In his recent decision in Mancinelli v. Royal Bank of Canada, Justice Paul Perell outlined the criteria for determining if an issue in a claim is significantly “novel” that no costs will be ordered against the party who unsuccessfully advances the issue. Legal journalist Shannon Kari reviews Perell’s Ontario Superior Court ruling in an article in Law Times and explains the judge’s position that submitting that an issue is novel because there is nothing in the existing case law that is directly on point is not sufficient. In his judgment in the class action ruling, Perell states that “[f]or an issue to be novel in the legally significant way that would justify the court in ordering no costs against the party who unsuccessfully advanced the issue, it is not enough that the issue is unprecedented or that the issue has not been decided before.” Craig Lockwood, a partner in Osler’s Litigation Group who practises in the area of class action defence, offers additional insight, explaining that judges still have a lot of discretion in this area.

“There is not a strict legal test that has been adopted,” Craig says. “Judges know it when they see it.”

“I think courts were initially bending over backwards to insulate plaintiffs from costs awards,” he continues. “The jurisprudence is more developed now and the trend has shifted. A case must be truly novel or the normal costs rules apply.”

For more information about Perell’s decision, read Shannon Kari’s article “Issue must be ‘novel’ to avoid cost award” in the March 26, 2018 edition of Law Times.