Court File and Parties

Court File No.: CV-17-00003274-0000 Date: 2026-03-25 Ontario Superior Court of Justice

Between:

ANDREW SANAYHIE Plaintiff

– and –

DURHAM REGIONAL POLICE SERVICES BOARD, JONATHAN HOOD and KASHIF POLANI Defendants

Counsel: Barry Evans and Kevin Mitchell-Gill, for the Plaintiff Shannon M. Gaudet, for the Defendants

Heard: January 21, 2026

Ruling Re: Costs

MCKELVEY J.:

Introduction

[1] This action was commenced by the Plaintiff, Andrew Sanayhie, against the Durham Regional Police Services Board and Constables Jonathan Hood and Kashif Polani. The Plaintiff alleged that he was wrongfully arrested after he failed to leave the Tim Hortons restaurant in the early morning hours of December 22, 2015. The plaintiff also alleged that the officers used excessive force in removing him from the store and that he was subsequently maliciously prosecuted by Constable Hood when he was criminally charged with assault with intent to resist arrest and assault causing bodily harm following the incident.

[2] The action was tried by a jury in January, 2025.

[3] The jury dismissed the Plaintiff's claims that he was wrongfully arrested and that the officers used excessive force in removing him from the store. However, the jury found in favour of the Plaintiff on the malicious prosecution allegation. They awarded damages of $55,000 for malicious prosecution, $3,390 for actual legal expenses incurred by the Plaintiff in defending the criminal charges and an award of punitive damages of $5,000

[4] There was an issue following the jury's verdict as to whether the jury's verdict on the malicious prosecution allegation should be upheld. I found in favour of the Plaintiff on this issue.

[5] The parties have now come before me to deal with the issue of costs in the action

Parties' Positions with Respect to Costs

[6] The Plaintiff seeks costs of $294,000 which includes disbursements of $26,117.40. The defence argues that the Plaintiff should only be entitled to a claim for $75,332.66 for costs which includes disbursements of $3,856.40.

[7] During the course of argument there was agreement by counsel that the Plaintiff's demand for costs should be reduced by $20,000 to reflect the fact that included in the Plaintiff's bill of costs are claims for trial time where Plaintiff's counsel was not required to attend. Thus, it was agreed that the Plaintiff's demand for costs should correspondingly be reduced to $274,000, inclusive of fees and disbursements.

Factors Relating to Costs

[8] Rule 57.01 sets out the criteria which a court should consider in awarding costs. The particular factors which appear to be the most relevant in this case are as follows:

1. the results of the proceeding
2. any offer to settle made in the action
3. 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 the lawyer
4. the amount of costs that an unsuccessful party could reasonably be expected to pay
5. the amount claimed and the amount recovered in the preceding
6. the apportionment of liability
7. the complexity of the proceeding
8. the conduct of any party that tended to shorten or to lengthen unnecessarily the duration of the proceeding

Who was the successful party at trial?

[9] The Plaintiff asserts that he was the successful party at trial. He received an award of $63,900 together with interest.

[10] The Defendants acknowledge that the Plaintiff was partially successful at trial and is therefore entitled to some level of costs. It asserts that the Plaintiff's demand is not reasonable in the circumstances of this litigation. The Defendants assert that success was divided at trial and that the defence was successful in defeating two of the three causes of action, namely the allegation of unlawful arrest and excessive force being used at the time of the arrest. The Defendants therefore assert that the Plaintiff's costs should be reduced by two thirds to represent the Defendants' success on two of the three claims advanced, as well as some of the claims that were abandoned during the course of trial.

