T-1751-74
William Henry Bowler and Hilda Bowler
(Plaintiffs)
v.
The Queen (Defendant)
Trial Division, Thurlow A.C.J.—Ottawa, May 13,
1976.
Practice—Costs—Expropriation—Actions settled—Plain-
tiffs seeking order dismissing actions and for solicitor and
client costs—Expropriation Act, R.S.C. 1970 (1st Supp.) c. 16,
s. 36—Federal Court Act, s. 57(3) and Rule 605.
In an expropriation action, plaintiffs applied for judgment by
consent, seeking an order dismissing the action and awarding
costs to plaintiffs on a solicitor and client basis.
Held, the motions are dismissed, if no request for oral
argument is received by May 25, 1976. Apart from being
self-contradictory, the form of order proposed is contrary to
Rule 605. If compensation is settled by agreement, adjudication
is unnecessary; the agreement prevails, and shall provide for all
aspects of the settlement. If a court proceeding is pending when
agreement is reached, the agreement should provide for its
discontinuance or dismissal without costs, for the court then has
nothing to adjudicate or award either party. In the absence of
agreement, authority for payment is section 57(3) of the Fed
eral Court Act. The Court must take the position that it will
not permit the device of a judgment by consent of the parties to
take the place of an adjudication on proper material of the
actual liability of the Crown. Where liability is adjudged, costs
can be awarded. This was an attempt to combine an agreement
with a court order which, on its face, would purport to be an
award by the Court of a portion of what the parties have agreed
on, and would be an award of a kind rare to an ordinary action.
This is contrary to the Hooper case ([1942] Ex.C.R. 193) and
not authorized or warranted by section 36 of the Expropriation
Act. Even if the amounts agreed on could be seen as coming
within the meaning of the amount "adjudged" in section 36(2),
there is nothing to call for solicitor and client costs.
APPLICATION in writing under Rule 324.
SOLICITORS:
Chappell, Bushell & Stewart, Toronto, for
plaintiffs.
Deputy Attorney General of Canada for
defendant.
The following are the reasons for judgment
rendered in English by
THURLOW A.C.J.: This is an application
brought under Rule 324 for judgment by consent
in an action for compensation for property taken
under the Expropriation Act. Similar applications
are before me in six other actions. In each case the
order now sought is in the following terms:
UPON the consent of the parties being filed, this Court does
order and adjudge that the action herein be dismissed and that
the Plaintiffs do recover from the Defendant the costs of and
incidental to this action to be taxed on a solicitor and client
basis.
The applications show an undue lack of care in
their preparation. When originally presented the
order sought in this and one other case was one
dismissing the action "with costs payable on a
solicitor and client basis", an order which would
have meant an entirely different result from that
now sought. Nevertheless it was consented to by
solicitors for the plaintiffs. On that occasion coun
sel were asked to explain why costs were to be
awarded on a solicitor and client basis. The answer
received appears later in these reasons.
In four of the seven cases the order originally
sought was that the action be dismissed "with
costs payable under the Expropriation Act".
Counsel were asked to explain what that meant.
No explanation has been forthcoming.
In the remaining case the order originally
sought asked for "dismissal of the action with costs
to the plaintiffs". Such an order is self-contradic
tory as the dismissal of the action means that the
plaintiffs take nothing by their action. A form or
order providing for recovery of party and party
costs by the plaintiffs but dismissing the action in
other respects was suggested but has not been
adopted by counsel in renewing the applications.
Apart from being self-contradictory, the pro
posed form of order for recovery by the plaintiffs is
contrary to Rule 605, which continues the long
established practice under the former Petition of
Right Act.
I turn now to the substance of what is involved
in the orders as now sought.
Under the Expropriation Act the amount of
compensation payable in respect of expropriated
property may be settled by agreement of the par
ties or by adjudication. But the two methods are
not the same. If the settlement is by agreement
there is no need of the court or of any adjudication
by it. The agreement prevails and it should provide
for all aspects of the settlement. If at the time an
agreed settlement is arranged a proceeding to
determine compensation is pending in the Court,
the agreement ought to provide for termination of
the proceeding either by discontinuance or dismis
sal of the proceeding without costs, as in such an
action the Court has nothing to adjudge or to
award to either party by way of costs or
otherwise'. It is important to bear in mind that in
such a case the authority for payment of the
amount agreed upon must be found in an appro
priation by Parliament for the purpose.
