Court File and Parties
Court File No.: FD151/16 Date: May 6, 2019 Superior Court of Justice – Ontario Family Court
Re: John Anthony Shelley, applicant And: Josephine Anne Shelley, respondent
Before: MITROW J.
Counsel: Monique Rae Bennett for the applicant Jordan D. McKie for the respondent
Heard: written submissions filed
Endorsement
Introduction
[1] The sole remaining issue is whether an order should be made allowing the Director to enforce the trial costs ordered to be paid by the respondent to the applicant, in circumstances where the respondent’s only claim at trial, which was for spousal support, was dismissed [1].
Brief Background
[2] The respondent was in receipt of spousal support pursuant to a separation agreement signed by the parties. When the applicant commenced his application seeking a divorce only, the respondent sought spousal support pursuant to the Divorce Act, R.S.C., 1985, c. 3 (2nd Supp.) in an amount substantially in excess of the amount she was receiving prior to the separation agreement.
[3] The result of the judgment was that the applicant continued to pay spousal support as set out in the separation agreement.
[4] The parties were permitted to make submissions on costs and did so. The trial costs decision was released on January 29, 2019 [2].
[5] The respondent was ordered to pay costs as set out in para. 63:
(63) I make the following final order:
The respondent shall pay to the applicant his costs of this proceeding fixed in the amount of $80,510 inclusive of disbursements and HST, payable on the terms set out in paragraph 2.
The costs shall be paid as follows:
a) $620 per month on the first day of each month commencing March 1, 2019 until paid in full;
b) in the event that the respondent’s entitlement to spousal support ends prior to the payment of costs in full, then within 30 days thereafter, any outstanding costs still owing by the respondent to the applicant shall be paid in full.
[6] The spousal support payable pursuant to the separation agreement had a maximum duration until December 2029. The quantum of support was $2,500 per month indexed. The payment of $620 per month towards costs was explained at para. 59:
(59) In the present case, if the costs order starts to be paid March 1, 2019, then the maximum duration to December 2029 is 130 months. The result is an average monthly payment of $619.31 per month, which I round to $620. If entitlement to spousal support ends prior to December 2029, then the full amount of costs owing shall be paid.
[7] Pursuant to s. 1(1) of the Family Responsibility and Support Arrears Enforcement Act, 1996, S.O. 1996, c. 31 (“FRSAEA”), the following definition is included:
“support order” means a provision in an order made in or outside Ontario and enforceable in Ontario for the payment of money as support or maintenance, and includes a provision for,
(g) interest or the payment of legal fees or other expenses arising in relation to support or maintenance,
[8] In the trial costs endorsement, I declined to make an order that the costs to be paid by the respondent are enforceable by the Director on the basis that the applicant’s request for same was advanced in reply submissions. Paragraphs 61 and 62 of the trial costs endorsement deal with the enforcement issue:
(61) Enforcement of a costs order could subject the respondent, potentially, to an enforcement proceeding by the Director. It appears that a costs order made in favour of a successful party may be made enforceable by the Director where a claim by the unsuccessful party for support has been dismissed (see, for example, Clark v. Clark, 2014 ONCA 175 (Ont. C.A.), particularly at paras. 75-79 and para. 105, where the court permitted costs ordered in favour of the successful party to be enforced by the Director in circumstances where the unsuccessful party’s child support claim had been dismissed).
(62) However, in the case at bar, I decline to make that order because it was advanced, improperly, in reply submissions leaving no opportunity for the respondent to address the issue.
[9] Following the release of the trial costs endorsement, the applicant’s counsel pointed out in writing, and correctly, that the applicant’s request for costs to be enforced by the Director was contained in his initial written submissions.
[10] On the basis that the decision as to enforcement by the Director was based on procedural grounds rather than on the merits, I permitted both parties to make supplementary submissions on this issue. Written submissions were received from both parties.
[11] The applicant submits that the costs order should be enforced by the Director and the respondent opposes this request.
Discussion
[12] Both parties make reference to the decision of the Court of Appeal for Ontario in Clark v. Clark, 2014 ONCA 175. That decision was referred to in the trial costs endorsement in para. 61 quoted earlier in these reasons.
[13] The respondent attempts to distinguish Clark, and submits that Clark does not stand for the proposition that a support payor may have costs in his favour enforced by the Director as against a recipient of child support (paragraph 6 of the respondent’s submissions). The respondent adds that the Court of Appeal did not rule that the Director could enforce a costs order in favour of a support payor against the support recipient; there was no support payor or recipient (paragraph 13 of the respondent’s costs submissions).
[14] I am unable to agree with the respondent’s characterization of Clark and the respondent’s apparent suggestion that Clark is not of assistance in the case at bar.
[15] The trial decision in Clark [3] involved a motion to change a final order. The father sought an order requiring the mother to pay ongoing periodic child support in accordance with the Guidelines. The mother similarly sought an order against the father for child support pursuant to the Guidelines. She also sought an order for s. 7 expenses and she also raised the issue of costs of the psychological assessment and the counselling fees incurred for the children.
[16] At para. 14, the Court of Appeal for Ontario summarizes the trial judgment:
14 By orders dated February 3 and 14, 2012, the trial judge disposed of several substantive issues between the parties (collectively, the "Trial Judgment"). He dismissed Gregory's claim for child support, ordered support to be paid on account of s. 7 extraordinary expenses, and directed Gregory to pay 50% of the costs of the psychological assessment and the counselling fees incurred for the children. Thus, Georgia was largely successful at trial.
[17] The trial judge ordered costs to be paid by the father in the amount of $185,000. The costs were ordered to be paid as “lump sum spousal support” and were ordered to be enforced by the Family Responsibility Office: para. 15.
