Court File and Parties

COURT FILE NO.: FC-13-2811 DATE: 2016/06/06 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Robert Andrew Crowther, Father AND Lorena Maria Pasian, Mother

BEFORE: Justice A. Doyle

COUNSEL: Linsey Sherman, Counsel for the Father Rod Cross, Counsel for the Mother

HEARD: WRITTEN SUBMISSIONS

Costs Endorsement

[1] The Court rendered a decision on a motion by the Respondent mother regarding child support. The Court ordered that the Applicant father pay the following:

• child support in the amount of $1,492 (CDN) based on the father’s income $106,212.36 CDN retroactive to August 1, 2015 and he was to contribute $2,000 per year for post-secondary educational costs;
• the mother must provide regular status reports including transcripts and confirmation of attendance at school in September and January of each year;
• if Sara attends a post-secondary educational institution, the mother must provide information to the father including information regarding the cost, her income and her contribution through student loans, bursaries, etc.;
• the father will have to keep the mother advised of his efforts to find work and advise of any contract work. Once he finds full time employment, the child support can be varied at that time. If the parties do not agree on the amount, then the matter can be returned this court which remained seized;
• the father will comply with the separation agreement to provide proof that he has maintained a life insurance policy with the face amount of $300,000 designating the mother as irrevocable beneficiary.

[2] The Court requested written submissions regarding costs if the parties could not agree on the quantum of costs.

[3] After reviewing the costs submissions and having considered the factors set out in Rule 24 of the Family Law Rules, O. Reg. 114/99 (the “Family Law Rules”), the Court orders no costs.

Mother’s Position

[4] The mother submits that there was divided success and hence she is entitled to costs on a partial indemnity basis in the amount of $8,000 to $10,000.

[5] In July 2014, the mother requested that the father contribute $2,000 per year per child towards post-secondary education of the children. The Court found that this request was “not an unreasonable amount”.

[6] Although the father was successful in the retroactive credit of support, he was only partially successful on the amount of the credit.

[7] The mother was successful on her request that the father provide evidence that she is the irrevocable beneficiary of his life insurance policy.

[8] Her offer of April 13, 2015 offered that the father pay $1,545 US per month and he pay $2,000 per year for post-secondary and life insurance would be reduced to $100,000.

[9] On May 27, 2015, the father offered to continue to pay the $1,545 US until he obtained new employment at which time, support would be adjusted by him. He also offered to pay $2,000 per year per child for post-secondary education and insurance would be reduced to the face amount of $100,000.

[10] The mother was not prepared to allow the father to unilaterally determine the adjusted amount once he obtained employment.

[11] She initiated these proceedings to obtain a contribution of $2000 per year per child from the father. The matter was almost resolved when the father left his job voluntarily and brought a motion to terminate support. This stalled the negotiations.

[12] The mother’s total costs were $14,820 plus $273 in disbursements.

Father’s position

[13] The father is seeking his costs in the amount of $27,019.12 inclusive of disbursements which represents his costs on a partial indemnity basis up to the date of his offer of May 27, 2015 (“offer”) and full recovery thereafter.

[14] His offer would have him continue to pay $1,545 USD per month with child support to be adjusted by him when he commenced employment in England, $2,000 per year per child for post-secondary education and a reduction of the face amount of the life insurance to $100,000.

[15] In her letter dated June 10, 2015, the mother responded that the child support amount be renegotiated when he obtained new employment.

[16] In his letter dated June 23, 2015, among other things, the father stated he did not wish to renegotiate the amount.

[17] In her letter of July 6, 2015, the mother indicated she was prepared to wait to negotiate the adjusted support based on his new income and that the other terms were acceptable.

[18] There is no evidence of other communication until the mother’s lawyer email dated August 17, 2015 to the father’s counsel asking for her available dates for a motion. The father’s lawyer’s response was that the motion is premature until the father found employment but he was willing to continue to pay $1,545 US per month plus $2,000 per year for post-secondary education.

[19] In the mother’s letter dated September 14, 2015, the mother indicated her frustration that the father did not pay the full amount of $1,545 and he had short changed her in the past two years. In addition, he had not paid the amount of $2,000 per year for the past two years for Aidan’s educational costs.

[20] In the father’s letter dated Sept 25, 2015, he indicated that he will pay the university when funds become available and will cover the shortfall of child support.

Legal Principles

[21] The modern costs rules are designed to foster three fundamental purposes:

• to partially indemnify successful litigants for the cost of litigation
• to encourage settlement
• to discourage and sanction inappropriate behaviour by litigants

See Fong v. Chan (1999), 46 O.R. (3d) 330 (C.A.), at para. 22; and Serra v. Serra, 2009 ONCA 395, 66 R.F.L (6th) 40, at para. 8.

