Hayes v. City of Saint John et al –, 2023 NBKB 040

SJC/533/2013 Citation: Hayes v. City of Saint John et al – 2023 NBKB 040 IN THE COURT OF KING’S BENCH OF NEW BRUNSWICK TRIAL DIVISION JUDICIAL DISTRICT OF SAINT JOHN BETWEEN: ROBERT HAYES, on behalf of himself and other class members, Plaintiff - and - THE CITY OF SAINT JOHN, a body corporate by Royal Charter, confirmed and amended by Acts of the Legislative Assembly of the Province of New Brunswick, Defendant BEFORE: Justice William T.

Grant HEARING HELD: Saint John DATE OF HEARING: February 3, 2023 DATE OF DECISION: March 14, 2023 SUBJECT MATTER: Costs on trial of Common Issues Ruling # 10 COUNSEL: Celeste Poltak, John McKiggan, K.C., Adam Tanel and Elie Weitzer for the Plaintiff Michael D. Brenton, K.C. and Emilie Jerome for the Defendant DECISION

GRANT J. [ 1 ] At the conclusion of this court’s decision on the trial of the common issues dated September 28, 2022, the court invited further submissions from the parties on the issue of costs of that trial. This ruling (Ruling # 10) should therefore be read in conjunction with that decision.

To be clear this ruling deals with costs of this proceeding since the conclusion of the certification motion and are in addition to any that I have previously awarded in this action. [ 2 ] The defendant was largely successful on the common issues trial so, if I follow the maxim that costs follow the event, the defendant is, prima facie , entitled to costs. There is a wide disparity between the parties on the question of what would be an appropriate costs order.

The plaintiff submits that this is a case where an order of no costs would be appropriate or, in the alternative, that I award the defendant costs of $25,000.00 including disbursements, i.e., the same award of costs I made on the certification motion in his favor. [ 3 ] The defendant submits that an order for costs in its favor is warranted in this case and that an award based on a multiple of the costs awarded for the certification motion (i.e., $25,000.00) would be appropriate. [ 4 ] The plaintiff bases his submission that there should be no costs awarded for the common issues trial on the following grounds: i. that it was a public interest claim which transcended the interests of the parties; ii. that this was a novel case; iii. that it promoted the principle of access to justice by permitting the plaintiff and claim members a forum for advancing their claim; iv. that this was clearly not a frivolous claim; and v. that there was divided success in the trial. [ 5 ] In his submission that this was a public interest claim, the plaintiff refers to Doucet v.

Spielo Manufacturing Inc. , 2011 NBCA 44 where Robertson, J.A., in considering “the importance of the issues” as referenced in Rule 59.02(

d) as a consideration in awarding of costs, stated at para. 128 in part: …. I read this criterion as applying to cases, for example, where the monetary issue may be relatively insignificant but the issues raised transcend the interests of the immediate parties and are of general importance in the law.

The person who advances a valid constitutional argument to recover a relatively large amount of money may not be burdened with the same level of costs awarded in a civil proceeding because of the public importance of the case. … [ 6 ] While this was a case of importance to the public in this community, it was not, in my view, one where the issues transcended the interests of the parties. In fact the main issue, whether or not the City was vicariously liable for the torts of Kenneth Estabrooks while he was a police officer, applied only to the parties and to that time period since it became moot when

section 17 of the Police Act, which came into effect in 1977, specifically made municipalities vicariously liable for torts committed by police officers but only for torts committed after it came into effect.

That said, I agree with the plaintiff’s submission that it was not a frivolous case in that, inter alia, he succeeded in the certification motion and it was important to the community, especially after the investigation commissioned by the defendant appeared to suddenly hit a dead end. [ 7 ] The plaintiff also submits that this was a novel case in terms of the facts and the proceeding, i.e., as a class action involving the serial abuse of children by a police officer. [ 8 ] The defendant submits that novelty is only a factor to be considered on costs if the plaintiff had a reasonable prospect of success, which he didn’t in this case. [ 9 ] While I agree that in the end the result, at least to this Court, was clear, it became so only after what Richard, C.J.N.B. described as a “… full debate within the context of the factual matrix of this case …”: see 2018 NBCA 5 at paragraph 55 .

