Date: 20060331
Docket: T-2406-93
Citation: 2006 FC 422
BETWEEN:
JAMES W. HALFORD
and VALE FARMS LTD.
Plaintiffs
- and
SEED HAWK INC., PAT BEAUJOT,
NORBERT BEAUJOT, BRIAN KENT
and SIMPLOT CANADA LIMITED
Defendants
ASSESSMENT OF COSTS - REASONS
Charles E. Stinson
Assessment Officer
TABLE OF CONTENTS
Introduction:................................................................................................................. paras. [1] - [9]
The Seed Hawk Defendants' Overview:.................................................................... paras. [10] - [16]
The Simplot Defendant's Overview:.......................................................................... paras. [17] - [18]
The Plaintiffs' Overview:........................................................................................... paras. [19] - [22]
Invalidity
- The Seed Hawk Defendants:......................................................................... paras. [23] - [30]
- The Simplot Defendant:................................................................................. paras. [31] - [35]
- The Plaintiffs:................................................................................................ paras. [36] - [51]
- Assessment of Invalidity:............................................................................... paras. [52] - [57]
The Seed Hawk Defendants Further Revised Bill of Costs as to Trial
- Clifford J. Anderson:..................................................................................... paras. [58] - [89]
- Pitblado Buchwald Asper:............................................................................. paras. [90] - [92]
- The Scandinavian Witnesses:....................................................................... paras. [93] - [110]
- Dr. Harry Ukrainetz:................................................................................. paras. [111] - [116]
- Dr. Ken Domier:....................................................................................... paras. [117] - [120]
- Counsel Fees:........................................................................................... paras. [121] - [140]
- Norbert and Pat Beaujot:.......................................................................... paras. [141] - [153]
- Transcript:................................................................................................ paras. [154] - [157]
- Law Firms:............................................................................................... paras. [158] - [162]
- Lawyers' Travel:....................................................................................... paras. [163] - [177]
- Paul Beaumont:...................................................................................................... para. [178]
- Research, Searches and Office Materials:.................................................. paras. [179] - [184]
- Norwegian Patent and US Patent:............................................................. paras. [185] - [187]
- Book Loan etc.:........................................................................................ paras. [188] - [189]
The Simplot Defendant's Bill of Costs as to Trial
- Counsel Fees:........................................................................................... paras. [190] - [212]
- Disbursements:.......................................................................................... paras. [213] - [241]
The Bills of Costs of the Seed Hawk Defendants
and the Simplot Defendant as to the Costs Decision:........................................... paras. [242] - [249]
The Plaintiffs' Bill of Costs:................................................................................................. para. [250]
- October 31, 2000 Order:.......................................................................... paras. [251] - [256]
- Costs Thrown Away Decision:.................................................................. paras. [257] - [280]
- James Halford Cross-examination:............................................................. paras. [281] - [287]
- the Reconsideration Decision:.................................................................... paras. [288] - [291]
The Three Bills of Costs as to Assessment of Costs:.............................................. paras. [292] - [298]
Interest:.............................................................................................................................. para. [299]
Set-off:................................................................................................................. paras. [300] - [306]
Introduction
[1] The trial of this matter, addressing allegations of patent infringement relative to an invention described as a "Seed/Fertilizer Placement System for Minimum Tillage Application", occurred over a period of four years. The Court dismissed the main action, with costs to be spoken to by notice of motion, and dismissed the counterclaim but did not mention costs. Subsequently, the Court issued directions concerning the assessment of the Defendants' costs and, as well, denied costs to the Plaintiffs relative to defence of the counterclaim. However, the Court confirmed that the Plaintiffs could assess their costs awarded in any event of the cause further to interlocutory proceedings. The Court directed that these assessments of costs could proceed notwithstanding outstanding appeals against the trial judgment.
[2] I comment further to para. [14] of my decision in this matter on venue for an assessment of costs, reported at Halford v. Seed Hawk Inc., [2005] F.C.J. No. 600. Ordinarily requiring as I do that assessments of costs proceed orally (they are addressed in writing in many instances) on affidavit evidence supported by argument, my practice has been to not engage a verbatim reporter. If counsel avail themselves of Tariff B1(4) to explain and clarify ad hoc oversights in the affidavit evidence, I do not adjourn the proceeding to bring in a verbatim reporter, but simply record said late evidence as best I can in my reasons. In some jurisdictions, although an oral hearing of an assessment of costs proceeds on affidavit evidence and argument, the presiding officer informs both sides that a machine in the hearing room will be used to record the oral submissions as an aid to the assessment officer in recollection and that its recorded contents will become part of the record. I think that the broad parameters of Rule 408(1), ie. "... assessment officer may ... give directions for the conduct of an assessment", would have permitted such an approach here. This is all simply to note that I decided that the circumstances here warranted the use of a verbatim reporter. The Court's directions for the assessment of costs required 37 pages. The summaries in these reasons of the parties' respective positions should be detailed enough for an understanding of the notion of issues between the parties, but should be read keeping in mind that there are many more nuances and details of those issues in the voluminous record of documents and transcripts, all of which I have read and considered. I have not attempted to include in these reasons some part of every detail in the materials.
[3] These reasons address assessments of eight bills of costs. The Defendants, Seed Hawk Inc., Pat Beaujot, Norbert Beaujot and Brian Kent (hereafter the "Seed Hawk Defendants") presented three bills of costs claiming $713,566.26, $10,545.80 and $5,761.20 respectively, plus GST and PST as applicable. The Defendant, Simplot Canada Limited (hereafter the "Simplot Defendant"), presented three bills of costs claiming $272,328.65, $9,007.27 and $6,907.33 respectively, plus GST and PST as applicable. The Plaintiffs presented two bills of costs claiming $84,978.46 and $3,425.00 respectively, plus GST and PST as applicable. These assessments, heard one after the other, spanned eight days in Calgary and Winnipeg. Counsel were tenacious in their advocacy for their respective clients. Their organization of materials and submissions and their general civility combined to make the best use of that time. I note simply from my reading of the record that the tariff parameters of partial indemnity for litigation costs mean that the amounts in the various bills of costs do not begin to approach the actual legal costs incurred by all parties to this litigation.
[4] Throughout the hearing of these assessments of costs, there were objections about counsel straying into the giving of evidence or beyond the ordinary scope of reply or rebuttal. Counsel were firm in their respective positions on such issues. I attempted to address these concerns as they arose within two general parameters of practice relative to perfection of the record before me. The first was my awareness of the Court's conclusion in Amfac Foods Inc. v. Irving Pulp & Paper Ltd., [1985] F.C.J. No. 1150 (F.C.T.D.) that a review of an assessment of costs ought to be limited to the record before the assessment officer. The second was my sense that, although an assessment of litigation costs necessarily has a number of formal features, ie. notice, evidence, argument, right of appeal etc., it occurs at a late stage of the litigation and should, to promote some finality in the proceedings, involve some give and take in the argument to crystallize and resolve specific dollar amounts thereby putting an end to the matter.
[5] The first portion of the trial (hereafter the "1st Trial Portion in 2000") occupied November 6 to 9, 2000, inclusive. Unfortunate circumstances, described in more detail below, precluded the attendance at trial on November 9 by counsel for the Seed Hawk Defendants. The second portion of the trial (hereafter "the 2nd Trial Portion in 2001"), by which time the Seed Hawk Defendants had replaced their initial solicitor of record with a new and current solicitor of record, occupied October 15 and 16, 22 to 26 inclusive, 29 to 31 inclusive and November 1 and 2, 2001. The third portion of the trial (hereafter the "3rd Trial Portion in 2002") occupied June 17 to 21 and 24 to 28, 2002, both inclusive. The fourth portion of the trial (hereafter the "4th Trial Portion in 2003") occupied February 3 to 7 and 10 to 14, 2003, both inclusive.
[6] The Reasons for Order and Order of the Honourable Mr. Justice Pelletier dated January 23, 2004 (hereafter the "Trial Decision") concluded at para. [260] that the Seed Hawk Defendants' device did not infringe the patent. Paragraph [261] of the Trial Decision noted that the Seed Hawk Defendants had raised a number of grounds of invalidity of the claims of the patent both as a defence to the claims of infringement and as a counterclaim to the infringement claim. The Court considered each ground in turn and concluded at para. [316] that "the Seed Hawk defendants have either failed to establish invalidity or have failed to plead the grounds of invalidity which they could prove." The Court noted at para. [317] that the finding of non-infringement rendered moot the need to assess the personal liability of Pat Beaujot, Norbert Beaujot and Brian Kent, but should said finding be an error, the Court would in a somewhat summary fashion consider this as an issue in the alternative. At para. [339], the Court found against personal liability. As well, at para. [340], the Court noted that, given its finding of non-infringement, it was not necessary to consider the issue of whether the Simplot Defendant had abetted or induced infringement by the Seed Hawk Defendants. However, the Court did consider this issue on a basis similar to that of personal liability above and concluded at para. [353] that "the claims against Simplot must fail."
[7] The balance of the Trial Decision read:
[354] In the end result, I conclude that the claim and counterclaim both fail. The allegations of infringement have not been established for two reasons, the absence of a frame mounted fertilizer knife and the substitution of a common mounting member for all three key elements constructed so that all three elements moved about a common pivot, and a seed tube which does not engage the soil solely by its outer surface. I have found that there are other substitutions and variations but I conclude that none of them are sufficient to constitute infringement.
[355] The challenges to the validity of the patent also fail though for a greater variety of reasons.
[356] The claim against the individual Seed Hawk defendants fails as infringement has not been found. Had I concluded that there was infringement, I would not have found against the individual defendants as I have concluded that none of their conduct was tortious in itself. Furthermore, there was no conduct to suggest that the corporate vehicle was an instrument of fraud, or simply a device to cloak the personal activities of the individual defendants.
[357] The claim against Simplot also fails because I have found no infringement. However, had I done so, I conclude that there is nothing to show that the Seed Hawk defendants would not have infringed but for the activities of Simplot.
[358] The defendants are entitled to an order dismissing the claim while the plaintiffs are entitled to a declaration of validity of the asserted claims. The defendants are entitled to their costs but, in the circumstances, costs are to be spoken to by way of Notice of Motion.
[359] I wish to express my appreciation to counsel for their assistance and their civility in the course of a difficult trial, which was made all the more difficult for having been spread over four years.
ORDER
Having heard the evidence of the witnesses called by the parties, and having heard the representations of counsel on behalf of the parties, it is hereby ordered and adjudged that:
1- The claims against the defendants Seed Hawk Inc., Pat Beaujot, Norbert Beaujot, Brian Kent, and Simplot Canada Limited are dismissed with costs, costs to be spoken to by Notice of Motion.
2- The counterclaim against the defendants by counterclaim James Halford and Vale Farms Ltd. is dismissed.
[8] All of the parties then brought motions, heard on May 7, 2004, for directions with respect to costs. The Reasons for Order and Order by the trial judge dated September 16, 2004 (hereafter the "Costs Decision") read in part:
...[2] Now comes the time to pay the piper. I have before me motions from the Seed Hawk defendants and Simplot seeking either a lump sum award of costs or directions with respect to the assessment of costs. I also have a motion from the plaintiffs seeking directions as to the assessment of costs with respect to those matters where they were awarded costs in any event of the cause. The plaintiffs also argue that they are entitled to the costs of the defence of the counterclaim as to invalidity, as well as the costs of certain steps within the proceedings where they say the defendants have disentitled themselves to costs....
CONCLUSION
[63] An order will issue with respect to each of the motions for costs, incorporating the terms of these reasons. As for the costs of these motions, I fix the costs of the Seed Hawk defendants and Simplot at $7,500 in respect of their motions. I order that each party shall bear their own costs in relation to the plaintiffs' motion for their costs.
Order with respect to the Seed Hawk defendants' costs
IT IS HEREBY ORDERED that:
1- The defendants Seed Hawk Inc., Pat Beaujot, Norbert Beaujot, and Brian Kent shall have their costs assessed by an assessment officer according to the following directions:
a) there shall be only one order for costs in respect of all the defendants;
b) the defendants' costs shall be assessed at the high end of column IV of Tariff B;
c) there is to be no reduction in the costs assessed by reason of any allegation of misconduct on the part of the defendants, or any increase in costs by reason of any allegation of misconduct on the part of the plaintiffs;
d) there shall be no doubling of costs under Rule 420(2).
2- Costs are to be assessed without awaiting the outcome of the appeal of the judgment rendered after trial, and are payable upon being assessed.
3- Costs assessed against the plaintiffs shall bear interest at the judgment interest rate for the province of Saskatchewan from the date of judgment dismissing the plaintiffs' claim.
4- The defendants are awarded the costs of this motion in the amount of $7,500 plus disbursements.
5- The assessment officer shall dispose of the costs of the assessment in his or her discretion in accordance with Rule 408(3).
Order with respect to the plaintiffs' costs
IT IS HEREBY ORDERED that:
1- The plaintiffs shall have assessed by an assessment officer the costs of proceedings in respect of which they were awarded their costs in any event of the cause in accordance with the following directions:
a) there shall be only one order for costs in respect of all the plaintiffs;
b) the plaintiffs' costs shall be assessed at the low end of column IV of Tariff B;
c) there is to be no reduction in the costs assessed by reason of any allegation of misconduct on the part of the plaintiffs, or any increase in costs by reason of any allegation of misconduct on the part of the defendants.
2- Costs are to be assessed without awaiting the outcome of the appeal of the judgment rendered after trial, and are payable upon being assessed.
3- Costs assessed against the defendants shall bear interest at the judgment interest rate for the province of Saskatchewan from the date of judgment dismissing the plaintiffs' claim.
4- Each party shall bear their own costs of this motion.
5- The assessment officer shall dispose of the costs of the assessment in his discretion in accordance with Rule 408(3).
Order with respect to the defendant Simplot's costs
IT IS HEREBY ORDERED that:
1- The defendant Simplot Canada Limited shall have its costs assessed by an assessment officer in accordance with the following directions:
a) the defendants' costs shall be assessed at the high end of column IV of Tariff B save for motions or other interlocutory proceedings which did not occur in the course of the trial of this matter brought by other parties and in which the defendant in substance merely adopted the position of the other defendants, which motions or other interlocutory proceedings shall be assessed at the midpoint of column III of Tariff B;
b) there is to be no reduction in the costs assessed by reason of any allegation of misconduct on the part of the defendant, or any increase in costs by reason of any allegation of misconduct on the part of the plaintiffs;
c) there shall be no doubling of costs under Rule 420(2).
2- Costs are to be assessed without awaiting the outcome of the appeal of the judgment rendered after trial, and are payable upon being assessed.
3- Costs assessed against the plaintiffs shall bear interest at the judgment interest rate for the province of Saskatchewan from the date of judgment dismissing the plaintiffs' claim.
4- The defendant is awarded its costs of this motion in the amount of $7,500 plus disbursements.
5- The assessment officer shall dispose of the costs of the assessment in his or her discretion in accordance with Rule 408(3).
[9] There was some discussion before me as to the appropriate approach for the assessments. Counsel suggested beginning with comments on factors overriding the issues in general and invited me to deliver "without prejudice" ad hoc observations to assist in resolution of issues. I agreed as that approach, more prevalent in recent years, is consistent with the move to a proactive case management philosophy to promote expeditious resolution of litigation issues. I did however caution counsel that my approach to assessments of costs was grounded in the belief that real dollars are needed to run litigation and that I tended to view a result of nil dollars on assessment as unrealistic in instances of problematic proof where I did not doubt that a party had had to spend money to advance its case.
The Seed Hawk Defendants' Overview
[10] The Seed Hawk Defendants argued that the number of claims in issue in the subject patent contributed to complexity in this litigation. Initially, the Plaintiffs put in issue, of 20 claims, only one independent claim and two dependent claims, but those numbers increased significantly with subsequent amended pleadings. Issues associated with independent claims generate more complexity than those associated with dependent claims because a finding of non-infringement of an independent claim precludes the need to consider infringement of its associated dependent claims. A defendant, faced with allegations of infringement of more than one independent claim, must address each in turn so as to secure a discrete finding of non-infringement for each independent claim. The construction of and evidence for each patent claim, considerable on both sides of this litigation, are discrete meaning that elements of similarity between claims do not reduce the work required.
[11] The Seed Hawk Defendants argued that another major factor contributing to significant costs was the collapse and hospitalization, due to workload, of John Blair, who was the initial counsel for the Seed Hawk Defendants. In a departure from ordinary practice, the Plaintiffs had received permission to serve reply or rebuttal expert affidavits, which they did not do until the eve of trial. This material was very substantial and Mr. Blair accordingly sought, but was denied, an adjournment of the trial. He then collapsed under the strain just three days into the trial. The Plaintiffs' evidence as to the information needed before these additional expert affidavits could be finalized does not justify having put Mr. Blair in that position, by reason of delayed service, because it was insubstantial in the overall framing of the reports. The trial venue, Winnipeg, was not the home base for the Seed Hawk Defendants, their counsel or their experts, unlike some of the Plaintiffs' people, and therefore significant travel and other costs were incurred.
[12] The Seed Hawk Defendants referred to the Costs Decision:
... [46] I now turn to the costs incurred as a result of the adjournment of November 2000. At the time of the adjournment, counsel for the plaintiffs argued that the adjournment should be without any additional costs to his clients. There is already an order awarding the plaintiffs the costs of amendments to the pleadings and the costs thrown away resulting from those amendments. The plaintiffs have detailed those costs in their memorandum. I leave it to the assessment officer to decide which of the items claimed are recoverable.
[47] As for any further consideration by way of costs in relation to the adjournment of November 2000, the record discloses that the then counsel for the Seed Hawk defendants was served with a large volume of material within two weeks of the commencement of the trial. Counsel brought a motion for an adjournment which the plaintiffs opposed, as they were perfectly entitled to do. The motion for an adjournment was refused, the trial proceeded and counsel collapsed under the strain of attempting to deal with the experts' affidavits while conducting the trial itself. I find no fault with the plaintiffs for standing on their rights but the defendants, having succeeded at trial, now stand on their rights to costs. Both positions are equally valid. As a result, I can see no reason to curtail the Seed Hawk defendants' costs as a result of the adjournment of November 2000. In other words, the assessment officer shall not, by reason of the adjournment of November 2000, reduce the fees and disbursements to which the defendants would otherwise be entitled....
to argue that their various costs associated with re-attendance for subsequent trial portions are recoverable.
[13] The Seed Hawk Defendants argued that another major contributing factor for significant costs on their part was duration, ie. four separate attendances, comprising approximately seven weeks, by parties, witnesses and counsel in Winnipeg remote from their respective home bases, as opposed to the Plaintiffs whose Winnipeg counsel did not have to rent office space, secretarial staff, photocopiers and other equipment necessary to run a complex trial at a remote venue. These latter expenses were significant and additional to travel costs such as airfares, hotels, meals and taxis. For example, counsel had to ship approximately 50 boxes of materials to the trial venue each time a trial portion resumed. Several successful objections by the Seed Hawk Defendants to the Plaintiffs' expert evidence inevitably lengthened the trial.
[14] The Seed Hawk Defendants referred to the Costs Decision:
... [23] I attribute no significance to the various allegations relating to the production, volume or evidentiary value of the various affidavits produced by the parties at various times. The equities, in relation to these matters are equally divided. As for the striking of various parts of the plaintiffs' affidavits, this has already been considered under the heading of legal complexity as a good number of the interlocutory motions had to do with these very issues. Furthermore, where liability for costs depends primarily upon success in the action, I can see no reason for reaching into the trial itself so as to use success on interlocutory proceedings as a basis for increasing (or decreasing) costs....
[26] In their submissions, the plaintiffs argue that the defendants have disentitled themselves to costs with respect to various elements of evidence for reasons not dissimilar to those invoked by the Seed Hawk defendants in favour of increased costs. As indicated earlier, I am not inclined to treat motions decided in the course of the trial separately from the trial itself. Nor am I disposed to engage in an ex post facto assessment of the conduct of the trial by any party's counsel, in the absence of some egregious abuse of the process. In my view, counsel for the plaintiffs and for the Seed Hawk defendants did their duty as they saw it and while the process may have been less than surgically precise, it did not depart significantly from what one might expect in the circumstances....
[45] By way of clarification, and to avoid any confusion, the plaintiffs are only entitled to the costs of those matters with respect to which they were awarded their costs in any event of the cause. Motions and other proceedings within the trial are all to be treated as costs in the cause unless a specific order or direction to the contrary was made. I have already indicated my view that the equities are evenly divided as between the parties in terms of the conduct of the action. Consequently, I decline to intervene to deny or reduce the costs to which the defendants are entitled, or to increase the costs to which the plaintiffs are entitled, on the basis of the plaintiffs' allegations of delay or other misconduct. Now that the trial is done, everyone can think of ways in which it could have been conducted differently. As it was unfolding however, everyone did what they thought they had to do to protect their position. While there are things which could have been done differently, I find no egregious abuse of the process which would justify departing from the ordinary course....
and argued that, contrary to the Plaintiffs' position, the trial judge implicitly recognized that various motions and objections throughout the trial, which would include those relating to admissibility of the Plaintiffs' expert evidence, were not improperly made and therefore the costs of the Seed Hawk Defendants should not somehow be reduced as a function of prolongation of the trial. Any such prolongation would have been to the disadvantage of the Seed Hawk Defendants because costs were running up at a remote trial venue. The Seed Hawk Defendants argued that Mr. Blair's agreement to the Winnipeg trial venue does not somehow shield the Plaintiffs from consequent costs of travel. As well, that the trial judge may have considered that certain equities or other factors are divided in addressing the scale of costs does not imply a negative effect on the assessment of costs in a manner inconsistent with the trial judge's intent that the Seed Hawk Defendants recover their costs.
[15] The Seed Hawk Defendants argued that another major contributing factor for significant costs on their part was the Plaintiffs' decision to name officers or directors of the Seed Hawk Defendants as personal defendants and then allege throughout that they had knowingly created the corporate defendant for the purpose of infringing the Plaintiffs' patent. This resulted in several motions and in testimony from several witnesses, all doing little to advance the Plaintiffs' case: see para. [339] of the Trial Decision. That the Plaintiffs declined the trial judge's invitation to drop these allegations contributed to the length and expense of trial.
[16] The Seed Hawk Defendants argued generally that the Plaintiffs' overriding objective was to make this litigation ruinously expensive for them and put them out of business, ie. aspects of proposed settlement and of the Trial Decision. The unreasonable and outrageous circumstances of the third settlement offer reinforce this submission: Rules 409 and 400(3)(e) vest the assessment officer with jurisdiction to take that into consideration. The trial judge, in making his conclusions in para. [338], was not naive and would have been aware of tendencies in a market of competing technology. Further, the evidence does not support the Plaintiffs' position concerning the amounts of offers. Finally, Englander v. Telus Communications Inc., [2004] F.C.J. No. 440 (A.O.) confirms my jurisdiction to allow GST relative to corporate entities.
The Simplot Defendant's Overview
[17] The Simplot Defendant noted that the Plaintiffs' materials attempt to minimize its involvement in this litigation. The Simplot Defendant asserted that its approach was predicated on not wasting the Court's time by repeating submissions already adequately led by the Seed Hawk Defendants. Although its disbursement total does not approach that for the Seed Hawk Defendants, its costs for counsel should not be reduced simply on the basis that his presence was somehow not necessary during portions of the trial.
[18] From the Simplot Defendant's perspective, the defence to the Plaintiffs' action was always a two-step process. First, the Plaintiffs had to establish infringement of the patent by the Seed Hawk Defendants. Second, and only if successful on the first step, the Plaintiffs had to establish their allegation that the Simplot Defendant had induced, aided and abetted infringement. The Simplot Defendant's interest in the subject technology at issue was a function of its manufacture and marketing of large volumes of liquid fertilizer. The existence throughout of an indemnity agreement between the Simplot Defendant and Beaujot Holdings (the original development company associated with the Seed Hawk device) was to shield the former from liability. As such, the Simplot Defendant had some, but not all, interests in common with the Seed Hawk Defendants concerning defence strategy. It was highly interested in maintaining a defence with that of the Seed Hawk Defendants and therefore it was a fine line as to whether to mount its own independent infringement defence as opposed to presenting a united front to the trial judge by trying to influence the nature of the Seed Hawk Defendants' defence. The Simplot Defendant opted for this latter strategy to its ultimate benefit, but it is simplistic for the Plaintiffs to assert that counsel for the Simplot Defendant did not have to be engaged at all stages of the proceedings. The Plaintiffs chose to make it a defendant throughout, resisted settlement, were the subject of an adverse award of a higher scale of costs and must now accept that the trial judge has awarded the full costs throughout for its complete and exhaustive defence.
The Plaintiffs' Overview
[19] The Plaintiffs took exception to references to settlement offers as indicative of anti-competitive intent and noted that the Costs Decision has already fully canvassed and considered the extent of the effect of settlement offers on costs, ie. via a modest adjustment upwards of the scale of costs, and by refusing doubling of costs under Rule 420. Therefore, the settlement offers are irrelevant for the assessment of costs. However, should the settlement discussions somehow be deemed relevant, the Plaintiffs' evidence establishes the errors and unreliability of the Seed Hawk Defendants' evidence on this point.
[20] Although the multiple bills of costs effectively equate to discrete assessments of costs subject however to set-offs, they are in practical terms intertwined, ie. many of the objections to the Seed Hawk Defendants' costs apply equally or to a lesser extent to the Simplot Defendant's costs. There is no adjective other than enormous to describe costs claimed by both the Seed Hawk Defendants and the Simplot Defendant (in the main bills only for each, some $265,000.00 and $202,000 respectively for counsel fees and some $449,000.00 and $71,000.00 respectively for disbursements). The Plaintiffs conceded that this was a long and expensive trial, but these claimed costs are excessive by any objective standard. The factors asserted by the Seed Hawk Defendants simply duplicate those considered and disposed of in the Costs Decision and are therefore irrelevant at this point. The mere fact of long and expensive litigation does not absolve litigants from their responsibility to proceed reasonably, with particular regard to disbursements. The process of assessment of costs requires that each item of costs be examined critically within those parameters. With particular regard to the Seed Hawk Defendants, most of the claimed disbursements do not meet the threshold of reasonable necessity both for the work performed and the amounts claimed. The Plaintiffs conceded my point concerning a result of nil dollars for disbursements upon assessment being absurd in the face of the reality of the expenditure of monies, but argued that the insufficiency here of the evidence warrants reductions. Counsel fees require a somewhat different approach given the terms of the Costs Decision.
[21] The Plaintiffs argued that evidence of similar wording for the independent claims undercuts the assertion that this litigation was made immeasurably more difficult as a function of the need to mount a discrete defence for each. The Plaintiffs pointed to para. [23] of the Costs Decision in arguing that allegations of late service of expert affidavits prior to the 1st Trial Portion in 2000 are irrelevant because the Costs Decision represents the final findings on their impact on costs and it is therefore not open to me to revisit said findings by factoring them into the assessment of costs. The reference to Mr. Blair's unsuccessful motion for adjournment further undercuts the Seed Hawk Defendants' position because the Court concluded then that an adjournment was not appropriate in the circumstances, but the Seed Hawk Defendants now urge, years after said finding by the Court, that I should somehow find that the Plaintiffs' conduct warrants a taxing up factor for costs. A similar argument applies to the assertions of various evidentiary objections as a factor for costs, again because the Costs Decision has already fully accounted for these.
[22] The Plaintiffs argued that the reality of the limited monopoly of a patent means that a prolonged trial worsened their position and this therefore undercuts the premise that the Plaintiffs were attempting to wage protracted litigation to drive the Seed Hawk Defendants out of business. There is nothing in the Trial Decision suggesting a finding of anti-competitive conduct by the Plaintiffs. The Plaintiffs argued that the record establishes that the issues of named personal defendants represented only a small portion of the trial and, in any event, the Costs Decision confirms their irrelevance:
[25] I do not believe that the plaintiffs' decision to name the individual directors as defendants ought to affect the assessment of costs. The law in this area is complex. There were circumstances which could have justified findings of facts which would have supported the plaintiffs' allegations. The fact that I did not draw the conclusions which the plaintiffs urged upon me does not mean that they acted improperly in adding the directors as defendants.
The Plaintiffs noted that counsel for all parties agreed on the Winnipeg venue before the case management judge. The historical practice of choosing a venue as close as possible to the defendants, ie. Regina, was impractical because that would have entailed travel for everyone.
INVALIDITY
The Seed Hawk Defendants' Position on Costs Associated with Issues of Invalidity
[23] The Seed Hawk Defendants argued that, notwithstanding silence on the matter of costs in the Court's dismissal of their counterclaim for a declaration of invalidity, the Trial Decision and the Costs Decision intended that they receive an unqualified award of full assessed costs for their defence of non-infringement in the main action, which was predicted in part on elements of invalidity. The introductory paragraphs of the Trial Decision, and in particular para. [3] thereof, indicate that the trial judge understood the role of invalidity in the defence of non-infringement. Further, the trial judge did not direct that their costs associated with the defence of invalidity in the main action be factored down to preclude costs that could be said to be attributable to the counterclaim. The Costs Decision read:
... [41] ... I now turn to the plaintiffs' motion record with respect to the costs awarded to them. While it does not appear first in the material which they have filed, the most substantial claim which they advance is their claim for the successful defence of the counterclaim alleging invalidity of their patent. Mr. Halford has reviewed the transcript and, in his opinion, roughly the same amount of time was spent dealing with invalidity as was spent on issues of infringement. The concluding paragraph of his affidavit provides as follows:
36. The general practice with respect to costs is that they are awarded in the cause. As a result of the court's findings with respect to the validity of the patent, the plaintiffs submit that they should be entitled to their costs associated with their successful defence of the allegation of that the patent in suit was invalid, a position advanced at trial by both the Seed hawk defendants and Simplot.
[42] This case is on all fours with Illinois Tool Works Inc. v. Cobra Anchors Co. (2003), 312 N.R. 184, 2003 FCA 358 (F.C.A.) (Illinois Tool Works Inc.) in which the successful defendant appealed from an order that each party bear their own costs. As in this case, a claim for infringement was met with a defence of invalidity as well as a counterclaim for invalidity. The claim for infringement was dismissed, as was the counterclaim for invalidity. The trial judge considered that it was a case of divided success and held that each party should bear their own costs. The Federal Court of Appeal allowed the appeal from the order as to costs in the following terms:
[10] The facts of the present instance bring to light the following sequence of events. The respondent was sued for patent infringement by the plaintiffs/appellants. In response to the lawsuit, the respondent raised a defence which, as is often the case in these matters, had two components: first, it submitted that its products did not infringe the plaintiffs' patent and, second, that the plaintiffs' patent was in any event invalid. The respondent's defence did not have to be accepted in its entirety for the lawsuit to be dismissed.
[11] On the facts of this case, we cannot understand how and why the dismissal of the plaintiffs' lawsuit can amount to, result in, or become a divided success. With respect, the judge did not properly take into consideration the end result of the proceedings before him, as required by Rule 400(3)(a)...
[43] If, in those circumstances, it was an error to consider that the plaintiffs in Illinois Tool Works Inc. had achieved success with respect to the counterclaim for invalidity, I cannot see how it would not be an error to come to the same conclusion with respect to the plaintiffs' defence of the counterclaim. Consequently, the plaintiffs are not entitled to any costs with respect to the defence of the counterclaim.
[24] Mr. Justice Pelletier was the trial judge for Illinois Tool Works Inc., supra, and he would have been aware that the Federal Court of Appeal directed that the Defendant there, as the successful party, recover all of its costs in defending the action. Paragraph [11] in Illinois Tool Works Inc., supra, continues:
... This Court came to a similar conclusion in Gorse v. Upwardor Corp. (1992), 40 C.P.R. (3d) 479 (F.C.A.), where the facts and the legal issue relating to costs were analogous, if not identical, to those of the present instance. The following excerpt from that decision at pp. 483-484 is herein applicable:
It is trite to say that the discretion must be exercised judicially. The learned trial judge stated the basis of his decision as to costs in the following terms.
"In the result, this litigation is seen to be futile. The plaintiffs' claim and the defendant's counterclaim are both to be dismissed. It is true - probably - that the defendant would not have been provoked into asserting the counterclaim if the plaintiffs had not commenced their action in the first place. Much of the litigation was generated on account of the defendant's counterclaim, when a relatively simple defence of the plaintiffs' assertion of infringement could have been successfully established. In these circumstances a not unjust result will be obtained by not awarding any costs to any party."
It seems to me that it is a good deal easier for a judge, at the end of a proceeding after he has made up his mind as to its disposition, to decide what minimal pleadings and arguments a party might have advanced and still succeeded than for counsel, with a duty to represent that party to the best of his or her professional ability, to reach such conclusions in advance. An attack on the validity of a patent expressly found "not strong" (p. 172), can scarcely be called frivolous or unnecessary to the defence of an action claiming its infringement. There are many reasons for a judicial exercise of discretion to deny costs to a successful party but, with respect, no such reason was disclosed by the learned trial judge or is otherwise apparent here. The mere prolongation of a trial, without more, by reliance on an ultimately unsuccessful defence is no such reason.
In conclusion, the respondent was entitled to costs as the winning party and there were no valid reasons given to refuse to award them to that party in these circumstances....
The subsequent assessment of costs in Gorse, supra, reported at [1993] F.C.J. No. 70 (T.O.), clearly shows that the full spectrum of costs, including those of the defence of invalidity, were allowed.
[25] In Dableh v. Ontario Hydro, [1993] F.C.J. No. 924 (F.C.T.D.), the trial judge dismissed the claim for infringement and the counterclaim for invalidity. At para. [148], he awarded costs of the main action to the defendant as the successful party, but noted that, although "the defendant's counterclaim is dismissed, it is so assimilated to the defence here, (as in most patent cases), that it is dismissed without costs." The plaintiff appealed the Taxing Officer's decision, reported at [1994] F.C.J. No. 1810 (T.O.), to not factor out costs associated with invalidity. The Court, at [1995] F.C.J. No. 551 (F.C.T.D.), upheld the result at taxation:
... ¶ 9 Having reviewed the evidence in this case, it is clear that the amounts taxed were fair and reasonable under the circumstances. The issue of the amount of trial time allocated to the counterclaim was a highly contentious issue that lacked substantiation from either side. This coupled with the words of Muldoon, J. that the counterclaim was "so assimilated to the defence", indicates that the wide exercise of discretion was required. The Taxing Officer is in a better position to determine these matters. Even if I would have exercised my discretion in a somewhat different manner, I am not convinced that the fees and disbursements granted are excessive or that the apportionment between the claim and counterclaim was capricious. Consequently, this does not satisfy the threshold requirements of IBM Canada, supra, that would warrant my interference....
[26] The Seed Hawk Defendants argued that, in any event, para. [22] of the Trial Decision, referring to Free World Trust v. Électro Santé Inc., [2000] 2 S.C.R. (S.C.C.) 1024, recognizes and accepts consideration of prior art as part of the construction of claims relative to issues of infringement. The consideration in para. [67] of the Trial Decision of the expert evidence is but one example of the trial judge here correctly understanding the principles of claims construction relative to prior art and jurisprudence such as Free World Trust, supra. It follows therefore that the associated costs are recoverable within the purview of the Costs Decision. The Plaintiffs' evidence as to apportionment of time between the main action and the counterclaim is irrelevant.
[27] The Seed Hawk Defendants argued that the request in their cross-appeal of the Trial Decision and the Costs Decision (Federal Court of Appeal file A-99-04) for costs of the defence associated with matters of invalidity is not an admission that the trial judge did not award such costs in the main action, but is simply a request in the ordinary course for an affirmation of the trial judgment. Said request is part of a general request for costs, including those of the cross-appeal, and is there to ensure that the Federal Court of Appeal, because of its jurisdiction to reverse costs below or uphold them or do anything that it sees fit, does not misunderstand their position on entitlement to costs. The grounds set out in the cross-appeal do not elaborate further because this section of the cross-appeal is simply proposing parameters for the judgment sought.
[28] The Seed Hawk Defendants referred to Roger T. Hughes & John H. Woodley, Hughes and Woodley on Patents, (Toronto: Butterworths, 1984) at 439 - 440 and 460 indicating that, although the superior courts of the provinces may find a patent invalid as between the parties to an action, only the Federal Court has the jurisdiction to impeach a patent by declaring it invalid in rem relative to all persons. Therefore, the Plaintiffs' assertion concerning a bare defence of invalidity without an accompanying counterclaim for a declaration of invalidity is not correct in law. In this case, the defence of invalidity was already in issue between the parties before the Seed Hawk Defendants received permission in June 2001 to add the counterclaim.
[29] The Seed Hawk Defendants argued that Almecon Industries Ltd. v. Anchortek Ltd., [2003] F.C.J. No. 1649 (A.O.), can be distinguished because there the plaintiff's claim for infringement was allowed, the counterclaim for invalidity was dismissed and the plaintiff was awarded costs of the action and counterclaim. The comment in para. [13] thereof, that a "counterclaim is essentially an independent action with its own disposition for costs", is not helpful to the Plaintiff's position here in a case in which the counterclaim was simply a procedural grafting onto the defence in the main action of non-infringement relative to invalidity and in which the successful Defendants have been awarded costs, meaning costs of a defence, which did contain a plea of invalidity which was not successful, successfully rebuffing the Plaintiff's entire claim.
[30] The Seed Hawk Defendants noted the introductory portion of LaRoche, Moore, et al. Consolidated Intellectual Property Statutes and Regulations with Related Materials 2006 (Toronto: Thomson Carswell, 2005) at xxv:
... (4) - Costs
In Illinois Tool Works Inc. v. Cobra Anchors Co., the Defendants denied infringement of the Plaintiff's patent, arguing that the Plaintiff's patent was invalid. The trial judge dismissed the Plaintiff's infringement suit, but characterized the dismissal as a divided success because, while the Defendant established there was no infringement, they had not established patent invalidity. As a consequence, the trial judge did not award full costs. The Court of Appeal upheld the finding that there was no infringement of the Plaintiff's patent, but reassessed the costs award on the basis that the end result of the proceedings is to be taken into consideration. The Defendant was the winning party: the characterization of the proceeding as a divided success was made in error....
[Footnotes omitted]
Similar to the situation in Illinois Tool Works Inc., supra, the Plaintiffs' action in asserting patent infringement required counsel for the Seed Hawk Defendants to consider a response in the best interests of the clients, ie. by seeking a declaration of invalidity in addition to the pleaded defence of invalidity. A defence of invalidity is intimately interwoven into the defence of non-infringement. The Trial Decision and the Costs Decision do mean that the trial judge intended to deny the Plaintiffs their costs of defence of the counterclaim. The assessment officer has no jurisdiction to effectively make findings, inconsistent with Illinois Tool Works Inc. and Gorse, supra, of "divided success" by denying costs of the defence of invalidity. The Seed Hawk Defendants were entitled to frame its defence as it did. The Seed Hawk Defendants would not have been required to incur costs of a defence, including those associated with matters of invalidity, but for the unsuccessful action by the Plaintiffs alleging patent infringement.
The Simplot Defendant's Position on Costs Associated with Issues of Invalidity
[31] The Simplot Defendant generally supports the Seed Hawk Defendants' position. The Plaintiffs' position (their brief being entitled "Summary of Plaintiffs' Submissions On The Issue Of Counterclaim Costs") misstates the issue here by characterizing this assessment of costs as addressing counterclaim costs rather than those associated with the defence of invalidity. The Simplot Defendant's defence denied the allegations of aiding, abetting and inducing etc. and then by reference adopted the Seed Hawk Defendants' defence of non-infringement, of which pleas of invalidity were an integral part. The Simplot Defendant did not assert a counterclaim as it would benefit from any positive result flowing from the Seed Hawk Defendants' counterclaim. The counterclaim did not alter the fact that invalidity was integral from the outset to the defence of non-infringement in the main action.
[32] The trial judge never, as the Plaintiffs have argued on this assessment of costs, made issues of invalidity exclusively synonymous with the counterclaim. For example, the Trial Decision indicates a clear understanding that matters of invalidity are relevant both as a defence in the main action and for the purpose of the counterclaim:
... [2] I will begin by laying out the invention described in the disclosure portion of the patent so as to identify its principle and mode of operation. With that understanding of the invention in mind, I will then embark upon a purposive construction of the patent, an exercise whose object is to identify the essential elements of the patent claims. Free World Trust v. Électro Santé Inc., [2002] 2 S.C.R. 1024 at para. 31; 2000 SCC 66 (Free World Trust).
[3] Having construed the patent, I will then turn to the issue of infringement, even though, logically, it would make more sense to deal with the invalidity first. Claims which are invalid cannot be infringed. But the action is one for infringement, and invalidity is raised as a defence and counterclaim. Furthermore, if one errs on the issue of invalidity without having considered infringement, the burden of deciding whether those claims have been infringed either falls upon the Court of Appeal, or it requires that the matter be sent back for further consideration by the trial judge. Neither alternative is particularly satisfactory....
Paragraph [261], under the subheading INVALIDITY, reiterates this understanding and, in the ensuing paragraphs up to para. [316] containing the conclusions on invalidity, does not ever distinguish an element of invalidity as attributable specifically to the defence in the main action or to the counterclaim. The counterclaim did not add time to the trial process, other than creating the capacity, not available in a defence of invalidity, for the Court to make a declaration of invalidity of the patent. The pleadings for the main action and the counterclaim were effectively identical and the trial judge needed only one sentence to dispose of the counterclaim.
[33] The Simplot Defendant asserted a metaphor to summarize its position, ie. the shield being the defence of invalidity in the main action and the sword being the counterclaim to gain a declaration of invalidity. The time spent at trial applied to both and it is simply speculation at this stage as to whether the parties' respective strategies would have been different in the absence of a counterclaim. The addition of the counterclaim does not affect the manner of conduct, but authorities such as the Canadian Encyclopedic Digest, CD-ROM: (Toronto: Carswell, February 2005) "Patents of Invention", § 729, § 869 and § 870, confirm that the available relief, as a function of the presence of a counterclaim in addition to the defence of invalidity, does expand from the limit of being simply inter partes to the broader in rem remedy. It is not necessarily so, because parties in some instances may frame their pleadings differently, that the work on the defence of invalidity in the main action coincides with the work on the counterclaim for declaration of invalidity, but in fact that is exactly what occurred here. The counterclaim, other than the particulars of its relief sought, did not change the case or affect the associated costs and time required.
[34] The Simplot Defendant argued that Gorse, supra, essentially holds that counsel cannot precisely anticipate the minimal pleadings and arguments to ensure success as opposed to the trial judge who, having made his findings, is in a much better position to do so. Gorse, supra confirmed in Illinois Tool Works Inc., supra, then concludes that if a defendant successfully defends in the main action as here, it is entitled to the full costs of said defence without any factoring down of costs of those elements of said defence which, as here for invalidity, ultimately proved unsuccessful. Gorse, supra also holds that a judge's Rule 400(1) discretion to deny or limit a successful defendant's costs must be exercised judiciously, ie. the mere prolongation of a trial because of elements, ultimately unsuccessful, of a defence in itself successful overall is not sufficient grounds to deny or limit costs. It is irrelevant that the unsuccessful portion of the defence was also expressed as a counterclaim.
[35] The Plaintiffs' evidence and argument concerning the time at trial devoted to matters of invalidity were irrelevant for the Costs Decision and are irrelevant at the assessment of costs. The trial judge here was well aware of the findings in Illinois Tool Works Inc., supra as his decision there as trial judge was overturned by the Federal Court of Appeal. Here, he was silent on the costs of the counterclaim, but there is no hint in either the Trial Decision or the Costs Decision that the Defendants' costs of defending this litigation were somehow to be limited. For example, in para. [31] of the Costs Decision allowing something for junior counsel, he used terms such as "[D]uring the course of the trial", "the trial" and "the trial portion of the action" without specifying that the assessment officer shall somehow tailor the allowance for junior counsel to exclude costs associated with issues of invalidity. At para. [56], he used the phrase, "I award Simplot its costs throughout", again without any accompanying language requiring the limitation of said costs as a function of issues of invalidity. There is however, in para. [56], limiting language demonstrating the jurisdiction of the Court, consistent with Illinois Tool Works Inc., supra, if it wishes to give instructions limiting the extent of costs at the assessment thereof. In para. [56], that limitation does not address issues of invalidity, but rather, in specifying that the Simplot Defendant's costs are to be taxed at the mid-range of Column III, it expressly excludes "motions made in the course of the trial." For the assessment officer, at the invitation of the Plaintiffs, to act by limiting the costs of the defence as a function of issues of invalidity would be an improper exercise of my jurisdiction, and beyond my authority in any event, and inconsistent with the principles of the judicial discretion as to costs expressed in Illinois Tool Works Inc., supra. The core understanding to keep in mind is that issues of invalidity and issues of counterclaim in these circumstances are not synonymous.
The Plaintiffs' Position on Costs Associated with Issues of Invalidity
[36] The Plaintiffs conceded that the Defendants may claim costs in the main action for their defence to allegations of infringement as a function of a discrete judgment thereon. However, a separate judgment on the Defendants' counterclaim for invalidity precludes them from claiming associated costs because it was silent on costs. As the Simplot Defendant joined in the counterclaim for invalidity, the assessment officer does not have the Rule 400(1) jurisdiction of the Court to award it counterclaim costs in the face of that silence. The Plaintiffs' evidence establishes that the counterclaim occupied a large portion of the trial and, as the bills of costs lump all fees and disbursements over the course of this litigation without attributing them to one or the other of the main action and the counterclaim, the result upon assessment thereof must reflect a significant factoring down of costs to specifically account for the failed claims for invalidity. Paragraph [41] of the Costs Decision specifically addressed the Plaintiffs' request for costs of the counterclaim and acknowledged the Plaintiffs' evidence asserting that roughly equal amounts of time were spent addressing issues of infringement and invalidity respectively. If the trial judge had thought that the evidence was somehow inaccurate, he would have said so, but he did not.
[37] The Plaintiffs argued that it is critical, for the purpose of this assessment of costs, to understand the intent of the order following para. [359] of the Trial Decision. The trial judge, in the main action, dismissed the claims against the Seed Hawk Defendants and against the Simplot Defendant. Those claims as against the Seed Hawk Defendants were a function of allegations of infringement of certain parts of the subject patent. Those claims as against the Simplot Defendants were a function of allegations of activities having the effect of inducing infringement. The Trial Decision directed that the associated costs of defence be spoken to by motion, which subsequently resulted in the Costs Decision providing for costs specific to the main action only. The Trial Decision was silent as to costs of the counterclaim and the Costs Decision did not allow costs associated with invalidity. The Seed Hawk Defendants' cross-appeal seeks to remedy that omission and asks that the Federal Court of Appeal allow costs associated with invalidity and, with particular significance for this assessment of costs, costs of the defence to the main action allegations of patent infringement to the extent that said defence is based on elements of invalidity. That represents a clear acknowledgement that the trial judge did not award costs of those elements of the defence associated with invalidity. The reality is that litigants do not ask appeal courts for affirmations of orders of lower courts already favourable to them, but rather for replacement of unfavourable orders. The preamble of the cross-appeal seeks to set aside the Trial Decision's dismissal of the counterclaim and then goes on to request a declaration of invalidity and costs relating to invalidity. It does not mention affirmation at all, but instead seeks from the appeal court what the trial judge did not give. In the face of the trial judge's restriction of costs to the main action, this all works to undercut the costs claimed here for invalidity.
[38] The Plaintiffs relied on Mark M. Orkin, The Law of Costs, 2nd ed., looseleaf (Aurora, Ont.: Canada Law Book, 1987) at 1-17:
105.7 No Order as to Costs
A statement by the court or endorsement on the record to the effect of "no order as to costs" is, of course, an order as to costs, and means that neither party shall pay any costs to the other. Similarly, if judgment is given for a party without any order being made as to costs, no costs can be assessed by either party; so that when a matter is disposed of on a motion or at trial with no mention of costs, it is as though the judge had said that he "saw fit to make no order as to costs".
[Footnotes omitted]
to argue that, as applied here, the trial judge's silence as to costs of the counterclaim reflected his intention to not award costs associated with invalidity to the defendants. Regardless of the Seed Hawk Defendants's assertions about case law holding that judges expressly say so when they do not want to award costs, the clear and unequivocal principle is that, in the absence of a visible order for costs, there is no entitlement to costs. Further to Charles Stinson, "Bill of Costs and Assessment", Federal Court[s] Practice, 2003 Update: Materials Prepared for the Continuing Legal Education Seminar, (September 19, 2003), at 10.1.01 - 10.1.38, and to Rule 400(1), the assessment officer has no jurisdiction to substitute his authority for that of the Court and effectively award costs that the trial judge has already decided not to so award.
