The Hidden Costs Of Enforcing Letters Rogatory In Ontario And How To Avoid Them

The Basics

You have a small proceeding going forward in the Southern District of New York. Unfortunately, one of the main witnesses lives in Toronto, along with her papers. You would like to depose her and get copies of her papers. She takes your first phone call, but politely declines to help. What's next?

If you are looking to compel evidence from an Ontarian witness in support of an American proceeding, you must obtain letters rogatory and then enforce those orders through the Ontario courts. The basics are relatively simple:

you must apply to the court where your proceeding is for an order issuing letters rogatory to the Ontario court and you must engage local Ontario counsel to bring an application (a shortened proceeding) to enforce the letters in the jurisdiction where the witness is.1 These first steps are relatively straightforward and often the mere threat of bringing an action can compel cooperation.

However, the extra court procedures and the fact that Ontario counsel is necessary mean that obtaining evidence or documents from an Ontario witness will be more expensive than obtaining evidence from an American witness. This additional expense is compounded by two differences between the American and Canadian legal system.

Apart from the expected costs of enforcing a contested application, you may also be liable to the witness for: 1) costs on the application and 2) costs of the discovery.

2. Costs on the Application

   1. Costs on a Failed Application to Enforce Letters Rogatory

      You hired local counsel in Toronto, who brought an application to enforce your letters rogatory. Unfortunately, the Judge ruled against you. What's next?

      In Canada, unlike in the US, the losing side is generally required to pay a significant portion of the other side's legal costs.2 This portion generally varies depending on the complexity and length of the proceedings, but, as a rule of thumb, the losing side pays something close to half of the winning side's costs. In the specific case of letters rogatory, however, case law suggests that the winning responding party - the witness you are seeking evidence from - should receive even more protection in the amount of full indemnity.3 Full indemnity, in Ontario courts, means roughly 85% - 90% of actual legal costs (although in some cases, it may be as high as 100%).4

      In other words, if your local counsel loses their application, you (and ultimately your client) will most likely be responsible for paying your prospective witness's lawyer for his or her successful opposition to your application.

      This level of costs, however, is not set in stone. In Oticon,5 the court reviewed a number of cases before concluding that "the appropriate award of costs on an unsuccessful application to enforce letters rogatory will depend upon the particular circumstances of each application." Similarly, in Aker,6 the court concluded that the "scale of costs to be awarded in such a case, (if any), ultimately remains a matter of discretion for the presiding judge, having regard to all the circumstances of the case." In Intelsat,7 the court denied a successful respondent's claim for substantial indemnity costs and awarded her less than half of what she had asked for as costs because the applicant's "conduct has not been reprehensible."

   2. Costs on a Successful Application to Enforce Letters Rogatory

      This time, imagine your local counsel won the application. Now you can enforce the letters rogatory. Are you entitled to costs from the respondent who opposed your application?

      Unfortunately, in Ontario, that is not the case. No case has been found in Ontario, in which applicants who successfully enforce letters rogatory have been awarded their costs.

      In fact, in some cases, even when they win, applicants seeking to enforce letters rogatory are compelled to pay the prospective witness's legal fees. A line of cases, beginning with GST Telecommunications,8 holds that the respondents of applications to enforce letters rogatory are entitled to full indemnity for their legal costs in opposing the motion. This led an Ontario court to declare:

      It is well established in the case law that the costs of witnesses examined pursuant to Letters Rogatory, as strangers to the litigation, should be paid to them on a full indemnity basis.9

      In a related case, j2 Global v. Protus, a different justice came to the same conclusion.10 So, just for the pleasure of taking an Ontario witness's evidence, your client may be compelled to subsidize that witness's attempt to avoid having to give evidence.

      This is not always the case, however. In Neuwirth,11 the court declined to award substantial indemnity costs in favour of the two respondents who were compelled to testify because they were "coy about whether or not they actually possess documents." Similarly, in CIN-Q Automobiles,12 Justice Parayeski ordered that the parties bear their own costs where the...