R.B. New Co. Ltd. v., 2013 ABQB 659

Court of Queen ’ s Bench of Alberta Citation: R.B. New Co. Ltd. v. 1331440 Alberta Ltd., 2013 ABQB 659 Date: 20131108 Docket: 1203 09747, 1203 09746, 1203 12215 Registry: Edmonton Between: 1203 09747 R.B. New Co. Ltd. Applicant - and - 1331440 Alberta Ltd. and 1329950 Alberta Ltd. Respondents Between: 1203 09746 R.B. New Co. Ltd. Plaintiff - and - 1329960 Alberta Ltd. Defendant Between: 1203 12215 1331440 Alberta Ltd. Plaintiff - and - Raphael Bohlmann and R.B. New Co. Ltd. Defendant(

s) Corrected judgment: A corrigendum was issued on November 13, 2013; the corrections have been made to the text and the corrigendum is appended to this judgment. _ ________________________________________ ______________ Memorandum of Decision on Costs of the Honourable Madam Justice J.B. Veit _________________________________________ ______________

Summary [1] In an interlocutory application, R.B. New Co. unsuccessfully claimed partial judgment of its overall claim for managementfees. It now contends that the successful respondents should have tariff costs under column 2, representing the amount of the partialclaim, rather than under column 3, representing the amount of the total claim. R.B.

New Co. also contends that the successful defendantsshould not be allowed to claim their questioning of its corporate representative, since that questioning, which occurred relatively early inthe proceedings, presumably dealt with broader issues than the claim for partial judgment. [2] The appropriate tariff column is Column 3: not only was the application one for interlocutory relief, and therefore governedby

Schedule C, Rule 1(3)(d), but since no judgment was granted, the amount in issue is still the amount claimed in the pleadings: AmocoCanada Resources Ltd. [3] The successful defendant is entitled to the full amount allowed for questioning under the tariff: on the one hand, it is notgenerally appropriate to minutely dissect actual performance of each of the tariff items, and, on the other, since questioning can only beclaimed once per action, item 5(1), the tariff contains its own discipline with respect to potential abuse. Cases and authority cited [4] By the court: R.B. New Co.

Ltd. v 1331440 Alberta Ltd. 2013 ABQB 487; Industrial Acceptance Corporation Ltd. vBeaupre (1956) (AB CA), 18 W.W.R. (N.S.) 685 (C.A.); Reid v Stein 1999 ABQB 222 , [2000] 2 W.W.R.349; Amoco Canada Resources Ltd. v Amax Petroleum of Canada Ltd. [1992] A.J. No. 950; Albert Bloom Ltd. v Bentinck (Township)[1996] O.J. No. 5593 1. Background [5] R.B. New Co. sued the defendants for approximately $185,000.00 in allegedly unpaid management fees. R.B. New Co. thenbrought an interlocutory application for partial judgment in the amount of approximately $88,000.00.

Prior to the hearing of theapplication, the defendants forwarded to R.B. New Co. a Calderbank offer consisting of a waiver of costs to date in exchange for awithdrawal of the application. In the event, the defendants successfully resisted the plaintiff’s application for partial judgment: seecitation above.

The parties agree that the defendants are entitled to party and party tariff costs. [6] However, New Co has three objections to the defendants’ specific costs proposal: - the Calderbank offer was not a genuine offer to settle and therefore should not entitle the defendants to double costs from its delivery; - Column 2, reflecting the money amount of the claim for partial judgment, rather than Column 3, reflecting the total amount of itsclaim, is the appropriate column; and - because the defendants’ questioning of the plaintiff’s corporate representative occurred in March, i.e. relatively early in theproceedings, it cannot be concluded that the questioning related solely to the application for partial judgment and, therefore, nothingshould be awarded for that step. [7] The issue of the genuineness of the Calderbank offer was dealt with at the hearing of the costs motion in favour of thedefendants.

