Court File and Parties

Court File No.: Halton 324/11-01 Date: 2015-02-12 Ontario Court of Justice

Between:

Camille Louise Pierce Applicant

— AND —

Dale Allen Neville Respondent

Before: Justice Victoria Starr

Heard: By way of written submission

Costs decision released on: February 12, 2015

Counsel:

• Wendela M. Napier, for the Applicant
• Ryan Gibson, for the Respondent

STARR J.:

INTRODUCTION

[1] The applicant seeks costs of $15,000. The respondent concedes that the applicant is entitled to costs. The only issue is the amount to be awarded to the applicant. The amount the applicant seeks is 60% of the total costs claimed which are $24,000. The respondent submits that the appropriate amount to award to the applicant in costs is $4,000.

BACKGROUND

[2] On November 11, 2014, this court released its decision and reasons with respect to the applicant's motion to change an order for child support, including ongoing support, a contribution to post-secondary expenses and arrears of support. The respondent had claimed that he should pay a lesser amount of ongoing support and that he had overpaid support and did not owe any arrears. The applicant was largely successful in this motion in that she was granted most of the relief she sought, including the precise table amount of support she sought, nearly all of the post-secondary contribution she sought, and a considerable amount of arrears of support. Submissions with respect to costs of the motion were directed to be made in writing.

POSITIONS OF THE PARTIES

[3] The key elements of the applicant's argument are that the amount she seeks is appropriate because:

a. The applicant acted reasonably by making two offers to settle pursuant to Rule 18 which the respondent did not accept; and which, all elements taken as a whole, should be seen as favourable as the court's decision;

b. The respondent acted in bad faith or unreasonably by, among other things, failing to make an offer to settle, failing to make timely and appropriate disclosure, taking unreasonable positions on many of the issues, and by failing to accept either of the applicant's two offers to settle;

c. The respondent increased the costs of preparation for the final hearing by adopting a flawed analysis and method of calculation which followed an approach that was completely different to the calculations created by the applicant. If he had offered his critique of the applicant's materials instead, it would have been easier for the applicant and the court to follow his reasoning and to compare the contrasting positions; and

d. The respondent's position on the issues and litigation conduct increased the applicant's legal fees by unnecessarily prolonging and complicating all of the hearings.

[4] The respondent's response focused on four points:

a. The respondent's conduct did not amount to bad faith and was not unreasonable;

b. The time spent by the applicant's counsel of approximately 54 hours was excessive;

c. The amount the court ultimately awards in costs should be less than it might otherwise order because ultimately it is the Unifor Legal Services Plan that will benefit from a costs order in the amount that the applicant seeks, and not the applicant herself; and

d. The court should order costs commensurate with the respondent's reduced ability to pay.

COSTS - GENERAL PRINCIPLES

[5] Modern cost rules are designed to foster three fundamental purposes:

a) to indemnify successful litigants for the cost of litigation

b) to promote and encourage settlement; and

c) to control behaviour by discouraging frivolous suits of defenses that lack merit.

Fong v. Chan, [1999] O.J. No. 4600 (Ontario Court of Appeal).

[6] Rule 2 - Subrule 2(2) of the Family Law Rules (the rules) adds a fourth fundamental purpose for costs: to ensure that the primary objective of the rules is met – that cases are dealt with justly. This provision needs to be read in conjunction with rule 24 of the rules. Subrule 2(4) of the rules states that counsel have a positive obligation to help the court to promote the primary objective under the Family Law Rules. Clauses 2(3)(a) and (b) of the rules set out that dealing with a case justly includes ensuring that the procedure is fair to all parties and saving time and expense. Sambasivam v. Pulendrarajah, 2012 ONCJ 711.

RULE 18 (OFFERS TO SETTLE) ANALYSIS AS THE STARTING POINT

Why Start with Rule 18?

[7] I begin with an analysis under Rule 18 of the Family Law Rules rather than with Rule 24. I do so because two offers to settle were made by the applicant which she submits meet all of the criteria under Rule 18(14). If this is so she is presumptively entitled to costs for the period preceding service of her Rule 18 offer to settle and presumptively entitled to recover all of her costs from the date she served each offer onwards. While Rule 18 is clear about the amount the court is to fix costs at from the date the offer was served onwards, it offers no guidance whatsoever on how the court is to fix the amount of costs to be awarded for the preceding period. For that guidance the court must necessarily turn next to Rule 24.

COSTS CONSEQUENCES OF FAILURE TO ACCEPT OFFER

Rule 18(14) A party who makes an offer is, unless the court orders otherwise, entitled to costs to the date the offer was served and full recovery of costs from that date, if the following conditions are met:

1. If the offer relates to a motion, it is made at least one day before the motion date.

2. If the offer relates to a trial or the hearing of a step other than a motion, it is made at least seven days before the trial or hearing date.

3. The offer does not expire and is not withdrawn before the hearing starts.

4. The offer is not accepted.

5. The party who made the offer obtains an order that is as favourable as or more favourable than the offer.

[8] Rule 18(15) is clear that the burden of proving that the order is as favourable as or more favourable than the offer to settle is on the party who claims the benefit of subrule (14). This does not mean that the court cannot exercise its discretion and award an amount that is less than full recovery. The use of the phrase "unless the court orders otherwise" in Rule 18(14) clearly permits the court to do so. What it does mean however, is that the onus shifts to the party against whom the claim for costs is made to convince the court that this is an appropriate case for the court to exercise its discretion and order an amount that is less than full recovery. Rule 18 does not provide any guidance however as to how the court is to determine if this is an appropriate case to order less than full recovery of costs incurred after the date the offer was served. For such guidance the court must turn next to Rule 24.

