Rarotonga, 2010

Simon's Megalomaniacal Legal Resources


ADMINISTRATIVE LAW | SPPA / Fairness (Administrative)

home / about / Democracy, Law and Duty / testimonials / Conditions of Use

Civil and Administrative
Litigation Opinions
for Self-Reppers

Simon's Favourite Charity -
Little Friends Lefkada (Greece)
Cat and Dog Rescue


Civil Litigation - Costs - Partial/Substantial/Full Indemnity


Part 2

. Amer v. Shaw Communications Canada Inc.

In Amer v. Shaw Communications Canada Inc. (Fed CA, 2023) the Federal Court of Appeal considered substantial indemnity costs, here relating to labour arbitration under the CLC:
[87] In the subsequent decision of this Court in Bank of Nova Scotia v. Fraser, 2001 FCA 267, [2001] F.C.J. No. 1404 (QL), however, this Court made it clear that Banca does not stand for the proposition that substantial indemnity costs can only be awarded where there has been objectionable conduct by the employer in the conduct of the litigation. In that case, Justice Sexton, writing for the Court, found at paragraphs 6-8:
The Bank relies on a case in this Court, Banca Nazionale Del Lavoro of Canada Ltd. v. Lee-Shanok (1988), 87 N.R. 178 at pp. 190-91 (F.C.A.), for the proposition that solicitor-client costs can only be awarded arising out of conduct during the litigation.

We do not agree that the Banca case stands for this proposition. Justice Stone wrote:
An extraordinary award of this kind ought only to be made in circumstances that are clearly exceptional, as would be the case where an adjudicator wished thereby to mark his disapproval of a parties' conduct in a proceeding.

It is for the adjudicator to determine in the first instance the appropriateness of awarding solicitor-client costs. It is generally open to an adjudicator to select the basis on which costs will be awarded.
It is clear from Justice Stone's reasons that he did not intend to restrict the ability of the adjudicator to award solicitor-client costs to situations involving conduct which took place only during the course of the legal proceedings. It is clear from his reasons that he was simply giving an example of exceptional circumstances in which solicitor-client costs could be awarded.

Other case law is more explicit that solicitor-client costs may be awarded based on things other than conduct during the proceedings. In Styles v. British Columbia, 1989 CanLII 235 (BC CA), 1989 B.C.J. No. 1450, (CA) the Court said:
Solicitor and client costs should not be awarded unless there is some form of reprehensible conduct either in the circumstances giving rise to the cause of action or in the proceedings which make such costs desirable as a form of chastisement.
Another reason for awarding solicitor-client costs is simply to save harmless an innocent litigant. In Goulin v. Goulin, 1995 CanLII 7236 (ON SC), 1995 O.J. No. 3115 at page 3, the Court said that:
Where one party has made allegations of fraud and wrongdoing that were not borne out and admittedly could not be borne out costs on a solicitor-client scale should be awarded. The point is to chastise or punish reprehensible conduct and to save harmless an innocent litigant from the otherwise unnecessary expense of litigation.
[Emphasis added].
[88] Justice Sexton’s reasons signal that it is open for adjudicators to award substantial indemnity costs in a number of scenarios, including when the decision maker feels it is appropriate “to save harmless an innocent litigant”.

[89] There are several awards issued under Division XIV of Part III of the Code where adjudicators have awarded substantial indemnity costs without finding the employer’s conduct, either before or during the litigation, to have been reprehensible, scandalous or outrageous: see e.g. Kaszyca v. Air Canada, [2015] C.L.A.D. No. 152; Ford v. King’s Transfer Van Lines Inc., 2013 CanLII 68183 (CALA); Deslauriers v. Canadian Auto Relocator Services Inc., [2013] C.L.A.D. No. 113; Roang v. Carrier Sekani Tribal Council, [2011] C.L.A.D. No. 3 [Roang]; Rosettani v. Bank of Nova Scotia, [2010] C.L.A.D. No. 278 [Rosettani]; Schinkel v. Brico Transportation Services Ltd., [2008] C.L.A.D. No. 378; Spyglass v. Mosquito Grizzly Bear's Head Lean Man First Nation, 2007 CanLII 81323 (CALA); Yesno v. Eabametoong First Nation Education Authority, [2006] C.L.A.D. No. 352; Decle c. 137049 Canada Inc. (Maisliner), [2006] D.A.T.C. no 300; Wilson v. Mowachaht/Muchlat First Nation, [2000] C.L.A.D. No. 147 [Mowachaht].

