Evans v. The Sports Corporation, 2011 ABQB 616

Court of Queen ’ s Bench of Alberta Citation: Evans v. The Sports Corporation, 2011 ABQB 616 Date: 20111005 Docket: 0603 07734 Registry: Edmonton Between: Richard Evans Plaintiff / Defendant by Counterclaim - and - The Sports Corporation Defendant / Plaintiff by Counterclaim _______________________________________________________ Memorandum of Decision of the Honourable Mr. Justice R.A. Graesser _______________________________________________________ Introduction [ 1 ] Following the trial of this action, I issued Reasons for Decision, Evans v.

The Sports Corporation , 2011 ABQB 244 , in which I invited the parties to address me if they were unable to agree on costs. After that decision, on the application of The Sports Corporation, I revisited the damage award, and issued supplemental reasons, Evans v. The Sports Corporation , 2011 ABQB 478 . [ 2 ] The parties then addressed the issue of costs, and I reserved to consider the submissions as well as to receive further information on their submissions at the oral hearing. Arguments

[ 3 ] Mr. Livingstone, on behalf of Mr. Evans, argued that each party should have a set of costs based on the appropriate column of costs having regard to the success of each on the claim and counterclaim respectively. The two awards would be set off, leaving a balance in favour of The Sports Corporation because of the larger quantum of damages in favour of TSC. [ 4 ] Mr. Livingstone argued that there were in effect two lawsuits: Mr.

Evans’ claim for the unpaid salary owed to him at the time his employment ended (or was terminated by TSC a few days before the contract of employment was to expire), and TSC’s claim for damages for breach of Mr. Evans’ restrictive covenant or non-competition obligations. [ 5 ] Mr. Livingstone also argued that there had been misconduct in the litigation by TSC, citing as an example that TSC had forced Mr. Evans to travel to Edmonton for an examination for discovery, and on arrival, he had been told that Mr. Wilson was not ready to examine him and he would have to stay another day to be examined the next day.

He argued that TSC’s costs should be reduced for that event, in particular. [ 6 ] Mr. Livingstone referred me to Tycholis v. Teem Energy Ltd. , 2007 ABCA 114 . [ 7 ] Mr. Wilson, on behalf of TSC, submitted that only TSC should be awarded costs because of its success in the lawsuit, arguing that the claim and counter-claim should be considered together. Further, Mr. Wilson argued that TSC should be awarded costs on a solicitor and client basis because: 1. Mr. Evans had defamed Mr. Winter and TSC in his statement of defence to counterclaim because of unproven allegations about loss of clients by TSC; 2. Mr.

Evans persisted in making such allegations despite protests on behalf of TSC before the statement of defence to counterclaim was filed; 3. The statement of defence to counterclaim had been provided to TSC before filing in an attempt to force settlement of the action; 4. TSC’s offers of settlement were much closer to the trial award than were Mr. Evans’; 5. Mr. Evans had essentially committed a fraud on Employment Insurance; and 6. I found Mr. Evans incredible at the trial. [ 8 ] Essentially, Mr.

Wilson founds his claim for solicitor and client costs on misconduct during the litigation, as it was acknowledged that there was no basis for solicitor and client costs merely because TSC had succeeded in proving a breach of fiduciary duty. [ 9 ] Alternatively, Mr. Wilson seeks a multiple of the appropriate column under

Schedule C, or an inflationary multiplier. [ 10 ] Mr. Wilson cited Parkridge Homes Ltd. v. Anglin , [1996] A.J. No. 768 (Q.B.) , Del Bianco v. 935074 Alberta Ltd. , 2008 ABQB 467 , and Polar Ice Express Inc. v. Arctic Glacier Inc. , 2009 ABCA 20 . Analysis [ 11 ] I had occasion to address the issue of misconduct in litigation in College of Physicians and Surgeons of the Province of Alberta v. J.H. , 2009 ABQB 48 . That decision was commented on by Moen J. in Brown v. Silvera , 2010 ABQB 224 . Brown was

approved and followed by Greckol J. in Daved v. Daved, 2010 ABQB 696. All of these cases followed the decision in Jackson v. TrimacIndustries Ltd., [12] At paras. 34 and 35 of Daved, Greckol J. stated: [34] In Brown at para. 31, Moen J. provided the following