[39] The Plaintiffs relied on The Law of Costs, supra, at pp. 6-7 and 6-8:
602.3 Powers and Duties of Assessment Officer
602.3(1) General
The function of an assessment officer is to assess costs the right to which has been established elsewhere. Thus, where there is no order awarding costs the assessment officer cannot allow them....
The assessment officer is bound by the order referring costs to be assessed....
[Footnotes omitted]
to argue that is exactly the situation here: I am bound by the trial judge's silence as to costs of invalidity.
[40] The facts in Milliken & Co. v. Interface Flooring Systems (Canada) Inc., [2003] F.C.J. No. 1586 (A.O.), are not particularly relevant here, but para. [17] does affirm the above principle concerning orders silent as to costs. In Almecon Industries Ltd., supra, the Plaintiff, unlike here, was successful in the main action for patent infringement and in its defence of the counterclaim, with costs for both. That decision also affirms the above principle and is particularly instructive in that, unlike here, there at least was a visible order for costs:
... ¶ 3 The Plaintiff presented a single bill of costs encompassing the four trial court files. The Plaintiff (as Respondent) presented a single bill of costs for the related Federal Court of Appeal matters (A-34-02 and A-398-02). A copy of these reasons is filed in each court file and applies there accordingly. Before me, counsel for both sides agreed on certain items. As well, counsel for the Plaintiff withdrew claims for certain interlocutory items because their associated orders were silent as to costs. I have made the appropriate notations on the bills of costs as assessed and filed....
Item 24: 5 units claimed for travel by the Plaintiff's counsel for the test conducted by expert Clifford J. Anderson on the Defendant Plug (1 - 5)
¶ 20 The Defendants noted that re-scheduling of this test was the subject of their motion just before trial. The trial judge ordered that the motion be adjourned sine die (July 24, 2001) after strongly recommending that the Plaintiff reproduce the test for the Defendants. The Defendants objected to any allowance for counsel fees, and associated travel disbursements, because the Court never considered the substantive elements of the motion and because such costs are claimed as a function of the Court's order, which was silent on costs. The Defendants argued that paragraph [82] of the trial judge's reasons is not a positive comment on the value of this test.
¶ 21 The Plaintiff argued that the order is not silent on costs because no order ever issued on the merits of the motion. The Plaintiff asserted that the Defendants' conduct caused them to miss the first test, which was part of trial preparation. The fact that the Defendants followed up with a motion for relief demonstrates that they thought the test was relevant. Paragraph [27] of the Federal Court of Appeal's reasons supports the relevance of the test.
Assessment
¶ 22 These costs are part of trial preparation and were not relevant for the hearing of the motion. The Federal Courts Act, ss. 4 and 5.1 defining the Court, and Rule 2 of the Federal Court Rules, 1998 defining an assessment officer, preclude me from usurping the discretion vested in the Court by Rule 400(1) to award costs. A Rule 400(1) award of costs does vest an assessment officer with jurisdiction to decide which items of costs are to be allowed and their quantum. I do not exercise the discretion reserved to the Court for item 24. The special directions in the Supplementary Judgment - Costs do not cover this particular claim and I therefore disallow item 24. However, I routinely allow associated travel disbursements, in the absence of special directions for item 24, if the presence of counsel is essential at a venue. Here, I consider the presence of lead counsel to have been essential and I allow the associated travel disbursements within my reduced allowance below for the $40,817.09 in issue for travel for pre-trial matters....
[41] The Plaintiffs summarized the position of the Seed Hawk Defendants and the Simplot Defendant as holding that an assertion of invalidity is really the defence to a claim of patent infringement and that the bringing of a counterclaim for declaration of invalidity is nothing more than a procedural addition to the process that does not change or mean anything in a significant way. The conclusion in para. [13] of Almecon, supra, ie. "that a counterclaim is essentially an independent action with its own disposition for costs", undercuts that position. That the assessment officer in Almecon, supra went on to give no weight to the absence of a claim for counterclaim costs simply reinforces the notion that the disposition of counterclaim costs exists or stands apart from the disposition of costs in the main action. Paragraph [7] in Rolls-Royce plc v. Fitzwilliam, [2004] F.C.J. No. 626 (A.O.), stands for the same principle.
[42] The Plaintiffs argued that Wilson v. Canada, [2000] F.C.J. No. 506 (A.O.) (reversed by [2000] F.C.J. No. 1783 (F.C.T.D.) only on the jurisdiction of assessment officers to address interest on costs, but otherwise affirmed) also affirms this principle:
... ¶ 37 In Re Banks and Banks v. Yule, supra, the government contended that the monies due to the Plaintiff from the Unsatisfied Judgment Fund (for motor vehicle accidents) further to judgment against the Defendant in the main action could be properly reduced by set-off against the monies due to the Defendant further to judgment against the Plaintiff in the counterclaim. Alternatively, the government asserted that the sum due to the Plaintiff represented an asset available for realization by the Plaintiff relative to his judgment against the Defendant. The unpaid solicitor for the defendant advanced a lien for costs and opposed such set-off. The Court noted past limits (p.38) on the jurisdiction of the Taxing Officer concerning set-off, limitations protecting a solicitor's lien for costs relative to set -off for which interlocutory costs in the same action were an exception (p.39) and considered the history of equitable jurisdiction concerning set-off (p. 39).
¶ 38 In concluding that an action and counterclaim were independent proceedings, but that the solicitor's lien for costs precluded set-off in the circumstances (pp.42-43), the Court commented (p.42):
... Another authority cited in Holmested & Langton, op. cit., is that of Brown v. Nelson, 11 P.R. (Ont.) 121, decided before the introduction of the old R. 253 but after our present R. 115 had come into existence. The result in that case would also seem to support the proposition mentioned in Holmested & Langton but I point out that it was a judgment of a single Judge, who expressed doubt about his power to entertain the matter. At p. 124 of that report, Osler J.A. treated the cause as being comprised of both claim and counterclaim since they arose out of the same transaction. He clearly acknowledged that he did not wish to be understood as holding that where the claim and counterclaim were independent of each other the costs should be dealt with otherwise than they were before the Judicature Act. With respect, it seems to me that such reasoning loses sight of the sharp distinction between a set-off and a counterclaim. A set-off is a defence; a counterclaim is a cross-action. In the former the verdict is only for the balance; in the latter there are two distinct verdicts. Those differences are important but do not seem to have been afforded their proper place in the judgment in Brown v. Nelson. If, as would appear to be the case, the counterclaim was truly in the nature of a cross-action, then the claim and counterclaim could not be looked upon as one cause. It is also to be noted that while an appeal was taken from that judgment the matter was settled before being heard by the Divisional Court...
Although the Plaintiff here incorrectly relies on the Income Tax Act for his premise, this passage succinctly captures that part of his position asserting that awards of costs, as a function of discrete actions or proceedings, should not be congealed into a single block thereby precluding independent execution and collection of each award of costs all as a function of independent judgments. I found this passage difficult to resolve with my conclusions below because, while it did not preclude an equitable exercise of discretion and rather placed certain conceptual limits on that exercise relative to the potential for prejudice to the solicitor's lien for costs in the circumstances of Re Banks and Banks v. Yule, it did not appear to preclude it in the circumstances of other independent actions.
¶ 39 An interlocutory proceeding has its own issues and disposition independent of and distinct from the main action or any other interlocutory proceeding and therefore, although part of the continuum of that single piece of litigation, is not part of the deliberations required of the trial Judge. However, consistent with the strict concept of set-off in Re Banks and Banks v. Yule, supra, it arises out of the same cause and is appropriate for set-off. The rationales for set-off of costs between action and counterclaim; between action and appeal and between independent actions, in terms of Re Banks, are much more divisive issues in the authorities. Here, the parties are the same, different causes of action were heard together in one of the trials; the same Court and Act governing subject matter are involved; there is apparently no solicitor's lien for costs in issue and there is no delay required to address outstanding assessments....,
but what is particularly instructive are the references to the blending of proceedings as if all part of a single transaction, which the Seed Hawk Defendants and the Simplot Defendant have incorrectly done here for the discrete, separate and independent main action, counterclaim and the respective verdicts thereon. Rather, the trial judge here clearly understood that the main action and the counterclaim were independent of one another, ie. by his respective and discrete dispositions of their costs.
[43] The Plaintiffs argued that Dableh v. Ontario Hydro, supra (T.O.), at para. [7] takes this notion a step further by asserting that the independence of the counterclaim generates a separate bill of costs, which presumably would assist in better apportionment between invalidity and infringement issues, which is the problem here. That is, the "omnibus" bills of costs led here demonstrate no attempt to separate, segregate or distinguish between those costs properly attributable first to the decision on non-infringement, for which costs of the defence were allowed, and second to the decision on invalidity, for which the trial judge's silence on the associated costs means that no costs were allowed.
[44] The Plaintiffs argued that the Defendants' position that the counterclaim did not add any real time to the trial is undercut by the reality that, without the counterclaim, the myriad references to prior art and allegations of invalidity in a statement of defence, and the notion of the assimilation of elements of invalidity into the defence, are absolutely meaningless in terms of substantive relief. The Patent Act provides jurisdiction for a separate action for declaration of invalidity meaning a more efficient procedure for the Court to hear the two independent causes of action one after the other. The Defendants here made a conscious decision to amend their case to include a counterclaim and the real thrust of their costs did not address the defence of invalidity, but rather the counterclaim for declaration of invalidity. Any reference therefore to jurisdiction of the superior courts of the province is irrelevant.
[45] In the Federal Court, there may be a single trial, but in its context, the plaintiffs put in their case for infringement followed by the defendants' case for their defence of non-infringement. Then, in a separate proceeding continuing immediately before that same trial judge, the defendants put in their case of invalidity followed by the plaintiff's defence of validity. That the trial decision here constituted a single document is irrelevant because it actually rendered discrete judgments for each separate and independent action as opposed to a single judgment addressing both the main action and the counterclaim. The evidence confirms that a discrete presentation of the cases for non-infringement and invalidity did so occur. In particular, an example, not exhaustive, in the trial transcript (pp. 4339-4340) discloses lead counsel for the Seed Hawk Defendants clearly shifting focus from non-infringement to invalidity during the examination of Clifford J. Anderson:
... MR. MACKLIN: Now, My Lord, that therefore is the evidence of this witness on his affidavit in respect to infringement. And we can go on now to deal with validity and get it all in, and then if my friend wishes to cross-examine on -- do you want to break now to cross-examine on infringement or -
MR. RABER: Just go ahead.
MR. MACKLIN: Thank you. My Lord, we're now addressing the issue of validity, and this of course is -- whereas the infringement was rebuttal evidence, if you will, to the evidence of the plaintiffs, this is now in chief....
The implication for costs is the invitation to Mr. Raber to cross-examine on Mr. Anderson's evidence on infringement for the defence in the main action and then, following his evidence in chief yet to come on invalidity for the counterclaim, cross-examine him on said evidence on invalidity or, as Mr. Raber chose to do in the interests of expediency, roll everything together in a continuous cross-examination which does not however discard the reality of independence of these two actions. The various interlocutory orders made in the course of the trial confirm or are consistent with this distinction. The Plaintiffs rejected the Simplot Defendant's shield and sword analogy because the "shield" is ineffective without the accompanying counterclaim for declaration of invalidity.
[46] The Plaintiffs argued that the evidence confirms that a substantial portion of the trial addressed issues of invalidity, but does not indicate prior art evidence assisting the Court in claims construction. Significantly, claims construction on the Trial Decision occupies considerable space, but does not refer to prior art documents in evidence nor witness testimony on prior art. The template set out in para. [22] of the Trial Decision does not include prior art or extrinsic evidence. Therefore, it is simply wrong to conclude that prior art was essential or important to claims construction and that it addressed something other than the failed counterclaim for invalidity.
[47] The Plaintiffs argued that a careful reading of Illinois Tool Works Inc., supra and Gorse, supra confirms that they cannot be used to manufacture an entitlement to costs in the face of an order silent as to costs. The decision in Illinois Tool Works Inc., supra was raised before the trial judge here in the context of the Plaintiffs claiming costs for their successful defence of the counterclaim. Mr. Justice Pelletier, as the trial judge for Illinois Tool Works Inc., supra, found that the claim for infringement failed and that the counterclaim for invalidity failed, meaning circumstances of divided success, and therefore all parties should simply bear their own costs. The Federal Court of Appeal found that he had erred on this latter point and overturned him. Thus, Mr. Justice Pelletier in the Costs Decision here quotes from Illinois Tool Works Inc., supra and concludes:
... [43] If, in those circumstances, it was an error to consider that the plaintiffs in Illinois Tool Works Inc. had achieved success with respect to the counterclaim for invalidity, I cannot see how it would not be an error to come to the same conclusion with respect to the plaintiffs' defence of the counterclaim. Consequently, the plaintiffs are not entitled to any costs with respect to the defence of the counterclaim....
[48] This does not mean that the Defendants can assert further to Illinois Tool Works Inc., supra that their successful defence to the claim of infringement and inducement entitles them to all of their costs, including those of the failed counterclaim. Rather, Mr. Justice Pelletier simply concluded that, further to Illinois Tool Works Inc., supra, it would be incorrect to award to the Plaintiffs costs associated with their successful defence in the counterclaim, because to do so would effectively treat this case as one of divided success when, in fact, it was not. The Trial Decision awarded costs to the Defendants relative to their defence of the claims advanced against them by the Plaintiffs, but did not award costs of the counterclaim and on that basis alone is distinguishable from Illinois Tool Works Inc., supra. The Federal Court of Appeal there found that the error, ie. the conclusion that each party should bear its own costs because each had achieved part of the relief each had sought, stemmed from the failure to take into account the end result of the proceedings as required by Rule 400(3)(a).
[49] Significantly, the Federal Court of Appeal vacated his directions on costs and simply replaced them with the award that the trial judge should have made in the first instance: dismissal of the plaintiff's action with costs. It does not follow from that result that the Defendants here are entitled to costs of the failed counterclaim. The Plaintiffs' successful defence here of the counterclaim for invalidity, following dismissal of their action for infringement, is not an instance of divided success and that is why the Defendants here received their costs of defence of non-infringement in the main action. All that Illinois Tool Works Inc., supra does is preclude the Plaintiffs here from recovering their costs of the counterclaim. As well, it precludes an improper exercise of discretion requiring both parties to bear their own costs. The deferral, in the Trial Decision, of costs to be spoken to later by motion afforded full opportunity for the Defendants to ensure clarity in the Costs Decision on this issue: both decisions were silent. Per The Law of Costs, supra at pp. 6-9 and 6-10:
... 602.3(3) Costs to be assessed in accordance with judgment
Where there is a judgment for costs generally, the assessment officer's duty is to follow any directions as to costs in the formal judgment and assess costs in favour of the party to whom they have been awarded. He or she has no jurisdiction to question the validity of the order by virtue of which costs are being assessed; ... or look behind the substantive judgment; ... or to receive evidence to contravene such order; ... or to interpret it in the light of reasons for judgment expressed by the court; ... but the order is to be explained by the ordinary rules of construction....,
the assessment officer is bound by the terms of the judgment.
[50] The Plaintiffs noted that, in Gorse, supra, the trial judge had dismissed both the main action and the counterclaim and had directed that each side bear its own costs. Specifically, he denied costs to the defendant on the basis that much of the litigation was devoted to an unnecessary counterclaim when it was apparent that a simple defence of non-infringement would have been sufficient. The Federal Court of Appeal conceded the discretion of the trial judge for costs, but asserted that it must be exercised judiciously and that it was an error in law to have denied the defendants' costs of its counterclaim simply because, in hindsight, a minimal defence of non-infringement would have succeeded. That does not mean that a successful defence of non-infringement in the main action, coupled with a failed counterclaim for invalidity, results in indemnity for all costs in both actions. That is, the proposition in Gorse, supra strictly addresses an error of law as a function of an improper exercise of discretion.
[51] The Plaintiffs referred to David Sgayias et al., Federal Court Practice 2005 (Toronto: Thomson Carswell, 2004) at 520, containing Rule 189(1) permitting a defendant to seek relief against a plaintiff by including a counterclaim in its statement of defence instead of having to bring a separate action. The editorial comment on page 520 describes such a counterclaim as "essentially an independent action that is grafted procedurally onto the existing action" and notes that jurisdiction "to entertain a counterclaim must be found as if that claim were advanced in a separate action." At page 520 in the table of cases, Innotech Pty. Ltd. v. Phoenix Rotary Spike Harrows Ltd. (1997), 74 C.P.R. (3d) 275 (F.C.A.) confirms that a counterclaim "must be viewed as a distinct action." Rule 190 is consistent with this notion in permitting a counterclaim to continue notwithstanding disposition in the main action. The Defendants' position, ie. that prior art evidence cannot all simply be put in the category of issues of invalidity because prior art was also relevant to issues of claims construction and non-infringement, is a transparent attempt to recast the costs of the failed counterclaim for invalidity, which the trial judge did not allow, as costs of the successful defence of non-infringement, which the trial judge did allow. Generally, the Plaintiffs relied on my paper supra for the Continuing Legal Education Society of British Columbia and the decisions in Milliken & Co., supra and Almecon Industries Ltd., supra to argue that, if the Defendants'costs at trial are to be reduced as a function of the failed counterclaim for invalidity, the trial preparation costs should undergo a corresponding or significant reduction as well.
Assessment of Issues of Invalidity
[52] Upon resumption of the assessment of costs on June 27, 2005 in Winnipeg after the initial five days of hearing earlier in Calgary, I gave a without prejudice opinion, favourable to the Defendants, on issues of invalidity as a factor affecting the costs herein. This streamlined somewhat the balance of the assessments. My opinion has not changed. In some ways or perhaps generally, jurisprudence evolves incrementally. I am not certain whether my conclusions represent an affirmation of practice in the intellectual property field or simply a misstep based on my possible misunderstanding of the relevant principles of law, but I wish to assure the Plaintiffs that my relatively brief rationale does not mean that I did not consider very carefully the cogent and well-reasoned submissions of their very able counsel. Rather, those latter submissions existed against equally strong materials from the other side. Into this mix of opposing positions, I injected a number of factors or rhetorical questions troubling me as well, which I will first outline before briefly commenting on the case law. I am not sure whether these latter considerations helped or hindered in the end, but they did assist in ensuring that I considered as many perspectives as possible.
[53] Relative to the notion of a counterclaim as an independent action grafted procedurally to the main action, is it irrelevant that a single trial judge used a single document to deliver judgment for both? Is that single document, ie. the Trial Decision, effectively two discrete judgments or simply a single judgment addressing two independent actions? Is it incorrect to think of it as a single judgment, particularly because it was the same judge throughout, or should I presume that the trial judge had in mind that he was required to render judgments independent of one another for two discrete actions? Can it be said that, since the main action and the counterclaim procedurally grafted to it are still two discrete actions independent in nature, that different judges, regardless of the potential inefficiencies relative both to use of judicial time and to costs for the parties, could hear them separately, ie. one for the main action and the second for the counterclaim, or would that be precluded by reason of some undistilled apprehension of conflicting judicial opinions on evidence having some, if not all, elements common to both?
[54] Is the shield and sword analogy apt? That is, regardless of whether the events as they unfolded or the Trial Decision confirm that work relative to invalidity did or did not specifically apply to the defence of non-infringement, does the notion of these two independent actions heard by the same judge beget the notion that I should deem that, for purposes of costs, the work for invalidity may be viewed as effectively first for the main action and then separately for the counterclaim? Presumably, this would mean that the Defendants could not, if they had been given costs of the counterclaim, be allowed to claim twice for effectively the same work because of a principle of costs precluding profit thereby. The alternative requires apportionment. The considerations might be different depending on whether the counterclaim is asserted coincident with the statement of defence in the main action or later as here.
[55] On the assumption that there are discrete judgments for actions, both heard by the same judge and involving the same or common evidence, can I ignore one judgment as irrelevant for issues arising as a consequence of the other judgment? That is, in the particular circumstances here, can or must I simply ignore the consequences or implications of the counterclaim judgment and apply the main action judgment in a vacuum without regard to potential conflicts or inconsistencies as asserted by the Plaintiffs? Put another way, is a judgment with a positive or acquisitive feature, ie. such as costs in the main action, to be preferred or carry more weight than a judgment with a negative or non-acquisitive feature, ie. silence as to costs of the counterclaim? The corollary to this is whether I can or should speculate on the intent of the trial judge? If the answer is negative to these latter questions, am I bound to accept the Plaintiffs' position? Was this trial effectively two consecutive trials, as opposed to coincidental hearings before a single trial judge? On the assumption that the trial judge did not intend that the costs associated with invalidity in the main action be factored out, am I faced with one judgment or two judgments, both addressing the same costs, but with opposite or apparently opposite effect?
[56] I stand simply on and confirm my without prejudice comments already delivered on June 27, 2005. The Court at para. [11] of Illinois Tool Works Inc., supra, with particular regard to Gorse, supra, was not assessing a bill of costs nor could it be said that it had in mind the circumstances before me. However, what I take from Gorse, supra, with particular regard to its comments concerning the relevance of a defence of invalidity in the main action alleging infringement, and as well with regard to the circumstances of the notion of divided success relative to the main action and the counterclaim, is that I should not view the counterclaim judgment as somehow inconsistent with or inhibiting the effect of the main action judgment. Rather, I should apply the main action judgment to costs as I would any other judgment to permit the Defendants here to recover their costs for the full range of their defence of non-infringement, including costs for those elements of invalidity in said defence, regardless of clarification or not in the evidence or the judgment concerning the role or extent of that failed portion of the defence.
[57] It is unnecessary to consider whether it is unfair, relative to issues of invalidity and a counterclaim judgment silent as to costs, that the Plaintiffs cannot claim costs associated with invalidity, but the Defendants can do so without restriction. Rather, I think that I must keep in mind that, in law, the role of defendant in an action is different in principle from the role of plaintiff in an action, from the perspective, for example, of the strategy by which each frames their respective pleadings or puts in their respective cases at trial. The trial judge here did not visibly limit the costs of the defence in the main action, regardless of his silence as to costs for the Defendants as counterclaim plaintiffs. One interpretation of Mr. Macklin's characterization (p. 4340 trial transcript) of Mr. Anderson's evidence to come on invalidity as being "in chief" could be, given that he distinguished it from his evidence on infringement by referring to the latter as "rebuttal evidence, if you will", is that Mr. Macklin was referring to the counterclaim relative to Mr. Anderson's evidence on invalidity. With respect, I simply do not view this passage as an admission or concession by Mr. Macklin fitting squarely within the premise for costs advanced by the Plaintiffs.
The Further Revised Bill of Costs of the Seed Hawk Defendants (hereafter the "Bill of Costs")
Disbursements relative to the Seed Hawk Defendants' expert Clifford J. Anderson for his professional services (a number of invoices totalling $145,981.45 + GST) and his trial travel expenses ($4,438.90 + PST and GST as appropriate)
The Seed Hawk Defendants' Position on Clifford J. Anderson
[58] The Seed Hawk Defendants initially retained two experts. Ben Dyck, P. Eng. prepared two expert affidavits served on the Plaintiffs. Due to a number of evidentiary rulings at trial concerning inadmissibility of portions of the Plaintiffs' expert evidence, and in a desire to shorten the trial, counsel decide to not call him either as an expert or as a fact witness. No costs are claimed for him, although counsel stand by the necessity at the time to prepare his testimony (he was present as well for substantial portions of the first three trial portions and, although his name appears in several invoices, no costs are claimed for those attendances). The Seed Hawk Defendants relied on Clifford J. Anderson, P. Eng. as its expert. He prepared four expert affidavits. The first was sworn February 28, 2000, and re-sworn on February 3, 2003, after slight changes thereto (hereafter the "1st Anderson Affidavit"): it was the only one tendered at trial. The second was sworn on June 30, 2000 (hereafter the "2nd Anderson Affidavit"), pre-dating as well the introduction of the counterclaim for invalidity. The third was sworn on June 19, 2001 (hereafter the "2nd Supplemental Anderson Affidavit"). The fourth was sworn on August 16, 2001 (hereafter the "3rd Supplemental Anderson Affidavit"). Although it was reasonably necessary to prepare the 2nd Anderson Affidavit and the 2nd Supplemental Anderson Affidavit in the circumstances at the time, certain evidentiary rulings at trial on the inadmissibility of portions of the Plaintiffs' expert evidence, certain admissions induced at trial in cross-examination, counsel's assessment of the sufficiency of the Plaintiffs' case as led at trial and the desire to shorten and complete the trial within the time limitations imposed by the Court all combined and led ultimately to a decision to not enter these two expert affidavits. The 3rd Supplemental Anderson Affidavit was withdrawn shortly after service as a result of discussions by Mr. Anderson with the Scandinavian witnesses (see below) regarding the prior art, prompting identification of inaccuracies.
[59] The initial claim of $164,456.99 for Mr. Anderson's work has been lowered to $145,981,45. The premise in Gorse, supra, ie. that hindsight should not absolutely govern the gauge of reasonable necessity at the time the decision was made to incur costs, should apply here in the face of the Plaintiffs' considerable body of expert evidence. Paragraph [41] of Almecon Industries Ltd., supra acknowledges that costs for experts are a reality of litigation. Relative to all of the experts, the trial judge commented on the concern for partisanship and what the role of expert evidence should be, but eventually in para. [24] "found Mr. Anderson to be the least partisan of this group of witnesses." Although the trial judge did not find that Mr. Anderson was qualified as to seeding devices and although he had both favourable and unfavourable comments on his evidence, the trial judge did accept his qualifications as a mechanical engineer to give expert evidence on the design and operation of mechanical devices relevant to this litigation. His unfavourable comments on the Plaintiffs' expert witnesses were stronger. The trial judge did not suggest at all that Mr. Anderson's evidence was cause for reduction of his accounts. Although not necessarily throughout, the trial judge's reliance on Mr. Anderson's evidence was key to the successful defence of non-infringement. Any expressed skepticism by a trial judge concerning an expert's evidence is an ordinary feature of the testing of its validity before using it to assist in a court's conclusions for the litigation. Relative to the comments in Apotex Inc. v. Syntex Pharmaceuticals International Ltd., [1999] F.C.J. No. 1465 (F.C.T.D.) at paras. [19]-[21] inclusive concerning a "Cadillac" of experts, Mr. Anderson's accounts are not excessive.
[60] These comments in the Costs Decision:
... [23] I attribute no significance to the various allegations relating to the production, volume or evidentiary value of the various affidavits produced by the parties at various times. The equities, in relation to these matters are equally divided. As for the striking of various parts of the plaintiffs' affidavits, this has already been considered under the heading of legal complexity as a good number of the interlocutory motions had to do with these very issues. Furthermore, where liability for costs depends primarily upon success in the action, I can see no reason for reaching into the trial itself so as to use success on interlocutory proceedings as a basis for increasing (or decreasing) costs.
[24] Similarly, I am not disposed to increase costs by reason of the Seed Hawk defendants' decision not to lead certain evidence. It is bad enough that the plaintiffs were put to the trouble of preparing to meet that evidence, the cost of which is essentially thrown away, without asking them, in addition, to pay increased costs for evidence not led....,
occurred in the context of the trial judge's consideration of the appropriate scale of costs, which ultimately led to directions for the high end of Column IV. This represents the final disposition of the Court relative to any factoring down of costs for evidence not ultimately led. In other words, the Seek Hawk Defendants are entitled to costs throughout for Mr. Anderson.
[61] The Plaintiffs' position asserts that, as the Seed Hawk Defendants' evidence supporting the motion for permission to file the 2nd Supplemental Anderson Affidavit in June 2001 gave the reason as Mr. Blair apparently not having properly instructed Mr. Anderson as to the law concerning infringement, ie. by incorrectly directing him to compare the Halford and Seed Hawk devices as opposed to comparing the claims of the Halford patent with the Seed Hawk device, no costs are recoverable for the earlier evidence prepared with particular regard to the 2nd Anderson Affidavit. The Seed Hawk Defendants argued that the record clearly indicates that only portions of the earlier evidence were problematic and therefore costs are recoverable as these earlier affidavits were relevant and necessary as prepared. The trial judge, in considering the appropriate parameters for costs ultimately set out in the Costs Decision, was aware of outstanding issues of costs for matters such as expert affidavits. An example of such an interlocutory order is the one dated June 15, 2001 (hereafter the "Costs Thrown Away Decision") which he rendered during the break between the 1st Trial Portion in 2000 and the 2nd Trial Portion in 2001 and which addressed amendment of pleadings, the addition of the counterclaim, and other relief such as the introduction of the 2nd Supplemental Anderson Affidavit:
... [14] My reading of the proposed amendments satisfies me that they will permit the Court to decide the matters in issue between the parties. So the question becomes whether it is possible by the imposition of terms to remedy the prejudice to the plaintiffs caused by the amendments sought and the introduction of the various documents and the supplemental affidavit (which will be collectively referred to as "the relief sought") at this stage in the proceedings? The introduction of the various documents does not impact directly on Mr. Halford's evidence to the extent that they deal largely with the content of the expert evidence as to prior art. The plaintiffs' expert evidence has yet to be heard. An affidavit as to the significance of the documents as prior art is a matter which could be dealt with by an appropriate affidavit in reply, if it were thought necessary to do so. Similarly, to the extent that the proposed affidavit deals with the operation of a particular device, this too can be remedied by an appropriate affidavit in reply. The additional expense incurred in taking these steps is a matter for costs....
[21] The plaintiffs should also have their costs thrown away resulting from any step undertaken as a result of the granting of the relief sought by the Seed Hawk defendants from those defendants only in any event of the cause.
ORDER
For the reasons set out above, it is hereby ordered that:
1- The Seed Hawk defendants shall have leave to:
a) serve and file the Amended Statement of Defence in the form tendered at the hearing of this Motion, provided the document is served and filed before June 29, 2001;
b) serve and file an Amended Affidavit as to documents incorporating the documents identified in their Notice of Motion materials as well as the documents tendered on the hearing of this motion, providing the Amended Affidavit of Documents is served and filed prior to June 29, 2001;
c) serve and file a supplementary affidavit of Clifford J. Anderson in substantially the same form as the affidavit tendered at the hearing of this motion providing such affidavit is served and filed before June 29, 2001.
2- Simplot Canada Limited has leave to file its Amended Statement of Defence in the form of the Amended Statement of Defence attached to the Notice of Motion materials providing such amended Statement of Defence is served and filed before June 22, 2001.
3- The plaintiffs have leave to:
a) conduct examinations for discovery of a representative of the Seed Hawk defendants on any issue arising out of the Amended Statement of Defence or the Amended Affidavit of Documents providing such examinations are concluded prior to August 15, 2001;
b) conduct examinations for discovery of a representative of Simplot Canada Limited on any matter arising out of the Amended Statement of Defence of Simplot Canada Limited providing such examinations are completed prior to August 15, 2001;
c) file a reply responding to any issue arising out of the Amended Statement of Defence, providing such reply is filed prior to June 29, 2001;
d) file a supplemental affidavit responding to the supplementary affidavit of Clifford J. Anderson, providing that such affidavit is filed in compliance with Rule 279(b) of the Federal Court Rules, 1998.
4- Counsel for the plaintiffs and Mr. Halford are released from the order made at the trial of this matter, prohibiting any discussion of the evidence given by Mr. Halford until his re-examination had been completed.
5- The plaintiffs shall recover their reasonable costs thrown away as a result of any steps taken pursuant to this order in any event of the cause, such costs to be spoken to at the conclusion of the trial of this matter.
[62] The Seed Hawk Defendants argued that, in addition to his testimony on non-infringement, which also addressed issues of invalidity the costs for which are recoverable as part of the defence of non-infringement, Mr. Anderson's expertise was essential at trial and before to assist counsel in the analysis of adverse expert evidence, including being present during opening statements. A cursory look at his accounts could leave the impression of excessiveness, but that would gloss over the actual relevance of his work. For example, Mr. Blair's letter dated November 27, 2000 to Norbert Beaujot, forwarding Mr. Anderson's latest account, states that it addresses trial preparation (mainly to review the adverse expert opinions and to meet with counsel to prepare for his own testimony) and that he would not bill again for such work in the future. The inference to draw is that what in fact transpired is that the Plaintiffs were subsequently given permission to advance additional evidence in turn requiring additional work by Mr. Anderson in both areas, but not duplicating previous work and double charging for the same work.
[I interject to note that the Plaintiffs' counsel objected firmly to this last submission on the basis that the Seed Hawk Defendants' counsel was giving evidence to perfect omissions in the latter's evidence: as I usually do in the face of such objections, and the transcript of the hearing will so reflect several times, I cautioned counsel about the need to avoid straying into the area of giving evidence, but noted that some leeway was needed to achieve finality at this late stage of the litigation. My suggested practice, ie. that instead of counsel purporting to give evidence to fill in gaps in the record, counsel might invite me to draw inferences, should not be seen as a viable alternative to formal affidavit evidence because the likely result at assessment would be sharply reduced or nil allowances].
[63] The Seed Hawk Defendants argued that it was reasonable and necessary for Mr. Anderson to be present in court for both the qualification and the testimony of two of the Plaintiffs' experts (October 22 to 31, 2001, inclusive, of the 2nd Trial Portion in 2001). For example, the record discloses problems arising with Dr. Sylvio J. Tessier's evidence during that period: Mr. Anderson's presence was essential to react and adjust appropriately. Mr. Anderson was not required for the 2nd Trial Portion in 2001 after the conclusion of Dr. Tessier's testimony. Mr. Anderson's presence was essential on June 19 and 20, 2002, inclusive, in the 3rd Trial Portion in 2002 for the qualification and testimony of another of the Plaintiffs' experts. It was also reasonable to have him there a day or two in advance given the uncertainty of the scheduling or pace of witnesses. Although the Rule 279 provision for service well in advance of proposed expert evidence might suggest he need only have reviewed such materials beforehand, the ad hoc calculation being produced during Dr. Tessier's testimony is but one example of the necessity for Mr. Anderson's presence to provide expert technical assistance in the understanding and analysis of adverse expert evidence as it unfolded. His February 28, 2003 bill, disclosing travel to the trial venue one week before the resumption of the 4th Trial Portion in 2003, is an example of prudent use of his expertise, ie. to facilitate hearing preparation by meeting out of town counsel and other witnesses in the single location of the file and exhibits.
[64] The Seed Hawk Defendants noted for clarity that, although the Plaintiffs' actual assertion was duplication of work and costs, they concede that it is not proper, and Mr. Anderson was not so used here, to effectively circumvent the partial indemnity limitations of the tariff by assigning counsel work to non-counsel so that full costs for the latter are claimed. As for potential duplication, the Plaintiffs' assertions do not stand scrutiny. For example, Mr. Anderson's letter dated March 1, 2000, covering his February 28, 2000 invoice, states that he has "expended a large amount of time on this matter drafting and redrafting the affidavits and sifting through the documentation and this is reflected in the size of the account." The Plaintiffs cast this as duplication of Mr. Blair's work. However, the evidence actually indicates, relative to the entry in said invoice for preparation "of descriptions and drawings of Halford device, Seed Hawk device and Heinonen system", that the fruits of such work were in the 1st Anderson Affidavit, ie., such as an engineering drawing referred to in the Trial Decision.
The Plaintiffs' Position on Clifford Anderson
[65] The Plaintiffs argued that the claimed costs for Mr. Anderson are excessive, notwithstanding the difficulties and length of the proceedings, for a single affidavit of 27 pages and for testimony essentially equating to two days (part of June 28, 2002, all of February 3 and part of February 4, 2003), part of which was devoted to testing his qualifications as an expert. The evidentiary rulings affecting the Plaintiffs' expert evidence are not a factor because Mr. Anderson had made anticipatory changes to his evidence. That the trial judge attempted to control the length of hearing cannot somehow be used as justification for costs of evidence prepared, but not used. The trial judge did not discount Mr. Anderson's evidence entirely, but he did comment unfavourably on it several times, ie. paras. [303] - [304] concerning obviousness, after having given it a cool appraisal overall in the Trial Decision:
... THE EXPERTS
[23] Before embarking upon the construction of the patent, I wish to say a few words about my assessment of the evidence of the experts who testified before me on questions of infringement and invalidity, namely Dr. Tessier and Mr. Schaaf for the plaintiffs and Mr. Anderson for the Seed Hawk defendants. I found them all to be persons of intelligence and well qualified in their particular domains. However, to a greater or lesser degree, all approached the trial as though their function was to persuade me of their point of view, as though it mattered to them, one way or another, how I decided the case. In my view, it is the function of counsel, and counsel alone, to be persuasive. It is the function of an expert to be informative, to present information which is beyond the common experience of a layman in a well organized and coherent fashion so as to assist the trier of fact in making sense of the information. The nature of the litigation process is that the experts' evidence will be challenged by those who are adverse in interest. Experts are entitled to defend their positions; their evidence is of no use to a trier of fact unless they are able to defend it. But, it is not the function of experts to be partisan defenders of a position in the litigation, to tailor their evidence so that it most conforms to the position of the parties or their advisors. When they are employed in that fashion, the Court is left to make its own way through material which, by definition, is outside common experience.
[24] Mr. Anderson was cross-examined extensively as to his affidavit. He made a number of concessions which did not reflect well upon his evidence. He admitted two errors in the material he produced for the Court. He presented as his evidence information which was provided to him by Norbert Beaujot. He left the impression that he had observed certain operations when in fact he had not done so. He never did observe an entire Seed Hawk seeder in operation. None of this inspires confidence in his evidence. On the other hand, I found Mr. Anderson to be the least partisan of this group of witnesses.
[25] I found the evidence of Dr. Tessier and Mr. Schaaf problematic as well. In cross-examination, Dr. Tessier was forced to admit that he had made several errors in calculating the strength of the Seed Hawk seed knives (Transcript of Evidence, October 29, 2001, at p. 1693- 1699). When confronted by the possibility of an error in the application of a formula, Dr. Tessier refused to commit himself, retorting that he could not "answer to a suggestion" (Transcript, idem, at p. 1694-1695). When Dr. Tessier admitted his errors, he only did so with the greatest of reluctance. All of his errors advanced the position which he was advancing.
[26] Dr. Tessier appeared to be offended by the request that he produce his detailed calculations:...
Other examples, not exhaustive, of unfavourable comments in the Trial Decision, thereby warranting reduction of an excessive amount, are paras. [146] - [147] concerning positioning of the fertilizer knife, para. [152] concerning description of the invention and paras. [160] - [161] concerning the working depth of the fertilizer knife. Any such factoring down is additional to factoring down for invalidity, which the evidence indicates represented a significant portion of his work.
[66] The Plaintiffs argued that to now ask them to indemnify the Seek Hawk Defendants further to work performed, ie. the entire 2nd Anderson Affidavit, per improper instructions from counsel (Mr. Blair) fails miserably any threshold of reasonable necessity. Apart from that, the evidence indicates that counsel for the Seed Hawk Defendants (those counsel costs are not claimed as part of Mr. Anderson's account) actually prepared substantial portions of his affidavits. For example, the January 27 and March 30, 2000 invoices from Ogilvie and Company (Mr. Blair's firm) disclose several entries for counsel work on preparation of Mr. Anderson's evidence without however detailing the nature of the work. This work generally coincides with the initial swearing of the 1st Anderson Affidavit. There are several other such examples, ie. the November 30, 1999 and January 31, 2000 invoices from Armstrong Perkins Hudson (also Mr. Blair's firm). The sense of these and other invoices is repeated drafting and re-drafting of Mr. Anderson's affidavits, for which the Plaintiffs should not have to pay.
[67] The Plaintiffs argued that the evidence for Mr. Anderson's costs is unsatisfactory in that invoices generally consist simply of start and end dates coupled with a general description of the work done. For example, his April 30, 1999 invoice refers to "discussions" and "meeting" with Mr. Blair without disclosing the subject and reason for the meeting. As well, this invoice refers to a preliminary review of materials, detailed review and analysis of transcript evidence and preliminary review and analysis of prior art, all without disclosing the relevance of such work. The worst of its entries is "[O]ngoing consultation", which is simply too vague to support indemnification of litigation costs. This invoice claims $6,195.25 for his time from February 25 to April 30, 1999, without any details as to hourly rate, actual dates of work and how much time was dedicated to each task. These comments apply to all of Mr. Anderson's invoices, including their disbursements, ie. the July 29, 1999 invoice claiming $715.00 for airfare does not disclose details of destination, departure city, purpose, class of fare etc. This invoice indicates that Mr. Anderson, who is based in Edmonton, billed for his attendance at a farm show in Regina with Mr. Beaujot. The evidence does not refer to, much less establish, any bases which could justify requiring the Plaintiffs to indemnify such costs. The Plaintiffs conceded that there were instances of better detail, ie. " [D]etailed analysis of Halford patent and comparison to Seed Hawk machine" in the October 20, 1999 invoice. However, this invoice still lacks hourly charges and date breakdowns and contains the vague term "[O]ngoing consultations".
[68] The Plaintiffs argued that the comments in paras. [14] - [16] inclusive of Dableh, supra, (T.O.) lead to the general statement of principle of particular relevance here:
... ¶ 17 In the scheme of costs, the taxing party has more of an obligation than simply to accept and pay bills without some sort of preliminary filtering process i.e. breakdown of charges by purpose, rates, hours etcetera. For $28,890.00 in the scheme of costs, I expect to see more than exhibit B to the Mills affidavit. It may be that said exhibit was a cover page for a detailed summary: there was no evidence before me. Defendant may not have wanted to come to Court but that did not divest it or its solicitor of certain responsibilities for proof. My Reasons supra indicate that I consider zero dollars at taxation an absurd result when it was obvious that at least some dollars were necessarily spent. They do not suggest that a one line invoice, as presented here, necessarily establishes an absolute right to indemnification of the amount presented. Assessing reasonableness becomes difficult when faced with an account of the type before me and given entrenched and divergent views on the record. The Mills affidavit, in its body, could easily have obviated reliance on exhibit 1-TAX. Defendant may not have been able to predict exactly what form Plaintiff's objections would assume but, in my experience, the latter represent nothing new or startling in the process of taxation. Experts' accounts are often inviting targets because they noticeably exceed other items in Bills of Costs. The dollars taxed off for Dr. Laithwaite were not punitive in the sense of a penalty for deficiency of proof but simply a measure of the extent to which I could exercise discretion to compensate for the deficiency and still achieve the most realistic indemnification in the circumstances of this action. The single line in exhibit B is not a very good point from which to start. Judgment was reserved on June 15, 1992. Dr. Laithwaite at least provided a count of the number of days charged. Dr. Lavers' account claims up to July, 1992: the evidence does not disclose if his normal billing process named months as opposed to partial months or whether his account indeed addressed the latter part of June, 1992 during which this matter was under reserve. I accept Defendant's submission that certain technical expertise in the nature of a consultant was appropriate. I examined his Curriculum Vitae. I allow $17,000.00 + $1,190.00 GST = $18,190.00....
The complete lack of information here precludes confirmation that $145,981.45 meets the threshold of austerity for costs.
[69] The Plaintiffs argued that another area of concern for Mr. Anderson's account is the unnecessary amount of time that he spent in Court when not testifying. The Plaintiffs concede the principle in the jurisprudence that counsel may use experts, for which associated costs are recoverable, for the latter's time in giving expert technical assistance, including time in the courtroom for consultation, but the attempted recovery here is unreasonable. For example, Mr. Anderson was present during the 1st Trial Portion in 2000 for opening statements, Mr. Halford's testimony and the unfortunate circumstances of adjournment, for none of which counsel required expert technical assistance. His November 30, 2001 invoice claims for attendance during the 2nd Trial Portion in 2001 on October 9 to12 inclusive, 15 to 17 inclusive and 23 to 30 inclusive, although the trial was not in session on October 9 to 12, and October 27 and 28 are weekend dates. He did not testify in this trial portion. This invoice does not attempt or provide an explanation or justification for any of this.
[70] His July 3, 2002 invoice charges $23,556.25 for his time, plus disbursements, under cover of the vague entry: preparation for trial and attendance at trial in Winnipeg on June 12 to 28, 2002. Again, this includes non-trial dates and weekends without specifying hourly rates or how his charges were calculated. He was not called to the stand until June 28, the final day of the 3rd Trial Portion in 2002. All of this is far beyond the extent of indemnification for expert technical assistance contemplated in the jurisprudence. The 4th Trial Portion in 2003 did not start until February 3, 2003, but his February 28, 2003 invoice shows charges for his attendance at trial from January 27 to February 4, 2003, including weekends. Preparation time is still claimed at this late date notwithstanding such claims stretching back several years. All of this is without details permitting any objective gauge of reasonable necessity and whether his work strayed into the realm of the professional responsibility of counsel, the latter being limited by the principle of partial indemnity.
[71] The Plaintiffs argued that Mr. Blair's November 27, 2000 letter to the client covering Mr. Anderson's November 22 invoice illustrates the difficulties in accepting the extent of Mr. Anderson's account. The letter is brief, but twice asserts that Mr. Anderson has completed his trial preparation and will not have to repeat that work nor bill again for it. Yet, there ensues a recurring pattern in his subsequent invoices of more trial preparation, without any underlying details, most of which occurs when there is no realistic chance of him getting on the stand.
[72] The Plaintiffs noted generally that Mr. Anderson charged for 16 days of trial attendance which were not actual trial session days, before the trial had started or resumed. He charged for 22 trial session days, including four weekend days, on which he was not testifying. His actual testimony, over three different days but essentially equating to two days (including time spent to establish his credentials), leads to a ratio of about 14:1 for days not testifying to days testifying. The ratio is 21:1 if one deems two days of actual testimony. This is all over and above the excessive charges already noted for preparation. Mr. Anderson is not "pre-eminent" in his field as that term is used in para. [20] of Apotex Inc., supra, but his charges reflect that status and are excessive in the sense of the Court's criticism in that case and in Dableh, supra (T.O.) with regard to the lack of details of purpose, hourly rates, number of hours, etc. Two case notes in Federal Court Practice 2005, supra, at p. 861 reinforce this argument. First, Rothman, Benson & Hedges Inc. v. Imperial Tobacco Ltd./Ltée (1993), 50 C.P.R. (3d) 59 (F.C.T.D.), holding that the "costs of a witness should not be disallowed unless the party could not have reasonably considered the witness' evidence to be relevant to and supportive of the case," applies here in the circumstances of two of four of Mr. Anderson's affidavits, ie. one that was irrelevant as a function of erroneous instructions from supervising counsel and one acknowledged to be inaccurate. Second, Carruthers v. The Queen, [1983] 2 F.C. 350 (F.C.T.D.), holding that the "fact that an expert's report is rejected or not accepted in full in the trial judge's reasoning does not justify a refusal of the expert's costs, unless the Court finds that the expert's report was unnecessary or useless," could be applied to these two affidavits and as well to the 1st Anderson Affidavit which, if not wholly rejected, did not receive much of an endorsement from the trial judge.
[73] Contrary to the Seed Hawk Defendants' assertion, evidentiary rulings had nothing to do with the decision to not use certain expert evidence for which costs are claimed. The 2nd Supplemental Anderson Affidavit was the only one that might conceivably have been entered at trial in addition to the 1st Anderson Affidavit. It addressed invalidity and for that reason alone cannot support a claim here for costs (as noted earlier, the detailed evidence and argument in the record on issues of invalidity as a factor for costs are only briefly summarized throughout these reasons because of my findings in favour of the Seed Hawk Defendants on invalidity).
[74] The Plaintiffs argued generally that the Seed Hawk Defendants' attempt to highlight Mr. Anderson's role in assessing voluminous expert materials from the Plaintiffs is undercut by the reality that at least three of the Plaintiffs' expert affidavits were in response to his expert evidence. Overall, the weakness of his impact on the outcome, disproportionate charges relative to actual duration of his testimony and lack of details of the purpose and manner of calculation of his charges, including disbursements, mandate a significant discounting of his account.
Assessment of Clifford Anderson's Account
[75] This account, as are several of the items of costs immediately following, is located in the Seed Hawk Defendants' Bill of Costs totalling $713,566.26 + taxes and addressing the bulk of the litigation. The parties had agreed before me to move about somewhat among the various bills of costs to first address the larger and generally more contentious items with the hope that their submissions thereon could later be used, where applicable, for smaller items to facilitate the assessment hearing. As I noted earlier, given the significant bulk of materials in the record coupled with the transcript of the hearing before me, these reasons do not approach a complete account of every nuance of the parties' respective positions, notwithstanding that I have read and considered everything as part of my deliberations.
