Court Information

Ontario Court of Justice

Date: May 7, 2019

Court File No.: Toronto D91264/16

Parties

Between:

TREENA LYNN SPEERS Applicant (Mother)

— and —

MILFRED FOSTER Respondent (Father)

Before the Court

Justice Robert J. Spence

Costs Submissions in Writing

Counsel

• Ms. Denise Badley — counsel for the applicant
• Mr. David Russell — counsel for the respondent

Endorsement

1: Introduction

[1] On March 28, 2019 I released my trial judgment granting the restraining order which the mother had requested against the father, in favour of herself. However, I denied the mother's request for a restraining order in favour of the mother's teenaged daughter.[1]

[2] The trial lasted parts of two days. The court provided the parties with the opportunity to make costs submissions.

[3] The mother now seeks her costs of that trial.

2: Position of the Parties

[4] The mother seeks an order that the father pay costs on a full recovery basis in the amount of $11,734, inclusive of all legal fees, H.S.T. and disbursements, covering the period from November 1, 2018 to the conclusion of trial.

[5] The father's position is quite different. For reasons which he outlines in his submissions, he asks the court to limit the costs order to between $750 and $1,000.

3: Costs Principles as Set Out in the Family Law Rules

[6] Subrule 24(1) creates a presumption of costs in favour of the successful party. Accordingly the starting point for deciding costs in this case is the degree of success.

[7] The mother sought restraining orders in favour of herself and her teenaged daughter. She succeeded in respect of the former but not the latter.

[8] That said, the mother's claim and the trial itself was focused primarily on the mother's request for a restraining order to protect herself, rather than the mother's request for a restraining order in favour of her daughter. As a result, the court considers the mother to be the successful party.

[9] The court must consider a number of other subrules in deciding costs, including subrules 24(12) - the factors in setting the amount of costs; subrule 24(4) – whether a successful party behaved unreasonably; subrule 24(8) – whether a party acted in bad faith; and subrule 18(14) – whether a party served an offer to settle.

4: Father's Request for Minimal Costs

[10] Father's counsel raises a number of arguments in support of his position. First, he says that the trial had originally been set for a half-day, and the only reason the matter could not be concluded on that first scheduled date is because mother's counsel exceeded the parties' agreed-upon time limits for cross-examinations.[2]

[11] I have no record that this occurred. Nor was it pointed out to me or objected to by father's counsel during the trial. To the extent that mother (or father) may have exceeded cross-examination time limits which the parties had agreed to at the trial management conference, I do not find that the time either counsel spent was in fact unproductive or not useful in eliciting relevant evidence. This was not a case where any agreed-upon time limits were blatantly ignored without the court's permission, such that court time was wasted.

[12] Next, father's counsel argued that mother's counsel arrived late for the continuation of the matter on the second day. Again, I do not have a record of mother's counsel having arrived late or in some other way wasting the court's time, or father's time.

[13] Ultimately, father argues that costs should be awarded on a partial indemnity basis for a two-hour trial, including preparation, but excluding the continuation date. He submits that costs in the amount of $1,500 to $2,000 would be appropriate, reduced by 50% for partial success at trial.

5: Mother Seeks Full Recovery of Costs

[14] Mother seeks full recovery of costs. Her authority for that request rests in part on the frequently-cited case of Biant v. Sagoo. In that case, the court stated that the preferred approach to costs is to make awards which generally approach full recovery, so long as the successful party has behaved reasonably and the costs claimed are proportional to the issues before the court at trial.

[15] However, that full-recovery costs interpretation in Biant has since been disapproved of by the Ontario Court of Appeal in Beaver v. Hill, 2018 ONCA 840. The decision in Beaver was released by the Court of Appeal more than six months ago. It is a case that counsel need to have familiarized themselves with when they are about to make costs submissions. Referring to outdated case law does a disservice to their clients. Neither counsel in this case made reference to the decision in Beaver.

[16] Beginning at paragraph 8, the Court of Appeal in Beaver states [my emphasis]:

[8] Yet, that is not how the costs in this case were determined. Rather, the resulting award approached a full recovery amount. In defence of that result, the respondent relies on what is contended to be the principle from Biant v. Sagoo, [2001] O.J. No. 3693, 20 R.F.L. (5th) 284 (S.C.J.) that costs in family proceedings should "generally approach full recovery". I would make a couple of points in response to that contention.

[9] First, while the judge in Biant does make that statement, it is based on two decisions of other Superior Court judges, a close reading of which do not support the thrust of that statement. What those other cases do establish is that under the Family Law Rules, O. Reg. 114/99, judges are not constrained to the normal scales of costs found in the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, since no scales of costs are mentioned in the Family Law Rules. Also, the Family Law Rules expressly provide that, depending on the conduct of the parties and the presence or absence of offers to settle, a judge may increase or decrease what would otherwise be the appropriate quantum of costs awarded.

