This Decision dealt with the Costs to be awarded to the successful Defendants following the Trial of a lengthy, high-value Action. The Defendants sought 50% of their actual legal fees and 100% of their recoverable disbursements (amounting to approximately $6 million) or in the alternative, Costs based on Column 5 of Schedule C with a multiplier and 100% of their recoverable disbursements (amounting to approximately $4.5 million). The Plaintiff argued that Costs should be based on Column 5 of Schedule C, but with the application of a smaller multiplier, and the Plaintiff also argued for reductions to the Defendants’ claimed disbursements (amounting to approximately $1.7 million).

The Court begin its analysis by discussing the general principles applicable to Costs Awards: first, that the successful party is ordinarily entitled to Costs; second, that Costs Awards are discretionary, but must be guided by the factors set out under Rule 10.33; and third, that the Court may employ a variety of tools or approaches in determining how to arrive at an Award of reasonable and proper Costs as guided by Rule 10.31. The Court also considered the general rule that Costs awarded on a party-and-party basis should typically provide partial indemnification of approximately 40–50% of the successful Party’s actual fees incurred, but that these fees must be evaluated for reasonableness as guided by Rule 10.2.

The Court considered the parties’ positions as to each of the relevant matters under Rule 10.33 and found both mitigating and aggravating factors. Justice Neufeld held that, in the circumstances, where sophisticated and well-funded litigants are involved in high-stakes litigation, an Award based on a percentage indemnity would be more appropriate than the application of Schedule C, which was not designed with complex commercial litigation in mind.

In the result, the Court directed the parties to an Assessment Hearing before a Review Officer for a determination of the reasonableness of the fees and disbursements incurred by the Defendants. The Review Officer was directed to award Costs on a 45% indemnity basis, in light of the mixed results of the analysis under Rule 10.33. The Court excluded an assessment of the claimed Expert Witness fees from the Review Officer’s purview, and instead ordered some deductions based on the argumentative stance taken by one of the Defendants’ Expert Witnesses. Justice Neufeld also denied the recovery of fees related to certain Interim Applications where the Defendants were not successful, or which were resolved on a without Costs basis. Justice Neufeld noted that a further reference could be brought before the Court under Rule 10.39, if necessary to the Review Officer.