Another Helpful CAT Decision Respecting Costs

In the case of Durham Condominium Corporation No. 80 v. Occleston, the condominium corporation brought an application to enforce the condominium corporation’s no smoking rule as against one of the residents. The parties settled the matter at the Stage 2 mediation, where the resident consented to an order to comply with the Rule. However, the question of costs (payable by the resident) was not resolved.

The condominium corporation claimed that the resident should pay all of the condominium corporation’s legal costs. The condominium corporation sought “Pre-CAT” legal costs of $3,709.80 and “In-CAT” legal costs (for the mediation process and for the costs hearing) of $9,014.01.

The CAT ordered the resident to pay “Pre-CAT” costs of $2,500 and “In-CAT” costs of $2,275.

In terms of the “Pre-CAT” costs, the CAT did not award 100% recovery because the CAT felt that the costs claimed were, in some respects, unreasonable or excessive.

In terms of the “In-CAT” costs, the CAT said:

  • “The impact of a $9000 cost award is likely to be substantial.”
  • “Cases in which full indemnity for legal costs are awarded, either before the courts or tribunals are rare, often arising in instances where the respondent’s actions are prolonged over many years and have been harassing in intent and blatant in their disregard of their community.”
  • “Proportionality is an important consideration when determining the appropriateness of a costs order. In this case, legal costs as of the date of the Consent Order were approximately $3300. DCC 80 made a decision, as it was entitled to do, to incur more costs to pursue reimbursement of those legal fees. This does not mean that the Respondent should be called upon to bear the full cost of that decision.”
  • “However, it is appropriate that some costs be awarded in light of the indemnification provisions of the Rule, and to minimize the burden on other owners, given that the Respondent has acknowledged that smoking had occurred in violation of the Rule.”
  • “I am not convinced that the costs incurred in this case, and in particular, during this hearing, are proportional to the nature of the issue in dispute and what should have been narrowly focussed evidence and submissions in this hearing. The sole issue was costs – a straightforward issue and as a result, an uncomplicated hearing. An award of costs is discretionary and the jurisprudence is clear – condominium corporations must act reasonably and judiciously when incurring legal costs.”

The bottom line, I think, is that the CAT is showing an increased willingness to award “In-CAT” costs in appropriate cases, particularly where there is a clear violation that continues after warning(s) from the condominium corporation. Furthermore, a strong indemnification provision in the governing documents remains an important factor.

Stay tuned to Condo Law News to keep up to date on the latest developments in condominium law.