On the other hand, where there is no agreement
and the Court determines the compensation, the
authority for payment of the amount adjudged is
section 57(3) of the Federal Court Act. It should
be unnecessary to add that the authority is limited
to what the Court adjudges the Crown to be liable
to pay. The position of the Court must therefore be
that it will not permit the device of a judgment by
consent of the parties to take the place of an
adjudication on proper material of the actual lia
bility of the Crown 2 . Where that liability is
adjudged by the Court, costs can be awarded and
there are special provisions in the Expropriation
Act with respect to them. Section 36 provides:
36. (1) Subject to subsection (2), the costs of and incident
to any proceedings in the Court under this Part are in the
discretion of the Court or, in the case of proceedings before a
judge of the Court or a judge of the superior court of a
province, in the discretion of the judge, and the Court pr the
judge may direct that the whole or any part of such costs be
paid by the Crown or by any party to the proceedings.
(2) Where the amount of the compensation adjudged under
this Part to be payable to a party to any proceedings in the
Court under section 29 in respect of an expropriated interest
does not exceed the total amount of any offer made under
1 I mention "without costs" because under the Rules of the
Court a simple discontinuance or a simple dismissal will entitle
the defendant to tax and recover his costs against the plaintiff.
2 See The King v. Hooper [1942] Ex.C.R. 193.
section 14 and any subsequent offer made to such party in
respect thereof before the commencement of the trial of the
proceedings, the Court shall, unless it finds the amount of the
compensation claimed by such party in the proceedings to have
been unreasonable, direct that the whole of such party's costs of
and incident to the proceedings be paid by the Crown, and
where the amount of the compensation so adjudged to be
payable to such party exceeds that total amount, the Court
shall direct that the whole of such party's costs of and incident
to the proceedings, determined by the Court on a solicitor and
client basis, be paid by the Crown.
I come now to the explanation above referred to,
made in response to the Court's inquiry as to the
reason for the provision for recovery of solicitor
and client costs. It reads as follows:
I have your three letters of April 22, 1976, with respect to
the above seven cases.
When these actions were settled it was upon the basis that
costs would be paid by the Defendant to the Plaintiffs upon a
solicitor and client basis to be taxed by a Taxing Officer of the
Court unless the parties could agree on the quantum of costs
before taxation. It would appear that the consents previously
delivered to us and filed do not adequately express that and I
am enclosing for each a new Notice of Motion and Consent
together with a draft judgment. These are to be disposed of
pursuant to Rule 324 without personal appearance of counsel
for the parties.
I trust that these will more accurately reflect the basis of the
judgment sought.
It appears to me that what this discloses is an
attempt to combine an agreement settling compen
sation with an order of the Court, which on its face
would purport to be an award by the Court of a
portion of what the parties have agreed upon. It
would also be an award of costs of a kind rarely
given in any ordinary action and then only for very
cogent reasons. At the same time it would be likely
to be much greater than an award of costs on the
party and party scale which would follow as a
matter of course under the Rules on a simple
discontinuance or simple dismissal of the action.
In my view this is contrary to the principle of
the decision of this Court in The King v. Hooper 3
and there is nothing in the language of section 36
of the Expropriation Act to authorize or warrant
it. Moreover, even if the amounts of compensation
agreed upon could be regarded as falling within
the meaning of the amount of the compensation
"adjudged" in subsection 36(2), and I think it
3 [1942] Ex.C.R. 193.
cannot, there is nothing in the record, and there
should not be 4 , which would show that the situa
tion is one in which the payment of solicitor and
client costs should be directed.
If counsel wish to argue the matter orally,
arrangements will be made to set the motions
down for hearing. If no request for such a hearing
is received by May 25, 1976, the motions will
stand dismissed.
These reasons apply to the applications on files:
T-1751-74, T-1777-74, T-1778-74, T-1779-74,
T-1800-74, T-1801-74 and T-2462-75.
See Galway v. The Queen [1974] C.T.C. 454 at 455.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.