Date: 20090331
Docket: T-2207-03
Citation: 2009 FC 331
BETWEEN:
MERCURY
LAUNCH & TUG LTD.
Plaintiff
and
TEXADA
QUARRYING LTD.
Defendant
ASSESSMENT OF COSTS – REASONS
Charles E. Stinson
Assessment Officer
[1]
Further
to an eight-day trial, the Court dismissed with costs (the Decision) this
action addressing liability and damages relative to a barge which had broken
her moorings, grounded on nearby rocks and sustained heavy damage.
Subsequently, the Court directed (the Costs Decision) that the Defendant recover
“Column III (middle range)” costs, second counsel costs under fee item 14
(attendance at trial) and double costs from December 22, 2003. I issued a
timetable for written disposition of the assessment of the Defendant’s bill of
costs.
[2]
I
have considered the respective and able submissions of the parties on the
appropriate value from the available range for each counsel fee item, but have
not summarized them as I think that the restriction in Tariff B2(2), i.e. “an
assessment officer shall not allocate to a service a number of units that
includes a fraction,” does not preclude the broader jurisdiction exercised by
the Court under Rule 400(1), i.e. “full discretionary power over the amount and
allocation of costs”, and under Rule 400(4), i.e. “may fix all or part of any
costs by reference to Tariff B.” That is, the Court has in the past directed
mid-level or mid-range costs which the parties and the assessment officer, in
for example Aventis Pharma Inc. v. Apotex Inc. [2009] F.C.J. No. 56
(A.O.), have construed as permitting fractions of units, i.e. the value 5.5
units from the available range of 4 – 7 units for fee item 2.
[3]
The
Defendant here argued for example further to several Rule 400(3) factors that
the higher value, i.e. 6 units ($120 per unit), from the middle range, i.e. 5 –
6 units, should be allowed from the available range, i.e. 4 – 7 units, for fee
item 2 (statement of defence). In reply, the Plaintiff argued further to
several Rule 400(3) factors for the lower value of 5 units from said middle range.
I note that the available range for fee item 14 (attendance at trial) is 2 – 3
units per hour meaning that a middle range, if any, is not readily apparent.
The Defendant and Plaintiff argued for 3 and 2 units per hour respectively.
[4]
I
concluded in paragraph 7 of Starlight v. Canada, [2001] F.C.J. No. 1376
(A.O.) that the same point in the ranges throughout the Tariff need not be used
as each item for the services of counsel is discrete and must be considered in
its own circumstances. As well, broad distinctions may be required between an
upper versus lower allowance from available ranges. A direction by the Court
mandating the middle range might not necessarily permit allocation of a
fraction because it could be argued that said direction merely reduces, for
example, the range of 4 – 7 units to an available range of 5 – 6 units
without removing the Tariff B2(2) restriction above. That consideration
cannot easily be applied to a range of 2 – 3 units. That is, if one defines the
middle range as values greater than 2 units but less than 3 units on the
basis that the intent underlying a middle range award was to exclude the lowest
and highest values in the available range, no assessable value is possible. I
think that the term range implies a series of things as opposed to one thing.
Thus, the removal of the lowest and highest values from the available range
of 1 – 3 units for fee item 6 (attendance on a contested motion) leaves
the value of 2 units which is difficult to characterize as either a series or a
middle range. I have decided to simply allow mid-point values throughout,
including fractions.
[5]
Thus,
fee item 9 (attendance at discovery) results in 1.5 units per hour from the
available range of 0 – 3 units compared to 2 units per hour for fee item 11 (attendance
at conference) from the available range of 1 – 3 units. Issues of number
of allowable hours are addressed below. Those disbursement items of costs
not in issue, including postage ($15.37), corporate registry search ($8.50),
courier ($140.99), agent’s filing fee ($17.12), Environment Canada weather
reports ($608.01), marine charts ($45.60) and Registry hearing fees ($618.75),
are allowed as presented.
[6]
Further
to a request made the day before the hearing of the motion resulting in the
Costs Decision, counsel for the Defendant provided a draft bill of costs (the
Swanson Bill) to the Court. The Plaintiff’s materials for this assessment of
costs referred to the Swanson Bill for the purpose of challenging the
reasonableness of the Defendant’s bill of costs.
