CITATION: Danecker v. Danecker 2013 ONSC 5455
COURT FILE NO.: D22539/10
DATE: 2013-08-23
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Mark Stephen Danecker Applicant
– and –
Lise Anita Danecker Respondent
Kevin Robins, for the Applicant
Luigi De Lisio, for the Respondent
THE HONOURABLE JUSTICE T. MADDALENA
COSTS
[1] I heard this trial at Welland on July 11, 12, 13, and October 22, 23, 24, 25, 26, 2012.
[2] I released reasons for judgment on March 15, 2013.
[3] I have received and reviewed the following related to the issue of costs:-
i. The applicant’s written submissions on costs, received March 28, 2013;
ii. The respondent’s written submissions on costs, received April 15, 2013;
iii. The applicant’s reply submissions to the respondent’s submissions on costs, received April 19, 2013.
THE POSITION OF THE APPLICANT
[4] The parties settled, by way of minutes of settlement, at the beginning of trial, the issues dealing with their children, child support issues, and a substantial part of their financial and property issues. This left, therefore, the main issue for trial as the business valuation/equalization of their physiotherapy business, along with some minor adjustment issues to the equalization payment.
[5] The applicant made an offer to settle dated November 9, 2011 wherein the applicant was prepared to accept $150,000.00 in full and final satisfaction of the equalization of their net family property and for a full release of the applicant’s interest in the physiotherapy business to the respondent.
[6] The applicant states that he is the successful party as after a full trial the amount ordered to be paid by the respondent to the applicant to complete the equalization of their net family property was $145,448.57.
[7] The applicant submits that he should receive full costs after the offer of November 9, 2011 and 75% of his costs prior. The applicant submits the claim for all of his costs should be fixed in the amount of $53,880.86. This figure also includes 100% of all disbursements (inclusive of GST & HST).
[8] The applicant further submits the respondent acted unreasonably in that she took an unsubstantiated position with respect to the valuation of the physiotherapy clinic without producing an expert and also by relying on the “rule of thumb” value without calling an expert to give evidence at trial.
THE POSITION OF THE RESPONDENT
[9] The respondent submits that she was successful and claims costs since issues relating to the children and their custody, access, support and spousal support and some financial matters were resolved on the first day of trial.
[10] In the alternative, the respondent submits that there should be no order as to costs.
[11] The minutes of settlement filed the first day of trial did resolve many of the issues. The remaining equalization issues, although not agreed upon, were not complex or difficult. The respondent states that she did not act unreasonably in relying upon the “rule of thumb” valuation for the physiotherapy clinic.
[12] The respondent submits that if costs are awarded, they should be to her in the amount of $33,585.25 in accordance with the respondent’s counsel’s bill of costs.
ANALYSIS
[13] From the costs submissions of both the applicant and the respondent, the court notes that the rates charged by both counsel are reasonable given the level of experience of both counsel.
[14] Secondly, the court notes that from each of the bill of costs the time spent on the case, the drafting of documentation along with disbursements claimed are reasonable, given all of the issues.
[15] It is clear that minutes of settlement filed by the parties on the first day of trial resolved a large number of the issues, but left the main issue as to the equalization of the physiotherapy clinic and other adjustments to be determined.
[16] The eight days of trial revolved around the business, its value, and ultimately how the business was to be dealt with.
[17] The applicant provided a business valuation and called his expert to provide evidence which was most useful to the court. The respondent did not obtain a valuation but relied on a “rule of thumb” calculation but called no expert to substantiate the “rule of thumb” calculation.
[18] The offer to settle of the applicant dated November 8, 2011 had not been withdrawn at the time of trial. It offered to settle the issue surrounding the business by way of the applicant accepting from the respondent the amount of $150,000.00.
[19] The proposal of the respondent, not in the form of an offer in accordance with the rules was that the business was worth $175,000.00 and thus an amount of $87,500.00 would be owed to the applicant.
[20] Further, in correspondence of October 19, 2012, taking the other assets into consideration, the respondent’s offer was to keep the business and to pay to the applicant for his interest the amount of $67,302.50, less some further adjustments reducing the equalization payment to $44,965.00.
[21] After the eight days of trial, my judgment granted to the applicant an equalization payment inclusive of all the adjustments of $145,448.57 as owing by the respondent to the applicant.
[22] Rule 24(1) of the Family Law Rules provides a presumption that a successful party is entitled to costs. Further, Rule 24(11) sets out clearly the factors for the court to consider in an award of costs.
[23] In addition, Rule 18 deals with the costs consequences of the failure to accept an offer and the court’s discretion therein.
[24] Further, the Courts of Justice Act R.S.O. 1990 s.131(1) provides the court with a broad discretion when dealing with the issue of costs.
[25] The offer to settle dated November 8, 2011, had no expiry date. The respondent submitted no formal offer to settle in accordance with the rules. The offer to settle of the applicant was within $5000.00 of the judgment obtained at trial.
[26] The court held in the case of Feng v. Philips 2006 13769 (ON SC), [2006] O.J. No. 1708 (S.C.J.) as follows:
There must be some unusual circumstance, gap or other good reason to warrant circumventing Rule 24. Otherwise, the rule will have little meaning and the exception will become the rule . . . .
[27] Further, in the case of Wylie v. Leclair, (2003) 2003 49737 (ON CA), 64 O.R. (3d) 782 (CA), the Court of Appeal states as follows:-
It is an error to refuse to award costs to the successful party where the successful party has not behaved unreasonably during the case or success was not divided.”
[28] While both may have been somewhat successful in dealing with the minutes of settlement that were filed at the commencement of trial, there is no doubt the applicant has been substantially more successful than the respondent relating to the issues at trial and, therefore, costs should be awarded to the applicant.
[29] My decision, after the eight days of trial, was very close to the proposal for settlement put forward by the applicant in his offer to settle.
[30] The costs requested by the applicant, based on eight days of trial, along with the disbursements are reasonable. However, I would deduct from those costs an amount which attempts to fairly represent the fact that a number of issues were settled by both parties at the beginning of the trial by minutes of settlement and that it may be presumed in those minutes of settlement that there was a reasonable compromise by both parties.
[31] I calculate those costs to be $10,000.00 and thus award costs to the applicant payable by the respondent in the amount of $43,880.86 all inclusive.
Maddalena, J.
Released: August 23, 2013
CITATION: Danecker v. Danecker 2013 ONSC 5455
COURT FILE NO.: D22539/10
DATE: 2013-08-23
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Mark Stephen Danecker
Applicant
– and –
Lise Anita Danecker
Respondent
COSTS DECISION
Maddalena, J.
Released: August 23, 2013