Rule Details
RUMANCIK v HARDY
Rules Discussed
- Rule 1.2 Purpose and intention of these rules
- Rule 10.2 Payment for lawyer’s services and contents of lawyer’s account
- Rule 10.31 Court-ordered costs award
- Rule 10.33 Court considerations in making costs award
Case Summary
This decision concerned costs arising from competing applications, including a second Summary Judgment Application (the “Second Application”) brought by the Defendant, Michael Bates (“Bates”), and the Plaintiffs’ Application to strike the Second Application as an abuse of process.
Bates represented a co-Defendant and published a Statement of Claim to the media, giving rise to the underlying defamation Action. Bates previously applied for Summary Judgment (the “First Application”) primarily focused on the defence of qualified privilege, which was dismissed. Bates later brought the Second Application, relying on additional records that were not available at the time of the First Application. Justice Eamon held that, while the records were new, they did not address the basis of the dismissal of the First Application and did not justify the Second Application. The Plaintiffs were substantially successful.
The Plaintiffs sought solicitor-client costs or enhanced costs based on a Calderbank offer (the “Offer”). Eamon J. held that solicitor-client costs are reserved for rare and exceptional cases involving reprehensible conduct. While the Second Application failed, Justice Eamon found that it was not brought in bad faith and did not justify solicitor-client costs.
The Court confirmed that costs are discretionary and governed by Rules 10.29, 10.31, and 10.33. Justice Eamon emphasized proportionality and found that Schedule C was an appropriate starting point. Eamon J. declined to order an assessment of solicitor-client accounts, finding it would be disproportionate in the circumstances.
Justice Eamon found that the Plaintiffs’ Offer was a reasonable and genuine compromise, provided a cost advantage, and was unreasonably rejected. As the Plaintiffs achieved a better result than the Offer, Eamon J. held that enhanced costs were warranted to promote settlement and efficiency.
The Court applied Schedule C and accepted a multiplier for certain steps taken after the Offer. In the result, Justice Eamon awarded costs to the Plaintiffs in the range of $22,500, inclusive of disbursements and GST, payable forthwith, subject to adjustment and approval of the final Order.