1.2: Purpose and intention of these rules
10.33: Court considerations in making costs award

Case Summary

This was a Costs Decision following a decision in which Devlin J upheld the Master’s decision to dismiss the Action for long delay. The Defendants of the Action sought costs of $117,256, which they said represents 40-50% of their total legal costs. The Plaintiffs took no issue with an entitlement to Costs but disagreed with the quantum.

Devlin J noted that a costs award is discretionary, but such discretion must be exercised in a principle manner and guided by the principles in Rule 10.33(1) which lay out the considerations in making a costs award. Schedule C of the Rules is one avenue for the Calculation of Costs. Here, both parties submitted proposed Bills of Costs based on Schedule C. Devlin J chose to follow Schedule C but noted that he was not bound to do so.

The Court noted the recent Court of Appeal Decision in McAllister v The City of Calgary, 2021 ABCA 825, which endorsed “ordinary-course indemnification to successful parties, in the absence of special considerations warranting significant enhancement of costs, in the range of 40-50% of actual costs”.

The Court considered whether a multiplier of Schedule C Costs would be appropriate. Devlin J found that some enhancement of Costs was justified because of the large value of the lawsuit, and “certain scandalous allegations made in materials” which were not proven and “often appear irrelevant to the underlying merits”.

Further, the Court found that the Plaintiff had commenced and maintained the litigation as a bargaining chip in a commercial dispute which was contrary to the foundational Rule 1.2.

The Court awarded a two-times multiplier to Column Five in Schedule C for Costs as well as reasonable disbursements. This amounted to 39.5% of the actual costs incurred by the Defendants.

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