Court File and Parties
CITATION: Fourth Amen Holdings Inc. et al. v. Environmental 360 Solutions (Ontario) Ltd. et al., 2026 ONSC 2820
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: FOURTH AMEN HOLDINGS INC. O/A MANSOUR GROUP and 1916561 ONTARIO LIMITED, Applicants
AND:
ENVIRONMENTAL 360 SOLUTIONS (ONTARIO) LTD. and ENVIRONMENTAL 360 SOLUTIONS (ONTARIO) INC., Respondents
BEFORE: Schabas J.
COUNSEL: Reuben Rothstein and Sezen Izer, for the Applicants
Jeremy Sacks, for the Respondents
HEARD: In writing
COSTS ENDORSEMENT
1On March 13, 2026, I granted judgment for the Applicants, awarding them damages totalling $1,628,666.66, not including interest. The parties have been unable to resolve the issue of costs. I have now received submissions on costs and considered them.
2The Applicants seek costs on a substantial indemnity scale, relying on their offer to settle and the Respondents’ conduct in the litigation which the Applicants submit was unreasonable. The Respondents submit that costs should be on a partial indemnity scale and take issue with the amounts claimed by the Applicants, which the Respondents argue are “grossly disproportionate to the nature, scope and complexity of the case.”
3On November 3, 2025, the Applicants served a Rule 49 Offer to Settle. That Offer provided that the Respondents would pay $1,081,000 in damages, and $250,000 in legal fees, in exchange for a mutual full and final release. The judgment exceeded the total amount of the Offer, awarding damages of $1,628,666.66 (not including interest or costs). Accordingly, in accordance with Rule 49, the Applicants are presumptively entitled to at least partial indemnity costs up to the date of the offer, and substantial indemnity costs thereafter.
4However, I do not agree that the Applicants are entitled to substantial indemnity costs throughout. Absent the effect of Rule 49, an award of substantial indemnity costs arises only when the unsuccessful party’s conduct is reprehensible and requires sanction by the Court Davies v. Clarington (Municipality), 2009 ONCA 722, 100 O.R. (3d) 66 at para. 40.
5The conduct asserted here does not rise to a level justifying sanction, and is in any event disputed by the Respondents. While the Respondents’ position was found to have no merit, they were entitled to have their day in court to press their position.
6The Applicants seek partial indemnity costs up to the date of the offer in the amount of $105,813.60, and substantial indemnity costs thereafter to the date of the Reasons for Judgment in the amount of $121,106.97, totalling $226,920.44, and disbursements of $2,411.56. The total amount sought, therefore, is $229,332.13. Although not clearly stated, it appears from the Bill of Costs that the amounts for fees do not include HST.
7The Respondents argue that costs, on a partial indemnity scale, should be $50,000, relying on their Bill of Costs which totalled just $37,488.75 on a partial indemnity scale, not including disbursements of $429.00. The Applicant’s Bill of Costs, by contrast, claims a total of $201,333.80 on a partial indemnity scale, which is more than five times the Respondent’s Bill of Costs.
8I agree with the Respondents’ counsel that this was a relatively “straightforward application.” It involved the interpretation of a single clause in an asset purchase agreement. However, the Respondents vigorously contested the application, requiring an extensive record and cross-examinations. The Respondents are sophisticated businesses, and would reasonably have expected to face a large costs award if unsuccessful on the application which they chose to contest.
9Under the Courts of Justice Act, R.S.O. 1990, c. C. 43, s. 131(1), there is broad discretion in determining costs. Subrule 57.01(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, lists factors to be considered. In addition, the court should have regard to the principle of proportionality and seek to balance the indemnity principle with the objective of facilitating access to justice. The overall objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particular circumstances: Boucher v. Public Accountants Counsel for Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291 (C.A.).
10The awarding of costs is not an exact science. As the overarching principle is that costs must be fair, reasonable, and proportionate, the court need not engage in an exact measure or detailed analysis of the dockets: Boucher, at para. 26; Harley v. Harley, 2023 ONSC 4611, at paras. 34-35; Bender v. Dulovic, 2023 ONSC 4753, at paras. 24-25; Persampieri v. Hobbs, 2018 ONSC 368, at para. 33, citing Zesta Engineering Ltd. v. Cloutier (2002), 2002 25577 (ON CA), 21 C.C.E.L. (3d) 161 (Ont. C.A.), at para. 4; Brophy v. Harrison, 2019 ONSC 4377, at para. 15, citing Apotex Inc. v. Egis Pharmaceuticals (1991), 1991 2729 (ON CTGD), 4 O.R. (3d) 321 (C.A.).
11I find the amount sought by the Applicant to be reasonable. The disparity in the Bills of Costs is common when such Bills are submitted after the fact. It is well-accepted that Applicants’ costs are usually considerably higher as they must build the case as well as respond to defences raised. There were many hurdles to overcome, and the amount at stake was significant and amply justified the amount of costs incurred. In my view, the Respondents ought reasonably to have expected to face a bill similar to that presented by the Applicants.
12Accordingly, the Applicant shall be awarded costs for fees in the amount of $226,920.44, plus HST, and disbursements of $2,411.56.
Paul B. Schabas J.
Date: May 14, 2026