[76] Mr. Anderson's account was another subject of my "without prejudice" opinions on June 27, 2005. At that time, I indicated some concerns about his charges and an inclination to reduce them, while keeping in mind the parameters of the Costs Decision and of the effect of certain interlocutory events on the manner in which this litigation proceeded and on the assessment of costs. As well, I speculated that the unfortunate circumstances of the withdrawal of initial counsel for the Seed Hawk Defendants were not directly responsible for a shift in certain elements of the latter's defence strategy, but that said change of counsel likely created the environment for a shift in strategy. I indicated that the Plaintiffs should not bear costs, if any, associated with Mr. Anderson possibly having to revisit his work as a result of the engagement of new counsel at a very advanced stage of the litigation. To clarify, I did not mean additional work performed to conform to new elements of the defence strategy.
Rather, I simply meant that the Plaintiffs should not have to pay for unnecessary review of existing work. Further, if I do allow costs for remedial work under the supervision of incoming counsel, I would likely discount charges for some existing work.
[77] I expressed concerns about duplication of work and work straying into the area of counsel's responsibility, but confirmed that costs can be claimed for the expert technical assistance in case preparation as it relates to other experts, and then during trial, all subject to what is reasonably necessary. I reiterated my view, often expressed further to my approach in Carlile v. Her Majesty the Queen (1997), 97 D.T.C. 5284 (T.O.) and the sentiment of Lord Justice Russell in Re Eastwood (deceased) (1974), 3 All. E.R. 603 at 608, that assessment of costs is "rough justice, in the sense of being compounded of much sensible approximation", that discretion may be applied to sort out a reasonable result for costs equitable for both sides. I think that my view is reinforced by the editorial comments (see: The Honourable James J. Carthy, W.A. Derry Millar & Jeffrey G. Gowan, Ontario Annual Practice 2005-2006 (Aurora, Ont.: Canada Law Book, 2005)) for Rules 57 and 58 to the effect that an assessment of costs is more of an art form than an application of rules and principles as a function of the general weight and feel of the file and issues and of the judgment and experience of the assessment officer faced with the difficult task of balancing the effect of what could be several subjective and objective factors.
[78] I indicated that, although the trial judge may not have commented favourably on all aspects of the experts, I believed that experts such as Mr. Anderson were essential and prudent for the outcome. That is not to disparage the Plaintiffs' experts or their use by the Plaintiffs' counsel. As discussed in Carlile, supra, the threshold of proof in civil litigation is not a function of absolutes, recognizing that counsel must exercise professional discretion in shaping their respective client's cases. A civilized society includes vehicles such as courts for the orderly resolution of legal disputes. No one asks to be sued, but if one sues or is sued, there may be associated inconveniences as a function of the privileges of society, ie. costs.
[79] The Plaintiffs here had every right to assert what was, in their minds, a valid cause of action. They must however bear the consequences of a lack of success. On the other hand, the Defendants, although successful in their right to resist the Plaintiffs' allegations, must bear the consequences of unwanted expenditures which are outside the reasonable limits necessary for a successful defence even if caused by no other reason than the Plaintiffs' assertion, via this litigation, of certain perceived rights. I commented that all litigants here were well served by their professional legal representatives, but that I felt that the particular circumstances here may have inadvertently introduced factors which should work to reduce Mr. Anderson's account. I have assessed Mr. Anderson's account consistent with my approach in Merck & Co. Inc. et al. v. Apotex Inc., [2002] F.C.J. No. 1116 (A.O.) affirmed by [2002] F.C.J. No. 1357 (F.C.T.D.) and Bayer A.G. et al. v. Apotex Inc. et al., [2002] F.C.J. No. 1693 (A.O.). I take the Plaintiffs' point on the vagueness of some entries and I will cut accordingly. However, I think that this was a difficult and at times disjointed piece of litigation and that counsel for the Seed Hawk Defendants had an ongoing need for expert technical assistance, in addition to Mr. Anderson's production of his own expert report. There however are limits.
[80] I do not accept the general sense of the Seed Hawk Defendants' assertions that conclusions in the Costs Decision concerning conduct and preparation of evidence preclude me from reducing Mr. Anderson's account as a function of reasonable necessity. This applies as well to the caveat in the Costs Decision that assessed costs are not to be reduced as a function of any allegation of misconduct. I think that circumstances of misconduct stand separate and feature different elements as factors for costs than do the decisions by experienced professional counsel acting in the best interests of their client in the face of the circumstances existing at the time said decisions were made to incur disbursements for services such as experts. My first inclination was to simply reduce the $145,981.45 to some global amount that I felt this litigation warranted. I think that such a lump sum approach is possible depending on the circumstances, but not here. I addressed each invoice in turn keeping in mind the timing of events, including those relating to expert materials from both sides. I do not think that the Plaintiffs should have to pay for the 3rd Supplemental Anderson Affidavit. I find that his evidence does not clearly break out the charges associated with this affidavit and I have therefore reduced costs accordingly using my best estimates consistent with the sense of austerity that should pervade costs.
[81] His April 30, 1999 invoice ($6,191.25 fees + $251.75 disbursements + $451.01 GST for the period February 25 to April 30, 1999) addresses work about one year prior to the initial swearing of the 1st Anderson Affidavit. Here and throughout, general descriptions only are used for discussions and meetings with the client and with counsel, ie. "preliminary", "preliminary review" and "ongoing consultations". Mr. Anderson is a professional and I am sure this work was case-related. However, the lack of detail makes assessment difficult and requires more reliance on my experience and discretion. The reference to "Transcript evidence" might address discoveries. There is one line giving some detail, ie. "preliminary review and analysis of prior art", however without specifying the parameters or amount of time required. This is a pattern throughout which I do not necessarily summarize for the invoices following, although apparent from the record. My analysis in Bill of Costs and Assessment, 2003, supra essentially asserts that the principle of partial indemnity is generally captured in court tariffs, as in the Federal Court, relative to counsel fees, but indemnity for disbursements is generally governed by reasonable necessity, meaning that full indemnity is a possibility. This latter proposition is not absolute and embodies some imprecision in pegging an exact and appropriate amount, and by which supervising counsel should not be unduly criticized in hindsight if the assessed amount is less than what supervising counsel authorized. I allow $5,500.00 (here and below for Mr. Anderson, the assessed amount is inclusive of disbursements and taxes).
[82] His July 29, 1999 invoice ($4,755.00 fees + $784.92 disbursements + $387.79 GST for the period May 1 to July 29, 1999) is covered by a letter from counsel explaining the airfare itinerary. The attendance at a farm show with Mr. Beaujot presumably is research. The record discloses that Mr. Anderson was not specifically experienced in this field, but was qualified to testify on certain applications relevant therein. I think that experts necessarily perform some preliminary research for a new project to ensure the correct approach is used. Costs may be claimed for such work, but not for an extensive education in what may be a new field of expertise. The line noting review of the new statement of claim makes some sense in the context of ascertaining the parameters of the expert opinion required, but the continuing lack of detail of hours devoted, rate used or scope of the review makes it difficult both to gauge whether the charges were reasonable and whether this work strayed into the realm of supervising counsel. I do not intend to dwell on whether subsequent supervising counsel brought better focus, within the specialized areas of intellectual property litigation, to this expert's work, but I have in mind throughout that the losing party should not have to indemnify costs associated with faulty instructions leading to unnecessary work. I allow $3,500.00.
[83] His October 20, 199 invoice ($10,385.00 fees + $175.90 disbursements + $739.26 GST for the period July 30 to October 20, 1999), although still using general language for meetings with counsel, does provide some details of tasks without however specifying hours and rate. I note with interest the correct parameters for comparison of the subject patent to the Seed Hawk machine. I allow $10,700.00. His February 28, 2000 invoice ($21,615 fees + $724.61 disbursements + $1,563.77 GST for the period October 21, 1999 to February 28, 2000) includes finalization of the 1st Anderson Affidavit. His covering letter to supervising counsel refers to the need to devise a strategy for testing the Plaintiffs' expert evidence and also notes that most of the pre-hearing work is complete. I allow $19,000.00.
[84] His August 16, 2000 invoice ($8,076.25 fees + $1,342.12 disbursements + $659.29 GST for the period February 29 to August 16, 2000) includes charges for the 2nd Anderson Affidavit. The affidavit of Irene Bridger sworn May 8, 2001, preceding the Costs Thrown Away Decision permitting the 2nd Supplemental Anderson Affidavit, refers at para. 27 to problems with "Mr. Anderson's existing affidavit evidence" as a function of faulty instructions from counsel. I am trying to take that into consideration to this point via certain discounting of his accounts. This invoice includes work on the adverse expert evidence. I allow $7,100.00.
[85] His invoice dated November 22, 2000 ($14,480.00 fees + $1,836.05 disbursements + $1,142.12 GST for the period August 17 to November 22, 2000) includes trial preparation, review of transcripts and travel costs for the 1st Trial Portion in 2000. My review of the record does not disclose parallel court proceedings. The transcript might address discovery. It is not clear whether this is more properly counsel work. Unlike subsequent invoices, he does not break out actual attendance dates at the Winnipeg venue. It is sometimes difficult to ascertain the point at which supervising counsel required expert assistance in the analysis of technical issues. I would not think, from my reading of the Plaintiffs' expert reports, that Mr. Blair could have evaluated them without expert technical assistance. I have no doubts concerning Mr. Anderson's professionalism, but his credentials were not wholly accepted in this field. I am not convinced, given the amount of work to that point, that his presence in Winnipeg from the first day of trial was warranted, even if counsel intended last minute preparation for Mr. Anderson's own evidence. I allow $12,200.00.
[86] His invoice dated May 31, 2001 ($3,722.50 fees + $260.58 GST for the period November 23, 2000 to May 31, 2001) is vague, but likely he was proceeding on fresh instructions from incoming counsel. I allow $3,983.08 as presented. His invoice dated June 26, 2001 ($6,863.75 fees + $14.08 disbursements + $481.45 GST for the period June 1 to June 26, 2001) continues work during the adjournment between the 1st Trial Portion in 2000 and the 2nd Trial Portion in 2002. It includes work on potential evidence of prior art from the Scandinavian Witnesses and finalization of the 2nd Supplemental Anderson Affidavit (see the conclusions below: the associated costs for the latter are not precluded by the Costs Thrown Away Decision). I allow $7,359.28 as presented. My allowances included a consideration of whether there should be any further discounting, either above or for these latter two invoices, for unnecessary costs associated with possible shifts in the defence strategy as a function of incoming counsel. His invoice dated September 28, 2001 ($9,282.50 fees + $41.56 disbursements + $652.68 GST for the period June 27 to September 28, 2001) used general language. There is no reference at all to the 3rd Supplemental Anderson Affidavit prepared at this time, meaning that perhaps he did not charge for it. I am not comfortable with a substantial allowance for this invoice and I allow only $5,600.00.
[87] His November 30, 2001 invoice ($25,037.50 fees + $1,847.01 disbursements + $1,881.92 GST) includes further preparation for trial. I accept the decision of supervising counsel to use his technical expertise as the Plaintiffs' expert evidence unfolded. As well, I recognize that gauging the pace of evidence, in terms of anticipating the precise point at which a witness such as Mr. Anderson might be called, is not an absolute science. I am reluctant to second guess the very experienced counsel for the Seed Hawk Defendants at this point in what can be inadequately described as difficult litigation, but I am not convinced, given all that had occurred, that Mr. Anderson's presence was necessary for Mr. Halford's fresh testimony. This is all simply to say that I reject part of the Plaintiffs' position concerning the necessity of Mr. Anderson's presence in Winnipeg at this point. I accept that the Seed Hawk Defendants' counsel needed his assistance in evaluating evidence, in addition to his own testimony, and that counsel would require last-minute preparation for the latter. However, I think that experienced counsel could have estimated Mr. Halford's testimony as likely to occupy a couple of days. The continued lack of an hourly rate makes it difficult to determine a number of hours or days to discount. I would expect a professional at times to work on a weekend and charge for that time, but I do not think that those circumstances existed here. The travel disbursements, as elsewhere, exclude hotels and meals because those items were part of an omnibus charge negotiated in a separate claim. I allow $23,600.00.
[88] His invoice dated July 3, 2002 ($23,556.25 fees + $254.92 disbursements + $1,666.78 GST for the period December 1, 2001 to July 3, 2002) includes the 3rd Trial Portion in 2002. Again, I think it prudent for him to have attended to provide expert technical assistance, but in these circumstances, not so far in advance of the start of this trial portion given the experience of counsel. I allow $20,500.00. His invoice dated February 28, 2003 ($20,891.25 fees + $565.28 disbursements + $1,501.96 GST for the period July 4, 2002 to February 28, 2003) includes more trial preparation and his testimony at trial. I have difficulty with bringing him to Winnipeg, after all that has occurred, one week in advance of the 4th Trial Portion in 2003. Again, the lack of details of hours or rates makes discounting difficult. The bill of costs claims only $5,075.58, which I allow.
[89] In addition to the claims for these invoices, which I have assessed for a total allowance of $123,317.94, there is a claim of $4,438.90 for travel costs associated with airfare, hotels, meals, local and long distance telephone calls. Although the evidence clearly confirms that the $435.43 claimed in the bill of costs is for his airfare relative to the 3rd Trial Portion in 2002, it is not nearly as clear whether the balance of the $4,438.90 is attributable to said trial portion or to other trial portions. The Plaintiffs had specific concerns with hotel rates below, which I have resolved. For Mr. Anderson, I simply considered a reasonable living expense for the periods for which I think his presence was essential at the trial venue. For that purpose, I accepted his presence for matters of prior art, ie. as for the Scandinavian Witnesses. I reduce the $4,438.90 claimed to an approved allowance of $3,200.00.
Disbursements of $59,638.65 ($55,741.81 total + $3,896.84 GST) to law firm of Pitblado Buchwald Asper in Winnipeg for office space, computers, secretarial assistance and legal research for the latter three trial portions
The Seed Hawk Defendants' Position
[90] The Seed Hawk Defendants relied on the affidavit of Pat Beaujot sworn February 2, 2005 (hereafter the "Beaujot Affidavit"):
... 110. As this trial was conducted in Winnipeg, which was not the place of business for the Seed Hawk Defendants' counsel, for the first attendance at trial in November 6 to November 9, 2001, the only office space for counsel to work in was the hotel.
111. This was recognized, after the adjournment of the trial on November 8, 2000, due to the incapacity of Mr. Blair, as highly unsatisfactory.
112. In particular, after discussions with Mr. Macklin and Mr.Horne, it was felt that for Seed Hawk counsel to have ready access to two boardrooms as a counsel work area, easy access to a good law library, Quicklaw computer reference searching, word processing computers, printers, stationery, secretarial services, photocopying, and binding services, as well as readily accessible video viewing equipment, all of which were in fact used by Seed Hawk counsel in conducting the Seed Hawk Defendants' defence, it was necessary to obtain the agreement of a law firm permitting use of these facilities.
113. Gowlings, with my approval, obtained agreement with the Pitblado firm in Winnipeg to utilize the premises, law library, staff, two boardrooms, secretarial services, photocopying, binding and word processing equipment of the Pitblado firm, with the agreement to make available a (at that time) 3rd year lawyer, Ms. Elsy Gagne, to co-ordinate and assist with legal research, motion preparation, and other various legal tasks.
114. In this regard, attached as Exhibit "T" to my Affidavit are a series of invoices received from the Pitblado firm, for services rendered, including disbursements and use of the premises, in the amounts of $169.08, $4,692.85, $21,777.00, $14,916.00, $1,889.04 and $11,802.84 (amounts excluding G.S.T.). I am informed by Doak Horne and verily believe as follows:
(a) The first invoice, in the amount of $169.08,relates to the Pitblado firm obtaining and forwarding to Mr. Horne, copies of the pleadings then on file in this matter from the Federal Court in Winnipeg.
(b) The second invoice, in the amount of $4,692.85, relates to disbursements incurred by the Pitblado firm on behalf of the Seed Hawk Defendants during the presence of Gowlings' solicitors, witnesses and potential witnesses and party litigants (myself and Norbert Beaujot) at the Pitblado premises, over the period October 5 to November 2, 2001.
(c) The third invoice, in the amount of $21,777.00, relates to services rendered by Elsy Gagne and various support staff and paralegals of the Pitblado firm in assisting Gowlings' lawyers with responding to, and bringing, a number of motions before the Court during this particular period, including obtaining the services of a Finnish translator when it was believed that Dr. Reijo Heinonen would be called as a witness.
(d) After a number of motions had been argued during the Court attendance from October 15 to November 2, 2001, it was felt that upon the next attendance, it would be less costly, and more economical, if the Seed Hawk Defendants negotiated a flat rate for the use of the Pitblado premises, equipment, staff, and secretarial services.
(e) Accordingly, a flat-rate of $15,000 was negotiated with the Pitblado firm, separate from disbursements, for the next attendance in Winnipeg in June 2002. Accordingly, I am informed by Doak Horne and verily believe that the fourth invoice, in the amount of $14,916.00, relates to the use of the Pitblado premises during the third court attendance in Winnipeg in June 2002 for the flat rate of $15,000.
(f) The fifth invoice, in the amount of $1,889.04, relates to disbursements incurred by the Pitblado firm on behalf of the Seed Hawk Defendants during the attendance in Winnipeg in June 2002.
(g) For the last three (3) week attendance in Winnipeg in January to February, 2003, I am informed by Doak Horne and verily believe that a flat rate of $7,500 was negotiated with the Pitblado firm for use of their premises, separate from any disbursements and legal or secretarial assistance. Accordingly, the last Pitblado invoice in the amount of $11,802.84 was rendered, of which $7,500 related to the flat rate for the premises/equipment rental, with the remainder pertaining to various other disbursements such as courier, Quicklaw searches, stationery and secretarial overtime in typing the Seed Hawk Defendants' Written Submissions (at least in part). A $495 fee was charged for legal services of Elsy Gagne who researched case law for use in support of the Seed Hawk Defendants' written submissions, which were filed with the Court....
The first contract was based on compensation for the time of Elsy Gagne, as opposed to a straight rental of premises. The evidence indicates modifications from that approach, as the trial unfolded, to a rate for premises, office machines, secretarial assistance etc. apart from charges for her professional time. The suggested use of a hotel room does not resolve problems of access to computer-assisted research, secretarial assistance etc. The assessment officer should exercise discretion here to recognize the real demands of this litigation, ie. the trial judge's request for written submissions to be prepared and delivered on weeknights or weekends to his hotel during the trial.
The Plaintiffs' Position
[91] The Plaintiffs characterized this disbursement as effectively full indemnity circumventing both the limitations in the Costs Decision for senior and junior counsel and the partial indemnity limitations of the tariff. The details in the invoices are exactly what would be found in a lawyer's professional bill to the client. There is no precedent for rental of premises, particularly at such elevated rates. Counsel for the Simplot Defendant managed quite nicely with his single hotel room. It is simply unreasonable to charge for 53 days' use of premises for 36 days of trial, particularly in the absence of economies of approach, ie. less expensive boardrooms or hotel space. If something is to be allowed and the invoices are used as a starting point, some $38,000.00 should come off the top for a lawyer's professional work in the nature of legal services circumventing the partial indemnity limits of the tariff and of the Costs Decision.
Assessment
[92] I stand on my without prejudice comments on June 27, 2005, ie. that my feeling is that the particular circumstances of this litigation warranted some sort of working room, but something less than the full arsenal afforded by a law firm's set-up. I am well aware of overhead issues, such as secretarial assistance, raised at assessments over the years. As well, I emphasize that I do not think that the pragmatic arrangements here constituted a device to circumvent tariff limitations for the work of counsel, but the Seed Hawk Defendants did benefit indirectly in that area indirectly via the work of Ms. Gagne, apart from access to a working space and associated tools, such as photocopiers. As well, there were perhaps unintended excesses such as reflected in the November 30, 2000 invoice, ie. $180.92 (which included Ms. Gagne's time) simply to obtain documents from the Federal Court Registry (a national court with offices providing access in every jurisdiction). There likely were less desirable options other than a law firm, ie. an extra hotel room or two with rented photocopiers etc. I allow $13,000.00 inclusive of taxes. That allowance reflects overhead considerations, set-up time and my feeling for what should be a minimalist approach with a view to the sense of austerity which should pervade costs. As well, I am not conceding that such work areas are the norm in all instances of litigation. Paragraph [18] in Chua v. Canada (Minister of National Revenue - M.N.R.), [2002] F.C.J. No. 209 (A.O.) confirms that circumstances do exist for indemnification of counsel work outside the partial indemnity restrictions of the tariff.
Disbursements to Ake Huhtapalo of $23,600.00 contractual expenses to secure his attendance as a fact witness on prior art (invalidity) in the 2nd Trial Portion in 2001 and in the 3rd Trial Portion in 2002; of $7,913.41 ($7,395.72 fees + $517.69 GST) research work in 2001 and of $6,328.60 (inclusive PST and GST) travel expenses (airfare 3rd Trial Portion in 2002, hotels, meal, local and long distance calls and laundry)
Disbursements to Dr. Reijo Heinonen of $10,000.00 expenses to secure his attendance as a fact witness on prior art (invalidity) in the 2nd Trial Portion in 2001 and of $12,393.92 (inclusive of PST and GST) travel expenses (similar categories as for Ake Huhtapalo, except that Mr. Huhtapalo's airfare for the 2nd Trial Portion in 2001 is included)
The Seed Hawk Defendants' Position on Ake Huhtapalo and Dr. Reijo Heinonen (hereafter the "Scandinavian Witnesses")
[93] The Seed Hawk Defendants relied on the Beaujot affidavit:
....52. In addition to Norbert Beaujot and myself testifying as individual named defendants in this action, additional witnesses having information regarding the extent of public use of various prior art devices was necessary to be presented at trial.
53. In this regard, I am informed by my counsel Mr. Horne and verily believe that evidence of prior public use of earlier devices was submitted and was for the purpose of not only supporting Seed Hawk Defendants' claim of invalidity of claims of the patent in suit in view of such prior public uses, but was further necessary to be presented to assist the Court in assessing the state of the prior art and general knowledge in the industry it so as to be able to understand what a person skilled in the relevant art, at the relevant date, when reading the patent specification, would understand the invention to extend to and would read the claims to mean.
54. In other words, I am informed and verily believe that such factual evidence was necessary and brought before the Court via a number of fact witnesses on behalf of the Seed Hawk Defendants for the purpose of establishing that if the claims of the patent were construed as broadly as suggested by the Plaintiffs, then they were invalid for encompassing prior art, and if they were construed more narrowly so as to not include the prior art, then the Seed Hawk Defendants did not infringe such claims of the Patent. (Ultimately, it was the latter that was held by the trial judge).
55. In this regard, a number of fact witnesses were brought to Winnipeg, for the purposes of testifying in this regard. They were as follows:
(a) Ake Huhtapalo, who resides in Kristianstad, Sweden, who was a former researcher with the Swedish University of Agricultural Sciences, in the Department of Soil Sciences from 1965 to 1978. Thereafter he was employed by a Swedish farm equipment manufacturer (Overum AB) as a product manager for the division of such company that manufactured combined seeder/fertilizer devices ("combi-drills"). Mr. Huhtapalo testified regarding the construction of and the operation of a number of seeder/fertilizer devices in Sweden, including the Kamel, the Type 2, and the Viktoria model. Mr. Huhtapalo also identified various publications in respect of such devices, and described personal slides showing the various devices in operation. Mr. Huhtapalo also produced for the court a "home video" showing the Viktoria device in operation, which was viewed by the Court. Mr. Huhtapalo testified in Court on a number of separate occasions, namely October 31 and November 1 & 2, 2001, and due to inability to complete his testimony at that time, needed to again attend in Winnipeg from Sweden and testify at the recommencement of the trial on June 17 & 18, 2002 (see below).
(b) Dr. Ken Domier, of Edmonton, was a professor in Agricultural Engineering at the University of Alberta. Dr. Domier completed a year sabbatical at the Swedish University in Uppsala, where he met Dr. Heinonen and became interested in his work. Dr. Domier, due to his ability to communicate in Swedish, was responsible for arranging for Dr. Heinonen to come to Canada in 1978 to present and discuss his paper "Fertilizer Placement for Small Grains" to groups of 20-30 interested persons in each of Winnipeg, Saskatoon, and Edmonton. Dr. Domier was present at the presentation made in Edmonton by Dr. Heinonen in 1978. Dr. Domier described the presentation and identified the paper which was printed and freely distributed at such presentation. Dr. Domier attended twice at the trial, a first time during the period October 15-November 2, 2001, where due to time limitations he was not able to testify, necessitating his re-attendance at the trial during the period June 17-28, where he testified for one day, and thereafter returned to Edmonton.
(c) Dr. Reijo Heinonen, who resides in Helsinki, Finland, was brought to Winnipeg to testify regarding his presentation of a paper in Edmonton, Saskatoon, and Winnipeg authored by him and Mr. Huhtapalo, and to discuss and identify photographs of the prior art "Viktoria" device shown at the presentation of such paper....
The Beaujot Affidavit then sets out more details of the work, travel and charges for these fact witnesses, ie. such as the extra leg of airfare requiring to reach a hub city in Europe for the ongoing flight to Canada.
[94] The Seed Hawk Defendants noted evidence that, due to the Plaintiffs not having completed their case in the 2nd Trial Portion in 2001, Dr. Heinonen was unable to testify. The intent was to call him upon resumption of the trial, but ultimately, due to his advanced age, hearing difficulties and cost considerations, he was not brought back to Canada. The Scandinavian Witnesses were brought to Canada one week prior to commencement of the 2nd Trial Portion in 2001 to permit counsel to meet with them to prepare for their testimony. Both spent 26 days in Winnipeg at that time. Mr. Huhtapalo did not complete his testimony which began on October 31, 2001, but completed it in two days at the beginning of the 3rd Trial Portion in 2002. The Scandinavian Witnesses would not come to Canada to testify unless they were compensated for their time (the payments of $23,600.00 and $10,000.00 respectively for Mr. Huhtapalo and Dr. Heinonen). They were beyond the jurisdiction of a subpeona.
[95] Alexander Macklin, Q.C. and D. Doak Horne, counsel for the Seed Hawk Defendants, travelled from Canada in late February 2001 to meet first with Mr. Huhtapalo and a Professor Hakansson in Sweden to discuss potential prior art evidence. They then went on to Finland to meet with Dr. Heinonen for the same purpose. Mr. Huhtapalo charged $1,349.82 for his time and disbursements. Professor Hakansson also charged for his research and meeting time, ie. $891.57. As a result of the meeting in Sweden, counsel engaged Mr. Huhtapalo for additional research, leading to another invoice in September 2001 for $5,025.90. Mr. Huhtapalo was also consulted during the construction of scale models for the Viktoria and the Kamelin prior art devices to be used in the 2nd Trial Portion in 2001, for which he rendered an invoice for $1,020.00. The chronology for those latter pieces of work is significant, ie. coincident with the seeking and granting of the relief in the Costs Thrown Away Decision. Tariff B1(e) of the Court of Queen's Bench Rules (Manitoba) provides for recovery of reasonable costs associated with preparation of a model, videotape, film or photograph reasonably necessary for conduct of a proceeding and, even if that provision cannot be incorporated by reference, the wording of Tariff B1(4) for the Federal Court is general enough to permit recovery of such costs.
[96] The Seed Hawk Defendants noted that Steven Z. Raber, counsel for the Plaintiffs, had arranged to meet Mr. Huhtapalo on September 6, 2001, in Copenhagen, Denmark, and Dr. Heinonen on September 8 in Helsinki, Finland. The Scandinavian Witnesses asked Mr. Horne to attend, and so informed Mr. Raber on September 1. As such, when Mr. Raber and Mr. Horne were together on September 4, 2001 in Calgary for further discoveries, Mr. Raber was aware that Mr. Horne was to attend, but he did not mention to Mr. Horne whatsoever at that time that he intended to cancel his meeting with the Scandinavian Witnesses. It was not until after Mr. Horne had left on September 5 for Europe that Mr. Raber called Mr. Huhtapalo to cancel and propose meeting another time. Nothing was done to forestall Mr. Horne's departure. Mr. Horne salvaged the trip with meetings with Mr. Huhtapalo and several other potential witnesses. Mr. Horne subsequently complained, by letter, to Mr. Raber about this occurrence and emphasized that counsel for the Seed Hawk Defendants had not, would not and could not interfere in any fashion with Mr. Raber's access to the Scandinavian Witnesses. The bill of costs includes a claim for this trip.
[97] When counsel realized during the 2nd Trial Portion in 2001 that time might run out, the Seed Hawk Defendants moved for leave to call one of the Scandinavian Witnesses out of order, ie. before the Plaintiffs had finished putting in their case, to avoid having to bring them back to Canada. Leave was granted on the condition that the Seed Hawk Defendants pay for the return airfare for Dr. Harry Ukrainetz, one of the Plaintiffs' witnesses, to come again to Winnipeg in the 3rd Trial Portion in 2002. The Seed Hawk Defendants claim $605.08 for Dr. Ukrainetz's travel expenses for June 2002. As it happened, there was still not enough time for Mr. Huhtapalo to complete his testimony and he had to return in June 2002.
The Plaintiffs' Position
[98] As for several other items of costs, the Plaintiffs argued that nothing is recoverable for the Scandinavian Witnesses because they addressed issues of invalidity. For that reason, the travel costs for counsel to meet with them in Europe are not allowable. Simply on the face of the materials, the amounts claimed are enormous for factual evidence barely mentioned in the Trial Decision. Much of their charges are for advisory work. There is no basis in law for such non-expert fact witnesses to charge, via contract or otherwise, for their time and then have the losing litigant indemnify those costs. Tariff A of the Federal Courts Rules provides:
...3.(1) Witness fees - Subject to subsection (2), a witness is entitled to be paid by the party who arranged for or subpoenaed his or her attendance $20 per day plus reasonable travel expenses, or the amount permitted in similar circumstances in the superior court of the province where the witness appears, whichever is the greater....
(3) Additional costs to witness - A party may pay a witness, in lieu of the amount to which the witness is entitled under subsection (1) or (2), a greater amount equal to the expense or any loss incurred by the witness in attending a proceeding....
The relevant superior court tariff (Manitoba) provides for $25.00 per day. The evidence does not establish that the payment to the Scandinavian Witnesses to secure their attendance meets the test, for lost earnings of a fact witness obliged to be absent from his or her occupation in order to testify, posed in the case note at p. 862 in Federal Court Practice 2005 supra for Maligne Bldg. Ltd. v. The Queen, [1983] 2 F.C. 301 (T.D.). The record indicates that both were retired at the relevant time. The Plaintiffs, consistent with Tariff B1(a)(i) (Manitoba) concede $25.00 for each half-day of Mr. Huhtapalo's testimony only, plus his reasonable travel disbursements, but nothing at all for Dr. Heinonen who did not testify.
[99] The Plaintiffs argued that these fact witnesses are effectively charging more than many experts for evidence not of much apparent value in the Trial Decision, ie. para. [262] and then nothing until paras. [305] - [311], which is all there is for five days of testimony. Pages 2272 -2275 of the trial transcript disclose the trial judge finding problems with Mr. Huhtapalo's evidence. Pages 2759 - 2762 of the trial transcript disclose the trial judge assessing and then characterizing the worth of Mr. Huhtapalo's evidence as "close to the minimum foundation as one could get, but given Mr. Huhtapalo's long experience with the Viktoria, it is evidence capable of supporting the admission of the model into evidence", hardly a ringing endorsement.
[100] The Plaintiffs argued that the decision to not bring Dr. Heinonen back for the 3rd Trial Portion in 2002 undercuts any assertion of his importance. The principle in para. [15] of Thakore v. Canada (Minister of Indian and Northern Affairs), [1989] 3 F.C. 50 (T.D.) should apply: nothing is allowable for a witness whom counsel decides not to call. It is unreasonable to claim for 26 days' attendance by Mr. Huhtapalo, including arrival a full week before the trial resumed, for the 2nd Trial Portion in 2001 because it was apparent, particularly with Mr. Halford returning to the stand, that the Plaintiffs' case would take several more days before the Seed Hawk Defendants could begin their case. As well, Mr. Huhtapalo unnecessarily arrived a week before the 3rd Trial Portion in 2002 started and stayed in Winnipeg for some days after completing his testimony on June 18, for no apparent reason.
[101] The Plaintiffs disagreed with the proposed inference that Dr. Heinonen was not called due to circumstances beyond the control of the Seed Hawk Defendants. The evidence is that the Plaintiffs agreed to the request in the 2nd Trial Portion in 2001 to interrupt their case, because of age and travel concerns, to permit him to testify, but the Seed Hawk Defendants chose instead to put Mr. Huhtapalo on the stand out of order, to which the Plaintiffs had not agreed. Pages 2078 - 2083 of the trial transcript disclose the trial judge addressing this problem and ultimately permitting Mr. Huhtapalo to go first. He also comments on the cost implications of bringing people back from Europe. The record discloses that Mr. Huhtapalo was willing to return to Canada.
[102] The Plaintiffs pointed to several examples of inappropriate charges, such as duplication and business class fares, and suggested that there are many others. Per Dableh v. Ontario Hydro, supra, (T.O.) at para. [20], economy fares and not business class fares are the norm for allowable costs. There is nothing in the evidence to assist in excluding the possibility of business class fares. The smaller amount of $1,841.56 for Mr. Huhtapalo's airfare in June 2002 is difficult to reconcile with the approximate $3,900.00 for his October 2001 airfare. The features of modern communications are feasible options for the exploration and assessment of the potential value of witnesses. In the alternative, if face to face meetings are deemed advisable, only one lawyer, not two, had to travel to Europe. Including Mr. Horne's second trip to Europe, the costs for these trips are excessive in the scheme of partial indemnity. Certainly, any business class fares should be reduced. To reiterate, any costs associated directly or indirectly with the Scandinavian Witnesses are not allowable because of the submissions above on invalidity.
Assessment
[103] These items of costs are the last for which I made without prejudice comments on June 27, 2005, upon the resumption of the hearing of assessment of costs. I stand by them. I acknowledge the shift in circumstances leading to the involvement of these fact witnesses respected, however, for their special knowledge in this particular field and which made their potential testimony prudent and relevant. I have no doubt whatsoever that, without an inducement by way of payments for their time, counsel for the Seed Hawk Defendants would not have been able to get them to come within our jurisdiction. That said, I do not think, regardless of my views of the extent of my jurisdiction or discretion as a function of various authorities, or even recourse to the remedial provisions of the Interpretation Act, s. 12, that the provisions of tariffs cited before me permit me to overcome the application and limitation of Federal Court Tariff A3(1) regarding fact witnesses, ie. by permitting the contractual or otherwise expenses for their time. As well, my decision to limit them to witness fees (the Manitoba allowance) was not influenced by what some might view as their leveraging of the circumstances: it is all simply beyond my jurisdiction. The Seed Hawk Defendants were not without options. For example, I do not presume to speculate whether it would have been feasible or appropriate in the circumstances, nor whether a motion for it would have been successful and what associated provision for costs there might have been, but a rogatory commission is a means sometimes used to secure essential evidence not available in the jurisdiction for whatever reason. I have nothing to add to my conclusions above on invalidity.
[104] The Court in Windsurfing International Inc. et al. v. Bic Sports Inc. et al., 6 C.P.R. (3d) 526 (F.C.T.D.), on an appeal of a taxation of costs as to the denial of costs associated with travel by counsel to meet with potential witnesses not ultimately called, but from whom material beneficial in case preparation was obtained, found that (p. 532):
...There was, in my view, an error in principle. As I understand it, the time spent by the solicitors with these witnesses was included, and allowed, in the item "preparation for trial". It is not always possible to obtain accurate information and evidence, by correspondence, from a witness outside the jurisdiction, or far from the solicitors' place of business. Face to face interviews are often necessary in order to assess the quality of the evidence, and the impression, good or bad, a potential witness might make in testifying at trial. Further, one must weigh the relative costs of the solicitor travelling to the witness, or vice-versa. Those are factors a taxing officer ought to consider in allowing or disallowing claims of the type....
The Court then referred to the tariff provision in effect at the time for disbursements (essentially the same as now) and referred the matter back to the taxing officer for reconsideration on whether these disbursements were essential for conduct of the action and should be allowed. In these circumstances, I think that this jurisprudence more realistically captures the demands of litigation and I therefore accept counsel's decision to explore the value of this potential evidence by travelling to Europe. However, I do not agree that, for the first trip, two counsel were necessary. I am familiar with Mr. Macklin's considerable standing and experience at the intellectual property bar. I am not as familiar with Mr. Horne, but his work before me in this matter stands him in good stead, in my opinion. This is simply to say that I am not convinced that one of these two counsel, experienced intellectual property practitioners both, could not have handled this work on their own: I will make the appropriate adjustments below for their costs.
[105] I accept the rationale advanced for the presence of both Scandinavian Witnesses during the 2nd Trial Portion in 2001, ie. the extent of their experience with the prior art. Therefore, some, but not all of the claimed travel disbursements, are assessable. For example, I doubt whether one or both of the Scandinavian Witnesses would have agreed to simple full fare economy flights, the practice usually approved for litigation costs, but I have some difficulty reconciling the $1,841.56, which strikes me as a faresaver amount, for Mr. Huhtapalo's June 2002 trip with the $7,765.43 (the two fares totalled) for their attendance for the 2nd Trial Portion in 2001, particularly given that I accept the Seed Hawk Defendants' point that a regional flight to and from a hub for international destinations would have been required. Items such as availability of cheaper hotels, number of days required, meals, telephone calls and other incidentals ordinarily associated with travel status are canvassed more fully below.
[106] The trial judge's ruling on evidence out of sequence came on October 31, 2001, the Wednesday of the third week of the 2nd Trial Portion in 2001. The circumstances necessitating this approach would or should have been apparent several days before. As noted above, estimating pace of case presentation and scheduling of witnesses is an imprecise exercise which varies with the circumstances, but I accept the premise that responsible counsel, notwithstanding earlier work with a potential witness to evaluate and prepare his evidence, may need some last minute preparation work face to face with a witness. Jet lag may be a factor: see the particular circumstances of Dableh v. Ontario Hydro, supra (T.O.) at para. [16] where I was not inclined to take it into consideration.
[107] I do not think that the Plaintiffs should be responsible for the full 26 days of travel disbursements. I peg October 25 (the Thursday of the second week of the 2nd Trial Portion in 2001) and November 3 (the day after the end of the 2nd Trial Portion in 2001) as acceptable travel days to and from Canada for both. I have in mind that the Seed Hawk Defendants' counsel had had only limited opportunities already for witness preparation. The Plaintiffs urged me to restrict attendance fees to actual days of testimony. The Federal Court tariff and the Manitoba Court of Queen's Bench tariff do not specifically require that. Rather, they mandate fees for necessary attendance. I could easily conceive of circumstances of a witness under subpoena attending on a certain day only to find that his actual taking of the stand has been delayed, but being told to hold himself available in the area of the courtroom that day and ensuing days until called. I think that attendance fees would be assessable in those circumstances for sitting days only, but not weekends. If the witness was on travel status throughout, travel disbursements would be recoverable throughout, including weekends.
[108] A subpoena was not a factor here. Regardless, the Manitoba tariff mandates witness fees, not as a function of a subpoena, but rather of arrangements for necessary attendance. In my opinion and depending on the circumstances, that includes the earliest feasible date of testimony, unless excused to a specific date. I allow, per the Manitoba tariff, $25.00 per half-day for each of the Scandinavian Witnesses for the full week of sitting days (5) in the third week of the 2nd Trial Portion in 2001, totalling $250.00 for each. I allow $6,400.00 total (taxes included) for their combined airfares. The evidence indicates a group booking and payments for hotels and some living expenses. I have rejected the Plaintiffs' position below concerning an acceptable hotel rate. I allow the rate, reflected in the evidence, of $95.00 per night plus $6.65 for each of PST and GST (total $108.30) for 9 nights each, totalling $974.70 for each. Sometimes, the federal or provincial government travel rates for civil servants are advanced as the standard for meals and incidentals. I agree that they are a useful tool or guideline, but their parameters are not absolute as circumstances can differ from one case to another. I accept that local calls and some laundry may be necessary. I do not think that long distance calls were necessarily required, other than perhaps for brief family contact. I allow living expenses of $75.00 inclusive of taxes for each person per day for October 25 to November 3, 2001 inclusive (full amounts for the travel days given that expenses likely arose as a function of the regional connections), totalling $750.00 for each. I have not factored in time zone changes. Ground transportation costs, if any, were not claimed, or are not evident.
[109] As for Mr. Huhtapalo's return for the 3rd Trial Portion in 2002, I think that arrival on the Friday before commencement (weather delays would not likely have been an issue, but I have allowed some flexibility for airline difficulties given that this was international travel) was sufficient. The departure date is a little more difficult to gauge because, in 2001, it was known in advance that November 2 was the last sitting day. In 2002, he was set to continue his testimony from the start of this trial portion for an unspecified duration. He finished on the morning of June 18 (the 2nd day), but apparently stayed for six more days until June 23. I think that June 20 would have been a reasonable estimate. I allow attendance fees for 1.5 days of his testimony, totalling $75.00. The hotel rate used in 2002 (the group booking) was $98.00 plus $6.86 for each PST and GST per night, which I will apply. I allow his hotel charges for six nights ($670.32 total). I allow living expenses of $75.00 per day for 7 days ($525.00 total including the two travel days, as above). I allow his airfare as presented at $1,841.56 (plus taxes).
[110] Mr. Huhtapalo charged for his time, plus some transportation disbursements, to meet in Europe with the Seed Hawk Defendants' counsel. My disallowance above of the charges by this fact witness for his time in meetings designed for counsel to explore and evaluate his potential evidence was not because I thought that the defence could have prevailed without the information arising out of this leveraged expense. As noted above, discretion must be used in assessing costs because counsel are called upon to use discretion in the first instance and sometimes, as here, weigh difficult options in deciding to incur costs. I approve of the approach in the Manitoba tariff in recognizing the realities of litigation, ie. costs for the production of models. As a matter of practice, I have difficulties, notwithstanding comments above to the effect that no one asks to be sued, with requiring the losing litigant to indemnify costs for the time of fact witnesses in preliminary meetings. However, I think that Mr. Huhtapalo's work in case preparation, ie. the models, was likely of value. Relative to the claimed $7,395.72 + taxes for his research work in 2001, I allow $3,100.00 inclusive of disbursements and taxes.
Disbursements of $605.08 inclusive of GST for travel expenses (paid by the Seed Hawk Defendants) of Dr. Harry Ukrainetz, a fact witness for the Plaintiffs, for his re-attendance at the 3rd Trial Portion in 2002
The Seed Hawk Defendants' Position
[111] The Seed Hawk Defendants argued that the trial judge, in addressing the request for Mr. Huhtapalo to testify out of turn, understood that his ruling was interim in nature, ie. by stating on October 31, 2001 that, should there be insufficient time to call Dr. Ukrainetz, "the cost of his re-attendance will be borne in the first instance by the defendants who are getting the benefit of much larger savings by virtue of this order" (my emphasis). This was not a motion ruling for costs in the cause or in any event of the cause as the trial judge understood that further directions would be necessary, but rather an interim provision pending further directions, ie. ultimately addressed in the Trial Decision directing a motion for costs in turn resulting in the Costs Decision. As it happened, the Seed Hawk Defendants had to also pay for Mr. Huhtapalo's re-attendance. The circumstances of Dr. Heinonen not returning to testify are irrelevant.
The Plaintiffs' Position
[112] The Plaintiffs argued that the trial judge's ruling, made from the bench, recognized that it would be absurd, given that the Plaintiffs were interrupting their ordinary flow of case presentation, to require that the Plaintiffs pay once in 2001 for his attendance to give testimony which certainly would have been completed then, and then again in 2002 as a function of accommodating the Seed Hawk Defendants. The phrase in the ruling, "borne in the first instance", means that the Seed Hawk Defendants must bear this cost because the Plaintiffs' costs for his initial attendance would otherwise have been wasted. This ruling resolves that and stands apart from any effect of the Costs Decision because it addressed a discrete issue in the context of the oral rulings at trial.
Assessment
[113] This was one of a myriad of ad hoc decisions that trial judges are called upon to make from the bench. I do not think that the principles surrounding such interlocutory decisions differ significantly, if at all, from those flowing from formal motion record materials led incidental to a trial. I considered this ruling from the perspective of my analysis in Aird v. Country Park Village Properties (Mainland) Ltd., [2005] F.C.J. No. 1426 (A.O.):
... [10] As for the Defendant's alternative position urging minimum allowances, the costs decision triggered the Plaintiffs' entitlement to costs of this motion. The use of the term, "costs in the cause", did not create circumstances comparable to paragraphs [8] to [10] inclusive in Rolls-Royce plc v. Fitzwilliam, [2004] F.C.J. No. 626 (A.O.). That is, the motions judge here did not defer disposition of the matter of costs of the motion to the trial judge, but rather awarded costs without restricting them to mid-range Column III leaving only the matter of to whom the costs were to go in the hands of the trial judge. Per my analyses in Webster v. Canada (Attorney General), [2003] F.C.J. No. 1652 (A.O.), Almecon Industries Ltd. v. Anchortek Ltd., [2003] F.C.J. No. 1649 (A.O.) at para. [17], Milliken & Co. v. Interface Flooring Systems (Canada) Inc., [2003] F.C.J. No. 1586 (A.O.) at para. [17] and Sawridge Band v. Canada, [2002] F.C.J. No. 1426 (A.O.), the Rule 400(1) jurisdiction of the Court for interlocutory costs is exercised independently from the result of the judgment, except where expressly provided by language such as "costs in the cause". Thus, a judgment after trial does not generally perfect entitlements to costs for interlocutory events for which the relevant interlocutory orders were silent on costs or specifically denied costs. The effect here of the motion judge's award of costs in the cause is to define and limit the role of the trial judge to the perfection of entitlement to these interlocutory costs, but not to permit variance by the trial judge of said interlocutory award by such means as mid-range Column III, solicitor-client costs or a different Column. Put another way, once the motion judge issued his order for costs in the cause without a modifier per Rule 407 varying the general default parameters of Column III, ie. for something such as mid-range Column III, the Court, be it the motion judge or the trial judge, was functus. Therefore, the term "throughout" in the costs decision cannot be applied to vary the disposition of the motion judge by restricting the allowance to mid-range Column III. From a different perspective, I think that this conclusion is reinforced by noting that assessment and recovery of interlocutory awards of costs do not always need to await judgment after trial: see the analysis of "forthwith" provisions in Culhane v. ATP Aero Training Products Inc. [2004] F.C.J. No. 1810 (A.O.)....
[114] The trial judge first gave reasons and then made his order (pp. 2081-84 of the trial transcript):
... There are a number of, I think, considerations that go into a decision of this sort. One of them is that given the ordinary order of proceeding, if there is a question of or a conflict between the unavailability of a plaintiffs [sic] witness in the course of the plaintiff's case and that of a defendant's witness, then the plaintiff, I think, has the benefit of going first.
The other consideration is that to the extent that submissions are made on the basis of what may happen on the basis of contingencies, I am not disposed to make an order on that basis, simply because it is engaging to some extent in speculation.
I am satisfied that the witness or the evidence sought to be called by the defendants is important to the defendants and I am satisfied that they don't have the means for compelling that testimony in any other way, but what I find actually most compelling, being of a practical turn of mind, is the matter of costs.
I take judicial notice of the fact that the cost of bringing the Scandinavian witnesses here has to have been considerable and the cost of bringing one or both of them back would also have to be considerable if they don't testify.
I have no doubt that this litigation is proving costly enough to both parties that there is no advantage in doubling up on those costs, particularly when it is not known who ultimately will bear those costs.
I think that the delays which we have encountered, which I put at no one's feet but are a fact of this matter, and that the cost to be incurred if these witnesses are to be brought back do constitute special factors which would justify an order out of the ordinary course. So my decision is that we will proceed as follows:
I will hear first from Mr. Hultgreen because the evidence is that he will not be available in June and the plaintiff is entitled to have his evidence go in.
We will then hear from Mr. Huhtapalo, followed by Dr. Heinonen on the basis that it was reasonable for the defendants to incur the cost of bringing them here to testify and it would be unreasonable to satisfy -- I'm sorry, to saddle whoever will ultimately bear the costs with another set of costs related to their attendance.
Following that, we will hear from Mr. Ukrainetz, and if for whatever reason we do not have time to hear from Mr. Ukrainetz, the cost of his re-attendance will be borne in the first instance by the defendants who are getting the benefit of much larger savings by virtue of this order.
