Court File and Parties

COURT FILE NO.: FS-16-28400-00 DATE: 2018-11-01 ONTARIO SUPERIOR COURT OF JUSTICE

B E T W E E N:

ERNEST WILLIAM BELOW Andrew Feldstein, for the Applicant Applicant

• and -

STACY SHEENE Reesa Heft, for the Respondent Respondent

Price J.

Costs Endorsement

OVERVIEW

[1] Ernest Below, a Canadian citizen residing in Ontario, and Stacy Sheene, a U.S. citizen residing in Florida, have been unable to agree on who is responsible for the costs they incurred in a motion by Mr. Below to keep Ms. Sheene from removing their two young children from Ontario to Florida and a cross-motion by Ms. Sheene for an Order requiring Mr. Below to return their children to her and permitting her to return them to Florida. These reasons will address that issue.

BACKGROUND FACTS

[2] Mr. Below and Ms. Sheene are both 46 years old. Mr. Below, a self-employed landscaper, and Ms. Sheene, a flight attendant residing in Saudi Arabia, met in St. Maarten in 2005. They were in a long-distance relationship for 3 ½ years, until 2009. In May 2007, Mr. Below persuaded Ms. Sheene to come to Canada, where their first child, Carter, was born in 2008.

[3] Ms. Sheene alleges that when Carter was 5 months old, Mr. Below became violent toward her and she fled with Carter to a Domestic Abuse Centre. After remaining there overnight, they boarded an airplane to Florida, where Ms. Sheene’s parents lived. Mr. Below travelled to Florida to spend the winter, bought a house there, and the parties resumed co-habitation. Their second child, Chloe, was born in Florida in September 2009.

[4] In December 2009, the parties separated but continued living under the same roof for two more years, until December 2011, when Ms. Sheene went to live with her parents. In February 2012, Mr. Below petitioned a Florida Court to determine the paternity of the children and Ms. Sheene counter-petitioned for relocation of the children.

[5] Through mediation, the parties came to an agreement in June 2012. The Agreement was incorporated into a Final Judgment of the 20th Circuit Court in Florida, which held that it had jurisdiction and approved the Agreement as being in the best interests of the children. The Agreement, while not explicitly granting custody of the children to Ms. Sheene, provided that they would reside primarily with her, with specified access to Mr. Below.

[6] Ms. Sheene obtained a B.A. at Florida Gulf University and a Teaching Certificate, and Ms. Sheene became employed as a substitute teacher from 2014 to 2016. Mr. Below then persuaded Ms. Sheene to move to Ontario, with a promise that he would sponsor her immigration to Canada and give her financial assistance until she was economically self-sufficient here. Before leaving Florida, Ms. Sheene learned that she had a lump in her breast, and her Florida doctors recommended that she undergo surgery. Following her return to Florida and surgery in May and September 2016, Mr. Below informed her that he had a girlfriend who had moved into his house and that he was no longer going to support Ms. Sheene. Ms. Sheene had nowhere to reside in Ontario and no legal status or means of support here.

[7] On November 20, 2016, Ms. Sheene informed Mr. Below by e-mail that she intended to return to Ontario to pick up the children and return to Florida with them. When she returned to Ontario on November 25, she learned that earlier that day, Mr. Below had obtained an order, without notice to her, that prevented her from removing the children from Canada. The Court adjourned Mr. Below’s motion to December 23, 2016, to enable Ms. Sheene to complete her medical treatment for post-surgical complications and retain counsel in Ontario and file responding material. In the interval, Ms. Sheene made a cross-motion for an Order requiring Mr. Below to return the children to her care, and permitting her to return the children to Florida.

[8] At the hearing on December 23, 2016, the Court made an Order for Christmas access. It reserved the balance of the issues until January 5, 2017, when it released its decision and reasons in the motion and cross-motion. The Court held that while the children had a real and substantial connection with Ontario, they had a greater connection with Florida, where they had lived for most of their lives before coming to Ontario in April 2016. On a balance of convenience, it held that it was appropriate for jurisdiction to be exercised in Florida, where a court had made the Order in 2012 giving primary residence of the children to Ms. Sheene with access to be exercised by Mr. Below.

[9] The Court held that Mr. Below was better able, financially and otherwise, to assert his claims in Florida than Ms. Sheene was in Ontario, where she had no legal status, ability to obtain employment, or means of support. For those reasons, the Court ordered that it had no jurisdiction in relation to the children. It terminated the Court’s earlier temporary Order prohibiting Ms. Sheene from removing the children from Ontario, and ordered Mr. Below to return the children and their passports to Ms. Sheene, and pay the expense of flying her and the children back to Florida.

