Matthews v. Ocean Nutrition Canada Limited, 2022 NSSC 118

SUPREME COURT OF Nova Scotia Citation: Matthews v. Ocean Nutrition Canada Limited , 2022 NSSC 118 Date: 20220318 Docket: Hfx, No. 353606 Registry: Halifax Between: David Matthews Applicant v. Ocean Nutrition Canada Limited Respondent Decision Corrected Decision: The text of the original decision has been supplemented according to the attached Addendum dated April 26, 2022 Judge: The Honourable Justice Glen G.

McDougall Heard: October 30, 2020, February 22, April 29, May 27, July 14, 15, 2021, in Halifax, Nova Scotia Counsel: Blair Mitchell, for the Applicant Nancy Barteaux, Q.C. for the Respondent By the Court: Introduction [ 1 ] This is a decision on costs in a proceeding with a long and complicated history. On August 9, 2011, David Matthews filed a notice of application against his former employer, Ocean Nutrition Canada Limited (ONC), outlining claims for constructive dismissal and oppression, together with general and special damages, punitive and exemplary damages, and solicitor and client costs.

Over the ten years since the application was filed, a tremendous amount of time and effort has been expended to bring this matter to a final resolution. At times, the proceedings were not simply contentious, they were rather fractious. Unfortunately, this spilled over and affected the manner in which the parties’ counsel dealt with one another.

I am sure the parties and their counsel look forward to moving on. [ 2 ] It is necessary to review the matter’s history in some detail to explain how we all find ourselves here, dealing with costs on an application that was heard six years ago by another judge of this court. History [ 3 ] On July 29, 2011 , Blair Mitchell, counsel for Mr. Matthews, sent a demand letter to Martin Jamieson, CEO and President of ONC; Daniel Emond, the company’s COO; and David Brown, President and CEO of Richardson Capital Limited (through its ownership of various entities, Richardson Capital held 45% of the shares in ONC). Mr.

Mitchell was not aware at the time he prepared the letter that ONC had already retained Nancy Barteaux, Q.C., to represent it in any dealings with respect to Mr. Matthews. Mr. Mitchell advised that he had instructions from his client to bring a proceeding in the Supreme Court of Nova Scotia “in short order.” He further stated: In sum, and on a Without Prejudice basis, our client anticipates loss and entitlement [ sic ] compensation as follows: 1. Compensation - $700,000.00; 2. Loss of employment and notice over eighteen months - $270,000.00; 3. General Damages; 4.

Contribution to legal fees and expenses. [ 4 ] The notice of application filed on August 9, 2011 named ONC, Martin Jamieson, Daniel Emond, and Richardson Capital Limited as respondents.

[ 5 ] At a motion for directions on August 31, 2011, Justice Pickup directed that the notice of application be amended to properly name the Richardson entities that held shares in ONC. ONC took the position that none of Richardson Capital Limited, Martin Jamieson, or Daniel Emond should be named as respondents. It advised the court that it intended to bring three motions – one removing the respondents other than ONC, one seeking

summary judgment on evidence in regard to the claim of oppression, and a third to convert the matter from an application in court to an action. [ 6 ] ONC filed its notice of contest on September 22, 2011, and its three motions on November 17. The motions were set down for March 1, 2012. On February 21, Mr. Matthews made a formal offer to settle all his claims against ONC, other than costs and prejudgment interest, in the amount of $625,000. The offer was not accepted. The motions were heard on March 1 as scheduled. [ 7 ] On April 12, 2012, Justice Wood (as he then was) issued his decision on the motions.

ONC was successful in having all parties other than ONC removed as respondents. However, Justice Wood did not allow the

summary judgment motion nor did he allow the matter to be converted to an action. On April 26, ONC filed a notice of appeal. [ 8 ] ONC’s appeal was heard on November 20, 2012. It was dismissed on December 21. On January 31, 2013, ONC made a formal offer to settle – the applicant could dismiss his application in court without costs to either party. On February 1, Mr. Mitchell wrote to Ms. Barteaux refusing the offer. He did not make a counteroffer. [ 9 ] The application in court was not heard until November 2015.

The parties blame each other for the intervening delay, which included several disputes and motions about document production, discovery examinations, and other matters. This period will be examined in greater detail later. [ 10 ] The application was heard before Justice Leblanc on November 2, 3, 4, 5, 9, 10, 12, 13, 2015, and January 28, 2016. The parties filed post-hearing written submissions in April and May 2016. On October 12, Leblanc J. wrote to the parties asking, among other things, for any submissions on two decisions released by the Ontario Court of Appeal that were relevant to Mr.

Matthews’s claim under the long term incentive plan (LTIP). The parties filed their submissions in November and early December. [ 11 ] On January 4, 2017, the Alberta Court of Appeal also released a decision that was relevant to the LTIP issue.

Since both parties had relied on the lower court decision, Leblanc J. permitted them to file any additional submissions by January 20, which they did. [ 12 ] On January 30, 2017 , Justice Leblanc released his decision, finding that David Matthews had been constructively dismissed by ONC, and that he was entitled to 15 months’ reasonable notice along with compensation for the loss of the payout he would have received under the LTIP ($1,086,893.36, less applicable tax deductions) and the short term bonus plan (STIP) during the notice period. Justice Leblanc noted, however, that Mr.

Matthews had begun other, more lucrative employment with TASA on August 1, 2011, and that any salary or bonuses Matthews received in excess of what he would have earned at ONC during the notice period would have to be deducted from his damage award. Since Leblanc J. had no evidence as to the STIP amount or any bonuses or salary increases Matthews earned after starting with TASA, he left it to counsel to do the calculations. He added, however, that he would hear from them if they were unable to reach agreement.

Justice Leblanc directed that if the parties were unable to agree on costs, he would accept written submissions within 45 days of the release of his decision. [ 13 ] On February 21, 2017, ONC filed a notice of appeal alleging, among other things, that Justice Leblanc erred in his conclusions that Mr. Matthews had been constructively dismissed and that he was entitled to compensation for the loss of a payout under the LTIP. [ 14 ] The parties ultimately failed to reach agreement on costs or on the quantum of damages owing.

On April 20, 2017, they appeared before Justice Leblanc to make submissions regarding the STIP amount and prejudgment interest. At the hearing, the court invited counsel to make further written submissions, which they did. On May 12, Justice Leblanc issued his supplemental decision dealing with the STIP and prejudgment interest. The decision also held that ONC was to remit 50% of the judgment amount to the Canada Revenue Agency. [ 15 ] Prior to the parties completing their submissions on costs, it was announced that Justice Leblanc would be appointed Lieutenant Governor of Nova Scotia.

Justice Leblanc held a meeting with the parties on June 26, 2017, to advise that I would be assuming carriage of the matter to deal with costs. [ 16 ] A costs hearing had not occurred before ONC’s appeal was heard. The Court of Appeal released its decision on May 24, 2018. The majority affirmed Justice Leblanc’s findings that Mr. Matthews had been constructively dismissed and that he was entitled to a reasonable notice period of 15 months. The majority disagreed, however, with his conclusion that Mr. Matthews was entitled to damages on account of the lost LTIP payment.

In their view, the plain and unambiguous language of the LTIP deprived Mr. Matthews of the opportunity to recover under it once he left ONC. The Court of Appeal ordered Mr. Matthews to repay to ONC any amounts received from it, including any amount received under the LTIP. The Court of Appeal declined to award costs of the appeal to either party. [ 17 ] On August 22, 2018, Mr. Matthews filed an application for leave to appeal to the Supreme Court of Canada. Leave was granted on January 31, 2019. On February 14, I had a telephone conference call with the parties.

After hearing from counsel, I decided that the costs hearing should be adjourned pending the Supreme Court of Canada’s decision. [ 18 ] The appeal was heard on October 8, 2019. The Supreme Court of Canada’s unanimous decision, issued on October 9, 2020 , allowed the appeal, set aside the judgment of the Court of Appeal, and restored the trial judgment, “with costs throughout.” The Supreme Court of Canada held that Mr. Matthews was entitled to damages equal to what he would have received pursuant to the LTIP, subject to mitigation. [ 19 ] On October 30, 2020, I had a telephone conference call with the parties to

schedule a hearing to determine the costs that would be payable to Mr. Matthews, along with the duration for which prejudgment interest at 2.9% should apply to the damages awarded. I asked the parties to address these issues, along with the meaning of “with costs throughout”, in supplemental submissions. Mr. Matthews filed a supplemental brief and affidavit on December 17. Ms. Barteaux filed a reply on April 14, 2021. On April 27, Mr. Mitchell filed a second supplemental brief, which the court had neither requested nor previously agreed to accept. Ms. Barteaux filed a reply to that

submission on June 25. The hearing took place over two days beginning on Wednesday, July 14, 2021 and concluded the following day. Issues [ 20 ] The issues to be determined are: 1. What is the meaning of “with costs throughout”? 2. What should the applicant be awarded for costs ? a. Should the court depart from the tariffs and award a lump sum? b. Should costs be reduced due to the conduct of applicant’s counsel? c. Should costs be awarded against applicant’s counsel personally? 3. What should the applicant recover for reasonable disbursements? 4. Has the rate of prejudgment interest already been decided? 5.

