SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: 44717-10
DATE: 2013-07-10

RE: Jeffery James Dillon, Applicant

AND:

Lucia Dillon, Respondent

BEFORE: The Honourable Mr. Justice D.A. Broad

COUNSEL:
Paul D. Amey - Counsel, for the Applicant
Stephen Durbin - Counsel, for the Respondent

costs ENDORSEMENT

[1] The parties have now delivered their written submissions on costs as requested in my endorsement released May 29, 2013. The following is my disposition with respect to the costs of the Respondent’s motion for interim expenses.

[2] The Respondent’s motion originally sought leave to amend her Answer in order to add a claim against the trustees of the two trusts in which the Applicant is interested, as well as for interim expenses. The aspect of the motion seeking amendment of the pleadings was adjourned because the parties proposed to be added had not been served, and therefore the argument on the motion was limited to the Respondent’s claim for interim expenses.

[3] The Respondent sought an award for interim expenses to carry the matter through to trial in the sum of $100,000, and was successful to the extent of $27,000, being an estimate of costs to respond to the Applicant’s motion for summary judgment, without prejudice to her right to reapply for payment of further interim expenses in the event that the motion for summary judgment is dismissed.

Position of the Respondent/Moving Party

[4] The Respondent seeks an award of costs in respect of the motion on a full indemnity basis in the sum of $16,508.06, inclusive of disbursements and HST. Counsel for the Respondent cites the case of MacDonald-Sauer v. Sauer (2010) ONSC 2052 for the principle that "the preferable approach in family law cases is to have costs recovery generally approach full recovery so long as the successful party has behaved reasonably and the cost claims are proportional to the issues and the results" (see para. 44).

[5] The Respondent also argues that her request for interim expenses was of utmost importance to her and "wholly determinative of [her] position." She submits that the court ought to consider that the Applicant is in a stronger financial position than her as a relevant matter under para. (f) of Rule 24(11).

Position of the Applicant/Responding Party

[6] The Applicant argues that the costs of the motion for interim expenses should be fixed and reserved to final determination of the Application (effectively costs “in the cause”). With respect to the quantum, the Applicant argues that less than a full day of argument should be allowed as time was taken to deal with the question of service of the motion materials on the proposed added parties, and that preparation time should exclude time required for the Respondent's new counsel to familiarize himself with the file. He suggests costs on a partial indemnity basis of $6,000, comprised of $1,500 for argument of and $4,500 for preparation. He concludes by submitting that costs should not be awarded on a “full recovery” basis because no offers to settle were exchanged, the Respondent was not entirely successful having regard to the amount of interim expenses sought and it is premature to determine if the Applicant’s position on the motion was unreasonable.

Analysis

[7] Rule 24(1) provides that there is a presumption that a successful party is entitled to the costs of the motion, enforcement, case or appeal. In the case of Feng v. Philips, 2006 13769 (ON SC), [2006] O.J. No. 1708 (SCJ) Whalen, J. observed, at para. 19, that there must be some unusual circumstance, gap or other good reason to warrant circumventing Rule 24, as otherwise the Rule would have little meaning and the exception will become the rule.

[8] I am not persuaded that there is some unusual circumstance or other good reason in this case which would warrant a departure from the presumption in Rule 24 in favour of an order providing for costs “in the cause.” The Respondent, having been successful in achieving an award of interim expenses, should be entitled to costs of the motion.

[9] In setting the amount of the costs, the factors listed at Rule 24(11) are required to be considered. The range of factors is not closed, as paragraph 24(11) (f) requires consideration of "any other relevant matter.”

[10] Justice Turnbull noted in MacDonald-Sauer v. Sauer at para. 44, that, in exercising discretion on how much to award, “it is reasonable to look at the full amount claimed, the reasonableness of a party’s behaviour, the extent to which there is divided success, test the amount against the factors listed in Rule 24(11) and then look at factors such as ability to pay.”

[11] As indicated, the Respondent sought interim expenses through to trial in the face of the Applicant’s pending motion for summary judgment, a position which does not appear reasonable since, if the Applicant’s summary judgment motion is successful, there will be no realistic way for the Applicant to recoup the amount of the over-advance of interim costs to the Respondent. Moreover, the Respondent’s Costs Outline does not appear, on its face, to restrict itself to costs related to the motion for interim expenses. The motion to amend the pleadings to add parties has yet to be argued and there is no guarantee that it will be successful. It would therefore be inappropriate to include costs related to that pending motion in an award of costs in respect of the claim for interim expenses.

[12] In keeping with the direction in the case law, I would award costs of the motion to the Respondent on a substantial indemnity basis (claimed at $11,342 in respect of fees), reduced by $1,650.00 in respect of preparation related to the motion to amend the pleadings (25% of the preparation time claimed) and further reduced by $2,492 to $7,200 to account for the fact that the Respondent was successful for only a portion of the amount of interim expenses claimed. I allow the disbursements claimed in the sum of $505 as well as HST on the fee portion in the sum of $936 for a total of $8,641.

[13] I would not give effect to the Applicant’s submission that the costs should be limited to $6,000, particularly in the absence of inclusion in his costs submissions of his own Bill of Costs or Costs Outline. As Justice Turnbull observed in MacDonald-Sauer v. Sauer at para. 45, comparative information between the costs incurred by each party provides the court with some perspective in applying the “reasonable expectations" analysis called for in Boucher v. Public Accountants Council (Ontario), 2004 14579 (ON CA), [2004] O.J. No. 2634 (CA).

[14] The Respondent submits that the Applicant acted in bad faith in delivering his costs submissions prior to delivery of hers, as directed in my endorsement, and that I should take that into account in fixing costs. The actions of the Applicant in this respect appear to have been resulted from an error of judgment. Obviously care should be taken in a carrying out the directions of the Court with respect to delivery of costs submissions. However, I am not satisfied that counsel for the Applicant acted in bad faith as that term is understood in the case law. I would therefore not give effect to the Respondent's submission in this respect.

Disposition

[15] Is therefore ordered that the Applicant pay to the Respondent costs of the motion for interim expenses fixed in the sum of $8,641. Payment is to be made within 30 days of release of this endorsement.

D.A. Broad J.

Date: July 10, 2013