct. I am uncertain if she is proceeding with actual malicious intent. As a result, I hesitate to find that her conduct is at the level of reprehensibility that warrants costs on an elevated level. I am also cognizant that the Plaintiff, as a self-represented litigant, is not legally trained and, perhaps, does not fully understand the legal implications and ramifications of her various allegations. Having said that, the Plaintiff did seek to set aside a valid settlement agreement (and consent order) based on allegations of fraud, misrepresentation, and dishonesty which were not proven. Litigants should be discouraged from re-litigating settlements without good reason.
26Since I am not persuaded that the Plaintiff’s conduct has been “reprehensible, scandalous or outrageous” warranting an award of costs on a substantial indemnity basis, as requested by the Defendants, I will determine costs on a partial indemnity basis.
Fair and reasonable costs
27I am satisfied that the hourly rates claimed by the Defendants’ counsel can be considered to be fair and reasonable. However, I agree with the Plaintiff’s submission that the hours claimed are excessive for a motion of this nature. As well, it appears to me that the claim for senior counsel’s “communications with plaintiff, client and court” at 35 hours (out of a total of 82.2 hours) is high. There were no detailed dockets submitted by the Defendants for the court to review, only a summary of the work done set out in a chart, so I am unable to say if all of the time claimed in this regard was necessary for responding to this motion.
28I have also considered the following:
(a) It was not reasonable for the Plaintiff to have brought the motion.
(b) The motion was of great importance to the Defendants, and it had to respond accordingly since, if the settlement had been set aside, the litigation would have resumed.
(c) The motion materials were voluminous.
(d) The motion was complicated by the number and nature of the allegations made by the Plaintiff.
(e) The Plaintiff could reasonably have expected to pay costs in the event of lack of success on the motion.
29I accept the disbursements claimed by the Defendants in the amount of $283.80 for printing/photocopies to be reasonable and necessarily incurred.
30Having regard to all of these factors and considering the balancing exercise required under Rule 57.01 and the guidance provided by the Boucher decision of the Ontario Court of Appeal, I am satisfied that awarding costs to the Defendants in the amount of $24,000.00, inclusive of HST and disbursements, is fair, reasonable and proportionate in the circumstances.
Disposition
26For the foregoing reasons, this court orders that the Plaintiff pay costs to the Defendants fixed in the amount of $24,000.00, payable within 45 days of the release of these reasons.
_______________________
MacNEIL J.
Released: March 6, 2026