[9] Rule 18 also contains no guidance with respect to how the court is to determine the amount to award for the costs incurred prior to service of an offer that meets all the requirements of Rule 18(14). All Rule 18 provides is the direction that the party who made such an offer is presumptively entitled to recover costs incurred in that period. Consequently, to determine the amount of costs to award for the period preceding service of the offer, the court must also next conduct an analysis under Rule 24.

Do the Applicant's Offers Comply with Rule 18?

[10] In this case the applicant's two offers met all of the criteria in Rule 18(14) except the last. That is, they were made months in advance of the hearing date, did not expire and were not withdrawn before the hearing started, and were not accepted by the respondent. The applicant did not however obtain a result an order that was as favourable as or more favourable than either of her two offers.

[11] The first offer, dated June 25, 2014, proposed a table amount of $751 monthly for eight months and $375.50 for four months of the year; $4,311 as a contribution to the 2014-2015 post-secondary expenses; and $8,000 as arrears.

[12] The second offer, dated September 26, 2014, proposed lower table amounts ($690 and $345.50), and a combined amount of arrears and s. 7 contribution of $12,000. It also proposed that the respondent pay $480 being ½ of the child's application fee to teacher's college.

[13] The court awarded table amounts of support that were the same as in the applicant's first offer and higher than in the second offer.

[14] The s. 7 contribution ordered by the court of $6,663.98 was higher than as set out in the first offer ($4,311) but the arrears ordered by the court ($4,892.42) were significantly lower than the $8,000 in arrears in the first offer. The total value of the offer regarding arrears and section 7 contribution, if one combines the two was $12,311.

[15] The second offer combined s.7 contributions with the arrears. The total combined offer was $12,000 plus $480 for the application fee. The applicant's claim for the respondent to pay $480 of the teacher's college application fee was dismissed by the court.

[16] The applicant submits that all elements taken as a whole, both of the applicant's offers should be seen as being as favourable as the court's decision and as a result, she is entitled to recover her costs from June 25, 2013 onwards on a substantial indemnity basis. I agree with the applicant that the court should compare all of the elements of an offer taken as a whole with all of the elements of the order taken as a whole. I do not agree that both of the applicant's offers were as favourable as the court's decision, even when taken as a whole. By way of illustration the arrears combined with the s. 7 amount owing awarded by the court total $11,556.40. This amount is slightly less than the combined totals of s.7 and arrears proposed by the applicant in each of her offers ($12,311 and $12,000 not including ½ of the application fee).

[17] In cases such as this one, where it is easy to compare the value of the whole of what was offered with the value of the whole of what was ordered, the court must be as precise in its comparison as possible. To do otherwise would render the distinction between the cost consequences of offers to settle that comply with rule 18 and those of offers to settle being considered as part of the analysis under rule 24. In other words, the fact that an offer comes very close, as both do here, with the ultimate decision, is not enough to attract the presumption in rule 18 that the party who made the offer is entitled to costs on a full recovery basis from the date the offer was made and costs generally for the period preceding the date the offer was. To attract those consequences the party who made the offer must obtain an order that is as favourable as or more favourable than the offer. This is not the case here.

[18] Here the value of each of the two offers fall just short of the ultimate result and as a consequence, it cannot be said that all of the conditions in rule 18(14) have been met and that as a consequence of the respondent's failure to accept either of the applicant's two offers, the applicant is not presumptively entitled to either full recovery of her costs from the date of either offer onwards or partial recovery for the period preceding either offer.

COSTS UNDER RULE 24

The Rule

[19] Having determined that the Rule 18 conditions have not been met, I now consider Rule 24 of the Family Law Rules.

[20] In reaching my decision I have considered all of the factors set out in subrule 24(11) of the rules which reads as follows:

Rule 24(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.

Subrule 24(5) provides criteria for determining the reasonableness of a party's behaviour in a case (a factor in clause 24(11)(b) above). It reads as follows:

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.

Family law litigants are responsible for and accountable for the positions they take in the litigation: Heuss v. Surkos, 2004 ONCJ 141.

[21] Subrule 2(4) imposes a duty on parties and their lawyers to promote the primary objective of the rules to deal with cases justly (subrule 2(2)). This includes taking appropriate steps to save time and expense (subrule 2(3)). Offers to settle play an important role in saving time and expense by promoting settlements, focusing parties and often narrowing issues in dispute (See Klinkhammer v. Dolan and Tulk, 2009 ONCJ 774, [2009] O.J. No. 6370 (OCJ)). The failure to serve an offer to settle will be an adverse factor when assessing costs (see Laing v. Mahmoud, 2011 ONSC 6737).

The Reasonableness of the Applicant's Offers to Settle

[22] As I have noted, in this case, the applicant made two offers to settle that came very close to the ultimate result, the first of which having been made early on in the case. These are positive factors in my assessment of the appropriate amount to award in costs as they leave little doubt about the applicant's reasonableness. This coupled with the extremely close proximity between the value of what she offered in each instance and the value of the result point to an award of costs at the high end, closer to full recovery.

