Key Points:
- The plaintiffs' action was dismissed in a previous ruling (Lee v. Chang, 2024 ONSC 580) for breach of contract, unjust enrichment, fraud, and fraudulent misrepresentation.
- The defendants sought costs after their success, claiming partial indemnity costs up to their offer to settle in August 2019, and substantial indemnity costs thereafter, totaling $250,465.97.
- The plaintiffs argued against the costs, citing divided success and their financial difficulties.
Court’s Analysis:
- Success Not Divided: The court rejected the plaintiffs' argument that success was divided. The defendants did not counterclaim, and the plaintiffs’ claims were entirely dismissed.
- Scale of Costs: The defendants were awarded costs on a partial indemnity scale, rather than a substantial indemnity, due to lack of bad faith conduct by the plaintiffs.
- Impecuniosity Argument: The plaintiffs’ claim of being unable to pay costs due to financial hardship was not upheld as they did not provide sufficient evidence.
- Quantum of Costs Awarded: The court awarded the defendants $147,897.55 in costs, plus HST of $19,226.68, and disbursements of $10,000, totaling $177,123.68.
Conclusion: The court found that the plaintiffs were responsible for the defendants' costs following the dismissal of their action, with no basis to depart from the standard rule that a successful party is entitled to costs. The argument of financial hardship was not persuasive without solid evidence.
