ONTARIO
SUPERIOR COURT OF JUSTICE
PEMBROKE COURT FILE NO.: 14-D-566
DATE: 2015/12/11
BETWEEN:
Wayne George Daley
Applicant
– and –
Lezlie Jane Gowan (Daley)
Respondent
M. Peter Sammon, for the Applicant
Self-Represented
HEARD: Via Written Submissions
REASONS ON COSTS
Madam Justice B. R. Warkentin
[1] In my Reasons for Judgment dated November 2, 2015, I found that the Applicant was entitled to his costs of this proceeding and requested written submissions from the Applicant within 20 days and written submissions from the Respondent within 10 days thereafter regarding their position on costs. I received the Applicant’s submissions on November 2, 2015. I have not received any submissions from the Respondent.
[2] The Applicant was entirely successful in the Application. He seeks costs on a full indemnity basis of $24,721.74.
[3] With the exception of the claim for ongoing spousal support by the Respondent, the issues in this case dealt with the valuation date. The parties disagreed on that date, the Applicant claiming it was in the fall of 1999 and the Respondent claimed it was in May 2014.
[4] Because of the difference in their positions on the valuation date, there was no possibility of a mixed result on this issue and the related valuation of the parties’ net family properties; it was a win or lose scenario for both parties. This was the most significant part of the application.
General Principles of Costs
[5] An award of costs is a matter in the discretion of the court by virtue of s. 131(1) of the Courts of Justice Act, which provides:
Subject to the provisions of an Act or rules of court, the costs of and incidental to a proceeding or a step in the proceeding are in the discretion of the court, and the court may determine by whom and to what extent costs shall be paid.
[6] Rule 24 of the Family Law Rules provides that there is a presumption that a successful party is entitled to the costs.
[7] The factors that must be considered under Rule 24(11) are:
(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 signatures of the order;
(e) expenses properly paid or payable; and
(f) any other relevant matter.
Disposition
[8] The Applicant was the successful party on the issue of the valuation date. It flowed from that success, given the length of the parties’ marriage and the actions they took in 1999 to separate their financial affairs that the Applicant would succeed in the rest of his claims.
[9] It also relevant that when considering the award of costs that neither party retained counsel until the triggering event in May 2014 that sparked this application, as fully set out in my Reasons for Judgment. In other words, they had separated and reached a resolution regarding the division of their property without the aid of legal advice.
[10] No offers to settle were provided to me with the submission on costs. Counsel for the Applicant acknowledged that none of the other factors in Rule 24(11) were applicable in this case.
[11] In his submissions on costs, counsel for the Applicant argued, however, that the costs charged his client and set out in his Bill of Costs represent a substantially discounted rate. It was his position that his costs should not be further discounted by applying a partial indemnity assessment to that already discounted rate he charged the Applicant.
[12] The recent Ontario Court of Appeal case of 790668 Ontario Inc. v. D'Andrea Management Inc. [2015] O.J. No. 4018, 2015 ONCA 557, made the following comments about awarding substantial or full indemnity costs when a discounted rate was provided by counsel at paragraphs 22 and 23 of the reasons:
22 In Wasserman, Arsenault Ltd. v. Sone, 2002 45099 (ON CA), 38 C.B.R. (4th) 119, [2002] O.J. No. 3772 (C.A.) at para. 3-5 and in Boucher v. Public Accountants Council for the Province of Ontario, (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291, [2004] O.J. No. 2634 (C.A.) at para. 36, this court said that it is an error in principle to award partial indemnity costs that amount to substantial/full indemnity. See also Kim v. Rezai, 2015 ONSC 3140, where the successful defendant sought full indemnity, as explained at para 25: "given the low hourly rates charged by the Defendant's counsel." Justice Faieta refused to follow Mantella and Geographic Resources in light of this court's decisions.
23 In my view, it was an error in principle for the motion judge to award partial indemnity costs in the full amount of the actual costs paid. While a court has discretion to determine the size of the discount to a party's actual costs when awarding partial indemnity costs, with due consideration of the factors set out in rule 57.01(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, I am unable to see, on the facts in this record, a basis to depart from the ordinary rule of thumb that partial indemnity costs should be about one-third less than substantial indemnity costs.
[13] In light of this direction from the Court of Appeal, this is not a case in which an award of full indemnity costs is appropriate because of the discount provided to the Applicant by his counsel. Because none of the other factors were present as set out in Rule 24(11), this is a case where partial indemnity costs are appropriate.
[14] I have therefore applied a discount of 30% to the substantial indemnity costs proposed and award costs to the Applicant in the amount of $17,305.00 inclusive of HST and disbursements.
Madam Justice B. R. Warkentin
Released: December 11, 2015
PEMBROKE COURT FILE NO.: 14-D-566
DATE: 2015/12/11
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Wayne George Daley
Applicant
- and –
Lezlie Jane Gowan (Daley)
Respondent
REASONS ON COSTS
Warkentin J.
Released: December 11, 2015