Date: 20090427
Docket: A-336-08
Citation: 2009 FCA 130
BETWEEN:
APOTEX INC.
Appellant
and
LUNDBECK CANADA INC.
Respondent
and
THE MINISTER OF HEALTH
Respondent
and
H. LUNDBECK A/S
Respondent/Patentee
ASSESSMENT OF
COSTS - REASONS
Johanne Parent
Assessment Officer
[1]
By
way of order dated September 15, 2008, the Court allowed with costs the appeal
of a decision of the Federal Court. The lower Court’s decision was from an
appeal of a decision of Prothonotary Morneau in which he had dismissed the
respondent Lundbeck’s motion to strike an affidavit, plus paragraphs and
exhibits to three other affidavits referring to that affidavit. In the same
decision, the Court of Appeal also dismissed with costs the respondent
Lundbeck’s cross-appeal. A timetable for written disposition of the assessment
of the appellant’s bill of costs was issued on December 2, 2008. The assessment
of the bill of costs will now proceed, taking into consideration the parties’
written submissions. The Minister of Health took no position and has not
participated in this proceeding.
[2]
Considering
the specifics of the file along with the factors listed in subsection 400(3) of
the Federal Courts Rules, more specifically the appellant’s success on
the majority of elements brought in the appeal and cross-appeal, the relative
complexity and importance of the issues regarding the evidence to be brought
forward on the main application, I am of the opinion that Apotex’s request for
mid-level of Column III is justified.
[3]
Items
17 (preparation, filing and service of notice of appeal), 18 (preparation of
appeal book) and 25 (services after judgment) are not contested and allowed as
claimed.
[4]
In
keeping with article 2(2) of Tariff B: “On an assessment, an assessment officer
shall not allocate to a service a number of units that includes a fraction”,
Item 19 (memorandum of fact and law) will be allowed at five units regardless
of the five and one half units claimed.
[5]
For
that same reason, the 2.5 units claimed under Item 22 for the attendance of
first counsel at the hearing before the Court of Appeal on September 15, 2008, will
be allowed 2 units for the 1.1 hours claimed. Taking into consideration that
the Court did not provide any directions allowing fees for second counsel, the
claim for second counsel is disallowed: see Nature’s Path Foods Inc. v.
Country Fresh Enterprises, 2007 FC 116.
[6]
Item
27(a) claimed for the preparation of the Bill of Costs is allowed as claimed
but under Item 26.
[7]
The
disbursements incurred by the appellant are substantiated in the affidavit of
David Lederman and the appellant’s written representations filed in support of
the bill of costs. The respondents Lundbeck Canada Inc. and H. Lundbeck A/S
conceded in their written arguments that most of the items claimed were not in
dispute. On the questioned disbursements they claim that despite a specific
request made to the appellant’s counsel, they were not provided with the
necessary documentation to support the bill of costs.
[8]
Rule
1(4) of Tariff B states that “No disbursements, others than fees paid to the
Registry, shall be assessed or allowed under this Tariff unless it is
reasonable and it is established by affidavit or by the solicitor appearing on
the assessment that the disbursement was made or is payable to the party.” The succinct
affidavit in support of the bill of costs does not fully substantiate all costs
incurred in this case and provides less than absolute proof. In Abbott
Laboratories v. Canada (Minister of Health) 2008 FC 693,
Senior Assessment Officer Stinson stated:
However, that is not to suggest that
litigants can get by without any evidence by relying on the discretion and
experience of the assessment officer. The proof here was less than
absolute, but I think there is sufficient material in the respective records of
the Federal Court and the Federal Court of Appeal for me to gauge the effort
and associated costs required to reasonably and adequately litigate Apotex’s
position. A lack of details makes it difficult to confirm whether the most
efficient approach was indeed used or that there were no errors in
instructions, as for example occurred in Halford, requiring remedial work. A
paucity of evidence for the circumstances underlying each expenditure make it
difficult for the respondent on the assessment of costs and the assessment
officer to be satisfied that each expenditure was incurred further to
reasonable necessity. The less that evidence is available, the more that the
assessing party is bound up in the assessment officer’s discretion, the exercise
of which should be conservative, with a view to the sense of austerity which
should pervade costs, to preclude prejudice to the payer of costs. However,
real expenditures are needed to advance litigation: a result of zero dollars at
assessment would be absurd.
Having regard to the above, it is now left
to me to establish reasonableness and necessity on all challenged disbursements
on the face of the evidence on file.
[9]
The
appellant claims $6,318.25 for photocopies. They submit that the volume of
photocopies significantly increased with the issues raised in the cross-appeal
and their responsibility to prepare the multi-volume joint book of authorities.
