Executive Summary: Key Legal and Evidentiary Issues

• Characterization of “overall success” on a motion for a stay when the moving party succeeds on only one of multiple legal grounds, but still achieves its main litigation objective.
• Application of Ontario’s costs principles to a mixed result, including how courts weigh proportionality, complexity, and importance of the motion to each party.
• Reasonableness of counsel’s time spent and rates on a contested construction lien and stay motion, including comparison of hours and the concept of a reasonable expectation of adverse costs.
• Interaction between a subcontract stay clause (linked to substantial completion), arbitration/ADR processes, and the court’s inherent and statutory powers to stay lien and related proceedings.
• Treatment of overlapping proceedings (lien actions, arbitration, civil proceedings and ADR) and the need for orderly case management through temporary stays.
• Determination of a fair partial indemnity costs award where the successful party failed on two major stay arguments but obtained a limited, time-bound stay and thus partial success.

Factual background and parties

Camino Construction 2016 Inc. (Camino) commenced construction lien proceedings (the “Camino Lien Actions”) arising from a construction project in which Graham Construction and Engineering LP (Graham) was a key contracting party and the City of Toronto was also named. The dispute emerged in a multi-layered project environment that included various claims, arbitration and other alternative dispute resolution processes, parallel civil proceedings, and detailed contractual provisions in a subcontract between Camino and Graham. The lien actions formed only one part of a broader web of disputes relating to the same project.

Under the subcontract, Camino performed construction work for Graham on the project. The subcontract contained clauses dealing with dispute resolution and the timing of any court proceedings, including a requirement that certain disputes or actions be stayed until project substantial completion. The project also engaged multiple ADR mechanisms and arbitration proceedings, all of which bore on whether the lien actions should continue or be paused while those alternative processes unfolded.

The motion for a stay of the Camino lien actions

In September 2025, Graham brought a motion in the Ontario Superior Court of Justice seeking to stay the Camino Lien Actions on three distinct legal grounds. First, Graham argued that the matters raised in the lien actions were subject to an arbitration agreement and should therefore be stayed in favour of arbitration. Second, Graham submitted that the lien issues were already being addressed in another action and that duplication justified a stay. Third, relying on the wording of the subcontract, Graham contended that the lien actions were contractually required to be stayed until project substantial completion.

On November 24, 2025, Associate Justice C. Wiebe released reasons on the stay motion. Graham did not succeed on its arbitration-based stay request, nor on its argument that the lien actions should be stayed as duplicative of another proceeding. However, the court accepted the third ground: that the subcontract required a stay of the Camino Lien Actions until substantial completion of the project. The ordered stay was temporary and expected to last about seven months, designed to permit the agreed alternative dispute resolution mechanisms to proceed and the project to move toward completion.

Although Graham failed on two of its three specific theories for a stay, the court found that the “main purpose” of its motion was to obtain some form of stay of the Camino Lien Actions. That objective was achieved through the contractual/subcontract stay, even if narrower and shorter in duration than originally sought.

Contractual provisions and dispute resolution framework

The motion turned heavily on the interplay between the subcontract’s dispute resolution provisions and the statutory and procedural tools available to the court. One set of provisions placed certain disputes into arbitration or other ADR processes, forming the basis for Graham’s argument that the lien actions should be stayed because the underlying issues were “submitted to arbitration.” A different set of clauses, including a stay requirement tied to project substantial completion, governed when court proceedings could move forward while the project and ADR processes were ongoing.

The court ultimately declined to stay the lien actions on a pure arbitration-agreement theory but accepted that the subcontract contractually required a stay until substantial completion. This reflected a nuanced view of the contract: the agreement did not oust the court’s jurisdiction completely, yet it imposed a temporal constraint on when lien litigation could proceed. The stay, therefore, was granted on a contractual timing basis, not on the broader and more permanent theories advanced under arbitration law or procedural duplication.

This contractual stay dovetailed with the court’s broader concern for orderly management of multiple related proceedings. With civil actions, arbitration, ADR, and lien proceedings all in play, the court recognized that allowing the alternative processes to “unfold” while the project moved forward was important, and that the subcontract’s stay clause was one mechanism to achieve that balance.

