Court File and Parties
Ontario Court of Justice
Between:
A.B. Applicant
— And —
J.B. Respondent
Before: Justice Melanie Sager
Written submission on costs
Decision on Costs released on March 13, 2018
Counsel:
- Joan M. Irwin — counsel for the applicant
- Cheryll Harris — agent for the respondent
Overview
1This is a decision on the issue of costs of the Applicant's (mother) motion for summary judgment which was heard on September 22, 2017. On November 27, 2017, I released my decision granting the relief requested by the mother dismissing the Respondent's (father) Motion to Change on the basis that the father raised no genuine issue in his Motion to Change that required a trial.
2The father's Motion to Change the order of Justice Geraldine Waldman dated July 25, 2013, was issued on December 1, 2015. It was amended on several occasions, the final version of which was never filed in the Continuing Record.
3The father's Motion to Change asked for orders as follows:
(a) An order varying Justice Waldman's order granting the mother custody of the parties' two children to provide that the parties shall share joint custody of the children;
(b) An order varying the terms of access as set out in Justice Waldman's order to allow for increased access by the father;
(c) Changes to the pick-up and drop off locations for access; and
(d) A retroactive reduction in the father's child support obligation resulting in a credit to the father in the amount of $14,912.00.
4The summary judgment motion brought by the mother only addressed the issues raised by the father in relation to custody of and access to the children.
5On November 27, 2017, I released my decision granting the motion for summary judgment and the father's claims in relation to custody and access were dismissed. The mother was invited to make costs submissions.
The Parties' Position on Costs
6The mother asks for costs in the amount of $26,000.00 for the summary judgement motion on the basis that she was entirely successful on the motion and presumptively entitled to her costs. The mother also seeks costs of $1,000.00 for responding to a 14B Motion brought by the father after completion of the summary judgment motion and $7,500.00 in costs for appearances in court on three days on which costs were reserved to the hearing of the summary judgment motion.
7The father, who advises that he is appealing the decision on the motion for summary judgment, asks that the issue of costs be reserved pending the outcome of the appeal. The father does not propose any amount of costs in the event that I do not accept his submission to reserve costs until the appeal is adjudicated but he does question the number of hours counsel for the mother spent on the motion and suggests more appropriate estimates of time. He does ask that any order take into account his "limited financial resources".
Background and the Litigation History
8The parties were in a relationship from 2005 until June 2011. They are the parents of two children, C.B. [born …] and B.B. [born …].
9In 2013 the parties were involved in a six day trial before Justice Waldman which resulted in the order of July 25, 2013, which the father was seeking to change. Justice Waldman's order provides, in part, that the mother shall have custody of the children and the father shall have regular access to the children alternate weekends from Friday at 6 p.m. to Sunday at 6:00 p.m. and every Tuesday from 4:00 p.m. to 7:30 p.m. The father was ordered to pay the mother child support for the two children in the amount of $1,232.00 per month based on an annual imputed income to the father of $85,000.00 and the Child Support Guidelines.
10On May 9, 2014, the father brought a Motion to Change the access and child support provisions of Justice Waldman's order. In his Motion to Change the father requested an expansion of his access to include pick up at school at 3:00 p.m., as opposed to pick up at 4:00 p.m. at the mother's home during the week, and 6:00 p.m. on alternate Fridays; and, a mid-week overnight visit; requests that were specifically denied by Justice Waldman at the trial.
11The parties attended in court before Justice Waldman on July 10, 2014 and in her Honour's endorsement she wrote, "I am not prepared to address any issues relating to the decision at trial under any circumstances. That can only occur via an appeal." Justice Waldman ordered the father to pay the mother's costs fixed at $400.00 and endorsed the record, "I am not prepared to change access today. Based on Respondent's manner and demeanor in ct. [court], nothing has changed."
