SUPERIOR COURT OF JUSTICE – ONTARIO

COURT FILE NO.: FS-11-71818-00

DATE: 2015-08-05

RE: Aleksandra Niemczyk v. Janusz Bilinski

BEFORE: Lemon, J.

COUNSEL: Alexei Goudimenko, for the Applicant

John Bruggeman, for the Respondents

HEARD: July 23, 2015

COSTS ENDORSEMENT

The Issue

[1] Mr. Bilinski (and all other respondents) brought a motion for judgment in accordance with executed minutes of settlement. In reply, Ms. Niemczyk brought a motion to dismiss Mr. Bilinski’s motion and seeking interim disbursements, a certificate of pending litigation against two properties and requesting that the settlement funds be held in trust. She also sought a number of items of disclosure. Those motions were resolved; the issue for me is to determine the costs of those motions.

Background

[2] In the motion for summary judgment, Mr. Bilinski’s trial counsel, Ms. Bednarska, was required to file her own affidavit. Accordingly, and appropriately, she obtained counsel to argue the motion.

[3] Ms. Niemczyk’s counsel also filed his own affidavit but he appeared at the commencement of the motion without other counsel to argue the motion. On behalf of Ms. Niemczyk, he then requested an adjournment of the motions because she needed an opportunity to reply to materials filed in response to her motion, to obtain a Polish interpreter and her counsel required time to obtain counsel to argue the motion.

[4] After hearing from both parties, I granted the adjournment on terms. Before the motion was actually adjourned, however, and apparently as a result of the submissions made by Mr. Bilinski’s counsel against the adjournment, counsel for Ms. Niemczyk said that he now understood the case he had to meet. Based on that enlightenment, Ms. Niemczyk agreed to judgment in accordance with minutes of settlement that had been signed between the parties.

[5] In the process of resolving the litigation, there were two minutes of settlement in issue. The first was handwritten and signed by all involved. The second, prepared the following day, was a typed version signed only by Mr. Bilinski and the other respondents. The handwritten version was dated April 27, and the typed version was dated April 28.

[6] In their Notice of Motion, the respondents sought judgment in accordance with the typed minutes of settlement executed by them on April 28, 2015. However, in their factum, they sought judgment in accordance with the handwritten minutes of settlement executed by all of the parties on April 27, 2015. It is the handwritten version of April 27, 2015, upon which Ms. Niemczyk has now consented to judgment. She submits that if she had known that Mr. Bilinski was seeking judgment on the handwritten version, she would have agreed long before and the motions would not have been required.

[7] Accordingly, my endorsement on July 23, was as follows:

After the morning break, the Applicant concedes that the handwritten Minutes of Settlement dated April 27, 2015, are the basis of a proper judgment. The Respondents agree. Order to go for judgment in those terms.

The issue then is the costs of this motion. The cross-motion is withdrawn.

Issue of costs is reserved. Applicant’s counsel shall continue to hold the settlement funds in trust pending the release of these reasons.

Position of the Parties

[8] Mr. Bilinski seeks costs of $33,162.33 because of all of the work that needed to be carried out since the minutes of the settlement were first signed. He submits that there were no significant differences between the two minutes of settlement. The failure of Ms. Niemczyk to stand by the initial resolution incurred all of those costs.

[9] In response, Ms. Niemczyk requests $3,000 in costs because of the work that she had to do because the respondents changed their position between the notice of motion and argument in court. She also submits that as she is impecunious, she should not be required to pay all of the requested costs.

Legal Authorities

[10] The 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.

[11] Costs 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 2052, 46 O.R. (3d) 330. (O.N.C.A.).

[12] In the end, the court is asked to determine what would be a fair and reasonable amount for the losing party to pay.

Analysis

[13] I do not accept Ms. Niemczyk’s position that, had the notice of motion been somewhat different, she would have agreed to the April 27, minutes of settlement. In Mr. Goudimenko’s affidavit in support of Ms. Niemczyk’s motion and in response to Mr. Bilinski’s motion, he says:

I understand that Ms. Niemczyk alleges that the negotiations that occurred during the TMC on April 27, 2015 and in the morning of April 28, 2015 before the matter was called in for trial in the courtroom of Justice Emery were conducted in an impeachable manner given that 1) she did not have a Polish interpreter to assist her from after 3:30 p.m. of April 27, 2015 onwards and could not understand my information and advice due to the language barrier; 2) a substantial part of the Respondents’ documents delivered to my office just a few days before the original trial date of April 27, including the Husband’s Financial Statement of April 20, 2015, was not reviewed with her and she did not have an interpreter to translate these documents to her; 3) the Husband’s last amended FS of April 27, 2015 delivered to me by Ms. Bednarska in court on April 27, 2015 was not reviewed with my client; 4) that I may have acted without my client’s instruction; 5) that my client was stressed out and exhausted due to a long day in court on April 27, 2015 and her lack of funds to continue with her matter and my possible pressure on her to settle; 6) she was rushed.