[18] In Clark, no claim had been advanced for spousal support. It was on that basis that the appellate court concluded that the trial judge erred by characterizing the costs as lump sum spousal support for the purpose of invoking enforcement of the costs by the Family Responsibility Office: para. 72.
[19] However, it was noted by the appellate court that, although the trial judge erred in making the costs award enforceable as spousal support, there was no doubt in the trial judge’s reasons that the trial judge intended the costs to be enforceable by the Family Responsibility Office: para. 75.
[20] The appellate court rejected the father’s argument that, where a child support claim is dismissed, that costs relating to that claim cannot be enforced by the Family Responsibility Office:
76 For his part, Gregory contends that because his claim for child support was dismissed, because no child support was awarded to Georgia at trial, and because Georgia concedes before this court that the costs of counselling and the assessment report for the children are not support-related, only those costs concerning the payment of extraordinary expenses for the children of the marriage under s. 7 of the Guidelines, at best, may properly be viewed as part of a support order under s. 1(1)(g) of the Act for the purpose of FRO enforcement.
77 I disagree. Gregory has pointed to no authority for the contention that where a child support claim is dismissed, costs incurred in respect of that claim cannot form part of a support order enforceable by the FRO.
78 There is no doubt that child support was a live issue at trial. By order dated February 14, 2012, the trial judge dismissed Gregory's claim for child support and further ordered, "There shall continue to be no base child support payable by either parent to the other party."
(my emphasis)
[21] In the end, the appellate court characterized the costs “as support,” rather than “lump sum spousal support,” for the purpose of enforcement by the Family Responsibility Office: para. 105.
[22] In Clark, the costs awarded to a successful party, where the unsuccessful party’s claim for child support was dismissed, were found to be a “support order” enforceable by the Director. There is no principled reason not to permit a similar result where costs are awarded against an unsuccessful party if the dismissed claim relates to spousal support.
[23] In the trial costs endorsement in the case at bar, the relevance of the decision by the Court of Appeal for Ontario in Reisman v. Reisman, 2014 ONCA 109 was discussed at paras. 57-58:
(57) In Reisman, like the case at bar, costs were awarded against the wife in circumstances where she was in receipt of spousal support. The trial judge awarded the husband $250,000 in costs, payable by the wife over ten years in equal monthly installments of $2,083.33 unless the husband’s spousal support obligation ended sooner, in which case the entire award would be due and payable (see para. 75). The trial judge had ordered the spousal support payments to be limited to ten years. The quantum of spousal support was $4,500 per month.
(58) The Court of Appeal for Ontario set aside the ten-year upper limit on spousal support; although the amount of costs was not disturbed on appeal, the court did order that the costs be paid at the rate of only $1,000 per month, but that if the wife’s entitlement to support ends, then she was required to pay the outstanding costs amount (paras. 78-80).
[24] In Reisman, it was noted by the appellate court that the trial judge had ordered the costs award to be enforced under the FRSAEA and that the wife did not challenge this on appeal: para. 80.
[25] In Thompson v. Drummond, 2018 ONSC 4762 (Ont. S.C.J.), Chappel J. notes, in part at para. 45, that courts should interpret s. 1(1)(g) of the FRSAEA broadly in relation to child support claims.
[26] In my view, claims in relation to spousal support should also attract a broad interpretation of s. 1(1)(g).
[27] In Wildman v. Wildman, 2006 CarswellOnt 6042 (Ont. C.A.), the Court of Appeal for Ontario discussed the advantages of s. 1(1)(g) at para. 55:
55 The advantages of an order under this provision are that the costs award is enforceable by the Family Responsibility Office and the order is not discharged in a bankruptcy by virtue of s. 178(1)(c) of the Bankruptcy Act, R.S.C. 1985, c. B-3.
[28] While in most cases s. 1(1)(g) is applied where a successful support recipient receives an award of costs after being successful in obtaining a support order, there is no principled reason to refuse to apply s. 1(1)(g) where a party has successfully resisted an unsuccessful claim for support, whether child support or spousal support: Clark, supra and Reisman, supra.
[29] The respondent relies on Fielding v. Fielding, 2019 ONSC 833 (Ont. S.C.J.), where the trial judge ordered the wife to pay a significant amount of costs that included costs relating to the dismissal of her claim to vary an existing spousal support order. In that case, the trial judge declined, as an exercise of discretion, to order the costs to be enforceable by the Director. One factor considered by the trial judge included that the wife had paid, to date, four significant costs awards totalling almost $700,000.
[30] The exercise of discretion to invoke s. 1(1)(g) depends on the facts of each case. I find no reason on the facts to deprive the applicant of the advantages of an order under s. 1(1)(g), being enforcement by the Director and that the order is not discharged by bankruptcy: Wildman, supra. The entirety of the costs order was in relation to the respondent’s claim for spousal support, in circumstances where the respondent already had a valid separation agreement providing for spousal support.
[31] I order that the costs order made on January 29, 2019 constitutes a “support order” within the meaning of the Family Responsibility and Support Arrears Enforcement Act, 1996 and is enforceable by the Director.
[32] The applicant’s counsel did include a copy of the costs order in the event that the court was inclined to sign the order; however, it is preferable that the draft order be approved by the respondent’s counsel and signed thereafter in the usual course.
“Justice Victor Mitrow” Justice Victor Mitrow Date: May 6, 2019
Footnotes:
[1] Shelley v. Shelley, 2018 ONSC 4516 [2] Shelley v. Shelley, 2019 ONSC 608 [3] Trial decision: Clark v. Clark, 2012 ONSC 1026 (Ont. S.C.J.).
