Docket:
T-1540-15
Citation:
2016 FC 1133
Ottawa, Ontario, October 14, 2016
PRESENT: The Honourable Mr. Justice Fothergill
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BETWEEN:
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ITKA DALFEN
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Plaintiff
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and
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BANK OF
MONTREAL
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Defendant
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ORDER AND REASONS
[1]
On July 25, 2016, this Court granted the Bank of
Montreal’s motion to strike Itka Dalfen’s amended statement of claim pursuant
to Rule 221 of the Federal Courts Rules, SOR/98-106 (Dalfen v Bank of
Montreal, 2016 FC 869). The Court permitted the parties to file written submissions
on costs within thirty days. Both parties filed their submissions on August 24,
2016.
[2]
The brief procedural history of this proposed
class action may be summarized as follows: Ms. Dalfen filed a statement of
claim on September 14, 2015 naming the Bank of Montreal and Her Majesty the
Queen as defendants. On March 8, 2016, Ms. Dalfen filed an amended statement of
claim. On March 16, 2016, the Bank of Montreal moved for an order to strike the
amended statement of claim. On March 18, 2016, the Court granted Ms. Dalfen leave
to discontinue her claim as against the Crown. On July 25, 2016, the Court
granted the Bank of Montreal’s motion to strike Ms. Dalfen’s amended statement
of claim.
[3]
The Bank of Montreal was successful in its
motion to strike Ms. Dalfen’s amended statement of claim and should, in the
normal course, be entitled to costs (Paradis Honey Ltd. v Canada (Attorney
General), 2014 FC 215 at para 122). Despite the relatively short duration
of this proceeding, the Bank of Montreal claims to have incurred costs in the
amount of $108,000.00. The Bank of Montreal seeks to be indemnified for all of
these costs on a solicitor-client basis. In the alternative, the Bank of
Montreal seeks $65,000.00 in costs, which it says is comparable to the
party-party costs that would be awarded in the Ontario Superior Court of
Justice. The Bank of Montreal has not provided a draft Bill of Costs or any
supporting evidence to justify its extraordinary request for costs.
[4]
Ms. Dalfen argues that no costs should be
awarded to the Bank of Montreal, because (a) the proposed class action
potentially benefited numerous customers of the Bank, not just Ms. Dalfen;
(b) Ms. Dalfen’s pecuniary interest pales in comparison to that of the proposed
class as a whole; (c) the legal issues were novel; (d) the Bank of Montreal is
in a superior position to absorb costs; and (e) Ms. Dalfen encouraged the
efficient determination of the jurisdictional question by written motion
without evidence, cross-examination or court appearance.
[5]
The awarding of costs, including the quantum, is
a matter falling within the Court’s discretion (Rule 400(1); Canada
(Attorney General) v Rapiscan Systems Inc, 2015 FCA 97 at para 10). In
determining an award of costs, the Court is guided by the considerations found
in Rule 400(3). The considerations that are potentially relevant in this case
include the following:
•
the result of the proceeding;
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the importance and complexity of the issues;
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any written offer to settle;
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the amount of work;
•
whether the public interest in having the
proceeding litigated justifies a particular award of costs; and
•
any conduct of a party that tended to shorten or
unnecessarily lengthen the duration of the proceeding.
[6]
An award of costs on a solicitor-client basis is
made only in rare circumstances, including where a party has displayed
reprehensible, scandalous or outrageous conduct (Quebec (Attorney General) v
Lacombe, 2010 SCC 38 at para 67). Absent special considerations, costs should
generally fall within Tariff B of the Rules (Wihksne v Canada (Attorney
General), 2002 FCA 356 at para 11; Dimplex North America Limited v CFM
Corporation, 2006 FC 1403 at paras 8-12, aff’d 2007 FCA 278).
[7]
The Bank of Montreal has failed to demonstrate
that any conduct on the part of Ms. Dalfen was reprehensible, scandalous
or outrageous. Nor has the Bank of Montreal advanced any special considerations
that would warrant a departure from the usual Tariff amounts.
[8]
Recent costs awards following a successful
motion to strike a statement of claim at a preliminary stage suggest a usual range
of $500.00 to $2,500.00 (see, for example, Bouchard v Canada, 2016 FC
983; Dickson v Canada, 2016 FC 836; Olumide v Canada, 2016 FC
558). Even in cases where elevated costs have been awarded to reprimand an
unsuccessful party for inappropriate conduct, the awards have been
comparatively modest. In Thompson Bey v Kershman, 2016 FC 1093,
Prothonotary Tabib struck the plaintiff’s statement of claim on the grounds
that it was vexatious, scandalous, frivolous and an abuse of process, and
ordered costs in the amount of $5,000.00. In Shebib v Canada, 2016 FC
539, Justice Hughes awarded $5,000.00 to each group of defendants in a case
where he found that the plaintiffs had been careless, and even reckless, in the
naming of defendants.
[9]
Applying the relevant considerations found in
Rule 400(3) to this case, the Bank of Montreal has been wholly successful in
its motion to strike Ms. Dalfen’s statement of claim. The issues were of
moderate complexity. While the case potentially transcended the interests of
Ms. Dalfen alone, its merits were doubtful and the public interest
component was correspondingly weak. The Bank of Montreal offered to settle the
matter only by permitting discontinuance without costs. The amount of work was
modest. Ms. Dalfen’s estimate of costs on a substantial indemnity basis in the
approximate amount of $5,000.00 is considerably more reasonable than the Bank
of Montreal’s estimate of more than $100,000.00. The conduct of the parties is
a neutral factor.
[10]
Having regard to the foregoing, and considering
prior decisions of this Court in comparable cases, costs are awarded to the
Bank of Montreal in the lump sum amount of $2,000.00.
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