Court File and Parties
Court File No.: 319/12 Date: 2013-04-29
Ontario Court of Justice
Re: Richard Randolph Burns – Applicant And: Angela Kathleen Krebss - Respondent
Before: S. O'Connell
Counsel:
- Richard Burns, on his own behalf
- Novalea Jarvis, for the Respondent
Costs Endorsement
Background
1The applicant, Richard Burns is seeking costs of the motion for spousal support brought by the respondent, Angela Krebss. Mr. Burns seeks compensation in the amount of $5,920.38 for lost wages, disbursements, and for the time that he spent on research, review and preparation for the motion. Mr. Burns is self-represented in this proceeding.
2The respondent sought temporary spousal support from Mr. Burns in the amount of $1,354.00 per month. Mr. Burns opposed the claim on the basis that Ms. Krebss is not entitled to spousal support because she is not a "spouse" as defined under the Family Law Act.
3On February 3, 2013, for written reasons, I dismissed Ms. Krebss' motion for spousal support. I concluded that Ms. Krebss had not made out a case for standing to claim spousal support.[1]
Position of the Applicant
4Mr. Burns submits that he was entirely successful on this motion, and therefore he should be fully compensated for the time and expense he spent representing himself on this motion, including his lost wages, and his disbursements for transcripts, faxes and legal fees. He states that in preparing for this motion, he did the work that would have ordinarily been done by a lawyer and that he should be compensated at the rate of $150.00 per hour for his time spent. The respondent's motion for spousal support and her brief of authorities contained over five hundred pages and therefore required a considerable amount of time to review.
5Mr. Burns further submits that pursuant to Rule 24(9) of the Family Law Rules, this is an appropriate case for the court to order that the costs that he incurred should be paid personally by the respondent's lawyer. He submits that the motion was unreasonable and unnecessary.
Position of the Respondent
6Ms. Krebss submits that there should be no costs awarded to Mr. Burns or alternatively that he should only receive nominal costs of $100.00 for the following reasons:
Mr. Burns has behaved unreasonably in these proceedings thus increasing the costs of the litigation. She submits that if Mr. Burns had consented to her request to move with the child to Owen Sound for employment purposes in the first place, then it would not have been necessary for her to bring the motion for spousal support.
An award for costs would have a very serious financial impact upon her and the child, given the significant disparity in the income between the two parties. Her very limited ability to pay costs should be taken into account.
Mr. Burns is a self-represented litigant, and therefore, he is not entitled to costs calculated on the same basis as those of a litigant who retains counsel.
The Governing Principles
7Rule 24 of the Family Law Rules, O. Reg. 114/99, governs the determination of costs in family law proceedings. Mr. Burns did not serve an offer to settle so the provisions under Rule 18 will not be considered.
8The sections of Rule 24 that are relevant to the circumstances of this case are as follows:
- (1) There is a presumption that a successful party is entitled to the costs of a motion, enforcement, case or appeal.
(4) Despite subrule (1), a successful party who has behaved unreasonably during a case may be deprived of all or part of the party's own costs or ordered to pay all or part of the unsuccessful party's costs.
(5) In deciding whether a party has behaved reasonably or unreasonably, the court shall examine,
(a) the party's behaviour in relation to the issues from the time they arose, including whether the party made an offer to settle;
(b) the reasonableness of any offer the party made; and
(c) any offer the party withdrew or failed to accept.
(6) If success in a step in a case is divided, the court may apportion costs as appropriate.
(7) If a party does not appear at a step in the case, or appears but is not properly prepared to deal with the issues at that step, the court shall award costs against the party unless the court orders otherwise in the interests of justice.
(8) If a party has acted in bad faith, the court shall decide costs on a full recovery basis and shall order the party to pay them immediately.
(9) If a party's lawyer or agent has run up costs without reasonable cause or has wasted costs, the court may, on motion or on its own initiative, after giving the lawyer or agent an opportunity to be heard,
(a) order that the lawyer or agent shall not charge the client fees or disbursements for work specified in the order, and order the lawyer or agent to repay money that the client has already paid toward costs;
(b) order the lawyer or agent to repay the client any costs that the client has been ordered to pay another party;
(c) order the lawyer or agent personally to pay the costs of any party; and
(d) order that a copy of an order under this subrule be given to the client.
(10) Promptly after each step in the case, the judge or other person who dealt with that step shall decide in a summary manner who, if anyone, is entitled to costs, and set the amount of costs.
9Rule 24(11) provides a further list of factors that a court should consider in dealing with costs:
A person setting the amount of costs shall consider,
(a) the importance, complexity or difficulty of the issues;
(b) the reasonableness or unreasonableness of each party's behaviour in the case;
(c) the lawyer's rates;
(d) the time properly spent on the case, including conversations between the lawyer and the party or witnesses, drafting documents and correspondence, attempts to settle, preparation, hearing, argument, and preparation and signature of the order;
(e) expenses properly paid or payable; and
(f) any other relevant matter. O. Reg. 114/99, r. 24(11).
