CHATHAM COURT FILE NO.: 11917/12 DATE: 20181005 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Willow Elizabeth Kelly, Applicant AND: Thomas James Kelly, Respondent

BEFORE: Howard J.

COUNSEL: Jonathan M. Quaglia, for the Applicant Thomas James Kelly, acting in person

HEARD: August 28, 2018

RULING ON GARNISHMENT HEARING

Overview

[1] This ruling, made pursuant to rule 29(19) of the Family Law Rules [^1], arises out of a garnishment hearing that was held before me on August 28, 2018.

[2] Following a six-day trial in this matter, the court released its reasons for judgment on December 19, 2017.

[3] By her request for garnishment dated July 4, 2018, the applicant seeks to enforce by way of garnishment the sum of $384,269.38, which is the amount claimed as being owing under the trial judgment, as particularized in the Statement of Money Owed sworn July 4, 2018.

[4] By a second request for garnishment dated June 20, 2018, the applicant also seeks to enforce by way of garnishment the additional sum of $82,169.56, which is the amount claimed as being owing for costs of the trial under the costs endorsement released May 14, 2018, as particularized in the Statement of Money Owed sworn June 20, 2018.

[5] For reasons set out in his dispute sworn July 27, 2018, the respondent (Mr. Kelly) alleges that the applicant’s interest calculations have been performed incorrectly and that, for a variety of reasons, the applicant is not entitled to certain sums as claimed.

[6] For the reasons that follow, I would dismiss the dispute pursuant to rule 29(19)(1) of the Family Law Rules.

Factual Background

[7] This proceeding has had a lengthy history in this court.

[8] The application was commenced in April 2012. It came on for trial before Raikes J. commencing in March 2017. The trial lasted six days and was completed in June 2017. The issues involved, among other things, arrears payable for spousal support, arrears payable for child support, and equalization of the parties’ net family property.

[9] For comprehensive reasons for judgment released December 19, 2017, Raikes J. concluded as follows:

Therefore, for the above reasons, I conclude as follows:

1. The amount payable by Willow [the applicant mother] for child support from January 1, 2011 to April 30, 2018 is $111,556.
2. The amount payable by Willow to Thomas [the respondent father] for post-separation expenses is $3,500.
3. The amount payable by Thomas to Willow for equalization is $333,538.78 less any monies already paid toward equalization.
4. The amount payable by Thomas to Willow for spousal support for the period from January 1, 2012 to April 30, 2018 is $125,922.
5. The amounts payable by Willow to Thomas shall be set-off against the amount payable by Thomas to Willow for spousal support.
6. Thomas shall pay to Willow the difference after set-off of $9,866.
7. Thomas shall pay spousal support to Willow in the amount of $1,850 each month commencing May 1, 2018 for an indefinite period until reviewed upon Thomas’ retirement or other material change in circumstances. [^2]

[10] Somewhat presciently, in para. 285 of his decision, Raikes J. held:

There were many calculations necessary in this decision. I have tried to ensure no arithmetic errors. If counsel for Willow or Thomas find any such errors, they may notify me and the other party. I will determine at that time the appropriate method of proceeding.

[11] Further to the invitation of Raikes J., the parties did re-attend before him on March 12, 2018, in order to address two arithmetic mistakes that had been discovered in the calculations set out in the court’s reasons for judgment. One correction proceeded on consent; Raikes J. heard argument on the other point. Very shortly after the hearing, Raikes J. released a further written correction endorsement on March 14, 2018, in which he made two corrections to his trial decision.

[12] Justice Raikes dealt with the first correction as follows:

The first is straightforward and Mr. Kelly agrees the figure is wrong. At para. 50 of the decision, I calculated the arrears for child support for 2013 as $16,800. It should have been $15,800. That difference is carried through the decision at various points ultimately understating by $1,000 the amount payable by Mr. Kelly for arrears of spousal support net of arrears of child support at paras. 282 and 286, item 6. The correct figure to be substituted in each of paras. 282 and 286, item 6 is $10,866. My decision is amended accordingly. [^3] [Emphasis added.]

[13] The second point dealt with the equalization calculations. Counsel for the applicant submitted that the calculation of Mr. Kelly’s net family property in the reasons for judgment was incorrect by $41,000. The question was argued before Raikes J., who ultimately concluded that there was merit in the applicant’s point, as follows:

As a result, Mr. Kelly’s net family property on the date of separation is understated by $41,000. The difference between their respective net family properties is $41,000 too low (see para. 200). The amount payable by Mr. Kelly to Mrs. Kelly for equalization is understated by $20,500. It should be $355,038.78.

