Slongo v. Slongo, 2015 ONSC 3327

Slongo v. Slongo, 2015 ONSC 3327

COURT FILE NO.: FS-08-62590-00

DATE: 2015 05 25

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: LOUISE SLONGO AND CHRISTOPHER SLONGO

BEFORE: LEMON J.

COUNSEL: Mr. Paul Buttigieg, for the Applicant

Mr. Herschel Fogelman, for the Respondent

COSTS ENDORSEMENT

The Issue

1On March 31, 2015, I determined the parties’ dispute relating to Mr. Slongo’s early retirement and his child support and spousal support obligations.

2I have now received costs submissions from both parties. Ms. Slongo submits that she should receive costs in the amount of $30,000, or alternatively there should be no costs. Mr. Slongo seeks costs of $62,737.41.

Legal Authorities

3The Family Law Rules provide that:

24. (1) There is a presumption that a successful party is entitled to the costs of a motion, enforcement, case or appeal.

(11) 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.

4Costs rules are designed to foster three fundamental purposes:

(a) to partially indemnify successful litigants for the cost of litigation;

(b) to encourage settlement; and

(c) to discourage and sanction inappropriate behaviour by litigants.

(See: Fong et. al. v. Chan, 1999 CanLII 2052, 46 O.R. (3d) 330. (O.N.C.A.).

5One of the significant issues raised in the parties’ submissions is with respect to their offers to settle. Rule 18(14) of the Family Law Rules provides for cost consequences for the failure to accept an offer to settle. The Rule states:

A party who makes an offer is, unless the Court orders otherwise, entitled to costs to the date the offer was served and full recovery of costs from that date, if the following conditions are met:

1. If the offer relates to the motion, it is made at least one day before the motion date;

2. If the offer relates to a trial or the hearing of a step other than a motion, it is made at least seven days before the trial or hearing date;

3. The offer does not expire and is not withdrawn before the hearing starts;

4. The offer is not accepted;

5. The party who made the offer obtains an order that is as favourable as or more favourable than the offer.

6Finally, I am required to take into consideration what an unsuccessful party would reasonably expect to pay for such a proceeding. Costs awards, at the end of the day, should reflect “what the court views as a fair and reasonable amount that should be paid by the unsuccessful parties”: see Boucher v. Public Accountants Council for the Province of Ontario, 2004 CanLII 14579 (Ont. C.A.), 71 O.R. (3d) 291 at para. 24.

Analysis

The importance, complexity or difficulties of the issues

7This matter was extremely important to both parties and a very difficult factual and legal case. That has already been set out in my reasons for judgment. (2015 ONSC 2093).

The reasonableness or unreasonableness of each party’s behaviour in the case

8Mr. Slongo submits that Ms. Slongo has been unreasonable throughout in her positions. There is no doubt that Ms. Slongo has been spectacularly unsuccessful in light of her position taken from beginning to end. However, being unsuccessful does not mean that one is unreasonable.

9I see no other reason to suggest that either party has been unreasonable as envisioned by this factor.

Offers to Settle

10In final submissions, Ms. Slongo sought monthly spousal support totalling $13,000. She asked for the top end of the range provided for by the Spousal Support Advisory Guidelines.

11In Ms. Slongo’s offer to settle of November 1, 2013, she submitted that $49,866.66 would be imputed to Mr. Slongo for each and every taxation year from 2012 to and including 2024. She proposed that child support would continue and that spousal support would be calculated on the “with child” formula resulting in support between approximately $4000 and $5000 over differing years. . She offered to settle arrears of support for something in excess of $100,000. Finally, she proposed that Mr. Slongo would pay a variety of ongoing section 7 expenses for their daughter. All of the terms were severable.

12Mr. Slongo initially submitted that there should be no change in spousal support. In the alternative, if I were satisfied that there was a material change in circumstances, he submitted that spousal support could be increased to between $4,000 and $5,000 per month.

13Mr. Slongo made an offer to settle dated December 2, 2013. There he proposed that the application be resolved by a dismissal of the child support claim, a lump sum payment of $185,000 and ongoing spousal support payments of $3,650 per month. This last offer was apparently not time limited other than by a variation by agreement or order based on a material change in circumstances.

