COSTS ENDORSEMENT

COURT FILE NO.: FC-13-1202

DATE: 20150902

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Mary-Ellen Guertin, Kenneth Cook, Wilhelmina Cook, Applicants

AND

Michael Guertin, Respondent

BEFORE: Blishen J.

COUNSEL: Mary-Ellen Guertin, self-represented

Sean Jones, Counsel for K. and W. Cook, Applicants

Cheryl Payette, Counsel, for the Respondent

HEARD: by written submissions

Introduction

[1] The focus of this three day trial was on the claim by Kenneth and Wilhelmina Cook, parents of the applicant wife, for payment of $181,000 from the net proceeds from the sale of the matrimonial home, based on breach of contract and/or constructive trust.

[2] Other issues were:

(a) the payment of ongoing spousal support to Mrs. Guertin;

(b) Mr. Guertin’s claim for payment by Mrs. Guertin of taxes paid to Canada Revenue Agency (CRA) due to Mrs. Guertin’s failure to provide a written confirmation that he was paying spousal support; and

(c) equalization of net family property (NFP); in particular, a claim by Mrs. Guertin for an exclusion of funds received based on a settlement with Wal-Mart.

Success

[3] Pursuant to subrule 24(1) of the Family Law Rules, O. Reg. 114/99 [FLR], there is a presumption that a successful party is entitled to costs. Offers to settle are important and can be the yardstick by which to measure success. They are significant in determining both liability for costs and quantum. See Osmar v. Osmar (2000), 2000 20380 (ON SC), 8 R.F.L. (5th) 387, at para. 7 (Ont. S.C.) and Lawson v. Lawson, 2008 23496 (ON SC), 2008 CarswellOnt 2819, at para. 7 (Ont. S.C.).

[4] In considering whether a party is successful, the court should also consider the party’s position at trial.

[5] Subrule 24(6) of the FLR provides that if success is divided, a court may apportion costs as appropriate.

[6] A party is generally not entitled to full recovery of costs unless he or she establishes bad faith on the part of the opposing party or serves an offer that conforms to subrule 18(14) of the FLR (see Kimpton v. Ghoura, 2007 CarswellOnt 1927, at para. 7 (Ont. S.C.)). Even when an offer to settle conforms with the requirements of subrule 18(14) of the FLR, the court retains the discretion to award less than full recovery costs (see M.(C.A.) v. M.(D.) (2003), 2003 18880 (ON CA), 67 O.R. (3d) 181 (C.A.)). Pursuant to subrule 18(16), the court may also take into account any written offer to settle, the date it was made and its terms, even if subrule 18(14) does not apply.

The Cooks’ Claim

[7] As noted above, at trial the Cooks claimed $181,000 based on breach of contract and/or constructive trust. Prior to trial they made a number of offers with respect to this claim, the first on April 9, 2014 for a payment of $150,000 from the net proceeds of the sale of the matrimonial home - $75,000 each to be contributed by Mr. and Mrs. Guertin. Their final offer in this regard was made on January 11, 2015 for $70,000 or $35,000 each. Mrs. Guertin immediately accepted the Cooks’ first offer of $150,000 in April, 2014. The Cooks’ offer to settle for $70,000 and Mrs. Guertin’s acceptance and offer to contribute $35,000 were both served on Mr. Guertin together by counsel for the Cooks on January 12, 2015. The positions of Mrs. Guertin and her parents were effectively the same at trial and in their offers to settle.

[8] On January 12, 2015, Mr. Guertin provided an offer to settle the Cooks’ claim for $50,000 from the net proceeds from sale of the matrimonial home held in trust. Although the offer did not specifically state who would bear the burden of paying the $50,000, it was clear that Mrs. Guertin was initially prepared to contribute $75,000 and later $35,000 from her share of the proceeds. Therefore, although she never accepted Mr. Guertin’s offer and further clarification and exploration was required, I find Mr. Guertin’s intention was clear. Subject to Mrs. Guertin’s acceptance, he was offering $25,000 from his share of the net proceeds of sale of the matrimonial home. Mrs. Guertin had already offered to contribute first $75,000 and later $35,000 from her share of the net proceeds of sale. This offer made by Mr. Guertin should have been further explored and considered by Mrs. Guertin and her parents.

[9] At trial I dismissed the Cooks’ claim for breach of contract but agreed with their claim for unjust enrichment and ordered that they receive $46,346.05, 25% of the net proceeds of the sale of the matrimonial home held in trust and that the remaining funds be equally divided between Mr. and Mrs. Guertin.

[10] In determining success on this issue I find Mrs. Guertin’s position to be essentially neutral and find she is not entitled to costs. The Cooks did receive some compensation but significantly less than their last offer of $70,000. Ultimately Mr. Guertin did better than any reasonable interpretation of his last offer. Therefore, I find that Mr. Guertin was the more successful party on this issue.

Spousal Support

[11] Mrs. Guertin represented herself at trial and it was not until just before trial that she agreed to the order requested by Mr. Guertin for spousal support for 2013 and 2014. It was also agreed Mr. Guertin would pay ongoing spousal support to Mrs. Guertin of $350 per month based on his pension and employment income and Mrs. Guertin’s pension income plus some imputed income. Given the last minute agreement trial preparation was necessary by Mr. Guertin.

[12] The only remaining issue at trial with respect to spousal support was Mr. Guertin’s claim for payment by Mrs. Guertin of taxes that he paid to CRA given her failure to provide a written confirmation that he was paying spousal support. Mr. Guertin was not successful on this issue.

[13] The issues surrounding spousal support were not particularly complex or time consuming. I find there was divided success and there will be no costs ordered.

