Court File and Parties
ONTARIO COURT OF JUSTICE DATE: January 16, 2023 COURT FILE No.: FO-22-00042409-0000
BETWEEN:
Ludmila Ferreira Pereira Applicant
— AND —
Fabio De Souza Respondent
Before: Justice Roselyn Zisman
Heard: by written submissions Reasons for Judgment released on: January 16, 2023
Counsel: Darlene Rites, counsel for the applicant Jacques Portela, counsel for the respondent
Costs Decision
Zisman, J.:
Introduction
[1] This is my decision on costs with respect to a temporary motion heard on October 3, 2022 and November 30, 2022 with written reasons released on December 12, 2022.
[2] The motion by the Applicant (mother) sought child support and spousal support based on the Respondent (father) having an imputed income of $533,426.74.
[3] The mother was the successful party on the motion. The court held that the father was required to pay child support for their one child in the amount of $4,060.00 per month based on an imputed income of $533,427.00 in accordance with the Child Support Guidelines. The mother was also found to be entitled to spousal support of $5,000.00 per month.
[4] If costs could not be settled, counsel were to submit their written cost submissions with their Bill of Costs and any offer to settle. Both counsel have submitted their cost submissions.
[5] Counsel for the mother seeks costs on a full recovery basis of $10,401.65. It is submitted that the father acted unreasonably and needlessly prolonged the litigation that increased the mother’s legal expenses. The mother relies on the court’s findings that the father did not comply with basic disclosure making it impossible for the counsel for the mother or the court to accurately determine his income for child support and spousal support purposes.
[6] Counsel for the father submits that as he has appealed the decision that the issue of costs should be deferred and heard in the cause by to the Superior Court of Justice – Family Court Branch that will determine the appeal.
[7] In the alternative it is submitted that, if any cost award is made, the costs of the motion should take into consideration that the work claimed by counsel for the mother is “simply work that is ultimately required by all parties to move the proceeding forward in an orderly manner.” It is also submitted that as the mother is eligible for Legal Aid any costs should be awarded at 40% of an hourly rate of $200.00 namely, costs of $2,104.00.
Legal Principles
[8] The Court of Appeal identified the four fundamental purposes that modern cost rules are designed to foster: (i) to partially indemnify successful litigants; (ii) to encourage settlement; (iii) to discourage and sanction inappropriate behaviour by litigants; and (iv) to ensure that cases are dealt with justly: Mattina v. Mattina, 2018 ONCA 867 at para. 10.
[9] Subrule 24(1) Family Law Rules (FLR) creates a presumption that the successful party is entitled to costs.
[10] The exercise of judicial discretion in awarding costs is guided by FLR 24 (12) both in terms of the entitlement of a party to an award of costs as well as to the quantum of that award.
[11] The Ontario Court of Appeal in the case of Beaver v. Hill, 2018 ONCA 840, clarified several aspects of the cost rules namely, that there is no provision in the FLR that provides for a general approach of fixing costs at “close to full recovery” and that “proportionality and reasonableness are the touchstone consideration” to be applied in fixing the amount of costs.
[12] The court held that a cost award is subject to the factors listed in FLR 24(12), the directions set out under FLR 24(4) (unreasonable conduct by the successful party), FLR 24(8) (bad faith) and FLR 18(14) (offers to settle), and the reasonableness of the costs sought by the successful party.
[13] FLR 24 (12) provides the considerations in setting the amount of costs, including the reasonableness and proportionality regarding the parties’ behaviour, the time spent by each party, any written offer to settle, legal fees and any other expenses paid.
[14] The court’s role in assessing costs is not necessarily to reimburse a litigant for every dollar spent on legal fees. An award of costs must be fixed in an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceedings rather than an exact measure of actual costs to the successful litigant: Boucher v. Public Council (Ontario), [2004] OJ No. 2634 (OCA); Delellis v. Delellis.
[15] I have considered and applied the applicable case law and the factors outlined in FLR 24 (12).
Discussion
[16] The mother was the successful party and is presumed to be entitled to costs.
[17] The mother acted reasonably. The father as set out in the decision on the temporary motion did not act reasonably due to a lack of complete financial disclosure that made it difficult for mother’s counsel to properly assess his income and increased the time spent to review the substantial bank records to find gaps and patterns and draw inferences from the limited disclosure that was provided.