The Respondent's Behaviour

Failure to Make an Offer to Settle

[23] The failure to make an offer to settle is unreasonable behaviour. Subrule 2(4) imposes a duty on parties and their lawyers to promote the primary objective of the rules to deal with cases justly (Rule 2(2)). This includes taking appropriate steps to save time and expense (Rule 2(3)). Offers to settle play an important role in saving time and expense by promoting settlements, focusing parties and often narrowing issues in dispute. See: Laing v. Mahmoud, 2011 ONSC 6737. The respondent's failure to serve an offer to settle is an adverse factor in my assessment of the amount of costs to award.

[24] The respondent's failure in this case to make any offer to settle and his failure to accept either of the applicant's reasonable offers to settle, when combined with the fact that the ultimate result was very close to the terms of settlement proposed by the applicant at a very early stage, leads me towards the conclusion that this is an appropriate case to exercise my discretion to fix the amount of costs at the high end rather than at the lower end.

Bad Faith or Unreasonable Conduct

[25] The applicant gave a number of examples of conduct engaged in by the respondent which she characterized as unreasonable and amounting to bad faith. The clearest of the examples given are as follows:

(1) He refused to produce proof of his income as required by the Child Support Guidelines and as requested by the applicant's counsel in many letters between January 6, 2013 to August 28, 2013. When he did produce limited income disclosure (a 2011 Notice of Assessment), he severely redacted the document and deleted most of the relevant information.

(2) Although he was served with the Motion to Change documents on October 27, 2013, he did not communicate or file responding materials within the required 30 day period. In fact, no communication was received until a letter from his counsel was received on January 6, 2014, in which an extension of time was requested to file his materials. By this time, the applicant had been put to the expense of 14B Motion for a disclosure order and summary judgment. The disclosure order was granted on December 23, 2013. Neither of these steps should have been necessary.

(3) During the proceedings he filed materials late and often did not have all relevant information available prior to or even at the conferences. As a result disclosure orders were required.

(4) He failed to comply with the disclosure order dated June 27, 2014, in that he did not produce the letter from his doctor until August 15, 2014, when it was required by July 27, 2014, and he never did produce the letter from his employer.

(5) The respondent was rude and dismissive of the applicant's requests as well as of his obligations under the law.

(6) He took unreasonable positions which unnecessarily prolonged and complicated all of the hearings, for example:

a. He demanded to pay the support directly to the child and or the university despite the fact that he had defaulted on a number of his obligations under the prior order;

b. He requested reimbursement for hockey expenses despite not having given advance notice of the expense and he offered no evidence that they were extraordinary;

c. Despite having consented to an order on June 27, 2014 to continue the general principles of the prior order as to the method of determining the table amounts of support (this had been intended to narrow the issues), at the hearing he argued to reduce his obligation during the school months, without any evidence in support of why this should happen;

d. He intentionally reduced his income by failing to take assigned shifts at work. As a result income was imputed to him;

e. He argued that arrears should be calculated using the income for prior years rather than the income for the year in question.

[26] The respondent did not deny the examples given by the applicant of his conduct. Rather, he took issue with the applicant's characterization of his conduct. He submitted that his position was always clear that he wished to pay the proper amount of support and that the issues had to be litigated because the parties were so far apart due to the fact that they were using very different calculations. With reference to the redacted Notice of Assessment, he submitted that this is not relevant to costs as: this was done by the respondent while he was self-represented; and, this was done prior to the commencement of the motion to change.

[27] I do not agree with the respondent on the latter point. How one behaves prior to the commencement of proceedings is indeed relevant, particularly when the issue is child support and the behaviour complained of is the withholding of required disclosure. I am similarly unsympathetic to the respondent's attempt to excuse his behaviour by attributing it to a period when he did not have a lawyer. He appears to be saying that he should be excused because he did not know any better.

[28] Not having a lawyer, for a litigant who earns the income that the respondent does ($75,683) or that the court has declared he is capable of earning ($83,687 imputed income), is a choice. It is a choice he is free to make but with that choice comes the responsibility of making sure that you know your rights and obligations, the rules of court that will govern the process and that must be followed, and the applicable law. The respondent cannot use his own litigation choices as a shield to insulate him from having a significant cost order made against him. To allow him to do so would be contrary to public policy and unfair and unjust to both the applicant and the parties' daughter as it is they who would, in effect, be subsidizing his choices. It is they who go without so that counsel can be funded to pursue the available remedies for nondisclosure.

Does the Respondent's Conduct Amount to Bad Faith?

[29] Turning to the question of whether the respondent has acted in bad faith by engaging in the behaviours that the applicant complains of. If a party is found to have acted in bad faith, costs are to be decided on a full recovery basis payable immediately, (subrule 24(8) of the Family Law Rules).

[30] The respondent relies upon the case of Biddle v. Biddle, a decision of Blishon, J. In that case, Justice Blishon stated the following at paragraphs 14 – 16:

[14] As noted in Leonardo et. al. v. Meloche et. al., [2003] O.J. No. 1969 (S.C.J.), conduct that is intended to deceive or mislead can establish bad faith. In Hendly v. Martins, [2001] O.J. No. 1098 (S.C.J.), Justice Campbell relies on Black's Law Dictionary, 6th ed. (St. Paul Minnesota: West Publishing Company, 1990) in stating:

Bad faith is not simply bad judgment or negligence but rather it implies the conscious doing of a wrong because of dishonest purpose or moral obliquity... it contemplates a state of mind affirmatively operating with furtive design or ill will.