For what period should prejudgment interest be awarded? 6. Should interest be awarded for the year during which Mr. Matthews had the award in his hands? Positions of the parties [ 21 ] Mr. Matthews seeks a lump sum award of costs in the range of $250,000 to $290,000 and disbursements in the amount of $16,189.53. He also seeks prejudgment interest from June 26, 2011 – the date he accepted his constructive dismissal and resigned from ONC. Mr. Matthews also seeks post judgment interest. [ 22 ] ONC submits that Mr.

Matthews should receive costs at Scale 1 (-25%) of Tariff A, plus six days of hearing, for a total of $64,887. It says disbursements should not be awarded because Mr. Matthews’s counsel has not filed any invoices with the court. ONC also seeks costs in the amount of $2,500, payable by Mr. Mitchell, in relation to his conduct at the main application hearing before Justice Leblanc, and a further $2,500, payable by Mr. Mitchell, “in relation to his incomplete and at times erroneous submission with respect to costs.” ONC says prejudgment interest should start when Mr.

Matthews would have become eligible for a payout under the LTIP and end on December 31, 2015, instead of the date of Justice Leblanc’s order, to account for delays caused by the applicant and those related to Justice Leblanc’s illness. Finally, ONC says interest should not accrue for the one year period when Mr. Matthews had the judgment in his hands, before the Court of Appeal ordered that it be repaid to ONC.

With costs throughout [ 23 ] The Supreme Court of Canada’s decision allowing the appeal ( 2020 SCC 26 ) concluded as follows: [89] For the foregoing reasons, I would allow the appeal, set aside the judgment of the Court of Appeal and restore the judgment of the Supreme Court of Nova Scotia, with costs throughout . [Emphasis added] [ 24 ] The Supreme Court of Canada has the power to make an order with respect to costs in lower courts pursuant to s. 47 of the Supreme Court Act , R.S.C., 1985, c.

S-26 : Payment of costs 47 The Court may, in its discretion, order the payment of the costs of the court appealed from, of the court of original jurisdiction, and of the appeal, or any part thereof, whether the judgment is affirmed, or is varied or reversed. [ 25 ] During one of the telephone conferences between counsel and the court, Mr. Mitchell advised that, based on his communication with court administration, the Court of Appeal would not revisit the issue of costs in that court on the basis that it is functus officio . Mr.

Mitchell suggested that this court could assess costs on the appeal on some sort of “informal” basis, in the interest of judicial economy. Ms. Barteaux took the position that this court has no jurisdiction to assess costs in a higher court. I asked the parties to provide further submissions on the issue prior to the hearing. In those submissions, Mr. Mitchell referred to Civil Procedure Rule 90.53, which provides: 90.53 Entry by prothonotary of certified order

(1) When an order of the Court of Appeal has been certified by the registrar to the prothonotary or clerk with whom the order appealed from was entered, the prothonotary or clerk must cause it to be filed, and all subsequent proceedings may be taken as if the certified order had been granted by the court appealed from.

(2) When an order of the Supreme Court of Canada has been certified by the registrar of that Court to the prothonotary or clerk with whom the order initially appealed from was entered, the prothonotary or clerk must cause it to be filed, and all subsequent proceedings may be taken as if the certified order had been granted by the court initially appealed from. [Emphasis added] [ 26 ] Mr. Mitchell submits that under Rule 90.53(2), the Supreme Court of Canada’s order that the applicant be awarded costs throughout is treated as if it had been granted by this court.

It follows, he says, that the issue of costs in the Court of Appeal becomes a matter for determination in the Supreme Court of Nova Scotia. [ 27 ] At the hearing, Mr. Mitchell advised that he had filed a separate motion to have this court assess costs at the Court of Appeal. He suggested that I set aside the matter of appeal costs until the other motion can be heard. I advised Mr. Mitchell that I had asked the parties for submissions on the issue because I intended to deal with it in this decision, and I will. [ 28 ] Ms.

Barteaux for ONC submits that a judge of the Supreme Court of Nova Scotia has no jurisdiction to award costs for the Nova Scotia Court of Appeal. ONC cites the Judicature Act , R.S.N.S. 1989 c. 240 , which provides that the Supreme Court of Nova Scotia will have those powers not assigned to the Nova Scotia Court of Appeal.

Section 7 of the Act provides that the Court of Appeal: shall exercise all the jurisdiction, powers and authority belonging to or exercised by the Supreme Court in banco before the first day of August, 1966, and the judges of the Court of Appeal shall exercise all the jurisdiction, powers and authority belonging to or exercised by a judge of the Supreme Court before that date in relation to the Supreme Court in banco . [ 29 ]

Section 8 provides that the Nova Scotia Supreme Court has: all the jurisdiction, powers and authority belonging to or exercised by the Supreme Court of Nova Scotia before the first day of August, 1966, and not assigned to the Court of Appeal by this or any other Act and the judges of the Supreme Court shall exercise all the jurisdiction, powers and authority belonging to or exercised by a judge of the Supreme Court of Nova Scotia before that date and not assigned to the judges of the Court of Appeal by this or any other Act. [Emphasis added] [ 30 ]

Section 13 states that the exercise of the assigned jurisdiction shall be in accordance with the Judicature Act and the Nova Scotia Civil Procedure Rules : The jurisdiction of the Court shall be exercised in the manner provided in this Act and the Rules and, where no special provisions are contained in this Act or the Rules, it shall be exercised in accordance with the practice and procedure followed by the Supreme Court of Nova Scotia before the first day of March, 1972. [ 31 ] Civil Procedure Rule 90.48(1) sets out the powers of the Court of Appeal: 90.48(1) Without restricting the generality of the jurisdiction, powers and authority conferred on the Court of Appeal by the Judicature Act or any other legislation the Court of Appeal may do all of the following: (

a) amend, set aside, or discharge a judgment appealed from; (

b) draw inferences of fact and give any judgment, allow any amendment, or make any order that might have been made by the court appealed from or that the appeal may require; (

c) make such order as to costs of the trial, hearing, or appeal as the Court of Appeal considers is in the interest of justice ; (

d) direct a new trial by jury or otherwise, on terms the Court of Appeal considers is in the interest of justice, and for that purpose order that the judgment appealed from be set aside; (

e) make any order or give any judgment that the Court of Appeal considers necessary. [Emphasis added] [ 32 ] ONC further submits that in Turner-Lienaux v. Campbell , 2004 NSCA 41 , the Nova Scotia Court of Appeal confirmed its exclusive jurisdiction over costs in that court when it stated at para. 44: Nor would it be appropriate for a trial judge to vary a costs order made by the Appeal Court… [ 33 ] ONC also refers to Bannon v. Thunder Bay , 2003 CarswellOnt 1158 (Ont.

C.A.) , a slip and fall case in which the Supreme Court of Canada restored a trial decision that had been reversed on appeal, and awarded the plaintiff her costs throughout. When the matter returned before the trial judge ( 2002 CarswellOnt 2801 ), the court noted: 3 Initially all counsel were of the view that as trial judge, I would be in the best position to assess all of the costs, including the proceedings before the Court of Appeal and the Supreme Court of Canada.

When I expressed my concerns about jurisdiction, it was conceded following further research by counsel, that this court did not have the jurisdiction to assess any costs related to proceedings before the Court of Appeal or the Supreme Court of Canada. However it was the position of counsel for the plaintiff that I would still have the jurisdiction to assess a risk plus premium in favour of the appellate counsel for the result that they obtained before the Supreme Court of Canada given the past circumstances of the case. [Emphasis added]

[ 34 ] Relying on Rule 57.01 of the Rules of Civil Procedure , R.R.O. 1990, Regulation 194 , which sets out the factors to be considered by the court when exercising its discretion to award costs, the trial judge went on to award the plaintiff costs on a “risk plus premium” basis. In reversing that decision, the Ontario Court of Appeal held that the trial judge had no jurisdiction to treat appellate proceedings as “incidental to the trial”: 1

Section 47 of the Supreme Court of Canada Act , R.S.C. 1985, c. S-26 , as amended, gives the Supreme Court of Canada express authority to "order the payment of the costs of the court appealed from . . . and of the appeal".