[18] The father acted improperly by filing affidavits from the father’s adult children with the sole purpose appearing to be to demean the mother and was of no significance to the issues before the court.
[19] The father also acted improperly by referring to an affidavit being attached his affidavit from the mother’s former abusive husband but then did not attach the affidavit. The mother viewed this an intimidation tactic.
[20] Counsel for the mother spent 26 hours preparing for the motion and for her attendances on the motion. The issues of the mother’s entitlement to spousal support and the income of the father could not be resolved at the case conference and accordingly a temporary motion was necessary. Counsel for the mother has not included in her Bill of Costs the time spent by her articling student with respect to the motion which would have significantly increased the fees.
[21] FLR 24 (12.2) requires a party who opposes the fees or expenses of the opposing counsel to provide documentation outlining their own fees and disbursements. I draw an adverse inference from the father’s counsel’s failure to include his own Bill of Costs.
[22] I find that the time spent was reasonable.
[23] With respect to the hourly rate, counsel for the mother was called to the bar in 2011 and practices exclusively in the area of family law. Her hourly rate of $350.00 is reasonable.
[24] Counsel for the father submits that the court should consider that the mother is in receipt of legal aid.
[25] The issue of whether a counsel who is in receipt of legal aid is entitled to seek costs based on their regular hourly rate has been determined by several cases.
[26] There is binding case law which sets out that the receipt of legal aid is not a factor in determining costs. See Ramcharitar v. Ramcharitar (2002), 62 O.R. (3d) 107 (Ont. SCJ); Holt v. Anderson, [2005] O.J. No. 5111 (Div. Ct.); Alvarez v. Smith; Loncar v. Pendlebury, 2015 ONSC 4673; S.G. v. A.S., 2015 ONSC 1882.
[27] It is clear that pursuant to subsection 46(1) of the Legal Aid Services Act, 1998, "the costs awarded in any order made in favour of an individual who has received legal aid services are recoverable in the same manner and to the same extent as though awarded to an individual who has not received legal aid services.”
[28] A legally aided client "stands before the court in exactly the same position as any other litigant". See Baksh v. Baksh, 2017 ONSC 3997.
[29] The mother served a severable global offer to settle on April 28, 2022. She offered to settle on a final basis that the father pay child support in the amount of $687.00 per month and spousal support of $1,481.00 based on the father’s 2020 income of $73,619.00. The father did not accept this offer. On May 3, 2022 the father served an offer to settle to pay $678.00 per month and no spousal support that was not accepted by the mother.
[30] On August 3, 2022 the mother withdrew her offer to settle after having reviewed the partial disclosure provided by the father. It became clear that the father’s reported income was not reflective of his actual income.
[31] Given that the mother withdrew her offer to settle and did not serve an offer to settle on the temporary motion, the provisions of FLR 18 do not apply.
[32] Although the father’s offer to settle was not withdrawn, the order made by the court is much more favourable to the mother, so his offer to settle has no impact on the issue of costs.
[33] Counsel for the father has attached to his costs submissions numerous emails to prove that the father provided disclosure contrary to the findings in the decision on the temporary motion. As counsel submits that this is the issue on the appeal, it is properly dealt with on the appeal rather than having any impact on the issue of costs.
[34] Further, I am not prepared to defer the issue of costs until the appeal is adjudicated. If the appeal is allowed, then the justice hearing the appeal will address the costs that have been ordered. If the appeal is dismissed, then any cost order made will remain in full force and effect.
[35] I find that this was a somewhat complicated motion that was heard over two days and it was of extreme importance to the mother. As indicated the time spent and the hourly rate are reasonable.
[36] I find that an order that the father pay costs to the mother of $8,000.00 is reasonable and proportionate.
[37] As the issues only related to child support and spousal support, I find that it is appropriate that the cost order be enforced by the Family Responsibility Office as a support order.
Order
[38] There will be an order as follows:
- The Respondent Fabio De Souza shall pay the Applicant Ludmila Ferreira Pereira costs of $8,000.00 inclusive of applicable taxes.
- This order shall be enforced by the Family Responsibility Office as a support order.
- Support Deduction Order to issue.
Released: January 16, 2023 Signed: Justice Roselyn Zisman