[15] Bad faith can be established by the intentional failure to fulfill an agreement in order to achieve an ulterior motive or, an intentional breach of court order with a view to achieving another purpose. See Eriksoll v. Eriksoll, [2000] O.J. No. 1569 (S.C.J.) and Hullt v. Hullt, [2001] O.J. No. 5111 (S.C.J.).

[16] In Piskor v. Piskor, [2004] O.J. No. 796, the Court found that Mr. Piskor's failure to provide full and timely disclosure and to abide by the disclosure orders made by the Court, along with his unreasonable and unilateral refusal to make support payments pending the hearing of his application, in my view, amount to bad faith. Therefore, Ms. Piskor is entitled to full recovery costs pursuant to R. 24(8).

In that case, Mr. Piskor blatantly ignored support orders. In addition, he intentionally refused to make disclosure of the majority of financial documents including company financial statements, personal and corporate tax returns, over many months and in the face of four disclosure orders. His conduct was blatant, extreme and there was ample evidence of bad faith.

[31] In Biddle v. Biddle however, the court found that although Mr. Biddle had not provided the full and timely disclosure ordered, he had produced significant financial disclosure and had an explanation for the delay. Further, it was still relatively early on in the process and at the stage where the matter was before Justice Blishon, there was insufficient evidence to find that he intentionally misled or deceived the applicant or the court for a dishonest purpose.

[32] In this case, even if the respondent had engaged in all of the behaviours the applicant asserts that he has, I cannot find that his conduct goes beyond bad judgment. I cannot find that it implies the conscious doing of a wrong because of dishonest purpose, furtive design, moral obliquity, or ill will.

[33] The respondent, as I have noted, does not dispute that he engaged in the behaviours the applicant has complained of and which I have enumerated above. I find that the respondent acted unreasonably by, among other things, failing to make an offer to settle, failing to make timely and appropriate disclosure, taking unreasonable positions on many of the issues, and by failing to either accept either of the applicant's two offers to settle or make an offer to settle of his own.

[34] The respondent's actions and position on the issues and his litigation conduct increased the applicant's legal fees by unnecessarily prolonging and complicating the various court attendances. Nowhere was this more apparent to the court than at the final hearing where the respondent, prolonged the hearing and unnecessarily complicated matters by adopting a flawed analysis and method of calculation which followed an approach that was completely different to the calculations created by the applicant. If he had offered his critique of the applicant's materials instead, not only would the time spent by the applicant's counsel preparing for the hearing likely have been reduced but so too would this have been true in terms of the time spent by all at the hearing and by the court afterwards as it would have been easier for the applicant and the court to follow his reasoning and to compare the contrasting positions.

The Importance, Complexity or Difficulty of the Issues

[35] The issues in this case while important, were not necessarily complex or difficult. I accept the respondent's position that the parties were so far apart in their positions that the issues needed to be litigated. This does not mean however that the litigation needed to be so time consuming and thus costly for the applicant. It is the respondent's choices about how to conduct himself in the litigation that made the issues more complex and the case more difficult both of which ultimately drove up the cost of the litigation for the applicant. Choices have consequences and the respondent must be held accountable for his choices. A substantial cost order would accomplish this.

Time Spent and Lawyer's Rate

Hourly Rate and the Unifor Prepaid Legal Services Agreement

[36] The applicant's counsel was retained as a result of the applicant's eligibility for legal services under the Unifor Prepaid Legal Services Agreement. Under this agreement, the fees to the client are the greater of costs recovered or the fees in the agreement, which involve 12 hours of prepaid time and a billing rate of $110.00 per hour on all time in excess of 12 hours.

[37] The applicant referred the court to several cases which I find support the principle that the Unifor Prepaid Legal Services Agreement ("Unifor Agreement") should not be construed as setting an upper limit on costs otherwise payable to a successful party (See: Zeleny v. Zeleny, 69 O.R.(3rd) 287; Childs v. Childs, an unreported decision of Justice Corbett dated July 7, 2005; Fallis v. Garcia, an unreported decision of Justice Mossip, dated July 28, 2008; Friday v. Friday, 2013 ONSC 6179). The respondent does not take issue with this principle.

[38] Given the case law and the respondent's concession, I find therefore that the Unifor Agreement does not set an upper limit on costs otherwise payable to the applicant.

Hourly Rate

[39] The applicant's counsel has in excess of 30 years of experience and submitted that an hourly rate of $400 was appropriate. The applicant relied on Friday v. Friday supra for the proposition that where counsel has in excess of 30 years of experience, as in this case, an hourly rate of up to $400 may be permitted. The respondent does not take issue with the use of $400 as the appropriate hourly rate for the applicant's counsel. I find the hourly rate of $400 reasonable in these circumstances.

Time Spent

[40] With respect to the amount of time spent on the case, the applicant submits that the time spent by her counsel in preparing and advancing her case (54 hours) was reasonable and necessary, and in keeping with the level of difficulty involved in the issues and as a result of the respondent's conduct.

