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Monday Morning Case Bites for September 23, 2019

Last Week’s Court Rulings from the Alberta Court of Queen’s Bench, Court of Appeal and SCC.

Edited by Amanda Kostek & Christie Dewar

Cole v Martin-Morrison, 2019 ABQB 730
Costs | Summary Judgment

Ring v Trikezone Ltd, 2019 ABQB 719
Costs | Summary Dismissal | Out of Province Counsel

Pembina Pipeline Corporation v Coney, 2019 ABQB 699
Questioning | Limit on number of employees to be examined

Cole v Martin-Morrison, 2019 ABQB 730

This was a decision on costs following the Plaintiff’s unsuccessful summary judgment application. The Plaintiff argued that costs should be deferred to the conclusion of the matter. The Court disagreed on the following basis:

[7]               All applications force parties to expend resources to respond to them. This application was no different, and a significant response was provided. Responding to an application is not a trivial matter, and it can involve the marshalling of substantial resources given that responding parties must always remember the “best foot forward” principal. The plaintiffs’ application compelled a response here. The plaintiffs were ultimately unsuccessful in their summary judgement application. While costs may sometimes be deferred on “near misses”, or in circumstances where the failed summary judgment application narrowed the issues between the parties, none of that is present here.

[8]               At paragraph 6 in Hryniak the Supreme Court of Canada recognized:

As the Court of Appeal observed, the inappropriate use of summary judgment motions creates its own costs and delays.  However, judges can mitigate such risks by making use of their powers to manage and focus the process and, where possible, remain seized of the proceedings.

[9]               I find that in accordance with Rule 10.29, the resisting defendants are each entitled to costs in resisting the unsuccessful summary judgement application.

The Court also made changes to the Bills of Costs, and directed that the Bills of Costs should not include tariff items for regular Questioning because it is not specifically for the summary judgment application, but for the action as a whole:

[12]           In reviewing the two Bills of Costs, I observe that claims in both of them are made for Part 5 questioning. I would direct that those amounts be removed from both Bills of Costs. While there may have been reference to extracts from Part 5 questioning at the application, Part 5 questioning serves the larger purpose of questioning in the action generally. It is not a part of the summary judgement application in itself unless the summary judgment application concludes the action. It would be ironic if the defendants receive a Part 5 questioning award now and the plaintiffs receive one at the end of the action if they are successful. An award for Part 5 questioning should only happen once. All claims for Part 5 questioning should be removed from both Bills of Costs for the summary judgment application.

Where there is Questioning on an Affidavit, that can be claimed in the Bill of Costs.  However, in this case, the transcripts generated were short, so the Court reduced the amount claimed:

[13]           With respect to claims for Part 6 questioning, there were multiple affidavits filed on behalf of the plaintiffs, many of which were very similar. Accordingly, some of the questioning and preparation became simplified. Given the similarities between the affidavits and the issues raised, in most cases the transcripts that were generated were short. Accordingly, I find that some downward adjustment is warranted on the Part 6 questioning to reflect some of the economies of what transpired. I direct that any claims for Part 6 questioning of the plaintiffs on their affidavits be allowed, but in the reduced amount of 50% of what would otherwise be provided under Schedule C. Part 6 questioning of the defendants on their own affidavits, however, is allowed at the normal rates under Schedule C. All of that is subject to adjustment based on Item 5(3) in Schedule C if there were any sessions where counsel was a mere observer and not a participant by either conducting the examination, or acting for the person being examined.

Finally, the Court noted that although the Statement of Claim included numbers close to engaging Column 5 tariff amounts, the application was clearly about numbers that fell within Column 4.  On that basis the Court directed that Costs should be assessed in Column 4:

[14]           The draft Bills of Costs are prepared under Column 5. I find that Column 4 is the appropriate column. The plaintiffs collectively included their individual claims in an amount that engaged Column 4 and sought summary judgment for an amount that was well within Column 4. While the Statement of Claim numbers come close to engaging Column 5, the summary judgment application was clearly about Column 4 amounts.

Ring v Trikezone Ltd, 2019 ABQB 719

This was a decision on costs following an unsuccessful summary dismissal application. The Plaintiff argued that their use of Ontario counsel kept costs down because the Plaintiff lived in Ontario. Their proposed costs were based on 40-50% of their solicitor client costs, which included travel from Ontario for the Application. The Court rejected this proposal on the following basis:

[6] As a starting point, this is not the type of application that attracts solicitor-client costs, rather it is the type of application that attracts party-party costs. The question is whether there are any factors that persuade me that there should be enhanced costs.

