COURT FILE NO.: 32304-10 DATE: 2018 07 06
SUPERIOR COURT OF JUSTICE – ONTARIO
RE: Diana Tsinokas, Applicant v. Jan Kucerak, Respondent
BEFORE: Bloom, J.
COUNSEL: Lisa Kadoory, for the Applicant Deborah Ditchfield, and S. De Groot, for the Respondent
COSTS ENDORSEMENT
I. Introduction and Procedural Background
[1] This matter comes before me for a determination of entitlement to costs after a consent order made by Justice Coats on April 11, 2017.
[2] The parties were married on June 29, 1986. They separated on September 12, 2008. The Applicant commenced the proceeding by Application on February 11, 2010.
[3] As noted, the parties settled by way of a consent order made by Justice Coats on April 11, 2017. That order conferred on me the duty to decide the issue of costs.
[4] The costs hearing began on April 13, 2017. On May 16, 2017 I adjourned that hearing sine die pending a challenge by the Applicant to the consent order.
[5] That challenge was brought before Justice Miller based on allegations of fraudulent misrepresentations by the Respondent as to his date of separation assets and income from the date of separation. Justice Miller dismissed that motion.
[6] The costs matter then resumed before me.
II. Governing Legal Principles
[7] The following legal issues arise in this matter: (1) jurisdiction to make a costs order where the proceeding has settled; (2) effect on costs to be awarded of bad faith and unreasonable conduct in the disclosure process; (3) effect on costs to be awarded of success in the proceeding and of offers by the parties; (4) effect on costs to be awarded of no order being made as to costs on an appearance; and (5) when costs thrown away are awarded and their quantum.
A. Jurisdiction to Make a Costs Order Where the Proceeding has Settled
[8] The parties’ facta both concede the existence of jurisdiction to make a costs order when the case settles. The Respondent simply emphasizes the difficulty in determining the extent of success on the part of the parties.
[9] In Talbot v. Talbot, 2016 ONSC 1351 at para. 7 Justice Templeton cites Justice O’Connell in Davis v. Fell, [2016] O.J. No. 749:
7 A comprehensive review of the law regarding the issue of costs in family law proceedings was recently undertaken by Justice O'Connell in Davis v. Fell 1 ,
An award of costs is governed by s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43 and Rule 24 of the Family Law Rules, O. Reg. 114/99.
Cost awards are exercises of judicial discretion[1]. The general source of judicial discretion to award costs is found under s. 131 of the Courts of Justice Act, However, that discretion must be exercised within the framework established by Rule 24 of the Family Law Rules.
Rule 24 of the Family Law Rules, O. Reg. 114/99, governs the determination of costs in family law proceedings. The sections relevant to the circumstances of this case are as follows:
24(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.
(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."
Rule 24 (11) provides a further list of factors that a court must consider when setting the amount of costs:
(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) .
Rule 18(14) and 18(16) of the Family Law Rules, which address the cost consequences of offers to settle, provide the following:
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.
(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. O. Reg. 114/99, r. 18 (14) and (16) .
Rule 24 created a new framework for determining costs in family law proceedings. The presumptive nature of Rule 24 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. (2003), 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. Courts must not only decide liability for costs, but also the amount of those costs.
In Serra v. Serra, 2009 ONCA 395, 66 R.F.L. (6th) 40, [2009] O.J. No. 1905, 2009 CarswellOnt 2475, 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.
The 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, 188 O.A.C. 201, 48 C.P.C. (5th) 56, [2004] O.J. No. 2634, 2004 CarswellOnt 2521 (Ont. C.A.), 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.
Consideration of success is the starting point in determining costs. However, any attempt to determine a "winner" or "loser" in a settlement is, in most cases, complex if not impossible. Cases are resolved in whole or in part for many reasons. See Sims-Howarth v. Bilcliffe, 2000 CarswellOnt 299 (S.C.J.), para. 1. Thus, for good reason, judges are reluctant to make an order as to costs when the parties settle the merits to their dispute. Where parties make a settlement as between themselves, the court should be very slow to make an award of costs against one of the parties. Unless there are compelling reasons to do so, costs in the circumstances of the settlement between parties ought not to be awarded by the court. See: Page v. Desabrais, supra, para. 28; Blank v. Micallef, 2009 CarswellOnt 6790, para. 11; Gurzi v. Elliot, 2011 CarswellOnt 2169 (O.C.J.) para. 16. ...