10Rule 24 created a new framework for determining costs in family law proceedings. The presumptive nature of Rule 24 has significantly curtailed the court's discretion regarding costs in family law proceedings and absent compelling circumstances or the exceptions set out in the rule itself, costs are generally awarded to the successful party. The Ontario Court of Appeal in C.A.M. v. D.M., 67 O.R. (3d) 181 held that while the Rules have not completely removed a judge's discretion, the Rules nonetheless circumscribed the broad discretion previously granted to the courts in determining costs (paragraph 40). Courts must not only decide liability for costs, but also the amount of those costs.
11In Serra v. Serra, 2009 ONCA 395, 66 R.F.L. (6th) 40, at paragraph 8, the Ontario Court of Appeal confirmed that costs rules are designed to foster three important principles:
(1) to partially indemnify successful litigants for the cost of litigation;
(2) to encourage settlement; and
(3) to discourage and sanction inappropriate behaviour by litigants.
12The court's role in assessing costs is not necessarily to reimburse a litigant for every dollar spent on legal fees. As was pointed out in Boucher et al. v. Public Accountants Council for the Province of Ontario, 71 O.R. (3d) 291, the award of costs must be fixed in an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceedings rather than an exact measure of actual costs to the successful litigant.
13In Delellis v. Delellis and Delellis, at paragraph 9, Justice David R. Aston states the following:
"… recent cases under the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, as amended, have begun to de-emphasize the traditional reliance upon "hours spent times hourly rates" when fixing costs...Costs must be proportional to the amount in issue and the outcome. The overall objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particular circumstances of the case, rather than an amount fixed by the actual costs incurred by the successful litigant..."
Analysis
14Mr. Burns was entirely successful on this motion. He is therefore presumed to be entitled to costs. I do not agree that Mr. Burns acted unreasonably either during or prior to the motion for spousal support being brought. Mr. Burns previously opposed Ms. Krebss' urgent motion to move with their child to Owen Sound for employment because it was six hours away from both parties' home and the move would seriously interfere with his access to their child, who was only eight months old at the time. I dismissed Ms. Krebss' urgent mobility motion for that reason and also because I found that there were employment opportunities in the Greater Toronto area that she had not explored. It is worth noting that Mr. Burns did not seek costs against Ms. Krebss even though he was successful on that motion.
Costs for Self-Represented Litigants
15The case law is clear that there is no impediment to awarding costs to a self-represented litigant. In the case of Fong v. Chan, the Ontario Court of Appeal considered the recovery of costs by self-represented litigants generally. This case has been followed and applied by a number of different courts. The court stated as follows in paragraphs 26 to 28 of that decision:
"26 A rule precluding recovery of costs, in whole or in part, by self-represented litigants would deprive the court of a potentially useful tool to encourage settlements and to discourage or sanction inappropriate behaviour. For example, an opposite party should not be able to ignore the reasonable settlement offer of a self-represented litigant with impunity from the usual costs consequences. Nor, in my view, is it desirable to immunize such a party from costs awards designed to sanction inappropriate behaviour simply because the other party is a self-represented litigant.
27 I would add that nothing in these reasons is meant to suggest that a self-represented litigant has an automatic right to recover costs. The matter remains fully within the discretion of the trial judge, and as Ellen Macdonald J. observed in Fellows, McNeil v. Kansa, there are undoubtedly cases where it is inappropriate for a lawyer to appear in person, and there will be cases where the self-represented litigant's conduct of the proceedings is inappropriate. The trial judge maintains a discretion to make the appropriate costs award, including denial of costs.
28 I would also add that self-represented litigants, be they legally trained or not, are not entitled to costs calculated on the same basis as those of the litigant who retains counsel. As the Chorley case recognized, all litigants suffer a loss of time through their involvement in the legal process. The self-represented litigant should not recover costs for the time and effort that any litigant would have to devote to the case. Costs should only be awarded to those lay litigants who can demonstrate that they devoted time and effort to do the work ordinarily done by a lawyer retained to conduct the litigation, and that as a result, they incurred an opportunity cost by foregoing remunerative activity. As the early Chancery rule recognized, a self-represented lay litigant should receive only a "moderate" or "reasonable" allowance for the loss of time devoted to preparing and presenting the case. This excludes routine awards on a per diem basis to litigants who would ordinarily be in attendance at court in any event. The trial judge is particularly well-placed to assess the appropriate allowance, if any, for a self-represented litigant, and accordingly, the trial judge should either fix the costs when making such an award or provide clear guidelines to the Assessment Officer as to the manner in which the costs are to be assessed."
