Court File and Parties

Court File No.: Toronto D58029/12 Date: 2017-06-06 Ontario Court of Justice

Between:

Eileen Rijo Applicant

— And —

Ja Hyun (Courtney) Choi and Aleksandor Rafael Szajko-Rijo Respondents

Before: Justice C. Curtis

Written submissions regarding Costs

Endorsement released on 6 June 2017

Counsel:

• Applicant Paternal Grandmother: Unrepresented
• Respondent Mother: Dumoluhle Siziba
• Respondent Father: Unrepresented

Index

1. Over-view
2. The Parties' Positions re Costs
3. Litigation History
4. The Costs Analysis
5. Order

Over-view

This is the decision regarding costs of an application brought by the paternal grandmother against the parents, for custody of and access to her grandchildren. The application settled with sole custody to the mother, on 10 February 2016, after the case was scheduled for trial.

The Parties' Positions re Costs

The mother claims costs of this matter under Rule 24 of the Family Law Rules, in the amount of $20,249.60 all in (fees plus disbursements).

The father claims costs of this matter under Rules 18 and 24 of the Family Law Rules, in the amount of $18,055 all in (fees plus disbursements).

The paternal grandmother asks that there be no order as to costs for either parent.

Background

The applicant Eileen Rijo is the paternal grandmother of the children. She is 47 years old (born 18 June 1969).

The respondents are the parents of the children. The mother is Ja Hyun Courtney Choi, 30 years old (born 16 December 1986). The father is Aleksandor Rafael Szajko-Rijo, 37 years old (born 10 February 1980). The parents were married on 27 June 2007, and separated on 21 January 2013. There are two children of the marriage:

• Leon, born 27 April 2009 (8 years old)
• Sean, born 27 June 2011 (5 years old)

Litigation History

This case was high conflict litigation, brought in two locations over a period of many years. There was a great deal of animosity between the parties, and there were many court appearances. Below is a summary of the litigation (not all court dates are shown).

Date	Description of Court Case	Outcome
12 December 2012	Paternal grandmother started a court case (at this courthouse, at 47 Sheppard Ave. E., Toronto) seeking (among other things) detailed and specified access to the children (who were then 3 and 1½ years old). The children had stayed with her for one month (October to November 2012) at the request of the parents, who were going through marital conflict.
14 December 2012	Paternal grandmother withdraws application on the basis that the matter is resolved. An unsigned document is filed setting out what paternal grandmother says are the terms of an agreement.
16 January 2013	The paternal grandmother started a court case (at the Barrie courthouse) seeking custody and child support, and brings a motion without notice for custody, support, police enforcement.	Olah, J. order for motion to be served, non-removal from Barrie jurisdiction, temporary without prejudice custody to paternal grandmother.
22 January 2013		Wood, J. order temporary without prejudice on consent custody to mother, detailed access order to paternal grandmother every other weekend, case transferred to Toronto court.
5 December 2014	Case conference	Curtis, J. temporary without prejudice order changing access to every 3rd weekend starting 5 December 2014; involvement of Children's Lawyer requested.
27 January 2015		Request for involvement of Children's Lawyer is refused.
5 June 2015		Case set down for summary judgment motion.
29 September 2015		Paternal grandmother withdraws claim for custody; Nevins, J. final consent orders custody to mother, travel and passport orders; access unresolved; summary judgment motion withdrawn.
24 November 2015	Settlement conference	Trial to be a 2 day Rule 1 hearing; father's access to be reasonable access on reasonable notice.
6 January 2016	Assignment court	Trial set for 7-11 March 2016.
10 February 2016		Paulseth, J. final consent order access to paternal grandmother at mother's discretion; mother is seeking costs; paternal grandmother requires leave for motion to change, request for leave not to be served on other side.

The Costs Analysis

The Law of Costs

Entitlement

The courts have a broad discretion to award costs. The general discretion of the courts regarding costs is contained in the Courts of Justice Act, R.S.O. 1990, c. C. 43, as amended, s. 131(1), which sets out three specific principles:

a) the costs of a case are in the discretion of the court;

b) the court may determine by whom costs shall be paid; and,

c) the court may determine to what extent the costs shall be paid.

Modern costs rules are designed to foster three fundamental purposes: Fong v. Chan, 46 O.R. (3d) 330, 181 D.L.R. (4th) 614, para. 24:

(a) to indemnify successful litigants for the cost of litigation;

(b) to encourage settlement; and

(c) to discourage and sanction inappropriate behaviour by litigants.