The Supreme Court of Canada made such an order in its judgment of February 21, 2002 [2002 CarswellOnt 549 (S.C.C.) ], in the following words: Consequently, we would allow the appeal with costs throughout, set aside the judgment of the Ontario Court of Appeal, and restore the judgment of Kozak J. at trial. 2 Kozak J. did not have the authority to order that the costs of the appellate proceedings be assessed on a "risk plus premium" basis.

We reject the submission that the breadth of jurisdiction of the trial judge pursuant to rule 57.01 is such that it can extend to treat appellate proceedings as incidental to the trial. Moreover, having given the power to award costs of appellate proceedings to the Supreme Court of Canada, there is no gap that would justify giving the trial judge some type of residual discretion to order such a premium. 3 The basis upon which costs were to be awarded in the appellate proceedings was a matter to be argued before the Supreme Court of Canada.

Even if Kozak J. had had the authority to make the order that he did -- which he did not -- the matter of costs having already been decided by the Supreme Court of Canada, he could not adjudicate upon it again. 4 The respondent is not precluded from advancing an argument in favour of such a premium in the appropriate forum(s). The costs of the proceedings in this court have yet to be assessed.

Should counsel for the respondent choose to pursue a claim for such a premium in the proceedings taken before this court, it would be appropriate that the matter be dealt with by a panel of this court rather than by an assessment officer. [Emphasis added] [ 35 ] ONC notes that Rule 90.53, cited by the applicant, has not been interpreted in the context of an order of the Supreme Court of Canada. It has, however, been interpreted in the context of an order of the Nova Scotia Court of Appeal filed with the Supreme Court of Nova Scotia. In Armoyan v.

Armoyan , 2014 NSCA 17 , the Court of Appeal made a costs order against Mr. Armoyan. Mrs. Armoyan took out an execution order for the awarded costs and obtained a discovery subpoena in aid of execution, but she was unable to serve Mr. Armoyan. As a result, she returned to the appeal court to seek an order for substituted service. Citing Rule 90.53, the Court of Appeal held that it did not have jurisdiction to enforce its earlier order: [8] As a result, following the issuance of an order by this Court, all “subsequent proceedings” may be taken as if the certified order had been granted by the Supreme Court.

To put it another way, a costs order of the Court of Appeal will be treated as a costs order of the Supreme Court if there are subsequent proceedings in relation to that order (other than, for example, if a party seeks to amend the order in accordance with Rule 90.50(2) or seeks to appeal the order). Logically it follows that if the subsequent proceeding is execution on that costs order, then this should occur in the Supreme Court in the first instance. This

interpretation would be consistent with the language of Rule 79, which expressly provides for Supreme Court judges and prothonotaries to take action with respect to executions rather than the Court of Appeal judges and the Registrar. [9] For this reason it is my view that the proper recourse for Ms. Armoyan is to seek an order for substituted service before the Supreme Court. [ 36 ] ONC submits that in Armoyan , the subsequent proceeding was in aid of the execution of a costs order that had already been made.

In the present case, the Supreme Court of Canada has ordered that costs be payable by ONC, but an assessment of those costs has not yet been made by the Court of Appeal. In essence, the Supreme Court of Canada has ordered costs be payable in both lower courts, but has remanded the decision on the assessment of costs to those courts. [ 37 ] In addition to the authorities provided by the parties, the court has considered Haynes Group of Lawyers v. Regan , 2001 NSCA 34 , which deals with the predecessor to Rule 90.53, and CCH Canadian Ltd. v.

Law Society of Upper Canada , 2004 FCA 278 , which addresses the meaning of “with costs throughout”. [ 38 ] The facts in Regan were as follows. In January 1995, the applicant Ms. Regan and the respondent law firm entered into a contingency agreement respecting services to be performed with respect to Ms. Regan’s personal injury action. The contingency agreement provided that if Ms. Regan discharged the firm prior to final recovery of compensation, she would immediately pay the lawyers all fees and disbursements calculated up to that time. [ 39 ] In October 1997, Ms.

Regan advised the firm that she had retained another lawyer and would no longer require its services. The firm submitted its bill for services. The bill was taxed before Davison J., who fixed the amount at $7,924.31. He ordered a modification to the contingency fee agreement to provide that no monies would be payable by Ms. Regan to the firm until the disposition of her personal injury action. He also ordered that there could be no enforcement of the bill prior to “successful disposition of this proceeding, and then only with the leave of this Honourable Court”.

The law firm appealed the order, asking that the limitation on its enforcement be deleted. In May 1998, the appeal was dismissed without costs, but the order of Davison J. was varied so as to permit the firm to obtain a charging order for its fees pursuant to the former Rule 63.26. [ 40 ] In May 1998, at the law firm’s request, the prothonotary issued a certificate of judgment showing a debt owing from Ms. Regan to the firm in the amount of $7,924.31. There was no dispute that Ms. Regan’s personal injury action had not yet concluded. The law firm recorded the certificate in the registry of deeds. When Ms.

Regan attempted to sell her house, an objection to title was made on the basis of the outstanding judgment. She then filed an application in the Court of Appeal to vacate the certificate of judgment. [ 41 ] Cromwell J.A. (as he then was) began his analysis by setting out Rule 62.29 (1):

[9] The foundation of Ms. Regan’s application is the Order of Davison, J. dated March 17th, 1998, and a Certificate of Judgmentissued by the Prothonotary on the 12th day of May, 1998. The Civil Procedure Rules specifically address the effect of a subsequentappeal on the order appealed from.

Rule 62.29(1) provides that where an order of the Court of Appeal which has been certified by theRegistrar to the Prothonotary or clerk with whom the order appealed from was entered, the latter shall thereupon cause it to be entered inthe proper book and “all subsequent proceedings may be taken thereon as if the order had been granted by the court appealed from”. Iset out Rule 62.29(1) for convenience: 62.29

(1) Where an order of the Court has been certified by the Registrar to the prothonotary or clerk with whom the order appealedfrom was entered, the latter shall thereupon cause it to be entered in the proper book and all subsequent proceedings may be takenthereon as if the order has been granted by the court appealed from. (emphasis added by Cromwell J.A.) [42] Justice Cromwell went on to find that, in light of Rule 62.29(1), the Court of Appeal had no jurisdiction to order the reliefsought by Ms.

Regan: [10] In my opinion, the Certificate of Judgment issued by the Prothonotary certifies the judgment of Davison, J. of the Supreme Courtas varied on appeal. The effect of the Order of the Court of Appeal, once transmitted to the Prothonotary of the Supreme Court, is topermit all proceedings to be taken with respect to that Order as if it had been made by the Supreme Court. This Rule … is, in myopinion, intended to leave matters relating to the enforcement of the Order, as varied if at all on appeal, to the Court that originally madeit.

While a chambers judge of this Court has the authority to amend the formal order for judgment to correct any errors or omission, orotherwise to better express the order’s intent: see Rule 62.26(2), in light of the explicit provision of Rule 62.29(1), I do not think that ajudge of this Court should issue directions to the Prothonotary, let alone the Registrar of Deeds, with respect to a Certificate of Judgmentbased on a judgment issued out of the Supreme Court and substantially affirmed on appeal.… [Emphasis added] [43] In Law Society of Upper Canada, the defendant Law Society brought a motion for increased costs against the plaintiffpublishers.

The publishers had brought an action for copyright infringement against the Law Society for providing copies of thepublishers’ reported judicial decisions and other legal works to its members and for permitting patrons of its library to make photocopiesof those materials. The action reached the Supreme Court of Canada, which ruled in favour of the Law Society and awarded it coststhroughout. The publishers submitted that an award of increased costs was not within the Federal Court of Appeal's jurisdiction and thatthe Law Society would have to seek such an order from the Supreme Court of Canada.

The publishers further submitted that the award ofcosts throughout precluded an award of increased costs. [44] In rejecting both the publishers’ arguments, Rothstein J.A., for the court, said the following about an award of “coststhroughout” in the Supreme Court of Canada: [15] As to the publishers' first argument, nothing in the judgment of the Supreme Court expressly or implicitly reserves to the SupremeCourt the exclusive authority to award increased costs.

Rather, an award of "costs throughout" by the Supreme Court remits to therespective lower courts the determination of costs in respect of the proceedings in each Court, according to the rules of each lower court. [16] Turning to the publishers' second argument, when the matter of costs is remitted to this Court after a judgment of the SupremeCourt awarding costs, the only fetter on the discretion conferred upon this Court in respect of costs is that this Court may not exercise itsdiscretion in a manner inconsistent with the award of costs by the Supreme Court of Canada.

This approach was succinctly explained byStrayer J.A. in Eli Lilly and Co. v. Novopharm Ltd. (1998), (FCA), 85 C.P.R. (3d) 219 at paragraph 5 (F.C.A.): Clearly there are some discretionary powers under Rule 400 which cannot be exercised in the face of an award of costs ordained by theSupreme Court. For example, this Court could not, in the face of such a direction, refuse costs or award them instead to the unsuccessfulparty.