summary of the points made by Graesser J. in College of Physicians andSurgeons of the Province of Alberta v. J.H., 2009 ABQB 48 , 2009 ABQB 48 at paras. 4-23, 468 A.R. 101 in regard to theawarding of solicitor-client costs on the basis of party misconduct: ⋅ Solicitor-client costs are awarded where the conduct of a party has been 'reprehensible, scandalous or outrageous': Walsh v. Mobil OilCanada, 2008 ABCA 268 , 2008 ABCA 268 at para. 112, 440 A.R. 199; Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, 2004 SCC 9 at para. 26, 2004 SCC 9 , [2004] 1 S.C.R. 303; Young v.

Young, (SCC), [1993] 4 S.C.R.3 at 134, 108 D.L.R. (4th) 193; ⋅ The conduct must have occurred during the course of the litigation: Polar Ice Express Inc. v.

Arctic Glacier Inc., 2009 ABCA 20, 2009 ABCA 20 at para. 21, 446 A.R. 295; ⋅ Solicitor and client costs might suffice to satisfy the objectives of deterrence and punishment that would otherwise be served by apunitive damage award: Colborne Capital Corp. v. 542775 Alberta Ltd., 1999 ABCA 14 , 1999 ABCA 14 at para. 294, 228A.R. 201; College of Physicians at para. 39; ⋅ In order for costs to be awarded on an indemnity basis or solicitor-client basis, as opposed to a party-party basis, the court mustconclude that the case fits within the parameters of a rare and exceptional or unusual case: Jackson v.

Trimac Industries Ltd. (1993), (AB KB), 138 A.R. 161, 8 Alta. L.R. (3d) 403 (Alta. Q.B.), costs orders affirmed 1994 ABCA 199 , 20 Alta.L.R. (3d) 117, 155 A.R. 42 (Alta. C.A.); ⋅ It is a well-established principle that the court may sanction a party by way of costs where allegations of morally reprehensible conductby such party are proven to be groundless by the trier of fact; whether to award increased costs in such situations is a matter of discretionto be exercised judicially by the trial judge: Davis v. 850015 Alberta Ltd., 2003 ABPC 68 , 2003 ABPC 68 at para. 33, 335 A.R.172, citing Zwicker v.

Schubert; Harach v. Schubert, 1999 SKQB 49 , 1999 SKQB 49 at para. 54, 184 Sask.R. 35; and ⋅ Misconduct during the litigation can surely be found if there is no reasonable basis on which to commence, or continue, litigation:College of Physicians at para. 33. [Emphasis added.] [35] In Jackson v. Trimac Industries Ltd., supra, at paras. 28-37, Hutchinson J. detailed the rare and exception circumstances whensolicitor and own client costs should be granted: 1. circumstances constituting blameworthiness in the conduct of the litigation by that party [Reese v. Alberta (1992), (AB KB), 133 A.R. 127, 5 Alta.

L.R. (3d) 40 (Q.B.)]; 2. cases in which justice can only be done by a complete indemnification for costs [Foulis v. Robinson (1978), (ONCA), 21 O.R. (2d) 769, 92 D.L.R. (3d) 134 (C.A.)]; 3. where there is evidence that the plaintiff did something to hinder, delay or confuse the litigation, where there was no serious issue offact or law which required these lengthy, expensive proceedings, where the positively misconducting party was "contemptuous" of theaggrieved party in forcing that aggrieved party to exhaust legal proceedings to obtain that which was obviously his [Max SonnenbergInc. v.

Stewart, Smith (Canada) Ltd. (AB QB), (1987), 48 Alta. L.R. (2d) 367, [1987] 2 W.W.R. 75 (Q.B.)];

4. an attempt to deceive the court and defeat justice, an attempt to delay, deceive and defeat justice, a requirement imposed on theplaintiff to prove facts that should have been admitted, thus prolonging the trial, unnecessary adjournments, concealing materialdocuments from the plaintiffs and failing to produce material documents in a timely fashion [Olson v. New Home Certification Programof Alberta (AB QB), (1986), 69 A.R. 356, 44 Alta.

