COURT FILE AND PARTIES

COURT FILE NO.: F1583/97

DATE: 2013-11-28

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Tracy Lee Lawder-Windsor, Applicant

AND:

Christopher Mark Windsor, Respondent

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

COUNSEL:
Applicant – self-represented

Michael Wilson - Counsel, for the Respondent

COSTS ENDORSEMENT

[1] The parties have delivered their written costs submissions as directed in my Endorsement released September 20, 2013.

[2] The following is my disposition with respect to the costs of the motion.

Guiding Principles

[3] Pursuant to subrule 24(1) of the Family Court Rules, the successful party is presumed to be entitled to recover costs. Subrule 24(11) requires the court, in setting the amount of costs, to consider a number of factors including the importance, complexity and difficulty of the issues, the reasonableness or unreasonableness of each party's behavior in the case, the lawyer’s rates, the time properly spent on the case, expenses properly paid or payable, and any other relevant matter. These factors are to be applied flexibly (see C.A.M. v. D.M. (2003), 2003 18880 (ON CA), 67 O.R. (3d) 181 (C.A.) at para 42).

[4] Rule 18 deals with the impact of Offers to Settle which may have been served by the parties on the costs determination. Subrule 18(14) provides that a party who makes a written offer at least seven days before the trial, and obtains an order as favorable as or more favorable than the offer, is entitled, unless the Court orders otherwise, to costs to the date that the offer was served and full recovery costs from that date. Even if subrule (14) does not apply, the Court may, under subrule 18(16), take into account any written offer to settle served by a party, the date the offer was made and its terms.

[5] Consideration of the relative success of the parties on the issues in the case is the starting point in determining costs (see Butty v. Butty 2009 23111 (ON SC), [2009] O.J. No. 1887 (SCJ) at para. 4, citing Sims-Howarth v. Bilcliffe 2000 22584 (ON SC), [2000] O.J. No. 330 (SCJ)). In the case of Johanns v. Fulford 2010 ONCJ at para. 13 it was held that, for the purpose of Rule 24(1), “success” is assessed by comparing the terms of an order against the relief originally requested in the pleadings and against the terms of any offers to settle.

Positions of the Parties

[6] The Respondent seeks costs on a full recovery basis in the sum of $41,872.66, comprised of fees of $36,117.50, disbursements of $937.95 plus HST. In the alternative, he seeks partial indemnity costs to the date of his Offer to Settle dated April 4, 2013, and full recovery costs thereafter, totaling $40,544.91 comprised of fees in the sum of $34,942.50 plus disbursements in the sum of $937.95 plus HST.

[7] The Respondent’s Offer to Settle called for spousal support to terminate effective April 30, 2013, with no order with respect to any retroactive support issues, including claims for indexing of spousal support or claims for overpayment of spousal support. The Offer provided that if it was accepted within seven days of service there would be no costs payable by either party, and, if accepted after seven days from the date of service, then the Applicant would pay the Respondent's costs on a partial recovery basis to the date of the offer and on a full recovery basis from the date of the offer forward.

[8] The Applicant argues that the Respondent was not completely successful, as the termination of spousal support was not made retroactive to the date sought, being April 1, 2011 and there was no order made to cease health benefits. She states that the costs sought by the Respondent are excessively high and that any complexity to the issues was caused by the Respondent and his counsel. The Applicant also submits that her financial circumstances should be taken into account. She says that she is not in a financial position to pay all or a portion of any costs award. She is currently unemployed and there is no guarantee that her income at her next place of employment will be at the same level as at her former employer. She also states that she has no assets.

Analysis

[9] There is no question that the Respondent was the successful party on the motion. Success was not divided. Although the Respondent claimed that spousal support should be terminated effective April 1, 2011, in the alternative, he claimed termination effective at such other date as the Court would deem just, or in the further alternative, that it be varied to provide for a termination date and/or to lower the quantum. The Respondent did not separately claim termination of health benefits, but rather claimed termination of "all incidents of spousal support".

[10] There is also no question that the Order made was as favorable as the Offer to Settle, recognizing that it called for termination of spousal support effective at the end of the month that the offer was served, and provided for no costs if the offer was accepted within seven days.

