Allan Sternberg

Following dismissal of a motion for an injunction seeking to enforce a non‑competition agreement, the court addressed the issue of costs.

The moving party had sought to enjoin former advisors and a financial services firm from operating a competing branch, but failed to establish an enforceable restrictive covenant or a serious issue to be tried.

The successful defendants sought partial indemnity costs.

The court held that one group of defendants was entitled to costs but denied costs to the corporate defendant due to its pre‑litigation conduct, which the court described as outrageous and contributing to the litigation.

Costs of $40,000 inclusive were awarded to the remaining defendants.

The plaintiff sought interlocutory injunctions enforcing non‑competition and non‑solicitation clauses in a 2004 agreement against several financial advisors and a related investment dealer after the advisors opened a competing branch nearby.

The court applied the RJR‑MacDonald test and considered whether the restrictive covenants were reasonable in geographic scope, temporal scope, and scope of prohibited activity.

Although the geographic scope was arguably reasonable and there was a serious issue to be tried regarding temporal scope, the court found the activity restrictions overly broad and therefore unreasonable.

As a result, the plaintiff failed to establish the required strength of case to justify interlocutory injunctive relief.

The balance of convenience also weighed against granting the injunction because a competing branch would operate regardless.

The motion for interlocutory injunctions was dismissed.

Following a resolved motion for an interlocutory injunction relating to the booking of exhibition space for a bridal show, the court was asked to determine costs.

Although the substantive injunction motion was not adjudicated, the moving party obtained alternative exhibition dates after commencing the motion.

The court held that the motion effectively prompted the resolution and therefore the moving party was successful for the purposes of costs.

Substantial indemnity costs were declined because the responding party’s conduct did not reach the level of reprehensible behaviour.

Partial indemnity costs of $50,000 inclusive of fees, disbursements and GST were awarded to the moving party.