L.R. (2d) 207 (Q.B.)]; 5. where the defendants were guilty of positive misconduct, where others should be deterred from like conduct and the defendants shouldbe penalized beyond the ordinary order of costs [Dusik v. Newton (BC SC), (1984), 51 B.C.L.R. 217 (S.C.), varied onother grounds (BC CA), (1985), 62 B.C.L.R. 1 (C.A.)]; 6. defendants found to be acting fraudulently and in breach of trust [Davis v. Davis (1981), (MB KB), 9 Man. R. (2d)236 (Q.B.)]; 7. the defendants' fraudulent conduct in inducing a breach of contract and in presenting a deceptive statement of accounts to the court attrial [Kepic v.

Tecumseh Road Builders, (1987), 23 O.A.C. 72, 18 C.C.E.L. 218 (C.A.)]; 8. fraudulent conduct [Sturrock v. Ancona Petroleums Ltd. (1990), (AB KB), 111 A.R. 86, 75 Alta. L.R. (2d) 216(Q.B.)]; 9. an attempt to delay or hinder proceedings, an attempt to deceive or defeat justice, fraud or untrue or scandalous charges [Pharand SkiCorp. v. Alberta (1991), (AB KB), 122 A.R. 81 (Q.B.)]. [13] In Parkridge, which was relied on by TSC, Rooke J. (as he then was) considered costs in the context of unproven allegationsof fraud. He referred to Jackson v. Trimac, and analyzed the factors discussed by Hutchinson J. there.

Rooke J. held that it wassignificant that the defendant’s conduct had unnecessarily lengthened the proceedings, that the defendant was a lawyer, and he foundmisconduct during the trial. [14] At para. 75, Rooke J. held that some of the defendant’s conduct and tactics amounted to misconduct, “deserving ofcondemnation through solicitor-client costs”. He awarded

Schedule C costs for some aspects of the case, and solicitor-client costs forthose aspects that he characterized as misconduct. [15] Rooke J. did allow an inflationary multiplier of 1.39 to the party and party costs awarded under Column 4, citing previousauthority for that. [16] In Del Bianco, two defendants succeeded in an application to strike the statement of claim against them as being vexatiousand an abuse of process, and that the plaintiff was a vexatious litigant.

Romaine J. awarded solicitor and client costs in thosecircumstances, noting (at para. 6) that the plaintiff had “without any reasonable grounds instituted vexatious legal proceedings”. [17] Polar Ice states (at para. 21) that solicitor and client costs are available only for conduct during the suit, and not pre-suitconduct. The Court of Appeal suggested at para. 22 that “trusts or a fiduciary relationship might be an exception, but that is irrelevanthere”. The Court of Appeal awarded costs on

Schedule C to the commencement of trial, and solicitor and client costs thereafter, as itconcluded that there had been misconduct during the trial, especially because the appellant’s employee was “lying under oath”. [18] I do not read para. 21, however, as completely precluding a solicitor and client cost award in rare occurrences when the trialjudge concludes that the interests of justice require that the successful party should be made whole, and should not have to bear anylitigation costs, even though the litigation may have followed the Marquess of Queensbury rules.

It is difficult to reconcile that statementin Polar Ice with the Court of Appeal’s comment in Colbourne Capital Corp. v. 542775 Alberta Ltd., 1999 ABCA 14, to the effect thatsolicitor and client costs might suffice to satisfy the objectives of deterrence and punishment that would otherwise be served by a

punitive damage award (at para. 294). Test cases, claims involving serious or egregious misconduct or unproven allegations of fraud come to mind, although having regard to the discretionary nature of costs, there can be no finite list. [ 19 ] Mr. Wilson draws parallels to the cases he cited here: that the contents of Mr. Evans’ statement of defence to counterclaim were defamatory and essentially vexations, as with the claims in Del Bianco ; that Mr.

Evans claim was based partly on his own misconduct relating to his collecting EI benefits, pressed issues at trial with little value (such as 5 days’ worth of pay) similar to the situation in Parkridge ; and that Mr. Evans had essentially lied under oath in connection with his testimony about solicitation of clients by Messrs. Henys and Kadlecek, similar to Polar Ice . Analysis [ 20 ] I will deal firstly with Mr. Livingstone’s argument that each party should be awarded

Schedule C costs on the appropriate column, and those costs should be set off against each other, leaving a net amount payable to TSC based solely on

Schedule C amounts. [ 21 ] Costs are always in the discretion of the Court. There is no contractual entitlement to any level of costs affecting this matter; the Contract of Employment is silent on costs. Costs are governed generally by Rule 10.29 and in more detail in R. 10.33. [ 22 ] The trial commenced under the old Rules of Court; argument took place after the new Rules came into effect and judgment was rendered after the new Rules were in place. Essentially, there are no significant differences between the old Rules and the new Rules in relation to costs.