Costs dispute following the stay decision

After issuing the November 24, 2025 decision on the stay motion, the court invited written costs submissions. Both parties filed detailed costs outlines on a partial- and substantial-indemnity basis. Graham claimed partial indemnity costs of $37,871.27 and substantial indemnity costs of $56,806.92, apparently exclusive of HST. Camino’s partial indemnity costs were $20,544.76 and its substantial indemnity costs were $30,817.13, inclusive of HST.

Graham sought a costs award of $32,000 plus HST ($36,160) on a partial indemnity basis. It arrived at that figure by “normalizing” billing rates, comparing similar years of call between the two sides, and averaging the resulting figures. Graham submitted that, as the successful party on the motion, it was presumptively entitled to its costs. Camino, in contrast, argued that it was in substance the successful party because it defeated Graham’s attempts to obtain what it characterized as “permanent stays” and only lost on a relatively minor, temporary stay. Camino sought $13,559.54 in partial indemnity costs (66% of its own partial indemnity bill), or alternatively urged the court to reduce any award to Graham based both on Graham’s limited success and on a proportionality-based criticism of the hours Graham spent.

Camino emphasized that Graham’s counsel spent 94 hours on the motion compared to Camino’s 52 hours, meaning Graham devoted roughly 40 more hours and almost twice the total time. Camino argued that its own bill was the reasonable benchmark for what it should expect to pay if it lost, and that Graham’s spending and claimed costs should be adjusted down to reflect over-lawyering and lack of proportionality.

The court’s approach to success and proportionality on costs

Associate Justice Wiebe began the costs analysis by emphasizing that costs are not determined on an issue-by-issue basis, but on overall success in the litigation step. Citing appellate authority, the court reiterated that a party may still be considered successful even if it wins on only some arguments, so long as it achieves its central litigation objective. Here, Graham moved for a stay and obtained one. Although this success rested on the subcontract-based stay rather than the two other, more expansive theories, the motion’s main purpose—to secure a stay of the Camino Lien Actions while ADR and the project continued—had been accomplished.

At the same time, the court accepted that Graham’s failure on two of the three stay grounds and the limited duration of the stay warranted a reduction in the quantum of costs. The reasoning highlighted both outcome-based proportionality and the significant time and effort spent on arguments that were ultimately unsuccessful (namely the arbitration stay and the Rule 6.01 stay). Those arguments had consumed most of the parties’ resources, while the successful section 106/subcontract-based stay occupied the least.

On the question of hours and reasonable expectation, the court found some merit in Camino’s criticism that Graham spent far more time on the motion. However, considering the factual complexity of multiple overlapping proceedings and dispute resolution mechanisms, as well as the high importance of the motion to both parties (critical for Graham’s orderly management of its disputes, and crucial for Camino which wished to avoid its action being halted), the court accepted Graham’s reduced partial indemnity claim figure of $36,160 as a reasonable starting point. That figure represented what Camino could reasonably expect to pay in partial indemnity costs had there been no mixed result, given the court’s proportionality assessment.

Ruling on costs and overall outcome

In the final analysis, the court held that Graham was the successful party for costs purposes and was entitled to a reduced, proportionate award. Balancing Graham’s overall success in obtaining a stay with its lack of success on the more time-consuming arbitration and duplication arguments, Associate Justice Wiebe fixed costs at 33% of $36,160, which yielded a partial indemnity award of $12,000. The court also noted that the section 106/subcontract-based stay—on which Graham actually succeeded—had occupied the least time and effort, reinforcing the need for a significant reduction from Graham’s original bill.

The ultimate outcome of the costs decision is that Camino Construction 2016 Inc. must pay Graham Construction and Engineering LP $12,000 in partial indemnity costs, payable within thirty days of February 9, 2026. There is no separate award of damages or other monetary relief quantified in these reasons; the only specified monetary award in favour of the successful party is this $12,000 costs order.