Superior Court of Justice - Ontario

COURT FILE NO.: 47939-13

DATE: 2014-07-02

RE: Dale Marie Livingston, Applicant/Moving Party

AND:

Lance Sheldon Livingston, Respondent/Responding Party

BEFORE: The Honourable Mr. Justice G. A. Campbell

COUNSEL:
Hillary A. Houston, for the Applicant/Moving Party

Benjamin J. Clark, for the Respondent/Responding Party

HEARD: June 4, 2014

Costs ENDORSEMENT

[1] This motion consisted of three areas for consideration and the successful party, Ms. Livingston seeks an order of costs of $30,974.90, inclusive.

[2] The first, and by far and above the more important issue, was spousal support quantum and its start date. Obviously, retroactive spousal support from separation to at least the Application date or to the date of the motion for relief is usually and regularly reserved to the trial judge. This case was no different.

[3] However, what was (very) different was that Mr. Livingston had allowed Ms. Livingston to obtain and use (in addition to her own share) his one-half share of the net proceeds from the sale of the matrimonial home ($52,415.00). The rather unique circumstance that faced the court was that all counsel insisted that I not consider that $52,415.00 as either a pre-payment of an equalization that may eventually be owing, nor as a lump sum payment of spousal support or arrears thereof by Mr. Livingston to Ms. Livingston.

[4] In the end, as directed I did not take that money into account at all when arriving at my decision.

[5] The result of following those directions and ignoring that payment creates a very strange set of circumstances. I am aware that Ms. Livingston did indeed receive and use the money which Mr. Livingston was not ordered to make available, but as a result of knowing that he had done so and she had had the benefit of that sizeable asset, he stopped paying any spousal support to Ms. Livingston from June 1, 2013. Accordingly, I ordered spousal support to be paid by him from that earlier date.

[6] Ms. Houston made much of Mr. Livingston’s decision to stop spousal support over a year ago and to instead direct his money into an investment property to house (for free) his current partner’s extended family, as well as to not require his current partner to contribute anything to their daily expenses for housing, food, etc., despite her earning an income from her own business. It is obvious from my decision that it appeared that Mr. Livingston had replaced the former Ms. Livingston’s needs for those of his current partner, even to the extent of reducing Ms. Livingston’s share of his current life insurance coverage and replacing her with his current partner.

[7] After reading the various Offers to Settle there is little question that Ms. Livingston won the spousal support issue, hands down. As provided by s. 24(1) of the Rules, Ms. Livingston is presumed therefore to be entitled to her costs. The issue to be decided then is the extent or quantum of what costs order would be reasonable, fair, balanced and proportional in these circumstances.

[8] The child support issue was a “follow-on” issue. Thanks to the guidelines, it was neither complex nor difficult. Indeed, once the major threshold issue of spousal support (and its start-date) was decided, the child support issue followed automatically.

[9] As well, the cross Motion to Strike was procedural. Mr. Livingston won that issue, despite Ms. Houston’s effort to save the offending sentences in her affidavit. In this regard, I agree with Mr. Clark that Mr. Livingston should be granted his very reasonable costs sought of $720.38, as a set-off against the larger spousal support costs order.

[10] I accept Ms. Houston’s challenge of her opposing colleague that if he wanted to strenuously (and successfully) object to the amount of time, effort and bills rendered by her firm for the time invested on the motion, the McKenzie Lake team needed to disclose to the court the extent of their own effort and their bills to their own client in order that a comparison could be made to prove the validity of their submission that the quantum of costs sought by Ms. Houston was indeed “exorbitant” and “unreasonable”.

[11] I also accept Ms. Houston’s assertion at page 4 of her written submissions that:

The Respondent would have achieved a far more favourable result had he accepted the Applicant’s Offer to Settle. His failure to do so resulted in the payment of a higher quantum of support for a longer duration and the resulting higher arrears being paid within 60 days rather than over 10 months as provided in the Applicant’s Offer to Settle. The result achieved by the Applicant considerably exceeded the terms of the Respondent’s Offers to Settle.