The court’s powers and the parties’ entitlements have not changed. That being the case, decisions such as Jackson v. Trimac and Daved (for example) are still relevant and guide the Court in the assessment of costs. [ 23 ] Here, I disagree with Mr. Livingstone’s characterization that the trial was essentially two lawsuits: one about TSC’s employment obligations to Mr. Evans, and the other about TSC’s claims for breach of fiduciary duty and non-competition obligations.

In my assessment, the lawsuit was about one central thing: the Contract of Employment, and about sorting out the rights and obligations and breaches of those obligations when the relationship ended. [ 24 ] Further, both sides’ arguments were based on their

interpretation of the Contract and the contractual rights they had and the obligations they owed. While the allegations of breach were different, the parties based their claims on the Contract and sought remedies consistent with their

interpretation of the Contract. [ 25 ] As such, I do not see this as a case where the claim and counterclaim were linked only by the parties; the claim and counterclaim arose out of the same agreements. [ 26 ] The fact that both parties sought more than they were ultimately awarded is a common feature of litigation. Parties rarely ask for less in their prayers for relief than they think they are entitled to, and most claims are based on the parties’ highest hopes. That each is awarded less than they initially claimed is not usually a great victory for the other side, but an exercise in reality.

A defendant or defendant by counterclaim’s success is generally not measured by what percentage of the other side’s claim they have reduced, but whether they have beaten an offer of judgment. This was noted by McIntyre J. In Lavallee v. Siksika Nation , 2011 ABQB 282 . [ 27 ]

Schedule C costs at the end of a trial are in any event usually based on the amount awarded and not claimed, although if costs have been awarded along the way to trial (and not payable until after the trial), those costs may be based on the amount of the claim. Costs in the cause, or costs to be set by the trial judge, will normally be based on the value of the ultimate award. [ 28 ] The Court certainly has the jurisdiction and discretion to award costs to the successful plaintiff on the claim, and to the successful plaintiff by counterclaim on the counterclaim.

That is not the usual course, but remains an option in the appropriate circumstances. That appears to have been the result in Tycholis .

[ 29 ] The circumstances of this case do not support mutual cost awards. The claim and counterclaim are too closely connected; both required common evidence as to the formation of the Contracts and the parties’ conduct during the contract period. One claim could not realistically be expected to settle without the other. [ 30 ] Thus, I find that Mr. Evans is not entitled to costs arising out of the result of the trial; he is obliged to pay costs to TSC. Quantum of Costs [ 31 ] This was obviously a bitterly contested lawsuit. Mr. Winter and Mr.

Evans did not like each other while they worked together; their enmity was obvious in their testimony. Mr. Kotlowitz felt betrayed. I heard evidence or submissions from counsel during the trial to the effect that Mr. Winter threatened to ruin Mr. Evans; that he commenced similar litigation against Mr. Evans in Colorado; and that he badmouthed Mr. Evans whenever he could. Having regard to the outcome of this trial, however, these actions on behalf of Mr. Winter could not be characterized as outrageous. [ 32 ] I heard from Mr.

Livingstone about difficulties in getting the matter set for trial; I heard about difficulties getting documents produced by TSC; I heard about difficulties with examinations for discovery proceeding as scheduled. Mr. Livingstone submitted that much of Mr. Winter’s and Mr. Kotlowitz’s testimony was unnecessary and that the trial was prolonged by it. These were all matters that apparently occurred during the litigation. [ 33 ] I heard evidence from TSC that Mr. Evans, Mr. Kadlecek and Mr. Henys (directly or through his son) plotted to take over the Eastern European connection from TSC; I heard evidence that Mr.