[10] Second, the respondent's assertion that this court's decision in Berta v. Berta, 2015 ONCA 918, 128 O.R. (3d) 730 supports the "full recovery" approach to costs in family matters also reflects a failure to read the decision closely. What this court endorsed in that case was the principle that "a successful party in a family law case is presumptively entitled to costs" (at para. 94) subject, though, to the factors set out in Rule 24. This caveat is an important one since, as this court pointed out in Frick v. Frick, 2016 ONCA 799, 132 O.R. (3d) 321, the Family Law Rules "embody a philosophy peculiar to a lawsuit that involves a family" (at para. 11).

[11] There is no provision in the Family Law Rules that provides for a general approach of "close to full recovery" costs. Rather, r. 24(12) sets out the appropriate considerations in fixing the quantum of costs. It reads:

(12) In setting the amount of costs, the court shall consider,

(a) the reasonableness and proportionality of each of the following factors as it relates to the importance and complexity of the issues:

(i) each party's behaviour,

(ii) the time spent by each party,

(iii) any written offers to settle, including offers that do not meet the requirements of rule 18,

(iv) any legal fees, including the number of lawyers and their rates,

(v) any expert witness fees, including the number of experts and their rates,

(vi) any other expenses properly paid or payable; and

(b) any other relevant matter

[12] As the wording of the rule makes clear, proportionality and reasonableness are the touchstone considerations to be applied in fixing the amount of costs.

[13] Further, a "close to full recovery" approach is inconsistent with the fact that the Family Law Rules expressly contemplate full recovery in specific circumstances, e.g. bad faith under r. 24(8), or besting an offer to settle under r. 18(14). Consequently, the motion judge erred in principle in adopting a "close to full recovery" approach in fixing the costs of these motions. I would note that such a result also appears inconsistent with her determination that full recovery costs were not appropriate in this case

6: Assessing the Appropriate Amount of Costs

6.1: Applicability of Rule 18 – Offers to Settle

[17] Subrule 18(14) does not apply to this case, for the following reasons. First, the mother's offer to settle was dated March 21, 2019, more than four weeks after the trial commenced on February 15, 2019, and after the evidence portion of the trial was completed. All that remained to complete the trial was the parties' submissions, which were scheduled for March 25, 2019. For an offer to settle to engage subrule 18(14), the offer must be made "at least seven days before the trial or trial date".[3]

[18] The mother did not achieve a result "as favourable as or more favourable than the offer".[4]

[19] Furthermore, that offer contained certain conditions pertaining to mother's teenaged daughter, conditions which were not part of the court's final order.

[20] The mother argues that the court may nevertheless consider the offer and exercise its discretion in favour of the mother pursuant to subrule 18(16), even though subrule 18(14) does not apply.

[21] Having regard to the foregoing, the court finds no reason to exercise its discretion in favour of the mother pursuant to subrule 18(16). Accordingly, based on Rule 18, there is no presumption that mother is entitled to full recovery of her costs.

6.2: Assessing Costs Pursuant to Rule 24

[22] Mother argues that even if her offer to settle does not bring her within the presumption of full recovery of costs under Rule 18, she should be entitled to full recovery of costs under subrule 24(8), on the basis that the father acted in bad faith.

[23] Mother argues that the father conducted himself in bad faith because he failed to acknowledge his wrongdoing and its effect on the mother during the case, forcing her to defend her case.

[24] In fact, as my reasons for judgment disclose, in his testimony the father did acknowledge that he had behaved badly, and he also acknowledged (at least to some extent) the impact of his behaviour on the mother.

[25] In S.(C.) v. S.(M.), Justice Craig Perkins addressed in some detail the meaning of bad faith. He gave a number of examples of the types of behavior that could constitute bad faith in a proceeding.[5] I do not find it necessary to repeat what Justice Perkins stated, other than to note that the manner in which the father conducted himself in this proceeding did not constitute bad faith as discussed by Justice Perkins.

[26] The fact that the father did not settle this matter and that he exercised his right to proceed onto a trial does not constitute bad faith.

[27] The mother further cites the case of S.(C.), supra, for the proposition that even if bad faith is not found the court may still exercise its discretion to make a costs order approaching full recovery. The facts in S.(C.) were very different than the facts of this case. Furthermore, the court in that case did find that there was bad faith. And finally, an order for full recovery of costs without a finding of bad faith would be inconsistent with the law as stated in Beaver, supra.

[28] Having regard to the foregoing, the court concludes that there is no entitlement to full recovery of costs under Rule 24.

[29] As the court noted earlier, the mother is presumed to be entitled to her costs because she was the successful party.

[30] The factors which the court is to consider in assessing her costs are contained in subrule 24(12), set out above.[6] Each of these factors is to be considered having regard to reasonableness and proportionality, as it relates to the importance and complexity of the issues.

[31] Clause 24(12)(a)(i) – each party's behaviour. Apart from the parties' respective positions pertaining to the request for a restraining order, I do not find that either party acted in an unreasonable manner during the litigation. To be clear, the father's opposition to the requested restraining order does not, in and of itself, constitute bad behaviour.

[32] Clause 24(12)(a)(iii) – written offers to settle. I have previously dealt with this issue.

