OSHAWA COURT FILE NO.: FC-12-2143-00
DATE: December 8, 2015
SUPERIOR COURT OF JUSTICE – ONTARIO – FAMILY COURT
RE: Kathleen Margaret Owen-Lytle, Applicant
** and**
Randall James Lytle, Respondent
BEFORE: The Honourable Madam Justice Woodley
COUNSEL: Catherine Cornwall-Taylor, for the Applicant
Michael H. Tweyman, for the Respondent
HEARD: December 7, 2015
REASONS FOR DECISION
Overview
[1] The Applicant brings this Motion seeking an Order in the form of an accepted offer to settle. The offer to settle was made in the context of the Respondent’s settlement conference brief dated September 4, 2013. The Applicant served the acceptance of offer on October 6, 2015, several years after initially rejecting the offer and following exchange of counter-offers to settle with the Respondent.
[2] The Applicant contends that her acceptance conforms with Rules 18(9) and 1810) of the Family Law Rules.
[3] The Respondent resists enforcement and claims that Rule 18 does not apply to an offer to settle contained in a settlement conference brief. The Respondent further claims that the Applicant is prohibited from introducing the Offer to the Court pursuant to Rule 17 of the Family Law Rules.
Issues:
[4] The following issues are required to be determined:
a. Does the Offer to Settle contained at paragraph 19 of the Respondent’s Settlement Conference Brief constitute an offer under Rule 18 of the Family Law Rules such that acceptance and enforcement of the Offer are determinable pursuant to Rule 18 of the Family Law Rules?
b. If the Offer to Settle does not constitute an offer under Rule 18 of the Family Law Rules what considerations govern acceptance and enforcement of the Offer?
c. Does the Acceptance of the Offer to Settle constitute a binding agreement between the parties enforceable by the court?
d. Is the Applicant prohibited from introducing the offer to the Court pursuant to Rule 17 of the Family Law Rules.
Determination of Issue:
[5] For the reasons below I find as follows:
a. The Offer to Settle contained at paragraph 19 of the Respondent’s Settlement Conference Brief does not constitute an offer under Rule 18 of the Family Law Rules.
b. Acceptance and enforcement of the Offer to Settle contained at paragraph 19 of the Respondent’s Settlement Brief is governed by the law of contract, analogy to the Family Law Rules, by reference to the Courts of Justice Act and the Rules of Civil Procedure.
c. The Applicant’s Acceptance of the Respondent’s Offer to Settle did not constitute a binding contract between the parties as the Offer had already been implicitly withdrawn by subsequent offers in writing less favourable to the Applicant.
d. There can be no right without a remedy. The pre-printed settlement conference forms specifically provide that an accepted offer can be turned into a court order and enforced. As such it is clear that Rule 17 does not prohibit parties who seek to enforce settlement agreements arising from offers to settle contained in a settlement conference brief from presenting the offers and acceptance to the court seeking enforcement.
Facts
[6] The Offer to Settle contained at paragraph 19 of the Respondent’s Settlement Brief was a mandatory offer made in preparation of attendance at a settlement conference.
[7] The Offer was contained at paragraph 19 of a standard pre-printed settlement conference brief form that includes a section with a heading Part 4. Offer to Settle which reads as follows:
Part 4: Offer to Settle
- The following is my offer to settle the outstanding issues in this case:
__ offer to settle all issues x offer to settle some of the issues
NOTE:- If you have already made an offer and it is still open for acceptance, attach a copy to this brief. If you have not made an offer to settle, you must make one here. If you do not have enough information about all the issues, make a partial offer on those issues for which you do have enough information.
The other side can accept your offer. And if the other side does accept it, the accepted offer becomes a binding contract and can be turned into a court order that can be enforced against you. The other side can make a counter-offer.
[8] The provisions of the offer to settle presented to the court reads as follows:
EQUALIZATION AND ALL PROPERTY ISSUES
PREAMBLE
There is $26,837.25 left in trust with the CAW lawyer.
There is $4,000 left in trust with “Martin Tweyman”.
OFFER
Kathleen shall be entitled to the sum of $23,418.50 from the proceeds of sale held by the CAW lawyer.
Randall shall be entitled to $3,418.75 from the proceeds of sale held by the CAW lawyer.
Randy shall be entitled to the $4,000 that is in trust with “Martin Tweyman”.
Kathleen will remain as beneficiary on my client’s life insurance. In addition, Randall shall leave Kathleen as the beneficiary of the survivor benefits on his pension, such that she would receive 66% of his pension payments if he predeceases her.
There will be no further adjustments or property claims by either party upon the fulfillment of this settlement.
This Offer cannot be accepted in part and must be accepted as a whole.
[9] The offer did not contain an expiration date.
[10] The settlement conference brief was signed personally by the Respondent and by an individual “per” the Respondent’s lawyer.
[11] The settlement conference brief was filed with the court and the settlement conference was held before Justice Hatton on September 12, 2013.
[12] At the settlement conference the Applicant rejected the offer to settle proposed by paragraph 19 of the Respondent’s settlement conference brief.
