ONTARIO COURT OF JUSTICE

CITATION: N.M.L. v. A.T.C., 2022 ONCJ 250

DATE: 2022·05·18

COURT FILE No.: Woodstock D199/18

BETWEEN:

N.M.L.

Applicant

— AND —

A.T.C.

Respondent

Before Justice S. E. J. Paull

In Chambers

Reasons on Costs released on May 18, 2022

James Battin......................................................................................... counsel for the applicant

Rebecca Fox..................................................................................... counsel for the respondent

PAULL J.:

[1] On March 8, 2022 the court released Reasons for Judgement following a trial heard over four days where the only issue involved the respondent’s parenting time. He sought supervised parenting time and the applicant sought an order that he have no parenting time to the parties’ three year old daughter. The court made an order for supervised parenting time.

[2] The respondent seeks costs in the amount of $10,960 inclusive of HST on the basis that he was the successful party, that the result was equal to his offer to settle, and that the applicant had behaved unreasonably.

[3] The applicant submits that there should be no order as to costs on the basis of her precarious financial situation and the negative impact any costs order would have on the child who is in her primary care.

The Law

[4] The Ontario Court of Appeal in Mattina v. Mattina, 2018 ONCA 867 set out that modern costs rules are designed to foster four fundamental purposes:

(1) to partially indemnify successful litigants;

(2) to encourage settlement;

(3) to discourage and sanction inappropriate behaviour by litigants and;

(4) to ensure that cases are dealt with justly under subrule 2 (2) of the Family Law Rules (all references to the rules in this decision are to the Family Law Rules).

[5] Costs awards are discretionary. Two important principles in exercising discretion are reasonableness and proportionality. Beaver v. Hill, 2018 ONCA 840.

[6] Subrule 24(1) 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 22584 (ON SC), [2000] O.J. No. 330 (SCJ-Family Court).

[7] To determine whether a party has been successful, the court should examine who was the successful party, based on the positions taken in the litigation. Lazare v. Heitner, 2018 ONSC 4861. This assessment includes the positions taken in the pleadings, and the specific relief sought at the hearing, if different. Kyriacou v. Zikos, 2022 ONSC 401. The court may also consider how the order compares to any settlement offers that were made. Lawson v. Lawson, 2008 23496 (ON SC), [2008] O.J. No. 1978 (SCJ); Todor v. Todor, 2021 ONSC 3463; Kyriacou v. Zikos, supra.

[8] Subrule 18 (14) of the Family Law Rules 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:

1. If the offer relates to a motion, it is made at least one day before the motion date.

2. 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.

3. The offer does not expire and is not withdrawn before the hearing starts.

4. The offer is not accepted.

5. The party who made the offer obtains an order that is as favourable as or more favourable than the offer.

[9] Even if the terms of subrule 18(14) are followed, the court still has the discretion not to order full recovery costs. C.A.M. v. D.M., 2003 18880 (ON CA)

[10] Subrule 24 (12) reads as follows:

24 (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.

Analysis

[11] The respondent was clearly the successful party as he achieved the order he sought at trial for supervised access. He also made an offer to settle that closely mirrors the order granted. There was no evidence that the applicant served an offer to settle.

[12] Failure to make an offer to settle can be unreasonable behaviour. However, where a case is binary, where one side would win and the other lose, little weight was given to offers to settle. Kostyrko v. Kostyrko, 2020 ONSC 3537.

[13] This trial involved the singular and binary issue of whether the respondent was to have supervised parenting time or no parenting time. It was a win or lose proposition with little room for compromise by either party. In this situation I do not place significant weight on the respondent’s offer to settle or the applicant’s failure to make an offer to settle.

[14] However, the respondent was the successful party, and the applicant did not rebut the presumption that the respondent is entitled to his costs.

[15] This case was not particularly complex or difficult conceptually given the narrow and singular issue involved. However, the volume of evidence factually made it was both challenging and time-consuming.

[16] Prior to trial both parties made reasonable efforts and were able to resolve all other issues in this matter. With respect to the issue of the respondent’s parenting time which did proceed to trial the court found that the applicant had been unreasonable by withholding parenting time from the respondent and by breaching two temporary orders for supervised parenting time that she had consented to.

[17] Family law litigants are responsible for and accountable for the positions they take in the litigation: Heuss v. Surkos, 2004 CarswellOnt 3317, 2004 ONCJ 141.