[41] The main thrust of the respondent submissions on this point was that 54 hours was excessive. As a point of reference he submitted and referred to his counsel's dockets which showed that he spent 43.25 hours. He submitted that it would be anticipated that a counsel with more than 30 years' experience such as the applicant's counsel, would spend less time on a motion to change than a counsel such as his with only four years experience.

[42] I have reviewed the applicant's costs outline, the dockets of counsel for the respondent, as well as several other factors relevant to the determination of whether the amount of time the applicant's counsel spent on the case was proper. There are several factors that have led me to conclude that it was.

[43] First, the time spent includes more than the time spent preparing for and attending at the final hearing. It includes the time spent at a number of other court attendances because at almost every one of the other steps the case management judge reserved the issue of costs. A total of 54 hours spent on the entire motion to change process let alone one where the respondent has acted unreasonably appears reasonable.

[44] Second, I agree with the applicant's submission that the time she had to spend on the case was increased as a result of the respondent's unreasonable conduct. For example, I agree with the applicant's submission that the respondent's method of analyzing and calculating the support obligations resulted in her having to spend unnecessary additional time preparing for the hearing and that it prolonged the hearing somewhat. As I have already noted, the court's experience was similar in that it had to devote increased and unnecessary time.

[45] Third, from my comparison of the applicant's cost outline with the dockets the respondent presented for the period of December 4, 2013 and December 2, 2014, I notice some significant differences, any one of which accounts for why the amount of time spent by counsel for the applicant is higher rather than lower than the time spent by counsel for the respondent, despite the significant gap in their experience levels. The most significant and telling are these:

a. The respondent was self-represented initially. As such, the time for which the applicant seeks costs includes time spent prior to the respondent retaining counsel. These costs relate to time spent communicating with the respondent and time spent preparing for an uncontested trial (2.2 hours) that did not go forward due to the fact that the respondent finally retained counsel and defended the proceedings;

b. The applicant's costs outlines includes travel time (about $760), time spent on preparing cost submissions ($2,200), and disbursements ($1,086.57). The respondent's dockets show no amount for any of these things. (the amounts I have shown do not include HST);

c. The lion's share of the respondent's dockets appear to relate to time spent on communications (including correspondence and meetings with client) between him and the applicant's counsel, his client and the court, as well as time spent on scheduling and rescheduling and attending at the courthouse himself to file documents and arrange to have orders formalized. While time was spent by the applicant's counsel on communications, the amount of time overall appears to be much less;

d. Far less time than the applicant was spent by counsel for the respondent on such things as preparing court documents and preparing for meaningful court attendances. To give some examples:

i. For the May 2013 case conference the respondent's counsel appears to have spent ½ an hour preparing for it while the applicant's counsel spent 5.6 hours doing so;

ii. The applicant's cost outline indicates she spent at least 7.8 hours preparing for the June 27, 2015 settlement conference. This time includes preparing an offer to settle but does not include the actual time spent at court. By contrast, the respondent's dockets show no time spent preparing for the settlement conference except 1.75 hours spent on support calculations (which I have assumed was in preparation for the settlement conference, although the docket does not say so);

e. The applicant's cost outline includes the time she spent preparing costs submissions (5.5 hours). The respondent's dockets show no time for this.

[46] Based on the foregoing comparison, it does not appear to me that the amount of time spent by the applicant's counsel was high. All things considered, it appears relatively reasonable and reflective of the time she likely saved as a result of her 30 years of experience. It also appears that the time spent on the case by the respondent's counsel was low particularly when it came to preparing for court attendances. Had he spent more time preparing for the various court attendances that the applicant prepared for (i.e. settlement conference and case conference), and had he spent more time than he did on the calculations he relied upon at the hearing, the amount of time he spent would have been much higher than it was, and, more importantly, perhaps the parties would not have been so far apart and the case would have been resolved well before the final hearing.

[47] For these reasons I find the time spent by the applicant's counsel completely reasonable and in line with the amount of time one would expect a counsel with more than 30 years of experience to spend on a motion to change such as this.

Travel Time

[48] The applicant's cost outline includes time spent travelling. D.C. Price J., in the case of Friday v. Friday supra, reviewed the jurisprudence with respect to travel time and concluded as follows:

60 As for the appropriate hourly rate, courts have not been unanimous as to whether counsel's hourly rates should be allowed, denied, or reduced, for travel time. Spies J., in Rosen v. Slovan-Rosen, (2010) held that travel time should not be included in recoverable costs on a partial indemnity scale. 37 Zisman J., in the Ontario Court, came to the same conclusion in Wilson v. Marchand, (2007). While other judges have allowed costs for travel time, they have differed as to whether counsel's hourly rates should be reduced for such time. Their difference of opinion on this issue is evident in Gatta v. The Corporation of the City of St. Catharines, (2010). In that case, Taliano J. stated:

Counsel for the plaintiff takes the position that travel time should not be permitted. Counsel for the defendant relies on Mallory v. Mallory, [1998] O.J. No 41 where my learned colleague, Quinn J., held that travel time should not only be permitted but should be allowed at counsel's full chargeable hourly rate without discount since counsel while travelling, "is representing his/her client to the exclusion of all other clients and their needs." He went on to conclude that to discount counsel's hourly rate would ignore the harsh fiscal reality of the business of law. My view is that, although travel time which is necessary to the performance of counsel's duties should be compensable, the rate of compensation should be reduced to reflect the fact that the litigator's skills are not generally engaged during travel time. That being the case, a lower rate of compensation is more appropriate. In this case, I would allow travel time at 50% of the substantial indemnity rate and I would therefore reduce the full indemnity bill by $4,219. 39

61 The weight of authority favours a reduction of counsel's hourly rate for travel time by 50%, at least where costs are awarded on a partial indemnity scale. Orkin, in The Law of Costs, states:

Where a solicitor's retainer requires him to travel on behalf of the client he is not entitled to be paid at the same rate for traveling time as he is for solicitor's work.... Full rates charged for traveling time have been reduced on assessment, either by a reduction in the amount of time to be allowed or by allowing the full amount of time recorded but reducing the rate substantially below the solicitor's normal billing rates..."

