Superior Court of Justice
(Ontario)
ENDORSEMENTS
Cardinal Meats v. Scott Zies, et al.
File No. CV-13-5380-00
March 18, 1914
Ricchetti, J.
Chambers
Cost Submissions were made in writing.
The Plaintiff seeks substantial indemnity costs in the amount of $188,694.90 plus HST.
The Defendant submits that costs be served to the trial judge.
The Plaintiff sought leave to file reply cost submissions as the Defendants delivered unredacted
general ledger statements to the Plaintiff on the same day that they delivered their responding
costs materials. In my view, the reply submissions ought NOT to be reserved. I ordered
production of the general ledger on the basis the entries were relevant. The Plaintiff wants to
use the general ledgers to show the Defendants lied on the motion materials they filed. I will not
engaged in an investigation to determine whether the defendants lied or not. The costs for the
motion should be dealt with on the materials that were before me on the motion when heard.
There is no applicable Rules Offer. I have reviewed the correspondence in the Plaintiff’s
submissions. The correspondence revolves largely about an overall resolution of the dispute – a
matter to be determined by the trial judge. It is safe to say there was no resolution of the action
on the motion requiring it to be argued.
The Plaintiff submits substantial indemnity costs should be awarded because:
1.
the Defendant’s attempt to have the motion dealt with on Dec 12 2013 on
misleading materials;
2.
the Defendants’ failure to produce critical documents such as the general ledger,
the existence of the 596844 company, the family trust and so on. The Plaintiff
states there deliberate actions complicated the motion unnecessarily and added
tremendous expense to the Plaintiff’s costs.
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the Defendants many misrepresentations such as the denial of Mrs. Zies’
involvement in the companion/trust requiring the Plaintiffs to expend considerable
time and effort to deal with these misrepresentations.
4.
the late delivery of documents and answers to u/ts.
The Defendants submit that there has been no final determination of the rights of the parties.
The Defendants also point to the aborted attendance on Dec 12 2013 and blame the Plaintiff for
this. The Defendants submit that they have been cooperative throughout this matter (a
submission I do not accept).
1.
Should this court fix Costs?
Rule 57.03(1) required the Court to fix costs unless some other order is more just.
I am not persuaded that the preferable (or “just”) order is to reserve the matter to the trial judge.
The facts in this case were overwhelming that some fraudulent activity had been perpetrated,
yet, the Defendants resisted the motion and, in the end, they made less than complete
disclosure and unduly and unnecessarily delayed the disposition of the motion. Essentially, I
agree with the Plaintiff’s submission on the motion that the Defendant’s position was “Cat me if
you can”. Having forced the Plaintiff to jump through numerous hoops to get the order, it would
be “unjust” not to grant the Plaintiff’s costs. Besides, it is clear that there are boxes of materials
filed and it would be difficult, if not impossible, for a trial judge to appreciate all the issues
surrounding the motion or be in as good a position to properly and reasonably assess the costs
of this motion.
Should Substantial Indemnity Costs be awarded?
Substantial indemnity costs should awarded only in rare and exceptional cases where the court
disapproves of the conduct of the party because it is reprehensible, scandalous or outrageous.
Davia v. Mun. of Clarington 2009 ONCA 722.
In this case, the action of the Defendants deserve to be sanctioned.
1.
Trying to pursue the hearing of the motion when the evidence was wrong was
inappropriate
2.
the Defendants have deliberately made the collection of the materials for this
motion extremely difficult and expensive.
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production of relevant documentation was either late or not forthcoming. (such as
the general ledger or tax returns).
The Defendants have done everything in their power to make the Plaintiff’s motion as difficult to
pursue as possible. As set out in my reasons much of the Defendant’s evidence is not credible,
reliable and is misleading.
I am satisfied this is one of those rear and exceptional cases where substantial indemnity costs
should be awarded because the Defendant’s actions leading up to and in response to the
motion deserves to be sanctioned.
What should the quantum of costs be?
The issue is what is just and reasonable in the circumstances of this case. One factor to be
considered is the expectation of the parties.
There were two attendance. There were a number of examinations and cross-examinations
which had to take place, there were extensive undertakings and volumes of materials to be
reviewed. There was extensive affidavit materials before this Court. Extensive factums on
complex factual and legal issues were required. Clearly anyone’s expectation was that this was
an expensive motion to bring and defend.
The Defendants submit that reductions should be made for the following:
1.
the documentary production would have had to be made in the action anyway;
2.
the Defendants should pay for the Rule 39 examination of the Jarvis Defendants;
3.
the junior fee on the motion should be denied;
In my view, the documentary production, primarily from the Defendants, was critical to the
motion. These costs properly form part of the motion’s costs. While the costs to prepare an Aff.
of Doc. may become easier, that is an issue which can be dealt with as part of trial costs.
As for the Jarvis Rule 39 examinations, again, the evidence was critical. AS AGAINST TEHSE
DEFENDANTS. There is no reason these costs should not be part of the motion costs.
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-4As for a junior costs at the hearing, given the issues and voluminous documents, I find it was
reasonable to have a junior in these circumstances. The Defendants had two counsel at the
hearing.
There are approximately 346 hours claimed. I am not persuaded that the settlement
discussions, which as I said were to resolve issues generally, should be included as part of this
motion’s costs. I find some of the hours claimed somewhat high:
1.
hearing on Dec 12 – 22 hours (for both)
2.
Negotiation and Preparation of R. 39 examinations (29 hours)
3.
Preparation for both hearing dates (70 hours)
I have considered the factors in Rule 57.01. In this case, there is a considerable amount of
money involved. These legal issues were complex and unnecessarily complicated by the
Defendants. Experienced counsel and junior counsel were necessary to deal with the volume of
materials filed, examinations, undertakings and voluminous production as well as considerable
investigation to deal with issues raised by the Defendants (many of which I found contradicted
by the documentation). The Minerva injunction was a critical step in this proceeding.
Conclusion:
In my view, a fair and reasonable amount, on a substantial indemnity basis, is $100,000 for
fees, plus $21,955 for disbursements (not challenged) plus HST, provided HST is not included
in the disbursements or fees on Schedule C of the Plaintiff’s submission, Payable within 30
days.
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