Further, if a successful party has behaved unreasonably "in relation to the issues from the time they arose (Rule 24(5)," then pursuant to Rule 24(4), they may be "deprived of all or part of the [their]costs or ordered to pay all or part of the unsuccessful party's costs." Behaviour under Rule 24(5) is not restricted to behaviour associated with offers to settle. See Family Law Rules, Rule 24(4), (5) and 11(b); Lawson v. Lawson, 2004 CarswellOnt 3154 (S.C.J.), para. 44.
B. The Effect of Bad Faith and Unreasonable Conduct in the Disclosure Process
[10] FLR 24(8) provides:
BAD FAITH
(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. O. Reg. 114/99, r. 24 (8) .
[11] FLR 24(11)(b) provided as follows until June 30, 2018:
FACTORS IN COSTS
(11) In setting the amount of costs, the court shall consider,
(b) the reasonableness or unreasonableness of each party’s behaviour in the case;
[12] On July 1, 2018 that provision was replaced by new FLR 24(12) which provides:
(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,
[13] The conduct of a party in the disclosure process thus can have costs consequences. If this conduct is in in bad faith, full recovery costs are awarded. If it is unreasonable, costs consequences are still appropriate, up to and including full recovery costs.
[14] In Benzeroual v. Issa and Farag, 2017 ONSC 6225 at para. 32 Justice Pazaratz states:
32 Not every breach of the disclosure obligation will necessarily be so egregious as to constitute "bad faith".
a. The adequacy of disclosure must be considered in the context of the circumstances of the case; the complexity of financial regime; and the nature and magnitude of potential claims.
b. In addition to the adequacy or volume of the disclosure produced, the court must also consider the intention or motivation behind the litigant's approach to disclosure. Inattentiveness to the obligation will, at a minimum, constitute unreasonable behaviour. Deliberate concealment, evasiveness or obfuscation will more likely constitute "bad faith."
c. Given the fundamental importance of income determinations with respect to the application of the Child Support Guidelines, persistent refusal by a party to make accurate financial disclosure and reveal their income will give rise to a level of bad faith. Ascento v. Davies, 2012 ONCJ 581 (OCJ).
d. Inadequate disclosure should always lead to costs sanctions. In some cases, the misconduct can be so serious as to constitute bad faith -- with heightened cost consequences.
[15] In Chan v. Chan, 2014 ONSC 666 at paras. 11 to 13 Justice McGee also discusses those principles:
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 court without adequate evidence to prove their claims, and should send the message that the successful party should have redress by awarding costs on a full recovery basis.
12 Rule 24(8) provides 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. However, 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, supra. A full recovery of costs can be ordered absent a finding of bad faith.
13 For example, a full recovery of costs can be ordered if a party has acted unreasonably. In deciding whether a party has acted reasonably or unreasonably in a case, the court may examine the reasonableness of any offer the party made (clause 24(5)(b)) and see Juliette Vanessa M. v. Floyd Dale P., 2011 ONCJ 616.
C. The Effect of Success and Offers on Costs
[16] FLR 24 and 18 contain the following provisions relevant to effect of success and offers to settle on the issue of costs:
SUCCESSFUL PARTY PRESUMED ENTITLED TO COSTS
- (1) There is a presumption that a successful party is entitled to the costs of a motion, enforcement, case or appeal. O. Reg. 114/99, r. 24 (1) .
SUCCESSFUL PARTY WHO HAS BEHAVED UNREASONABLY
(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. O. Reg. 114/99, r. 24 (4) .
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. O. Reg. 114/99, r. 24 (5) .
DIVIDED SUCCESS
(6) If success in a step in a case is divided, the court may apportion costs as appropriate. O. Reg. 114/99, r. 24 (6) .