Evans collected Employment Insurance when he should not have; I heard submissions from counsel that Mr. Evans had used a defamatory or inflammatory draft defence to counterclaim to attempt to extort TSC into a settlement; I heard submissions that Mr. Evans had wasted the court’s time with trifling matters such claiming Mr. Evans’ last 5 days’ pay. And I was reminded that, in my decision, I made unfavourable findings regarding Mr. Evans’ credibility. [ 34 ] Insofar as costs are concerned, the course of litigation complaints I heard about Mr.

Evans related to the draft statement of defence to counterclaim, trifling matters being pushed and credibility. [ 35 ] The Courts have not created any presumptions that breaches of trust or breaches of fiduciary duty should result in solicitor and client costs being awarded. Indeed, such a presumption would seem contrary to the principles in Jackson v. Trimac .

While Polar Ice states that solicitor client costs will be awarded only where a party’s conduct during the litigation warrants it, that decision appears to expressly leave open arguments for solicitor and client costs in cases involving breaches of trust or fiduciary duty. [ 36 ] Failing to prove fraud and making and pursuing unsubstantiated allegations of misconduct are examples of where solicitor and client costs may result from the failure to substantiate serious allegations and dragging the opposing party through unsuccessful litigation. Solicitor and Client Costs [ 37 ] Is there anything in Mr.

Evans’ conduct during the litigation that warrants an award against him of solicitor and client costs? [ 38 ] Mr. Wilson made much of the timing of Mr. Livingstone sending a draft statement of defence to counterclaim to him, in close proximity to a settlement proposal. Mr. Wilson suggests that the defence to counterclaim contained defamatory statements about Mr. Winter, and was sent to him with the threat (express or veiled) that if TSC did not settle the action, the statement of defence to counterclaim would be filed.

[ 39 ] Mr. Evans’ statement of claim, filed June 20, 2006, claimed damages for breach of the Employment Contract between him and TSC. TSC’s statement of defence and counterclaim, filed September 12, 2006, alleged that Mr. Evans had no previous experience as a sports agent, and that he had a long-held dream of becoming one. It then provided a list of alleged breaches of duty, some of which were substantiated and some of which were not. [ 40 ] The statement of defence to counterclaim, which was eventually filed on November 14, 2006, alleges in para. 6 that Mr.

Winter’s relationship with certain significant players had “grown tenuous” and listed some 8 players who had terminated their agency relationship with Mr. Winter. It is that allegation that Mr. Wilson claims was defamatory and should result in solicitor and client costs. Mr. Wilson responded to the draft defence stating that it was factually inaccurate and defamatory of Mr.

Winter. [ 41 ] TSC filed a reply on November 23, 2006 which contains some of the same allegations about the statement of defence to counterclaim as was raised before me in addressing costs. [ 42 ] I have reviewed the correspondence relating to the draft defence. There is no support for Mr. Wilson’s claim that providing it in advance was an attempt to extort a settlement, or put pressure on TSC to settle to avoid having the pleading filed. Pleadings often contain allegations which are not proven at trial.

I agree that the words in the draft statement of defence to counterclaim are capable of supporting a defamatory meaning, but that is not beyond argument. [ 43 ] In any event, defamation claims cannot be founded on pleadings. Pleadings enjoy privilege against defamation. The allegations made by Mr. Evans were irrelevant to the lawsuit, as were allegations about his lack of previous experience. Both parties are guilty of attempting to slag the other in these proceedings. Later, Mr. Evans alleged, irrelevantly, that Mr. Winter had received payments in contravention of NHLPA rules. This was presumably after Mr.

Winter had threatened to ruin Mr. Evans and had sued him in Colorado. [ 44 ] No applications were made to strike irrelevant or frivolous or vexatious allegations. No evidence was led that any client or potential client took the allegations which went back and forth between the parties seriously. While Mr. Wilson’s reply to Mr.

Livingstone’s draft statement of defence to counterclaim alleged it was defamatory, and that solicitor and client costs would be sought if the defence was not amended, there was no outrage expressed in his response that the offer and draft defence to counterclaim constituted some form of extortion or improper pressure to settle. [ 45 ] My knowledge of the conduct of the parties as they related to allegations back and forth is that neither side distinguished itself. Each side attempted to discredit the other to some extent.