Rule 2(2) of the Family Law Rules adds a fourth fundamental purpose for costs: to ensure that the primary objective of the rules is met – that cases are dealt with justly. This provision needs to be read in conjunction with Rule 24 of the rules: Sambasivam v. Pulendrarajah, 2012 ONCJ 711 .

The Evolution of Costs as an Instrument of Social Policy

The traditional purpose of an award of costs was to indemnify the successful party in respect of the expenses sustained. For some time, however, courts have recognized that indemnity to the successful party is not the sole purpose, and in some cases not even the primary purpose, of a costs award. The principle of indemnification, while paramount, is not the only consideration when the court is called on to make an order of costs; indeed, the principle has been called "outdated" since other functions may be served by a costs order, for example to encourage settlement, to prevent frivolous or vexatious litigation, and to discourage unnecessary steps. This change in the common law was an incremental one when viewed in the larger context of the trend towards awarding costs to encourage or deter certain types of conduct, and not merely to indemnify the successful litigant: British Columbia (Minister of Forests) v. Okanagan Indian Band, [2002] S.C.R. 371 (S.C.C.), paras. 21-24.

The traditional approach to costs can also be viewed as being animated by the broad concern to ensure that the justice system works fairly and efficiently. Because costs awards transfer some of the winner's litigation expenses to the loser, rather than leaving each party's expenses where they fall, they act as a disincentive to those who might be tempted to harass others with meritless claims. In addition, because they offset to some extent the outlays incurred by the winner, they make the legal system more accessible to litigants who seek to vindicate a legally sound position. These effects of the traditional rules can be connected to the court's concern with overseeing its own process and ensuring that litigation is conducted in an efficient and just manner. In this sense it is a natural evolution in the law to recognize the related policy objectives that are served by the modern approach to costs: British Columbia (Minister of Forests) v. Okanagan Indian Band, 2002, S.C.C., supra, para. 26.

Modern costs rules accomplish various purposes in addition to the traditional objective of indemnification. An order as to costs may be designed to penalize a party who has refused a reasonable settlement offer. Costs can also be used to sanction behaviour that increases the duration and expense of litigation, or is otherwise unreasonable or vexatious. In short, it has become a routine matter for courts to employ the power to order costs as a tool in the furtherance of the efficient and orderly administration of justice: British Columbia (Minister of Forests) v. Okanagan Indian Band, 2002, S.C.C., supra, para. 25.

When awarded on a full recovery scale, costs can serve to express the court's disapproval of unreasonable conduct during the litigation: Prinzo v. Baycrest Centre for Geriatric Care, 60 O.R. (3d) 474, 215 D.L.R. (4th) 31 (Ont. C.A.), para. 76.

Costs and Ability to Pay

Ability to pay may be relevant to the issue of the quantum or scale of costs, but not to another party's entitlement to costs: Izyuk v. Bilousov, 2011 ONSC 7476, 7 R.F.L. (7th) 358 (Ont. Sup. Ct.), para. 51.

Success is given presumptive pre-eminence in Rule 24. While Rule 24(11)(f) does permit the consideration of ability to pay (under the umbrella of "any other relevant matter"), it is given significantly less prominence than the presumption that costs will follow success: Biant v. Sagoo, [2001] O.T.C. 695, 20 R.F.L. (5th) 284 (Ont. Sup. Ct.).

Ability to pay alone cannot, nor should it, over-ride the other factors in Rule 24(11): Peers v. Poupore, 2008 ONCJ 615 (Ont. Ct.), para. 42.

The (financial) means of the unsuccessful party may not be used to shield her from liability for costs, particularly when she has acted unreasonably: Gobin v. Gobin, 2009 ONCJ 278 , 71 R.F.L. (6th) 209 (Ont. Ct), para. 24.

Offers to Settle

Offers to settle are a significant part of the landscape in family law in Ontario. They are important to the possible resolution of cases. In addition, they are important to determining costs.

Parties and their lawyers have a positive obligation to behave in ways which enable the court to move cases forward to resolution (Rule 2). Rule 2(4) imposes a duty on parties and their lawyers to promote the primary objective of the rules to deal with cases justly (Rule 2(2)). This includes taking appropriate steps to save time and expense (Rule 2(3)). Offers to settle play an important role in saving time and expense by promoting settlements, focusing parties and often narrowing issues in dispute: Laing v. Mahmoud, 2011 ONSC 6737.

