Background:

• The dispute arose from a contractual agreement where Kinross and its subsidiaries purchased products from Cyanco.
• Kinross sought declaratory relief to clarify that the agreement was limited to liquid sodium cyanide, which would allow them to source solid sodium cyanide elsewhere.
• The court dismissed Kinross' action, leading to a dispute over costs.

Key Legal Issues:

1. Application of Contractual Cost Provisions:
   • Cyanco argued that under section 12.6 of the agreement, they were entitled to recover full indemnity costs.
   • Kinross argued that costs should be on a partial indemnity basis, especially as Cyanco's defenses and actions allegedly extended the litigation unnecessarily.
2. Full Indemnity vs. Partial Indemnity:
   • The court upheld the application of section 12.6, agreeing that the prevailing party (Cyanco) was entitled to all reasonable costs on a full indemnity scale.
3. Costs Involving U.S. Counsel:
   • Cyanco claimed costs for both Canadian and U.S. counsel, arguing U.S. counsel was necessary due to the cross-border nature of the business.
   • The court denied the costs for U.S. counsel, stating that Canadian law governed the agreement and their involvement was not necessary.
4. Assessment of Canadian Counsel’s Costs:
   • Kinross contended that Cyanco's legal fees were excessive.
   • The court determined that the fees were reasonable, considering the high stakes ("bet-the-company" litigation) involved.

Outcome:

• The court awarded Cyanco $2,192,609.12 CAD in costs, covering full indemnity fees for Canadian counsel but excluding the fees for U.S. counsel.