10.29: General rule for payment of litigation costs

Case Summary

The issue before the Court was whether witnesses who were non-parties could be held responsible for Costs arising from certain Applications they pursued. Justice Graesser answered in the affirmative.

Previously, several prospective witnesses for the Defendant applied before Graesser J. to cancel or postpone scheduled Questioning on the basis that it was premature for them to be questioned in the lawsuit. The witnesses had filed their own Application and submitted their own Brief. The Defendant, their former employer, took no position on the witnesses’ Application. Justice Graesser dismissed the witnesses’ Application and directed that Questioning proceed. However, his Decision was silent on Costs.

The Plaintiffs argued that because they were successful on the Application, they were entitled to Costs under Rule 10.29(1), which holds that a successful Party to an Application is entitled to Costs from the unsuccessful Party. The Defendant submitted that witnesses neither pay nor receive Costs when they are involved in other people’s litigation.

Justice Graesser found that the Rules dealing with Costs apply only to Parties. Witnesses are not affected by the Costs Rules, as they are entitled “to receive conduct money, witness fees, and reimbursement for reasonable costs of their attendance for travel, accommodation, and meals”.

However, the Rules do not expressly make a non-party witness liable for Costs, the common law does.

Justice Graesser referred to Thomas J.’s decision in Shefsky v California Gold Mining Inc, 2015 ABQB 525 (“Shefsky”), a case that discussed the Court’s jurisdiction to award Costs against a non-party in three scenarios: (a) where the non-party was the person ultimately liable; (b) where the non-party was the real instigator of the litigation and the one which would have received the fruits; and (c) where the non-party was guilty of serious misconduct in relation to the lawsuit.

Justice Graesser held that the scenarios outlined in Shefsky were not exhaustive and that Costs are always in the Courts’ discretion. He found that there was no reason why the non-party witnesses should be exempt from paying Costs after being unsuccessful on their Application. When witnesses involve themselves in the litigation, file their own Applications and submit their own Brief, they are generally pursuing their own interests and not the litigants’, thus increasing the actual Parties’ Cos

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