Court File and Parties
Date: 2024-08-15 Superior Court of Justice – Ontario
Re: Galit Altman, Applicant And: Yoel Altman, Respondent
Before: M. Kraft, J.
Counsel: Julie Hannaford and Angela Pagano, for the Applicant Darrell S. Waisberg, for the Respondent
Heard: In writing
Costs Endorsement
1This is the costs endorsement arising out of a long motion brought by the wife seeking to strike the husband’s pleadings because of his ongoing breaches of the Orders of Faieta, J., dated October 5, 2021, November 12, 2021, and December 14, 2021 (“the 2021 Faieta Orders”). The motion was returnable before me on July 4, 2024 and was argued as a full-day motion.
2On July 15, 2024, I released an Endorsement finding the husband to be in breach of several terms of the 2021 Faieta Orders. I granted the husband one final 45-day period to comply with the outstanding disclosure and imposed a penalty/fine of $3,000 a day for each day from the date of the release of my Endorsement. Further, the husband was not permitted to bring any further proceedings or seek further relief from the court until he complied with the 2021 Faieta Orders.
3The starting point in any costs analysis is the presumption that a successful party is entitled to costs: rule 24(1) (Jackson v. Mayerle, 2016 ONSC 1556, Sims-Howarth v. Bilcliffe, [2000] O.J. No. 330). There is no question that the wife was the successful party on the motion.
4The wife seeks costs of the motion approaching substantial recovery in the rounded sum of $120,000, inclusive of fees and taxes.
5The husband submits that the wife did not provide satisfactory documents to support her request for costs in the sum of $120,000 and therefore, she ought not to receive costs, or alternatively, a substantially reduced amount ought to be awarded. He also argues that any costs award in the wife’s favour be set off by costs he ought to be awarded for relief she abandoned.
6Separate and apart from the parties, Grandhill Capital Inc. (“Grandhill”), a non-party, seeks its costs of the motion, either on a full indemnity basis of $29,754.03; $22,315.52 on a substantial indemnity basis or $14,894.52 on a partial indemnity basis.
7Grandhill is a corporation owned 50% by the husband and 50% by a third party.
8As part of the wife’s Rule 1(8) motion, she sought relief against Grandhill as follows:
a) Initially, she sought an order that all of Grandhill’s assets be preserved, or alternatively, that the sum of $1,185,031 be preserved out of any share of Grandhill’s assets that do not belong to the husband. This relief was set out in the wife’s Notice of Motion, dated March 13, 2024;
b) She then amended her Notice of Motion, seeking an order that the Faieta Order of October 5, 2021 applies to the assets of Grandhill. This relief was set out in the wife’s Amended Notice of Motion, dated April 18, 2024.
9On April 22, 2024, the wife amended her Notice of Motion a third time and withdrew her request for relief against Grandhill.
10Grandhill’s position is that as a result of the wife’s decision to seek relief against Grandhill, it was required to retain counsel to review the material file, consider its position and prepare a response. By the time the wife served and filed her Amended Amended Notice of Motion, dated April 22, 2024, Grandhill submits it had already incurred costs.
Legislative Provisions for Costs as between the parties
11Modern family costs rules are designed to foster four fundamental purposes: to indemnify successful litigants for the cost of litigation, to encourage settlements, to discourage and sanction inappropriate behaviour by litigants, and to ensure that cases are dealt with justly: Mattina v. Mattina, 2018 ONCA 867, at para. 10. The touchstone considerations of costs awards are proportionality and reasonableness: Beaver v. Hill, 2018 ONCA 840, at para. 12. The reasonable expectations of the unsuccessful party are a relevant consideration: Delellis v. Delellis, [2005] O.J. No. 4345.
12Subject to the provisions of an Act or the rules of court, costs are in the discretion of the court, pursuant to s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43. By r. 24(10)(a) of the Family Law Rules, O. Reg. 114/99 (“FLRs”), the court is directed to make a decision on the costs of a step in the case promptly after dealing with the step, in a summary manner.