[7] There are not.

[8] I do not find it reasonable for Ontario Counsel to be involved in a Summary Dismissal application when there are many experienced Alberta Counsel available. Indeed, it appears that a local Edmonton law firm was consulted and perhaps retained at one point. The use of Ontario Counsel is a solicitor-client cost, not a party-party cost. The only costs I am addressing today are those related to the Summary Dismissal application. I leave it open to the trial justice to determine if it is reasonable for Ontario Counsel to be engaged for the overall action.

[9] Furthermore, there is no evidence of misconduct or abuse of process which would elevate costs above party-party costs.

[10] I accept the calculation of costs under column 5 of Schedule C at $8,000 all inclusive as suggested by Defence counsel. I also accept the suggestion of Defence Counsel that it be awarded the sum of $500 for the submissions on costs. The direction of the Court is that the Plaintiff is entitled to its costs for successfully opposing the Summary Dismissal application in the amount of $8,000 all inclusive, less the $500 awarded to the Defendant for the submissions on costs, for a total net cost award of $7,500 payable to the Plaintiff within 30 days of the date of this costs decision.

Pembina Pipeline Corporation v Coney, 2019 ABQB 699

This was an application to limit the number of a party’s former employees to be examined. The Court set out the following general rules:

[12]           While the Alberta Rules of Court do not expressly limit the number of corporate witnesses an adverse party may question, Rule 5.19(a) allows the Court to limit the number.

[13]           As noted in Patel v Patel, 2011 ABQB 662 (CanLII) at para 38, the foundational Rules deal with fairness, justice, efficiency, economy and proportionality. As a result, the Court noted at para 43 that:

ermitting a party to avail him or herself of every step contemplated by the rules where there in no likelihood that the outcome of such steps will ultimately assist in resolving the matters, or where the potential benefits are disproportional to the efficiency and expense involved, is contrary to the purpose and intent of the rules.

[14]           The scope of questioning for discovery has been narrowed in the Rules from what is “relevant” to what is “relevant and material”. The Court of Appeal has cautioned, however, that:

[a]t an interlocutory stage of proceedings, the Court should not measure counsels’ proposed line of argument too finely; if counsel can disclose a rational strategy in which the disputed document plays a material part, that should be sufficient. Again it must be remembered that the purpose of the Rule was to avoid abusive, excessive, and unnecessarily expensive discovery, not to cut off legitimate line of inquiry: Weatherill Estate v Weatherill, 2003 ABQB 69 (CanLII), at paras 15-16.

[15]           Thus, the issue for the Court to grapple with is where to draw the line between legitimate and necessary questioning and questioning that is merely “fishing” for evidence without a reasonable basis or that has been proposed for illegitimate strategic reasons.

[16]           During questioning, a person is only required to answer relevant and material questions. A question is relevant and material only if the answer to that question could reasonably be expected either:

a)    to significantly help determine one or more of the issues raised in the pleadings, or

b)    to ascertain evidence that could reasonably be expected to significantly help determine one or more of the issues raised in the pleadings: Rules 5.2(1) and Rule 5.25 (1)(a).

[17]           Relevance is primarily determined with reference to the pleadings, while materiality relates to whether the information can help prove a fact in issue: Dow Chemical Canada Inc v Nova Chemicals Corp, 2014 ABCA 244 (CanLII) at para 17.

[18]           As noted at paras 19 and 21 of Dow Chemical, a case management judge is entitled to reject lines of pre-trial discovery that are unrealistic, speculative or without any air of reality, or where the expense involved is disproportionate to the likely benefits that will result. The same reasoning applies to requests to question witnesses generally.

After considering the specific circumstances of each witness, the Court directed that the four proposed employees need not be examined, because the Questioning party had not established that they had any material and relevant information on the issues in the action:

[47]           For the reasons set out herein, I find that Coney’s proposed questioning of Mr Buchan, Mr Smith, Mr Zorniak and Mr Dilger cannot be justified, as Coney has not established that these proposed witnesses have any material and relevant information on the issues in this litigation. I therefore grant Pembina’s application. If the parties are unable to agree on costs, they may make further submissions on that issue.