Date: 20200525

Docket: T-1621-19

Citation: 2020 FC 643

Ottawa, Ontario, May 25, 2020

PRESENT:  The Honourable Mr. Justice Favel

BETWEEN:

ATTORNEY GENERAL OF CANADA

Applicant

and

FIRST NATIONS CHILD AND FAMILY CARING SOCIETY OF CANADA,

ASSEMBLY OF FIRST NATIONS,

CANADIAN HUMAN RIGHTS COMMISSION, CHIEFS OF ONTARIO,

AMNESTY INTERNATIONAL and

NISHNAWBE ASKI FIRST NATION

Respondents

ORDER REGARDING COSTS AND REASONS

I.  Overview

[1]  In Canada (Attorney General) v First Nation Child and Family Caring Society of Canada, 2019 FC 1529 [Motions Decision], I denied motions brought by the Attorney General of Canada [AGC] and First Nations Child and Family Caring Society of Canada [Caring Society]. The AGC’s motion sought a stay of a compensation order [Compensation Order] issued by the Canadian Human Rights Tribunal [CHRT] while the Caring Society’s motion sought to hold in abeyance or stay the application for judicial review brought by the AGC concerning the CHRT’s Compensation Order.

[2]  In the Motions Decision, I directed the parties to make additional submissions respecting costs by December 31, 2019. At the request of Nishnawbe Aski Nation [NAN], I agreed to extend that deadline to January 7, 2020. The Court has received submissions from the AGC, the Caring Society, the Assembly of First Nations [AFN], Chiefs of Ontario [COO], NAN, and the Canadian Human Rights Commission [CHRC]. Amnesty International did not make submissions at the hearing of the two motions and did not provide submissions respecting costs. Those parties seeking costs also submitted their respective bills of costs.

[3]  I am awarding costs to the Caring Society as set forth below.

II.  Parties’ Submissions

[4]  In this Order and Reasons, I will review the parties’ arguments and certain legal principles governing the award of costs. The parties’ arguments on the legal principles related to costs are generally in agreement. However, they disagree as to the share of success on the motions and the application of the rules governing the award of costs to their respective circumstances.

A.  AGC

[5]  The AGC seeks no costs, and requests that no costs be awarded against it. It notes that Courts require a very good reason to depart from the principle that costs follow the cause. As all parties have had mixed success, no costs should be awarded. The AGC’s submissions are summarized as follows:

• (1) The Caring Society, the AFN, and NAN are not entitled to costs because they had mixed results—they defended against one motion and lost the other. Mixed results beget no costs.

• (2) The CHRC did not seek costs and took no position on the Caring Society’s motion, so it is not entitled to costs.

• (3) Amnesty International declined to participate, so it is not entitled to costs.

• (4) COO made no written submissions, so it is not entitled to costs.

[6]  The AGC further argues that just because the case, as a whole, is in the public interest, it does not follow that parties should be awarded costs for it. It submits that the public interest is only one factor to consider. It submits that it has shown goodwill by not seeking costs, such awards are rare, and the Caring Society’s motion was unnecessary and wasted resources. Therefore, it would be inappropriate for the AGC to pay costs in these circumstances.

B.  Caring Society

[7]  The Caring Society submits that it is the successful party and are entitled to its costs in a lump sum.

[8]  It argues that, although its own motion was unsuccessful, the overall result of the hearing was that it won—the AGC failed to halt the Canadian Human Rights Tribunal [CHRT] proceeding. Its motion did not result in more things being done; it was more of a response to the AGC’s motion than anything—the only extra effort required was the filing of a Notice of Motion. There was no duplication of evidence. The length of the proceeding was not materially impacted.

[9]  The Caring Society argues that there is case law supporting a lump sum award. It relies on Sport Maska Inc. v Bauer Hockey Ltd., 2019 FCA 204 at para 50 [Sport Maska]  for the proposition that lump sum awards as a percentage of actual costs can be a good way to award damages to sophisticated parties. These can be anywhere from 25% – 50% of actual fees, depending on the Court’s assessment of the criteria in Rule 400(3) of the Federal Courts Rules, SOR/98-106 [Federal Courts Rules].