16Regarding Mr. Burns' claim for lost wages, it is unclear whether the lost wages being claimed is for the time he spent to review and prepare for the motion for spousal support or for the time he spent to attend court. However, Mr. Burns should be compensated for the time spent reviewing and preparing for this motion. The quality of Mr. Burns' work and documentation was excellent for a self-represented party. He was well organized and well prepared. The issue was somewhat complicated and he presented his arguments clearly and concisely. In my view, Mr. Burns should be compensated at the rate fixed by Mr. Justice Pazaratz in the decision of Izyeuk v. Bilousov, 2011 ONSC 7476. In that case, the court set the hourly rate for the self-represented litigant, who was also very well prepared, at $100.00 per hour.
Ability to Pay
17I must also consider clause 24(11)(f) which requires the court to consider any other relevant matter, including the ability of the losing party to pay costs. Ms. Krebss is a single mother with a very limited income. I have carefully considered this and the impact of a cost award on the child, who primarily resides with her.
18In C.A.M. v. D.M., 67 O.R. (3d) 181 (C.A.), Justice Rosenberg for the Ontario Court of Appeal states the following regarding the ability to pay costs:
"I am also of the view that the financial situation of the parties can be taken into account in setting the amount of the costs award either under Rule 24 or Rule 18. Thus, while subrule 24(11) enumerates a number of factors that must be taken into account, the person setting the amount of the costs is directed to take into account "any other relevant matter". I agree with Aston J. in Sims-Howarth at para. 4, that the "Family Law Rules demand flexibility in examining the list of factors in subrule 24(11) without any assumptions about categories of costs". In my view, a consideration of particular relevance may be the financial position of the parties, especially of an unsuccessful custodial parent. See Biant v. Sagoo at para. 17 and Brennan v. Brennan, [2002] O.J. No. 4743 (S.C.J.) at para. 11. In fixing costs the courts cannot ignore the best interests of the child and thus cannot ignore the impact of a costs award against a custodial parent that would seriously affect the interests of the child." [par. 42]
19Nevertheless, individuals of limited means should not be able to conduct litigation with impunity. The ability to pay costs is relevant to the quantum of costs but not to another party's entitlement to costs. A party's limited finances may not be used to shield liability particularly when the course of litigation was misguided or unreasonable. As Justice Spence stated in Peers v. Purpore, 2008 ONCJ 615"in family law litigation, and particularly for parties of modest means, it behoves those parties to act reasonably and to avoid trial if at all possible."
20In my view, in the circumstances of this case, a cost award is appropriate. But for Ms. Krebss' financial circumstances, I would have been inclined to make a costs award in the range of $3,000.00 to $4,000.00. However, in considering all of the circumstances, costs will be fixed at $1,500.00, inclusive of fees, disbursements and taxes.
Whether Costs Should Be Paid by Ms. Krebss' Counsel
21As I indicated before, this motion appeared misguided, given the legislation and the law with respect to the entitlement to spousal support in the circumstances of this case. Mr. Burns submits that this may be an appropriate case for Ms. Krebss' lawyer to personally pay the costs awarded.
22The case law is clear that costs against a lawyer personally should only be granted in exceptional circumstances. See Galganov v. Russell (Township), 2012 ONCA 410. The governing principles in awarding costs personally against a lawyer were set out by the Supreme Court of Canada in Young v. Young, [1993] 4 S.C.R. 3 at pages 135 to 136:
"The basic principle on which costs are awarded is as compensation for the successful party, not in order to punish a barrister. Any member of the legal profession might be subject to a compensatory order for costs if it is shown that repetitive and irrelevant material, and excessive motions and applications, characterized the proceedings in which they were involved, and that the lawyer acted in bad faith in encouraging this abuse and delay. It is clear that the courts possess jurisdiction to make such an award, often under statute and, in any event, as part of their inherent jurisdiction to control abuse of process and contempt of court. ... [C]ourts must be extremely cautious in awarding costs personally against a lawyer, given the duties upon a lawyer to guard confidentiality of instructions and to bring forward with courage even unpopular causes. A lawyer should not be placed in a situation where his or her fear of an adverse order of costs may conflict with these fundamental duties of his or her calling." [Emphasis in original.]
23In my view, this is not an appropriate case for costs to be paid personally by Ms. Jarvis. I do agree that the amount of material prepared by Ms. Jarvis appeared excessive and unnecessary. However, there is no suggestion that she was acting in bad faith or deliberately bringing a motion that she knew would be unsuccessful to cause more delay. Further, Ms. Jarvis was presumably acting on her client's instructions and attempting to advance her interests. I assume that she proceeded with confirmed instructions after careful consideration and consultation with her client.
Order
24The Respondent shall pay to the Applicant costs in the amount of $1,500.00, inclusive of fees, disbursements and taxes. These costs shall be paid no later than 30 days from the date of this order, or to be paid at a rate of $100.00 per month, commencing June 1, 2013.
Justice Sheilagh O'Connell
Date: April 29, 2013