The respondents submit that the volume of photocopies is in part attributable
to the appellant and that the photocopying costs at the rate of $0.25 per page
are not supported by any evidence of actual costs. In support, they refer to
the decision of the Court in Janssen-Ortho Inc. v. Novopharm Ltd. 2006
FC 1333 in which Mr. Justice Hughes stated:
Photocopying
is allowed, where indicated in these Reasons, at the lesser of the actual
charge or $0.25 per page. I am mindful that law firms may have set up in-house
copy centres, possibly as separate entities. In this regard, the comments of
this Court in Diversified Products Corp. v. Tye-Sil Corp., [1990] F.C.J. No. 1056 (QL) are appropriate in stating that the sum of $0.25 per
page is not simply an amount that can be charged without more. When an in-house
service is used, the assessment officer must be advised as to the actual costs.
The Court said:
1. With
respect, I cannot agree with the reasoning of the Taxing Officer. The item of
photocopies is an allowable disbursement only if it is essential to the conduct
of the action. Therefore, this is intended to reimburse a party for the actual
out-of-pocket cost of the photocopy. The $0.25 charge by the office of
Plaintiffs' counsel is an arbitrary charge and does not reflect the actual cost
of the photocopy. A law office is not in the business of making a profit on its
photocopy equipment. It must charge the actual cost and the party claiming such
disbursements has the burden to satisfy the Taxing Officer as to the actual
cost of the essential photocopies.
I
do not dispute that photocopy costs were essential to the conduct of this
matter but with the exception of the concise appellant’s affidavit, the only
evidence supporting the claim for photocopies is found in the Court file. I am
not convinced that all of the photocopies claimed by the appellant were
essential to the conduct of this matter. It is obvious that actual photocopy
expenses were necessary. I have examined the material in the Court file and in
light of the jurisprudence mentioned above and my calculations, I have reduced
the amount claimed to $3,460.00 as a reasonable disbursement for photocopy
expenses and all associated costs applicable to photocopies.
[10]
The
respondents submit that the facsimiles claim of $30.74 be denied based on the
arguments made with regard to the photocopy claim. Considering the established
fact that counsel for the appellant was located in Toronto and counsel for the
respondents in Montreal, it is most likely that facsimile charges were
incurred, to either share material between the parties or file documents with
the Court. That said, I am not convinced that all material faxed was associated
with proceedings for which costs have been awarded. Considering the vagueness
of the evidence on this disbursement, I allow $20.00.
[11]
The respondents submit that the disbursement claimed for
file retrieval should not be allowed. They argue that they cannot be held
responsible for the appellant’s lack of space on-site to keep the material of
the case. I do not consider file retrieval an assessable cost since this
expense was not critical to the outcome of this matter. Although, this expense
is specifically attributable to a particular client, it is for the convenience
of its solicitor of record and is therefore disallowed.
[12]
The
appellant claims $1,287.38 in computer searches to prepare for the appeal and
cross-appeal. It was submitted that this was necessary to address all
developments of the law on the numerous issues raised by this matter. With
regard to the Joint Book of authorities prepared by the appellant, the
respondents submit that all the electronic versions of the case law to be
included on their behalf were submitted electronically. Consequently, Apotex
did not have to incur any costs with respect to the respondents’ authorities
and as such, should not be allowed to claim them.
Apotex did not submit any details to assist
in determining the relevance and reasonableness of the computer time charges. On
this issue, I share my colleague’s views in Englander v. Telus
Communications Inc. 2004 FC 276:
A result of nil dollars at
assessment would be absurd given that I think the Respondent's counsel had an
obligation to carry out research for the assistance of the Court in resolution
of the issues. However, the Applicant is not obligated to pay for the costs of
irrelevant research.
I have had the opportunity to examine the
authorities submitted to the Court. Other than the number of cases submitted in
the Joint Book of authorities, not much relevant information can be retrieved
from Mr. Lederman’s affidavit and the written submissions on this matter.
Considering the involvement of the respondents in the preparation of the Joint
Book of authorities and the paucity of information, I am not clear on the
relevancy or the specific amount of research done. Therefore, I allow the reduced
amount of $750.00 for computer searches.
[13]
The
disbursements claimed for the deliveries/courier ($185.94), the Court fees ($50.00),
the process server/agent fees ($363.50) as substantiated in counsel’s
representations, were all charges necessary to the conduct of this matter, are
not contested and will therefore be allowed.
[14]
The
Bill of Costs is allowed at $6,293.44 plus GST ($314.67) for a total amount of
$6608.11.
“Johanne Parent”
Toronto, Ontario
April 27, 2009
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