r v. Cynthia Tanya Maria Looney, 2016 ONSC 1535

CITATION : Batchelor v. Cynthia Tanya Maria Looney, 2016 ONSC 1535 COURT FILE NO.: 01-3661/10 DATE: 2016 0303 SUPERIOR COURT OF JUSTICE - ONTARIO RE: Nancy Batchelor , Applicant AND: Cynthia Tanya Maria Looney aka Cynthia Tanya Maria Radawez and Jessica Jean Radawez, Estate Trustees with a will of the Estate of Bill Radawez, Respondents BEFORE: Madam Justice Darla A. Wilson COUNSEL: Ian M. Hull , for the Applicant Jeanie DeMarco, for the Respondents HEARD: By Written Submissions ENDORSEMENT on costs [ 1 ] This action proceeded through four days of trial in October 2015.

I delivered written Reasons for Judgment on November 17, 2015. The Applicant was awarded a lump sum payment of $450,000 from the Estate, tax free. I indicated to counsel that if costs could not be agreed upon, I would receive brief written submissions, following which I would fix the costs. That process has taken place. Positions of the Parties [ 2 ] The Applicant submits that costs ought to be awarded to her on a full indemnity basis on the basis of success at trial. Mr.

Hull submits that the Applicant made four different offers to settle prior to trial, which were less favourable to the Applicant than the judgment at trial. For reasons which are not clear, on October 6, 2015, the Applicant withdrew all offers to settle. The Respondents made two offers to settle, which were substantially less favourable to the Applicant than the trial result. [ 3 ] Counsel for the Applicant submits that the conduct of the Respondents in failing to recognize the common law relationship of the Applicant and Mr.

Radawez, refusing to grant access to the home for an appraisal and requiring a motion on the issue of the taking of the evidence of one of the witnesses was unreasonable and drove the costs up. Mr.

Hull argues that the aggressive, unreasonable conduct of the estate trustees justifies an award of costs on a higher scale. [ 4 ] The Applicant requests full indemnity costs in the sum of $425,272.81 inclusive of disbursements of $52,129.93 or, alternatively, on a substantial indemnity scale, costs of $387,958.52. [ 5 ] The Respondents submit that until shortly before trial, the Applicant was advancing claims on quantum meruit , constructive trust, resulting trust and unjust enrichment.

On the eve of trial, the Applicant abandoned these claims and proceeded solely on the issue of support for the Applicant under the Succession Law Reform Act , R.S.O. 1990, c. S.26. It is submitted that the Respondents are entitled to their costs of defending these claims, which should be set off against the Applicant’s costs of trial. [ 6 ] Ms. DeMarco submits that there was a duplication of work when the file was moved to new counsel.

The actual hours relating to the litigation are about 260; 144 hours of time was devoted to the unjust enrichment claims which were not pursued at trial, and therefore the Respondents ought not to have to pay for this. Furthermore, it is submitted that the quantum of costs sought is excessive and disproportionate to the value of the estate. The cost of the expert at $32,000 is excessive. Finally, with respect to the costs of the motions, no orders were made awarding costs to the Applicant. It is submitted that an award of costs of $50,000-$60,000 is appropriate in the circumstances.

Analysis [ 7 ] The offers to settle delivered by the Applicant are as follows: April 29, 2014: $330,000 all-inclusive on a time-limited basis, after which the offer was $375,000; July 23, 2015: $475,000.00 plus costs; September 18, 2015: $375,000 plus $25,498 for the dental work, $3,184.80 for the hearing aid plus costs of $166,830.38; October 5, 2015: $375,000 tax free payment plus $25,498.00 for the dental work, $3,184.80 for the hearing aid plus costs of $125,000 plus disbursements. [ 8 ] The offers to settle delivered by the Respondents were as follows: September 26, 2011: $100,000 all inclusive; October 2, 2015: 33.3% of the net estate including costs, with a value of the estate at approximately $800,000.00, or $266,400.00 all in. [ 9 ] Section 131(1) of the Courts of Justice Act , R.S.O. 1990, c.

C.43, provides as follows:

Subject to the provisions of

an Act or rules of court, the costs of and incidental to a proceeding or a step in a proceeding are in the discretion of the court, and the court may determine by whom and to what extent costs shall be paid. [ 10 ] Rule 57.01 of the Rules of Civil Procedure , O. Reg. 193/15, identifies the factors a court may consider when exercising its discretion to award costs:

(1) In exercising its discretion under

section 131 of the Courts of Justice Act to award costs, the court may consider, in addition to the result in the proceeding and any offer to settle or to contribute made in writing, (0.

a) th e 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; (0.

b) 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; (

a) the amount claimed and the amount recovered in the proceeding; (

b) the apportionment of liability; (

c) the complexity of the proceeding; (

d) the importance of the issues; (

e) the conduct of any party that tended to shorten or to lengthen unnecessarily the duration of the proceeding; (

f) whether any step in the proceeding was, (

i) improper, vexatious or unnecessary, or (ii) taken through negligence, mistake or excessive caution; (