[10] The parties were unable to agree on costs. They made written submissions on that issue, which the Court has now considered. These reasons will address the costs issue.

PARTIES’ POSITIONS

Ms. Sheene’s Position

[11] Ms. Sheene seeks her costs in the amount of $22,398.86, consisting of $17,652.86 which she paid to Heft Law, who represented her at the hearing of the motions, and $4,746.00 which she paid to Ms. Jacqueline Dickson, her previous lawyer. She has attached a Bill of Costs and an invoice from Ms. Dickson dated November 30, 2016.

[12] Ms. Sheene relies on her success in the motion, and her presumptive entitlement to costs pursuant to Rule 24(1) of the Family Law Rules. She seeks her costs on a full recovery basis on the ground that Mr. Below, “essentially absconded with the children upon receipt of notice from [Ms. Sheene] that her intention was to return to Florida with the children,” and should be sanctioned by the Court for his Bad Faith. She also relies on an Offer to Settle which she served on December 21, 2016, two days before the hearing.

Mr. Below’s Position

[13] Mr. Below submits that Ms. Sheene was only partly successful in the motion and cross-motion, that he was not acting in Bad Faith but, rather, in the best interests of the children, that the outcome was not as favourable to Ms. Sheene as her non-severable Offer to Settle, and that each party should bear his or her own costs. He further asserts that at the time he delivered his submissions, he did not have the means to pay $22,298.86 (sic) and asks, in the alternative, that Ms. Sheene be awarded her costs on a partial indemnity scale, in the amount of $8,000.00, inclusive of HST and disbursements, and that he be given 8 months to pay.

ANALYSIS AND EVIDENCE

1. General Principles

a) Principles to be balanced

[14] In awarding costs, I must balance two conflicting principles, namely, to indemnify the successful litigant for his cost of enforcing his right to access, and to avoid making potential litigants feel unduly hesitant to defend their rights by requiring them, as unsuccessful litigants, to bear all the costs of the successful party as well as their own. [1] The ultimate objective in balancing these principles is to ensure that the justice system works fairly and efficiently. [2]

b) Discretion to be exercised

[15] The entitlement to costs and the appropriate amount to be paid is “within the court’s discretion”. [3] The Family Law Rules direct the court as to how its discretion as to costs is to be exercised. Rule 24(1) presumptively entitles a successful party to costs. Although it circumscribes the broad discretion on costs which s. 131(1) of the Courts of Justice Act confers on the court, it does not completely remove a judge’s discretion. [4] Rules 24(4) and 24(5), for example, state that a successful party may be deprived of costs if he or she has behaved unreasonably.

c) Objectives to be Served

[16] Indemnification of the successful party is the paramount objective, but not the only one, to be served by a costs order. Other objectives that the court has recognized include encouraging settlement, discouraging frivolous proceedings and unnecessary steps in litigation, [5] and preserving access to justice. [6]

[17] Ms. Sheene was successful in establishing that it was the Florida Court that properly had jurisdiction over the children, and that she should be permitted to return the children to that State for any determinations as to custody of, or access to them. She is therefore presumptively entitled to her costs of the motion.

[18] Rule 24 of the Family Law Rules provides, in part:

24. (1) There is a presumption that a successful party is entitled to the costs of a motion, enforcement, case or appeal.

(4) Despite subrule (1), a successful party who has behaved unreasonably during a case may be deprived of all or part of the party’s own costs or ordered to pay all or part of the unsuccessful party’s costs.

(5) In deciding whether a party has behaved reasonably or unreasonably, the court shall examine,

(a) the party’s behaviour in relation to the issues from the time they arose, including whether the party made an offer to settle.

(8) If a party has acted in bad faith, the court shall decide costs on a full recovery basis and shall order the party to pay them immediately. [Emphasis added]

d) Factors to be Considered

[19] Rule 24(11) lists the factors that the court should consider in quantifying costs:

24. (11) A person setting the amount of costs shall consider,

(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, 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;

(e) expenses properly paid or payable; and

(f) any other relevant matter.

1. Importance, Complexity and Difficulty

[20] The issues in the motions were important to both parties, as they pertained to their relationships with their children. Mr. Below sought to prevent Ms. Sheene from returning to Florida with the children. Ms. Sheene notes that, “the determination of the issue would determine if [she] would be able to continue to have access to the children, notwithstanding she had been their primary caregiver since birth and if this Honourable Court ordered that the children were to remain in Canada she would be unable to remain tin this country with the children.”

