Date: 20010614
Docket: T-2092-97
Neutral Citation: 2001 FCT 658
Ottawa, Ontario, this 14th day of June, 2001
PRESENT: THE HONOURABLE MR. JUSTICE JOHN A. O'KEEFE
BETWEEN:
WALTER A. CONOHAN,
P. O. Box 114, Cardigan, Prince Edward Island, C0A 1G0;
- and -
EASTERN MARINE UNDERWRITERS INC.,
a body politic and corporate, having a place of business
at Suite 10, 620 St. Jacques Street, Montreal, Quebec, H3C 1C7;
Plaintiffs
AND:
THE COOPERATORS,
a body politic and corporate, having a place of business at
281 University Avenue, Charlottetown, Prince Edward Island, C1A 4M3
Defendant
REASONS FOR ORDER AND ORDER ON COSTS AND INTEREST
O'KEEFE J.
[1] The parties were given an opportunity to make submissions on costs and interest to me and such written representations have been filed by both parties.
Costs
[2] The statement of claim in this action was filed on April 16, 1997 and the defence was filed on November 6, 1997. The pre-trial conference was held in June, 1999. The defendant made the following offers to settle which were not revoked:
Date Amount
January 7, 2000 $20,500.00
May 15, 2000 $47,483.17
The offer of May 15, 2000 had been communicated by letter to the plaintiffs on April 19, 2000. The trial of this matter commenced on May 30, 2000.
[3] Rule 420(2)(b) of the Federal Court Rules, 1998 SOR/98-106 states:
| 420.(2) Unless otherwise ordered by the Court, where a defendant makes a written offer to settle that is not revoked,
(a) . . .
(b) if the plaintiff fails to obtain judgment, the defendant shall be entitled to party-and-party costs to the date of the service of the offer and to double such costs, excluding disbursements, from that date to the date of judgment.
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42(2) Sauf ordonnance contraire de la Cour, lorsque le défendeur présente par écrit une offre de règlement qui n'est pas révoquée et que le demandeur:
a) . . .
b) n'obtient pas gain de cause lors du jugement, le défendeur a droit aux dépens partie-partie jusqu'à la date de signification de l'offre et au double de ces dépens, à l'exclusion des débours, à compter du lendemain de cette date jusqu'à la date du jugement.
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The plaintiffs did not obtain judgment, therefore the provision of Rule 420(2)(b) applies unless the Court otherwise orders. The plaintiffs have pointed out in their submissions that the point on which the defendant succeeded was not raised until closing argument. That is not completely correct because by a letter to the plaintiffs' previous counsel dated May 6, 1997, the defendant did raise the point on which it succeeded. The point apparently was not mentioned at the pre-trial conference. The plaintiffs were aware from May 6, 1997 that the defendant was taking this position. This case is different from the situation in Floyd v. Hansen [1915] 24 D.L.R. 320 (N.B.S.C. Ch. Div.) where White J. stated at page 325:
It is only upon the defence raised by the defendant for the first time at the trial, that she has succeeded; and I therefore think there should be no costs of suit to either party.
Nor is it the situation described by Orkin in The Law of Costs (Mark M. Orkin, Q.C., The Law of Costs, looseleaf Aurora Canada Law Book 2000) at paragraph 205:
Costs will not as a rule be allowed to a party who succeeds at trial on a point not pleaded or raised prior to the trial. . . .
[4] In this case, the point was raised in a letter shortly after the statement of claim was filed. There does not appear to have been any further mention of this point until closing argument. Both counsel addressed the point in closing argument. This is not a case where the defendant should be deprived totally of its costs, but I believe that the defendant should receive 50% of its party and party costs.
[5] The next issue is whether the defendant should receive double the costs I have awarded above pursuant to Rule 420(2)(b) of the Federal Court Rules, 1998 from January 7, 2000 (the date of the offer to settle) until November 28, 2000. There is no doubt the plaintiffs did not receive more than the amount of the offer. I am prepared to award the defendant 75% of its costs from January 7, 2000 to November 28, 2000. Had there been no offer to settle, I would have awarded the defendant only 50% of its party and party costs for this period. Thus, the amount I am now awarding is 150% of the amount I would have given for this period had there been no offer to settle. In making my decision, I have considered the fact that the first offer to settle was not served until January 7, 2000, and the fact that the trial was scheduled to commence on May 30, 2000.
[6] The defendant is entitled to have the costs assessed in accordance with Column III of the table to Tariff B. Costs for the attendance of the defendant's second counsel shall be allowed.
[7] The defendant is entitled to its reasonable disbursements as assessed by the assessment officer which will include GST and PST.
Interest
[8] The only interest that need be addressed is interest on the defendant's award of costs. Since the collision happened approximately 22 miles off Souris, I am not certain that the cause of action arose in Prince Edward Island. However, I am prepared to apply subsection 37(1) of the Federal Court Act, R.S.C. 1985, c. F-7 and section 51 of the Supreme Court Act, R.S.P.E.I. 1988, Cap S-10 and award post-judgment interest on the amount of the plaintiffs' assessed costs pursuant to section 51 of the Supreme Court Act.
ORDER
[9] IT IS HEREBY ORDERED pursuant to my earlier Order that:
1. The defendant shall have 50% of its party and party costs up to and including January 7, 2000.
2. The defendant shall have 75% of its party and party costs from January 7, 2000 to November 28, 2000.
3. Costs shall be assessed on the Tariff B Column III scale.
4. Costs for the attendances of the defendant's second counsel shall be permitted.
5. The defendant shall recover its reasonable disbursements as assessed by the assessment officer, including reasonable amounts incurred for the services of advisors and experts.
6. The defendant shall recover any service, sales, use or consumption taxes paid or payable on counsel fees or disbursements allowed under Tariff B.
7. The defendant shall be entitled to post-judgment interest pursuant to subsection 37(1) of the Federal Court Act, R.S.C. 1985, c. F-7 and section 51 of the Supreme Court Act, R.S.P.E.I. 1988, cap. S-10.
8. Costs shall be assessed by the assessment officer and the defendant shall be entitled to its costs of these submissions, as assessed by the assessment officer.
"John A. O'Keefe"
J.F.C.C.
Ottawa, Ontario
June 14, 2001
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