Colin Brown

Following a successful trial judgment in a contract dispute involving a loan advanced for the purchase of household contents, the successful party sought costs on a substantial indemnity basis due to allegations of fraud raised by the opposing parties.

The court rejected the request for substantial indemnity costs, finding that the unproven allegations of fraud did not justify elevated costs.

Applying s. 131(1) of the Courts of Justice Act and Rule 57.01 of the Rules of Civil Procedure, the court held that costs should follow the event and be awarded on a partial indemnity basis.

Considering fairness, reasonableness, proportionality, and the manner in which the litigation was conducted, the court awarded the successful party $28,967 inclusive of fees, disbursements, and HST.

The plaintiff sued to recover $80,000 loaned to the defendants to finance their purchase of household contents, including Feng Shui stones, from the plaintiff when they purchased her home.

The defendants alleged the contract was invalid due to misrepresentation about the value of certain stones and argued that a fiduciary relationship existed arising from the plaintiff’s role as a Feng Shui advisor and fortune teller.

The court held that no fiduciary relationship existed and found no fraudulent or innocent misrepresentation regarding the stones’ value.

The transaction was a commercial sale of all household contents on an “as is” basis for a lump sum price, which the defendants knowingly accepted and partially performed by paying interest for four years.

The defendants breached the contract by refusing to repay the principal and final interest payment when the loan matured.

Following a six-day family law trial concerning custody, residence of children, and support issues, the successful party sought costs of the trial and a post‑trial motion.

The court considered Rule 24 of the Family Law Rules, including whether the unsuccessful party engaged in unreasonable conduct and the impact of the parties’ settlement offers.

The court found the unsuccessful party had engaged in unreasonable conduct that significantly contributed to the litigation and deterioration of the parties’ relationship.

Although neither party’s settlement offers met the strict requirements for mandatory full indemnity costs, the successful party’s offer was closer to the trial outcome.

The court also considered but largely discounted the unsuccessful party’s financial hardship given the successful party’s responsibility for the children’s care.