[21] The issue of the children’s “habitual residence” was a complex one in the circumstances of this case, having regard to the fact that:

(a) The Florida Court had last exercised jurisdiction five years earlier and, in the meantime, Ms. Sheene had brought the children to Ontario voluntarily and, apparently, with the intention of settling here permanently.

(b) The Children’s Law Reform Act (“CLRA”) in s. 42(1), provides that a court may supersede an extra-provincial order in respect of custody of or access to a child where it is satisfied that there has been a material change in circumstances that affects or is likely to affect the best interests of the child, even if the child is not habitually resident in Ontario, if the child is physically present in Ontario at the commencement of the application and the child no longer has a real and substantial connection with the place where the extra-provincial order was made, has a real and substantial connection with Ontario, and there is substantial evidence concerning the best interests of the child available in Ontario, provided that, “on a balance of convenience, it is appropriate for jurisdiction to be exercised in Ontario”;

(c) Section 42(2) of the CLRA allows the court to decline its jurisdiction where it is of the opinion that it is more appropriate for jurisdiction to be exercised outside Ontario, although s. 69 provides that the Part of the Act in which those sections appear does not deprive the Court of its parens patriae jurisdiction.

[22] For all of these reasons, the motions required a detailed consideration of the sequence of events which brought Ms. Sheene to Ontario with the children, their circumstances here and in Florida, and where the issue of their best interests could most conveniently be determined.

2. Reasonableness of Each Party’s Behaviour

[23] Rule 24(4) of the Family Law Rules explicitly authorizes the use of costs orders to express the court’s disapproval of a litigant’s unreasonable conduct. It provides:

24.(4) Despite sub-rule (1) [which provides that a successful party is presumed to be entitled to the costs of a motion], a successful party who has behaved unreasonably during a case may be deprived of all or part of the party’s own costs or ordered to pay all or part of the unsuccessful party’s costs. [Emphasis added]

[24] Rule 24(4) explicitly recognizes the principle that costs may be used to express the court’s disapproval of a litigant’s unreasonable conduct. As noted above, the rule provides that a successful party who has behaved unreasonably during a case may be ordered to pay all or part of the unsuccessful party’s costs.

[25] Not every instance of unreasonable conduct attracts an order that costs be paid on a higher than partial indemnity scale. Substantial indemnity costs, like their predecessor, solicitor and client costs, are exceptional. Mark M. Orkin, in The Law of Costs, [7] cites the Supreme Court of Canada in Young v. Young, (1993). In that case, McLaughlin J., as she then was, stated:

Solicitor-client costs are generally awarded only where there has been reprehensible, scandalous or outrageous conduct on the part of one of the parties. Accordingly, the fact that an application has little merit is no basis for awarding solicitor-client costs.

[26] It is generally not appropriate to award a successful litigant more than 85 per cent of his/her bill, unless the unsuccessful litigant has acted unreasonably or in bad faith, to the extent that censure is appropriate. [8]

[27] Mr. Sheene did not conduct herself so unreasonably as to be deprived of the costs to which she is presumptively entitled. Mr. Below asserts that her behaviour was unreasonable in that:

(a) She gave him no choice but to commence his Application and bring his ex parte motion for non-removal of the children, “given her own short notice of removing the children after confirming her intention to [Mr. Below] of staying in Canada with the children and the messages he discovered of her plans to leave even earlier than communicated to him”;

(b) Her change of counsel, which he says caused further delays and required the parties to file additional material to update the Court prior to the hearing of the motions;

(c) Her unfounded allegations of abuse and drug use against Mr. Below, which increased the costs of both parties and involved the Peel Children’s Aid Society with the children.

[28] The issue here is not whether Mr. Below was justified, by the short notice Ms. Sheene gave him of her intentions, but whether it was unreasonable for Ms. Sheene to act as she did. Given that Mr. Below had withdrawn the financial support which was the inducement for her coming to Canada in the first place, and the fact that it was serious surgery that required her to leave the children temporarily in Mr. Below’s care, it was not unreasonable for Ms. Sheene to expect that Mr. Below would not seek to prevent her from returning the children to Florida after her surgery. He had limited her options to do otherwise.

[29] Ms. Sheene cannot be faulted for changing counsel, having regard to the fact that she was not habitually resident in Ontario herself, and had limited financial resources owing to Mr. Below’s withdrawal of his support of her. It would have been a challenge for anyone, in these circumstances, and in the exigent circumstances created by the Order Mr. Below had obtained without notice to her, to seek out and retain the most suitable counsel immediately.

