Douglas Gordon Bowman, Judith Darlene Bowman v. D.G. Bowman Systems Ltd., 2012 ABQB 205

Court of Queen ’ s Bench of Alberta Citation: Bowman v. Ralph ’ s Arctic Cat Sales & Services Ltd., 2012 ABQB 205 Date: 20120329 Docket: 0101 01674 Registry: Calgary Between: Douglas Gordon Bowman, Judith Darlene Bowman and D.G. Bowman Systems Ltd. Plaintiffs - and - Ralph ’ s Arctic Cat Sales & Services Ltd. and Randall Bowman Defendants _______________________________________________________ Reasons for Judgment of the Honourable Mr. Justice A. G.

Park (Costs Decision) _______________________________________________________ Facts [ 1 ] The Plaintiffs, Douglas Gordon Bowman, (“DB”), Judith Darlene Bowman, (“JB”), and D.G. Bowman Systems Ltd., (“DGBS Ltd.”), commenced an action based in negligence against the Defendants, Ralph’s Arctic Cat Sales & Services Ltd., (“Ralph’s”) and Randall Bowman, (“RB”), on January 29, 2001. [ 2 ] In the Statement of Claim DB alleged damages against both the Defendants on a joint and several basis as follows:

a) Non-Pecuniary damages in the sum of $250,000;

b) Damages in the amount of $50,000 for his past and future loss of housekeeping capacity;

c) Damages for his past and future cost of care expenses in the amount of $100,000;

d) Damages for his past and future loss of income in the amount of $1,000,000;

e) Tax gross up on the amounts described above;

f) Furthermore, or in the alternative, damages for his future loss of income earning capacity in the amount of $250,000;

g) G.S.T. due and owing on the amounts described above;

h) Management investment fees with respect to the amounts noted above;

i) Such further and other damages as may be proven at trial;

j) Pre-Judgment interest further to the provisions of the Judgment Interest Act , R.S.A. 1980, c. J-0.5 and amendments thereto;

k) Costs of this action; and

l) Such further and other relief as this Honourable Court deems fit to grant. [ 3 ] In the Statement of Claim JB alleged damages against both Defendants on a joint and several basis as follows:

m) Damages for her past and future loss of income in the amount of $1,000,000;

n) Such further and other damages as may be proven at trial;

o) Pre-Judgment interest further to the provisions of the Judgment Interest Act , R.S.A. 1980, c. J-0.5 and amendments thereto;

p) Costs of this action; and

q) Such further and other relief as this Honourable Court deems fit to grant.

[ 4 ] In the Statement of Claim DGBS Ltd. alleged damages against both Defendants on a joint and several basis as follows:

r) Damages arising from the per quod sevitium amisit claim in the amount of $1,000,000;

s) Such further and other damages as may be proven at trial;

t) Pre-Judgment interest further to the provisions of the Judgment Interest Act , R.S.A. 1980, c. J-0.5 and amendments thereto;

u) Costs of this action; and

v) Such further and other relief as this Honourable Court deems fit to grant. [ 5 ] Before the trial commenced JB advised she was not pursuing her cause of action. Accordingly she did not participate in the trial. [ 6 ] At the trial of this matter the Plaintiffs’ economic expert quantified the past and future loss of income claims in the range of $1,165,842 to a high of $2,795,295. [ 7 ] On November 9, 2007 the Defendants served a Formal Offer of Judgment in the amount of $50,000 plus pre-judgment interest, taxable costs and disbursements.

This offer was not accepted by the Plaintiffs. [ 8 ] On March 18, 2011 at trial I granted the Defendants’ application for a non-suit and the claims of DB and DGBS Ltd. were dismissed. [ 9 ] At trial one counsel represented both DB and DGBS Ltd. The Defendants were represented by two counsel. One of the Defendants’ counsel cross-examined the Plaintiffs’ liability witnesses. The second counsel provided support for that cross-examination.

Both Defendants’ counsel drafted the legal brief provided in support of the non-suit application. [ 10 ] Although the trial never proceeded beyond the non-suit application, the strategy of the Defendants’ counsel revolved around second counsel taking carriage of the damages component of the Plaintiffs’ claims. At the commencement of the trial the Defendants’ counsel believed the Plaintiffs would be calling four expert witnesses. In response the Defendants were prepared to call seven expert witnesses.

It is to be noted preparation for the examination of witnesses related to damages was commenced by the Defendants’ counsel prior to the non-suit application. [ 11 ] The Defendants now seek an Order for costs against all of the Plaintiffs. Rather than remitting the matter to an assessment officer under Rule 10.41 of the Alberta Rules of Court , I determined after hearing counsel for the parties that I would determine the costs under Rule 10.29(1)(a).