I. Counsel Fees
A. The
Defendant’s Position
[7]
The
Defendant asserted that the Swanson Bill was a draft prepared while second
counsel was out of the office. The bill of costs presented for assessment is a
much more carefully considered review of the costs and is supported by detailed
evidence. The Defendant argued that the GST rate of 6 percent should apply
because it was the rate applicable at the time that the counsel fees were
incurred and payable. If the GST is “simply a flow through expense” as asserted
by the Plaintiff, it would seem logical that it flow through at the same
rate it was paid.
B. The
Plaintiff’s Position
[8]
The
Plaintiff argued that the Swanson Bill, produced further to a specific request
from the Court, is likely a more accurate reflection of the work and costs
attributable to this litigation. The Swanson Bill’s claim for hearing
hours (33.5) under fee item 14(a) (attendance at trial) is considerably
less than the 47.5 hours claimed in the bill of costs. Another draft of the
bill of costs prepared by second counsel (whose time sheets would have been
accurate) shortly after judgment also claims 33.5 hours. The Defendant’s bill
of costs used the Court’s Abstract of Hearing which was presumably based
on the Court Registrar’s noted hours of attendance without factoring out lunch
breaks typically lasting 90 minutes. Fee item 14 imposes a different measure,
i.e. “per hour in Court.” GST is an “Input Tax Credit” which should be
allowed at the current rate (5%) as it is simply a flow through expense.
II. Assessment
[9]
My
findings in paragraph 102 of Abbott Laboratories v. Canada (Minister of
Health) (2008), 66 C.P.R. (4th) 301, [2008] F.C.J. No. 870
(A.O.) [Abbott] (under appeal) and in paragraph 15 of Estensen Estate
v. Canada (Attorney General) [2009] F.C.J. No.197 (A.O.) [Estensen]
indicate that I consider abstracts of hearing as a useful, but not absolute,
guide for assessing attendance at hearings which may have had a mix of shorter
or longer breaks for recesses and lunch. As well, I consider time getting
settled in the courtroom just prior to commencement as part of assessable
hearing time as opposed to preparation time within the meaning of fee items 5
for motions or 13 for trials.
[10]
Here,
my calculation of the total hearing time inclusive of lunches and recesses is
48.68 hours. Further to Abbott and Estensen, I will leave
the recesses (recorded by the Court Registrar in Minutes of Hearing with
durations varying from 9 to 20 minutes for a total of 2 hours 57 minutes) as
part of my fee item 14(a) calculation. However, I reduce the 48.68 hours by my
calculation of 9.94 hours total for lunches to 38.74 hours. I think that less
time would be required for getting settled in the courtroom as an eight-day
trial unfolded. I add 90 minutes total for that aspect of the trial appearance
to the 38.74 hours to give 40.24 hours for the item 14(a) calculation. I accept
the Defendant’s explanation of variances relative to earlier drafts of the bill
of costs.
[11]
Costs
are an indemnity and not a windfall. Part of my findings in Englander v.
Telus Communications Inc., [2004] F.C.J. No. 440 (A.O.) [Englander]
addressed and allowed GST as an indemnity. An indemnity compensates for
expenses out of pocket. Therefore, as the Defendant would have been liable to
pay the GST rate (6%) effective at the time it received the professional
services of its counsel, the rate of 6 percent applies here to its assessed
counsel fees. As GST would not have been paid at the time on any counsel fee
amount potentially subject to the doubling effect of the Costs Decision, I
apply GST only to assessed counsel fees before doubling of the latter. Doubling
does not apply to fee item 2 for the Statement of Defence which preceded the
settlement offer.
III. Disbursements
A. Claims for Photocopies ($2,024); Facsimiles ($270);
Long Distance ($199.48); Online Legal Research ($455.54); Travel ($5,084.41);
Court Reporter ($2,761.94); Surveyor Fees ($3,106.83) and Expert Fees
($20,449.23)
(1)
The Defendant’s Position
[12]
Counsel
for the Defendant billed $2,429.25 to his client for 8,097 photocopies
(correspondence, affidavit of documents and the documents, the parties’ written
representations, authorities, documents for experts’ use and trial documents)
at $0.30 per page, but has claimed only $2,024 based on $0.25 per page further
to cases which have allowed photocopying expenses in the face of less than
exhaustive proof, i.e. paragraph 7 of Canadian Union of Public Employees,
Local 4004 v. Air Canada, [1999] F.C.J. No. 464 (A.O.) and paragraph 4 of Forestex
Management Corp. v. Lloyd’s Underwriters, Lloyd’s London, [2005] F.C.J. No.