I therefore find that the novelty of this case is a factor to consider in assessing costs in this case.

[ 10 ] The plaintiff also submits that the principle of access to justice is a factor I should consider in any costs award and refers to the court’s ruling (#6) on costs of the certification motion where, as here, the defendant argued that it was not a factor as the plaintiff was protected by a litigation funding agreement.

While in that ruling I found the litigation funding agreement was a neutral factor in assessing costs for the purpose of certification and access to justice was a factor to be considered, that does not mean that access to justice should insulate an unsuccessful plaintiff from a costs award on a common issues trial. [ 11 ] Once the case was certified as a class action proceeding the plaintiff’s access to justice was secured.

Following certification, particularly where, as here, there is a litigation funding agreement, access to justice is not a factor to which I would assign much weight in awarding costs. [ 12 ] In

summary, then, when I consider the submissions concerning public interest, the novelty of the case, the seriousness of it and the principle of access to justice, I am not persuaded that this is a case where I should depart from the norm and deprive the successful defendant of an award of costs. [ 13 ] Section 39(1) of the Class Proceedings Act, S.N.B. 2011 c. 125 states: 39(1) With respect to any proceeding or other matter under this Act, costs may be awarded in accordance with the Rules of Court. [ 14 ] Rule 59.01 sets out the authority for the court to fix costs. It reads as follows: 59.01 Authority of the Court

(1) Subject to any Act and these rules, the costs of a proceeding or 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.

(2) Nothing in this rule shall be construed so as to interfere with the authority of the court (

a) to fix the costs of a proceeding, or a step in a proceeding, with or without reference to a tariff, instead of requiring assessment of the costs, (

b) to allow or refuse costs in respect of a particular issue or part of a proceeding, (

c) to order costs to be assessed on a solicitor and client basis, or (

d) where parties are entitled to costs from each other, to order set-off of the costs. [ 15 ] Rule 59.02 of the Rules of Court sets out the factors to be considered by the Court in assessing costs as follows: 59.02 Costs of a Proceeding In fixing costs, the court may consider (

a) the amount claimed and the amount recovered, (

b) the apportionment of liability, (

c) the complexity of the proceeding, (

d) the importance of the issues, (

e) the conduct of any party which tended to shorten or unnecessarily lengthen the duration of the proceeding,

(

f) the manner in which the proceeding was conducted, (

g) any step in the proceeding which was improper, vexatious, prolix or unnecessary, (

h) any step in the proceeding which was taken through over caution, negligence or mistake, (

i) the neglect or refusal of any party to make an admission which should have been made, (j) … (k) … (

l) any other matter relevant to the question of costs. [16] Rule 59.08(1)(

a) states: 59.08 Fixing and Assessing Costs

(1) Subject to Rules 59.01 and 59.02, in rendering a decision or making an order (

a) after trial of an action, … the court rendering the decision or making the order shall fix the costs relating to fees for solicitors’ services in accordance withTariff “A” and direct by whom and to whom they are to be paid. [17] Unlike most cases following a trial, this one does not lend itself to application of the Tariff because there is no reliable evidence ofthe amount involved which is the starting point in fixing costs under the Tariff.

At the certification motion the plaintiff submitted that theamount involved was potentially as much as $26 million but no damages have yet been assessed and that submission was based on ananticipated class of dozens, if not hundreds, of members. Based on my findings on the common issues it is unlikely that the class willconsist of more than a handful of members which still is not helpful in determining an amount involved. [18] Moreover, it would be patently unfair to the defendant to assess its costs on the reduced class size since that reduction was, in nosmall part, due to its efforts.

In my view neither the amount involved, nor the Tariff are particularly helpful in assessing costs on thecommon issues trial. Rather, I find that in this case a lump sum award of costs is appropriate. [19] There is no New Brunswick case law to follow on the issue of costs following a trial on the common issues in a class proceeding soan appropriate award of costs which does not depend on the Tariff will depend largely on the peculiar facts of the case with guidancefrom the Rules of Court and any applicable jurisprudence on the issue of costs generally. [20] As Rosenberg J.A. stated in Pearson v.

