Federal Courts Rules (SOR/98-106)

Marginal note:Setting aside or variance

• 399 (1) On motion, the Court may set aside or vary an order that was made

  • (a) ex parte; or

  • (b) in the absence of a party who failed to appear by accident or mistake or by reason of insufficient notice of the proceeding,

  if the party against whom the order is made discloses a prima facie case why the order should not have been made.

• Marginal note:Setting aside or variance

  (2) On motion, the Court may set aside or vary an order

  • (a) by reason of a matter that arose or was discovered subsequent to the making of the order; or

  • (b) where the order was obtained by fraud.

• Marginal note:Effect of order

  (3) Unless the Court orders otherwise, the setting aside or variance of an order under subsection (1) or (2) does not affect the validity or character of anything done or not done before the order was set aside or varied.

PART 11Costs

Awarding of Costs Between Parties

Marginal note:Discretionary powers of Court

• 400 (1) The Court shall have full discretionary power over the amount and allocation of costs and the determination of by whom they are to be paid.

• Marginal note:Crown

  (2) Costs may be awarded to or against the Crown.

• Marginal note:Factors in awarding costs

  (3) In exercising its discretion under subsection (1), the Court may consider

  • (a) the result of the proceeding;

  • (b) the amounts claimed and the amounts recovered;

  • (c) the importance and complexity of the issues;

  • (d) the apportionment of liability;

  • (e) any written offer to settle;

  • (f) any offer to contribute made under rule 421;

  • (g) the amount of work;

  • (h) whether the public interest in having the proceeding litigated justifies a particular award of costs;

  • (i) any conduct of a party that tended to shorten or unnecessarily lengthen the duration of the proceeding;

  • (j) the failure by a party to admit anything that should have been admitted or to serve a request to admit;

  • (k) whether any step in the proceeding was

    • (i) improper, vexatious or unnecessary, or

    • (ii) taken through negligence, mistake or excessive caution;

  • (l) whether more than one set of costs should be allowed, where two or more parties were represented by different solicitors or were represented by the same solicitor but separated their defence unnecessarily;

  • (m) whether two or more parties, represented by the same solicitor, initiated separate proceedings unnecessarily;

  • (n) whether a party who was successful in an action exaggerated a claim, including a counterclaim or third party claim, to avoid the operation of rules 292 to 299;

  • (n.1) whether the expense required to have an expert witness give evidence was justified given

    • (i) the nature of the litigation, its public significance and any need to clarify the law,

    • (ii) the number, complexity or technical nature of the issues in dispute, or

    • (iii) the amount in dispute in the proceeding; and

  • (o) any other matter that it considers relevant.

• Marginal note:Tariff B

  (4) The Court may fix all or part of any costs by reference to Tariff B and may award a lump sum in lieu of, or in addition to, any assessed costs.

• Marginal note:Directions re assessment

  (5) Where the Court orders that costs be assessed in accordance with Tariff B, the Court may direct that the assessment be performed under a specific column or combination of columns of the table to that Tariff.

• Marginal note:Further discretion of Court

  (6) Notwithstanding any other provision of these Rules, the Court may

  • (a) award or refuse costs in respect of a particular issue or step in a proceeding;

  • (b) award assessed costs or a percentage of assessed costs up to and including a specified step in a proceeding;

  • (c) award all or part of costs on a solicitor-and-client basis; or

  • (d) award costs against a successful party.

• Marginal note:Award and payment of costs

  (7) Costs shall be awarded to the party who is entitled to receive the costs and not to the party’s solicitor, but they may be paid to the party’s solicitor in trust.

Marginal note:Costs of motion

• 401 (1) The Court may award costs of a motion in an amount fixed by the Court.

• Marginal note:Costs payable forthwith

  (2) Where the Court is satisfied that a motion should not have been brought or opposed, the Court shall order that the costs of the motion be payable forthwith.

Marginal note:Costs of discontinuance or abandonment

402 Unless otherwise ordered by the Court or agreed by the parties, a party against whom an action, application or appeal has been discontinued or against whom a motion has been abandoned is entitled to costs forthwith, which may be assessed and the payment of which may be enforced as if judgment for the amount of the costs had been given in favour of that party.

Marginal note:Motion for directions

• 403 (1) A party may request that directions be given to the assessment officer respecting any matter referred to in rule 400,

  • (a) by serving and filing a notice of motion within 30 days after judgment has been pronounced; or

  • (b) in a motion for judgment under subsection 394(2).

• Marginal note:Motion after judgment

  (2) A motion may be brought under paragraph (1)(a) whether or not the judgment included an order concerning costs.

• Marginal note:Same judge or prothonotary

  (3) A motion under paragraph (1)(a) shall be brought before the judge or prothonotary who signed the judgment.

Marginal note:Liability of solicitor for costs

• 404 (1) Where costs in a proceeding are incurred improperly or without reasonable cause or are wasted by undue delay or other misconduct or default, the Court may make an order against any solicitor whom it considers to be responsible, whether personally or through a servant or agent,

  • (a) directing the solicitor personally pay the costs of a party to the proceeding; or

  • (b) disallowing the costs between the solicitor and the solicitor’s client.

• Marginal note:Show cause by solicitor

  (2) No order under subsection (1) shall be made against a solicitor unless the solicitor has been given an opportunity to be heard.

• Marginal note:Notice to client

  (3) The Court may order that notice of an order against a solicitor made under subsection (1) be given to the solicitor’s client in a manner specified by the Court.

