macleod j

10.29: General rule for payment of litigation costs
10.31: Court-ordered costs award
10.33: Court considerations in making costs award

Case Summary

The Plaintiff, Clarke, was unsuccessful in a wrongful dismissal Action against the Defendant Syncrude. Although, the Defendant proved just cause for the Plaintiff’s termination, the Plaintiff obtained a Judgment against the Defendant in respect of his stock options where were found to have been undervalued. On this basis, and on the basis of alleged misconduct of the Defendant throughout the course of litigation, the Plaintiff applied for Costs.

Justice Macleod noted that the Court has wide discretion in ordering Costs, particularly under Rules 10.29, 10.31 and 10.33 provides that a successful party is entitled to a Costs award against an unsuccessful party. This general rule applies where a party is substantially, if not totally, successful in a proceeding. Likewise, a plaintiff who succeeds in an action but recovers only a portion of the amount claimed will usually be considered successful and thus entitled to Costs. The Court may consider the amount claimed and the amount recovered in making a ruling on Costs under (b). The Rules expressly state that the Court may consider the results of the Action and the degree of success of each party, as well as the apportionment of liability: Rule 10.33(1)(a) and 10.33(1)(e).

While the Plaintiff was successful in obtaining a significant Judgment against the Defendant, he was not substantially successful in the Action when viewed as a whole. The most significant issue in the Trial was just cause and the Plaintiff was not successful on that point. In discussing the relevant legal principles, Justice Macleod set out the various factors which the Court may consider in deciding whether to impose, deny or vary an amount in a Costs award. This Rule and the cases make it clear that the conduct of a party in a proceeding may affect the Court’s discretion to award Costs. If a successful party has engaged in misconduct, the Court may deny Costs or require the party to pay the Costs of an unsuccessful party. Macleod J. was not satisfied that the Plaintiff’s case fell within the rare and exceptional circumstances that would justify an award of solicitor-client Costs. However, Macleod J. was concerned about the pattern of late production of clearly relevant documents by the Defendant. Justice Macleod found this an appropriate case to apportion Costs and directed that each party calculate its Costs of the litigation in accordance with Column 4 of Schedule C of the Rules, including taxable disbursements. The Defendant would be entitled to recover two-thirds of its amount against the Plaintiff, and the Plaintiff would be entitled to recover one-third of its amount against the Defendant. The two amounts would be set-off against each other and the Defendant would have Judgment against the Plaintiff for the balance.

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