LABRADOR-ISLAND LINK GENERAL PARTNER CORPORATION ACTING AS THE GENERAL PARTNER FOR THE LABRADOR-ISLAND LINK LIMITED PARTNERSHIP v. THE LABRADOR-ISLAND LINK LIMITED PARTNERSHIP, 2019 FC 850

Date: 20190624 Docket: T-772-17 Citation: 2019 FC 850 Ottawa, Ontario, June 24, 2019 PRESENT: Mr. Justice Lafrenière BETWEEN: LABRADOR-ISLAND LINK GENERAL PARTNER CORPORATION ACTING AS THE GENERAL PARTNER FOR THE LABRADOR-ISLAND LINK LIMITED PARTNERSHIP AND THE LABRADOR-ISLAND LINK LIMITED PARTNERSHIP Plaintiffs and PANALPINA INC., DESGAGNÉS TRANSARCTIK INC. AND LOGISTEC STEVEDORING INC. Defendants ORDER AND REASONS [ 1 ] By Judgment dated May 24, 2019, the three motions for

summary judgment brought separately by the Defendants were granted. The Defendants, Desgagnés Transarctik Inc. [Desgagnés], Logistec Stevedoring Inc. [Logistec] and Panalpina Inc. [Panalpina] sought to resolve the issue of costs of the proceeding with the Plaintiffs (hereinafter referred to in the singular as “Nalcor”). Although Nalcor agrees that the Defendants are entitled to their costs, it takes issue with the quantum claimed. The main points of contention are the following:

a) Whether the counsel fees for items related to steps taken in connection with the

summary judgment should be taxed according to Column III or Column IV;

b) Whether the Defendants are entitled to all the disbursements claimed; and

c) Whether Desgagnés is entitled to double costs following the settlement offer made in October 2017. A. Quantum of Cost [ 2 ] The Defendants submit that the taxing of counsel fees for items in relation to the motions for

summary judgment can justifiably be assessed on the basis of Column IV of Tariff B of the Federal Courts Rules , SOR/98-106 and that the costs relating to the present assessment should be taxed at the high end of Column III.

Panalpina seeks counsel fees in the amount of $26,640, Desgagnés and Logistec claim $27,900 and $23,340 respectively, and all three Defendants seek reimbursement of the applicable taxes. [ 3 ] Nalcor submits that the general rule is that costs should be assessed according to the mid-range of Column III and that the Court should only depart from this general rule exceptionally, and only in the event that certain criteria of Rules 400 and 407 warrant doing so. Nalcor maintains that the proceedings were not exceptionally complicated and there are no special circumstances justifying an elevated cost award.

I disagree. [ 4 ] Although the hearing of motions lasted less than one day and the parties cooperated in filing a common evidentiary record, there was a substantial amount of work performed by counsel for the Defendants including preparing affidavit evidence, conducting and/or participating in extensive cross-examinations of deponents, and drafting memoranda of fact and law raising numerous legal issues, all of which were inherently complex and time consuming. Further, the stakes were high for the Defendants.

Nalcor was seeking a substantial amount in the Statement of Claim (nearly $4,000,000); however, the amount it ultimately recovered as a result of the Defendants’ success on their motions is nil. In the circumstances, I am satisfied that costs of services related to the motions for

summary judgment should be calculated at the upper end of Column IV. [ 5 ] Nalcor does not dispute the services claimed by the Defendants in their Bills of Costs, except for the claims by Desgagnés and Panalpina under item 13 of Tariff B (Counsel for preparation for hearing of Motion for

Summary Judgment) and item 27 (Such other services as may be allowed by the assessment officer or ordered by the Court). [ 6 ] With respect to the units of 9 requested for item 13, Nalcor submits that the claim should be disallowed given that item 5 (Preparing and filing of contested Motion for

Summary Judgment) is a complete award of costs for counsel’s preparation to argue the motion for

summary judgment. I disagree. Preparing for a hearing is a separate and distinct task from preparing motion material.

Although the units claimed may appear high, they fall within a range of reasonableness. [ 7 ] As for the units of 4 requested for item 27 by Desgagnés and Panalpina, I agree with Nalcor that they should be disallowed given that the said Defendants have not provided any explanation or justification for the claim for services beyond those already claimed. [ 8 ] Finally I see no reason to depart from the mid-range of Column III in assessing costs relating to the present assessment as the parties were able to narrow the issues substantially to only a few contentious matters. B.

Disbursements [ 9 ] As for disbursements, Logistec claims the amount of $3,341.61, inclusive of taxes, for expenses relating to transcripts, photocopies,

scans, faxes, laser printing, courier charges and binding. Desgagnés claims $2,530.94 while Panalpina’s claim of $5,440.32 is for similar expenses. [ 10 ] Nalcor submits that the Defendants’ claim for photocopies and binding should only be allowed if they were required to advance the litigation. It contends that charges that exceed the actual cost of preparing documents should be disallowed as in many cases they are part of the firm’s overhead and contain an amount of profit.