[10]  Rule 400(3) lists the following considerations for the Court’s exercise of discretion under Rule 400(1) of the Federal Courts Rules:

[11]  The Caring Society submits that (a) is in its favor because it was the successful party. It claims that its motion did not result in additional work (it relied on the work needed for the AGC’s stay motion), so the fact that it brought another motion should not reduce its damages. It submits that (c) and (g) require a high-end damage award because, although the issues at the hearing were not complex, the factual context resulted in lengthy submissions and proceedings. Further, the proceedings were important to the public, as evidenced by the extensive news coverage of the hearing. It submits that (h) goes toward awarding damages in the high end of the range because the Caring Society is acting in the public interest. It is defending First Nations Children’s rights and it is a non-profit organization. It submits that (j) militates toward a high damage award because the AGC should have admitted that its alleged “harms” suffered if the stay was not granted were speculative. It notes that, on cross-examination, Mr. Perron admitted this (saying that no compensation was needed at this time). It submits that, respecting (l), the fact that other parties participated in the proceedings should not reduce the Caring Society’s cost award because it was the “lead respondent”. Its efforts allowed the other parties to either rely on its submission, or make limited submissions in addition to the Caring Society’s own.

[12]  In light of all of these considerations, the Caring Society requests a lump sum on the high end of $12,000 – $24,000, which is 25% – 50% of what its lawyers would have charged were they not working pro bono. It cites Roby v Canada (Attorney General), 2013 FCA 251 [Roby] at paras 23-24 as authority that the Court may award damages in this manner despite that the work was done on a pro bono basis. It claims disbursements of $2,881.88. Accordingly, the Caring Society requests $22,881.88, composed of $20,000 in legal fees and $2,881.88 in disbursements.

C.  AFN

[13]  The AFN submits that it should receive costs from the AGC on a solicitor-client basis and “double costs” between October 24, 2019 and November 29, 2019 because the AGC rejected what the AFN describes as an “offer to settle” the matter and subsequently lost its motion for a stay. Alternatively, it requests costs at the high end of Column III in Tariff B.

[14]  The AFN argues that the AGC’s conduct warrants solicitor-client costs against it because the AGC did not even try to resolve matters with the parties and before the CHRT before bringing the motion to stay the CHRT compensation ruling. The AFN highlights that it sent the AGC a letter on October 24, 2019 [the “offer to settle”] indicating that it was amenable to postponing the December 10, 2019 deadline, but the AGC did not respond. The AFN argues that, had the AGC responded and engaged with the parties, the entire motion might have been avoided. The AGC therefore created litigation when none was necessary.

[15]  The AFN also highlights ss 400 and 401 of the Federal Courts Rules governing costs in submitting that the Court has discretion to award whatever it pleases. To simplify the arguments, the AFN discusses some of the factors considered toward cost awards in s 400(3), primarily that the AGC delayed a complex proceeding at the CHRT and that the AGC refused a de facto offer to settle. It claims that the AGC’s rejection of that offer should produce double costs in accordance with Rule 420 of the Federal Courts Rules, which provides consequences for rejected offers to settle. Since the AGC rejected its “offer to settle” and lost the motion, it must pay double costs. The AFN submits that it did a significant amount of work, and the public interest favors giving them a cost award. It submits that the stay motion was unnecessary. It submits that it is a non-profit organization with limited capacity, leaning toward a cost award in its favor.

[16]  Alternatively, it seeks a lesser cost award at the high end of Column III of Tariff B.

D.  COO

[17]  COO takes the same position as the Caring Society on costs. Although COO acknowledges that it did not make extensive written or oral submissions on either motion, it was required to review all of the parties’ materials, attend the cross-examination of the AGC’s affiant, prepare written submissions, attend the hearing, and make oral submissions at the hearing. It seeks an award of $16,636, composed of $14,655 in legal fees and $1,981 in disbursements for preparing its written submissions and attending the motions hearing.

E.  NAN

[18]  NAN seeks costs on a solicitor-client basis inclusive of disbursements or alternatively, a lump sum award of 50% of its legal fees plus disbursements. The first amount totals $32,767.49. The alternative amount totals $20,018.83.