[30] I am not persuaded that Ms. Sheene made “unfounded allegations of abuse and drug use” against Mr. Below. She stated, in her affidavit, that upon her arrival in Canada, Mr. Below had become controlling and abusive, which she attributed to his use of drugs. She stated that on several occasions, he physically assaulted her, including an incident when she was pregnant with Carter, when he chased her down basement stairs, pushed her to the ground, grabbed her rubber slipper, and struck her in the face with it, then grabbed her hair and dragged her into another room.

[31] Ms. Sheene stated, in her affidavit, that when she was hospitalized in Toronto for Carter’s birth in 2008, the Children’s Aid Society attended as a result of a report from her obstetrician/gynecologist, whom she had asked to refer her to a counsellor who could provide treatment to Mr. Below for his drug addiction. She stated that the C.A.S. came to her hospital room to inquire whether it was safe for her to return home to Mr. Below with Carter, owing to his drug issues.

[32] Ms. Sheene further stated that while living in Mr. Below’s home following her return in April 2016, she discovered that Mr. Below was buying drugs and trafficking in cocaine. She alleged that he was constantly smoking marijuana, and that he had rolled joints and smoked them in front of the children. She reported those activities to the Children’s Aid Society, who undertook an investigation, not completed at the time of the hearing on December 23rd.

[33] While Mr. Below stated that he had not abused drubs, he acknowledged that he had been found guilty of possession of marijuana, for which he had been pardoned. Ms. Sheene stated, in her reply, that in 2015, Mr. Below attended the Amen Clinic in Virginia for cocaine addiction and had been in rehabilitation multiple times, both as an in-patient and as an out-patient.

[34] Ultimately, this Court found that the parties’ allegations about each other’s shortcomings as a parent were not supported by evidence from disinterested third parties. They were also inconsistent with both parties’ willingness in the past, and especially at the time of their agreement in 2012, to entrust the children to the other’s unsupervised care, even for short periods of time. Mr. Below stated that the children had been thriving in Ontario since April 2016, and Ms. Sheene did not dispute that fact. Nevertheless, the Court did not find that Ms. Sheene’s evidence regarding Mr. Below’s drug use was reckless or unfounded, and the fact that she raised those concerns in her evidence, in a case where the Court was required to consider whether the children would face serious harm if they remained in, or left, Ontario, did not amount to unreasonable conduct.

[35] In Nairn v. Lukowski, (2002), and in Piskor v. Piskor, (2004), Blishen J. adopted the definitions of bad faith that the court formulated in Erickson v. Erickson, [9] (2000), and Hunt v. Hunt, (2001). [10] In those cases, it was held that bad faith could consist of conduct intended to deceive or mislead, [11] or of an intentional breach of an agreement or court order in order to achieve an ulterior motive. Those formulations of bad faith are consistent with the definition set out in Black’s Law Dictionary, 6th ed. (St. Paul, Minn./West Publishing Co., 1990):

Generally implying or involving actual or constructive fraud, or a design to mislead or deceive another, or a neglect or refusal to fulfill some duty or some contractual obligation not prompted by an honest mistake as to one’s rights or duties but by some interested or sinister motive. Bad faith is not simply bad judgment or negligence but rather it implies the conscious doing of a wrong because of dishonest purpose or moral obliquity; it is different from the negative idea of negligence in that it contemplates a state of mind affirmatively operating with furtive design or ill will. [12] [Emphasis added]

[36] Justice Perkins gave a more extensive explanation of bad faith in S.(C.) v. S.(C.) in 2007:

…The essence of bad faith is the representation that one’s actions are directed toward a particular goal while one’s secret, actual goal is something else, something that is harmful to other persons affected or at least something they will not willingly have supported or tolerated if they had known. However, not all bad faith involves an intent to deceive. It is rare, but not unknown in family cases, for bad faith to be overt – an action carried out with an intent to inflict harm on another person or a person affected by the case without an attempt to conceal the intent.

In order to come within the meaning of bad faith in Rule 24(8), behaviour must be shown to be carried out with intent to inflict financial or emotional harm on the other party or persons affected by the behaviour, to conceal information relevant to the issues or to deceive the other party or the court. A misguided but genuine intent to achieve the ostensible goal of the activity, without proof of intent to inflict harm, to conceal relevant information or to deceive, saves the activity from being found to be in bad faith. The requisite intent to harm, conceal or deceive does not have to be the person’s sole or primary intent, but rather only a significant part of the person’s intent. At some point a party could be found to be acting in bad faith when their litigation conduct has run the costs up so high that they must be taken to know their behaviour is causing the other party major financial harm without justification. [13] [Emphasis added]

[37] Ms. Sheene’s conduct did not meet that test.

