REASONS FOR DECISION ON COSTS

[1] I have reviewed the parties’ written submissions on costs.

[2] In family law proceedings costs are governed by Rule 24 of the Family Law Rules. Pursuant to Rule 24 there is a presumption that a successful party is entitled to the costs of a case. Further, a successful party who has behaved unreasonably during a case may be deprived of all or part of the party’s own costs or ordered to pay all or part of the unsuccessful party’s costs.

[3] Pursuant to rule 24(5) in deciding whether a party has behaved reasonably or unreasonably, the court shall examine,

(a) the party’s behaviour in relation to the issues from the time they arose, including whether the party made an Offer to Settle;

(b) the reasonableness of any offer made; and

[4] Pursuant to rule 24(6) if success in a step in a case is divided, the court may apportion costs as appropriate.

[5] Pursuant to rule 24(10) costs are to be decided at each step in the proceeding.

[6] Factors required to be considered in setting the amount of costs are:

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

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

(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.

[7] The starting point in my analysis must be determination of relative success. Success should be measured with reference to the parties’ respective offers to settle.

[8] I awarded sole custody of the children to the Applicant. This is consistent with the Applicant’s Offer to Settle dated October 18, 2014 which expired on October 29, 2014. The Applicant’s prior Offer to Settle on this issue dated September 26, 2012 required that the father’s access with the children be supervised and be restricted in terms of time. Another component of custody is decision making authority. In my judgment I ordered that the Applicant consult with the Respondent regarding major decisions affecting the general welfare of the children. The Applicant’s Offers to Settle did not contemplate any consultation with the Respondent regarding decision making pertaining to the children. On this issue, at least until the October 18, 2014 Offer to Settle, the Applicant’s position on settlement was unreasonable in pursuing supervised access by the Respondent. The Respondent, by his Offer to Settle dated November 4, 2014 (open for acceptance until one minute following commencement of the trial), sought joint custody of the children. The Applicant was successful on this issue but her Offer to Settle was only open for acceptance for a period of 11 days during which it might be argued that the Applicant would be entitled to full indemnity costs. The Applicant’s submissions do not assist me in determining what those costs during that time frame might be.

[9] The Respondent enjoyed a significant measure of success regarding the issue of decision making. This must temper the quality of the Applicant’s success on the issue of custody.

[10] Regarding the issue of access, the Applicant’s Offer dated October 18, 2014 contemplated access by the Respondent three weekends per month from Friday at 6:00 until Sunday at 6:00 subject to her entitlement to exchange weekends with the Respondent upon seven days’ notice to accommodate functions pertaining to the children. The Respondent offered access each Wednesday from after school until Friday after school plus alternating weekends when there is no midweek access. The difficulty with the Respondent’s Offer is that it is internally inconsistent on this issue given that it proposes midweek access each Wednesday to Friday and ties alternating weekend access to weeks when there is no midweek access. My judgment at trial granted the Respondent alternating weekends from Friday after school until Monday morning drop-off at school, to be extended to include the extra day of holiday weekends plus each Wednesday after school until Thursday at 7:00 p.m. I assess the parties’ success as mixed on this issue.

[11] Regarding summer access the Applicant’s Offer did not contemplate any vacation time for the Respondent with the children, although it did address the Applicant’s vacation and travel with the children. The Respondent’s Offer mirrored the recommendations of the Office of the Children’s Lawyer. Given my judgment on the issue of summer access, the Respondent was more successful on this issue. The Applicant’s position was unreasonable on this issue given that her Offer did not contemplate any summer access by the Respondent with the children.

[12] Similarly with respect to Christmas Holidays, March Break, Thanksgiving and Easter, the Applicant’s Offer is silent whereas the Respondent’s Offer proposes equal sharing of those holidays as agreed by the parties. Given the terms of my judgment on these issues, the Respondent was more successful and the Applicant’s Offer was not reasonable not given its silence on these significant issues.

[13] One of the primary issues at trial was the Respondent’s income for support purposes. Considerable time and evidence was devoted to this issue. It was the Applicant’s position at trial that income of $130,000 ought to be imputed to the Respondent. As can be seen from my Reasons for Judgment, I rejected this position, not just because of the change in the Respondent’s employment circumstances shortly prior to trial, but also because, prior to that change in circumstances, the Applicant’s position was simply not supported by the evidence. Although I find that the Applicant was entitled to child support (given her primary care of the children) and spousal support (on a compensatory basis) I did not award base child support or spousal support except for $1 per year, given the Respondent’s lack of income at the time of trial. The Applicant, in her Offer dated October 18, 2014, proposed no spousal support for either party but proposed child support continuing in the amount of $926 per month. The Respondent’s Offer proposed no spousal support and a suspension of child support. The parties enjoyed mixed success on these issues. Although I awarded only $1 per year for spousal support, I did find entitlement was made out in favour of the Applicant; however, the Applicant’s position on the issue of the Respondent’s income was not reasonable and consumed a considerable amount of time during this trial.

