Court File and Parties
Ontario Court of Justice
Date: 2016 November 30
Court File No.: Toronto DFO 13 10398
Between:
Sylvester Witter Applicant
— And —
Jeneka Gong Respondent
Before: Justice E. B. Murray
Heard on: November 22, 2016
Decision on Costs
Representation
Mr. Sylvester Witter ..................................................................... Applicant, on his own behalf
Ms. Jeneka Gong ................................................................... Respondent, on her own behalf
Decision
MURRAY, E. B. J.:
Introduction
[1] This is my decision on costs payable by Sylvester to Jeneka on his motion to change a support order made November 4, 2015. Each party was self-represented in this matter. I found that Sylvester had not established a material change in circumstances since the November 2015 order and dismissed his motion. Jeneka was entirely successful on the motion.
[2] Jeneka now claims cost of $8,132.19. This includes monies totalling $1230.19, comprised of monies paid for assistance from a lawyer, from a forensic accountant, to serve and file documents, and for photocopying. The balance of the bill of costs is comprised of charges for the time she spent reviewing documents, preparing documents, researching and attending at court, billed at a rate of $250 per hour.
[3] Sylvester acknowledges that as the unsuccessful party he should reimburse Jeneka for the $1230.19 she is out-of-pocket for the above expenses, but says that should be the limit of costs awarded because Jeneka did not lose opportunities to earn income by virtue of the time she spent on the case.
The Law
[4] Section 131 of the Courts of Justice Act, R.S.O. 1990, c. C-43, as amended, provides that the costs of a proceeding or a step in a proceeding is in the court's discretion. That discretion is circumscribed by rule 24 of the Family Law Rules, O. Reg. 114/99, as amended. The relevant portions of that rule are set out below:
Successful Party Presumed Entitled to Costs
24.(1) There is a presumption that a successful party is entitled to the costs of a motion, enforcement, case or appeal.
(4) Despite subrule (1), a successful party who has behaved unreasonably during a case may be deprived of all or part of the party's own costs or ordered to pay all or part of the unsuccessful party's costs.
Decision on Reasonableness
(5) In deciding whether a party has behaved reasonably or unreasonably, the court shall examine,
- (a) the party's behaviour in relation to the issues from the time they arose, including whether the party made an offer to settle;
- (b) the reasonableness of any offer the party made; and
- (c) any offer the party withdrew or failed to accept.
Bad Faith
(8) If a party has acted in bad faith, the court shall decide costs on a full recovery basis and shall order the party to pay them immediately.
Deciding Costs
(10) Promptly after dealing with a step in the case, the court shall,
- (a) make a decision on costs in relation to that step; or
- (b) reserve the decision on costs for determination at a later stage in the case.
Same
(10.1) In making a decision on costs in relation to a step in a case, the court shall decide in a summary manner whether anyone is entitled to costs and, if so, determine who is entitled and set the amount of the costs.
Factors in Costs
(11) A person setting the amount of costs shall consider,
- (a) the importance, complexity or difficulty of the issues;
- (b) the reasonableness or unreasonableness of each party's behaviour in the case;
- (c) the lawyer's rates;
- (d) the time properly spent on the case, including conversations between the lawyer and the party or witnesses, drafting documents and correspondence, attempts to settle, preparation, hearing, argument, and preparation and signature of the order;
- (e) expenses properly paid or payable; and
- (f) any other relevant matter.
[5] The Rules contain no rule dealing specifically with self-represented parties.
[6] In Fong v. Chan (1999) 46 O.R. (3d) 330, the Ontario Court of Appeal recognized that self-represented litigants may be awarded costs, but not costs calculated on the same basis as a litigant who retains counsel. The court observed that all litigants devote time to dealing with a case, and held: "Costs should only be awarded to those lay litigants who can demonstrate that they devoted time and effort to do the work ordinarily done by a lawyer retained to conduct the litigation and that, as a result, they incurred an opportunity cost by foregoing remunerative activity".
[7] Caselaw on this issue has evolved since Fong was decided in 1999.