But, in my view, any discretionary power granted by the Federal Court Rules whose exercise is not inconsistent with the award ofcosts by the Supreme Court can be exercised in giving effect to an award of costs in this Court by the Supreme Court on appeal. [17] In my view, when the Supreme Court makes an award of "costs throughout," the direction to this Court is neutral, in the sensethat, as long as costs are awarded, the Supreme Court is leaving it to this Court to decide on the appropriate amount of costs.

Under sucha direction, when the matter of costs is remitted to this Court, costs are to be assessed in accordance with the Rules of this Court whichallow for the awarding of increased costs (see rules 400(1) and (4)). [Emphasis added] [45] Having considered all of the authorities, I find this court has no jurisdiction to assess appeal costs. That jurisdiction is assignedexclusively to the Nova Scotia Court of Appeal pursuant to the Judicature Act and Civil Procedure Rule 90.48(1)(c).

I agree with theview expressed in Law Society of Upper Canada that when the Supreme Court of Canada makes an award of “costs throughout”, thatorder remits to the respective lower courts the determination of costs in respect of the proceedings in each court, according to the rules ofeach lower court. Rule 90.53(2) does not change that. [46] Under Rule 90.53(1), an order of the Court of Appeal will be treated as an order of the Supreme Court if there are “subsequentproceedings in relation to that order”.

As noted in Regan and Armoyan, that would include proceedings to enforce the order, but not toamend or appeal its contents. In other words, the order of the Court of Appeal is not treated as an order of the Supreme Courtfor all purposes. If it were, the Supreme Court would have jurisdiction to amend what is, in effect, its own order. In sum, Rule 90.53(1)does not confer on the Supreme Court the jurisdiction to deal with the content of the order because that jurisdiction is assignedexclusively to the Court of Appeal.

It follows that the filing of an order of the Supreme Court of Canada which includes an award of“costs throughout” with the Supreme Court of Nova Scotia pursuant to Rule 90.53(2) does not expand the latter’s jurisdiction to includethe power to assess costs in the Court of Appeal.

[ 47 ] Accordingly, the remainder of my decision will deal only with the assessment of costs in relation to the proceedings in this court. Costs [ 48 ] Mr. Matthews submits that a costs award fixed in accordance with the tariffs would not amount to a substantial contribution to his reasonable legal fees and expenses. He seeks a lump sum award of party and party costs in the range of $250,000 to $290,000. If the court declines to award a lump sum, Mr.

Matthews asks in the alternative for increased tariff costs. [ 49 ] ONC says lump sums should only be awarded where there is reason to do so, and there is no such reason in this case. ONC asks the court to exercise its discretion to apply Scale 1 (-25%) of Tariff A due to the manner in which Mr. Mitchell advanced his client’s case, which caused unnecessary expense and delays. [ 50 ] The law on costs is uncontroversial. The court has considerable discretion when fixing costs. Civil Procedure Rule 77 provides in part: 77.01 Scope of Rule 77

(1) The court deals with each of the following kinds of costs: (

a) party and party costs, by which one party compensates another party for part of the compensated party’s expenses of litigation; (

b) solicitor and client costs, which may be awarded in exceptional circumstances to compensate a party fully for the expenses of litigation; (

c) fees and disbursements counsel charges to a client for representing the client in a proceeding.

(2) Costs may be ordered, the amount of costs may be assessed, and counsel’s fees and disbursements may be charged, in accordance with this Rule. 77.02 General discretion (party and party costs)

(1) A presiding judge may, at any time, make any order about costs as the judge is satisfied will do justice between the parties.

(2) Nothing in these Rules limits the general discretion of a judge to make any order about costs , except costs that are awarded after acceptance of a formal offer to settle under Rule 10.05, of Rule 10 - Settlement. 77.03 Liability for costs

(1) A judge may order that parties bear their own costs, one party pay costs to another, two or more parties jointly pay costs, a party pay costs out of a fund or an estate, or that liability for party and party costs is fixed in any other way.

(2) A judge may order a party to pay solicitor and client costs to another party in exceptional circumstances recognized by law.

(3) Costs of a proceeding follow the result, unless a judge orders or a Rule provides otherwise. [Emphasis added] [ 51 ] Rule 77.06 provides that, unless ordered otherwise, party and party costs are quantified according to the tariffs. Under Rule 77.07(1), the court has discretion to raise or lower the tariff costs, applying factors such as those identified in Rule 77.07(2): 77.07 Increasing or decreasing tariff amount

(1) A judge who fixes costs may add an amount to, or subtract an amount from, tariff costs.

(2) The following are examples of factors that may be relevant on a request that tariff costs be increased or decreased after the trial of an action, or hearing of an application: (

a) the amount claimed in relation to the amount recovered; (

b) a written offer of settlement, whether made formally under Rule 10 - Settlement or otherwise, that is not accepted; (

c) an offer of contribution; (

d) a payment into court; (

e) conduct of a party affecting the speed or expense of the proceeding; (

f) a step in the proceeding that is taken improperly, abusively, through excessive caution, by neglect or mistake, or unnecessarily; (

g) a step in the proceeding a party was required to take because the other party unreasonably withheld consent; (

h) a failure to admit something that should have been admitted. [ 52 ] Rule 77.08 permits the court to award lump sum costs but does not specify the circumstances when such an award is appropriate. That guidance is found instead in the case law. In Armoyan v. Armoyan , 2013 NSCA 136 , the Court of Appeal, per Fichaud

J.A., explained that a lump sum award will be appropriate in cases that bear no resemblance to the tariffs’ assumptions: [15] The tariffs are the norm, and there must be a reason to consider a lump sum. [16] The basic principle is that a costs award should afford substantial contribution to the party’s reasonable fees and expenses. InWilliamson, while discussing the 1989 tariffs, Justice Freeman adopted Justice Saunders’ statement from Landymore v.

Hardy (1992), (NS SC), 112 N.S.R. (2d) 410: The underlying principle by which costs ought to be measured was expressed by the Statutory Costs and Fees Committee in these words: “… the recovery of costs should represent a substantial contribution towards the parties’ reasonable expenses in presenting or defendingthe proceeding, but should not amount to a complete indemnity.” Justice Freeman continued: In my view a reasonable

interpretation of this language suggests that a “substantial contribution” not amounting to a complete indemnitymust initially have been intended to mean more than fifty and less than one hundred per cent of a lawyer’s reasonable bill for the servicesinvolved. A range for party and party costs between two-thirds and three-quarters of solicitor and client costs, objectively determined,might have seemed reasonable.

There has been considerable slippage since 1989 because of escalating legal fees, and costs awardsrepresenting a much lower proportion of legal fees actually paid appear to have become standard and accepted practice in cases notinvolving misconduct or other special circumstances. [17] The tariffs deliver the benefit of predictability by limiting the use of subjective discretion. This works well in a conventional casewhose circumstances conform generally to the parameters assumed by the tariffs.

The remaining discretion is a mechanism forconstructive adjustment that tailors the tariffs’ model to the features of the case. [18] But some cases bear no resemblance to the tariffs’ assumptions. A proceeding begun nominally as a chambers motion, signallingTariff C, may assume trial functions, contemplated by Tariff A. A Tariff A case may have no “amount involved”, other important issuesbeing at stake. Sometimes the effort is substantially lessened by the efficiencies of capable counsel, or handicapped by obstructionism. The amount claimed may vary widely from the amount awarded.

The case may assume a complexity, with a corresponding workload,that is far disproportionate to the court time, by which costs are assessed under provisions of the Tariffs. Conversely, a substantial summay turn on a concisely presented issue. There may be a rejected settlement offer, formal or informal, that would have saved everyonesignificant expense. These are just examples.

Some cases may combine several such factors to the degree that the reflexive use of thetariffs may inject a heavy dose of the very subjectivity – e.g. to define an artificial “amount involved” as Justice Freeman noted inWilliamson – that the tariffs aim to avoid. When this subjectivity exceeds a critical level, the tariff may be more distracting than useful. Then it is more realistic to circumvent the tariffs, and channel that discretion directly to the principled calculation of a lump sum.

Aprincipled calculation should turn on the objective criteria that are accepted by the Rules or case law. [Emphasis added] [53] Fichaud J.A. went on to note: [29] The propriety of a lump sum award may be tested by comparing the proposed tariff award to the actual legal fees and expenses. Mr. Armoyan’s calculation under the tariffs is $117,714.64. Even after the adjustments that I will discuss later, Ms. Armoyan’s legalfees and disbursements exceed $450,000 for the Nova Scotia forum conveniens proceeding and both appeals.

