Executive Summary: Key Legal and Evidentiary Issues

• This costs endorsement addresses whether an administrative tribunal should pay costs after a judicial review application it defended was resolved by consent.
   
• Judicial review was originally sought based on allegations that the Quinte Conservation Authority denied the Applicant the right to cross-examine witnesses and to make submissions.
   
• Prior to any determination on the merits, the parties agreed that the original QCA decision would be quashed and the matter sent back for a rehearing.
   
• Divisional Court jurisprudence establishes that administrative tribunals generally neither pay nor receive costs in judicial review proceedings absent exceptional circumstances.
   
• Whether the QCA assumed an adversarial role formed the central question, since tribunals acting adjudicatively are typically shielded from costs exposure.
   
• Ultimately, the court found no exceptional circumstances justifying a departure from the general rule against costs awards involving administrative tribunals.
   

Facts of the case

This costs endorsement arises out of a judicial review application brought by The Jos. Rashotte Company Limited (the "Applicant") against the Quinte Conservation Authority ("QCA"). The underlying application challenged a decision of the QCA Board, made in its capacity as a statutory decision-maker under the Conservation Authorities Act, on the basis that the proceedings before it were procedurally unfair. Specifically, the Applicant alleged that the tribunal had refused to allow cross-examination of certain witnesses and had refused to allow the Applicant's counsel to make submissions during the hearing. Before the judicial review application was adjudicated on its merits, the parties resolved the matter: pursuant to a court order, the original QCA decision was quashed, and the matter was directed to proceed to a rehearing before the QCA. With the substantive issue resolved by consent, the sole remaining question before the Divisional Court was whether the Applicant was entitled to recover costs of the judicial review proceeding from the QCA. The Applicant sought costs of $6,087.08, inclusive of fees, disbursements, and HST, on a partial indemnity basis, arguing it was the successful party because the relief obtained matched the principal relief sought. The Respondent argued that no costs should be awarded, relying on the general principle that administrative tribunals neither pay nor receive costs in judicial review proceedings absent exceptional circumstances.

Policy and legislative provisions at issue

The court's analysis centred on section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43, which provides that costs of a proceeding are in the discretion of the court, which may determine by whom and to what extent costs are to be paid. The court also considered Rule 57.01 of the Rules of Civil Procedure, which sets out the factors ordinarily applied in determining costs based on success in civil litigation. Additionally, the decision referenced the QCA's governing framework, noting that the QCA Board acts as an administrative tribunal in respect of appeals of development permit refusals and is governed in that function by the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22.

Reasoning and analysis

Justice Labrosse began by acknowledging that while costs ordinarily follow the event under Rule 57.01, judicial review proceedings involving administrative tribunals engage additional considerations developed through the jurisprudence. Citing Boucher v. Public Accountants Council for the Province of Ontario, the court noted that costs are discretionary and aimed at fixing a fair and reasonable amount rather than full indemnification. Drawing on Brown & Evans' Judicial Review of Administrative Action in Canada and the Divisional Court's decisions in Reynolds v. Ontario (Alcohol and Gaming Commission, Registrar) and Faruk v. The Landlord and Tenant Board, the court reaffirmed that tribunals acting in good faith and in an adjudicative rather than adversarial capacity are ordinarily not exposed to costs, even where their decisions are ultimately quashed or found to be erroneous. Applying this framework, the court found that the judicial review had never been adjudicated on the merits: there was no hearing on the substantive issues, no evidentiary record was tested, and no finding was made regarding whether the QCA had breached procedural fairness. The court accepted that a court order — rather than a purely private settlement — had issued, but held that the absence of a merits determination remained relevant to the costs analysis. The court further found that the QCA had not acted adversarially; rather, it had proposed a rehearing early in the process and engaged in settlement discussions, which did not amount to an admission that procedural fairness had been breached. The Applicant's argument concerning functus officio was considered but rejected as a basis for departing from the established costs principles, with the court noting it had not been presented with authority establishing that a rehearing without a court order would necessarily have been invalid. Citing Weyerhaeuser Company Limited v. Ontario (Human Rights Commission), the court reiterated that advancing procedural or jurisdictional positions does not, by itself, constitute adversarial conduct warranting a costs award against a tribunal.

Ruling and overall outcome

Having considered its discretion under section 131 of the Courts of Justice Act and the relevant factors under Rule 57.01, the court concluded that no exceptional circumstances existed to justify departing from the general rule against costs awards involving administrative tribunals. The court found that the Respondent had acted in its adjudicative capacity, the judicial review had been resolved without a determination on the merits, and the QCA had not assumed an adversarial role. Accordingly, the Applicant's request for costs was denied, and the court ordered no costs as between the parties. The Respondent, Quinte Conservation Authority, was therefore the successful party on the costs issue, and no monetary award was made in favour of either party.