[19]  NAN submits that solicitor-client costs are warranted against the AGC because its motion was frivolous or devoid of merit. NAN claims that the AGC’s motion was against the public interest and was important to NAN and 49 other First Nations in Northern Ontario. NAN’s members are victims of wilful and reckless discrimination. Therefore, solicitor-client costs are appropriate.

[20]  Further, though the AGC successfully opposed the Caring Society’s motion (that NAN supported), the AGC should not be awarded costs because the Caring Society’s motion was in the public interest and both NAN and the Caring Society acted in a public interest role. NAN estimates that between 90-95% of its work entailed responding to the AGC’s motion while the remaining 5-10% of its work was related to the Caring Society’s motion.

[21]  Alternatively, NAN submits that, if this Court finds that the AGC’s motion was only of little merit rather than none, a lump-sum award of 50% of costs plus disbursements is appropriate.

F.  CHRC

[22]  The CHRC requests no costs for either motion, nor that any be awarded against it for either motion.

III.  General Principles

[23]  My colleague Justice Sébastien Grammond recently summarized the principles surrounding the awarding of costs in Whalen v Fort McMurray No. 468 First Nation, 2019 FC 1119 [Whalen]. There, he relied on British Columbia (Minister of Forests) v Okanagan Indian Band, 2003 SCC 71, [2003] 3 S.C.R. 371 [Okanagan] in setting out the following principles related to the awarding of costs at paras 3-5:

The first and more traditional goal of costs awards is the indemnification of the successful party. […]

Thus, costs awards provide incentives to make rational use of scarce judicial resources. […] Likewise, costs awards are thought to discourage frivolous or vexatious lawsuits, because litigants who bring such lawsuits know they will have to indemnify the defendant.

Thirdly, costs awards have the potential of facilitating access to justice.

[24]  In addition to these principles, Rules 400-422 of the Federal Courts Rules also apply. Rule 400(1) provides that the trial judge has full discretion on awarding costs. This discretion is to be exercised judicially. As well, the default mechanism for awarding costs is a tariff (Whalen at para 8).

[25]  Other tools a Court has at its disposal are “solicitor and client costs”, used typically to sanction a party’s wrongful conduct in a proceeding, as well as lump sum awards, pursuant to Rule 400(4) of the Federal Courts Rules (Whalen at paras 10 and 11).

[26]  As my colleague Justice Luc Martineau stated in Eurocopter v Bell Helicopter Textron Canada Ltee, 2012 FC 842 [Eurocopter] at para 9: “the exercise of costs assessment involves an inescapable risk of arbitrariness and roughness on the part of the Court”. This Order and Reasons is my attempt to be fair and not to create arbitrariness by applying the legal principles that guide the exercise of my discretion.  

[27]  Eurocopter involved complex legal and factual issues in a patent infringement action quite different from the Motions Decision. Nevertheless, Eurocopter provides some helpful guidance on how costs should be approached. For instance, at paragraph 20, Justice Martineau summarized how a Court is to consider a departure from Tariff B in awarding costs:

The importance and complexity of the case and the amount of work required (Rule 400(3)(c) and (g) of the Rules) often prove determinative of the scale of costs […] In fact, unless the Court orders otherwise, Rule 407 requires that costs be assessed at the mid-point of column III of the table to Tariff B along with certain additional fees and disbursements. Tariff B “represents a compromise between compensating the successful party and burdening the unsuccessful party” and “reflects the philosophy that party and party costs should bear a reasonable relationship to the actual costs of litigation, while preserving the discretion of the court and the assessment officer as that discretion is permitted under the Rules […] The jurisprudence also establishes that “where an award of increased costs is warranted, the Court should first determine whether an award of costs that is reasonable is possible within the scope of Tariff B. Only where that would dictate an unreasonable or unsatisfactory result, should the Court consider awarding an amount in excess of the Tariff […].

[Citations omitted.]

[28]  With these principles in mind, I will now turn to the application of these principles to the circumstances of these motions.

