Law360 Canada ( May 4, 2026, 9:35 AM EDT) -- Appeal by Strata from a chambers judge’s refusal to strike the respondents’ negligence claim. The underlying litigation concerned disputes over governance of a strata property, including allegations against the 2019 and 2020 Strata Council members relating to conflict of interest issues, lease renewals with Victoria Regent Hotel Ltd., and a 2021 Release. After various petitions, amendments, and the dismissal of claims against individuals, the respondents filed a Further Amended Notice of Civil Claim (FANOCC) alleging four heads of negligence against the Strata and pleading that their damage or loss consisted entirely of their legal costs in prosecuting the litigation. The Strata applied to strike the FANOCC, arguing that the claim was bound to fail because costs cannot be recovered as damages and because no duty of care arose to protect against pure economic loss. The chambers judge held it was not plain and obvious the FANOCC disclosed no cause of action, reasoning that foreseeability and proximity were arguable and distinguishing between costs arising from litigation conduct and costs arising from antecedent negligent acts. On appeal, the Strata submitted the chambers judge erred by failing to apply the longstanding rule that litigation costs cannot be claimed as damages in the same proceeding, and by failing to analyze the negligence claim through the restrictive framework governing pure economic loss. The respondents argued the claim was viable because costs could be re‑characterized as damages arising from negligent acts preceding litigation, and a legislative gap in the Strata Property Act justified allowing owners to recover legal costs incurred to compel statutory compliance....