It states: 10.29(1) A successful party to an application, a proceeding or an action is entitled to a costs award against the unsuccessful party, and the unsuccessful party must pay the costs forthwith, notwithstanding the final determination of the application, proceeding or action, subject to (

a) the Court’s general discretion under rule 10.21

Other Alberta Rules of Court , which are relevant to this application, state: Costs consequences of formal offer to settle Rule 4.29(2) Subject to subrule (4), if a defendant makes a formal offer to settle that is not accepted and a judgment or order in the action is made that is equal to or more favourable to the defendant than the offer, the defendant is entitled to costs for all steps taken in the action in relation to the action or claim after service of the offer. Rule 4.29(4) This rule does not apply (

a) if costs are awarded under rule 10.31(1)(b), (

b) in the case of a formal offer to settle made with respect to an application for judgment after a

summary trial, if the offer is made less than 10 days before the date scheduled to hear the application for judgment, (

c) in the case of a formal offer to settle made with respect to any other matter, if the offer is made less than 10 days before the date scheduled for the trial to start, (

d) in the case of a formal offer to settle that is withdrawn in accordance with rule 4.24(4), or (

e) if in special circumstances the Court orders that this rule is not to apply.

Schedule “C ” Tariff of Recoverable Fees A: Division 1 Introduction Framework 1(1) This

Schedule specifies the lawyer’s fees that may be recovered as costs by one party from another.

(2) Each column of the tariff in Division 2 [The Tariff] gives a dollar amount range for the purpose of determining the lawyer’s fee under that column for the work described under each item.

(3) Subject to subrule(4), the dollar range indicates the amount recoverable (

a) as against the plaintiff, with reference to the amount claimed by the plaintiff, 10.33(1) In making a costs award, the Court may consider all or any of the following:

(

a) the result of the action and the degree of success of each party; (

b) the amount claimed and the amount recovered; (

c) the importance of the issues; (

d) the complexity of the action; (

e) the apportionment of liability; (

f) the conduct of a party that tended to shorten the action; (

g) any other matter related to the question of reasonable and proper costs that the Court considers appropriate.

(2) In deciding whether to impose, deny or vary an amount in a costs award, the Court may consider all or any of the following: (

a) the conduct of a party that was unnecessary or that unnecessarily lengthened or delayed the action or any stage or step of the action; (

b) a party’s denial of or refusal to admit anything that should have been admitted; (

c) whether a party started separate actions for claims that should have been filed in one action or whether a party unnecessarily separated that party’s defence from that of another party; (

d) whether any application, proceeding or step in an action was unnecessary, improper or a mistake; (

e) an irregularity in a commencement document, pleading, affidavit, notice, prescribed form or document; (

f) a contravention of or non-compliance with these rules or an order; (

g) whether a party has engaged in misconduct. Issues [ 12 ] In determining the appropriate level of costs recoverable by the Defendants, both parties expressed a number of concerns that fall broadly within two main issues: 1. What is the appropriate column for awarding costs in this matter?

and 2. Which disbursements are reasonably recoverable by the Defendants? Fee Column [ 13 ] In this case each of the Plaintiffs seeks relief by way of damages in the minimum amount of $1,000,000. The Plaintiff, DB, seeks total damages over $1,500,000. The Plaintiffs, JB and DGBS Ltd., seek in addition to the $1,000,000 damage award, pre-judgment interest under the Judgment Interest Act .

Although that legislation allows pre-judgment interest from the date of the cause of action until the trial date, the total amount of pre-judgment interest to be awarded to each of them, if they were successful at trial, would not exceed $500,000. In addition under the provisions of that legislation the Plaintiffs are not entitled to pre-judgment interest after the date of an offer not bettered.

As a result neither JB or DGBS Ltd. would have recovered a damage award in excess of $1,500,000 at trial. [ 14 ] In argument the Defendants pointed out, if all the amounts claimed for damages are totalled in all of the Plaintiffs’ prayers for relief, that sum amounts to a minimum of $3,650,000. [ 15 ] While all 3 Plaintiffs pursued one cause of action their respective claims are disparate. In my view each Plaintiff must be regarded as a single entity. Accordingly I will not total the entire joint amount of damages claimed by the 3 Plaintiffs as urged by counsel for the Defendants.