13Pursuant to r. 24 of the FLRs, the successful party is presumptively entitled to costs, subject to the factors set out in r. 24: Beaver, at para. 10. In setting the amount of costs, the court must consider the reasonableness and proportionality the factors listed in r. 24(12) as they relate to the importance and complexity of the issues. These factors include each party’s behaviour, the time spent by each party, any written offers to settle, including those that do not meet the requirements of r. 18, any legal fees and any other expenses, and any other relevant matter.
14There is no general approach in family law of “close to full recovery costs”: Beaver, at para. 11. Rather, full recovery is only warranted in certain circumstances, such as bad faith under r. 24(8), or beating an offer to settle under r. 18(14): Beaver, at para. 13.
15The 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] O.J. No. 252, 2013 ONCA 35; Delellis v. Delellis, [2005] O.J. No. 4345, 2005 CarswellOnt 4956 (S.C.J.); Murray v. Murray (2005), 79 O.R. (3d) 147, [2005] O.J. No. 5379, ; Guertin v. Guertin, [2015] O.J. No. 4585, 2015 ONSC 5498 (S.C.J.)).
16Rules 18 and 24 of the FLRs 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 (Jackson v. Mayerle, 2016 ONSC 1556 (SCJ); M. (C.A.) v. M. (D.) (2003), 67 O.R. (3d) 181, [2003] O.J. No. 3707; Andrews v. Andrews, [1980] O.J. No. 1503, 21 R.F.L. (2d) 348 (C.A.); Wilson v. Kovalev, [2016] O.J. No. 103, 2016 ONSC 163 (S.C.J.)).
17Rules 18 and 24, and most of the case law, focus on two words: "Success" and "Reasonableness". The latter entails two components: reasonableness of behaviour by each party; and reasonableness of the amount of costs to be awarded.
Legislative Provisions regarding costs sought by a non-party
18Rule 24 of the FLRs does not address costs sought by a non-party. As such, matter not adequately address in the FLRs may be decided by analogy to the Courts of Justice Act, R.S.O. 1990, c.C.43 and, if appropriate, the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, pursuant to Rule 1(7) of the FLRs.
19Rule 12(3) of the FLRs provides that a party who withdraws an application, answer or reply shall pay the costs of every other party in relation to the withdrawn application, answer or reply, unless the court orders otherwise or the parties agree otherwise. The FLRs do not address the costs of an abandoned motion, as was the case in this matter.
20Section 131 of the Courts of Justice Act provides the Court with broad discretion to award cost as appropriate.
21Rule 37.09(3) of the Rules of Civil Procedure set out that where a motion is abandoned or deemed to have been abandoned, a responding party on whom a notice of motion is served is entitled to its costs of the motion forthwith.
Offers to Settle
22Rule 18 sets out cost consequences where a party fails to accept an offer which the other party then meets or exceeds at trial. The successful party is entitled to costs until the offer was served, and "full recovery" of costs from that date: Angle v. Angle, 2024 ONSC 1758 (SCJ).
The Husband’s Offer to Settle
23On May 23, 2024, the husband made an Offer to Settle which provided as follows:
a) The wife was to consent to an order dismissed the relief set out in her Amended Amended Notice of Motion, dated April 22, 2024; and
24If the Offer was accepted prior to May 27, 2024, there would be no costs. If the Offer was accepted after May 27, 2024, the wife would pay the husband’s costs of the motion. I find that the husband’s Offer to Settle was not capable of being accepted by the wife since it was an all-or-nothing Offer, it was not a realistic offer, it was a binary choice and represented no compromise on his part: Beaver v. Hill, 2018 ONCA 840; Williams v. Williams, 2019 ONSC 6586. Accordingly, I do not consider the husband’s Offer to Settle in determining the costs of this motion.
25The wife did not make an Offer to Settle. I do not consider the lack of an offer on the wife’s part to demonstrate unreasonable behaviour since the motion was centred on the husband’s breach of Court orders and there is no compromise position that could have been taken. A party is not obliged to make an Offer to Settle, and it is not unreasonable to not serve an Offer to Settle: Beaver v. Hill, 2018 ONCA 840.
Rule 24 Factors
Unreasonable Behaviour
26Rule 24(5) provides that in determining whether a party has behaved reasonably or unreasonably, the court shall examine the party’s behaviour in relation to the issues from the time they arose.
