ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 06-1012
DATE: 2014/09/18
BETWEEN:
Vivianne Jeannine Allaire (Lavergne)
Applicant
– and –
Jacques Louis Lavergne
Respondent
Self-represented
Patricia Lucas, counsel for the Respondent
HEARD: Written submissions
RULING ON COSTS
laliberte, j.
INTRODUCTION
[1] On July 28, 2014, the Court released reasons for judgment in this matter. The parties were asked to resolve the issue of costs. Being unable to do so, both filed written submissions on August 29, 2014. Therefore, the question of costs will be decided by the Court.
[2] The Applicant is of the view that the parties should bear their own costs. She relies on the following:
− Success was divided;
− Quantum of spousal support and the applicability of the SSAG’s required judicial adjudication;
− She was more successful on the question of contribution towards their son’s post-secondary education;
− The offers made by the Respondent were tendered on an all or nothing basis and each contained terms which were unacceptable;
− She does not have the ability to pay costs;
− She raises concerns with the Applicant’s bill of costs.
[3] The Respondent seeks costs in the sum of $34,737.17. His position is that he made reasonable offers to settle which were more advantageous to the Applicant than the final order made. He claims his costs of the trial coupled with the settlement conference and trial management held in an effort to resolve matters.
[4] The issues for the Court are:
a) Is either party liable for costs?
b) What is the quantum of liability, if any?
THE LAW
[5] A proper determination of costs in family law proceedings requires the Court to reflect on a myriad of factors. It is more than a simple mathematical or mechanical exercise. (Boucher et al v. Public Accountants Council for the Province of Ontario 2004 14579 (ON CA), [2004] O.J. No. 2634 (Ontario Court of Appeal). As stated by the Ontario Court of Appeal in Somers v. Fournier 2002 45001 (ON CA), [2002] O.J. No. 2543 at paragraph 17:
“Thus, costs are both a discretionary indemnification device and a mechanism by which abuses of the Court’s processes may be deterred and penalized. Costs are routinely used by Ontario Courts to reward or sanction the conduct of parties prior to and during the litigation process…”
[6] The fundamental purposes of costs rules have been identified as follows:
To partially indemnify successful litigants for the cost of litigation;
To encourage settlement;
To discourage and sanction inappropriate behaviour by litigants.
Serra v. Serra 2009 ONCA 395, [2009] O.J. No. 1905 (Ontario Court of Appeal)
[7] The Court is bound to consider the framework set out in the Family Law Rules. While our Court of Appeal in C.A.M. v. D.M. 2003 18880 (ON CA), [2003] O.J. No. 3707 confirms a degree of discretion, “…It is apparent that the Family Law Rules have circumscribed the broad discretion…” which is granted to Judge’s under section 131(1) of the Courts of Justice Act.
[8] The Family Law Rules which are relevant to this matter are as follows:
Rule 2:
Court is required to apply rules to promote the primary objective which is to deal with cases justly
Parties and lawyers are required to help the Court promote this objective
Rule 18:
- The ramification of offers to settle made by a party
Rule 24:
24(1): The successful party is presumed entitled to costs.
24(2): The presumption of entitlement based on success may be rebutted if successful party acted unreasonably.
24(3): In deciding if a party acted unreasonably, Court considers:
➢ Behaviour in relation to issues from the time arose, including whether an offer to settle was made;
➢ Reasonableness of offer made;
➢ Any offer party withdrew or refused.
24(6): Costs may be apportioned in accordance with success.
24(8): Consequences of a party acting in bad faith.
24(11): In setting the amount of costs to be paid by the party who is found to be liable, the Court must consider:
➢ The importance, complexity or difficulty of the issues;
➢ The reasonableness or unreasonableness of party’s behaviour;
➢ The lawyers’ rates;
➢ The time properly spent on the case;
➢ Expenses properly paid or payable;
➢ Any other relevant matter.
[9] The Court must also be mindful of the parties’ relative ability to pay costs. As stated by the Ontario Court of Appeal in Harrington v. Harrington [2009] O.J. No. 827 at paragraph 8:
“We acknowledge that the Respondent’s offer to settle was much closer to the actual award than the Appellant’s. At the same time, we bear in mind other principles respecting the award of costs in family law matters such as ability to pay and the relative means of each party to bear his or her own costs.”
DISCUSSION
[10] The presumption is that the successful party is entitled to costs. In cases where a number of claims are made, success can be divided and the rules provide for allocation of costs according to the respective success of the parties.
