Overview

[1] The Applicant requests her costs from the Respondent for the case conference of October 31, 2016, the January 31, 2017 motion, and the May 25, 2017 motion. She seeks these costs on a full recovery basis in the total amount of $55, 927.42 inclusive of disbursements and HST. This total includes $4,982.00 in fees incurred with an accountant to assist in determining the Respondent’s income.

[2] The Applicant started this motion in October 2016 seeking, among other things, an order for ongoing and retroactive child and spousal support, an order determining the parenting schedule of the parties’ son; Samuel Dallaire, and an order that the Respondent provide full financial disclosure.

[3] The Applicant maintains that she has been successful at all three events and that she is entitled to her full costs due to the Respondent’s intentional and unreasonable conduct; or in the alternative, based on a finding of bad faith conduct on his part.

[4] The Applicant initially sought relief at the case conference on October 3, 2016. At that time, the Respondent contested this Court’s jurisdiction to deal with the divorce proceedings. Despite his opposition to the Courts jurisdiction, the case conference proceeded and the Respondent was ordered to provide a sworn financial statement as well as documentary proof of his income, assets, and debts within 30 days. In my decision of July 6, 2017, I found that the Respondent’s initial position that Quebec had jurisdiction had some merit. Costs of the case conference were reserved for the motions judge.

[5] On October 4, 2016, the Quebec Superior Court heard the Applicant’s motion challenging the jurisdiction of that Court to deal with the divorce proceedings brought by the Respondent in that province. Justice Tessier ruled in favor of the Applicant on October 18, 2016. At this time, the Applicant’s original motion was scheduled to proceed on January 31, 2017 to address disclosure, retroactive and ongoing arousal and child support.

[6] On January 10, 2017, the Respondent served the Applicant with an Amended Answer indicating that he would not contest Ontario’s jurisdiction to determine the issue between the parties, and the Applicant believed that the issue was settled.

[7] On January 18, 2017, the Respondent served motion material returnable on January 31, 2017 which included a copy of the new Amended Amended Answer where he once again disputed the jurisdiction of this Court. The Applicant was forced, on short notice, to defend this second challenge to this Court’s jurisdiction to hear this matter. The Applicant notes that the Respondent had still not provided the disclosure ordered at the case conference in October.

[8] I dealt with the motion on January 31, 2018 and determined very quickly that this Court had jurisdiction. The Respondent had not come prepared to argue the substantive issues of the motion and the motion was adjourned on terms to May 25, 2017. There was an order for further disclosure. I reserved the costs of that attendance to the hearing of the motion.

[9] Despite my order for disclosure, the Applicant maintains that the Respondent did not provide her with all of the disclosure requested and that the disclosure provided was not timely and was incomplete. Most critically, the Applicant maintains that the Respondent failed to provide full details of his bonus structure and of the bonus payments owed to him in 2017. The Applicant maintains that the Respondent continued to misrepresent his income in his responding materials for the motion to be heard on May 25, 2017.

[10] The Applicant submits that it was only as a result of her providing a document about the Respondent’s bonus plan that was in her possession from the marriage and after consulting with an accountant that she was able to calculate the Respondent’s deferred bonuses. The Applicant says that the Respondent’s failure to make full disclosure and his continued misrepresentation of his income forced her counsel to spend considerable time and energy determining the Respondent’s bonus structure and calculating the deferred bonus he was entitled to in 2017, including obtaining advice from an accountant at Collins Barrow.

[11] The Applicant claims that she was successful on the May 25, 2017 motion. While I dismissed her request that the Respondent not be permitted to make submissions on the financial issues of the motion and to strike his Answer for failing to comply with court orders for disclosure, I indicated that this was a matter for costs. The Respondent was successful in obtaining an order for retroactive and ongoing child and spousal support based on the income figures proposed by her counsel. She claims that the portion of her motion for determination of the parenting schedule for Samuel was adjourned on the consent of the parties with a proposal for mediation.

[12] The Applicant made a number of Offers to Settle. Her fourth and final offer contained support calculations that were in line with the amounts awarded on the motion. The Applicant maintains her Offer to Settle was reasonable in the circumstances. In contrast, the Applicant notes that amounts contained in the Respondent’s Offer to Settle were well below the amounts ordered by me.

[13] The Applicant notes that the time spent on the case was significant, but necessary due to the Respondent’s conduct; particularly in relation to the Respondent’s decision to re-litigate the issue of jurisdiction and in determining the Respondent’s income due to his untimely and incomplete disclosure.