A recovery of about 27%does not approach the “substantial contribution” that Justice Freeman contemplated in Williamson. [Emphasis added] [54] The Armoyan decision was applied in Andrews v. Keybase Financial Group Inc., 2014 NSSC 287, where Wright J. held that anaward of $310,000 was a substantial contribution to actual legal fees of $469,349: [30] In similar fashion to Williamson, Justice Fichaud [in Armoyan] tested the propriety of a lump sum award by comparing theproposed tariff award to the actual legal fees and expenses to be charged to the client.

He concluded that a recovery of about 27% didnot approach the “substantial contribution” that Justice Freeman had contemplated in Williamson.

Hence, a lump sum was appropriatewhich the Court then fixed at a total amount of $306,000 (including disbursements) measured against solicitor-client legal fees anddisbursements in the aggregate of approximately $477,000. [31] Bearing these principles in mind, as well as the representation by plaintiffs’ counsel that the solicitor-client fees would be similarwhether computed under the contingency fee agreements or by time records, I conclude that this is clearly a case where a lump sumaward of costs should be made so as to effect a substantial contribution to the plaintiffs’ legal expenses.

Considering as well the threefactors identified earlier in this decision in common with the Williamson case, I am of the opinion that an appropriate award of lump sumcosts to be made here is $310,000 representing a rounded recovery of 66% of the solicitor-client fees of $469,349 (recognizing that thelatter figure does not include the contingency fee recovery on the costs award itself). [55] In this case, Mr. Mitchell has filed time records with fees totaling $427,000. He says Mr.

Matthews has paid $237,502 to date.An award under Scale 2 of Tariff A using an “amount involved” of $1,086,893.36 would be $70,648, to which must be added $2,000 perhearing day. The parties disagree on the number of hearing days, with Mr. Matthews submitting that there were at least eight ($16,000),and ONC saying there were six ($12,000). In either case, Mr. Mitchell says, an award under the tariffs would not represent a substantialcontribution to his client’s actual legal fees. [56] To bolster his position that fees of $427,000 are reasonable in the circumstances, Mr.

Mitchell refers to a letter he receivedfrom Ms. Barteaux, dated August 17, 2015, which contained the following paragraphs:

Despite ONC’s strong belief that it will be successful, it is prepared to offer Mr. Matthews an opportunity to limit his losses which, when he fails to prove the claims he has made in his Amended Notice of Application in Court, will likely result in him being ordered to pay a very significant cost award since ONC will be entitled to receive a substantial contribution to its legal fees. The terms of the offer are set out below. To ensure that you and Mr.

Matthews appreciate the magnitude of the cost award at stake, we are informing you that by the conclusion of the hearing ONC’s legal fees will likely exceed $400,000, plus disbursements of approximately $15,000. This is clearly not a matter that will fall under the Tariffs (which under the basic scale would yield a cost award of approximately $82,650).

Rather, should this proceed to a hearing in November, ONC anticipates that it will be seeking a lump sum cost award that represents approximately two- thirds of the legal fees it has incurred plus reimbursement for all disbursements (i.e. a total sum of $290,000). [ 57 ] The letter also included a formal offer to settle which provided that ONC would consent to the dismissal of Mr. Matthews’s claims against it in exchange for a payment to ONC of $25,000 in costs. [ 58 ] Ms. Barteaux submits that her estimate of ONC’s fees cannot be used by Mr.

Mitchell to justify his own billings because ONC carried a much heavier burden with respect to the evidence. She points out that ONC drafted more than twice as many pages of affidavit evidence and written submissions as Mr. Matthews, and that, if exhibits are added into the calculation, ONC filed more than 10 times the volume of material as Mr. Matthews. I agree with Ms. Barteaux that her pre-hearing estimate of ONC’s fees should not be used to justify Mr. Mitchell’s fees, both for the reason she cited and because, as will become clear, I find that Mr.

Mitchell’s conduct of this litigation created more work for ONC than would otherwise have been necessary. [ 59 ] In any event, Mr. Mitchell conceded at the hearing that his time records contained numerous irrelevant entries, including items unrelated to this file and entries related to interlocutory proceedings for which costs orders have already been made. Ms. Barteaux prepared a colour-coded version of Mr. Mitchell’s time dockets in which she identified $142,217 in billings allegedly arising from unrelated matters or motions for which costs had already been decided.

Deducting those amounts reduces the estimated fees to $282,783. Although Mr. Mitchell disputed the alleged irrelevance of several entries, he accepted that most of the items identified by Ms. Barteaux should not be considered by the court. [ 60 ] The parties agree that when deciding whether to depart from the tariffs and order a lump sum, counsel’s time records and billings are not determinative. The successful party is entitled to a substantial contribution to their reasonable legal fees, not their actual legal fees. In some cases, the actual legal fees will be reasonable. This is not one of those cases.

Having carefully reviewed the materials, I find that a reasonable amount for the applicant’s legal fees would be in the range of $250,000 to $275,000. I further find that an award under the tariffs would not represent a substantial contribution to those fees. [ 61 ] In my view, this is an appropriate case to award a lump sum.

I recognize that the court has discretion to increase the tariff award to account for formal settlement offers and/or to decrease it to account for delay and inefficiencies, both of which are relevant here, but I find that it is better to “channel that discretion directly to the principled calculation of a lump sum”: Armoyan , at para. 18. [ 62 ] Mr. Mitchell submits that Mr. Matthews made two formal offers to settle for a lesser sum than he was ultimately awarded in damages, and that this fact warrants a substantial increase in the cost amount awarded. Mr.

Mitchell says the first settlement offer was outlined in his letter to Mr. Jamieson, Mr. Emond, and Mr. Brown, dated July 29, 2011. ONC submits that this letter was not a formal offer to settle pursuant to Civil Procedure Rule 10 – it was a demand letter. Ms. Barteaux points out that Mr. Mitchell referred to it as such in his affidavit. She argues that it would be improper to treat the demand letter as a formal offer to settle because the judicial proceeding was not commenced until August 9, 2011. I agree.

Rule 10 refers to settlement “of a proceeding or of a claim in a proceeding”. [ 63 ] ONC concedes, however, that Mr. Matthews did make a formal offer to settle on February 21, 2012, and that if the tariff is applied, the court has discretion under Rule 10.09(2)(

b) to multiply the tariff amount by 75%. ONC submits that there are very few reported decisions where the court has exercised its discretion to apply the multiplier pursuant to Rule 10.09(2). It says the court should decline to increase the applicant’s costs due to his counsel’s conduct during the litigation. ONC cites MacNutt v. Acadia University , 2016 NSSC 208 , where Chipman J. stated: [9] Rule 10.09 deals with determining costs if a Formal Offer is not accepted.

I note the accelerated costs are entirely discretionable and in all of the circumstances I have chosen to decline Acadia’s request to in effect double their costs award. … [ 64 ] Justice Chipman’s reasons for declining to exercise his discretion are explained in the remainder of the paragraph, not quoted by ONC: By exercising my discretion in this way, I am mindful of, among other things, Ms. MacNutt’s status as a self-represented party. I doubt she was aware of the significant costs consequences associated with her failure to respond to Acadia’s Formal Offer.

Further, it is noteworthy that she advanced a Formal Offer to Acadia on March 11, 2014 and then did not receive Acadia’s Formal Offer until almost two years later. [ 65 ] MacNutt confirms that every case must be considered on its own facts. In my view, Mr. Matthews’s settlement offer is an important factor in determining a costs award that will do justice between the parties. While Mr. Mitchell’s conduct of the proceeding is also relevant, the fact remains that ONC’s acceptance of Mr.

Matthews’s reasonable settlement offer in February 2012 would have saved the parties nine years of litigation and hundreds of thousands of dollars in fees. [ 66 ] I will now consider ONC’s submission that Mr. Mitchell’s conduct of the case justifies a reduction in his client’s costs, and even an order that Mr. Mitchell pay certain costs personally to ONC. At the same time, I will deal with Mr. Mitchell’s allegations of “tactical” conduct on ONC’s part to slow the pace of the proceeding. Since Mr.

Mitchell says this tactical conduct began immediately after the filing of the notice of application, I will start there. Early process

[ 67 ] The notice of application was filed on August 9, 2011. At a motion for directions held on August 31, Mr. Mitchell estimated that the application could be heard in three days, and could be ready for hearing in three months . ONC advised Pickup J. that it intended to file three motions – one for

summary judgment on the evidence with respect to the oppression claim, one to convert the application to an action, and one to remove several respondents. Mr. Mitchell suggests these motions were intended to delay the proceeding, but there is no evidence to support that allegation. In my view, the three motions were reasonable in the circumstances. [ 68 ] Mr. Mitchell also says ONC delayed in filing its notice of contest and the notices of motion until he threatened to bring (and did bring) Appearance Day motions. The notice of contest was filed on September 22, 2011.