332 (Proth.) [Forestex]. The Plaintiff’s suggestion of a 20 percent
discount is arbitrary. The costs ($451.65 and $819.73) for a transcript of the
cross-examination at trial of the Plaintiff’s witnesses were essential for the
trial judge and for the Defendant’s oral and written submissions at trial.
[13]
The
Defendant argued further to paragraph 21 of Englander and paragraph 5 of
Smith v. R., [1985] 1 C.T.C. 140 (F.C.T.D.) that facsimile and long
distance costs were essential and allowable disbursements billed to the client
for communication with clients and witnesses on Texada Island and in the United
States. These costs included legitimate work after the trial, i.e. briefing the
client and pursuing costs. Online legal research to prepare for trial argument
was prudent and reasonably necessary in the circumstances at the time: see
paras. 48 to 55 of Pharmacia Inc. v. Canada (Minister of
Health and Welfare), [1999] F.C.J. No. 1770 (A.O.) and para. 24 of Englander.
Although dismissing that portion of the Defendant’s motion for increased Column
IV costs, the Costs Decision did allow the second counsel fees and doubling
sought in the same motion.
[14]
The
Defendant asserted that its witness, Denny Lyman, travelled from Texada Island to Vancouver for the
convenience of the Plaintiff’s counsel in discovering him. The meal claims are
restricted to the evening before and the day of discovery. Expenses relating to
a first aid course are not part of the $577.79 claimed for this trip. The
Plaintiff’s position concerning the attendance at trial by Mr. Lyman and Mave
LeClair overlooks the fact that the airfare for each was $288 and therefore
must be doubled to account for the total of $1,352.89 claimed for their travel.
There were separate entries for each hotel night for each of Mr. Lyman and Mr.
LeClair meaning there are no double charges as asserted by the Plaintiff.
[15]
The
Defendant hired a surveyor, Michael Fothergill, shortly after the incident to
view the barge following its grounding at Texada Island and later
when it was removed from the water at the Esquimalt Graving Dock. His work was
essential for preservation of evidence, i.e. photographs of damages and state
of the mooring lines. The assessment officer in Korea Heavy Industries &
Construction Co. v. Polar Steamship Line, [2002] F.C.J. No. 1369 (A.O.)
allowed costs for a survey report.
[16]
The
Defendant served three expert reports before the trial: Captain Don Rose
(mariner) who charged $4,560, Norman Allyn (engineer) who charged
$13,022.06 and Marc McAllister (naval architect) who charged $2,867.17. Captain
Rose’s opinion addressed standards in the tow boat industry concerning manning,
watch-keeping, the protection of equipment during severe weather and prudent
practice regarding the barge in the conditions existing on the day of the
incident. His work included discussions with counsel, review of documents,
preparation of a written opinion and attendance at trial. Mr. McAllister prepared
a report and gave evidence at trial addressing tonnage of the tug Ocean
Monarch further to the Defendant’s position that the small number of crew
members resulted in their fatigue by the time the barge was tied up at the
Defendant’s facility.
[17]
The
Plaintiff had alleged several instances of negligence and breach of duty by the
Defendant centering on the adequacy of the berth to moor the barge and
supported these allegations with an expert opinion by Carlos Johansen, a
professional engineer, critical of the fendering system, the mooring
arrangement and the berth operations. The Defendant countered this by engaging
Norman Allyn of Westmar Consultants Inc., a professional engineering firm in British
Columbia
with extensive experience in marine terminal design. Mr. Allyn’s work included
consideration of Mr. Johansen’s expert opinion and consultation with counsel to
develop strategy and questions for both Mr. Johansen’s cross-examination
and counsel’s technical understanding of the case. Ultimately, although Mr.
