The Law of Costs – Mark M. Orkin and Robert G. Shipper
Release #1
What’s New?
Party-to-Party Costs – The Courts of Justice Act – Costs to be Fixed or Assessed – Introduction – In judgments rendered in the Alberta Court of King’s Bench the court awarded damages of $165,166,431 with prejudgment interest to the plaintiff against the defendants. The parties were unable to agree on costs. After adjusting its claim to acknowledge the legitimacy of points made by the defendants, the plaintiff sought costs in the amount of $4,801,339.41. In this case the court reviewed the meaning of “reasonable and proper costs”: Remington Development Corporation v. Canadian Pacific Railway Company, 2023 ABKB 591 (Alta. K.B.)
Party-to-Party Costs – The Courts of Justice Act – Costs to be Fixed or Assessed – The Reasonable Expectations of the Parties – Proportionality – The main focus of the jury trial was whether the defendant was liable to the plaintiff under the Occupier’s Liability Act (Ont.). Of particular significance as it related to this matter was the apportionment of liability against the plaintiff. An award of costs that exceeds the amount of damages assessed by the jury might be seen by some as disproportionate. While an award of costs must be proportionate it must also be seen to be reasonable and fair. It must also reflect an amount that the losing party might reasonably have anticipated paying in the event of non-success at trial: Lawless v. Joanovits, 2024 ONSC 1561 (Ont. S.C.J.)
Party-to-Party Costs – Several Plaintiffs – Class actions – Legal Fees – This appeal in the Court of Appeal for Ontario involved the fees to be paid to class counsel following the settlement of a class action concerning unpaid overtime work. Class counsel was a consortium of three law firms. The motion judge awarded class counsel $25 million in fees for obtaining a $153 million settlement over the course of 15 years. After other deductions, this left $106 million to be allocated to the class. The appellant class counsel was requesting a $19 million increase for a total of $44 million in class counsel fees. This amount reduced the class portion of the settlement to $86 million for 31,000 class members. The appeal was dismissed: Fresco v. Canadian Imperial Bank of Commerce, 2024 ONCA 628 (Ont. C.A.).
Party-to-Party Costs – Dismissal and Discontinuance of Actions – Where Plaintiff Discontinues Action – The province of Ontario issued exploration permits allowing the defendant Q Inc., one of the two companies owned by the defendant prospector M, to conduct mining exploration activities in an area near the plaintiff’s reserve. The plaintiff obtained an interim injunction prohibiting M and two companies from engaging in any exploration activities in the area pending determination of an application for interlocutory relief. The interim injunction was later extended as against the two companies, but not as against M. M who was acting on behalf of himself and the companies claimed costs on a substantial indemnity basis the amount of $115,598.60. The court on that application found that parties would bear their own costs on the motion, given the divided success in the matter. The plaintiff sought a new interlocutor injunction against M and his companies. The judge on that motion denied the plaintiff’s requested adjournment and the plaintiff withdrew its application. M sought costs on a substantial indemnity basis in the amount of $44,383,50 plus disbursements. The judge reviewed the issue of costs when an action has been discontinued as well as costs for a self-represented litigant: Ginoogaming First Nation v. HMTK, 2024 A.C.W.S. 1561 (Ont. S.C.J.).
The Law of Costs – Mark M. Orkin and Robert G. Shipper
Release #3
What’s New?
Party-to-Party Costs – Costs Payable by Solicitor – Conduct of Solicitor – The Ontario Superior Court judge had declared a mistrial. The court was now dealing with whether or not the lawyer for the plaintiff should be held personally liable for costs. The mistrial was declared largely as a result of the non-disclosure of a conflict of interest involving the lawyer for the plaintiff, her husband, her husband’s company, and the retainer by her husband’s company of two doctors who prepared medical legal reports for the lawyer’s law firm. This was one of those rare and exceptional cases where the conduct of the lawyer required the Court to exercise its responsibility to supervise the conduct of a lawyer where the conduct was of such a nature that it both frustrated and interfered with the administration of justice. The mistrial was entirely avoidable. Regrettably, in this case, the judge stated that the lawyer’s actions were a complete misunderstanding of what the word candour means. Candour required disclosure of the conflict to the client, to the defendant of the court. Candour required full disclosure of the inflated cost of the doctor’s invoice to the client, the defendants and to the court. None of this happened. This was the rare case where the court exercised its discretion to award costs of the mistrial against the lawyer. To do otherwise would be to countenance such conduct and to potentially have the client pay the mistrial costs which would be patently unfair to the client where his conduct in no way caused the mistrial. Ashrafian v. Kavarana, 2024 ONSC 240; 2024 A.C.W.S. 2060 (Ont. S.C.J.)
Security for Costs – Appeals – General – This decision from the Ontario Court of Appeal is in respect to an appeal from the decision of the Superior Court of Justice reported at 2024 ONSC 1964. The appellant M, appeals from the decision of the judge of the Superior Court of Justice who granted summary judgement in favour of the respondent B, who was M’s former lawyer. Judgement was granted in the sum of $2,850,500 on account of outstanding legal fees. The respondent B applied to the Ontario Court of Appeal for security for costs and security for judgement against appellant M. As the Court of Appeal noted from earlier appeal decisions, the ordering of security for costs is discretionary; a two-step reasoning process is involved. The first question is whether the requirements pf rile 61.06(1)(a), (b), or (c) are met. If so the second question is whether it would be just to order security, considering the circumstances and the interests of justice. Security for judgement is an “extraordinary remedy”. Trying to get money that rests on reserve comes very close, if not crosses over the line into what the Court of Appeal had earlier said cannot be done by virtue of section 89 of the Indian Act. In total, the appellant M was ordered to pay into court security for costs in the total amount of $115,026.90. Bogue v. Miracle, 2024 ONCA 643 (Ont. C.A.)
Remedies in Tort – Lewis N. Klar et al.
Release #3
What’s New?
In Sickel Estate v. Gordy, 2008 SKCA 100, there was a fatal traffic accident caused by employee of the company contracted to provide food service to carnival. The accident occurred while the employee driving truck owned by one of her employer’s partners in convoy was moving to the next carnival location. Since the accident occurred while the employee was performing her regular employment duties, the employer was held to be vicariously accountable.
In John Doe (G.E.B. #25) v. The Roman Catholic Episcopal Corporation of St. John’s, 2020 NLCA 27, the plaintiffs were victims of abuse while resident at orphanage operated by Christian Brothers. They unsuccessfully tried claiming that the Catholic Church was vicariously liable for non-feasance of orphanage’s parish priest in preventing abuses, but no evidence was established. On appeal, the Court of Appeal upheld the trial judge’s determination respecting the Archdiocese’s vicarious liability for the parish priest’s non-feasance but overturned the trial judge’s determination respecting the Archdiocese’s vicarious liability for the Christian Brother’s sexual abuse of appellants when children in the orphanage supervised by the Christian Brothers.
Conflicts of Interest – Eugene A.G. Cipparone and Ted Tjaden
Release #1
What’s New?
A revised and updated Chapter 20: Motions to Disqualify Counsel for Conflicts of Interest. The updated commentary and case law includes 48 new, recent lawyer disqualification decisions. In addition, Appendix F:22. Model Factum in Support of or in Opposition to a Motion to Disqualify Counsel of Conflicts of Interest.
Manitoba King’s Bench Rules Annotated – Jonathan M. Woolley
Release #1
What’s New?
Year in Review – The Year in Review discusses some of the notable trends and developments in civil litigation in Manitoba from October 2023 to December 31, 2024 with a review of Practice Directions issued by the Court of King’s Bench and Court of Appeal in 2024 and commentary on notable decisions of the Manitoba Courts dealing with various civil procedure issues including: Dismissal for Delay; Costs Awards and Solicitor-Client Privilege.
