Court File and Parties

Ontario Court of Justice

Date: 2015-12-11

Court File No.: Halton 393/05

Between:

Marc John Parker Cornwall Applicant

— And —

Linda Virginia Jevons Respondent

Before: Justice Victoria Starr

Submissions in writing only

Reasons for Costs decision released on December 11, 2015

Counsel:

• Taryn Simionatti, for the Applicant
• Sender Herschorn, for the Respondent

VICTORIA STARR J.:

INTRODUCTION AND OVERVIEW

[1] This is the court's decision and reasons with respect to the issue of costs. It is a difficult decision to make because it is rare for a party to seek costs in circumstances such as those which prevail in this case. This was a straightforward and simple case. Both parties, the mother more so than the father, conducted themselves as model litigants. They both behaved in ways that saved time and expense and minimized strain on the court's resources. They sought help through the Office of the Children's Lawyer and then agreed to adopt all the clinical investigator's recommendations. They diligently pursued settlement through the exchange of multiple offers to settle, and in the end, settled the case, without motions and without a trial. In fact, there was only one actual court attendance, a case conference.

[2] Despite these circumstances, the respondent relies on her overall success and the resulting presumption that she is entitled to costs. She seeks costs on a full recovery basis in the amount of $12,972.40. The applicant seeks an order that the parties bear their own costs of these proceedings, or, in the alternative, that the applicant pay the respondent $500 in costs.

[3] What this decision comes down to is this: what award, if any, achieves an appropriate balance between the three main objectives of modern cost awards:

1. to partially indemnify successful litigants for the cost of litigation;
2. to encourage settlement; and
3. to discourage and sanction inappropriate behaviour by litigants.

PROCEDURAL MATTERS

[4] As part of their settlement the parties agreed that submissions with respect to the issue of costs would be made in writing only. A joint 14B motion, dated October 29, 2015, was filed wherein the parties sought an order, amongst other things, that cost be dealt with by way of written submissions. By way of endorsement dated November 3, 2015, the court indicated that it would review the written submissions, decide the issue, and, if it wished to deliver its decision and reasons orally, have the Judicial Secretary contact them to set a date.

MATERIAL REVIEWED

[5] In reaching its decision the court reviewed: the consent of the parties dated October 2, 2015; the affidavit of Sonia Medeiros, sworn October 29, 2015; the respondent's cost submissions dated October 28, 2015; applicant's cost submissions dated October 28, 2015; and, the respondent's response to the applicant's cost submissions, dated October 29, 2015.

THE REGULATORY CONTEXT

[6] Rule 24 of the Family Law Rules, O. Reg. 114/99, governs the determination of costs in family law proceedings and this case in particular.

[7] The subrules relevant to the circumstances of this case are as follows:

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

(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.

(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.

[8] Rule 24(11) provides a further list of factors that a court must consider when setting the amount of costs:

(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. O. Reg. 114/99, r. 24(11).

ENTITLEMENT

[9] I find that the respondent enjoyed the lion's share of the success and is entitled to the costs of the proceedings. As such, this is a case to which the presumption in subrule 24(1) applies and the respondent is entitled to partial recovery of her litigation costs. In reaching this conclusion I considered the factors set out below in this section.

[10] In his application the applicant sought an order for physical access to the parties' son in accordance with paragraph 15 of the separation agreement dated May 14, 2004. He was not successful in securing this relief. He also sought an order preventing the respondent from speaking ill of the applicant in the presence of the child. He was not successful in securing this relief.

[11] In her answer, the respondent sought an order varying the separation agreement such that she is awarded sole custody of the parties' son. She was successful in securing this relief. She also sought an order for child support (Table amount) and annual financial disclosure and was successful ultimately in obtaining both orders. It is worth noting that in the result, the respondent secured relief that was not claimed such as contribution to the child's post-secondary education costs and a requirement that the applicant obtain and maintain a life insurance policy to secure child support.

[12] With respect to access, the respondent sought to vary the separation agreement such that the applicant have no access to the parties' son subject to the following:

(a) He provide acceptable evidence to show that he is no longer actually consuming alcohol and/or prescription or illegal drugs;

(b) Jackson's reasonable wishes for access, including his concerns about his safety;

(c) The report of the OCL to confirm that access is in Jackson's best interests.

[13] In the result, the respondent was, in essence, successful in securing all of this relief. For example, the child's wishes for no access at this time prevailed, and the only access that the applicant will have is that which the OCL has recommended as both parties agreed to wholly adopt the OCL's recommendations.