12On December 1, 2015, the father brought the current Motion to Change Justice Waldman's order. He amended his Motion to Change (Fresh Motion to Change) on April 16, 2016 and of the relief he requested, the following are the more significant changes being requested to the order:
(a) An order for joint custody of the children;
(b) An order that the children be in his care every week from Tuesday at 3:00 p.m. until Wednesday at 9:00 a.m. and alternate weekends from Friday at 3:00 p.m. until Monday at 9:00 a.m. with pick up and drop off at school;
(c) An order fixing his child support obligation at $386.00 per month, based on an annual income of $26,014.00 and the Child Support Guidelines, as of January 1, 2016;
(d) An order fixing the father's share of section 7 expenses incurred for the children at 25%; and
(e) An order crediting to the father an overpayment of child support to the mother in the amount of $14,912.00 as of April 30, 2017
13The mother's position on the father's Motion to Change is that there has been no material change in circumstances warranting any of the changes the father is seeking to the custody and access provisions of the order and that his Motion to Change is just an attempt to re-litigate the issues addressed by Justice Waldman.
14The father's Motion to Change in relation to custody and access was stayed on May 20, 2016 until January 10, 2017 when he satisfied all outstanding costs orders against him.
15On April 25, 2017, a summary judgement motion was scheduled for July 20, 2017. On the return of the motion, the father requested an adjournment, which was opposed by the mother, as he had recently released his lawyer and wished to retain new counsel. The father's request for an adjournment was granted and made returnable on September 22, 2017, peremptory to the father who was ordered to pay the mother's costs fixed at $2,500.00 payable forthwith.
16The summary judgment motion was argued on September 22, 2017 and a decision was released on November 27, 2017, granting the motion for summary judgment and dismissing the father's Motion to Change in relation to issues of custody and access.
Legal Framework
17Costs orders are governed by Rule 24 of the Family Law Rules. Under Rule 24(1) there is a presumption that the successful party is entitled to costs. Subrule 24(11) sets out the factors the court must consider when fixing the amount of a costs order.
18The 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.
19Modern costs rules are designed to foster three fundamental purposes: Fong v. Chan, 46 O.R. (3d) 330, 181 D.L.R. (4th) 614, 1999 CanLII 2052, 1999 CarswellOnt 3955 (Ont. C.A.), 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.
20Rule 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.
21Justice Pazaratz in Chomos v. Hamilton, 2016 ONSC 6232, set out the governing principles for costs:
Rules 18 and 24 of the Family Law Rules govern the determination of both liability for costs and the amount of costs. While these rules have not completely eliminated judicial discretion, the rules nonetheless circumscribe the broad discretion previously granted to the courts in determining costs. C.A.M. v. D.M., 2003 CanLII 18880 (Ont. C.A.); Andrews v. Andrews, 1980 CanLII 3619 (Ont. C.A.); Wilson v. Kovalev, 2016 ONSC 163 (CanLII) (SCJ);
Rules 18 and 24, and most of the case law focus on two words: "Success" and "Reasonableness". The latter entails two components:
a. Reasonableness of behaviour by each party;
b. Reasonableness of the amount of costs to be awarded;
- In Serra v. Serra, 2009 ONCA 395 (CanLII) the Ontario Court of Appeal confirmed that costs rules are designed to foster three important principles:
a. To partially indemnify successful litigants for the cost of litigation.
b. To encourage settlement; and
c. To discourage and sanction inappropriate behaviour by litigants;
The assessment of costs is not a mechanical exercise. It's not just a question of adding up lawyer's dockets: Boucher et al. v. Public Accountants Council for the Province of Ontario, 2004 CanLII 14579 (ON CA); Dingwall v. Wolfe, 2010 ONSC 1044 (CanLII); and
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: Selznick v. Selznick, 2013 ONCA 35 (CanLII); Delellis v. Delellis, 2005 CanLII 36447 (ON SC); Serra (supra); Murray v. Murray, 2005 CanLII 46626 (ON CA); Guertin v. Guertin, 2015 ONSC 5498 (CanLII).
22The 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.
23The 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.
24Modern 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.
25When awarded on a full recovery scale, costs can serve to express the court's disapproval of unreasonable conduct during the litigation.
Success
26Success must be measured not only against the parties' Offers to Settle, but also against the claims made by each.
