Inter-Leasing, Inc. v. Ontario (Revenue)
Costs were awarded to the appellant but reduced from the amounts claimed; the court held costs should follow the event, declined to grant an enhanced award for the settlement offer because the respondent had a duty to protect the public purse and other cases depended on the outcome, and fixed total costs,...
Source-derived case information.
- Citation
- 2014 ONCA 683
- Parties
- Appellant: Inter-Leasing, Inc.; Respondent: The Minister of Revenue
- Court
- Court of Appeal for Ontario
- Jurisdiction
- Canada
- Judgment Date
- 3 October 2014
- Procedural Posture
- Tax Appeal / Costs Endorsement After Appeal
- Outcome
- Appeal allowed on costs; costs awarded to appellant
- Legal Topics
- Costs Awards, Rule 49 Offers, Partial Indemnity Rates, Public Interest in Tax Collection
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Inter-Leasing, Inc.
Appellant
The Minister of Revenue
Respondent
Procedural Posture
Tax Appeal / Costs Endorsement After Appeal
Legal Issues
- 1 Whether costs should follow the event and in what amount
- 2 Whether the claimed costs were excessive
- 3 Whether a settlement offer that did not qualify under Rule 49 justified an increased costs award
Ratio Decidendi
Costs were awarded to the appellant but reduced from the amounts claimed; the court held costs should follow the event, declined to grant an enhanced award for the settlement offer because the respondent had a duty to protect the public purse and other cases depended on the outcome, and fixed total costs, disbursements and HST at $925,000 after assessing reasonableness and proportionality.
Court Disposition
Appeal allowed on costs; costs awarded to appellant
Orders
- Costs of the trial and the appeal, including disbursements and HST, in the total amount of $925,000 awarded to the appellant
Full Case Text
Judgment text and source record
1 paragraphs
Inter-Leasing, Inc. v. Ontario (Revenue) Collection Decisions of the Court of Appeal Date 2014-10-03 Neutral citation 2014 ONCA 683 Docket numbers C57387 Judges Weiler, Karen Merle Magnuson; Hourigan, C. William; Pardu, Gladys I. Subject Civil Decision Content COURT OF APPEAL FOR ONTARIO CITATION: Inter-Leasing, Inc. v. Ontario (Revenue), 2014 ONCA 683 DATE: 20141003 DOCKET: C57387 Weiler, Hourigan and Pardu JJ.A. BETWEEN Inter-Leasing, Inc. Appellant and The Minister of Revenue Respondent In the Matter of the Corporations Tax Act, R.S.O. 1990, c. 40, as amended Al Meghji, Monica Biringer, Caroline D’Elia and Adam Hirsh, for the appellant Anita C. Veiga and Ryan Mak, for the respondent Heard: May 13, 2014 On appeal from the judgment of Justice David Aston of the Superior Court of Justice dated June 26, 2013, with reasons reported at 2013 ONSC 2927. COSTS ENDORSEMENT [1] Inter-Leasing was successful on appeal, and seeks costs of the trial and the appeal in the amounts of $1,068,199.14 and $251,711.44 respectively. [2] The respondent agrees that costs should follow the event, but asserts that the amounts claimed are excessive. [3] This was a complex case, in some respects a test case. The amounts in issue were substantial, amounting to $36,000,000 in taxes and $19,000,000 in arrears interest. There was extensive documentary production, and four days of pretrial examination before the trial which lasted about six days. Both parties were granted leave to file 45 page facta on the appeal. [4] Inter-leasing offered to settle for an amount more generous to the respondent than the outcome of the appeal. For this reason it submits that while the offer did not qualify as a Rule 49 offer, it should get a costs “bump up” of 25% after the offer. While this might be appropriate in other contexts, here the respondent had an obligation to protect the public purse, and other cases depended on this one. There was no improper conduct by the respondent which would justify increased costs. [5] I agree with the appellant that the cost rates set out in the Information for the Profession set out in the preamble to Rule 57 of the Rules of Civil Procedure are now out of date, and that amounts calculated at 55%-60% of a reasonable actual rate might more appropriately reflect partial indemnity, particularly in the context of two sophisticated litigants well aware of the stakes. [6] Even in this context, the amounts claimed exceed a fair and reasonable amount that these litigants would expect to pay or be awarded. [7] In the end, balancing the above factors, I award costs of the appeal and the trial to the appellant, including disbursements and HST in the total amount of $925,000. “K.M. Weiler J.A.” “C.W. Hourigan J.A.” “G. Pardu J.A.”