DEFINITION
- (1) In this rule,
“offer” means an offer to settle one or more claims in a case, motion, appeal or enforcement, and includes a counter-offer. O. Reg. 114/99, r. 18 (1) .
APPLICATION
(2) This rule applies to an offer made at any time, even before the case is started. O. Reg. 114/99, r. 18 (2) .
MAKING AN OFFER
(3) A party may serve an offer on any other party. O. Reg. 114/99, r. 18 (3) .
OFFER TO BE SIGNED BY PARTY AND LAWYER
(4) An offer shall be signed personally by the party making it and also by the party’s lawyer, if any. O. Reg. 114/99, r. 18 (4) .
WITHDRAWING AN OFFER
(5) A party who made an offer may withdraw it by serving a notice of withdrawal, at any time before the offer is accepted. O. Reg. 114/99, r. 18 (5) .
TIME-LIMITED OFFER
(6) An offer that is not accepted within the time set out in the offer is considered to have been withdrawn. O. Reg. 114/99, r. 18 (6) .
OFFER EXPIRES WHEN COURT BEGINS TO GIVE DECISION
(7) An offer may not be accepted after the court begins to give a decision that disposes of a claim dealt with in the offer.
COSTS CONSEQUENCES OF FAILURE TO ACCEPT OFFER
(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. O. Reg. 114/99, r. 18 (14) .
COSTS CONSEQUENCES — BURDEN OF PROOF
(15) The burden of proving that the order is as favourable as or more favourable than the offer to settle is on the party who claims the benefit of subrule (14). O. Reg. 114/99, r. 18 (15) .
COSTS — DISCRETION OF COURT
(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. O. Reg. 114/99, r. 18 (16) .
[17] In Fard v. Fard, [2002] O.J. No. 2511 (Ont. Sup.Ct.) at para. 14 Justice Campbell discussed the relationship between divided success and bad faith in the determination of costs:
Also, in my view, bad faith "trumps" a somewhat divided "success" since, without bad faith, the parties would have avoided the huge cost, both emotional and financial, of the continued litigation. They both would have "succeeded" by saving tens of thousands of dollars that they could have used for their own and their children's benefit.
[18] In Scipione v. Scipione, 2015 ONSC 5982 at para. 68 Justice Pazaratz commented on the measuring of the success of the parties where success is divided:
68 "Divided success" does not necessarily mean "equal success". And "some success" may not be enough to impact on costs.
a. Rule 24(6) requires a contextual analysis.
b. Most family court cases involve multiple issues.
c. Not all issues are equally important, equally time-consuming or equally expensive to determine.
d. Comparative success can be assessed in relation to specific issues:
i. Did a mid-point number prevail on a financial issue?
ii. Did a compromise result on a parenting issue?
e. Comparative success can also be assessed globally in relation to the whole of the case:
i. How many issues were there?
ii. How did the issues compare in terms of importance, complexity and time expended?
iii. Was either party predominantly successful on more of the issues?
iv. Was either party more responsible for unnecessary legal costs being incurred?
[19] Justice Pazaratz in Jackson v. Mayerle, 2016 ONSC 1556 at para. 22 considered the approach to the application of FLR 18:
22 To determine whether a party has been successful, the court should take into account how the order or eventual result compares to any settlement offers that were made. Lawson v. Lawson.
D. The Effect of Failure to Address Costs on a Step in the Proceeding
[20] FLR 24(10) provided until June 30, 2018:
DECIDING COSTS
(10) Promptly after dealing with a step in the case, the court shall,
(a) make a decision on costs in relation to that step; or
(b) reserve the decision on costs for determination at a later stage in the case. O. Reg. 235/16, s. 4 (2).
[21] On July 1, 2018 the following provisions of the rules came into force:
DECIDING COSTS
(10) Promptly after dealing with a step in a case, the court shall, in a summary manner,
(a) determine who, if anyone, is entitled to costs in relation to that step and set the amount of any costs; or
(b) expressly reserve the decision on costs for determination at a later stage in the case. O. Reg. 298/18, s. 14.