[12] I am also guided (but do not accept wholly) by two other of Ms. Houston’s submissions namely;

a) That Ms. Livingston should be entitled to her substantial recovery costs to May 15, 2014 and full recovery of her costs to and including the June 4, 2014 attendance and argument. (Less Mr. Livingston’s set-off award of $720.38 and less that portion of Ms. Houston’s research and preparation to argue against the court striking out the offending portion of her client’s affidavit);

b) That the court should allow travel-time for counsel from/to London and Kitchener.

[13] Normally, I do agree with Mr. Clark’s submission, that travel time from remote cities to the litigation location should not be allowed, as can be seen by my decision found in Czegledy-Nagy v. Seirli, (2011) ONSC 119 as follows:

a) If a litigant commences an action in his/her own community, it ill behooves him/her to retain counsel in the largest metropolitan centre in the Province (where fees are substantially higher per hour), than where the litigation is situate, then to ask that the court impose those higher costs and travel expenses upon the opposite party should he/she lose the motion.

b) While I recognize that modern legal practice has available to a client a team of legal staff, each contributing something to a motion, a losing litigant should not be expected to pay senior counsel supervising a junior counsel’s work or for the duplication of various lawyers “reviewing & revising” work already prepared (and billed to the client) by other lawyers or senior law clerks, or for the time counsel take to brief each other or their claw clerks to prepare simple court documents or arrange for service of same.

Professor Czegledy-Nagy may hire as many lawyers as he wishes to have on his team, from whichever city he wants them to come from. That is his prerogative. (See Grant v. Grant, 2006 CarsellOnt 17 (Ont. SCJ)).

However, no litigant should expect to drive up the cost of litigation in that manner for his/her own satisfaction or his/her need for attention and then to have the court saddle the other litigant with that bill.

There are many very competent local counsel (some are even LSUC family law “specialists”) in this Region. The need to import another from afar is unnecessarily indulgent.

In any event, the Court need only consider as one factor the amount that a successful litigant has expended to achieve success. Some litigants need more “hand-holding” than others and some counsel bill heavily for the slightest effort where others do not.

Therefore, despite Prof. Czegledy-Nagy spending almost $65,500.00 to get a temporary order (which required two attendances on motions), the principle of reasonableness that directs my determination is whether a reasonable party, opposing Prof. Czeglefy-Nagy’s motions could possibly anticipate an order for costs against her even approaching such a breathtaking quantum, were she to lose those motions.

Despite my colleague, Wood J.’s view, expressed in Grant (supra) that losing litigants in centres outside of Toronto should be ready to face “Toronto rates” if their opponent hired a Toronto “Carriage Trade” Counsel, my view is that Dr. Seirli could not possibly anticipate being held responsible for the gargantuan costs order as sought.

[14] In this case, since all counsel for both parties were out-of-town counsel and “had been on the case” for years, neither litigant would be saddled with an extra expense for travel time unexpectedly. Accordingly, in this case travel time becomes an expense that the unsuccessful party ought “reasonably to have expected to pay” see Moon v. Sher (2004), 2004 39005 (ON CA), 246 D.L.R. (4th) 440, [2004] O.J. No. 4651 (C.A.).

[15] Further, despite Mr. Clark’s submission, I am unpersuaded by Mr. Livingston’s “hardship” argument, nor am I willing to direct that this costs order be paid by Mr. Livingston “via a credit against the Applicant’s obligation to contribute to the post-secondary expenses for the parties’ daughter and any remaining balance paid at the conclusion of this proceeding.”

[16] Firstly, no such “obligation” exists at present. Second, should Nicole actually register and attend a post-secondary educational institution, s. 7(2) of the Child Support Guidelines only requires a sharing of the net expenses (after deducting any OSAP/RESP/bursary/grant amounts) among three people; Nicole, Ms. Livingston and Mr. Livingston. After that s. 7(2) exercise has been completed, I am not sure that there will actually remain any post-secondary education expense that require contribution from Ms. Livingston.

[17] Third, litigation is a very expensive undertaking and unless lawyers are willing to allow themselves to bank-roll their clients cases (and, like contingency arrangements, wait to the end of the case to get paid) for me to require Ms. Livingston to wait to the end of her litigation to re-coup her costs incurred to get to that end creates two effects:

a) It allows Mr. Livingston to litigate without immediate financial consequence for any ill-advised tactics that he might conjure during the life of the case, and

b) It encourages Mr. Livingston to draw-out the end result over a longer period of time if he is facing a large costs obligation in the end.

