CITATION: Petit v. Petit, 2016 ONSC 1566
NEWMARKET COURT FILE NO.: FC-15-47643-00
DATE: 20160304
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Jean-Luc Petit
Applicant
– and –
Michele Anne Petit
Respondent
Jaret Moldaver, for the Applicant
Michael J. Stangarone and Ryan Kniznik, for the Respondent
Melanie J. O’Neill, for the Children
HEARD: January 27, 2016
Ruling on Costs
jarvis j.:
[1] This Ruling deals with costs arising from a Ruling released February 2, 2016. That Ruling involved Motions by the parties for temporary custody of their children in the context of which parent should be granted exclusive possession of the matrimonial home. While each party had also requested other relief, some of which was ordered, the wife was, in my view, the successful party on the most important issue of the children’s well-being. She was awarded exclusive possession of the matrimonial home, the children to reside there.
[2] The wife served an Offer to Settle: the husband did not.
[3] The wife requested substantial indemnity costs of $14,600 inclusive of disbursements and HST. The husband submitted that no costs should be awarded because, in his view, success was divided. His Bill of Costs totalled $21,194.75 comprising fees ($18,048), disbursements ($707.42) and HST ($2,438.33). The scale of these costs was not indicated but it appears that it is full recovery.
[4] The wife’s Offer was dated January 7, 2016. It proposed that she be awarded exclusive possession of the matrimonial home by January 31, 2016. She did not request a temporary Order for custody but did propose that the children have access with their father according to the recommendations of the Offices of the Children’s Lawyer. This Offer focused on the children. It was open for acceptance for slightly over 24 hours after its service without any costs penalty, then open for acceptance thereafter but only on a full costs recovery basis.
[5] The husband argues that since the wife requested in her Notice of Motion relief that was not granted, and there were financial aspects to the Order made that were not contained in her Offer, she should be disentitled to costs pursuant to Family Law Rule 18 (4). It is noteworthy that, apart from some procedural directions made, the husband was unsuccessful on the issue which most impacted the children.
Analysis
[6] In an earlier Ruling on costs made in these proceedings dated September 24, 2015 McGee J. outlined the principles to be taken into consideration where Offers to Settle do not meet the criteria set out in Family Law Rule 18 (14), as well as parties being held accountable for their litigation positions or conduct, and a party’s ability to pay being relevant only to the quantum or scale of costs but not the successful party’s entitlement. I do not intend to repeat those comments but commend them to the parties. Of concern in my view, and it is relevant to the award I intend to make, is the absence of any Offer to Settle by the husband.
[7] In Blanchard v. Walker 2012 CarswellOnt 16857, 2012 ONCJ 799 [2012] O.J. No. 6269, [2013] W.D.F.L. 932, 222 A.C.W.S. (3d) 452, 25 R.F.L. (7th) 487 (OCJ), Curtis J. commented on the importance of Offers to Settle:
22 Offers to settle are a significant part of the costs landscape in family law in Ontario. They are important to the possible resolution of cases. In addition, they are important to determining costs.
23 Parties and their lawyers have a positive obligation to behave in ways which enable the court to move cases forward to resolution (Rule 2). Rule 2 (4) imposes a duty on parties and their lawyers to promote the primary objective of the rules to deal with cases justly (Rule 2 (2)). This includes taking appropriate steps to save time and expense (Rule 3 (3)). Offers to settle play an important role in saving time and expense by promoting settlements, focusing parties and often narrowing issues in dispute: Laing v. Mahmoud, 2011 ONSC 6737, [2011] O.J. No. 5134, 2011 CarswellOnt 12972 (Ont. S.C.J.), para.7.
[8] Similarly in F. (H.) v. H. (M.) Sherr J. observed,
4 …it should be a fundamental step in any family law case to serve at least one offer to settle. Parties and their counsel now have a mandate under subrule 2 (4) of the rules, to promote the primary objective of the rules; to deal with cases justly (subrule 2 (2)). Dealing with a case justly includes taking steps to save time and expense (subrule 2 (3)). Offers to settle play an important role in saving time and expense in a case. They are an important vehicle in promoting settlements, focus the parties and often narrow the issues in dispute.
5 There are consequences in the rules for not making or accepting reasonable offers to settle. Subrule 18 (14) sets out the costs consequences of not accepting an offer to settle that is as good as or better than the final result. When determining the reasonableness of a party’s behaviour in the case, clauses 24 (5) (b) and (c) of the rules direct the court to examine the reasonableness of any offer made, withdrawn or not accepted. This does not preclude the court from examining the failure of a party to make an offer to settle.
[9] It may well be that any Offer to Settle by the husband would not have differed from his position when the parties’ Motions were argued but in light of the evidence about the children and his own financial circumstances he should have reflected on the comments made by McGee J. already noted. In the course of argument on the merits, and again in costs submissions, the husband’s counsel referenced his client’s modest means. No doubt that is a relevant factor but the observations of Pazaratz J. in Izyak v. Bilousov, 2011 CarswellOnt 14392, 2011 ONSC 7476, [2011] O.J. No. 5814, [2012] W.D.F.L. 1818, [2012] W.D.F.L. 1819, [2012] W.D.F.L. 1822, 210 A.C.W.S. 143, 7 R.F.L. (7th) 358 (Ont. S.C.J.) are apposite,
54 In arriving at an overall award of costs which is fair and reasonable, the court must take into account the Applicant’s limited resources – as one of the relevant factors. But I return to the three primary objectives of costs orders:
To partially indemnify successful litigants for the cost of litigation;
To encourage settlement; and
To discourage and sanction inappropriate behaviour by litigants.
55 It is counter intuitive to suggest that these objectives are less applicable to litigants of modest (or no) means. To the contrary, those who can least afford to litigate should be most motivated to seriously pursue settlement, and avoid unnecessary proceedings. As Glithero J. noted in Balaban v. Balaban, 2007 CanLII 7990 (ON SC), 2007 CarswellOnt 1518 (Ont. S.C.J.), at paragraph 7: “…when a person’s financial position is such that they cannot really afford the cost of litigation, then there is all the more reason to attempt compromise of a meaningful nature.
[10] I have considered the provisions of Family Law Rule 24 (4), (5), (6) and especially (8) dealing with the factors to be considered in setting the amount of costs but have no intention of undertaking a line-by-line review of the wife’s Bill of Costs. As elsewhere observed by Aston J. in Delellis v. Delellis and Delellis, 2005 CanLII 36447 (ON SC), [2005] O.J. No. 4345 (Ont. S.C.).
[95] It is important to reiterate that when the court is fixing costs, it is not undertaking a simple mechanical exercise. Such an exercise would be inappropriate and in fact undesirable…
[11] Taking into account the facts that the wife was not entirely successful, the husband’s means (particularly as those involve his present financial circumstances) and the likelihood that the wife will owe the husband an equalization payment, it is my view that an award of $12,500 for costs is appropriate.
[12] Accordingly, the husband shall pay to the wife costs in the amount of $12,500, payment of which shall be suspended until the earlier of any sale of the matrimonial home (and paid from the husband’s share of the net proceeds of sale) or applied as a credit to any equalization payment that may be found owing by the wife to the husband.
Justice D.A. Jarvis
Date: March 4, 2016