SAME
(11) The failure of the court to act under subrule (10) in relation to a step in a case does not prevent the court from awarding costs in relation to the step at a later stage in the case. O. Reg. 298/18, s. 14.
[22] I will first consider the principles which governed the law as it stood before it was amended as of July 1, 2018.
[23] Despite argument of the Applicant that trial management conferences should not be considered a separate step from trial for purposes of FLR 24(10), in my view the Court of Appeal has ruled otherwise.
[24] In Islam v. Rahman, 2007 ONCA 622 at para. 2 the Court stated:
2 However, we accept the appellant's submission that the trial judge erred in failing to exclude from the award of costs amounts claimed for steps taken in the case where no order was made as to costs or where there was silence on the issue. Rule 24(10) of the Family Law Rules provides that the judge who deals with a step in a case shall decide who, if anyone, is entitled to costs. If a party who has served an offer to settle the case as a whole wishes that fact taken into consideration in relation to a particular step, it is incumbent on that party to raise that issue with the judge who deals with that step. In this case, various steps were taken (e.g. motions, conferences) [emphasis added] in relation to which either there was an endorsement that there be no order as to costs or the issue of costs was not addressed. In the absence of a specific order for costs in favour of the respondent, the trial judge should have disallowed costs claimed by the respondent in relation to such steps.
[25] In Bortnnikov v. Rakitova, 2016 ONCA 427 at para. 34 the Court reaffirmed that principle:
34 Islam v. Rahman, 2007 ONCA 622, 228 O.A.C. 371, at para. 2, confirms that a trial judge should not make an order for costs in relation to any earlier step where no costs were ordered or where there was silence on the issue.
[26] The parties differed on whether the change to the rules should apply to the case at bar.
[27] The Applicant submits that authority supports a retrospective application of the rule change on the basis that it is procedural. The Respondent contends that the change should not apply.
[28] In Trustee of C.B.C. Pension Plan v. BF Reality Holdings Ltd., [2002] O.J. 4313 (Ont. C.A.) at paras. 13 to 14 the Court addressed the question at issue:
13 The consequences of a retrospective application of the new costs grid can be serious and, in some cases, highly prejudicial to the affected parties. In those circumstances, justice between the parties may require a court, in the exercise of its discretion concerning costs, to deviate from the strict requirements of the costs regime envisaged by O. Reg. 284/01. In our view, however, those cases will be rare and will normally depend on evidence of actual prejudice beyond the fact that the legal services at issue were rendered prior to January 1, 2002.
14 In this case, no demonstration of such prejudice has been advanced or established. There is no basis, therefore, to depart from the traditional approach of retrospective application of enactments in the nature of O. Reg. 284/01. This court's award of costs was made after O. Reg. 284/01 came into force. Accordingly, the scale of costs applicable to the costs award made in favour of the respondents is governed by O. Reg. 284/01. Thus, costs are to be calculated on a partial indemnity, rather than a party and party, basis.
[29] In my view for me to apply the new provisions simply because I release my reasons after June 30, 2018, despite the fact that the events in question occurred long before that date and the fact that the argument concluded before that date, would be manifestly unfair to the Respondent. It would expose him to costs consequences not based on policy or logic, but on happenstance. I, therefore, exercise my discretion in the manner spoken of by the Court in C.B.C. Pension Plan, and apply the pre-July 1, 2018 principles.
E. Costs Thrown Away
[30] In Caldwell v. Caldwell, 2015 ONSC 7715 at paras. 8 to 13 Justice Quinlan set out principles applicable to “costs thrown away”:
8 The phrase "costs thrown away" refers to a party's costs for trial preparation which have been wasted and will have to be re-done as a result of the adjournment of the trial: Pittiglio v. Pittiglio, 2015 ONSC 3603 at para. 7; Middleton v. Jaggee Transport Ltd., 2014 ONSC 3041, at para. 5.