Manitoba King’s Bench Rules – Rule 19.08 – Default Proceedings-Setting Aside – Generally – The factors generally considered by the Court in a motion to set aside default are: whether the defendant had an ongoing intention to defend; the defendant’s explanation for why defence was not filed; whether the failure to file a defence was willful; whether the motion to set aside was brought with dispatch; and whether there was undue prejudice to the plaintiff. While proof of a meritorious defence is not a pre-condition to set aside the noting of default, it is a relevant factor for the Court to consider in exercising its discretion. Ultimately, the factors into consideration should not be considered in isolation but should be weighed together in the Court’s decision. While recognizing that the circumstances of every case must be analysed, the onus is generally considered to be low when it comes to setting aside default. Schaworski v. Unrau, 2024 MBKB 150, 2024 CarswellMan 334 (man. K.B.), per Patterson Associate J.
Manitoba King’s Bench Rules Annotated – Jonathan M. Woolley
Release #2
What’s New?
Manitoba King’s Bench Rules – Rule 24.01 Dismissal for Delay – Significant Prejudice and Delay – Inordinate and Inexcusable Delay – When assessing delay, the Court must determine whether it has been both inordinate and inexcusable. An assessment of whether or not the delay was inordinate may involve consideration of the nature of the issues in the action, the complexity of the issues, the current status of the litigation as compared to a reasonable comparator and the role of each party in the overall delay. If the delay is found to be inordinate, the onus then shifts to the plaintiff to justify the delay (i.e., a consideration of whether the delay can be excusable). If the delay is found to be both inordinate and inexcusable, there is a rebuttable presumption of significant prejudice. Even if the delay is not inordinate and excusable, the Court may still dismiss a claim in a case where significant prejudice has occurred. In exceptional circumstances, the Court may refuse to dismiss the action even where it finds delay and significant prejudice. Forsythe v. Johnson, 2024 MBCA 104 per Spivak, J.A.
Manitoba King’s Bench Rules – Rule 57.01(2) – Costs – Costs Against Successful Party – The Court’s discretion with respect to costs must be
exercised in accordance with the principle and the rules governing the exercise of all judicial discretion – it is not to be exercised in a harsh or arbitrary manner. However, the discretion is unfettered and untrammeled and will be governed by the special circumstances of the case. For the Court to award costs to an unsuccessful party, that party must persuade the court that the proceeding contained some special element to justify such an order. Examples include cases where the successful party engaged in misconduct (such as failure to make proper
disclosure). However, courts have also granted costs in cases of significant public interest. Polischuk v. The City of Winnipeg, 2024 MBKB 156 per Martin J.
Lawyers & Ethics: Professional Responsibility and Discipline –Gavin MacKenzie
Release #1
What’s New?
WP:131 – Professional Misconduct (B.C.) Professional misconduct…represents a marked departure from proper professional practice, but is not necessarily associated with moral turpitude or with intentional wrongdoing.
Gregory v. The Law Society of British Columbia, 2024 CarswellBC 3060, 2024 BCCA 350 (B.C. C.A.) Groberman J.A. (Fenlon and Fitch JJ.A. concurring) at para. 65
- Model Code of Professional Conduct, as amended April 2024.
- National Discipline Standards, Approved by Council October 14, 2023).
- Model Rule on Client Identification and Verification (Adopted by the Council of the Federation of Law Societies of Canada, March 20, 2008; amended December 12, 2008; amended October 19, 2018; amended March 14, 2023).
- National Requirement (Amended March 12, 2024; in force January 1, 2029).
The Regulation of Professions in Canada – James T. Casey
Release #2
What’s New?
Chapter 3 – The Canadian Charter of Rights and Freedoms – In an important Charter case, the Ontario Divisional Court upheld a tribunal’s decision finding a physician guilty of professional misconduct for spreading Covid-19 misinformation. The Court held that the tribunal had properly balanced the physician’s freedom of expression with the statutory objective of protecting the public: Trozzi v. College of Physicians and Surgeons of Ontario, 2024 ONSC 6096.
Chapter 6 – Compliance with Statutory Provisions – The Saskatchewan Court of Appeal upheld a decision finding that a provision in a bylaw requiring notice of an AGM to be served by mail was directory rather than mandatory. As a result, the service of the notice of the AGM by email did not invalidate the results of the AGM: Haas v. The Saskatchewan Veterinary Medical Association, 2024 SKCA 110.
