4.23: Contents of security for costs order
5.27: Continuing duty to disclose
5.31: Use of transcript and answers to written questions
SCHEDULE C: Tariff of Recoverable Fees

Case Summary

Justice Poelman addressed a continuing series of disputes between the parties regarding procedural and evidentiary matters. The current dispute concerned, inter alia, the amount to be posted as Security for Costs and a claim for privilege over solicitor-client communications.

With respect to the Security for Costs Application, the party from whom security was sought consented to the payment into Court. The Court was left to determine the appropriate amount for security, which was contested. The Court looked at several factors in determining what the proper amount should be. One of the issues which arose was whether the amount to be posted should only include anticipated Costs going forward from the time of the Application, or should also include all Costs since the party required to post security became involved in the Action. The Court noted that determining an amount for Security for Costs was highly discretionary. In this instance, the Court determined that the appropriate amount would include Costs dating back to the time the paying party first became involved. The Court further noted that an Order for security for costs is appropriate where a party enters into a transaction which affects its ability to answer for costs.

The other points of difference between the parties in respect of the calculation of Costs related to what, if any, multiplier should be applied to the appropriate column in Schedule C to the Rules of Court and whether second counsel fees at Trial should be included. The Court settled on twice column 5 of Schedule C, and with respect to Trial fees stated “counsel fees for trial should be based on attendance of first counsel for all scheduled thirty-nine days; and second counsel fees for an additional fifteen days”.

Next, the Court considered the Plaintiffs’ Application for an Order that the Defendant disclose written legal opinions it obtained from its solicitors in 2009 regarding a distribution agreement, and answer questions about related communications with its solicitors. In discussing the issue of solicitor-client privilege, the Court noted that there were some “weaknesses” in the evidence. A correcting Affidavit required by Rule 5.27 was promised but not provided. Namely, the Defendant improperly sought to rely on its own witnesses’ Questioning evidence, which is prohibited by Rule 5.31 and the relevant authorities. The Court also noted that the Questioning evidence of a party’s witness may only be used against the party pursuant to Rule 5.31. In the result, the issues with the evidentiary record were not determinative and disclosure of the privileged communications was not ordered.

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