27An award of costs, however, is subject to the factors listed in rule 24(11), the directions set out under rule 24(4) (unreasonable conduct), rule 24(8) (bad faith) and rule 18(14) (offers to settle), and the reasonableness of the costs sought by the successful party.
28The mother was the successful party on this motion, and she is entitled to costs.
Factors for the Court to Consider When Fixing the Amount of Costs Pursuant to Rule 24(11)
Importance, Complexity or Difficulty of the Issues
29A summary judgment motion is rarely an uncomplicated matter in family litigation. There are several facets to an argument on a summary judgment motion and the parties must be prepared for each one. The moving party has the onus of providing the court with trial worthy evidence to support their position. It is a difficult task to demonstrate that there is no genuine issue requiring a trial. It is a high bar for the moving party to meet and results in final orders.
30There is no question that the issue before the court was of extreme importance to the parties.
The Reasonableness or Unreasonableness of Each Party's Behaviour in the Case
31Rule 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
24(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.
32One of the purposes of costs is to effect change in the litigants' behaviour. Family law litigants are responsible for and accountable for the positions they take in the litigation.
33Parties 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.
34Matrimonial litigation is an occasion for sober consideration and thoughtfulness rather than intemperate behaviour.
35The father's behaviour in the litigation was unreasonable. Here are some examples:
(a) The father's Motion to Change was an attempt to re-litigate the issues before Madam Justice Waldman during the 2013 trial. The father raised the same concerns and complaints in his Motion to Change that were raised at the trial in 2013;
(b) The father has brought two motions to change since Justice Waldman's final order, neither of which contained any genuine issue or material change in circumstances since the date of the order;
(c) The father's Motion to Change in relation to child support was stayed for almost 7 months between May 2016 and January 2017 as a result of his failure to pay Justice Waldman's costs order against him in the amount of $28,000.00 dated April 4, 2014;
(d) The father has not paid the mother this court's costs order of September 22, 2017 in the amount of $2,500.00;
(e) Many of the facts relied on by the father as the basis for the material change in circumstances existed at the date of the previous order;
(f) The father raised over 15 alleged material change in circumstances in his motion materials many of which were not contained in his pleadings, as the basis for seeking to change the final order;
(g) The father relied on several trivial or insignificant changes in his Motion to Change as opposed to material changes;
(h) The father provided no evidence that any of the changes he alleged have had an impact on the children such that the order no longer meets the needs of the children requiring a change;
(i) The father engaged in unreasonable and provocative behaviour and then attempted to rely on the mother's responses as a material change in circumstances;
(j) In some instances, the father's behaviour was so unreasonable that he made it virtually impossible for the mother to comply with Justice Waldman's order; for example, arranging make up and holiday access;
(k) The father was found to lack credibility due to false statements in his affidavit evidence. The father misquoted Justice Waldman in a fundamental way and mislead the court on the outcome of his criminal matter involving allegations of domestic violence against the mother;
(l) The court found that the father's blatant disregard for and manipulation of the truth in his affidavit evidence irreparably damaged his credibility;
(m) The evidence established that the father was not complying with Justice Waldman's order;
(n) The father made the inappropriate argument that he should have shared parenting of the children in order to obtain more government benefits including the child tax credit which he claimed is "unethical" for the mother to receive considering her wealth;
(o) The father's evidence was focused entirely on himself and not the children and how they would benefit from the variation he was seeking;
(p) The father's evidence on the motion was found to be full of unsupported and outlandish statements; and
(q) The father discharged his lawyer on the eve of the summary judgment motion causing the motion to be delayed several months.
Offers to Settle
36Offers 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. Whether a party has or has not made an Offer to Settle or responded to an Offer to Settle is relevant to the issue of whether they behaved reasonably or unreasonably (Rule 24(5)(b)).
37Parties 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.
38Offers 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. 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. The position each party took in the case should also be examined.
39The costs consequences of offers to settle are set out in Rule 18(14) as follows:
COSTS CONSEQUENCES OF FAILURE TO ACCEPT OFFER
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:
If the offer relates to a motion, it is made at least one day before the motion date.
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.
The offer does not expire and is not withdrawn before the hearing starts.
The offer is not accepted.
