2017 ONSC 3627, 2017 ONSC 3627

CITATION : Elbassiouni v.World Fine Cars, 2017 ONSC 3627 COURT FILE NO.: 548/16 DATE: 20170612 ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT B E T W E E N: ) ) ESSAM ELBASSIOUNI ) Mireille Dahab , for the Appellant ) Plaintiff/Appellant by Cross-Appeal ) ) - and - ) ) WORLD FINE CARS LIMITED ) Gaetana Campisi , for the Respondent ) Defendant/Respondent by Cross-Appeal ) ) Heard at Toronto: May 17, 2017 DECISION D.L. Corbett J.: [ 1 ] This case concerns a dispute over a used car. Mr Elbassiouni purchased the car from World Fine Cars Limited (“WFC”).

Mr Elbassiouni drove the car for several months, but had increasing problems with it. He took it back to WFC. He did not receive satisfaction. Litigation ensued culminating in a trial in the small claims court. [ 2 ] The trial judge found WFC liable for costs of repair to the car, which he fixed at $11,135, plus $471.21 paid to another car dealer to evaluate the repair costs required to fix the car.

The trial judge did not award any consequential damages to Elbassiouni (such as the cost of a rental vehicle or the diminution in value of the vehicle while it sat in storage) although the trial judge did award Elbassiouni prejudgment interest on the repair costs going back to November 26, 2013, even though the repair costs have never been incurred. [ 3 ] WFC appealed the finding of liability. Elbassiouni cross-appealed the trial judge’s determination of damages. Subsequently, WFC abandoned its main appeal. Elbassiouni elected to continue with his cross-appeal, which was heard before this court.

Issues on Appeal [ 4 ] Mr Elbassiouni raises [three] issues on appeal:

(1) He argues that the trial judge erred in failing to award him his cost to rent an alternate vehicle. He argues that this cost was a direct and foreseeable consequence of the defect in the car he bought from WFC and WFC’s failure to fix the car or to take it back for a full refund.

(2) He argues that the trial judge erred in failing to award him the full value of the car (that is, a refund). He says that the trial judge found that the car was not of merchantable quality when WFC sold it to him, and that on this basis he should have been awarded a full refund.

(3) He argues that the trial judge erred in awarding him so little in costs. He says that he required an expert for the trial and that three days of trial time was required based on the nature of WFC’s failed defence on liability.

Summary and Disposition [ 5 ] I would not give effect to any of the grounds of appeal. [ 6 ] The trial judge found that, while WFC was liable to Elbassiouni for the defects in the car, Elbassiouni acted unreasonably in failing to have the car repaired or in otherwise mitigating his losses. I appreciate that Elbassiouni does not agree with this finding, but it is based on facts available to the trial judge and on a reasonable application by the trial judge of the doctrines of remoteness and foreseeability.

[7] I appreciate that the trial judge did use language that could ground a remedy of rescission, but that is not the remedy heordered. Implicit in the trial judge’s factual findings is a conclusion that Elbassiouni did receive some value out of the transaction (use ofa vehicle for several months, and the net value of the vehicle after the costs of repairs). Further, the case was argued on the basis, notthat the plaintiff was seeking rescission, but that he wanted damages to put him in the position he would have been in if the contract hadbeen performed.

It is no error for the trial judge to decide the case on the basis on which it was argued before him. [8] On the issue of costs, the trial judge awarded the maximum amount available under the ordinary small claims court tariffs. The trial judge had a discretion to award more than the standard tariff, put his mind to the question of whether he should do so, anddecided that he should not exercise his discretion in favour of an increased award of costs. In so concluding, the trial judge made noerror in principle. His decision on costs is entitled to deference.

Issue #1: The Costs of a Rental Vehicle [9] Elbassiouni argues that there is a clear line of cases that recognize that costs of a rental car for the period during which a caris being repaired is part of a recoverable loss. I agree with this point. However, in this case Elbassiouni rented a car for 33.5 monthswhile his car sat idly in a storage garage, unrepaired. This situation does not fit within the principle of the cases cited by Elbassiouni: herented a car for the duration of his dispute with WFC not for the reasonable time required to repair his car.

