Liliana Kostic must pay enhanced legal costs to the defendants in her lawsuit against a law firm and a separate $600 penalty to the court after a judge found that her conduct had unnecessarily complicated earlier applications.
In Kostic v Scott Venturo Rudakoff LLP, 2026 ABKB 743, issued October 27, 2026, Justice M.A. Marion of the Court of King’s Bench of Alberta awarded the law-firm defendants $13,334 plus GST and the Attorney General of Alberta $2,360, all-inclusive. Those application costs are payable immediately, regardless of the eventual outcome of the action.
The decision concerns costs and a civil-procedure penalty, not a final ruling on Kostic’s underlying claims against the firm and its lawyers. A further $750 plus GST for the costs process itself remains subject to any settlement offers submitted for the judge’s consideration within one week of the reasons.
Earlier applications set the stage
The costs followed a September decision, 2026 ABKB 626, in which Marion granted the defendants security for costs on terms, dismissed Kostic’s applications seeking advance funding and other relief, and refused permission for a proposed records-production application. Security for costs protects a responding party’s ability to recover a future costs award; it is distinct from the application costs now ordered.
The October reasons record that Kostic had appealed the earlier decision. Marion declined to use the costs proceedings to revisit alleged errors, saying those issues belonged before the Court of Appeal. He also noted that the action remained stayed under the security-for-costs order and that, to his knowledge, Kostic had neither posted the required security nor obtained a stay of that order.
Kostic opposed enhanced costs, challenged whether the defendants had proved their expenses and argued that unsuccessful litigation positions did not amount to misconduct. She sought ordinary tariff costs without multipliers and asked that any payment await determination or satisfaction of asserted indemnity obligations owed by others.
The judge refused to defer the costs determination or payment. The successful respondents should not have to wait for an uncertain future decision about possible indemnity rights against non-parties, he found. The merits of those asserted rights were not before him.
Enhancement did not apply to every step
The law-firm defendants sought approximately $19,000 to $24,000. Marion instead used column 4 of Schedule C, the Rules of Court’s costs tariff, and arrived at a materially lower award.
He accepted a 1.25 inflation adjustment and a 1.5 multiplier for complexity caused by Kostic’s litigation conduct. His findings included pursuing relief not properly before the court and relying on fictitious case citations, including in a sworn affidavit. Kostic disputed the fictitious-citation allegation, while acknowledging that an improper reference might have resulted from inadvertence or carelessness.
But the judge tailored the conduct multiplier rather than applying it across the bill. He excluded it from two court-directed case-management conferences and a reasonable extension request. He also reduced one conference claim because the conference addressed several actions and other issues, and added $675 to account for the defendants’ additional concise briefs.
Marion agreed that solicitor-client costs were not warranted. He considered Kostic’s self-represented status and accepted her response despite its failure to follow the original costs-submission directions, finding no prejudice from deciding the matter without further responses.
The resulting award to the law-firm defendants consists of $12,834 in legal fees and $500 in disbursements, plus GST. The $500 was a discretionary lump sum: the defendants had not provided proof of the claimed disbursements. The attorney general’s separate $2,360 claim was found conservative and reasonable.
Separate penalty for pursuing struck relief
The $600 penalty, payable immediately to the court clerk, addressed Kostic’s continued pursuit of relief the judge had expressly struck and had not permitted to proceed. Marion found that this disregard of his directions complicated the applications and interfered with the efficient administration of justice.
For the subsequent costs process, he found $750 plus GST in favour of the law-firm defendants appropriate, but allowed a week for any settlement offers on application costs to be submitted. Unless such offers were provided, that would become his costs order for the costs process. No additional costs-of-costs award was made to the attorney general.
