Judgments

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T-2994-72
Crelinsten Fruit Company and William D. Bran- son Limited (Plaintiffs)
v.
Maritime Fruit Carriers Co. Ltd. (Defendant)
Trial Division, Walsh J.—Montreal, January 12; Ottawa, January 27, 1976.
Practice—Costs—Application to review and set aside taxa- tion—Cargo of fruit shipped from Australia to Montreal spoiling—Evidence involving tracing of methods of picking, packing, shipping, etc.—Substantial and difficult issues involved—Federal Court Rules 3(c), 337(5), 344(4),(7), 346(2), Tariff A, s. 4(2), B, ss. 2(a),(b), 3.
A cargo of fruit shipped from Australia to Montreal spoiled, and became unmarketable at an earlier date than should have been anticipated. The evidence involved tracing the methods of picking, packing and shipping the fruit, detailed evidence as to method of delivery, etc., and comparative evidence as to condi tion of fruit shipped on the same and similar vessels to the New York market. Judgment was rendered for plaintiff for $89,352. There was no discussion of costs, nor any request for a special order. An amended judgment was issued, and by the time a motion was made for taxation of plaintiffs' bill of costs, it was too late for plaintiffs to apply for an amendment to the judgment under Rule 337(5) to seek a special direction by virtue of Rule 344(7). Defendant applies to review and set aside certain parts of the party and party bill of costs as taxed.
Held, the bill of costs is reduced to $24,845.17. The scheme of the Rules taken as a whole requires that, in the event of a departure from the sums set out in the Tariff, it is the Court which should have the discretion to decide. Whether permission to increase the Tariff amounts is given on pronouncement of the judgment, as a result of a subsequent amendment of this pronouncement, or whether on appeal from a taxation by the Registrar, the Rules and justice require that the judge may exercise his discretion in a proper case. Substantial and difficult issues were involved, and it is proper that amounts should be allowed to experts and counsel over and above standard Tariff amounts.
Crabbe v. Minister of Transport [19731 F.C. 1091, distin guished. Aladdin Industries Inc. v. Canadian Thermos Products Ltd. [1973] F.C. 942 and National Capital Commission v. Bourque [1972] F.C. 519, applied.
APPLICATION. COUNSEL:
Y. Bolduc for plaintiffs. T. Bishop for defendant.
SOLICITORS:
Robinson, Sheppard, Borenstein, Shapiro & Flam, Montreal, for plaintiffs.
Brisset, Bishop & Davidson, Montreal, for defendant.
The following are the reasons for judgment rendered in English by
WALSH J.: This is an application by defendant to review and set aside certain parts of the party and party bill of costs taxed by L. Joseph Daoust, District Administrator in Montreal on December 9th, 1975. At the conclusion of the hearing no discussion took place with respect to costs nor was any request made for a special order concerning them. The judgment was merely rendered in favour of plaintiff for $89,352 with costs. Subse quently, an amended judgment was issued to include interest at 5% from September 22nd, 1969, this being another matter which had not been dealt with in the original judgment. By the time a motion was made on December 9th, 1975 for taxation of plaintiffs' bill of costs it was already far too late for plaintiff to apply for an amendment to the judgment under Rule 337(5) in order to seek from the Court a special direction with respect to costs by virtue of Rule 344(7).
Tariff A, Section 4(2) states:
4. (2) In lieu of making a payment under section 3 1 , there may be paid to a witness who appears to give evidence as an expert a reasonable payment for the services performed by the witness in preparing himself to give evidence and giving evidence.
Tariff B, Section 2(2)(a) states:
2. (2) ...
(a) All disbursements made under Tariff A may be allowed, except that payments to a witness under paragraph 4(2) may only be allowed to the extent directed by the Court under Rule 344(7),
Furthermore, Tariff B, Section 3, states:
3. No amounts other than those set out above shall be allowed on a party and party taxation, but any of the above amounts may be increased or decreased by direction of the Court in the judgment for costs under Rule 344(7).
As a result, as pointed out by Chief Justice Jackett, in the case of Crabbe v. Minister of
1 $35 a day.
