Important Costs Decision

The Court of Appeal today released its decision in Moon v. Sher , which can be viewed at:

We had been anticipating the release of this case, having learned a few weeks ago that Justice Borins of the Court of Appeal was in the course of preparing a comprehensive discussion of the law of costs. Today’s decision is presumably it.

The main message of the case is that awards of costs are not to be driven just by the amount of time spent by the winning side, multiplied by the hourly rates provided for in the costs grid. As Justice Borins observed: “If a lawyer wants to spend four weeks in preparing for a motion when one week would be reasonable, this may be an issue between the client and his or her lawyer. However, the client, in whose favour a costs award is made, should not expect the court in fixing costs to require the losing party to pay for over-preparation, nor should the losing party reasonably expect to have to do so.”

The decision is, we feel, a salutary effort to inject an element of objectivity into awards of costs which, in some cases, have become wildly unpredictable.

It is too bad that the case before the court did not involve what is becoming a significant costs issue: awards of premiums to successful plaintiffs (but not to successful defendants). Clarification of the law in this area will have to await another day.

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