[11] This raises the issue of whether there should be a reduction in respect of issues on which the Plaintiff was not successful. In Oakville Storage & Forwarders Ltd. v. Canadian National Railway (1991), 1991 CanLII 7060 (ON CA), 5 O.R. (3d) 1 (C.A.), the Court of Appeal heard an appeal from a judgment following a long and complex trial, which had imposed a distributive costs order, which is an order under which the major issues at trial are identified and the party who is successful on each issue is awarded costs for the time and expense attributable to that issue. In that case five issues had been identified. The Court of Appeal pointed out the "dubious virtue" of a distributive order for costs. It noted that offer to settle rules are "result" oriented, not "issue" oriented and a distributive approach would work at cross purposes with the intended result of those rules. This is particularly significant in a case like the present one where an offer to settle was served by the Plaintiff which was less than the result of trial. As noted by Justice Penny in his decision in Murray v. Pier 21 Asset Management Inc., 2020 ONSC 5606, at para. 26, the Court in Oakville Storage,

did not decide whether a distributive costs order was ever appropriate (although it found it "difficult to imagine" that it could be) but clearly held that this was not the proper case for any such order. Importantly, the Court found that "individual issues can be dealt with more appropriately under the general discretion and explicit guidance set forth in" Rule 57: Oakville Storage, at p. 333.

[12] Justice Penny makes reference to another Court of Appeal decision on costs, Eastern Power Limited v. Ontario Electricity Financial Corporation, 2012 ONCA 366. In that case, the Court of Appeal allowed the appeal of Eastern Power (the plaintiff) on one of six claims that were dismissed at trial. The six claims involved a total of $121,000,000. The one claim on which Eastern Power prevailed on was worth about 8.5 million dollars. The Court of Appeal held that notwithstanding Eastern Power's success on appeal on one issue, Ontario Electricity Financial Corporation remained overwhelmingly the successful party at trial. Eastern Power's success on the one narrow issue did not disentitle it from an award of trial costs or entitle Eastern Power to an award of trial costs. Nevertheless Eastern Power's success on the one issue on appeal merited some consideration and so the Court of Appeal went on to hold that Eastern Power's limited success should be reflected in the quantum of the award.

[13] Justice Penny notes that this did not mean, however, that the court was making a distributive costs award. He states,

This did not mean, however, that the Court was making a distributive costs award. The Court held at para. 19 that:

Thus, the unavailability of a distributive costs award does not preclude the court from considering Eastern Power's limited success. Indeed, the general principles that govern costs decisions [under Rule 57] require us to consider the peculiar features of a given case. Therefore, although we would award trial costs to OEFC and decline to award costs to Eastern Power, in doing so, and in arriving at our ultimate order, we have considered Eastern Power's success on the narrow inter-area transmission credit issue.

[14] Justice Penny notes that the Court of Appeal in the Eastern Power case went on to reduce the costs award to OEFC made at trial by 15% to reflect a number of factors under Rule 57, including Eastern Power's success on the single issue argued on appeal.

[15] Justice Penny goes on to summarize the principles that can be taken from the case law as follows:

What I take from these cases, in the present context, is that the court should not generally analyze each issue in a trial and award costs to various parties depending on their success on that issue. Rather, the court must make an overall assessment of success and make a determination on prima facie entitlement to costs on that basis. Some analysis of relative success may be appropriate, however, in determining the quantum of that entitlement. For example, it may be appropriate to deny recovery for costs associated with an issue on which the overall successful party did not prevail. This is not necessarily the case of course. It is a question of applying all relevant factors under Rule 57 and, in the careful exercise of the Court's discretion, arriving at a costs award that is fair and reasonable in all of the circumstances. [Emphasis added.]

[16] In the Murray decision, Justice Penny ultimately ruled that there should be a reduction of 20% of the plaintiff's claimed partial indemnity costs. This reduction reflected the fact that the plaintiff was not successful on four headings of damages.

[17] In the present case, the Defence argues that the Plaintiff's claim for costs should be reduced by two thirds given that the Plaintiff was unsuccessful on two of the claims. I do not view this as being a reasonable outcome. As I will note later in these Reasons, the Plaintiff made a Rule 49 Offer to Settle for $60,000 inclusive of general and special damages, together with costs to be assessed or agreed upon. It is apparent that the result in this case was more than the Rule 49 Offer. On the other hand, the Defendants made a series of offers. Two of those offers agreed to have the action dismissed without costs if the offer was accepted within a very short time frame. A third offer was made for $15,000 plus the sum of $9,393.40 for disbursements, but was only open for acceptance within five days.