Transports, in the absence of an application under Rule 344(7) made within the time limited by Rule 337(5), the Court could not, in that case, award a lump sum for costs in place of the costs fixed by the Tariff. The same applies on an appeal from the taxation under Rule 346(2). Page 1093 of the judgment states:
Finally, it is to be noted that the so-called appeal from a taxation is to be found in Rule 346(2), which provides that costs are to be taxed by a taxing officer "subject to review by the Court upon the application of any party dissatisfied with such a taxation". It is obvious that, on such a review, the Court decides whether the taxing officer erred in performing his duty and on such a proceeding it can neither change the Court's judgment or direction nor make a direction or order contem plated by Rule 344(4) or paragraph 3 of Tariff B.
I believe, however, that this case might perhaps be distinguished in that, at page 1093, the judg
ment also states:
In the present case, since the judgment was pronounced in open court, the matter of awarding a fixed amount in lieu of costs to be taxed might have been spoken to before the judg ment was pronounced.
That is not the situation in the present case. Moreover, the application before me does not con sist of a request by plaintiff to increase the costs allowed by the Registrar on taxation but is rather an appeal from this taxation by defendant, seeking to reduce the amounts he awarded. It was at my suggestion that the bill of costs was submitted to him in the first case for taxation, subject to an appeal in the event that the parties did not agree on the amounts awarded. This case therefore close ly resembles that of Aladdin Industries Inc. v. Canadian Thermos Products Ltd. 3 in which Kerr J. stated at page 945:
It may be that I was wrong in suggesting that Thermos have its costs taxed, subject to review by the Court. However, Thermos acted on that suggestion, and I have heard the parties on the merits of the costs and the application to review them. I am convinced that some of the amounts in Tariff B are inadequate to do justice costwise to Thermos in the circum stances of this case, having regard particularly to the great volume of work done in preparation for the trial, and I am mindful of what was said by Collins M.R., in Re Coles and Ravenshear [1907] 1 K.B. I at page 4 as follows:
2 [1973] F.C. 1091.
3 [1973] F.C. 942.
Although I agree that a Court cannot conduct its business without a code of procedure, I think that the relation of rules of practice to the work of justice is intended to be that of handmaid rather than mistress, and the Court ought not to be so far bound and tied by rules, which are after all only intended as general rules of procedure, as to be compelled to do what will cause injustice in the particular case.
Consequently, I will review the taxation and allow amounts above those in Tariff B where I think that increases should be allowed, on the basis that it is appropriate and within my power to do so in the circumstances and that although Rule 344(7) contemplates a direction from the Court within a time that has expired in this case, such time would be extended under Rule 3(1)(c) if the Court considered that such a direction was necessary for allowance of increases in costs in this case.
See also National Capital Commission v. Bourque 4 in which Chief Justice Jackett stated at pages 529-30:
In the Federal Court Rules, we find that paragraph 4(2) of Tariff A provides as follows:
(2) In lieu of making a payment under section 3, there may be paid to a witness who appears to give evidence as an expert a reasonable payment for the services performed by the witness in preparing himself to give evidence and giving evidence.
and that Tariff B, which regulates the amounts that may be allowed in a party and party taxation, provides in paragraph 2(2) as follows:
2. (2) Disbursements
(a) all disbursements made under Tariff A may be allowed, except that payments to a witness under paragraph 4(2) may only be allowed to the extent directed by the Court under Rule 344(7).
(b) such other disbursements may be allowed as were essen tial for the conduct of the action.
(It is true that this provision contemplates a direction from the Court within a time that has expired in this case but we have no doubt that such time would be extended, in the circumstances of this case, under Rule 3(c)).
I believe that the scheme of the Rules taken as a whole requires that in the event of a departure from the sums set out in the Tariff, it is the Court which has the discretion to decide. Whether per mission to increase the Tariff amounts is given on the pronouncement of judgment, as a result of a subsequent amendment of this pronouncement, or whether on an appeal from a taxation by the Registrar, the Rules and justice require that the judge may exercise this discretion in a proper case.
