2013 ONSC 7913, 2013 ONSC 7913

CITATION : André Lamoureux et al. V. Chicken Farmers of Ontario, et al. , 2013 ONSC 7913 COURT FILE NO.: 579-2012 DATE: 2013-12-20 SUPERIOR COURT OF JUSTICE - ONTARIO RE: André Lamoureux et al. Applicants AND Chicken Farmers of Ontario et al. Respondents BEFORE: The Honourable Justice Michel Z. Charbonneau COUNSEL: Ronald F. Caza for the applicants Herman Turkstra for the respondent Ontario Chicken Processors Geoffrey P.

Spurr for the respondent Chicken Farmers of Ontario HEARD: Written Submissions ENDORSEMENT ON COSTS [ 1 ] I have now had the opportunity of reviewing the lengthy written submissions of the applicants and the two respondents. There is no issue as to the applicants’ entitlement to costs. The only issue is the quantum of the award. In their written submissions the parties ask the court to decide a number of questions. I answer those questions as follows:

a) What is the scale to be used to quantify the costs ? [ 2 ] The applicants submit this is a case where the exceptional scale of substantial indemnity should be used. They put forward two grounds in support of their position. First, they argue the costs here are in the nature of costs thrown away which usually attracts the substantial indemnity scale and even in some cases full indemnity scale. [ 3 ] I disagree. The proceeding ended when the respondents agreed to change the disputed regulation and replace it with one that would satisfy the applicants’ position.

The respondents made that decision for a number of reasons including the realization that the applicants might very well be successful on the language issue and that an early resolution was more important when looking at the big picture. The fundamental issues raised by the application were not resolved. It is impossible to speculate now as to how the court would have decided them. The situation is therefore similar to any case where a respondent chooses to settle the proceeding by, for example, paying the claim.

This is very different from the cost thrown away situations where, through some conduct of the respondent, the applicant is saddled with costs incurred for nothing. Here the applicants put forward some allegations which the respondents were entitled to defend. The fact that the respondents chose to abandon the fight mid-way through the proceeding does not result in the time and effort of the applicants having been deployed for nothing.

To the contrary, the applicants’ efforts succeeded and the respondents must provide the usual partial indemnification as in any other case. [ 4 ] Secondly, the applicants submit that the respondents were guilty of abusive conduct which should attract a substantial indemnity award. I am not going to review all the allegations and counter-allegations made by the parties on this issue. I can only say that after reviewing everything that was written on the subject by both sides, I conclude that the respondents did not act unreasonably in all the circumstances.

b) Should the time spent on negotiations be excluded when computing costs? [ 5 ] The respondents submit that this was agreed by the parties by virtue of a confidentiality agreement dated August 28 th 2012 which contained the following provision in relation to negotiations: “without prejudice, will be treated by us and our clients as

private and confidential, and will not be disclosed or referred to by us or our client in any litigation , media release or conversations with third parties.” [ 6 ] The reference to litigation “with third parties” is sufficient to answer the respondents’ claim. It would take much clearer language to prevent a successful party from recovering costs for the time spent by his counsel in negotiations. I see nothing else in the submissions of the respondents which would justify such an exclusion.

c) Should all fees and disbursements relating to the evidence of Dr. Castonguay be eliminated from the applicants’ Bill of Costs? [ 7 ] The respondents submit Dr. Castonguay is neither a qualified nor an independent expert and therefore any fees directly or indirectly linked to his evidence must be severed from the applicants’ costs. [ 8 ] I disagree. I must admit, the respondent raises some interesting allegations as to this expert’s qualifications. However, these are only allegations. I am not in a position to decide that issue now on the basis of the material provided to me.

I am certainly not going to order a reference on that point now that the respondents have chosen to throw in the towel.

d) Are the hours spent by the various lawyers for the applicants clearly excessive in all the circumstances? [ 9 ] I agree with the applicants that it would be unreasonable for the Court to make such a finding when the respondents failed to provide their own dockets. [ 10 ] The respondents have also failed to convince me that the applicants’ counsel could simply apply to this file their work already spent in other similar files. I have no reason to reject the applicants counsel’s explanation on this issue.

The respondents’ allegations are really only speculation. [ 11 ] Similarly, I reject the respondents’ submissions that the Bill of Costs contains duplication with other motions. I accept the applicants’ reply on those issues.

e) What is a fair and reasonable amount of costs that should be paid by the respondents? [ 12 ] This is the ultimate question I must answer. In answering this question, I must consider the actual time spent by counsel taking into account their experience and expertise. But this is only one factor. I must also consider all the factors set out in Rule 57.01(1). [ 13 ] I am of the view that this was a case of more than average complexity. The result of the litigation was far from foreseeable. It therefore required extensive preparation time. The issues were important to both sides.

Intervenors were allowed to participate. This was necessary by the complexity relating to the overall objective of the impugned regulation. The intervenors’ participation was welcome by the respondents in view of the four party agreement which was the basis of the regulation. [ 14 ] On the other hand, I am of the view that, even with the above factors in mind, the amount claimed by the applicants is beyond what is a fair and reasonable award of costs on a partial indemnity basis. It remains that this was an application which would have ultimately involved a hearing of 7 to 8 days.

Additionally there were a number of days of cross-examination. The bulk of the time was spent on various aspects of preparation including retaining the various experts. I find that the amount claimed by the applicants in all the circumstances is excessive.

Although they were entitled to spend a substantial amount of time in preparation, it cannot be said that the respondents could have reasonably expected to have to pay the amount claimed. [ 15 ] For all the above reasons, I find the costs payable by the respondents at $170,000.00 inclusive of taxes for fees plus disbursements of $32,221.02 for a grand total of $202,466.70.

_____________________ Charbonneau, J. Date: December 20, 2013 CITATION : André Lamoureux et al. V. Chicken Farmers of Ontario, et al. , 2013 ONSC 7913 ONTARIO SUPERIOR COURT OF JUSTICE RE: André Lamoureux et al. Applicants AND Chicken Farmers of Ontario et al. Respondents BEFORE: The Honourable Justice Michel Z. Charbonneau COUNSEL: Ronald F. Caza for the applicants, Herman Turkstra for the respondent Ontario Chicken Processors, Geoffrey P. Spurr for the respondent Chicken Farmers of Ontario ENDORSEMENT Charbonneau M.Z., Judge Released: December 20, 2013