Lisa Neil

Following a prior decision granting the defendants’ motion to enforce a settlement agreement, the court considered costs.

The defendants sought substantial indemnity costs from the date the settlement was accepted, arguing the subsequent litigation resulted solely from the plaintiff’s refusal to honour the settlement.

The court applied s.131 of the Courts of Justice Act and rr. 49.10 and 57.01 of the Rules of Civil Procedure.

Substantial indemnity costs were found appropriate, though the court reduced counsel’s hourly rate and excluded time relating to proceedings where no costs had been awarded.

Costs were fixed at $15,960.63 payable by the plaintiff.

The defendants brought a motion under Rule 49.09 to enforce a settlement agreement allegedly reached via correspondence between counsel.

The plaintiff argued that while it agreed to dismiss the action, it never agreed to discharge the mortgages on the commercial properties it had sold to the defendants.

The court found that, viewed objectively, the plaintiff's offer to dismiss the action reasonably included giving up its mortgage remedies, and the defendants' acceptance created a binding contract.

The court exercised its discretion to enforce the settlement, noting that allowing the litigation to continue would prejudice the defendants due to significant delay and lost evidence.

The action and counterclaim were dismissed, and the mortgages ordered discharged.