Court File and Parties

Court File No.: D57724/12 Date: 2015-02-24

Ontario Court of Justice

Between:

F.D.M. Applicant

- and -

K.O.W. Respondent

Counsel:

• Glenda Perry, for the Applicant
• Corrinne Long, for the Respondent

Heard: In Chambers

Justice: S.B. Sherr

Costs Endorsement

[1] On February 2, 2015, the court released its endorsement granting the applicant's (the mother) motion to dismiss the respondent's (the father) motion to change the July 23, 2013 order of Justice Geraldine Waldman (the final order). The final order provides that the applicant (the mother) has sole custody of the parties' three children, ages 9, 7 and 6 (the children). It also provides that the father shall have no access to the children and restrains him from contacting or communicating directly or indirectly with the mother and the children.

[2] The father had asked the court in his motion to change to grant him access to the children and to terminate the restraining order.

[3] The mother was given permission to make written costs submissions and the father was given a timeline to respond.

[4] The mother seeks her full recovery costs of $14,046.58 from the father. The father asks that no order for costs be made.

Legal Framework for Costs

[5] The Ontario Court of Appeal in Serra v. Serra, 2009 ONCA 395, [2009] O.J. 1905 (Ont. C.A.) stated that modern costs rules are designed to foster three fundamental purposes, namely: to partially indemnify successful litigants for the cost of litigation, to encourage settlement and to discourage and sanction inappropriate behaviour by litigants bearing in mind that the awards should reflect what the court views is a fair and reasonable amount that should be paid by the unsuccessful party.

[6] Sub-rule 2(2) of the Family Law Rules (all rules references in this decision relate to these 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. See: Sambasivam v. Pulendrarajah, 2012 ONCJ 711, [2012] O.J. No. 5404 (Ont. C.J.).

[7] Subrule 24(1) creates a presumption of costs in favour of the successful party. Consideration of success is the starting point in determining costs. See: Sims-Howarth v. Bilcliffe, [2000] O.J. No. 330 (SCJ- Family Court).

Success and Presumption of Costs

[8] The mother was the successful party. The father's motion to change was dismissed on the basis that he had not met the threshold test of establishing a material change in circumstances since the final order.

[9] The father did not rebut the presumption that the mother is entitled to costs.

Bad Faith Analysis

[10] The mother asked the court to make a finding that the father acted in bad faith. Subrule 24(8) states that 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.

[11] The father's behaviour in this case did not rise to the level of bad faith. There is a difference between bad faith and unreasonable behaviour. The essence of bad faith is when a person suggests their actions are aimed for one purpose when they are aimed for another purpose. It is done knowingly and intentionally. See: S.(C.) v. S. (M.), 38 R.F.L. (6th) 315 (Ont. SCJ).

[12] The reasons for decision set out that it was reasonable for the father to seek access to the children. His motion to change was found to be premature – there is still considerable work for him to do – particularly with respect to his mental health and stability.

[13] The father unreasonably created additional costs for the mother by seeking last-minute adjournments of this hearing. However, the court addressed the prejudice to the mother by awarding her costs of $2,500 on August 19, 2014 (payable within 90 days) and $1,800 on November 14, 2014 (method of payment to be determined in this decision).

[14] The mother's behaviour was reasonable in this case.

Factors in Determining Costs

[15] In making this decision, the court considered the factors set out in sub-rule 24(11), which reads as follows:

24(11) 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.

Application of Costs Factors

[16] The case was important for the parties. The issues were made more difficult due to the father's slow production of his police and medical records.

[17] The rates claimed by counsel for the mother ($375 per hour) are very reasonable for a lawyer who was called to the Bar in 1992.

[18] The court carefully reviewed the mother's bill of costs. Some of the time claimed was for work done during prior steps in the case. For instance, the mother claimed $2,500 for a case conference held before Justice Waldman on April 25, 2014. No costs were awarded for this appearance. Subrule 24(10) sets out that costs are to be determined in a summary manner after each step in the case by the presiding judge. A "step" in the case is one of the discrete stages recognized by the rules such as a case conference, settlement conference and the like. See: Husein v. Chatoor, 2005 ONCJ 487, [2005] O.J. No. 5715 (OCJ). The court should not deal with requests for costs that were addressed or should have been addressed at these prior steps in the case. See: Islam v. Rahman, 2007 ONCA 622.

[19] The court also finds that part of the time claimed by the mother would have been indemnified by the prior costs orders.

[20] This motion only took a half-day to argue. However, a review of the record indicates that the reason the motion was completed in such a short period of time was due to the excellent preparation and organization of both lawyers, who were able to collate and highlight extensive police and medical records for the court. This hard work was necessary to properly present the facts to the court.

[21] The expenses claimed by the mother are reasonable.

[22] The court considered the father's ability to pay costs. See: MacDonald v. Magel, 67 O.R. (3d) 181 (Ont.C.A.). He claims that he is not working. However, a party's limited financial circumstances will not be used as a shield against any liability for costs but will be taken into account regarding the quantum of costs. See: Snih v. Snih, paras. 7-13. This order will permit the father to pay the costs in instalments.

[23] The court has also considered both Boucher et al. v. Public Accountants Council for the Province of Ontario, [2004] O.J.No. 2634 (Ont. C.A.) and Delellis v. Delellis and Delellis, [2005] O.J. No. 4345. Both these cases point out that when assessing costs it is "not simply a mechanical exercise." In Delellis, Aston J. wrote at paragraph 9:

However, 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.

Costs Order

[24] Taking into account all of these considerations, an order shall go that the father shall pay the mother's costs fixed in the amount of $7,200, inclusive of fees, disbursements and H.S.T.

[25] The father may repay this costs order and the costs order dated November 14, 2014 (a total of $9,000) at the rate of $150 per month, starting on April 1, 2015. However, if he is more than 30 days late in making any instalment payment, the entire amount of the arrears shall immediately become due and payable. The court is not including the costs order of August 19, 2014 in this payment scheme, as that order was made by another judge and had a specific time set for payment.

[26] The father is to immediately notify the mother if he obtains employment and provide her with the name, address and phone number of his employer, together with his first two pay stubs. In the event that the father obtains employment, the mother may move to accelerate repayment of costs.

[27] The mother sought an order that costs be paid to her counsel in trust. The court prefers not to become involved in private retainer arrangements and make such orders. The mother can execute an irrevocable direction and deliver it to the father.

Justice S.B. Sherr

Released: February 24, 2015