Therefore, the amounts payable for equalization in paras. 201 and 284, item 3 are hereby changed to $355,038.78 less any monies already paid toward equalization. [^4]

[14] Mr. Kelly raised an additional point at the March 12th hearing, arguing that there was an error in the calculation of tax payable on his defined contribution plan, at paras. 138-139 of the reasons for judgment. Ultimately, Raikes J. dismissed the point, ruling that the objection simply amounted to an attempt to re-argue a point that had been advanced at trial, and concluding that his reasons for judgment would remain unchanged on the point. Interestingly, in the course of dismissing the respondent’s objection, Raikes J. made the following observation:

I made clear at the outset of the March 12 hearing that I would not entertain re-argument of issues decided; the purpose of the re-attendance was to address any arithmetic errors only. [^5]

[15] The correction endorsement of March 14, 2018, also confirmed that the court intended to have prejudgment interest accrue on the amounts awarded under the trial decision, and the prejudgment interest rate was set at three per cent per annum. [^6]

[16] I note that as at the time of the attendance before Raikes J. on March 12, 2018, and the release of his correction endorsement on March 14, 2018, the formal order arising out of his reasons for judgment at trial had not yet been issued and entered.

[17] It is common ground as between the parties that there are two further errors that need to be made to the court’s correction endorsement of March 14, 2018.

[18] First, in para. 16 of his correction endorsement, Raikes J. awarded prejudgment interest at the rate of three per cent per annum. It is common ground before me that the prejudgment interest should have been 1.3 per cent per annum. [^7]

[19] Second, as quoted above, in paras. 9-10 of his correction endorsement, Raikes J. ordered that paras. 201 and 284 of his trial judgment should be amended to provide that the amount payable by Mr. Kelly to the applicant for equalization should be $355,038.78. It is common ground before me that the amount in question should be $354,038.78, and not $355,038.78 as set out in the correction endorsement. [^8]

[20] For reasons set out in his costs endorsement released May 14, 2018, Raikes J. fixed costs payable by Mr. Kelly to the applicant in the total amount of $81,920.43. [^9]

[21] Further to the court’s reasons for judgment at trial released December 19, 2017, the formal order of the court made December 19, 2017, was signed by Raikes J. on May 11, 2018, and subsequently issued and entered.

[22] Similarly, further to the court’s correction endorsement of March 14, 2018, the formal order of the court made March 14, 2018, was also signed by Raikes J. on May 11, 2018, and subsequently issued and entered.

[23] Finally, further to the costs endorsement of Raikes J. of May 14, 2018, the formal order of the court made May 14, 2018, was signed by Raikes J. on June 6, 2018, and subsequently issued and entered.

[24] In response to the applicant’s various notices of garnishment, moneys were paid by Mr. Kelly and other third party garnishees.

Issues

[25] The issues raised on the garnishment hearing are as follows:

a. What is the proper calculation of prejudgment interest under the trial judgment? b. What is the proper calculation of postjudgment interest on the trial judgment? c. What is the proper calculation of postjudgment interest on the costs judgment? d. What amount is currently owing?

Analysis

What is the proper calculation of prejudgment interest under the trial judgment?

[26] The applicant claims that the amount payable for prejudgment interest under the trial judgment of December 19, 2017, is $26,127.09 (calculated up to December 19, 2017). The respondent claims that the prejudgment interest amount is $27,955.48 (calculated up to May 13, 2018).

[27] As indicated above, the parties are agreed that the principal amount payable by the respondent to the applicant under the trial judgment is $354,038.78 and that the prejudgment interest rate payable under the trial judgement is 1.3 per cent per annum.

[28] The parties are also agreed that prejudgment interest begins to run on April 17, 2012, being the date that the application was issued.

[29] However, the parties disagree on when the prejudgment interest ceases to run.

[30] Specifically, the respondent takes the position that the prejudgment interest on the trial judgment ceases to run as of May 13, 2018. Mr. Kelly’s argument is that May 13, 2018, was the date of his comprehensive settlement proposal, which he delivered to counsel for the applicant in an attempt to resolve all outstanding issues. Mr. Kelly’s position is that counsel for the applicant never responded to his proposal and that he should not have to pay interest beyond the May 13, 2018, date of his offer.

[31] There is no merit in Mr. Kelly’s position.

[32] The obligation to pay prejudgment interest is not a function of Mr. Kelly’s offer to resolve all differences.

[33] Rather, the obligation to pay prejudgment interest arises by operation of law and the orders made by Raikes J. in this case.