In the present action, a claim of $147,151.54 was involved, arising out of the perishing of a
[ 1 97 2] F.C. 519.
cargo of fruit shipped from Australia to Montreal, which shipment went bad and became unmarke- table both in Montreal and Toronto to a substan tial extent at a much earlier date than should have been anticipated. The evidence involved tracing the methods of picking, packing and shipping the fruit from various growers in Australia to the docks, including the optimum date for picking, details of the manner in which the fruit was packed, construction of the refrigerated ships in which it was transported, and detailed evidence involving the method of delivery of the fruit to cold storage warehouses in Montreal and Toronto and subsequent withdrawal from them for marketing. Comparative evidence was also given as to condi tion and marketability of fruit shipped on the same and other similar vessels to the New York market. The trial in Montreal occupied 10 1 / 2 days, there were 526 pages of discovery of various witnesses and 158 pages of evidence taken on a rogatory commission in New York and 571 pages of such evidence in Australia. 72 exhibits were filed by the plaintiffs and 86 by defendant. Plaintiff called 16 witnesses, including 4 experts and defendant 12, including 2 experts. The judgment was eventually rendered in favour of plaintiffs for $89,352. Obvi ously substantial and difficult issues were involved. Fruit growing and packing experts were brought from Australia, Israel and England to testify and counsel for the parties had to travel to Australia and to New York in connection with the rogatory commissions. It is evident on these facts that it is proper that amounts should be allowed to experts and counsel, over and above the standard amounts fixed in the Tariff. In the Aladdin Industries Inc. case (supra) Kerr J. stated, at pages 948-9:
It is a generally accepted principle that party and party costs are awarded as an indemnity or partial indemnity to the successful litigant against costs reasonably incurred, subject to the express provisions of any applicable statutes and the tariffs and rules of the court concerned.
The amounts provided in section 2 of Tariff B for services of solicitors and counsel are intended to be appropriate in the general run of cases coming before this Court. The amounts may be increased or decreased by direction of the Court, and in exercising its discretion to increase the amounts the Court will, I should think, have due regard to any special circumstances, including the complexity, value and importance to the litigants of the proceedings and the time and work reasonably involved
in the services. In the present case there are such special circumstances, and I think that increased amounts are warrant ed in respect of some of the items. I also think that the amounts in section 2 for the general run of cases may be taken and used as a guide or yardstick in fixing commensurate increases.
This statement of principle was cited with approval in a judgment of Heald J. on December 10th, 1973, in the unreported case of Leithiser v. Pengo Hydra-Pull of Canada Ltd., T-1738-71. At the hearing of the motion to review the taxation in the present case, defendant withdrew his objec tions to taxation of items A, D and E being the professional fees of G. Hall, Seymour Levine and Leo Klein. Plaintiff in turn withdrew the claim under item B of G. Hall for three long distance calls in the amount $32.06. The items remaining in dispute therefore are the following:
C. Harold J. Gates,
professional fee $ 1,225.00
F. Counsel fee for
Martineau, Walker $ 3,874.75
G. Mallesons, Solicitors in Melbourne, related to dealing with expert witness
Hall $ 698.78
H. Mallesons, Solicitors in Melbourne, related to services supplied to Plaintiff
in Australia $11,662.49
With respect to the evidence of the witness Gates, or more specifically the invoice of Superin- tendance Company (Canada) Ltd. by whom he is employed, in the amount of $1,225, this is based on services from March 13th to 15th and April 8th to May 2nd, 1974, including expenses according to the invoice. He testified briefly on one day as an expert witness and his evidence was only of mar ginal significance in connection with the outcome of the case. There was certainly no need for him to remain in attendance throughout the trial which lasted from April 23rd to May 7th. During his testimony he stated that he had read most of the evidence taken at the rogatory commission in Aus- tralia and in New York but this would certainly not involve more than two additional days in preparation for the trial. The other experts were allowed $150 a day and I believe that an allowance of $450 would be sufficient, representing a reduc tion of $775 on the amount of $1,225 claimed.
