This Decision dealt with Costs from an underlying Application. The Applicant, Thomas Garbera, applied for the administration of the Estate of his late father, Walter. Walter’s will named his sons, Thomas and Ethan, as beneficiaries, while Joyce Oman was appointed as Personal Representative and Trustee. Walter also had two joint bank accounts with his sister, Helen Klammer. At the time of the Application, the Estate was valued at about $533,000, excluding joint accounts.

In the Application, Thomas asked the Court to: (i) remove Joyce as Personal Representative and Trustee and appoint someone else; (ii) determine if Joyce’s expenses were proper Estate expenses; (iii) decide if Joyce should be paid for work done on behalf of the Estate; and (iv) clarify if the joint accounts were part of the Estate.

In his decision reported at 2024 ABKB 185, Justice Renke: (i) dismissed the application to remove Joyce as Personal Representative and Trustee; (ii) set Joyce’s compensation as Personal Representative at $1,500, as of January 31, 2023; (iii) declared that Helen held the beneficial interest to one of the  joint accounts; and (iv) declared that Helen held the funds in the other joint account  in trust for the Estate, and ordered Helen to pay $77,596.60 to the Estate.

The parties could not agree on the Costs quantum regarding: (i) Thomas’ costs against Helen; (ii) Joyce's costs against Thomas; and (iii) indemnification for Joyce's legal expenses.

Justice Renke began by noting that the “key rules” for costs awards are found in Rules 10.29, 10.31, and 10.33. He then canvassed the case law guiding cost determinations.

The overarching principle is proportionality, which “can be understood to lie between (typically) the reasonable legal fees that should have been charged for the litigation steps and the percentage or portion of those reasonable fees payable by the unsuccessful party, taking into consideration the r 10.33 factors”. The Rules do not provide a particular method of measuring proportional costs.

Several methods—including examining the successful party’s actual costs, percentage indemnity of solicitor-client costs, assessed costs, reasonable solicitor-client costs, or Schedule—may serve as the basis for setting proportionate costs. However, solicitor-client costs, understood as reasonable or proportional solicitor-clients costs (i.e., not necessarily what was actually charged by the successful party’s counsel) may be awarded in “rare and exceptional circumstances” and are “generally reserved for reprehensible, scandalous or outrageous conduct by a party and in rare and exceptional circumstances”.

Justice Renke noted that Thomas was largely successful on his Application against Helen, recovering about 70% of the joint account funds. However, the Application was not complex, requiring only a half-day hearing. The Court rejected Thomas’ claim for solicitor-client Costs due to insufficient justification. Instead, Thomas was awarded Costs against Helen under Column 2 of Schedule C, totalling $10,771.97.

Joyce was awarded double Column 1 Costs from the Estate, totalling $16,100. This higher award was justified by the complexity and volume of her work, including handling beneficiaries, Estate accounting, and personal property distribution. The Court also noted that Joyce made a reasonable settlement offer that Thomas rejected.

For indemnification of Joyce's legal expenses, Renke J. found that the Estate should not cover her full, but only reasonable solicitor-client Costs, due to errors in the administration of the Estate, (e.g., delayed accounting and investigation of joint accounts, even though this was a good faith error).