[11] Accordingly, as a starting point, the Respondent is presumptively entitled to the costs of the motion pursuant to Rule 24(1) and is entitled, unless the court orders otherwise, to costs to the date the offer was served and full recovery costs from that date pursuant to Rule 18(14). It is noted that although the Respondent has satisfied the requirements of both Rules 24(1) and 18(14), neither rule requires the Court to make a costs award (see Murray v Murray (2005) 2005 46626 (ON CA), 205 O.A.C. 107 (C.A.) at para. 9).

[12] The Court of Appeal in C.A.M. v. D.M. at para. 42 confirmed that the financial situation of the parties can be taken into account in setting the amount of costs award, either under Rule 24 or Rule 18. Under Rule 24(11) a number of factors that must be considered are enumerated, including "any other relevant matter," and a consideration of particular relevance may be the financial position of the parties.

[13] Moreover, as pointed out at para. 43 of C.A.M. v. D.M., the Court has a discretion not to make an award of full recovery even where the party has met the conditions in Rule 18(14), as the rule specifically provides that "unless the court orders otherwise" the party is entitled to full recovery. A relevant consideration would be the financial conditions of the parties.

[14] These principles drawn from C.A.M. v. D.M. referred to above were reinforced in Murray.

[15] I am prepared to accept that an award of costs of the magnitude sought by the Respondent would impose a great, or even crippling, financial hardship on the Applicant. This is particularly relevant in this case where the order to terminate spousal support on the review, was founded on a determination that the Applicant had been successful in achieving financial self-sufficiency. In Murray the Court of Appeal noted that "this is a case in which a costs award would have a devastating effect on [the wife] - it would likely destroy whatever chance she may have to achieve financial self-sufficiency.” To impose an order for costs at the level sought would, in all likelihood, seriously undermine or destroy the self-sufficiency which the Applicant has been able to achieve, and which justified the making of the order to terminate spousal support payable by the Respondent.

[16] Although the case law requires the Court to consider the means of the parties, the limited financial resources of the party does not necessarily afford immunity from a costs order, but, may affect the scale or quantum of costs (see Parsons v. Parsons (2002), 2002 45521 (ON SC), 31 R.F.L. (5th) 373 (Ont. S.C.J.) at para. 12).

[17] Importantly, the case law directs that a costs award must represent a fair and reasonable amount that should be paid, rather than any exact measure of the actual costs, must be consistent with what the unsuccessful party might reasonably have expected to have to pay, and must reflect some form of proportionality to the actual issues argued, rather than an unquestioned reliance on billable hours and documents created (see Mason v. Smissen [2013] O.J. No. 4229 (S.C.J.) at paras. 5 and 6 and the cases therein referred to).

[18] It is observed that the Respondent's Bill of Costs does not lay out the attendances of counsel at various steps of the proceeding, as would be considered customary, but rather simply sets forth totals for fees, disbursements and HST and appends 10 pages of time dockets in fine print. The Court is therefore somewhat hampered in evaluating what was done and how much time was expended at each step.

[19] Although the motion was argued in less than a day (closer to half a day), the total number of hours claimed for attendances by counsel is 129.10, plus 12.3 hours for a legal assistant. Although, in his submissions, the Respondent outlines the complexities that were involved, by any measure, the amount of time expended, and the amount claimed for costs, far exceed what would be considered to be within the reasonable expectations of the losing party, and are out of proportion to the issues involved. The fee portion claimed is equivalent to 3 ¾ years of spousal support payable under the original order which was under review. It may be that, as between counsel and client, an expenditure of time at those levels is fully justified, however, that does not necessarily translate into an appropriate amount of a costs award against the opposing party.

[20] In my view, in the exercise of my discretion, taking into account the factors referred to above, an appropriate costs award would be $8,000 in respect of fees, disbursements in the sum of $937.95, plus HST on the fees and on the actuary report in the sum of $1,105, totaling in all the sum of $10,042.95.

Disposition

[21] For the reasons set forth above, it is ordered that the Applicant pay to the Respondent costs fixed in the sum of $10,042.95. This amount is to be paid within 30 days of the date hereof.

D. A. Broad J.

Date: November 28, 2013