Date: 19980209
Docket: T-513-94
BETWEEN:
UNIWELL CORPORATION
Applicant
- and -
UNIWELL NORTH AMERICA INC.
Respondent
TAXATION OF COSTS - REASONS
G.M. SMITH, TAXING OFFICER
[1] These proceedings were commenced by way of an Originating Notice of Motion filed on March 9, 1994 seeking an order expunging Uniwell North America Inc.'s trade mark UNIWELL registration no. TMA 373,978. On March 13, 1996, the Court signed an Order striking out the registration in question. The Court also awarded costs to the applicant. This is the taxation of those costs.
[2] On September 8, 1997, the applicant filed a Bill of Costs appended to the affidavit of John Craig sworn on September 4, 1997. The applicant requested that the taxation proceed by way of written representations, without the personal appearance of the parties.
[3] On October 31, 1997, I gave the respondent until November 14, 1997 to file representations in reply to the Bill of Costs. The applicant was given until November 26, 1997 to file representations in rebuttal. The applicant later consented to a request from the respondent to extend those periods. Representations were eventually received from both parties, including an affidavit of Victoria Carrington filed by the respondent. The affiant John Craig was also cross-examined on his affidavit on December 3, 1997. A transcript of that cross-examination was filed on December 11, 1997.
[4] The Bill of Costs submitted by the applicant included the hours of its counsel as an exponential factor against the units claimed for each of the services listed. The respondent argued that this is a party-and-party taxation which must be assessed under Tariff B, Part II, rather than the more generous solicitor-and-client scale which appeared to be the path the applicant was taking by including hours for all its services. The respondent pointed out that Tariff B excludes hours as a factor for computing fees, with the exception of course of those items in Part II which specifically provide "per hour", such as appearance at hearings. And in particular reference to attendance at hearings, the respondent further argued that the number of hours which were claimed by the applicant was exorbitant against the time shown on the Court record for counsel's actual appearance.
[5] The respondent also opposed the affidavit of John Craig, filed in support of the applicant's Bill, because it was not based on "personal knowledge" as required by Rule 332(1). And finally, the respondent argued that money was owed the respondent, by the applicant, for appearance on a motion filed by the applicant and for conduct of a witness, and those costs should now be deducted from the applicant's Bill.
[6] As to the evidence of John Craig, the applicant replied that the Bill had been drafted with the supervision of counsel for the applicant who himself had personal knowledge of the litigation. In any event, counsel contended, Rule 332(1) provides for evidence on information and belief in interlocutory circumstances, such as the event of a taxation of costs. As for the issue of hours, the applicant admitted that the affiant had inadvertently lumped together preparation time with attendance. And lastly, as to the matter of funds owed the respondent, counsel for the applicant countered that this issue is irrelevant to the taxation at hand, being an assessment of the applicant's costs, not the respondent's. And in any event, the applicant submitted, the amounts allegedly owed must be weighed against the respondent's own refusal to pay funds it apparently owes the applicant for costs incurred at the appellate level of this Court.
[7] The respondent is quite correct in its categorization of this taxation as being on party-and-party scale. In accordance with Rule 346(1), the fees which can be assessed to the applicant are prescribed by the schedule of items in Column III, Part II of Tariff B. The number of "hours" expended by counsel, other than assisting in the application of Rule 346(1.1) criteria, can only be a factor for those services which, as mentioned above, specifically state "per hour".
[8] As to the Craig affidavit, I accept the applicant's view that it is suitably framed for these circumstances. A taxation of costs is not a step which determines any substantive rights of the parties, but rather merely enables the applicant to come to this Court to have the substantive rights of its costs assessed. I agree with the view of my fellow taxing officer Cousineau in Nekoosa Packaging Corporation v. AMCA International Ltd. [1991] F.C.J. No. 1145 (Fed. T.D.) that a taxation of costs is interlocutory in nature. A taxation is also a quasi-judicial process, which further diminishes the requirement for evidence in the more restrictive context of personal knowledge. I am satisfied with the affiant's explanation of the source and grounds of his information, having drafted his affidavit under the supervision of the counsel for the applicant who had actually worked on the file. I have found no reason to question either the affiant's belief or the reliability of the information provided.
[9] As to amounts allegedly owed the respondent, I agree as well with the applicant that this is an issue outside the parameters of my role in assessing the costs awarded the applicant. The respondent can file its own Bill of Costs if it wishes to have those awarded it by the Court assessed in accordance with the Rules of this Court.
[10] I turn now to the services claimed by the applicant and to the criteria prescribed in Rule 346(1.1). This litigation was certainly not devoid of procedural twists; five interlocutory motions arose during the course of the proceedings which extended over a period of two years. I also appreciate that this case was of significant commercial interest to the applicant and that considerable work appears to have been invested. Having said that, however, and on reviewing the proceedings, I find this case to have been neither exceptionally complex nor, on the other hand, utterly simple. It proceeded at a mildly protracted rate but without an unusually high volume of work. I have taken this view in applying the criteria of Rule 346(1.1) to the assessment of the services claimed by the applicant.
[11] I will allow the maximum 7 units permissible under item 1 of the Tariff for the total of services for preparation of the originating Notice of Motion and the applicant's Record. The applicant's claim of 7 units for preparation of a joint application for time and place for hearing will be reduced to the 1 unit which is allowable under item 20 of the Tariff.