[34] Subsection 128(1) of the Courts of Justice Act sets out the statutory entitlement to prejudgment interest and provides as follows:

A person who is entitled to an order for the payment of money is entitled to claim and have included in the order an award of interest thereon at the prejudgment interest rate, calculated from the date the cause of action arose to the date of the order. [^10]

[35] Further, as I have said, in his correction endorsement of March 14, 2018, Raikes J. specifically confirmed that the court intended to have prejudgment interest accrue on the amounts awarded under the trial decision. Thus, in the formal order arising out of the correction endorsement, which formal order was signed by Raikes J. on May 11, 2018, para. 3 provides that “pre-judgment interest at 1.3% per annum shall apply on the amount of $354,038.78 from April 17, 2018.”

[36] It was open to Raikes J. to disallow prejudgment interest on any portion or all of the award under his trial judgment; he did not do so.

[37] In accordance with s. 128(1) of the Courts of Justice Act, prejudgment interest is to be calculated “to the date of the order.” The date of the order in this case is December 19, 2017, being the date when the court released its reasons for judgment. Hence, the prejudgment interest runs up to the date of the judgment. Prejudgment interest does not run up to the date of Mr. Kelly’s settlement proposal. It is prejudgment interest, not pre-settlement-proposal interest.

[38] There was some argument before me concerning the effective date of the judgment, given that the reasons for judgment were released on December 19, 2017, but were then amended by the correction endorsement of March 14, 2018, and both of the formal orders arising out of the reasons for judgment and the correction endorsement were not actually signed by Raikes J. until May 11, 2018.

[39] The effective date of the trial judgment is December 19, 2017. That is the date that the order was made. Subrule 25(18) of the Family Law Rules provides that:

An order is effective from the date on which it is made, unless it states otherwise.

[40] In that regard, subrule 25(18) of the Family Law Rules mirrors subrule 59.01 of the Rules of Civil Procedure, which provides that:

An order is effective from the date on which it is made, unless it provides otherwise. [^11]

[41] There is nothing in the reasons for judgment of Raikes J. that states or provides that his judgment is not to be effective on the date on which it was made.

[42] Consequently, it does not matter that the formal order arising out of the reasons for judgment was not signed by Raikes J. until May 11, 2018, and was not issued and entered until a later date. The judgment was effective on the date it was made – that is, on December 19, 2017 – and not the date that the formal order was signed or issued and entered.

[43] In a similar vein, the fact that certain mathematical errors in the trial judgment of December 19, 2017, were subsequently corrected by the court’s correction endorsement of March 14, 2018, which corrections, in essence, amended the judgment at trial does not change the effective date of the judgment at trial.

[44] The authority of the court to amend its trial judgment in order to correct mathematical errors in the calculations set out in the judgment may be found in, inter alia, the provisions of subrule 25(19) of the Family Law Rules, which provides that:

The court may, on motion, change an order that,

(a) was obtained by fraud; (b) contains a mistake; (c) needs to be changed to deal with a matter that was before the court but that it did not decide; (d) was made without notice; or (e) was made with notice, if an affected party was not present when the order was made because the notice was inadequate or the party was unable, for a reason satisfactory to the court, to be present. [Emphasis added.]

[45] In this regard, subrule 25(19) of the Family Law Rules provides for similar powers as are contemplated by subrule 59.06(1) of the Rules of Civil Procedure, which provides that:

An order that contains an error arising from an accidental slip or omission or requires amendment in any particular on which the court did not adjudicate may be amended on a motion in the proceeding.

[46] Subrule 59.06(1) was the subject of commentary by Perell J. in Millwright Regional Council of Ontario Pension Trust Fund (Trustees of) v. Celestica Inc. [^12], where he concluded that subrule 59.06(1) provides for, inter alia, the amendment of an order that contains a mathematical error, as follows:

Rule 59.06 (1) provides for the amendment of an order that contains an error. The rule states:

59.06 (1) An order that contains an error arising from an accidental slip or omission or requires amendments in any particular on which the court did no adjudicate may be amended on a motion in the proceeding.

Rule 59.06 (1) is designed to amend judgments containing a slip or error, errors which are clerical, mathematical or due to misadventure or oversight. The rule is designed to amend judgments containing a slip, not to set aside judgments resulting from a slip in judicial reasoning: Central Canada Travel Services v. Bank of Montreal, [1986] O.J. No. 1249 (Ont. H.C.) at para. 21; Dhaliwal v. Plantus, [2007] O.J. No. 5450 (Ont. S.C.J.) at para. 4. Rule 59.06 (1) is not designed to be a disguised means to review errors in the making of the Reasons for Decision; rather, it is designed to correct errors in memorializing the Reasons into a formal order or judgment.

