Court File and Parties
Date: January 31, 2017
Court File No.: D82001/15
Ontario Court of Justice
Between:
Jeevaneelosany Sivasubramaniam
Dilani Gunarajah, for the APPLICANT
APPLICANT
- and -
Elangeswaran Chandrasekaram
Andrea B. Scharf, for the RESPONDENT
RESPONDENT
Diane Gillies, for the DIRECTOR OF THE FAMILY RESPONSIBILITY OFFICE, party only for the purpose of this motion
Heard: In Chambers
Justice: S.B. Sherr
Costs Endorsement
Background
[1] This is a costs decision arising out of a motion brought by the respondent (the father), for the following relief:
a) Staying or suspending the enforcement of the child support provisions contained in the parties' separation agreement (the agreement), made on March 14, 2007 and filed with the court pursuant to subsection 35(2) of the Family Law Act, until resolution of his application to change child support;
b) An order staying or suspending enforcement of the existing support deduction order, until resolution of his application to change child support;
c) An order that the Director of the Family Responsibility Office (the Director) hold any monies received in this matter until the resolution of his application to change child support.[1]
[2] The applicant (the mother) opposed the father's motion and asked for an order that the Director immediately release the monies it has collected to her to satisfy the father's support arrears.
[3] The Director took no position with respect to the parties' entitlement to the funds it was holding. However, it sought court authority if monies were to be held back from the mother.
Court Orders
[4] The court made the following orders:[2]
a) The Director shall immediately release the sum of $10,400 from the monies it is holding to the mother.
b) A new support deduction order shall issue reflecting that the father is required to pay the mother $800 each month.
c) The Director shall, starting on February 1, 2017, release to the mother the sum of $800 each month. If the Director is unable to collect this amount from the support deduction order, or through other enforcement means, it shall pay any shortfall to the mother from the monies it is holding.
d) Subject to clause (c), the Director shall hold the balance of the monies in its possession, pending the final disposition of the issue of entitlement, pursuant to subsection 56(2) of the Family Responsibility and Support Arrears Enforcement Act.
e) The balance of the father's motion is dismissed.
Factual Background
[5] The parties presented very different versions of their living arrangements. The father deposed that he had lived with the mother from 2006 until February, 2014. The mother claimed that the father never lived with her during this period.
[6] The court found that this determination couldn't be made from the competing evidence provided by the parties and that both had presented plausible evidence to support their version of events. If the parties are unable to resolve this issue, a trial will be required to determine it.
Costs Submissions
[7] The court permitted the parties and the Director to make costs submissions. The father seeks his costs of $28,417.
[9] The father did not specify who he was seeking costs from. The Director prepared submissions asking that no costs be awarded against it.
[10] The mother seeks costs of $3,791.95 from the father.
Legal Principles
[11] The Ontario Court of Appeal in Serra v. Serra, 2009 ONCA 395 stated that modern costs rules are designed to foster three fundamental purposes, namely: to partially indemnify successful litigants for the cost of litigation, to encourage settlement and to discourage and sanction inappropriate behaviour by litigants bearing in mind that the awards should reflect what the court views is a fair and reasonable amount that should be paid by the unsuccessful party.
[12] Subrule 24(1) of the Family Law Rules (all references to rules in this endorsement are the Family Law Rules) creates a presumption of costs in favour of the successful party. Consideration of success is the starting point in determining costs. See: Sims-Howarth v. Bilcliffe. To determine whether a party has been successful, the court should take into account how the order compares to any settlement offers that were made. See: Lawson v. Lawson.
[13] Subrule 24(6) sets out that if success in a step in a case is divided, the court may apportion costs as appropriate.
[14] Subrule 18(14) reads as follows:
Costs Consequences of Failure to Accept Offer
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:
If the offer relates to a motion, it is made at least one day before the motion date.
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.
The offer does not expire and is not withdrawn before the hearing starts.
The offer is not accepted.
The party who made the offer obtains an order that is as favourable as or more favourable than the offer.