[38] The Family Law Rules do not explicitly provide for costs on either a partial or substantial indemnity scale. Rule 18(14), dealing with the costs consequences of a failure to accept an Offer to Settle, instead differentiates between “costs” and “full recovery of costs”. Rule 24(8) also refers to “costs on a full recovery basis,” where a party has acted in bad faith. In a family law case, the court need not find “special circumstances” before ordering costs on a full recovery basis. [14] This leaves a range of costs from nominal to just short of full recovery.

[39] In Sims-Howarth v. Bilcliffe, (2000), Aston J. held that the two traditional scales of costs are no longer an appropriate way to quantify costs under the Family Law Rules. [15] He stated that, having determined that one party is liable to pay costs, the court must fix the amount at some figure between a nominal sum and full recovery, having regard to the factors set out in Rule 24, without any assumptions about categories of costs. This characterization of costs under the Family Law Rules was approved by the Ontario Court of Appeal in C.A.M. v D.M. [16]

[40] More recently, in Berta v. Berta, (2015), the Court of Appeal stated:

In Biant v. Sagoo (2001), 20 R.F.L. (5th) 284 (Ont. S.C.), the court considered the costs award scheme under the rules and commented, at para. 20:

[T]he preferable approach in family law cases is to 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. There remains, I believe a discretion under Rule 24(1) to award the amount of costs that appears just in all the circumstances, while giving effect to the rules’ preeminent presumption, and subject always to the rules that require full recovery or that require or suggest a reduction or an apportionment.

This court has repeatedly endorsed the Biant court’s approach to the determination of costs in family law disputes: see for example, Ruffudeen-Coutts v. Coutts, 2012 ONCA 263, 15 R.F.L. (7th) 35, at para. 4; Sordi v Sordi, 2011 ONCA 665, 134 R.F.L. (7th) 197, at para. 21; M. (A.C.) v. M. (D.) (2003), 67 O.R. (3d) 181 (C.A.), at para. 40. [17]

[36] Costs must always be proportional to what is at stake in the case, and to the unsuccessful party’s reasonable expectation as to what costs he may face if he is unsuccessful, but unreasonable behavior will, in appropriate circumstances, result in a higher award of costs. In Perri v. Thind et al., (2010), Henderson J. granted leave to appeal to the Divisional Court from a costs award that was a marked departure from the normal or routine costs made in motions court. [18] In doing so, he stated that costs orders are not designed mainly to be a punishment. In that case, however, the motion judge had awarded costs four times greater than the successful litigant’s substantial indemnity costs. Henderson J. himself noted that costs, when awarded on a higher scale, can serve to express the court’s disapproval of unreasonable conduct. [19]

[37] Mr. Below’s conduct, in seeking to preserve the children’s residence in Ontario, also does not, in my view, meet the test of Bad Faith, or amount to such unreasonable conduct as to entitle Ms. Sheene to her costs on a full recovery basis. The evidence did not support a finding that Mr. Below was the cad that Ms. Sheene portrayed him to be. Mr. Below stated that during Ms. Sheene’s employment as a substitute teacher in Florida, she had acquired a great deal of debt and had turned to him for assistance, whereupon they had decided to rekindle their relationship. He stated that he had agreed to assist financially “for a short period of time” to enable Ms. Sheene to move to Ontario with the children, and until she was able to find employment and stabilize her life here. He stated that she asked him to help her move to Canada with the children so that they could provide a better life for them here and attempt to raise them together. In its reasons of January 2017, the Court stated:

[48] I find that there was no meeting of the minds between Mr. Below and Ms. Sheene in October 2016, if there ever was, as to the support he would provide to her if she came to Ontario. Ms. Sheene appears to have interpreted Mr. Below’s inducements to her as an undertaking to provide support until she became established in Ontario. Mr. Below says that they consisted of an offer to continue the child support payments which he was required to make pursuant to the Florida Order until the $16,000 fund was depleted, at which point he would terminate any financial support to her.

[38] The Court found that the children were habitually resident in Florida when the parties last had a shared understanding as to where the children would reside. When Ms. Sheene returned to Florida for her surgery, she made arrangements with the school fro Mr. Below’s parents to pick the children up and drop them off at school, and Mr. Below acknowledged in his Affidavit that his mother picked the children up on a regular basis and helped take care of them while he was at work. He acknowledge that he relied on his parents for their assistance in caring for the children and continued to do so.