[18] In the overall context of this case, therefore, I have concluded that the Plaintiff was successful. As noted in the Court of Appeal decision in Barry v. Anantharajah, 2025 ONCA 603, Justice Pepall comments as follows:

She (the trial judge) then turned to the impugned statement that success is determined relative to the parties' positions at trial, closing her commentary by stating: "Having set a line in the sand, the Defendant must accept that she lost on her own measure." The appellant asserts that the trial judge thereby assessed success by looking at whether the judgment exceeded the defendant's offer. I do not read her reasoning in that way. She concluded on the information available to the appellant that the respondent was going to be entitled to some damages and therefore the refusal to make an offer was not reasonable. Her decision is therefore not contrary to the principle identified in Bell Canada and Przyk, that if a party opts for a "hardball" approach to settlement, that party takes the risks associated with such a posture. Put differently, a defendant is not required to make any settlement offers, but if that is the posture adopted, it must live with the consequences of that posture if its decision does not prove to have been a reasonable one. I see no error in principle in that regard. As Tulloch J. (as he then was) stated in Lenet (Total Business Solutions) v. Dorfin Distribution Inc., 2008 CanLII 6423 (Ont. S.C.), at para. 21: "Inherent in every lawsuit is the risk that, if the plaintiff succeeds in recovering even a nominal amount, a defendant may be liable to pay costs to the plaintiff."

[19] In the present case, I have concluded that the Defendants' decision not to make a meaningful offer of settlement was not a reasonable approach by the defence. In reviewing the video of the altercation at the Tim Hortons it is apparent that the police quickly gained the upper hand in the altercation and used a good deal of force in subduing the Plaintiff. The decision to lay charges against the Plaintiff for assault with intent to resist arrest and assault causing bodily harm certainly suggests that the defence faced a serious risk that the jury would make a finding of liability on this cause of action.

[20] The failure of the defence to make a reasonable offer to settle prior to trial leads to my conclusion that the Plaintiff was the successful party in the action and that the reduction in costs sought by the defence on the basis of divided success should be modest.

[21] I do accept, however, that some reduction in the Plaintiff's costs should reflect the divided success and is warranted in this case. The Plaintiff lost on two of the three causes of action advanced at trial. In addition, as noted by the defence, the action failed entirely against one of the Defendants, Kashif Polani. As noted by the Defence in their submissions, there is at least an argument that the Defendant Polani had the right to claim costs against the Plaintiff on behalf of Mr. Polani given that the action was dismissed against him entirely. In their submissions, however, the Defendants did not advance a claim for costs on behalf of Officer Polani. Nevertheless, I agree that this is a factor to be taken into account in assessing the Plaintiff's costs.

[22] In the Murray decision, Justice Penny ultimately ruled that there should be a reduction of 20% of the plaintiff's claim for partial indemnity costs. This reduction reflected the fact that the plaintiff was not successful on four headings of damages.

[23] I have concluded that in this case, based on the divided success, there should be a deduction of 20% for the claim for legal fees sought by the Plaintiff.

The Amount Claimed and Recovered in this Case

[24] The Defendants point to the fact that the Plaintiff claimed $2,500,000 for general, special and punitive or aggravated damages. The Defendants assert that, "following the trial, the jury awarded just $63,900 – less than 3% of the amount claimed. Accordingly, this should be reflected in the costs award". The Defence also argues that any costs should reflect the modest amount of the jury's award.

