321665 Alberta Ltd. v. ExxonMobil Canada Ltd., (2013) 561 A.R. 37

• Judge: Martin, Watson and McDonald, JJ.A.
• Court: Court of Appeal (Alberta)
• Case Date: August 23, 2013
• Citations: (2013), 561 A.R. 37;2013 ABCA 326

321665 Alta. v. ExxonMobil Can. (2013), 561 A.R. 37; 594 W.A.C. 37 (CA)

MLB headnote and full text

Temp. Cite: [2013] A.R. TBEd. SE.091

321665 Alberta Ltd. (respondent/appellant by cross-appeal/plaintiff) v. Husky Oil Operations Ltd. (appellant/respondent by cross-appeal/defendant) and ExxonMobil Canada Ltd. formerly known as Mobil Oil Canada Ltd. (appellant/respondent by cross-appeal/defendant)

(1203-0086-AC; 1203-0087-AC; 2013 ABCA 326)

Indexed As: 321665 Alberta Ltd. v. ExxonMobil Canada Ltd.

Alberta Court of Appeal

Martin, Watson and McDonald, JJ.A.

September 25, 2013.

Summary:

The plaintiff sued the defendants (Mobil Oil Canada Ltd. and Husky Oil Operations Ltd., now known as ExxonMobil Canada Ltd.) in 1997, alleging a breach of s. 45 of the Competition Act and the torts of conspiracy, interference with economic interests and interference with business relations. The plaintiff brought a case management application seeking leave to make several amendments to its statement of claim.

The Alberta Court of Queen's Bench, in a decision reported at 507 A.R. 140, allowed the application in part. The matter proceeded to trial.

The Alberta Court of Queen's Bench, in a decision reported at 525 A.R. 238, allowed the action and awarded the plaintiff damages at large of $5,000,000 together with punitive damages against each defendant of $500,000. The parties made submissions respecting pre-judgment interest and costs.

The Alberta Court of Queen's Bench, in a decision reported at 529 A.R. 276, awarded the plaintiff simple pre-judgment interest on the award of damages at large for the 12.5 year period commencing November 13, 1998 to May 27, 2011 calculated when the losses actually occurred, on a year to year basis. The plaintiff was entitled to recover Schedule C costs calculated on the basis of triple Column 5 including second counsel fee throughout. The plaintiff was entitled to recover investigation costs in the amount of $75,000 inclusive of disbursements. The defendants appealed.

The Alberta Court of Appeal, in a decision reported at 553 A.R. 293; 583 W.A.C. 293, allowed the appeal and dismissed the action. Alternatively, the court would have allowed the appeal as to damages and costs. The defendants sought costs.

The Alberta Court of Appeal held that the defendants were each entitled to a set of costs at triple column 5, with single counsel fees, subject to the effect of doubling provided for under Queen's Bench Rule 4.29(1) for the defendants' unaccepted settlement offer.

Practice - Topic 7028.9

Costs - Party and party costs - Entitlement to - Successful party - Exceptions - Constitutional issues (incl. Charter) - The Alberta Court of Appeal stated that "Okanagan Indian Band [2003 S.C.C.] points out that 'in highly exceptional cases involving matters of public importance the individual litigant who loses on the merits may not only be relieved of the harsh consequence of paying the other side's costs, but may actually have its own costs ordered to be paid by a successful intervenor or party'. But the examples of this largely appear to be cases (a) involving the Crown as the principal opponent of the litigant or (b) cases of statutory countermand of the general rule of indemnification and, in either situation, the issues rest on foundational or Constitutional questions. Reference to 'test cases' usually involve situations where the Crown initiated the proceeding. Even so, the Crown is not vulnerable to pay costs when it successfully defends merely because the plaintiffs against the Crown are acting in good faith ..." - See paragraph 26.

Practice - Topic 7029.5

Costs - Party and party costs - Entitlement - Successful party - Exceptions - Public interest or test case - [See Practice - Topic 7028.9 ].