[14] While the applicant is better situated as a result of these proceedings (i.e. now has access to information, can send his son cards, etc…), I am not persuaded by the applicant's submission that this creates a situation of divided success on the issue of access. The terms of the order and agreement that now govern his relationship with his son, do not, in any way, resemble the relief he sought in his application.

[15] The only relief that the respondent did not obtain was the restraining order she sought in her answer. As it is not clear to me why she failed to obtain this relief and it does not appear to have been vigorously pursued, I do not count this as a success on the applicant's part.

QUANTUM

Time Spent, Lawyer's Hourly Rates, and Reasonable Disbursements

[16] The applicant concedes, and I find, that the respondent's lawyer's hourly rates are reasonable.

[17] The applicant does not take issue with, and I find that, the disbursements reflected in the bill of costs were reasonable and necessary.

[18] The applicant submits that the time spent seems high given that this matter was very straightforward, with only one court appearance, one appearance for the OCL disclosure meeting, and given the quick settlement. The total time spent was about 35.35 hours. The applicant does not, however, dispute any particular item reflected in the respondent's bill of cost.

[19] The applicant's characterization of the steps in the case is overly simplistic. There was a lot more involved on the applicant's part in getting the parties to the point of settlement and to the conclusion of proceedings. For example, there was:

(a) An answer to draft;

(b) Disclosure to review;

(c) A case conference to prepare for and attend;

(d) OCL intake form to complete;

(e) Two offers to settle to draft and serve;

(f) Review of the two offers to settle served by the applicant;

(g) An agreement to draft once settlement was reached;

(h) Various 14B motions to adjourn case conference;

(i) A 14B motion to prepare and submit in order to obtain a final order and to have costs determined by way of written submissions; and,

(j) Multiple discussions that needed to occur between counsel and the respondent and her counsel.

[20] These things all took time. I find that 35.35 hours' time spent in total is a reasonable amount of time to have spent overall.

[21] I note as well from my review of the respondent's bill of costs that while the time spent includes dictating the bill of costs, it does not include the time spent drafting cost submissions or the time that will be spent redrafting the order to be submitted to the court. In fact, the time that will ultimately be spent will likely be a few hours more than the time already spent and this inures to the applicant's benefit as a further cost saving.

[22] There is no reason to reduce the quantum of costs awarded to the respondent, based on the time spent or disbursements claimed.

Importance, Complexity or Difficulty of the Issues

[23] A significant consideration which serves to shield the applicant from a substantial cost award is the importance, complexity and difficulty of the issues. The central contested issue in this case was access and it was, from both parties' and the child's perspective, a very important one.

[24] I find that it was necessary for the applicant to commence proceedings because the respondent was not allowing him any access or communication with their son. As a result of the agreement reached, the applicant will now have access to the child's school and medical records and monthly updates from the respondent regarding the child. In addition, the child will be encouraged to seek counseling and the applicant is also able to send the child birthday cards, gifts and letters. By commencing the litigation, and irrespective of his lack of candor in his application, the possibility now exists for the applicant and the child to begin to repair their relationship. There would have been no prospect of this had the applicant not issued the application.

[25] The litigation was neither complex nor difficult. There was only one actual court attendance, the first case conference. There were no motions (except the joint 14B motion regarding costs and for adjournments), and no trial. The parties accepted the recommendations of the OCL soon after they were provided. Within a short period thereafter this matter was settled based on the offers to settle exchanged between the parties.

Reasonableness of the Respondent's Behaviour

[26] Subrule 24(11)(b) refers to the reasonableness or unreasonableness of each party's conduct. I find that the respondent's litigation conduct was beyond reproach. There is nothing about her conduct that could serve as a justification to reduce the amount of costs awarded to her.

[27] In coming to this conclusion I place weight on these considerations:

(a) She did not advance, in her initial pleadings, a position that was unreasonable. She sought a no access order subject to further evidence, input from the OCL and the child's wishes;

(b) Her efforts were designed to elicit the truth and to protect the parties' son, the reasonableness and necessity of which is evidenced by both the findings and recommendations of the OCL and the respondent's overall success in the result;

(c) She made reasonable efforts to settle the issues (including submitting two offers to settle);

(d) Wherever possible she suggested ways, through her lawyer, to shorten this proceeding, including adjourning conferences and resolving the cost issue by way of 14B and written submissions.

[28] With respect to the reasonableness or unreasonableness of the applicant's conduct, I find that the applicant was not candid in the representations contained in his application. This does not amount to bad faith or even to a level of unreasonableness that would attract cost consequences. While this conduct did marginally increase the respondent's costs, I find the applicant's behaviour inconsequential in relation to costs as the respondent would likely have included reference to the applicant's "flaws", in any event. Also, the application was a pleading, not an affidavit.