65 In my view, this is the correct approach. Even apart from cases in which counsel charges a lower hourly rate by reason of a special fee arrangement, such as the CAW Retainer and Fee Agreement, counsel are generally not permitted to recover fees from their clients for travel time on the same hourly rate that they charge for preparation or attendance. In order to maintain proportionality between what a lawyer could charge a client for his or her services, and what the client should recover from the unsuccessful litigant, Ms. Friday's recovery for travel time should be reduced to $200 per hour, being half of Ms. Napier's full hourly rate on a substantial indemnity scale.)

[49] In this case counsel for the applicant's time for travel to and from court has been reduced by 50%. That is, the rate charged is at $200 per hour rather than her counsel's full hourly rate of $400. This approach is consistent with the jurisprudence and consistent with D.C. Price J.'s finding in Friday that $200 per hour is an appropriate rate for Ms. W. Napier's travel time. I see no reason to reduce it further.

Expenses Properly Paid or Payable and HST

[50] Under the Unifor agreement, the applicant is responsible for all disbursements and HST. It cannot be said that the applicant will obtain a windfall as a result of any amount being awarded on account of disbursements and HST.

[51] The disbursements that the applicant seeks to recover include the usual items: service and filing fees, photocopies, transaction levy, facsimile transmissions, courier charges, mileage and postage. There does not appear to be anything excessive in the amounts charged nor did the respondent's counsel take issue with the disbursements. I find the applicant is entitled to full recovery of the $1,227.82 paid in disbursements including HST.

ANY OTHER RELEVANT MATTER

Does it Matter that it is Unifor who will Benefit from a $15,000 Cost Award?

[52] As I have noted already, under this Unifor agreement, the fees to the client are the greater of costs recovered or the fees in the agreement, which involve 12 hours of prepaid time and a billing rate of $110.00 per hour on all time in excess of 12 hours. In addition, it is submitted that by the applicant that all fees recovered in excess of what the client has paid or is to pay are retained by the Unifor Plan and applied to its operating costs, in a manner similar to Legal Aid. The respondent submits that as a result, it is the Unifor Plan that will benefit from a cost award in excess of what the applicant has or will actually pay and not the applicant herself. He further submits that this is a "relevant matter" under Rule 24(11)(f) in determining the quantum of costs and ought to, in this case, result in a reduced cost award.

[53] I agree with the respondent that the benefit to the Unifor Plan is a relevant consideration. I do not agree that this ought to result in a reduction in the amount I award. To do so would fail to recognize the very important role plans such as the Unifor Plan play in facilitating an individual's access to justice. Plans such as this and the Ontario Legal Aid Plan facilitate access to justice by either subsidizing the cost of litigation completely or by doing so partially. Their role is particularly important in cases such as this one where the party seeking justice is faced with an opposing party whose litigation strategy and choices drive those costs well beyond affordability and the value or benefit to be obtained. Without such a plan to help shoulder the burden or cost of unnecessarily expensive proceedings such as in this case, many litigants seeking justice would either never attempt to seek justice, or, eventually settle for far less than is just in an attempt to mitigate their losses.

[54] Two examples serve to illustrate how their role likely assisted the applicant in this case access justice:

a. Here the total value of justice for the applicant or the total value gained by the applicant was about $11,556.40. Her estimate of the value to be gained, an estimate made fairly early on in the litigation as is apparent form her first offer to settle, was not that far off from the actual result – about $12,311. The applicant could reasonably be expected therefor to pay up to $12,311 in legal costs but no more because beyond that the value of what she stood to gain for the support of the parties' daughter would be exceeded by the cost to her of obtaining it. If she had not had access to subsidized funding through the Unifor Plan and had she known at the outset that the cost of obtaining $11,556.40 or $12,311 would be $24,325.02 (the total fees claimed), she would likely have forgone trying to obtain a just result so she could make sure that she had sufficient funds to support the parties' daughter herself;

b. In this case, as in so many others of its ilk, the applicant could not have known or anticipated at the outset that the respondent would make litigation choices and would adopt a litigation strategy that would result in fees that double the amount at stake in legal fees. Had she not had the financial support of the Unifor Plan, she might very well have done what many litigants do at the point where the cost outweighs the benefit to be gained, cut her losses by settling for far less in child support than a court would award and the child deserves.

[55] In both of these examples but for the Unifor Plan, the applicant could be expected to have walked away thereby in effect, being denied access to justice.

