Court File and Parties

Court File No.: Toronto: Court File: CFO 13 10220

Date: 2014-01-27

Ontario Court of Justice

Between:

Marjolin Anneleen Nathalie Rasmussen Applicant

— And —

Samuel Olufemi Omotayo Respondent

Before: Justice E. B. Murray

Cost Decision released on: January 27, 2014

Counsel:

• Mr. Peter Tensuda, for the applicant
• Mr. Raymond A. Goddard, for the respondent

Decision

MURRAY, E. B., J:

Introduction

[1] On July 29, 2013, I made a decision on the Respondent Father's motion pursuant to the Hague Convention on the Civil Aspects of International Child Abduction ("Hague Convention"), in which he asked the court find that the parties' child Collin had been "wrongfully retained" by the Applicant Mother in Ontario, and that the court order that the child be returned to New York State forthwith. He also asked that an order obtained by Mother which provided that Collin not be removed from Ontario be rescinded. Mother, who had recently commenced a custody action in Ontario, opposed the request. I made the order sought by Father, and provided that submission on costs be made in writing.

[2] Father in his submissions claims costs at a full recovery level of $14, 956.61. Mother has just recently answered this claim. She acknowledges that Father is entitled to costs, but submits that the amount should be significantly less than at a full recovery level.

[3] This is my decision on the issue.

The Law

[4] Section 131(1) of the Courts of Justice Act provides that the court has discretion to determine the costs of this case, subject to the Family Law Rules:

131.--(1) Subject to the provisions of an Act or rules of court, the costs of and incidental to a proceeding or a step in a proceeding are in the discretion of the court, and the court may determine by whom and to what extent the costs shall be paid.

[5] Rules 24 and 18 of the Family Law Rules significantly structure that discretion. Rule 18 provides for automatic costs consequences in certain situations in which formal offers to settle have been made. No offers were exchanged in this case, and thus Rule 18 has no application. The relevant subsections of Rule 24 are set out below.

Successful Party Presumed Entitled to Costs

24.(1) There is a presumption that a successful party is entitled to the costs of a motion, enforcement, case or appeal.

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.

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.

Divided Success

(6) If success in a step in a case is divided, the court may apportion costs as appropriate.

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.

Factors in Costs

(11) A person setting the amount of costs shall consider,

• (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.

[6] The Ontario Court of Appeal has given us guidance as to the purpose of modern costs rules:

1. Indemnification of a successful litigant;
2. Encouragement of settlement;
3. Discouragement of inappropriate behaviour.

[7] The Court of Appeal has also cautioned that the overall objective in determining costs is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the circumstances, rather than an amount reflecting the actual costs paid by the successful litigant.

Background

[8] The parties are parents of one child, Collin. They were living in Ontario when they separated in 2010. Collin lived with his mother following separation. In the summer of 2011 Father moved to Buffalo, New York. Shortly after the move, the parties agreed in a written agreement that Collin would reside primarily with Father, and the child moved to live with him in Buffalo. Mother visited with Collin after this time, both in New York and in Ontario.

[9] On June 21, 2013, Father agreed that Collin would visit with Mother in Ontario for a week. Mother did not return Collin at the agreed upon time. Instead, she commenced an action for custody of the child and for child and spousal support in Ontario. Her lawyer advised Father that he could not see Collin until there was a court order or written agreement with respect to custody and access. On July 4, 2013, Mother obtained an ex parte order providing that Collin not be removed from Ontario without further court order.

When learning of Mother's actions, Father commenced an action for custody in New York, and brought a motion in Ontario seeking a termination of the non-removal order and an order pursuant to the Hague Convention providing that the child be returned to New York.

Analysis

[10] Father was entirely successful on his motion, and thus is presumptively entitled to an order for costs.

[11] Father has not demonstrated unreasonable litigation conduct that would disentitle him to costs. However, Mother argues that his failure to submit a Rule 18 offer to settle means that he is "disentitled" to costs at a full recovery level. Father's lawyer submits that some issues are not susceptible to offers to settle, and this is one of them— the court was either going to order that Collin remain in Ontario, or that he be returned to New York.

It has been held that the delivery of an offer to settle "should be a fundamental step in any family law case", and that a failure to make an offer to settle is in itself conduct that should reduce an award of costs. I have, in other cases, held that the failure to submit an offer to settle constituted unreasonable litigation behavior. Neither the Rules nor the caselaw, however, sets out an absolute prohibition of an award of full recovery costs to a party who has not submitted an offer to settle.

[12] I agree with Father that this was a one-issue case, in which compromise on that issue was not available. It does not follow that Father could not have submitted an offer to settle. For example, an offer could have been submitted which effected the child's return to New York, but which limited the costs payable if Mother consented prior to argument of the motion. Having said that, this is not a case in which I would reduce a costs award because of the failure of the successful litigant to make an offer to settle. In Hague cases, fast action is required to get the issue before a court and the successful party is often giving instructions to his lawyer from a distance, and these factors make preparation of an offer to be signed by the client more difficult than in the typical domestic case.

[13] I agree with Father's submissions that Mother acted unreasonably in that, in her initial affidavit provided to the court to obtain her ex parte order she did not make full and frank disclosure of the facts relevant to the issue.

[14] I also take into account that it was Mother's precipitous action which necessitated the motion brought by Father. At the time of the motion, the child had been living with him in New York State for almost two years. Although Mother in her material floated the proposition that the child's habitual residence was not in New York, by the time of argument of the motion she had abandoned that position. There was no credible argument that the child would be at risk of serious harm if returned to New York, where a custody hearing was already scheduled and where he was to receive legal representation. Mother had no independent evidence to support her assertion that the child did not wish to return to New York.

[15] Clearly the issue at stake was important. Although not complex legally, I acknowledge that Hague cases are not so common that some legal research will not be required for most family law practitioners conducting such a case. In this case, additional research was required to establish Father's right to custody under New York law, as there was no existing custody order.

[16] Mother's counsel submits that the time expended by Father's counsel was excessive, and that the attendance of two lawyers for the argument of the motion was unjustified. The bill of costs reveals that most of the work on the motion was done by junior counsel, a sensible step in managing costs. Given the issues involved, the research required, and the work necessary to answer the myriad allegations made by Mother, I find that the overall preparation time was reasonable. I do question why attendance of two counsel was required on the arguments of the motion, and will reduce the award of costs which I would otherwise make because of what I find to be an unnecessary attendance.

[17] Mother's counsel submits that Mother's relatively modest income of $37,440 annually should lead the court to reduce its award of costs, especially when it is taken into account that Father has a significantly greater income-- $169,637 last year. I agree with other courts which have held that a party's limited financial circumstances will not necessarily serve as a shield against a costs award if that party has behaved unreasonable, as did the applicant mother in this case. I decline to reduce an award of costs that would otherwise be appropriate because of Mother's financial circumstances.

[18] As the Court of Appeal observed in Boucher v. Public Accountants Council (Ontario), the determination of an award of costs should not simply be a mathematical exercise in which hours are multiplied by hourly rate. Family law cases following this view have stated that "the reasonable expectations of the losing party" should be a benchmark in setting costs.

[19] Taking all these factors into account, I find that the Applicant should pay to the Respondent costs fixed in an amount of $13,000 and payable within 30 days.

Released on: January 27, 2014

Signed: Justice E. B. Murray