I do not consider that an inordinate amount of time, for two reasons. First, Ms. Barteaux was busy responding to allegations from Mr. Mitchell that she was in a conflict of interest. Mr. Mitchell’s own time records indicate that he was billing for work on that issue until the motion for directions. Second, Mr. Mitchell had incorrectly named one of the parties and needed to amend his notice of application. [ 69 ] ONC filed its three motions on November 17, 2011.

While the motions could probably have been filed sooner, I do not consider the short delay to be evidence of a larger strategy to delay the proceeding. [ 70 ] On November 18, 2011, Mr. Mitchell filed an Appearance Day Notice seeking to set a date for a motion for directions and to have ONC provide disclosure and particulars of the three motions. The motion was set for December 2. ONC took the position that its notices of motion complied with the Rules and that the scope of disclosure and the need for a motion for directions would depend on the outcome of its three motions.

Justice Duncan dismissed the applicant’s requests and set ONC’s three motions down for hearing on March 1, 2012, the soonest available date. [ 71 ] Justice Wood issued his decision on the motions on April 12, 2012. ONC was successful in having the additional respondents removed but the court did not allow the

summary judgment motion or the motion to convert the matter to an action. ONC filed an appeal of the decision on April 26. [ 72 ] On May 28, 2012, the parties appeared before Justice Wood to deal with the form of the orders and costs on the motions. At that time, the court directed document disclosure on the application in court by both parties by August 31. Although the decision was under appeal, no stay issued. To this point, I find no meaningful delay by either party. Disclosure and discovery [ 73 ] Issues with discoveries and disclosure consumed the next three years. While Mr.

Mitchell submits that ONC was responsible for delay during the disclosure and discovery process, the evidence before the court does not support that allegation. Having reviewed the communications between counsel, I find that Ms. Barteaux often had to prod and push Mr. Mitchell to obtain further disclosure, to clarify what additional production he was seeking from ONC, to identify individuals he wished to discover, and to set dates for their examinations. On multiple occasions, Mr. Mitchell attempted to obtain discovery subpoenas from the prothonotary, rather than from a judge, as is required on an application.

He persisted in this behaviour in the face of repeated reminders and objections from both Ms. Barteaux and the prothonotary. Mr. Mitchell repeatedly ignored communications from Ms. Barteaux and deadlines imposed by the court. The following recital of events, while lengthy, is far from exhaustive. [ 74 ] On August 31, 2013, Ms. Barteaux wrote to Mr. Mitchell advising that ONC’s affidavit of documents contained approximately 400 tabs and that counsel was still dealing with redactions. She requested a one-week extension to the deadline for providing Mr. Mitchell with the documents. Mr.

Mitchell did not respond. [ 75 ] ONC provided its first affidavit disclosing documents containing 411 documents to Mr. Mitchell on September 6, 2012. On the same day, Mr. Mitchell disclosed a book of documents on Mr. Matthews’s behalf. ONC subsequently took the position that Mr. Matthews’s disclosure was incomplete. [ 76 ] On October 1, 2012, the parties appeared before Justice Wright on a motion for directions. Justice Wright set the matter down for a full day on December 19 to allow the parties to bring cross motions on production and certain discovery issues. [ 77 ] On October 29, 2012, Mr.

Mitchell advised by letter that he would provide a first supplementary book of documents. On the same date, he indicated that he wanted to discover Daniel Emond, Robert Orr, and Martin Jamieson. On November 5, Ms. Barteaux advised Mr. Mitchell that it was not necessary to subpoena Mr. Orr because, although he was no longer in the control of ONC, she would arrange for his attendance at discovery. [ 78 ] On November 14, 2012, Ms. Barteaux wrote to Mr. Mitchell seeking the applicant’s first supplemental book of documents and identifying the documents requested. On November 28, Mr. Mitchell sent Ms.

Barteaux a copy of Mr. Matthews’s Skype messages and employment information with TASA for the period of February-June 2011 and said he had yet to prepare the first supplemental book of documents. [ 79 ] On December 12, 2012, Mr. Mitchell advised that he had made a scheduling error and needed to seek an adjournment of the motions scheduled for December 19. The next day, Ms. Barteaux sent Mr. Mitchell a CD containing a supplemental affidavit disclosing documents.

On December 17, she sent further documents and advised that a second supplemental affidavit would be filed in due course. [ 80 ] On December 21, 2012, ONC’s appeal of Justice Wood’s decisions on its motions was dismissed. [ 81 ] Over the next two months, Mr. Mitchell did not contact Ms. Barteaux to reschedule the December 19, 2012 appearance or to set dates for discovery. In an effort to move things along, Ms.

Barteaux wrote to him on February 20, 2013: It is important to Ocean Nutrition Canada Limited that we proceed with any further pre-discovery motions that need to be made, and discovery, within the next couple of months. I have a number of available dates in April if it is necessary to attend before Justice Wood (or another judge) on any production or discovery issues. Please provide me with dates that you are available as soon as possible. … Please also provide me with dates in May that Mr. Matthews will make himself available in Halifax for discovery.

That letter prompted a conference call with Justice Wood and cross motions for production were scheduled for April 30, 2013. [ 82 ] On March 4, 2013, Ms. Barteaux wrote to Mr. Mitchell proposing June 17 to 21, 2013 for the discoveries of Mr. Matthews, Mr. Jamieson, Mr. Wilson, and Mr. Emond. Mr. Mitchell did not respond. She wrote to him again on March 14 about the June dates, and he eventually agreed. On March 15, both counsel wrote to the court to confirm they would be proceeding with the cross motions on April 30, 2013. [ 83 ] On the applicant’s motion for production, Mr.

Mitchell sought only “further and better” production without providing any particulars in regard to the 644 documents that ONC had disclosed. He did not address what was missing or the issues he had with redaction. Instead of filing a brief, Mr. Mitchell filed the affidavits disclosing documents provided by ONC, in their entirety. As Wood J. noted in his costs decision on the motions [2013 NSSC 158]: [4] When Mr. Matthews filed his motion documents on April 11, 2013 he did not include a brief.

The notice of motion was very general and simply sought better production, directions with respect to redaction of documents and directions with respect to the scope of electronic searches to be carried out by the Respondent. In addition, the form of order filed by Mr. Matthews was blank and included no particulars with respect to documents or directions being sought. The affidavit filed on behalf of Mr. Matthews included a letter dated April 11, 2013 from his counsel, Blair Mitchell, to Ms. Nancy Barteaux, who was counsel to the Respondent.

This letter set out various demands for documents to be produced. [ 84 ] To assist the court, Ms. Barteaux prepared a chart summarizing the outstanding production issues. Mr. Mitchell requested an electronic copy of the chart so he could use it to respond, and Ms. Barteaux agreed to provide it. Justice Wood described the outcome of the Matthews motion as follows: [8] Much of the work by counsel and the court with respect to the Matthews’ motion involved reviewing a significant volume of redacted documents. During that process the Respondent agreed to remove a number of redactions voluntarily.

I ordered additional documents to be unredacted. The end result was that approximately one-quarter of the redactions challenged by Mr. Matthews were set aside by agreement or court order. [9] With respect to the remaining disclosure sought by Mr. Matthews, I was not satisfied that there was an evidentiary basis to order production.

In many cases I suggested that the issue should be pursued through the discovery examination process to determine what evidence might be obtained with respect to the existence and relevance of the documents in questions. [ 85 ] Justice Wood went on to award costs to ONC on the motion: [15] I am satisfied that success on the merits was divided and that in normal circumstances I would have fixed costs of the motion in the amount of $1000 for a half-day hearing payable in the cause. However, I think there is merit to Ms.

Barteaux’s position that the Respondent was put to unnecessary additional expense trying to anticipate the matters in issue and this arose specifically from the failure of Mr. Matthews to file a brief and draft form of order as required by Civil Procedure Rule 23.11 as part of the initial motion documents. As a result, I will award costs of $750 on this motion in favour of Ocean Nutrition in any event of the cause. Since the additional expenses incurred by Ocean Nutrition responding to this motion were unnecessary I believe payment of these costs should not wait until conclusion of this litigation.

As a result, I will order that they be paid on or before June 30, 2013. [Emphasis added] [ 86 ] As to ONC’s motion, it was seeking various documents that Mr. Matthews said did not exist or were not in his possession. ONC also sought a direction requiring Mr. Matthews to produce an affidavit disclosing documents pursuant to Civil Procedure Rule 15. Mr. Matthews had previously provided books of documents without an affidavit. Justice Wood found that the motion documents were the first indication from Ms. Barteaux that ONC was seeking an affidavit disclosing documents from Mr. Matthews. In any event, Mr.