[90] In some of them, the adjudicators noted that an award of substantial indemnity costs was required to make a complainant whole. In those cases, substantial indemnity costs were awarded because, without them, the complainant would have been deprived of the benefits intended to be given under the Code: Roang at para. 113. As Adjudicator Noonan found in Rosettani at paragraphs 6 and 11-13:
I am of the view that it is generally open to an adjudicator to decide the basis on which costs will be awarded and, for the reasons outlined below, I do not believe that an award of partial indemnity costs in this case … would allow for the Complainant to be made whole under the Code.


There is also a strong need here to protect the Complainant, an innocent party, from losing for winning and it bears repeating that the modest size of her damage award was as a direct result of her having taken the initiative to mitigate her loses [sic]. She should not be penalized for doing exactly what the courts and Tribunals have urged her to do.

I simply do not see any other way to fully compensate the Complainant for her unjust dismissal. If substantial indemnity costs were not awarded after the lengthy hearing in this case, the Complainant would have been effectively deprived of the benefits Parliament intended to give to her under the Code. It is only equitable to require the Bank to pay the substantial indemnity legal costs incurred by the Complainant.

It has been held that an award of costs may serve several useful functions, one being to ensure that financial compensation is not reduced by the need to pay legal fees, another to provide for a deterrent against the violation of employee rights and to level the playing field between otherwise unequal parties (See: Wilson v. Mowachaht First Nation, [2000] C.L.A.D. No. 147 (Can. Arb. Bd.)).
[91] Thus, in these cases, there is recognition that one of the purposes of awarding costs is “to ensure that [an] award [under the Code] is not reduced because the employee is required to pay legal fees”: see Mowachaht at para. 21.

[92] While these cases are a minority trend in the case law under Division XIV of Part III of the Code, the Adjudicator is certainly not alone in making an award of substantial indemnity costs in the absence of reprehensible employer conduct.

[93] The unjust dismissal provisions, now contained in Division XIV of Part III of the Code, were designed to afford non-unionized non-managerial workers in the federal private sector, with at least one year’s service, protection from dismissal without cause similar to the protection against dismissal without cause enjoyed by unionized workers. When the provisions were first introduced in 1978, the then Minister of Labour, the Honorable John Monroe stated in his speech in the House of Commons:
It is our hope that [the amendments] will give at least to the unorganized workers some of the minimum standards which have been won by the organized workers and which are now embodied in their collective agreements. We are not alleging for one moment that they match the standards set out in collective agreements, but we provide here a minimum standard. [Emphasis added.]

(House of Commons Debates, vol. II, 3rd Sess., 30th Parl., December 13, 1977, at p. 1831).
[94] He further explained the purpose of the unjust dismissal provisions to the Standing Committee on Labour, Manpower and Immigration in March 1978 as follows:
The intent of this provision is to provide employees not represented by a union, including managers and professionals, with the right to appeal against arbitrary dismissal — protection the government believes to be a fundamental right of workers and already a part of all collective agreements.