None of the discrediting was relevant to anything in the lawsuit. [ 46 ] I recognize that in some circumstances, a party who makes unfounded allegations about the character of the other party and unreasonably persists in those allegations during the litigation may face cost penalties. As in Del Bianco and College of Physicians , those cost penalties can include solicitor and client costs.

But Del Bianco was a case where the pleadings were struck early, and as being frivolous and vexatious, filed by a vexatious litigator, and College of Physicians involved as a central issue in the application, unwarranted attacks on the character of the Registrar. [ 47 ] This is a different situation. The allegations created noise, but were irrelevant. They added to the bitterness evident in this litigation (both ways). The truth any of the irrelevant allegations was not an issue at trial, and at the end of the day, it was not necessary for me to make findings in that regard.

At trial, the parties mainly stuck to the relevant matters. [ 48 ] This is not a basis to increase the level of costs in favour of TSC. [ 49 ] As to the fact that Mr. Evans took positions that did not succeed, that can be said of every unsuccessful litigant. That I did not find Mr. Evans’ testimony credible in some areas does not mean that I found him to be a liar or attempting to mislead the Court. People frequently tell different versions of events. That is what trials are made of. People are sometimes mistaken. People have different

interpretations of words. That their testimony is affected by their

interpretation of words is not surprising. People also rationalize their conduct, and will naturally try to paint themselves in the most favourable light.

[ 50 ] I say these things to point out that there is a difference between finding someone not credible, and finding that someone is deliberately lying, or fabricating evidence, or attempting to mislead the Court. A judge should call a spade a spade, where necessary or appropriate. I made no finding that Mr. Evans lied, or was untruthful. I did not accept some of his evidence. [ 51 ] Mr. Evans took positions, and made

interpretations, of his rights and obligations regarding what was solicitation, who was an “employee” and of the Employment Insurance regime which I ultimately rejected. His testimony on those matters was generally consistent with his

interpretations. [ 52 ] Again, in appropriate cases, where the litigation is based on or perpetuated by lies, or where a party deliberately attempts to mislead the Court, solicitor and client costs may be appropriate. They may also be appropriate as a remedy where a lawsuit is based on a breach of the implied undertaking (as was the case in as in LSI Logic Corporation of Canada Inc. v. Logani , 2001 ABQB 968 ).

But that is not the situation here. [ 53 ] If every time a judge found that a party was incredible or not to be believed on a point in his or her evidence, the party had solicitor and client costs awarded against him in connection with the entire lawsuit, there would be few lawsuits where solicitor and client costs were not awarded and they would become the rule and not the exception. [ 54 ] That argument fails in the circumstances of this case. [ 55 ] The same may be said as to pushing minor issues. Mr. Evans did push the fact that he had not received the last 5 days of pay. But he was entitled to payment.

That should have been admitted in the lawsuit, not contested. It was TSC that resisted paying Mr. Evans, or recognizing an obligation for, an obvious matter. The other points which Mr. Evans was unsuccessful on were at least arguable. There was no undue time taken during the litigation over minor matters for which Mr.

Evans should be penalized with solicitor and client costs. [ 56 ] To the extent that I have a jurisdiction to award solicitor and client costs based on the nature of the litigation, or as an alternate to some form of punitive damages as suggested in Colborne , I do not see this as an appropriate case to do so. Polar Ice leaves open the question of awarding solicitor and client costs for breaches of trust or fiduciary duties. I can think of cases where the nature of the relationship and the abuse of that relationship may call out for full indemnity of the beneficiary.

Abuses of fiduciary obligations by express trustees, lawyers, attorneys under powers of attorney and guardians may require solicitor and client cost awards to properly compensate the beneficiary. [ 57 ] Here, I found that Mr. Evans owed fiduciary duties to his employer, but that TSC’s damages all fell under the provisions of the Employment Contract. At para. 329, I held that there was no reason to assess damages for breach of fiduciary duty because they had been subsumed within the breach of contract award. To some extent, therefore, the characterization of the misconduct by Mr.

Evans as breaches of fiduciary duty were moot. I see no reason here to impose solicitor and client costs on Mr.