Mitchell consented on his client’s behalf to the direction requiring an affidavit during the hearing. Ms. Barteaux then requested deferral of much of the production requests until after she had obtained and reviewed the affidavit disclosing documents. To the extent that there were any remaining production requests by ONC, Wood J. dismissed them as having no evidentiary basis. As with Mr. Matthews’s motion, Wood J. suggested that many of these issues should be pursued through the discovery examination process. Mr.

Matthews was awarded costs of $750, to be paid at the conclusion of the proceeding. [ 87 ] On May 13, 2013, Mr. Mitchell wrote to Ms. Barteaux to say that he had the week of July 15, 2013 reserved for additional discovery. Ms. Barteaux replied with a lengthy letter summarizing the history of communications between the parties and with the court to demonstrate that the week of July 15 had never been discussed. She also asked who Mr. Mitchell wanted to discover other than Daniel Emond, Martin Jamieson, and Craig Wilson. Mr. Mitchell refused to say. Ms. Barteaux reminded Mr.

Mitchell that in an application, he either needed agreement or a discovery subpoena if he wished to discover someone else. [ 88 ] On May 22, 2013, Mr. Mitchell wrote that he wanted to discover Robert Orr on July 15. The next day, he wrote to the prothonotary for a discovery subpoena for Mr. Orr. Ms. Barteaux wrote to the prothonotary on the same day outlining the history of the discovery discussions. On May 24, Ms. Barteaux wrote to Mr. Mitchell to confirm that she had spoken to Mr. Orr and determined that he was available for July 15 and 16, if necessary. On the same date, the prothonotary wrote to Mr.

Mitchell advising that she could not issue the subpoena because subpoenas in an application require permission of a judge. After numerous communications back and forth between counsel, the discovery subpoena issue (and several others) ended up before Wright J. in chambers. Justice Wright granted the subpoena for the dates already arranged between Mr. Orr and Ms. Barteaux. [ 89 ] On May 29, 2013, Mr. Mitchell made a motion to have Martin Jamieson removed as ONC’s designated litigation manager. The court followed up with counsel on two occasions to set a date, but received no response. Mr.

Mitchell did not pursue the motion. [ 90 ] Discoveries of Mr. Matthews, Martin Jamieson, and Craig Wilson took place June 17-20, 2013. Discovery of Robert Orr began on July 15, but could not be completed because Mr. Mitchell advised that he needed to attend in chambers the next morning.

[ 91 ] On July 18, 2013, Ms. Barteaux provided Mr. Mitchell with ONC’s third supplemental affidavit of documents. [ 92 ] On July 22, 2013, Mr. Mitchell wrote to Ms. Barteaux asking about the possibility of discoveries of Mr. Orr, Mr. Emond, and Mr. Perez during the week of September 23. Ms. Barteaux responded that she was not available during that week. She asked Mr. Mitchell to provide dates in October, November, and December when Mr. Matthews was available and she would canvas the dates with Mr. Orr, Mr. Emond, Mr. Perez, and Mr. Jamieson. Mr. Mitchell did not respond. [ 93 ] On July 30, 2013, Ms.

Barteaux sent revised orders arising out of the April 30, 2013 appearance for his review and signature. Mr. Mitchell did not respond. She sent another letter on August 19, 2013. Again, he did not respond. [ 94 ] Having received no response about discovery dates, Ms. Barteaux’s associate emailed Mr. Mitchell on August 21, 2013, confirming that counsel and the deponents were available to continue discoveries during the week of January 6-10, 2014. Counsel asked Mr. Mitchell to identify who he intended to discover that week, and confirmed that Ms. Barteaux needed to discover Mr. Orr. The next day, Mr.

Mitchell’s assistant confirmed that he and Mr. Matthews would be available for the January dates. [ 95 ] On September 5, 2013, Ms. Barteaux wrote to Mr. Mitchell for a third time in relation to the April 30, 2013 court appearance. She advised that she and her client continued to await receipt of the signed revised order. She also advised that they continued to await receipt of Mr. Matthews’ affidavit of documents, or, alternatively, an indication as to when they could expect it. On September 16, she wrote a fourth time. Finally, on September 24, 2013, Ms.

Barteaux wrote to advise that if she did not receive the revised orders signed by Mr. Mitchell, she would be sending them to Justice Wood along with copies of the letters to Mr. Mitchell, and asking the court to issue the revised orders in their present form. On October 1, 2013, Mr. Mitchell called Ms. Barteaux’s associate to confirm that the revised orders they wanted issued were those enclosed with the July 30 correspondence. The associate confirmed that that was the case and Mr. Mitchell said he would get back to them shortly. The orders were issued on October 7, 2013. [ 96 ] On November 12, 2013, Ms.

Barteaux followed up with Mr. Mitchell by email regarding whom he wished to discover in January 2014 and where the discoveries would take place. On November 25, she followed up by letter, seeking the same information. She wrote again on December 6. [ 97 ] On December 12, 2013, Ms. Barteaux wrote to Mr. Mitchell in response to ONC’s undertakings to the June and July 2013 discoveries. She also asked him to respond regarding the undertakings of Mr. Matthews and the status of the affidavit of documents. On the same day, she sent him ONC’s fourth supplemental affidavit of documents. [ 98 ] On December 20, 2013, Mr.

Mitchell spoke with Ms. Barteaux’s associate by telephone, indicating that there was a witness he wanted to discover on January 3, 2014, and asking whether all those who needed to be in attendance on behalf of ONC were available on that day. Mr. Mitchell would not disclose the identity of the witness. Ms. Barteaux wrote to Mr. Mitchell on the same day, stating in part: It is our position that your late request for a discovery on January 3, 2014 is entirely unreasonable in light of the circumstances.

Specifically, on August 21, 2013, we confirmed with you our availability to resume discoveries in this matter from January 6-10, 2014. Since then, we have written to you on August 22, 2013, November 13, 2013, November 25, 2013, and December 6, 2013 to ask you to advise us who you wished to discover during that week. We have not received a reply to any of those letters nor have you otherwise indicated who you wished to discover prior to today’s telephone call, which was initiated by Isabelle French. Ms. Barteaux concluded by advising Mr.

Mitchell that he would need to obtain a discovery subpoena for anyone he wished to discover. [ 99 ] Discoveries of Mr. Orr and Mr. Emond were completed on January 6-9, 2014. [ 100 ] On May 9, 2014, Mr. Mitchell sought discovery subpoenas for Phil MacLennan, Morgan Dunbar, Stan Spavold, and David Brown. He had not sought subpoenas or documents from those individuals prior to that date. Mr. Mitchell again attempted to obtain these subpoenas from the prothonotary. The prothonotary again directed him to file a motion. Mr.

Mitchell subsequently filed a motion for subpoenas which included an additional witness, bringing the total to five. On May 27, Ms. Barteaux wrote to the prothonotary to ask that the motion for subpoenas be heard at the same time as the motion for date and directions. [ 101 ] On June 16, 2014, ONC responded to the undertaking request from the January 2014 discoveries. By that time, ONC had filed its fifth supplemental affidavit of documents and had not received responses to the undertakings obtained from Mr. Matthews during his June 2013 discovery. [ 102 ] On June 17, 2014, a hearing was held before Justice Moir.

In a letter, he confirmed agreements reached by the parties before him and directed that Mr. Matthews file a sworn affidavit of documents by July 15, 2014. Justice Moir stated the deadlines were “mandatory”. Mr. Mitchell failed to meet the deadline, filing an unsworn affidavit of documents on August 22, 2014. He advised the court that he intended to file a sworn one “shortly”. Mr. Mitchell provided Ms. Barteaux with a sworn copy on August 25, 2014, but did not file it with the court because the notary in Peru where Mr.

Matthews resided had failed to sign the exhibits. [ 103 ] On January 26, 2015, the parties again appeared before Justice Moir. He had strong words for Mr. Mitchell: THE COURT: Well, what do you think, Mr. Mitchell? I mean, you started this thing years ago and we don’t even have hearing dates yet. And I set you a bunch of deadlines that were said in my letter to be mandatory because of the situation. MR. MITCHELL: Yes, My Lord. THE COURT: And you just ignored them all. MR. MITCHELL: My Lord, yes. Yes, that’s – there’s no point in looking to gainsay that proposition, My Lord.

The status of – THE COURT: So the sensible thing is to dismiss the proceeding. If I’ve got a party who won’t comply with directions from the Court

in a process that’s supposed to be heavily under judicial management, there’s only one answer that I can give you and that’s you’re abusing the process and I’m going to dismiss. [Emphasis added] [ 104 ] At one point, Justice Moir noted: THE COURT: The problem is I’m managing something that pretends to be an application when it is in fact an action. That’s the problem. [ 105 ] On January 30, 2015, Moir J. sent a letter to the parties confirming his directions. He refused to approve discovery subpoenas for Mr. Brown, Mr. MacLellan, Mr. Thomson, and Mr. Perez. He approved discovery subpoenas for Ms. Dunbar, Mr.