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

h) whether it is appropriate to award any costs or more than one set of costs where a party, (

i) commenced separate proceedings for claims that should have been made in one proceeding, or (ii) in defending a proceeding separated unnecessarily from another party in the same interest or defended by a different lawyer; and (

i) any other matter relevant to the question of costs. [ 11 ] Rule 49.10 limits the court’s discretion on costs in certain circumstances when there has been a qualifying offer to settle:

(1) Where an offer to settle, (

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

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

(2) Where an offer to settle, (

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

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

c) is not accepted by the plaintiff, and the plaintiff obtains a judgment as favourable as or less favourable than the terms of the offer to settle, the plaintiff is entitled to partial indemnity costs to the date the offer was served and the defendant is entitled to partial indemnity costs from that date, unless the court orders otherwise. [ 12 ] Rule 49.13 provides as follows: Despite rules 49.03, 49.10 and 49.11, the court, in exercising its discretion with respect to costs, may take into account any offer to settle made in writing, the date the offer was made and the terms of the offer. [ 13 ] In Agius v.

Home Depot Holdings Inc. , 2011 ONSC 5272 , the court set forth the general principles to be applied in fixing costs, at paras. 10-12: Cumming J. in DUCA Financial Services Credit Union Ltd. v. Bozzo , 2010 ONSC 4601 , [2010] O.J. No. 3758 at para. 5 , described the

“normative approach” to an application for costs: Costs are in the discretion of the Court: s. 131, Courts of Justice Act, R.S.O. 1990, c. C.43 and Rule 57.01 of the Rules of CivilProcedure. In Ontario, the normative approach is first, that costs follow the event, premised upon a two-way, or loser pay, costsapproach; second, that costs are awarded on a partial indemnity basis; and third, that costs are payable forthwith, i.e. within 30 days.Discretion can, of course, be exercised in exceptional circumstances to depart from any one or more of these norms.

Fixing of costs is not merely a mechanical exercise in reviewing the receiving party’s Cost Outline. In Andersen v. St. Jude MedicalInc. (2006), (ON SCDC), 264 D.L.R. (4th) 557 (Ont. Div. Ct.), the Divisional Court set out several principles to beconsidered in making an award of costs: 1. The discretion of the court must be exercised in light of the specific facts and circumstances of the case in relation to the factorsset out in rule 57.01(1): Boucher, Moon, and Coldmatic Refrigeration of Canada Ltd. v. Leveltek Processing LLC (2005), (ON CA), 75 O.R. (3d) 638 (C.A.). 2.

A consideration of experience, rates charged and hours spent is appropriate, but is subject to the overriding principle ofreasonableness as applied to the factual matrix of the particular case: Boucher. The quantum should reflect an amount the court considersto be fair and reasonable rather than any exact measure of the actual costs to the successful litigant: Zesta Engineering Ltd. v. Cloutier(2002), (ON CA), 118 A.C.W.S. (3d) 341 (Ont. C.A.), at para. 4. 3.

The reasonable expectation of the unsuccessful party is one of the factors to be considered in determining an amount that isfair and reasonable: rule 57.01(1)(0.b). 4. The court should seek to avoid inconsistency with comparable awards in other cases. “Like cases, [if they can be found],should conclude with like substantive results”: Murano v. Bank of Montreal (1998), (ON CA), 41 O.R. (3d) 222(C.A.), at p. 249. 5. The court should seek to balance the indemnity principle with the fundamental objective of access to justice: Boucher.

The Court of Appeal has identified the overriding principle to be that the amount of costs awarded be reasonable in the circumstances. InDavies v. Clarington (Municipality) (2009), 2009 ONCA 722 , 100 O.R. (3d) 66 (Ont. C.A.) Epstein J.A. stated at paras. 51-52: As can be seen, the overriding principle is reasonableness. If the judge fails to consider the reasonableness of the costs award, then theresult can be contrary to the fundamental objective of access to justice.

Rather than engage in a purely mathematical exercise, the judgeawarding costs should reflect on what the court views as a reasonable amount that should be paid by the unsuccessful party rather thanany exact measure of the actual costs of the successful litigant. In Boucher [Boucher v. Public Accountants Council for the Province ofOntario (2004), (ON CA), 71 O.R. (3d) 291, [2004] O.J.

No. 2634 (C.A.)], this court emphasized the importance offixing costs in an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding at para. 37, whereArmstrong J.A. said “[t]he failure to refer, in assessing costs, to the overriding principle of reasonableness, can produce a result that iscontrary to the fundamental objective of access to justice.” [14] Regarding an award of substantial indemnity costs when Rule 49.10 does not apply, the court in Davies v. Clarington(Municipality), 2009 ONCA 722, 100 O.R. (3d) 66, noted, at para. 40: In

summary, while fixing costs is a discretionary exercise, attracting a high level of deference, it must be on the principled basis. Thejudicial discretion under rules 49.13 and 57.01 is not so broad as to permit a fundamental change to the law that governs the award of anelevated level of costs. Apart from the operation of rule 49.10, elevated costs should only be awarded on a clear finding of reprehensibleconduct on the part of the party against which the cost award is being made.