With respect to the counsel fee for Martineau, Walker, law firm, in the amount of $3,874.75 for
professional services rendered in connection with the action, and including advice, opinions with respect to the law, acting as counsel in the prepa ration and taking of the action, it is stated that this was based on a charge of 21 hours for Mr. Tetley, at $75 an hour and 31 hours for Mr. Cleven at $45 an hour. This only totals $2,970. This law firm commenced the proceedings and carried on throughout the initial stages including the motions for the appointment of rogatory commissioners, before being substituted as attorneys of record by Robinson, Sheppard et al. Defendant does not dispute that the services of Messrs. Martineau, Walker et al. were useful, nor claim that the amount of their account is excessive but points out that all the tariff items to which they would be entitled in connection with the institution of the proceedings and all the preliminary motions have already been covered in the bill of costs and there would be duplication if they were now able to render an account covering at least in part the services so provided. They were not present in Court at trial and did not participate in the con duct of same and any services rendered by them to the attorneys who were substituted for them after the entry of the latter into the record must have been at least partly of an advisory nature. Attor neys of record are taxed in accordance with the tariff in the bill of costs for the preparation for the hearing and the conduct of same as well as for the preliminaries and cannot be compensated on a time-charge basis over and above this so it would not be reasonable if, as a result of a substitution in the record for the original attorneys of record, a claim could be made in addition to all the fees which attorneys of record are allowed for a further sum as a disbursement incurred in the payment of the account of the original attorneys of record. Neither would it appear to be proper to treat learned counsel who are engaged as such by an attorney of record in an advisory capacity, who do not participate in the trial, in the same manner as expert witnesses and consider sums disbursed for these services as a disbursement proper to include in any party and party taxation of the bill of costs. Of the sum of $3,874.75 claimed under this head ing therefore, I believe that only the disbursement of $74.75, which presumably was incurred in the early stages of the action when the Martineau, Walker firm were attorneys of record, should be
allowed and the claim is therefore reduced by $3,800 under this heading.
With respect to the first Mallesons invoice, in the amount of $698.78 (Australian $532.01) this represented $147.01 (Australian) as disbursements and $385 for:
taking your further instructions in this matter, contacting Mr. E. G. Hall in Sydney and arranging to obtain affidavit from him, attending Mr. Hall in Sydney and drafting, engrossing and arranging swearing of affidavit, forwarding same by air freight to Montreal, including incidental attendances etc.
While the affidavit from Mr. Hall was only five pages in length, these services did apparently involve travel by a representative of Mallesons from Melbourne to Sydney, Australia and I do not believe that this account should be reduced.
The second Mallesons account consists of fees of $4,500 (Australian) and various disbursements amounting to $5,300.41 (Australian) making a total of $9,800.41 (Australian) which has been converted to $11,662.49. Counsel for defendant did not seriously object to most of the disburse ments although he queried the item for the expenses and fees of the witness Hall, namely $175.05 (Australian) for coming from Sydney to Melbourne at the time of the rogatory commission, at which he did not testify. He also queried the claim of $967.41 (Australian) for photocopying. Similar disbursements were allowed in the Alad- din case (supra) but disallowed in the Leithiser case, due to absence of proof. On explanation that this photocopying was probably for extra copies of the evidence taken on the rogatory commission, counsel for defendant withdrew his objection. He contended however that Mallesons were not required to be present throughout the 11 days of the rogatory commission in Australia and if they were so, this was of the nature of a luxury and at the request of counsel for plaintiff. Other services rendered by them in Australia were necessary, however and he suggested that one third of their claim should be allowed. I believe this to be insuf ficient and would allow one half $2,250 (Australi- an). The net reduction of this account therefore is $2,250 (Australian). The net reduction of this account therefore is $2,250 (Australian) of the fees and $175.05 of disbursements or a total of
$2,425.05.
Since the original claim of $9,841 (Australian) was converted to $11,662.49 Canadian, this repre sents approximately a 20% increase on exchange. The sum of $2,425.05 (Australian) increases to a sum in round figures of approximately $2,910 Canadian. The four reductions made of $32.06, $775, $3,800 and $2,910 makes a total reduction of $7,517.06 reducing the amount of the bill of costs taxed at $32,362.23 to a balance of $24,845.17 for which I now direct the bill of costs should be taxed.
ORDER
On review of the taxation of the bill of costs herein, same is reduced to $24,845.17, without costs.
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