[14] The Applicant’s counsel was called to the bar in 1986. Her hourly rate is $460 per hour and was $450 per hour in 2016. The Applicant’s lawyer was assisted by an associate called to the bar in 2014 at a rate of $210 per hour as well as by a law clerk at a rate of $105 per hour.

The Respondent’s Position

[15] The Respondent agrees to pay the Applicant her costs of $3,285.00 on a full indemnity basis for the case conference given the fact that the conference dealt with the jurisdiction issue; a point which he clearly lost. He claims that the balance of the costs claimed by the Applicant are excessive given the results obtained during the motion.

[16] The Respondent admits that he completely lost the jurisdiction issue on January 31, 2017 but points out that the argument was very brief. The parties then negotiated the terms of an adjournment to allow the husband to properly address the support issues and came to an agreement that the Respondent husband would advance the sum of $40,000.00 to the Applicant.

[17] The Respondent submits that the Applicant was not successful on the relief she sought in her Amended Notice of Motion. She first sought an order preventing him from making any submissions during the motion as well as an order striking his pleadings. Submissions were made on those two points and those requests were rejected. The Applicant then sought a change to the joint shared custody agreement that existed for at least 12 months prior to the motion. Submissions were actually made on this issue and were rejected due to a lack of evidence by the Applicant. The Respondent had provided evidence on the issue of the joint custody agreement and the stability of their son with regards to the custody situation.

[18] The Respondent underlines that the Applicant sought retroactive and child and spousal support from September 2015 to June 2016 totaling over $250,000.00 This particular request was addressed at length in the Applicant’s materials and her counsel’s submissions. He says that the Applicant was completely unsuccessful on this point.

[19] The Respondent submits that the issue of retroactive support was unreasonable and prevented the parties from resolving the child and spousal support issues on an interim basis. The Applicant’s requests regarding life insurance, medical and dental coverage proceeded on consent without any debate. The Respondent consented to the Applicant having exclusive possession of her home located in Ottawa, Ontario.

[20] In his Notice of Motion, the Respondent sought joint shared custody as per the status quo and the determination of the spousal and child support obligations. While I did not accept his calculations, he notes that I did order the Respondent to pay child support from July 1, 2016 to December 31, 2016 based on the set-off amount contained in one possible scenario in his factum.

[21] The Respondent notes that he already paid to the wife, a minimum of $87,000.00 as a contribution to support. He has paid income tax on the amount of support paid and must finance the tax until next year. The issues of past credits and other credits have not been agreed to by Counsel.

[22] The Respondent acknowledges that the Applicant was more successful than he was with respect to the issue of support. Nevertheless, he maintains that this is not a case where the Applicant is entitled to full indemnity costs. He repeats that the Applicant’s decision to claim arrears for spousal and child support beyond the date of her application made the settlement of the motion impossible.

[23] The Respondent emphasizes that the Applicant had all of the necessary information to determine his income and I was able to make that determination despite allegations that he had not cooperated with divulging his financial information. The Respondent maintains there was no reason to hire an expert to review his income nor was there any reason to have three lawyers working on such a file.

[24] The request for a compensatory model for support purposes was deemed to be a triable issue, another point in which the Respondent claims success.

[25] The Respondent concedes that his arguments with respect to his cash flow were rejected and he submits that he be ordered to pay $3,285.00 plus HST for the case conference as well as the sum of $10,000 plus HST for the motions on January 31, 2017 and May 25, 2017. He also argues that it is not appropriate to award the Applicant a recovery for disbursements in the context of this litigation given that both parties will necessarily incur such expenses.

In Reply

[26] The Applicant argues that the Respondent has failed to acknowledge the amount of effort that was required by her to respond to the materials on the issue of jurisdiction on the January 31, 2017 motion. As for the short time that the attendance required on this matter, the Applicant maintains that this speaks to the unreasonableness of the Respondent’s position and to the response provided by her in her affidavit and factum. The attendance was so brief because the Respondent was unprepared to address any issue on the motion other than the question of jurisdiction. The Applicant maintains that she is entitled to costs thrown away way for preparing to argue those issues.

[27] The Applicant maintains that the true impediment for reasonable settlement of the issues of child and spousal support was the Respondent’s refusal to agree to a reasonable amount of support based on his income. She notes that the amounts awarded by me for support are nearly double those proposed by the Respondent in his offer.