[12] A total of 10 units are claimed under items 5 and 6 relating to cross-examination of the respondent; 7 units for preparation and 3 units for attendance. I will allow 4 units for preparation under item 8 and 2 units for attendance, multiplied by 1.25 hours, in accordance with item 9 of the Tariff.
[13] The applicant also claims under items 5 and 6 for services relating to the respondent's motion for extension of time. The claim under item 5 must be taxed-off because it was the respondent's rather than the applicant's motion. I will allow 2 units under item 6, however, multiplied by 1 hour, for appearance on that motion.
[14] The costs claimed for services relating to the applicant's motion for cross-examination of respondent's witness must also be refused. In accordance with Rule 344, the authority for awarding costs rests squarely with the Court, not the taxing officer. The Court's Order dismissed that application with costs. I am therefore without the requisite discretion to allow costs contrary to the Court's finding.
[15] I have refused as well the applicant's claims for services relating to the respondent's motion to file a reply affidavit. The provisions of Rule 346 come into play again here. In disposing of this application, the Court's Order was silent on the matter of costs. I cannot now usurp an authority to assess costs which the Court itself had quite clearly refrained from awarding to the applicant.
[16] A total of 20 units have been claimed by the applicant under item 5 with respect to preparation of the applicant's motion to file a reply affidavit. An additional 3 units are claimed for 3 hours of appearance on the motion. The Court file recorded the hearing as having lasted just over 1 hour. I have therefore reduced the claim for preparation to 5 units and will allow 2 units for appearance on the motion, multiplied by 2 hours, under item 6.
[17] As for services relating to the motion to cross-examine the applicant's witness, the claim for preparation under item 5 will be taxed-off because this was the respondent's motion, not the applicant's. The Court file recorded this hearing as well as having lasted just over 1 hour. The applicant's claim under item 6 for appearance will therefore be reduced to 2 units, multiplied again by 2 hours.
[18] The applicant presented claims as well under items 15 and 14, respectively, for preparation of a Statement of Facts and Law and for attendance at the hearing. I will allow the maximum of 5 units for preparation under item 15 and 3 units, multiplied by 3 hours of attendance, under item 14(a).
[19] As for the disbursements claimed by the applicant, the following were agreed by the respondent and will therefore be allowed: Printing House - $221.18 for photocopies and binding; Tupper & Adams - $325.88 for corporate searches; and Gillespie Reporting Services - $312.50 for examination and transcripts.
[20] The Court file shows that only $150.00 was paid for filing fees. The claim of $230.00 must therefore be reduced accordingly. I am satisfied from the invoices and excerpts from the firm's ledger that the claims of $185.08 and $2.03 for Quicklaw and Infomart, respectively, were reasonable and necessary.
[21] The claim of $1,779.86 for in-house photocopies and binding is disallowed, however, for reasons similar to those I expressed recently in Taylor Made Golf Company, Inc. v. Sully Imports Ltd., unreported, Court file no. T-2637-96, dated October 23, 1997, in reference to an earlier taxation in F-C Research Institute Ltd. v. H.M.Q., also unreported, Court file no. T-2338-87, September 21, 1995. The evidence filed in support of the costs claimed for in-house photocopies and binding is patently insufficient. No substantiation is shown whatsoever of the cost to the law firm for those services. To allow these costs on the basis of the very thin evidence produced by the applicant would place me in the untenable position of having to certify that the respondent should be held accountable for some arbitrary amount.
[22] I find support for this view in the unreported decision of this Court in Faulding (Canada) Inc. v. Pharmacia S.P.A., Court file no. T-421-97, dated November 4, 1997, where Mr. Justice McKeown recently stated:
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Notwithstanding the recent Rule changes which are intended to bring costs more in line with actual costs of litigation, I agree with the plaintiff that many of the disbursements are calculated on a scale more appropriate on a solicitor/client bill than on a party and party bill. For example, with respect to photocopying, as Teitelbaum, J. said in Diversified Products Corp. v. Tye-Sil Corp. (1990), 34 C.P.R. (3d) 267 (F.C.T.D.) at 276: |
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... 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 ... |
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The defendant provided me with no information on the actual out-of- pocket cost of the photocopying and I have allowed nothing in this respect. I am also unable to calculate the out-of-pocket cost of facsimile transmission charges. |
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[23] Accordingly, the applicant's Bill of Costs is assessed in the amounts of $4,350 for services and $1,196.67 for disbursements. A Certificate of Taxation will issue for the total amount of $5,546.67.
"Gregory M. Smith"
Gregory M. Smith
Taxing Officer
Ottawa, Ontario
February 9, 1998
FEDERAL COURT OF CANADA
TRIAL DIVISION
NAMES OF SOLICITORS AND SOLICITORS OF RECORD
COURT FILE NO.: T-513-94
BETWEEN:
Applicant
| UNIWELL NORTH AMERICA INC. |
TAXATION IN WRITING WITHOUT PERSONAL APPEARANCE OF PARTIES
TAXATION OF COSTS - REASONS BY G. SMITH, TAXING OFFICER
DATE OF REASONS: February 9, 1998
APPEARANCES:
| Mirco Bibic for the Applicant |
Adele J. Finlayson for the Respondent
SOLICITORS OF RECORD:
STIKEMAN, ELLIOTT
Barristers & Solicitors
Ottawa, Ontario for the Applicant
SHAPIRO, COHEN
Barristers & Solicitors
| Montreal, Quebec for the Respondent |
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