DATE: March 13, 2023 COURT FILE NO.: D43147/22 ONTARIO COURT OF JUSTICE
B E T W E E N:
IYANU EZEKIEL OGUNBOYE APPLICANT (Darrell S. Waisberg, agent, for the Applicant)
- and -
OYEYEMI FAOYE RESPONDENT (Acting in Person)
HEARD: IN CHAMBERS
JUSTICE S.B. SHERR
COSTS ENDORSEMENT
Part One – Introduction
[1] On January 30, 2023, the court released its reasons for decision resulting from a three-day trial pursuant to the Convention on the Civil Aspects of International Child Abduction (the Hague Convention). See: Ogunboye v. Faoye, 2023 ONCJ 46.
[2] The court ordered the return of the parties’ child to Texas, in the United States.
[3] The court found that the applicant (the father) was the successful party and gave the parties permission to make written costs submissions.
[4] The respondent (the mother) was represented by counsel at trial. She filed a Form 4 to Act in Person on January 31, 2023. That day, the mother brought a motion to stay the January 30, 2023 order. The motion was dismissed. The father sought his costs. The court found that the father was the successful party at this step and instructed him to include his costs claim within his written submissions for the trial.
[5] The father seeks costs in the amount of $60,000.
[6] The mother submits that the costs claimed by the father are excessive. She did not submit a specific costs amount that she felt was reasonable and proportionate. She asks the court to defer any costs payment for six months.
Part Two – General costs principles
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).
Costs can be used to sanction behaviour that increases the duration and expense of litigation or is otherwise unreasonable or vexatious. In short, it has become a routine matter for courts to employ the power to order costs as a tool in the furtherance of the efficient and orderly administration of justice. See: British Columbia (Minister of Forests) v. Okanagan Indian Band, 2003 SCC 71, 2003 S.C.C. 71, paragraph 25.
[7] Costs awards are discretionary. Two important principles in exercising discretion are reasonableness and proportionality. See: Beaver v. Hill, 2018 ONCA 840.
[8] An award of costs is subject to the factors listed in subrule 24 (12), subrule 24 (4) pertaining to unreasonable conduct of a successful party, subrule 24 (8) pertaining to bad faith, subrule 18 (14) pertaining to offers to settle, and the reasonableness of the costs sought by the successful party. See: Berta v. Berta, 2015 ONCA 918, at paragraph 94.
[9] Subrule 24(1) creates a presumption of costs in favour of the successful party.
[10] The mother did not rebut the presumption that the father is entitled to costs.
Part Three – Subrule 18 (14) and the father’s offer to settle
[11] Subrule 18 (14) sets out the consequences of a party’s failure to accept an offer to settle that is as good as or better than the trial result of the person making the offer. It 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.
[12] 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)) or, in assessing the reasonableness of a party under sub-clause (iii) of subrule 24 (12) (a).
[13] 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).
[14] The court is not required to examine each term of the offer as compared to the terms of the order and weigh with microscopic precision the equivalence of the terms. What is required is a general assessment of the overall comparability of the offer as contrasted with the order. See: Wilson v Kovalev, 2016 ONSC 163.
[15] Close is not good enough to attract the costs consequences of 18 (14). The offer must be as good as or more favourable than the trial result. See: Gurley v. Gurley, 2013 ONCJ 482.
[16] The father made an offer to settle, dated December 12, 2022, pursuant to rule 18. It was a simple offer – return the child to the father by December 20, 2022.
[17] The court finds that this offer, while close to the final result, does not attract the costs consequences set out in subrule 18 (14). It was not more favourable to the mother than the trial result. The trial result incorporated undertakings for the father, including an undertaking that he comply with the parenting time order from the Texas court.
Part Four – Amount of costs
[18] 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.
[19] In determining the appropriate quantum, the court should consider the amount that the unsuccessful party could reasonably have expected to pay in the event of lack of success in the litigation. See: Arthur v. Arthur, 2019 ONSC 938.
[20] The court should also take into consideration the ability of a party to pay costs. See: MacDonald v. Magel (2003), 67 O.R. (3d) 181 (Ont. C.A.).
[21] The ability to pay will be less of a mitigating factor when the impecunious party has acted unreasonably. See: Gobin v. Gobin, 2009 ONCJ 278; D.D. and F.D. v. H.G., 2020 ONSC 1919. Those who can least afford to litigate should be most motivated to seriously pursue settlement and avoid unnecessary proceedings. See: Mohr v. Sweeney, 2016 ONSC 3338; Balsmeier v Balsmeier, 2016 ONSC 3485.