Following that, if there is time left, and if the defendants still desired that -- well, the question of Dr. Domier hasn't been dealt with. Once we get to Mr. -- after we gave dealt with Mr. Ukrainetz, if the defendants still wish to deal with the question of Dr. Domier, we can deal with that at that time.
MR. HORNE: Thank you, My Lord.
MR. RABER: Just on the latter point, I notice it is not even in the Notice of Motion.
THE COURT: No, it is not, and that's why I said it has not been dealt with. We can deal with it then. Anything in relation to that, gentlemen?
MR. RABER: Not from me, My Lord.
THE COURT: It is not ideal from anyone's point of view, so we will hear from Mr. Hultgreen, Mr. Raber, if you are ready to proceed....
[115] I think that the comment relative to the Scandinavian Witnesses, "doubling up on those costs particularly when it is not known who ultimately will bear those costs", clearly fits the Seed Hawk Defendants' proposition, ie. that a subsequent direction is contemplated as to who, in the end, will pay for the Scandinavian Witnesses in the event one or both had to re-attend. I think that his preamble to this ruling and the later Costs Decision combine to make the Plaintiffs responsible for the costs of Mr. Huhtapalo's re-attendance. I think, further to Genpharm Inc. v. The Minister of Health et al., [2003] 1 F.C. 402, [2002] F.C.J. No. 1018 (F.C.A.) at para. [8] referring to Blueberry River Indian Band v. Canada (Department of Indian Affairs and Northern Development), [2001] 4 F.C 451, [2001] F.C.J. No. 725 (F.C.A.) at para. [38], that I can look at his reasons to determine the intent of the order. If Mr. Huhtapalo's evidence was essential, it follows that it was essential for the Seed Hawk Defendants to accept this direction and pay for the return of Dr. Ukrainetz. The phrase "in the first instance", can certainly and usually does carry a conditional sense, ie. subject to further considerations as the Seed Hawk Defendants assert.
[116] Quite frankly, I think that the ruling does not make sense if I find that it intended that the Plaintiffs, regardless of their ultimate success or not, effectively be saddled with two sets of travel disbursements for Dr. Ukrainetz. In other words, looking at this in hindsight, the Plaintiffs paid the first time for Dr. Ukrainetz with the unfulfilled hope of ultimately getting an award of costs requiring the Seed Hawk Defendants to indemnify them for those costs. That did not happen and the Plaintiffs are out of pocket for his first set of travel costs. The second set of travel costs for Dr. Ukrainetz did not arise as a consequence of adverse conduct by either side, but certainly as a function of an attempt to mitigate costs. The travel costs associated with Mr. Huhtapalo's re-attendance in June 2002 were clearly caught up in the cause: the pace of case preparation made it impossible to finish with him in 2001 and the Plaintiffs suffer those consequences. However, I do not think that this ruling provided that the Plaintiffs would suffer an additional penalty in the cause by assuming responsibility for the costs of re-attendance by Dr. Ukrainetz. I disallow the $605.08.
Disbursements totalling $2,213.78 (inclusive of PST and GST) for travel costs of fact witness Dr. Ken Domier to attend in the 2nd Trial Portion in 2001 and the 3rd Trial Portion in 2002
The Seed Hawk Defendants' Position
[117] The Seed Hawk Defendants argued that the problems of pace of case presentation noted above meant that Dr. Domier, in Winnipeg and available to testify in 2001, had to return in 2002 to take the stand. Dr. Domier's evidence was intended to provide background relevant for Dr. Heinonen's evidence. The Plaintiffs' proposed threshold for gauging the pace of case presentation is too stringent and is predicated on hindsight. As well, there was no guarantee of success for the motion to permit Mr. Huhtapalo to testify out of order. Some lead time is needed to arrange for air travel.
The Plaintiffs' Position
[118] The Plaintiffs noted that, although Dr. Domier's travel was confined to Canada, certain of their submissions above for the Scandinavian Witnesses applied to his claimed travel costs. His costs addressed invalidity and should be disallowed on that basis alone. Alternatively, his costs should be reduced because he arrived too far in advance, in the 2nd Trial Portion in 2001, of a reasonably anticipated point for his call to the stand, particularly given the concern for calling the Scandinavian Witnesses, one of whom ultimately took five days on the stand. The absence, in the motion for testimony out of sequence, of a similar request for Dr. Domier indicates an implicit recognition that there was no chance of Dr. Domier getting called. His airline ticket was issued on October 24, 2001 for attendance on October 30. It was apparent by the former date that there was no reasonable expectation of him being called. Consistent with the sense of austerity that should pervade costs, only the costs of his attendance to testify during the 3rd Trial Portion in 2002 are recoverable.
Assessment
[119] I am not clear from my reading of the record what restrictions may have governed the October 24, 2001 airline ticket if his trip had to be postponed. I doubt whether I could find an instance in the record pointing to a burst of activity taking less than the estimated duration, but counsel do have an obligation to protect the client's interest and the Court's sitting time by ensuring that intended witnesses are on time. I allow the airfares for both trips ($640.93 and $346.00 inclusive of taxes) as they appear to be economy fares (the difference in amount likely a function of price competition between Air Canada and WestJet).
[120] For each trip, Dr. Domier uses the term "up-grade" to describe a change to his flight. The evidence refers to change fees. However, only the charge for the WestJet flight includes clarification that his return time had to be changed because his testimony ran late. One of the three 2001 itineraries shows a difference of 15 minutes for a different flight (Calgary-Edmonton) on November 1. There is a charge, in November 2001, of $155.15 described in the bill of costs as witness expense and in three areas of the evidence respectively as travel expenses for witness at trial, change fee and up-grade on Air Canada. The Plaintiffs objected several times to what was characterized as counsel improperly giving evidence before me by attempting to explain perceived gaps in the evidence. I tried to keep things going by cautioning counsel to confine themselves to argument by simply asking me to draw inferences. However, it is difficult to draw desired inferences if the evidence points in the wrong direction. A business class fare is not generally allowable. There is an electronic ticket passenger receipt for the 2001 flight showing an amount for an economy fare ticket. There is no such receipt for the WestJet, but that airline ordinarily would not have short haul business class fares. I disallow the upgrade charges. I allow the remaining claims for living expenses (meals, telephone, hotel, ground transportation) as their total amount is consistent with my allowances elsewhere, ie. such as for the Scandinavian Witnesses.
Items 8 and 9: maximum Column IV units (counsel fees) claimed for preparation of and appearance on three instances of discovery of James W. Halford (plaintiff) on November 24 and 25 (½ day), 1997; September 8, 1999 and September 4, 2001
Items 8 and 9: maximum Column IV units claimed for preparation of and appearance on four instances of discovery of Norbert Beaujot (defendant) on November 25 (½ day), 26 and 27, 1997; March 16 to 18, 1998 inclusive, March 29 and 30, 1999 and August 2, 2001
The Seed Hawk Defendants' Position
[121] The Seed Hawk Defendants argued that events, such as the Plaintiffs' amendments to their pleadings, warranted multiple item 8 preparation charges for discovery as the work for each instance of discovery was discrete. It is inconsistent for the Plaintiffs to argue that the provision in the Costs Decision for the "high end" of ranges does not mean the maximum value given their claim for the maximum value further to the same language in the March 25, 2004 Order. The Costs Thrown Away Decision permitted the Plaintiffs to discover the Defendants on issues arising out of the amended productions or defences. The subsequent discovery preparation work for Mr. Beaujot flowed from that order and is caught up in the residual provision in the Trial Decision requiring the parties to speak to costs of the action by notice of motion. Subsequent to the Costs Thrown Away Decision, the Plaintiffs sought to amend their productions. The Seed Hawk Defendants and the Simplot Defendant agreed on the condition that the Plaintiffs take out a consent order, including a provision for discovery of issues therefrom. Although said draft order may not have been formally entered into the record, it binds the conduct separate from the Costs Thrown Away Decision, ie. the preparation claim for discovery of Mr. Halford on September 4, 2001.
[122] Contrary to the Plaintiffs' assertion, the costs associated with discovery of Mr. Beaujot on August 2, 2001, are not precluded by the Costs Thrown Away Decision because this work was part of the overall conduct of the case, notwithstanding that it flowed from the relief in the Costs Thrown Away Decision, and therefore is caught by the award of costs to the Seed Hawk Defendants in the Costs Decision. Therefore, the Seed Hawk Defendants, and not the Plaintiffs as they do in their bill of costs, are entitled to claim for preparation for and discovery by the Plaintiffs of Mr. Beaujot on August 2, 2001. The claimed costs fall within the purview of Milliken, supra (A.O.):
... ASSESSMENT
¶ 94 This passage from the Court's reasons dated April 24, 1998, is useful in resolving the meaning of this phrase in the March 11, 1998 order "Plaintiffs' action in T-3016-92 is dismissed with costs, subject to any further Order regarding costs thrown away":
[7] Costs thrown away are those which are wasted for work rendered useless as a result of the amendment sought, either because an issue has been withdrawn, abandoned or otherwise rendered moot. The expression is well illustrated in the following example given by Bouck J. in Cominco Limited v. Westinghouse Canada Limited et al., [1980] B.C.J. No. 1353:
For example, a plaintiff may completely change his case in midstream from one of negligence to one of breach of trust. To meet this new allegation a defendant may have to entirely revise his defence and conduct new examinations for discovery. The old defence and the old discovery would have become useless and so the defendant would be entitled to the cost of these proceedings because he was put to the expense of defending allegations in negligence which were subsequently abandoned by the plaintiff and changed to breach of trust. It is as if the plaintiff's case for negligence was dismissed or discontinued and a fresh action for breach of trust was begun.
But some amendments do not establish an entirely new claim. Often there is no need for a defendant to amend his defence after a plaintiff has amended his statement of claim. If a new discovery is required it might just be for a limited purpose and most if not all of the earlier discovery might still be useful. In that sense the cost of the earlier discovery would not have been completely "thrown way". Only a part would have been lost.
[8] Costs thrown away must be distinguished from costs of and incidental to an amendment which are costs incurred from the time of the amendment onwards and are part of the award of costs after the event at trial. As stated in Cominco:
... [I]t seems the term "costs thrown away" is a phrase which is often included in an order where one party is given an adjournment of a trial or leave to amend or both. It would also appear to cover the same ground as an order for "costs of and incidental to" an adjournment or an amendment as the case may be.
Any costs incurred by the defendant from the time of the amendment onwards would seem to be at large; that is to say they follow the event after the trial. In this instance if the plaintiff succeeds, it gets these costs. If the defendants win, the costs are theirs. All of these orders are, of course, subject to the discretion of the trial Judge.
[Citations omitted]
¶ 95 This passage undermines the Defendant's position because it appears to suggest that costs thrown away are not part of the award of costs after trial. Put another way, costs thrown away are distinct from the award of costs after trial because they are associated with a single occurrence, ie. adjournment or amendment, at one point in time in the continuum of litigation, but not the several events along the continuum of litigation., ie. pleadings, discoveries, case preparation, appearance at trial, that an award of costs after trial embraces. For example, costs thrown away further to an amendment address work prior to the amendment and which the amendment rendered useless. Any work after the amendment is not part of this "useless" work, but rather is work caught up generally in the several events along the continuum of litigation. Any costs associated with this latter work are costs at large, ie. not costs thrown away, but costs which may ultimately be recoverable as part of an award of costs after trial. From a simpler perspective, a motion for costs thrown away is interlocutory and is not a continuation of the trial. Interlocutory motions, being incidental to trial, can and do occur after trial. Their events are distinct from the event at trial. An order silent as to costs lacks the requisite and visible exercise of the Court's Rule 400(1) authority for costs....
The costs for this work by the Seed Hawk Defendants on these further discoveries were "costs at large" caught up in the Costs Decision. The Plaintiffs cannot claim for their preparation and attendance for these further discoveries because those were not costs thrown away. Rather, those costs were associated with the Plaintiffs' work eventually leading to the adverse Trial Decision and not with any work by the Plaintiffs rendered moot by the relief in the Costs Thrown Away Decision.
The Plaintiffs' Position
[123] The Plaintiffs argued that the tariff and the jurisprudence preclude multiple preparation claims for the same attendance. The term "high end" in the costs decision does not necessarily mean the maximum value in the available ranges (the Plaintiffs addressed this argument to all counsel fee items in the bills of costs). The assessment officer has residual jurisdiction to make adjustments. For example, from the available Column IV range of 4 to 8 units for item 8 preparation, I could perhaps choose 6 units and I could certainly choose 7 or 8 units. For item 9 attendance with the available range of 0 to 4 units, I could choose 3 units. Alternatively, I could allow something less for the subsequent item 8 and 9 claims.
[124] The Plaintiffs argued that the discoveries of Mr. Beaujot and Mr. Halford on August 2 and September 4, 2001, respectively, flowed from the relief in the Costs Thrown Away Decision. Said decision provided that the Seed Hawk Defendants were to bear the associated costs. The trial judge, as the judge also rendering the Costs Thrown Away Decision, implicitly recognized in said decision that the Plaintiffs would have to take additional steps, with associated costs consequences to be borne by the Seed Hawk Defendants:
[17] It is known that at least one paragraph of the Amended Statement of Defence raises a matter which was canvassed in Mr. Halford's evidence to date and which alleges a state of affairs possibly at odds with the evidence. That is the proposed paragraph 13(d) which alleges the following:
The named plaintiff Halford is not the inventor of the subject matter of the aforesaid claims. If there be any invention, the said subject matter was invented by F. Benjamin Dyck and directly disclosed to the plaintiff Halford by way of a sketch drawing prepared by F. Benjamin Dyck and forwarded by mail to Mr. Halford by Mr. Dyck in or about 1979 - 1980.
[18] It is not appropriate for me to comment on the evidence at trial, so I will limit myself to repeating what Mr. Raber says about this amendment.
Mr. Halford's involvement with Benjamin Dyck was canvassed at length when Mr. Halford gave evidence at the trial on November 6, 7, and 8, 2000. It was also reviewed in detail during examinations for discovery. Mr. Halford's evidence was to the effect that he was referred to Mr. Dyck by Mr. William Reed in 1983.
[19] How can the plaintiffs respond to this pleading at this stage of the trial Given that it is a fundamental factual issue, it would take highly unusual circumstances to reach the position that the Court would refuse to consider evidence on this point because of a late amendment. This would introduce an artificiality into the proceedings which is totally at odds with the fact-finding nature of a trial. But the plaintiffs cannot be asked to simply leave the issue where it is, given its significance for their case. Some relief in the way of further evidence would have to be allowed.
[20] The same may be true for other changes introduced by the amendments. It is difficult for me to assess the significance of the various amendments without knowing the plaintiffs' case. It would be unfair to put the plaintiffs to the trouble of applying to lead new evidence on an issue by issue basis, both in terms of telegraphing their case and in terms of the cost and effort involved. It is therefore my view that if the amendments are to be allowed, examination-in-chief would have to be reopened on any issue arising out of the Amended Statement of Defence and cross examination allowed on those issues. Re-examination would then follow. It would also be necessary to release counsel and Mr. Halford from the order which prohibits discussion of Mr. Halford's evidence to date. Without knowing what issues might require further evidence, I cannot limit the topics of discussion without limiting the plaintiffs' ability to put their case before the court. It also follows that the plaintiffs would have the right to re-examine for discovery on any issue arising out of the amendments and if necessary, to file a reply to the Amended Statement of Defence.
[21] The plaintiffs should also have their costs thrown away resulting from any step undertaken as a result of the granting of the relief sought by the Seed Hawk defendants from those defendants only in any event of the cause....
[125] The Plaintiffs, in their Summary of Plaintiffs' Submissions on the Issue of Counterclaim Costs filed on May 2, 2005, at the hearing before me, led argument applicable to these particular fee items and throughout generally to all claims in the bills of costs:
... Other Fees and Disbursements Relating in Part to Counterclaim for Invalidity
47. Finally, the Seed Hawk defendants also have included in their bill of costs considerable amounts for photocopying expenses, courier expenses, fax expenses, long distance telephone charges and telephone charges incurred over the course of the litigation. While precise figures obviously cannot be determined with any precision, common sense dictates that a considerable portion of these expenses related to the issue of invalidity as opposed to infringement or personal liability. Again, because the Seed Hawk defendants were not allowed their costs of the counterclaim, the amounts claimed should be discounted accordingly. Based on the manner in which the trial time was utilized and the fact that the majority of the documentation generated over the course of the litigation pertained to the prior art and the issue of invalidity, the plaintiffs submit that all such expenses should be reduced by at least 50%, following which the balance can be assessed on the basis of reasonableness and necessity.
48. The plaintiffs submit that the same principle should apply to monies paid by the defendants for transcripts from examinations for discovery and trial, inasmuch as the number of pages and corresponding cost of the transcripts increased considerably as a result of testimony related to the issues raised by the counterclaim. The expenses claimed by the defendants for such things as accommodation, meals and office space rented from the Pitblado law firm also are greater than would have been the case had the defendants not advanced a counterclaim for invalidity, and should be reduced appropriately.
49. The fees claimed by the defendants in respect of each step of the proceeding similarly should be reduced to the extent the costs associated with same were increased as a result of the counterclaim. The most obvious area where this is appropriate are the fees claimed in respect of preparing for and attending at examinations for discovery of James Halford and Norbert Beaujot, where considerable time was spent addressing issues raised by the counterclaim for invalidity, separate and apart from the issues of infringement, personal liability and inducement raised in the main action.
Conclusion
50. It is submitted that, for all of the above reasons, both the Seed Hawk defendants and Simplot have proceeded improperly in seeking to recover on these assessments costs associated with the counterclaim for a declaration of invalidity. The counterclaim was dismissed without any order as to costs. Accordingly, any entitlement to costs is limited to those fees and disbursements attributable to their defence of the claims brought against them by the plaintiffs, which amounts are substantially less than those claimed in the defendants' bills of costs.
Assessment
[126] On the issue of the meaning of the words "at the high end", I find in favour of the Seed Hawk Defendants as I am not persuaded that my conclusions were incorrect in Mitchell v. Canada (Minister of National Revenue - M.N.R.), [2003] F.C.J. No. 1530 (A.O.):
... [18] An award of costs with restrictive language, as opposed to an award with no restrictive language, necessarily creates comparative differences to the extent permitted by given ranges, ie. by eliminating certain choices which might otherwise be available. Therefore, I think that analysis of the term "higher" does not assist because said term necessarily implies comparative differences. I think that it is only the word "towards", in the phrase "towards the higher end", which creates the issue here. The Shorter Oxford English Dictionary on Historical Principles, Fifth Edition, Oxford University Press 2002, Volume 2 · N-Z, page 3311, gives several definitions for "towards", but with a common thread: something which approaches, but does not include, a thing or value. The dictionary definitions in Volume 1 · A-M, pages 139-40, for "at" take several forms. The relevant definitions at page 140 are "Relative position in a series or scale; degree, rate, value" and "Defining a special point in a series or scale". If the Court had awarded Column V costs with no modifiers, allowances at all points in given ranges, including the highest and one less than the highest would have been possible. However, there were modifiers here which limit my discretion. The meaning of "towards the high end" does not include a value in a range "at" the high end. I allow the various items as conceded at one unit less than the highest value in the range, where possible....
[127] I think that Rules 405 and 407, requiring that an assessment of costs proceed according to Column III unless otherwise provided (as here), give me the jurisdiction to decide which items are assessable, including how many times a given item may be claimed. The Seed Hawk Defendants' presentation of costs has undergone several revisions. If I read the latest version correctly, a claim of 8 units (maximum Column IV range) is entered opposite preparation for the November 1997 examination for discovery of Mr. Beaujot, but nothing is entered beside the March 1998 and March 1999 entries for his discoveries, although item 9 costs are claimed for the four attendances.
[128] Item 8 preparation costs are claimed for each instance of discovery of Mr. Halford. Relative to the instances of discovery of both men prior to 2001, I noted that there were gaps of a few months to a year or two between the examinations. That in itself is not justification for fresh preparation costs, but my reading of the record indicates that the sands of issues were shifting somewhat and I think that the preparation would not simply have been unnecessary repetition of work already completed. I allow the item 8 preparation claims for both men as presented, as well as the item 9 attendance claims. As for the examinations of both men in 2001 subsequent to the Costs Thrown Away Decision, my conclusions below resolve responsibility for costs associated therewith. Although the impact of the change of counsel was surely a factor here, I have no comments further to those above. I think that any preparation in 2001 was prudent in the circumstances. I allow the item 8 and 9 claims for both men in 2001 to the Seed Hawk Defendants as presented.
[129] The record sufficiently reflects the respective submissions, similar to a certain extent, for a number of other fee items. I do not summarize them in these reasons, but my allowances for these other fee items are consistent with my conclusions above, for example, on the issue of the meaning of "at the high end". The Seed Hawk Defendants advanced several claims for items 10 and 11 (preparation for and attendance on case conferences respectively). The Plaintiffs, in addition to their general argument above concerning proof and the counterclaim result, argued that these conferences were brief and required little preparation and that the tariff did not contemplate a recovery for each and every one. With respect to that argument, I think that the subheading "D. Pre-trial and Pre-Hearing Procedures" in the tariff is sufficiently broad to capture such services. As well, I am reluctant to characterize a court-mandated appearance for the purpose of case management as so negligible in effect (these nine conferences ranged in duration from 10 to 35 minutes) that no meaningful work was required of counsel. I allow these fee items as presented.
[130] The Plaintiffs argued that the Seed Hawk Defendants incorrectly claim an item 13(a) preparation fee, which is restricted to the first day of trial, for the first day of each of the four trial portions. The Seed Hawk Defendants argued that I have the discretion, faced with a fragmented trial schedule as here, to find that preparation for each portion was necessary within the meaning of item 13(a). I agree, with particular regard to the 2nd Trial Portion in 2001, but to a lesser extent in turn for the subsequent two trial portions, that enhanced preparation within the meaning of item 13(a) was necessary. However, as the wording for items 13(a) and 13(b) is quite specific in restricting the former to the first day of trial as opposed to subsequent days of the same trial (I am aware of the irony of that assertion given my speculation above, relative to matters of invalidity, on consecutive versus coincident hearings), I do not think that I have the jurisdiction, regardless of the reality of the work demanded of counsel and of my dispositions above for item 8, to allow more than one instance of item 13(a) preparation for the same trial. I have accordingly adjusted the allowances for the first day of each trial portion subsequent to the 1st Trial Portion in 2000. I do not think that the record supports the claim of six hours attendance on June 28, 2002 under item 14 in the bills of costs of the Defendants. I have adjusted the allowances accordingly to three hours in each bill of costs.
[131] Before me, there was some discussion about a single claim under item 25 (services after judgment not otherwise specified) and two claims under item 27 (such other services as may be allowed) for review and explanation to the clients of the Trial Decision and for attendance on a mediation on October 5, 2000 (six hours at 4 units per hour). The Seed Hawk Defendants argued that Rules 409 and 400(3)(e) and (o) (settlement offers and any other relevant matter respectively) permit some discretion. I routinely allow item 25, notwithstanding the absence of evidence, unless I think that responsible counsel did not, in fact, review the judgment and explain associated implications to the client. I allow item 25, but disallow the item 27 claimed for review of the Trial Decision. Items 1 to 26 in the tariff are not an exhaustive listing of possible services. Item 27 only comes into play for services not otherwise addressed by items 1 to 26. I am not going to attempt an analysis of whether a mediation is a form of conference contemplated by items 10 and 11. Settlement work is to be encouraged. Item 27, unlike other items such as item 9 for attendance on discovery, is not framed as units per hour. I do not think that I have the jurisdiction to allow 4 units per hour for six hours, but instead I am restricted to allowing only 4 units (the maximum in the available range) as a global amount for this appearance, which I do.
[132] The Seed Hawk Defendants advanced claims under item 24 for the time of lead counsel and two junior counsel to travel to and from the trial venue for the latter three trial portions. They argued that the unusual circumstances here of a fragmented trial schedule, the magnitude of the case and the Court's allowance of recovery for junior counsel permit me to infer that the trial judge intended recovery of these costs. As well, it is logical to infer that, if costs are awarded, items not specifically mentioned, ie. items 8 and 9, may be claimed, including item 24.
[133] The Plaintiffs agreed with my observation that I have the jurisdiction to address travel disbursements associated with counsel, but in the absence of a visible direction of the Court, noted that I do not have the jurisdiction to allow item 24 counsel fees for travel. There is no authority to extrapolate the trial judge's direction for item 14(b) junior counsel as somehow embracing item 24. Both items require a prior exercise of the Court's discretion and the illogical extension of the Defendants' position is that one would not need a specific direction, meaning that the assessment officer could allow it in every case, notwithstanding the requirement in each that the Court make a direction.
[134] It is convenient at this point to summarize briefly the able submissions by counsel for the Simplot Defendant on this issue. The Seed Hawk Defendants and the Simplot Defendant both included item 24 in their respective draft bills of costs put to the Court for lump sum costs, to which the trial judge responded in the Costs Decision:
ASSESSMENT OR LUMP SUM ORDER
[40] It is implicit in the ruling as to the timing of assessment and payment of costs that I have decided against making a lump sum order of costs. My reason for declining to do so is that there are numerous issues to be decided in relation to the disbursements. An assessment before the assessment officer is the proper forum for the parties to sort out those issues. The directions which I provide with respect to the assessment of fees should simplify that process so that it does not consume an inordinate amount of time. Thereafter the parties can deal with the issue of disbursements....
[135] Counsel for the Simplot Defendant, in the Submissions of the Defendant Simplot Canada Limited Respecting Simplot's Assessment filed at the hearing before me on June 28, 2005, led submissions which I found reasoned and valid:
... 75. While the learned trial judge specifically addresses the numerous issues respecting disbursements for assessment, he clearly indicates his position that the forum of an assessment officer is what is needed to deal with the detailed determination of costs and expenses subject to the broad directions which he provides to simplify the process. Simplot submits that the learned trial judge has not specifically denied the claim for travel costs and that within the ambit of para 40 he has given jurisdiction to the assessment officer to determine the appropriate travel costs.
76. There has clearly been a disadvantage to the defendants arising out of the venue of the trial as to the issue of travel costs relating to this proceeding, a fact that the learned trial judge was well aware of. Each of the defendants' counsel has incurred significant time in travelling to the various venues where proceedings were held (primarily Winnipeg). The Plaintiffs, by having counsel resident in Winnipeg gained a home court advantage that led to a significant financial detriment to the defendants which the court ought to take into consideration.
77. The Federal Court, by necessity and practicality, is one that sits in limited venues. Parties and counsel however come from all across Canada and must frequently travel long distances to appear before it. It would be an inequity if the very significant costs incurred by parties and counsel situated more remote from the court than others are left out of the assessment because of what may be an oversight by the learned trial judge to specifically address that award. The frequency with which this issue arises before assessment officers indicates that there is a problem with both counsel and the judiciary in recognizing that travel costs ought to be addressed by the court in its decisions with regularity. This is understandable in that generally at the time that the court makes its directions more significant issues are dealt with and the detailed requirement of Tariff Item B 24 is often lost sight of. As an example, the Affidavit of Halford objecting to the travel costs deals entirely with their quantum and not the issue of lack of jurisdiction....
78. The issue is one that may well vary across the country where counsel regularly appear in courts where assessment officers may also be masters or prothonotaries of the court and thereby are incidentally the court and have the power to determine these issues.
79. Rules of Court should be designed to allow for the determination of issues and where, as here, it appears that there is a systemic hindrance, the courts must take corrective measures. In the event that the assessment officer in this matter determines that there is not sufficient jurisdiction in para 40 to assess travel costs, then Simplot strongly urges the assessment officer to provide written reasons defining the problem and urging its correction through rule amendments. The assessment of travel costs is similar to assessing travel disbursements and should rightfully be within the power of an assessment officer without a trial judges [sic] specific direction....
[136] The Federal Courts Act, ss. 4 and 5.1 defining the Court, and Rule 2 of the Federal Courts Rules defining an assessment officer, mean that the terms "Court" and "assessment officer" refer to separate and distinct entities. The Court did not exercise visible discretion here for travel fees of counsel under item 24. I do not have the jurisdiction in the absence of such an exercise of discretion to allow anything. That restriction does not apply to the associated travel disbursements, for which I retain jurisdiction per Rule 405. That is, counsel fees and disbursements are distinct and discrete items of costs addressed by different portions of the tariff, ie. items 1 to 28 in the TABLE in Tariff B address counsel fees and Tariff B1 addresses disbursements. Accordingly, item 24 addresses counsel fees, but not disbursements. The discretion reserved to the Court to authorize assessment officers to address item 24, or even item 14(b) for second counsel, is exercised distinct from the discretion vested in me by Rule 405 and Tariff B1. There is no implied caveat impeding me from allowance of travel disbursements for counsel in the absence of an item 24 direction from the Court for fees for the time of counsel to travel to and from the hearing venue. The implications of indemnity for the professional time of counsel in transit is surely different than for charges (airlines, hotels and meals) for putting and maintaining one's counsel at the hearing venue.
[137] The Simplot Defendant makes a compelling point concerning the inclusion of item 24 in the draft bills of costs before the trial judge. However, once the trial judge decided against lump sum costs, the presence of item 24 in the draft bills of costs became irrelevant in terms of my drawing inferences concerning his intent because potential crystallized amounts of the bills of costs then became subject to the ordinary process of assessment for which he set out parameters, omitting however any visible authority for me to address item 24. I therefore have no choice but to disallow the item 24 claims throughout.
[138] The Costs Decision read:
FEES FOR SECOND COUNSEL
[31] The Seed Hawk defendants ask to be allowed the fees of junior counsel in addition to the fees for senior counsel. During the course of the trial of this matter, the plaintiffs were represented by one senior and one junior counsel (assisted by an articling student who received his call to the Manitoba Bar near the end of the trial) while the Seed Hawk defendants were represented by one senior and two junior counsel, except for the opening days of the trial when they were represented by a single counsel. The nature of the action, the volume of the documentary evidence, the frequent objections by both parties to the admissibility of evidence satisfy me that this is an appropriate case for allowing fees for junior counsel for the trial portion of the action at the rate of 50 per cent of the fees allowed for senior counsel....
The Seed Hawk Defendants noted that their motion for costs had asked for one junior counsel for both item 13 preparation and item 14(b) attendance, but the trial judge, who was clearly aware of the presence in the courtroom of two junior counsel (Mr. Horne and Irene Bridger), in addition to lead counsel (Mr. Macklin), excluded any allowance for junior counsel relative to item 13, but allowed the two junior counsel under item 14(b). That is, para. [31] did not use the term "a junior counsel", but rather junior counsel in the context of the references to the two junior counsel. It did not limit or exclude the third lawyer, Ms. Bridger. Black's Law Dictionary, 6th ed., s.v. "counsel", defines junior counsel as the "younger of the counsel employed on the same side of a case, or the one lower in standing or rank, or who is intrusted with the less important parts of the preparation or trial of the cause". Under the word "second", it defines second as a term used in law to "denote either sequence in point of time or inferiority or postponement in respect to rank, lien, order, or privilege". The words "second counsel" in item 14(b) refer to any counsel inferior in rank to "first counsel" in item 14(a), but not a second counsel as opposed to a third counsel.
[139] The Plaintiffs argued that the words "second counsel" in item 14(b) simply mean one junior counsel. The draft bill of costs in the motion for costs asked only for a single junior counsel consistent with that provision. The reference in para. [31] of the Costs Decision to three lawyers was simply an acknowledgment of the demands of a case which therefore warranted fees for one additional lawyer, but that cannot be stretched to mean a third lawyer, particularly given the subheading for para. [31]. The supporting evidence in the hearing leading to the Costs Decision emphasized that recovery was sought for two, as opposed to three counsel. It is simply not possible that the trial judge went off on a tangent and decided to order a third counsel when only two were requested.
[140] The parties led argument and case law on the Court's authority to allow third counsel. I have not summarized it because I think that the broad discretion conferred by Rule 400(1) is sufficient authority to do so. This issue of junior counsel concerns several thousand dollars in the bill of costs. The Compact Edition of the Oxford English Dictionary, 1st ed., s.v. "counsel" defines it as:
... 7. An assembly or body of advisers. Obs....
b. A single person with whom one consults or advises; a counsellor. Obs....
8. A body of legal advisers, engaged in the direction or conduct of a cause. (Usually a collective plural, but sometimes treated as a numeral plural; formerly, in 'to desire the benefit of counsel', 'to be allowed counsel', etc., treated as a collective sing.: cf. quot. 1681) (In this sense erroneously stated in many legal text-books to be 'an abbreviation of counsellor'.)...
Ibid. IV. 280 The second of our three Counsel was the best....
Council for Mr. Hackett were lawyers Adams and Wickham.. For Mr. Wilson.. councils, Mr. Thornton of Leeds, and Mr. Raw, son of Bradford....
Two of the learned Council against us came afterwards to be successively Lord Chancellors....
The duty of counsel is to give advice in questions of law, and to manage causes for clients. They are styled common law, equity, or chamber counsel, according to the nature of the business they transact....
This all simply means that the word counsel may have a singular or plural meaning depending on the context. The actual order in the Costs Decision did not repeat or incorporate the directions contemplated in para. [31]. As noted above, I think that I can, per Genpharm Inc., supra, examine the reasons to discern the Court's intent. The trial judge was not bound by the draft bill of costs. In my opinion, the words "second counsel" in item 14(b) may be given a singular or a plural meaning depending on context. In my experience, the usual meaning is one additional counsel, unless otherwise clarified. Here, para. [31] notes the use of two junior counsel and then, in the next sentence, permits an allowance for "junior counsel". I find that to be clarification enough in the particular circumstances here to allow the claims for the third lawyer, Ms. Bridger.
Disbursements totalling $23,659.59 (PST and GST included, as well as costs for Brian Kent) for travel costs of Norbert and Pat Beaujot (Seed Hawk Defendants) for attendance at discoveries and trial and for certain exhibit reproduction costs
The Seed Hawk Defendants' Position
[141] The Seed Hawk Defendants noted that Brian Kent did not attend the trial: travel costs are claimed only for his March 30, 1999 discovery. The Court in Bayliner Marine Corp. v. Doral Boats Ltd., 15 C.P.R. (3d) 201 (F.C.T.D.), concluded at p. 208, for disbursements of witnesses, that although "the witness Hanna was president of defendant, the separate corporate personality permits him to be taxed as a witness including his travel expenses for examination for discovery and trial, but not for any attendance for the purposes of giving instructions to counsel." Bayliner Marine Corp. supra addressed a party as witness and therefore is not inconsistent with the Plaintiffs' asserted jurisprudence because those cases addressed only parties present at the hearing to instruct counsel: Beloit Canada Ltee. v. Valmet-Dominion Inc., 39 C.P.R. (3d) 90 (F.C.A.) and TRW Inc. v. Walbar of Canada Inc., 43 C.P.R. (3d) 449 (F.C.A.). The conclusions in Baker Petrolite Corp. v. Canwell Enviro-Industries Ltd., 23 C.P.R. (4th) 349 at 352 (F.C.A.) can be distinguished because they addressed an attendance on the appeal as a representative of a party to instruct counsel, for which the Court clearly rejected costs. Therefore, although costs are not recoverable by a party attending a hearing for the purpose of instructions to counsel, they are recoverable for a party attending as a witness at hearing or on discovery. Relative to factors affecting pace of case presentation, they had to arrive a few days in advance.
The Plaintiffs' Position
[142] The Plaintiffs noted Bill of Costs and Assessment, supra at p.10.1.15 holding that, relative to travel disbursements, "the jurisprudence is restrictive concerning travel by the client". The Court in Beloit supra at page 92 found that there is "no authority for the proposition that a party-and-party award of costs embraces the travelling and living expenses of the successful party in instructing counsel and attending the hearing, however necessarily they may have been incurred." The Court in TRW Inc. supra, addressing travel disbursements for a party to attend at discovery, found at p. 460 that, although earlier jurisprudence in the Trial Division had approved travel disbursements for a party testifying at the trial, Beloit Canada Ltee supra was binding and the travel disbursements should be disallowed. This latter case does not distinguish between a party as witness versus a party attending to give instructions: it simply holds that no costs are recoverable. The findings in Baker Petrolite Corp. supra are consistent with that.
[143] If costs are allowed for these individuals, they should be subject to the test of reasonable necessity, given that both attended on every day of the trial. Their testimony occurred in the 3rd Trial Portion in 2002 (Norbert Beaujot from the afternoon of Thursday, June 20 into the afternoon of Tuesday, June 25 and Pat Beaujot from Wednesday, June 26 through Thursday, June 27). Noteworthy charges beyond the limits of reasonable necessity are things such as $416.22 and $689.78 for long distance and parking respectively. The Plaintiffs conceded that there is some imprecision in pegging the point in a trial at which witnesses should reasonably arrive at the trial venue.
Assessment
[144] There is no indication in the appeal cases that the Federal Court of Appeal was made aware of Bayliner Marine Corp. supra. In TRW Inc. supra, the issue was not compensation for the client himself being discovered, but for his expense in accompanying counsel for discovery of the other side. The likelihood of oral testimony during an appeal hearing is remote. Therefore, I think that Beloit Canada Ltee supra and Baker Petrolite Corp. supra clearly address circumstances, ie. attendance at the hearing for ongoing instructions to counsel, different from those in Bayliner Marine Corp. supra.
[145] I concluded in the particular circumstances of Lord v. Canada, [2004] F.C.J. No. 430 (A.O.) that:
... [14] By definition, a self-represented litigant must be in court to argue her case, but that does not entitle her to fees under Tariff A3(1) and (3) for the time spent as a witness in her own cause: see Top Notch Construction Ltd. v. Top-Notch Oilfield Services Ltd., [2002] F.C.J. No. 304 (A.O.). I allow nothing for witness fees and witness travel costs. The party travel costs are different because it is essential that a self-represented litigant travel to a trial venue, remote from her home base, to be present every minute to present her case. The time spent testifying would constitute only a portion of that time. If these Plaintiffs had been represented by counsel, I would likely disallow these travel costs completely, but here they had to be present to argue their case....,
and allowed travel disbursements by the parties themselves.
[146] In Top Notch Construction Ltd. supra, the president of the successful defendant claimed for the loss of income for days of missed consulting work because he had to travel to testify at the trial (the defendant was represented by counsel). The plaintiff there argued that, apart from sufficiency of proof and reasonableness of the loss claimed relative to one hour of testimony in a two-day trial, Tariff A3(3) does not authorize normal business charges of a corporation if an employee attends as witness and that, in any event, the president attended as a corporate officer instructing counsel, rather than as a witness. I concluded that:
[7] The evidence supporting the $1,485.00 is a ticket written by Mr. MacNutt on his firm's letterhead for "Missed Work Because of Court". It represents his estimate of his market value as opposed to a confirmed contract, not fulfilled because of his attendance at trial, with some third party. I make no comment on the sufficiency of that evidence for the purposes of Tariff A3(3). Instead, while I am not aware of case law on point, I doubt that provisions in court tariffs for witness expenses, presumably designed to assist in securing the best possible evidence for courts, are intended to address the lost income of litigants. The wording of Federal Court Tariff A3(1) [my emphasis in both examples], "... a witness is entitled to be paid by the party ...", and of Tariff A(3), "A party must pay a witness", implies that a "witness" is distinguishable from the "party" making payment. That concept fits with the historic view of a disbursement as payment out of pocket to a disinterested entity for performance advancing litigation. Further, I do not think that Tariff A3(1) and (3) authorize payment, to the litigant as witness, of some amount for what might have been, but for attendance at trial either as witness or to instruct counsel. In some jurisdictions, such as Schedule IV "A" in the Tariff of Costs to The Queen's Bench Rules of Saskatchewan, the definition of witness in a cause before a court specifically excludes the party of that cause and, if a corporation is a party, an officer of that corporation. That Mr. MacNutt gave evidence for approximately 1.5 hours on the morning of the second day of trial, and likely spent his other time either adjusting his instructions to counsel or preparing to give evidence, are irrelevant factors. I conclude that Tariff A3(1) and (3) do not apply to the litigant as witness in his own cause and therefore I disallow the $1,485.00....
[147] Norbert and Pat Beaujot, as directors of the defendant corporation and apart from issues of their personal status as named parties, would appear to fit the circumstances of Bayliner Marine Corp. supra. At the hearing before me, I told counsel for the Seed Hawk Defendants that, if I were to accept his submissions at face value, ie. that travel disbursements are recoverable for a party as witness at his own discovery and to testify at trial, but not to attend to give instructions, and to allow these claims, I would likely factor them down accordingly. As well, given the fragmented unfolding of the trial, I likely would not allow anything for the first two trial portions because I think that they were unlikely to be called. I intend to do just that, as well as allow travel disbursements for discoveries. As it was not an issue before me, this should not be taken as a precedent for travel disbursements of a party prepared as a witness for trial, but not ultimately called. Those circumstances might be characterized as a mechanism to permit recovery of costs associated with the ongoing instruction of counsel at trial. These allowances are not inconsistent with Top Notch Construction Ltd. supra because of the differing circumstances there.
[148] As required, I apply the same method as I did above for the Scandinavian Witnesses if I find the evidence too obscure for my purposes, ie. such as the August 11, 1994 hotel charge in Edmonton for Pat Beaujot for some unexplained purpose (Mr. Blair's billing statement dated August 31, 1994, includes work on August 12, 1994 to meet with the clients "to review issues," which could address non-essential work). Norbert and Pat Beaujot lived in the postal district of Langbank, Saskatchewan. Brian Kent lived in Saskatoon. It likely was more feasible for Norbert and Pat Beaujot to drive to Winnipeg for certain discoveries and trial, although the evidence is not clear on that point. My rough calculations indicate approximately 880 kilometres roundtrip. My sampling from his expenses sheets discloses rates in 1997 at $0.35 per km and in 2001 from $0.31 to $0.35 per km. That sampling is not exhaustive and is a rough guide only in my considerations. I acknowledge that cost of living factors would affect charges from year to year, but I will apply a rate of $0.30 per kilometre (buses are still feasible options) to account for wear and tear and fuel, meaning $264.00 (880 km x $0.30 per km) for each trip apart from living expenses. I have done this to factor out elements in the evidence for car and fuel which may or may not have been relevant but for which I found the evidence or nexus to be too obscure, ie. trade shows, field tests with experts etc. The references in the evidence to things such as photo finishing are simply too obscure. From what I can discern from the evidence, Norbert Beaujot's living expenses for his discovery in Winnipeg on March 16 to 18, 1998, inclusive, were $715.54 taxes included. Although this includes long distance charges (which could have been necessary) apart from hotel room, meals and parking, the overall amount is reasonable. I allow the $715.54 plus $264.00 for the drive.
[149] Apparently, Norbert Beaujot drove to Calgary for his discovery on March 29 and 30, 1999. The hotel expenses, parking and certain meals totalled $335.31 taxes included, which I allow. The hotel receipt bears a note that the trip totalled 1,880 kilometres, which I accept, meaning $564.00 (1880 km x $0.30 per km). Apart from airfare between major centres, he would have had other costs to travel the approximate 205 kilometres to the closest major centre, ie. Regina, plus taxis and other expenses, if he had travelled by air, so I accept the $564.00. Although there is evidence of food purchases in transit, there is nothing to indicate accommodation in transit. For this trip, I add a modest factor of $150.00 total to account for expenses in transit.
[150] The photocopying of certain expense sheets has inadvertently lopped off information, ie. the month for Norbert Beaujot's discovery in Regina in 1997. It appears to refer to November 25 to 27, 1997, inclusive. There is not much other information for this event. I am sure, as on other similar occasions, that he would have arrived early to observe other discoveries, ie. such as Mr. Halford on November 24 and 25, 1997. I allow $900.00 total.
[151] His expense sheet for the August 2, 2001 discovery in Winnipeg shows $559.81 taxes included, plus $118.00 extra for mileage not a function of a specific number of kilometres. The meal total therein is $71.10 before taxes. The lodging is listed at $213.30 (adjusted downward according to the hotel statement). The hotel statement includes parking charges which do not appear in this expense sheet, although claimed for other trips. The individual net costs total $541.70, but the expense sheet shows $523.42. The source of the adjustment is not obvious to me. The $559.81 includes mileage. There is no one single amount that defines a reasonably necessary total for a trip. I allow $625.00 for this trip. I note that my substitution, at times, of my own figures for these individuals, and for other claims such as the Scandinavian Witnesses above or counsel below, was not done lightly. The materials were voluminous.
[152] In reading the evidence for Norbert Beaujot in 2001, I noted his hotel bill for the evenings of June 23 and 24, 2001 in Calgary, not long after the hearing leading to the Costs Thrown Away Decision and very soon after the filing of the amended pleadings. It bears the notation "lawyer". In other areas of the evidence, hotel rooms for lawyers have been paid directly by the client. It is not clear whether that is the case here or whether this expense is part of his total claim. At that point, his counsel was based in Calgary. There did not seem to be a quick way of factoring such costs from the total claimed, so I decided to generally approach things from the other direction, ie. by identifying relevant trips and attempting to sort out a reasonable total to allow for each. That approach, where necessary, applies throughout the various bills of costs. I could not find much detail for Pat Beaujot. I do not know if he travelled with his brother and stayed in a separate room for his March 18, 1998 discovery starting after his brother's discovery had concluded. Living expenses are a mystery. I am even more mystified as to how costs for Brian Kent's discovery were calculated, but I accept that there were costs. As for costs for exhibit reproduction, subsequent to my decision in Dableh v. Ontario Hydro, supra (T.O.), Mr. Dableh successfully appealed the decision of the trial judge, eventually resulting in the parties appearing before me to tax costs for Mr. Dableh's side of the litigation. My decision, reported at [1998] F.C.J. No. 491 (T.O.), permitted very limited recovery for costs paid directly by the client: see paras. [73] to [94]. The problem with allowances in this area is usually the absence, as here, of indicators of the guidance of supervising counsel for this work, ie. the charge to Pat Beaujot of $213.57 on June 17, 2002 for colour prints and other materials, likely potential exhibits. I allow a reduced and conservative amount of $1,300.00, in addition to the above allowances, to address expenses for Pat Beaujot and Brian Kent in light of my above comments.
[153] As for testimony at trial, I will assume that each travelled by car independently to Winnipeg as the evidence indicates separate room numbers and separate room parking charges. One of them apparently paid $108.00 per night and the other paid $98.00. I apply, for each, the hotel room rate of $111.72 ($98.00 + $6.86 for each PST and GST) used above for Mr. Huhtapalo. I use the daily parking rate of $6.00 ($5.61 + $0.39 GST) reflected in the evidence. I allow $75.00 per day for each for living expenses. I assume that supervising counsel were clear at this point that Norbert Beaujot would testify first and that his testimony in chief would take at least one day. For Norbert Beaujot, I allow $264.00 (car expenses) + $1005.48 (hotel room for June 17 to 25 inclusive) + $54.00 (parking for June 17 to 25 inclusive) + $750.00 (living expenses for June 17 to 26 inclusive). For Pat Beaujot, the imprecision of this exercise makes it difficult to avoid having him arrive just before a weekend, and then sit around. If I allow his travel in the week before his testimony (which actually began on June 26), it only makes sense to allow it from Thursday, June 19 because travel on the Friday would likely preclude testimony on that day. As above, I am not sure that I can point to an example in this litigation of things going more quickly than anticipated. I allow $264.00 (car expenses) + $558.60 (hotel room for June 23 to 27 inclusive) + $30.00 (parking for June 23 to 27 inclusive) + $450.00 (living expenses for June 23 to 28 inclusive). For both men, I have allowed living expenses for their respective days to return home. The overall result is that, for the claimed $23,659.59, I have allowed a reduced amount of $8,229.93.
Disbursements totalling $13,550.26 GST included (trial transcript for the four trial portions) and $3,217.55 GST included (discovery transcript)
The Parties' Respective Positions
[154] The Plaintiffs conceded, in the particular circumstances here of the number of witnesses and the nature of the case presentation and evidence, the reasonableness of paying for trial transcript for the first three trial portions, but not for the 4th Trial Portion in 2003. As said latter transcript would only have been available after the trial concluded, its costs do not meet the test of reasonable necessity for conduct of the defence. That the Seed Hawk Defendants brought a motion for reconsideration of the Trial Decision does not meet that test. The decision of the trial judge dated March 25, 2004 (hereafter the "Reconsideration Decision") dismissed the motion with costs to the Plaintiffs at the high end of Column III and commented at para. [17] that while "the motion is not one whose merit was apparent, it is not frivolous, vexatious or abusive." It is unreasonable to claim $4,244.69 for this transcript, particularly given that it exceeds the probable assessed amount for the Plaintiffs, who were awarded the costs for this motion. The attempt in the evidence to cast it as part of the overall costs of the defence in the action is not acceptable.