27The wife argues that the husband behaved unreasonably in relation to this motion as follows:
a) He caused the hearing of this motion to be delayed multiple times, first by switching counsel, and then by arguing that the motion should be converted into a long motion, despite agreeing in February 2024 to a regular motion hearing. As a result of adjournments sought by the husband, after Diamond, J. first granted the wife leave to bring this motion in February 2024, there were four additional attendances before the court addressing the motion to strike; namely two attendances before Maxwell, J., one case conference before Diamond, J., and one attendance before me, prior to the motion being heard in July 2024. At each court attendance, the wife was required to prepare additional materials and put to increased costs.
b) The court had provided the husband with directions on numerous occasions to comply with the orders made by Faieta, J. for disclosure, including making financial payments, preservation of payments and other relief and he did not do so;
c) The issue of the husband’s non-disclosure was before this court at the first case conference in May 2021;
d) In November 2021, the wife brought a motion seeking to strike the husband’s pleadings for the first time for non-disclosure. The husband then provided the wife with thousands of unorganized pages of financial records on the eve of the motion hearing.
e) Although the husband’s Answer was not struck, he was given a further 3-months to comply with prior Orders.
f) In July 2022, the wife brought a second motion to strike the husband’s pleadings. Faieta, J. granted the husband another chance to comply with the 2021 Faieta Orders. If by November 4, 2022, the husband remained in non-compliance with the 2021 Faieta Orders, the wife was entitled to bring whatever motion she deemed necessary.
g) The husband was also ordered to sign Authorizations and Directions the wife had prepared to grant her full access to his personal and corporate records because he had not produced these records.
h) By the time the wife’s third motion to strike was heard, the husband remained in non-compliance with the 2021 Faieta Orders, having not provided her with any disclosure in over a year. At the motion hearing, the husband argued that he did not understand that he had an ongoing rolling obligation to provide the wife with disclosure despite the Faieta, J. order dated October 5, 2021 which specified a 30-day rolling period as the “reporting period” and the Endorsement of Diamond, J., dated January 30, 2023 which referred to the husband’s “rolling disclosure obligation.”
i) The husband defended his non-disclosure by having signed Authorizations and Directions, arguing that in doing so, he indirectly provided the wife with disclosure.
j) The husband’s breach of court orders placed the children’s education at risk because he refused to pay for the school tuition.
28The husband denies that he behaved unreasonably in this matter. He argues that he should not be held responsible for the costs relating to various adjournment requests because he submits that these adjournment requests were the direct result of the wife’s unreasonable conduct, which he describes as follows:
a) His initial request for an adjournment was as a result of his prior counsel removing themselves from the record and the wife refused to agree. The wife’s attempt to proceed with her motion on March 28, 2024 when she was aware that the husband’s counsel was only recently retained and out of the country was heavy handed and unreasonable.
b) The wife’s counsel originally scheduled the motion to be heard on the regular motions list for 1-hour motions. The husband’s agent advised the court on March 28, 2024 that a long motion was needed, which was denied because the wife’s counsel represented to the court that the motion could be argued in 1 hour. In the end, the motion was argued over a full day and could never have been argued as a 1-hour motion on the regular motions list.
c) Despite the wife including Grandhill Capital Inc. in her original Notice of Motion, she insisted that counsel for Grandhill Capital Inc. did not have to attend the motion, necessitating Maxwell J. adjourning the motion to accommodate counsel for Grandhill to be in attendance.
d) The wife would not agree to allow the husband to provide a supplementary Factum in response to new issues raised in her reply affidavit, sworn on April 19, 2024, necessitating an attendance before me on June 20, 2024. I granted the husband the opportunity to file a supplementary factum.
29The husband argues that all of these court attendances could have been avoided if the wife consented to the adjournment requests and, as a result, costs of $10,901 should be set off against any costs ordered by the court.
30I am not persuaded that either party behaviour was responsible for the adjournments of the motion. A change in counsel, and a determination that a longer period of time was needed to argue the motion necessitated the delay in this motion being heard.
31The husband also argues that the wife’s unreasonable conduct of withholding his mail is a federal offence which should be considered a factor for the court to reduce the amount of costs she is awarded given this unreasonable conduct. I do not agree. The wife has provided the husband with the details of his mail at the matrimonial home. It has been within his ability to retrieve his mail. He has not done so and choses to use this against the wife.
