In its brief decision, a Divisional Court panel decided against awarding costs because the case raised novel issues of law and Ford's narrow appeal win was not an outright victory.
Ford had sought about $116,000 in costs from Paul Magder, who almost succeeded in having the mayor ousted for participating in a council vote in which he had a financial interest.
When it came to costs, Magder argued against any award on the grounds he was acting as a public-interest litigant.
Ford, who blamed a left-wing conspiracy after the courts initially ordered him removed from office, argued Magder was "in the pursuit of a political agenda."
In nixing Ford's request for costs, the Divisional Court cited three reasons.
Firstly, even though Ford was allowed to stay in office, the court noted he was successful on only one of his four appeal grounds
In addition, the court found the proceedings helped clarify parts of the Municipal Conflict of Interest Act.
"This proceeding raised novel legal issues with respect to matters of public importance," the panel wrote.
"While we would not characterize (Magder) as a public-interest litigant just because he brought this litigation as an elector, the clarification of significant and novel legal issues is in the public interest."
Among other things, the court said, the case helped put limits on the "defence of inadvertence or error in judgment" when it comes to violating the conflict-of-interest law.
The court also noted the narrow technical grounds on which Ford won his appeal had not been raised during the initial legal action, and so it was reasonable for Magder to pursue his application.
The case began with a shocker decision in November, when Ontario Superior Court Justice Charles Hackland ordered Ford from office.
At issue was Ford's participation in a council vote that he repay $3,150 raised for his private football foundation.
Hackland stayed his decision to allow Ford to appeal, which the mayor did.
In January, Divisional Court overturned Hackland's decision despite rapping Ford's knuckles for his "wilful blindness" to the law.
It also said he had made an error in judgment that was not made in good faith.
"Wilful blindness to one's legal obligations cannot be a good faith error in judgment," the court ruled.
The technical ruling in Ford's favour turned on the fact that Toronto city council had no authority to order Ford to repay the money.
Magder is now asking the Supreme Court of Canada if it will take another look at the case.
Ford called the decision "ridiculous."
"I won it fair and square; I think Magder should pay," the mayor told reporters.
"I've got to swallow over 100 grand ... it's a lot of money."
Clayton Ruby, the lawyer who represented Magder, said Ford had "scuppered" his own request for costs with his "wilful blindness" in taking part in the vote.
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