9 There are three general categories of cases in "costs thrown away" decisions:
(i) the first category deals with fault where, for example, one of the parties or their counsel neglect to call a witness or a last-minute amendment is required. The court will grant the adjournment on conditions, including the payment of costs thrown away;
(ii) the second category is where the trial is adjourned because of the court's scheduling problems. No costs are awarded in this circumstance as no party bears responsibility for the adjournment; and
(iii) the third category deals with adjournments sought by one of the parties as a result of no fault on their part. Costs thrown away are still awarded against the party applying for the adjournment, notwithstanding lack of fault: Goddard v. Day, 2000 ABQB 799.
10 The court noted in Goddard, at para. 20:
The third category... is really one of responsibility for the adjournment as opposed to fault or lack of fault... situations where someone is responsible for an adjournment, but cannot be faulted for that responsibility... [B]eing responsible for an adjournment...carries with it a costs consequence.
11 Costs thrown away are generally payable on a full recovery basis: Pittiglio, at para. 5; Milone v. Delorme, 2010 ONSC 4162, 2010 CarswellOnt 5535, at para. 12; Straume v. Battarbee Estate, 2001 CarswellOnt 6225, at paras. 2-3; Middleton, at para. 5. This is because the purpose of such an award of costs is to "indemnify a party for the wasted time for trial preparation arising from the adjournment": Pittiglio, at para. 6; Legacy Leather International Inc. v. Ward, at para. 9. Such an award is not to punish the party seeking the adjournment, but to indemnify the other party for the wasted time for trial preparation arising from the adjournment: Incandescent Revolution Manufacturing Co. v. Gerling Global General Insurance Co., at para. 12; Pittiglio, at para. 6, citing Kalkanis v. Kalkanis, 2014 ONSC 205, at para. 3.
12 The court must determine what costs have actually been wasted. This is not an easy task: some witnesses will require little further preparation while some will require much: Straume, at para. 4. It has been described as an "intuitive", rather than a scientific, process: Pittiglio, at para. 17.
13 An award of costs thrown away can be revisited at the end of the trial to determine if further costs should be awarded: Straume, at para. 37; Middleton, at para. 23; Laudon v. Roberts & Sullivan, at para. 20.
III. Application of the Governing Principles to the Facts of this Proceeding
[31] The Applicant seeks costs on a full recovery basis on the footing that the Respondent’s conduct in relation to disclosure was in bad faith, or in the alternative was unreasonable.
[32] The Respondent’s primary submission is that the parties ought to bear their own costs. Alternatively, he submits that if I examine the details of the litigation I will find that he was the more successful party, and is entitled to costs on a partial indemnity scale to the date of his last offer, and, thereafter, to costs on a substantial indemnity scale.
[33] Viva Voce and documentary evidence was adduced before me. That evidence included inter alia evidence from the parties, themselves, by affidavit and orally. I have considered the evidence adduced in reaching my conclusions.
[34] The Applicant called Jeffrey Feldman as witness. Mr. Feldman is a chartered business valuator. He prepares assessments of the income available for support and of the value of businesses. He was retained by the Applicant for purposes of the proceeding.
[35] Mr. Feldman testified that initially, based on information provided by the Respondent, he believed that the Respondent’s business interests had no value; and that, accordingly, his task would be simply valuation of the Respondent’s income. He testified further that subsequently he found that the information provided to him had not been accurate; requested and obtained further disclosure from the Respondent; and determined that the Respondent’s business interests had value.
[36] Mr. Feldman testified in a logical and calm manner. His credibility was not weakened in cross-examination. I accept his evidence.
[37] I note also that the Respondent spoke of his own attitude to disclosure in cross-examination before me in relation to affidavits he had signed; these affidavits addressed the financial status of companies in which he was alleged to have an interest:
Q. It was your counsel’s rush, not yours.
A. He called and told me we have to put together affidavits on all the companies. We discussed them. He says I got to get them to you today, you got to get them signed, you got to scan them, email them back to me and I’ve got to get it to the other side. That was the rush.
Q. Okay. Now you agree that at this point in time this matter had been in litigation for years at the time that these affidavits were…
A. Yes.
Q. … put forward. And you would also agree- or would you also agree that by this point in time you had already tendered sworn documents as, as part of the proceeding? This was not the first time you had tendered sworn documents.