[14] On the issue of equalization, the Applicant ignored my order of November 28, 2014 that her written submissions include a Net Family Property Statement with figures cross-referenced to specific exhibits to assist me in assessing the parties’ positions. On the other hand, the Respondent failed to comply with an order that he provide a valuation with respect to his interest in Strictly Paper Limited. The Applicant’s Offer to Settle of October 18, 2014 did not specifically address the issue of equalization although it did propose that the Respondent receive the remaining balance of the net proceeds of sale of the matrimonial home and that the Applicant receive $15,000 held as deposit by the Toronto Sun. The Respondent’s Offer to Settle proposed that the proceeds of sale of the home be released in full to the Respondent in exchange for a release on the issue of equalization. At trial the Applicant sought a finding that the Respondent owed her $32,416.36 while the Respondent submitted that the Applicant owed the Respondent an equalizing payment of $33,153.71. I found that the Applicant owed the Respondent the sum of $10,380.21 by way of equalization. I find that the Respondent enjoyed more success on this issue than did the Applicant although that success was mixed.

[15] The Applicant seeks costs on a full indemnity basis in the amount of $67,847.71. She submits that the Respondent’s conduct was unreasonable as a result of delays, refusal to consent with respect to matters pertaining to the children, refusing to acknowledge receipt of email correspondence, refusal to negotiate settlement and unilateral decisions with respect to holiday access. She also cites his failure to comply with the order that he secure a valuation of his interest in Strictly Paper Limited.

[16] The Respondent seeks costs on a substantial indemnity basis in the amount of $64,985.74 or alternatively on a partial indemnity basis in the amount of $45,797.94.

[17] This trial involved attendance on eight days. The costs claimed by both parties are not out of line with that number of days of trial and the preparations necessarily associated therewith.

[18] However, there are factors to consider with respect to the reasonableness of the parties’ conduct during these proceedings. When this matter was called for trial on November 17, 2014, the Applicant advanced an unsuccessful request for adjournment. She had given no notice of the request to the Respondent. This consumed time unnecessarily. Also, problems were encountered with organization of the Applicant’s exhibits for trial. This delayed completion of the matter and increased costs. Further, the Applicant sought and was granted leave to call witnesses not contemplated by the trial management endorsement. Time was consumed in addressing the issue of leave; however, ultimately the Applicant did not act upon the leave given and thus that time was consumed unnecessarily.

[19] There was also, as indicated above, considerable expenditure of time in relation to the advancement of the Applicant’s position that $130,000 per annum ought to be imputed to the Respondent. This consumed an enormous amount of time at trial and ought to be factored into the equation in assessing reasonableness of her position.

[20] I also consider the Applicant’s position and evidence with respect to allegations of cocaine use, theft by Respondent from Sun Media Corporation and poor communication between the parties. On all of these issues I found the Applicant’s evidence was not credible and found in favour of the Respondent. I am concerned regarding the Applicant’s insistence on advancing serious allegations, particularly in respect of criminal misconduct, without any meaningful evidence being presented to support those allegations.

[21] Neither parties’ Offer can be said to represent a better outcome for the opposite party, had that offer been accepted by the opposite party. I do consider the Offers’ reasonableness or lack thereof, but neither offer triggers any specific costs consequences.

[22] There is no doubt that the issues in this proceeding were of considerable importance to both parties. The issues however were not particularly complex.

[23] I have noted above the behaviour of the Applicant that I consider to be unreasonable. On the part of the Respondent, his failure to comply with the order that he produce a valuation of his interest in Strictly Paper Limited was also unreasonable.

[24] Given the parties’ mixed success and the parties’ roughly equal degrees of unreasonableness as outlined above, I conclude that neither party is entitled to costs from the other. The parties shall bear their own costs of these proceedings.

[25] As a result of the foregoing the monies referred to in para. 130 of my Reasons for Judgment shall be released forthwith to the Respondent.

DOUGLAS J.

Released: April 17, 2015

Vagadia v. Vagadia, 2015 ONSC 2532

Case Summary

REASONS FOR DECISION ON COSTS

Judge

Counsel

Parties

Areas of Law

Fact Patterns

Issues