IV.  Analysis

[29]  The parties have all set out the principles from the Federal Courts Rules and the case law that the Court should consider in determining whether costs should be awarded. All parties also recognize that the awarding of costs is within the discretion of the judge hearing the motion and that this discretion must be exercised judicially.

[30]  I wish to restate my determination in the Motions Decision at para 18 that the AGC’s motion was not frivolous. The AGC has not argued that the Caring Society’s motion (which was supported by the AFN, COO and NAN) was frivolous and it does not seek costs against any party. Based on the submissions of the parties the only matter for consideration is whether costs should be awarded against the AGC and, if so, in what amounts.

[31]  The two circumstances of when solicitor-client costs can be awarded were outlined in Whalen at para 13:

In Quebec (Attorney General) v Lacombe, 2010 SCC 38 at paragraph 67, [2010] 2 S.C.R. 453, the Supreme Court of Canada stated that solicitor-client costs are “very rarely granted” and gave two examples of circumstances warranting such an award: (1) where a party’s conduct was “reprehensible, scandalous or outrageous”; (2) where a lawsuit was brought in the public interest.

[32]  Solicitor-client costs are generally considered to be in reference to conduct that arises during the course of litigation, not conduct that gave rise to the litigation. I have not been persuaded that there was such reprehensible conduct on the part of the AGC in this proceeding. Rather, for a contested hearing, I wish to point out that all parties were cooperative in terms of the ambitious timetable for the completion of litigation steps and in setting the date for the hearing of the motions. This ambitious timetable was, in part, driven by the impending December 10, 2019 deadline for reporting that was set by the CHRT. Accordingly, there is no basis to award solicitor-client costs against the AGC.

[33]  I am in agreement with the AGC that the first principle identified in Okanagan at para 1 is an important principle. I also note that Justice Martineau in Eurocopter found that it is possible for there to be a more successful party that can be entitled to part of its costs (at para 34). For similar reasons, I find that the Caring Society’s defense of the AGC’s motion to stay the CHRT Compensation Order made it more successful, even if its attempt to have the AGC’s application for judicial review held in abeyance or stayed was unsuccessful. If the AGC were successful in its stay motion, then the Caring Society, and the other Respondents, would have been prevented from even discussing the issue of compensation before the CHRT until the application for judicial review was decided. This would have been a major setback toward the goal of seeking justice for First Nations children.

[34]  Alternatively and in addition, the third principle identified in Okanagan, the public interest, entitles the Caring Society to part of its costs. More will be said about the AGC’s and Caring Society’s arguments below.

[35]  The remaining analysis will therefore consider the public interest aspect of this proceeding. Before doing so, I also wish to point out that, as I said in the Motions Decision, much of what was submitted or argued at the hearing of the motions went beyond the specific arguments of whether the conjunctive test for the granting of a stay was satisfied but the submissions and arguments often delved into the merits of the underlying application for judicial review. The Caring Society acknowledged that the issues were not complex but that the factual context resulted in lengthy submissions and proceedings.

[36]  Respecting the AFN, COO and NAN, I acknowledge that they represent and serve a large constituency of citizens and First Nations communities that will be affected by the underlying judicial review proceeding; however, this alone is not sufficient for me to exercise my discretion in awarding costs in their favour.

[37]   The AFN submitted that it maintains a budget to address a number of legal matters such as the protection of the human rights of its constituents, but its budget is limited. The affidavits and supporting exhibits that were filed by the AFN were voluminous. While the affiants were undoubtedly knowledgeable about matters related to child and family services matters, its affidavit materials were more relevant to the merits of the underlying application for judicial review rather than arguing the merits of whether the conjunctive test for the granting of a stay was satisfied. Under the circumstances, I am exercising my discretion not to award costs to the AFN. As a result, there is no need to further analyze its submissions for elevated costs in accordance with Rule 420 of the Federal Courts Rules.

[38]  Respecting COO, it acknowledges that it did not make extensive written or oral submissions on both motions. COO’s counsel did attend at the cross-examination of the AGC’s affiant and reviewed the submissions of the other parties. In light of the COO’s limited participation, I am exercising my discretion not to award costs to COO.