14He also made a pre-payment of $25,000 toward any obligation of his that I might order.

15In order to consider the parties’ offers to settle, it is important to remember what was decided by my ruling of March, 2015.

16The 2011 order required Mr. Slongo to pay $2,650 per month in spousal support.

17One of the issues before me was whether Mr. Slongo was still required to pay child support but he was not currently paying it. Ms. Slongo sought a continuation of child support. That claim was dismissed.

18Mr. Slongo submitted that there had been no material change in circumstances to warrant a change in spousal support. That argument was dismissed.

19In the end result, I ordered an increase of spousal support for the period September 1, 2012, to September 1, 2017, in the amount of $5,000 per month. I imputed additional income of $57,000 to Mr. Slongo for each of the years 2012 to 2017.

20Although Ms. Slongo submits that the result was such that she beat her offer with respect to the issue of imputing income, that is the only topic that she offered better than the result. In her submissions, she compares my order with her offer but she compares them for the period January 2013 to August 2024. My order is only until 2017. All of her terms envisioned a change through to 2024 and beyond. There was nothing severable in the offer that would have made a result better for Mr. Slongo than what occurred in my ruling.

21While the exact differences between the two offers are difficult to calculate, there is no doubt that Mr. Slongo did much better than his offer and that Ms. Slongo would have been much better off had she accepted that offer.

22It appears that Mr. Slongo made an effort to resolve these issues as soon as he elected to take early retirement. Ms. Slongo’s response was entirely unrealistic. Mr. Slongo had no choice but to defend himself against her application. As can be seen above, Ms. Slongo’s final submission for support was entirely unrealistic. But she has a right to put forward her position at court. Putting forth losing propositions does not necessarily make one unreasonable; however, her position underscores how reasonable Mr. Slongo has been. A costs order should take that into consideration.

The lawyers’ rates

23While normally, the costs consequences of Rule 18(14) would entitle Mr. Slongo to full indemnity costs after his offer, the Rule does not require the presiding justice to allow the successful party to demand a blank cheque for his costs.

24Mr. Slongo elected to have two lawyers work on his file. That is sometimes entirely reasonable where senior counsel does less of the work at a higher rate and junior counsel does more of the work at a lower rate. The cost submissions on behalf of Mr. Slongo do not distinguish that. It appears that there has not been a great benefit to Mr. Slongo by having two counsel. Junior counsel attended with senior counsel on the argument of this matter on June 4 and 5. The proceeding carried on without junior counsel on February 13, 2015. While it is always good for senior counsel to bring junior counsel along to assist with junior counsel’s training, I see no reason for an unsuccessful party to pay for those costs.

25Both parties required experienced and sophisticated family law counsel to grapple with these issues. The rates are appropriate.

The time properly spent on the case

26Both Bills of Costs refer to preparation and attendance at the DRO Case Conference. I am not advised of any cost order carrying that item forward to trial. Those costs are not properly part of my assessment. See: Islam v. Rahman, 2007 ONCA 622, [2007] O.J. No.3416 (Ont.C.A.)

27The case was argued over two days. There were extensive cross-examinations and undertakings. There was one day of a false start by both parties that required an adjournment. While in the end result, I did not find the viva voce expert evidence necessary, it is not innapropriate that both parties required that assistance to assess the case.

Expenses properly paid or payable

28Neither party disputes the disbursements of the other.

Any other relevant matter

29While success has been divided, Mr. Slongo was certainly successful on the most important issue, being the amount of spousal support going forward. A costs order here should encourage litigants like Ms. Slongo to take more appropriate steps to resolve a dispute, and it should encourage others like Mr. Slongo to take the route he followed.

30Given the detailed offers and the present submissions, I can assume that the parties were advised of the costs consequences of an unsuccessful hearing.

Result

31In the end result, and balancing all of those factors, I am confident that Ms. Slongo would reasonably expect to pay $45,000 in costs to Mr. Slongo if she were unsuccessful. And that is what is ordered.

Lemon J