[155] The Seed Hawk Defendants argued that certain comments in the Reconsideration Decision establish the necessity for this portion of the trial transcript with particular regard to framing the grounds for the motion:
... [3] I shall deal first with the allegations that the defendants were misled by comments which I made in the course of the trial as to the necessity of amending the pleadings. In the course of argument, counsel indicated that an application for summary judgment would be brought the day after final argument closed on the basis that a necessary element of the invention had not been included in the claims. I indicated that I would not entertain a motion for summary judgment after the close of final argument and that I would deal with the matter "on the merits". The merits, in my view, include the adequacy of the pleadings. There was nothing in the announcement that an application for summary judgment would be made to lead one to believe that it would be accompanied by a motion to amend the pleadings to conform to the evidence. Had notice been given of such an intention to do so, the motion to amend would have been dealt with then and there.
[4] As for the claim that my silence in the face of an offer to amend the pleadings to include the zero till issue as a particular of invalidity misled the defendants, I can only say that if counsel saw the need for amendment, then it ought to have been made. It is for counsel to decide what must be done to advance the client's interest. That burden cannot be shared with the bench by means of an offer to do whatever the Court indicates is necessary....
Notwithstanding the award of costs of this motion to the Plaintiffs, said motion could not have been advanced without first obtaining this transcript. The Plaintiffs benefited by being able to rely on it in responding to the motion. Further, this interlocutory award of costs does not preclude recovery of costs associated with a matter arising out of the Trial Decision and therefore it is recoverable as part of the award of costs of the action in the Costs Decision.
Assessment
[156] I have not outlined the submissions, restricted to the discovery transcript for the examinations of Mr. Beaujot and Mr. Halford in 2001 following the Costs Thrown Away Decision, because they flowed from issues considered and assessed below: I allowed the discovery transcript claims as presented.
[157] Motions brought after judgment are incidental to that judgment and therefore are interlocutory in nature. I do not think that I need to add anything more in the way of analysis of the costs for interlocutory events: see para. [10] of Aird, supra. Although I agree that the Seed Hawk Defendants required this transcript for their motion and I would have allowed costs of the trial transcript for the first three trial portions as a function of the very points conceded by the Plaintiffs, if the Plaintiffs had not acquiesced, the cost for this last trial portion cannot be said to be part of costs of the defence of the action. I acknowledge that part of the motion sought an amendment to the pleadings to make them conform to the evidence, in turn to lead to reconsideration of the judgment on the counterclaim. The Reconsideration Decision considered carefully the doctrine of functus officio. Quite simply, this cost cannot be said to have been incurred to achieve the result in the Trial Decision. However, it can be said to have been incurred to achieve a change to the Trial Decision, by way of motion. The trial judge, in dismissing that motion, precluded any recovery by the Seed Hawk Defendants of the costs of this transcript by awarding costs of the motion to the Plaintiffs. I disallow the $4,244.69 claimed.
Disbursements by the law firms Armstrong Perkins Hudson ($9,275.61 taxes incl.); Ogilvie & Company ($6,540.85 taxes incl.) and Gowlings ($22,896.57 taxes incl.) for photocopies, facsimiles, couriers, long distance, certain travel by counsel, searches, photographic services, postage, US Patent expenses, Canadian Patent expenses, file maintenance and preparation or reproduction of slides, prints, photos, engineering drawings, slides, graphics and video cassettes
Other disbursements by Gowlings ($15, 746.07 taxes incl.) for facsimiles, couriers, postage and long distance
Assessment
[158] The record contains considerable evidence and submissions for these numerous charges, which I will not summarize in detail. The Plaintiffs generally argued that case preparation should have been substantially complete by 2001, as the trial was already underway, save for some additional discoveries. Yet, the charges through Gowlings (counsel subsequent to Mr. Blair) are noticeably larger than through Mr. Blair's two firms. This is simply excessive and well beyond the limits of reasonable necessity. The evidence is scanty and consists of little more than a description such as "colour copies" accompanied by a bald assertion of reasonable necessity. Virtually all of the photos, prints and slides relate to issues of invalidity, for which the submissions above apply. There are gaps in the evidence, ie. an explanation of what was copied, purpose, variance of rates from $0.05 to $1.00 per page etc. The evidence indicates material being produced for lawyers in more than one city because Gowlings is a national law firm: the Plaintiffs should not be saddled with such costs. The claims of $26.62 and $86.15 (postage), compared to the large claims for couriers and facsimiles, emphasize the absence of any attempt at cost-effective options for all disbursements. It may be the prerogative of the Seed Hawk Defendants to retain counsel in multiple cities, but the associated and extra costs, ie. long distance facsimile transmissions etc., are not the Plaintiffs' responsibility. As well, although communications with the client may be warranted, there is no evidence that regular mail would have been inadequate. The approach in Almecon Industries Ltd., supra should be applied here for a substantial discount:
... ¶ 31 I rely on Re Eastwood (deceased), supra, and my approach in Carlile, supra and in Canadian Union of Public Employees, Local 4004 v. Air Canada [1999] F.C.J. No. 464 (A.O.) to resolve these issues. I see the linkages asserted by the Plaintiff, but the proof is less than absolute. Such proof in these circumstances would be prohibitively expensive. The cross-examination of Mr. Dimock on his affidavit produced several comments from him to the effect that the cost of absolute proof of charges in the range of $10, $20, $30 etc. would exceed the actual amount of the disbursements themselves. Mr. Dimock is an experienced practitioner in a competitive area of law and I accept his views on the realities of threshold of proof in litigation. A sense of austerity should pervade costs, but real expenditures are needed to advance litigation: a result of zero dollars at assessment would be absurd. I accept to a point that the Plaintiff faced logistical difficulties. I allow facsimiles as presented at $1,358.05. I reduce photocopies and couriers to $12,000.00 and $3,700.00 respectively....
As well, the Bill of Costs and Assessment, supra asserts that substantial reductions of claims for costs are warranted in the face of gaps in the supporting evidence. There is no authority to claim for the costs of patent searches. The travel charges for a second law firm were unnecessary. Unexplained items such as file maintenance ($26.75) should be disallowed.
[159] The Seek Hawk Defendants noted the bulk of the record and argued that the manner in which disclosure of potential evidence unfolded made it impossible for the initial counsel and experts to adequately prepare. The advent of subsequent counsel did not negate or repeat Mr. Blair's work, but built upon and perfected it. As issues in this litigation were mechanical in nature, photos, videos, slides etc. of machines and their operating parts were essential for the effective and efficient use of the Court's time in receiving the Seek Hawk Defendants' case. The Plaintiffs' position glosses over the realities associated with litigation of a big case, ie. moving a mass of materials to the trial venue and producing them to the other side. The premise in Almecon Industries Ltd., supra should favour the Seed Hawk Defendants here by reflecting the reality of a myriad of essential disbursements for which the cost of proof might or would exceed their amount.
[160] I do not think that counsel, and in particular subsequent counsel, for the Seed Hawk Defendants were extravagant in terms of decisions to incur disbursements. However, I think that the demands of this scale of litigation can interfere with a precise monitoring of limits on costs. I think that the reality was that both sides tried to keep all invoices, chits, statements (this case was instituted 13 years ago) and that memories of the relevance of some of them at the time may have faded over time. As well, my experience is that sometimes irrelevant claims are accidentally included in large cases such as this. Although there is a considerable mass of invoices etc. in the evidence, the proof is less than absolute. The less that evidence is available, the more that the assessing party is bound up in the assessment officer's discretion, the exercise of which should be conservative, with a view to a sense of austerity which should pervade costs, to preclude prejudice relative to the payer of costs. However, real expenditures are needed to advance litigation: a result of zero dollars at assessment would be absurd.
[161] My comments in Canadian Union of Public Employees, Local 4004 v. Air Canada, supra, (A.O.) for photocopies, coupled with the parameters in para. [77] above, reflect my approach below in making a series of allowances for this work ranging from nil dollars to the full amount claimed. I have tried to strike the appropriate balance between the right of the Seed Hawk Defendants to be indemnified for their reasonably necessary costs of the defence in the action and the right of the Plaintiffs to be shielded from excessive costs. This is complicated by entries, such as $222.08 for "colour prints for motion record", which could relate to an interlocutory decision for which costs are not recoverable: in this instance, I disallowed the $220.08 because the number of interlocutory decisions made it difficult to reasonably infer which one might be applicable. The same could be said of the airfare/hotel claim of $2,281.70 for Peter Johnson and Irene Bridger. The Plaintiffs speculated that said charge might address participation of additional counsel on the hearing leading to the Costs Thrown Away Decision. Although the subheading prior to para. 159 in the Beaujot affidavit could be read as claiming for their travel costs for their attendance at discovery, subsequent evidence suggests roles limited to junior counsel for trial preparation and attendance at trial. I am sure that the workload was formidable as the 1st Trial Portion approached, but I was not able to connect these travel costs to specific events. I have addressed Ms. Bridger below. I disallowed the $2,281.70.
[162] On the other hand, although it may be difficult to point to specific points in the Trial Decision for which acquisition of the American and Canadian file wrappers could be said to have been critical, it represented prudent representation of the clients by Mr. Blair in gathering materials that could trigger crystallization of sound defence strategies. I allowed the associated expense, but at a reduced amount because of inconsistencies in the evidence. Mr. Blair's client billing statement dated December 31, 1993, showed a non-taxable disbursement of $261.25 to obtain the file wrapper for US Patent 4,762,075 and parent application file 745,952. His client billing statement dated August 31, 1994, showed $529.62 for "securing and forwarding copy of US Patent 4,762,075 and a copy of each of the references cited on the front of the patent to Mr. Beaujot." I do not think that this passage means that references were cited to Mr. Beaujot, but rather that this material was sent to him. The Plaintiffs need not bear such an expense. I allow only the $261.25. I was cognizant of some differences in conduct once Gowlings was retained, but I do not think my allowances are inflated simply as a function of that occurrence as opposed to focussing on the reasonable necessity for the particular service. I disallow the file maintenance claim. Generally (the allowances for the numerous claims are detailed in the bill of costs as assessed), I allowed somewhat reduced amounts for photocopies, facsimiles, couriers, long distance tolls and travel. I allowed a substantial portion of the claims for colour reproductions, photographs, slides and videos (exhibits). The claims of $9,275.61 (Armstrong Perkins Hudson), $6,540.85 (Ogilvie & Company) and $22,896.57 (Gowlings) are allowed at the reduced amounts of $6,635.68, $2,984.67 and $20,859.32 respectively. The claim of $15,746.07 (other Gowlings disbursements) is allowed at the reduced amount of $13,650.00.
Disbursements totalling $22,158.78 taxes incl. for lead counsel Mr. Macklin to travel to meet with clients and witnesses and attend discoveries and trial
Disbursements totalling $28,084.15 taxes incl. for second counsel Mr. Horne to travel for similar purposes
Disbursements totalling $8,030.89 taxes incl. for second counsel Ms. Bridger to travel for similar purposes
The Seed Hawk Defendants' Position
[163] The Seed Hawk Defendants argued that the various items of travel costs, ie. airfares, accommodation, meals, taxis, parking, long distance, etc. reflect the reality of having to conduct a trial and other hearings remote from one's home base, but in locations precluding the Plaintiffs from having to incur such travel costs for their own counsel. The several revisions to the bill of costs have resulted in various corrections and adjustments to the costs claimed, ie. the withdrawal of costs associated with Ms. Bridger for the June 2001 motion. Paragraph [2] of the Costs Decision sounded the warning that now "comes the time to pay the piper". The Seed Hawk Defendants had to pay those costs in the first instance for conduct of the defence and are now entitled to indemnification by the Plaintiffs of those costs. The Plaintiffs' suggestion of $45.00 per night for hotels is simply not realistic. The change to a different hotel occurred only near the end of trial and did not result in appreciable increased costs, if at all. It facilitated conduct by reason of proximity to counsel for the Simplot Defendant. The trial judge was aware of Ms. Bridger's involvement throughout and his allowance of second counsel includes her disbursements as well.
The Plaintiffs' Position
[164] The Plaintiffs conceded the necessity for both Mr. Macklin and Mr. Horne to attend the trial and acknowledged that there would have been associated costs, but within the parameters of reasonable necessity. For example, the evidence is unclear whether business class airfares are improperly claimed, as opposed to economy fares. The Plaintiffs were able to find reasonable accommodation at about $45.00 as opposed to the $100.00 and up ($150.00 for the Sheraton) per night claimed here. The accommodation claims for Mr. Macklin and Mr. Horne ($7,313.10 and $7,150.08 respectively) are simply presented as block amounts and seem excessive on their face. The evidence indicates that they arrived on October 8, 2001, one week before the start of the 2nd Trial Portion in 2001; that they similarly arrived one week before the start of the 3rd Trial Portion in 2002 and that they arrived about six days before the start of the 4th Trial Portion in 2003.
[165] As throughout the bill of costs, meals records do not break out who was present. Sometimes, taxi claims are lumped together with other cost items. This all contributes to lack of detail in turn making it difficult for the litigant being asked to indemnify these costs to assess their relevance and reasonableness. The claim of $2,548.59 for Mr. Macklin to meet with the clients in Regina on December 3 and 4, 2000, shortly after being retained, seems excessive particularly when coupled with approximately $1,100.00 for Mr. Horne for the same trip. If I accept that a face to face meeting was required, only the costs for one of them should be allowed as it was not reasonably necessary for both of them to make this first trip. A similar submission applies to the Scandinavian Witnesses. As well, the evidence is not clear whether business class was used.
[166] Given the absence of details of purpose, relevance and basis for the charges, items for Mr. Horne such as miscellaneous, taxis and mileage should be disallowed. Some dates for his meal claims do not correspond to discovery or trial dates. The Plaintiffs relied on their submissions above concerning Ben Dyck, an expert never called to testify. Mr. Horne's travel expenses from Calgary to Regina to meet with him in April 2001 should therefore be disallowed. There is no evidence establishing that a telephone conference would not have been sufficient. The Plaintiffs relied on their position above concerning second counsel and asserted that any disbursements associated with Ms. Bridger should be disallowed.
Assessment
[167] The evidence clearly indicates the use of economy airfares in some instances and business class airfares in others. For some flights, it is difficult or impossible to tell: I have applied my experience to the amounts allowed for the latter. I simply cannot agree that a business class fare should be reduced to nil dollars instead of to an economy class dollar amount. Although I think there is some detail in the evidence, I concede the Plaintiffs' point in part concerning the difficulty in evaluating the relevance and reasonableness of some of the claims.
[168] I think that Mr. Macklin's airfares for the three latter trial portions ($457.64, $544.95 and $532.25 respectively) would reflect economy airfares between Ottawa and Winnipeg: I allow them as presented. If I understand the bill of costs correctly, the claim of $7,313.10 addresses his accommodation for these three trial portions. As already noted, I am well aware of Mr. Macklin's considerable experience at the intellectual property bar. I have in mind the difficult or awkward circumstances of coming into a trial mid-stream and then having it become fragmented. I accept his arrival, and Mr. Horne's arrival, one week before the start of the 2nd Trial Portion in 2001 and the 3rd Trial Portion in 2002, but not the 4th Trial Portion in 2003. By 2003, I think that, given the considerable expenses claimed to that point for communications and given the experience of counsel, arrival on the Thursday before was sufficient. I find that Ms. Bridger's presence was essential, at most, two to four days before the start of the latter three trial portions.
[169] I reject the Plaintiffs' submissions concerning $45.00 per night for a hotel. If such bargains are available in urban centres for rooms befitting counsel appearing before a court senior in status in Canada, they are few and far between, in my experience. However, I do accept their point about the move late in the trial to a more expensive hotel: I will apply the rate for the initial hotel. The hotel rates per night have already been identified above, but to reiterate, they are $108.30 ($95.00 + $6.65 for each of PST and GST) for the 2nd Trial Portion in 2001; $111.72 ($98.00 + $6.86 for each of PST and GST) for the 3rd Trial Portion in 2002 and $114.00 ($100 + $7.00 for each of PST and GST) for the 4th Trial Portion in 2003. Relative to Mr. Macklin and in place of the $7,313.10 claimed, I allow $2,707.50 taxes incl. (October 8 to November 1, 2001 inclusive, at $108.30 per night); $2,010.96 taxes incl. (June 10 to 27, 2002 inclusive, at $111.72 per night) and $1,824.00 taxes incl. (January 30 to February 14, 2003 inclusive, at $114.00 per night), totalling $6,542.46.
[170] The claims for Mr. Macklin's meals, local and long distance telephone calls during trial are $1,036.86, $0.70 and $176.50 respectively. There are combined charges as well of $1,099.02, $1,062.86 and $401.59 respectively for meals/taxi for the latter three trial portions. There is a charge of $137.57 for something called travel/telephone. These various items total $3,915.10. If I apply, as I did above, a daily living expense for Mr. Macklin of $75.00 per day throughout the trial, I calculate $1,950.00, $1,425.00 and $1,275.00 respectively for the latter three trial portions, totalling $4,650.00. I could add a factor of $110.00 for taxis for each trial portion. I think that there could have been case-related long distance calls, although I am not sure on the evidence whether all were necessary. Based on that hypothetical analysis, I think that those living expenses as presented for Mr. Macklin for the latter three trial portions meet the threshold of reasonable necessity and I therefore allow them.
[171] Mr. Macklin's meeting with the client, shortly after his firm was retained, occurred in Regina on December 3 and 4, 2000. I would expect the airfare for Ottawa-Regina (Mr. Macklin) to be more than for Calgary-Regina (Mr. Horne). Taking into account air connections likely required to get to Regina, I think that $2,548.59 taxes incl. (airfare, taxi, parking, meals and hotel) are too much to fix on the Plaintiffs. I allow only $2,150.00.
[172] The charges for his travel to Europe to meet the Scandinavian Witnesses consist of $15.00 (parking), $5,817.76 (parking/airfare), $943.23 (meals/hotel) and $71.16 (parking). The evidence clearly discloses a business class airfare for the trans-ocean legs. The use or even availability of business class is not clear relative to regional legs once in Europe. As noted above, I intend to allow only the expenses for one lawyer. I do not think that clients, faced with disallowances by assessment officers of disbursements, should view that as a conclusion that their lawyers have made mistakes. Rather, such results simply represent a difference in the considered opinions of professional legal practitioners and experienced assessment officers. As I commented above, Mr. Macklin's standing is considerable and I am not particularly comfortable in this position of essentially second guessing the decision for both he and Mr. Horne to go to Europe. However, I have decided that, although I think that Mr. Horne was capable of handling this work on his own, to allow the travel expenses, which I find reasonable (accommodation and meals can be very expensive in Europe), of Mr. Macklin for this trip, subject however to an abatement of $1,900.00 to account roughly for the business class airfare.
[173] Accordingly, Mr. Horne's travel costs ($6,868.88 and $619.99) for this trip are disallowed. As for his second trip to Europe, the circumstances surrounding the aborted meeting with Mr. Raber and the Scandinavian Witnesses were unfortunate: I do not criticize Mr. Horne at all. The Scandinavian Witnesses themselves initiated the request for Mr. Horne's presence: an occurrence difficult in the circumstances, even in hindsight, to justify as integral to a successful defence. Apart from that, I do not read the evidence as suggesting that he would have scheduled this trip in any event of a meeting between Mr. Raber and the Scandinavian Witnesses. However, the evidence, although scanty, is that he salvaged the trip (a short one: departure on September 5 and return on September 9, 2001) by arranging ad hoc meetings with several potential witnesses. My inclination is to disallow this claim entirely, particularly given the acknowledgment that opposing counsel could not interfere with access to the Scandinavian Witnesses. Further, the belated interviews that did result were apparently not enough to justify a decision, in the mind of experienced counsel, for a trip for reasons apart from Mr. Raber's scheduled meeting. Balanced against that is the reality that this expense would never have occurred, but for this failed lawsuit. However, as noted above, this lawsuit reflects the right of the Plaintiffs to orderly disposition of their allegations. With regret, I disallow the $6,912.38 claimed.
[174] Mr. Horne's airfares for the August 2, 2001 discovery of Mr. Beaujot and for each of the latter three trial portions, given the dates of issuance, correspond to expected economy fares: I allow them as presented at $600.39, $554.26, $399.11 and $532.71 respectively. The evidence indicates that Mr. Horne needed two nights accommodation in Winnipeg for the August 2001 trip. If I peg that at $216.60 ($108.30 per night) and add that amount to the $6,542.46 calculated and allowed above for Mr. Macklin for the latter three trial portions, the total is $6,758.76 for Mr. Horne's accommodation, which I allow in place of the $7,150.08 claimed.
[175] There is a lengthy series of entries totalling $1,690.88 (excluding $252.27 for meals in Finland, which I disallow) for local and long distance telephone calls, miscellaneous travel expenses, taxis, mileage, parking, and meals. I assume that these address, in part, the four trips above. However, they include things such as $14.92 for a taxi. The bill of costs shows the date as April 12, 2001, which does not correspond to a hearing date or a discovery date. The law firm's computerized disbursement report shows the transaction date as April 12, 2001. By comparison, a travel agent issued his ticket on July 27, 2001, for the flight to Mr. Beaujot's discovery in August 2001 and the transaction date entered for that was July 27, 2001 (another example is the transaction date of April 10, 2001 for his flight on April 11, 2001). I might assume that this taxi was actually taken on April 12, 2001, and was not part of an earlier trip, such as the February 2001 trip to Europe. It likely belongs to the trip ($1,021.85 claimed for airfare) for Mr. Horne to fly to Regina on April 11, 2001, meet with Ben Dyck for a briefing on his expert evidence (already prepared, served and filed at that point) and fly back to Calgary the same day. Given my analysis above for Mr. Macklin's living expenses, I find that this amount of $1,690.88 is a reasonable total for those several trips, regardless of the manner by which it may be calculated and I allow it. It may be that some of Mr. Horne's expenses were paid under a different heading, ie. Norbert and Pat Beaujot, but I have in any event allowed amounts in those areas specific to the individual or thing, which would therefore have factored out anything connected to Mr. Horne. I would expect that the aircraft in service between Calgary and Regina might not all have business class cabins. I allow the $1,021.85 airfare for this April 2001 trip.
[176] I view Mr. Horne's trip in December 2000 to Regina for the initial face to face meeting with Mr. Macklin and the clients in a different light than the meeting in Europe with the Scandinavian Witnesses. This former meeting would have set the stage for the counsel work to come, which would have required the services of more than one lawyer. This was a more efficient way to frame the broad parameters of strategy, regardless of the advanced stage of this litigation. I allow his airfare ($887.03) and accommodation ($83.33). As for the airfare ($316.72) and accommodation ($194.27) claimed for the June 2001 hearing leading to the Costs Thrown Away Decision, my analysis above of interlocutory decisions indicates that, notwithstanding that it was the trial judge hearing the motion, the absence in the Costs Thrown Away Decision of a provision for costs in the cause or for the Seed Hawk Defendants to later raise with the trial judge the matter of costs associated, not with the relief granted, but with the actual hearing of the motion, meant that Mr. Justice Pelletier, at the time he issued the Costs Decision, was functus in terms of reaching back to vary the Costs Thrown Away Decision. Therefore, I disallow the travel claims for the June 2001 hearing.
[177] The bill of costs does not show a separate claim for meals for Ms. Bridger. The amount of $6,789.84 for accommodation is cross-referenced to the same exhibit B to the Beaujot Affidavit as for Mr. Macklin. For Mr. Macklin, there was an amount specific to meals and amounts pertaining to meals combined with taxis. None of this is done for Ms. Bridger. Exhibit B includes meal charges for several people, paid for by the clients as part of the group hotel bookings. This may explain the extent of the living expenses claimed for Mr. Horne. Apart from accommodation, her expenses total $311.07 (local and long distance calls, parking and taxis). I realize that it may be difficult to match individual charges to a myriad of steps stretching back in time for several years. I allow her airfares as presented for the three latter trial portions ($462.46, $380.31 and $87.21 respectively). Following the same approach as above for Mr. Macklin and Mr. Horne, but restricting her hotel stays for the latter three trial portions to October 11 to November 1, 2001 inclusive, June 14 to 27, 2002 inclusive, and February 1 to 14, 2003 inclusive, I calculate $5,542.68 for her hotels. The application as above of $75.00 per day for her meals etc. results in $3,975.00. She surely had to eat, but the evidence is unclear as to how her meals are claimed. Room service meals for her, if any, are not obvious from my reading of the evidence. I simply allow the amounts of $6,789.84 and $311.07 as presented.
Disbursements of $228.00 (accommodation expenses for Seed Hawk Inc.) and $56.87 (meals for Paul Beaumont)
Assessment
[178] These claims address the attendance at trial of Paul Beaumont, who is on the board of management of Seed Hawk Inc. There is nothing to indicate his potential relevance to the outcome. I disallow both amounts.
Disbursements totalling $6,446.12 taxes incl. for research work and time by Dr. Hakansson in March 2001, Quicklaw searches, Maritime Law Books, Carswell, corporate and court searches, Dun & Bradstreet search, binding and office materials
The Parties' Respective Positions
[179] The Seed Hawk Defendants argued that the record discloses nine published decisions, including the Trial Decision, addressing this litigation. These decisions include extensive references to the case law researched online. The record contains voluminous authorities supplied for the Court. The authorities support claims for such costs.
[180] The Plaintiffs referred to Bill of Costs and Assessment, supra and argued that the practice is, in the absence of details of relevance and parameters of searches, to disallow or sharply reduce the claimed amounts. That the Plaintiffs may have used online searches is irrelevant because it is the Seed Hawk Defendants who must prove their costs. The Dun & Bradstreet search cost likely addressed corporate financial particulars and has no place in indemnification for litigation costs. The charges for binding and office materials should be disallowed because they represent a law firm's overhead.
Assessment
[181] Further to my comments above concerning the charge by Mr. Huhtapalo for his time in meeting with counsel in 2001, I think that it stretches the obligations of indemnification, whether the charge is for time of or research by a potential fact witness, to include such amounts in allowable costs. I am not ruling it out absolutely, but I am not convinced in the circumstances here that anything more than the $3,100.00, already allowed above in para. [110] for Mr. Huhtapalo's work, is warranted. I disallow the $891.57 claimed for Dr. Hakansson.
[182] The evidence indicates that the reference in the bill of costs to Maritime Law Books is actually to web usage, presumably case law research in maritime law for precedents applicable to broader areas of law, including intellectual property. The evidence on Carswell is not so clear. The Plaintiffs correctly identified my practice for such items. These two charges, together with the amounts for Quicklaw ($4,650.22 and $27.33) total $4,753.52. This amount may include inadvertent claims for interlocutory events for which costs were not awarded. I allow a reduced amount of $3,800.00 for these four items in total.
[183] There are charges totalling $702.49 for the services of a law firm in Saskatoon to search court records for other actions against the Plaintiffs. This was a recommended precaution by counsel. Apart from the issue of being a full solicitor-client charge introduced via disbursement and therefore sidestepping partial indemnity, I do not see this charge as integral to the defence, regardless of my feeling that it was prudent of counsel to suggest it. I disallow the $702.49. I assume that the corporate searches ($14.98) and Dun & Bradstreet search ($66.34) addressed the financial viability of the Plaintiffs to ultimately satisfy an adverse judgment. Again, I regard this as prudent counsel work in the general operating scheme of a corporation, but I do not accept it as specific to litigation defence strategy. I disallow both amounts.
[184] As for binding materials, I have routinely allowed their costs because I generally view such materials as a non-reusable item specific to the particular case. I allow the $5.89 claimed. The bankers boxes, unless damaged, could be salvaged for another case, unless needed for ongoing storage of records in which case I would be inclined to allow the $11.33 claimed. The purchase of a law book for research for a specific case would be part of overhead, because the book would certainly be of use at some point in the future for a new case. I disallow the $11.33.
Disbursements of $151.94 (copy of Norwegian patent and translation), $257.46 (translation of Norwegian patent) and $731.67 (translation of Norwegian patent)
Disbursement of $780.45 (US patent file prosecution history)
The Parties' Respective Positions
[185] The Seed Hawk Defendants argued further to Foseco Trading AG v. Canadian Ferro Hot Metal Specialties Ltd., [1991] F.C.J. No. 421 (F.C.T.D.) that, notwithstanding the limitations in Canadian law on the use of patent file wrappers in the construction of patent claims, the courts have allowed their limited use in areas of discovery, and of issues of false statements and bad faith, as well as for purposes other than patent construction, ie. such as an admission, and perhaps to show what prior art was considered by the patent examiner. The Norwegian patents related to issues of prior art. The test is not whether they were ultimately used, but whether it was prudent in the circumstances at the time to obtain them. The US patent file wrapper pertained to the US patent file prosecution for Mr. Halford and was relevant for prior art and possible defences and challenges to Mr. Halford's Canadian patent.
[186] The Plaintiffs argued, further to their position above on issues of invalidity, that these charges must be disallowed. Further, the Norwegian patents were not introduced as evidence. The jurisprudence is clear that the file wrapper is inadmissible for the purpose of claims construction and therefore cannot be said to be a reasonable litigation expense. It was the Gowlings law firm who initiated these expenses at an advanced stage for no reasonably necessary purpose.
Assessment
[187] Again, I see merit in the submissions on both sides of this issue. I view these steps much differently than, for example, the corporate searches above. I accept the Seed Hawk Defendants' submissions and allow the charges as presented for the Norwegian patents. The invoice for the amount of $257.46 came from a Norwegian law firm. Those circumstances of full indemnity for the services of a law firm were likely the cheapest way for a Canadian law firm to obtain such material. As for the US patent, the two patents sought were US Patent 4,762,075 and an earlier continuation patent application Serial No. 745,952. Gowlings arranged for the work in February and September 2001, addressed by paragraphs 201 and 202 of the Beaujot Affidavit. Paragraph 161(a)(i) of the Beaujot Affidavit addresses work by Mr. Blair's firm in obtaining US patent copies. They were the same US patents noted above in para. [162]. Given the history of this litigation and the passage of some seven or eight years since Mr. Blair had obtained them, I am not surprised that this material did not make its way forward into the hands of Gowlings. It may be that there were differences in the parameters of the respective requests for the US patent materials. I simply observe that this is likely an example of an unintentional consequence of new counsel coming onboard at a very advanced stage of the litigation. I have already allowed something for this in para. [162]. I do not think that the Plaintiffs need bear any more expense in this area. I disallow the $780.45.
Disbursements of $64.20 (University of Alberta book loan in April/May 2001), $5.35 (computer disk - discovery), $64.20 (Industry Canada file history), $3.28 and $3.28 (customs charges for photos) and $339.30 (rental of laptop computer for one month to prepare written submissions for trial)
Assessment
[188] The Seed Hawk Defendants noted that the photos became trial exhibits. The computer rental reflected the reality of having to conduct a trial remote from one's home base. The Plaintiffs generally argued that these charges were attributable to overhead, lacked detail and should be disallowed as well because they related to issues of invalidity. There is no evidence on which patent was being sought.
[189] The University of Alberta book loan (transaction dates were April 10 and May 3, 2001) could relate to the hearing resulting in the Costs Thrown Away Decision. I disallow the $64.20 claimed. A computer disk is generally reusable at some point: I disallow the $5.35. I allow the $64.20 for the file history search. I allow both amounts of $3.28. The rental of the computer is a one-time cost attributable only to this litigation, but I think that I have sufficiently addressed these circumstances in my allowance above for the Pitblado account: I disallow the $339.30.
The Simplot Defendant's Bill of Costs as to Trial
Counsel Fees totalling $201,608.00 (before taxes) for items 2 and 3 (preparation and amendment respectively of defence); several items 5 and 6 (preparation of and attendance on motion respectively); item 7 (discovery of documents); several items 8 and 9 (preparation for and attendance on discoveries respectively); several items 10 and 11 (preparation for and attendance on pre-trial conference or mediation respectively); item 12 (admission of facts); items 13(a) and 13(b) (preparation for first and all subsequent days of trial respectively); item 14(a) (attendance at trial); item 15 (preparation of written argument); several items 24 (travel by counsel to various hearings: already addressed above and disallowed); item 25 (services after judgment); item 26 (assessment of costs); item 27 (brief client on trial decision) and item 28 (36 hours for second counsel/student attendance on discovery November 23 - 27, 1997)
The Simplot Defendant's Position
[190] In addition to the specific order in para. [63] of the Costs Decision above, the Simplot Defendant noted these considerations in the Costs Decision:
... [56] Accordingly, in reliance upon Rule 400(3)(e), I award Simplot its costs throughout at the top end of Column IV, save for those motions brought by other parties where Simplot either simply kept a watching brief or adopted the position advanced by the Seed Hawk defendants. Without disputing that Simplot was entitled to take part in those proceedings, the plaintiffs should not have to pay a premium for attendances which represent a certain amount of duplication. In respect of those motions, Simplot's costs will be taxed at the midpoint of column III. To avoid any confusion as to the scope of this exception, it does not include motions made in the course of the trial.
[57] For the same reasons as I identified in relation to the other parties, Simplot's costs are to be assessed without awaiting the outcome of the appeal of the trial decision, and are payable upon being assessed....
[191] The Simplot Defendant argued that the Plaintiffs' assertions of a limited role for it, ie. being sued for contributory infringement and not full infringement and simply incorporating the Seed Hawk Defendants' defence on issues of infringement and invalidity, are irrelevant in light of the findings by the trial judge and completely misunderstand the strategy and work involved. The trial judge weighed carefully the evidence and submissions and awarded the Simplot Defendant an elevated scale of costs. The Costs Decision commented in particular:
... [55] In my view, the plaintiffs were entitled to stand on their position that Simplot ought not to assist in the promotion of a device which they believed infringed their patent. When Simplot agreed to cease supporting the Seed Hawk device until the issue of infringement had been resolved, as it did in its December 29, 1993 offer, the plaintiffs had achieved what they always claimed was their primary objective: the protection of their patent. On the basis of the material before me, it does not appear that the plaintiffs responded to this proposal. It is true that this offer fell below the plaintiffs' monetary expectations but they were being offered essentially the same terms as Simplot had given Seed Hawk. Simplot's offer represented as much compromise as one could achieve without total capitulation. It was worthy of a response. Had they accepted it, the plaintiffs would have achieved an important objective and would have saved themselves and Simplot significant sums of money. The failure to respond to such a proposal is a sufficient reason to increase the scale upon which Simplot's costs are to be taxed....
[192] The Simplot Defendant argued that contributory infringement by necessity has two elements. First, the Plaintiffs had to prove infringement by the Seed Hawk Defendants. Second, they then had to prove that the Simplot Defendant had induced, aided or abetted said infringement. The material consequence is that the Simplot Defendant had to involve itself in the Seed Hawk Defendants' defence to ensure proper conduct, and if necessary take part, but without undermining its co-defendant. The Simplot Defendant was successful on both elements.
[193] The Simplot Defendant noted that the amendment to the statement of claim consisted of about six words, but those words were not minor matters in that they added six new infringement claims. The $770.00 claimed for item 3 is small given the careful research and preparation required relative to the issues.
[194] The Simplot Defendant noted that there were three grouping of motions: (i) those occurring orally during trial and without a specific award of costs; (ii) those occurring outside trial and in which it took an active part, for which it gets top end Column IV costs, and (iii) those outside trial in which it did not actively participate, but did attend on a watching brief, for which it gets midpoint Column III costs. However, any award of costs by a motions judge takes precedence. If the motions judge did not award costs, then the Simplot Defendant as the successful party in the judgment gets costs.
[195] The Simplot Defendant argued that the Trial Decision and the Costs Decision together have detailed the parameters of costs, ie. the specific circumstances for maximum Column IV or midpoint Column III costs, and therefore I do not have any additional discretion to reduce or restrict its costs. The conclusions in Mitchell v. Canada, supra permit the maximum Column IV claims presented here. For example, the April 6, 1999 order, dismissing the Simplot Defendant's motion for summary judgment, awarded costs in cause, meaning that its success in the judgment entitled it to maximum Column IV costs. The Costs Thrown Away Decision did not specifically address costs of the motion, but said that costs became subsumed in the cause itself and therefore the disposition of the latter created the entitlement by both the Seed Hawk Defendants and the Simplot Defendant to motion costs as a result of such orders.
[196] The Simplot Defendant argued further to Bill of Costs and Assessment, supra that the need for discovery of both sides means that multiple item 8 and 9 claims are warranted. The Simplot Defendant is entitled to claim item 8 preparation for each witness, but only claims it once per witness regardless of the number of times a witness was examined. Each instance of attendance, per hour, is claimed. As part of the necessity to ensure the sufficiency of the Seed Hawk Defendants' conduct of their defence, the Simplot Defendant had to prepare for and attend on each of the former's discoveries. Although the Simplot Defendant did not sue the Seed Hawk Defendants, there were disclosures in the evidence putting the former adverse in fact, the most important one being the agreement, which the Plaintiffs asserted as a key element of the contributory infringement, by which Beaujot Holdings agreed to indemnify Seed Hawk Inc. from anything arising out of the cross-marketing agreement.
[197] The Simplot Defendant noted Rule 236(1):
236. (1) When examination may be initiated - Subject to subsection (2), a party may examine an adverse party for discovery only if
(a) the pleadings are closed and the examining party has served its affidavit of documents;
(b) the pleadings are closed and the adverse party consents to the examination being conducted before the examining party has served its affidavit of documents; or
(c) the adverse party is in default of serving and filing its pleadings and leave of the Court has been obtained.,
and argued that it does not distinguish between parties adverse in interest and adverse in fact. Some superior courts have held that being adverse in fact is sufficient for status at discoveries. However, the critical considerations, regardless of the Plaintiffs' opinion as to what should have been a sufficient defence, are the relationship and state of communications between the Seed Hawk Defendants as infringer and the Simplot Defendant as contributory infringer and the resultant need for the latter to participate in the former's defence, including the discoveries throughout. However, the distinction between the respective defences is still apparent and is highlighted, for example, by the direct examination during the 3rd Trial Portion in 2002 of Norbert Beaujot, a principal of the Seed Hawk Defendants, by counsel for the Simplot Defendant. The Plaintiffs' position ignores the reality that, regardless of the potential for adversity in relationship between co-defendants, the core consideration was the appropriate defence for issues of contributory infringement. That there were not any notices of contribution and indemnity between co-defendants here did not lessen the work by counsel for the Simplot Defendant in evaluating all avenues of defence, including those arising from discoveries involving the Seed Hawk Defendants.
[198] The Simplot Defendant, for the item 10 and 11 claims (case conferences), argued that I am restricted to allowing maximum Column IV amounts, reflecting the punitive considerations of the Court relative to the settlement offers, for this real and necessary work. The conferences may have been brief, but the underlying work was substantial and reflected the complexity and continually shifting aspects of this litigation. The Plaintiffs' assertions here of disproportionate claims are absurd, particularly when compared to their request, at the hearing leading to the Costs Decision, of some $237,000.00 for the work of a patent agent on the losing side of this case. The Simplot Defendant has caused the least burden of costs in this litigation, but is entitled to claim these fee items.
[199] The Simplot Defendant led submissions similar to those above by the Seed Hawk Defendants, ie. the circumstances of the litigation warranted a fresh item 13(a) claim (preparation for first day of trial) for each of the four trial portions. The Plaintiffs' evidence is not necessarily complete concerning actual hours in court, ie. breaks, ending times etc. As for the November 9, 2000 item 13(b) and 14(a) preparation and appearance claims respectively, it can be inferred that counsel had to prepare submissions to assist the trial judge in salvaging the trial further to Mr. Blair's unfortunate collapse. As well, the record discloses inadequacies in Mr. Blair's cross-examination at trial. Counsel for the Simplot Defendant, during the 1st Trial Portion in 2000, therefore had to conduct cross-examination in a manner partly compensating for these deficiencies by focussing on matters associated with allegations of infringement by the Seed Hawk Defendants. An additional consideration was the burden, as a function of potential harm to the Simplot Defendant's case, of extra work to prepare for the Plaintiffs' anticipated first expert, J. Harapiak, because of the possibility of continued inadequate cross-examination by counsel for the Seed Hawk Defendants. The Simplot Defendant did not have as large a role as the other parties, but it did perform considerable work during the break in the 2nd Trial Portion in 2001 (Wednesday, October 17 to Friday, October 19, 2001 inclusive) mandated by the trial judge for the parties to work at revising various experts' reports.
The Plaintiffs' Position
[200] The Plaintiffs relied generally on their submissions above concerning the Seed Hawk Defendants' bill of costs (counsel for the Plaintiffs indicated that there was no objection to items not specifically referred to in his oral submissions). If the trial judge had intended the maximum value in the available counsel fee items, he would have so stated. Therefore, I retain jurisdiction to allow something less than the maximum value. For example, the amended defence simply adopted the assertions more particularly set out in the Seed Hawk Defendants' amended pleading. Therefore, item 3 warrants only something less than the maximum $770.00 claimed.
[201] The Plaintiffs objected to the oral application before me by counsel for the Simplot Defendant to add item 5 and 6 claims for the appearance in Regina on June 8, 2001 (the Costs Thrown Away Decision) because it is simply too late to add such claims. Alternatively, the Simplot Defendant should be limited to mid-point Column III costs or even nothing at all because its counsel was essentially on a watching brief, ie. if the Seed Hawk Defendants successfully obtained the relief sought, it would follow that the Simplot Defendant would also be permitted to amend its pleadings and productions. The Plaintiffs objected to the item 6 attendance fee in January 2001 for the Plaintiffs' contested motion for an early trial date because said matter was contested on the basis of written materials (after counsel for the Seed Hawk Defendants interjected to note that the item 6 claim in their bill of costs might be subject to similar objection, counsel agreed to let me sort it out by recourse to the court record as to whether there were appearances).
[202] The Plaintiffs conceded further to Bill of Costs and Assessment, supra that item 8 preparation can be claimed more than once, ie. for the discovery by the Simplot Defendant of the Plaintiffs' representative, Mr. Halford, and again for the discovery by the Plaintiffs of the Simplot Defendant's representative, Lyall Smith. However, the Simplot Defendant, whose counsel did not even pose questions, cannot claim items 8 and 9 (preparation and attendance respectively) for the discoveries by the Seed Hawk Defendants of Mr. Halford and for the discoveries by the Plaintiffs of the Seed Hawk Defendants' principals, Norbert and Pat Beaujot. There was no cross-claim asserted between these co-defendants and there was nothing in the pleadings to suggest adversity in interest. Alternatively, if something is allowed, it should be for less than the maximum. It is not clear in law whether counsel for the Simplot Defendant would have had any standing to ask a question on discovery. Norbert and Pat Beaujot had very little to do with the Simplot Defendant, and Brian Kent nothing at all. The Simplot Defendant, as a party, was entitled to be present, but that did not create an entitlement to item 8 and 9 costs.
[203] The Plaintiffs clarified their submissions above concerning items 10 and 11 (preparation and attendance respectively) for case conferences by conceding that it may be technically correct to characterize any conference prior to trial as a "pre-trial conference", but noting that this latter term contemplates more substantive work than the conferences here which simply and briefly addressed procedural matters. Again, if their actual durations are added up, the total time and amount claimed are excessive for the actual work required. It works out to more than the entitlement for discovery work. The tariff was not intended to permit such results. There is residual discretion to remedy this.
[204] The Plaintiffs relied on their submissions above for the Seed Hawk Defendants concerning the claim for item 13(a) (preparation for first day of trial) for each trial portion. There is residual discretion to find that, as a function of what actually occurred day to day during the trial, the Simplot Defendant was largely on a watching brief and therefore should be limited to something less than the maximum Column IV costs. The Plaintiffs conceded limited instances of full involvement by counsel for the Simplot Defendant creating an entitlement to the higher amount of costs, ie. the cross-examination of Mr. Halford by Mr. Riedel (November 8) in the 1st Trial Portion in 2000. Nothing is allowable for preparation for November 9, 2000, as counsel simply attended in court to apprise the Court of Mr. Blair's unfortunate situation and to obtain an adjournment: no preparation was required for that. The Plaintiffs' evidence concerning Mr. Blair's breakdown should be preferred because it was much more detailed than that of the Simplot Defendant.
[205] The Plaintiffs asserted several other examples of the need for only limited or no participation by the Simplot Defendant during trial, ie. the evidence of Mr. Huhtapalo on prior art. The Plaintiffs outlined a series of dates for which it might be said that the Simplot Defendant was fully engaged. They conceded that counsel for the Simplot Defendant was fully engaged for closing arguments in the final three days of trial. The allowances for item 13(b) preparation throughout the trial should be reduced for those days not requiring full or any engagement by the Simplot Defendant. Nothing is allowable under item 14(a) for lunch breaks. Costs for brief recesses when counsel must remain in or close to the courtroom are allowable. The Plaintiffs generally relied on their submissions above concerning items 25 and 28.
Assessment
[206] I have not summarized the submissions concerning the allowability of costs associated with issues of invalidity. They built upon those above and have been sufficiently addressed. It may be that a passive watching brief as a defence strategy may work in some circumstances. I think that the unfortunate circumstances of Mr. Blair's situation demonstrated, without the need for any further analysis on my part, the potential risk for one's interest in that approach. I accept the Simplot Defendant's position on the necessity for ongoing case preparation, at times in conjunction with that of the Seed Hawk Defendants, with however its own interest paramount at all times. The tariff itself, if confined to the default parameters of Column III costs as afforded by Rule 407, does not provide me with a lot of flexibility to account for the differences in demands of litigation of this sort versus more straightforward matters. However, that consideration is irrelevant here because the Costs Decision addressed such concerns in its provision for costs at specific points in the Columns. My conclusions above concerning the meaning of the phrase "at the high end" apply to the Simplot Defendant as well. I allow item 3 as presented.
[207] From what I can glean from the record, after the order dated November 9, 2000 adjourning the trial sine die, the trial judge convened a case management teleconference lasting 30 minutes on December 5, 2000, with counsel for all parties (the Simplot Defendant's bill of costs asserts item 10 and 11 claims for December 7 and the Seed Hawk Defendants' bill of costs does not claim anything). The trial judge then adjourned that conference to January 5, 2001. Correspondence on the record indicates that potential trial dates were discussed on December 5, 2000. The case conference on January 5, 2001, proceeded via teleconference again with counsel for all parties. Tentative dates for resumption of the trial in July 2001 were set aside and another conference was scheduled for March 26, 2001.
[208] On January 12, 2001, the trial judge informed counsel that scheduling conflicts would delay resumption of the trial until October 2001. The Plaintiffs then led a motion in writing, which was dismissed by order silent as to costs, for an order for resumption of the trial on the earliest possible date. Neither the Simplot Defendant nor the Seed Hawk Defendants claimed item 10 and 11 costs for the January 5, 2001 case management teleconference. The record indicates that, on March 23, 2001, the Court rescheduled the March 26, 2001 conference to May 9, 2001. The conference proceeded on this latter date. Both (the Simplot Defendant and the Seed Hawk Defendants) claimed items 10 and 11 for March 26, 2001, but not for May 9, 2001. Both claimed item 5 and 6 (preparation and appearance respectively) fees relative to the Plaintiffs' motion for an early resumption of trial and both, before me, withdrew the item 6 claim because it may have inadvertently and incorrectly been claimed. My comments above in Aird, supra indicate the limits of my jurisdiction in the face of orders silent as to costs. However, the bottom line is that I am left with an item 5 claim in each bill for $990.00, a sum which would otherwise be about equivalent to their entitlements under items 10 and 11, if each had correctly advanced claims under items 10 and 11. This confusion is understandable in a case of this magnitude and duration: I have simply allowed the $990.00 in both bills of costs under item 5.
[209] My comments in Bill of Costs and Assessment, supra indicated that items are sometimes added ad hoc to bills of costs. An example is item 26 (assessment of costs). Often, it is not included in the initial version of the bill of costs served between the parties with a view to inducing settlement of issues of costs. It may not even be in the version led before the assessment officer because Rule 408(3) provides specific details of the jurisdiction to allow or refuse the costs of an assessment to either party. I have seen item 26 listed in a bill of costs, but without any corresponding listing of an amount claimed, because counsel want to wait until the assessment has unfolded before proposing an amount. Thus, I do not think that the Plaintiffs would have been unduly prejudiced by the addition of item 5 and 6 claims for the costs thrown away hearing. Those considerations are, however, moot in light of my conclusions above: the Costs Thrown Away Decision did not award costs of that motion at the time to the Defendants. Further, since the Costs Thrown Away Decision did not specifically reserve to the trial judge any further jurisdiction on the matter of costs for said motion, it is irrelevant whether Mr. Justice Pelletier was the judge for said motion and the judge at trial: in his latter role, he was functus in terms of purporting, as the Defendants urge me to find, to revisit costs provisions for the costs thrown away motion. Nothing is allowable. For greater clarity, I note that the costs thrown away hearing could not be said to have occurred while the trial was in session because it occurred during the hiatus directed by the November 9, 2000 trial adjournment order. Paragraphs [11] to [14] of the Costs Thrown Away Decision do not persuade me otherwise.
