A SHIFTING APPROACH TO COSTS

Another case from an experienced Ontario Court judge is interesting on the question of costs. Robert Spence, J. finds that the often-cited case of Biant v. Sagoo, 2001 ONSC 28137, (CAN LII), has been disapproved by the Court of Appeal in the more recent case of Beaver v. Hill 2018 ONCA 840 (CAN LII). He is critical of counsel for not bringing this to the Court’s attention.

In Biant v. Sagoo, the Court held that costs should generally approach full recovery as long as the successful party has behaved reasonably, and the costs claimed are proportional to the issue(s). In Beaver v. Hill, the Court of Appeal examined Rule 24 (the costs rule) and determined that there is nothing in its wording which provides for a general approach that is “close to full recovery”. Full recovery might be consistent with besting an offer or bad faith, but, otherwise, “proportionality and reasonableness” are the important considerations.

I am not sure the two cases are that radically different, but it appears there is a shift away from “approaching full recovery” unless conduct is egregious or an offer “bests the result”. This will likely mean that in most cases a litigant, forced to sue to obtain reasonable relief, will continue to be out-of-pocket even if that litigant enjoys success. For sure, there is always a chance that the offer will beat the court result, but that could mean that the offer, if accepted, could be less than reasonable.