Rather I will treat each Plaintiff separately in determining which column of the tariff under

Schedule “C” will apply to that Plaintiff. [ 16 ] Respecting DB there can be no doubt that the damages claimed by him in the Statement of Claim are well over $1,500,000. Accordingly he will pay costs under Column 5. [ 17 ] DGBS Ltd.’s claim for damages is set out at $1,000,000 in the Statement of Claim. If pre-judgment interest was added to that $1,000,000 claim from the date of the accident until the date of the Defendants’ Offer of Judgment not bettered, the total amount of the damage claim of DGBS Ltd. would not exceed $1,500,000. As a result I will assess costs against DGBS Ltd. on the basis of Column 4 of

Schedule “C”, which ranges from $1,000,000 to $1,500,000. [ 18 ] Similar reasoning as set out in the prior para. respecting DGBS Ltd. applies to the Plaintiff, JB. Costs against her will be based on Column 4. [ 19 ] Setting costs under different columns for three singular and separate Plaintiffs is not unjust and unworkable as argued by counsel for the Defendants. Each Plaintiff is responsible for payment of the costs as assessed under the column selected. However, neither DGBS Ltd. or JB are liable for any costs over and above the amount set out in Column 4.

The extra costs rendered by employment of Column 5 against DB are not costs which DGBS Ltd. and JB are liable to pay. [ 20 ] In that same vein JB obviously is not liable for any costs incurred after the commencement of the trial. [ 21 ] In selecting the appropriate column for each of the three Plaintiffs, I do not accede to the argument put forth by counsel for the Plaintiffs. His argument centred on his advice to counsel for the Defendants that he was not pursuing the loss of income claim at trial on behalf of JB and DB. Rather the loss of income claim would be advanced at trial only through DGBS Ltd.

Without the loss of income claim he noted DB’s damages would be less than $500,000. JB, of course, was not participating in the trial. [ 22 ] Counsel for the Plaintiffs further pointed to the concession he made on behalf of DB at the opening of the trial. That concession involved the admission that DB’s claim was subject to a contributory negligence component, which in turn would reduce any damages to be awarded to DB. As a consequence of those two arguments counsel for DB submitted DB’s damages would be reduced

sufficiently to place DB in Column 3 of the Tariff. However no specific percentage was provided on the amount of contributorynegligence which should be assessed against DB. [23] In response counsel for the Defendants submitted the Supreme Court of Canada in the decision of D’Amato v. Badger, (SCC), [1996] 2 SCR 1071, prevented DGBS Ltd. from advancing a claim based on per quod servitium amisit. He argueddamages to a corporation cannot be awarded for the loss of services of an employee. In the case at bar DB was the sole shareholder,officer and director of DGBS Ltd.

DB was the injured party in this lawsuit. [24] I note that any damages to be awarded would flow through to the Plaintiff, DB, in any event. DB cannot hide behind theshelter of his corporation in order to reduce his damages claimed and be subject to a lower column in the Tariff. Those two argumentsadvanced by his counsel cannot succeed. His damages claimed, as noted earlier, are well over $1,500,000 and any abandonment of hisincome claim at the opening of the trial, and his recognition of an unspecified and unknown contributory negligence reduction, will notsucceed in placing him in a lesser column in the Tariff.

As I noted earlier, he will pay costs under Column 5. [25] The Defendants made a formal Offer of Judgment on November 9, 2007. It proposed payment of $50,000, pre-judgmentinterest and taxable costs and disbursements to November 9, 2007. It was not accepted. It was a genuine formal offer to settle. With thedismissal of the within action on the non-suit application the Defendants are entitled to rely on it. Under Rules 4.29(2) and (4), theDefendants are entitled to an order for double the costs after November 9, 2007.

There are no special circumstances present in this caseby which I could order that Rule would not apply. It does apply and I order a doubling of costs for all steps taken after November 9,2007. [26] In addition to the double costs award the Defendants asked me to award a multiplier of the

Schedule “C” tariff amounts. TheDefendants noted the 13 year old

Schedule “C” is a guide only and it is seldom a fitting guide for complex and protracted litigation.They submitted an award of costs should approximate 40 to 50% of reasonable solicitor and client costs. To achieve that level it wasargued a multiplier of

Schedule “C” tariff amounts must be awarded. In this connection counsel for the Defendants noted an award ofdouble Column 5 costs will not approach 50 % of his client’s solicitor client costs in this litigation. [27] In determining whether a multiplier of Column 5 should be awarded it is necessary to look to the damages claimed, theduration of the trial, the number of experts, the number of documents and the complexity of the issues. [28] In my opinion this is not a case where it is appropriate to apply the multiplier factor. An award of double costs willcompensate the Defendants adequately.