Allyn’s work was crucial for counsel’s approach to Mr. Johansen, it was not
necessary to call Mr. Allyn because the answers elicited in cross-examination
of Mr. Johansen helped the Defendant’s case.
[18]
The
Court in Sanmammas Compania Maritima S.A. v. “Netuno” (The), [1995]
F.C.J. No. 1442 (F.C.T.D.) [The Netuno] allowed the costs of an
expert witness not ultimately called on the basis that it was prudent and
necessary in the circumstances of the case because the other side had conceded
a point in issue after the costs had been incurred. The record here established
the necessity for Mr. Allyn’s work for the Defendant’s case. The Plaintiff’s
reference to a comment by the trial judge that she would not award costs of an
expert not ultimately called is irrelevant because it was made during the
hearing of the Defendant’s application for increased costs in which expert fees
were neither in issue nor argued. It was a general comment made without any
reference to the specific facts of this matter. His account dated January 9,
2006, after the trial, billed for work during the trial (December 5 to 15,
2005).
(2) The Plaintiff’s Position
[19]
The
Plaintiff argued further to Diversified Products Corp. v. Tye-Sil Corp.
(1990), 41 F.T.R. 227 (F.C.T.D.), Janssen-Ortho Inc. v. Novopharm Ltd.
(2006), 57 C.P.R. (4th) 6 (F.C.) and Okeynan v. Canada (Warden of
Prince Albert Penitentiary) (1998, 20 F.T.R. 270 (F.C.T.D.) that the claim
for photocopies should be reduced by about 20 percent to $1,600 to account for
“slippage” likely present in almost 8,100 copies, i.e. matters not chargeable
against the Plaintiff such as the billing as between solicitor and own client,
waste, error and duplication. Only charges essential to conduct are assessable
and this discount would address the lack of proof of the actual costs.
[20]
The
Plaintiff asserted that the evidence apparently indicates that $2.50 per
facsimile results in the $270 claimed (108 transmissions). The Court in Forestex
found $0.35 per facsimile too high (assuming three pages per facsimile) and
reduced it to $0.225 per page. That approach applied here results in $72.90
which should be further reduced to $60 to account for facsimiles well after the
trial.
[21]
The
Plaintiff argued that the evidence does not establish whether the amount of
$199.48 for long distance was actually incurred or whether it was simply an
amount charged to the file. As the Swanson Bill shows $192.75 and likely
includes calls after the judgment, this charge should be reduced by 20 percent
to $100. Similarly, the claim ($455.54) for online legal research should be
reduced to $100 in the absence of proof of relevance and actual cost. As the
Costs Decision dismissed the application for Column IV costs, any associated
research costs are not assessable.
[22]
The
Plaintiff conceded, of the $5,084.41 claimed for travel, $314.92 for the
Defendant’s counsel to travel to Texada Island the day after the incident to
gather evidence and interview witnesses; $398.73 for counsel to prepare
witnesses on Texada Island shortly before trial and amounts of $367.43, $323.40
and $184.66 for attendance from Texada Island at the trial by some of the
Defendant’s witnesses.
[23]
The
Plaintiff argued that the claim for Denny Lyman’s attendance on discovery
(November 25, 2004) improperly includes meals after the conclusion of the
discovery and extra BC Ferries charges, including two for “First Aid”
additional to an airfare. The evidence does not support the $1,352.89 claimed
for the attendance as witnesses at trial of Denny Lyman and Mave LeClair,
i.e. invoices only for accommodation ($576 which also includes a meal) and
meals ($211.19 including $150 for The Keg). If that portion of the hotel bill
of $1,564.59 for five of the Defendant’s witnesses which includes costs for Mr.
Lyman and Mr. LeClair is allowed, then the $576 above should be disallowed. In
all, the duplication and lack of proof should result in a reduction of the
$5,084.41 (travel) to $3,600.
[24]
The
Plaintiff conceded discovery transcript, but argued that $1,271.38 of the court
reporter claim should be disallowed because the request for expedited trial
transcript of certain evidence came from the Defendant and not the Court. There
is no justification for this expense given that second counsel presumably would
have taken notes of the evidence.
