Following a motion to vary dismissed in a prior decision, the applicants sought enhanced costs based on the respondents' alleged misconduct, including apparent AI hallucinations in counsel's reply factum.
The court identified seven paragraphs containing fabricated quotations attributed to real cases with correct neutral citations.
Counsel denied using AI and attributed the errors to carelessness and misreading.
The court expressed inability to reconcile the explanation with the nature of the errors and referred the matter to the Law Society of Ontario for investigation.
The costs of the motion to vary were resolved by consent on a substantial indemnity basis.