Generally speaking the court’s inherent and statutory jurisdiction to amend an order or judgment is limited to: (1) cases of fraud; (2) where there has been a slip in drawing up the order; and (3) where there has been an error in the order expressing the manifest intention of the court from its reasons for decision: Paper Machinery Ltd. v. J.O. Ross Engineering Corp., [1934] S.C.R. 186 (S.C.C.); Wright, Re, [1949] O.J. No. 3 (Ont. H.C.); Millard v. North George Capital Management Ltd., [1999] O.J. No. 3957 (Ont. S.C.J. [Commercial List]). The rule is only operative in exceptional circumstances given the public interest in the principle of finality to the litigation process: Shaw Satellite G.P. v. Pieckenhagen, 2011 ONSC 5968 (Ont. S.C.J.) at para. 20.

Under rule 59.06(1), the Court has the power to amend an order where there has been an error in expressing the manifest intention of the Court: Paper Machinery Ltd. v. J.O. Ross Engineering Corp., [1934] S.C.R. 186 (S.C.C.); Millard v. North George Capital Management Ltd., [1999] O.J. No. 3957 (Ont. S.C.J. [Commercial List]); Convay v. Marsulex Inc., [2004] O.J. No. 3645 (Ont. S.C.J.).

The rule permits amendments where the order obviously or indubitably does not reflect what the court intended to do, either by error or oversight: Johnston v. Johnston, [2002] O.J. No. 1570 (Ont. Div. Ct.); Saikely v. 519579 Ontario Ltd., [2002] O.J. No. 2863 (Ont. S.C.J.); Kerr v. Danier Leather Inc. (2005), 76 O.R. (3d) 354 (Ont. S.C.J.).

In Chrysler Credit Canada Ltd. v. 734925 Ontario Ltd., [1991] O.J. No. 3619 (Ont. Gen. Div.), Master Peppiatt stated at para. 10.

10. The purpose of...[the] procedure [under Rule 59] is to ensure, so far as humanly possible, that the formal order upon which an appellate court, and other members of the same court, sheriff, accountant, etc., will act accurately sets out the intention of the court which pronounced the order as reflected in the endorsement or reasons. It is important that this should be done so that all concerned may know their rights, obligations and duties. It is far more than a mere formality.

[47] In my view, the commentary of Perell J. in Millwright is instructive in considering the informed application of subrule 25(19) of the Family Law Rules. It provides support – if any was needed – for the authority of Raikes J. to amend the trial judgment in order to correct mathematical errors so as to “express the manifest intention of the court.”

[48] It should also be noted that the commentary of Perell J. and the express provisions of subrule 59.06(1) use the language of “amending” the order that contains the mathematical error. Such an order “may be amended on a motion in the proceeding.”

[49] The notion of “amending” the original judgment is the same language that Raikes J. used in his correction endorsement where, for example, as I have quoted above, he held that the “correct figure is to be substituted” in each of the relevant paragraphs of his reasons for judgment and, “[m]y decision is amended accordingly.” [^13]

[50] When one conceptualizes the critical effect of the correction endorsement as being merely an amendment to the original trial judgment, it underscores the point that the mathematical corrections effected by the correction endorsement did not change the effective date of the original trial judgment.

[51] As such, despite the fact that the correction endorsement of March 14, 2018, made amendments to the trial judgment of December 19, 2017, the effective date of that judgment, even as corrected, remains December 19, 2017.

[52] For these reasons, I find that prejudgment interest on the amounts awarded under the trial judgment is properly calculated up to the date of the trial judgment, i.e., December 19, 2017. Prejudgment interest on the principal amount of $354,038.78 from April 17, 2012, to December 19, 2017 (2,072 days) at the prejudgment interest rate of 1.3 per cent per annum amounts to $26,127.09.

[53] Accordingly, I find that the applicant’s calculation of the prejudgment interest amount under the trial judgment of December 19, 2017, as set out in Appendix 2 of her Statement of Money Owed sworn July 4, 2018, is correct. The respondent’s dispute in this regard is dismissed.

What is the proper calculation of postjudgment interest on the trial judgment?

[54] The applicant claims that the amount payable for postjudgment interest on moneys owing under the trial judgment of December 19, 2017, is $4,103.51 (calculated up to July 4, 2018, being the date the Statement of Money Owed was sworn).

[55] Subsection 129(1) of the Courts of Justice Act sets out the statutory entitlement to postjudgment interest and provides as follows:

Money owing under an order, including costs to be assessed or costs fixed by the court, bears interest at the postjudgment interest rate, calculated from the date of the order.

[56] The applicant calculates that the total amount of money owing under the trial judgment is $380,165.87, being the sum of the principal amount of $354,038.78 (which is agreed) and the prejudgment interest amount of $26,127.09.

[57] Mr. Kelly appears to take the position that postjudgment interest should be calculated on only the principal amount of $354,038.78 – in other words, that postjudgment interest should not run on the prejudgment interest component of the judgment.

