Robert C. Harason

The appellant appealed a $40,000 substantial indemnity costs award made against it following the dismissal of its summary judgment motion.

The Divisional Court found that the motion judge erred by relying on the respondents' counsel's misrepresentation that there was no arithmetical error in the bill of costs, which had inflated the claim by $8,500.

The Court also found errors in awarding costs for appearances where no costs were ordered and for excessive preparation time.

The appeal was allowed and the costs award was reduced to $25,000.

The plaintiff corporation commenced an action while dissolved.

The defendants moved for security for costs, and the Master dismissed the action as a nullity because the plaintiff was dissolved when the action was commenced, despite the plaintiff obtaining Articles of Revival before the Master rendered his decision.

On appeal, the Divisional Court held that under s. 241(5) of the Business Corporations Act, the revival deemed the corporation to have the right to bring the action as though it had not been dissolved.

The appeal was allowed and the dismissal set aside, though costs were awarded against the successful appellant due to its solicitors' delay in obtaining the revival.

On an appeal in a construction lien proceeding, the court considered whether expiry of a perfected lien under s. 46(1) of the Construction Lien Act automatically required dismissal of the entire action, including joined contract claims.

The court held that s. 46(1) mandates dismissal of the action to enforce the lien, but that s. 47(1)(d) preserves discretion to dismiss or allow continuation of non-lien claims within the same action.

Applying that interpretation, the court found the Master had exercised the discretion to dismiss the whole proceeding and that, given four years of inactivity and the absence of responding evidence, there was no arguable basis to interfere.

The appeal was allowed, the Divisional Court order was set aside, and the Master's dismissal order was reinstated.