[25]
The
Plaintiff argued generally further to Apotex Inc. v. Wellcome Foundation
Ltd. (1998), 84 C.P.R. (3d) 303 (F.C.T.D.) [Wellcome] that the
experts’ costs to prepare affidavits, review other experts’ affidavits and
attendance at trial are assessable, but not to meet with counsel or if not
called at trial. The Plaintiff did not make concessions as contemplated by The
Netuno and therefore no costs are allowable for the expert not called, i.e.
Mr. Allyn.
[26]
The
Plaintiff argued that nothing should be allowed for the surveyor (Mr.
Fothergill) because the record does not establish his relevance. He was not
called as a witness, the Affidavit of Documents does not list a report or
correspondence by him, and other than some photographs, there is no evidence to
justify a charge of some $3,000.
[27]
The
Plaintiff argued that four hours or $480 should be removed from Captain Rose’s
invoice ($2,040) dated September 30, 2005, because interviews of the
Plaintiff’s past employees are the work of counsel and it is unreasonable to
charge for printing a copy of the Canada Shipping Act. His invoice
($1,440) dated December 21, 2005, should be reduced by $540 because it includes
4.5 hours for copying of documents and their delivery to the residence of
supervising counsel, both of which tasks were clerical and not expert
functions.
[28]
The
Plaintiff noted that neither Mr. Allyn nor anyone from his firm was called as
witnesses. The trial took place December 5 to 15, 2005. His firm’s invoices are
dated November 8 and December 9, 2005 and January 9, 2006, and his expert report
was likely served prior to November 22, 2005. His firm’s November 8, 2005
invoice claims more than 48 hours, i.e. review of documents by Mr. Allyn (14.5
hours), calculation by Dilip Barua of climate conditions (22.5 hours) and
assistance by Jack Wood in obtaining information on similar barge berths (10.5
hours). If the firm’s account is found recoverable despite Mr. Allyn not being
called as a witness, it should be reduced because his hours were excessive, the
work of the other two did not relate to the justification advanced in the
evidence for Mr. Allyn, and this firm’s work duplicated the work of counsel.
The December 9, 2005 invoice adds to the excessiveness, i.e. Mr. Allyn’s expert
report (11.5 hours), Mr. Barua on climate conditions (11 hours) and requisition
of more charts.
[29]
The
19.5 hours for Mr. Barua accounts for most of the firm’s January 9, 2006
invoice, but there is no justification for this charge given that the trial was
already underway and the indication that he was doing the work of counsel, i.e.
assembling of court document binders. There is no justification for his final
calculation notes being work that should have been long disclosed to opposing
counsel by November 22, 2005, as part of an expert report. The charge of five
hours for Mr. Allyn, presumably for trial preparation, is not assessable
as he was not called. Although Mr. Allyn was the purported expert, the
three firm invoices charged 53 hours for Mr. Barua’s work at $100 per hour on
wind and wave climate without establishing his relevance for supervising
counsel’s litigation strategy. If anything is to be allowed, it should be
limited to the 11.5 hours (at $130 per hour) taken by Mr. Allyn to prepare his
draft and final reports.
[30]
The
Plaintiff argued that, as paragraph 158 of the Decision found that Marc
McAllister’s evidence was “simply not relevant,” his charge ($2,867.67) should
be disallowed or restricted to a nominal amount.
IV. Assessment
[31]
My
findings in Halford v. Seed Hawk Inc., [2006] F.C.J. No. 629 (A.O.), Biovail
Corp. v. Canada (Minister of National Health and Welfare) (2007), 61
C.P.R. (4th) 33, [2007] F.C.J. No. 1018 (A.O.), aff’d [2008] F.C.J.
No. 342 (F.C.) and Abbott above set out my views on threshold of proof
for categories of costs and approach to their assessment. Paragraphs 68 to 72
inclusive of Abbott above summarize the subjective elements and the
notion of rough justice in assessments of costs. In Fournier Pharma Inc. v. Canada (Minister of
Health),
[2008] F.C.J. No. 1151 (A.O.), I indicated in paragraph 30 that “if I can
recognize a reasonable charge given an invoice, I can likely recognize one
without an invoice, albeit with more difficulty.”
