Date: 19990325
Docket: T-323-98
IN THE MATTER OF the decision of an
arbitrator, Me. Roland Tremblay, Q.C.,
dated September 16, 1988;
IN THE MATTER OF the Canada Labour Code,
R.S.C. 1985, c. L-2, as amended
BETWEEN:
LOCAL 4004, AIRLINE DIVISION OF
CANADIAN UNION OF PUBLIC EMPLOYEES
Applicant
- and -
AIR CANADA
Respondent
ASSESSMENT OF REASONS - COSTS
Charles E. Stinson
Assessment Officer
[1] The Applicant registered an arbitral award addressing the assignment of cabin crews and brought proceedings for show cause for contempt relative to its assertion that the Respondent had failed to comply. By Order dated November 18, 1998, the Honourable Mr. Justice Joyal dismissed the show cause application with costs to the Respondent at the highest level of units set out in Column III of Tariff B. The Respondent presents its Bill of Costs for fee item numbers 3, 5, 6, 8 and 9 being respectively amendment of a document, preparation of a contested motion, appearance on a motion, preparation for cross-examination on an affidavit and attendance on cross-examination of an affidavit and for disbursements for transcripts and photocopies.
Applicant's Submissions
[2] Counsel for the Applicant noted that she wanted to avoid an unnecessary appearance but the lack of response to her request for details of the hours claimed for appearances required that the Assessment Officer hear the parties to confirm the proper amount to be paid by the union members. The Tariff does not provide indemnification for hours of appearance not actually occurring. For item number 6, the hours claimed for June 22 and October 28, 1998, are correct but the law firm's records show that the 5.80 hours claimed for October 6, 1998, should be 5.1 hours. The response to our request for clarification, that the Bill of Costs and supporting affidavit of Douglas S. Gilbert sworn December 10, 1998, speak for themselves, does not meet the onus in the Tariff for proof of a specific number of hours. As well, the lack of detail in the evidence of Mr. Gilbert's hourly rate precludes confirmation that the claim of 3 units for this item, effectively being $300.00 per hour, does not result in full solicitor-client indemnification or in a profit by reason of costs. That lack of detail could result in the union paying monies offsetting fees incurred for items not listed. For item no. 9, the hours claimed for August 27 and September 25, 1998, are correct but the law firm's records show that the 7.0 hours claimed for August 25, 1998, should be 6.5 hours. Given the location of the law firm and the cross-examination, the travel time should have been minimal.
[3] The Applicant does not dispute the other fee items as presented other than to question whether the Respondent should be restricted to a single fee in item no. 8 for preparation for several cross-examinations as opposed to the three claims of 5 units for preparation for multiple cross-examinations on three different dates. As well, the Applicant opposes any units for item no. 26 for assessment of costs, not presented in the Bill of Costs but advanced before me, because its objections were not frivolous and were a function of deficiencies in the evidence. The Applicant does not dispute the disbursements for transcripts nor the number of pages presented for photocopies but it does object to the photocopy rate of $0.30 per page which is higher than the rate for cost recovery in our office. A lower rate in the range of $0.15 to $0.20 per page, but not necessarily as low as the Legal Aid rate of $0.10 per page, would be suitable. This objection is not intended in any way to reflect on the billing practice of the firm but rather to address the appropriate amount for the union members to pay. Any comparison to the $0.40 per page charged by the Registry in Tariff A1(3) is irrelevant because that is predicated on a different rationale for partial cost recovery from users of a Court.
Respondent's Submissions
[4] The Respondent asserted that it had pared the Bill of Costs to the minimum permitted by the Tariff to promote settlement and avoid an appearance. For example, this complex matter required some travel for preparation with the client but the associated costs are not claimed. For item no. 6, counsel for the Respondent disclosed that, as an associate, she bills $225.00 per hour, noted that she attended with Mr. Gilbert on the motion and asserted that she could confirm the 5.8 hours by reason of her direct involvement. She did not attend with Mr. Gilbert on the cross-examinations. She does not have his billing rate which, for a partner in the firm, would be higher than her own. However, the hourly rate is not relevant because the dollars assessed overall would tend to balance low compensation for other items such as the 7 units for preparation for the motion. For this quasi-criminal matter, that preparation cost about three to four times that $700.00. Our response to their request for details was that they attended as well and the hours were as shown. The correspondence did not mention 5.1 hours nor indicate that the count for hours was in dispute. Our practice is to bill for time in transit. For item nos. 6 and 9, counsel indicated that the hours were extracted from dockets that, in some instances, had other services included. Counsel attempted to properly sever those hours associated only with the authorized fee items. She cannot confirm whether those hours included time in transit. If it comes to that, the Respondent will accept the 6.5 hours. As for item no. 8, the Tariff permits those fee items as presented.
