COURT FILE AND PARTIES
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Janusz Kozicki, Applicant
AND:
Wieslawa Kozicki, Respondent
BEFORE: Kiteley
COUNSEL: Marek Z. Tufman, for the Applicant
Natalie Derbyshire, for the Respondent
HEARD: In writing
ENDORSEMENT AS TO COSTS OF MOTION HEARD NOVEMBER 7, 2013
1In an endorsement dated December 31, 20131, I made various orders dealing with disclosure, child support and interim disbursements. At paragraph 74, I directed counsel to make written submissions not exceeding 3 pages plus costs outline together with offers to settle if any; the Respondent by January 17 and the Applicant by January 31st.
2On January 17, 2014, I received a brief from counsel for the Respondent that included written submissions, prior endorsements, a letter to Mr. Tufman dated January 9, 2013 which proposed terms of adjournment of the imminent motion, a letter to Mr. Tufman dated August 28, 2013 with respect to the motion scheduled for November 25, 2013, and offers to settle dated April 23, 2013 and October 8, 2013 and October 21, 2013. Counsel also provided a bill of costs which reflected a claim for full indemnity costs in the amount of $76,098.93 and partial indemnity costs in the amount of $50,732.21. Based on the success achieved, the Respondent’s positive conduct, the Applicant’s unreasonable conduct and bad faith, success achieved and the offers to settle, she requested full recovery costs.
3On January 31, 2014 I received a brief from counsel for the Applicant that included written submissions, a copy of the index to the two volumes of disclosure made by the Applicant, letter dated December 12, 2013 to Ms. Savin that listed the status of disclosure that I had required to be provided by December 13, 2013, copies of 5 letters sent to counsel for the Respondent between March 29, 2012 and October 3, 2012 repeatedly inquiring whether Samantha was still in school (and therefor child support should be paid), a copy of what is stated to be an affidavit of the Applicant dated January 20, 2014 filed in response to the motion by the Respondent returnable January 28, 2014, a copy of a letter dated January 24, 2014 to counsel for the Respondent with respect to adjourning the imminent motion dealing with sale of the rental property to which the Applicant had agreed on November 7, 2013. In his submissions, counsel for the Applicant agreed that the Respondent was more successful and that she should recover costs on a partial indemnity basis. He noted that while the Respondent was more successful, he repeated the position he had taken on the motion, namely that the Applicant, who is an uneducated labourer with limited ability in English, had tried to do his best to produce as much disclosure as possible and the Respondent had behaved unreasonably in the scheduling and other procedural aspects of the motions. He expressed his opinion that the bill of costs was “outrageously excessive”. It was his submission that an order for costs in the amount of $10,000 plus HST, plus disbursements in the amount of $831.89 would be appropriate.
4In the timetable I established, I did not provide for reply submissions. However, on February 5, 2014, I received another brief from counsel for the Respondent which included a reply to Mr. Tufman’s written submissions, a letter to Mr. Tufman dated October 22, 2013 addressing the consolidation issue, a copy of the confirmation form which had been sent on behalf of the Respondent for an adjournment of the April 25, 2013 motion, letters dated November 26, 2013 and December 3, 2013 on the reinstatement of the civil action referenced at paragraph 65 of the earlier endorsement, a copy of the proposed listing agreement with respect to the sale of the rental property to which the Applicant had agreed on November 7 which apparently had the Applicant’s signature but not the Respondent’s signature and a copy of an email dated January 18th confirming that the Applicant had signed the listing agreement, a copy of an email from the listing agent to the lawyer for the Respondent dated December 13, 2013, a copy of a letter dated January 21, 2014 to Mr. Tufman on the subject of the listing agreement and the pending motion brought on behalf of the Respondent to ensure compliance with the order I made on November 7, 2013 (referenced at paragraph 8 of the earlier endorsement), and a letter dated January 24, 2014 to counsel for the Respondent confirming that the real estate agent had the keys to the property.
5On February 7, 2014, I received another brief from counsel for the Applicant which was an answer to the reply submissions. This brief contained responses to 11 of the 12 paragraphs contained in the Respondent’s reply brief as well as copies of 3 letters to the court or to counsel for the Respondent all dated April 23, 2013 on the subject of the then pending motion, a copy of a letter to Ms. Savin dated July 19, 2013 about an adjournment of the then pending motion, a letter to Master Dash dated June 25, 2013 on the subject of a status hearing on the civil matter scheduled for June 27, 2013, a letter to counsel for the Respondent dated November 13, 2013 proposing a timetable for the trial of the actions together which I had anticipated in paragraphs 63 and 64 of the earlier endorsement, and a confirmation form sent by counsel for the Applicant that the motion brought by the Respondent returnable January 28, 2014 would be adjourned on consent to March 18, 2014 with counsel’s editorial comment about the merits of the motion and the reason for the adjournment.
6I have reviewed the materials because they demonstrate the following: a chasm between the parties as to reasonable expectations as to the outcome of the motion; vastly different perspectives on who did what with respect to substantive issues and procedural issues; continued assertions of fault against the other party; references to events and evidence after the hearing of the motion on November 7, 2013 including compliance or lack thereof, none of which is relevant to costs of the motion. It appears that the intractable disputes between the parties (and the family of the Respondent as reflected in the civil action) are not likely to be resolved any time soon. Unfortunately the parties are spending valuable resources on the litigation which should be used for Samantha’s education.