This case was not lengthy and did not involve multiple parties or numerous witnesses. Its issueswere not complex. It was equivalent to a motor vehicle accident, save and except, it involved an off road snowmobile vehicle. Further itwas not a frivolous action but one which held some merit despite the success of the non-suit application. All counsel were appropriate,ethical and conducted themselves properly. The litigation process cannot be criticized. The Plaintiffs did not increase the duration of thelitigation or complicate it.

There was no foundation established to allow an order of enhanced costs or to invoke an award of costs basedon a multiplier effect of the

Schedule “C” tariff. [29] Finally the Defendants submitted the taxed costs should be subject to an inflation factor. They referred to the decision ofMcMahon, J. in Marathon Canada Limited v. Enron Canada Corp., 2008 ABQB 770, where he, in recognizing a multiplier factorcould be applied to all tariff items in

Schedule “C” for costs, held an inflationary factor could be applied as part of the multiplier factor.He reached that conclusion by noting no inflationary factors have been applied since the 1998 establishment of

Schedule “C”. [30] In this case, where double costs have been awarded, I decline to award an inflationary factor. The tariffs in

Schedule “C” havebeen set. If the tariffs need to be adjusted to account for inflation, there is a mechanism available for such adjustments through legislationor amendments to the Alberta Rules of Court as opposed to discretionary and perhaps arbitrary decisions by the judiciary. In addition Iam guided by the reasoning of Belzil, J. in Brooks v. Stefura (1998), 1998 ABQB 440 , 222 A.R. 345 at 380, reversed on theother grounds, where he noted the various tariff items in

Schedule “C” are completed over the course of the litigation and it would posea problem to award the same inflationary increase to all the items on the basis those steps took place on the same day. In the case at bar,it was litigated over ten years. Finally Belzil, J. noted the provisions of Section 2(2)(

d) of the Judgment Interest Act which prohibit theawarding of interest on an award of costs in an action. [31] Counsel for DB objected to the claim of the Defendants in the Bill of Costs for the inclusion of a fee for the written argumentprovided by the Defendants in the non-suit application. It was not requested but I found it to be most helpful. It provided a detailed

analysis of the Plaintiffs’ evidence and the basis for the non-suit application. Its submission followed several days of trial. The non-suitapplication was serious and its success brought the trial to a close. It was not a frivolous application. Rather the application was based onan earnest and well researched brief citing proper legal authorities. It allowed me to consider properly the application, despite Plaintiffs’counsel’s argument that it was merely a superfluous non-requested solicitor’s brief.

I exercise my discretion and I allow the cost of thebrief of written argument. [32] A fee for second counsel for the Defendants in the trial has been included in the Bill of Costs. The Defendants submit in atrial of this nature a use of second counsel is appropriate. Second counsel for the Defendants was assigned to deal with the damagesportion of the trial. She cross-examined the treating physician for the Plaintiff in the trial.

She helped lead counsel for the Defendants inpreparation of the cross-examination of the Plaintiffs’ witnesses and I am advised she was involved very heavily in all aspects of thepreparation and the conduct of the trial. Counsel for the Defendants submitted the case involved a significant claim of some complexityon both liability and damages. There was a review of a number of documents. Overall counsel for the Defendants submitted the use ofsecond counsel allowed the case to be conducted efficiently.

I agree it was conducted efficiently and their work apportionment wasproper and understandable. [33] The Alberta Court of Appeal in Seidel v. Kerr, 2004 ABCA 157, addressed the issue of second counsel fees as follows: Costs for Second Counsel This Court in Alberta Productions v.

Canada Lands, 2003 ABCA 25 at para. 2 summarized the factors relevant to allowing secondcounsel fees: A number of factors have been recognized as relevant to the allowance of a fee for second counsel, including the general importance ofthe issue or issues to the parties or to others, the value of the case, the complexity and scope of the issues, the size of the trial record, themanner in which opposing counsel conducts the case and whether second counsel address the Court: Kassam v. Dragish, (1991), (AB KB), 49 C.P.C. (2d) 174, 123 A.R. 161 (Q.B.); Murray v.

Bitango (1996), (AB CA), 40Alta.L.R. (3d) 110 (C.A.); Mackie v. Wolfe (1996), 1996 ABCA 255 , 41 Alta.L.R. 28 (C.A.). [34] In my view in this litigation second counsel fees for the Defendant should not be allowed. Counsel for the Defendantsbasically split the case in half. One counsel worked on the liability issue and the other counsel worked on the potential damages issue.The trial issues involved some complexity and the final potential damages could have been significant. However, due to the success ofthe non-suit application the trial was not lengthy.

