DIVISIONAL COURT FILE NO.: D-06-0007
Court File No: 05-FA-013855FIS (Toronto Action)
Court File No: 06-4328 (Kenora Action)
DATE: 2006-09-27
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
B E T W E E N:
WENDY LEE GALE,
Elliot Birnboim, for the Applicant (Appellant)
Applicant (Appellant)
- and -
JOHN PAUL GALE,
Bernd Richardt, agent for Aaron Franks, for the Respondent (Respondent)
Respondent (Respondent)
HEARD: September 8, 2006, via teleconference, at Thunder Bay, Ontario
Mr. Justice G. P. Smith
Decision on Costs
[1] On June 23, 2006 I dismissed the wife’s application for leave to appeal the decision of Stach J. dismissing her motion for summary judgment on the issue of partition and sale of the jointly owned family cottage located near Kenora, Ontario. In my reasons I requested written submissions on the issue of costs.
[2] I have now received and reviewed those submissions and award costs to the husband in the amount of $7,000.00 for fees plus the sum of $1,487.09 for disbursements inclusive of G.S.T.
Reasons
[3] In Fong et al v. Chan et al,[^1] the Ontario Court of Appeal set out three fundamental purposes of modern cost rules:
(1) to indemnify successful litigants for the cost of litigation;
(2) to encourage settlements; and
(3) to discourage and sanction inappropriate behaviour by litigants.
[4] Rule 24 of the Family Law Rules states that there is a presumption that a successful party is entitled to the costs of a motion, enforcement, case or appeal.
[5] Rule 24(11) of the Family Law Rules sets out the factors to be considered in setting the amount of costs. These factors are:
the importance, complexity or difficulty of the issues;
the reasonableness or unreasonableness of each party’s behaviour in the case;
the lawyer’s rates;
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;
expenses properly paid or payable; and
any other relevant matter.
[6] In addition to the enumerated factors in Rule 24(11), one must always have in mind the overriding principle of reasonableness and the fundamental objective of preserving access to justice. The Ontario Court of Appeal in Boucher v. Public Accountants Council For The Province of Ontario[^2], albeit a case which was not a family law case, stated that the fixing of costs does not begin or end with the calculation of hours multiplied by rates. 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 party. The expectation of the parties concerning the amount of costs is also a relevant consideration.
[7] Although the Court of Appeal indicates that the setting of costs is not a mechanical calculation of hours multiplied by rates, the factors set out in Rule 24(11) do direct the court in coming to its decision to look at the time spent by the lawyer for the successful party and the rates of that lawyer
[8] With respect to the factors listed in Rule 24, this was not a complex or complicated matter nor can I say that any party acted unreasonably.
[9] In this case, there is no reason not to follow the presumptive rule that the husband should have his costs as the successful party. The issue is simply the quantum of those costs.
[10] The Bill of Costs filed by counsel for the husband asks for total fees of $14,831.50 and $1,487.09 for disbursements and G.S.T.
[11] The case is somewhat out of the ordinary in that the husband had two sets of counsel - Mr. Franks in Toronto and Mr. Richardt in Kenora. Mr. Franks seeks counsel fees of $375.00 and $400.00 per hour. Mr. Richardt sets out a counsel fee of $235 per hour for himself and $210.00 for Mr. Fregeau who is also of his firm. I accept that these hourly rates are reasonable given the experience of both sets of counsel however, on a partial indemnity basis, a rate of $250.00 for Mr. Franks and $175.00 for Messrs. Richardt and Fregeau would be reasonable.
[12] The concept of proportionality must be kept in mind when considering the issue of costs. This principle was considered in the case of Buchanan v. Goetel Communications Corp. [^3]where Ferguson J. had this to say at paragraphs 10 and 11 of that judgment:
Having said all that, the bottom line is that the proposed costs are excessive. They are excessive from two perspectives: costs of this magnitude will make litigation inaccessible as a method of dispute resolution; costs of this magnitude are also disproportionate to the value of the legal work necessary to represent a client in this dispute. If counsel do not use more restraint in deciding how much to invest in litigation, they will put both the bar and the Courts out of business which will profoundly harm the public whom we both serve.
[13] Mr. Justice Killeen in Pagnotta v. Brown[^4] has this to say about escalating costs and proportionality:
From my perspective, if lawyers wish to expend such grossly inordinate amounts of billable hours on relatively routine cases, they may feel free to do so subject to their client’s approval, but they cannot expect judges to encourage such inefficient expenditures of time when their costs are to be fixed following trial. Judges and assessment officers have a duty to fix or assess costs at reasonable amounts and in this process they have a duty to make sure that the hours spent can be reasonably justified. The losing party is not to be treated as a money tree to be plucked willy nilly by the winner of the contest.
[14] With respect to the concept of proportionality, I agree with counsel for the wife that the time expended on the motion is somewhat excessive. While it may be possible that there is some necessary overlap between Toronto and Kenora counsel, nevertheless, a Bill of Costs for a motion seeking leave to appeal in the amount of $16,318.59 is disproportional and on the high side.
[15] For the reasons set out above an order shall issue as awarding costs to the husband on a partial indemnity scale in the amount of $8,487.09 payable forthwith.
The Hon. Mr. Justice G. P. Smith
Released: September 27, 2006
DIVISIONAL COURT FILE NO.: 06-000007-ML
Court File No: 05-FA-013855FIS (Toronto Action)
Court File No: 06-4328 (Kenora Action)
DATE: 2006-09-27
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
B E T W E E N:
WENDY LEE GALE,
Applicant (Appellant)
- and –
JOHN PAUL GALE,
Respondent (Respondent)
DECISION ON MOTION
Patrick Smith
Released: September 27, 2006
/mls
[^1]: (1999), 1999 2052 (ON CA), 46 O.R. (3d) 330 [^2]: 2004 14579 (ON CA), 71 O.R. (3d) 291 (C.A.) [^3]: [2002] O.J. No. 3063 (Sup. Ct. Jus.) [^4]: [2002] O.J. No. 3033 (Sup. Ct. Jus.)