(House of Commons, Minutes of Proceedings and Evidence of the Standing Committee on Labour, Manpower and Immigration, Respecting Bill C-8, An Act to amend the Canada Labour Code, No. 11, 3rd Sess., 30th Parl., March 16, 1978, at p. 46).
[95] As noted by Justice Abella, writing for the Supreme Court in Wilson at paragraph 46, the provisions that are now in Division XIV of Part III of the Code:
.... have been interpreted by labour law scholars and almost all the adjudicators appointed to apply them, namely, that the purpose of the 1978 provisions in ss. 240 to 246 was to offer a statutory alternative to the common law of dismissals and to conceptually align the protections from unjust dismissals for non-unionized federal employees with those available to unionized employees: Geoffrey England, “Unjust Dismissal in the Federal Jurisdiction: The First Three Years” (1982), 12 Man. L.J. 9, at p. 10; Innis Christie, Employment Law in Canada (2nd ed. 1993), at p. 669; Arthurs Report, at p. 172.
[96] In the years following 1987, when Banca was decided, legal fees have increased substantially in this country, and legal representation for ordinary citizens in civil matters for which legal aid is not available has become increasingly unaffordable: for a discussion of this phenomenon, see Thomas A. Cromwell & Siena Anstis, “The Legal Services Gap: Access to Justice as a Regulatory Issue” (2016) 42:1 Queen's LJ 1 at 2-9; Action Committee on Access to Justice in Civil and Family Matters, Access to Civil & Family Justice: A Roadmap for Change (Ottawa: Action Committee on Access to Justice in Civil and Family Matters, 2013) at iii, online.

[97] In the unionized environment, trade unions provide legal representation to grievors in dismissal and other grievances, financing the cost of representation through the dues all members pay. Sometimes, lawyers are retained to represent grievors; sometimes, union representatives do so. Thus, unionized employees do not face the burden of paying for legal representation in a dismissal grievance.

[98] It seems to me that it should be open to an Adjudicator under Division XIV of Part III of the Code to award compensation for legal fees incurred by a wrongfully dismissed complainant to place them on a similar footing.

[99] Thus, in light of the purpose behind the unjust dismissal provisions in Division XIV of Part III of the Code, which were designed to put non-unionized workers on a more even footing with unionized workers, and the wide remedial authority enshrined in paragraph 242(4)(c) of the Code, I cannot conclude that substantial indemnity costs may only be reasonably awarded where there is unduly objectionable employer conduct. Several adjudicators have held otherwise.

[100] In the case at bar, the appellant was of limited means, earning just under $40,000.00 per year when employed by the respondent. In addition, she was a single parent. Given the amount of damages awarded in the instant case, which were limited to out-of-pocket losses for a relatively short period and a modest amount of severance pay, it is entirely possible that the fees charged by the appellant’s counsel might have been close to or perhaps even exceeded the amount of damages awarded. Were this the case, the appellant would have been worse off for pursuing the complaint than she would have been had she not filed a complaint. Such a result would be the antithesis of a remedial order and defeat the purpose of the unjust dismissal provisions in the Code.

[101] On the other side of the ledger, the appellant was faced with a large respondent, with substantial resources and the ability to pay experienced labour counsel, who mounted a lengthy case over several days of hearing and through lengthy written submissions.

[102] In the circumstances, I believe that it was reasonably open to the Adjudicator to have awarded the appellant substantial indemnity costs. Anything less may well have led to a denial of any real remedy. There is ample authority from other adjudicators to support the award, and it is allowable under the jurisprudence from this Court. Moreover, the award is in keeping with the purpose behind the unjust dismissal provisions in the Code.
. Regional Municipality of York v. Ontario (Minister of the Environment, Conservation and Parks)

In Regional Municipality of York v. Ontario (Minister of the Environment, Conservation and Parks) (Div Court, 2023) the Divisional Court considered (and grants) full indemnity costs in favour of a municipality against Ontario, here overriding a prior costs agreement between the parties:

[30] Ontario submits that the parties had originally agreed before the October 2022 hearing that there should be no award for costs against either party and that such disposition of costs should now be applied.

[31] Ontario also argues that York Region could and should have anticipated that its application could be rendered moot by future government action. In response, York Region describes this argument advanced by Ontario as being a cynical suggestion that it should have known mootness was a possibility because Ontario had previously taken similar legislative action to frustrate its pursuit of relief by passing the YRWA shortly after York Region had indicated its intention to commence an application for judicial review.

