Court File and Parties
Court File No.: 282/12 Date: 2014-09-09
Ontario Court of Justice
Re: Frank Atkinson – Applicant And: Tara Atkinson – Respondent
Before: Justice Roselyn Zisman
Counsel:
- Kevin G. Caspersz (on motion)
- Jodi Feldman (on costs) for the Applicant
- Douglas Quirt for the Respondent
Heard On: By written submissions August 8th and August 27th, 2014
Costs Endorsement
Introduction
[1] On July 21, 2014 I dismissed the Applicant's emergency motion for oral reasons. I indicated that any counsel seeking costs was requested to file written submissions within 30 days and response to be submitted 14 days thereafter. Both counsel have now filed their submissions.
Background
[2] In order to put the cost submissions into context, it is important to briefly review the history of this motion.
[3] The parties separated in May 2008 and have one child, Maya Mackenzie Atkinson born December 3, 2005. They entered into a separation agreement dated January 15, 2009 and an amended agreement dated February 20, 2009. The agreement provided for joint custody and an equal shared residential arrangement.
[4] The Applicant ("father") commenced a court application in June 2012 for an order specifying the holiday access as the holidays were not specifically dealt with in the separation agreement. The father also sought an order for counselling for the child or in the alternative a section 30 Children's Law Reform Act assessment and also an order restraining the Respondent ("mother") from attending at his home with a police enforcement clause. That action was settled by the order of August 30, 2012 that specified the holiday schedule, provided that the father be responsible for all the costs of counselling and be permitted to select the counsellor. The order also provided that the parties refrain from making disparaging comments about each other to the child, encourage the child to have a good relationship with both parents and not involve the child in adult issues, the parties' disputes and any litigation.
[5] On July 11, 2014, the father brought an ex parte urgent motion requesting that the separation agreement be set aside, that he be granted temporary sole custody and the mother's access be terminated until further court order, a section 30 assessment be commenced with the child remaining with the father pending the completion of the assessment and a restraining order preventing the mother coming within 100 metres of himself, his home and the child.
[6] It was submitted that the child was in the care of the father for his summer vacation and that he feared for the child's physical safety if she was returned to the mother. I refused to make an order that drastically changed the status quo without notice to the mother. I did make an order preventing both parties from removing the child from the jurisdiction as the father alleged that the mother was a flight risk and permitted him to keep the child for his scheduled summer vacation that was from July 11 to July 21, 2014. Counsel for the father was ordered to immediately serve the mother and a timetable was ordered for the filing of responding materials.
[7] On July 21, 2014, both parties with their respective counsel attended before me. The father's materials consisted of his 12 page affidavit but with 19 extensive exhibits and then he also filed an affidavit from the child's therapist. The mother filed a 22 page affidavit with 17 extensive exhibits. The materials consist of two volumes in the continuing record.
[8] After hearing submissions, I dismissed the motion on the basis that it did not meet the test of urgency in that there was no imminent risk of safety and harm to the child as most of the concerns expressed by the father had been known for months and years. I also held that I was not satisfied the mother was a flight risk. I acknowledged that there was an affidavit from the child's therapist but as she had never reported any concerns to the children's aid society I was not prepared to find there was an imminent risk if the child continued to reside with each parent in the shared parenting regime. I also expressed my concerns at the father's attempts to proceed on a without notice basis despite the fact that he had been having settlement discussions with mother's counsel and therefore should have advised counsel of the motion.
[9] Some temporary orders were made to attempt to protect the child from the volatile situation and the holiday schedule was confirmed. An order was made that the father was required to return the child on July 25th, both parties were not to discuss the litigation or make disparaging comments about each other, a non-removal order for both parents and a case conference was scheduled for September. A timetable was set for the serving and filing of written cost submissions.