[39]  NAN’s submissions focused on what it calls the AGC’s “frivolous” motion. As stated above, in the Motions Decision I had determined that the AGC’s motion was not frivolous, therefore there is no basis for an award of solicitor-client costs. At the hearing, much of NAN’s submissions delved into the merits of the underlying application for judicial review. I am therefore exercising my discretion to not award costs to NAN.

[40]  As stated above, the CHRC submits that costs should not be awarded for or against it. I agree.

[41]  The AGC has argued that the Caring Society’s motion was unnecessary and wasted resources. I am not persuaded by this argument. A motion was brought by the AGC to which the Caring Society responded and for which it made a similar motion in response. The matter was scheduled for a two-day hearing but it lasted for one and a half days. I am persuaded by the Caring Society’s submissions that there was no duplication of evidence and the length of the hearing was not materially impacted.

[42]  I also agree with the AGC’s submission that the public interest is but one factor of several for the Court to consider in whether to exercise its discretion and award costs. In Okanagan, the Supreme Court, at paragraph 40, set out criteria for awarding costs on an interim basis in public interest litigation:

1. The party seeking interim costs genuinely cannot afford to pay for the litigation, and no other realistic option exists for bringing the issues to trial — in short, the litigation would be unable to proceed if the order were not made.

2. The claim to be adjudicated is prima facie meritorious; that is, the claim is at least of sufficient merit that it is contrary to the interests of justice for the opportunity to pursue the case to be forfeited just because the litigant lacks financial means.

3. The issues raised transcend the individual interests of the particular litigant, are of public importance, and have not been resolved in previous cases.

[43]  The Caring Society has persuaded me that it is entitled to some costs in light of the above criteria. The AGC has argued that the Court requires a good reason to depart from the principle that costs follow the cause and that no costs should be awarded when there is a mixed result.

[44]  Under typical circumstances, I would agree with the AGC. However, the hearing of the motions has highlighted the unique circumstances of this litigation. I have determined that there is good reason to award costs to the Caring Society, in part because it was the more successful party and, in part, due to the public interest.

[45]  In addition, the Caring Society has been prosecuting and defending its case for approximately thirteen years at the CHRT, the Federal Court, and the Federal Court of Appeal. The Caring Society’s motion did not make the hearing more complex nor did it take up much additional time or resources. It is apparent that its human and financial resources are not as extensive as the AGC’s. I am also persuaded by the Caring Society’s argument that it is clearly the lead Respondent in this matter in addressing the public interest. These factors weigh in favour of costs being granted in favour of the Caring Society.

[46]  The Caring Society argued that a factor in awarding lump sum costs is the public interest aspect of the proceedings and the sophistication of the parties. There is no doubt that all parties in the hearing of the motions are sophisticated. However, this is simply another factor and not a determinative factor. As a result, I am exercising my discretion not to award lump sum costs to the Caring Society.

[47]  As referenced above in Whalen, one of the principles in awarding costs is facilitating access to justice. This, in my view, is connected to the criteria set forth in Okanagan that I referenced above. All of the parties acknowledged the desire to provide justice for First Nations children, yet the opposing positions reveal there is still no agreement on how to address the issue comprehensively. The Caring Society’s advocacy has helped bring this issue to the forefront of the legal and political discourse in this country. Access to justice, coupled with the public interest, is an important principle that uniquely applies to this particular proceeding when costs are being considered.

[48]  I am persuaded by the submissions of the Caring Society that most of the work respecting both motions was undertaken by the Caring Society’s legal team who, it was submitted, is providing its legal services on a pro bono basis. The Federal Court of Appeal, in Roby, stated the following about pro bono representation at para 28:

In my view, this is an appropriate case to award costs for the benefit of pro bono counsel. In exemplary fashion, Mr. Tonkovich untangled a confusing body of evidence and argument, discerned the most important legal issues, and effectively presented submissions that were of significant assistance to the Court in the efficient resolution of this case. However, the amount of the award must be modest given the applicable tariff, and will necessarily represent only a fraction of the actual value of the time Mr. Tonkovich must have spent in preparing for the hearing and presenting argument.