[28] The Applicant submits that her disbursements were all reasonably incurred and should properly form part of my decision as to costs. Of this amount, $4,982.00 plus HST was incurred to retain the services of an accountant to calculate the Respondent’s income. She says that the services of an expert was required to determine the Respondent’s income and that up until the date of the motion and the hearing of the motion itself, the Respondent continued to misstate his income and failed to acknowledge that he would be receiving a deferred bonus later in 2017.

[29] Lastly, the Applicant refers to the Respondent’s continued failure to comply with orders for disclosure. She notes that he was late in providing his cost submissions. As of the date of the Applicant’s costs submissions, namely August 16, 2017, the Respondent had not provided her with any child or spousal support for the month of August. She identifies this as yet another example of the Respondent’s persistent disregard for court orders and a further indication of his bad faith.

Analysis and Conclusion

[30] Costs awards should reflect what the Court view as a fair and reasonable amount to be paid by the unsuccessful party.[^1] There is no issue with respect to the costs of the case conference in the amount of $3,285.00 plus HST or ($3,712.05) for the case conference in October 2016.

[31] I cannot make a finding of bad faith on the part of the respondent so as to require him to pay full indemnity basis beyond what has been agreed to. Even though that issue required little court time, I conclude however that the Applicant is entitled to her costs for responding to the January 31 jurisdiction motion on a substantial indemnity basis. After indicating that he did not contest the issue of jurisdiction and having filed an Amended Answer to that effect, the Respondent relied on a narrow interpretation of the Quebec decision and once again revived the jurisdiction question at the January 31 motion. He was not then prepared to respond to the Applicant’s motion seeking support and other relief. While he did agree to advance $40,000 in support as a term of the adjournment, the Respondent ignores the fact that the Applicant needlessly incurred costs to argue the jurisdiction issue and to respond to the evidence filed by him. Her counsel had prepared to argue the support issues with incomplete information, and some of those costs were thrown away. Her original arguments had to be substantially modified as additional financial disclosure was received.

[32] I note the Respondent’s failure to provide any information with respect to his own costs in this matter which undermines his claims that the Applicant’s costs are excessive. I agree however that it was not necessary for the applicant to have three counsel on the file and that the time docketed for two counsel, namely over 88 hours, in preparation for the January 31 motion contains an element of duplication. I fix the Applicant’s costs for the jurisdiction motion on January 31, 2017 on a substantial indemnity basis in the amount of $10,000.00 inclusive of HST. I assess her costs “thrown away” for that date at $5,000.00.

[33] As for the motion heard on May 25, 2017, there was a divided success. The Applicant was not successful in changing the parenting regime for Samuel. While the parties may have agreed to mediate this issue, it was only after I pointed out that the evidence before me did not justify the request made by the Applicant.

[34] I refused the Applicant’s request to strike the Respondent’s pleading and to prevent him from making any submissions on the financial issues.

[35] A considerable amount of time was spent on the issue of retroactive support and on applying a compensatory approach to calculating spousal support. Once again, the Applicant was not successful in obtaining retroactive support to the date of separation. I determined that the entitlement to compensatory support was a triable issue.

[36] There is no question that the Applicant was the more successful party on the quantum of child and spousal support. This was a challenging issue given the structure of deferred bonus payments received by the Respondent. The Respondent attempted to limit his income by excluding a bonus that he had every reason to believe would be payable later this year having regard to his historical income pattern. Given the mixed results, I fix the Applicant’s costs for attendance on the motion at $6,000.00 inclusive of HST.

[37] I accept that the retention of an expert was a reasonable expense in this case having regard to the complicated structure of the Respondent’s income and deferred bonuses. I allow the disbursements of $4,982.00 + HST ($5,629.66) for Collins Barrow and an additional amount of $559.00 + HST ($631.87) for the process server. I therefore order the Respondent to pay to the Applicant her costs which I fix at a total of $24,712.05 for fees and $6,261.53 for disbursements.

Mr. Justice Robert N. Beaudoin

Released: September 22, 2017

CITATION: Obam Dallaire v. Dallaire, 2017 ONSC 5608

COURT FILE NO.: FC-16-1482

DATE: 20170922

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

DIANE ISABELLE OBAM DALLAIRE

Applicant

– and –

ERIC DALLAIRE

Respondent

decision on costs

Beaudoin J.

Released: September 22, 2017

[^1]: Serra v. Serra, 2009 ONCA 395, 66 R.F.L. (6th) 40

Obam Dallaire v. Dallaire, 2017 ONSC 5608

Case Summary

Overview

The Respondent’s Position

In Reply

Analysis and Conclusion

Judge

Counsel

Parties

Areas of Law

Fact Patterns

Financial Outcomes

Issues