[10] Subsequent to the court attendance, the father retained new counsel who prepared his response to the mother's claim for costs. The father's new counsel filed a Notice of Withdrawal of the father's application on the understanding that the mother's counsel was entitled to seek further costs as a result of the withdrawal. In order to deal with all of the costs arising out of the father's court proceedings, the court directed mother's counsel to advise the court if he was seeking any further costs and if so to serve and file his further costs submissions. The mother's counsel has now advised the court that no further costs are being sought as a result of the Notice of Withdrawal being filed.
Position of the Parties
[11] The mother seeks full recovery of her costs of $24,922.88 inclusive of applicable taxes and disbursements on the basis that she was the successful party and based on the fact the father demonstrated bad faith. Mother's counsel specifically submitted that:
a. the motion materials were extensive and the mother had to respond in kind in view of the serious allegations made against her and the father's position that her access be terminated;
b. the motion without notice was clearly brought with the intention of denying the mother an opportunity to provide meaningful responding materials and for the purpose of denying the mother summer vacation;
c. there was no immediate danger of the child's health and safety that would warrant a motion without notice evidenced by the fact the child's counsellor never reported any concerns about the child prior to the motion or reported any concerns to the children's aid society; the concerns raised by the father were the same concerns he had raised for months and years before;
d. there was no imminent threat of removal either as evidenced by the father's offer to settle that proposed the status quo continue, except that the mother's vacation time with the child would be eliminated, pending a section 30 assessment unless the child disclosed to her counselor that either party acted inappropriately in which case then the respective party's access would be terminated pending the outcome of the assessment;
e. the father insisted in his submissions to the court that the mother take two consecutive weeks of vacation time again showing he had no genuine concern about the child's safety with the mother;
f. the father should have canvassed if an early case conference date was available and should have engaged in settlement discussions to achieve a short term agreement pending a case conference;
g. counsel had been attempting to negotiate a summer holiday schedule when the father brought his emergency motion; letters showing such negotiation from July 3 to July 9th, 2014 were filed; but father's counsel brought a motion without notice on July 11th and then sent mother's counsel a copy of the court's endorsement on Friday July 11th but did not serve her with a copy of the motion materials until a clerk from mother's counsel's office contacted father's counsel on Monday July 14th to inquire about the materials. As a result a faxed copy of the materials without the exhibits was received on July 14th and a complete copy of all motion materials was not received until Tuesday July 15th. The endorsement required mother's materials to be served and filed by Thursday July 17th.
[12] It is the position of the father's new counsel that only partial indemnity of costs be ordered on the following basis:
a. it is conceded that the father's motion returnable on July 11th did not meet the test for urgency;
b. the father's counsel attempted to obtain an early case conference and was advised that there was no early case conference dates available in the Ontario Court of Justice and that the only process was to bring an urgent motion;
c. the father's former counsel was not aware that he should have contacted mother's counsel, with whom he was negotiating a summer vacation schedule, and arranged a motion on notice regardless of whether or not counsel was counsel of record and/or service on short notice; it is denied that this was a litigation strategy;
d. some urgency must have been accepted as temporary orders were made at both the court attendances on July 11th and July 21st, 2014 whereas the motion could have simply been dismissed; the return of the motion should be characterized as a return of the original motion rather than an urgent without notice matter as counsel was given more than the usual time to serve the motion and it was listed on the usual list for short motions;
e. a finding of bad faith should be sparingly used in cases involving children when a parent is only attempting to protect a child from a fear of harm;
f. there was no prejudice to the mother in the attempt by the father to proceed without notice to her as almost the same orders were made on July 11th as on the return of the motion;
g. the costs sought are suspect as the Bill of Costs was prepared after the dismissal of the motion as required by the Practice Direction in Central West Region that requires that counsel should attend a hearing with a cost outline or the presiding judge may decline to order costs;
h. the costs claimed by counsel are excessive in that father's counsel only submitted a bill for $2,760.00 for the motion;
i. it was only a result of the mother's unilateral move out of the jurisdiction that created a sense of urgency and concern was created that was diffused as a result of the father's motion when the mother then revealed her address. Accordingly, a costs award would only embolden the mother rather than promote further potential for resolution; and
j. the court should consider the fact that the father is now withdrawing his application with the full knowledge that he will be responsible for further costs as a result of his withdrawal.[1]
Settlement Attempts and Offer to Settle
[13] The father sent the mother's counsel an offer to settle the pending motion on July 18th for the motion returnable July 21st, 2014. The offer to settle was set up into parts A, B and C that were severable. Part A required the mother to agree to a section 30 assessment with one of three proposed assessors with the father paying the costs. Part B required the mother to forego her summer holiday access but the status quo of shared time would continue unless the child reported to her counselor inappropriate behaviour by either party in which case access would terminate pending the section 30 assessment. Part C dealt with cost consequences in that if the entire offer to settle was accepted then there would be no costs and the motion would be adjourned and if Part A or B was accepted then the motion would proceed with respect to the remaining issues.
