Court File and Parties
COURT FILE NO.: FC-08-2294-1
DATE: 2018/05/23
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: SHELLY JOAN CRUMP, Applicant
-and-
WILLIAM GLEN CRUMP, Respondent
BEFORE: Madam Justice D. Summers
COUNSEL: Bruce F. Simpson, for the Applicant
Michael H. Barnhart, for the Respondent
HEARD: November 28, 2017
COSTS ENDORSEMENT
Overview
[1] This was an application under the Divorce Act, 1985, c. 3 (2nd Supp.) for custody, access, child support for two children, a determination of in loco parentis for the eldest child, and the equalization of net family property. The parenting issues were resolved by Minutes of Settlement in April, 2017 and the remaining issues settled in November, 2017, on the day the trial was scheduled to proceed.
[2] The Applicant seeks partial indemnity costs in the amount of $12,766.00 inclusive of disbursements and HST. She argues that she was the successful party and that the Respondent behaved unreasonably.
[3] The Respondent says that success was divided and no costs should be payable.
Success
[4] Offers to Settle are a yardstick for measuring success as well as being a prime consideration when determining the amount of costs to be ordered. See Sims-Howarth v. Bitcliffe, 2000 CanLII 22584 (ON SC), [2000] O.J. No 330, (S.C.J.). Here, the Applicant made an Offer to Settle in March, 2016 under R. 18 of the Family Law Rules, O. Reg. 114/99 (the “FLR’s”). The Respondent did not make an Offer.
[5] The parties’ settlement was not as favourable to the Applicant as the terms of her offer, therefore, the costs consequences of R. 18(14) do not apply. Nevertheless, in the exercise of the court’s discretion over costs, R. 18(16) provides that I may consider any offer made in writing. In this regard, I take into account the Applicant’s formal offer as well as an earlier informal offer made in her February, 2016 Settlement Conference Brief.
[6] A significant issue driving the litigation in this case was the Respondent’s resistance to paying child support. In March, 2016, he was ordered to pay the Guideline amount for the minor child of the marriage commencing April 1, 2016, without prejudice to the Applicant’s claim to receive support for both children retroactive to September, 2014. The Respondent’s resistance to paying Guideline support for the minor child was unreasonable.
[7] Both the Applicant’s formal and informal offers included terms for payment of Guideline support for two children retroactive to September 1, 2014, whereas the Minutes of Settlement stipulate table support for only the minor child of the marriage but includes a further term in a separate paragraph that requires the Respondent to make an additional child support payment to the Applicant of $100.00 each month. When the Minutes were filed over the bench, counsel explained that the provision requiring the additional monthly payment was deliberately generic. It represented a compromise made by the parties to resolve the issue of in loco parentis for the older child. The settlement further provides for a lump sum payment from the Respondent to resolve the issue of retroactive child support.
[8] Sharing the value of the jointly owned matrimonial home was the other significant issue behind the litigation. The Respondent insisted the home had been a gift to him from his mother and refused to share its’ value with the Respondent. This dispute was driven by emotion, not law and should have been resolved long before the day of trial. His behaviour in relation to this issue was unreasonable.
[9] The parties also disagreed about the payment of certain house related expenses including property tax arrears, repair costs and the legal fees incurred in the power of sale proceedings.
[10] The payment terms offered by the Applicant generally reflected whether they were incurred before separation or after and whether they were incurred for the preservation of a joint asset. The Minutes of Settlement executed provided for payment of these costs in a way that was, in many respects, comparable to the terms proposed by the Applicant.
[11] Overall, I find the Applicant’s offers were reasonable.
[12] It is difficult to determine success when the parties have made a series of compromises in order to reach a settlement but not impossible. When the outcome here is measured in relation to the offers made by the Applicant, I find that she was markedly more successful than the Respondent and she is entitled to some costs. Put another way, divided success does not necessarily lead to each party bearing their own costs as the Respondent asks. In situations of divided success, R. 24(6) of the FLR’s allows the court to apportion costs as appropriate.
[13] The Respondent did not make an Offer to Settle and I find his failure to do so was unreasonable. Rule 2 of the FLR’s imposes a duty on parties and their lawyers to promote the primary objective of the rules to deal with cases justly. This duty includes taking appropriate steps to save time and expense. Offers to Settle play an important role in saving time and expense by promoting settlements, focusing the parties and often narrowing the issues in dispute. The failure to serve an offer to settle will be an adverse factor when assessing costs. See Laing v. Mahmoud, 2011 ONSC 6737.
Quantum
[14] I have considered the required factors listed in R. 24(11) of the FLR’s. I find that the issues were important to the parties but they were not difficult or complex and the Respondent’s unreasonable behaviour led to this litigation continuing for as long as it did. His position regarding the matrimonial home and support for the minor child of the marriage were not supported at law and he did not make an offer to settle. It is difficult to interpret his last minute willingness to negotiate a settlement as any other than damage control. Behaving in that way cannot be seen as a reasonable way to conduct litigation.
[15] Both counsel provided a Bill of Costs. The hourly rates charged for senior counsel were reasonable. Each has 40 plus years at the bar. The account detail provided by the Applicant’s counsel indicates he spent a total of 81 hours working for the Applicant after assuming carriage of the file in November, 2015. The cost claim is based on 41 hours at a partial indemnity rate plus disbursements. For comparison purposes, the Bill of Costs submitted by the Respondent’s counsel discloses total costs of $6,382.00 for 24 hours. It was also calculated on a partial indemnity basis. The summary of work done by Respondent’s counsel relates only to trial preparation.
[16] The Bill of Costs provided by the Applicant’s counsel suggests that some recovery is sought for prior steps in the case, however, a review of the record confirms that with the exception of the Case Conference in 2015, where costs were reserved to the trial judge, all subsequent settlements and orders were silent on the issue of costs. The Ontario Court of Appeal has been clear that a trial judge should not make a costs order relating to earlier steps in the proceeding where there was silence on the issue. See Bortnikov v. Rakitova, 2016 ONCA 427. I, therefore, take into consideration the extent to which the amount claimed may overlap with prior events where costs were not addressed and adjust accordingly.
[17] The Court of Appeal, in Serra v. Serra, 2009 ONCA 395, has also confirmed that modern costs rules are designed to foster three fundamental purposes, namely to partially indemnify successful litigants for the cost of litigation, to encourage settlement, and to discourage and sanction inappropriate behaviour by litigants, bearing in mind that the awards should reflect what the court views is a fair and reasonable amount that should be paid by the unsuccessful party.
[18] For the reasons and considerations set out above, I find it fair and reasonable that the Respondent pay costs to the Applicant in the amount of $7,500.00 inclusive of disbursements and HST. Payment by the Respondent shall be made forthwith.
Madam Justice D. Summers
Date: May 23, 2018
COURT FILE NO.: FC-08-2294-1
DATE: 2018/05/23
ONTARIO
SUPERIOR COURT OF JUSTICE
RE: SHELLY JOAN CRUMP, Applicant
-and-
WILLIAM GLEN CRUMP, Respondent
BEFORE: Madam Justice D. Summers
COUNSEL: Bruce F. Simpson, for the Applicant
Michael H. Barnhart, for the Respondent
ENDORSEMENT
Madam Justice D. Summers
Released: May 23, 2018