And this was the conclusionof the trial judge: he found that Elbassiouni’s claim for $21,751.89 for the costs of renting a car for 34 months was not foreseeable. I seeno error in this conclusion. [10] Elbassiouni argued that he lacked the financial ability to repair his car or to purchase an alternate vehicle, and that these factswere known to WFC (because Elbassiouni had disclosed his financial position in his application for credit to buy the car from WFC). Clearly the trial judge did not find this information compelling.

Even if it was all true, that would not make it reasonable to imposeliability on WFC for this remote consequence of the dispute. [11] Elbassiouni argued in the alternative that, at minimum, the trial judge should have awarded the cost to rent a car for theperiod reasonably required to repair the car. The trial judge found that that the monthly rental cost was $649.31. [12] This is an appeal, not a rehearing. The trial judge was not asked to award one month’s rental costs in the alternative to 33.5months’ rental costs.

No evidence was led on how long it should reasonably have taken to repair the car, and so the trial judge made nofinding on this point. The trial judge decided the case on the basis of the evidence and arguments presented to him, and I am notprepared to interfere with his decision on appeal on the basis of an alternative argument raised for the first time on appeal. [13] I would not give effect to the first ground of appeal. Issue #2: Fundamental Breach [14] The trial judge made a finding which could have been the foundation for a finding of fundamental breach and an award ofdamages based upon rescission.

He found that the car was not of merchantable quality at the time it was sold to Elbassiouni. The trialjudge was not, however, required to grant rescissionary damages, and he decided not to do so. His reasons for so choosing are apparenton the face of his decision:

(1) The trial judge accepted that Elabssiouni received some value by having had the use of the vehicle for several months,during which time he drove the car about 5,352 kms.;

(2) The trial judge decided the case on the basis of the case that was argued before him. Rescission was not a remedy sought byElbassiouni and the trial judge was not obliged to consider or award a remedy that was not sought from him at trial. [15] Again, an appeal is not a chance to reargue the case on a new basis. I would not give effect to this ground of appeal. Issue #3: Costs [16] Small claims court is intended to be fast and inexpensive. It is intended to be a court where ordinary members of thecommunity may, without a lawyer, seek justice before a court guided by principles of law and fairness.

Costs awards in the small claimscourt are, like all costs awards, governed by the general principle stated by the Court of Appeal in Boucher v. Public AccountantsCouncil for the Province of Ontario (2004), (ON CA), 71 OR (3d) 291: … [i]n deciding what is fair and reasonable… the expectation of the parties concerning the quantum of costs award is a relevantfactor…. The notions of fairness and reasonableness are embedded in the common law.

Judges have been applying these notions forcenturies to the factual matrix of particular cases. (para. 38) [17] In addition, costs awards in small claims court are governed by s.29 of the Courts of Justice Act, which provides: An award of costs in the Small Claims Court, other than disbursements, shall not exceed 15 per cent of the amount claimed… unless thecourt considers it necessary in the interests of justice to penalize a party… for unreasonable behavior in a proceeding. [18] The trial judge concluded that there was no basis on which to penalize the defendant and limited the plaintiff’s costs to 15% ofthe claim.

In so ordering, the trial judge did not reduce costs to 15% of the amount recovered by the plaintiff, an exercise in discretion inthe plaintiff’s favour. The trial judge’s decision respecting disbursements was discretionary and reveals no error in principle. There isno basis for this court to interfere with the trial judge’s exercise of discretion as to costs. Disposition and Costs [19] The cross-appeal is dismissed. World Fine Cars is entitled to costs of the appeal from Elbassiouni; if the parties cannot agree

on the quantum of costs then World Fine Cars shall deliver its submissions by June 26, 2017 and Elbassiouni shall deliver his costs submissions by July 11, 2017. D.L. Corbett J. Released: June 12, 2017 CITATION : Elbassiouni v.World Fine Cars Ltd., 2017 ONSC 3627 COURT FILE NO.: 548/16 DATE: 20170612 ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT BETWEEN: ESSAM ELBASSIOUNI Plaintiff/Appellant - and - WORLD FINE CARS LIMITED Defendant/Respondent DECISION D.L. Corbett J. Released: June 12, 2017