bielby, veldhuis and strekaf jJA

4.29: Costs consequences of formal offer to settle
10.31: Court-ordered costs award
14.59: Formal offers to settle
14.88: Cost awards

Case Summary

Both parties sought directions from the Court of Appeal as to how the Costs of the underlying Appeal and the prior proceedings should be addressed. The underlying Appeal arose out of a dispute relating to termination of the business relationship between the Appellants, Genco Place Properties Ltd (“Genco”), and the Respondents, 864503 Alberta Inc (“864”).

Genco submitted that the Costs awarded by the Master were final and sought to have the Court direct that the 3 times multiplier applied by the Master be carried forward to Costs incurred on the Appeals to the Chambers Judge and the Court of Appeal pursuant to Rule 14.88(3). Additionally, Genco sought double Costs from the date of the Formal Offer pursuant to Rule 14.59. 864 objected, arguing that the circumstances fell within Rule 4.29(4)(a) in that the Master awarded a lump sum award pursuant to Rule 10.31(1)(b) and accordingly the double Costs rule should not apply.

The Court of Appeal found that their reinstatement of the Master’s Decision on Appeal was awarded the usual deference afforded to Costs decisions. Accordingly, the Court found that the Costs assessed by the Master were reasonable and they should not be revisited but that it was not appropriate to carry them forward for the entirety of the proceedings pursuant to Rule 14.88(3).

On the issue of double Costs, the Court found that Genco was entitled to double Costs in the Court of Queen’s Bench from the date of the Formal Offer pursuant to Rule 4.29. The Court did not find that the same was true of the proceedings on Appeal. The Court noted that Rule 14.59 contemplates a doubling of Costs relating to an Appeal where “a formal offer to settle the appeal or any part of the appeal” is made. The Court found that no Formal Offer was made in relation to the Appeal itself. Citing Humphreys v Trebilcock, 2017 ABCA 232 (CanLII), the Court found that when no renewal of the Formal Offer is made on Appeal then there is no doubling of Costs under Rule 14.59.

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