As Austin J.A. established in Scapillati, Strasser should beinterpreted to fit within this framework - as a case where the trial judge implicitly found such egregious behavior, deserving of sanction. [15] I have reviewed the Costs Outline submitted by counsel. I have considered the factors enumerated under Rule 57, includingthe time spent, the results achieved, and the complexity of the matter, and the principle of proportionality found in Rule 1.04(1.1). [16] Furthermore, I have taken into account the principles set forth by the Court of Appeal for Ontario in Boucher v.

PublicAccountants Council for the Province of Ontario (2004), (ON CA), 71 O.R. (3d) 291 (C.A.), specifically that theoverall objective of fixing costs is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particularcircumstances, rather than an amount fixed by actual costs incurred by the successful litigant. [17] In this case, there were no Rule 49.10 offers in place by the Applicant at the start of trial that would attract an elevated scaleof costs.

The Court of Appeal has made it clear that an award of elevated costs where there is no Rule 49 offer in place should only bemade on a clear finding of “reprehensible conduct”. While the behaviour of the Respondents was aggressive and bull-headed, I do notfind that it goes so far as to be deemed reprehensible. Clearly, the case could have been settled at an earlier stage without the necessity ofproceeding through trial had the Respondents been prepared to acknowledge the common law relationship that existed between theApplicant and their father. They did not; the matter went to trial and they were unsuccessful.

They must pay the cost of their decision, butthose costs must be reasonable. In my view, costs on a partial indemnity scale are appropriate and shall be fixed on that scale. [18] Ms. DeMarco is correct that the motion for interim relief heard December 21, 2012, and the motion for directions heardFebruary 8, 2013, did not award costs to the Applicant so those items do not properly form part of the Applicant’s costs demands. [19] The trial was less than four days with only one expert called by each side. The sum of $206,338.00 is sought on substantialindemnity scale for trial preparation.

In my view, this is an excessive amount given the nature of the issues in this action. There wasnothing unusual from a procedural point of view that would have driven up the costs. Mr. Hull is a very experienced counsel in the areaof estates litigation; he had litigated a similar issue concerning a common law spouse’s entitlement for support under the Succession LawReform Act, R.S.O. 1990, c. S.26 [see Morassut v. Jaczynski Estate, 2013 ONSC 2856, 2013 CarswellOnt 7377 [Estates List] aff’d 2015

ONSC 502, 57 R.F.L. (7th) 38 (Div. Ct)] so it is difficult to understand why so much trial preparation time was necessary. In my view,this was not a complex matter, although it was of great importance to all of the parties. The value of the estate was approximately $1million. Mr. Hull did an excellent, thorough job of presenting the Applicant’s case at trial. The trial time claimed is reasonable.

However, 35 hours to prepare the bill of costs is excessive. [20] Bearing in mind the principle of proportionality and considering the amount of costs the Respondents could reasonablyexpect to pay along with the other factors enumerated under Rule 57, I am of the view that the sum of $125,000 plus taxes is fair for thefees of the action and I fix them in that amount payable by the Respondents. [21] I turn now to the issue of disbursements.

The tariff provides for photocopying fees associated with making copies ofdocuments for the court. $10,000 in photocopying is excessive on this file and must be reduced to $6,500.00. The account fromTouchpointe in the sum of $36,665.68 is far too high. That is comprised of $18,927.50 for the report and a further $17,738.18 forpreparation and attendance at the trial. [22] The issue of the increasingly high accounts from experts is a troubling one. As Justice Edwards noted in Hamfler v.

Mink, (ON SC), at para. 18: These are just some of the questions that a trial judge may ask and which I have asked myself with respect to the necessity andreasonableness of the plaintiff’s bill of costs and in particular the list of disbursements. Fundamentally however, the court must as I havedone, direct itself to the question of whether the amount claimed is fair and reasonable. An expert can simply not charge what he or sheconsiders appropriate and then expect through counsel that such fee will be deemed acceptable by the court.

Reasonableness andfairness will dictate whether a disbursement, and in this case, whether an expert’s fee is assessable in whole or in part. [23] I agree. I accept that Ms. Harvey had to review the expenses of the Applicant and analyze them for use in the future, but theunsuccessful Respondents cannot be expected to pay the entire amount of her bill. That amount is not one that would have beencontemplated by the Respondents if they were unsuccessful at trial. I therefore reduce the account from Touchpointe to $25,000, which Iview to be reasonable in the circumstances.

Conclusion [24] I therefore order the Respondents pay to the Applicant her costs of this action fixed at $125,000 for fees plus HST plusdisbursements fixed at $35,387.20 plus HST. Darla A. Wilson J. Date: March 3, 2016