Executive Summary: Key Legal and Evidentiary Issues

• Registrar Gaily assessed special costs awarded to the City of Delta following contempt findings against Lloyd Investments Ltd.
   
• Delta claimed a bill of special costs totaling $29,805.71, based on invoices from Dominion GovLaw LLP.
   
• Rule 14-1(3) of the Supreme Court Civil Rules set out the factors governing the assessment, including complexity, skill required, and proportionality.
   
• Time spent by counsel researching entry warrants and conferring together on file strategy was found not reasonably necessary to the proceeding.
   
• Disbursements for lead counsel's travel to Vancouver were allowed as reasonable, while photocopy charges were reduced.
   
• Ultimately, the registrar allowed special costs of $22,500 plus $2,500 for the assessment itself, for a certified total of $25,000.
   

Facts of the case

The City of Delta brought contempt proceedings against Lloyd Investments Ltd. after the company failed to comply with a 2022 order of Groves J., which had declared it in breach of a Delta bylaw and required it to obtain a business licence. David Lloyd, president of Lloyd Investments, represented the company throughout. Delta applied for a contempt finding on August 27, 2025, and the application proceeded before Latimer J. on September 15, 2025. Latimer J. declared Lloyd Investments in contempt, permitted it to purge the contempt by paying $2,000 to Delta, and ordered that Delta was entitled to special costs to be determined by the registrar. Lloyd Investments purged its contempt before the sentencing hearing proceeded before Groves J. on December 8, 2025, who imposed a suspended sentence and ordered Lloyd Investments to pay special costs of the application. Delta subsequently filed an appointment to assess its special costs on March 30, 2026, claiming $29,805.71 based on invoices from Dominion GovLaw LLP, the firm that acted for Delta. Registrar Gaily noted that the invoices initially exhibited to the first Currie affidavit had their narrative descriptions fully redacted to protect solicitor-client privilege. Given the redactions, the registrar converted the initial thirty-minute assessment into a pre-hearing conference and ordered unredacted bills to be served, along with particularized objections from Mr. Lloyd. The full assessment proceeded on July 10, 2026, supported by a second Currie affidavit and an affidavit from legal assistant Alex Volchek, with Mr. Lloyd cross-examining Mr. Currie on his evidence.

Policy and legislative provisions at issue

The assessment turned on Rule 14-1(3) of the Supreme Court Civil Rules, which requires a registrar to allow fees that were properly or reasonably necessary to the conduct of a proceeding, having regard to factors including the complexity and novelty of the issues, the skill and responsibility required of the lawyer, the amount involved, the time reasonably spent, conduct affecting the length of the proceeding, the importance of the proceeding and result obtained, the benefit of the services rendered, and proportionality under Rule 1-3. Rule 14-1(5) separately directs the registrar to determine which disbursements were necessarily or properly incurred and to allow a reasonable amount for them. Registrar Gaily also referenced prior authority establishing that special costs are punitive rather than compensatory, intended to censure litigation misconduct, and that an assessment is not simply a matter of deducting an arbitrary percentage from actual legal costs but requires an objective determination of reasonable costs.

Reasoning and analysis

Applying the Rule 14-1(3) factors in turn, Registrar Gaily found the proceeding was not legally complex, though contempt applications require proof beyond a reasonable doubt, which necessitated more extensive evidence-gathering than a typical chambers application. On skill and responsibility, the registrar accepted that junior counsel Mr. Currie, guided occasionally by senior partner Troy DeSouza, had the requisite competence, and that the matter did not demand specialized experience. Regarding the amount involved, the registrar acknowledged that contempt proceedings focus on compliance with a court order rather than a monetary sum, and found Delta's pursuit of the application justified. On the time reasonably spent, the registrar identified specific fees that should not have been included: time Mr. Currie spent researching the law on entry warrants, which Delta had never instructed the firm to pursue; time billed by both Mr. Currie and Mr. DeSouza for internal conferences with each other; and duplicate preparation time claimed by both lawyers for the same hearing. The registrar found no basis to fault Delta's conduct in pursuing the matter, noting that Lloyd Investments' non-compliance with the 2022 order was the underlying cause of the proceedings. The registrar accepted that the proceeding was important to Delta as a municipal government enforcing bylaw compliance, and that Delta achieved a successful result through both the Latimer and Groves orders. On proportionality, the registrar concluded the claimed fees should be somewhat reduced to reflect a reasonable and proportionate amount. Turning to disbursements, the registrar found Mr. DeSouza's travel expenses to attend the Vancouver hearing in person, including ferry, hotel, transit, and mileage charges, were necessary and proper. However, the photocopy charges of $889.25 (calculated at $0.45 per black-and-white page and $0.95 per colour page) were found excessive against the customary registrar-allowed rate of $0.25 per page, and were reduced to $500 including taxes.

Ruling and overall outcome

Registrar Gaily allowed Delta's special costs against Lloyd Investments, reduced from the $29,805.71 claimed, at $22,500 inclusive of disbursements and applicable taxes, reflecting deductions for the entry-warrant research, duplicated inter-counsel conferencing time, and the reduced photocopy disbursement. The registrar separately assessed the costs of the assessment itself at $2,500, inclusive of disbursements and taxes, noting neither party had made submissions on that point and that Delta would not be entitled to costs for an earlier appearance where its bills had been redacted. Delta was directed to prepare and file a certificate of costs in Form 64 confirming that the total special costs allowed, combined with the costs of the assessment, amount to $25,000.