Moss (Bankrupt), Re, (2011) 265 Man.R.(2d) 84 (QB)

JudgeClearwater, J.
CourtCourt of Queen's Bench of Manitoba (Canada)
Case DateMay 19, 2011
JurisdictionManitoba
Citations(2011), 265 Man.R.(2d) 84 (QB);2011 MBQB 110

Moss (Bankrupt), Re (2011), 265 Man.R.(2d) 84 (QB)

MLB headnote and full text

Temp. Cite: [2011] Man.R.(2d) TBEd. JN.004

In The Matter Of: The Estate of Danny Moss, A Bankrupt

Keith G. Collins Ltd., as Trustee of the Estate of Danny Moss, a Bankrupt (plaintiff) v. Danny Moss and Carrie Moss (defendants)

(BK 97-01-49147)

Carrie Moss (plaintiff) v. BMO Nesbitt Burns Inc. (defendant)

(CI 00-01-17835)

(2011 MBQB 110)

Indexed As: Moss (Bankrupt), Re

Manitoba Court of Queen's Bench

Winnipeg Centre

Clearwater, J.

May 19, 2011.

Summary:

These two actions were heard together pursuant to an order. The Court of Appeal granted judgment against Danny Moss and Carrie Moss, in favour of the Trustee in bankruptcy and BMO Nesbitt Burns Inc., together with costs on the appeals and at trial. The Court of Appeal taxed and allowed costs on the appeals on a party-and-party basis. An application to the Supreme Court of Canada for leave to appeal the judgment was dismissed. The assessment of trial costs proceeded.

The Manitoba Court of Queen's Bench concluded that Danny Moss and Carrie Moss were jointly and severally liable to the Trustee for party-and-party costs (which included an assessment of double costs subsequent to the service of the offer to settle) in the all inclusive amount of $200,000; and that Carrie Moss was liable to BMO Nesbitt Burns Inc. for party-and-party costs, all inclusive, of $86,000.

Practice - Topic 7082

Costs - Party and party costs - Witness fees and costs of preparation for trial - Witnesses - Preparation - These two actions were heard together pursuant to an order - Judgment was granted on appeal in favour of the Trustee in bankruptcy and in favour of BMO Nesbitt Burns Inc. - The assessment of trial costs proceeded (party-and-party costs) - The Trustee and BMO requested significant increases for preparatory costs (tariff item 3(2)(k)) - BMO sought to increase the $1,000 set for preparation (allowed for trials of up to three days) to $60,000 for the 16-day trial - Its actual trial preparation costs exceeded $90,000 - The Manitoba Court of Queen's Bench agreed that the prescribed tariff allowance was not adequate in this case - The unsuccessful parties took no steps which could have avoided duplication - Their inconsistent pleadings and evidence necessitated an extra amount of preparation - However, it was not possible, on the evidence, to quantify either the time or the value of some of the services which were duplicated - The court concluded that $60,000 for preparation in the BMO action on a party-and-party basis would be oppressive - See paragraphs 28 to 31.

Practice - Topic 7109

Costs - Party and party costs - Special orders - Discretion to exceed scale of costs (incl. power to award percentage of actual costs) - [See Practice - Topic 7082 ].

Practice - Topic 7243

Costs - Party and party costs - Offers to settle - Effect of failure to accept - These two actions were heard together pursuant to an order - The declaratory relief sought by the Trustee in bankruptcy and by BMO Nesbitt Burns Inc. was granted on appeal - The court granted judgment in favor of the Trustee against the unsuccessful parties, jointly and severally, in the amount of $701,133.36 plus interest - The Trustee had served a formal offer to settle, whereby it offered to settle its action any time prior to trial for $270,000 - The assessment of trial costs proceeded - The Manitoba Court of Queen's Bench concluded that the Trustee was entitled to "double costs" as a result of serving the offer to settle prior to trial - Having regard to the amount of the Trustee's claim (over $1 million with interest), the complexity of the issues (factually and legally), and together with the length and costs of a trial, the Trustee's offer to settle was very reasonable - Settling the Trustee's claim pursuant to the offer would not have prejudiced the right of the unsuccessful parties to continue the trial of BMO's issues if they had so elected - See paragraph 23.

Practice - Topic 7246

Costs - Party and party costs - Offers to settle - Whether judgment equal to or more favourable than offer - [See Practice - Topic 7243 ].

Cases Noticed:

North American Life Assurance Co. v. Pitblado & Hoskin et al. (2008), 224 Man.R.(2d) 129; 2008 MBQB 11, revd. in part (2009), 245 Man.R.(2d) 111; 466 W.A.C. 111; 2009 MBCA 83, leave to appeal dismissed (2010), 406 N.R. 395 (S.C.C.), appld. [para. 13].

Manufacturers Life Insurance Co. v. Pitblado & Hoskin, et al. - see North American Life Assurance Co. v. Pitblado & Hoskin et al.

Apotex Fermentation Inc. et al. v. Novopharm Ltd. et al., [1997] 6 W.W.R. 88; 116 Man.R.(2d) 216 (Q.B.), consd. [para. 13].

Dinney v. Great-West Life Assurance Co. et al., [2007] Man.R.(2d) Uned. 65; 2007 MBQB 76, consd. [para. 13].

Howael Ventures (1984) Inc. v. Andersen (Arthur) & Co. (1997), 116 Man.R.(2d) 255 (Q.B.), refd to. [para. 22].

Canadian Express Ltd. v. Blair et al. (1991), 53 O.A.C. 397; 6 O.R.(3d) 212; 10 C.P.C.(3d) 141 (Div. Ct.), refd to. [para. 77].

Statutes Noticed:

Court of Queen's Bench Act, S.M. 1988-89, c. 4; C.C.S.M., c. C-280, sect. 96(1) [para. 7].

Queen's Bench Rules (Man.) - see Rules of Court (Man.), Queen's Bench Rules.

Rules of Court (Man.), Queen's Bench Rules, rule 49.10(2), rule 49.11, rule 49.13 [para. 9]; rule 57.01 [para. 8].

Counsel:

R.W. Schwartz and A. Thiessen, for Keith G. Collins Ltd.;

J. Edward (Ted) Crane, for Danny and Carrie Moss;

D.J. Kroft, for BMO Nesbitt Burns Inc.

This costs matter was heard before Clearwater, J., of the Manitoba Court of Queen's Bench, Winnipeg Centre, who delivered the following reasons for judgment on May 19, 2011.

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