Inco Ltd., (ON CA), 2006 Carswell Ont. 1527 costs should be fair andreasonable and while precedents are helpful, they “… will rarely provide firm guidance”. [21] It is clear from the Record in this case, much of which was submitted jointly, as well as the pre-trial briefs that both partiesexpended considerable effort in preparing for this trial and while the trial was comparatively short, in the end that was, in no smallmeasure, due to the pre-trial procedures, concessions and the fact that the complexities in this case were largely driven by differentinterpretations of the law to the facts which were themselves undisputed for the most part.

The direct examinations of the witnesses wereshort and the cross-examinations were either shorter or non-existent. Though the evidence was adduced over 5 days, the admissibleevidence only took 3 days and none of those were full days. [22] The issues clearly were important to both parties and that was reflected in their extensive preparation. The plaintiff madesignificant last minute concessions which, while they simplified the trial of the case, didn’t alter the fact that the defendant still had toprepare for the issues that were conceded.

[ 23 ] The major claim by the plaintiff involved the allegation that the defendant was vicariously liable for the abuse of dozens, if not hundreds, of children by Kenneth Estabrooks while he was a police officer and he was unsuccessful on this claim. Had he been successful this would have been, by his own submission on costs after the certification motion, a multi-million-dollar case. [ 24 ] Consequently the potential jeopardy for the defendant was considerable. On the other hand, the plaintiff’s success, which involved the claim that the defendant was vicariously liable for the abuse of Mr.

Hayes and other co-workers while they worked for the City, was modest by comparison. [ 25 ] The plaintiff also submits that any costs award to the defendant should be reduced because it didn’t concede that claim when asked to do so by the plaintiff in a letter dated February 9 th , 2021.

That request was not a formal Offer to Settle under the Rules of Court and it expired long before the trial began so the provisions of Rule 49 concerning the cost consequences of failing to accept an offer don’t apply. [ 26 ] However, the fact that the defendant unsuccessfully opposed that claim at the trial is a factor to be considered in assessing its costs, albeit a relatively small one compared to the result in the main claim of vicarious liability between 1953 and 1975. [ 27 ] The plaintiff further submits that this was not a particularly complex trial and while, from an evidentiary point of view there is merit to that submission, that only became apparent as the litigation proceeded. [ 28 ] He further submits that the defendant prolonged the trial because it wasn’t ready to proceed with its case when the plaintiff closed his but that was, in my view, a matter of scheduling its witnesses based on the anticipated length of the plaintiff’s case and while the evidence of both defence witnesses was almost entirely excluded in the end, it was not unreasonable, in my view, for the defendant to attempt to call them given the novelty of this case and the potential jeopardy the defendant was facing.

Moreover, in the end the extra time it took to do so was not significant. [ 29 ] The plaintiff was also critical of the defendant’s cross-examination of his witnesses but I found nothing inappropriate in those brief, and in two cases, non-existent cross-examinations.

The plaintiff was seeking a multi-million-dollar judgment and while the experience may have been difficult for some witnesses, the defendant had every right to pursue a vigorous cross-examination of them, though I would be hard-pressed to recall any witness whose cross-examination I would call particularly aggressive. [ 30 ] The plaintiff also submitted that his success should be measured by the fact that he succeeded on one of the four common issues covering 8 of the 30 years of the claims period.

However, I find that a more accurate method of measuring his success would be by comparing the likely number of class members involved in the claim on which he succeeded with the anticipated number on the whole claim that he was advancing and, while no damages have been assessed, it would be accurate in my view, based on that comparison to conclude that his success was modest. [ 31 ] Taking all those factors into account, I award costs to the defendant, the City of Saint John, in the amount of $37,500.00 plus all taxable disbursements for the trial of the common issues in this case. ________________________________________________ William T.

Grant Judge of the Court of King’s Bench

of New Brunswick