[32]
The
Defendant likely made essential disbursements for photocopying and facsimiles
for which the cost of absolute proof might be prohibitively expensive. The
Plaintiff is likely correct that some costs were unnecessary. I commented in
paragraph 65 of Abbott about the appropriate balance to be struck in such
circumstances. I allow $1,750 and $230 respectively for photocopies and
facsimiles. I find that the long distance charges are reasonable in the
circumstances and allow them as presented at $199.48.
[33]
Paragraph
111 of Abbott outlined my usual concerns with computer research. The Costs
Decision gave lump sum costs of $250 to the Plaintiff for the Defendant’s
motion. That means the Defendant is precluded from any associated costs. I have
taken that into account for my allowances for other disbursement categories as
well as for online computer research which I allow at a reduced amount of $360.
[34]
I
think that the decision by the Defendant’s counsel to procure the trial
transcript was prudent. However, the considerable experience at the time of
lead counsel for the Defendant as a maritime law practitioner in the tug and
tow industry was such that the acquisition of expedited transcript was not as
critical to the outcome as to warrant the Plaintiff having to indemnify the
Defendant for its costs. I therefore remove the $1,271.38 as suggested.
[35]
The
expense report for Denny Lyman’s discovery costs calculated the claimed amount
of $577.79 by deducting $57.50, an amount not readily apparent in the evidence,
from a total of $635.29 (hotel, meals, airfare and car). The BC Ferry receipts
marked “First Aid Course” are dated about a week before his discovery, and
being for identical legs (Powell River to Texada Island) on successive days are
likely not relevant. The other BC Ferry receipts address a roundtrip between
Horseshoe Bay and Nanaimo on November 15, 2004 (his discovery was on November
25), a trip from Powell River to Comox on November 10, 2004, and a trip from
Powell River to Texada Island (“return from” marked on the receipt) sometime in
the period November 20 – 29, 2004 (the date was cut off in the exhibit). This
latter trip might mesh with the one-way airfare ($150.52) from Vancouver to Power River on the
morning of November 26, 2004, except that its time is also cut off. This is all
somewhat obscure. I resolve it by simply finding that it was reasonable for him
to arrive the night before (November 24) and leave the day after (November 26)
thereby giving time both to consult with supervising counsel and to be
discovered. Therefore, his hotel bill ($187.20) and meals ($81.82) are in
order. His one-way airfare ($150.52 for Vancouver to Powell River) is
somewhat consistent with roundtrip airfares of $245 in 2002 and $285 and $244
in 2005 between Vancouver and Texada Island for a lawyer and
various witnesses. Two one-way fares of $150.52 and a ferry each way between Powell River and Texada Island ($19.25
x 2) added to the meals and hotel above total $608.56. If only airfares of $244
(Mr. Lyman’s actual fare to attend the trial) and $285 are used, the
totals are $513.02 and $554.20 respectively. I reduce the $577.79 by $64.77 to
$513.02 (as noted by the Plaintiff, these amounts are inclusive of tax).
[36]
If
there is confusion about the trial attendance expenses of Denny Lyman and Mave
LeClair, it might stem from the assertion in the evidence that the $1,352.89
includes hotel costs (two rooms for one night) for both further to an expense
report listing $576.30 for hotels for both, but appending only Mr. Lyman’s
receipt for his two nights. A separate amount of $1,564.59 claimed for trial
attendance by five witnesses including Mr. Lyman and Mr. LeClair asserts for
Mr. LeClair “two nights – one room for Mr. LeClair, one room for Mr. Lyman,”
yet appends only Mr. LeClair’s receipt for his two nights. The hotel advance
booking confirmation indicates only one night for each. Although not clear from
the evidence, I am satisfied that duplication of costs has not occurred if I
simply assume that Mr. Lyman’s hotel costs for two nights fall only within the
$1,352.89 and Mr. LeClair’s hotel costs for two nights fall only within the
$1,564.59. The overall result is the removal of the $64.77 above leaving travel
assessed at $5,019.64.
[37]
I
find the use by supervising counsel of a surveyor necessary and reasonable in
the circumstances of this litigation and allow the claim of $3,106.83 as
presented further to my examination of his invoice.