Practice - Topic 7029.8

Costs - Party and party costs - Entitlement to party and party costs - Successful party - Exceptions - Situation of unsuccessful party - The Alberta Court of Appeal stated that "The entitlement of the successful litigant to costs can be limited or denied by statutory direction, or by legal principles such as relate to misconduct of that party, miscarriage in the procedure, or oppressive and vexatious conduct of the proceedings by that party ... [T]he sort of special and peculiar circumstances that may raise a question of injustice would not arise merely from the fact that the winner is better able to carry the costs than the loser." - See paragraphs 24 and 25.

Practice - Topic 7029.8

Costs - Party and party costs - Entitlement to party and party costs - Successful party - Exceptions - Situation of unsuccessful party - The plaintiff successfully sued the defendants alleging a breach of s. 45 of the Competition Act and the torts of conspiracy, interference with economic interests and interference with business relations - The defendants were successful on appeal - They sought costs - The plaintiff/respondent on appeal argued that, despite its lack of success, it should be awarded costs based on s. 36 of the Competition Act ("Recovery of damages") - The Alberta Court of Appeal stated that "... the language of s. 36 does not establish a 'one-way' costs regime. Even in light of the legislative history provided for the respondent, it is apparent that the ability to award enhanced costs under s. 36 is aimed at parties who successfully invoke the Competition Act. We were not pointed to any language there which suggests costs immunity merely because a party alleges a breach of that Act. And, as noted above, the justification for making a successful party pay costs, or to deny a successful party their entitlement to costs must be based in principle ..." - See paragraph 27.

Practice - Topic 7035.1

Costs - Party and party costs - Entitlement to - Against the Crown or governmental bodies - [See Practice - Topic 7028.9 ].

Practice - Topic 7040

Costs - Party and party costs - Entitlement to - Unsuccessful party - [See Practice - Topic 7028.9 and second Practice - Topic 7029.8 ].

Practice - Topic 7061

Costs - Party and party costs - Counsel fees - Increased or decreased fee - [See Practice - Topic 7115 ].

Practice - Topic 7115

Costs - Party and party costs - Special orders - Increase in scale of costs - Difficulty and complexity of proceedings - The plaintiff successfully sued the defendants alleging a breach of s. 45 of the Competition Act and the torts of conspiracy, interference with economic interests and interference with business relations - The defendants were successful on appeal - They sought costs - The Alberta Court of Appeal stated that "Under the Rules, the applicable tariff and column on appeal should ordinarily match that which was selected at trial: see Rule 608 ... [T]he trial judge awarded triple column 5 and a second counsel fee to the respondent. We need not find whether there was a component intended by the trial judge in his costs award to reflect the policy in s. 36 of the Competition Act, RSC 1985, c. C-34 [Recovery of damages]. That is because the trial costs award was, arguably, justifiable within the scope of discretion of the trial judge in light of the quantum of the claim and the fact that the 'costs award would have been justified here simply on the basis of the complexity and duration of the ligation' ... The trial judge also awarded the respondent a second counsel fee for trial. Inasmuch as each defendant had a principal counsel on appeal, but their submissions were essentially in tune with one another, a correspondence in that regard as to appeal costs would be achieved by recognizing a single set of costs including a single counsel fee for each appellant on the appeal. ... We were not provided with a reason to take a different approach to the trial. Subject to the determination of the issues raised by the parties as to appeal costs, ... the appellants would therefore be each entitled to a set of costs at triple column 5, with counsel fees on that basis." - See paragraphs 2 and 3.

Practice - Topic 7118.1

Costs - Party and party costs - Special orders - Multiplier - [See Practice - Topic 7115 ].

Practice - Topic 7242.1

Costs - Party and party costs - Offers to settle - Grounds for denying double costs - [See Practice - Topic 7243 ].

Practice - Topic 7243

Costs - Party and party costs - Offers to settle - Effect of failure to accept - The plaintiff sued the defendants in 1997 alleging a breach of s. 45 of the Competition Act and for the torts of conspiracy, interference with economic interests and interference with business relations - The trial judge allowed the action and awarded the plaintiff damages at large of $5,000,000, together with $500,000 punitive damages against each defendant - The defendants were successful on appeal - They sought costs, including double costs based on an offer to settle - The plaintiff contended that the settlement offer was not "genuine" in that it was an offer that did not realistically reflect the relative merits of the parties' positions at the time it was made - The defendants had formally offered, using form 22 under rule 4.24, $100,000 inclusive of interest and costs in total satisfaction of the action - The plaintiff also argued that, even if the court was not persuaded that the offer was clearly not genuine, the entire topic should be sent back to the trial judge for evaluation and fact finding - The Alberta Court of Appeal held that the proposal was not derisory or abusive and the defendants were entitled to double costs based on their offer - See paragraphs 6, 13 to 17 and 32.