32Further, the husband argues that the wife relied on 4 different affidavits in support of her motion, by filing improper reply evidence and as such, she breached the consolidated Practice Direction for Family Proceedings, thereby demonstrating further unreasonable conduct on her part which ought to reduce the costs which she may be awarded. I am not persuaded that the additional filing of materials on this motion should result in either party being awarded costs at a higher or lower amount. This motion was important and complex in that it is necessitating taking the Court through the chronology of events from the time the 2021 Faieta Orders were made. Given the adjournments of the motion and the multitude of undisclosed accounts, supplementary affidavits and material was needed. Both parties had the same opportunity to file additional materials from that which is normally required on a motion.
33Finally, the husband argues that the wife ought to be responsible for his legal fees associated with the withdrawn motions up to the date she withdrew the motions, when she served her Amended Amended Notice of Motion, dated April 22, 2024. Rule 14(16) of the FLRs sets out that a party making a motion may withdraw it is the same way an answer or application is withdrawn under Rule 12, which provides that a party withdrawing an Answer or application or reply may pay the costs of every other party relating up to the date of withdrawal, unless otherwise ordered or agreed to. Specifically, the husband submits that the sum of $6,069 should be set off against any costs order made against him, which are the fees associated with the withdrawn motion.
34Grandhill argues that the wife behaved unreasonably in connection with this motion as follows:
a) The wife unilaterally decided to alter and then withdraw her motion against it, leaving Grandhill with no opportunity to argue its position before the Court. This was notwithstanding the fact that Grandhill had already incurred costs by the time the wife took that step.
b) After the wife withdrew her motion against Grandhill, she took the position that counsel for Grandhill ought not to be permitted to participate in the proceeding. She took this position despite not having withdrawn or amended the affidavit evidence which referenced Grandhill. Specifically, the wife’s March 13, 2024 affidavit deposed that the husband was a 50% shareholder in Grandhill, where her April 15, 2024 affidavit asserted that the husband was a 100% shareholder. The husband is a 50% shareholder so her later affidavit was incorrect.
c) Grandhill was required to attend before Maxwell, J. on April 26, 2024 at a TBST attendance to argue its right to attend the hearing of the motion.
d) Grandhill was required to attend before me on May 23, 2024 to defend its right to be present at the hearing of the motion.
e) Although the wife did not raise any issues specific to Grandhill at the July 4th motion, Grandhill’s counsel attended the hearing and spoke briefly to assert its right to make a claim for costs.
Analysis of Reasonable or Unreasonable Behaviour
35I made several findings in my Endorsement that the husband willfully breached the 2021 Faieta Orders.
36Throughout my Endorsement, I made findings that the husband had plenty of opportunities to cure his disclosure-related breached and he did not do so. I made findings that the husband relied on the “complexity” of his finances to justify missing, late or vague information about his income and net worth.
37Based on the above, I find that the husband behaved unreasonably in relation to the issues of disclosure from the time they arose and, in his breaching, the 2021 Faieta Orders. As a result, this conduct ought to increase the amount of costs he is ordered to pay the wife.
38I do not find that the wife behaved unreasonably in these proceedings.
Importance
39There is no doubt that this matter was of significant importance to both parties and each party incurred spent significant legal fees. It is not surprising that the wife’s legal fees significant exceed the husband’s legal fees since she was forced to take on the responsibility of obtaining the husband’s disclosure through the Authorizations and Directions, because of his refusal to do so. This necessitated significantly more time that it would have taken him to obtain his bank records, given his familiarity with his accounts. Further, the wife was put to the expense of having someone go through every transaction to track monies in and out of a significant number of bank accounts. As a result, the husband should have expected to pay costs if he were unsuccessful.
Amount of Costs to be Awarded to the non-party because of the wife abandoning the relief sought against the non-party
40Where a party to a family law proceeding decides to no longer pursue a motion – even if it is not technically “abandoned” – the respondent to the motion is entitled to costs: Cameron v. Cameron, 2015 ONSC 6071 at para 4.