Equalization of NFP

[14] The only property issue remaining at trial was Mrs. Guertin’s claim for exclusion of the total settlement she received for her claim against Wal-Mart. She was unsuccessful in obtaining this exclusion. In addition, all the figures outlined on Mr. Guertin’s NFP statement were accepted and ultimately agreed to at trial and Mrs. Guertin was ordered to pay Mr. Guertin an equalization payment of $10,443.53. On November 12, 2014, Mr. Guertin served an offer to settle wherein Mrs. Guertin would pay $3,500 with the remaining money in trust divided equally following a determination of the Cooks’ claim. Mr. Guertin was the successful party with respect to the property issues.

Quantum

[15] Subrule 24(11) sets out the relevant factors in determining the amount of costs as follows:

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.

(a) Nature of the Issues

[16] As previously noted, the most important, complex and difficult issue during the three day trial was the determination as to whether there had been a breach of contract or unjust enrichment such that the Cooks’ claim for $181,000 from the net proceeds of sale of the matrimonial home should be successful. This issue took up most of the trial time and 13 pages of the 15 page Judgment.

(b) Reasonableness

[17] The factors to be considered in determining reasonableness are outlined under subrule 24(5) as follows:

In deciding whether a party has behaved reasonably or unreasonably, the court shall examine,

(a) the party’s behaviour in relation to the issues from the time they arose, including whether the party made an offer to settle;

(b) the reasonableness of any offer the party made; and

(c) any offer the party withdrew or failed to accept.

[18] Regarding the Cooks’ claim, I find all parties behaved reasonably.

[19] On the issues between herself and Mr. Guertin, I find Mrs. Guertin’s behavior unreasonable. She did not provide her position on many outstanding issues prior to trial which necessitated trial preparation by Mr. Guertin. As previously noted, it was not until the trial commenced that Mrs. Guertin agreed to accept most of the orders proposed by Mr. Guertin. In addition she failed to provide a net family property statement despite attending two settlement conferences and an order on January 9, 2015 that she provide one forthwith. It was not until after the trial commenced that Mrs. Guertin provided her NFP statement.

(c) Lawyers Rates, time spent and expenses

[20] Mrs. Guertin represented herself at trial. Prior to trial she had retained counsel whose total fees and disbursements were $36,801.89. She argued in her Costs Submissions that overall she was the successful party and therefore entitled to partial indemnity costs of $20,000. I note the Bill of Costs submitted by her counsel prior to trial includes fees for preparation and attendance at other court appearances. Mrs. Guertin’s request for $20,000 in costs does not indicate payable by whom but presumably it is by Mr. Guertin. The rates charged by her counsel and the disbursements are reasonable.

[21] The Cooks request $23,135 in partial indemnity costs, arguing that they were clearly the successful parties. I find the hourly rate, fees and disbursements reasonable, totaling $35,436.86. Once again, the Bill of Costs reflects fees and disbursements for preparation and attendance at other conferences prior to trial.

[22] Mr. Guertin requests partial indemnity costs up to the dates of his offers to the respective parties, and full recovery costs thereafter. It is unclear exactly how much he is requesting. His Bill of Costs reflects an amount of $39,786.37. Partial indemnity costs plus disbursements would be approximately $24,800. Again as with the Cooks and Mrs. Guertin, some of the fees and disbursements relate to preparation for attendance at previous court appearances. As with the other parties I find the fees and disbursements reasonable.

[23] I note the submissions for partial indemnity costs by all parties are similar. Therefore, it cannot be said that the costs submissions exceed reasonable expectations.

(d) Any other relevant matter

[24] Subsequent to the judgment, Mr. Guertin drafted and attempted to take out the order. He argues there were three months of unnecessary delay before Mrs. Guertin finally approved the order in its original form. He therefore requests legal fees and disbursements including HST of $1,774.10.

[25] Mrs. Guertin argues the delay was due to some confusion regarding two issues of significance to her, one being security for support and the other being extended health coverage. Although there was some delay necessitating further involvement by both counsel, Mrs. Guertin’s queries were reasonable. There will be no costs with respect to finalization of the order.

Conclusion

[26] The assessment of costs is not a mechanical issue (see Boucher et al v. Public Accountants Council for the Province of Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291, at para. 26 (C.A.)). As stated by the court in Delellis v. Delellis, 2005 36447 (ON SC), 2005 CarswellOnt 4956, at para. 9 (Ont. S.C.): “The overall objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particular circumstances of the case, rather than an amount fixed by the actual costs incurred by the successful litigant.” See also Serra v. Serra, 2009 ONCA 395, 66 R.F.L. (6th).

[27] As noted above, Mr. Guertin was partially successful with respect to the Cooks’ claim and successful with respect to the property issues. Therefore he is entitled to some partial indemnity costs against the Cooks and against Mrs. Guertin.

[28] Taking into consideration all the factors noted above, I order Mr. and Mrs. Cook to pay Mr. Guertin costs of $10,000 inclusive of disbursements and HST as a fair and reasonable amount under all the circumstances. I further order Mrs. Guertin to pay Mr. Guertin costs of $2,000 inclusive of disbursements and HST. These costs are payable forthwith.

Blishen J.

Date: September 2, 2015

COURT FILE NO.: FC-13-1202

DATE: 20150902

ONTARIO

SUPERIOR COURT OF JUSTICE

RE: Mary-Ellen Guertin, Kenneth Cook, Wilhelmina Cook, Applicants

AND

Michael Guertin, Respondent

BEFORE: Blishen J.

COUNSEL: Mary-Ellen Guertin, self-represented

Sean Jones, Counsel for K. and W. Cook, Applicants

Cheryl Payette, Counsel, for the Respondent

COSTS ENDORSEMENT

Blishen J.

Released: September 2, 2015