The party who made the offer obtains an order that is as favourable as or more favourable than the offer.
40The mother made three Offers to Settle; one on June 16, 2017, the second on June 29, 2017, and, the third on September 19, 2017. The first offered to settle the matter with no costs payable provide the father agreed to the dismissal of his Motion to Change by June 23, 2017. After that date, and until 1 minute after the commencement of the motion, if the father accepted the Offer to Settle he would be obliged to pay the mother's costs on a full recovery basis incurred from June 23, 2017 to the date of acceptance of the offer.
41The mother's second offer to settle offered minor changes to two provisions of Justice Waldman's order having to do with pick up and drop off of the children for the father's access. This offer provided that no costs would be payable provided the father accepted the terms by July 3, 2017; otherwise, if accepted after that date, the father would be obliged to pay the mother's costs on a full recovery basis from December 15, 2015 to the date of acceptance of the Offer to Settle.
42The mother's final offer to settle offered to alter the terms of Justice Waldman's order to allow the father to pick the children up from the mother's home, except for his Tuesday visits which the mother offered to commence at the end of the school day with pick up at the school. If the father accepted this offer on September 20, 2017, there would be no orders as to costs.
43The mother's offers to settle meet the requirements of Rule 18(4) of the Family Law Rules in that it was signed personally by the mother and her lawyer.
44The mother was wholly successful on the motion and she matched the substantive content of her Offer to Settle.
45While the father did not make an Offer to Settle in accordance with Rule 18(4), he did make a proposal to settle as set out in a letter from his lawyer to counsel for the mother dated September 20, 2017, two days before the motion was argued. His proposal to resolve the Motion to Change was to make 24 changes to Justice Waldman's order.
46Overall the manner in which the mother conducted herself was reasonable while the father's behaviour throughout has been unreasonable.
The Lawyer's Rates and the Time Properly Spent on the Case
47Counsel for the mother has been practicing law for 27 years. Her hourly rate of $350.00 per hour is very reasonable and was not challenged by the father.
48There is no doubt that on a motion for summary judgment the majority of the work is done at the front end, meaning before the motion is actually argued. The motion was scheduled for an afternoon and was completed in three hours. As the parties' oral submissions were formulated on the basis of completing the motion within three hours, both counsel made submissions that included referencing various paragraphs in their clients' affidavits or portions of case law they requested I reviewed upon completion of the motion and during my deliberations.
49Counsel for the mother provided a detailed bill of costs setting out the time spent on the motion for summary judgment. The amount of work done by both parties was substantial as the father raised many alleged material changes in circumstances which he claimed warranted a change to Justice Waldman's order. The mother had to address all of the allegations and provide evidence where possible to support her position. This no doubt was an extremely time consuming exercise. The mother prepared appropriate and succinct affidavit material.
50The father's affidavit was extremely long and dense. It was 43 pages and 152 paragraphs with 34 exhibits. It would require hours to review and respond. It is clear that the father's goal was to include every single event that has occurred between him and the mother and, in his mind, increasing the odds that the court will find that at least one of his alleged material changes creates a genuine issue requiring a trial. His approach was not reasonable and his calculated risk comes at a cost.
51Both parties prepared a factum and brief of authorities.
52While the time spent by the mother was extensive, I find that it was reasonable in all of the circumstances.
53The preferable approach in family law cases is to have costs recovery generally approach full recovery, so long as the successful party has behaved reasonably and the costs claimed are proportional to the issues and the result.
54In the context of family law disputes, a court need not find special circumstances to make a costs award approaching substantial recovery.
55Determining the amount of costs is not simply a mechanical exercise. Costs must be proportional to the amount in issue and the outcome.
56Costs 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.
57The 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.
58A fair and reasonable order and one that takes the behaviour of the parties as well as the complexity of the issues and the amount of work involved into consideration is $26,000.00, inclusive of disbursements and H.S.T.
59The mother is also entitled to her costs of the father's 14B motion after the hearing of the summary judgment motion in which he requested an additional hour to make further submissions. The mother filed responding submissions and the father's motion was dismissed. The father shall pay the mother's costs of that motion fixed at $1,000.00.