[39] It was not unreasonable for Mr. Below to oppose the children’s return to Florida. There was substantial evidence in both Ontario and Florida concerning the children’s best interests, and the children had a real and substantial connection with Ontario, although they had a greater connection with Florida. While the Court found that the children were being wrongfully retained in Ontario in the sense that Ms. Sheene had not given up their habitual residence there, and the balance of convenience favoured litigation over custody and access in the Florida Court, it did not find that Mr. Below had abducted the children or knowingly acted contrary to their best interests, or acted unlawfully in obtaining the Court Order preventing her from returning them to Florida.

[40] More importantly, Mr. Below did not conduct the litigation in Ontario in an unreasonable manner. The only instance of unreasonable conduct in the conduct of the case that Ms. Sheene pointed to was Mr. Below’s mischaracterization of Ms. Sheene’s surgery as “plastic surgery” as distinct from bilateral mastectomy. Although obviously a mischaracterization, the fact was not in any way dispositive of the issues, and I do not find that it was made with an intent to mislead the court.

[41] The parties’ Offers to Settle were not substantially more favourable to the parties making them than the outcome of the motion. Ms. Sheene’s Offer to Settle dated December 21, 2016, provided that she was to have sole custody of the children, as well as their primary residence with her. The Court did not award her custody, but rather deferred to the jurisdiction of the Florida Circuit Court, which had assumed jurisdiction, with the parties’ consent, in 2012. Similarly, Mr. Below’s Offer to Settle dated December 22, 2016, sought terms of access that this Court did not award to him in its decision. For these reasons, the Offers do not alter Ms. Sheene’s presumptive entitlement to the recovery of her costs on a partial indemnity scale.

3. Lawyers’ Rates

[42] Ms. Sheene claims an hourly rate of $400.00 for her lawyer, Reesa Heft, who was called to the Bar in 1997, and has practiced Family Law since 2002. Ms. Heft a minor amount of work (.7 hours) to her Sr. Law Clerk, Kim Pearce, for whom she claims an hourly rate of $120.00.

[43] The “Information for the Profession” bulletin, from the Costs Sub-Committee of the Rules Committee (“the Costs Bulletin”) [20], suggests maximum hourly rates (on a partial indemnity scale) of $300.00 for lawyers, such as Ms. Heft, with under 20 years’ experience, and $80.00 for law clerks. While it is arguable that these rates are normally reserved for matters of the greatest complexity, I am satisfied they are reasonable here. I therefore find that Ms. Heft was entitled to claim the maximum rate of $300.00 allowable for lawyers in the 10 to 20 year range.

[44] The Costs Bulletin, published in 2005, is now dated. It is therefore appropriate to make an adjustment to the rates suggested in the Costs Bulletin based on inflation. Smith J. took this approach in First Capital (Canholdings) Corp. v. North American Property Group. [21]

[45] Ms. Heft’s partial indemnity rate of $300.00 in 2005 was the equivalent of $356.46 in 2016, when the motions were argued, according to the Bank of Canada’s online Inflation Calculator, which I round to $360.00. A law clerk’s rate of $80.00 in 2005 was the equivalent of $95.06 in 2016, which I round to $100.00.

[46] Aitken J., in Geographic Resources, allowed the Defendants/Respondents’ costs of an appeal from a Master’s order on a partial indemnity scale in the amount their lawyer had charged. [22] She rejected the Plaintiffs/Appellants’ argument that the Respondents should be awarded less than they had been charged because the parties had agreed that costs would be paid on a partial indemnity scale. Aitken J. began by considering the Costs Bulletin. She considered adjusting the Costs Subcommittee’s hourly rates for inflation, as Smith J. did in First Capital (Canholdings) Corp. v. North American Property Group, but the unadjusted rates of the lawyers in her case were only slightly less than the actual fees they charged, so she used their unadjusted rates. [23]

[47] Aitken J. makes it clear that the starting point in arriving at an appropriate hourly rate when fixing costs is the Costs Bulletin, not the actual hourly rate the lawyer charged her client. The actual rate charged is irrelevant, except as a limiting factor, in preventing the costs awarded from exceeding the actual fees charged, in keeping with the principle of indemnification. [24] The Costs Subcommittee’s rates apply to all lawyers and all cases, so everyone of the same level of experience starts at the same place.