A. No, that’s correct.
Q. And at- so I’m going to suggest to you that at this point in time you understood the importance of a sworn document.
A. Oh, I understand the importance, and at that time, yes, I did.
Q. And so, again, I’m suggesting to you that that does not mesh with your evidence that you prepared these May 2013 affidavits in a rush.
A. I didn’t prepare them in a – my lawyer prepared them in a rush. He told me I have to sign them.
MS. KADOORY: Q. So, so do you typically sign sworn statements without putting much thought into them, without even understanding them?
A. In this case, in this case I actually, when I got the emails of these affidavits I read a couple of them and they basically looked the same so I thought, okay, print them out, I signed then, and then just fax them through. And that’s really- and I am guilty of not being more thorough.
Q. So back to your evidence that nothing was happening in a period from 2012 to 2014. You would agree that after you, you signed documents that you allegedly never read, you had plenty of time, given that nothing was going on in the file, to correct them. Did you not?
A. I, I guess so. I was never advised that we should be correcting them. I, I’m not a lawyer. I don’t know the procedures.
Q. So, so it’s your lawyer’s fault?
A. Well, yes. And he, he gave them to me to sign, he knew the status of my business, okay? He gave them to me to sign and then he never advised me once. I said, well, wait a minute, this is, when we were advised by the Applicant’s side that there was a problem, he never advised me that by the way we should correct these. I, I didn’t know we were supposed to correct them.
Q. And at no time did you correct them. You’ve never put in…
A. No, I never did because I was never advised to do so. If we were advised to do so, I would have put in a statement saying this is why we did it and this is the problem.
Q. Now…
THE COURT: It was drawn to your attention by counsel for Ms. Tsinokas that there were errors in the affidavits?
A. Yes, it was brought- yes.
A. Absolutely it did. And as I said earlier to your questions, I signed this without realizing what it actually was, was being written because I just printed it out and I signed it. I did not pay attention to what I was signing. Some of these- actually, some of them that I read are correct. There’s nothing wrong with them. Jend, Clark Robotics and TCI are incorrect, and I already said that.
Q. I missed it.
A. So you can question me about the fact that, yes, there is expenditures there, I know there were. I know there’s contracts. I’ve admitted it. There’s no issue there. I signed the wrong document under the, under the understanding that my lawyer wrote the right thing down. And I’m guilty of the fact that I didn’t, I was, I was, I don’t know, tardy.
[38] In my view the evidence of Mr. Feldman and the Respondent’s attitude to disclosure are consistent in explaining to a large extent the difficulty in disclosure created by the Respondent. I find that his conduct in relation to disclosure was unreasonable as being inattentive to his duty to make full and fair disclosure; I am not convinced that he acted in bad faith by deliberately concealing information.
[39] The principles I have reviewed, both the case law and the rules, establish that the Respondent’s conduct regarding disclosure trumps any success he may have had. I do not see the changes in the rules on July 1, 2018 as affecting that result. FLR 24(4) is illustrative of the basis of my reasoning.
[40] Accordingly, I award the Applicant costs on a substantial recovery basis, where costs are before me.
[41] I have already found that on principle I am not to award costs on any step, including a conference, where costs have not been reserved to the trial judge.
[42] I must now fix the quantum of costs, having regard to my findings and the governing principles I have earlier reviewed.
[43] I fix those costs at $266,892.32 inclusive of fees, disbursements, and applicable taxes. They are payable to the Applicant by the Respondent within 60 days.
IV. Submissions on Costs of the Hearing Before Me
[44] I will receive written submissions on costs of the hearing before me, including any costs which may ultimately have been reserved to me as a result of paragraph 3 of my order of May 16, 2017. Costs submissions shall be limited to 4 pages, excluding a bill of costs.
[45] The Applicant shall serve and file her submissions within 14 days from release of this endorsement. The Respondent shall serve and file his submissions within 14 days from service of the Applicant’s submissions. There shall be no reply.
Bloom, J. DATE: July 6, 2018