[25] While the amount claimed in the statement of claim was quite large, it is apparent that the amount truly in dispute was much less. In his submissions to the jury the Plaintiff sought $100,000 to $150,000 for all headings of damages. The Defendants went to the jury and submitted that the damage assessment should be less than $20,000. Both parties clearly understood that the potential for damages was much less then was reflected in the statement of claim. Plaintiff's counsel suggested that these estimates came at the end of trial. However, prior to trial the Plaintiff delivered an offer to settle for $60,000 which clearly reflected their view of the potential damages in this case. My conclusion is that both Plaintiff and defence counsel clearly understood that the potential for damages in a case like this was modest despite what was claimed in the statement of claim.

[26] In the Barry v. Anantharajah case, Justice Pepall considered the issue of proportionality of the claim for costs. The position of the appellant in that case was that the costs award was wholly disproportionate to the judgment. She noted in that case that there was some recovery by the plaintiff and the trial judge found that the respondent's unreasonable refusal to make a monetary offer required that the matter go to trial. Although the costs ordered exceeded the recovery, the costs order was proportionate to the importance and complexities of the issues and to the amount involved in the litigation. In that case the trial judge reduced the plaintiff's costs award by $100,000 on the basis of proportionality. This decision was upheld on appeal.

[27] In her Reasons, Justice Pepall comments as follows at paras. 47 and 48:

I would also add that proportionality should be considered but it should not necessarily trump all other considerations in a costs assessment. This court has recognized that "an overemphasis on proportionality to the detriment of the other equally relevant factors 'ignores the principles of indemnity and access to justice', especially in proceedings where legitimate claims of clearly wronged plaintiffs are being pursued". [Authorities omitted.]

This observation is also reflected in much of the commentary on costs made by many experienced trial judges who of course have a heavy diet of costs decisions with which to grapple. In Aacurate v. Tarasco, 2015 ONSC 5980, 51 C.L.R. (4th) 314, at paras. 15-16, McCarthy J. observed that proportionality should not be invoked to undercompensate a plaintiff for costs legitimately incurred. A pattern of such outcomes would result in a denial of access to justice and it would tend to "encourage those resisting legitimate but modest claims to take unreasonable positions, the logic being that any exposure to costs will be limited because of the size of the claim regardless of the time and expense necessary to extract a judgment": Aacurate, at para. 16.

[28] In her decision, Justice Pepall notes that the case under appeal before her was not one where the respondent's action was dismissed and the appellant's offers to settle were vindicated. She states, at para. 53:

Here, no offer within r. 49 of the Rules of Civil Procedure was ever made by the appellant and the appellant asked the jury to award the respondent nothing. Instead, the appellant was found liable to the extent of 85% and the jury did award damages, all be they (were) for much less than the respondent had claimed or hoped. But nonetheless, it was open to the trial judge to determine that the respondent was successful at trial. The appellant must be prepared to accept the risk that the principle of proportionality will not invariably serve to reduce a discretionary costs award. Furthermore, as Zarnett J.A. pointed out in Przyk, at para. 12, the result is not the exclusive consideration.

In the present case, I have concluded that both Plaintiff and Defence counsel clearly understood that the potential for damages in this case was modest, despite what was claimed in the statement of claim. I have also concluded that the modest recovery by the Plaintiff does not justify a reduction in the Plaintiff's costs as to do so would result in a denial of access to justice.

Rule 49 Offers

[29] On April 12, 2022, the Defendants served a Rule 49 offer to have the action dismissed without costs if the offer was accepted within 30 days. After 30 days the Plaintiff was to pay the Defendants' partial indemnity costs.

[30] On May 27, 2024, the Defendants served a Rule 49 offer to have the action dismissed without costs if the offer was accepted within 10 days. After 10 days the Plaintiff was to pay the Defendants' partial indemnity costs.

[31] On October 21, 2024, the Plaintiff served a Rule 49 offer to settle for $60,000 inclusive of general and special damages, together with costs to be assessed or agreed upon. The offer was global in nature and was not apportioned among individual causes of action.