[48] Although Geographic Resources was a civil action, the approach that Aitken J. took in that case applies equally in the family law context. The court adjusts the hourly rate, based on the Costs Bulletin, or the resulting fees, to reflect unique features of the case, including the complexity of the proceeding, the importance of the issues, and the other factors set out in Rule 24. If an excessive amount of time was spent, or too many lawyers worked on the file, the court reduces the resulting amount of fees accordingly.

[49] As long as the resulting amount does not exceed the amount actually charged to the client, the actual fee that the client agreed to pay is irrelevant. On this basis, Ms. Heft’s hourly rate will be reduced from $400.00 to $360.00, on a partial indemnity scale, and her law clerk’s rate will be reduced from $120.00 to $100.00.

4. The lawyer’s rates: 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

[50] A reasonable amount of time was spent preparing for the motions. Ms. Heft spent a total of 24.5 hours in her preparation for the motions. Ms. Pearce spent .7 hours. Ms. Heft was required to meet with her client, arrange for an adjournment of Mr. Below’s motion, draft Ms. Sheene’s Notice of Motion and Affidavit, draft an affidavit of her Law Clerk, draft a 35.1 Motion for Custody, an Affidavit, and Financial Statement, draft a Responding Affidavit, review Mr. Below’s Brook of Authorities and prepare one for Ms. Sheene, draft Ms. Sheene’s Offer to Settle and review the one received from Mr. Below, and prepare and attend court to argue the motions. I find the time spent to have been reasonable.

[51] Ms. Heft spent a further 1.5 hours in travel to and from court, which I allow at half her hourly rate. I therefore add .75 hours (half of 1.5) to the 24.5 claimed for the preparatory work. Ms. Heft claims 10 hours in court to argue the motions ($4,000.00), less a courtesy reduction of $500.00, for a net amount of $3,500.00. The motions were first spoken to on December 23, 2016, for 3 minutes at 12:09 p.m., were next spoken to for a minute at 2:05 p.m. and then were argued from 2:37 p.m. to 4:37 p.m. While only 2 hours were spent in actual argument, I am prepared to allow a further 5 hours on the basis that most of the time waiting to be heard were likely spent in further preparation of oral argument and certainly precluded work on other files. I therefore allow 7 hours as reasonable for the court attendance. Ms. Heft claims 3 hours for drafting Costs Submissions, which consisted of an initial 4 pages, a Bill of Costs, and a further 2 ½ page reply to Mr. Below’s submissions. Having regard to the Brief that Mr. Below submitted, I find the amount claimed by Ms. Heft for her submissions to be reasonable.

[52] The total allowable time of 35.25 hours at Ms. Heft’s hourly rate of $360.00 and Ms. Pearse’s .7 hours at her hourly rate of $100.00 amount in total to $12,760.00. H.S.T. on that amount is $1,658.80.

5. Expenses properly paid or payable

[53] The disbursements claimed by Ms. Sheene were conventional ones which are not challenged, $292.00 for photocopies, $360.00 for Process Server fees, $24.00 for fax charges and $62.00 for binding fees, for a total of $738.00. H.S.T. on that amount is $95.94, for a total of $833.94. I find the disbursements to be reasonable and recoverable in the amounts claimed.

6. Other Relevant Matters

(a) Proportionality

[54] I have considered the proportionality of the costs that Mr. Schikolenko has claimed. The principle of proportionality was added to the Rules of Civil Procedure by the amendment of Rule 1.04, which I apply by analogy to the present motion as there is no equivalent provision in the Family Law Rules. Rule 1.04 directs that the Rules be “liberally construed to secure the just, most expeditious and least expensive determination of every civil proceeding on its merits.” Sub-Rule 1.1, which was added, provides:

e) Proportionality

(1.1) In applying these rules, the court shall make orders and give directions that are proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding. O. Reg. 438/08, s. 2.

[55] Ms. Heft did not “over-lawyer” the motion. The time she spent was reasonably necessary to oppose Mr. Below’s motion and to advance Ms. Sheene’s motion for custody and permission to return the children to Florida. Ms. Sheene’s allowable costs of $15,252.74 and that amount was not disproportionate to what was at stake in the motions.

(c) What is fair and reasonable

[56] I must, at this point, step back and examine the overall award with a view to determining whether it is ‘fair and reasonable’ for the kind of matter involved. In making this determination, I take into account the reasonable expectation of the parties concerning the amount of costs. [25]

[57] Mr. Below states in his Costs Submissions that he spent $46,541.30 on his former counsels’ fees alone, not including the costs of retaining an agent to assist him in preparing his costs submissions. The legal costs he was incurring should have informed his expectations of the costs he would face if unsuccessful in the motions. On that basis, there is no reason to reduce the costs of $15,252.74 being allowed for Ms. Sheene’s costs.