[49]  Similarly, counsel for the Caring Society assisted the Court by reviewing the evidence and arguments and effectively presenting its submissions. Considering the above passage, the award must also be modest given the applicable tariff.

V.  Conclusion

[50]  Applying the above principles, and considering the submissions of the parties, I am exercising my discretion to award partial costs to only the Caring Society. Under the circumstances, I am declining to award lump sum costs to the Caring Society in accordance with Sport Maska but am awarding costs to the Caring Society at the low end of Column III of Tariff B for one counsel. The lower end of Column III is reasonable in light of the fact that the result of the motions was somewhat split and that, in my view, the Caring Society was more successful by its defence of the AGC’s motion. In the Court’s view, this amount is consistent with Roby and within the range identified in Eurocopter.

[51]  In reviewing the Caring Society’s bill of costs and Tariff B I have calculated the costs to be 14 units ($2,100). The amount of the Caring Society’s disbursements ($2,881.88), which appear to be reasonable under the circumstances, are also awarded.

[52]  There will be no costs awarded to the other parties.

ORDER in T-1621-19

THIS COURT ORDERS that:

1. The AGC is to pay costs to the Caring Society at the lower end of Column III of Tariff B in the amount of $2,100.00.

2. The AGC is to pay to the Caring Society the sum of $2,881.88 for disbursements.

3. The amounts referred to in paragraphs 1 and 2 shall be paid within sixty (60) days of this Order.

4. There are no costs ordered in relation to any other parties.

“Paul Favel”

FEDERAL COURT

SOLICITORS OF RECORD

DOCKET:	T-1621-19
STYLE OF CAUSE:	ATTORNEY GENERAL OF CANADA v FIRST NATIONS CHILD AND FAMILY CARING SOCIETY OF CANADA, ASSEMBLY OF FIRST NATIONS, CANADIAN HUMAN RIGHTS COMMISSION, CHIEFS OF ONTARIO, AMNESTY INTERNATIONAL and NISHNAWBE ASKI FIRST NATION
SUBMISSIONS ON COSTS CONSIDERED AT OTTAWA, ONTARIO PURSUANT TO THIS COURT’S JUDGMENT IN 2019 FC 1529
ORDER AND REASONS:	Favel J.
DATED:	May 25, 2020

WRITTEN REPRESENTATIONS BY:

Mr. Robert Frater Mr. Max Binnie Ms. Meg Jones	FOR THE APPLICANT
Mr. David Taylor Ms. Barbara McIsaac Ms. Sarah Clarke Ms. Anne Levesque Mr. Stuart Wuttke Ms. Julie McGregor Mr. Brian Smith Ms. Jessica Walsh Mr. Julian Falconer Ms. Molly Churchill Ms. Maggie Wente	FOR THE RESPONDENTS (FIRST NATIONS CHILD AND FAMILY CARING SOCIETY OF CANADA) FOR THE RESPONDENTS (ASSEMBLY OF FIRST NATIONS) FOR THE RESPONDENTS (CANADIAN HUMAN RIGHTS COMMISSION) FOR THE RESPONDENTS (NISHNAWBE ASKI FIRST NATION) FOR THE RESPONDENTS (CHIEFS OF ONTARIO)

SOLICITORS OF RECORD:

Attorney General of Canada Ottawa, Ontario	FOR THE APPLICANT
Conway Baxter Wilson LLP/s.r.l. Ottawa, Ontario Clarke Child & Family Law Toronto, Ontario Nahwegahbow Corbierre Barristers and Solicitors Falconers LLP Toronto, Ontario Olthuis Kleer Townshend LLP Toronto, Ontario Stockwoods LLP Barristers Toronto, Ontario Canadian Human Rights Commission Ottawa, Ontario	FOR THE RESPONDENTS (FIRST NATIONS CHILD AND FAMILY CARING SOCIETY OF CANADA) FOR THE RESPONDENTS (ASSEMBLY OF FIRST NATIONS) FOR THE RESPONDENTS (NISHNAWBE ASKI FIRST NATION) FOR THE RESPONDENTS (CHIEFS OF ONTARIO) FOR THE RESPONDENTS (AMNESTY INTERNATIONAL) FOR THE RESPONDENTS