It was a convenient and prudent exercise for the Defendants to have two counsel but itwas not necessary. While I am appreciative that second counsel was instrumental in trial preparation, that was not trial work. At the trialsecond counsel played a minimal role compared to the Defendants’ lead counsel. The Plaintiffs had one counsel throughout the trial.Although non-suited he performed well and had no difficulties in putting forward the Plaintiffs’ case which was not protracted orextremely complex.

It is not reasonable for the Defendants to claim the expense of two counsel to carry on the proceeding when onecounsel handled the Plaintiffs’ case in an expeditious manner. Second counsel fees for the trial will be disallowed and struck from theBill of Costs. Disbursements [35] Disbursements made in the course of litigation are recoverable if they are reasonably incurred: Petrogas Processing Ltd. v.Westcoast Transmission Co., (1990), (AB KB), 105 A.R. 384 at para. 29.

Reasonableness is to be evaluated based onthe knowledge of the party at the time the disbursement was made and whether that disbursement can be deemed reasonable based onthose circumstances: Viridian Inc. v. Dresser Canada Inc., 1998 ABQB 687 at para. 4; SFP v. MacDonald, 1999 ABQB 322 at para.37; Edmonton Regional Airports Authority v. North West Geomatics Ltd., 2003 ABQB 280 at paras. 75-76; Sidorsky v. CFCNCommunications Ltd. (1995), (AB KB), 27 Alta.

L.R. (3d) 296 at para. 17. [36] The Plaintiffs have raised a number of concerns related to the reasonableness of disbursements made by the Defendants. [37] Mario Marocco of Access Building and Consulting Corp. was retained as an expert by the Defendants. Counsel for the

Plaintiffs took issue with Marocco’s travel time for flying from Edmonton to Calgary and return between the hours of 3:00 p.m. and12:00 a.m. Marocco’s invoice set out 10 hours for flying at his hourly rate of $80 per hour. In my capacity as an assessment officer I note3:00 p.m. to 12:00 a.m. is 9 hours and not 10 hours as billed. In addition Marocco billed $38 for lunch while he was consulting on thecase.

Accordingly I tax 1 hour off from his 10 hour claim in order to correspond to the time frame of 3:00 p.m. to 12:00 a.m. and I furthertax off the price of his lunch at $38 as he could not be consulting while he was eating his lunch. He would be expected to pay for hisown lunch while he was charging his hourly consulting rate of $80. His account is taxed down to $1,962.45. [38] Counsel for the Plaintiffs questioned the total amount of fees ($2,100) and disbursements ($531.90) charged by RitterInvestigation Services Ltd.

Charges for investigators are allowed where circumstances call for the skills of a private investigator,McCann v. Moss (1984), (BC SC), 58 B.C.L.R. 129 (SC), and where it is necessary or proper for the attainment ofjustice, Kenton v. Kento (1955), (BC SC), 16 W.W.R. 175 (BCSC). [39] The Alberta Court of Appeal in Sidorsky v. CFCN Communications Ltd., supra, stated at para. 4: In the ordinary case, witness tracking would be part of the preparation for trial and would be partially covered by an award of party andparty costs. This kind of expense cannot, without good reason, also be recovered as a disbursement.

Disbursements should not be used asa means, even unintentionally, of distorting the cost scheme by allowing, as a disbursement, fees for work normally considered part ofthe cost of litigation to which

Schedule “C” applies. [40] Accordingly, a party must show that the work done by an investigator could not have been accomplished by a lawyer in thenormal preparation for litigation. If not shown, the costs should be reduced or disallowed correspondingly. [41] In the current case, Ritter Investigation Services Ltd. was retained by the Defendants to find witnesses who participated in thesnowmobiling trip in which DB was injured.

Counsel for the Defendants argued that expense was necessary because the case progressedslowly over the course of many years and by the date a trial became highly likely, contact with the trip participants had been lost. [42] They maintained the $2,637.90 spent locating the witnesses was reasonable because the investigation firm was not requireduntil it became apparent its assistance would be essential once the trial became a certainty. In support of this position the Defendantsrelied on Kassam v.

Dragish, supra, in which Veit J. allowed the costs of an investigator who performed work that a lawyer could notand was able to provide useful information to the Plaintiffs in that case. [43] The Plaintiffs responded by noting the people on the expedition were all well-known to each other and the investigator wasused simply for expediency purposes for which the Plaintiffs should not have to pay.