[8] Indemnification of a successful litigant is not the only objective of costs rules. Costs rules are also designed to encourage settlement and to discourage and sanction inappropriate behaviour by litigants. For that reason, courts have awarded costs to successful self-represented litigants who have not foregone remunerative activity to do what would otherwise be lawyer's work on a case. Courts have recognized that "without the option of awarding meaningful costs to self-represented litigants, the court's ability to encourage settlements and discourage inappropriate behaviour will be greatly diminished". As one judge observed:
"To require proof of lost income would disqualify litigants who are homemakers, retirees, students, unemployed, unemployable, and disabled and deprive courts of a tool required re: administration of justice."
[9] As noted by Justice Czutrin in Jordan v. Stewart, 2013 ONSC 5037, there is wide variation in the approach taken by courts to quantify costs that are payable to the self-represented litigant.
[10] Most courts base the award at least in part on the time spent doing legal work. However, it is usually difficult to distinguish between the time such a litigant would have devoted to the case if she was represented versus the additional time she has spent doing legal work. Self-represented litigants are not in the practice of keeping dockets itemizing the work done. When courts do attempt to base a costs award on time spent, the hourly rate applied varies widely—from $20 to $150 per hour—and a deduction is made for time that the party would still have spent on the case if represented.
[11] In cases in which the unsuccessful party was represented by a lawyer, some courts have used that lawyer's rates or the costs incurred by that party as a "measuring stick" to determine compensation for the self-represented party. Some courts have used a "rule of thumb" allowing so many hours preparation time for so many hours of trial time.
[12] Courts may consider the quality of the work performed by the self-represented litigant as a factor in a costs decision.
[13] An important threshold consideration is the appropriate level of indemnification, assessed by reference to degree of success and reasonableness of each party's litigation behaviour.
[14] At the end of the day, the amount awarded must be "reasonable, proportional and within the losing party's reasonable expectation".
Analysis
[15] I turn to the application of these principles and the factors in R. 24(11) to this case.
Jeneka was entirely successful. The issue in the motion was very important to her. If successful, Sylvester would have cut his support payment for their child T. in half, retroactive to January 2016, sharply reduced his contribution to T.'s s. 7 expenses, and spread out his payment of the $5000 lump sum payable by June 1, 2016 over more than 8 years.
I have considered Sylvester's litigation behaviour. He entered, with legal advice, into a non-variable support agreement and then applied within 6 months to reduce support retroactively. Sylvester's position basically amounted to a submission that even though he agreed in November of 2015 to an order that provided that his support obligation would not go up or down until November 4, 2017, he only meant to be bound by this agreement if his income went up. This comes close to bad faith. However, I cannot find that Sylvester took the position with the objective of harming Jeneka, and therefore do not make that finding. I do find that the behaviour is highly unreasonable and should be censured in costs. An order for full recovery of costs may be made without a finding of bad faith.
Jeneka lost vacation time and had to work overtime to make up for time spent on work on this case, but did not lose income.
Jeneka produced legal work of good quality. She understood the issues and provided some relevant caselaw.
It is difficult to distinguish between the time Jeneka spent that would have been spent by any litigant on a case, such as reviewing documents, making notes for counsel, attending court, versus what she spent doing work that a lawyer would otherwise have done. By virtue of Rule 24(10), I cannot consider work related only to the case conference held, as no order for costs was made or requested at that time. Reviewing Jeneka's Bill of Costs, I would consider the allowable time devoted to legal work (drafting documents, doing legal research and argument at court on October 20, 2016) as 10 hours.
In determining a reasonable rate to apply, I considered rates for junior counsel and articling students in this region, aiming to use a rate below that. I also considered the quality of Jeneka's work. In my view, a rate of $150 per hour is reasonable. Use of this rate would yield an award of $1500 before disbursements. I am conscious, however, that a proper determination of costs is not simply an exercise of multiplying hours times hourly rate.
I also considered what award would provide a disincentive to Sylvester, in his financial circumstances, to think carefully before bringing another meritless motion to change.
[16] An award of $2500 in costs is reasonable and proportionate given the circumstances of this case and the work done by Jeneka and monies she has paid out. If Sylvester was properly informed as to the principles governing costs, an award in this amount would have been within his reasonable expectation.
Order
[17] I order that Sylvester pay Jeneka the sum of $2500 in costs, inclusive of disbursements and any HST that might be payable. This amount is enforceable as child support, and payable on or before January 6, 2017. A support deduction order shall issue. Jeneka should insure that a fresh SDO form is filed for this purpose.
Released: November 30, 2016
Signed: Justice E. B. Murray