CITATION: Sartain v. McCabe, 2015 ONSC 3376
COURT FILE NO.: 847/12 (St. Catharines)
DATE: 2015/06/01
SUPERIOR COURT OF JUSTICE – ONTARIO
FAMILY COURT
RE: Dallas Ernest Sartain (Applicant) v. Isabel Marie McCabe (Respondent)
BEFORE: The Honourable Mr. Justice R.A. Lococo
COUNSEL: Daniel Toppari, for the Applicant
The Respondent was not represented by counsel
HEARD: By written submissions dated April 21 to May 8, 2015
E N D O R S E M E N T – C O S T S
I. Introduction
[1] Dallas Sartain brought a family law application following the breakdown of his marriage to Isabel McCabe. At trial, the principal matters in issue were spousal support for Ms. McCabe, the parties’ joint liabilities and the expenses relating to their former matrimonial home. For the reasons set out in Reasons for Judgment dated April 8, 2015,[^1] I dismissed Ms. McCabe’s spousal support claim and, among other things, ordered Mr. Sartain to hold Ms. McCabe harmless and indemnify her with respect to her obligations under their joint line of credit. The final order also provided that Mr. Sartain’s failure to comply in any material respect with the order’s payment requirements would constitute a material change of circumstances with respect Ms. McCabe’s entitlement to spousal support. The issue of costs was left to be determined following written submissions.
[2] In the written submissions filed by Mr. Sartain’s counsel, Mr. Sartain sought costs against Ms. McCabe based on his substantial success on the application. He argued that costs should be awarded on a full indemnity basis in light of his offer to settle dated May 24, 2013. Under the offer to settle, among other things: (i) Mr. Sartain would have assumed responsibility for Ms. McCabe’s liability under the parties’ joint line of credit; (ii) Ms. McCabe’s claim for spousal support would have been dismissed; and (iii) the parties would have waived any future claims against each other, including claims for spousal support. In support of his claim for costs, Mr. Sartain filed a Bill of Costs indicating full indemnity fees, disbursements and taxes totalling $18,496. Mr. Sartain seeks a costs order of $15,000 against Ms. McCabe.
[3] In her costs submissions, Ms. McCabe argued that she should not be responsible for Mr. Sartain’s legal costs, based primarily on her precarious financial position. She also relied on what she considered to be Mr. Sartain’s irresponsible behaviour, including his employment difficulties and disrespect for his marital vows.
[4] Based on the foregoing, the issues to be determined relating to costs are: (i) entitlement to costs; (ii) scale of costs; and (iii) amount of costs. I will deal with each of these issues in turn.
II. Entitlement to costs
[5] Under subrule 24(1) of the Family Law Rules,[^2] there is a presumption that a successful party is entitled to the costs of a proceeding. As the successful party in this case, Mr. Sartain has the benefit of that presumption. In all the circumstances, I find that a costs award in his favour is appropriate in this case.
[6] In reaching that conclusion, I considered Ms. McCabe’s argument that I should take into account Mr. Sartain’s behaviour as a relevant factor in determining his entitlement to costs. As provided for in subrule 24(4), a successful party may be deprived of all or part of his or her costs by behaving unreasonably during a case. Whatever Ms. McCabe’s views may be about Mr. Sartain’s behaviour leading to the breakdown of their relationship, I saw nothing in his behaviour in the conduct of his case that would justify denial of all or part of his costs.
[7] In reaching my decision to award costs to Mr. Sartain, I also considered Ms. McCabe’s position that her precarious financial position should be taken into account. As indicated later in these reasons, I agree with Ms. McCabe that her financial position is a relevant factor in determining the issue of costs. However, in the circumstances of this case, I have concluded that Ms. McCabe’s financial position has an impact on the amount of costs that should be awarded, but does not affect Mr. Sartain’s entitlement to costs.
III. Scale of costs
[8] As previously indicated, Mr. Sartain is seeking full indemnity costs in light of his offer to settle dated May 24, 2013. Under subrule 18(14) of the Family Law Rules, unless the court orders otherwise, a party who makes an offer is entitled to full indemnity costs from the date of the offer if, among other things, the offering party obtains an order that is as favourable as or more favourable than the offer. In this case, I have concluded that Mr. Sartain does not have the benefit of this provision. Accordingly, costs should be awarded on a partial indemnity basis throughout, rather than on a full indemnity basis from the date of the offer.
