Court File and Parties

Court of Appeal for Ontario Date: 2024-07-24 Docket: C70819 & C70820

Between: Hiawatha First Nation Applicant (Respondent/ Appellant by way of cross-appeal)

And: Gregory Cowie, Georgina Rogers and Laurel Shearer Respondents (Appellants/ Respondents by way of cross-appeal)

Counsel: Martin J. Henderson and Brian Chung, for the appellants/respondents by way of cross-appeal David Golden and Christoph Pike, for the respondent/appellant by way of cross-appeal

Heard: March 28, 2023

On appeal from the judgment of Justice Stephen T. Bale of the Superior Court of Justice, dated May 31, 2022, with reasons reported at 2022 ONSC 3276.

Costs Endorsement

[1] This endorsement addresses the question of costs for the applications below arising from the appeal decision in 2023 ONCA 524. As we explain there, the dispute between the parties arose in the context of a transition to greater autonomy under the Indian Act for First Nations respecting reserve land. Hiawatha First Nation's new Land Code came into force on August 12, 2021. It was processed under the old Indian Act but continues in full force. In anticipation of this new Land Code, the First Nation passed a band council resolution on July 17, 2019, in order to impose, "a moratorium on the creation of all new businesses without council's approval".

[2] The appellants sought to develop a gas station on reserve land which they held under certificates of possession. They proceeded with their plans in August 2019 despite the recent passage of the band council resolution.

[3] The application judge granted an injunction to the respondent First Nation prohibiting the appellants from continuing construction work on the gas station, on the basis of the band council resolution.

[4] We found that the application judge erred in granting an injunction because a band council resolution does not have the force of a bylaw under the Indian Act. The appellants were therefore successful on the appeal.

[5] However, we ordered no costs for the appeal in view of the appellants’ concession that the new Land Code would apply to the gas station project even though it came into force after the applications were heard but before the application judge rendered his decision, while reserving the right to object to any particular application of the Land Code to the project by ordinary legal means.

[6] The application judge ordered the appellants to pay the First Nation’s costs in the amount of $235,000 all-inclusive. The First Nation had sought substantial indemnity costs in the amount of $371,304.13. The application judge declined, observing: “While the proponents’ conduct in attempting to take advantage of what they saw as a lacuna in HFN’s laws may be disappointing, I do not find it to be sufficiently reprehensible, scandalous or outrageous as to result in substantial indemnity costs.”

[7] The appellants ask this court to award partial indemnity costs for the applications below in the amount of $262,044.88, or, in the alternative, the amount the application judge had awarded to the First Nation of $235,000.

[8] The First Nation argues in response that the appellants should not be characterized as the successful parties and that the costs of the applications below should still be awarded in its favour. The First Nation argues that it was successful in compelling the appellants to comply with the Land Code, which was its legitimate objective throughout.

[9] Considering the criteria in Rule 57 of the Rules of Civil Procedure, neither side's conduct was beyond reproach. The appellants sought to escape incipient land regulation under the Land Code but have since agreed to abide by it. Band council, for its part, proceeded to litigate under dubious legal pretenses. The appellants’ concession was not legally compelled, but it was socially responsible.

[10] In the circumstances, we reduce the costs award made by the application judge to the respondent to $117,500, all-inclusive.

"P. Lauwers J.A." "David M. Paciocco J.A." "Thorburn J.A."