[14] Further, Ms. Niemczyk refers to the events of April 27, as follows:

Once the Hon. Madam Justice Seppi left the courtroom, Mr. Goudimenko put a piece of paper in front of me with his hand-writing. Mr. Goudimenko indicated that he prepared a summary of the points most recently discussed. He proposed that I sign this paper as evidence of the seriousness of my wish to negotiate and he would then pass it on to the Respondents to see if they were willing to negotiate further.

I had no time to read this paper, neither was it translated to me. I was not in the right state of mind to follow Mr. Goudimenko’s attempted explanations.

Mr. Goudimenko was rushing me as the proceedings were over and the Courtroom would need to be emptied. Mr. Goudimenko expressed his hope to me that maybe the parties could still settle this matter before the trial.

I have attached this paper as Exhibit “30”. For clarity, at the time when Mr. Goudimenko offered me to sign this paper, this paper had not been signed or marked in any way by any of the Respondents.

As I left court on that day, I understood that there would be a trial next day, April 28, 2015 at 10:00 a.m. and that there was no settlement of any issues.

[15] The document at Exhibit 30, is the signed minutes of settlement upon which the consent judgement is now granted.

[16] What this means is that, after swearing that there was no agreement on either April 27 or 28, at the return of this motion, Ms. Niemczyk agreed that what she signed on the 27th, was a proper agreement for this judgement. Further, despite saying that she did not understand what she was signing over the duration of the 27th, within the time of the morning break, she confirmed that it was a proper agreement. Clearly, she was not telling the whole truth in her affidavit that formed the basis for her defence of Mr. Bilinski’s motion and her own motion. That conduct should not be condoned in any way by the court.

[17] Mr. Bilinski has, therefore, been entirely successful on this unnecessary motion; he is entitled to his costs. Conversely, it is clear that Ms. Niemczyk was unsuccessful in denying the settlement and has now withdrawn her cross-motion. She is not entitled to costs.

[18] The materials with respect to both motions were extensive. They amount to approximately six inches of paper. To a large extent, that was caused by Ms. Niemczyk’s lengthy and largely irrelevant affidavit. That required Ms. Bednarska to review it and prepare reply affidavits and Mr. Bruggeman to review all of the affidavits to prepare for argument. A factum and a brief of authorities were required to distil all of that for the benefit of the court. I am satisfied that both lawyers are entitled to bill for that separate work caused by Ms. Niemczyk’s change of mind.

[19] While the legal issues were rather straightforward - was there a settlement or was there a not? - the factual background put in play by Ms. Niemczyk was lengthy.

[20] With $80,000 worth of a settlement funds in issue, this was important to both parties.

[21] The last minute resolution of this motion was entirely unreasonable behaviour by Ms. Niemczyk. Although there were some differences in the two settlement documents, the real issue was whether the action was settled at all. Ms. Niemczyk should have come to grips with that before the motions were underway. Neither side made any offers to settle. One would presume that Ms. Niemczyk would have offered to settle the motion based on the handwritten document, if that were her sincere position.

[22] Mr. Bruggeman, who was to argue the motion, seeks “partial indemnity” rates of $300 per hour for himself and $200 for Ms. Bednarska, who was Mr. Bilinski’s counsel at trial. He seeks $450 and $300 respectively on a “full indemnity rate”. Given their experience, those rates are on the high side.

[23] Mr. Bruggeman has provided a detailed bill of costs including dockets. It appears that he has included travel time at a full hourly rate. That is not appropriate. While I agree that two counsel were, unfortunately, required, it appears that they both did legal research on the same issue. Only one should be charged to Ms. Niemczyk.

[24] Ms. Bednarska worked on the file for 41.2 hours. Mr. Goudimenko objects to that, pointing out that he only worked 30 hours on the file. However, had he prepared a factum, read the factum of Mr. Bilinski and read the reply affidavits, which he admittedly did not do, his hours would be very close to, if not the same as, Ms. Bednarska’s hours. That confirms to me that the time spent is not unreasonable.

[25] There is no dispute with respect to the disbursements.

[26] There is no doubt that Ms. Niemczyk’s financial circumstances could be a factor in determining costs. Her present income would make it impossible for her to pay the costs order. However, in this case, the settlement funds of $80,000 have already been paid to her lawyer. The costs can be paid out of those funds still to be released to her. While that will leave her with little to move on with in life, her conduct since settlement cannot be ignored.

[27] The costs requested may be a great deal of money, but I can find no fair and reasonable principle for the respondents to pay costs caused entirely by the conduct of Ms. Niemczyk.

[28] In all of the circumstances, I fix costs in the amount of $30,000 all-inclusive to be paid by Ms. Niemczyk to Mr. Bilinski. Those funds shall be paid forthwith out of the trust account of Mr. Goudimenko.

Lemon, J.

DATE: August 05, 2015

COURT FILE NO.: FS-11-71818-00

DATE: 2015-08-05

SUPERIOR COURT OF JUSTICE – ONTARIO

RE: Aleksandra Niemczyk v. Janusz Bilinski

BEFORE: Lemon, J.

COUNSEL: Alexei Goudimenko, for the Applicant

John Bruggeman, for the Respondent

COSTS ENDORSEMENT

Lemon, J.

DATE: August 05, 2015