Trade Regulation - Topic 506

Competition - General - Civil remedy (Competition Act, s. 36) - [See Practice - Topic 7115 and second Practice - Topic 7029.8 ].

Cases Noticed:

Lavoie v. Wills (2002), 312 A.R. 373; 281 W.A.C. 373; 2002 ABCA 240, refd to. [para. 2].

Gerber v. Telus Corp. et al., [2004] A.R. Uned. 77; 27 Alta. L.R.(4th) 231; 2004 ABCA 162, refd to. [para. 2].

Indutech Canada Ltd. v. Gibbs Pipe Distributors Ltd. et al. (2013), 544 A.R. 205; 567 W.A.C. 205; 2013 ABCA 111, refd to. [para. 2].

Public School Boards Association (Alta.) et al. v. Alberta (Attorney General) et al. (1998), 216 A.R. 249; 175 W.A.C. 249; 1998 ABCA 238, refd to. [para. 5].

City National Leasing Ltd. v. General Motors of Canada Ltd., [1989] 1 S.C.R. 641; 93 N.R. 326; 32 O.A.C. 332, refd to. [para. 10].

Isfeld et al. v. Petersen Pontiac GMC (Alta.) Inc. et al. (2013), 556 A.R. 118; 584 W.A.C. 118; 2013 ABCA 251, refd to. [para. 11].

Nelson et al. v. 1153696 Alberta Ltd. (2010), 478 A.R. 257; 2010 ABQB 164, revd. (2011), 510 A.R. 153; 527 W.A.C. 153; 2011 ABCA 203, leave to appeal denied (2012), 435 N.R. 381; 536 A.R. 403; 559 W.A.C. 403 (S.C.C.), refd to. [para. 11].

Pauli et al. v. ACE INA Insurance Co. et al. (2004), 354 A.R. 348; 329 W.A.C. 348; 2004 ABCA 253, refd to. [para. 11].

R. v. Nova Scotia Pharmaceutical Society et al. (No. 2), [1992] 2 S.C.R. 606; 139 N.R. 241; 114 N.S.R.(2d) 91; 313 A.P.R. 91, refd to. [para. 12].

Kerr v. Kerr (2001), 293 A.R. 384; 257 W.A.C. 384; 2001 ABCA 152, refd to. [para. 14].

Blue Range Resource Corp., Re (2001), 281 A.R. 351; 248 W.A.C. 351; 2001 ABCA 177, refd to. [para. 14].

Petro-Canada Products Inc. v. Dresser-Rand Canada Inc., [2004] A.R. Uned. 315; 2004 ABCA 282, refd to. [para. 14].

Allen v. University Hospitals Board et al. (2006), 384 A.R. 23; 367 W.A.C. 23; 2006 ABCA 101, refd to. [para. 14].

Delta Hotels Ltd. v. Okabe Canada Investments Co. et al. (1992), 131 A.R. 118; 25 W.A.C. 118; 1992 ABCA 176, refd to. [para. 15].

Globex Foreign Exchange Corp. v. Kelcher et al. (2011), 513 A.R. 101; 530 W.A.C. 101; 2011 ABCA 240, refd to. [para. 15].

Hogarth et al. v. Rocky Mountain Slate Inc. et al., [2013] A.R. Uned. 90; 2013 ABCA 116, leave to appeal denied [2013] S.C.C.A. No. 160, refd to. [para. 16].

Miller (Ed) Sales & Rentals Ltd. v. Caterpillar Tractor Co. et al. (1998) 216 A.R. 304; 175 W.A.C. 304 (C.A.), refd to. [para. 16].

Clark v. TD Waterhouse Canada Inc. (2013), 544 A.R. 328; 567 W.A.C. 328; 2013 ABCA 123, leave to appeal denied [2013] S.C.C.A. No. 238, refd to. [para. 17].

