An Ontario Superior Court judge has denied CIBC’s motion for costs in a mortgage default case, ordering costs for the defendant instead, branding the bank’s behaviour in the case “arrogant” and “high-handed”.

The case involves a mortgage held by CIBC that technically fell into default. The bank and the defendants ultimately agreed on the amount required to bring it into good standing, however the bank sought costs $10,615.50 for bringing the case to court.

The judge, however, dismissed the bank’s claim for costs, and awarded costs to the defendants instead. The decision notes that notwithstanding a contractual provision that may entitle the bank to claim costs, the court retains a discretion to award costs on any basis that it considers just.

“In my view, the conduct of the bank in this case has been high-handed. To describe it as arrogant is not an overstatement,” the decision says. ”The uncontradicted evidence is that the cause of the alleged default was the refusal of the bank to accept the McDonalds’ payments. Requests for information were ignored, and were met by Notices of Sale and the commencement of these proceedings.”

It adds that, “This came hard on the heels of the discontinuance of an earlier mortgage action, and ultimately the late payment of costs for that proceeding. To make matters worse, the bank reneged on an agreement that it would accept the arrears and try to sort out the matter of costs later.”

“If the bank had acted in a more responsible manner, I have no doubt that this litigation would have been entirely avoided. As indicated earlier, the bank’s conduct throughout has been high-handed and arrogant. In my view, not only should the bank be deprived of its costs, it should pay costs to the defendants,” it says.

As a result, it awarded costs of $10,000 to the defendants.