[15] Even if subrule 18(14) does not apply, the court may take into account any written offer to settle, the date it was made and its terms when exercising its discretion over costs (subrule 18(16)).
Analysis of Success
[16] The father made an offer to settle. The mother did not make an offer to settle.
[17] The father's offer to settle did not attract the costs consequences of subrule 18(14). The motion result was more favourable to the mother than the father's offer. The father proposed that all of the funds be held back by the Director, that enforcement of the order be stayed and that he only be required to pay ongoing child support of $200 each month.
[18] There was divided success on this motion. The father was successful in obtaining an order that the Director holdback most of the funds pending further court order. The mother had wanted the funds paid immediately to her. That position was not reasonable at this stage. However, the mother was successful in having $10,400 plus ongoing support of $800 each month paid to her. The father had asked that all monies be held by the Director and on the motion did not propose to pay any ongoing support. This position was also unreasonable, particularly since he clearly has an ongoing child support obligation.[3]
[19] The father was unsuccessful in his effort to stay or suspend the enforcement of the child support provisions contained in the parties' separation agreement. The court also dismissed the father's motion to stay or suspend enforcement of the existing support deduction order.
Time and Proportionality
[20] Significant time claimed by the father related to his claims for relief that were dismissed.
[21] The parties dedicated much of the time on this motion arguing the ultimate merits of the father's application to change child support. While this evidence had relevance to the temporary motion (to conduct a preliminary assessment of the strength of the parties' claims), the trial judge will be in a much better position to assess who should receive costs for the time spent gathering and presenting this evidence. The court should not award any party significant costs for this work at this stage, when, at trial, it could turn out that the other party's version of events is accepted.
[22] The court cannot find that either party was more successful than the other on the motion.
Other Considerations
[23] The father raised other reasons why he should be awarded costs. The motion had to be adjourned once because the mother had just retained counsel and sought to file responding material. This was a reasonable adjournment request.
[24] In his submissions, the father also raises allegations that the mother hid important information and made false representations to the court on the motion. The trial judge will be in a better position to assess whether or not this was the case.
Factors Under Subrule 24(11)
[25] In making this decision, the court considered the factors set out in subrule 24(11), which reads as follows:
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.
[26] The case was important for the parties. It raised important legal issues.
[27] The parties acted reasonably on the motion, although the mother should have made an offer to settle. See: H.F. v. M.H., [2014] O.J. No. 4776 (OCJ).
[28] The time claimed by the father to argue the discrete issues in this motion was excessive. The costs determination must reflect proportionality to the issues argued. There should be a correlation between legal fees incurred (for which reimbursement is sought) and the importance or monetary value of the issues at stake. The rules do not require the court to allow the successful party to demand a blank cheque for their costs. See: O'Brien v. O'Brien, 2017 ONSC 402. Here, the issues in dispute did not justify the time claimed on the motion.
[29] The time claimed by the mother on the motion was reasonable.
[30] If the father was seeking costs against the Director his claim had no merit. The Director acted in accordance with its statutory mandate. It properly asked the father to seek court direction about the funds it was holding when entitlement to them was put in issue. If the father was not seeking costs against the Director, he wasted its time by not making this clear in his submissions.
[31] Time will tell whose position will be accepted on entitlement to the funds held by the Director. The parties had to spend considerable time on this step and the successful party shouldn't have to absorb these costs.
Costs Award
[32] An order will go fixing the costs of this step at $5,000, payable in the cause, or as otherwise determined by the trial judge.
[33] Any claim for costs against the Director is dismissed.
Released: January 31, 2017
Justice S.B. Sherr
Footnotes
[1] The Director was holding $93,542, most of this from the proceeds of sale of the father's home.
[2] The reasons for this decision are set out in Sivasubramaniam v. Chandrasekaram, [2017] O.J. No. 231 (OCJ).
[3] His proposal to pay ongoing child support of $200 each month in his offer was also unrealistic.