APPLEBY v SMALLWOOD, 2019 ABQB 114
4.29: Costs consequences of formal offer to settle
10.31: Court-ordered costs award
10.32: Costs in class proceeding
10.33: Court considerations in making costs award
SCHEDULE C: Tariff of Recoverable Fees
The Defendants, as successful parties in the underlying Action, sought enhanced Costs plus double Costs under Rule 4.29 or in the alternative sought Costs as a percentage of solicitor and client Costs. The Plaintiffs disputed double Costs on the basis that the offer made was not genuine and the Defendants did not beat the Formal Offer.
Rule 10.31 permits the Court to order reasonable and proper Costs after considering the factors in Rule 10.33. In addition, Rule 10.32 sets out factors related to the conduct of the parties that the Court may consider. Burns J. found that the Court has a broad discretion but overall the Costs award must be reasonable.
The Court found that the Trial was not long or complex, and that the litigation was efficiently managed. Both parties were well represented and conducted themselves as they should in the litigation.
In reviewing the case law, the Court noted that in some circumstances, Courts may award Costs beyond Schedule C fees. These circumstances included (a) the importance of the outcome for the parties; (b) whether the successful party incurred significant liability to retain legal counsel; (c) exceptional circumstances; (d) whether the successful party needed to defend her reputation or standing; or (e) whether the issues were complex. Based on these factors, the Court held that Schedule C Costs were not sufficient, and awarded enhanced Costs of double Column 1. Furthermore, the Court found that the Costs Schedule is out of date in terms of value and Costs and should be adjusted for inflation. As such, the Court added a 46.60% gross-up applied to reasonable fees in 2018.
Finally, Burns J. found that the Formal Offer was not genuine and was instead a no-risk litigation strategy. On that basis, Burns J. did not award double Costs.View CanLII Details