[32] On November 29, 2024 the Defendants served a Rule 49 offer for $15,000 inclusive of all damages and interest plus the sum of $9,393.40 for disbursements, together with costs of the Plaintiff on a partial indemnity basis to the first day after the offer was served. If this offer was not accepted within five days, the Plaintiff was to consent to a dismissal, with partial indemnity costs payable to the Defendants.

[33] As noted previously, the jury ultimately awarded $63,900, which exceeded the Plaintiff's Rule 49 offer.

[34] Under Rule 49.10 the cost consequences of an offer to settle by the Plaintiff are as follows:

49.10 (1) Where an offer to settle,

(a) is made by a plaintiff at least seven days before the commencement of the hearing of the proceeding;

(b) is not withdrawn and does not expire before the commencement of the hearing of the proceeding; and

(c) is not accepted by the defendant,

and the plaintiff obtains a judgment as favourable as or more favourable than the terms of the offer to settle, the plaintiff is entitled to partial indemnity costs to the date the offer to settle was served and substantial indemnity costs from that date, unless the court orders otherwise.

[35] The Plaintiff obtained a judgment which was more favourable than their offer to settle. As a result the Plaintiff is prima facie entitled to partial indemnity costs up to the date of the offer to settle and substantial indemnity costs from that date forward. The Defence offers, of course, do not have any bearing on the scale of costs owed to the Plaintiff. They do suggest, however that the Defendants were drawing a "line in the sand" and were denying any liability in this action, leaving the Plaintiff with no option except to take this case to trial.

[36] There is no basis in my view to deny the Plaintiff costs on a substantial indemnity basis from the date the offer to settle was served. However, in my view this should not mean that the other factors referred to in Rule 57.1 are not applicable. So, for example the reduction of 20% to account for the Plaintiff's failure to establish that the arrest was unlawful or that excessive force was used should still apply. As noted in Rule 57.1, offers to settle are listed as a factor to consider, among others. These other factors must still be taken into consideration. Otherwise the purpose of the rules relating to costs would be frustrated. However, any deductions from a plaintiff's claim for costs should be taken from an enhanced level of costs if under Rule 49 a court concludes that substantial indemnity costs are warranted. If the result were to be otherwise, I have concluded that this would be unfair to the party who is seeking payment for their costs.

Conduct of any Party that Tended to Lengthen the Proceeding and the Use of Senior Counsel

[37] In the present case the Defendants point to actions taken by the Plaintiff which tended to lengthen the trial. This included motions brought by the Plaintiff to require one of the defence witnesses to testify in person as opposed to by video, as well as a motion brought by the Plaintiff objecting to certain testimony by an expert witness. In my view no deduction should be made under this heading. This trial proceeded in a relatively orderly way and was completed within the expected timeline assigned to it. To rely on particular parts of the trial which might have shortened it comes close to entering into a distributive approach on costs. The motions brought by the Plaintiffs were not totally without merit and do not in my view justify a reduction of costs.

[38] The Defendants also assert that this was a relatively uncomplicated case which did not justify the use of two senior counsel.

[39] The trial in this action involved evidence being given by experts by both the Plaintiff and defence. There was video evidence of the incident at the Tim Hortons which required extensive review by the witnesses who were called trial. The issues ranged from unlawful arrest, to excessive use of force to malicious prosecution. The reputations of the Police Officers and the Police Board were clearly in issue and merited the employment of senior counsel on both sides.

[40] It is interesting to note that from the defence side, the case involved a lawyer with 41 years experience who was not the lawyer who handled the trial. However, the defence lawyers who did handle the trial had 13 years and four years experience at the time of trial. I consider a lawyer with 13 years experience at a major law firm to be senior counsel. I note as well that the bill of costs by the defence in this case exceeded the amounts claimed by the Plaintiff for their costs.

