Jeoung Ho Kim Plaintiff - v. -, 2023 ABKB 8

Court of King’s Bench of Alberta Citation: Kim v 1522777 Alberta Ltd et al, 2023 ABKB 8 Date: 20230108 Docket: 1501 15445 Registry: Calgary Between: Jeoung Ho Kim Plaintiff - and - 1522777 Alberta Ltd and Jin Sook Hyun Defendants _______________________________________________________ Reasons for Judgment (Costs) of the Honourable Justice M.H. Hollins _______________________________________________________ [ 1 ] The Plaintiff, Mr. Kim, was leasing commercial space for a convenience store from his sister-in-law, the Defendant Ms. Hyun, through her numbered company, the Defendant 1522777 Alberta Ltd.

The Plaintiff sued successfully for breach of the lease, specifically the implied covenant of quiet enjoyment, based on the family members, including Ms. Hyun, having taken away the keys to the property during a confrontation. [ 2 ] However, notwithstanding the Plaintiff’s success on the question of liability, he recovered only $57,282 in damages in the face of a claim for $2.5M. Prior to trial, the Plaintiff’s expert witness on damages opined that the proper measure of damages was $1.114M.

When the Defendant’s expert pointed out an issue with how net profits were being calculated, the Plaintiff’s expert revised his

report to measure the damages as $287,109. Of this, I found that the Plaintiff’s actual recoverable damages were only $57,282. [ 3 ] The parties disagree on the costs disposition. The Plaintiff seeks

Schedule “C”, Column 1 costs of $35,429.70. The Defendant argues that both parties should bear their own costs. [ 4 ] Beginning with the presumption that a successful party is entitled to its costs, the Defendants bear the burden of establishing circumstances that would rebut that statutory presumption. Analysis [ 5 ] In this case, the Defendants point to two factors which they say should significantly reduce the costs payable to the Plaintiff, if not obviate them all together.

The first is an argument that there was mixed success at trial. [ 6 ] Although I dismissed the Defendants’ counterclaim for damages arising from their alleged breach of the lease, in their costs submissions, the Defendants say that they were not pursuing the counterclaim. No amendment to the pleadings were made prior to trial, nor any application to formally withdraw the counterclaim. It was dealt with in my Reasons for Decision. I agree that the counterclaim, at least on liability, did not add much to the trial time as it was really just the inverse argument of the Plaintiff concerning who breached the lease.

However, I do not agree that it had somehow disappeared by trial. Nor do I agree that there was “mixed success”. [ 7 ] The Defendants’ stronger argument is based on the limited degree of success of the Plaintiff. It should have been obvious to everyone involved that, even if successful, the Plaintiff’s damages would be generally confined to reliance, or out-of-pocket, damages.

The wildly inflated loss of profit figures simply did not comport with a business that was unprofitable for virtually its entire duration. [ 8 ] The Defendants also raise the fact that the Plaintiff made a formal offer of settlement for $1.1M and yet recovered only approximately 5% of that amount. They cite Bass v Boston Pizza International Inc, 2022 ABPC 26 , where Judge Higa awarded no costs based on the successful party’s minimal recovery at trial. However, more compelling to me is the fact that the Defendants made no such offer of their own.

It was open to them, if they knew the damages claimed were inflated, to make an offer of something less. Had they done so, they would be in a much better position on this application. [ 9 ] Notwithstanding the Plaintiff’s limited monetary success and my regret at all the resources these clients invested in a week- long trial only to be mutually disappointed, the Plaintiff is entitled to his costs as claimed with one exception. There will be no disbursements awarded in respect of the Plaintiff’s expert witness.

If the damage claim had been (professionally) calculated from the outset in the $200,000 range, it is reasonable to think that settlement discussions might have been more fruitful. [ 10 ] I do not see any entries on the draft Bill of Costs for the expert witness’ fees or attendance but if they are included, they should be deducted before Defendants’ counsel is presented with a final Bill of Costs. Conclusion [ 11 ] In conclusion, the Plaintiff is awarded costs of $35,429.70 less any expert witness fees. Heard on the 18 th day of November, 2022.

Dated at the City of Calgary, Alberta thi s 5 th day of January, 2023 M.H. Hollins J.C.K.B.A. Appearances: Ryan J. Barata and Sirisha J. Valupadas for the Plaintiff Jae Hun Shim and David Ly for the Defendants