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

Case Summary

The Applicant applied for Costs after being successful on an Application. The Applicant was a school association governed by a Board of Directors. After numerous home schooling personnel decided to resign, the Respondent, a new Board of Directors, was purportedly elected. The Respondent, among other things, padlocked the school and attempted to take over the school association’s social media and bank accounts. An Originating Application was brought on an emergency basis. The Respondent filed a counter-Application supported by a 300 page Affidavit. The school association filed an Affidavit in response and conducted Questioning. At the Application, Renke J. found that the election of the new Board of Directors was illegitimate, and that the Respondent lacked standing to bring its claim. The Respondent was not entitled to an equitable remedy for their claim of breach of fiduciary duty because they did not come with “clean hands”.

Renke J. noted that Costs must be applied in accordance with the foundational Rules, including Rule 1.2. His Lordship further noted that pursuant to Rule 10.31, an award of Costs is discretionary; the discretion extends to awarding Costs with or without reference to Schedule C; the discretion should be based on the consideration of factors in Rule 10.33; and Costs awarded may fall into one or more different categories consisting of party-party Costs, a lump sum, indemnity Costs, and full indemnity Costs.

Renke J. noted that the factors to be considered under Rule 10.33 include the result of the Action and the degree of success of each party, the amounts claimed and recovered, the importance of the issues, the complexity of the Action, the apportionment of liability, the conduct of the parties, and other matters that the Court may consider appropriate.

The school association sought full indemnity Costs. Renke J. noted that full indemnity Costs (solicitor and own client Costs) were only justified in the most exceptional circumstances and were only appropriate if the losing party engaged in some form of misconduct. Renke J. found that the Respondent’s litigation conduct was unreasonable because there was no serious issue of fact or law. The school association was forced to take proceedings to correct the obvious wrongs of the Respondent. The Respondent had also introduced issues in the Application that had no foundation and did not belong in the Application.

His Lordship noted that although the litigation was not long, it was incredibly urgent. The brevity of the timeline did not undermine a claim for full indemnity Costs. In fact, the time-constraints of the Application supported a form of elevated Costs. Renke J. found that if the litigation had focused only on the matters essential to the Application, it would not have been complex. However, the Respondent had introduced many arguments that were ultimately groundless. Significant work had to be done to show that the Respondent’s arguments had no legal support. As a result, the Application involved many complexities that demanded attention in a short-time frame. Ultimately, Renke J. awarded enhanced Costs of $62,700.00.

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