[9] Under both the final order and the offer, Ms. McCabe’s claim for spousal support would be dismissed and Mr. Sartain would assume responsibility for her liability under the joint line of credit. However, there is one key variance between the final order and the terms of the offer. Under the final order, Ms. McCabe’s entitlement to spousal support becomes reviewable upon a material failure by Mr. Sartain to comply with his payment obligations under the order. In contrast, under the offer, Ms. McCabe would be required to waive any future entitlement to spousal support. In my view, that variance from the terms of the final order means that a key safeguard of Ms. McCabe’s future rights was not present under the terms of the offer. As a result, in my view, Mr. Sartain does not have the benefit of subrule 18(14) in this case.
IV. Amount of costs
[10] In order to determine the amount of costs that should be payable to Mr. Sartain, I take as a starting point the Bill of Costs prepared by Mr. Sartain’s counsel in the amount of $18,496, including full indemnity fees of $16,125, disbursements of $243 and tax of $2,128. As is evident from the Bill of Costs, this application was commenced in December 2012 and included two full days of trial. Based on the description of services included in the Bill of Costs, I am satisfied that the charges were reasonable in the circumstances as full indemnity costs.
[11] Since I am awarding costs on a partial indemnity basis, the amount payable by Ms. Sartain should be less than the full amount set out in the Bill of Costs. As well, as indicated previously, I consider Ms. McCabe’s financial position to be relevant in determining the amount of costs that should be awarded.
[12] In this regard, it is clear from previous case law that the courts have the discretion to take a party’s impecuniosity into account in determining the extent to which costs should be awarded against that party. It is also clear that the interests of the other parties to the proceeding must also be considered. For example, in Burrell v. Peel (Regional Municipality) Police Services Board,[^3] Master Dash reviewed a number of cases that considered to what extent impecuniosity of a litigant may be taken into account when considering the issue of costs and made the following observations:
The cases to which I have referred lead me to conclude that the court has a discretion to take into account the impecuniosity of a litigant in an award of costs and on a motion to dismiss for failure to pay those costs. The court should consider as a relevant factor in the exercise of its discretion the effect on access to justice if costs are sought to be awarded or enforced against an impecunious litigant, but the court is free to then … give it whatever weight it deems appropriate in all of the circumstances, including no weight. Furthermore, although impecuniosity is a relevant factor, it is only one factor. There is not only one party involved in the action – the defendant has rights as well which the court must take into account.[^4]
[13] In this case, I am satisfied that given Ms. McCabe’s financial position at the current time, a significant costs award would be a substantial financial hardship for her. Her only asset of any significance is her interest in the matrimonial home, which likely has a negative value once the balance due on the mortgage is taken into account. Her earning capacity is limited until she is able to move from her current location.
[14] In all the circumstances, I am fixing Mr. Sartain’s costs at $6,000, including disbursements and tax, payable by Ms. McCabe within 180 days. In doing so, I have reduced the amount of costs that would otherwise be payable and extended the time for payment. This costs award takes into account the financial challenges faced by Ms. McCabe, weighed against other relevant factors including Mr. Sartain’s degree of success in the litigation.
The Honourable Mr. Justice R.A. Lococo
Released: June 1, 2015
CITATION: Sartain v. McCabe, 2015 ONSC 3376
COURT FILE NO.: 847/12 (St. Catharines)
DATE: 2015/06/01
SUPERIOR COURT OF JUSTICE - ONTARIO
FAMILY COURT
BETWEEN:
Dallas Ernest Sartain
Applicant
- and -
Isabel Marie McCabe
Respondent
BEFORE: The Honourable Mr. Justice R.A. Lococo
COUNSEL: Daniel Topari, for the Applicant
The Respondent was not represented by counsel
ENDORSEMENT – COSTS
Lococo J.
Released: June 1, 2015
[^1]: Sartain v. McCabe, 2015 ONSC 2198, supplemented by 2015 ONSC 2485.
[^2]: O. Reg. 114/99.
[^3]: [2007] O.J. No. 4232; aff’d [2008] O.J. 5718 (S.C.).
[^4]: [2007] O.J. No. 4232 at para. 54.