[38]
In
paragraphs 38 – 40 of Aventis Pharma Inc. v. Apotex, Inc., [2009] F.C.J.
No. 56 (A.O.), I reinforced my view that an assessment of costs should
reflect the reality of the demands of litigation. That process includes careful
consideration of submissions advanced as here succinctly by the Plaintiff’s
counsel on both the sufficiency of the evidence and the reasonableness of the claim
for experts. With respect, I am uncertain as to how the bar in Wellcome
to compensation for the time of experts in meeting with counsel can be
reconciled with the practical and reasonably necessary requirement, in my view,
of having supervising counsel shape, further to meetings either in person or by
teleconference, an expert’s work to mesh with the former’s case strategy.
Compensation for the role of counsel is limited by the partial indemnity
provisions of the Tariff as required by Rule 407, but compensation for the
role of an expert is generally fully recoverable within the limitations of
reasonable necessity, Tariff A3(4) and Tariff B1. Paragraphs 61, 66 and 76 - 79
inclusive of Halford indicate the importance of supervising counsel for
the mandate of experts. Costs for the time of experts meeting with
supervising counsel are assessable if necessary and not duplicative of either
previous meetings or work more properly the responsibility of supervising
counsel.
[39]
I
doubt that the printing of a copy of the Canada Shipping Act amounted to
any significant amount of Captain Rose’s time. His charge to speak to past
employees of the Plaintiff might be recoverable if it could be said that his
expertise was so distinguishable from that of experienced maritime supervising
counsel that only he could formulate, ask and evaluate the questions and
answers. I find the record here too obscure to permit that distinction.
However, these two pieces of work occurred and were charged as part of
eight hours which also included the review and analysis of key documents and
reports, and the writing of his opinion. I think that the Plaintiff’s suggested
reduction of the $960 by four hours ($480) for this particular period is too
much: I reduce the $960 by 1.5 hours ($180). I am not satisfied on the record
that the Defendant should recover at an expert’s rate the costs for what appears
to be simply clerical work, i.e. photocopies and delivery. However, I concede
that there would have been costs to produce and deliver the materials to
supervising counsel and therefore I reduce this portion of Captain Rose’s
account by $70 in place of the $540 suggested by the Plaintiff. The result is
that his account is reduced from $4,560 to $4,310.
[40]
Captain
Rose’s invoices include several hours for meetings with supervising counsel. I
have read his opinion. Differing views exist on compensation for the use of
experts. I find that no further reductions of Captain Rose’s account are
warranted.
[41]
In
Merck & Co. v. Apotex, [2002] F.C.J. No. 1116 (A.O.) aff’d [2002]
F.C.J. No. 1357 (F.C.T.D.), I addressed the roles of experts and their
supervising counsel, and in paragraphs 29 and 40 held that costs for
experts not ultimately called (apart from those clearly superfluous) were assessable.
Paragraphs 94, 100, 101 – 105, 215 – 217, 224 and 234 of Halford also
address circumstances of costs allowed for witnesses prepared but not
ultimately called. I find in the circumstances here that the Defendant should
be indemnified for the costs of Mr. Allyn subject to the threshold of
reasonable necessity.
[42]
I
have read Mr. Allyn’s opinion and examined his credentials. The latter together
with his billing rate of $130 per hour, compared to $110 per hour and $100 per
hour for Mr. Wood and Mr. Barua respectively, likely indicate he was
senior to the latter two individuals. I can only speculate that Mr. Allyn’s
experience, albeit applied at a higher rate, might have achieved the same results
as Mr. Wood and Mr. Barua, but with fewer hours and a lower overall charge. The
first invoice (November 8, 2005) for $5,968.87 charged 48.75 hours plus
disbursements for photocopies, charts and maps, and is allowed as presented.
The second invoice (December 9, 2005) adds 24.5 hours more for these three
individuals (plus 3.5 hours for work by others) for some work in the same vein
plus report writing. Together with the first invoice, that represents about ten
days of work, which is what I might expect. I allow the second invoice as
presented at $3,498.59.