[58] There is no merit in Mr. Kelly’s position.

[59] It is well settled that, unless the court orders otherwise, postjudgment interest accrues on the prejudgment interest component of the judgment debt.

[60] In Canadian Imperial Bank of Commerce v. Graat [^14], Sharpe J. (as he then was) reviewed the authorities on point and concluded that the weight of authority plainly supported the plaintiff bank’s position that postjudgment interest is to be calculated and payable upon that portion of a judgment which awards prejudgment interest. In addition, referring to s. 129(1) of the Courts of Justice Act, Sharpe J. reasoned as follows:

I would add that, quite apart from authority, this appears to me to be the better view in principle. There seems no reason to cut down the language of s. 129 (1) to exclude pre-judgment interest from the words “money owing under an order.” I would not infer an legislative intent to exclude pre-judgment interest from the fact that the subsection makes express provision for the inclusion of costs. As costs are frequently assessed or fixed after the date of the judgment or order, there was good reason to make explicit reference to costs as being owing under the order to remove any doubt on the point. More generally, an award of prejudgment interest may be seen as an aspect of compensating or making the plaintiff whole for the loss suffered. The effect of a judgment is to crystalize the entire amount of the plaintiff’s recoverable loss as of the date of judgment and it is difficult to see why a distinction should be drawn between the components used to calculate that crystalized loss for purposes of postjudgment interest. While compound prejudgment interest is not to be awarded absent circumstances calling for the exercise of equitable discretion, the Courts of Justice Act draws a clear distinction between pre- and postjudgment interest, both in the criteria for their award and in the rate of interest payable. This legislative distinction alleviates any concern that might be thought to arise from the fact that the effect of finding postjudgment interest to be payable on prejudgment interest is to award an element of compound interest.

[61] There is nothing in the circumstances of the instant case to justify a departure from the well-established rule that postjudgment interest runs on that portion of the judgment comprised of prejudgment interest rate.

[62] As such, I find that the appropriate principal amount for the purposes of calculating postjudgment interest is $380,165.87, as claimed by the applicant.

[63] It is common ground that the applicable postjudgment interest rate is two per cent per annum. Indeed, para. 11 of the formal judgment of Raikes J. dated December 19, 2017, expressly provides that the order “bears post-judgment interest at the rate of 2% per annum effective from the date of this Order.”

[64] As I understand it, Mr. Kelly takes the position, again, that no interest should run after the date of his comprehensive proposal of May 14, 2018.

[65] Respectfully, I find no merit in this contention.

[66] With the consent of counsel for the applicant, Mr. Kelly submitted a brief to me, which was marked as Exhibit no. 1 on the garnishment hearing, containing his settlement proposal of May 13, 2018, his interest calculations, and supporting documentation.

[67] On Mr. Kelly’s invitation, I received this brief of material and reviewed his settlement proposal. I agree with the submissions of counsel for the applicant that this was not what one would characterize as a bona fide offer to settle. Mr. Kelly’s settlement position proposed that the applicant should seriously compromise her entitlements under the judgment that the court had already issued.

[68] For example, at page 2 of his settlement proposal, Mr. Kelly states: “[m]y proposal is to provide her with [spousal] support through to the end of 2018. I believe with Willow’s settlement in excess of $500,000, this is more than adequate to meet her needs.”

[69] However, the court had already ruled on the applicant’s entitlement to spousal support. Paragraph 7 of the formal order of Raikes J. of December 19, 2017, provides that:

THIS COURT FURTHER ORDERS THAT the Respondent Thomas James Kelly shall pay spousal support to the Applicant Willow Elizabeth Kelly in the amount of $1,850.00 each month commencing May 1, 2018 and on the 1st of each month thereafter for an indefinite period until reviewed upon Thomas’ retirement or other material change in circumstances.

[70] In other words, the court had already ruled that the applicant was entitled to spousal support from Mr. Kelly for “an indefinite period” – whereas Mr. Kelly was suggesting in his settlement proposal that he would pay spousal support to the end of 2018 only. Clearly, Mr. Kelly’s settlement proposal sought to have the applicant seriously compromise her entitlement under the trial judgment.

[71] In such circumstances, there is no basis to reasonably suggest that postjudgment interest should not be payable beyond May 14, 2018, on account of the fact that the applicant did not accept Mr. Kelly’s “offer” to seriously compromise her entitlement under the court’s judgment. I reject Mr. Kelly’s submission that interest should cease to accrue as of May 14, 2018.