[22] This case was important to the parties. It involved some factual complexity and difficulty.
[23] The father acted reasonably.
[24] The mother’s litigation behaviour was reasonable. Counsel for the parties cooperated well in expediting the hearing in an orderly manner.
[25] The mother acted unreasonably by abducting the child, making false representations to the father to obtain his consent to enter Canada with the child, hiding her whereabouts from the father, not initially disclosing to this court that there had been a contested parenting proceeding in Texas where she had fully participated with counsel, and by not complying with a temporary parenting time order made by Justice Roselyn Zisman. She also did not make an offer to settle.
[26] The father’s counsel reduced his hourly rate to $550 each hour. This is a reasonable rate for a lawyer with 29-years experience.
[27] The father claimed $285 each hour for work done by his counsel’s law clerk. This is high. In Ahluwalia v. Ahluwalia, 2022 ONSC 2169, the court found that $125 per hour was a reasonable amount to claim for a law clerk. This court recently adopted that approach in Fenton v. Charles, 2023 ONCJ 74. However, not much time was claimed for the law clerk and this will have little impact on the costs award.
[28] The father claimed time spent for prior steps in the case where costs were not ordered or reserved by the case management judge. This included two motions.
[29] Subrule 24 (11) provides that the failure of the court to order costs in relation to a step in a case does not prevent it from awarding costs in relation to the step at a later stage in the case.
[30] However, courts continue to be cautious about awarding costs at the trial stage where costs were not awarded at earlier steps in a case. See: Baezner v. Brunnenmeir, 2018 ONCJ 956; Nabwangu v. Williams, 2019 ONCJ 171.
[31] In Laidman v. Pasalic and Laidman, 2020 ONSC 7068 the court set out that the presumption remains that costs should be determined at each stage, and there are good reasons for this. Parties should have an ongoing awareness of the cost consequences of litigation decisions they make. Reserving costs may impede final resolution by needlessly inflating and complicating the list of future issues still to be dealt with. A judge who has just completed a step in a case will usually be in the best position to evaluate all of the relevant Rule 18 and 24 considerations. Reserving costs to a future event – often to a different judge – can result in later confusion and controversy about what really happened at the earlier step.
[32] In Berge v. Soerensen, 2020 ONCJ 265 Justice Roselyn Zisman set out the following circumstances where costs of a prior step should be awarded:
a) Costs have been reserved to the trial judge.
b) When, considering subsequent events, the trial judge is better situated to determine the costs of the prior step than the judge presiding over the step or,
c) In exceptional circumstances.
[33] None of the criteria set out by Justice Zisman apply here. The court will not order costs associated with the prior steps in the case.
[34] This does not preclude the court from awarding costs accrued from activity not specifically related to a step in the case. Activity not requiring judicial intervention is often better dealt with at the end of the case and not by the motions judge. See: Houston v. Houston, 2012 ONSC 233; Walts v. Walts, 2014 ONSC 98. The court will award costs for this activity which included the drafting and review of pleadings.
[35] The mother submitted that the time claimed by the father in his bill of costs was excessive. She submitted her counsel’s bill of costs that indicated that he spent 47 hours on the entire case. However, this bill of costs did not include any time for trial preparation.
[36] A review of the father’s bill of costs informs the court that the time claimed of over 84 hours for the entire case is high.
[37] The disbursements claimed by the father ($3,931) are reasonable.
[38] The father also seeks his travel costs for traveling round-trip from Texas to Toronto on two occasions – once for court-ordered parenting time, the other to attend at the trial and return with the child to Texas.
[39] The court has expanded authority to order costs in Hague Convention cases. Article 26 of the Hague Convention reads as follows:
Article 26
Each Central Authority shall bear its own costs in applying this Convention.
Central Authorities and other public services of Contracting States shall not impose any charges in relation to applications submitted under this Convention. In particular, they may not require any payment from the applicant towards the costs and expenses of the proceedings or, where applicable, those arising from the participation of legal counsel or advisers. However, they may require the payment of the expenses incurred or to be incurred in implementing the return of the child.
However, a Contracting State may, by making a reservation in accordance with Article 42, declare that it shall not be bound to assume any costs referred to in the preceding paragraph resulting from the participation of legal counsel or advisers or from court proceedings, except insofar as those costs may be covered by its system of legal aid and advice.
Upon ordering the return of a child or issuing an order concerning rights of access under this Convention, the judicial or administrative authorities may, where appropriate, direct the person who removed or retained the child, or who prevented the exercise of rights of access, to pay necessary expenses incurred by or on behalf of the applicant, including travel expenses, any costs incurred or payments made for locating the child, the costs of legal representation of the applicant, and those of returning the child.
