Letourneau v. Clearbrook Iron Works Ltd., 2004 FC 1626

Date: 20041119

Docket: T-1864-00

Citation: 2004 FC 1626

BETWEEN:

                                                      JOHN LETOURNEAU and

                                                 LETOURNEAU LIFE RAIL LTD.

                                                                                                                                            Plaintiffs

                                                                                                   (Defendants by Counterclaim)

                                                                           and

                                             CLEARBROOK IRON WORKS LTD.

                                                                                                                                        Defendant

                                                                                                           (Plaintiff by Counterclaim)

REASONS FOR ORDER

HARGRAVE P.

[1]                 These reasons arise out of submissions, during a case management conference, as to costs on motions by each side, dealing with discoveries, dealt with in an Order and Reasons of 14 October 2004, presently under appeal.

[2]                 Success on the motions was, to a substantial degree, mixed. While recognising that at least one of the motions was perhaps needed to invoke voluntary responses at an early date and that bifurcation of the action made some discoveries requests unnecessary, I am also aware that a mathematical tally of won and lost points on a motion is not determinative in assessing success. A further factor which perhaps clouds the issue of provision of answers was that settlement discussions did take place from time to time.         

[3]                 In exercising my discretion in favour of ordering costs in the cause on both motions I have not overlooked the current state of the Federal Court Rules and of the case law.

[4]                 Up until the 1998 amendments to the Federal Court Rules the accepted principle as to costs on interlocutory motions was that set out in Mayflower Transit Ltd. v. Marine Atlantic Inc. (1989), 29 F.T.R. 30 (F.C.T.D.). That principle was that costs on interlocutory motions should be costs in the cause. The principle was further bolstered by the view of Mr Justice Strayer, as he then was, in Toronto-Dominion Bank v. Canada Trustco Mortgage Co., the pertinent reasons being those reported (1991), 50 F.T.R. 317 (F.C.T.D.) at 318: the view was that on an interlocutory motion costs should be in the cause, regardless of success. This whole concept was based upon the idea that, until an action was finally decided, to award costs on an interlocutory basis could penalize the party who ultimately succeeded.

[5]                 The Federal Court Rules as amended in 1998 changed all of this. Very shortly after the Rules came into effect Mr Justice Rothstein, as he then was, decided AIC Ltd. v. Infinity Investment Counsel Ltd. (1998), 148 F.T.R. 240 (F.C.T.D.) In that case he considered the law up until the 1998 amendments, and looked at the case law and the trend in Ontario toward interlocutory costs as payable forthwith, thus serving the salutary objectives of expediting matters and focusing the minds of the litigants on the ongoing costs of the litigation. Mr Justice Rothstein determined that the earlier cases, Toronto-Dominion Bank (supra) and Thurston Hayes Developments Ltd. v. Horn Abbot Ltd. (1985), 5 C.P.R. (3d) 124 (F.C.A.) were no longer good law in view of amended Rule 401, with the application of Rule 401(1) requiring discretion. As I say, he was guided by the Ontario cases which looked upon the awarding of the costs of a motion as aimed at expedition of the litigation and a means by which to focus the minds of the litigants on the cost of litigation (page 243).

[6]                 The Court of Appeal approved of Infinity Investment Council Ltd. in Enterprise Rent-A-Car Co. v. Singer, an unreported 10 September 1999 decision, filed A-345-98, [1999] FCJ No. 1687 (QL). The Court of Appeal held that the Federal Court had the discretion to award costs of interlocutory motions to either party, regardless of the outcome of the main action, because new Rule 401(1) displaced Toronto-Dominion Bank.

[7]                 As I read Infinity Investment (supra) and Enterprise Rent-A-Car (supra), those cases and Rule 401 do not, except in an instance in which a motion ought not to have been brought, force me to award costs to either party, but allow me to award costs in the cause, so long as I exercise my discretion on a proper basis, not merely, as in Toronto-Dominion Bank (supra), on the basis that to award costs on interlocutory motion would be pre-mature.

[8]                 In the present instance I considered whether to award costs on either motion, or to award no costs at all. However, in order to focus the minds of the litigants on the potential costs of this litigation, it is appropriate to award costs in the cause.

[9]                 The costs both of the two motions dealing with discoveries, decided 14 October 2004 and of the continuation of that motion to date, as to costs, will be costs in the cause.

(Sgd.) "John A. Hargrave"

                                                                                          Prothonotary

Vancouver, British Columbia

19 November 2004

                                                             FEDERAL COURT

                           NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET:                                         T-1864-00

STYLE OF CAUSE:                       John Letourneau et al. v. Clearbrook Iron Works Ltd.

PLACE OF HEARING:                  Vancouver, British Columbia

DATE OF HEARING:                     18 November 2004

REASONS FOR ORDER:            Hargrave P.

DATED:                                           19 November 2004

APPEARANCES:                         

SOLICITORS OF RECORD: