DATE : February 23, 2021 COURT FILE NO. D28771/05

Ontario Court of Justice

B E T W E E N:

CARLA FERLISI ACTING IN PERSON APPLICANT

• and -

DONOVAN BOUCHER ACTING IN PERSON RESPONDENT

HEARD: In Chambers

JUSTICE S.B. SHERR

Costs Endorsement

Part One – Introduction

[1] On January 27, 2021, the court released its reasons for decision regarding the parties’ motions to change the child support order of Justice Carole Curtis, dated June 4, 2009. See: Ferlisi v. Boucher, 2021 ONCJ 48.

[2] The court wrote the following at paragraph 114 of its decision:

[114] The court finds that the mother is entitled to costs. She is the successful party and the father has acted unreasonably. He failed to advise her of his increases in income, failed to pay appropriate child support and did not comply with multiple court orders. If the mother seeks costs she shall serve and file written costs submissions by February 8, 2021. The father will then have until February 19, 2021 to make written response. Costs submissions are restricted to two pages, not including any offer to settle or bill of costs. Costs submissions are to be delivered to or emailed to the trial coordinator’s office.

[3] The applicant (the mother) has filed costs submissions. She seeks costs in the range of $15,000 to $18,000. The respondent (the father) also filed costs submissions. His position is that costs for the mother should be fixed at $200.

Part Two – Legal Considerations

2.1 General Principles

[4] The Ontario Court of Appeal in Mattina v. Mattina, 2018 ONCA 867 set out that modern costs rules are designed to foster four fundamental purposes:

(1) to partially indemnify successful litigants;

(2) to encourage settlement;

(3) to discourage and sanction inappropriate behaviour by litigants and;

(4) to ensure that cases are dealt with justly under subrule 2 (2) of the Family Law Rules (all references to the rules in this decision are to the Family Law Rules).

[5] Costs can 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. See: British Columbia (Minister of Forests) v. Okanagan Indian Band, 2003 SCC 71, paragraph 25.

[6] Costs awards are discretionary. Two important principles in exercising discretion are reasonableness and proportionality. See: Beaver v. Hill, 2018 ONCA 840.

[7] An award of costs is subject to the factors listed in subrule 24 (12), subrule 24 (4) pertaining to unreasonable conduct of a successful party, subrule 24 (8) pertaining to bad faith, subrule 18 (14) pertaining to offers to settle, and the reasonableness of the costs sought by the successful party. See: Berta v. Berta, 2015 ONCA 918, at paragraph 94.

[8] 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).

2.2 Costs and Self-Represented Litigants

[9] Justice George Czutrin reviewed considerations for determining costs for self-represented litigants in Jordan v. Stewart, 2013 ONSC 5037 as follows:

a) A self-represented litigant does not have an automatic right to recover costs. The matter remains fully within the discretion of the trial judge. Moreover, 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. 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 to conduct the litigation, and that as a result, they incurred an opportunity cost by foregoing remunerative activity;

b) Parties who litigate against a self-represented person should not be able to ignore the potential for costs. The court retains the discretion to fashion an award of costs that is fair and reasonable in the circumstances of the case before it;

c) Where one party is represented by a lawyer and the other is not, the hourly rate that the represented litigant's lawyer is entitled to claim on an assessment of costs should inform the reasonable expectations of both parties as to the costs that they will likely be required to pay if unsuccessful. Otherwise, litigants represented by lawyers would be less circumspect with regard to their conduct and their response to the opposing party's efforts to settle because that party is a self-represented litigant.

d) It is near impossible to come up with an objective way of fixing an in-person party's hourly rate or the amount of time they spent, not at the court, doing what we might otherwise consider lawyer's work.

e) Ultimately, the overriding principle in fixing costs is "reasonableness".

f) Courts addressing costs should consider Bills of Costs certified by lawyers who have provided assistance, even if not on the record throughout the case.

[10] Justice Laura Fryer added the following considerations in Browne v. Cerasa, 2018 ONSC 2242:

a) Determination of costs for self-represented litigants should take into account all of the objectives which costs orders should promote. Rules 18 and 24 apply. Otherwise the resulting amount can render the entitlement to costs illusory; undermine access to justice by self-represented litigants; and frustrate the administration of justice.

b) If a self-represented litigant, in performing the tasks that would normally have been performed by a lawyer, lost the opportunity to earn income elsewhere, this may be a relevant factor. But costs for self-represented parties are not the same as damages for lost income. Remunerative loss is not a “condition precedent” to an award for costs.

c) To require proof of lost income would disqualify litigants who are homemakers, retirees, students, unemployed, unemployable and disabled; and deprive courts of a tool required re administration of justice.

d) Lost income may be one measure. But even if no income was lost, the self-represented party’s allocation of time spent working on the case may still represent value. The fact that a self-represented litigant is not a lawyer who charges a standard and commonly accepted hourly rate makes it more difficult – but not impossible – to assess their costs. However, the difficulty in valuing the time and effort of the lay litigant is not a good reason to decline to value it.

e) An applicable hourly rate should be taken into account when quantifying even a self-represented lay litigant’s costs. But the appropriate hourly rate, once determined, is only one of several factors to be considered.

f) In considering the hourly rate, the court should consider what the lay litigant’s reasonable expectations were as to the costs he or she would pay if unsuccessful.

g) As with counsel, the appropriate hourly rate may be affected by the level of indemnification or recovery deemed to be appropriate, given all of the rule 18 and 24 considerations.

[11] Several courts have fixed hourly rates for self-represented litigants in assessing costs. In Jahn-Cartwright 2010 ONSC 2263, 2010 91 R.F.L. (6th) 301 (SCJ) an hourly rate of $200.00 was applied, which was approximately two-thirds of what the husband’s lawyer would have been entitled to claim. In Cassidy v. Cassidy, 2011 ONSC 791, 2011 92 R.F.L. (6th) 120 (Ont. S.C.J.), an hourly rate of $150 was applied. In Agmon v. James, 2018 ONCJ 240 and in Anyumbe v. Kebe, 2018 ONCJ 865, this court used an hourly rate of $125 in assessing costs for a successful self-represented litigant. In Izyuk v. Bilousov, 2011 ONSC 7476, the court fixed the self-represented party’s hourly rate at $100 per hour. This approach was followed in Browne v. Cerasa, 2018 ONSC 2242.

2.3 Costs for Prior Steps in a Case

[12] Prior to July 1, 2018, pursuant to subrule 24 (10), costs for any step in the proceeding were required to be determined at the time or expressly reserved. In Islam v. Rahman, 2007 ONCA 622, the Ontario Court of Appeal set out that the trial judge should not deal with requests for costs that were addressed or should have been addressed at prior steps in the case. However, this did not preclude courts from awarding costs accrued from activity not specifically related to the step. Activity not requiring judicial intervention is often better dealt with at the end of the case and not by the motions judge. See: Houston v. Houston, 2012 ONSC 233; Walts v. Walts, 2014 ONSC 98.

[13] Subrule 24 (11) came into force on July 1, 2018 and now provides that the failure of the court to order costs in relation to a step in a case does not prevent it from awarding costs in relation to the step at a later stage in the case.

[14] However, courts continue to be cautious about awarding costs at the trial stage where costs were not awarded at earlier steps in a case. See: Baezner v. Brunnenmeir, 2018 ONCJ 956; Nabwangu v. Williams, 2019 ONCJ 171.

[15] In Laidman v. Pasalic and Laidman, 2020 ONSC 7068, the court set out that the presumption remains that costs should be determined at each stage and said that there are good reasons for this. Parties should have an ongoing awareness of the cost consequences of litigation decisions they make. Reserving costs may impede final resolution by needlessly inflating and complicating the list of future issues still to be dealt with. A judge who has just completed a step in a case will usually be in the best position to evaluate all of the relevant Rule 18 and 24 considerations. Reserving costs to a future event – often to a different judge – can result in later confusion and controversy about what really happened at the earlier step.

[16] In Berge v. Soerensen, 2020 ONCJ 265, Justice Roselyn Zisman set out the following circumstances where costs of a prior step should be awarded:

a) Costs have been reserved to the trial judge.

b) When, considering subsequent events, the trial judge is better situated to determine the costs of the prior step than the judge presiding over the step or;

c) In exceptional circumstances.

2.4 Other Factors Affecting the Amount of the Support Order

[17] Subrule 24 (12) reads as follows:

24 (12) In setting the amount of costs, the court shall consider,

a) the reasonableness and proportionality of each of the following factors as it relates to the importance and complexity of the issues:

(i) each party’s behaviour,

(ii) the time spent by each party,

(iii) any written offers to settle including offers that do not meet the requirements of rule 18,

iv) any legal fees, including the number of lawyers and their rates,

v) any expert witness fees, including the number of experts and their rates,

vi) any other expenses properly paid or payable; and

(b) any other relevant matter.

[18] Subrule 24 (4) sets out that a successful party who has behaved unreasonably may be deprived of all or part of their costs. The successful party may even be ordered to pay all or part of the unsuccessful party’s costs.

[19] Subrule 24 (5) provides criteria for determining the reasonableness of a party’s behaviour in a case (a factor in clause 24 (12) (a) (i) above). 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.

[20] The court should also take into consideration the ability of a party to pay costs. See: MacDonald v. Magel (2003), 67 O.R. (3d) 181 (Ont. C.A.). Ability to pay will be less of a mitigating factor when the impecunious party has acted unreasonably, or where their claim was illogical or without merit. See: Gobin v. Gobin, 2009 ONCJ 278; D.D. and F.D. v. H.G., 2020 ONSC 1919.

[21] Those who can least afford to litigate should be most motivated to seriously pursue settlement and avoid unnecessary proceedings. See: Mohr v. Sweeney, 2016 ONSC 3338; Balsmeier v Balsmeier, 2016 ONSC 3485.

[22] In determining the appropriate quantum, the court should consider the amount that the unsuccessful party could reasonably have expected to pay in the event of lack of success in the litigation. See: Arthur v. Arthur, 2019 ONSC 938.

Part Three – Analysis

[23] The court has already determined that the mother was the successful party on the motions to change. The court denied the father’s request to rescind arrears. The arrears were fixed at $11,217.08 and were ordered to be paid to the mother immediately. The Family Responsibility Office was holding funds that had been collected from the sale of the father’s home in an amount sufficient to satisfy these arrears. Additional income was imputed to the father for the purpose of the ongoing support calculation, although not as much as sought by the mother. The court also ordered a contribution by the father to the child’s special and extraordinary expenses, although, again, not as much as sought by the mother.

[24] The presumption that the mother is entitled to costs was not rebutted by the father. The only issue is the amount of costs that the father should pay to her.

[25] This case was important to the parties. It had some complexity and difficulty as the court had to deal with issues such as the impact of an agreement on the mother’s ability to enforce support arrears, imputation of income to the father and a determination of the father’s contribution to the child’s special and extraordinary expenses. The father’s failure to comply with financial disclosure orders made the matter more prolonged and difficult.

[26] Neither party made an offer to settle. This is unreasonable behaviour, particularly since Justice Curtis had previously endorsed: “both parties shall make offers to settle”.

[27] On October 19, 2020, Justice Curtis endorsed that the parties continue to have unrealistic expectations of what the court can offer them.

[28] The mother spent a lot of unnecessary time taking the position that Justice Curtis had made a final decision about the arrears issue on April 17, 2019. This was not the case, as the following took place.

a) Justice Curtis endorsed on April 17, 2019 that the parties had both resiled from an agreement to settle the case. The only order Justice Curtis made that day was for temporary child support.

b) The parties were informed by this court on September 17, 2020 (on the mother’s Form 14B motion) that the issues of arrears and ongoing support had not been determined on a final basis by Justice Curtis.

c) This was reiterated by the court to the mother at the trial management conference that started on September 30, 2020. The mother continued to insist that Justice Curtis had made a final order fixing the arrears. The court indicated that she would need to return to Justice Curtis for directions.

d) On October 19, 2020, Justice Curtis confirmed that the arrears and ongoing support issues had not been determined and were to be determined on the hearing of the motions to change.

[29] The mother acted unreasonably regarding this issue and wasted significant time.

[30] As set out in paragraph 114 of the reasons for decision, the father did not act reasonably on the motions to change.

[31] The mother asks that she be compensated at the rate of $250 per hour for her time spent on the case.

[32] The court will use the same hourly rate it applied in Agmon v. James, 2018 ONCJ 240 and in Anyumbe v. Kebe, 2018 ONCJ 865 for self-represented litigants – being $125 per hour.

[33] The mother claimed time of between 60 and 75 hours in her costs submissions.

[34] The mother did not specify her time spent on each step of the case. This leaves it to the court to determine what is a reasonable amount of time for her to claim.

[35] The mother filed several procedural motions in this case that were either improperly brought or were unsuccessful. For instance:

a) On September 27, 2018, Justice Carole Curtis dismissed her request for an urgent motion.

b) On July 16, 2020, the court dismissed her Form 14B motion to compel the Family Responsibility Office to pay funds it was holding to her.

c) On September 27, 2020, the mother brought a Form 14B motion for an earlier court date. It was not served on the father and the court would not proceed with it. The court endorsed that it was apparent that the mother should obtain some legal advice as she was not following the proper court process.

e) On October 2, 2020, Justice Curtis dismissed another Form 14B motion brought by the mother, endorsing that it was not the proper subject of a Form 14B motion and was properly the subject of the motions to change.

[36] The mother’s claim clearly encompassed time for previous steps in the case. Justice Curtis conducted case conferences on December 4, 2018 and on February 28, 2019. She did not reserve costs. She was much better positioned to determine if costs should be awarded for those appearances. There are no exceptional reasons to order costs for those steps at this stage.

[37] Likewise, Justice Curtis heard the aborted motions to change on April 17, 2019. Both parties resiled from their agreement on that day. Justice Curtis determined that the case should be heard by another judge. Costs were not ordered or reserved. It is not appropriate for the court to order costs for that step at this stage.

[38] Costs should also not be awarded to the mother for the trial management conference that could not continue due to her insistence that the arrears issue had been resolved.

[39] However, there are costs that the mother is entitled to, including her time for;

a) Preparing her motion to change and change information form.

b) Preparing her amended motion to change materials.

c) Preparing her financial statements.

d) Preparing her trial affidavits.

e) Serving and filing these documents.

f) Organizing her evidence for trial. This included organizing evidence that established the arrears, supported the imputation of income to the father and established special and extraordinary expenses.

g) Pursuing financial disclosure from the father who was obstructive in providing accurate financial information.

h) Preparing for the motions to change.

i) Preparing her costs submissions.

[40] The court finds that 24 hours is a reasonable amount of time for the mother to have spent for this work. At $125 per hour this comes to $3,000 on a full recovery basis.

[41] The mother did not make an offer to settle, acted unreasonably at times in the litigation, and was not completely successful on all her claims. This is not a case for full recovery costs. However, significant costs should still be ordered to reflect the father’s unreasonable behaviour and to partially indemnify the successful party.

[42] The court finds that the father will be able to afford the costs that are ordered. Further, due to his unreasonable conduct, he will be required to pay these costs in full before he is permitted to bring any further proceeding in this court, unless he obtains prior leave of the court.

Part Four – Conclusion

[43] An order shall go as follows:

a) The father shall pay the mother’s costs fixed at $2,000.

b) The entire amount of costs may be enforced by the Family Responsibility Office as an incident of support.

c) The costs are payable within 30 days.

d) The father must provide evidence that he has paid these costs in full before he can start any further proceeding in this court, unless he obtains prior leave of the court.

Released: February 23, 2021

Justice Stanley Sherr