3664902 Canada Inc. et al. v. Hudson's Bay Co., (2003) 169 O.A.C. 283 (CA)

• Judge: Doherty, Austin and Gillese, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: February 25, 2003
• Jurisdiction: Ontario
• Citations: (2003), 169 O.A.C. 283 (CA)

3664902 Can. Inc. v. Hudson's Bay Co. (2003), 169 O.A.C. 283 (CA)

MLB headnote and full text

Temp. Cite: [2003] O.A.C. TBEd. MR.053

3664902 Canada Inc. and 174616 Canada Inc. (plaintiffs/appellants) v. Hudson's Bay Company, c.o.b. as "The Bay Department Stores" (defendant/respondent)

(C37686)

Indexed As: 3664902 Canada Inc. et al. v. Hudson's Bay Co.

Ontario Court of Appeal

Doherty, Austin and Gillese, JJ.A.

March 3, 2003.

Summary:

When Eaton's was facing insolvency in 1999, its fur licensee (the plaintiffs) entered into discussions with the Bay about moving their fur salon to the Bay when Eaton's closed. Negotiations proceeded. Later, the Bay decided not to proceed with the proposed move. The plaintiffs sued the Bay for damages for breach of contract or, alternatively, for negligent misrepresentation.

The Ontario Superior Court, in a decision reported at [2002] O.T.C. 1, held that the parties had not reached an enforceable agreement. However, the court awarded the plaintiffs damages for negligent misrepresentation.

The Ontario Superior Court, in reasons for costs reported at [2002] O.T.C. 432, held that the plaintiffs were entitled to fees of $115,500 plus GST, routine disbursements of $8,004.35 plus GST, travel expenses of $3,600 and experts reports of $115,000 inclusive of GST.

The plaintiffs appealed from the finding that the parties had not reached an enforceable agreement. The Bay cross-appealed from the finding of negligent misrepresentation and the damages awarded to the plaintiffs on the negligent misrepresentation claim. The Bay also sought leave to appeal from the judgment on costs.

The Ontario Court of Appeal dismissed the appeal and cross-appeal. The court awarded the Bay leave to appeal from the costs judgment and dismissed the appeal.

Practice - Topic 7131

Costs - Party and party costs - Disbursements - General - The Ontario Court of Appeal stated that both under the party and party costs regime and the newer partial indemnity regime, disbursements, including witness fees, were assessed upon the basis of what was actually spent, reduced if appropriate to what was reasonably spent - The resulting figure was not then further reduced by reason of the fact that the indemnification was on a party and party or partial indemnity basis as opposed to a solicitor and client or substantial indemnity basis - See paragraph 17.

Practice - Topic 7140

Costs - Party and party costs - Disbursements - Cost of reports - The defendant appealed from the award of costs made to the plaintiffs - The appeal was limited to one item, an award of $115,000 for an expert's report - The plaintiffs had claimed $116,726 as the full cost of the report - The defendant argued that as the costs award was on a partial indemnity basis by agreement of the parties, the trial judge erred in making an award for the expert's report which constituted virtually full indemnity - The Ontario Court of Appeal dismissed the appeal - Fees for the reports and testimony of experts were to be dealt with as disbursements under Part II of Tariff A and recovery of such fees was not to be treated in the same fashion as counsel fees - There was no basis for a further reduction of the expert's account on the ground that the award of costs under which it was assessed was for partial indemnity only - See paragraphs 8 to 21.

Practice - Topic 7141

Costs - Party and party costs - Disbursements - Cost of expert advice - [See Practice - Topic 7140 ].

Cases Noticed:

Martel Building Ltd. v. Canada, [2000] 2 S.C.R. 860; 262 N.R. 285, refd to. [para. 6].

Pearson v. Inco Ltd., [2002] O.J. No. 3532 (Sup. Ct.), consd. [para. 14].

Counsel:

Robert J. Morris, for the appellants;

Bonnie A. Tough and Jason Squire, for the respondent.

These appeals and cross-appeal were heard on February 25, 2003, before Doherty, Austin and Gillese, JJ.A., of the Ontario Court of Appeal. The following judgment of the Court of Appeal was released on March 3, 2003.