Court must be satisfied plaintiff’s action was reasonable under ordinary procedure

Insurance - Actions on Policies - Practice and Procedure

Defendant was ordered to pay plaintiff $58,761.00 on account of covered losses under policy of fidelity insurance. Plaintiff was awarded prejudgment interest on sum owed to it, which would increase plaintiff's recovery to approximately $66,000.00. Plaintiff's claims for damages for breach of duty of good faith and for aggravated and punitive damages were dismissed. Parties made submissions concerning costs, with plaintiff seeking costs on substantial indemnity basis in amount of $330,347.00 or in alternative on partial indemnity basis in amount of $240,563.00. Plaintiff's recoverable partial indemnity fees fixed at $120,000.00 plus HST of $15,600.00, for total of $135,600.00. To that sum would be added disbursements of $61,009.08. Rule 76.13(2) of Rules of Civil Procedure provides that where amount awarded is $100,000.00 or less, exclusive of interest and costs, plaintiff shall not recover any costs unless court is satisfied that it was reasonable for plaintiff to have commenced and continued action under ordinary procedure. It was reasonable for plaintiff to have commenced and continued prosecution of action under ordinary procedure . Plaintiff, as successful party, was entitled to award of costs payable by defendant. Plaintiff's costs should be assessed on partial indemnity basis only.

688857 Ontario Limited v. Aviva Insurance Company of Canada (2019), 2019 CarswellOnt 4941, 2019 ONSC 2034, Stinson J. (Ont. S.C.J.); additional reasons (2018), 2018 CarswellOnt 17007, 2018 ONSC 5891, Stinson J. (Ont. S.C.J.).

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