[22] Costs awards should reflect “what the Court views as a fair and reasonable amount that should be paid by the unsuccessful parties”. See Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291 (C.A.), at para. 24.

[23] The Court retains discretion when ordering costs within the framework of the Family Law Rules. See M. (C.A.) v. M. (D.) (2003), 67 O.R. (3d) 181 (C.A.) [M. (C.A.)].

[24] Rule 24 of the Family Law Rules creates a presumption of costs in favour of the successful party. Rule 24(11) sets out the factors that a Court shall consider in determining costs.

[25] Rule 18 of the Family Law Rules deals with the cost consequences of failure to accept an offer, and allows the Court discretion to take into account any written offer to settle, the date it was made and its terms. Specifically, Rule 18(14) states:

(14) A party who makes an offer is, unless the Court orders otherwise, entitled to costs to the date the offer was served and full recovery of costs from that date, if the following conditions are met:

(1) If the offer relates to a motion, it is made at least one day before the motion date. (2) If the offer relates to a trial or the hearing of a step other than a motion, it is made at least seven days before the trial or hearing date. (3) The offer does not expire and is not withdrawn before the hearing starts. (4) The offer is not accepted. (5) The party who made the offer obtains an order that is as favourable as or more favourable than the offer.

[26] Rules 18(15) sets out the burden of proof:

(15) The burden of proving that the order is as favourable as or more favourable than the offer to settle is on the party who claims the benefit of sub rule (14).

Analysis

Success

[27] The parties appeared very close to resolving the matters in the summer of 2015 and in fact, the mother’s lawyer’s letter of June 10, 2015 indicated “our two offers are not that far apart” and in his July 6, 2015 letter, he states that “other than this I believe we are settled”.

[28] The parties’ offers both agreed on the sum of support to be paid until the father found full time employment in England.

[29] They were apart on certain issues such as the father had to provide proof of his life insurance policy, the mother wanted to ensure that she had input in the adjusted child support amount when he found work in England and the determination of income of the father.

[30] The father’s lawyer’s letter dated August 19, 2015 stated that they wished to wait until he obtained his job in England and that the matter would be settled on a final basis. He agreed to pay the $1,545 USD and $2,000 as his contribution per year per child for post-secondary education.

[31] In September 14, 2015, Mr. Cross’ letter indicates that the father had not paid the full monthly amounts and has not yet paid the $2,000 per year for Aidan’s last two years.

[32] Although the parties were close, the father’s failure to honour his agreement and postponement of the matter until he obtained work was not palatable. He still had not paid his share of educational costs. In addition, and most importantly, the mother should have input in the amount that he will pay once he becomes full employed.

[33] In conclusion, upon reviewing the various offers to settle and the correspondence, the Court finds that there has been divided success for the following reasons:

• the parties were very close to resolution but the mother requested a contribution of $2,000 in July 2014 and she was successful on this point;
• in addition, his offer provided that he alone would control the adjustment of child support upon his obtaining full time employment;
• the Court ordered that the father provide proof of the designation of the mother as irrevocable beneficiary of the life insurance policy; and
• the father was successful with respect to support as the Court reflected the child support payable based on his income which was less than he was prepared to pay.

[34] None of the offers presented by either party entitle either of them to full recovery of costs under Rule 18, as the offers were not as favourable or more favourable than the final award.

[35] In considering the factors set out in 24(11), I have considered the following:

(i) The importance, complexity and difficulty of the issues: This matter involved some complexities, as dealing with the determination of the father’s income, imputation of income and educational costs.

(ii) The reasonableness or unreasonableness of each party’s behaviour in the case: The Court can also review the reasonableness of the parties’ position in accordance with rule 24(11)(b). Even though the father had agreed to pay his share of the post-secondary expenses, the father offered this amount but did not pay the same until October 2015 at the time the motion date was being set.

(iii) The lawyer’s rates: I find the lawyers’ rates reasonable given their extensive experience in family law. There is no explanation why the father had four lawyers working on his file.

(iv) 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: There is disparity between each of the party’s respective lawyer’s accounts. The mother’s bill of costs is more reasonable considering the time spent on this matter. Her total amount is $14,820 whereas the father total bill $32,326 which is more than twice the cost. The amount at stake was not significant and the amount spent by the father for a small claim of $2,000 per year for educational costs is not proportional to the issues;

(v) expenses properly paid or payable: The disbursements appear appropriate except the father’s photocopying costs appear high.

[36] Therefore, there will be no costs ordered.

Madam Justice A. Doyle Date: June 6, 2016