[40] Justice Carole Curtis reviewed the court’s expanded costs authority under Article 26 in Lawrence v. Lawrence, 2017 ONCJ 431 at paragraphs 70-75, as follows:
Article 26 of the Hague Convention gives the court jurisdiction to order the respondent parent (the move away parent) “to pay necessary expenses incurred by or on behalf of the applicant, including travel expenses, any costs incurred or payments made for locating the child, the costs of legal representation of the applicant, and those of returning the child”.
The discretion granted in Article 26 is broad. It allows the court to order costs under the following categories:
- to pay necessary expenses incurred by or on behalf of the applicant;
- to pay travel expenses,
- to pay any costs incurred or payments made for locating the child;
- to pay the costs of legal representation of the applicant; and,
- to pay those of returning the child.
- Article 26 of the Hague Convention has three objectives:
a) to compensate the left behind parent for costs incurred in locating and recovering the abducted child;
b) to punish an abducting parent; and
c) to deter other parents from attempting to abduct their children.
Beatty v. Schatz, 2009 CarswellBC 1555, 2009 BCSC 769, [2009] B.C.W.L.D. 4963, [2009] W.D.F.L. 3180, 178 A.C.W.S. (3d) 995, 69 R.F.L. (6th) 102, 70 C.P.C. (6th) 285 (B.C.S.C.), para 16.
The objectives of the Hague Convention would be defeated if the left behind parent were required to fund the process of locating the abducted child and obtaining that child's return: Beatty v. Schatz, 2009, B.C.S.C., supra, para 16.
The Convention anticipates that all necessary expenses incurred to secure the children's return will be shifted to the abductor, both to restore the applicant to the financial position he would have been in had there been no removal or retention, as well as to deter such conduct from happening in the first place: Dalmasso v. Dalmasso, 9 P.3d 551 (U.S. Kan. S.C. 2000), Beatty v. Schatz, 2009, B.C.S.C., supra, para 17; Solem v. Solem, 2013 CarswellOnt 8639, 2013 ONSC 4318, [2013] W.D.F.L. 3211, [2013] W.D.F.L. 3326, [2013] W.D.F.L. 3329, [2013] W.D.F.L. 3331, [2013] O.J. No. 2960, 229 A.C.W.S. (3d) 457, 33 R.F.L. (7th) 120 (Ont. Sup. Ct.), para 10.
Article 26 gives the Court authority to order legal costs beyond those ordinarily provided for in family law cases by the rules of court. The legal costs provided for in the rules are generally only a portion of the actual legal costs incurred: Beatty v. Schatz, 2009, B.C.S.C., supra, para 20.
[41] The court will order costs for the father’s transportation expenses incurred in attending at the trial and returning with the child to Texas ($1883.21). The court finds that the father’s travel costs associated with temporary parenting time are not encompassed by Article 26.
[42] The court recognizes that the mother is a refugee claimant and on Ontario Works. She has a work permit and is attending school to become a personal support worker. She has very limited means. She seeks time to pay the costs to get herself financially settled.
[43] The court has to balance this consideration with:
a) The mother having acted unreasonably.
b) The father having acted reasonably.
c) The mother putting the father to significant financial cost to have the child returned to Texas.
d) The public policy consideration of discouraging child abduction
[44] The court will order the mother to pay the father’s costs fixed at $32,000. This includes fees, disbursements, transportation expenses and HST.
[45] The court finds that the mother should have reasonably expected to pay this amount of costs if the father was successful at trial.
[46] The court will not defer the payment of costs for six months, as requested by the mother. Costs consequences should have some immediacy to be fair, effective and achieve the costs purposes set out earlier in this decision. However, in recognition of her financial circumstances, the court will order a graduated payment schedule for the mother to pay this costs order. She must keep these payments in good standing, or else the entire amount will become due and payable.
Part Five – Conclusion
[47] A final order shall go on the following terms:
a) The mother shall pay the father’s costs of $32,000, inclusive of fees, disbursements, the father’s transportation expenses and HST.
b) The mother may pay the costs at the rate of $100 each month, starting on April 1, 2023, increasing to $200 each month, starting on January 1, 2024, and increasing to $400 each month, starting on January 1, 2025. However, if she is more than 30 days late in making any costs payment, the entire amount of costs then owing shall immediately become due and payable.
Released: March 13, 2023
Justice Stanley B. Sherr