Accordingly they objected to the entire expense. [44] The invoices provided by the investigation firm indicate that its fee includes internet searches, telephone inquires, interviewsand mileage. [45] I accept counsel for the Defendants’ advice that the investigation firm was instructed to locate, interview and obtainstatements from the snowmobiling trip participants despite the fact many of them were friends and acquaintances of the Defendant, RB.

Ifurther accept the advice that his law firm was not able to locate those witnesses and the efforts of the investigation firm enabled him todetermine which witnesses were intended to be called as defence witnesses at trial. It is a reasonable and proper expense. However acloser look at the investigation firm’s invoices demonstrate the automobile expenses charged were inconsistent, one to the other. Theinvestigation firm further billed disbursements for use of the local land line telephone, cellular telephone, non-described searches, andnon-described office disbursements.

Those disbursements totalled $537.90 in all of the invoices.

Those disbursements set out in theinvoices are not only inconsistent and unknown, they further fall within the disbursement description in the Sidorsky decision, supra.Accordingly the disbursements of $537.90 and the accompanying 5% Goods & Services Tax as included in the invoices are not allowedand are taxed off the Bill of Costs by me in my capacity acting as an assessment officer. [46] Counsel for the Plaintiffs asked to have the curriculum vitae provided for a gentleman named Mike Palumbo of SnowpeakRentals Ltd. in order that I could determine whether Palumbo could be qualified as an expert for the defence.

I have reviewed hiscurriculum vitae and I am satisfied that in all probability his qualifications, subject to any cross examination thereon, would allow him tobe qualified as an expert in snowmobiling. The amount set out in the final Bill of Costs is allowed for the charges of Snowpeak RentalsLtd.

[ 47 ] With respect to the expert, Mavis Andrew of Andrew O.T. Consulting Ltd., counsel for the Plaintiffs noted the last invoice dated March 15, 2011 included four hours of court preparation time charged at $250 per hour. The non-suit application was granted on March 18, 2011. Counsel for the Defendants advised in argument Ms. Andrew had been scheduled to provide evidence as an expert witness and an agreement was reached in the middle of the trial to enter her expert report by consent. As a result it would not be necessary for her to provide viva voce evidence.

However, he advised by the time the agreement was reached she had finished her four hours of trial preparation. I note Ms. Andrew’s fees were charged out at $150 per hour in an invoice of her company of July 17, 2009 and were raised to $200 per hour in a company invoice of December 29, 2010. On the last and contested invoice, some three months after the December 29 th , 2010 invoice, her hourly rate through the company had been raised to $250 per hour for her preparation to provide evidence on work she had previously completed in the two earlier invoices.

In the circumstances I intend to use my discretion and find a reasonable trial preparation time amount for her based on an invoice for trial preparation rendered three days before the non-suit application decision would be two hours at $250 per hour. Accordingly I tax $500 off from her last invoice in the circumstances. [ 48 ] Counsel for the Plaintiffs challenged the amount billed by one Hildebrand, who was retained by the Defendants to respond to the expert economic evidence provided by the Plaintiffs’ witness, Dr. Bruce. While Dr.

Bruce was retained for approximately $4,725, Hildebrand billed the Defendants $14,426.84. At more than three times the cost of Dr. Bruce, counsel for the Plaintiffs argued it would be excessive to allow all of the proposed costs for this expert. He argued there is an overriding principle for counsel to be reasonable in the retention of experts and to be reasonable in controlling the nature of the evidence and the cost of the expert’s fees. He noted Dr. Bruce’s invoices included investigating the matter, preparation of a report, preparation for trial and an attendance at trial to provide evidence.

He further noted Hildebrand’s responsibility was to review Dr. Bruce’s report and provide a rebuttal report. He argued it is the Plaintiffs’ expert who has the bigger task in assembling the information. He submitted Hildebrand’s fee, which is effectively three times the fee of Dr. Bruce, is excessive. [ 49 ] Counsel for the Defendants acknowledged there is a general duty for the parties to be reasonable in incurring costs in an action.

However, he noted what is to be judged to be reasonable in a particular case has to be considered in the context of the nature of the claim and from the perspective at the time the decision was made to incur the expense. It was argued the work completed and the money spent in the completion of the report was reasonable at the time bearing in mind the state of knowledge then existing. He noted Hildebrand had to reassess his report in light of undertaking information subsequently provided.