41Family law courts have adopted civil authorities which have found that a higher scale of costs may be appropriate where motions are abandoned: Murphy v. Murphy, 2010 ONSC 6204 at paras 42-45.
42When assessing costs in favour of a non-party, the principles of reasonableness and proportionality continue to apply: Cohen v. Estate of Cohen, 2023 ONSC 1481 at para 36, citing Beaver v. Hill, 2018 ONCA 840.
43On this basis, Grandhill argues that it is entitled to be fully reimbursed for its unnecessary participation in these proceedings by being awarded its full indemnity costs. Alternatively, Grandhill seeks costs on a partial or substantial indemnity basis.
44In terms of the wife’s behaviour toward the non-party, Grandhill, I find that her decision to involve Grandhill was reasonable given the challenges she had in getting proper disclosure from the husband. I also find that the withdrawal of the motion in which she sought relief against the company was one which has consequences; the question is who should bear those consequences? While I cannot find this conduct on the wife’s part to be unreasonable, I do find that Grandhill was put to expense for a motion that was ultimately withdrawn. However, because it was the husband’s conduct that necessitated the motion against Grandhill, I find that the husband should be responsible for Grandhill’s costs.
Amount of Legal Fees
45In considering the quantum of costs, the court should also consider Rule 1(8), which provides that the court may respond to a failure to follow the Rules or abide by an order by making an order for costs, and Rule 2(2), which provides that one of the primary objectives of the Rules is to ensure that cases are dealt with justly (Mooney v. Fast, 2013 CarswellOnt 15659 (O.C.J.)).
46The principles of proportionality and reasonableness are “the touchstone considerations to be applied in fixing the amount of costs” (Beaver, at para. 12). 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 (Lupien v. Carmichael, 2017 ONSC 2929 (S.C.J.); Darling at para. 12).
47As a starting point in determining the appropriate quantum of costs, the court has an obligation to review the specifics of the Bill of Costs to assess whether items claimed are properly the subject of a costs award, and if so, to consider the reasonableness of the amounts requested (Donnelly v. Donnelly, 2004 CarswellOnt 2076 (S.C.J.); Snelgrove v. Kelly, 2017 ONSC 4625 (S.C.J.)). The court must as part of this process consider whether all of the items claimed actually relate to the legal step in question, and whether the hours spent can be reasonably justified (Pagnotta v. Brown, [2002] O.J. No. 3033 (S.C.J.); Murphy v. Murphy, 2010 ONSC 7204 (S.C.J.); Jackson; Snelgrove; Beaver). The goal of this exercise is to come up with an amount that the court considers to be a reasonable and proportionate full indemnity amount from which the balance of the quantification analysis can then be carried out. However, this analysis should be undertaken in a global fashion. The court is not required to embark upon a painstaking, line-by-line analysis of Bills of Costs and second guess every hour and item docketed, unless there are clear concerns about excessive claims and overreaching (Docherty v. Catherwood, 2016 ONSC 2140 (S.C.J.), at para. 50; Snelgrove).
Analysis of the Bills of Costs
48I have reviewed the wife’s Bill of Costs. There were four lawyers working on her team. Julie K. Hannaford is a 1985 call and her hourly rate is $850. Ms. Pagano is a 2019 call and her hourly rate is $400. Jamie Ahn and Danielle Rafalson are both 2023 calls and their respective hourly rates are $350.00. In addition to lawyers, the wife’s legal team is comprised of five other individuals, being an articling student, a summer student, a senior law clerk, an office manager and a legal assistant. These hourly rates are reasonable.
49The husband argues that in the wife’s cost submissions, she failed to attach any docket entries, invoices or breakdowns showing the date that work was performed, particulars of what work was performed, who performed it and the amount of time spent. I agree with the husband that the wife’s Bill of Costs does not attach docket entries or breakdowns showing the date that work was performed or the particulars of what work was performed. However, the Fee Summary does break down who performed work on the file and the amount of time each person spent on the matter. In the wife’s reply costs submissions, comprehensive dockets were attached.
