HILL v HILL, 2013 ABCA 389


14.1: Definitions
Rule 518: Powers of Court
Rule 809: Fees

Case Summary

This Appeal arose out of a complex and highly contentious claim by a son who had not been given an interest in his father’s business. The Action failed at Trial and an Appeal on the merits was dismissed. The Court of Appeal also previously decided an Appeal of Costs ordered at the Court of Queen’s Bench level. This Appeal was with respect to Costs of the main Appeal. Counsel were unable to agree on a number of aspects of Court of Appeal Costs and asked the Court to settle such questions. The Respondents had provided the Appellant with a joint Offer to Settle both Appeals. The Offer was made after the Appellant had filed his materials in the main Appeal, but early in the parallel Appeal with respect to Costs at the Court of Queen’s Bench. The Offer was rejected, and both Appeals were unsuccessful.

The Appellant made a number of arguments with respect to Appeal Costs. The Appellant argued that the Offer to Settle should be ignored because the Respondents thought that the Appeal had little chance of success. The Court held that such an argument was illogical, and could effectively nullify any Rules respecting the Costs consequences of an Offer to Settle. The Appellant further argued that because his suit was for a large sum of money, no Offer to Settle would have been attractive. The Court rejected this argument on the basis that such reasoning would exempt any lawsuit claiming a large sum from the Rules with respect to Formal Offers. The Appellant further argued that the Offer should not have an effect on Costs in the main Appeal because the Offer was with respect to both parallel Appeals. However, the Court held that there was no reason to forbid comprehensive Offers. That the Appellant decided to appeal merits and Costs separately should not reduce the Respondents’ ability to make a comprehensive Offer.

The Rules with respect to Offers to Settle compare the result after the fact with the result which the Offer would have given. The exception to this approach is an Offer by which the offeror would concede nothing if it were accepted. Such offers will be ignored in the context of Costs. The exception also applies to Offers of only a tiny or nominal concession, on the basis that such Offers do not include a genuine offer of compromise.

The Offer made by the Respondents would have given a credit of $100,000.00 toward the Appellant’s Trial Costs, which far exceeded that amount. The Offer would also have forgiven any Costs related to the Appeals. The Offer was open for acceptance for 45 days, pursuant to the former Rules. The Offer also provided that the Appellant would have had his Appeal Costs to the date of service of the Offer, which would have included most of his Costs of the main Appeal. In total, the Offer would have yielded approximately $256,000.00 in cash and setoffs. The Court held that the Offer was genuine and significant. In this context, the Court rejected the Appellant’s argument that the Offer did not represent a real concession by the Respondents.

Former Rule 174(1.1) provided that an offeror would receive double fees from the date of service of the Offer if he or she won the suit or Appeal, and the Offer was not accepted. Rule 518.1 applies that Rule to Appeals. As such, the Court held that the Court of Appeal Costs should be doubled from the date of service of the Offer.

The Appellant further argued that, before considering the Offer to Settle, Costs should be calculated on Column 5 of Schedule “C” with no multiple. The Court held that Rule 608 suggests Court of Appeal Costs on the same scale as Court of Queen’s Bench Costs, which was the usual practice of the Court of Appeal. It had been determined that a multiple of four times Column 5 was appropriate in the present matter, and that no good reason was provided to depart from the practice and presumption reflected in Rule 608.

The Court held that the Appellant’s previous argument on Appeal suggested that the main Appeal was straight forward and that most of the work had already been done in the Court of Queen’s Bench. The Court previously rejected that argument, and held that the Appellant’s Factum on Appeal “was not always a reliable guide to the facts or the issues”. The Court held that, without the Respondents’ materials, the Court’s task in determining the Appeal would have been enormous. The Court further held that, on Appeal, the Appellant continued to be a moving target and raised new points on which the Trial Judge’s views were not available. In this context, the Court held that the Respondents were required to do an unusual amount of work on Appeal and should be compensated. The Court held that punishment of the Appellant was a smaller, but relevant, factor.

The Appellant further argued that, if the Respondents thought any allegations in the Appellant’s argument on Appeal were groundless, the Respondents could have simply ignored them. The Court rejected that argument, and held that Appeals do not work in that way. Further, the Respondents could not have known that such arguments were groundless without checking thoroughly.

The Appellant further objected to paying two sets of Costs, one to the individual Respondents and one to the Corporate Respondents. The Court held that it rejected the same objection in its previous Reasons. The Court further held that a second counsel fee was appropriate, given the complexity and volume of material. In this context, the Court held that Costs of the main Appeal would be calculated at four times Column 5 up to the date of service of the Offer, and eight times Column 5 after the date of the Offer.

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