CONCLUSION AND ORDER

[58] Based on the foregoing, it is ordered that:

1. Mr. Below shall pay Ms. Sheene’s costs of the motions, fixed in the amount of $15,252.74, consisting of the following:

Fees: $12,760.00 H.S.T. on Fees: 1,658.80 Disbursements: 738.00 H.S.T. on Disbursements: 95.94

TOTAL: $ 15,252.74

[59] These costs shall be payable forthwith, with 3% post-judgment interest from today.

Price J. Released: November 1, 2018

Footnotes

[1] Mark Orkin, The Law of Costs (2nd edition) (2001 Canada Law Book), p. 23

[2] British Columbia (Minister of Forests) v. Okanagan Indian Band, 2003 SCC 71, [2003] 3 S.C.R. 371 at paras. 25 and 26

[3] Courts of Justice Act, R.S.O. 1990, c. C.43, s. 131

[4] M. (A.C.) v. M.(D.), , [2003] O.J. No. 3707, 67 O.R. (3d) 181 (ON C.A.)

[5] Fellowes, McNeil v. Kansa General International Insurance Co. , 37 O.R. (3d) 464 (ON S.C.), para. 10

[6] 1465778 Ontario Inc. v. 1122077 Ontario Ltd. (2006), 82 O.R. (3d) 757 (ON C.A.), per Feldman J.A., at para. 45

[7] M. M. Orkin, The Law of Costs, 2d ed., looseleaf (Aurora, Ont.: Canada Law Book, 1987), at p. 2-46 [Orkin]; Young v. Young, , [1993] 4 S.C.R. 3, at p. 154, re-stated in Perri.

[8] Osmar v. Osmar (2000), , 8 R.F.L. (5th) 387 (Ont. S.C.).

[9] Erickson v. Erickson (May 16, 2000), Doc. 00-FL-868 (Ont. S.C.J.)

[10] Hunt v. Hunt, 2001 ONSC 39078

[11] Nairn v. Lukowski, (2002), , 29 R.F.L. (5th) 117 (Ont.S.C.J.), per Blishen J., at p. 120

[12] Piskor v. Piskor, , [2004] O.J. No. 796 (Ont. S.C.J.), per Blishen J., at paras. 9 to 12

[13] S.(C.) v. S.(C.), , [2007] O.J. No. 2164 (Ont.S.C.J.), per Perkins J. at paras. 16 and 17

[14] Sordi v. Sordi, 2011 ONCA 665, 283 O.A.C. 287.

[15] Sims-Howarth v Bilcliffe, , [2000] O.J. No. 330 (S.C.J.)

[16] C.A.M. v D.M., , [2003] O.J. No. 3707 (C.A.), at para. 42.

[17] Berta v. Berta, 2015 ONCA 918, at paras. 92-93.

[18] Perri v. Thind et al. (2010), , 98 O.R. (3d) 74 (S.C.).

[19] Perri, at paras. 24-26, 32-33.

[20] “Information for the Profession” bulletin (“the Costs Bulletin”) from the Costs Sub-Committee of the Rules Committee (that the Costs Sub-Committee of the Rules Committee issued to replace the Costs Grid, which it repealed in 2005). The Costs Bulletin has advisory status only and not statutory authority, as it was not included in the Regulation that repealed the Costs Grid.

[21] First Capital (Canholdings) Corp. v. North American Property Group, 2012 ONSC 1359, 2012 ONSC 1359 (S.C.J.)

[22] Geographic Resources Integrated Data Solutions Ltd. v. Peterson, 2013 ONSC 1041

[23] Geographic Resources Integrated Data Solutions Ltd. v. Peterson, 2013 ONSC 1041

[24] The principle that costs should not exceed the amount charged was articulated by Corbett J. in Mantella v. Mantella, , (2006), 27 R.F.L. (6th) 76 (S.C.J.), subsequently approved by Aitken J., sitting as a Divisional Court judge in Geographic Resources.

[25] Referring to: Boucher v. Public Accountants Council for the Province of Ontario, , [2004] O.J. No. 2634 (C.A.) (released June 22, 2004); Moon v. Sher, [2002] O.J. No. 4651 (C.A.) (released November 16, 2004); and Coldmatic Refrigeration of Canada Ltd. v. Leveltek Processing LLC, , [2005] O.J. No. 160 (C.A.) (released January 24, 2005)