[56] To deny or to significantly reduce an award of costs purely on the basis that it is the Unifor Plan that will gain from the award rather than the applicant, could threaten the sustainability of the plan or at the very least, limit the funds available to help individuals access justice, and thus, the number of individuals who are able to access justice because of their access to such subsidy. Such a result, a result that undermines access to justice, must be avoided as being contrary to public policy.

[57] While it is important to society to have such plans continue to be available by allowing them to apply any excess in costs awarded to their operating budgets, it is equally important to avoid the inoculation these plans offer a litigant by keeping the cost of litigation artificially low for the litigant. The last thing the justice system needs is litigants with a license to litigate with impunity. By this I mean take unreasonable positions or refuse to settle because it costs them nothing or very little to carry on with the litigation. To allow this and then reward such behaviour by awarding costs which inure to the benefit of the inoculator (the plan) would run afoul of the other objectives of a cost award - to promote and encourage settlement and to control behaviour by discouraging frivolous suits of defenses that lack merit.

[58] In this case there is no indication whatsoever that awarding a level of costs to the benefit of Unifor Plan, who along with the applicant shouldered the costs of the litigation, would contravene these equally important objectives. There is no claim by the respondent that the applicant's conduct was unreasonable or that anything she did or did not do increased the cost of the litigation unnecessarily. Further, both of her offers to settle proposed terms of settlement that were well within the range of possible outcomes. Had these offers been accepted by the respondent, the cost of the litigation to both parties and to the plan would have been significantly less.

[59] Finally, the applicant significantly reduced the amount of costs she seeks. She submitted that part of this reduction is in recognition of the fact that it is the Unifor plan that will gain from an award of costs in excess of what the applicant paid or will pay and not the applicant herself.

[60] For these reasons I reject the respondent's argument that the amount of costs awarded should be reduced beyond what it has already been by the applicant herself on account of the benefit to the Unifor Plan.

Ability to Pay

[61] Another factor that the respondent asks the court can to consider as a "relevant matter" under Rule 24(11)(f) is the respondent's ability to pay. In support of this proposition that this is a relevant factor, the respondent referred the court to the case of Lawder-Windsor v. Windsor, 2013 ONSC 7365. I agree that in some cases ability to pay is an important factor.

[62] In this case, the respondent submitted that, where the respondent has been ordered to pay support based on an imputed income, is ordered to pay $4,832.35 in arrears, and is ordered to pay a further $6,663.98 in six installments towards the child's 2014/2015 child support expenses, and that on an actual annual income of $76,640.00 (rather than the $83,687 the court imputed him with), he simply cannot afford to pay an additional costs order in the amount of $15,000.00.

[63] This latter point is not particularly compelling. The respondent was imputed with an income greater than his actual income on the basis that he was underemployed as he was not working all of the hours available to him to work. Consequently, the respondent can increase his ability to pay both the support amounts and the costs awarded against him by working more hours. Again, I note that the respondent obtains a significant reduction in the costs to be awarded by virtue of the applicant's self-imposed reduction in the amount she is seeking. This reduction, in my view, adequately addresses any limited ability to pay that he may have.

[64] Finally, I accept the applicant's submission that any difficulty the respondent has meeting the payment can be addressed by allowing him to pay in instalments. The fact that it is the Unifor Plan that will benefit from any excess in the cost award I make and the fact that they have the ability to relieve the applicant of the burden of repaying them her portion until after or when costs are recovered is a relevant consideration in setting a time frame for the payment of costs by the respondent. The order I have made below recognizes this, accommodates the current financial pressures on the respondent, as well as the need to give his payment of child support priority. It does this by allowing him to pay the costs in installments and by setting the start date for those payments in June 2015, two months after he has made his final of six installment payments on account of the $6,663.98 he owes for the child's 2014/2015 child support expenses.

GENERAL DISCRETION TO AWARD WHAT IS FAIR AND REASONABLE

The Respondent's Reasonable Expectations

[65] My analysis of costs concludes with a consideration of what amount of costs is "fair and reasonable" in the circumstances for the respondent, the unsuccessful party in these proceedings, to pay (see Farjad-Tehrani v. Karimpour, 2009 CarswellOnt 2186 (S.C.J.) at para. 32, aff'd 2010 ONCA 326, 2010 O.N.C.A. 326 at para. 4).

[66] As D.C. Price J. noted in the case of Vetro v. Vetro, 2011 CarswellOnt 14094, 2011(Ont. S.C.), to do this I must take into account the reasonable expectation of the parties concerning the amount of costs. I must in effect:

step back and examine the overall award with a view to determining whether it is 'fair and reasonable' for the kind of matter involved. In making this determination, I take into account the reasonable expectation of the parties concerning the amount of costs.

[67] Given his cost generating and unreasonable conduct, the values of the offers to settle, the experience level of the opposing counsel, and the fact that the costs for several of the steps in the proceeding had been reserved, I find that the respondent could reasonably have expected to pay a substantial cost award in the event that he was not successful and particularly, in the event that he was unsuccessful on most of the issues as he was in this case.