50The Fees Summary put forward in the wife’s costs submissions sets out the hours spent by each counsel, law clerk and student on her team. A total of 340.70 hours were spent on this motion. The bulk of legal time was spent by Ms. Pagano, being 145.40 hours (at $400 an hour), totaling $58,160 and by Ms. Ahn, being 113.30 hours (at $350 an hour), totaling $39,655; Ms. Rafalson spent 2.3 hours, totaling $805;and Ms. Hannaford, spent a total of 27.3 hours, totaling $23,205, representing only 8% of the time and cost incurred by the wife. The senior law clerk spent 36.2 hours on the motion, totaling $10,680 and the articling and summer students combined spent 11.5 hours on the motion. The Office Manager spent 0.6 hours on the motion and the legal assistant spent a total of 4.1 hours on the motion.
51In the circumstances, I find that Ms. Hannaford employed a team approach on this motion and ensured that lawyers who bill out at lower hourly rates were used for the majority of the time spent on the matter. However, I do view 340 hours to be excessive for what was ultimately a 6.5-hour motion.
52The husband relies on cases where the court has found that a party seeking costs must provide a detailed breakdown of what services were rendered in order to determine whether the fees and disbursements claimed are reasonable and proportionate. The husband further argues that it would be inappropriate to allow the wife’s counsel to provide a more particularized breakdown of dockets in her reply costs submissions because she could have done so in her initial costs submissions and she failed to do so. I agree. These dockets should have been provided in first instance given the costs being claimed – but that does not have any material impact on my decision.
53The husband contests the hourly rates sought by the wife in her Bill of Costs and the fact that she has a legal team with 9 individuals having worked on the motion on the basis that the fees are far too high for the four lawyers for their respective years of call and experience and he argues ought to be substantially reduced. Further, he contests the fact that the wife was charged time by administrative staff at hourly rates for individuals not qualified to do legal work, such as a legal assistant or office manager. Finally, the husband contests the amount of time the wife’s legal team has spent on the motion. The four lawyers collectively spent 288.30 hours on the motion, which he argues is excessive and unreasonable. Given the lack of transparency, and no breakdown as to who did what, when and for how long, the husband argues that it is impossible to know what tasks were undertaken. By comparison, the husband’s Bill of Costs amounted to $17,850, plus HST on the motion, after deducting amounts for unnecessary adjournments attendances and the time spent responding to the wife’s abandoned claims.
54A useful benchmark for determining whether costs claimed are fair, reasonable and proportional is to consider the time that the other party has spent and the amount they have paid for their own legal fees and disbursements in the matter (Smith Estate v. Rotstein, 2011 ONCA 491 (C.A.); Durbin v. Medina, 2012 ONSC 640 (S.C.J.); Scipione). Although there is no requirement that a party resisting costs file their own Bill of Costs, it is preferable that they do so to assist the court in dealing with costs in a fair and reasonable manner (Risorto et al. v. State Farm Mutual Automobile Insurance Co., 2003 ONSC 43566 (S.C.J.), at para. 10). Failure on their part to provide details regarding their own time spent and costs incurred is a factor that the court may take into account in considering the reasonable expectations of the losing party and may entitle the court to draw an adverse inference (Smith Estate, at para. 50; Scipione, at para. 126; 206637 Ontario Inc. (c.o.b. Balkan Construction) v. Catan Canada Inc., 2013 ONSC 5448 (S.C.J.), at para. 7). In addition, a significant discrepancy in the amount of fees that the parties have incurred may prompt the court to embark upon a more detailed scrutiny of the costs claimed to ensure that the amount meets the overall objectives of a costs order (Jackson, at para. 99).
55In terms of secretarial time vs. law clerk time, I find that such costs are part of a lawyer’s overall overheard and are recovered in the hourly rate charged by Ms. Hannaford. Work completed by a law clerk is properly chargeable under the Rules of Civil Procedure and the Tariff under the Rules. I have conducted a review of the dockets and reduced the wife’s account for “secretarial work” as sought by the husband: Beerthuizen v. West Arthur Place, [2008] O.J. No. 110; L.(J.K.) v. S.(N.C.), 2009 CarswellOnt 1017; Grimba v. Bossi, 2012 Carswellont 5840; Lanteigne v. Lanteigne, 2016 ONSC 1514.
56I have also reduced the wife’s legal fees for the time spent by lawyers "reviewing file" or "conferring" or "filing": Czegledy-Nagy v. Seirli, 2012 CarswellOnt 1077; Doering v. Doering, 2016 ONSC 2551.