Costs of Previous Appearances That Were Reserved to the Summary Judgment Motion
60The court reserved the issue of costs for three appearances, specifically on January 10, 2017, February 24, 2017 and April 25, 2017. The mother seeks costs in the amount of $7,500.00 for time wasted.
61On January 10, 2017, the parties appeared in court in the morning before assignment court where the father's motion to change child support only was to be assigned trial dates. The father requested an appearance before the case management judge in the morning to request that the matter be removed from the assignment court list as he had paid the outstanding cost order and was requesting the stay in relation to his Motion to Change custody and access be lifted. The mother did not oppose the father's requests but sought her costs thrown away. Those costs including preparing a Trial Management Conference Brief for assignment court and attendance in the morning before the case management judge. The mother seeks costs in relation to this appearance fixed at $2,275.00.
62The mother submits that she prepared a Case Conference Brief for the February 24, 2017 that was adjourned last minute at the father's request. The mother seeks costs wasted on this appearance which did not proceed fixed at $2,450.00.
63The next court date of April 25, 2017 was set for a Case Conference. The mother submits that she did not receive any additional financial disclosure from the father between February 24, 2017 and April 25, 2017. Just prior to attendance on the conference, the mother received volumes of material by fax as well as an Amended Motion to Change. As a result, the Case Conference did not proceed and a Summary Judgment Motion was scheduled. The mother seeks her costs for preparing for the Case Conference fixed at $1,960.00.
64In addition to costs for fees fixed at $6,685.00, the mother seeks $250.00 in costs for disbursements.
65The father argues that any costs order for these appearances should have been made promptly following the event. He also argues that those appearances dealt with the financial issues which have not yet been adjudicated by the court.
66The father argues that as he was successful in having the case removed from the assignment court list on January 10, 2017, "it would be unjust and unfair to order costs against the respondent".
67The father's position is that there should be no costs for the February 24, 2017 court date as the appearance was adjourned on consent.
68The father argues that the case conference scheduled for April 25, 2017 was to address financial issues and as it did not go ahead, no costs should be ordered.
69There is no question that the mother is entitled to her costs thrown away preparing for assignment court on January 10, 2017 and attending in court that day to address the father's request to have the stay lifted and the matter removed from the assignment court list. The case was removed from the assignment court list as it made little sense to have one hearing to address the financial issues and possible a second to address the custody and access issues now that the stay had been lifted. The costs incurred by the mother for time wasted in relation to the January 10, 2017 court date are solely due to the father's conduct and she is entitled to full recovery of those costs.
70The mother consented to the father's request to adjourn the February 24, 2017 court date. The 14C Confirmation in which the court was advised that the parties were requesting an adjournment on consent did not provide for the issue of costs to be reserved to the next court date. It is unfair to request costs after providing that consent. The mother raised the issue of costs of February 24, 2017 on April 25, 2017, after giving her consent to the adjournment. It ought to have been raised at the time of the father's request to adjourn the court date. There shall be no costs ordered for the February 24, 2017 court date.
71As the mother was bombarded with financial disclosure and an Amended Motion to Change on the eve of the April 25, 2017 appearance, the work she did in advance of receiving that information was wasteful. The time spent on April 25, 2017 was to schedule and plan for the summary judgment motion. The time spent preparing the mother's Case Conference Brief was time wasted. Counsel for the mother attributes 3.35 hours preparing for the April 25, 2017 court date. She is entitled to costs for 3.35 hours or $1,172.50.
Order
72The father shall pay the mother her costs of the Summary Judgment Motion fixed in the amount of $26,000.00 payable forthwith.
73The father shall pay the mother her costs of responding to the father's 14B Motion dated September 28, 2017, fixed in the amount of $1,000.00 payable forthwith.
74The father shall pay the mother her costs for time wasted in relation to the January 10, 2017 and April 25, 2017 court appearances fixed at $3,447.50 payable forthwith. As these costs are in relation to the issue of child support, they shall be enforced as child support by the Family Responsibility Office if not paid.
Released: March 13, 2018
Signed: Justice Melanie Sager