[29] In any event, the applicant is shielded, I find, from a substantial cost award by the reasonableness of his litigation conduct.

[30] With the exception of omitting important facts from his application, the applicant's litigation conduct was very reasonable. In this regard I note the following conduct which saved time and expense:

(a) The applicant agreed to the respondent's request for an order requesting the involvement of the OCL at the first opportunity;

(b) At the first case conference, the parties came to a consent on numerous other issues regarding disclosure, all of which the applicant satisfied;

(c) He accepted the recommendations of the OCL in their entirety;

(d) He served two reasonable offers to settle: one dated August 21, 2015 and the other August 26, 2015;

(e) The applicant did not prolong this matter but in fact attempted to settle it in the most cost-effective way;

(f) He not only settled quickly and early on in the case but he agreed to terms of settlement that went beyond what the respondent had claimed or this court has jurisdiction to order (i.e. life insurance).

[31] Based on the cost submissions before me, it is hard to imagine how the applicant could have been more reasonable or what more he could have done. This type of litigation behaviour is to be encouraged.

[32] The importance of the issues, straightforward nature of the case, and the applicant's reasonable behaviour together justify a significant reduction in the amount of costs to be awarded. Put another way, they move the goal from full or substantial indemnity to partial indemnity.

Promoting Settlement and Encouraging Reasonable Behaviour

[33] To award the respondent only $500 in costs as the applicant suggests, would fail to give any meaningful recognition of her substantial success, the key role her exemplary litigation conduct played in saving time and expense, and the reasonableness of the time spent by her counsel. An award of only $500 would fail to give any meaningful recognition to these factors and thus, would undermine the objective of indemnification and it would also do nothing to promote the objectives of promoting settlement and reasonable behaviour by rewarding same.

[34] On the other hand, to award the respondent costs in any of the three amounts she seeks, would result in insufficient recognition of the applicant's efforts to save time and expense and to settle the case at the first opportunity. To fail to give significant recognition to such factors, would send a message that there is no point in being generous in settlements or reasonable in the conduct of one's case, in making early and sincere efforts to settle, or in doing so at the first opportunity.

[35] A high cost award such as that sought by the respondent, even at the partial recovery amount she seeks would, thus, undercut the two of the three objectives of modern cost awards. To avoid such a result, the award must be less than the 65% party's often seek when pursuing costs on a partial indemnity basis.

General Discretion to Award What is Fair and Reasonable

[36] My analysis of costs concludes with a consideration of what amount of costs is "fair and reasonable" in the circumstances for the applicant, the unsuccessful party in these proceedings, to pay.

[37] 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…

[38] Taking into account all of the circumstances as well as the court's need to strike the right balance between indemnifying the respondent, promoting settlement, encouraging reasonable behaviour, and discouraging unreasonable behaviour, I find that a cost award equal to 45% of the total amount of costs that the respondent seeks ($5,837.58) inclusive of HST and all disbursements, is fair and reasonable.

FRO ENFORCEMENT

[39] The respondent seeks an order that any award of costs payable to her be enforced through the FRO as an incident of child support. This is not a measure simply meted out because parties request it. To order that all of the costs I have awarded be enforced through FRO I must be satisfied that they were incurred and directly relate to the issue of support.

[40] Based on the submission and the bill of costs, very little of the time spent by counsel for the respondent actually deals with the issue of child support. In this case I cannot parse out the time related to this issue and to others. I note that the applicant has not taken issue with this request. Given that I have awarded the respondent far less than she sought and that some of the time spent was on child support, I find it appropriate to make this order.

CONCLUSION AND ORDER

[41] For all these reasons this court makes the following order:

1. The Applicant shall pay to the Respondent, her costs of these proceedings fixed in the amount of $5,837.58. These costs shall be enforceable against the Applicant by the Family Responsibility Office as an incident of child support.

2. This Order bears post-judgment interest at the rate of 2% per annum effective from the date of this Order. Where there is a default in payment, the payment in default shall bear interest only from the date of default.

Released: December 11, 2015

Signed: "Justice Victoria Starr"

Footnotes

[1] See Serra v. Serra, 2009 ONCA 395, 66 R.F.L. (6th) 40, at paragraph 8

[2] See Farjad-Tehrani v. Karimpour, 2009 CarswellOnt 2186 (S.C.J.), aff'd 2010 ONCA 326, at paragraph 4