Orlando Rosa

The plaintiffs sold their business, Tracks & Wheels Equipment Brokers Inc., to the defendants.

Disputes arose regarding options to purchase the lands on which the business operated, post-closing adjustments, and the conduct of the parties' shared accountant.

The court found that the accountant breached professional and contractual duties by acting in a conflict of interest.

The court also held that the defendants' counterclaim for post-closing adjustments was not time-barred.

Specific performance was granted to the defendants for the optioned lands, subject to certain severance conditions.

The defendant municipality brought a motion for summary judgment to dismiss the plaintiff railway company's action for unpaid invoices relating to railway crossing upgrades.

The defendant argued that the plaintiff's claim was barred by issue estoppel and res judicata, as a prior arbitration award between the same parties had already determined that the plaintiff made a material misrepresentation by failing to disclose that federal funding would not cover certain overhead charges.

The court agreed, finding that the issues in the current action were identical to those decided in the arbitration, and dismissed the plaintiff's claim as there was no genuine issue requiring a trial.

Following dismissal of the plaintiff’s action, the successful defendant sought costs including substantial indemnity costs after a rejected settlement offer under Rule 49 of the Rules of Civil Procedure.

The court considered the interaction of Rules 49.10, 49.13, and 57.01 and the jurisprudence governing elevated cost awards.

The court held that substantial indemnity costs require reprehensible or egregious conduct unless specifically triggered by Rule 49.10, which did not apply where the plaintiff obtained no judgment.

As there was no misconduct by the plaintiff, elevated costs were not warranted.

The court nevertheless awarded the successful defendant partial indemnity costs in a reduced amount reflecting fairness and reasonable expectations.

Following a successful application compelling arbitration and appointment of an arbitrator, the court determined the appropriate costs award.

The moving parties sought substantial indemnity costs relying on a Rule 49 offer to settle.

The court held the offer lacked a meaningful element of compromise and therefore did not justify substantial indemnity costs under Rule 49.10.

Considering the complexity of the proceeding, the parties’ conduct, and the time reasonably required, the court reduced counsel’s claimed hours and awarded costs on a partial indemnity basis.