[14] The mother did not accept any of the terms of the offer to settle and the result obtained by the father was clearly not as favourable to him as the offer to settle. In fact he did not receive any of the relief he requested. Therefore although the father's offer to settle was served in compliance with Family Law Rules 18(14) in view of the result of this motion, his offer to settle is not a relevant consideration with respect to costs.
[15] I am also mindful that counsel were in the midst of negotiations when this motion was brought without notice and that the father did not reveal this fact in his motion materials.
Applicable Legal Principles
General Principles
[16] Rule 24(1) of the Family Law Rules provides guidance on costs on a family law context. Rule 24 (1) sets out the basic assumption that a successful party is entitled to costs. This provision still permits a court broad discretion in determining if costs should be paid, by whom and in what amount.
[17] Rule 24 (11) provides a further list of factors a court should consider in dealing with costs:
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 behavior in the case;
c. the lawyer's rates
d. the time properly spent on the case, including conversations between the lawyer and the party, 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.
[18] In Serra v. Serra 2009 ONCA 395, [2009] O.J. No. 1905 at para. 8, the Ontario Court of Appeal confirmed that costs rules are designed to foster three important principles:
to partially indemnify successful litigants for the cost of litigation;
to encourage settlement; and
to discourage and sanction inappropriate behavior by litigants.
[19] I also agree with the comments by Justice Perkins in Biant v. Sagoo, [2001] O.J. No. 3693 (S.C.J.) that:
the preferable approach in family law cases is to have cost recovery generally approach full recovery, so long as the successful party has behaved reasonably and the costs claimed are proportional to the issues and the result.
[20] I am also mindful that 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 v. Public Council (Ontario) (2004), 2004 CarswellOnt 2521, [2004] O.J. No. 2634 (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.
Reasonable Behaviour and Offers to Settle
[21] Subsection (b) of Family Law Rule 24(11) relates to the reasonableness of each party's behavior in a case.
[22] In considering if a party acted reasonably, Family Law Rule 24 (5) directs the court to consider if a party served made an offer to settle and the reasonableness of any offer to settle.
[23] Rule 24 (5) provides that:
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.
Bad Faith
[24] Rule 24 (8) is also relevant as the mother's counsel has alleged bad faith by the father. It 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.
[25] "Bad faith" is not defined in subrule 24(8). The case law is clear that bad faith is something significantly more than unreasonable litigation behaviour. Justice C. Perkins in the leading case of [C.S. v. M.S.][2] explained that bad faith means the following:
In order to come within the meaning of bad faith in subrule 24(8), behaviour must be shown to be carried out with intent to inflict financial or emotional harm on the other party or other persons affected by the behaviour, to conceal information relevant to the issues or to deceive the other party or the court. A misguided but genuine intent to achieve the ostensible goal of the activity, without proof of intent to inflict harm, to conceal relevant information or to deceive, saves the activity from being found to be in bad faith. The requisite intent to harm, conceal or deceive does not have to be the person's sole or primary intent, but rather only a significant part of the person's intent. At some point, a party could be found to be acting in bad faith when their litigation conduct has run the costs up so high that they must be taken to know their behaviour is causing the other party major financial harm without justification.