Offers to settle are important and can be the yardstick by which to measure success. They are significant in determining both liability for costs and quantum: Osmar v. Osmar, 8 R.F.L. (5th) 387 (Ont. Sup. Ct.), para. 7.

In deciding whether a party has acted reasonably or unreasonably in a case, the court shall examine the reasonableness of any offer the party made (Rule 24(5)(b)): M. (J.V.) v. P. (F.D.), 2011 CarswellOnt 13510, ONCJ 616, [2012] W.D.F.L. 2168 (Ont. C.J.).

To determine whether a party has been successful, the court should take into account how the order compares to any settlement offers that were made: Lawson v. Lawson, [2008] W.D.F.L. 3600 (Ont. Sup. Ct.). The position each party took in the case should also be examined.

The costs consequences of offers to settle are set out in Rule 18(14) as follows:

Costs Consequences of Failure to Accept Offer

Rule 18(14). A party who makes an offer is, unless the court orders otherwise, entitled to costs to the date the offer was served and full recovery of costs from that date, if the following conditions are met:

1. If the offer relates to a motion, it is made at least one day before the motion date.
2. If the offer relates to a trial or the hearing of a step other than a motion, it is made at least seven days before the trial or hearing date.
3. The offer does not expire and is not withdrawn before the hearing starts.
4. The offer is not accepted.
5. The party who made the offer obtains an order that is as favourable as or more favourable than the offer.

The court has a discretion to take into account any written offer to settle, the date it was made and its terms, even if Rule 18(14) does not apply to the offer to settle, when exercising its discretion over costs (Rule 18(16)).

Costs — Discretion of Court

Rule 18(16). When the court exercises its discretion over costs, it may take into account any written offer to settle, the date it was made and its terms, even if subrule (14) does not apply.

Rule 18(16) invites consideration of any and all offers to settle: Osmar v. Osmar, 2000, Ont. Sup. Ct., supra, para. 7.

It was quite difficult to sort out if there were Offers to Settle made by the parties and what offers were made. It appears that all three parties made Offers to Settle. However, the offers were not easy to locate in the materials filed as written submissions.

The paternal grandmother made an Offer to Settle dated 1 February 2016 for access four weekends a year, every three months, dates at the mother's discretion. She says that she made numerous Offers to Settle, but other offers were not part of her costs submissions.

The mother's Offer to Settle dated 23 September 2015 was an offer for sole custody to the mother and access to the paternal grandmother in the mother's discretion. The offer included a provision for costs of $5,000 payable by the paternal grandmother.

The father served three Offers to Settle (in 2013 and in September 2015). These offers were described and referenced in written submissions, but only one was provided to the court, and the exact dates of the other offers and the dates of service are unknown. The father offered on 31 August 2015 sole custody to the mother, and access to the paternal grandmother during the father's access and at his discretion.

Legal Representation

The paternal grandmother was mostly unrepresented in the litigation. The mother was represented for some of the litigation. The father was unrepresented.

Unrepresented litigants may be awarded costs and such costs may include allowances for counsel fees: Fong v. Chan, 1999, Ont. C.A., supra, para. 23.

Costs for unrepresented litigants is a matter fully within the discretion of the judge, who is particularly well-placed to assess the appropriate allowance for an unrepresented litigant: Fong v. Chan, 1999, Ont. C.A., supra, paras. 27, 28.

The right of an unrepresented litigant to recover costs is not automatic. Quantification of those costs may be difficult. But without the option of awarding meaningful costs to unrepresented litigants, the court's ability to encourage settlements and discourage inappropriate behaviour will be greatly diminished: Izyuk v. Bilousov, 2011, Ont. Sup. Ct., supra, para. 40.

Determination of costs for unrepresented litigants should take into account all of the objectives which costs orders should promote. Rules 18 and 24 of the Family Law Rules apply. Otherwise the resulting amount can render the entitlement to costs illusory, undermine access to justice by unrepresented litigants, and frustrate the administration of justice: Izyuk v. Bilousov, 2011, Ont. Sup. Ct., supra, para. 40.

The difficulty in the valuing of the time and effort of the unrepresented litigant is not a good reason to decline to value it: Jahn-Cartwright v. Cartwright, 2010 ONSC 2263, [2010] W.D.F.L. 5400, 91 R.F.L. (6th) 301 (Ont. Sup. Ct.), para. 63.