[210] I appreciate the Plaintiffs' premise concerning the amount of money represented by the item 10 and 11 claims. However, as noted above, the trial judge has spoken via the Costs Decision. These were discrete appearances for which the Simplot Defendant is entitled to claim costs. It is not sufficient to hold that its counsel was merely on a watching brief and that counsel for the Seed Hawk Defendants essentially carried conduct of the defence. I allow these claims as presented. My findings are similar for the item 8 and 9 claims. In these circumstances, I simply cannot conceive of a professional legal representative of Mr. Riedel's experience advising his client that nothing of substance need be done relative to discoveries between the Plaintiffs and an independent co-defendant. I allow the item 8 and 9 claims as presented.
[211] Consistent with my conclusions above for the Seed Hawk Defendants, I allow only a single item 13(a) and I reduce the other item 13(a) claims to item 13(b) limits. Counsel could only speculate as to what the Court might do on November 9, 2000, faced with news of Mr. Blair's problems. Given my conclusions to this point on the demands of defence strategy upon counsel for the Simplot Defendant, I accept the argument that he had to be fully engaged throughout. I have consistently held that counsel must be in court some time before the scheduled start or resumption times to permit the court registrar to satisfy herself that the hearing is ready to go. I consider that integral to attendance. I compared the court file's abstract of hearing, the Seed Hawk Defendants' asserted hours for item 14, those of the Simplot Defendant, Mr. Halford's evidence and information in the trial transcript.
[212] Consistent with my analysis above, I allow item 25 as presented, but disallow item 27. I considered circumstances for allowing item 28 in Air Canada v. Canada (Minister of Transport), [2000] F.C.J. No. 101 (A.O.). I doubt whether I can effectively allow second counsel on discovery (the parties' respective submissions on this issue are detailed in the record). I disallow item 28 (claimed at $3,960.00 for 36 hours).
Disbursements totalling $70,720.65 plus applicable taxes
The Simplot Defendant's Position
[213] The Simplot Defendant noted that a series of entries in the bill of costs for November 27, 1993 to May 27, 2003 total $4,117.23 taxes incl. and roll up essential costs for photocopies ($0.25 per page), long distance, long distance facsimiles, couriers, postage, Quicklaw, electronic case management fee and folders. These are additional to other claims in the bill of costs. The rather low total of $65.53 for postage over ten years likely reflects the tendency to not bother entering every regular postage charge as opposed to larger registered mail charges elsewhere in the bill. Many, but not all, records were put in evidence as it sometimes can cost more to prove an item than the item is worth, but there is a pattern of modest claims on the face of the bill of costs when compared to other claims such as by the Plaintiffs, ie. $2,500.00 as compared to $50,000.00 by the Plaintiffs for in-house reproductions. This was lengthy and difficult litigation for which it would be inordinately expensive to prove, for example, each and every photocopy. The law firm's billings to the client are in the record. It would be unreasonable to generally read down expenses simply because they may seem large. Some perspective is needed both to appreciate what work was reasonably necessary to conduct the defence and the reasonable degree of effort to prove minute details of each item of costs. The $3,922.00 + taxes paid in May 2003 for trial transcript is reasonable for reasons advanced above by the Seed Hawk Defendants and given that the trial judge also ordered it for the last trial portion.
[214] For the mileage (no airfare) and living expenses ($3,921.09 + taxes) for counsel for the Simplot Defendant during the 2nd Trial Portion in 2001, the test is what is reasonable in the circumstances and not what one person, ie. Mr. Halford, says it should be. His evidence disclosed what he paid for accommodation, but not the general availability to the public of corporate or government rates. The Simplot Defendant throughout applied government travel standards for accommodation and other items of travel costs. Although the Seed Hawk Defendants did need an office in Winnipeg to stage their case, the Simplot Defendant made do with the hotel room in the Sheraton (approximately $135.00 per night).
[215] It is convenient to simply reproduce certain written submissions advanced by counsel for the Simplot Defendant (from his document dated and filed June 27, 2005, before me):
... 23. Simplot had scheduled four witnesses for trial as follows:
a. Ross Harvey of AdFarm, Calgary Alberta, as an expert witness on advertising;
b. Lyall Smith of Brandon Manitoba, Manager Simplot Liquid Solutions, marketing manager, primary representative for the client and fact witness;
c. John Malinowski of Boise Idaho, Manager Sales and Marketing for Simplot and fact witness; and
d. Ken Mudry of Waterloo Ontario, former member of Simplot Sales and Marketing department in Brandon.
24. Lyall Smith attended throughout the entire trial as the client's representative and as a fact witness.
25. The initial plan for trial was that Simplot's witnesses would appear in the third week of a three week trial. Because of Seed Hawk's counsel's illness the trial ended in the first week. Simplot's witnesses were cancelled and Simplot incurred nor claims any travel expenses for its witnesses other than Smith.
...
26. The second sitting of the trial commenced 15 October 2001 and was scheduled for three weeks. Again Simplot's witnesses were scheduled in the last week. Again, the plaintiffs and codefendants did not complete their evidence and again Simplot's witnesses were stood down. Simplot incurred nor claims any travel expenses for its witnesses other than Smith.
...
27. The third sitting of the trial commenced 17 June 2002 and was scheduled to be completed in two weeks. Simplot was unable to obtain any meaningful estimates from plaintiffs' counsel as to the extent of time they would take in direct or cross examinations of witnesses but it was likely Simplot's witnesses would appear in the second week and accordingly Mudry was flown in from Waterloo, Malinowski from Boise and Harvey from Calgary arriving on Saturday June 22, 2002. Witnesses were released Thursday June 27th when it became obvious that there was insufficient time to have any of them testify. Simplot incurred expenses for all witnesses.
...
28. The final phase of the trial started on February 3rd, 2003 and was scheduled to run for three weeks. Once again plaintiffs' counsel would not commit themselves to providing any estimates as to how long they would be in their cross examination of Dr. Anderson who was scheduled as the first witness at this sitting and making it difficult to predict when Simplot's witnesses should be scheduled to fly in. Eventually Ross was scheduled to fly in on February 5th and be available until February 7th. Mudry was scheduled to meet with counsel on February 2nd and to be available to give evidence until February 5th. Because of time constraints to leave time for the plaintiffs' rebuttal case and for final argument, Malinowski was cancelled as witnesses [sic].
...
29. Simplot submits that it be assessed costs in favour of two appearances for each of Mudry and Harvey notwithstanding they only testified at the last appearance. Simplot submits further that it be assessed costs for the appearance of Malinowski notwithstanding that eventually he was cut as a witness.
30. Halford's comments respecting subsequent adjournments at paras 35 to 42 of his affidavit merely attempts to deflect the blame for the delays from the plaintiff to the Seed Hawk co-defendants. He states that "I do not believe that it was the fault of the plaintiffs" (para 38) and that while he felt that he disputes that the plaintiffs were "noncommittal" as to trial timings, the fact is that the plaintiffs were while the co-defendants at least were prepared to make estimates. Halford states "As such it was extremely difficult for any party to predict, with any certainty, when it would be completing their case" (para 40).
31. The point however is not whether or not the plaintiffs are to blame for the adjournments. It is submitted that the true questions are:
a. Did Simplot incur reasonable expenses of litigation as a result of the adjournments?; and
b. Was it reasonable at the time for Simplot to incur expenses?...
33. Secondly, the assessment officer should look at what was reasonably necessary to advance the client's case at the time - not what should have been done by hindsight.
... Ultimately, the Federal Court of Appeal was not unanimous in disposing of the issues but the measure for this and any item is not applied in hindsight but rather as the gauge of the effort required at the time for prudent representation of the client. This must be balanced against the notion that litigants need not indemnify their opponents' professional representatives to educate themselves generally on the law as opposed to the permissible research relevant for the subject litigation. The test for the value assigned should be neutral. That is, it is not relative to difficulty for or effort by an individual solicitor because those variables exist in a continuum by experience and locale but rather, in the context of litigation generally, what were the challenges and consequences of the subject litigation.... (Emphasis added)
Carlile v. The Queen, 97 D.T.C. 5284 at 5285
34. Ultimately even Halford agrees that it was difficult to judge how long it would take for parties to complete their cases. At all times parties were under tight time constraints to finish the case within the time allocated for each sitting. Simplot's position throughout was that it would be the third party to present its case in chief and that further there would be further evidence after Simplot's case was finished.
35. It is trite to say that a party must have its witnesses ready to testify when it's time to enter its case arrives. It is equally trite that when witnesses come from outside the province of trial, that travel time and arrangements require that the witnesses may have to have waiting time in order to ensure their timely presence. In each case that the witnesses were brought to testify, it was on the strong likelihood that they would be required. Simplot should not bear the costs of their attendance when it was as a result of the other parties cases not being completed, and no fault of Simplot's, that resulted in their being unable to testify.
36. The plaintiffs lost the case both on infringement generally and also on contributory infringement as against Simplot specifically. The result is that the plaintiffs have become liable for the reasonable costs and expenses of Simplot's which in this case include multiple appearance of witnesses....
[216] Mr. Harvey testified for most of the day on February 6, 2003. He submitted two invoices for his professional time and travel expenses, ie. $5,121.19 for June 23 to 27, 2003 and $2,812.21 for February 5 to 7, 2003, which are modest if compared to other experts, ie. $14,830.45 for one of the Plaintiffs' experts submitted in the draft bill of costs in the motion record and considered in the Costs Decision. By the time of trial, Mr. Mudry had left the Simplot Defendant and moved to Ontario to work for the Waterloo Oxford Co-operative Inc. in Elmira, Ontario. He testified on February 5, 2003. His invoice of $3,754.12 for June 22 - 27, 2002, includes his travel expenses and a claim of $2,500.00 for compensation for wages. His invoice of $2,714.83 for February 1 to 8, 2003, includes his travel expenses and a claim of $1,750.00 for Perdium [sic]. Mr. Mudry sought and was paid for his lost wages. Mr. Malinowski's travel expenses for June 2002 total $3,460.87 (airfare = $2,302.60, hotel June 22 - 27 = $884.06 and meals = $274.21). The decision to not call Mr. Malinowski in the final trial portion was made in circumstances which included the caveat by the trial judge, who by this time had already been elevated to the Federal Court of Appeal, that there would be no further extensions of the trial. The expenses for Mr. Smith as a fact witness are allowable in law. Several witnesses, including Mr. Smith, were scheduled for discovery in 1997 and therefore $1,037.62 were included for his travel costs, although time ran out before he could be examined.
[217] The Plaintiffs' submissions concerning Mr. Huhtapalo are irrelevant because he would have preceded the Simplot Defendant's witnesses in any event. An experienced lawyer does not have witnesses sit around needlessly, but he does have an obligation to preclude delays and waste of valuable sitting time. The conclusions in Thakore, supra are not relevant here because improper conduct by counsel is not an issue here. The time available in June 2002 for Mr. Malinowski to testify simply ran out and the trial judge's subsequent and stringent time constraints affected the decision to not ultimately call him. Those circumstances are very different from Thakore, supra.
[218] The Simplot Defendant, relative to Mr. Mudry, argued that the presence of a subpoena is irrelevant because the key consideration is simply Tariff A3(1) and (3) for the expenses of a witness. Mr. Mudry was not an employee or salaried worker, but a general manager claiming for loss of wages at $500.00, which fits the wording of Tariff A3(3), ie. "... may pay a witness, in lieu of the amount to which the witnesses is entitled under subsection (1) or (2), a greater amount equal to the expense or any loss incurred by the witness in attending a proceeding." The term Perdium [sic] is misspelled and perhaps misused, but his circumstances had not changed during the 4th Trial Portion in 2003 in terms of his loss of wages.
[219] If the $1,789.53 for the November 1997 discoveries in Regina for travel costs for lead counsel (W.W. Riedel, Q.C.) and D. Swayze, his articled student/second counsel are to be reduced to factor out costs associated with Mr. Swayze, then full mileage costs should be left intact for Mr. Riedel and the following calculations should apply. The mileage charge allowable is 700 km (roundtrip Brandon-Regina) x $0.25 per km = $175.00. Then, subtract $175.00 from $1,789.53 leaving $1,614.53. Divide $1,614.53 by two equalling about $807.00 isolated for Mr. Riedel's living expenses, which when added to $175.00, gives $982.00 as an allowable total for this trip. Relative to concerns for the March 1999 and September 1999 discoveries, counsel never flew business class. The economy fares at that time were about $1,100.00. The airfare claimed for the September 1999 trip is one-half of that because the trip was also used for work on behalf of another unrelated client. The charges by the firm Law Reporting ($1,259.95 on December 13, 2000 for transcript and $1,296.00 on August 7, 2001 for trial transcript) are not double billing as they were separate billings for items with different descriptions, amounts and dates.
The Plaintiffs' Position
[220] The Plaintiffs argued generally that any comparison to their draft bill of costs before the trial judge, for the purposes of the Costs Decision, is not valid because of the absence of details as to the breakdown between issues of infringement and invalidity. The Plaintiffs noted that, apart from specific items isolated for discussion before me, I should generally scrutinize the Simplot Defendant's bill of costs to reduce or disallow unreasonable costs in my discretion, ie. excessive hotel rates, airfare, overhead, etc. Relative to the $4,117.23 for the series of charges from November 27, 1993 to May 22, 2003, the Plaintiffs conceded that absolute proof may not be possible or cost-effective, but argued that there is a large gap between absolute proof and no proof at all. For example, the evidence for photocopies is simply an amount entered in the client billing statement apparently at $0.25 per page. This amounts to some 10,000 copies, which is not necessarily outrageous in the circumstances, given that the figures for the other parties are significantly higher. However, the Simplot Defendant's role demanded significantly less document reproductions and therefore warrants a modest reduction given the absence of information for what was copied and purpose. The same argument applies to facsimiles and couriers. The electronic case management fee ($25.00) and folders ($35.00) should be disallowed as overhead.
[221] The Plaintiffs conceded that Mr. Riedel had to attend the discoveries in November 1997, but costs associated with Mr. Swayze should be disallowed. The charge of $1,102.00 in March 1999 (discoveries of Norbert Beaujot and Brian Kent) seems excessive for a Winnipeg-Calgary roundtrip, particularly if compared to other economy fares. Relative to costs associated with the September 1999 discovery of Mr. Halford, the record indicates that Mr. Riedel also did work on this trip for another client unrelated to this litigation and therefore the costs should be apportioned accordingly as the record does not confirm that occurred. As above for the Seed Hawk Defendants, the circumstances of the trial warranted purchase of the trial transcript for the first three trial portions only, but the Plaintiffs should not have to pay for accidental double billing, ie. $1,259.95 and $1,296.00 for December 13, 2000 and August 7, 2001 respectively. Similarly, to the extent that duplication is present in the charges of $246.00 and $192.00 in August 2001 (transcript for the discovery of Norbert Beaujot), those claims should be reduced. The trial judge would have required the trial transcript for the 4th Trial Portion in 2003 to write his judgment, but the Simplot Defendant's claim of $3,922.00 for it should be disallowed as above for the Seed Hawk Defendants.
[222] The Plaintiffs advanced two main concerns for the Simplot Defendant's witnesses: reasonableness of their attendance during trial portions in which they did not testify and the legitimacy of any costs at all, particularly relative to Mr. Smith and Mr. Malinowski. The Simplot Defendant's criticism of the Plaintiffs concerning estimates of pace of the trial is irrelevant at this point because those matters were underlying considerations canvassed before the trial judge rendered the Costs Decision. The reality is that it was difficult for everyone to estimate the pace of the trial as it unfolded, given factors such as the various motions leading to the reopening of direct and cross-examinations and objections to the admissibility of portions of experts' reports. Notwithstanding the delays, the Plaintiffs did finish their case on June 20, 2002, after which conduct and timing were within the control of the defendants. The Seed Hawk Defendants, apart from Mr. Huhtapalo's testimony out of order, did not begin their case until late on June 20, 2002. The Simplot Defendant had maintained throughout that it would require three days to put in its case. As it still took three days to do so despite not calling Mr. Malinowski as a witness, the conduct of the other parties could not have been a factor in the decision to ultimately not call certain individuals.
[223] The Plaintiffs relied on their submissions for Norbert and Pat Beaujot above to argue that, given evidence of Mr. Smith's attendance throughout the trial as the client's representative and given that he did not testify until February 6 and 7, 2003, there should be substantial discounting and disallowances of his travel costs associated with the four trial portions ($808.19, $4,403.21, $2,426.22 and $1,326.13 respectively). If something is approved for his role as fact witness, the hotel rate should be substantially discounted consistent with the submissions above for the Seed Hawk Defendants. Nothing should be allowed for the first two trial portions as there could not have been any reasonable expectation that the trial pace would allow time to get him on. Therefore, he could only have been in attendance as the client's representative. Similar reasoning applies to the first week (June 17 to 21) of the 3rd Trial Portion in 2002, and even the second week thereof. Therefore, much of the costs for this trial portion should be discounted. The allowance for the 4th Trial Portion in 2003 should be limited to his two days of testimony (which began late on February 6, 2003) and perhaps one or two days in advance given the inexactitude of estimates of trial pace. The claim of $1,037.62 for his travel expenses for November 24 to 27, 1997 (discoveries in Regina) includes charges of $140.00 per night for his hotel, which is unreasonable for the reasons above. However, apart from that, his own discovery occurred several months later at a different locale and therefore he could only have been present at the discoveries of Mr. Halford and Norbert Beaujot in November 1997 solely as the client representative for the Simplot Defendant, for which costs are not allowable. The Costs Decision does not permit any such recovery.
[224] Relative to Mr. Malinowski, the Plaintiffs referred to the circumstances above for Dr. Heinonen, a potential witness who travelled to the trial venue, but who was not ultimately called, and argued with particular regard to Thakore, supra that the Simplot Defendant is not entitled to claim any costs for this individual. Alternatively, if I was inclined to allow costs for a witness scheduled, but not ultimately called, nothing should be allowed here in any event because it was unlikely that there would have been enough time to get him on the stand in the 3rd Trial Portion in 2002.
[225] The Plaintiffs argued that Mr. Mudry, unfair as it might seem, was a fact witness limited, as was Mr. Huhtapalo, to the $20.00 per day plus reasonable travel expenses afforded by Tariff A3(1), or the allowance in the applicable superior court tariff, if higher. It is not clear from the evidence, which in his first invoice describes his claim as one for "expenses to cover my wages", whether he fits the circumstances of lost earnings considered in Maligne Bldg. Ltd., supra. If he indeed is asserting this as lost earnings, it is inconsistent for him to charge for travel time ($250.00 for one-half day on a Saturday) and for a Sunday ($500.00 on June 23, 2002). The cryptic entries in this invoice ($3,754.12 + taxes) do not establish that $500.00 is the actual loss, if any, suffered. These submissions are in addition to the point that nothing should be allowed because there was no possibility of his getting called to the stand in this trial portion. If something is allowed, it should exclude consideration for lost earnings and be limited to the travel expense for the latter days of this trial portion.
[226] The Plaintiffs advanced similar submissions for Mr. Mudry's invoice ($2,600.95 + taxes) for the 4th Trial Portion in 2003. Again, he claims $250.00 travel time for each of February 1 and 8, 2003 (both Saturday). He claims $250.00 for a half-day meeting with counsel on a Sunday (February 2) plus $500.00 for each day of testimony as a fact witness. He does not describe this as lost earnings, but rather Perdium [sic]. This reads almost as if an account for services rendered. This is simply not allowable in the Federal Court tariff or any other superior court tariff and should be disallowed consistent with Mr. Huhtapalo and Dr. Heinonen above.
Assessment
[227] The parties led submissions concerning costs associated with attendance at the hearing in Regina in June 2001 leading to the Costs Thrown Away Decision. I have already ruled above on such costs, which I disallow here for the Simplot Defendant ($289.92 and $107.00 + taxes). Relative to the $4,117.23 (November 27, 1993 to May 22, 2003), I think that the comments of Dean G. Giles, counsel for the Plaintiffs, echo the pragmatic and sensible observations in Almecon Industries Ltd., supra, ie. the reality of a myriad of essential disbursements for which the costs of proof might or would exceed their amount. However, that is not to suggest that litigants can get by without any evidence by simply relying on the discretion and experience of the assessment officer. As noted above, the less proof that is led, the more that the assessing party is bound up in my discretion. This series of charges might include costs associated with other interlocutory events not giving rise to entitlements to costs, apart from considerations of reasonable necessity. My general impression of the conduct by counsel for the Simplot Defendant was of a low key and streamlined approach, but I still will adjust certain of the amounts claimed. I allow as presented (all amounts taxes included) $95.56 (long distance), $50.79 (long distance facsimiles), $182.79 (couriers), $70.12 (postage), $8.03 (couriers) and $5.35 (facsimiles). I allow $2,425.00 taxes incl. (reduced from $2,755.52) for photocopies. I allow $235.00 taxes incl. (reduced from $292.11) for facsimiles. I allow $435.00 taxes incl. (reduced from $591.59) for Quicklaw. I disallow $26.75 (electronic case management fee), $37.45 (opening fee for folders etc.) and $1.17 (PST), the latter being unexplained and for I cannot account.
[228] Beginning at page 9 of the bill of costs (October 14, 1997: paid $237.27 taxes incl. to Fillmore Riley for copies of documents) over to page 15 (April 2005: $625.00 to Receiver General for mandatory Tariff A2 trial fees), and apart from items of costs addressed specifically in the oral submissions before me, I have assessed a number of items by either allowing them (all dollar amounts taxes incl. as applicable) or by disallowing them. In considering these items, I reviewed a series of 51 billings to the client by Mr. Riedel for the period November 27, 1993 to November 30, 2004, as well as certain additional materials in the record. Items allowed as presented are: $237.27 (copies/Fillmore Riley); $23.75 (instant printing/Henry Armstrong); $6.72 (postage); $18.28 (four binders); $978.78 (Royal Reporting Services Ltd.); $76.23 (_ of boardroom rental/Fillmore Riley); $1,072.14 (transcripts (Verbatim Reporters); $714.92 (discovery travel expenses for Mr. Riedel); $36.25 (copies/Fillmore Riley); $768.26 (transcripts/Law Reporting); $209.67 and $13.72 (instant printing/Henry Armstrong); $4.11 (12 coils); $10.95 (postage); $65.70 (courier April 1, 1999/I note the hearing and order on April 6, 1999, in Winnipeg, dismissing with costs in the cause the Simplot Defendant's motion for summary judgment); $33.19 (copies/Armstrong Perkins Hudson, Mr. Blair's firm); $264.61 (transcript/Dicta); $100.00 (filing fee/Fillmore Riley); $504.91 (copies/Fillmore Riley); $0.08, $1.31, $11.78, $180.08, $5.62, $0.36, $230.75 and $5.72 (colour copies/Gord's Quick Print); $31.00 (copies of jurisprudence); $47.08 (transcript/Law Reporting); $135.00, $101.91, $901.55 and $162.00 (Mr. Riedel's mileage and living expenses for the 1st Trial Portion in 2000); $9.02 (long distance facsimiles); $9.72 and $0.64 (index tabs and covers); $4,195.57 (Mr. Riedel's mileage and living expenses, including telephone and parking, for the 2nd Trial Portion in 2001); $3,621.68 (transcripts/Law Reporting); $617.50 (trial fees/Receiver General for Canada); $2,418.96, $152.20, $144.38, $750.00 and $153.00 (Mr. Riedel's mileage and living expenses, including long distance and parking, during the 3rd Trial Portion in 2002/I note that the long distance tolls would address, among other things, matters of scheduling); $7.12 and $108.83 (copies/Henry Armstrong); $4,126.99 (transcripts/Law Reporting); $593.75 (trial fees/Receiver General for Canada); $37.29 (courier); $173.00, $2,905.62, $98.33, $94.83, $10.60, $231.33 and $713.33 (Mr. Riedel's mileage and living expenses for the 4th Trial Portion in 2003 plus printing supplies, photocopies and binding); $44.40 (copies/Federal Court registry) and $625.00 (trial fees/Receiver General for Canada). As applicable, these allowances reflect my acceptance of the Simplot Defendant's position concerning the appropriate hotel rate.
[229] I disallow $3.44 (Corporations Branch Search/for similar reasons above); $11.96 (storage boxes); $16.69 and $15.92 (post-it flags and binders) and $21.35 (five boxes/timing was just before the 4th Trial Portion in 2003, but they could have been reusable). There is a claim of $625.00 for trial fees in April 2005, some two years after the trial fees ($625.00) were paid for the 4th Trial Portion in 2003. I cannot locate anything in the record which would account for this same amount being billed again: I disallow it as there were other inadvertent instances of duplication in the bill of costs.
[230] There is nothing in the tariff language for item 9 prohibiting a claim for the attendance of second counsel, such as by Mr. Swayze for the November 1997 discoveries. However, the tariff was conceived to capture partial indemnity. I do not think that its listing of services is intended to be exhaustive because fee items, such as item 14, provide for first and second counsel, but fee items, such as item 9, do not. I do not think that item 27 can be used so broadly as to fill in, so to speak, second counsel on discoveries given that the drafters of the tariff did not see fit to give item 9 the additional feature of second counsel found in item 14. As I have noted for item 24 (fees for counsel's travel time), disbursements fall under different parameters and I do not hesitate to allow the associated travel disbursements. I am not convinced here that I should allow Mr. Swayze's travel costs. Mr. Riedel's suggested calculation was useful: I allow $1,000.00.
[231] There are a myriad of taxes and surcharges added to the base fare for airline tickets. Marketing and regional factors or variances affect pricing formulas. The charges of $32.00, $7.00 and $74.77, further to the $1,102.00 for the airline ticket, strike me as surcharges associated with travel agencies or change fees. The law firm's practice of separating items subject to and not subject to GST accounts in part for the multiplicity of charges. I allow Mr. Riedel's travel costs ($1,611.54) as presented for the March 1999 discoveries. In the past, trips have been used for work for multiple, but unrelated, clients and I have apportioned the associated costs accordingly. I allow Mr. Riedel's travel costs ($1,028.20 taxes incl.) as presented for the September 1999 discovery.
[232] The matter of the $1,259.95 and $1,296.00 for transcript is troublesome. The bill of costs has a claim of $44.00 + GST for transcript from the firm of Law Reporting, which shows up in the November 30, 2000 billing to the client. This could be an excerpt from the transcript for some urgent purpose, ie. to react to Mr. Blair's situation. I allowed it above. The next billing to the client, dated March 30, 2001, shows the disbursement of $1,259.95 (before taxes) for "transcript" from Law Reporting, presumably for the 1st Trial Portion in 2000. The billing to the client dated August 13, 2001, shows three disbursements for transcript: $1,296.00 for "Transcripts of trial" from Law Reporting (the reporting firm used for the trial) plus $246.00 and $192.00 for "Transcripts" from Four Seasons Reporting Service (which I assume is the reporting firm used for the discovery of Norbert Beaujot). There could be several explanations. For example, only a portion of transcript for the 1st Trial Portion in 2000 was ordered and the $1,296.00 in August 2001 simply reflects payment for the balance of the transcript. The problem is that the total of these two amounts ($2,555.95) purportedly for slightly over three days of hearing, does not fit with the amounts charged respectively for the latter three trial portions, ie. $3,384.75 for 12 days, $3,857.00 for 10 days and $3,922.00 for 10 days (keeping in mind variances as a function of level of activity from day to day). As well, the Seed Hawk Defendants' evidence included the actual invoice from Law Reporting for the transcript for the 1st Trial Portion in 2000, ie. $1,335.05 before taxes. Another explanation might be inadvertent double billing. The problem with that is precisely the point made by the Simplot Defendant: these were discrete billings for different amounts. I allow all of the charges referred to above as presented, except for the $1,296.00 which I find too remote for any relevant event. As well, for the reasons above for the Seed Hawk Defendants, I disallow the $4,196.54 taxes incl. claimed for transcript for the 4th Trial Portion in 2003.
[233] Mr. Riedel reacted with a sure hand to the potential harm to his client's case posed by Mr. Blair's difficulties with the case presentation for the Seed Hawk Defendants. I do not attribute extraordinary powers of clairvoyance to Mr. Riedel, but he strikes me a shrewd observer. If Mr. Smith had not, in fact, attended at trial in the first instance as the client's representative on site for ongoing instructions to counsel, I have no doubt at all that Mr. Riedel would not have scheduled Mr. Smith's attendance before November 9, 2000, the day after Mr. Blair's collapse. Although I would not characterize the events in the 2nd Trial Portion in 2001 as extraordinary, I do think that, and again assuming that Mr. Smith would not have been in attendance but for his role as client representative on site, Mr. Riedel would have, early in that trial portion, been alarmed at the rapidly diminishing prospects of getting to his case. Mr. Riedel demonstrated his powers of observation before me by noting that he would not be surprised if I disallowed costs associated with Mr. Smith's attendance during the first two trial portions. He did however argue that the considerations were very different for the latter two trial portions in terms of what was a reasonable estimated date of arrival for his witnesses. Mr. Riedel's intuition was correct. I find that the circumstances were too remote for a reasonable expectation that Mr. Smith would get to the stand in the first two trial portions and I therefore disallow his costs ($808.19 and $4,403.21 respectively). I do allow his travel costs of $1,037.62 in November 1997 as I accept Mr. Riedel's suggested view of the circumstances in this difficult litigation.
[234] The evidence from the Simplot Defendant was that, for the 3rd Trial Portion in 2002, it was anticipated that its witnesses would get on in the latter part of the last week of trial, ie. the second week. Although the trial pace was again not encouraging, the possibility still existed that the Simplot Defendant would get to its case and therefore its witnesses were brought to Winnipeg. These included Ross Harvey from AdFarm in Calgary, an expert who ultimately testified in the 4th Trial Portion in 2003, and Mr. Malinowski, who ultimately did not testify. I accept the Simplot Defendant's position concerning witnesses brought to the trial venue in June 2002, including Mr. Malinowski. The evidence clearly establishes that Mr. Smith attended from June 16 (Sunday) through June 25, 2002. The evidence is somewhat unclear or absent for the attendance dates of other witnesses. Assuming that counsel in this sort of trial might find himself doing last minute witness preparation on a weekend (that appeared to occur with Mr. Mudry), I find that June 22 (Saturday) was a reasonable arrival date for these various witnesses. I think June 27 (Thursday) should have been the latest hotel check-out date for all of them. I allow $1,300.00 taxes incl. for Mr. Smith's travel costs (reduced from $2,426.22 claimed). The bill of costs shows the $5,121.19 claimed for Mr. Harvey as addressing his travel expenses, but the underlying AdFarm receipt indicates that $1,386.10 + GST of that address travel expenses with the balance addressing his professional fees. I allow the $5,121.19 as presented. I allow Mr. Malinowski's account as presented at $3,460.87.
[235] Relative to Mr. Mudry's account for the 3rd Trial Portion in 2002, I note that Rule 41(4)(b) provides for a subpoena, with leave of the Court, to compel the attendance of a witness residing more than 800 kilometres from the trial venue. This requires notice and a formal application plus attendant costs. Mr. Mudry apparently was willing to come. He forwarded his expense claim under cover of a message dated July 2, 2002 to Mr. Smith on Waterloo - Oxford Co-operative Inc. letterhead noting, among other things, that "agreement was made by Wolf to cover my full wages at $500.00 per day". The expense claim itself, for $3,754.12, includes $1,254.12 for travel expenses, which I approve. The balance consists of $2,500.00 for his wages, broken down as follows: $250.00 for ½ day travel time (Saturday, June 22) + $500.00 per day (Sunday, June 23 to Wednesday, June 26 inclusive) + $250.00 for ½ day (Thursday, June 27). Mr. Reidel indicated before me that Mr. Mudry was not a salaried employee. If he was an employee, he likely would be senior enough to preclude coverage by an employee's collective agreement for time off for court testimony or overtime.
[236] As this claim was essentially presented as lost earnings, and setting aside weekend days as a factor for the moment, $500.00 could be a net amount if he was an employee, meaning that, and assuming 200 to 240 working days per year, his net earnings per year would be $100,000.00 to $120,000.00 approximately, and his gross earnings might be in the order of $120,000.00 to $145,000.00. However, it makes more sense to consider that his relationship was contractual and that he was not paid if he did not work. None of that, if so, was in the evidence. I accept Mr. Riedel's assurances that Mr. Mudry was in a position of loss. Senior executives are often required to work weekends, often or usually without any additional compensation, other than perhaps by yearly bonus. There was no indication that Mr. Mudry, if indeed a contractee, was working 365 days a year (indeed, the evidence was that he had "retired" from the Simplot Defendant, although that term might inadvertently have been used instead of "resigned") and would have lost earnings for the two weekend days. A recurring theme before me were objections to counsel giving evidence. In an effort to keep things moving, I suggested that, for instances of scanty proof, counsel invite me to make certain inferences. One possible inference is that Mr. Mudry did not work 365 days a year because the evidence is that he stayed in the Winnipeg area until July 1, perhaps to renew old acquaintances. He claimed ground transportation only for his arrival day, but not for his departure day, meaning that an acquaintance could have dropped him at the Winnipeg airport on July 1.
[237] Another concern with his expense sheet is that he does not claim for GST. A salaried employee could not so claim. However, the law mandates GST charges for many contractual relationships. His expense sheet does not mention GST. The bill of costs, however, claims for GST on the $2,500.00 for his time. Mr. Riedel's firm uses an accounting system that carefully distinguishes between GST and non-GST items. There is nothing in the client billing statements including this claim as a disbursement. My guess or inference, given that Mr. Mudry was writing directly to Mr. Smith and put Mr. Smith's telephone and facsimile numbers on the covering message, is that Mr. Smith simply paid the $3,754.12 directly and then forwarded the details to Mr. Riedel's office for eventual inclusion in the bill of costs. An accounting specialist for the Simplot Defendant, in reporting to Mr. Riedel on details of Mr. Malinowski's account, indicates that Mr. Smith had sent invoice copies for Mr. Mudry separately (to Mr. Riedel). There were receipts additional to those in the record before me, ie. Mr. Mudry's reference to an attached hotel statement, which could have detailed GST. I will allow the GST subject to the following adjustment. I am not convinced that Mr. Mudry would have suffered a loss for Saturday and Sunday. Although I think that he used the trip for other personal purposes, he likely would not have made the trip, but for this litigation. I do not think that the Plaintiffs are responsible for compensating for his time on Saturday (travel) or Sunday (likely, he met with counsel). He was simply a fact witness. However, they must compensate for the ½ day on June 27. I deduct $750.00 from his account, reduce the GST accordingly and allow his claim at $3,214.41.
[238] For the 4th Trial Portion in 2003, Mr. Smith checked into the hotel on Saturday, February 2 and checked out on Friday, February 8. He was called to the stand late on Thursday, February 6 and testified through February 7. Mr. Mudry was the first Simplot Defendant witness in this trial portion, but counsel may have been waiting until the last moment to determine the order of witnesses. The claim of $1,326.13 for Mr. Smith is modest. I allow it as presented.
[239] For this final trial portion, the claim for Mr. Harvey was $2,812.21 ($2,628.23 + $183.98 GST), consisting of $421.65 + GST for travel expenses and $2,200.00 + GST for his expert fees. I find these amounts reasonable and allow them as presented.
[240] Finally, the claim for Mr. Mudry is $2,600.95 + $182.07 GST, and it raises some intriguing questions. As above, I accept the premise that Mr. Riedel could only estimate a deadline for arrival of witnesses. Mr. Mudry's bill for the 3rd Trial Portion in 2002 represented the maximum dollars he could hope to squeeze out of his appearance. In the final trial portion, his trip expense sheet does not break out meals, so the $296.85 GST incl. and the $611.04 GST incl. for airfare and hotel room (4 nights) respectively seem reasonable given that I assume the latter includes meals and incidentals (no mention of taxis). Apart from Mr. Riedel's assurance that he again was in a position of loss, Mr. Mudry's use of the term per diem, although misspelled, more clearly conveys the sense of someone limited to compensation by way of a daily fee for his expertise or expenses. In other words, unlike salaried employees who might still be paid when absent, ie. sick, vacation, bereavement, court and other types of leave negotiated as part of collective agreements, he is not paid if he is not available to work. He arrived on Saturday, February 1 and returned home on Saturday, February 8 (by mistake I assume, he claims for dates in March by using "03" instead of "02"). For each of those days, he claimed $250.00 for his travel time (½-day). He claims $250.00 (½ day) to meet with counsel on Sunday, February 2. He claims $500.00 for his time on February 4 and 5. He testified on February 5. He claims for a hotel room for the evenings of Monday, February 3 to Thursday, February 6.
[241] There is no explanation from Mr. Mudry for these inconsistencies, but I think it simply flows from his seizing the opportunity to use the trip for other personal reasons. I allow the travel expense portion as claimed at $907.89 GST incl. That portion, added to his claim for lost earnings, totals the $2,657.89 claimed in his statement (which refers to attached receipts not in evidence before me). His statement does not show any GST on the $1,750.00 (lost earnings) which forms part of this $2,657.89, which I deduce from the handwritten financial coding entry on said statement. That is, the accounting clerk subtracted the $56.94 GST on his airfare and hotel from his total claim of $2,657.89 to arrive at the coded amount, exclusive of GST, of $2,600.95 required by financial coding software. This amount of $2,600.95 then became the principal amount claimed in the bill of costs, to which was added $182.07 GST (presumably including the $56.94 GST above). Again, the client billing statements do not reflect this account, so I assume that the client paid this account directly, including the GST over and above the $56.94 paid by Mr. Mudry in the first instance. A per diem allowance can refer to wages, but its usual sense is a fixed payment per day for only those days affected, ie. meals and incidentals for each day that a person is on travel status or expenses for each sitting day as an ad hoc member of a tribunal or committee of some sort. I have looked at Mr. Mudry's statements. I simply do not accept that he is in demand 365 days a year. I allow only $1,000.00 for his lost earnings and adjust the GST allowance accordingly, meaning the total allowance for this final trial portion is $1,977.89.
The Seed Hawk Defendants' bill of costs (for the May 7, 2004 hearing in Winnipeg resulting in the Costs Decision) totalling $11,070.80, consisting of $7,500.00 (lump sum fees awarded by the trial judge); $525.00 (GST on fees); $2,987.40 (disbursements) and $58.40 (GST on some disbursements)
The Simplot Defendant's bill of costs (for the May 7, 2004 hearing in Winnipeg resulting in the Costs Decision) totalling $9,462.71 (after certain adjustments by counsel and correction of arithmetic error), consisting of $7,500.00 (lump sum fees awarded by the trial judge); $525.00 (GST on fees); $1,369.11 (disbursements); $66.74 (GST on some disbursements) and $1.86 (PST on some disbursements)
The Parties' Respective Positions
[242] The Seed Hawk Defendants noted that the evidence before the trial judge was essentially what was before me, less materials specific to a formal assessment of costs. The page count on the record and service and filing requirements, as well as a copy for the client, account for the approximately 11,000 photocopies ($1,707.00 claimed). The record discloses jurisprudence, located further to Quicklaw searches ($336.87 claimed), provided to the Court and the use to which it was put. The Equifax online search ($103.15 claimed) was a reasonable expense given that it would be irresponsible for counsel to urge the client to spend further monies on directions for costs if the Plaintiffs were impecunious and could not satisfy costs in any event.
[243] For index tabs and binding supplies (claimed at $49.71), the Simplot Defendant argued that a law firm's overhead consists of routine and ongoing operating expenses such as secretarial services, heating, office machines, photocopiers etc., but things such as photocopies, tabs and bindings are consumables solely attributable to a specific client, and for which costs are allowable. Counsel for the Simplot Defendant would facsimile (claimed at $251.00) only the key portions, but not a complete document, ie. motion record, to the parties and then courier the complete document to the parties and the Court, so as to expedite access. The long distance figure (claimed at $66.49) represents the associated long distance tolls for the facsimiles. The mileage in the travel expenses (claimed at a revised $415.75) is at the government rate. The hotel component is consistent with charges above. The meal component is somewhat higher because of arrival the day before the motion plus three meals on the day of the motion before driving back to Brandon.
[244] The Plaintiffs argued that the difference between the Seed Hawk Defendants' photocopy claim ($1,707.00) and that of the Simplot Defendant's claim ($448.50) which is reasonable, is a discrepancy not justified by their respective materials led at the motion. The Seed Hawk Defendants' amount is excessive and should be reduced to something in the order of $1,000.00. Per the submissions above, the hotel rates of $132.12 and approximately $160.00 (counsel for the Seed Hawk Defendants and the Simplot Defendant respectively) are excessive and should be reduced. As well, Mr. Riedel's meal claim (about $99.00) seems high given that the hearing concluded early enough to permit him to drive back to Brandon.
[245] The Plaintiffs conceded that there could have been some necessary research, but the Seed Hawk Defendants' claim of $336.87 (Quicklaw) should be discounted somewhat given that this single hearing involved a relatively limited number of issues. The online search charge of $103.15 should be disallowed because, as it likely was a credit check on the Plaintiffs' financial situation, it was irrelevant to the hearing issues.
[246] The Plaintiffs noted that, for the most part, they did not object to things such as tabs and bindings ($49.71) for the trial because Mr. Riedel had to function in an extended mode remote from his home base. That was not the situation here for a single day: disallow this claim as overhead. The $66.49 for long distance should be reduced somewhat because a motion for directions on costs did not require such expedited notice. The Rules limited the circumstances for service by facsimile. The charges of $115.16 (couriers) and facsimiles ($251.00) taken together are excessive: allow one or the other or simply adjust their total downwards.
Assessment
[247] I understand the rationale for client copies, but my view has and continues to be that the associated cost, over and above a copy for supervising counsel, represents an excessive charge beyond the obligations of indemnification imposed on a losing litigant. However, I think that the cost of copies of documents for local Registry office files are essential and part of indemnifiable costs. I allow $1,600.00 for the Seed Hawk Defendants' photocopies. I have nothing further to add to my comments above on hotels: I allow them as presented for both counsel. The hearing concluded at about 4:30 pm. As a former manager with financial signing authority for travel claims, I know that the varying dietary cycles of people sometimes make it difficult to peg specific time slots for meals. I accept Mr. Riedel's submissions and approve his travel claim as presented.
[248] One of the problematic factors for Quicklaw is determining whether all, none or only part of the research was reasonably necessary: I allow a reduced amount of $260.00 to the Seed Hawk Defendants. As for the $103.15 (online credit search), my comments in Bill of Costs and Assessment, defining core concepts of costs, essentially hold that an underlying principle of costs is that they are subject to indemnification if they were reasonably necessary to achieving success in the litigation. I do not think, regardless of comments above that no one asks to be sued and that such searches were prudent, that I can stretch this principle to find that this expense was integral to success in the issues underlying the Costs Decision: I disallow it. I allow $49.71 (tabs and bindings) and $115.16 (couriers) to the Simplot Defendant. I can only speculate on what were the "key portions" of documents, particularly as a function of the perspective of opposing counsel. I allow reduced amounts of $30.00 and $165.00 to the Simplot Defendant for long distance and facsimiles respectively.
[249] The other items in both bills, not specifically in issue, are allowed as presented. For some items in both bills of costs, I did not have the underlying invoices in front of me by which I could determine GST as a factor (it is broken out as a separate claim in each bill). I have simply reduced the GST claims of $58.40 (Seed Hawk Defendants) and $66.74 (Simplot Defendant) to $50.00 and $60.00 respectively. Each bill of costs included $7,500.00 lump sum fees presumably for me to certify the GST claim of $525.00 for each, which I have done.
The Plaintiffs' Bill of Costs totalling $84,978.46 GST excluded for counsel fees (pleadings, motions, discovery of documents and preparation for and attendance on discoveries, case conferences and the 2nd Trial Portion in 2001) and for disbursements (facsimiles, postage, long distance, couriers, photocopies and reproductions, travel by counsel, transcripts, Quicklaw, agent and court fees, expert witnesses and witness travel costs for discovery and trial)
[250] There are four areas of costs in issue relative to the Plaintiffs' bill of costs: (i) costs as a function of the order dated October 31, 2000, permitting further discovery; (ii) "reasonable costs thrown away" as a function of the Costs Thrown Away Decision; (iii) costs of the motion, within the 2nd Trial Portion in 2001, to reopen the cross-examination of James Halford, and (iv) costs as a function of the Reconsideration Decision addressing the Seed Hawk Defendants' motion to reconsider the judgment. As elsewhere, I have read and considered the details of the evidence and the written and oral submissions, but simply summarize them briefly in these reasons as the record, which includes a transcript of the hearing before me, reflects the full spectrum of the parties' respective positions on these eight assessments of costs.
(i) Costs as a function of the order dated October 31, 2000, permitting further discovery
[251] On October 31, 2000, one week prior to the start of trial, the Court ordered that:
... 1. The defendants are hereby granted leave to file the Amended Statement of Defence proposed in their respective counsels' affidavits as follows:
a. the defendants Seed Hawk Inc., Pat Beaujot, Norbert Beaujot and Brian Kent, subject to the changes required pursuant to paragraph 2 of this order, no later than Monday, October 30th, 2000; and
b. the defendant Simplot Canada Limited no later than Tuesday, October 31st, 2000;
2. The defendants Seed Hawk Inc., Pat Beaujot, Norbert Beaujot and Brian Kent are to remove from Schedule A of their Draft Amended Statement of Defence the proposed amendment respecting "Public Uses" but are given leave to insert the substance of the allegations contained in paragraph 28 - 36 and 43 - 51 of the Affidavit of F. Benjamin Dyck sworn on March 2nd, 2000 into the body of their Amended Statement of Defence;
3. The plaintiffs shall have the right to examine the defendants for discovery on any new issues raised by the amendments provided that the examinations take place no later than November 3rd, 2000;
4. The plaintiffs are allowed their costs of such further examinations for discovery as against the defendants in any event of the cause; and
5. The plaintiffs are granted leave to enter at trial new expert evidence arising out of new evidence or issues disclosed at the examinations for discovery allowed herein without the necessity of filing experts' affidavits provided that a summary of the experts' evidence in writing by way of a letter from counsel is served on the defendants before the commencement of the trial.
The further discovery of Norbert Beaujot then occurred on November 3, 2000. The Plaintiffs claim Column IV fees of 5 units (available range 4 - 8) and 2 units per hour (available range 0 - 4) under items 8 and 9 for preparation and attendance respectively.
The Plaintiffs' Position
[252] The Plaintiffs generally argued, consistent with their submissions above, that it was appropriate to distinguish between the lowest and next lowest value in the available ranges, given the provision in the Costs Decision for assessment at the low end of Column IV. Therefore, depending on the complexity, nature and number of issues, many items were claimed at the lower, but not the lowest, end of a range. As above, the assessment officer has the jurisdiction to make such allowances.
The Seed Hawk Defendants' and the Simplot Defendant's Respective Positions
[253] The Seed Hawk Defendants argued, consistent with their submissions above and echoed by the Simplot Defendants below, that items 8 and 9 should be allowed at 4 units and 1 unit per hour respectively, being the lowest value in the relevant ranges. The Simplot Defendant should share equally in the burden of these costs because, although it did not participate in the examination itself, it did join in the Seed Hawk Defendants' motion to amend its defence by incorporating the Seed Hawk Defendants' amendments. The examination for discovery flowed directly from that relief. The Simplot Defendant's liability for inducement of patent infringement was a function of the Seed Hawk Defendants' liability for infringement and therefore the former benefited from this work. In any event, the order provided for costs "as against the defendants", without distinguishing between them, and therefore the Simplot Defendant as a co-defendant must bear an equal share of any assessed costs.
[254] The Simplot Defendant addressed apportionment of costs by noting generally that the Plaintiffs have one set of costs against two sets of defendants. If I decide that the Plaintiffs do not have a right of costs as against the Simplot Defendant for a particular item, then apportionment is not applicable and by default the Seed Hawk Defendants must bear the full burden of those particular costs. Although the October 31, 2000 order addressed all of the Defendants, the Plaintiffs restricted themselves to discovery of the Seed Hawk Defendants' representative. The actual order in the Costs Decision (at page 34) awarded to the Plaintiffs "the costs of proceedings in respect of which they were awarded their costs in any event of the cause in accordance with the following directions: a) there shall be only one order for costs in respect of all the plaintiffs...." Effectively, that means one set of costs against all of the Defendants. This is not a situation of costs having been awarded in a vacuum, leaving the Plaintiffs the challenge of joint and several collection against several parties. Once I have assessed the Plaintiffs' costs and further to Milliken, supra (A.O.), I have the jurisdiction to apportion the said assessed costs as between the co-defendants, and before any set-off. The Plaintiffs chose not to discover Mr. Smith and therefore the Simplot Defendant is not responsible for these particular costs.
