Court of Appeal for Ontario

Date: 2017-03-24 Docket: C61349

Judges: Weiler, Rouleau and Roberts JJ.A.

Between

Campbell Karl Schulstad Respondent (Applicant)

and

Diann Borden Schulstad Appellant (Respondent)

Counsel

Pam MacEachern, for the appellant

Ron Paritzky, for the respondent

Reasons Concerning Costs

Supplementary to the judgment in Schulstad v. Schulstad, 2017 ONCA 95, released on February 3, 2017.

Endorsement

[1] On February 3, 2017, we allowed in part the appellant's appeal from the application judge's October 23, 2015 order, and directed that the amount of spousal support and insurance benefits, if any, be sent back for determination by another application judge. This Endorsement disposes of the costs of the appeal and of the application below. The application judge had granted the respondent, as the successful party on the application, his partial indemnity costs in the amount of $15,000, inclusive of disbursements and HST.

[2] The appellant submits that the costs order of the application judge should be set aside and that the costs of the application below should be awarded to the appellant in the same amount of $15,000. In particular, she argues that the respondent's failure to disclose relevant financial information additionally justifies her receiving costs on the application below. The appellant seeks her partial indemnity costs of the appeal in the amount of $19,555, inclusive of taxes and disbursements. In total, the appellant asks for costs in the amount of $34,555. The appellant maintains that as a result of the appeal, she was entirely successful and that costs should follow the event.

[3] The respondent maintains that he has achieved the greater success relative to the appellant and should be awarded costs, for the following reasons: the appellant opposed any reduction to spousal support or insurance benefits on the application below; the reduction to monthly spousal support from $10,500 to the interim amount of $1,000 is significant and any further adjustment will likely be modest; the respondent gained the ability to deduct the costs of life insurance premiums from the support. He submits that the award of costs to him on the application below should not be disturbed and that he should have his costs on the appeal in the further amount of $15,000. In total, the respondent asks for costs in the amount of $30,000.

[4] Both parties rely on offers to settle in relation to spousal support and insurance benefits, which they exchanged during a mediation process prior to the hearing of the appeal. We do not find that these offers are of assistance because the amount of spousal support and insurance benefits has yet to be finally determined.

[5] When an appeal is allowed, the general principle is that the order for costs below is set aside and costs are awarded to the successful party on a partial indemnity basis. This court has the discretion to depart from this approach "in unusual circumstances". See Kipij v. Metropolitan Toronto (Municipality), at para. 2; and Hunt v. TD Securities Inc., at para. 2.

[6] Whether the respondent's spousal support and insurance obligations should be terminated or reduced was the main issue on the application below and on the appeal before this court. That the appropriate reduction to the respondent's obligations remains open for determination by another application judge constitutes the kind of "unusual circumstances" that supports a departure from the general principle that the successful party on appeal be granted the costs on the proceeding below.

[7] As a result, while we set aside the application judge's costs order, the costs of the application below and of any further application to determine the final reduced amount of spousal support and insurance benefits are reserved to the application judge. This is the fairest approach for the parties because the application judge will be in the best position to assess the relative success of the parties' positions on the application and to take into account the significance of any offers to settle.

[8] The appellant is entitled to her costs on appeal in the amount of $13,000. She largely prevailed on the main issue, namely, whether spousal support and insurance benefits should be terminated or reduced, although she did take the position that there should be no reduction to the original support order.

K.M. Weiler J.A.

Paul Rouleau J.A.

L.B. Roberts J.A.