The quality of the unrepresented litigant's work and documentation must be considered, and its impact on hearing time and trial results. The emphasis must be on the value of the work done. This encompasses both the value of the work to the court and the value of the time spent to the litigant who performed the work: Izyuk v. Bilousov, 2011, Ont. Sup. Ct., supra, para. 40.

Behaviour of the Parties

One of the purposes of costs is to change behaviour.

The justice system is a precious public resource. Access to the justice system by individuals must be balanced with the need to ensure that the resource is available for all those who need it. This is one of the purposes of Rule 2.

Family law litigants are responsible for and accountable for the positions they take in the litigation: Heuss v. Sarkos, 2004 ONCJ 141, 132 A.C.W.S. (3d) 1112 (Ont. Ct.), and Peers v. Poupore, 2008 ONCJ 615 (Ont. Ct.), para. 62.

Parties to litigation must understand that court proceedings are expensive, time-consuming and stressful for all concerned. They are not designed to give individual litigants a forum for carrying on in whatever manner they may choose, oblivious to the impact of that conduct on the other side and, perhaps most importantly for the purposes of this case, oblivious to the mounting costs of the litigation: Heuss v. Sarkos, 2004, Ont. Ct., supra, para. 20.

Matrimonial litigation is an occasion for sober consideration and thoughtfulness rather than intemperate behaviour: Heuss v. Sarkos, 2004, Ont. Ct., supra, para. 20.

Rule 24(5) provides criteria for determining the reasonableness of a party's behaviour in a case (a factor in Rule 24(11)(b)). It reads as follows:

Decision on Reasonableness

(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.

A finding of bad faith is not a condition precedent to full recovery of costs by the other side under the Family Law Rules: Osmar v. Osmar, 2000, Ont. Sup. Ct., supra, para. 11.

The unreasonable conduct of an unsuccessful litigant is a factor in both the awarding of costs and in fixing the amount of costs. The court should express disapproval of a litigant who proceeds to trial without adequate evidence to prove her claims, and should send the message that the successful party should have redress by awarding costs on a full recovery basis.

The dynamics on this case are all too common, and cry out for judicial response. In a troubled economy there are more unrepresented parties in family court, and certainly more people with limited finances. Inevitably, these ingredients create greater strains on the administration of justice. Combined with limited judicial resources, the need to encourage settlement and discourage inappropriate behaviour by litigants has never been more pressing: Izyuk v. Bilousov, 2011, Ont. Sup. Ct., supra, para. 58.

It must be made clear to family law litigants that there is no right to a day in court, or at least, that the right to a day in court is tempered with the requirement that the parties take a clear-headed look at their case before insisting on their day in court. The court must sanction this behaviour clearly, or it will invite more of this behaviour.

This case should not have come to court at all. There are alternatives to litigation (negotiations by lawyers, mediation) that ought to have been considered to resolve these disputed issues. Courts must have control over the time and resources allocated to one family. This family has had more than its fair share of those resources.

The paternal grandmother made claims that were unreasonable in the circumstances and in which she was unsuccessful. Courts must discourage this behaviour. Unless courts discourage this behaviour, it will continue and increase. Orders for costs are one way to discourage this behaviour.

The conduct of the paternal grandmother throughout the case directly contributed to the time, effort required and the length of the case. The paternal grandmother pursued custody of the children from December 2012 until 29 September 2015 (for almost three years), when there was a consent final order for custody to the mother. The paternal grandmother was quite insistent in her claims and was particularly persistent in pursuing them. She presented and pursued her claims with an air of entitlement that was quite startling. She pleaded her claims and conducted herself throughout as though she were one of the parents in this case.

Once the paternal grandmother's claim for custody was withdrawn (29 September 2015), she wanted a specified and detailed access order. The mother wanted an order for access to the paternal grandmother at the mother's discretion. Even after final custody was resolved the paternal grandmother continued to pursue the access she had claimed from the start for several more months, until the access issue was settled on 10 February 2016. The final consent order was for access at the mother's discretion, the position the mother had taken.

The paternal grandmother was unreasonable in the court case, consistently, throughout, and repeatedly.

The Hourly Rate Issue

One of the mother's lawyers presented (in part) a summary of costs showing a reduced hourly rate ($109.14, the legal aid rate for this lawyer). The mother's other lawyer also showed a reduced hourly rate (rates ranging from $115 to $125 per hour). There was no evidence provided about either lawyer's usual hourly rate, or either lawyer's years of experience as a lawyer.

