The appellant tenant commenced an action for a declaration that its commercial lease was binding against the owners of the building.
The building was subsequently sold to the respondent, who was added as a defendant, and then sold again to a new owner.
The appellant negotiated a new lease with the new owner and brought a motion to dismiss the action with costs.
The respondent cross-moved to compel the appellant to discontinue the action and pay costs.
The Master granted the cross-motion.
On appeal, the Divisional Court held that Rule 23.01 does not permit a court to compel a plaintiff to discontinue an action.
The court further held that the action became moot because the respondent sold the property, not because the appellant negotiated a new lease, and therefore each party should bear its own costs.
The appeal was allowed and the action dismissed without costs.