[41] In the Barry case, Justice Pepall notes that the trial judge reduced the quantum of costs by $100,000 on the basis of proportionality and that higher legal fees were caused by the respondent's decision to retain two senior lawyers. The latter accounted for a $40,000 reduction. Justice Pepall concluded that she was not persuaded that the trial judge's discretionary award should be replaced by the Court of Appeal. While the Plaintiff's costs taken globally were reasonable, I accept the Defence position that having two senior counsel may have resulted in a claim for costs which should not be borne by the Defendants. It must be kept in mind, however, that having a second senior counsel on the case likely reduced the hours charged over having a more junior lawyer assist with the case. I have concluded that it would be reasonable to discount the Plaintiff's claim for costs by $20,000 in order to reflect that the Plaintiff was represented by two senior counsel.

Deduction for the Cost of the Expert Evidence

[42] As part of their disbursements the Plaintiff is claiming $4,900 for the expert report used at trial as well as $14,800 for the attendance of the expert to give evidence. The Defendants deny that they should be responsible for payment of the expert's account given that the expert only gave evidence on the two issues which the Plaintiff was not successful on at trial.

[43] The Defendants rely on a decision by Justice McCarthy in Oskar v. Chee, 2012 ONSC 2939. In that decision Justice McCarthy dealt with a claim by the plaintiffs for a disbursement for an expert called on damages by the plaintiffs. The cost of this disbursement was $30,587.39. In his decision Justice McCarthy commented as follows:

The Lehman report was put before the court for no real purpose. Presumably, it served to satisfy the Plaintiffs that the opinion obtained by the Defendants would prevail on the issue of pecuniary damages. The report was of no utility to the court in determining the issues before it. The Plaintiffs did not pursue the issue which it was designed to address, nor could the report be said to have advanced the Plaintiffs' position in any way.

[44] In the Murray decision, Justice Penny dealt with a similar issue. The defendants in that case objected to indemnifying the plaintiff for bills she received from tax experts in the sum of $74,607.25. They did so on the basis that the tax experts were retained in connection with the transaction structure which was a discrete issue on which the plaintiff was wholly unsuccessful. In concluding that the costs of the tax experts should be disallowed, Justice Penny comments at para. 68,

I agree with the defendants that it is unreasonable to expect the defendants to pay for expert tax services retained to advance a discrete argument on which the plaintiff was wholly unsuccessful at trial. The fees for tax experts, in the amount of $74,607.25, is disallowed.

[45] Similarly, in this case, the evidence given by the Plaintiff's expert was clearly not accepted by the jury as the two issues on which the expert opined were dismissed by the jury in their decision.

[46] I have therefore concluded that the claim for the Plaintiff's expert which totaled $19,700 should be dismissed.

The Amount of Costs that an Unsuccessful Party Could Reasonably be Expected to Pay

[47] While the claim in this case was a relatively modest one, there were serious issues to be tried. I have concluded that it would be unjust to undercompensate a Plaintiff for costs legitimately incurred. A pattern of such outcomes would result in a denial of justice and it would tend to encourage those resisting legitimate but modest claims to take unreasonable positions, the logic being that any exposure to costs would be limited because of the size of the claim regardless of the time and expense necessary to extract a judgment. I have concluded that the Plaintiff should not be undercompensated in the face of having submitted a reasonable offer to settle prior to trial and a meritorious claim for malicious prosecution.

Order

[48] I therefore order the Defendants Jonathan Hood and Durham Regional Police Services Board to pay the following costs to the Plaintiff as follows:

Counsel Fee: $237,260 minus $20,000 (as agreed by the parties)

Subtotal: $217,260

Less 20% of counsel fee to reflect the divided success in the action: $43,452

Net amount owing: $173,808

Less $20,000 on account of two senior counsel: $153,808

Net amount owing on counsel fee: $153,808

HST on counsel fee: $19,995

Disbursements: (reduced by the cost of the Plaintiff's expert) - $6,417.70

Total: $180,220.70

[49] The amount of $180,220.70 is therefore ordered to be paid by the Defendants Durham Regional Police Services Board and Jonathan Hood to the Plaintiff.

Justice M. McKelvey

Released: March 25, 2026