COURT FILE AND PARTIES

COURT FILE NO.: D-20558-13

DATE: 20140703

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Tina Doris May Arlt, Applicant

AND:

Craig Walter Arlt, Respondent

BEFORE: The Honourable Madam Justice Louise L. Gauthier

COUNSEL:
Carol L. Hartman, for the Applicant

Jerome C. Gardner, for the Respondent

HEARD: July 2, 2014

ENDORSEMENT on costs

[1] On March 27, 2014, I heard the parties’ motion and cross-motion. I delivered my ruling on both on April 4, 2014.

[2] Save and except for the Respondent’s claim for joint custody, which was agreed to by the Applicant, the Respondent’s motion was denied.

[3] On June 19, 2014, the Applicant’s submissions on costs were delivered. I have received no costs submissions from the Respondent.

[4] The Applicant seeks costs on a full recovery basis, in the amount of $9,805.01, payable immediately by the Respondent. This is appropriate, she says, for the following reasons.

(a) A successful party in a family law proceeding is presumptively entitled to costs (Subrule 24(1) of the Family Law Rules.)

(b) Where a party is found to have acted in bad faith “the court shall decide costs on a full-recovery basis and shall order the party to pay them immediately.” (Subrule 24(8) of the Family Law Rules.)

(c) The Respondent should be sanctioned for his failure to accept a generous offer, for his failure to have made a timely disclosure of receipt of his bonus, and for proceeding with the litigation without having the evidence to establish his claims.

[5] I begin with the principle, embodied in subrule 24(1), that a successful party is presumptively entitled to costs. The Applicant was successful save and except with regard to the Monday and Thursday morning drop offs by the Respondent, and the claim for child support payable prior to the date of the Application. All of the relief claimed by the Respondent was denied, save and except for joint custody, which the Applicant was and had been prepared to agree to.

[6] The Applicant is entitled to costs.

[7] Subrule 24(11) provides that:

A person setting the amount of costs shall consider,

(a) the importance, complexity or difficulty of the issues;

(b) the reasonableness or unreasonableness of each party’s behaviour in the case;

(c) the lawyer’s rates;

(d) the time properly spent on the case, including conversations between the lawyer and the party or witnesses, drafting documents and correspondence, attempts to settle, preparation, hearing, argument, and preparation and signature of the order;

(e) expenses properly paid or payable; and

(f) any other relevant matter.

[8] The above factors are to be considered in the context of the purposes of costs rules. In Serra v. Serra, 2009 ONCA 395, [2009] O.J. No. 1905 (Ont. C.A.), the court stated that modern costs rules are designed to foster three fundamental purposes, namely to partially indemnify successful litigants for the cost of litigation, to encourage settlement and to discourage and sanction inappropriate behaviour by litigants bearing in mind that the awards should reflect what the court views as a fair and reasonable amount that should be paid by the unsuccessful party.

[9] While the issues were important to the parties, they were not particularly complex. The evidence established that there was an arrangement for the children’s care which had been in place for more than one year, whereby the Respondent had the children in his care under 34% of the time. There was no evidence to support the change to the arrangement proposed by the Respondent. The issue of child support also was not a complex one, although the section 9 C.S.G. threshold issue required a detailed analysis of the time the children spent with each parent. The balance of the issues (how to deal with the Respondent’s bonus, and the life insurance designation issue) were straightforward. Litigating the issues should not have been required.

[10] While I am not prepared to make a finding that the Respondent acted in bad faith, I am satisfied that he behaved unreasonably by forcing the litigation, by disregarding serious attempts to settle made by the Applicant, and by maintaining an untenable position with regard to the section 9 C.S.G. 40% threshold issue and the child support issue. Finally, there is the more troublesome issue of the Respondent’s bonus.

[11] The Respondent failed to disclose having received the significant sum of $19,326.60 on February 21, 2014. He did not disclose it in his Affidavit of March 24, 2014, and he allowed the court to be misled at the hearing of the motion itself when he failed to advise that he had received the bonus more than one month before the hearing. He did not disclose the information until some three weeks following the delivery of my ruling on the motion.

[12] The Respondent had not, as of the date of the Applicant’s submissions on costs, disclosed when he received his 2013 bonus. This continues to be relevant to the Applicant’s claim for child support for the year 2013. The failure to disclose this information is unreasonable.

[13] Family law litigants are responsible for and accountable for the positions they take in the litigation. Heuss v. Surkos, 2004 ONCJ 141 (Ont. C.J.). The Respondent’s conduct should be met with meaningful costs consequences. The Applicant should not be significantly out of pocket because of the Respondent’s failure to behave reasonably in the litigation. The preferable approach to costs in family law litigation is to have the costs recovery generally approach full recovery, so long as the successful party has behaved reasonably and costs are proportional to the issues and the result. See Biant v. Sagoo, 2001 28137 (ON SC), [2001] O.J. No. 3693, 20 R.F.L. (5th) (Ont. S.C.J.).

[14] The Applicant made meaningful efforts to resolve all issues well in advance of the hearing of the motion, and in advance of the bringing of the motion. The settlement proposal, made two days following the case conference, closely resembles, in many ways, the Temporary Order which I made on April 4, 2014.

[15] I have reviewed the Applicant’s counsel’s Costs Outline. A considerable amount of time was spent by counsel in connection with the section 9 C.S.G. threshold issue and the calculation of the time spent by the children with each of the parents. Although the onus of establishing that the threshold has been met was on the Respondent, it was the Applicant’s material that provided the required information for the entire 2013 period.

[16] While the amount sought for costs may appear excessive for a motion, the issues raised and the evidence required to address those issues go a long way to justifying the time counsel spent on this case.

[17] In all the circumstances, and considering the factors outlined in subsection 24(11) and the guidance offered in Serra v. Serra, I fix the costs of the motion and the costs submissions at $7,500 inclusive of fees, disbursements and H.S.T. They are payable by the Respondent within 30 days.

The Honourable Madam Justice Louise L. Gauthier

Date: July 3, 2014