[5] The affidavit of Mr. Gilbert confirms that the client was charged $0.30 per page which is less than the $0.40 per page charged by the Registry. This was not a Legal Aid case restricted to its rates. As for fee item no. 26 for assessment of costs, the 6 units authorized by the Order is a flat rate for all associated services. The Applicant did not advise us before this appearance to assess costs that it had differing records of hours. Said appearance may result in minimal reductions which, according to comments from the Assessment Officer on photocopies, would have occurred in any event.
Assessment
[6] For item no. 6 for October 6, 1998, I allow the 5.8 hours presented. The Court Registrar's Abstract of Hearing disclosed a duration of 5.1 hours based on the precise times for the start and end of submissions. However, consistent with the excerpt below from Dableh, that does not have to limit the discretion of the Assessment Officer in considering other factors defining duration. Counsel for the Respondent was firm in her assertion of the correctness of her records given her personal attendance. It may be that differing recollections of the day's events resulted in inconsistency between the docket entries for the respective firms. As for the Applicant's concern for excessive indemnification based on hourly rate, I considered comparable concerns at pages 14-15 on March 31, 1998, in A-539-93: Dableh v. Ontario Hydro:
| ...Tariff B addresses all taxable events in the litigation but not necessarily all events, ie. settlement discussions. Plaintiff's position was that if the amount taxed for a given individual event (such as here for counsel's appearance on September 10, 1990) exceeded the actual amount for that event paid by the client to his lawyer (as the evidence established here for September 10, 1990), that would be permissible because the total dollars on taxation allowed for all taxable events would be less than the actual dollars paid by the client to his lawyers for all of those taxable events. That position is impractical in some instances. For example, if costs were granted in a single interlocutory matter/event thereby cutting short the litigation, as here for Hydro-Quebec and the New Brunswick Electric Power Commission, there would be an insufficient number of taxable events generating total dollars sufficient to offset, for a particular event, taxed dollars exceeding the actual amount, on the evidence, billed to the client. As well, Rule 346(1.1) does not permit suggest such offsets. Rule 344(6) permits adjustments. This issue of excessive indemnification arose because both sides tended to assume throughout this taxation that the number of units for hourly items such as B6 translates directly to a comparison of the hourly rate of counsel actually billed to the Plaintiff herein, in the absence of evidence to the contrary. The explanatory note to Amending Order No. 17, SOR/95-282, suggests otherwise. However, the Honourable Mr. Justice Cattanach on September 24, 1982, in T-4042-98: George Ferguson v. Commissioner for Federal Judicial Affairs on marginal notes suggests, to me, that such commentary must be applied carefully. The legislation as promulgated must apply.... |
In contrast to old Rule 346(1.1), the new Rule 409 does not preclude consideration of the effect of offsets. However, given that the Assessment Officer cannot vary the constitution of the award of costs crystallized in the judgment of the Court by, for example, approving indemnification for items not contemplated by the Tariff, that consideration would be applied within narrow parameters. For example, item nos. 14 and 22, addressing units per hour for the appearance of counsel, specifically distinguish between first and second counsel. Item no. 6, also addressing units per hour for the appearance of counsel, does not. Counsel for the Respondent indicated that she attended in Court with Mr. Gilbert. That suggests to me, in the absence of the dockets, that the billing to the client for all counsel likely exceeded the equivalent of 3 units per hour. For that reason, and given disclosure of her rate, I saw no reason to compel disclosure of Mr. Gilbert's higher rate. As to whether the result on assessment approximates solicitor-client costs, that portion of the Order specifying use of the highest level of the ranges limits consideration of that factor in the circumstances here. For item no. 9 for August 25, 1998, I reduce the 7.0 hours to 6.5 hours. The materials were inconclusive one way or the other and I opted for the conservative estimate.