[32] Although it may be inferred that York Region was aware that its application could be rendered moot when Ontario communicated its intention in June 2021 to appoint an advisory panel to report on a solution to York Region’s wastewater needs, months before passage of the YRWA and more than a year before passage of the SGA, the sequence of events suggests that Ontario actually was taking background steps to ensure that no decision by the Minister as to the plan submitted by York Region for discharge of wastewater into Lake Simcoe would ever see the light of day. Further, none of this was made known directly to York Region or to the court at the time of the October 2022 hearing.

[33] York Region submits that in the circumstances it is entitled to its full costs if the court chooses not to exercise its discretion to make a decision on the merits, as is now the case. It relies on the authorities cited in Josef v. Ontario Minister of Health, 2013 ONSC 6091 (CanLII) and R. v. Dadzie, 2018 ONSC 1332 (CanLII) for the proposition that costs may be awarded to an applicant whose application has been rendered moot by the conduct of the government, including legislative repeal. Such an award may be justified on the basis of factors that include:
(a) the applicant is a public interest litigant and the application raises issues of general public interest;

(b) the government caused the application to become moot; and

(c) as a result of the government’s actions, the applicant has effectively achieved the result it sought on the application.
[34] York Region has satisfied each of these factors. It notes that, while it would have preferred the Lake Simcoe solution recommended in its plan, the SGA provides the certainty it originally sought when it commenced this application for judicial review (see: Broomer v. Ontario (Attorney General), 2004 CanLII 27253 (ON SCDC)). The steps taken by Ontario at least constitute a path which allows for all necessary steps to be taken to manage York Region’s wastewater needs, albeit by means of the Lake Ontario solution that had not been preferred by it. In passing the SGA and imposing the Lake Ontario option, Ontario in effect acceded to York Region’s position that certainty as to the approach to be taken by it was necessary to permit it to proceed with management of its wastewater needs in order to address anticipated growth in the municipality.

[35] Given the sequence of events and the information that came to light after York Region had entered into an agreement with Ontario to waive its costs despite the result of its application, we are of the opinion that York Region should no longer be held to its original agreement to waive its costs. As a result of Ontario’s conduct, York Region has been put to considerable unnecessary expense in pursuing a resolution of this issue and, at the same time, it has been forced to put on hold all steps required to proceed with a plan to address its wastewater needs. Ontario’s reprehensible and unexplained delay in the making of a decision for over 6 years beyond the legislated time period for doing so, its ultimate failure to make any such decision pursuant to applicable legislation, and its precipitous and covert action to bypass the usual environmental assessment process for actually determining the issue amounts to especially egregious conduct which we find to be worthy of sanction by means of an award to York Region of its full indemnity costs (see: Net Connect Installation Inc. v. Mobile Zone Inc., 2017 ONCA 766 (Ont. C. A.); Davies v. Clarington (Municipality), 2023 ONCA 367 (Ont. C.A.). Although we are confident that the parties will be able to reach agreement on the amount of payment that results from that order, we remain available to fix an amount if such agreement cannot be achieved.
. Tewari v. McIntyre

In Tewari v. McIntyre (Ont CA, 2023) the Court of Appeal considered grounds upon which civil costs may be awarded on a substantial indemnity basis:
[16] For these reasons, both the fresh evidence motion and the appeal are dismissed. Costs on an all-inclusive basis of $99,000 are ordered in favour of the respondents and $32,000 to Mr. Gibney. The costs are awarded on a substantial indemnity basis as a result of Mr. Tewari’s ongoing unfounded allegations about the respondents and Mr. Gibney.
. More v. 1362279 Ontario Ltd. (Seiko Homes)

