4.24: Formal offers to settle
10.29: General rule for payment of litigation costs
10.30: When costs award may be made
10.31: Court-ordered costs award
10.33: Court considerations in making costs award

Case Summary

The Respondents were found to have breached a section of the Professional and Occupational Associations Registration Act, RSA 2000, c P-26 by a disciplinary committee. That decision was upheld by an appeal committee, and then again upon further appeal to the Court of Queen’s Bench, leaving the parties to address Costs of the Appeal, as well as the Costs of two interlocutory Applications leading up to the Appeal.

Justice Shelley noted that while Rule 10.29 presumptively entitles a successful party to Costs, the Court maintains wide discretion as contemplated in Rule 10.31. This framework applies equally where the Court elects, per Rule 10.30, to assess Costs arising in interlocutory matters that were not previously addressed.

The impugned interlocutory Applications concerned whether bias claims could be heard. The Applicants argued that their success in the Appeal, including in establishing that no bias existed, entitled them to Costs of the steps taken in advance. The Respondents noted that they were successful in the interlocutory Applications, entitling them to argue bias, and therefore they should be awarded Costs. Justice Shelley found that the Respondents’ success in the interlocutory Applications should be considered when making a Costs Award.

More narrowly, the parties disputed whether Costs of an interlocutory Consent Order were payable. The Applicants argued that as the successful party overall, they should be awarded Costs for a procedural Consent Order. The Respondents argued that neither party should be awarded Costs as neither party had won or lost. Justice Shelley held that a procedural Consent Order did not attract a Costs Award.

With respect to the Appeal, the Applicants argued that the complexity and the Respondents’ baseless allegations of bias provided grounds for enhancement of Costs from Column 1 to Column 3. The Respondents argued that the Appeals were neither lengthy nor complex, and also that they their concern had been legitimate such that enhanced Costs should not be awarded.

The Court considered Costs of the Appeal on the ground of misconduct, noting the discretionary factor codified in Rule 10.33(g). Justice Shelley found that the allegations of bias did not rise to the level necessary to award enhanced Costs.

The Court also considered Costs of the Appeal in view of a pre-Trial offer which had been made, notwithstanding that it did not comply with Rule 4.24(2). The Applicants argued that Costs should be doubled as the Respondents failed to accept a pre-Trial offer, given that the Applicants’ case was strong, and it would not have been in the public interest to alter penalties that had been imposed in a disciplinary hearing. The Respondents argued that the pre-Trial offer was not genuine, as the Applicants had merely offered to waive Costs that had not yet been awarded, in exchange for the withdrawal of the Respondents’ Appeals. Justice Shelley found that the Applicants’ case was strong and that they did make a genuine offer to settle. Her Ladyship concluded that the Applicants were due Costs based on Column 2, and that they were entitled to double Costs in respect of all steps taken after the pre-Trial offer to settle.

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