57In this case, the husband’s Bill of Costs amounted to $17,850, plus HST; the wife’s claimed costs are close to seven times more. It is noteworthy, that the fees incurred by Grandhill were higher than those incurred by the husband. While the wife’s legal fees are excessive, the husband’s legal fees seem inexplicably low for a motion of this importance.
58In any case, the FLRs do not require the court to allow the successful party to demand a blank cheque for their costs (Slongo v. Slongo, [2015] O.J. No. 2648, 2015 ONSC 3327 (S.C.J.)). The court retains a residual discretion to make costs awards which are proportional, fair and reasonable in all the circumstances (M. (C.A.) v. M. (D.), supra; Scipione v. Scipione, supra).
59In Sepiashvili v. Sepiashvili, supra, Justice Wildman J. stated, at para. 20:
Regardless of the outcome of the case, a client is not entitled to direct vast resources to litigation and expect full reimbursement. When the rules use the term "full recovery costs", there is an implied qualification that the costs incurred must be reasonable. There must be some assessment of the most effective use of resources to present the case, and some attempt to approach the matter in a cost-effective manner. [page706]
60Simplistically, a common theme in the "reasonable expectations" and "proportionality" analyses is that the loser should not have to reimburse the winner for excessive or unnecessarily expensive litigation behaviour which might be regarded as "overkill" (Scipione v. Scipione, supra).
61I have reviewed the wife’s dockets, attached at Tab “A” to her reply costs submissions. A significant amount of time was spent by the wife’s legal team to address the Authorizations and Directions, speak with the banks, review, and analyze the statements and prepare disclosure charts to determine what remained outstanding. In my view, these are fees for which the husband should be paying given that it is his positive obligation to have produced this disclosure to the wife and he failed to do so.
62In terms of the disbursements claimed the wife, the husband takes issue with the fact that no invoices or proof of payments or particulars were provided to demonstrate whether these disbursements were reasonably incurred. I do not find the claimed disbursements to be unreasonable in the circumstances.
63I am satisfied that the costs claimed by the wife are excessive, despite the conduct of the husband, which I find to have been unreasonable. In terms of an overview of the accounts submitted by the wife’s counsel, I find that 340 hours of time spent on this long motion is excessive and not proportional. I do not propose to adjust the disbursements incurred by the wife. I recognize that incurring disbursements expense is essentially the exercise of judgment by counsel, which must be examined at the time the work is done.
Grandhill’s Costs
64Counsel for Grandhill seeks costs of $26,331 incurred in connection with the July 4, 2024 hearing. The wife argues that of this sum, $20,828.50 was incurred after April 22, 2024, by which time, all relief affecting Grandhill had been eliminated from the motion. She submits that any participation by Grandhill after April 22, 2024 was undertaken at the insistence of Grandhill. Further, of the $5,502.50 in costs incurred by Grandhill up to and including April 22, 2024, dockets relating to the preparation of an affidavit of P. Kirby, when such an affidavit was never served nor filed in connection with this motion. Further, several appearances were prolonged or adjourned because of Grandhill’s insistence on participating in this motion. The wife’s position is that the husband was the driving force behind Grandhill’s unnecessary involvement in this motion, especially since all affidavits served on behalf of Grandhill were affidavits of the husband. She is not wrong. On this basis, the wife submits that the court should decline to award costs to Grandhill.
65I find that Grandhill was required to attend at Court even after the wife abandoned the relief, she sought against the company given that allegations were made in connection Grandhill that were not accurate and that material remained on the record. However, I also find that Grandhill’s involvement was necessitated by the husband’s conduct.
66The Court has considered the factors set out in Rule 24 of the Family Law Rules and a fair, reasonable, and proportional award for costs of Grandhill, as a non-party, in light of the wife having abandoned the motion against it is that Grandhill be awarded $10,000 (inclusive of HST and disbursements) payable by the husband within 30 days.
67In light of my findings above, the court assesses a reasonable and proportionate amount payable for this motion to the wife is $50,000 (inclusive of HST and disbursements) payable by the husband within 30 days.
M. Kraft, J.
Released: August 15, 2024