[18] In my view, judges should not knowingly (indirectly or directly) contribute to lengthening litigation. The court process is already rightly criticized for its length and cost. Litigation should be a pay-as-you-go undertaking, so that litigants are required to ante-up or pay for their intransigence or refusal to accept reasonable offers to settle when they occur and not on some far off Judgment Day (see Rule 24(10)).

[19] In sum, one cannot challenge Ms. Houston’s submission that her client achieved complete success on the largest and most important issue before the court on June 4. Ms. Livingston’s Offer to Settle, had it been accepted would have resulted in a lesser quantum of spousal support that Mr. Livingston is now ordered to pay. Of course, he is certainly entitled to vigorously contest the claims advanced against him, and he did so to the fullest. Unfortunately, as a result of that decision, Ms. Livingston was thereby forced to incur significant expense in her very successful quest for interim relief. As a result as well, Mr. Livingston has now saddled himself with a very sizeable cost obligation to her.

[20] The case law encourages me to view a costs decision in a summary, flexible and balanced manner, recognizing the wide discretion afforded by Rule 24 of the Rules: see Ostapchuk v. Ostapchuk, 2003 57399 (ON CA), 2003 CarswellOnt 1661, [2003] O.J. No. 1733 (C. A.). A costs award must as well represent a fair and reasonable amount, rather than any exact measure of actual costs incurred to achieve the result: see Zestra Engineering Ltd. V. Cloutier, 2002 25577 (ON CA), [2002] O.J. No. 4495 (C.A.). The costs decision must as well reflect some form of proportionality to the actual issues argued, rather than an unquestioned reliance on billable hours and documents created: see Pagnotta v. Brown, 2002 CarswellOnt 2666 (Sup. Ct.) and Gale v. Gale, (2006) CarswellOnt 6328.

[21] In this case, the extreme divergence in the parties’ incomes thus allowing Mr. Livingston to litigate more freely than Ms. Livingston needs to be rectified. Mr. Livingston’s decision on one hand to offer $52,000 to Ms. Livingston then on the other, refuse to meet his obvious obligation for periodic spousal support forced Ms. Livingston to bring her motion to “level the playing field”. He must surely have anticipated that his strategy left Ms. Livingston only two options: to acquiesce or to bring a motion for relief from his gambit. She chose the latter and by then refusing her reasonable offer, Mr. Livingston has now created his own financial dilemma.

[22] Ms. Livingston made a reasonable offer to settle. Mr. Livingston’s responding offer was not close enough. In hindsight, he should have settled. He didn’t. As a result, the Rules provide that he is now obliged to pay for that decision.

[23] After examining the factors set out in Rule 24(11) and applying them to the circumstances, positions, offers and tactics of this proceeding and using the “flexible v.s. rigid adherence to hours billed times the hourly rate charged” approach set out by the case of Hackett v. Leung 2005 42254 (ONSC) Blishen, J. and the “fair and reasonable amount” approach encouraged by Boucher v. Public Accountants Council, 2004 14579 (ON CA), [2004] O.J. No. 2634, OCA, I find that a reasonable, balanced and fair costs order to recognize the Applicant’s success is $18,000.00, inclusive of recoverable disbursements and HST. I arrive at this amount after deducting $720.38 for Mr. Livingston’s costs allowed for winning his motion to strike and by removing a sizeable portion of Mrs. Houston’s time, effort and research to prepare her argument against that cross-motion. This costs order is payable by the Respondent to the Applicant, forthwith.

[24] All of these costs were incurred with respect to the order for support. They are “legal fees or other expenses arising in relation to support or maintenance” and as such, should be enforceable by the Director of F. R. O. (see s. 1(1)(g) of the Family Responsibility and Support Arrears Enforcement Act 1996, S.O. 1996, c. 31 (as amended) and Wildman v. Wildman (2006), 82. O.R. (3d) 401 (C.A.)).

[25] I so order.

G. A. Campbell J.

Date: July 2, 2014