Chapter 8 – Procedural Rights at a Disciplinary Hearing – The denial of an adjournment was upheld even though there was concurrent civil litigation addressing the same issues. The Court found that the tribunal had properly balanced potential prejudice to the member with the public interest in completing disciplinary proceedings: Bauhuis v. Association of Professional Engineers and Geoscientists of Alberta, 2024 ABKB 603.
Executors and Trustees – Carmen S. Thériault
Release #3
What’s New?
Mutual Wills – Evidence of Agreement – The marriage of the testator and the defendant was a second marriage for both. The defendant and the plaintiff, the deceased’s child from his first marriage, had a difficult relationship. The testator and the defendant had kept their finances separate and had made new wills which made the other the sole beneficiary with gift overs to their respective children in equal shares. After the testator died the defendant made a new will, revoking prior wills, and leaving the residue of her estate to her biological children. The plaintiff brought an action against the defendant to seek variation of the deceased’s will for failure to provide adequate, just and equitable provision for her. She also sought leave to bring an action against the defendant because she changed her will. The plaintiff’s application was dismissed. The court found there was no evidence that the testator and the defendant had intended to bind each other to mutual wills, saying at para. 37:
37 The doctrine of mutual wills requires there to be an agreement between the parties which satisfies the requirements of a binding contract. The agreement must be proven by clear and satisfactory evidence and it must include an agreement not to revoke the wills: Edell v. Sitzer, 55 O.R. (3d) 198 at para.58, 2001 CanLII 27989 (O.N.S.C.); Brynelsen Estate v. Verdeck, 2002 BCCA 187. When two persons agree to make mutual wills, they agree that once the wills are made that no changes may be made by either party, without the other’s consent, and when one person dies, the surviving party cannot change the disposition made in their will. There must be clear and unequivocal evidence of an enforceable agreement between the parties that the survivor cannot change their will after the death of the first person.
43 The decision of Moyer v. Moyer Estate, 2018 BCSC2225, is similar to the circumstances of this case. Justice Crossin sets out the principles of a mutual will agreement: A mutual will agreement imposes an onerous obligation on the surviving testator, who is left unable to deal freely with their property during the remainder of their lifetime and is compelled to dispose of it in a certain way at their death. For this reason, in order for the court to find the existence of an enforceable agreement, there must be clear and unequivocal evidence, including clarity of terms.
Byron v. Cress, 2024 BCSC 1152, 2024 CarswellBC 1913 (B.C. S.C.).
Estate Assets – Pets – Establishing Ownership – An estate trustee applied for a declaration that a dog was owned by the deceased at the time of his death and was therefore an asset of the estate. The dig had been taken by the respondent, who had been in an intermittent relationship with the deceased. In granting the application, the court set out the law relating to pet ownership, saying at para. 24 et seq:
24 Dogs are personal property much like other chattels (albeit indivisible), even when purchased during the course of a relationship. The question is one of ownership, not who wants the dog more, who loves the dog more or who would be the best owner.
25 Traditionally, the question of pet ownership focused narrowly on who paid for the animal. More recent cases have taken a broader approach, looking at the relationship between the parties and the dog and considered an non-exclusive list of factors.
26 The Coates decision [Coates v. Dickson, 2021 ONSC 992, 2021 CarswellOnt 1430] contemplates the following factors:
- Whether the animal was owned or possessed by one of the people before the relationship began;
- Any express or implied agreement as to ownership, made either at the time the animal was acquired or after;
- The nature of the relationship between people contesting ownership at the time the animal was first acquired;
- Who purchases and/or raised the animal;
- Who exercised care and control of the animal;
- Who bore the burden of the care and comfort of the animal;
- Who paid for the expenses related to the animal’s upkeep;
- Whether at any point the animal was gifted by the original owner to the other person;
- What happened to the animal after the relationship between the litigants changed; and
- Any other indicia of ownership or evidence of agreement relevant to who has or should have the ownership of the animal. [footnotes removed]
Carvalho v. Verma, 2024 ONSC 1183, 2024 CarswellOnt 2458 (Ont. S.C.J.), additional reasons 2024 ONSC 3915, 2024 CarswellOnt 10262 (Ont. S.C.J.).
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