[68] In considering just how much he could reasonably expect to pay I have considered several factors. First, the total value of the amount of the applicant's best offer, from her perspective, was $12,311. It was made early on and as I have already found, fell within the range of possible outcomes. As such, it can be said that this is the value of what she could reasonably have expected to gain for the support of the parties' daughter through litigation. As it turns out, she was not that far off as the value of the ultimate result, not including ongoing support, was $11,556.40. Based on this, in my view, the respondent, like any respondent prudent enough to do a cost benefit analysis ought to have expected that the applicant would spend up to $12,311 in legal fees to obtain an equal result. That the costs could ultimately end up being around $12,311, ought to have been abundantly clear to the respondent as it is he and he alone who controlled the behaviours that in this case, drove up the legal fees unnecessarily.

[69] Second, the respondent's own legal fees, on a full recovery basis, were in excess of $8,000. That $8,000 did not result from added time due to unreasonable conduct on the part of the applicant. It appears to me that the amount of time his counsel spent was proportionate to what a party could expect his or her lawyer to expend on a motion to change that is not unnecessarily time consuming.

[70] Third, the respondent also knew or ought to have known that the applicant's counsel had over 30 years' of experience and thus that her hourly rate would be significantly higher than his counsel's with four years of experience and an hourly rate of $175. It stands to reason that he would expect her hourly rate to be at least double that of his counsel's. In addition, there is case law available and I have referred to at least one of those cases, Friday, where the judge found that an hourly rate of $400 per hour was appropriate for a counsel with over 30 years of experience. The counsel referred to in that case is one and the same as the applicant's counsel, W. Napier, in this case. The respondent also could have gleaned form that case law that the existence of Unifor Agreement would not result in the court setting an upper limit on the hourly rate that would be used to calculate his cost obligation if he lost. So, assuming that the amount of time his lawyer spent was more in line with the amount of time it ought to have taken to conduct this particular motion to change from start to finish (43.25 hours) and multiplying that by $400 per hour, it is reasonable to conclude that the respondent could have reasonably expected that the starting point for the court, if it were fixing costs in a case where time was no unreasonable and cost generating conduct, would be $17,300. Given that this case did involve cost generating and unreasonable conduct on his part, he ought to have expected the starting point to be much higher than $17,300; which as it turns out in this case, was $24,325.02.

[71] For these reasons I find that the respondent could reasonably have expected to pay costs, if unsuccessful, somewhere in the range of $12,311 and $24,325.02.

The Need to Control Behaviour and Promote Settlement

[72] I have also considered the fact that the cost award I make must do more than address the objective of indemnification. It must also promote settlement and control unreasonable litigation behaviour. An award of greater than $12,311 will send a message to this and other individuals involved in or contemplating litigation that reasonable settlement proposals are to be given serious consideration and accepted, or at the very least, countered.

[73] An award of costs that is closer to the total costs of the applicant ($24,325.02) will also send a signal to this respondent and to other litigants that there is a direct correlation between how one behaves in litigation and the amount of costs one may be ordered to pay. That is, the worse the behaviour, the higher the award. By awarding a significant award of costs against the respondent in this case, the court hopes to give him and other litigants incentive to think twice, the next time litigation tactics such as failing to make an offer, failing to accept a reasonable offer, failing to make timely disclosure are contemplated. It hopes to send a clear message to those who choose to represent themselves, that should they choose to do so they must ensure that they know and follow the rules as well as the law.

Factors Supporting a Reduced Award

[74] I have also taken into account several factors that point to a need to reduce the total costs of the applicant. Those factors are:

a. The applicant was not successful in her bid to have the respondent pay for ½ of the application fee for teacher's college;

b. The applicant was not successful in recovering all of the expenses she claimed;

c. Neither party was successful in obtaining a determination of whether the respondent's obligation to support the child should continue beyond April 30, 2015, the date upon which she hopes to complete her current program of study.

d. The applicant is not entitled to costs on a full recovery basis given she was not successful on all issues, that the respondent's conduct did not amount to bad faith and given that neither of her two offers to settle met the requirements in Rule 18 for full recovery of costs from the date each offer was served onwards.

[75] I find therefore that a reduction in the total of the applicant's costs is warranted.

CONCLUSION

[76] The applicant has already reduced the amount of costs she seeks from the total of $24,325.02 set out in her costs outline to $15,000. This is a reduction of approximately 40% of the total costs claimed and would result in her recovery of 60% of the total costs claimed.

[77] I have found that a reduction in the total costs claimed is warranted. It is impossible to discern what portion of the applicant's self-imposed reduction of 40% is attributable to an adjustment in order to take into account the benefit to the Unifor Plan and overall fairness. It is not necessary for me to know this because I, for all the reasons I have given, would not have reduced the total costs claimed by more than 40%. In other words, I would not have reduced the amount to be awarded below $15,000.

[78] A cost award in this case of $15,000 inclusive of HST and all disbursements is not only fair and reasonable but also meets all of the objectives of modern cost awards.

AWARD AND ORDER

1. The Respondent shall pay to the Applicant, her costs of the motion to change fixed in the amount of $15,000.

2. These costs are to be paid to the applicant by the respondent in accordance with the following payment plan:

   a. $1,500 to be paid on or before June 30, 2015;

   b. $1,500 to be paid on or before July 30, 2015;

   c. $1,500 to be paid on or before September 1, 2015;

   d. $2,000 to be paid on or before December 31, 2015;

   e. $4,000 to be paid on or before March 31, 2016; and

   f. $4,500 to be paid on or before June 30, 2016.

3. These costs shall be enforceable as child support by the Family Responsibility Office.

Released: February 12, 2015

Signed: "Justice Victoria Starr"