Evans merely because his breaches of contract could also be (and were) characterized as breaches of fiduciary duty. [ 58 ] There are undoubtedly situations where a fiduciary in an employment context may have breached those duties in such a manner as to warrant solicitor and client costs against him or her; this is not one of the cases to use that remedy or exercise that discretion. [ 59 ] To summarize, TSC has failed to establish appropriate grounds to persuade me to award solicitor and client costs against Mr. Evans. The exceptional circumstances referred to in Jackson v. Trimac have not been made out. Increased

Schedule C Costs

[ 60 ] There is also a discretion to increase the table amounts in

Schedule C, in appropriate circumstance, by applying a multiplier. Here, the amount awarded to TSC falls squarely in the middle of column 4. That is the appropriate column. There is no valid reason to apply a multiplier. The same factors which may be considered in determining whether or not to award solicitor and client costs apply here. There is nothing in those factors which misses solicitor and client costs, but suggests that a multiplier be used here. [ 61 ] Insofar as increasing

Schedule C costs by an inflationary amount, I realize that has been done by some of my brethren, including Rooke, A.C.J. in Parkridge. There may have been a better argument for that before the implementation of the new Rules of Court on November 1, 2010.

Schedule C was not changed in that process.

Schedule C should be considered to be current as of that date. The trial was essentially complete by then, with only final argument remaining. The Rules of Court contain no provision for automatic increases in

Schedule C on account of inflation. Costs and the measure of costs are always in the discretion of the Court, and I do not see inflation as an automatic basis to increase the tariff amounts. It may be a relevant factor to consider. I am not persuaded that there is an argument for inflation from

Schedule C costs in relation to a trial where all of the evidence was in by November 1, 2010 and only argument, decision and arguments over costs remained. In any event, no information on inflation from an economist after November 1, 2010 was put in evidence, and as held in Lavallee , that is a further factor to decline to make such an adjustment. Conclusion [ 62 ] TSC shall have costs of the action on Column 4. It did not beat an offer of judgment, so there is no basis to increase costs in that regard. The fact that TSC’s offer was closer to the final result than was Mr.

Evans’ offer is not a basis to increase costs. Absent beating an offer, as in horseshoes, close doesn’t count. [ 63 ] None of the arguments presented persuade me to exercise my discretion in favour of awarding TSC solicitor and client costs. Any pre-action misconduct is reflected in the judgment; any course of action misconduct here does not warrant solicitor client costs overall, or for any portion of the action. [ 64 ] I am also not persuaded that I should exercise my discretion in favour of awarding TSC an increased measure of

Schedule C costs. For the same reasons as I decline to award solicitor and client costs, I do not exercise a discretion to increase the tariff amounts or apply a multiplier. Nor is inflation here a reason for me to increase the tariff amounts. [ 65 ] As success has been divided as to costs, there shall be no costs in relation to the costs application, or the submissions made following the hearing.

Because the application on May 11, 2011 arose mainly out of an error made by me in the assessment of damages, there should be no costs awarded in connection with that appearance, or the submissions made as a consequence of that hearing. Concluding Comments [ 66 ] There is nothing in the jurisprudence relating to costs that suggests that solicitor and client costs are anything other than extraordinary. They are awarded in exceptional cases.

They are routinely sought in pleadings (which is somewhat ironic, as one might infer that the party pleading that expects the other party to misconduct itself in the litigation, before any misconduct has occurred). [ 67 ] Solicitor and client costs are also routinely sought after trial, often without any proper basis or foundation. I am reluctant to see the costs process become another trial after the trial, revisiting every strategic decision, paragraph in pleadings, application, position, question on direct and question on cross-examination, looking for misconduct.

Such a process would seem to run afoul of the foundational rule 1.2 relating to proportionality, economy and efficiency, although this process does appear to be invited by Rule 29.33. [ 68 ] If counsel are going to seek solicitor and client costs, there should be a proper foundation set up, advance notice to opposing counsel, an appropriate evidentiary foundation, and proper materials for the matter to be dealt with properly at the hearing.

Heard on the 12 th day of September, 2011. Dated at the City of Edmonton, Alberta this 4 th day of October, 2011. R.A. Graesser J.C.Q.B.A. Appearances: Stephen Livingstone McLennan Ross LLP for the Plaintiff / Defendant by Counterclaim P.D. Wilson, Q.C. Fraser Milner Casgrain LLP for the Defendant / Plaintiff by Counterclaim