This was a Costs Decision resulting from an earlier Application and Cross-Application related to a multi-residential property in Memphis, Tennessee.

In their Application, the Plaintiffs advanced claims relating to the property and requested an Attachment Order against one of the Defendants. In response, the Defendants filed a Cross-Application challenging the Plaintiffs’ standing, seeking dismissal of the Application, and requesting release of funds held in Court pursuant to an interim Attachment Order. Justice Marion heard both matters together, and struck several claims for lack of standing, dismissed the Attachment Order, and directed that the funds held in Court be released to counsel for the Defendants. As the Defendants were substantially successful, they sought Costs under Rules 10.2 and 10.33.

Applying the factors set out in Rule 10.33, Marion J. considered the result obtained, the importance and complexity of the issues, and the parties’ conduct. The Defendants achieved substantial success on both the standing and Attachment Order issues. The Court found that the Plaintiffs’ decision to commence proceedings in Alberta without proper Delaware limited partnership authorizations unnecessarily complicated and lengthened the matter. Although both parties contributed to some inefficiencies, the Plaintiffs’ procedural missteps primarily increased costs and added confusion.

Justice Marion found the Application and Cross-Application to be legally and factually complex, engaging cross-border corporate and accounting issues. While noting that the Defendants’ record-keeping was imperfect, Marion J. determined that their success on the principal issues justified a Costs award in their favour. In assessing quantum, the Court considered the reasonableness and proportionality requirements under Rule 10.2 alongside the factors in Rule 10.33.

Marion J. determined that Column 3 of Schedule C was the appropriate reference point, applying a 3X multiplier to reflect the complexity of several substantive issues, and a 25% inflationary adjustment consistent with recent authorities that account for inflation since the 2020 Schedule C amendment. Justice Marion noted that although costs typically fall within 40-50% of actual solicitor-client costs, that approach would yield a disproportionate result in this case.

After balancing the relevant factors, Justice Marion awarded the Defendants a lump-sum of $40,000, plus disbursements and GST.