Assessment
[255] The October 31, 2000 order did not, as sometimes happens: see for example para. [3] of Milliken & Co. v. Interface Flooring Systems Inc., [1998] F.C.J. No. 541 (F.C.T.D.), vest the trial judge with residual jurisdiction for the costs of their discovery, ie. by language such as "the plaintiffs are allowed their costs of such further examinations for discovery as against the defendant in any event of the cause in accordance with any scale or limits that the trial judge deems appropriate." Clearly, in that scenario, the trial judge's direction in the Costs Decision, ie. assessment of "the costs of proceedings in respect of which they were awarded their costs in any event of the cause in accordance with the following directions: ... assessed at the low end of column IV...," would permit refinement of the costs award in the October 31, 2000 order. However, with the greatest of respect and consistent with my conclusions above for interlocutory decisions, I am not certain about the extent of said Column IV provision. That is, once the October 31, 2000 order was entered, without the otherwise language of Rule 407, it would seem that the default limits of Column III costs applied. If the Plaintiffs had been unhappy with that, their recourse would have been an interlocutory appeal, with s. 52(b)(i) of the Federal Courts Act giving the Federal Court of Appeal the jurisdiction to award the process that should have been given, ie. Column IV costs. Apart from that, an unintended consequence of the language "at the low end" is that, for things such as item 9, it catches the value 0 in the available range of 0 to 4. There is overlap between Columns III and IV. I allow the item 8 and 9 claims as presented at $550.00 and $704.00 respectively. There were not any identified disbursements associated with these counsel fee items. I note that, as I understand the submissions in general, the choice of Column III versus Column IV units for items 5 and 6 in the Defendants' bills of costs was not in issue (aside from the matter of watching briefs on the part of the Simplot Defendant). Therefore, I have not adjusted the allowances as a function of my comments throughout on the jurisdiction of trial judges to vary the awards of costs by motions judges.
[256] I am struck by the irony that the Simplot Defendant above urged me to not discount the demands on it of the need to be involved in a significant manner in the formulation of and carrying out of the Seed Hawk Defendants' defence, ie. the propping up of said defence, after insufficient cross-examination of Mr. Halford in the 1st Trial Portion in 2000 by Mr. Blair, by counsel for the Simplot Defendant asking additional questions that Mr. Blair should have asked. I think that Mr. Riedel is correct. I can apportion costs. I think that the Simplot Defendant must bear some of these costs as a function of my provision for set-off below, effectively subsuming the apportionment consideration.
(ii) "reasonable costs thrown away" as a function of the Costs Thrown Away Decision
[257] The Plaintiffs claim (all under Column IV) 6 units (available range 5 - 9 units) for item 1 (filing of the reply to the further amended statement of defence); 5 units and 2 units per hour (available ranges 4 - 9 and 1 - 4 respectively) for items 5 and 6 respectively (preparation for and attendance on the hearing resulting in the Costs Thrown Away Decision); 4 units (available range 3 - 9 units) for item 7 (discovery of further documents); 5 units and 2 units per hour (available ranges 4 - 8 and 0 - 4 respectively) for items 8 and 9 respectively (preparation for and attendance on the discovery of Norbert Beaujot on August 2, 2001); 3 units and 2 units per hour for items 8 and 9 respectively (preparation for and attendance on the discovery of James Halford on September 4, 2001); 2 units per hour (available range 1 - 4) for item 11 (attendance on August 3, 2001 for case conference convened before the trial judge); 4 units (available range 3 - 9) for item 13(a) (preparation for reopening in the 2nd Trial Portion in 2001 of Mr. Halford's direct examination); 2 units per hour (available range 2 - 4) for item 14(a) (attendance at trial by first counsel on the reopening of Mr. Halford's direct examination); item 14(b) (second counsel at 50% of the fees for item 14(a)); $8,880.00 (fees and disbursements for John Harapiak, an expert witness); $17,045.07 (fees and disbursements for Sylvio J. Tessier, an expert witness); $9,112.50 (fees and disbursements for David Schaaf, an expert witness); $20,845.03 (fees and disbursements for Ade & Company, a patent agent); $731.58 (travel costs for Mr. Halford's attendance for discovery on September 4, 2001) and several thousand dollars more for disbursements detailed below.
[258] The relevant portion of the Costs Thrown Away Decision reads:
... [4] The grounds on which the orders in question are sought are the following. New counsel appointed by Seed Hawk Inc. have determined that certain amendments to the Statement of Defence are necessary to more clearly and expressly plead and present Seed Hawk Inc.'s defences to the claim. In relation to the documents sought to be introduced, it is said that the documents have only recently come into the possession of the counsel for the Seed Hawk defendants, Mr. Horne, as a result of a trip to Scandinavia to interview two witnesses whose work has previously been cited as prior art. As for the further supplementary affidavit of Mr. Anderson, it is said that he was not properly instructed in the preparation of his earlier affidavit and that he is required to comment on the documents which the Seed Hawk defendants seek to put in. Overall, it is said that the failure to grant this relief will prejudice the Seed Hawk defendants in the defence of the claim.
[5] Counsel for Simplot supports Seed Hawk's motion. He says that no prejudice will be caused to his client's position. His own motion is brought simply for the purpose of incorporating the amended defence into his client's defence.
[6) Counsel for the plaintiffs, Mr. Raber, opposes the motions on various grounds. One is an argument about due diligence in the sense that the documents sought to be introduced could have been obtained and produced earlier by the exercise of some diligence by prior counsel for the Seed Hawk defendants. The amendments to the Statement of Defence may, in some cases, be more precise formulations of allegations contained in the Statement of Defence but they also contain new allegations which had not previously been raised. As for the Affidavit of Mr. Anderson, I am asked to draw an inference from the fact that there is no Affidavit from Mr. Anderson or former counsel setting out the nature of the alleged improper instruction.
[7] However, the real substance of the plaintiffs' argument is that it is unfair to introduce changes of this nature in the course of a trial which has already commenced. Counsel has made his opening statement and Mr. Halford, the inventor, has testified in chief and has been cross-examined. Counsel argues that, having crafted his case to meet one case, it is unfair to allow the Seed Hawk defendants to change the case by amending their defence and introducing new evidence in the form of additional documents and an expert's report. The effect is to change the cast of the case after Mr. Halford has already given his evidence. This is particularly acute in the case of certain allegations in the proposed Amended Statement of Defence which refer to dealings between Mr. Halford and Mr. Dyck which are said to contradict the evidence given at the trial by Mr. Halford. This is made all the more difficult to remedy by the fact that Mr. Halford and Mr. Raber are subject to an order of the Court which prohibits them from discussing Mr. Halford's evidence until his re-examination has been completed.
[8] Mr. Raber also points out that the introduction of new documents which have not been seen by his experts put them at risk of being compromised. Having expressed themselves on the basis of the information available to them, they may now be in the position of having to change their position on the basis of the documents sought to be introduced. This will subject them to cross-examination on their change in position. On the other hand, there is no shame in not commenting on a document which was not in issue at the time the expert affidavit was prepared. The experts for the defendants will be subject to the same criticism.
[9] Finally, Mr. Raber points to the unfairness of the defendants being able to backfill their position in mid-trial. The fact that this trial stands adjourned as a result of facts over which no one had any control ought not to give the defendants a tactical advantage. On the other hand, the loss of a tactical advantage, if there was one, is not grounds to deny an amendment which would otherwise be allowed.
[10] The legal principles applicable to the motion are not particularly complex. They were recently set out in the case of Visx v. Nidek Co. (1998), 234 N.R. 94 (F.C.A.). The Court had before it an appeal from a failure to allow an amendment of a Statement of Defence at an interlocutory stage. The Federal Court of Appeal quoted and applied the following passage from Steward v. North Metropolitan Tramways Co. (1886), 16 Q.B.D. 556:
The rule of conduct of the court in such a case is that, however negligent or careless may have been the first omission, and however late the proposed amendment, the amendment should be allowed, if it can be made without injustice to the other side. There is no injustice if the other side can be compensated by costs; but, if the amendment will put them into such a position that they may be injured, it ought not to be made.
[11] In Visx, supra, the Court of Appeal allowed the amendment even though the Statement of Defence had been amended five times previously. Mr. Raber seeks to distinguish Visx on the ground that it is a case about an interlocutory motion whereas this is a case about a trial which is in progress. Mr. Horne points to the four months remaining until the trial resumes and argues that this is effectively an interlocutory motion.
[12] The difference between this situation and an interlocutory motion is that the evidence of the principal fact witness has already been taken. A change in the pleadings which is said to contradict evidence already given causes a prejudice which cannot be made right by an order in costs. There may be other amendments which will require further evidence to be called.
[13] Nor is the question of prejudice a matter which can be set over to be dealt with after the amendments have been allowed and the additional documents and evidence put into the record. It was suggested that if the plaintiffs could show some prejudice once the various heads of relief sought had been granted, they could then apply by motion for the appropriate relief. This fails to recognize that prejudice is a bar to allowing the relief sought. If the relief sought cannot be granted without prejudice to the position of the other side, even with the imposition of conditions, then the relief sought ought not be granted.
[14] My reading of the proposed amendments satisfies me that they will permit the Court to decide the matters in issue between the parties. So the question becomes whether it is possible by the imposition of terms to remedy the prejudice to the plaintiffs caused by the amendments sought and the introduction of the various documents and the supplemental affidavit ( which will be collectively referred to as "the relief sought") at this stage in the proceedings? The introduction of the various documents does not impact directly on Mr. Halford's evidence to the extent that they deal largely with the content of the expert evidence as to prior art. The plaintiffs' expert evidence has yet to be heard. An affidavit as to the significance of the documents as prior art is a matter which could be dealt with by an appropriate affidavit in reply, if it were thought necessary to do so. Similarly, to the extent that the proposed affidavit deals with the operation of a particular device, this too can be remedied by an appropriate affidavit in reply. The additional expense incurred in taking these steps is a matter for costs.
[15] The problem arises when one considers to the amendments to the Statement of Defence. Before turning to the specifics of the amendments, it is worth recalling that a trial is a dynamic process. It begins with each party having a reasonably well defined view of the significance of the evidence they intend to lead. As each party's case develops, counsel assesses the quality of the evidence as it goes in and the damage if any done by cross-examination. If it appears that certain elements need to be reinforced, adjustments are made in the evidence of subsequent witnesses to plug any gaps that may have developed. There is an internal logic to this process as each party's perception of its tactical position causes it to make adjustments. At the end of it all, one often finds that matters which were thought to be relatively unimportant assume, or appear to assume, a significance which one would not have predicted.
[16] With that background, one can see why Mr. Raber would have serious misgivings about any amendment to the pleadings in the course of a trial. In addition to the tactical issues arising from the flow of the evidence, one now adds the possibility of some fact assuming unforeseen significance as a result of what appears to be an innocuous change in the pleadings. The view of the case which counsel tried to build through the evidence lead may no longer correspond to the language of the amended pleading. Evidence given with one perspective in mind may now open avenues of cross-examination or contradiction not contemplated when the examination-in-chief was planned.
[17] It is known that at least one paragraph of the Amended Statement of Defence raises a matter which was canvassed in Mr. Halford's evidence to date and which alleges a state of affairs possibly at odds with the evidence. That is the proposed paragraph 13(d) which alleges the following:
The named plaintiff Halford is not the inventor of the subject matter of the aforesaid claims. If there be any invention, the said subject matter was invented by F. Benjamin Dyck and directly disclosed to the plaintiff Halford by way of a sketch drawing prepared by F. Benjamin Dyck and forwarded by mail to Mr. Halford by Mr. Dyck in or about 1979 - 1980.
[18] It is not appropriate for me to comment on the evidence at trial, so I will limit myself to repeating what Mr. Raber says about this amendment.
Mr. Halford's involvement with Benjamin Dyck was canvassed at length when Mr. Halford gave evidence at the trial on November 6, 7, and 8, 2000. It was also reviewed in detail during examinations for discovery. Mr. Halford's evidence was to the effect that he was referred to Mr. Dyck by Mr. William Reed in 1983.
[19] How can the plaintiffs respond to this pleading at this stage of the trial? Given that it is a fundamental factual issue, it would take highly unusual circumstances to reach the position that the Court would refuse to consider evidence on this point because of a late amendment. This would introduce an artificiality into the proceedings which is totally at odds with the fact-finding nature of a trial. But the plaintiffs cannot be asked to simply leave the issue where it is, given its significance for their case. Some relief in the way of further evidence would have to be allowed.
[20] The same may be true for other changes introduced by the amendments. It is difficult for me to assess the significance of the various amendments without knowing the plaintiffs' case. It would be unfair to put the plaintiffs to the trouble of applying to lead new evidence on an issue by issue basis, both in terms of telegraphing their case and in terms of the cost and effort involved. It is therefore my view that if the amendments are to be allowed, examination-in-chief would have to be reopened on any issue arising out of the Amended Statement of Defence and cross examination allowed on those issues. Re-examination would then follow. It would also be necessary to release counsel and Mr. Halford from the order which prohibits discussion of Mr. Halford's evidence to date. Without knowing what issues might require further evidence, I cannot limit the topics of discussion without limiting the plaintiffs' ability to put their case before the court. It also follows that the plaintiffs would have the right to re-examine for discovery on any issue arising out of the amendments and if necessary, to file a reply to the Amended Statement of Defence.
[21] The plaintiffs should also have their costs thrown away resulting from any step undertaken as a result of the granting of the relief sought by the Seed Hawk defendants from those defendants only in any event of the cause.
ORDER
For the reasons set out above, it is hereby ordered that:
1- The Seed Hawk defendants shall have leave to:
a) serve and file the Amended Statement of Defence in the form tendered at the hearing of this Motion, provided the document is served and filed before June 29, 2001;
b) serve and file an Amended Affidavit as to documents incorporating the documents identified in their Notice of Motion materials as well as the documents tendered on the hearing of this motion, providing the Amended Affidavit of Documents is served and filed prior to June 29, 2001;
c) serve and file a supplementary affidavit of Clifford J. Anderson in substantially the same form as the affidavit tendered at the hearing of this motion providing such affidavit is served and filed before June 29, 2001.
2- Simplot Canada Limited has leave to file its Amended Statement of Defence in the form of the Amended Statement of Defence attached to the Notice of Motion materials providing such amended Statement of Defence is served and filed before June 22, 2001.
3- The plaintiffs have leave to:
a) conduct examinations for discovery of a representative of the Seed Hawk defendants on any issue arising out of the Amended Statement of Defence or the Amended Affidavit of Documents providing such examinations are concluded prior to August 15, 2001;
b) conduct examinations for discovery of a representative of Simplot Canada Limited on any matter arising out of the Amended Statement of Defence of Simplot Canada Limited providing such examinations are completed prior to August 15, 2001;
c) file a reply responding to any issue arising out of the Amended Statement of Defence, providing such reply is filed prior to June 29, 2001;
d) file a supplemental affidavit responding to the supplementary affidavit of Clifford J. Anderson, providing that such affidavit is filed in compliance with Rule 279(b) of the Federal Court Rules, 1998.
4- Counsel for the plaintiffs and Mr. Halford are released from the order made at the trial of this matter, prohibiting any discussion of the evidence given by Mr. Halford until his re-examination had been completed.
5- The plaintiffs shall recover their reasonable costs thrown away as a result of any steps taken pursuant to this order in any event of the cause, such costs to be spoken to at the conclusion of the trial of this matter.
ORDER
For the reasons set out above, it is hereby ordered that:
1- The Seed Hawk defendants shall have leave to:
a) serve and file the Amended Statement of Defence in the form tendered at the hearing of this Motion, provided the document is served and filed before June 29, 2001;
b) serve and file an Amended Affidavit as to documents incorporating the documents identified in their Notice of Motion materials as well as the documents tendered on the hearing of this motion...
The Plaintiffs' Position
[259] The Plaintiffs asserted, by way of the affidavit of James W. Halford sworn March 29, 2005 (hereafter the "Costs Thrown Away Halford Affidavit"), that:
... 7. In May of 2001, the Seed Hawk defendants brought a motion for an order granting them leave to file and serve a further amended statement of defence, an order granting leave to serve a further supplementary affidavit of documents disclosing allegedly newly-found or further documents, and an order granting them leave to serve and rely upon at trial a further supplementary affidavit from Clifford Anderson, one of the experts retained by the Seed Hawk defendants. This motion was heard on June 8, 2001 in Regina, Saskatchewan.
8. By order dated June 15, 2001 (amended June 21, 2001), a true copy of which is attached hereto as Exhibit "C", Mr. Justice Pelletier granted the relief sought but stated as follows on the issue of costs:
The plaintiff shall recover their reasonable costs thrown away as a result of any steps taken pursuant to this order in any event of the cause, such costs to be spoken to at the conclusion of the trial of this matter.
9. The legal fees and disbursements necessarily incurred by the plaintiffs as a direct result of the above order were substantial. I am advised by plaintiffs' counsel and believe that the issues raised by the new allegations set out in the defendants' further amended pleadings, the voluminous additional prior art documentation disclosed and the comments offered and opinions expressed by Mr. Anderson in his further affidavit required both plaintiffs' counsel and experts to undertake a significant amount of additional work that otherwise would not have been necessary, as affidavits of documents previously had been exchanged and examinations for discovery long since completed, all experts' affidavits served and the trial already had commenced.
10. Specifically, as a result of the relief granted in the June 15, 2001 order, the plaintiffs were required to take or were subjected to the following steps:
(a) further examination for discovery of Norbert Beaujot in respect of the further amended statement of defence and counterclaim, including discovery of all prior art referenced in the additional documents disclosed by the Seed Hawk defendants, which examination took place on August 2, 2001 in Winnipeg;
(b) preparation and delivery of a further supplementary affidavit of documents of the plaintiffs in response to new allegations contained in the further amended statement of defence and counterclaim. In particular, included among the amendments was an allegation that the subject matter of the claims in the patent had been disclosed to me by F. Benjamin Dyck, one of the experts retained by the Seed Hawk defendants. In order to respond to these allegations, I was required to search my records to locale additional documents and swear a further supplementary affidavit of documents. The production of these documents resulted in a further examination for discovery of me by counsel for the Seed Hawk defendants in Calgary on September 4, 2001. When the trial resumed on October 15, 2001, it was necessary for plaintiffs' counsel to re-open my examination in chief to address the issues concerning Mr. Dyck's alleged disclosure of the invention to me, which in turn led to further cross-examination of me by counsel for the Seed Hawk defendants;
(c) further review by the plaintiffs' experts of the allegations contained in the further amended statement of defence and counterclaim;
(d) further review by the plaintiffs' experts of the additional documents introduced by the Seed Hawk defendants which included, among other things, a substantial amount of publications, photographic material and other documentation relating to alleged prior art devices the defendants were relying upon to challenge the patent's validity;
(e) review by the plaintiffs' experts of the third (second supplemental) affidavit of Mr. Anderson, which the Seed Hawk defendants had been granted leave to serve and rely upon at trial;
(f) review by the plaintiffs' experts of the evidence given on the additional examination for discovery of Norbert Beaujot on August 2, 2001, and the numerous undertaking responses resulting therefrom;
(g) preparation of further responding affidavits by the plaintiffs' experts to address the various new allegations contained in the further amended statement of defence and counterclaim, the additional prior art documents introduced by the Seed Hawk defendants and the matters reviewed and commented on in the third (second supplemental) affidavit of Mr. Anderson;
(h) review by the plaintiffs' experts of a fourth (third supplemental) affidavit of Mr. Anderson also relating to alleged prior art, which was then withdrawn by the Seed Hawk defendants.
11. Prior to the commencement of trial, the plaintiffs had served affidavits from three experts: John Harapiak, Dr. Sylvio Tessier and David Schaaf. In a process mandated by the case management judge, Mr. Justice Campbell, Mr.Harapiak and Dr. Tessier both provided a first affidavit dealing solely with the issue of infringement as, at the time of their preparation, the Seed Hawk defendants had yet to advise of the prior art they were relying upon in support of their position that the patent was invalid. Subsequently, both Mr. Harapiak and Dr. Tessier provided a second affidavit commenting for the first time on the issue of validity and serving also as a reply to the evidence of the Seed Hawk defendants' experts on infringement. At the same time, the plaintiffs served the first affidavit of Mr. Schaaf which dealt with both infringement and validity. These affidavits constituted the whole of the plaintiffs' expert evidence at the time the trial commenced in November of 2000.
12. Based on discussions with the plaintiffs' counsel, it was agreed that it was necessary for each of the plaintiffs' experts to provide a further affidavit addressing the newly-disclosed prior art documentation and responding to the comments made and opinions expressed in the third (second supplemental) affidavit of Mr. Anderson, which had not been available at the time they prepared their earlier evidence. As a result, each of the three proceeded to conduct the necessary review of the further amended statement of defence and counterclaim and additional documentation provided by the Seed Hawk defendants, following which Mr. Harapiak and Dr. Tessier prepared a third and Mr. Schaaf a second affidavit.
13. Along with plaintiffs' counsel, Steven Raber, I personally attended the trial management conference on August 3, 2001. During the conference, in accordance with my standard practice throughout this proceeding, I took contemporaneous notes of the matters discussed. At one point, the issue of the affidavits to be prepared by the plaintiffs' experts in response to the matters arising out of the June 15, 2001 order was discussed. According to my notes, Mr. Justice Pelletier agreed with Mr. Raber's advice that the plaintiffs would be filing more than one affidavit. Attached hereto and marked as Exhibit "D" is a true copy of the notes I took at the trial management conference on August 3, 2001.
14. The additional services rendered by Mr. Harapiak as a result of the June 15, 2001 order are set out in his invoice of October 3, 2001, a true copy of which is attached hereto and marked as Exhibit "E". The total amount of the invoice was $8,880.00 and it was paid by the plaintiffs.
15. The services provided by Dr. Tessier arising out of the June 15, 2001 order are the subject of the following invoices, true copies of which are attached hereto and marked as Exhibit "F" and all of which have been paid by the plaintiffs:
(a) invoice dated August 8, 2001 for $9,545.07;
(b) invoice dated September 15, 2001 for $6,200.00;
(c) invoice dated November 10, 2001 of which, based on my review, only the first four items of work described therein totalling $1,300.00 related to work undertaken as result of the June 15, 2001 order.
16. The work undertaken by Mr. Schaaf as a result of the June 15, 2001 order forms part of a statement and accompanying time log sheet for professional services, true copies of which are attached hereto and marked as Exhibit "G". These documents set out all the services provided by Mr. Schaaf over the course of the litigation. I have reviewed Mr. Schaaf's time log sheet and determined, based on the itemized descriptions therein, that the services provided from May 13, 2001 to September 16, 2001 pertained to a review of the Seed Hawk defendants' amended pleading, the additional prior art documentation and the third (second supplemental) affidavit of Mr. Anderson that was the subject of the June 15, 2001 order and the preparation of a further affidavit of Mr. Schaaf in response thereto. Adding together the figures that correspond with these particular items of work yields a total of $9,112.50, which amount has been paid by the plaintiffs.
17. Plaintiffs' counsel at trial consisted of two lawyers, Steven Raber and Dean Giles. Beginning in approximately August of 2001, they were assisted by Edward Hermann, an articling student who was called to the bar in June of 2002. Mr. Hermann was present in court for portions of the trial. None of Messrs. Raber, Giles or Hermann is a patent agent. For this reason, in order to provide advice and assistance with respect to the technical aspects of this case, the plaintiffs from time to time throughout the course of this litigation utilized the services of Adrian Battison. Mr. Battison is a patent agent with the firm Ade & Company.
18. It was apparent to me, and I was also advised by plaintiffs' counsel, that the advice and assistance of Mr. Battison was required to address the technical aspects raised by the Seed Hawk defendants' further amended statement of defence and counterclaim, additional prior art documentation and the further affidavit of Mr. Anderson. Mr. Battison rendered a total of four invoices totalling $19,481.34 in respect of these services, true copies of which are attached hereto and marked as Exhibit "H" and all of which were paid by the plaintiffs. I am advised by Mr. Battison and verily believe that the fees and disbursements referred to in these four invoices relate exclusively to the additional allegations, documentation and expert evidence that was the subject of the Seed Hawk defendants' motion heard June 8, 2001 and the resulting June 15, 2001 order.
19. When the trial reconvened on October 15, 2001, plaintiffs' counsel were required to re-open my direct examination so I could give evidence relating to the allegations contained in the amended statements of defence and, in particular, the allegation that Mr. Dyck had disclosed to me the invention described in the patent. I was then cross-examined on this issue on October 16, 2001 by counsel for the Seed hawk defendants, which was then followed by further re-examination.
20. I am advised by plaintiffs' counsel that, as a result of Mr. Justice Pelletier's order with respect to costs arising out of the June 15, 2001 order, a new file utilizing a separate matter number was opened at Fillmore Riley LLP. This was done on my instructions for the purpose of tracking the costs and disbursements arising from the Seed Hawk defendants' motion and resulting order and segregating them from those otherwise incurred during the litigation.
21. Attached hereto and marked as Exhibit "I" is a true copy of the disbursement portions of the three statements of account rendered to the plaintiffs under this separate matter number. I am advised by plaintiffs' counsel and believe that all the expenses referred to therein relate to steps taken as a result of the June 15, 2001 order, with the exception of monies shown as paid for witness fees and to the Receiver General for the issuance of subpoenas in one of the accounts, which were inadvertently posted to this matter number. With these items subtracted, the disbursements incurred by plaintiffs' counsel and paid for by the plaintiffs total $8,884.16, which I believe were reasonably incurred by plaintiffs' counsel in connection with the additional work made necessary by the June 15, 2001 order. Attached hereto and marked as Exhibit "J" is a complete listing of disbursements charged to and paid by the plaintiffs under this matter number.
22. In addition, the plaintiffs paid for disbursements incurred to respond to the defendants' motion heard June 8, 2001, prior to the opening of the separate file intended to track costs arising from the order of June 15, 2001. Such disbursements, which were paid by the plaintiffs and I believe to have been reasonable and necessary in the circumstances, are set out in two statements of account rendered by plaintiffs' counsel and total $2,516.77. Copies of the disbursements portion of these accounts are attached hereto and marked as Exhibit "K".
23. The plaintiffs also incurred expenses of their own as a result of steps made necessary by the June 15, 2001 order, as follows:
(a) as stated above, I was required to attend in Calgary for a further examination for discovery on September 4, 2001. Attached hereto and marked as Exhibit "L" are invoices totalling $649.58 which relate to return air fare from Regina to Calgary to attend at the examination for discovery, accommodation and meals while in Calgary and cost of parking. I also travelled a total of 200 kilometres from my home to the airport in Regina and back, resulting in mileage costs of $82.00, which I have calculated based on the government rate of 41 cents per kilometre;
(b) expenses relating to accommodation ($44.94 per night x 2 nights), long distance telephone charges and meals in Winnipeg on October 15 and 16, 2001 totalling $196.16, which days of trial were taken up by further direct examination, cross-examination and re-examination of me, as a result of the issues arising out the Seed Hawk defendants' motion and order of June 15, 2001, as more particularly described in paragraphs 10(b) and 19 above. Attached hereto and marked as Exhibit "M" are invoices relating to these expenses.
24. In summary, the specific disbursements incurred by the plaintiffs as a result of the order of June 15, 2001 allowing the defendants to further amend their statement of defence and add a counterclaim, introduce new documents and serve a further expert's affidavit are as follows:
David Schaaf $9,112.50
Dr. Sylvio Tessier $17,045.07
John Harapiak $8,880.00
Ade & Company (patent agent) $19,481.34
Legal disbursements $11,400.93
Plaintiffs' disbursements $927.74
TOTAL $66,847.58....
The Court, in Nash v. Sanjel Cementers Ltd., [1999] F.C.J. No. 1580 (F.C.T.D.) permitted the use of a patent agent as a means for less cost and more efficient process.
[260] The Plaintiffs argued that the Costs Thrown Away Decision cannot be considered in a vacuum. It occurred in the course of the trial and after Mr. Halford's testimony was essentially complete, ie. his direct examination and cross-examination had been completed. The Plaintiffs' position at the time (June 2001) was that such extraordinary relief during the trial would result in significant prejudice for them. The trial judge was advised of the additional and significant work that would result for the Plaintiffs and of the need to remedy or minimize that impact. The Seed Hawk Defendants' premise of costs associated with work already performed and rendered useless as a result of the relief granted, ie. a dropped cause of action, is irrelevant because that ignores the context in which the trial judge granted this relief. That is, the existing allegations remained, but were now supplemented by new allegations of invalidity. The only costs which could possibly have occurred were those associated with steps taken directly as a consequence of the relief granted by the Costs Thrown Away Decision. Said decision read as a whole simply identifies the various steps required of both sides, acknowledges that there will be costs consequences and directs that the Plaintiffs will recover costs associated with those additional steps. That is, had the Defendants not sought and been given this relief, the Plaintiffs would not have been placed in this situation of prejudice. To minimize this prejudice, costs were awarded for this additional work imposed on the Plaintiffs.
[261] The Plaintiffs argued that Milliken, supra (F.C.T.D.) is irrelevant. There, the plaintiffs sued for copyright infringement. Two months before trial, the defendant sought and received permission to amend its defence by adding an allegation that the plaintiffs had no standing to sue. The motions judge awarded costs of the motion to the plaintiffs in any event of the cause and reserved to the trial judge any further costs which were a direct result of the late amendment to the statement of defence. The plaintiffs' case was eventually dismissed, but for reasons that had nothing to do with the issue of standing. The amended defence was filed late. On the first day of trial, the trial judge granted an extension of time to the defendant without costs, but with leave to make submissions on costs thrown away, if any, as a result of the amendment. The Court rejected the argument that things such as costs of discovery, pre-trial notices and preparation of witnesses became costs thrown away as a result of the amendment:
... [7] Costs thrown away are those which are wasted for work rendered useless as a result of the amendment sought, either because an issue has been withdrawn, abandoned or otherwise rendered moot. The expression is well illustrated in the following example given by Bouck J. in Cominco Limited v. Westinghouse Canada Limited et al., [1980] B.C.J. No. 1353:
For example, a plaintiff may completely change his case in midstream from one of negligence to one of breach of trust. To meet this new allegation a defendant may have to entirely revise his defence and conduct new examinations for discovery. The old defence and the old discovery would have become useless and so the defendant would be entitled to the cost of these proceedings because he was put to the expense of defending allegations in negligence which were subsequently abandoned by the plaintiff and changed to breach of trust. It is as if the plaintiff's case for negligence was dismissed or discontinued and a fresh action for breach of trust was begun.
But some amendments do not establish an entirely new claim. Often there is no need for a defendant to amend his defence after a plaintiff has amended his statement of claim. If a new discovery is required it might just be for a limited purpose and most if not all of the earlier discovery might still be useful. In that sense the cost of the earlier discovery would not have been completely "thrown away". Only a part would have been lost.
[8] Costs thrown away must be distinguished from costs of and incidental to an amendment which are costs incurred from the time of the amendment onwards and are part of the award of costs after the event at trial. As stated in Cominco:
... [I]t seems the term "costs thrown away" is a phrase which is often included in an order where one party is given an adjournment of a trial or leave to amend or both. It would also appear to cover the same ground as an order for "costs of and incidental to" an adjournment or an amendment as the case may be.
Any costs incurred by the defendant from the time of the amendment onwards would seem to be at large; that is to say they follow the event after the trial. In this instance if the plaintiff succeeds, it gets these costs. If the defendants win, the costs are theirs. All of these orders are, of course, subject to the discretion of the trial Judge....
[Citations omitted]
None of this fits the circumstances here, ie. costs to compensate the Plaintiffs for prejudice caused by work arising only because of the relief granted to the Defendants, all occurring in the middle of the trial.
[262] The Plaintiffs rejected the premise of the Seed Hawk Defendants, ie. that if costs associated with the 2nd Anderson Affidavit, the 2nd Supplemental Anderson Affidavit and the 3rd Supplement Anderson affidavit are discounted on this assessment of costs because they were not used in evidence at trial, then it follows that the costs associated with Mr. Harapiak's third affidavit and with Mr. Schaaf's second affidavit should also be discounted because both of these latter affidavits, prepared solely in response to the 2nd Supplemental Anderson Affidavit, also were not tendered as evidence at trial. That is, these latter two affidavits are on a different footing than Mr. Anderson's affidavits because they flowed from the Costs Thrown Away Decision. They would not have been prepared, but for the need to respond to the 2nd Supplemental Anderson Affidavit. Ultimately, the 2nd Supplemental Anderson Affidavit did not go in. Therefore, it was unnecessary to tender the third Harapiak affidavit and the second Schaaf affidavit, but the costs for their preparation are still recoverable further to the Costs Thrown Away Decision.
[263] The Costs Decision read:
... [43] If, in those circumstances, it was an error to consider that the plaintiffs in Illinois Tool Works Inc. had achieved success with respect to the counterclaim for invalidity, I cannot see how it would not be an error to come to the same conclusion with respect to the plaintiffs' defence of the counterclaim. Consequently, the plaintiffs are not entitled to any costs with respect to the defence of the counterclaim.
COSTS OF OTHER PROCEEDINGS
[44] The considerations which led me to conclude that the appropriate scale for the Seed Hawk defendants' costs, prior to consideration of the issue of offers of settlement, was the bottom end of column IV lead me to the same conclusion with respect to the plaintiffs' costs. Consequently, for those matters with respect to which the plaintiffs are entitled to costs, those costs shall be assessed at the bottom end of column IV of Tariff B.
[45] By way of clarification, and to avoid any confusion, the plaintiffs are only entitled to the costs of those matters with respect to which they were awarded their costs in any event of the cause. Motions and other proceedings within the trial are all to be treated as costs in the cause unless a specific order or direction to the contrary was made. I have already indicated my view that the equities are evenly divided as between the parties in terms of the conduct of the action. Consequently, I decline to intervene to deny or reduce the costs to which the defendants are entitled, or to increase the costs to which the plaintiffs are entitled, on the basis of the plaintiffs' allegations of delay or other misconduct. Now that the trial is done, everyone can think of ways in which it could have been conducted differently. As it was unfolding however, everyone did what they thought they had to do to protect their position. While there are things which could have been done differently, I find no egregious abuse of the process which would justify departing from the ordinary course....
[264] The Plaintiffs argued that the Seed Hawk Defendants' premise concerning paras. [43] and [45] is incorrect, ie. that because said paragraphs restrict the Plaintiffs to only awards of costs in any event of the cause and refuse the Plaintiffs any counterclaim costs and because the work following the Costs Thrown Away Decision addressed the defence of the counterclaim for invalidity, it would be an inconsistent reading of these two decisions to allow any of these claimed costs. Rather, the subject of the work is irrelevant and the correct reading, which does not put the decisions in conflict, is that the Plaintiffs are not entitled to any costs except where a previous order, such as the Costs Thrown Away Decision, exists giving the Plaintiffs their costs in any event of the cause.
[265] The Plaintiffs disagreed with the Seed Hawk Defendants' interpretation of the Costs Thrown Away Decision as addressing recovery of costs for steps already taken, but not steps to be taken. That is, para. [21], reading "... have their costs thrown away resulting from any step undertaken as a result of the granting of the relief sought by the Seed Hawk Defendants from those defendants only in any event of the cause", when read with the operative portion of the order, "... reasonable costs thrown away as a result of any steps taken pursuant to this order in any event of the cause, such costs to be spoken to at the conclusion of trial of this matter", cannot be read as if in the past tense. The plain grammatical sense is for costs to the Plaintiffs for steps to be taken as a result of the relief granted. The record discloses that the motion record before the trial judge in June 2001 made it clear that this was not a situation of a defence previously advanced now being withdrawn nor of Mr. Anderson rescinding or backing away from some evidence given or conclusions expressed in a previous expert affidavit. Rather, the trial judge was aware that this extraordinary relief would require the Plaintiffs, to their prejudice, to take several additional steps. His remedy for that prejudice was the award of costs thrown away. The term "costs thrown away" may have clouded his intent, but he knew that this was not a situation of the Plaintiffs having to redo previous work or rendering wasted the Plaintiffs' previous work. There is no evidence that those circumstances existed.
The Seed Hawk Defendants' Position
[266] The Seed Hawk Defendants' Written Submissions In Regard to Plaintiffs' Bill of Costs, dated June 24, 2005 (hereafter the "Seed Hawk Defendants' Written Submissions"), read:
...11. An order for "costs thrown away" typically made in cases of amended pleadings refers to those costs which have been wasted by the opposite side for work rendered useless as a result of the amendment. For example, an amendment to the pleadings by a Plaintiff to drop a cause of action would result in costs thrown away by the defendant in respect of effort made to defend such dropped cause of action.
12. However, where the amendments are more by way of clarification and a defendant amends its pleading to add further defence, even where the case is disposed of on grounds (non-infringement) not relating to the amendments (further pleas of invalidity), such an order providing for "costs thrown away" does not necessarily mean the Plaintiff has had "costs thrown away" due to the amendments.
Milliken & Co. v. Interface Flooring Systems [1998] F.C.J. No. 541 (FCTD) per Tremblay-Lamer J. Tab A hereto
13. In Milliken, the Plaintiff was awarded "costs thrown away" as a result of an amendment by the Defendant to its defence obtained with leave from the court to plead a further ground of defence. The Plaintiffs argued that the amendment was the basis on which its action was dismissed, and the late amendment caused them prejudice because they had "thrown away" all their costs and efforts in meeting, up to the date of the amendment, the other grounds of defence....
14. The Court held in Milliken that the amendment was not the basis for the Court's dismissal of the Plaintiffs' action, and that the Plaintiff still had to prove grounds for its copyright infringement action, which they failed to do. The Plaintiffs intended to proceed despite the deficiencies in proving their title to copyright which ultimately was the ground for dismissal of the action for infringement. (Likewise, in the case at bar, the burden in always on the Plaintiff, upon some evidence of potential invalidity, to establish the patent is valid). As a result, Mme Justice Tremblay-Lamer, in considering the Order of Richard, J. which directed the Plaintiffs be able to recover their "reasonable costs thrown away" arising from the amendment, held that there were no costs thrown away....
15. In Milliken, Mme Justice Tremblay stated as follows:
Costs thrown away are those which are wasted for work rendered useless as a result of the amendment sought, either because an issue has been withdrawn, abandoned or otherwise rendered moot....
Costs thrown away must be distinguished from costs of and incidental to an amendment which are costs incurred from the time of the amendment onwards and are part of the award of costs after the event at trial....
16. Accordingly, with the exception of possibly para. 10(f) & (g) of Halford's Affidavit in support of the Plaintiffs' Bill of Costs which dealt with expert fees incurred to reply to the third affidavit of Clifford Anderson which was ultimately not tendered at trial, and para. 10(h) which dealt with consideration of a fourth affidavit of Clifford Anderson which within about a week of its service was immediately withdrawn, and para. 10(a) dealt with above, none of the remaining items listed in paragraphs 10(b)-(e) of Halford's affidavit in respect of which the Plaintiffs claim costs [see Plaintiffs Assessment Record, Tab 2, page 6] are costs "thrown away" within the meaning of that term accorded by case law, and are merely costs in attempting to prove their cause of action, which they always had to prove. No costs should thus be awarded to the plaintiffs under this heading.
17. In any event, the Plaintiffs' claims for costs arising from the June 15, 2001 amendments have the further following deficiencies, as set out below:
(i) with respect to item A(1) [preparation and filing of a Reply], the Reply which was filed (See TAB B hereto) (a mere 7 paragraphs) was a simple denial of all allegations of the Amended Statement of Defence. The Plaintiffs have claimed a unit of '6', which is not at the lowest end of column IV. The Plaintiffs, if entitled to any claim under this heading, for such a simple Reply should only be awarded a unit allocation of '5';...
(ii) With respect to item B-Motion, the Plaintiffs have claimed an amount of $550 for preparation, and $660 for attendance on the motion of June 15, 2001. The Order of Pelletier J., while providing for reasonable costs thrown away as follows:
"The plaintiffs shall recover their reasonable costs thrown away as a result of any steps taken pursuant to this order in any event of the cause, such costs to be spoken to at the conclusion of the trial of this matter"
was silent as to costs of the motion itself, on which the Seed Hawk Defendants were completely successful. Accordingly, if any party is to obtain costs in respect of this motion, it would have been the Defendants, as they were completely successful in obtaining the relief sought on the motion.
The Seed Hawk Defendants have made no claim for their costs in respect of this motion, although arguably such costs could have been claimable under the Pelletier, J's general Order regarding Costs dated September 16, 2004.
As the June 15, 2001 Order of Pelletier was silent as to costs of the motion per se, the Plaintiffs cannot claim any award of costs for the motion. Accordingly, the claim of $550 for preparation, and $660 for attendance on the motion in their Bill of Costs should be denied in its entirety....
(iii) With respect to item C Discovery and Examinations, Item 7, "inspection of documents", ...
(iv) With respect to item C - item 8 preparation for examination of N. Beaujot August 2, 2001, and J. Halford, Sept. 4, 2001, ... any charge for preparation for the examination of J. Halford (which examination was conducted by the Seed Hawk Defendants), would have been done in respect of his earlier discoveries, and should not be allowed.
(v) With respect to item C-sub-item 9, attending on examination, per hour, of N. Beaujot August 2, 2001, and J. Halford September 4, 2001,
(vi) With respect to item D-attendance on case conference, the Plaintiffs have made a claim for $110 for attendance on a case management conference with Justice Pelletier August 3, 2001 prior to recommencement of the trial October 15, 2001. This case management conference is not "a cost thrown away" pursuant to the June 15, 2001 amendments, and was not otherwise awarded to the Plaintiffs. This amount should be denied.
With respect to item D-Preparation for Oct. 15, 2001 re-opening of Halford Direct- This is not a "cost thrown away" pursuant to the June 15, 2001 amendments. This amount should be denied....
(vii) With respect to item E. Trial-Halford Direct Reopened- This is not a "cost thrown away" pursuant to the June 15, 2001 amendments. This amount should be denied. In any event, the re-opened direct of Halford was straightforward and principally dealt with one item of the amended defence (when, and if, he was provided with drawings of the device by Ben Dyck), over the course of pp. 618-656 of the trial transcript (ie from mid-morning to 2:10 pm in the afternoon of the first day of Court- not the 5 hours claimed.) In any event, "2" units should have been selected as opposed to '3' units.
Trial Transcript, October 15, 2001, pp. 618-656, and p. 656
(viii) With respect to item E. Trial- October 15, 2001 Halford direct re-opened/ 14(b) second counsel- the same considerations apply as per sub-para (vii) above.
(xi) With respect to the claim for Experts Fees and Disbursements, for the reasons set out in paras. 12-17 above, as these expert fees were not properly "costs thrown away", they should be disallowed.
In any event, the Seed Hawk Defendants submit substantial overclaiming has occurred with respect to the Plaintiffs' expert fees in the circumstances, for the following reasons:
re: fees of $17,045 claimed in respect of Dr. Tessier:
· the $17,045 claimed appears to have been for responding to the second supplemental affidavit of Clifford Anderson. In this respect, Dr. Tessier prepared and filed a third affidavit, a copy of which is affixed as Tab D hereto.
As may be seen from Tab D, substantial and significant portions were ordered struck, and were not admitted into evidence.
Where significant portions of an expert's affidavit has been held inadmissible, significant discounting of his fees for which any costs may be awarded should be done.
ref. Bayliner Marine v. Doral Boats, (1987) 15 C.R.P. (3d) 201 (FCTD) per Walsh, J. at p. 207-208 (Tab E hereto)
· With respect to the $8725 amount claimed regarding the November 10, 2001 bill for Sylvio Tessier, as stated by James Halford in his affidavit, at page 9, para. 15(c), only the first four items of that bill totalling $1300 "related to work undertaken as a result of the June 15 order". Accordingly, the $17,045 amount claimed for Dr. Tessier is excessively inflated by $7425.
Affidavit of James Halford, Plaintiffs' Assessment Record, Tab 2, page 9, para 15(c)
re: Fees in the amount of $8880 claimed in respect of John Harapiuk-
With respect to the $8880 disbursement in respect of John Harapiuk, it is noted that this amount was incurred in respect of preparation of his third affidavit, in response to the second supplemental affidavit of Clifford Anderson for which leave was obtained to serve and file as a result of the June 15, 2001 motion.
However, such third affidavit of Harapiuk was not tendered into evidence at trial. It is noted that the Seed Hawk Defendants have made claim for expert fees in respect of fees of Clifford Anderson for Anderson's second affidavit, second supplemental affidavit, and the third affidavit each of which likewise were prepared but not tendered into evidence at trial. Accordingly, if a portion of the fees of Anderson claimed by the Seed Hawk Defendants are not allowed for the reason that such additional affidavits were not tendered at trial, then so too should the expert fees of Harapiuk regarding his third affidavit be disallowed.
re: Fees in the amount of $9112.50 claimed in respect of David Schaaf
With respect to the $9112.50 disbursement claimed in respect of David Schaaf, such was in respect of preparation of his second affidavit, also in reply to the second supplemental affidavit of Clifford Anderson for which leave was obtained to file as a result of the June 15, 2001 motion. Such third affidavit of Schaaf was not tendered into evidence at trial. Again, if a portion of the fees of Anderson claimed by the Seed Hawk Defendants are not allowed for the reason that such additional affidavits were not tendered at trial, then so too should the expert fees of Harapiuk regarding this third affidavit be disallowed.
18. Insofar as the Plaintiffs may be held to be able to recover any costs in respect of the June 15, 2001 amendment, the co-defendant Simplot takes the position that it is not liable for any share of these costs.
19. However, Simplot's liability for alleged inducing patent infringement would occur only if liability for infringement was first found against the Seed Hawk Defendants. Accordingly, Simplot obviously and clearly directed benefited from amendments to the respective Statements of Defence by the Seed Hawk Defendants, and chose to include such further grounds in its amended Statement of Defence to plead such further grounds of invalidity.
20. Simplot also benefited from the further buttressing of Seed Hawk Defendants' expert evidence as to invalidity of the patent by the filing of a further expert affidavit, namely the second supplemental affidavit of Clifford Anderson, in respect of which leave to file was granted by Pelletier J. on such motion of June 15, 2001.
21. It is submitted the co-defendant Simplot cannot "have its cake and eat it too" - namely it should not be permitted to obtain the benefit of amendments to the Statements of Defence alleging further grounds of invalidity, better expert affidavit evidence on invalidity, and a further Affidavit of Documents permitting reliance on photographs of prior art in furtherance of the defence of invalidity, yet seek to avoid its share of the Plaintiffs' alleged costs in this regard should they be awarded to the Plaintiffs arising from this relief granted to the Defendants....
NOTE: for convenience, the submissions advanced as an alternative argument, ie. that the lowest value in the available ranges for counsel fees should have been used, are omitted because they were substantially identical to those for item 1 (the reply to the amended defence).
[267] The Seed Hawk Defendants argued that the provision in the Costs Decision for fees for second counsel precluded a non-lawyer, such as the patent agent. If he had been a lawyer, recovery if any would be limited to the partial indemnity limits of the tariff and not full indemnity by way of the device of a disbursement. Authorities such as J.M. Voith GmbH v. Beloit Corp., [1990] F.C.J. No. 1083 (F.C.T.D.) have held such disbursements to be non-recoverable overhead.
[268] The Seed Hawk Defendants argued generally that the Costs Thrown Away Decision and the Costs Decision should not be read so as to give rise to a conflict. For example, the express language in the Costs Decision precluded costs of the counterclaim. The trial judge did not award costs for "steps to be taken", but rather costs thrown away for "steps taken". This latter provision is to be taken as the past tense. Thus, if the experts' affidavits, existing at the time of the Costs Thrown Away Decision and referred to in para. 11 of the Costs Thrown Away Halford Affidavit, were to be rendered useless because of the steps taken, ie. such as the recanting by Mr. Anderson of certain portions of his expert opinion previously served, further to the relief granted by the Costs Thrown Away Decision, the costs of the previous work by the Plaintiffs' experts in responding to the now recanted opinion of Mr. Anderson would clearly be caught by the "costs thrown away" provision and be recoverable by the Plaintiffs. That is, if prior to the Costs Thrown Away Decision, the Defendants had put forward proposition X, had withdrawn proposition X because of steps taken further to the Costs Thrown Away Decision and had advanced proposition Y further to the Costs Thrown Away Decision, then any costs associated with steps taken by the Plaintiffs to address proposition Y are not costs thrown away, but any costs associated with steps already taken by the Plaintiffs to address proposition X are costs thrown away. The Costs Thrown Away Decision did not somehow permit the Plaintiffs to segregate their additional work required by that decision from their other work in this litigation, all of which was ultimately unsuccessful and for which the Costs Decision denied costs, except as provided for by interlocutory awards in any event of the cause. The Seed Hawk Defendants argued that the Plaintiffs' position requires me to accept that the trial judge in June 2001 surrendered his discretion for costs before substantially hearing the case.