[11] An offer to settle meeting the conditions set out in Family Law Rule 18 (14) is a significant factor in determining a litigant’s entitlement to costs.
[12] The Respondent sought to vary his monthly $7,000.00 spousal support obligation set out in the October 10, 2003 final order. His motion to vary was based on a change of employment resulting in a reduction in income. The Court’s finding was that this change in the Respondent’s means to pay spousal support amounted to a material change in circumstances. The monthly spousal support was set at $5,850.00 starting January 2010 resulting in arrears of $46,750.00 as of July 1, 2014.
[13] The Applicant had sought an increase in spousal support based on the Spousal Support Advisory Guidelines. For the reasons set out in its judgment, the Court felt that this was not appropriate.
[14] The presumptive rule attached to success favours the Respondent in regards to a variation of spousal support based on a material change in circumstances. While his position at trial was that he should pay $5,000.00 monthly, in the end, payments were reduced from $7,000.00 to $5,850.00.
[15] The Applicant requested a retroactive award for post-secondary expenses for the child Stephane born on July 15, 1988. Her position was that she had paid $148,361.07 for the support of the said child from 2010 to July 2012. Her claim was that the Respondent should share in these expenses.
[16] The Respondent’s suggestion at trial was that the Court had no jurisdiction to award a retroactive amount for child support since no claim was made while Stephane was “a child of the marriage” as defined under statute. However, he did not oppose making some contribution. The Court rejected the Respondent’s position that the Court lacked jurisdiction to deal with the issue of post-secondary expenses. The Court found that the obligation was grounded in the terms of Justice Lafrance-Cardinal’s order of February 22, 2010 which provides, in part,:
“In the event Stephane continues his post-secondary education…the obligation of the parties to support the child shall revive and the parties shall support the child retroactive to the start of the semester…”
[17] The Respondent’s submissions were that the award should be for $25,000.00.
[18] The Court found that the amount claimed by the Applicant was excessive and not reflective of expenses relating to post-secondary expenses. It was felt that $66,057.88 was a reasonable amount and that the Respondent should pay 75%. In the end, he was ordered to pay the Applicant the sum of $43,598.00.
[19] Based on pure arithmetics, the Respondent should be seen as the successful party. The Applicant’s claim for the payment of a proportionate share of $148,361.078 meant an award of $111,270.80 (based on 75%).
[20] Based on principles, the Applicant should be seen as having achieved some success in the Court’s finding that the entitlement is based on the Respondent’s legal obligation to pay retroactive post-secondary expenses as oppose to his lack of opposition.
[21] On balance, the Court is led to the conclusion that while both parties have had some success in this litigation, the presumption of success favours the Respondent.
[22] The Court has reviewed the offers to settle made by the parties in these proceedings. The Court comes to the following conclusions in regards to the significance of these offers on the issue of entitlement to costs:
− Both parties acted reasonably in making offers which they believed to be reasonable in the circumstances;
− Looking at each of the offers in their entirety, neither party obtained an order that is as favourable as or more favourable than the offers;
− On balance, the offers made by the Respondent come closer to the terms of the final orders on both issues raised; the Court notes however, that acceptance of either offers by the Applicant meant concessions on significant points such as foregoing two years arrears in spousal support and/or accepting $10,000.00 as lump sum payment for the post-secondary education expenses.
[23] As already discussed, relative success and “offers to settle” while significant considerations, are not solely determinative of entitlement to and quantum of costs. The Court considers that the issues raised in these proceedings were important and difficult. There is no indication that the party’s acted unreasonably.
[24] The reality is that an award for costs against the Applicant would result in hardship. The evidence before the Court is that her only sources of income are spousal support and $270.00 monthly from C.P.P. She is highly indebted and unable to meet her financial obligations. She has physical and mental ailments. The Court found that she is entitled to spousal support arrears of $46,750.00 and retroactive post-secondary education expenses for Stephane of $43,598.00. The Applicant is in dire need of these funds. The use of these amounts to set-off against a costs award would create hardship. The Court’s finding is that the Applicant does not have the ability to pay costs. The Respondent’s means as found by the Court are such that he is financially able to bear his own costs.
CONCLUSION
[25] The Court makes no award for costs in this matter.
Justice Ronald M. Laliberte Jr.
Released: September 18, 2014
COURT FILE NO.: 06-1012
DATE: 2014/09/18
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Vivianne Jeannine Allaire (Lavergne)
Applicant
– and –
Jacques Louis Lavergne
Respondent
RULING ON COSTS
Justice Ronald M. Laliberte Jr.
Released: September 18, 2014