[33] Clause 24(12)(a)(v) – experts. Not applicable to this case.

[34] Clause 24(12)(a)(vi) – expenses properly paid or payable. Applicant's disbursements totalled $165.66, inclusive of H.S.T. No dispute was raised respecting these disbursements and, in any event, those disbursements appear reasonable.

[35] Clause 24(12)(b) – any other relevant matter. There were no unusual, relevant circumstances about this case that are not captured by the various factors set out in clauses 24(12)(a)(i) to (vi), such that the court would need to otherwise consider an adjustment to the costs award.[7]

[36] Clauses 24(12)(a)(ii) and (iv) – time spent and legal fees/rates. I have grouped together these two factors given their relationship to each other. And I consider it appropriate to address these factors last, as it is here that problems arise for the mother's claim for costs.

[37] I turn first to counsel's hourly rate. Mother's counsel was called to the Bar in 1997. Her hourly rate is $375 which I consider to be reasonable.

[38] However, it is with respect to some of the time spent by the lawyer that the court has some difficulty. Her Bill of Costs reveals a total of 27.3 hours, including 4.3 hours for trial attendance.

[39] Mother's counsel has simply multiplied 27.3 hours by $375 per hour to arrive at total fees of $11,568.37, inclusive of H.S.T.

[40] None of the times shown on the Bill of Costs are broken down by date. Because of this, it is unclear to the court how much of the time pertains to the actual trial preparation and how much pertains to matters well in advance of the case being set for trial.

[41] Furthermore, as the court noted in Darling v. Booth,[8] even where the court accepts the lawyer's hourly rate as being appropriate, the costs are not determined by a simple mechanical exercise of multiplying the hours spent by the hourly rate.

[42] That said, it would appear that at least four items on the Bill of Costs pertain to matters well in advance of trial, specifically:

1. To drafting court documents – 2.3 hours
2. To meetings with client, to calls with client – 4.5 hours
3. To written correspondence to client and solicitor – 0.7 hours
4. To court preparations for various dates [my emphasis] – 2.8 hours

[43] The total of these items is 10.3 hours. Given counsel's failure to specify when this work was done, as well as the reference in the Bill of Costs to "preparation for various dates", the court infers that it pertained to work respecting case conferences and prior court attendances for which no costs were either requested or ordered.

[44] While the court does have discretion pursuant to subrule 24(11) to award costs for prior steps in the case, the mother has made no submissions respecting this subrule and, specifically, why it would be appropriate for the court to exercise its discretion to award costs for prior steps.[10]

[45] Accordingly, I disallow the entirety of the 10.3 hours.

[46] The work performed by counsel, including preparation for examinations in court, review and analysis of legal authorities and attendance at trial are all reasonable, and proportionate to the matters before the court.

[47] The time spent on these matters was 17 hours.

[48] While the legal issue, namely, whether a restraining order should be granted, was not a particularly complex issue, it was something of considerable importance to the parties, and particularly the mother. The effect of a restraining order is to provide police-enforceable protection for a party. This is what mother sought and this is what she achieved.

[49] Had mother been entitled to full recovery of costs for the 17 hours, I likely would have concluded that she ought to have been compensated for this time, at her lawyer's reasonable hourly rate. However, I have previously concluded that there is no legal basis for awarding full recovery of costs.

[50] In all the circumstances the court concludes that the reasonable and proportional award of costs is $5,000, plus H.S.T. in the amount of $650, plus disbursements in the amount of $165.66 (inclusive of H.S.T.), for a total of $5,815.66.

[51] The father shall pay the mother the sum of $5,815.66 within 30 days by paying those costs directly to Denise Badley, in trust, as requested by the mother in her costs submissions.

Released: May 7, 2019

Signed: Justice Robert J. Spence

Footnotes

[1] The mother's daughter is not the natural child of the father.

[2] The parties had agreed beforehand that each would file their respective evidence-in-chief by affidavit, thereby minimizing the actual court time required for trial.

[3] Subrule 18(14)2

[4] Subrule 18(14)5

[5] At paragraphs 16-19

[6] Counsel for both parties made written submissions based on subrule 24(11), rather than subrule 24(12). Subrule 24(11) was revoked in July 2018 and replaced by subrule 24(12). Given the length of time the current subrule has been in effect, it is disappointing to the court that counsel would make submissions based on a subrule which no longer is in force.

[7] As Beaver, supra states at paragraph 37, other considerations such as the financial circumstances of the costs-paying party may come into play, both in terms of liability for costs as well as the amount of those costs.

[8] 2017 ONSC 6261, cited with approval in Beaver, supra.

[9] The four items are extracted verbatim from the Bill of Costs.

[10] See Beaver v. Hill, 2018 ONSC 3352, at paragraph 27. Although that Court's decision as to quantum of costs was overturned on appeal to the Court of Appeal (See Beaver, supra), it was overturned on different principles which had nothing to do with subrule 24(11). That particular aspect of the Court's decision was left untouched by the Court of Appeal.