Court File and Parties
Date: April 11, 2017
Court File No.: D90509/16
Ontario Court of Justice
Between:
P.H.
Amanda Taerk, for the Applicant
APPLICANT
- and -
T.J.
Acting in Person
RESPONDENT
Heard: In Chambers
Justice: S.B. Sherr
Costs Endorsement
[1] On March 9, 2017, the court released its reasons for decision arising out of a two-day trial about the parenting arrangements for the parties' seven-year-old child (the child). See: P.H. v. T.J., 2017 ONCJ 166.
[2] The court gave the parties the opportunity to make written costs submissions. The applicant (the mother) seeks her costs of $3,980. The respondent (the father) asks that no costs be ordered.
[3] The Ontario Court of Appeal in Serra v. Serra, 2009 ONCA 395, [2009] O.J. 1905 (Ont. C.A.) 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.
[4] 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, [2000] O.J. No. 330 (SCJ- Family Court). 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, [2008] O.J. No. 1978 (SCJ).
[5] The mother did not make an offer to settle. This court has often written that it will usually be unreasonable behaviour to fail to make an offer to settle. The court wrote in paragraphs 4-5 of Klinkhammer v. Dolan and Tulk, 2009 ONCJ 774, [2009] O.J. No. 6370 (OCL):
4 It was surprising that there were no formal offers to settle in this case. It is reflective of the polarity of the parties. It should be a fundamental step in any family law case to serve at least one offer to settle. Parties and their counsel now have a mandate under subrule 2(4) of the rules, to promote the primary objective of the rules; to deal with cases justly (subrule 2(2)). Dealing with a case justly includes taking steps to save time and expense (subrule 2(3)). Offers to settle play an important role in saving time and expense in a case. They are an important vehicle in promoting settlements, focus the parties and often narrow the issues in dispute.
5 There are consequences in the rules for not making or accepting reasonable offers to settle. Subrule 18(14) sets out the costs consequences of not accepting an offer to settle that is as good as or better than the final result. When determining the reasonableness of a party's behaviour in the case, clauses 24(5)(b) and (c) of the rules direct the court to examine the reasonableness of any offer made, withdrawn or not accepted. This does not preclude the court from examining the failure of a party to make an offer to settle.
[6] The father states that he made an offer to settle on August 24, 2016. He did not attach a copy of the offer to his submissions, but from reading the submissions it appears that he offered to settle the case on an equal time-sharing basis.
[7] 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.
[8] 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)).
[9] The onus of proving that the offer is as or more favourable than the trial result is on the person making the offer. See: Neilipovitz v. Neilipovitz, [2014] O.J. No. 3842 (SCJ).
[10] The father's offer to settle was not more favourable to the mother than the trial result. The mother was granted sole custody of the child. The father was granted specified access. The regular access schedule ordered was as follows:
Week One – From Fridays after school until Monday delivery to school. This will extend to Tuesday delivery to school, if the Monday is a statutory holiday. The child shall also spend Thursday after school until 7:30 p.m. with the father.
Week Two – Tuesday from after school until Thursday delivery to school.
[11] The court also ordered additional holiday time for the father.
[12] The court considered that the father made an effort to settle the case.
[13] The court must next look at the positions taken by the parties at trial. The father sought sole custody of the child and alternate weekend access for the mother. The court ordered sole custody of the child to the mother and an access schedule similar to the one proposed by the mother at trial.
[14] The mother was the successful party based on the positions taken by the parties at trial.
[15] The father did not rebut the presumption that the mother is entitled to costs.
[16] In making this decision, the court considered the factors set out in subrule 24(11), which reads as follows:
Factors in Setting Costs
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.
[17] The case was important for the parties. It was not complex or difficult.
[18] Although the father's position was not accepted at trial, his behaviour was reasonable.
[19] The father submits that no costs should be awarded to the mother because of her unreasonable behaviour. The court finds that except for her failure to make an offer to settle, the mother acted reasonably. Most of the father's submissions regarding unreasonable behaviour by the mother went to issues argued and adjudicated at trial.
[20] The father argued for a reduction of costs because the mother did not seek to compromise until the trial. The court took this submission into consideration. However, a costs objective is to encourage parties to compromise at any stage of the proceedings. The mother took a position that was validated at trial. By contrast, the father's position hardened at trial and was not supported by the evidence. There are costs consequences for making these choices.
[21] The rates claimed by the mother's lawyer were very reasonable.
[22] The amount of time claimed by the mother for a two-day trial was very modest.
[23] The court considered both Boucher et al. v. Public Accountants Council for the Province of Ontario, [2004] O.J. No. 2634 (Ont. C.A.) and Delellis v. Delellis and Delellis, [2005] O.J. No. 4345. Both these cases point out that when assessing costs it is "not simply a mechanical exercise." In Delellis, Aston J. wrote at paragraph 9:
However, recent cases under the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, as amended have begun to de-emphasize the traditional reliance upon "hours spent times hourly rates" when fixing costs....Costs must be proportional to the amount in issue and the outcome. The overall objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particular circumstances of the case, rather than an amount fixed by the actual costs incurred by the successful litigant.
[24] The court considered the father's ability to pay the costs order. See: MacDonald v. Magel, 67 O.R. (3d) 181 (Ont. C.A.). The father recently completed his education and is trying to start a business. His current financial circumstances are limited. The court will give the father time to pay this costs order.
[25] Taking into account these considerations, an order shall go that the father shall pay the mother's costs fixed in the amount of $3,000, inclusive of fees, disbursements and HST. The father may pay the costs at the rate of $200 each month, starting on May 1, 2017. However, if he is more than 30 days late in making any payment, the entire amount of costs shall immediately become due and payable.
Released: April 11, 2017
Justice S.B. Sherr