[26] Although the father's behaviour was very close to warrant a finding that he acted in bad faith, I am not prepared to make that finding. As I believe he genuinely believed that he was doing the right thing, acting to protect the child's best interests and that he did not proceed with any ulterior motives. However, this finding should not be considered to condone the father's actions as I find that he misled the court distorted the facts and exaggerated his concerns about the mother. He also omitted many salient facts about the background of the litigation and the fact that counsel had been in negotiations for months before he brought his urgent motion.
Ability to Pay
[27] I must also consider clause 24 (11) (f) which requires the court to consider any other relevant factor, including the father's ability to pay costs. In [C.A.M. v. D.M.][3] Justice Rosenberg confirmed that the court should consider a parent's ability to pay but that the inability to costs should not be used as a shield against any liability especially when the parent has acted unreasonably.
Application of Legal Principles to the Facts
[28] In determining the amount of costs, I have considered the legal principles outlined above and the following factors as set out in Rule 24 (11) as follows:
a. The importance, complexity or difficulty of the issues:
The issues were extremely important to the parties especially for the mother as the father was attempting to change a status quo shared parenting arrangement that would have deprived the mother of any contact with the child pending an assessment. However, the issues were not complex or legally difficult.
b. The reasonableness or unreasonableness of each party's behavior in the case:
The mother acted reasonably both in her negotiations with the father prior to the commencement of the application and throughout this motion.
However, the father did not act reasonably for the following reasons:
(i) He orchestrated his summer vacation with the child so that he would have her in his physical custody when he served the mother with his application and then, attempted to proceed without notice on an urgent motion. The mother was prejudiced even though the court would not proceed with the motion without notice as the mother had to prepare responding materials in an extremely short time;
(ii) The father should have obtained an early case conference date by filing a form 14B as is the practice in this jurisdiction in the Ontario Court of Justice. I reject the father's submission that he was told by the trial coordinator that there is no process for obtaining an early case conference date. It is unclear exactly which trial coordinator the father's counsel spoke to as in this court location there is both a criminal and family trial coordinator for the Ontario Court of Justice and there are also Superior Court of Justice trial coordinators;
(iii) It is conceded by father's counsel that this was not an urgent motion; I do not accept father's counsel's submission that the court must have considered that there was some merit in the father's position as the court did not simply dismiss the motion but made some temporary orders. The court has a duty to try to deal with cases expeditiously and not waste court time and of course to act in ways to protect and shield a child from harm. The orders made were to ensure the child was returned to the mother, to prevent the parents from discussing the litigation with the child and on consent of the parties to prevent either parent from removing the child from the jurisdiction. Further, the unusually length of time for the return of the motion was necessitated as there was no family court judge sitting earlier; father's counsel makes various other statements that clearly reflect the lack of knowledge with the process for scheduling matters in the Ontario Court of Justice in this jurisdiction;
(iv) The father misled the court by not advising the court that counsel for the parties had been negotiating a summer vacation schedule for months instead he deposed that it was only after the mother was served with his application that she requested dates for summer holidays; and
(v) The father misled the court by alleging the mother was a flight risk and that she was moving out of the jurisdiction; even in his cost submissions he continues to distort the truth by alleging that it was only as a result of the mother moving out of the jurisdiction and her refusal to tell him where she was moving that created urgency and his concern about the child; whereas the truth is the father was aware the mother sold her house and was in the process of looking for alternate accommodations in this jurisdiction.
c. The lawyer's rates:
Mr. Quirt has 38 years of experience and his hourly rate of $467.50 per hour is reasonable. Ms. Quirt who also worked on this file has 4 years of experience and her hourly rate of $250 is reasonable. Both counsel were assisted by a legal clerk with 8 years of experience and her hourly rate of $140 is also reasonable. There is a minimal charge for a legal assistant at an hourly rate of $100 is also reasonable.