[43]
The
third invoice (January 9, 2006) contains two headings of work, i.e. court
document binders and final calculation notes, but does not specify the number
of hours of the claimed total of 26.75 hours attributable to each. The
final calculation notes by Mr. Barua presumably were part of Mr. Allyn’s
preparation to testify. I agree with the Plaintiff that the work to prepare
court document binders on its face could very well occur in a solicitor’s
office. While I concede that costs are assessable for Mr. Allyn’s work to
prepare directly for the hearing, I am not convinced that the Plaintiff should
be responsible for the full $3,554.50 and I therefore reduce the third invoice
to $1,200 thereby reducing Mr. Allyn’s claimed account of $13,021.96 (amount
corrected further to an inadvertent discrepancy in the evidence concerning the
November 8, 2005 invoice) to $10,667.46.
[44]
An
Order issued November 16, 2005, further to a trial management conference about
three weeks before the trial, directed inter alia that the parties
exchange briefs of their objections concerning the admissibility of one
another’s expert evidence and that the trial judge would hear their objections
on the first day of trial. I have read those briefs. Part of the Plaintiff’s
objection to the proposed expert opinion of Marc McAllister included an
assertion that as his stated parameter was an opinion on tonnage, he could
not testify on ramifications or operational requirements of the tug relative to
its tonnage. The Decision does not outline specifics of a ruling on the
admissibility of his evidence, but as paragraph 158 indicates that he was a
competent and credible witness, his opinion apparently was admitted even if
paragraph 158 said it was “simply not relevant.” However, I do not take that
latter assertion as implying that the disbursement for his work was not prudent
and should not be indemnified as part of a reasonable or credible line of
defence. Rather, I understand it as an indication that Mr. McAllister’s opinion
was not relevant for the conclusion in paragraph 161 that “this accident and
the damage to the Barge were caused by the negligence of the master of the
Ocean Monarch.”
[45]
Paragraphs
11 and 14 of the Defendant’s Outline of Fact and Law dated and filed
November 22, 2005 before trial asserted that Mr. McAllister’s expert
evidence would demonstrate that the tonnage of the Plaintiff’s tug was
artificially reduced from about 60 tons to less than 10 tons to avoid certain
regulatory requirements for vessels over ten tons, one of which was that it
have a certificated master and that the Ocean Monarch’s master was not
certificated. Paragraphs 81 and 85 – 89 asserted opinion evidence from
Captain Rose and Mr. McAllister of fatigue and lack of certification as the
source of the Plaintiff’s negligence. I read the pleadings and the Agreed
Statement of Facts, as well as the closing arguments submitted by both sides.
Paragraphs 80 – 97 of the Defendant’s closing argument pursued this line
of defence.
[46]
I
find that the Defendant’s counsel acted prudently for his client in advancing
this line of defence even if ultimately it was not determinative. In paragraphs
23 – 57 inclusive of Halford, I found that an award of costs is not
distributive and therefore costs for Mr. McAllister associated with this line
of defence are assessable to the extent they were reasonable and necessary in
advancing it.
[47]
Mr.
McAllister’s first invoice for $2,264.67 (at $100 per hour for 20.25 hours +
GST + disbursements of $97.92 for reproductions and parking) addressed
preparation of his report and discussing it with supervising counsel. I allow
it as presented. His second invoice for $602.50 included 2.25 hours on the day
before he testified to review “and rephrase opinion report” (his time log
indicated review “file and alter report at the request of” supervising
counsel). I expect last minute preparation by a witness including
time meeting with counsel, but not alteration of an opinion presumably not
susceptible to change having been served on the adverse party. The Plaintiff
should not have to pay for that. The balance of this invoice addressed time in
court testifying. I reduce this invoice by $107 inclusive of GST leaving
his account approved at $2,760.17. The total costs for experts are therefore
reduced from $20,449.23 to $17,737.63.
[48]
The
Notice of Motion giving rise to the Costs Decision requested that to the
“extent any direction is necessary” double costs be allowed to the date of
judgment. That provision accords with the ordinary allowance in Rule 420(2)(b)
and did not require an order. The Costs Decision did not restrict the Defendant
from claiming double fees past the date of judgment and I therefore have not interfered
with the doubling of fee item 26 in the bill of costs. The Defendant’s bill of
costs, presented at $110,998.97, is assessed and allowed at $88,369.73.
“Charles
E. Stinson”
Email this Content