Awarding Costs Under Section 36 Of The Competition Act: 321665 Alberta Ltd. v. Exxonmobil Canada Ltd.

Article by James B. Musgrove, Lisa Parliament and Kate MacDonald, articling student

Introduction

In 321665 Alberta Ltd v ExxonMobil Canada Ltd,1 the Alberta Court of Queen's Bench recently issued the first reported decision seriously considering a claimant's entitlement to costs under section 36 of Canada's Competition Act (the "Act").2

Section 36 grants a civil right of action for any person who has suffered loss or harm as a result of breach of the Act's criminal provisions. To date, there have been only a handful of cases where a claimant has been successful in establishing a section 36 claim outside the context of a settlement. This has resulted in a corresponding lack of jurisprudence interpreting and applying the language of section 36 that allows a successful claimant to recover, in addition to an amount equal to the claimant's proven loss or damage, an amount "not exceeding the full cost to him Of Any Investigation In Connection With The Matter And Of Proceedings Under This Section."3

The Plaintiff in ExxonMobil argued that this language authorized a departure from the default legal principles governing awards of costs and prejudgment interest in Alberta civil litigation. Specifically, the Plaintiff relied on section 36 to seek costs of the proceeding (including legal fees) on a "solicitor-client" full indemnity basis, costs of funding the litigation, investigation costs, and compound interest for the entire period relevant to his damages.

In February 2012, the ExxonMobil Court released its decision on the issues of costs and interest and provided some guidance in this area of competition law. In its decision, the Alberta Court concluded that (i) a section 36 claimant is not entitled to costs of the proceeding on a solicitor-client full indemnity basis and instead standard court costs rules apply; (ii) the cost of a loan to advance the litigation is not compensable; (iii) investigation costs must be established by admissible evidence and do not include a claimant's costs of participating in the litigation; and (iv) the claimant was not entitled to compound interest.

"Full Cost" Of Section 36 Proceedings

In Alberta civil litigation, the standard rule is that litigation costs (including legal fees) may be recoverable on a "party and party" basis (i.e., a successful claimant may be partially indemnified for their costs). In ExxonMobil, however, the Plaintiff argued that the express reference to "full cost" in section 36 meant that this...