Horizon Resource Management Ltd. et al. v. Blaze Energy Ltd. et al. (2013), 544 A.R. 289; 567 W.A.C. 289; 2013 ABCA 139, refd to. [para. 17].

Canada (Attorney General) v. Mowat, [2011] 3 S.C.R. 471; 422 N.R. 248; 2011 SCC 53, refd to. [para. 21].

British Columbia (Minister of Forests) v. Okanagan Indian Band et al., [2003] 3 S.C.R. 371; 313 N.R. 84; 189 B.C.A.C. 161; 309 W.A.C. 161; 2003 SCC 71, refd to. [para. 22].

Hamilton-Wentworth (Regional Municipality) v. Hamilton-Wentworth Save the Valley Committee Inc. et al. (1985), 11 O.A.C. 8; 51 O.R.(2d) 23 (Div. Ct.), refd to. [para. 23].

Day v. Karagianis et al. (2008), 276 Nfld. & P.E.I.R. 255; 846 A.P.R. 255; 2008 NLCA 32, leave to appeal denied (2008), 392 N.R. 388 (S.C.C.), refd to. [para. 24].

Mullins v. Levy et al. (2010), 282 B.C.A.C. 313; 476 W.A.C. 313; 2010 BCCA 83, affd. [2010] B.C.A.C. Uned. 58; 320 D.L.R.(4th) 752; 2010 BCCA 294, leave to appeal denied (2010), 416 N.R. 386; 307 B.C.A.C. 115; 519 W.A.C. 115 (S.C.C.), refd to. [para. 25].

Zimmer of Canada Ltd. v. British Columbia (2010), 282 B.C.A.C. 282; 476 W.A.C. 282; 2010 BCCA 64, refd to. [para. 26].

Deer Creek Energy Ltd. v. Paulson & Co. Inc. et al. (2009), 460 A.R. 180; 462 W.A.C. 180; 2009 ABCA 280, refd to. [para. 27].

Kretschmer v. Terrigno (2012), 539 A.R. 212; 561 W.A.C. 212; 2012 ABCA 345, refd to. [para. 27].

Ruffolo et al. v. Sun Life Assurance Co. of Canada (2009), 247 O.A.C. 209; 2009 ONCA 274, refd to. [para. 28].

Seidel v. Telus Communications Inc., [2009] B.C.A.C. Uned. 70; 75 C.P.C.(6th) 15; 2009 BCCA 383, revd. in part [2011] 1 S.C.R. 531; 412 N.R. 195; 301 B.C.A.C. 1; 510 W.A.C. 1; 2011 SCC 15, refd to. [para. 29].

Mahe et al. v. Boulianne, [2010] A.R. Uned. 25; 21 Alta. L.R.(5th) 277; 2010 ABCA 74, refd to. [para. 30].

Kerr et al. v. Danier Leather Inc. et al., [2007] 3 S.C.R. 331; 368 N.R. 204; 231 O.A.C. 348; 2007 SCC 44, appld. [para. 31].

Statutes Noticed:

Competition Act, R.S.C. 1985, c. C-34, sect. 36 [para. 2].

Rules of Court (Alta.), rule 608 [para. 2].

Authors and Works Noticed:

Orkin, Mark M., The Law of Costs (2nd Ed.) (2007 Looseleaf Supp.), vol. 1, pp. 2-78 to 2-80 [para. 24].

Counsel:

R.M. Mogerman, for the respondent/appellant by cross-appeal, 321665 Alberta Ltd.;

B. Zalmanowitz, Q.C., J.J. Patterson and R.F. Quinlan, for the appellant/respondent by cross-appeal, Husky Oil Operations Ltd.;

D.W. McGrath, Q.C., R.J. Hofley and M. O'Brien, for the appellant/respondent by cross-appeal, ExxonMobil Canada Ltd., formerly known As Mobil Oil Canada Ltd.

This costs application was heard by way of written submissions received up to August 23, 2013, by Martin, Watson and McDonald, JJ.A., of the Alberta Court of Appeal. The court delivered the following memorandum of judgment on September 25, 2013.