[72] As such, I find that the applicant’s calculation of the postjudgment interest amount accrued on the trial judgment of December 19, 2017, as set out in Appendix 2 of her Statement of Money Owed sworn July 4, 2018, is correct as far as it goes. Postjudgment interest on the principal amount of $380,165.87 from December 19, 2017, to July 4, 2018 (197 days) at the postjudgment interest rate of two per cent per annum amounts to $4,103.51.

[73] However, postjudgment interest on the amounts awarded under the trial judgment would continue to accrue after July 4, 2018. I find that the per diem rate of postjudgment interest on the amounts owing under the trial judgment is $20.83 ($4,103.51 accrued over 197 days divided by 197 days).

[74] I will address the balance owing below.

[75] Accordingly, the respondent’s dispute in respect of the calculation of the postjudgment interest on the trial judgment is dismissed.

What is the proper calculation of postjudgment interest on the costs judgment?

[76] As indicated above, pursuant to his costs endorsement released May 14, 2018, Raikes J. fixed costs payable by Mr. Kelly to the applicant in the total amount of $81,920.43. [^15]

[77] Paragraph 2 of the formal order arising out of the costs endorsement, which was signed on behalf of Raikes J. on June 6, 2018, provided that the order for costs bears postjudgment interest at the rate of three per cent per annum from the date of the order.

[78] It is settled law that interest on costs runs from the date of the order for the payment of costs. [^16]

[79] Mr. Kelly takes the position that no interest should accrue on the costs award because, again, he made a settlement proposal on May 13, 2018, and he alleges that counsel for the applicant did not respond to him. The settlement proposal advanced by Mr. Kelly proposed that he should pay nothing to the applicant for costs, whereas the costs endorsement of Raikes J. ordered him to pay the applicant $81,920.43 for costs.

[80] Accordingly, for similar reasons as set out above, I find that the fact that Mr. Kelly made a “settlement” proposal pursuant to which he would pay nothing for costs despite the fact that the court has found that he should pay $81,920.43 for costs is no reason to deny the applicant her entitlement to postjudgment interest on the court’s costs award.

[81] As such, I find that the applicant’s calculation of the postjudgment interest amount accrued on the costs award of May 14, 2018, as set out in Appendix 3 of her Statement of Money Owed sworn June 20, 2018, is correct as far as it goes. Postjudgment interest on the principal amount of $81,920.43 from May 14, 2018, to June 20, 2018 (37 days) at the postjudgment interest rate of three per cent per annum amounts to $249.13.

[82] However, postjudgment interest on the amounts awarded under the costs award would continue to accrue after June 20, 2018. I find that the per diem rate of postjudgment interest on the amounts owing under the costs award is $6.73 ($249.13 accrued over 37 days divided by 37 days).

[83] I will address the balance owing below.

[84] Accordingly, the respondent’s dispute in respect of the calculation of the postjudgment interest on the costs award is dismissed.

What amount is currently owing?

[85] There were substantial moneys paid by Mr. Kelly and third party garnishee(s) as of July 27, 2018.

[86] As such, I find it instructive to reconcile the amounts owing with the amounts paid as of July 2018.

[87] In reconciling the amounts owing as of July 27, 2018, I acknowledge that as of that date the applicant had not been paid any amounts under the trial judgment or costs award. Indeed, I am advised that no moneys were actually released to the applicant’s counsel until September 4, 2018. It would seem to be unchallenged if not common ground that when Mr. Kelly was able to raise the money as of July 27, 2018, he paid the money to the Sheriff’s Office, rather than to the applicant directly (or her counsel in trust), because he understood that payment to the Sheriff’s Office had been required of and made by the third party garnishees, and he believed he was obliged to follow the same procedure. I accept his explanation that he did not know that he could have paid the applicant (or her counsel in trust) directly.

[88] In that vein, I also note that in his settlement proposal of May 13, 2018, Mr. Kelly specifically asked counsel for the applicant, on page 4 of his proposal, as to the appropriate payment arrangements, as follows: “[p]lease advise on the details of how the payments should be made.”

[89] It is common ground that counsel for the applicant did not respond to this particular inquiry in Mr. Kelly’s correspondence of May 13, 2018.

[90] Counsel explains that, given the content of Mr. Kelly’s May 13th correspondence, it was clear that Mr. Kelly was contemplating, if not threatening, an appeal of the orders of Raikes J. In that regard, I note the opening language of Mr. Kelly’s correspondence to counsel in para. 1 thereof: “[a]s we discussed, I felt that the judgement was very unfair and heavily biased toward Willow.”