In More v. 1362279 Ontario Ltd. (Seiko Homes) (Ont CA, 2023) the Court of Appeal considered the distinction between partial and substantial indemnity costs:
[31] The reasons of the motion judge as to costs are brief. Costs are typically payable on a partial indemnity basis unless there are circumstances that justify a higher scale of costs, such as where there has been reprehensible, scandalous or outrageous conduct on the part of one of the parties: see Davies v. Clarington (Municipality), 2009 ONCA 722, 100 O.R. (3d) 66, at paras. 29-30; Standard Life Assurance Company v. Elliott (2007), 2007 CanLII 18579 (ON SC), 86 O.R. (3d) 221, at para. 9; Osmani v. Universal Structural Restorations Ltd. et al., 2023 ONSC 1041, at para. 9; and Best v. Lancaster, 2015 ONSC 6269, at para. 142.
. D.L. v. E.C.

In D.L. v. E.C. (Ont CA, 2023) the Court of Appeal considered the standard for 'substantial imdemnity' costs:
[19] As the application judge rightly noted, costs on the elevated scale of substantial indemnity costs may only be warranted where a claimant’s success surpasses an offer to settle (inapplicable here) or a party engages in egregious conduct: Iannarella v. Corbett, 2015 ONCA 110, 124 O.R. (3d) 523, at para. 139; 1588444 Ontario Ltd. v. State Farm Fire and Casualty Company, 2017 ONCA 42, 135 O.R. (3d) 681, at para. 53. Such egregious conduct includes “misconduct by a party or its counsel, or where the proceedings are clearly vexatious, frivolous, or an abuse of process”: Lewis v. Lewis, 2017 ONCA 690, 49 E.T.R. (4th) 175, at para. 17. The application judge concluded that such costs were warranted because he determined that E.C. and her mother had “engaged in behaviour worthy of sanction” by advancing “a false narrative”.
. Canada v. Bowker

In Canada v. Bowker (Fed CA, 2023) the Federal Court of Appeal considered a Crown appeal from a Tax Court cost award. In this quote the court lists three levels of cost award - partial indemnity, substantial indemnity or full indemnity:
[19] The Court then considered the basis upon which lump sum costs, that is, partial indemnity, substantial indemnity or full indemnity, could be awarded. The Court quoted three legal texts dealing with costs. It cited Mark M. Orkin & Robert G. Schipper, The Law of Costs, 2nd ed. (Toronto, Ontario: Thomson Reuters, 1987) (loose-leaf updated October 2021, release 6) (Orkin) for the proposition “that the traditional degree of indemnification of party-to-party costs has been between 50% and 75% of solicitor-client costs or substantial indemnity costs”: Decision at para. 28. The Court acknowledged that there was no binding authority that costs should be awarded in that range. It also commented that this proposition was not universally accepted and that according to another text – Janet Walker & Lorne Mitchell Sossin, Civil Litigation (Toronto, Ontario: Irwin Law, 2010), traditionally partial indemnity costs fall closer to 50% while according to another text – Linda S. Abrams & Kevin Patrick McGuinness, Canadian Civil Procedure Law, 2nd ed. (Markham, Ontario: LexisNexis Canada, 2010), the range of partial indemnity in the Ontario courts falls between 40% and 60% of solicitor-client costs: Decision at para. 28. It can be seen from this that there is no consensus in the field as to the breadth of the range, particularly at the upper end.


[26] Beyond this, the summary of the Tax Court’s reasoning on the appropriate range makes it clear that the ranges it considered were not specific to the Tax Court, nor were they consistent. The Court considered three legal texts that set out different ranges. The Court acknowledged that the range it preferred, that set out in Orkin, was not unanimously accepted and cited a number of Tax Court cases that awarded costs that fell outside that range: Paletta Estate v. The Queen, 2021 TCC 41, 2021 D.T.C. 1032 (45%), Damis Properties Inc. v. The Queen, 2021 TCC 44, 2021 D.T.C. 1038 [Damis] (35%), Cameco Corporation v. The Queen, 2019 TCC 92, 2019 D.T.C. 1066 (35%), CIT Group Securities (Canada) Inc. v. The Queen, 2017 TCC 86, 2017 D.T.C. 1050 (36%), Invesco Canada Ltd. v. R., 2015 TCC 92, [2015] G.S.T.C. 52 (40%), Klemen v. R., 2014 TCC 369, 2015 D.T.C. 1040 (30%).
. Everest Finance Corporation v. Jonker

