10.31: Court-ordered costs award
10.33: Court considerations in making costs award

Case Summary

The Defendant applied for Costs arising from a Trial in which they were successful. The Defendant sought solicitor and own client Costs of the Action.

The Court stated the general rule that a successful party to an Application, Proceeding or Action is entitled to Costs against the unsuccessful party, and it noted that Rule 10.33 requires consideration of certain factors, including: the result and degree of success of each party, the amount claimed and recovered, the importance of the issues, the complexity of the Action, apportionment of liability, conduct related issues, and any other matter related to the question of ‘reasonable and proper’ Costs. Subsection (2) of the Rule also includes other considerations for the Court including misconduct or other improper conduct on the part of a litigant. The Court further noted that Rule 10.31 gives discretion to the Court as to the nature of the Costs awarded.

In awarding Costs pursuant to Column 3 of Schedule C, the Court noted that the purpose of Costs awards is to partially indemnify the successful party for the legal expenses incurred during the litigation. Party and party costs are deliberately set such that there is not full indemnity as it discourages unwarranted litigation and promotes proportionality in litigation that is commenced, creating an incentive on all litigants to litigate economically. The Court noted that the Defendant was entirely successful, the issue was important to the parties and that there was an absence of existing jurisprudence in Alberta on the issues at Trial in considering the factors in Rule 10.33. Further, the action was not complex and was conducted expeditiously by both parties through use of the Summary Trial process.

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