He referenced the voluminous documentation provided and the urgent response time thrust upon Hildebrand. [ 50 ] The Defendants argued unless there is a clear example of excess, the Court should be slow to second guess the decisions of counsel in the course of litigation.

They assert that the decision to retain Hildebrand was made in the context of building a full and proper defence, and was reasonably incurred at the time he was retained. [ 51 ] In particular, Hildebrand produced a report providing alternative estimates of the past and future income loss of the Plaintiff, DB, and calculations related to non-pecuniary damages. [ 52 ] However I find the Hildebrand fees as contained in the invoice of his company, Columbia Pacific Consulting, of December 31, 2010 are disproportionate as a rebuttal report when compared to the invoice for the originating report of Dr. Bruce.

The four invoices and accompanying letter of September 27, 2011 of Hildebrand addressed to counsel for the Defendants, and given to me in argument, provided little in the way of details in fleshing out the services provided by Hildebrand and his company. Dr. Bruce’s invoice for the initial report was approximately 28% of the Hildebrand company’s invoice. I cannot see in the material provided to me any reason to exercise my discretion and award a fee of over three times larger for a rebuttal report compared to the original report.

Accordingly I exercise my discretion and allow the fee for the Hildebrand company invoice of December 31, 2010 to be set at $5,000 rather than $8,997.50 as billed for the fees. That taxed amount remains at twice the amount of the Dr. Bruce invoice for the approximate same period. The remaining three invoices of Hildebrand are not nearly as disproportionate compared to Dr.

Bruce and they are allowed as set out in the invoices. [ 53 ] Counsel for the Plaintiffs took issue with the Defendants’ expert, a neurologist, who charged a fee of $9,500 for completing a medical legal report on the Plaintiff, DB, and preparing his anticipated trial testimony. Counsel for the Plaintiffs noted it was a two page report, which largely agreed with the opinion of DB’s expert.

It was submitted the Defendants’ expert completed more work than was required and as a result the costs related to him are excessive and should be disallowed. [ 54 ] Counsel for the Defendants justified the cost of his expert by noting the hourly rate is higher than the Plaintiffs’ expert because the Defendants’ expert was a neurologist and charged a higher hourly rate than the general medical practitioner expert of DB.

Counsel for the Defendants referred to the fact that DB’s general practitioner knew the Plaintiff prior to the injury and therefore was more familiar with the Plaintiff’s health and required less time familiarizing himself with the medical history.

Further, counsel for the Defendants argued it was necessary to have the testimony of a neurologist to discuss the seriousness of a spinal cord injury, as suffered by DB. [ 55 ] Finally, counsel for the Defendants noted the $9,500 invoice also included $1,250 for time associated with preparing for trial as it was not certain the non-suit application would prove to be successful before the time when the Defendants’ expert would embark upon his trial preparation. [ 56 ] The Defendants’ expert provided an invoice which detailed his efforts. His 15 hours of work was not an untoward amount.

The time spent by the Defendants’ expert was justified. Although he reached many of the same conclusions as DB’s expert, the time spent was necessary to allow him to review the extensive medical and hospital records of a hitherto unknown patient, unlike DB’s expert who was more familiar with the medical and hospital history of DB. The fee charged was necessary and reasonable due to the seriousness of the spinal cord injury suffered by DB.

The length of the Defendants’ expert report does not factor into the equation as much as the length of time it took him to assess properly and reasonably the medical status of DB. His concurrence with much of DB’s general practitioner opinions should not detract from the necessary time spent in assessing DB’s medical condition and status. It was reasonable for the Defendants to obtain a neurologist to examine the serious injuries and to determine the extent of the neurological damage. Further a neurologist’s hourly rate is obviously higher in most instances than the hourly rate of a general medical practitioner.

The fee charged by the Defendants’ expert was proper and reasonable and it is allowed. [ 57 ] Counsel for the Plaintiffs stated that he did not dispute the charges of Dr. Lesiuk, a physiatrist, other than any fees which may have been billed for trial preparation and trial attendance. Counsel for the Defendants responded by noting that none of the fee for experts included charges for anticipated work, only work that was actually completed. [ 58 ] Based on the two invoices issued by Dr. Lesiuk totalling $4,632, his work seems to be comprised of reviewing medical and legal documents, as well as drafting a report.

It does not appear that any time was billed either for trial preparation or his appearance in court. The costs associated with Dr. Lesiuk are allowed. [ 59 ] The Defendants retained a private court reporter for the trial. Counsel for the Plaintiffs queried whether the cost of such a reporter was one that an unsuccessful adverse litigant should be required to bear in light of the fact transcription services are available in this Court.