In Everest Finance Corporation v. Jonker (Ont CA, 2023) the Court of Appeal holds that 'full indemnity' contractual litigation costs, here in a mortgage context, will be ordered:
[3] We do not see any basis to deny the appellant its full indemnity costs. That is the relief that the respondents agreed to when they signed the mortgage. Contractual provisions stipulating entitlement of a mortgagee to costs of enforcement on the basis of costs actually expended will generally be enforced, absent misconduct or unfairness on the part of the party claiming costs: MCAP Financial Corp. v. George Fernicola in Trust and Carrington Homes Ltd., 2010 ONSC 148, at para. 18.
. Covenoho v. HomeLife Response Realty Inc.

In Covenoho v. HomeLife Response Realty Inc. (Div Court, 2023) the Divisional Court commented on the unusual circumstances in which substantial indemnity costs are awarded:
[14] While Right at Home has set out its costs both on a partial and a substantial indemnity basis, no real argument was made that substantial indemnity costs were appropriate in this case. Rule 49 does not apply in this case. Therefore, substantial indemnity costs should not be awarded except in rare and exceptional circumstances. Jassal v. Kaith, 2020 ONSC 3257. Generally, substantial indemnity costs are only awarded where a party has behaved in an abusive, egregious or otherwise reprehensible manner. Skourtis v. City of Toronto, 2021 ONSC 4492 at para. 7.
. Hutton v. Sayat

In Hutton v. Sayat (Fed CA, 2022) the Federal Court of Appeal cited a prior court definition of solicitor-client costs:
[5] For this particular file though, pursuant to the Court’s Order dated April 27, 2021, the Respondent’s costs should be assessed at the solicitor and client level. In Ontario Federation of Anglers and Hunters v. Ontario (Minister of Natural Resources and Forestry), [2017] S.C.C.A. No. 369, at paragraphs 7 and 8, the Registrar at the Supreme Court of Canada, provided clarification on the meaning of solicitor and client costs:
7. I note that the WTFN have based their claim on full indemnity. They state that "in taxing the award to them of costs on a solicitor-client basis on each file, the result should be that they be fully indemnified for their proper fees and disbursements". With respect, that is incorrect. Solicitor and client costs are not equivalent to full indemnification. As the Deputy Registrar noted in Richard:
The awarding of costs on a solicitor and client basis is something less than "solicitor and his own client costs" or full indemnity (see Orkin, at pp. 1-7 to 1-8). It is clear from the appellant's Bill of Costs, as supported by the time dockets attached as Annex 2, that the appellant's claim is for full indemnity. This is improper. [Emphasis added.]
8. The case law is settled that costs awarded on a solicitor and client scale shall be assessed on the basis of quantum meruit: see Mark Orkin, The Law of Costs, loose leaf, Vol. 1, at pp.1-13 to 1-14. See also, Richard, Best, Metzner v. Metzner, (reasons of the Registrar on Taxation dated June 15, 2001; S.C.C. Bulletin, 2001, p. 1159) and Alberta (Human Rights and Citizenship Commission) v. Brewer (reasons of the Registrar on Taxation dated August 25, 2009; S.C.C. Bulletin, 2010, p. 224). A non-exhaustive list of criteria set out in Cohen v. Kealy & Blaney (1985), 26 C.P.C. (2d) 211 (Ont. C.A.), cited with approval by this Court in Bhatnager v. Canada (Minister of Employment and Immigration), 1991 CanLII 41 (SCC), [1991] 3 S.C.R. 317, constitutes the framework within which quantum meruit should be gauged: see also, Orkin, Vol. 1, at pp. 3-54.1 to 3-54.2, as well as Brewer, Richard and Best.

