SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: FC-13-167-00
DATE: 20150831

RE: LYNDA JOHNSON, Applicant

AND:

DOUGLAS TAYLOR, Respondent

BEFORE: THE HON. MADAM JUSTICE S.E. HEALEY

COUNSEL:
J. Ironside, for the Applicant

D. Clark, for the Respondent

HEARD: By written submissions

COSTS ENDORSEMENT

[1] This costs endorsement follows the four-day trial in this case, the determination of which was set out in this court’s Reasons released on June 10, 2015 (Johnson v. Taylor, 2015 ONSC 3750).

[2] A number of issues were settled by the parties prior to and during the trial. This reflects a reasonable approach by each to narrow the issues to be tried. However one issue, being the date of cohabitation, consumed considerable trial time until the applicant conceded that the appropriate date was January, 1995, which had been the respondent’s position throughout. Ultimately that was not an important concession, however, as periodic spousal support was ordered in the mid-range for an indefinite duration, which result would not have been altered by the additional four years of cohabitation originally sought by the applicant.

[3] The issues that were tried were set out in paragraph 3 of this court’s Reasons. The parties attempted to settle some of the trial issues by formal offer to settle. The content of those offers, and a comparison to the order made at trial either on consent or by judicial determination, is accurately set out in a chart prepared by the respondent’s counsel and enclosed the respondent’s costs submissions brief. Overall, there were terms of each parties’ offers to settle that were equally or less favourable to them than the trial outcome, or were very close to the order made. None of the terms were severable. One of those offers, made by the applicant, was delivered on May 29, 2015 and therefore not able to attract the costs consequences of rule 18(14) of the Family Law Rules, O. Reg. 114/99.

[4] Given the content of the offers, however, it is apparent that three discrete issues particularly impeded settlement. These were: 1) an exclusion of $34,659.58 sought by the applicant from her net family property, resolved in the respondent’s favour; 2) the amount of income to be imputed to the applicant for the purpose of determining quantum of spousal support, resolved in the applicant’s favour; and 3) the amount of retroactive spousal support, also resolved in the applicant’s favour in that the trial award more than doubled the respondent’s position either at trial or in any offer made by him.

[5] Another issue that took up considerable trial time was a judicial determination of the respondent’s income for 2012 and 2015. The amount determined by the court was, for both years, over $20,000 less than the amount being urged upon the court by the applicant.

[6] These factors all lead to the conclusion that substantial indemnity costs would be inappropriate in this case, for either party, as success was mixed on many issues. None of the parties’ positions on any issue was patently unreasonable, and neither conducted themselves during the litigation in an unreasonable manner. This court can, however, and does, take into account that the proceeding itself was triggered by two precipitous actions by the respondent as set out in paragraph 33 of the Reasons, and may never have been commenced but for that conduct.

[7] Ultimately, the resolution of the application results in a total award of $70,685.32 payable to the applicant for retroactive spousal and child support, retroactive section 7 expenses an equalization payment and pre-judgment interest. Given the respondent’s position on spousal support, retroactive and ongoing, some costs are warranted. However, given the applicant’s position on both the respondent’s income and the exclusion for her inheritance, such costs should be sharply reduced given that both of those issues were not resolved in the applicant’s favour and took up substantial trial time.

[8] There is nothing in Rule 24 which limits the court’s ability to award costs of the entire case, provided there is no duplication of any cost award made during any step in the proceeding. The case of Skramrud v. Skramrud, 2008 736 (ONSC) does not stand for the proposition that costs are to be awarded only from the date of a trial management conference going forward, if costs have not been ordered up to that point, as submitted by the respondent’s counsel. Costs are routinely not awarded during the conference stages of the case so that such orders do not impede settlement. There is also no requirement that a specific endorsement reserving costs to the trial judge must be in place in order to preserve a party’s right to claim same following a trial or other resolution of the case.

[9] The applicant claims total costs of $63,711.79 on a partial indemnity basis, being three-quarters of substantial indemnity costs of $84,949.06.

[10] Having regard to the factors in rule 24(11) not yet addressed in this endorsement, it is noted that no objection was made by the respondent to either the reasonableness of the fees, time or disbursements set out in the applicant’s bill of costs.

[11] In terms of proportionality, the partial indemnity costs sought to be recovered are not unreasonable given that the case took over two years to reach trial, and it is clear that considerable work was undertaken to both resolve the issues and conduct the trial. However, for the reasons already articulated, it would be a fair outcome to reduce the sum sharply to recognize that some of the positions taken by the applicant affected the failure of the parties to reach resolution, and were not resolved in her favour.

[12] In the final result, this Court orders that the respondent shall pay to the applicant her costs of this action fixed in the amount of $30,000 inclusive of HST.

[13] Mr. Ironside also made a request on behalf of the applicant in his submissions to amend paragraph 106 of the Reasons to read “The law firm of Brown Law is hereby authorized to release to the applicant the entirety of the funds held in its trust account to the benefit of the parties, 50% of which is to be credited to the respondent’s equalization payment owing to the applicant in the amount of $34,659…” with a view to ensure the $60,000 held in trust by Brown Law from the sale of the former matrimonial home be attributed to property division so that the judgment is not thwarted by a potential bankruptcy of the respondent, and to properly allocate the funds. The respondent’s counsel did not object to such an amendment in her responding submissions.

[14] Accordingly this Court orders that the final order shall include the following amendment to paragraph 106 of the Reasons as follows:

The law firm of Brown Law is hereby authorized to release to the applicant the entirety of the funds held in its trust account to the benefit of the parties, without necessity of the respondent’s authorization or direction, 50% of which is be credited to the respondent’s equalization payment owing to the applicant in the amount of $34,659 under the terms of this order.

[15] An order shall issue in the terms of paragraphs 12 and 14 of this Endorsement.

HEALEY J.

Date: August 31, 2015