[269] The Seed Hawk Defendants conceded that there could be some ambiguity in para. [14] of the Costs Thrown Away Decision, ie. whether the last sentence, providing that the "additional expense incurred in taking these steps is a matter for costs", refers to costs of the action or to costs thrown away. That is, he could be referring to the additional expense of having to redo work or to the costs of the litigation resolved in the Costs Decision, given the provision in the Costs Thrown Away Decision that the costs thrown away were to be spoken to at the conclusion of the trial. As well, there could be some ambiguity in the wording of para. [21], ie. does "costs thrown away resulting from any step undertaken as a result of the granting of the relief sought" refer to a "step" already taken or a "step" yet to be taken? However, Milliken, supra (F.C.T.D.) represents the historical and accepted notion of costs thrown away which must apply here, even if its facts are not identical to those here. The Court there, at paras. [10] and [11], noted that even if the issue of standing had disposed of the case, there still would not have been cause for costs thrown away because the discovery, pre-trial notices and witness preparation would not have been wasted. The Plaintiffs' position here would essentially gut the trial judge of any discretion for costs before having heard the case. That is, the trial judge here, at the instant of the Costs Thrown Away Decision, had yet to see and consider any of the evidence or propositions formulated specifically as a function of said decision and it would not make any sense that, in those circumstances, he surrendered any discretion possible in the future Costs Decision for the costs associated with either side for said work and instead gave said costs in June 2001 to the Plaintiffs in any event of the cause. That is, the Costs Thrown Away Decision did not relieve the Plaintiffs of the burden of proving their case. They did not and were denied costs associated with the work performed, which included the work subsequent to the Costs Thrown Away Decision. The Plaintiffs may have been unhappy that said decision caused additional work for them to overcome the additional defences permitted, but the evidence is that said additional work was part of their overall unsuccessful work to prove their case and not work rendered useless. To permit these claimed costs would be to implicitly contradict the denial in the Costs Decision of the Plaintiffs' costs of defending or meeting the defence of invalidity. As for the Simplot Defendant's responsibility for costs, should I allow any, the trial judge did not provide that the Simplot Defendant should be shielded in some way from said costs.
[270] The Seed Hawk Defendants noted disbursements ($13,249.54 consisting of $12,382.81 + $866.73 GST) by the Plaintiffs' solicitor for things such as facsimiles, postage, long distance, couriers, photocopies and reproductions, travel, transcripts, Quicklaw searches and agents' fees. The evidence is that $1,962.77 of the $12,382.81 relates to Reconsideration Decision. However, that includes $160.50, presumably for the transcript that was before the trial judge, which should be removed, leaving $1,802.27 allowable to the Plaintiffs pursuant to the Reconsideration Decision. The resulting balance of the $12,382.81 is $10,420.04. The motion for reconsideration was heard in Winnipeg. Therefore, the claim of $882.68 must relate to costs for the Plaintiffs' counsel to travel to Regina in June 2001. However, as noted above, the Costs Thrown Away Decision was silent as to costs of the motion itself. Therefore, the $882.68 is not recoverable and the resulting balance of the $12,382.81 is now $9,537.36 (at this time, Mr. Giles helpfully noted that para. [21] of the Costs Thrown Away Halford Affidavit pegs the disbursement claim through the Plaintiffs' solicitors as $8,884.16). These are costs for the additional work required of the Plaintiffs by the Costs Thrown Away Decision to prove their case and are not recoverable as costs thrown away.
The Simplot Defendant's Position
[271] The Simplot Defendant argued that paras. [3] and [5] of the Costs Thrown Away Decision demonstrate the understanding by the trial judge (as motions judge) of its limited role in this matter and therefore this language in para. [21] thereof, "... have their costs thrown away... the Seed Hawk defendants from those defendants only in any event of the cause" [emphasis added], meant that only the Seed Hawk Defendants are responsible for any costs thrown away, notwithstanding that the Simplot Defendant would benefit by the additional latitude given to the Seed Hawk Defendants. Other than appearing on a watching brief during the discovery of Mr. Beaujot on August 2, 2001, the Simplot Defendant played no role relative to the asserted work in the Costs Thrown Away Halford Affidavit. That work related to the Seed Hawk Defendants as opposed to the Simplot Defendant. Nothing is recoverable for the patent agent.
[272] The Costs Thrown Away Decision was silent as to costs of the motion itself. Further to Milliken, supra (F.C.T.D.), costs thrown away refer to costs wasted for work rendered useless or moot as a result of the interlocutory relief granted and are separate from the costs of the motion itself. Further, they are distinguishable from costs incidental to the interlocutory relief granted. These latter costs are ongoing from the time of the granting of said relief and are part of the award of costs after the event of the trial. Surely, the trial judge understood the principle of costs thrown away in rendering the Costs Thrown Away Decision.
Assessment
[273] In a very rough sense, the October 31, 2000 order granted leave, relative to amendments of pleadings, additional discovery and expert evidence, somewhat similar to that in the Costs Thrown Away Decision. Paragraph 4 of the former decision did not mention costs thrown away, but did give to the Plaintiffs their costs of the further discoveries of the Defendants in any event of the cause. If I was to alter the Costs Thrown Away Decision by removing the words "thrown away" wherever they appear, I would be left with a provision comparable to para. 4 of the October 31, 2000 order and there could be no question that the trial judge, sitting in June 2001 as a motions judge, had surrendered or fettered any residual discretion and had decided, before seeing and considering in his role as trial judge the results of the work from both sides flowing from the relief in the Costs Thrown Away Decision, that only the Plaintiffs would have any associated costs thereby precluding the Defendants from any costs, all regardless of who was ultimately successful.
[274] However, the words "thrown away" were used. I think that there is ambiguity with particular regard to the last sentence of para. [14]. I assessed, as for several of the cases cited before me, the bill of costs led further to Milliken, supra (F.C.T.D.). Paragraph [95] of my decision, supra (A.O.), commenting on the passage relied upon by both sides here, read:
This passage undermines the Defendant's position because it appears to suggest that costs thrown away are not part of the award of costs after trial. Put another way, costs thrown away are distinct from the award of costs after trial because they are associated with a single occurrence, ie. adjournment or amendment, at one point in time in the continuum of litigation, but not the several events along the continuum of litigation, ie. pleadings, discoveries, case preparation, appearance at trial, that an award of costs after trial embraces. For example, costs thrown away further to an amendment address work prior to the amendment and which the amendment rendered useless. Any work after the amendment is not part of this "useless" work, but rather is work caught up generally in the several events along the continuum of litigation. Any costs associated with this latter work are costs at large, ie. not costs thrown away, but costs which may ultimately be recoverable as part of an award of costs after trial. From a simpler perspective, a motion for costs thrown away is interlocutory and is not a continuation of the trial. Interlocutory motions, being incidental to trial, can and do occur after trial. Their events are distinct from the event at trial. An order silent as to costs lacks the requisite and visible exercise of the Court's Rule 400(1) authority for costs. I refuse the item 5 and 6 costs claimed....
If I accept the Plaintiffs' position, effectively I have to conclude that the trial judge either did not understand the notion of costs thrown away in using that term in the Costs Thrown Away Decision or that he intended or was aware of a different or additional meaning not contemplated by Milliken, supra (F.C.T.D.).
[275] Orkin, supra at p. 2-144, para. 215.6, indicates that costs thrown away are compensatory and not punitive. The Costs Thrown Away Decision was consistent with that notion. Orkin, supra at pp. 2-146 and 2-147, para. 217, addressing unnecessary proceedings and p. 4-19, para. 408.3(2), addressing applications to amend at or on the eve of the trial do not, in my view, contemplate some notion, involving the fettering of the trial judge's ultimate discretion as to costs of the action, inconsistent with the historical notion of costs thrown away. A wider and general principle of costs is that they follow success in the event of the cause. However, the authorities and Rule 400(1) are clear that a trial judge may, in his or her discretion, depart from that principle depending on the particular circumstances. There was nothing here to suggest that, in June 2001, the trial judge had in mind circumstances of conduct on the part of the Defendants so egregious as to cause him to decide, after only three days presiding over a trial ultimately to consume 36 days over some four years, that the Plaintiffs should have the costs associated with any work directly resulting from the Costs Thrown Away Decision regardless of ultimate success. Indeed, in para. [45] of the Costs Decision, the trial judge was casting his mind back in time in commenting that the Plaintiffs' entitlement to costs should not be a function of a departure from the ordinary course.
[276] The amendments proposed by the Defendants were considerable. The additional work detailed in the Costs Thrown Away Halford Affidavit was considerable. Paragraph [14] of the Costs Thrown Away Decision, read in isolation, supports the notion that the Court intended that the Plaintiffs get the costs of this additional work. However, paras. [16] et seq. provide context for para. [14], ie. by noting that the existing framework of the Plaintiffs' case might be significantly impaired. Paragraph [19] then defines the core consideration, ie. how to resolve the need for the late amendments with the potential or apparent damage to the Plaintiffs' existing case framework all to preserve the essential "fact-finding nature of a trial." Paragraph [20] then notes circumstances particular to a trial in progress and, in my view, effectively turns the clock back by permitting the Plaintiffs to recast their case as they see fit. That relief included the vacating of the prohibition against discussions between Mr. Halford and his counsel of his evidence to date at trial. I am in the uncomfortable position of speculating on the view of the trial judge (as motions judge) of the circumstances as he concluded para. [20], but he must have known that this relief could render useless existing work by the Plaintiffs. Therefore, para. [21] would be the logical next and final element of the relief, ie. costs to the Plaintiffs, being costs thrown away, for any such wasted work.
[277] This sentence in para. [46] of the Costs Decision, "[T]here is already an order awarding the plaintiffs the costs of amendments to the pleadings and the costs thrown away resulting from those amendments," read with the next two sentences concerning details of those costs, is troubling if I presume that the implied message is that the trial judge has already decided that the Plaintiffs are indeed entitled to costs for this additional work subsequent, but not prior, to the Costs Thrown Away Decision and that the only issues left for me are linkage of items to the relief afforded by said decision and crystallization of the appropriate amount. With respect, even if there was jurisdiction for the trial judge, and I am unclear on that point, to purport via para. [46] to clarify (I think that he was simply trying to summarize) the Costs Thrown Away Decision, I do not think that the phrase in para. [46], "already an order awarding the plaintiffs the costs of amendments to the pleadings and the costs thrown away resulting from those amendments," does so. That is, the Costs Thrown Away Decision, unlike para. [46] of the Costs Decision, does not refer to costs of the amendments and to costs thrown away as if separate notions of relief. In particular, I do not think that the last sentence of para. [14] of the Costs Thrown Away Decision, "[T]he additional expense incurred in taking these steps is a matter for costs", supports a reading of such separate notions of relief. I do not think that para. [46] purported to add to the existing relief of the Costs Thrown Away Decision. The actual orders in each decision giving effect to the conclusions in each do not change my view. I simply do not accept that para. [46] equates to abandonment of the historical notion of costs thrown away.
[278] I conclude that the trial judge had in mind costs for steps already taken and rendered useless. The Plaintiffs, so convinced were they of their position, did not leave any doubt in their evidence that the costs claimed were for work not fitting this historical notion of costs thrown away advanced by the Defendants and accepted by me. Counsel for the Seed Hawk Defendants, in his oral submissions before me, did not highlight it, but para. 16 of the Seed Hawk Defendants' Written Submissions did concede the possibility that costs associated with the further discovery of Mr. Beaujot on August 2, 2001, and with the experts' work to respond to the 2nd Supplemental Affidavit and the 3rd Supplemental Anderson Affidavit, might be considered as thrown away. That may be inconsistent with their notion as advanced for costs thrown away. However, with respect, certain variances in the form of references in the Costs Thrown Away Decision concerning the need to compensate the Plaintiffs for possible prejudice arising out of the relief granted may have introduced an element of ambiguity which could be stretched to include future work. My feeling for this litigation is that the Costs Thrown Away Decision would not have occurred, in a limited sense perhaps, but for the fact that incoming counsel felt that certain work under Mr. Blair's supervision was inadequate or needed reworking. The latter two Anderson affidavits clearly flowed from the Costs Thrown Away Decision and caused work by the Plaintiffs likely rendered unnecessary by the fact that said affidavits were not ultimately tendered. Said work, in the context of Milliken, supra (F.C.T.D.), was simply work at large in proving their case and can be distinguished from work prior to the Costs Thrown Away Decision rendered useless by said decision. The costs associated with the Plaintiffs' work relative to the latter two Anderson affidavits, to be considered as thrown away, would have required a separate and subsequent decision to that effect. Alternatively, the circumstances of said work could have been advanced as a factor warranting a lower scale of costs in the Costs Decision for the Seed Hawk Defendants.
[279] As I usually state in the absence of submissions in response to an asserted bill of costs, the Federal Courts Rules do not contemplate a litigant benefiting by an assessment officer stepping away from a position of neutrality to act as the litigant's advocate in challenging given items in a bill of costs. However, I cannot certify unlawful items, ie. those outside the authority of the judgment and the tariff. I examine a bill of costs within those parameters and allow it if the amount claimed in total is generally arguable within the limits of the award of costs as reasonable in the circumstances of the litigation. Notwithstanding the absolute lack of evidence on the point, I simply do not believe that the relief granted by the Costs Thrown Away Decision did not result in previous work being rendered moot or useless. I considered whether it would violate my position of neutrality, in an attempt to put an end to this process, to allow something. However, in the face of strongly asserted evidence indicating the absence of costs fitting the historical notion of costs thrown away, I decided not to allow anything. That denial includes the item 5 and 6 costs respectively for preparation of and appearance on the motion itself.
[280] Given that denial of costs thrown away, there is no need to consider apportionment, but since the parties have spent considerable time and expense in framing their submissions, I will venture some obiter observations. I might have allowed a modest amount in the range of $3,500.00 to $4,500.00. Orkin, supra at p. 2-90, para. 209.5 indicates that the court may apportion costs against several parties, but the assessment officer should avoid doing so as far as possible. In Milliken, supra (A.O.), I felt that apportionment was necessary. Here, although the order itself did not so specify, I think that, consistent with Genpharm Inc., supra concerning a reading of the reasons to determine the Court's intent, para. [21] of the Costs Thrown Away Decision cannot be ignored: I would have found that the Seed Hawk Defendants are solely responsible for these costs thrown away. In calculating set-off in para. [305] below, I would first have subtracted $3,500.00, for example, from $8,591.01 (see para. [303] below: the total of the assessed amounts in favour of the Plaintiff) to give $5,091.01. The amount of $5,091.01 divided in half equals $2,545.505 (for this hypothetical exercise, I use $2,545.51 for convenience, although it does introduce a variance of $0.01). The amount of $2,545.51, set-off against the Simplot Defendant's assessed total of $258,292.03 (from para. [303] below), gives a net amount of $255,746.52 plus interest, which the Simplot Defendant could have recovered from the Plaintiffs. The amount of $2,545.51 plus $3,500.00, set-off against the Seed Hawk Defendants' assessed total of $544,327.10 (from para. [303] below), gives a net amount of $538,281.59 plus interest, which the Seed Hawk Defendants could have recovered from the Plaintiffs.
(iii) Costs of the motion, heard within the 2nd Trial Portion in 2001, to reopen the cross-examination of James Halford
[281] The Plaintiffs claim (all under Column IV) 5 units and 2 units per hour (available range 4 - 9 and 1 - 4 respectively) for items 5 and 6 respectively (preparation for and attendance of three hours on the Seed Hawk Defendants' motion to reopen Mr. Halford's cross-examination); 3 units (available range 2 - 6) for item 13(b) (preparation for the reopening in the 2nd Trial Portion in 2001 of Mr. Halford's cross-examination); 2 units per hour (available range 2 - 4) for item 14(a) (attendance at trial by first counsel on the reopening of Mr. Halford's cross-examination) and item 14(b) (claimed twice for each of two second counsel at 50% of the fees for item 14(a)). I have not set out the details in the bill of costs of counsel fee claims, ie. items 13(a), 14(a) and 14)(b), cross-referenced to both this motion and to costs thrown away. The motion itself was argued on October 15 and 16, 2001. On October 16, the trial judge delivered his ruling on the record. He canvassed the unfortunate circumstances during the 1st Trial Portion in 2000 and, at page 697 of the trial transcript, concluded that there had not simply been an inadequate treatment of certain issues in the cross-examination, but a complete absence of treatment. He then considered the potential prejudice involved and permitted the reopening of Mr. Halford's cross-examination on a limited scope concerning personal liability. He then noted that this matter should have been dealt with well before the resumption of trial and accordingly awarded the Plaintiffs their costs of the motion in any event of the cause.
The Plaintiffs' Position
[282] The Plaintiffs noted as background that Mr. Halford was the first witness called at the trial during the 1st Trial Portion in 2000, at which time his examination in chief and cross-examination by both the Seed Hawk Defendants and the Simplot Defendant were completed, leaving only re-direct if deemed necessary. The Costs Thrown Away Decision resulted in the need for this work, although the bill of costs attempts to segregate the work associated with the motion itself.
[283] It is illustrative of the difficulties posed throughout by the assessments of the eight bills of costs to set out this exchange on June 29, 2005 before me (pp. 1980 to 1986 of the transcript of the hearing of the assessment of costs):
... And in my submission, based on the June 15th order and Justice Pelletier's order on October 16th granting the plaintiffs the costs of that motion, all of those costs are rightly claimed by the plaintiff and recoverable in the amounts indicated, and I'd given you the amended amounts at the outset.
I'm not sure if I've helped you with that.
It's a bit of a confusion.
THE ASSESSMENT OFFICER: No, I think I follow it. I think I follow it along.
You mentioned his order of October 16th?
MR. GILES: Correct. There's no written order, as I recall. I believe that Justice Pelletier took a recess and then came back and simply read that decision into the record. So you will find it in the transcript.
THE ASSESSMENT OFFICER: So it will be in the trial transcripts....
MR. GILES: You can read it obviously; it's there.
But in any case, by the time the dust had settled, both of those days had been dedicated in their entirety to these issues, and it's for that reason that the plaintiffs are claiming their costs in the manner you see set out on, at the bottom of page 2 of the bill of costs.
THE ASSESSMENT OFFICER: So his oral order delivered from the Bench accounts for items, the two items, the two items 14(a) and then the second counsel 14(b)?
MR. GILES: Correct.
THE ASSESSMENT OFFICER: So he mentions second counsel or --
MR. GILES: No, he didn't mention second counsel. That's in there simply because there seemed to be an understanding in the September 16, 2004 order that this was an appropriate case for second counsel. Granted the comment was made in the context of the Seed Hawk defendants' costs, but it was a case, more generally in my submission, where second counsel were appropriate and allowed.
And to the extent that these two days of trial dealt with matters for which the plaintiffs are entitled to recover their costs, it shouldn't stand in any different footing than the balance of the trial, the remaining days at trial in respect to which the Seed Hawk defendants are claiming, quite rightly, and it's two counsel across the board for all of those days.
THE ASSESSMENT OFFICER: So just so I understand the submission, and it's not necessary to read through the transcript with me, but this -- is it a combination of this October 16, 2001 ruling plus the June 2001 ruling that gets you to making the claim, or is it just simply flowing from the October 16th ruling?
MR. GILES: It's a combination of the two. And I appreciate that it's a bit of a confusing issue and I'm probably not helping any, but the portions of the time spent on both of those days is dedicated solely to the reopening of Mr. Halford's direct examination and that was made necessary by the amendments in the further amended statement of defence and counterclaim that my friend filed following on the June 15, 2001 motion.
That's, those are the allegations that essentially claimed that Mr. Dyck had disclosed the substance of the invention to Mr. Halford and in order to deal with -- because Mr. Halford's evidence was already in by that point, then we get these new allegations, it's necessary to put Mr. Halford back in the box --
THE ASSESSMENT OFFICER: Right.
MR. GILES: -- and have him give evidence in chief on the point.
And, in fact, if you go back to the June 15, 2001 reasons for order, as I indicated previously, Justice Pelletier expressly indicated that that would need to happen and that that's one of the necessary steps that would follow from the granting of the relief.
THE ASSESSMENT OFFICER: Certainly he removed the restriction in terms of Mr. Raber talking to Mr. Halford, so I can see that nexus in terms of the June 15th and the reopening of the direct of Mr. Halford.
So then we have this October 16th, I believe it's an oral application for cross-examination. So I guess what we're dealing with --
I think I see that, I think I see what's going on. I was following you before, but I guess the, you know, the June 15th leads to the direct and the October 16th oral is dealing with reopening the cross-examination.
MR. GILES: Pretty close.
THE ASSESSMENT OFFICER: Or not quite?
MR. GILES: Well, I mean you're, I guess you're finding out firsthand what the rest of us have known for a long time. It's a case with a lot of twists and turns, but that's --
THE ASSESSMENT OFFICER: I hope I'm close too.
MR. GILES: You're very close. All I'd add to that is that if you separate the further testimony of Mr. Halford into his further direct examination, his further cross-examination and his redirect, that may be one way of looking at it.
The reopening of the direct examination pertains exclusively to the June 15, 2001 order.
THE ASSESSMENT OFFICER: The reopening -- and the cross-examination -
MR. GILES: Covers the --
THE ASSESSMENT OFFICER: -- deals with the or flows from this October 16th occurrence, but I assume that where you're taking me is that the October 16th occurrence would not have occurred but for the June 15th?
MR. GILES: Well, the redirect, sorry, the reopened direct examination deals exclusively with matters arising out of the June 15, 2001 order. Now Mr. Halford, or sorry, Mr. Raber completed that direct examination and what follows from that or what followed that was Mr. Macklin's cross-examination.
Now Mr. Macklin cross-examined both with respect to matters that had been covered on that redirect, so certain portions of Mr. Macklin's cross-examination also flow back to the June 15th, 2001 order, but other portions of it relate exclusively to the October 16th order, wherein the Seed Hawk defendants were given permission to reopen the cross-examination beyond that in respect of these issues of personal liability.
THE ASSESSMENT OFFICER: Okay, so I think I have that.
MR. GILES: And then the -- I'm heartened by Mr. Horne's nodding of the head because I'm starting to confuse myself I think, but then you have Mr. Raber's relatively brief redirect that presumably covered both of those areas as well, addressing solely the matters that came up fresh in Mr. Macklin's cross-examination.
And frankly, given the rather unique situation, this was the best way I could find of breaking that out and that's why it has been done in that fashion.
At the end of the day, where you get to is this, and I mentioned this a moment ago, both October 15th and October 16th were solely devoted to these issues, so whether or not you track it back to the June 15th order or to the October 16th oral decision of the trial judge, these are the plaintiffs costs. The entire two days were dedicated solely to these issues.
Now my friend will say that, "We brought a motion, the Seed Hawk defendants brought a motion to reopen the cross-examination. It was successful, but an award of costs was made and that award of costs is limited to the motion itself". In my submission, that's an overly narrow reading of what Justice Pelletier intended.
Frankly, it doesn't make a whole lot of sense, from my perspective, to simply award the costs of that motion and then to simply treat the reopening of the cross-examination itself that flowed from that motion as an item to which my friends are entitled to their costs.
It's all part and parcel of the motion to reopen the cross-examination. It took up the whole of the two days and, for that reason, it's in the plaintiffs' bill of costs and rightly so, in my submission.
So I hope I've helped with that.
THE ASSESSMENT OFFICER: No, it's clarified. I can anticipate where Mr. Horne may go, but certainly I'm clear as to what your position is....
The Plaintiffs noted that, given that they are claiming for the trial costs for all of October 15 and 16, 2001, the Seed Hawk Defendants and the Simplot Defendant are precluded from claiming costs for both of those days.
The Seed Hawk Defendants' and the Simplot Defendant's Respective Positions
[284] The Seed Hawk Defendants argued that the oral order on October 16, 2001 limited the Plaintiffs to costs of the motion only, ie. items 5 and 6 which should be reduced to the minimum 4 units and 1 unit per hour respectively given that the Plaintiffs unsuccessfully opposed the motion. However, I have no jurisdiction to effectively allow the further costs associated with the actual reopened cross-examination of Mr. Halford, ie. the item 13 and 14 claims. To the extent that the Costs Thrown Away Decision could be considered as a factor, it does not permit me to allow these additional costs. The oral ruling on the motion did not shield the Simplot Defendant from having to share equally in the burden of the costs, which it should be required to do for the reasons above. The Simplot Defendant argued that it is not responsible for any of these costs because the motion related solely to the Seed Hawk Defendants.
Assessment
[285] The oral ruling on October 16, 2001 and the Costs Decision did not contain a provision comparable to that found in the October 31, 2000 order, ie. that the Plaintiffs would have their costs in any event of the cause associated with steps taken as a function of the relief granted. Thus, from the instant of the rendering of the oral order on October 16, 2001, item 13 and 14 costs were still undecided and pending for both sides. The Costs Decision resolved that uncertainty in favour of the Defendants, thereby precluding the Plaintiffs from any item 13 and 14 claims. As I noted above, the combination of the term "at the low end of Column IV" in the Costs Decision and the overlapping of ranges for items 5 and 6 in Columns III and IV may have had unintended consequences. I allow items 5 and 6 at the minimum values noted by the Seed Hawk Defendants, but disallow all of the item 13 and 14 claims. There were not any disbursements identified.
[286] The trial transcript indicates that brief submissions on the motion were led on October 15, 2001, followed by fuller argument on October 16, 2001. Just before his oral ruling on October 16, the trial judge retired to consider his ruling. He came back and put certain questions to counsel (against this background of the issue of the adequacy of Mr. Blair's cross-examination of Mr. Halford) eventually leading to an unchallenged comment by Mr. Macklin (trial transcript, p. 692) that "it was Mr. Riedel representing Simplot, which of course has been also sued, and sued on the basis that Simplot was inducing Seed Hawk, and presumably the individual Defendants, to infringe, and also that they were aiding and abetting in the infringement and, therefore, Mr. Riedel's questions, in my respectful submission, are directed to the liability of Simplot rather than of the Beaujots who, if you will, in this particular exchange were not being represented by their counsel." The trial judge then took some time to lay out his considerations before giving his ruling. I think that it is open for me to infer that he may have considered these motion costs payable only by the Seed Hawk Defendants. However, I am not convinced that the trial judge considered the relationship between the personal defendants and the Simplot Defendant so remote as to shield the latter from these costs. As above, I conclude that the Simplot Defendant must share some burden for costs, to be subsumed in my decision as to set-off.
[287] I agree with the Plaintiffs that the Defendants cannot claim for time during the 2nd Trial Portion in 2001 for which the Plaintiffs were given costs, ie. the item 5 and 6 motion costs. It is not a simple task to segregate these costs because the motion spanned two sitting days. I do not think that October 15 needs an adjustment, nor do I think that item 13(b) preparation for trial on October 16 needs an adjustment. As the Plaintiffs have claimed three hours attendance under item 6, and I am not clear from my reading of the record that the item 14 claim by the Defendants factored out these three hours, I have simply done so for item 14 for October 16, 2001, in each of the respective bills of costs of the Seed Hawk Defendants and the Simplot Defendant.
(iv) Costs as a function of the Reconsideration Decision (March 25, 2004) addressing the Seed Hawk Defendants' motion to reconsider the judgment
Assessment
[288] The Plaintiffs claim (under Column III) 7 units and 3 units per hour (available ranges 3 - 7 and 1 - 3 respectively) for items 5 and 6 respectively (preparation for and attendance of two hours on March 10, 2004) and certain disbursements. The Court dismissed this motion with costs to the Plaintiffs at the high end of Column III. The only issue relative to the counsel fees was the number of hours claimed for attendance. The Seed Hawk Defendants argued that the record discloses exactly 1.5 hours instead of the two hours claimed. The Plaintiffs noted that counsel were present at 0930 hours, the scheduled start time, but for whatever reason, the motion was called 20 minutes later and therefore the claim of two hours is appropriate. I agree with the Plaintiffs. I have consistently held in the past that an appearance at a hearing necessarily includes some time in the courtroom identifying oneself with the Court Registrar and waiting for the call of the case, none of which is preparation time addressed by other items. Therefore, the abstract of hearing (which generally does not reflect lunch breaks or brief recesses) is a useful, but not absolute, guide for assessing attendance at hearings particularly relative to short breaks. I allow the two hours claimed.
[289] The motion record of the Seed Hawk Defendants before the Court in March 2004 contained the supporting affidavit of Taryn Burnett sworn February 2, 2004. The body of her affidavit reproduced specific passages of the trial transcript and referred broadly to others. The responding affidavit of Edward Hermann sworn March 2, 2004, indicated that his review of the trial transcript disagreed with that of Mr. Burnett. He did not append as exhibits any excerpts. As part of his submissions on costs thrown away, counsel for the Seed Hawk Defendants arrived at a figure of $1,802.27 + GST, as the disbursement total for this motion, by removing $160.50 for transcript (which would hardly pay for 36 days of transcript) from the claimed amount of $1,962.77 (before taxes) Although the evidence is essentially non-existent on the point, and the Plaintiffs could have ordered a complete transcript for the 4th Trial Portion in 2003 by that time, I could conceive of the use for certain excerpts in the circumstances of this motion. I add $80.00 to $1,802.27 for a subtotal of $1,882.27, which with $131.76 GST added, results in an allowable disbursement total of $2,014.03.
[290] Consistent with their submissions above, the Seed Hawk Defendants argued that the Simplot Defendant would have benefited from success on the motion and therefore should share equally in the burden of these costs. The March 25, 2004 decision refers throughout to "the defendants" without distinguishing between them. The Simplot Defendant noted that it did not bring nor join in the motion and appeared on a watching brief only. Therefore, although the Court did not specifically tailor references in its decision to "the defendants" as restricted to the Seed Hawk Defendants, the order for costs cannot be read wider than as against only those Defendants, ie. the Seed Hawk Defendants, who brought the motion, meaning that the Simplot Defendant as a non-participating party is not liable for these costs.
[291] I read the relevant motion records. Generally, I have been urged in the various circumstances here to not consider things in a vacuum, but to view them in the larger context of the several events along the continuum of this litigation. An exception might be the Plaintiffs' urged view of the impact of the counterclaim for invalidity. I agree generally with the Simplot Defendant that an order cannot or should not be given a wider reading than as for or against the participating parties, ie. if the Seed Hawk Defendants, perhaps not by name in the particular phrasing of the order, had been found in contempt for some aspect of their conduct completely divorced from any mode of conduct by the Simplot Defendant. At times in these assessments of costs, I was urged to view the Simplot Defendant, if not metaphorically having its hand on the tiller of the Seed Hawk Defendants' defence, as having the status to be consulted, make suggestions and monitor or otherwise influence its development. I doubt that it would have had a vote or equal say in decisions taken. I simply think that it is difficult in the circumstances here to view most events in a vacuum: the Simplot Defendant must share in the burden. Again, apportionment is subsumed as part of the result below on set-off.
Three bills of costs for the assessment of costs: one for each of the Plaintiffs, the Seed Hawk Defendants and the Simplot Defendant respectively
Assessment
[292] Towards the end of the eighth day of hearing before me, there was a possibility that we could finish without having to return for a ninth day. Mr. Riedel had already filed evidence supporting a proposed bill of costs for the assessment of costs. There ensued a discussion before me on a practical approach to sort out respective allowances. I was invited to venture an opinion. I noted that assessment officers should keep in mind that the Federal Court is a national court with practitioners appearing from a number of jurisdictions with perhaps varying procedures and practices concerning costs, such as recent changes in Ontario. Item 26 (counsel fees for the assessment of costs) has been held to be a global amount encompassing both preparation for and appearance on the assessment of costs. In the particular circumstances here, it will not result in a generous or even adequate allowance. My decision on venue, supra, considered costs implications for separate hearings of assessments of discrete bills of costs versus a single hearing, including the possibility that the Plaintiffs might argue, as a function of Rule 408(3), for its costs of assessment to include travel costs, and that the parties might argue some basis for apportionment considerations relative to the various travel costs, albeit opinion may differ as to degree, given that a single hearing might benefit all involved.
[293] Mr. Riedel, who would have incurred travel costs regardless of the venue chosen, and Mr. Giles came to Calgary. The intent was to address the five bills of costs, including one from the Plaintiffs, on the table at that time. We did not even complete the assessment of the first bill of costs of the Seed Hawk Defendants in five days of hearing. There were however elements of submissions led then that did apply later to other bills of costs. That contributed somewhat in the more efficient hearing of subsequent bills, including that of the Plaintiffs. Mr. Horne for the Seed Hawk Defendants graciously agreed to come to Winnipeg (from Calgary) for the final three days of the hearing before me. The Plaintiffs' bill of costs was essentially addressed on the eighth day. Mr. Giles noted the benefit to all in the blended approach taken for these several bills of costs. As well, he noted that only a single item 26 should be allowed for each group of litigants. Mr. Horne expressed concerns about fairness of the distribution of costs of the assessment given that the amounts in issue relative to the Defendants were considerably higher than those relative to the Plaintiffs. Mr. Horne quite sensibly noted, echoed in varying manners by the other counsel, that there was a possible factor here of diminishing returns, ie. whether it might take several more hours (a ninth day) and costs greater than the value of the subject items to prove them. They agreed to write out updated bills of costs (addressing the assessment of costs process) on the spot before me, on the understanding that said claims could be revised if, upon return to their respective offices, an overlooked item was discovered: that did not occur. The matter of apportionment was left to me.
[294] The evidence, particularly from the Plaintiffs and the Seed Hawk Defendants, was understandably scanty. I think that, faced with a claimed amount supported by an invoice versus the identical amount unsupported by an invoice, an assessment officer should not simply discount the latter out of hand because surely assessment officers must be able, at times, to recognize amounts on their face as reasonably necessary, ie. discovery transcript apart from the issue of the number of copies ordered. I do not intend to take up much space analyzing these three bills of costs as I doubt that I could add much of consequence to the succinct observation in para. 86 of Mr. Riedel's written submissions dated June 27, 2005, to the effect that the assessment addressed several bills of costs, including preparation of material, covering 13 years of litigation, seven weeks of trial spanning three years, a separate hearing on venue for the assessments, and six to six and one-half hours of sitting on each day of the assessment.
[295] The Seed Hawk Defendants' further revised bill of costs for the action listed item 26, but instead of a claimed amount, it indicates that it should be allowed in my discretion, no doubt as a function of Rule 408(3) permitting me to "assess and allow, or refuse to allow, the costs of an assessment to either party." Their handwritten bill of costs then claims the maximum Column V amount for item 26. I allow the appropriate and maximum Column IV permitted by the Costs Decision. Item 26 is also claimed for the hearing giving rise to the Costs Decision (providing for lump sum fees of $7,500.00 plus disbursements). The jurisprudence holds that, with certain exceptions, there should be a single assessment of costs for a given case, including interlocutory events, meaning that a litigant is limited to a single claim for item 26. Given my experience, I am certain that the item 26 amount did not come at all close to addressing the preparation of the materials for the assessment of costs, much less the hourly billings to the clients for attendance each day. The Costs Decision specifically provided that I shall dispose of the costs of the assessment in my discretion in accordance with Rule 408(3). Absent the reference to Rule 408(3), I might have had some flexibility, but said reference simply affirmed, I think, the existing jurisdiction in Rule 408(3). I am bound, for reasons similar to those for item 24 above, from usurping the Rule 400(1) discretion of the Court by allowing something beyond the parameters of Rule 407. The Costs Decision did contain the otherwise provision contemplated by Rule 407, but I do not think it permits me to assess an additional item 26, or give maximum Column V fees. The disbursements consisted of $1,479.20 (travel to Winnipeg) and $2,742.00 (photocopies, facsimiles and Quicklaw). Several of the charges do not include GST or PST. The Seed Hawk Defendants' bill of costs for the assessment of costs, presented at $5,761.20, is assessed and allowed at $5,045.10 (consisting of $770.00 for fees, $53.90 GST on fees, $1,479.20 for travel and $2,742.00 for photocopies etc.). This is a somewhat rough and ready exercise: the amount of $5,045.10 is to be considered as inclusive of all taxes.
[296] The Simplot Defendant's handwitten bill of costs claimed maximum Column V item 26 fees twice. Consistent with my approach above, I allow only a single maximum Column IV allowance. The disbursements consisted of $991.31 (photocopies, binding, tabs, courier and Quicklaw), $2,714.52 (travel to Calgary) and $993.50 (travel to Winnipeg). Again, there is a mix of GST included and non-GST amounts. Generally, I find everything in order. However, two items for the Calgary trip require comment: $1,844.21 for five or six nights accommodation and $280.70 for a rental car. The evidence is that the hotel charge included parking, internet and breakfast. There is a separate meal claim for $290.00. The hotel charges amount to about $300.00 or $350.00 per day depending on whether I assume that he spent five or six nights in the hotel. That seems high. The daily parking and rental car charges might have been partly offset by alternative ground transportation, ie. taxis. There still would have been taxis to and from the Calgary airport. I allow a reduced living expense (hotel, ground transportation, meals and incidentals) of $1,800.00 which, when added to his airfare of $299.61, gives an approved total of $2,099.61 for the Calgary trip. Added to $770.00 (counsel fees), $53.90 (GST on fees), $999.29 (photocopies etc.) and $993.50 (Winnipeg trip), the Simplot Defendant's bill of costs, presented at $6,907.33, is assessed and allowed at $4,916.30. Again, this is a rough and ready solution: the approved amount is to be considered inclusive of all taxes.
[297] Rule 408(3) give me fairly broad discretion. However, I doubt that it would support an allowance, in the situation of a single Plaintiff and a single Defendant, of costs of the assessment to both sides, effectively leaving each party to bear its own costs. That scenario is far removed from the circumstances before me. I initially directed that all bills would be dealt with in Calgary. Mr. Giles travelled on that basis because that is where his client's bill was to be assessed. Not surprisingly, given the history of this litigation and notwithstanding excellent efforts by counsel, we did not finish. Mr. Giles was successful to a limited extent in reducing the Defendants' respective claims. He was not successful on the key portion of his clients' claims, ie. costs thrown away. I think that Mr. Giles would have properly apprised Mr. Halford of potential difficulties with the Plaintiffs' proposed position on costs thrown away. Mr. Halford, having weighed such legal advice, would not likely second guess himself in urging his counsel to press ahead. Although I did not have any particular difficulty in arriving at my decision on the issues of costs thrown away, I accept that the Plaintiffs' position concerning the Costs Thrown Away Decision was not patently unreasonable. I will allow assessed costs, including a travel component, to the Plaintiffs. Rule 408(3) in these circumstances leaves me little flexibility to address Mr. Horne's concern for the difference in the size of the amounts in issue.
[298] The Plaintiffs claim the maximum Column V value for item 26 as well. As I noted above, the trial judge's direction that I could dispose of costs was simply an affirmation of my existing authority under Rule 408(3). I allowed assessed costs above to the Plaintiffs within the parameters of three different directions, ie. Column III, high end Column III and low end Column IV. The maximum available value from their respective ranges within said parameters is 6 units. In the circumstances, I allow the high end Column III value which is 6 units ($660.00) plus $46.20 GST. The claimed disbursement total of an estimated $2,325.00, including travel costs and photocopying etc., was comparable to the other two bills. I note that the hotel rate approximates those for the Defendants and is allowed as presented. The balance ($570.00) would include costs associated with the unsuccessful claim for costs thrown away. Generally, that would warrant a significant reduction, but given the circumstances canvassed above for costs thrown away, I remove only $150.00. The Plaintiffs' bill of costs, presented at $3,425.00, is allowed at $2,881.20. As above, that allowed amount includes any taxes.
Interest
[299] The parties, by their counsel, noted that the record sets out the provision for interest on costs and the parameters for calculation. The Costs Decision, at paras. [58] to [60] inclusive, ruled against pre-judgment interest on costs. At paragraphs [61] and [62], the Court ruled that, in accordance with the jurisprudence and practice in the court, judgment interest on costs would run from the date of judgment, ie. January 23, 2004, and not from the date of assessment of said costs. The trial judge ruled that the judgment interest rate in Saskatchewan would apply. The record before me discloses that the current applicable rate of judgment interest in Saskatchewan is 5% per annum pursuant to the Executions Act, R.S.S. 1978, c. E-12, s. 30, which is to run from January 23, 2004 on the allowed costs for the respective parties. The Costs Decision, as is generally the practice, did not require that interest on costs incurred for events subsequent to judgment run from a later date.
Set-Off
[300] This issue was, as I understand it, not particularly contentious. Time ran short on the last day of hearing before me and set-off was essentially left to me to sort out. The Seed Hawk Defendants did lead brief written submissions noting that Rule 408(2) gives me jurisdiction and arguing that any costs assessed for the Plaintiffs be set-off equally against the Seed Hawk Defendants and the Simplot Defendant (one-half each). I do not need to add anything further to my analysis of set-off in Wilson v. Canada, supra, reversed on an issue of interest on costs, but otherwise affirmed in Wilson v. Canada, [2000] F.C.J. No. 1783 (F.C.T.D.). I think that my discretion in this area is quite broad.
[301] If, as a hypothetical exercise, I accept the Seed Hawk Defendants' suggestion of an equal burden of set-off relative to the Plaintiffs' costs, the underlying premise surely is that the challenges facing the Seed Hawk Defendants and the Simplot Defendant, if not identical, were essentially the same in mode and difficulty. I do not intend to diminish the role of the Simplot Defendant in this litigation, but I think that challenges facing the Seed Hawk Defendants were generally or somewhat more extensive. All of this suggests to me a ratio of set-off to subsume apportionment of something other than 1:1.
[302] An order dated March 2, 2005 awarded lump sum costs of $200.00 to the Seed Hawk Defendants, which they asked be included in their assessed total for costs. Strictly speaking, and this comment applies equally to the $7,500.00 lump sum fees awarded in the Costs Decision, it is not necessary to include such lump sum awards in bills of costs advanced for assessment because such awards are already capable of being enforced for collection absent a certificate of assessment. However, their inclusion in the bills of costs surely simplifies matters of set-off and collection. It was convenient here to leave them in the bills of costs as assessed.
[303] The total of the allowed amounts of the three assessed bills of costs (the $200.00 lump sum award above was put in the Further Revised bill of costs) of the Seed Hawk Defendants is $544,327.10 plus interest as above. The total of the allowed amounts of the three assessed bills of costs of the Simplot Defendant is $258,292.03 plus interest as above. The ratio of these two totals respectively is about 2:1. The total of the allowed amounts of the two assessed bills of costs of the Plaintiffs is $8,591.01 plus interest as above. The ratio of 2:1 might be a possibility for the apportionment of set-off. There were differing amounts of interlocutory activities, ie. discoveries. The trial preparation fees are the same. The trial attendances would be the same, but for the factor of second counsel increasing the fee total for the Seed Hawk Defendants. As above, I think that the demands on the Seed Hawk Defendants were different and more extensive and therefore its disbursement totals were significantly higher than those for the Simplot Defendant.
[304] An apportionment in the range of 70%-30% to 60%-40% might seem in order. One approach might be that the Seed Hawk Defendants, in the alpha defence position so to speak, should bear the greater burden of set-off. However, upon reflection, it seems more consistent with the notion of the Simplot Defendant as benefiting from the lead defence of the Seed Hawk Defendants, coupled with the obviously higher amount of costs required for said defence, that the apportionment should favour the Seed Hawk Defendants, ie. to give them an indemnity greater than that resulting from a 1:1 apportionment. The rationale is that, although the risk for (not amount of) adverse damages might have been comparable as between the Seed Hawk Defendants and the Simplot Defendant, the Seed Hawk Defendants should be favoured in any apportionment because of the greater costs associated with successful discharge of their onus of defence which could never be anything other than of direct benefit to the Simplot Defendant. In other words, the Seed Hawk Defendants' costs should be set off less than those of the Simplot Defendant relative to the Plaintiffs' costs.
[305] The problem with this result, if weighed against the circumstances above, for example, in my rationale that the Simplot Defendant should share in the burden of costs flowing from the Reconsideration Decision, is that it has an inconsistency. That is, the sense of my rationale there, I think, was that the Simplot Defendant, if not an active participant, was still liable in a subordinate sense because of the potential for benefit from the Seed Hawk Defendants' work. Yet, my rationale now on set-off flips that notion on its head and vaults the Simplot Defendant into a primary role for the burden of set-off. Again, there is some imprecision in deciding apportionment, if not set-off. The amount to be set off is not large, but that should not be determinative. I think that I will simply fall back on the Seed Hawk Defendants' original suggestion of 1:1 apportionment. The amount of $8,591.01 divided in half equals $4,295.505 (I apportion $4,295.50 and $4,295.51 to the Seed Hawk Defendants and the Simplot Defendant respectively). The amount of $4,295.51, set off against the Simplot Defendant's assessed total of $258,292.03, gives a net amount of $253,996.52 plus interest, which the Simplot Defendant shall recover from the Plaintiffs. The amount of $4,295.50, set off against the Seed Hawk Defendants' assessed total of $544,327.10, gives a net amount of $540,031.60 plus interest, which the Seed Hawk Defendants shall recover from the Plaintiffs. In performing these calculations, I used the amounts exclusive of post-judgment interest because the same judgment date and rate of interest applied to all amounts.
[306] A single Certificate of Assessment shall issue as follows:
I HEREBY CERTIFY that the three bills of costs of the Defendants, Seed Hawk Inc., Pat Beaujot, Norbert Beaujot and Brian Kent (hereafter the "Seed Hawk Defendants"), are assessed and allowed respectively at $528,506.62, $10,775.38 and $5,045.10 for a total assessed amount of $544,327.10.
I HEREBY CERTIFY that the three bills of costs of the Defendant, Simplot Canada Limited (hereafter the "Simplot Defendant"), are assessed and allowed respectively at $244,042.25, $9,333.48 and $4,916.30 for a total assessed amount of $258,292.03.
I HEREBY CERTIFY that the two bills of costs of the Plaintiffs are assessed and allowed respectively at $5,709.81 and $2,881.20 for a total assessed amount of $8,591.01.
SET-OFF
I HEREBY FURTHER CERTIFY that $4,295.50 (from the Plaintiffs' assessed total above of $8,591.01) is set off against the assessed total above of $544,327.10 for the Seed Hawk Defendants giving a net amount of $540,031.60 which the Seed Hawk Defendants shall recover from the Plaintiffs, plus interest at 5% per annum from January 23, 2004, pursuant to the Saskatchewan Executions Act, R.S.C. 1978, c. E-12, s. 30.
I HEREBY FURTHER CERTIFY that $4,295.51 (from the Plaintiffs' assessed total above of $8,591.01) is set off against the assessed total above of $258,292.03 for the Simplot Defendant giving a net amount of $253,996.52 which the Simplot Defendant shall recover from the Plaintiffs, plus interest at 5% per annum from January 23, 2004, pursuant to the Saskatchewan Executions Act, R.S.c. 1978, c. E-12, s. 30.
"Charles E. Stinson"
Assessment Officer
FEDERAL COURT
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-2406-93
STYLE OF CAUSE: JAMES W. HALFORD et al.
- and -
SEED HAWK INC. et al.
PLACE OF HEARING: Calgary, AB and Winnipeg, MB
DATES OF HEARING: May 2 to 6, 2005 incl. and
June 27 to 29, 2005 incl.
REASONS FOR ASSESSMENT OF COSTS: CHARLES E. STINSON
DATED: March 31, 2006
APPEARANCES:
Dean G. Giles for Plaintiffs
Edward M. Hermann
D. Doak Horne for Defendants
Taryn C. Burnett Seed Hawk Inc. et al.
W.W. Riedel, Q.C. for Defendant
Simplot Canada Limited
SOLICITORS OF RECORD:
Fillmore & Riley LLP for Plaintiff
Winnipeg, MB
Gowling Lafleur Henderson LLP for Defendants
Calgary, AB Seed Hawk Inc. et al.
Meighen, Haddad & Co. for Defendant
Brandon, MB Simplot Canada Limited