[Emphasis was added in the original decision.]
. Bayford v. Boese

In Bayford v. Boese (Ont CA, 2021) the Court of Appeal considered when full indemnity costs, and opposed to substantial indemnity costs, should be awarded:
[4] We accept that a finding of fraud, or attempted fraud, may justify an award of costs on an elevated scale. Such a finding would be subsumed in the principle that costs on a substantial indemnity basis may be awarded "where there has been reprehensible, scandalous or outrageous conduct on the part of one of the parties": Young v. Young, 1993 CanLII 34 (SCC), [1993] 4 S.C.R. 3, at p. 134; Mars Canada Inc. v. Bemco Cash & Carry Inc., 2018 ONCA 239, 140 O.R. (3d) 81, at para. 43.

[5] On that point, however, we would reiterate the note of caution expressed in Net Connect Installation Inc. v. Mobile Zone Inc., 2017 ONCA 766, 140 O.R. (3d) 77, at para. 8, that there is a significant and important distinction between full indemnity costs and substantial indemnity costs. This court added:
Substantial indemnity costs is the elevated scale of costs normally resorted to when the court wishes to express its disapproval of the conduct of a party to the litigation. It follows that conduct worthy of sanction would have to be especially egregious to justify the highest scale of full indemnity costs.
[6] This principle, though, will normally apply to the trial proceedings, not to the appeal proceedings. There was no conduct by either party on the appeal that would fall within the above principle. Any finding regarding the conduct of the respondent, and its proper effect on costs, is thus a matter for the trial judge to consider when she assesses the costs of the proceedings below.
. Fuhgeh v. Stewart

In Fuhgeh v. Stewart (Div Ct, 2021) the Divisional Court set out the standard for full indemnity costs:
[12] The Intervenors request full indemnity costs. In Net Connect Installation Inc. v. Mobile Zone Inc., 2017 ONCA 766, the Court of Appeal for Ontario, at para. 8, cautioned:
There is a significant and important distinction between full indemnity costs and substantial indemnity costs. An award of costs on an elevated scale is justified in only very narrow circumstances – where an offer to settle is engaged or where the losing party has engaged in behaviour worthy of sanction: Davies v. Clarington (Municipality) [citations omitted] at para. 28. Substantial indemnity costs is the elevated scale of costs normally resorted to when the court wishes to express its disapproval of the conduct of a party to the litigation. It follows that conduct worthy of sanction would have to be especially egregious to justify the highest scale of full indemnity costs.
. T.A.W. v. J.C.L.

In T.A.W. v. J.C.L. (Ont CA, 2021) the Court of Appeal set out the standard for a substantial indemnity costs award:
[4] Costs on a substantial indemnity basis “are generally awarded only where there has been reprehensible, scandalous or outrageous conduct on the part of one of the parties”: Young v. Young, 1993 CanLII 34 (SCC), [1993] 4 S.C.R. 3, at p. 134; Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, [2004] 1 S.C.R. 303, at para. 26. Notably, the motion judge awarded costs on a substantial indemnity basis, because the appellant’s statement of claim was “offensive” and constituted a “misogynistic attack” on the respondent. We agree with that observation.

[5] The appellant argues that his appeal to this court did not include any discriminatory reasoning. He also submits that the mere fact of bringing an appeal does not constitute a continuation of the conduct below. We do not accept this position.

[6] Among other things, the appellant’s continuing conduct on appeal includes his reference to the respondent as engaging in a “repeated pattern of deceitful, manipulative and predatory behaviour in her relationships with three other men”. Moreover, as the Supreme Court of Canada indicated in Hamilton, at para. 26, “allegations of fraud and dishonesty are serious and potentially very damaging to those accused of deception.” Here, the appellant attempted to revitalize his claim of fraudulent misrepresentation against the respondent, one that constitutes a continuing unacceptable attack on her integrity and dignity.


The author has waived all copyright and related or neighboring rights to this Isthatlegal.ca webpage.

Last modified: 14-03-24
By: admin