[18] The respondent’s counsel provided a Bill of Costs. Counsel’s hourly rate is reasonable given her years of experience, and the time spent on preparing for and attending the trial was not unreasonable given the volume of evidence offered by the applicant.

[19] Unfortunately, the applicant did not submit her own bill of costs for the court to compare it to the respondent’s. The case law sets out that a useful benchmark for determining whether costs claimed are fair, reasonable and proportionate is to consider the amount that the unsuccessful party paid for their own legal fees and disbursements in the same matter. Laidman v. Pasalic and Laidman, 2020 ONSC 7068.

[20] I have also considered both Boucher et al. v. Public Accountants Council for the Province of Ontario, 2004 14579 (ON CA), [2004] O.J.No. 2634 (Ont. C.A.) and Delellis v Delellis and Delellis, 2005 36447 (ON SC), [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.

[21] Costs need to be proportional to the issues and amounts in question and the outcome of the case. Amounts actually incurred by the successful litigant may therefore not be determinative. Hackett v. Leung, 2005 42254 (ON SC), [2005] O.J. No. 4888 (Ont. S.C.J.). The rules do not require the court to allow the successful party to demand a blank cheque for their costs. O’Brien v. O’Brien, 2017 ONSC 402.

[22] The applicant submits that there should be no order for costs despite the respondent’s success at trial because she has a limited and fixed income from ODSP and is the child’s primary caregiver. She also points out that there is some level of arrears in support owing by the respondent which has put additional financial stress on her and the child.

[23] The court should also take into consideration the ability of a party to pay costs. MacDonald v. Magel (2003), 2003 18880 (ON CA), 67 O.R. (3d) 181 (Ont. C.A.). In Van Rassel v. Van Rassel, 2008 56939 (ON S.C.), [2008] O.J. No. 4410, 61 R.F.L. (6th) 364 (S.C.J.) at para. 9 Mossip J. concluded that the court should also consider the financial means of the unsuccessful party including the issue of the impact on the child of the paying party of a large costs order.

[24] However, ability to pay alone cannot, nor should it, over-ride the other factors in Rule 24(11). Peers v. Poupore, 2008 ONCJ 615. Difficult financial circumstances are a factor but are not always a reason to deprive a successful party of costs or to reduce the amount of costs. Beaulieu v. Diotte, 2020 ONSC 6787. A party’s limited financial circumstances will not be used as a shield against any liability for costs but will be taken into account regarding the quantum of costs, particularly when they have acted unreasonably and are the author of their own misfortune. Snih v. Snih, 2007 20774 (Ont. SCJ pars. 7-13).

[25] Parties cannot expect to be immune from an order of costs based on their limited financial resources. If this were the case, parties would be free to conduct litigation as they wished without fear of reprisal in the form of adverse costs orders, and this would be contrary to the philosophy and requirements of the Rules. Culp v. Culp, 2019 ONSC 7051 (SCJ); Mark v. Bhangari, 2010 ONSC 4638 (SCJ).

[26] I agree with Justice O’Connell in Moreno v. Tuey, 2019 ONCJ 418 (para. 46), that when, “fixing costs the court cannot ignore the best interests of the child and thus cannot ignore the impact of a costs order against a custodial parent that would seriously affect the interest of the child”. In that case no costs were ordered. However, the parties resolved all outstanding issues except costs thereby avoiding a trial.

[27] In this case a trial over four days was required on the issue of the respondent’s parenting time at which he was successful, and the applicant was found to have acted unreasonably.

[28] I find that the applicant’s financial circumstances are relevant, and I further find that a significant costs order would likely have a negative impact on the child’s best interests due to the applicant’s limited income. However, given the entirety of the circumstances she ought not to be absolved from any costs disposition for these reasons. Rather, the quantum of costs and the manner of their payment should reflect these factors. To balance these factors and minimize the potential impact on the child, the costs shall be payable at a rate of $200 per month, unless the parties agree to another payment arrangement.

[29] Having considered all these issues, the respondent is entitled to recovery of costs on a partial indemnity basis. I find that a reasonable and fair quantum in the particular circumstances of this case to be $4800 inclusive payable by the applicant to the respondent at a rate of $200 a month commencing June 1, 2022 and monthly thereafter until paid in full.

Released: May 18, 2022

Signed: “Justice S. E. J. Paull”