That leaves the other two issues to be decided. 2. Which column of

Schedule C applies? [8]

Schedule C includes its own guide to

interpretation, which includes the following: R. 1(3) . . . . . the dollar range [in the tariff] indicates the amount recoverable (

a) as against the plaintiff, with reference to the amount claimed by the plaintiff, (

b) as against the defendant, with reference to the amount of the judgment or order against the defendant, or (

c) in the case of an interlocutory application, as against the person liable to pay the costs with reference to the amount claimed by theplaintiff. [9] On a plain reading of the Rule, since this is a situation in which costs are awarded against the plaintiff, the appropriatecolumn is therefore to be based on the amount claimed by the plaintiff. i.e. set out in its Statement of Claim. Alternatively, this was aninterlocutory application where, again, the appropriate column is based on the amount claimed by the plaintiff. [10] R.B.

New Co. urges, however, that since the amount of its specific claim on the specific interlocutory application was onlyfor a portion of its total claim, it would be more appropriate to choose the column that reflects the amount of the actual claim. Thisargument is presumably based on a line of authority which began in Alberta with the Industrial Acceptance Corporation case, continuedthrough the Reid decision and continues to be applicable today.

In Industrial Acceptance the issue was the appropriate column of costsin a situation where judgment had been granted; Porter J.A. held, on behalf of a unanimous court, that the award of costs was to be anaward “which seems to me to be appropriate to the amount actually in issue”. [11] In Amax Petroleum, our Court of Appeal reminded us that, until a court has issued a judgment on a claim, the most usefulmarker for the amount of a claim is the amount set out in the claim. In that case, the amount in the statement of claim was over $2

million, but it was argued on behalf of the losing party on an interlocutory motion that the real value of the claim, as determined by discoveries, was more in the $300,000.00 range. Côté J.A. held: First, what should be the relevant column? Apparently the suit was on its face for over $2,000,000.00 but the appellant now says that discoveries have shown that the amount in issue is more like $300,000.00. As the top column is for suits of $150,000.00 or more, $300,000.00 in issue would invite the court to increase that column.

In addition, the defendant is entitled to take seriously the plaintiffs pleadings and to think that it is a suit for the larger sum until he is told in some manner that it is proposed to abandon part of the claim or to amend the prayer for relief. Rule 606 has a purpose and it is significant that it is found among the costs Rules. Accordingly, I have decided that double column 6 is the appropriate column . [ 12 ] On the interlocutory application in this case, R.B. New Co. was certainly not abandoning the approximately $100,000.00 which was not directly in issue.

In those circumstances, I am of the view that the defendants were entitled to treat the interlocutory application as one made within the context of an overall claim for $185,000.00 and that the latter amount determines the appropriate costs column. 3. Are the defendants entitled to costs for questioning when the questioning presumably did not relate solely to the specific interlocutory motion? [ 13 ] Item 5 of the tariff relates to questioning. R.B.

New Co. alleges that it should not be required to pay the full amount of item 5 because the questioning, which occurred in March while the application was heard in late August, presumably related to matters beyond those covered in the application for partial judgment. [ 14 ] With respect, R.B. New Co.’s approach is not persuasive, for two reasons.

First, I adopt the approach advocated by Lane J. in Bloom : It would be undesirable, even dangerous, for the court to minutely dissect the conduct of a proceeding looking for decisions that, in hindsight, might have been made differently and so shortened the hearing. [ 15 ] Second, and perhaps more pertinently, item 5 contains its own corrective against abuse: it states that this item can only be claimed once per action.

Where there has been questioning, if a litigant chooses to use the questioning on a costs claim in respect of an interlocutory motion, it will not be allowed, without leave, to claim that cost on a subsequent occasion. A choice in this matter should be left to the successful litigant. 4. Costs [ 16 ] If the parties are not agreed on the costs of the costs application, I can be spoken to within 30 days of the release of this decision. Heard on the 6 th day of November, 2013. Dated at the City of Edmonton, Alberta this 7 th day of November, 2013 . J.B. Veit J.C.Q.B.A.

Appearances: Liza Wold, Bryan & Company LLP for the Applicants (Defendants)

H. Toor, McLeod Law LLP for the Respondent (Plaintiff) _______________________________________________________ Corrigendum of the Memorandum of Decision of The Honourable Madam Justice J.B. Veit _______________________________________________________ This decision has been corrected to show the Docket numbers on one line and the style of cause shown for each action number. The Citation number has also been added to the Citation line.