7I do not intend to review the submissions in detail. Rule 24(10) requires the court to decide costs of each step “in a summary manner”. The multiple submissions are not consistent with that expectation.
8Pursuant to rule 24(1), the successful party is presumed entitled to costs. The Respondent was successful. Because the Applicant consented to an order for sale of the jointly owned rental property and had provided some disclosure, his counsel minimizes the extent of the success. I doubt that the Applicant would have provided the disclosure he did provide or consented to the sale of the jointly owned rental property or paid proper child support if the Respondent had not brought the motion. His acquiescence on the morning of the motion to consent to the sale and to provide further disclosure (subject to the date which I ordered) does not mean that she was anything less than successful on those issues. On the issue of the income to be imputed to the Applicant, the Respondent was successful in that I attributed a yearly income of $53,076 which reflected his annualized expenses. The Respondent was not successful in obtaining an order that I impute income of $75,776 but she was successful in achieving an order that did impute income rather than accepting his evidence; and she was successful in obtaining an order almost doubling his line 150 income from 2012. She was also successful in obtaining an order for arrears of child support and for s. 7 expenses. Lastly, she was successful in obtaining an order for interim disbursements.
9Pursuant to rule 24(4), the court may deprive a successful party of costs where she has behaved unreasonably. I do not intend to make determinations as to the reasons for the adjournments of motions and the timetable for delivery of materials. Suffice it to say that I am not satisfied that any behaviour of the Respondent was unreasonable. I observe that, as an indicator or reasonableness, only the Respondent made any offer to settle.
10Pursuant to rule 24(8), the court is required to order costs on a full recovery basis if a party is found to have acted in bad faith but I am not persuaded that the Applicant has acted in bad faith.
11Rule 24(11) lists factors relevant in setting the amount of costs. The issues were important in directing the Applicant to comply with his obligation to provide disclosure, to properly pay child support including arrears, and to sell a jointly owned property which he had resisted doing except on his conditions. The issues were not particularly complex or difficult.
12While I do not find that the Applicant was acting in bad faith, I do find that his behaviour was unreasonable in his resistance to disclosure, his less than organized disclosure when it was provided which increased the workload for the Respondent’s counsel, his refusal to agree until the morning of the motion which necessitated counsel having done all the preparation for all of the issues in the notice of motion. As indicated in paragraph 29–30 of the earlier endorsement, his repeated insistence about having made comprehensive disclosure when he had not done so had the not surprising effect of creating conflict and provoking counsel for the Respondent to conclude he had hidden income. I signaled in paragraph 31, that I anticipated submissions as to costs on this point. The Applicant’s unreasonable behaviour increases his costs exposure.
13Pursuant to rule 18, there are cost consequences of making offers to settle. In her offer to settle dated April 23, 2013, the Respondent proposed child support in the amount of $546 per month commencing December 1, 2012 based on imputed income of $60,000 and he would pay 60% of retroactive post-secondary expenses and 60% going forward. The jointly owned rental property would be listed for sale with the proceeds held in trust and the interest penalty would be paid from the Applicant’s share. The Applicant would produce outstanding disclosure by May 25, 2013.
14In her October 8, 2013 offer, the table amount of child support was the same, the arrears of s. 7 expenses had increased, and he would pay ongoing s. 7 expenses at 60%. In other words, the offer focused only on child support issues.
15In the October 21, 2013 offer, the table amount of child support was the same, the arrears of s. 7 were the same, he would pay ongoing s. 7 expenses at 60%; the jointly owned rental property would be listed for sale and the proceeds would be held in trust and the interest penalty would be paid from the Applicant’s share; the Applicant would produce specified disclosure by December 8, 2013.
16The Respondent did not achieve the table amount of support she sought ($546) but did recover $479. She asked that income of $60,000 be imputed and the order imputed $53,076. The order for arrears took effect December 1, 2012. The ratio of s. 7 expenses in the order was 70/30, which was more favourable to the Respondent than her offer. The Applicant acquiesced on the morning of the motion with respect to the sale of the jointly owned property and disclosure.
17The settlement position taken by the Respondent was very reasonable and the offers were timely. I am satisfied that the requirements of rule 18(14) have been met and that the order is globally as favourable as were her offers to settle. As a result, full recovery of costs from the date of the offer dated April 23, 2013 is appropriate.
18As for other factors in rule 24(11), I am satisfied that the lawyer’s rates and the time spent were largely appropriate in the circumstances of this case.
19Pursuant to rule 24(11), the court must consider “any other relevant matter” which typically requires the court to consider the issue of proportionality: what amount would be in the reasonable expectations of the parties. I have found that the behaviour of the Applicant was unreasonable and that that increased the work that had to be done and therefore the Respondent’s costs. However, I cannot conclude that substantial indemnity or full recovery costs in the amount of $76,098.93 is proportional to the issues nor is it within the contemplation of the parties in the context of a motion for child support, disclosure, interim disbursements and sale of a jointly owned property.
20I do not intend to review the detail of the bill of costs. Taking into account all of the forgoing and the reservation of costs by Stevenson J. on October 15, 2013, I find that a reasonable amount on account of fees, disbursements and HST for these motions is $30,000.
ORDER TO GO AS FOLLOWS:
21The Applicant shall pay costs to the Respondent in the amount of $35,000 on these conditions:
(a) out of his share of the proceeds of sale of the jointly owned property; or
(b) in any event, not later than 90 days before the date set for trial of this action.
Kiteley J.
Date: April 30, 2014