Counsel for the Defendants submitted the private court reporter was able to provide the trial transcription on an expedited basis which enabled transcripts to be available for both the defence and a courtesy copy to myself for the successful non-suit application. I agree the provision of the transcripts proved helpful to me in reaching my decision on the non-suit application. However the Court transcription services, Transcript Management Services, (TMS) can as well provide expedited transcripts. [ 60 ] TMS does not charge a sitting fee as does the private court reporter firm.

I am advised the court transcription service charges of TMS are approximately $750 for an expedited transcript provided within 2 days. [ 61 ] I am of the view a reasonable and proper disbursement in the circumstances would be to award the Defendants a court transcription disbursement in accordance with the service provided by the private court reporter firm. The cost of the transcripts from the private firm and TMS is approximately the same.

This includes the sitting fee charged on a half day basis by the private court reporter firm. [ 62 ] The invoice for the private court reporter firm totalled $7,663.85 for the trial, including a fee of $608.50 for the half day sitting of March 18, 2011. March 18, 2011 was the date I delivered my judgment on the non-suit application. That one half day was not necessary or reasonable for the Defendants to include in the Bill of Costs.

The disbursement for the private court reporting firm is allowed less the sum of $608.50 charged for the afternoon of March 18, 2011. [ 63 ] In the Bill of Costs the Defendants set out a disbursement of $7,580.90 for photocopying costs charged to them at their law firm. It charged 25​ per page for all photocopying which totalled 99 pages or less. After 99 pages were exceeded on a photocopying job the firm reduced its charge to 15​ per page.

The firm charged photocopying for correspondence to and from adverse counsel, to and from various witnesses, to and from various experts and potential witnesses, and to and from the Defendants. In this taxation the law firm

could reasonably account for approximately 20,000 pages in photocopying over the 10 years of litigation on this case. The issue in this taxation is not the number of pages photocopied but the explanation provided for the necessity of the photocopying and the rate charged per page. The common approach to photocopying and taxation in this court is to allow 15​ per page as a reasonable disbursement without evidence of higher costs. Photocopying costs should be a matter of sensible approximation. The total cost of $7,580.90 submitted by the Defendants equals 50,539 pages of photocopying at 15​ per page.

That is approximately 30,539 more pages than reasonably can be accounted for by the law firm. Accordingly I tax the photocopying disbursement at 20,000 pages at 15​ per page and I allow the disbursement of $3,000 for the Defendants’ black and white photocopies. [ 64 ] The Defendants set out a further disbursement of $1,342.25 for colour photocopies charged by their law firm at $1 per page. That would equal approximately 1,342 pages of colour photocopies. I was not provided with the costs of colour photocopies charged by the law firm on a per page basis.

In the absence of evidence as to the cost of colour photocopies to the law firm I allow a disbursement of 25​ per page. Accordingly I set the disbursement of $335.50 for the Defendants’ colour photocopies at 25​ per page for 1,342 pages. [ 65 ] A further disbursement of $510.20 was set out in the Bill of Costs for facsimiles charged to the Defendants by their law firm. The costs of facsimiles are recoverable “to the extent that they include any amounts paid to third parties, such as long distance charges”: Patterson v. Hryciuk , 2005 ABQB 136 at para. 67 .

Conversely, costs that are charged to the client to offset ordinary overhead costs for the maintenance of a facsimile machine are not recoverable as such charges do not constitute disbursements and should not be presented to a client as such on a statement of account. [ 66 ] Lacking any evidence that the facsimile charges appearing on the proposed Bill of Costs are based on third-party charges, these disbursements are disallowed. [ 67 ] Finally I note the Bill of Costs includes the sum of G.S.T. and H.S.T. calculated on disbursements and other charges.

An additional claim for G.S.T. and H.S.T. will not be allowed on any disbursement charges or other charges where the invoice for those particular disbursements or other charges previously has included a G.S.T. or H.S.T. charge or where the nature of the proposed G.S.T. or proposed H.S.T. charge does not allow a charge for such calculations. [ 68 ] In that both the Plaintiffs and the Defendants have enjoyed mixed success on this taxation of the Bill of Costs there will be no costs awarded to either on this application. Heard on March 7, 8, 9, 10, 11, 14, 15, 16, 17, 18, 21, 22, 23, 24, 25, and September 29, 2011.

Dated at the City of Calgary, Alberta this 29 th day of March, 2012. A.G. Park J.C.Q.B.A. Appearances: John E. Davison, Q.C. For the Plaintiffs

Paul J. Stein for the Defendants