[7] The use of the indefinite article, "an", in the introductory words for item no. 8, permits a separate claim for preparation for each cross-examination conducted. It may be that, on the materials in given circumstances, the passage of time alone will not support a claim for fresh preparation each time litigants return to an individual. Here, I allowed the three claims under item no. 8 for preparation for cross-examination on the affidavits of five deponents. For item no. 26, I note that litigants sometimes advance a claim for costs not identified in the Bill of Costs. That seems consistent with the reality that it is an item for which the event is not complete at the time of the drawing of the Bill of Costs, and that it is a global amount incorporating a future appearance. The number of units claimed could be affected by the issues not settled beforehand and remaining for resolution at the hearing. The Applicant's objections were not frivolous but I think that the circumstances would have to be exceptional for that to be a factor in denying any costs at all. The 6 units advanced were consistent with the Order and I allow them. As for photocopies, I indicated to counsel appearing before me that there exists divergency of opinion on in-house photocopies. The Reasons of Reinhardt A.O. on May 11, 1998, in T-2234-89: Allied Signal Inc. v. Dupont Canada Inc. et al. at pages 25-33, summarize that divergence. Given the reality of approval of this category of disbursement in other jurisdictions (see, for example, item nos. 31 and 32 in Part II of Tariff A to the Ontario Rules of Civil Procedure), I continue to allow photocopies, in the absence of exhaustive proof, as here, of the rate, at $0.25 per page. I do not think that the promulgation on April 25, 1998, of the new Rules for costs diminished my view of the discretion exercised by Assessment Officers as set out at pages 33-34 in my Reasons dated June 3, 1996, in A-333-94: Byers Transport Limited v. Dorothy Kosanovich et al:
| The evidence was not exhaustive but there was more than in some Court files I have seen. Copies for the client are informative but not necessarily essential. However, they can be of use in setting cogent instructions. It may be that not everything was copied for the client: the evidence is not clear on that. I note that Kosanovich has been able to tax her fees for contacts with counsel. The client's solicitor, equipped with proper instructions, is a professional who should have a copy of everything and who can function even if the client does not or just has certain key documents. Taxing Officers are often faced with less than exhaustive proof and must be careful, while ensuring that unsuccessful litigants are not burdened with unnecessary or unreasonable costs, to not penalize the successful litigant by denial of indemnification when it is apparent that real costs were indeed incurred. This presumes a subjective role for the Taxing Officer in the process of taxation. My Reasons for Taxation dated November 2, 1994, in T-1422-90: Youssef Hanna Dableh v. Ontario Hydro, cite, at page 4, a series of Reasons for Taxation shaping the approach to taxation of costs. Dableh was appealed: in Reasons for Order dated April 7, 1995, the Associate Chief Justice concluded at pages 3-4: |
| Having reviewed the evidence in this case, it is clear that the amounts taxed were fair and reasonable under the circumstances. The issue of the amount of trial time allocated to the counterclaim was a highly contentious issue that lacked substantiation from either side. This coupled with the words of Muldoon, J. that the counterclaim was "so assimilated to the defence", indicates that the wide exercise of discretion was required. The Taxing Officer is in a better position to determine these matters. Even if I would have exercised my discretion in a somewhat different manner, I am not convinced that the fees and disbursements granted are excessive or that the apportionment between the claim and counterclaim was capricious. Consequently, this does not satisfy the threshold requirements of IBM Canada, supra, that would warrant my interference. |
| Accordingly, this application must fail, with costs. |
| As well, one of the Reasons for Taxation referred to above and dated July 3, 1991, in T-705-89: United Terminals Limited v. The Minister of National Revenue et al., distinguished Teitelbaum, J. in Diversified supra concerning photocopies and allowed them in essentially the same circumstances as exist here. I have considered disbursements in the Bill of Costs in a manner consistent with these various pieces of jurisprudence. Sworn statements of counsel asserting reasonableness and necessity cannot usurp the responsibility required of Taxing Officers to arrive at their own independent conclusions. |
[8] The Bill of Costs of the Respondent, presented at $16,281.65, is assessed and allowed at $16,674.30.
(Sgd.) "Charles E. Stinson"
Assessment Officer
Dated this 25th day of March, 1999.
NAMES OF COUNSEL AND SOLICITORS OF RECORD
STYLE OF CAUSE: IN THE MATTER OF the decision of an
arbitrator, Me. Roland Tremblay, Q.C.,
dated September 16, 1988;
IN THE MATTER OF the Canada Labour Code,
R.S.C. 1985, c. L-2, as amended
BETWEEN: LOCAL 4004, AIRLINE DIVISION OF
CANADIAN UNION OF PUBLIC EMPLOYEES
- and -
AIR CANADA
COURT NO.: T-323-98
DATE OF HEARING: March 2, 1999
PLACE OF HEARING: Toronto, Ontario
ASSESSMENT OF COSTS - REASONS BY: CHARLES E. STINSON
ASSESSMENT OFFICER
DATE OF REASONS: March 25, 1999
APPEARANCES:
Lucy McSweeney for the Applicant
Damhnait ("Downith") Monaghan for the Respondent
SOLICITORS OF RECORD:
Eberts Symes Street & Corbett for the Applicant
Toronto, Ontario
Heenan Blaikie for the Respondent
Toronto, Ontario