Alberta issued a "Requirement to Pay" (RTP) related to a tax debt owed by Merchant Law Professional Corporation.
The Bank of Montreal froze funds in Merchant Law Group LLP’s account, not knowing whether they could be used to pay the debt.
BMO sought an interpleader order to resolve the competing claims to the funds, and the court allowed it to deposit the $80,000 in dispute into the court.
Merchant Law Group LLP unsuccessfully appealed this decision.
· Key Issues:
The allocation of costs after the unsuccessful appeal and related proceedings.
Alberta argued that no costs should be awarded because the issue was novel under Alberta’s tax laws.
· Ruling:
The court found that BMO was entitled to costs as it acted reasonably by seeking interpleader relief.
Alberta and Merchant Law Group LLP were held jointly and severally liable for the costs incurred by BMO, as they continued litigation unnecessarily after the funds were deposited.
Merchant Law Group LLP, though unsuccessful in the appeal, was awarded costs for its successful claim to the disputed funds, with Alberta solely responsible for those costs.
· Costs:
BMO: Awarded $27,300 in costs, shared equally by Alberta and Merchant Law Group LLP. Additionally, $787.97 in disbursements
Merchant Law Group LLP: Awarded $16,500 in costs, payable by Alberta alone.
There were no damages awarded in this case; the focus was on the allocation of costs. Therefore, the total monetary award for costs and disbursements was $44,587.97.
