Court File and Parties

COURT FILE NO.: FC-05-450-02 DATE: 20170621 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Travis Raymond Manklow, Applicant AND: Carly Lynn Smith, Respondent

BEFORE: THE HON. MADAM JUSTICE E.A. QUINLAN

COUNSEL: B. Degoldie, Counsel for the Applicant Carly Lynn Smith, Self-Represented

HEARD: By written submissions

Costs Endorsement

Overview

[1] On March 13, 2017 I released my reasons on the applicant father's motion to change. The father sought to reduce the quantum of child support payable for his 12-year-old son on the basis that he no longer earned $85,000 per annum, which was the amount imputed to him in 2014 following an uncontested trial.

[2] After considering all of the evidence, I was satisfied that an appropriate income to impute to the father for child support purposes on a go forward basis was $100,000.

[3] The respondent mother seeks costs for the motion and the steps leading to the hearing of the motion on a full recovery basis in the amount of $49,490.81. She seeks her legal costs and costs for representing herself. In the alternative, she seeks substantial indemnity costs to the date that she served her offer and full indemnity costs thereafter.

Background

[4] The litigation between the parties began in 2005. That year the court granted a final order that required the father to provide the mother with a copy of his income tax returns on a yearly basis. The father did not do so. As a result, the mother commenced a motion to change in April 2011. Ultimately, that motion to change was dealt with in January 2014 by way of an uncontested trial. Income was imputed to the father in the amount of $85,000, based on the mother's research into the amount an individual with the father's education, skills, training and work experience could earn.

[5] The father commenced this motion to change in June 2014. The father’s position in this most recent proceeding was that his income for support was either $45,000, $60,000 or $62,840; at the motion he argued that his 2016 income was $57,973.

[6] The mother provided the court with substantial materials that had been provided by the father by way of disclosure along with further research into income that a person with the father's education, skills, training and work experience could earn. The mother also provided evidence that the father receives some income from cash roofing jobs and firefighting. She provided evidence of the father's lifestyle. Ultimately, I was satisfied that an appropriate income to impute to the father on a go forward basis was $100,000.

Positions of the parties

The Mother’s Position

[7] The mother argues that she had to take significant time off work to attend court, prepare material, obtain information and evidence and understand the piece-meal disclosure provided by the father. The father's actions made it nearly impossible for the mother to ascertain the father's real income for support purposes and increased the complexity and costs of the proceeding. The mother's position on the issues throughout the case was reasonable; the father's was not. The mother was substantially successful on all issues set out in her offer. The mother incurred substantial legal costs and significant expenses representing herself. Costs were increased because the father brought this motion in Barrie; the mother lives in Sault Ste. Marie. Although no costs were ordered or reserved at previous steps, the mother argues she is additionally entitled to those costs. The mother’s position is that the hourly rate she seeks for her time is reasonable: she seeks reimbursement in accordance with her gross pay per hour in the amount of $18.65. The case was important to her as a reduction of child support would have been catastrophic to her on her income and as a single mother.

The Father’s Position

[8] The father challenges the mother's costs submissions on three major grounds:

a. the duration of time for which the mother seeks costs, including steps in the case where costs were not reserved;

b. the manner in which the mother’s costs have been calculated, both for all of her time as a self-represented person and also all of her counsel’s time, which effectively amounts to double recovery; and

c. the amount of costs claimed, which are excessive in relation to the issues in the proceeding, the results of the case and the length of the hearing.

[9] The father has supplied evidence of his costs for the entire proceeding which total $28,267.29, including disbursements and HST. A review of the father’s lawyer’s bill of costs shows that based on the interim accounts rendered, his costs for the motion alone are approximately $11,700.

[10] The father's position is that the father should pay the mother’s partial indemnity costs up to the mother’s offer ($3,974.16, being 50% of $7948.32) and substantial indemnity costs thereafter ($5,901.38 being 75% of $7,868.51) for a total amount of $9,875.54.

Legal Principles

General Principles

[11] Section 131 of the Courts of Justice Act, R.S.O. 1990, c.C.43 provides considerable judicial discretion on the issue of fixing costs. Rule 24 of the Family Law Rules provides a measure of guidance in the exercise of that discretion by enumerating certain factors that the court may consider in assessing costs.

[12] Section 24(11) of the Family Law Rules sets out the following factors for the court to consider in determining costs:

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;

e. Expenses properly paid or payable; and

f. Any other relevant matter.