[91] In the same vein, I note the subsequent statements of Mr. Kelly on page 1 of his settlement proposal, under the heading of “Notice of Appeal” as follows:

Notice of Appeal

I ask that your client give my proposal to close out all matters serious consideration. I have met with a lawyer and he advises that I have a strong argument for an appeal base on 1) gender bias in favour of Willow and 2) untruthful statements made by Willow in court regarding her relationship with Mr. John Lorne Harris. Both led to favourable decisions for Willow. Points of contention include the following: …

[92] In the circumstances, I can appreciate the feeling of counsel for the applicant that Mr. Kelly’s “settlement proposal” was not so much an offer of settlement as it was a threat of appeal. In the circumstances, counsel made the tactical decision not to respond to Mr. Kelly’s correspondence until he believed the time period for an appeal had expired.

[93] While it is fair to say that Mr. Kelly’s settlement proposal clearly threatened an appeal, and while I may understand counsel’s reasoning for not having responded to Mr. Kelly’s correspondence, I do not wish to be taken as having commented, one way or the other, on the wisdom or appropriateness of counsel’s decision not to respond to Mr. Kelly on that basis.

[94] That said, the fact remains that in his correspondence of May 13, 2018, Mr. Kelly clearly and expressly asked counsel to please “advise on the details of how the payments should be made.”

[95] It may be that counsel had his own reasons for not responding to the settlement proposal on its merits, but, in my view, there was nothing that would have prevented counsel from responding to Mr. Kelly’s discrete inquiry as to the details of how his payments should be made. In my view, if that specific inquiry had been answered, it is likely that Mr. Kelly would have made his payments directly to the applicant (or her counsel in trust).

[96] In the circumstances, I do not believe it is fair to hold Mr. Kelly responsible for the payment of postjudgment interest because the Sheriff’s Office did not release to the applicant until September 4, 2018, certain amounts that Mr. Kelly did in fact pay on July 27, 2018.

[97] As such, I would give Mr. Kelly “full credit” for the amounts that were in fact paid as of July 27, 2018, despite the fact that, apparently, the applicant did not receive those amounts from the Sheriff’s Office until on or about September 4, 2018.

[98] In accordance with the findings set out above, the total amount owing under the trial judgment and the costs award as of July 27, 2018, was $467,167.04, calculated as follows:

a. Amount owing under the trial judgment as at July 4, 2018: $384,269.38 b. Amount owing under the costs award as at June 20, 2018: $ 82,169.56 c. Per diem postjudgment interest on trial judgment from July 4, 2018, to July 27, 2018, at $20.38 per day for 23 days: $ 479.09 d. Per diem postjudgment interest on costs award from June 20, 2018, to July 27, 2018, at $6.73 per day for 37 days: $ 249.01 e. Total: $467,167.04

[99] From the information provided to the court by Mr. Kelly, it appears that as of July 27, 2018, the total amount of $462,335.43 had been received from all payor sources.

[100] Accordingly, as of July 27, 2018, the balance owing by Mr. Kelly to the applicant was $4,831.61.

[101] More particularly, I find that, applying the total moneys received from all sources as of July 27, 2018, to, firstly, the amounts owing as of that same date under the trial judgment, and then the amount owing for postjudgment interest on the trial judgment, and finally the amount owing under the costs award, the balance owing as of July 27, 2018, was $4,582.60 on account of the principal of the costs award and $249.01 on account of the postjudgment interest outstanding on the costs award, for a total amount owing of $4,831.61 under the costs awards as of July 27, 2018.

[102] I am advised by Mr. Kelly that a further payment was received by the court on August 8, 2018, in the amount of $1,114.26. To the benefit of Mr. Kelly, I would apply the entire amount of that payment to the outstanding principal of the costs award, such that as of August 8, 2018, the amount outstanding on the principal of the costs award was $3,467.84.

[103] Postjudgment interest on the costs award as of August 8, 2018, amounts to $4.52, being the interest on the outstanding principal amount of $4,582.60 from July 27, 2018, to August 8, 2018 (12 days) at the rate of three per cent per annum ($4,582.60 x 12/365 x 0.03 = $4.52).

[104] Accordingly, after the $1,146.76 payment on August 8, 2018, the balance owing was the $4,831.61 owing as of July 31, 2018, less the payment on account of principal of $1,114.76 as of August 8, 2018, plus the postjudgment interest of $4.52 from July 27, 2018, to August 8, 2018, for a total balance owing under the costs award of $3,721.37 as of August 8, 2018.

[105] I am advised by Mr. Kelly that a further payment was received by the court on August 15, 2018, in the amount of $1,020.30. Again, to the benefit of Mr. Kelly, I would apply the entire amount of that payment to the outstanding principal of the costs award, such that as of August 15, 2018, the amount outstanding on the principal of the costs award was $2,447.54.

[106] Postjudgment interest on the costs award as of August 15, 2018, amounts to $2.00, being the interest on the outstanding principal amount of $3,467.84 from August 8, 2018, to August 15, 2018 (7 days) at the rate of three per cent per annum ($3,467.84 x 7/365 x 0.03 = $2.00).

