RioCan-HBC: $400,000 in Yorkdale costs against the estate, not the receiver

On February 9, 2026 the court dismissed the receiver's motion to approve a sublease of the Yorkdale Mall premises formerly occupied by Hudson's Bay — space held under a head lease from Oxford and subleased to HBC, per *Riocan Real Estate Investment Trust v. 2455034 Ontario Limited Partnership*, 2026 ONSC 2204, paras. 1–2.

Oxford, having won, asked for $707,229.66 — and asked that FTI Consulting Canada Inc. pay it personally.

It got $400,000, from the estate. The reasoning is the most useful survey of costs in restructuring proceedings to appear this year.

Costs are unusual here, and why

The starting point is that a successful party in a restructuring often gets nothing.

As the endorsement puts it, drawing on YG Limited Partnership and YSL Residences (Re), a restructuring is often not a "classic adversarial civil proceeding"; the statute is intended to provide a "forum for stakeholder views to be brought forward, considered, and taken into account". Where that is what happened, the fact that the court preferred one stakeholder's view does not mean that stakeholder is entitled to costs, per 2026 ONSC 2204, paras. 7, 10.

Two extensions are worth noting. The principles from the HBC Costs Decision, In Re Hudson's Bay Company, 2026 ONSC 1331, made under the CCAA, apply equally in a BIA receivership. And costs remain discretionary under s. 131 of the Courts of Justice Act, analysed in three stages — entitlement, scale and quantum — with a fourth question added here: who should pay, and when.

What took this motion out of the ordinary is that it was not really a stakeholder consultation:

Oxford and RioCan are direct competitors in the Canadian retail mall market. Oxford was engaged in a commercial dispute about its contractual rights and obligations and was at odds with, among others, one of its direct competitors that was propounding the Fairweather Sublease that Oxford was not willing to consent to. Both had economic interests at stake. Oxford's position prevailed, following an adjudication that was more in the nature of a "classic adversarial proceeding".

Per 2026 ONSC 2204, para. 12.

The receiver had entered into the sublease and was recommending it — but the real dispute, the lis, was between Oxford as landlord and RioCan, the first secured creditor of the debtor, which had been "very much involved in the arrangements" and had agreed to fund the rent deficiency between what was owing under the HBC sublease and what the new subtenant would pay, for as long as that remained in its economic interest, per 2026 ONSC 2204, para. 11.

The judicial notice

Before reaching the exception, the court confirms the rule — and does so in an unusually candid way.

The receiver argued it would be unusual for costs to be awarded when a court declines to approve a transaction proposed by a court officer. Oxford complained there was no authority for that proposition. Kimmel J.'s answer:

having sat on the Commercial List now for more than four years, I have no hesitation in taking judicial notice that this is, indeed, the case. This is at least, in part, because the court encourages court officers to explore value maximizing transactions and would not want an adverse costs award to serve as a disincentive to the court officer or to other market participants to explore these transactions.

Per 2026 ONSC 2204, para. 13.

That is worth having in a citable form. Court officers propose transactions that fail; if every failed approval motion carried a costs risk, officers would stop proposing anything creative, and counterparties would stop engaging with them.

The judge was satisfied that charging the estate here would not create that deterrent — because of who really bears it.

Not the receiver, personally

Oxford relied on two authorities for personal liability, and the endorsement distinguishes both in a way that maps the boundary usefully, per 2026 ONSC 2204, para. 19:

*Haunert-Faga v. Faga* concerned a receiver seeking advance costs immunity for litigation it was pursuing as a party outside the bankruptcy proceeding. It was refused because pursuing litigation is a business decision a receiver makes, and blanket advance immunity is not available for it.

*Akagi v. Synergy Group (2000) Inc.*, 2015 ONCA 771, is the leading case, and the language is the test: receivers only rarely incur personal liability for costs, but that protection "does not apply where the receiver turns itself into a 'real litigator', impermissibly drawing others into the fray and forcing them to defend themselves in what amounts to a process that is extraneous to the creditor-driven receivership". In Akagi the receiver had taken an investigative receivership too far — treating it as akin to a criminal investigation or public inquiry — and had to bear the consequences when the orders were set aside.

Neither applied:

I do not consider there to be any basis on which to hold the Receiver in this case, acting in the normal course of its duties to bring forward a potential transaction for the court's approval, even if at the behest of a significant secured creditor, to be held personally liable to Oxford for its costs. There has been no finding that the Receiver was not acting in good faith or that it stepped outside of the bounds of its mandate, nor was the Receiver pursuing litigation outside of the restructuring proceeding.

Per 2026 ONSC 2204, para. 20.