Spavold, and Megan Harris, and set deadlines for their examinations. Justice Moir directed that any motion by the applicant for production of any allegedly undisclosed documents or production of documents in an unredacted form must be made by February 28, 2015. He also directed the applicant to file his pre-hearing brief by September 30, 2015. The hearing was set for 6 days – November 2-5, 9, and 10, 2015. [ 106 ] Megan Harris and Stan Spavold were discovered on May 7, 2015. Mr. Mitchell did not discover Morgan Dunbar. The hearing [ 107 ] The deadline for Mr.

Matthews’ brief set by Justice Moir was September 30, 2015. On October 8, Ms. Barteaux wrote to Justice Leblanc, the hearing judge, to advise that she had not received the applicant’s brief. On October 8, 2015, Mr. Mitchell responded that he had “diary errors” and could file his brief by October 14. [ 108 ] On October 9, 2015, Ms. Barteaux and Mr. Mitchell had an email exchange wherein she told him that she had not advised any of ONC’s affiants that they would be required for the hearing, and that for others it would be necessary to obtain a subpoena.

She confirmed that most were out of province – and in the case of Mr. Spavold, out of the country – and that she needed to hear from him that day. Mr. Mitchell responded that he was out of the office but wanted her to produce Mr. Jamieson, Mr. Emond, Mr. Wilson, and Mr. Spavold. He also confirmed that he would subpoena Mr. Orr. [ 109 ] On October 15, 2015, Ms. Barteaux wrote to Mr. Mitchell regarding his still unfiled brief and the order of witnesses for the hearing. She confirmed the attendance of Mr. Wilson and Mr. Spavold, and put Mr.

Mitchell on notice that if he did not subsequently require either of them, his client would be responsible for the cost of having them attend. [ 110 ] On October 20, 2015, Mr. Mitchell filed the applicant’s brief and authorities. ONC filed its submissions and authorities seven days later. [ 111 ] During the first day of the hearing on November 2, 2015, Justice Leblanc raised concerns about hearsay in the affidavit of Martin Jamieson, filed by ONC. Mr. Jamieson’s affidavit consisted of 358 paragraphs, with five large volumes of exhibits. [ 112 ] On Friday, November 6, 2015, Mr.

Mitchell wrote to Justice Leblanc, transmitted by fax, raising several issues. Although the letter was copied to Ms. Barteaux, she did not receive it due to issues with her office’s fax machine. Mr. Mitchell opened the letter by confirming that: (1) the applicant no longer wished to call Meghan Harris, and (2) the applicant had asked Ms. Barteaux on November 2 to produce Stan Spavold and Craig Wilson as the first witnesses for ONC. Mr. Mitchell went on to advise of his client’s intention to move for an order striking significant portions of Mr. Jamieson’s affidavit on hearsay grounds. Mr.

Mitchell also proposed to call Paul Empey (a former ONC employee) “in rebuttal” on the afternoon of November 9, 2015. [ 113 ] Mr. Mitchell had previously obtained a subpoena for Mr. Empey but had not filed an affidavit from him or indicated that he would be calling him as a witness. Cross-examination of the applicant’s first two witnesses took longer than anticipated and Daniel Emond, a witness for ONC, had travel plans that might have interfered with his availability to testify. Accommodations were made to allow Mr. Emond to take the stand out of order, testifying between witnesses for the applicant. Mr.

Mitchell then sought to call Paul Empey to rebut Mr. Emond’s evidence before ONC opened its case. [ 114 ] On Sunday, November 8, 2015, Ms. Barteaux received a brief email from Mr. Mitchell at approximately 4:00 pm to advise that Craig Wilson would not be required. She received another email at 8:10 pm advising that Stan Spavold would also not be required. According to Ms. Barteaux, she had prepared Mr. Wilson and Mr. Spavold for 6.5 hours on November 6, 2015, and had completed further preparation for Mr.

Spavold on November 8. [ 115 ] On November 9, 2015, Justice Leblanc heard from the parties on the Paul Empey issue. After considering the authorities cited by Ms. Barteaux, Mr. Mitchell conceded that Mr. Empey’s evidence was not proper reply evidence. He therefore asked the court to exercise its discretion to allow Mr. Empey to be called as part of the applicant’s case-in-chief. Justice Leblanc adjourned for a period of time before deciding that Mr. Empey’s evidence could go in, so long as Ms. Barteaux had the opportunity to speak to Mr.

Empey beforehand. [ 116 ] With respect to the motion to strike portions of the Jamieson affidavit, Justice Leblanc was prepared to adjourn the application to allow Ms. Barteaux to properly respond to the extensive challenge to the affidavit’s contents, but that proved unnecessary. Ms. Barteaux was given the opportunity to amend Jamieson’s affidavit, and that of Craig Wilson, and to obtain additional affidavits from any other potential witnesses. At some point thereafter, Mr. Mitchell decided to cross-examine Mr.

Wilson after all. [ 117 ] Another issue that arose during the hearing related to disclosure of the amount DSM offered to purchase ONC in March/April 2011. Mr. Mitchell had asked both Mr. Jamieson and Mr. Orr for this figure during discoveries and ONC objected on both occasions. Mr. Mitchell asked the question again at the hearing, first from Mr. Orr. Mr. Orr then sought personal legal advice to determine his obligations under a non-disclosure agreement he had signed at the time of the negotiation between DSM and ONC in 2011. Justice Leblanc did not require Mr. Orr to answer the question. Mr.

Mitchell then sought the answer through Martin Jamieson. After argument by ONC objecting to Mr. Jamieson answering the question, Justice Leblanc directed the parties to make written submissions following

the conclusion of Mr. Jamieson’s evidence on November 13, 2015, and he would decide the issue prior to the date scheduled for Mr. Wilson to be cross-examined (November 27). Mr. Jamieson was to be recalled to answer the question if the decision was that he was required to do so. [ 118 ] Mr. Mitchell subsequently sought adjournment of the November 27, 2015 motion. ONC objected to the adjournment but it was granted. The conclusion of the hearing was delayed to January 28, 2016.

ONC pursued recovery of its witnesses’ travel costs and some were granted. [ 119 ] Eventually, Justice Leblanc refused to order disclosure of the purchase price. He held that Mr. Mitchell should have filed a motion prior to February 28, 2015 – the deadline set by Justice Moir for any further motions for production. Post-hearing submissions [ 120 ] On January 28, 2016, the final day of the hearing, Justice Leblanc set deadlines for the parties’ respective post-hearing written submissions. The applicant’s submissions were due on March 7, 2016. On March 7, Mr.

Mitchell wrote to the court advising that he could not meet the deadline. Justice Leblanc granted an extension, which then extended ONC’s date for reply to April 15, 2016. Mr. Mitchell then sought an extension for reply. [ 121 ] On October 12, 2016, Justice Leblanc wrote to the parties seeking submissions on two recently released Ontario Court of Appeal decisions and another issue. Justice Leblanc directed that submissions were due by November 10. On November 9, Ms. Barteaux wrote to Mr. Mitchell to inquire whether he would be filing his submission the next day as directed. Mr.

Mitchell then wrote to the court to state that he had been reminded of the date for filing and that he “expected” he would meet the deadline, but if he did not, he would not expect Ms. Barteaux to file. Mr. Mitchell did not file his submissions until November 15, 2016. Post-decision submissions [ 122 ] In his decision issued January 30, 2017, Justice Leblanc directed the parties to file submissions on costs within 45 days of the decision if they could not reach agreement. [ 123 ] On February 28, 2017, Mr. Mitchell provided Ms. Barteaux with a proposed form of order. On March 6, Ms.

Barteaux responded, pointing out that Mr. Mitchell had been required under the Rules to provide the draft order by February 13. She went on to object to the form of the order. She also provided him with a draft form of order. [ 124 ] On March 2, 2017, Ms. Barteaux wrote to Mr. Mitchell asking for his position on costs as soon as possible so the parties could determine whether written submissions would be necessary while there was still ample time to prepare them before the March 22 deadline. Ms. Barteaux also had plans to be out of the country for most of April. Mr.

Mitchell did not respond. [ 125 ] On March 10, 2017, Mr. Mitchell wrote to Justice Leblanc advising that the parties had not come to a consensus with respect to the quantification of loss. He went on to state: Costs also remain unresolved. As there remain disputes on quantification, the Applicant would submit that they might best be addressed when those other matters are resolved. [ 126 ] Ms. Barteaux wrote to Justice Leblanc on March 13, 2017. She noted that there had been no discussions between the parties with respect to costs. She confirmed that she had written to Mr. Mitchell on March 2 a

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