[107] Accordingly, after the $1,020.30 payment on August 15, 2018, the balance owing was the $3,721.37 owing as of August 8, 2018, less the payment on account of principal of $1,020.30 as of August 15, 2018, plus the postjudgment interest of $2.00 from August 8, 2018, to August 15, 2018, for a total balance owing under the costs award of $2,703.07 as of August 15, 2018.

[108] Assuming there have been no further payments since August 15, 2018, then the current balance owing under the costs award would be $2,713.53, being the balance owing as of August 15, 2018, of $2,703.07, plus the postjudgment interest of $10.46 from August 15, 2018, to October 6, 2018, for a total balance owing under the costs award of $2,713.53 as of October 6, 2018.

[109] In order to facilitate the timely resolution of this matter, and in order to incentivize the respondent, I would order that, assuming there have been no further payments since August 15, 2018, if the respondent pays the applicant the total sum of $2,713.53 on or before October 31, 2018, then the respondent shall be deemed to have satisfied all amounts owing under the trial judgment of December 19, 2017, and the costs endorsement of May 14, 2018, with no further obligation owing.

[110] However, if the respondent fails to pay the amount of $2,713.53 on or before October 31, 2018, then the respondent shall be liable for payment of the total amount owing under the costs award of May 14, 2018, being the balance of $2,447.54 owing as of August 15, 2018, plus postjudgment interest calculated on $2,447.54 from August 15, 2018, to the date of payment at the postjudgment interest rate of two per cent per annum.

Conclusion

[111] Accordingly, having considered the parties’ submissions, I would dismiss the respondent’s dispute pursuant to subrule 29(19)(1) of the Family Law Rules.

[112] I would make an order pursuant to subrule 29(19)(9) of the Family Law Rules in accordance with paras. 109-110 of my order above.

[113] As the applicant was almost entirely successful on this garnishment hearing, I would award her costs, as requested, in the total amount of $800.00, all inclusive, payable by the respondent to the applicant within 30 days.

Original signed by Justice J. Paul R. Howard

J. Paul R. Howard Justice

Date: October 5, 2018

[^1]: Family Law Rules, O. Reg. 114/99. [^2]: Kelly v. Kelly, 2017 ONSC 7609 (S.C.J.), at para. 284. [^3]: Kelly v. Kelly, 2018 ONSC 1727 (S.C.J.), at para. 3. [^4]: Ibid., at paras. 9-10. [^5]: Ibid., at para. 14. [^6]: Ibid., at para. 16. [^7]: Thus, Appendix 2 of the applicant’s Statement of Money Owed sworn July 4, 2018, uses the interest rate of 1.3 per cent per annum to calculate prejudgment interest. [^8]: Thus, para. 13(C) of the applicant’s Statement of Money Owed sworn July 4, 2018, provides that the lump-sum debt owing is $354,038.78 in calculating the total amount enforceable. [^9]: Kelly v. Kelly, 2018 ONSC 3017 (S.C.J.), at para. 10. [^10]: Courts of Justice Act, R.S.O. 1990, c. C.43, s. 128(1). [^11]: Rules of Civil Procedure, R.R.O. 1990, Reg. 194, r. 59.01. [^12]: Millwright Regional Council of Ontario Pension Trust Fund (Trustees of) v. Celestica Inc., 2013 ONSC 1502 (S.C.J.), at paras. 29-34. [^13]: Kelly v. Kelly, 2018 ONSC 1727 (S.C.J.), at para. 3. [^14]: Canadian Imperial Bank of Commerce v. Graat, [1997] O.J. No. 3725, 14 C.P.C. (4th) 131 (Gen. Div.), at para. 13, affirmed [1998] O.J. No. 4420, 27 C.P.C. (4th) 184 (C.A.). See also 469804 Ontario Ltd. v. 723146 Ontario Ltd. (2002), 59 O.R. (3d) 442, 27 C.P.C. (5th) 148 (S.C.J.), at para. 12; Weaver v. Casey’s Welding Service Ltd., [2007] O.J. No. 880, 57 C.C.E.L. (3d) 47 (S.C.J.), at para. 5; and D. (P.) v. Allen, [2004] O.J. No. 3042 (S.C.J.), at para. 334. [^15]: Kelly v. Kelly, 2018 ONSC 3017 (S.C.J.), at para. 10. [^16]: United States v. Yemec (2007), 85 O.R. (3d) 751, [2007] O.J. No. 2066 (Div. Ct.), at paras. 74-75, cited with approval in Oak Incentives Group Inc. v. Toronto Dominion Bank, 2012 ONCA 726, at para. 5.