Misconceptions About Costs Awards

Many regulators are permitted to require registrants to pay some or all of the costs of a discipline hearing if a finding is made against the registrants. Generally, regulators are allowed a fair degree of latitude in selecting the amount of costs awarded. However, if the amount is based on an incorrect assumption, a court will intervene.

In Dr. Ignacio Tan III v Alberta Veterinary Medical Association, 2022 ABCA 221 (CanLII), https://canlii.ca/t/jptvr a veterinarian was disciplined for inappropriate care, communications and record keeping related to the treatment of a pet dog. The hearing tribunal’s finding were upheld at an internal appeal within the regulator. The internal appeal body ordered the registrant to pay 80% of the costs of the internal appeal amounting to $23,000. On appeal to the Court the findings of misconduct were upheld. However, the proportion of the costs of the internal appeal payable by the registrant was reduced to 50%.

The Court noted that with the privilege of self-regulation:

… comes the responsibility to supervise and, when necessary, discipline members. The disciplinary process must necessarily involve costs, and any professional regulator must accept some of those costs as an inevitable consequence of self-regulation. It is acceptable for the profession to attempt to recover some of those costs back from disciplined members, but some burden of the costs of regulation is unavoidable and a proper consequence of the regulator’s mandate.

The Court noted that while it is appropriate to transfer some of these costs to the registrant where a finding is made,

… full indemnity for costs is seldom appropriate. Leaving some of the burden of the costs of disciplinary proceedings on the professional regulator helps to ensure that discipline proceedings are commenced, investigated, and conducted in a proportional matter, with due regard to the expenses being incurred.

In addition, the “… disciplinary system should not include a cost regime that precludes professionals [from] raising a legitimate defence”.

In this case, the Court found that the appeal body fell into the misapprehension that there was a presumption or expectation that the registrant should pay most or all of the costs. The Court concluded in all of the circumstances that the registrant should only be expected to pay half of the costs of the internal appeal.

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