[13] In Serra v. Serra, 2009 ONCA 395, at para. 8, our Court of Appeal provided these overarching comments with respect to costs rules:

Modern costs rules are designed to foster three fundamental purposes:

(i) To partially indemnify successful litigants for the cost of litigation;

(ii) To encourage settlement; and

(iii) To discourage and sanction inappropriate behaviour by litigants.

[14] The court’s role in assessing costs is not necessarily to reimburse the litigant for every dollar spent on legal fees. There is a component of reasonableness when costs awards are considered: Benetau v. Young, 2010 ONSC 33, at para. 13.

[15] As noted in Biant v. Sagoo, 2001 ONSC 3315, at para. 20:

The preferable approach in family law cases is have costs recovery generally approach full recovery, so long as the successful party has behaved reasonably and the costs claimed are proportional to the issues and the result.

Analysis

[16] The mother has claimed 246 hours to prepare affidavits for the motion. I find that the time she spent on the case is not proportionate to the issues in the proceeding. The endorsements in relation to the conferences do not reserve costs at any step in the proceeding. There is no principled basis for her to receive costs in relation to the earlier steps. As noted in Islam v. Rahman, 2007 ONCA 622, at para. 2:

Rule 24(10) of the Family Law Rules provides that the judge who deals with a step in a case shall decide who, if anyone, is entitled to costs. If a party who has served an offer to settle the case as a whole wishes that fact taken into consideration in relation to a particular step, it is incumbent on that party to raise that issue with the judge who deals with that step. In this case, various steps were taken (e.g. motions, conferences) in relation to which either there was an endorsement that there be no order as to costs or the issue of costs was not addressed. In the absence of a specific order for costs in favour of the respondent, the trial judge should have disallowed costs claimed by the respondent in relation to such steps.

See also Bortnikov v. Rakitova, 2016 ONCA 427, app’n for leave to appeal dismissed [2016] S.C.C.A. No. 331.

[17] I have reviewed the mother’s lawyers’ bills of costs and compared it to the mother’s outline of her own costs for preparation and attendances. I agree with the father's position that the mother has sought costs for her own hours of preparation and attendances at conferences and at the motion and has also claimed her lawyer’s complete cost for the majority of the case. I am satisfied that this is a duplication of costs and that none of the mother’s costs for preparation or for attendances, except for her disbursements for attendances in relation to the motion as set out below, are properly claimed as costs.

[18] The mother’s lawyer has claimed reasonable costs for preparation for and attendance at the motion. Lengthy and detailed materials were prepared that assisted the court. As noted in the father’s submission, prior to service of the offer, these costs, inclusive of HST, total $7,948.32. After service of the offer, the costs total $8,902.36, inclusive of the cost of preparing costs submissions (which were not included in the father’s calculations), disbursements and HST.

[19] Rule 18(14) of the Family Law Rules sets out the costs consequences of the failure to accept an offer. Although the mother did not achieve an increased cap on the father's contribution to extraordinary expenses, in other respects she obtained an order that was more favourable than her offer. Accordingly, I am satisfied that the costs consequences set out in rule 18(14) apply.

[20] The disbursements sought by the mother include amounts for a computer, a stamp, a coffee, ink cartridges and file folders. She seeks mileage, including attendances for legal consultations and for all of her attendances from Sault Ste. Marie to Barrie. She seeks her hotel bills. The disbursements sought are excessive and most relate to the period of time during which the matter was proceeding through the various conferences.

[21] The only disbursements claimed personally by the mother that I find are appropriate relate to two attendances in Barrie for the purpose of preparing for and attending at the motion. These include the cost of shipping documents to Barrie, renting a vehicle on one occasion, mileage for one occasion and one night at a hotel. These disbursements total $1,206.08.

[22] I am satisfied that the mother should receive her lawyer’s costs on a partial recovery basis up to the offer ($3,974.16, being 50% of $7,948.32) and her costs on a full recovery basis thereafter ($8,902.56). In addition, the mother’s personal disbursements are $1,206.08. The total costs are $14,082.80. I am satisfied that this total amount of costs is a fair and reasonable amount and an amount the losing party could expect to pay.

[23] The father argues that an order that costs are enforceable through the Family Responsibility Office would create a financial hardship to him. Given my findings in relation to the father's ability to earn income, I am not satisfied that this is the case.

Conclusion

[24] Accordingly, the father shall pay to the mother costs in the amount of $14,082.80. The costs of this motion relate to child support and so can be enforced as child support through the Family Responsibility Office.

QUINLAN J. Date: June 21, 2017