Superior Court of Justice – Ontario (Family Court)

Citation: Ponkin v. Werden, 2015 ONSC 2598 Court File No.: F887/13 Date: April 21, 2015

Re: Sue Ponkin, applicant And: Leonard James Werden, respondent

Before: Mitrow J.

Counsel: Sharon Hassan for the applicant Thomas G. Chalmers for the respondent

Heard: written submissions filed

ENDORSEMENT ON COSTS

[1] Pursuant to my endorsement dealing with interim spousal support, released February 10, 2015, I have received the parties’ written costs submissions: the applicant’s submissions on March 2, 2015; the respondent’s submissions on March 9, 2015; and the reply on March 12, 2015.

[2] The applicant obtained an order of interim spousal support, to commence June 1, 2013: $3,750 per month for 2013; $5,500 per month for 2014: and $4,500 per month thereafter.

[3] The applicant seeks costs of $19,933.50 for fees and disbursements, plus HST; the respondent submits that the applicant should have costs of $4,500, “… provided the court is satisfied the Applicant is not responsible for the delay” in preparing an expert report from Mr. Hoare.

[4] I need to consider the factors in r. 24(11).

[5] The sole issue on the motion was interim spousal support claimed by the applicant. While entitlement was conceded, quantum was a substantial issue. The hearing of the motion spanned portions of three different days. The determination of the respondent’s income was a significant issue; the respondent is a high-income earner; he is self-employed and has interests in various corporations. There were various “discrete” issues that had to be determined on the motion that included: the relevance of the “SSAGs” (Spousal Support Advisory Guidelines); whether the notional child support should be “grossed-up” respecting the respondent’s children from a previous relationship, who were in his care; to what extent should the grossed-up child support include s. 7 expenses; should any of the corporate expenses be disallowed on the basis that they were the respondent’s personal expenses; attribution of income to the applicant; and whether income for some of the other corporations in which the respondent had an interest should be included in the respondent’s income for spousal support purposes.

[6] Both counsel assisted the court by filing fairly extensive financial material and various schedules, and computations, including various SSAG scenarios. This material was germane to the motion.

[7] The hourly rates in the applicant’s bill of costs are reasonable and, given the complexity of the motion, the time spent appears to be within a reasonable range.

[8] I do not find that either party behaved unreasonably. I am unwilling, as urged by the respondent, to find that the applicant engaged in a delay because Mr. Hoare’s report, that would have addressed the respondent’s income available for spousal support, was not ready for the motion. It is not possible to determine on the motion material why the report was not available. Also, in making his submission about an alleged delay by the applicant, the respondent seems to gloss over his own conduct in failing to sign a financial statement by the time of the commencement of the hearing of the motion, choosing instead to have his office manager sign the financial statement, on the unconvincing pretense that the respondent really knew nothing about the financial picture of his corporations, but that his office manager did, as she looked after all the financial details including writing cheques.

[9] I find that this motion was nothing more than a hard-fought motion with each party acting reasonably advancing his or her position as to the proper quantum of support.

[10] Both parties submitted offers; in my view, the applicant’s offers, overall, were “closer to the mark,” particularly the applicant’s offer dated September 29, 2014.

[11] However, I do not accept the applicant’s submission that her offer dated September 29, 2014 engages the automatic costs consequence of r. 18(14). That offer provided for interim spousal support payments of $5,500 per month starting January 1, 2014, with costs reserved to the judge disposing of this matter. The order, however, started spousal support from June 1, 2013; given that Mr. Werden was already paying $2,666 per month since June 2013, and the order for 2013 was $3,750 per month, the order was more favourable to the applicant than her offer, but only for 2013, to the extent of $1,084 per month for seven months. For 2014, the offer was the same as the order; however, starting 2015, the offer exceeds the order by $1,000 per month. To gain the benefit of r. 18(14), the burden is on the applicant to prove that the order in its entirety is as favourable as or more favourable than her offer to settle; however, that will depend how long the order continues. For example, if the interim order is still in effect at the end of August 2015, then by that time any advantage of the order, over the offer for 2013, will have been more than offset, in 2015, with the result that overall the condition in paragraph 5 of r. 18(14) is not met. Accordingly, given that the length of the interim order is unknown, that means that the applicant is not able to prove that the order is as favourable as or more favourable to the applicant than her offer. Having said that, I do take into account that this offer was reasonably close to the order.

[12] The applicant was successful on the motion; she is presumptively entitled to costs.

[13] I do not accept the respondent’s analysis, in paragraph 4 of his submissions, that the respondent “achieved substantial success on the real issues.” The determination of costs, in the present case, does not in any significant way turn on the various discrete issues (it being noted that each party had some success on the discrete issues), but rather, the motion was all about quantum of spousal support, and the respondent “missed the mark” as to quantum – he was too low.

[14] This is not a case where the applicant’s costs to which she is otherwise entitled should be reduced, or perhaps eliminated, as implied by the respondent.

[15] In Sims-Howarth v. Bilcliffe, 2000 CarswellOnt 299 (S.C.J.), at para. 9, Aston J. makes clear that the two traditional scales of costs referred to in the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 are not applicable to quantification of costs pursuant to r. 24, and that if a party is liable for costs, the court must fix the amount at “some figure between a nominal sum and full recovery.” This discussion by Aston J. was approved by the Court of Appeal for Ontario in C.A.M. v. D.M., 176 O.A.C. (Ont. C.A.) at para. 42.

[16] In the present case, the quantum of costs to be paid by the respondent is not defined simply by the costs incurred by the applicant; rather, the costs to be paid by the respondent must be an amount that the court views as reasonable, which is the overriding principle: Davies v. Clarington (Municipality), 2009 ONCA 722, 2009 CarswellOnt 6185 (Ont. C.A.) at para. 52.

[17] The amount of $4,500 suggested by the respondent is completely inadequate given the complexity of the issues and the success achieved by the applicant.

[18] I order the respondent to pay to the applicant forthwith her costs of the motion, fixed in the amount of $15,000 for fees and disbursements, plus 13% HST in the amount of $1,950, for a total of $16,950.

[19] The costs ordered herein shall constitute a support order within the meaning of s. 1(1) of the Family Responsibility and Support Arrears Enforcement Act, S.O. 1996, c. 31 [as amended].

“Justice Victor Mitrow”

Justice Victor Mitrow

Date: April 21, 2015