According to Nalcor, costs for disbursements should be limited to $2,000.00 for each Defendant. [ 11 ] I am satisfied that the disbursements listed by the Defendants are reasonable. Although the photocopy costs claimed are substantial, I note that the motion records and books of authorities filed by the Defendants were quite voluminous. C. Double costs claimed by Desgagnés [ 12 ] On October 10, 2017, after the pleadings were closed and the parties exchanged affidavits of documents, counsel for Desgagnés served a formal settlement offer pursuant to Rules 419 to 422.

Desgagnés offered to pay the sum of $1,000, inclusive of interest and costs, to Nalcor in full and final settlement of Nalcor’s claims as against Desgagnés set out in the Statement of Claim and of any other claim Nalcor had or may have had against Desgagnés or anyone of its associated companies. There is no indication that the offer to settle was ever withdrawn. Desgagnés submits that it is therefore entitled to double costs pursuant to Rule 420. [ 13 ] Nalcor counters that Desgagnés has not met the requisite element of Rule 420 in that the settlement offer does not contain any element of compromise.

According to Nalcor, Desgagnés’ trivial offer in the context of a lawsuit of 3.7 million dollars was not a genuine attempt to resolve the action. I disagree. [ 14 ] There are four criteria to be met to trigger the double costs rule: MK Plastics Corporation v Plasticair Inc., 2007 FC 1029 , at paragraph 39 . First, an offer must be clear and unequivocal in that the opposite party need only decide whether to accept or reject the offer. Second, the offer must also contain an element of compromise or incentive to accept.

Third, the offer must be presented in a timely fashion such that the benefit would still be derived from the opposite party if accepted. Fourth, if accepted, the offer must bring the dispute between the parties to an end. [ 15 ] All four criteria are met in this case. The offer to settle was clearly worded. In fact, no ambiguity is suggested by Nalcor. Desgagnés’ offer did include an element of compromise in that it was willing to pay an amount of money to settle the action against as well as waive any claim for its costs incurred to the date of the offer.

The offer was made early in the proceeding, well before Desgagnés was required to expend substantial time and resources in bringing its motion for

summary judgment. Further, had Nalcor accepted the offer, the action as against Desgagnés would have been finally concluded. [ 16 ] The double costs rule exists to encourage the termination of litigation by agreement of the parties. This Court must give effect to Rule 420 to promote out-of-court settlement. Accordingly, I conclude that Desgagnés should be awarded double costs for fees incurred after the offer was made, excluding the costs relating to the preparation of the Statement of Defence and affidavit of documents, any settlement conference and the present assessment. D.

Conclusion [ 17 ] Rule 400(1) gives the Court full discretionary power over the amount and allocation of costs. A lump sum award is specifically contemplated in Rule 400(4), and may serve to promote the objective of the Federal Courts Rules of securing “the just, most expeditious and least expensive determination” of proceedings. [ 18 ] Recognizing that an award of costs is not an exact science and considering the submissions and the factors to which I have referred, I conclude that the Defendants should be awarded costs in a lump sum as reflected in the order below. ORDER IN T-772-17 THIS COURT ORDERS that : 1 .

The Plaintiffs shall pay Logistec’s costs hereby fixed in the amount of $30,000.00, inclusive of fees, disbursements and taxes. 2 . The Plaintiffs shall pay Panalpina’s costs hereby fixed in the amount of $33,000.00, inclusive of fees, disbursements and taxes. 3 . The Plaintiffs shall pay Desgagnés’ costs hereby fixed in the amount of $50,000.00, inclusive of taxes, plus $2,850.94 for disbursements. "Roger R. Lafrenière" Judge FEDERAL COURT SOLICITORS OF RECORD

DOCKET: T-772-17 STYLE OF CAUSE: LABRADOR ISLAND LINK GENERAL PARTNER CORPORATION ACTING AS THE GENERAL PARTNER FOR THE LABRADOR ISLAND LINK LIMITED PARTNERSHIP AND THE LABRADOR ISLAND LINK LIMITED PARTNERSHIP v PANALPINA INC., DESGAGNES TRANSARCTIK INC. AND LOGISTEC STEVEDORING INC. SUBMISSIONS ON COSTS CONSIDERED AT OTTAWA, ONTARIO PURSUANT TO THIS COURT’S JUDGMENT IN 2019 FC 740 ORDER AND REASONS: LAFRENIÈRE J. DATED: June 24, 2019 WRITTEN SUBMISSIONS BY : M e Shawn Faguy For The Plaintiffs M e Matthew Liben M e Richard Desgagnés M e Jean-Marie Fontaine For The Defendant, Panalpina Inc.

FOR THE DEFENDANT, DESGAGNÉS TRANSARCTIK INC. FOR THE DEFENDANT, LOGISTEC STEVEDORING INC. SOLICITORS OF RECORD : Faguy & Co. Barristers and Solicitors Montréal, Québec For The Plaintiffs Stikeman Elliott Barristers and Solicitors Montréal, Québec Bisset Bishop S.E.N.C. Montréal, Québec Borden Ladner Gervais Barristers and Solicitors Montréal, Québec For The Defendant, Panalpina Inc. FOR THE DEFENDANT, DESGAGNÉS TRANSARCTIK INC. FOR THE DEFENDANT, LOGISTEC STEVEDORING INC