Lawyers should be encouraged to provide legal services at reduced rates, or even pro bono, where appropriate. In order for there to be an incentive to do so, and protection for those lawyers who do so, the court should be able to award costs for those litigants at the usual hourly rate for the lawyer who did that work.

The mother is entitled to claim costs based on the usual hourly rate her lawyer would charge. In cases where the party claiming costs was assisted by a lawyer being paid by the Ontario Legal Aid Plan, the court is not restricted to ordering costs at the lower, reduced rate. To hold otherwise would grant an inadvertent windfall to the party fortunate enough to only have to pay costs to an opposing party based on the reduced fees charged by that party's lawyer: Ramcharitar v. Ramcharitar, 62 O.R. (3d) 107 (Ont. Sup. Ct.).

A suitable hourly rate for these lawyers, under all these circumstances, and in the absence of other evidence, is $175.

Quantum of Costs

Determining the amount of costs is not simply a mechanical exercise. Costs must be proportional to the amount in issue and the outcome: Boucher et al. v. Public Accountants Council for the Province of Ontario, [2004] O.J. No. 2634 (Ont. C.A.).

Costs awards should reflect more what the court views as a fair and reasonable amount that should be paid by the unsuccessful parties, rather than any exact measure of the actual costs to the successful litigant. It is not appropriate to simply take the number of hours spent by counsel on a particular matter and multiply those hours by a determined hourly or per diem rate: Zesta Engineering Ltd. v. Cloutier, 21 C.C.E.L. (3D) 161 (Ont. C.A.).

The over-riding principle is reasonableness. 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: Boucher et al. v. Public Accountants Council for the Province of Ontario, 2004, Ont. C.A., supra.

The factors to consider in determining the amount of costs in family law matters are (Rule 24(11)):

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.

In determining the amount of costs in this matter, the court took into account these factors set out in Rule 24(11), as follows:

a) The importance, complexity or difficulty of the issues: The case was important to the mother, the father and the paternal grandmother. However, it was neither legally complex nor difficult. The case was very high conflict, mostly because of the behaviour of the paternal grandmother and her unwillingness to look at alternative outcomes to the one she sought. As well, the case lasted far too long for the complexity of the issues involved;

b) The reasonableness or unreasonableness of each party's behaviour in the case: A finding of unreasonableness is not necessary to the making of a costs order. The mother's and father's behaviour was reasonable. The behaviour of the paternal grandmother was unreasonable, rigid and dogmatic;

c) The lawyer's rates: The rates claimed for the mother's lawyers are very modest (legal aid rates) and are reasonable in the circumstances. The paternal grandmother made no submissions regarding the hourly rate;

d) The time properly spent on the case: The time spent by the mother's lawyers was reasonable, under these circumstances, given the issues at stake, the claims made by the paternal grandmother, the length of the court case, and the large amount of material filed. The case involved a motion for summary judgment, and then the case was set down for trial; and,

e) Expenses properly paid or payable: The disbursements claimed by the mother (total $1,510.41, including HST) were reasonable, particularly given the fact that the litigation lasted over a number of years, took place in two jurisdictions, and involved a summary judgment motion and a possible trial.

The court must determine an amount that is fair and reasonable for the unsuccessful party to pay in the particular circumstances of this case. This determination is not merely an arithmetical exercise of calculating time spent by a suitable hourly rate. The costs award in this case should take into account and reflect the amount of work necessary for the parents to respond to the paternal grandmother's claims.

Order

The paternal grandmother shall pay costs to both parents. A fair and reasonable costs order, and one that is proportionate to the issues involved, in all of these circumstances, is as follows:

a) To the mother $17,000 all in (fees plus HST, and disbursements plus HST); and,

b) To the father $6,000 all in (fees plus HST, and disbursements plus HST).

The final consent order of Paulseth, J. on 10 February 2016 provided that the paternal grandmother shall not bring a motion to change without leave obtained in advance. Such leave may be requested on a Form 14B motion, two pages maximum in support, not to be served on the other side, unless the court orders. The payment of costs shall be a factor for the court in determining any request for leave.

The final orders in this case (made 29 September 2015 and 10 February 2016) have not been issued and entered. The mother's lawyer shall have these orders taken out promptly, as well as this costs order.

Released: 6 June 2017 Justice Carole Curtis