Assessment of Costs

Marginal note:Assessment by assessment officer

405 Costs shall be assessed by an assessment officer.

Marginal note:Obtaining appointment

• 406 (1) A party who is entitled to costs may obtain a notice of appointment for assessment by filing a bill of costs, a copy of the order or other document giving rise to the party’s entitlement to costs and any reasons, including dissenting reasons, given in respect of that order.

• Marginal note:Notice of appointment

  (2) A notice of appointment for assessment and the bill of costs to be assessed shall be served on every other interested party at least 10 days before the date fixed for the assessment.

Marginal note:Assessment according to Tariff B

407 Unless the Court orders otherwise, party-and-party costs shall be assessed in accordance with column III of the table to Tariff B.

Marginal note:Directions

• 408 (1) An assessment officer may direct the production of books and documents and give directions for the conduct of an assessment.

• Marginal note:Set-off of costs

  (2) Where parties are liable to pay costs to each other, an assessment officer may adjust those costs by way of set-off.

• Marginal note:Costs of assessment

  (3) An assessment officer may assess and allow, or refuse to allow, the costs of an assessment to either party.

Marginal note:Factors in assessing costs

409 In assessing costs, an assessment officer may consider the factors referred to in subsection 400(3).

Marginal note:Costs of amendment

• 410 (1) Unless the Court orders otherwise, the costs occasioned by an amendment to a pleading made without leave shall be borne by the party making the amendment.

• Marginal note:Costs of motion to extend time

  (2) Unless the Court orders otherwise, the costs of a motion for an extension of time shall be borne by the party bringing the motion.

Marginal note:Costs of abandoned motion

411 The costs of a motion that is abandoned or deemed to be abandoned may be assessed on the filing of

• (a) the notice of motion, together with an affidavit stating that the notice was not filed within the prescribed time or that the moving party did not appear at the hearing of the motion; or

• (b) where a notice of abandonment was served, the notice of abandonment.

Marginal note:Costs of discontinued proceeding

412 The costs of a proceeding that is discontinued may be assessed on the filing of the notice of discontinuance.

Marginal note:Accounts of solicitor for Crown

• 413 (1) Where requested by the Attorney General of Canada, a prothonotary shall assess any costs payable by the Crown to a solicitor acting for the Crown in a proceeding.

• Marginal note:Existing rights

  (2) Subsection (1) shall not be construed so as to prejudice any rights between a solicitor and a client in respect of the recovery of the solicitor’s costs in any competent court.

Marginal note:Review of assessment

414 A party who is dissatisfied with an assessment of an assessment officer who is not a judge may, within 10 days after the assessment, serve and file a notice of motion to request that a judge of the Federal Court review the award of costs.

Security for Costs

Marginal note:Application

415 Rules 416 to 418 apply, with such modifications as are necessary, to parties bringing and defending counterclaims and third party claims, to applicants and respondents in an application and to appellants and respondents in an appeal.

Marginal note:Where security available

• 416 (1) Where, on the motion of a defendant, it appears to the Court that

  • (a) the plaintiff is ordinarily resident outside Canada,

  • (b) the plaintiff is a corporation, an unincorporated association or a nominal plaintiff and there is reason to believe that the plaintiff would have insufficient assets in Canada available to pay the costs of the defendant if ordered to do so,

  • (c) the plaintiff has not provided an address in the statement of claim, or has provided an incorrect address therein, and has not satisfied the Court that the omission or misstatement was made innocently and without intention to deceive,

  • (d) the plaintiff has changed address during the course of the proceeding with a view to evading the consequences of the litigation,

  • (e) the plaintiff has another proceeding for the same relief pending elsewhere,

  • (f) the defendant has an order against the plaintiff for costs in the same or another proceeding that remain unpaid in whole or in part,

  • (g) there is reason to believe that the action is frivolous and vexatious and the plaintiff would have insufficient assets in Canada available to pay the costs of the defendant, if ordered to do so, or

  • (h) an Act of Parliament entitles the defendant to security for costs,

  the Court may order the plaintiff to give security for the defendant’s costs.

• Marginal note:Staging

  (2) The Court may order that security for the costs of a defendant be given in stages, as costs are incurred.

• Marginal note:Further steps

  (3) Unless the Court orders otherwise, until the security required by an order under subsection (1) or (2) has been given, the plaintiff may not take any further step in the action, other than an appeal from that order.

• Marginal note:Party temporarily resident in Canada

  (4) A party ordinarily resident outside Canada may be ordered to give security for costs, notwithstanding that the party may be temporarily resident in Canada.

• Marginal note:Voluntary payment into court

  (5) In the absence of an order under subsection (1), a plaintiff may, at any time after filing a statement of claim, pay an amount into court as security for the defendant’s costs and give notice of the payment to the defendant.

• Marginal note:Increase in security

  (6) The Court may, on the motion of a defendant, order a plaintiff who has paid an amount into court under subsection (5) to pay in an additional amount as security for the defendant’s costs.

Marginal note:Grounds for refusing security

417 The Court may refuse to order that security for costs be given under any of paragraphs 416(1)(a) to (g) if a plaintiff demonstrates impecuniosity and the Court is of the opinion that the case has merit.

Marginal note:How security to be given

418 Where a person is required under these Rules or an Act of Parliament to give security for costs or for any other purpose, unless otherwise ordered by the Court or required by that Act, the person may do so

• (a) by paying the required amount into court; or

• (b) by filing a bond for the required amount that has been approved by an order of the Court.

Offer to Settle

Marginal note:Application to other proceedings

419 Rules 420 and 421 apply, with such modifications as are necessary, to parties bringing and defending counterclaims and third party claims, to applicants and respondents in an application and to appellants and respondents in an appeal.