[13] Following the date of the settlement conference the Applicant and Respondent “exchanged other settlement proposals” with the Respondent’s “position on equalization shrinking” the Applicant’s share. The Applicant’s affidavit swore November 18, 2015 advised that the “Respondent already got an additional $15,750.00 over what I received out of the proceeds of sale of the matrimonial home, but his further offers ignored this. As settlement negotiations were going nowhere, and as without funds I would have to represent myself at trial, I served an Acceptance of that Offer on October 13, 2015.”
[14] Following service of the Acceptance of Offer the Respondent through counsel refused to settle equalization in accordance with the Offer and its acceptance.
[15] The Notice of Motion seeks to enforce the operative portions of the Offer to Settle contained at paragraph 19 of the Respondent’s settlement conference brief. No grounds were provided by the Notice of Motion but counsel advised that she relies upon Rule 18 and Rule 2 of the Family Law Rules.
Analysis
[16] As detailed by Justice Pazaratz in Entwistle v. Entwistle[^1] a settlement conference is a mandatory step in the litigation process. Subrule 17(13) requires that each party serve and file a settlement conference brief in a prescribed form. If a party has not made an offer to settle they are required by the settlement conference brief to make an offer. The pre-printed form states that a party must [emphasis added] make one here. This is different from the language in subrule 18(3) which provides that a party may [emphasis added] serve an offer on any other party.
[17] There is no specific reference to rule 18 offers in either rule 17 or the pre-printed settlement conference form. Further, although the form provides no reference to rule 18 it does reference the law of contract and provides “if the other side does accept it, the accepted offer becomes a binding contract and can be turned into a court order that can be enforced against you.”
[18] In the circumstances, just as Justice Pazaratz concluded in Entwistle, I cannot accept the submission that the offer contained in the settlement conference brief constitutes an offer under rule 18 of the Family Law Rules.
[19] Offers to settle contained in settlement conference briefs are not Rule 18 offers but a different type of offer that is governed by the law of contract and enforced by analogy to the Family Law Rules, by reference to the Courts of Justice Act and application of the Rules of Civil Procedure.
[20] Under the law of contract, the formation of a contract depends on an offer, acceptance and communication of that acceptance. The law of contract provides rules that regulate these elements and the process of contract formation. Similarly, Rule 18 of the Family Law Rules and Rule 49 of the Rules of Civil Procedure also regulate the elements and the process of contract formation in settlement agreements.
[21] However, it is noteworthy that the Family Law Rules and the Rules of Civil Procedure modify a few of the normal rules of contract formation. In particular Rule 18(5) of the Family Law Rules requires that a party who made an offer may withdraw it by serving a notice of withdrawal, at any time before the offer is accepted. This rule is mirrored by Rule 49.04(1) of the Rules of Civil Procedure which provides that an offer may be withdrawn at any time before acceptance by serving written notice of withdrawal of the offer on the party to whom the offer was made. An offer to settle under either the Family Law Rules or the Rules of Civil Procedure cannot be withdrawn orally.[^1]
[22] The question arises whether an offer can be withdrawn by a document other than utilizing a specific “notice withdrawal”.
[23] Both the Family Law Rules and the Rules of Civil Procedure use permissive language when speaking of the manner in which an offer may be withdrawn. As the language does not mandate that the parties must serve a notice of withdrawal it remains open to the court to determine whether an offer may be withdrawn in writing by a document other than a notice of withdrawal.
[24] An offer to settle may be implicitly withdrawn by a subsequent offer in writing that is less favourable to the opposing party.[^2]
[25] An offer is not terminated by a counter-offer or a rejection and where a party rejects an offer to settle and responds with a counter-offer that is not accepted, the party may accept the original offer to settle unless it has been withdrawn or the court has disposed of the claim or where the subsequent offer in writing is less favourable to the opposing party and is determined to be an implicit withdrawal of an offer to settle.[^3]
[26] In the present case the Applicant’s evidence was that the subsequent offers to settle made by the Respondent on equalization failed to take into account a payment received by him and was a “shrinking” of the Applicant’s share.
[27] In the circumstances I find that the subsequent offers to settle made between September 4, 2013 and October 6, 2015, by the Respondent which resulted in a “shrinking” of the Applicant’s share constitute implicit withdrawals of the offer to settle dated September 4, 2013.
[28] As such, I find that the Offer to Settle dated September 4, 2013, was withdrawn prior to service of the Acceptance of Offer on October 6, 2015, and the acceptance did not constitute a binding contract that can be enforced.
Disposition of Motion
[29] I hereby dismiss the motion.
[30] If the parties are unable to agree upon the costs of the motion they may file costs submissions not exceeding three pages in length to be delivered within 7 days of today’s date, failing which no costs shall be payable.
Justice S.J. Woodley
Released: December 8, 2015
[^1]: The Law of Civil Procedure in Ontario, Morden & Perell, First Edition, p. 573
[^2]: Supra, p. 573, footnote 124
[^3]: Ibid, p. 573m footnotes 125-128