d. The time properly spent:
The father's counsel submits that the Bill of Costs is "suspect" as it was prepared after the dismissal of the father's motion and not in accordance with the Central West Practice Direction. However, the practice direction counsel refers to is for the Superior Court of Justice and not the Ontario Court of Justice. Further, as this motion proceeded on a busy list day counsel were requested to file written costs submissions as the court did not have the times to hear cost submissions on that day. It is further submitted that father's counsel's Bill of Costs is only $2,768 including HST on a partial indemnity rate of $250 per hour and if calculated at a full indemnity rate of $400 per hour it would be $8,631. Based on father's counsel's Bill of Costs he only spent in total 9.8 hours for interviews, preparation of the motion materials, review of the mother's materials and two court attendances. I find this a surprising small amount of time to spend in view of the volume of the materials filed.
I am not prepared to fault mother's counsel for spending considerably more time to respond to the motion in view of its importance to the mother. I have also considered that mother's counsel had to prepare responding materials in a very short timeframe and therefore it is understandable that more than one lawyer and legal staff were involved. It is quite a common practice for a legal clerk and junior counsel interview and prepared draft materials and then have those materials reviewed by senior counsel and this practice generally results in costs savings. However, in reviewing the Bill of Costs it is difficult to determine exactly what work was done by each counsel and the legal clerk as the same generic outline is referred to and there are no time dockets. I assume therefore that there was some duplication of services and that the Bill of Costs should be reduced. Further, both counsel attended court and the father should not have to absorb the cost for both counsel.
In reviewing the Bill of Costs I determined that there was a mathematical error as Mr. Quirt's time was actually 12.6 hours, not including the court attendance, whereas when the costs were calculated 20.20 hours were allocated to his time. This would reduce the costs by $3,553.
Accordingly, although I find that the mother is entitled to close to full recovery of her costs nevertheless the court still has an obligation to review the Bill of Costs to determine if it is reasonable.
e. The expenses properly paid and payable:
The usual disbursements are claimed. The amount requested of $441.30 is reasonable.
f. Any other relevant matter:
It is submitted by father's counsel that the amount of costs should not be so high as to "embolden" the mother and that the quantum sought would not benefit the child. Based on the financial statement the mother filed she is only earning $25,281 therefore the money she has spent to defend against the father's motion is money she would have otherwise had available to support the child. I do not know the father's income as he did not file a financial statement but I note that based on the separation agreement his income in 2009 was $90,000. There is no submission or evidentiary basis to find that the father does not have the ability to pay costs. Further, it is submitted on behalf of the father that the cost award should not be so high as to discourage future resolution. The philosophy underlying the Family Law Rules is to discourage litigation by means of affidavit warfare and to encourage a system of case conferencing that encourages parties to seek compromises and reasonable resolutions to family law issues. By choosing to proceed with an urgent motion, initially even without notice to the mother, by reciting past transgressions, by blaming and accusing the mother, by attempting to curtail all contact between the mother and child and by being distorting and exaggerating the background and facts of the case, the father set the tone for the litigation. Such behaviour must be sanctioned and discouraged.
[29] In considering all of these factors, I find that the mother is entitled to close to full recovery of all of her costs as she was the successful party and she acted reasonably. I have reduced the mother's counsel's Bill of Costs as indicated due to the duplication of services and the court has a duty to scrutinize a Bill of Costs to ensure that it is reasonable. I therefore find that the father should pay the mother her costs of $15,441.00 forthwith.
[30] As the motion did not deal with support issues these costs are not enforceable by the Family Responsibility Office. The father has now withdrawn his application and commenced a new application and consideration should be given to whether or not he should be permitted to proceed any further until this cost order is paid.
Order
The Applicant Frank Atkinson shall pay to the Respondent Tara Atkinson her costs fixed at $15,441.00 inclusive of disbursements and applicable taxes forthwith.
Counsel for the Respondent shall prepare this order and the approval of the Applicant as to form and content is hereby dispensed with.
Justice Roselyn Zisman
Date: September 9, 2014
[1] Subsequent to the father's costs submissions being filed, mother's counsel advised he was not seeking any further costs as a result of the withdrawal so this submission is no longer an issue.