Court File and Parties
Newmarket Court File No.: FC-17-54643-00 Date: 20181115 Superior Court of Justice - Ontario
Re: Adam Ivan Hand, Applicant And: Kimberley Michelle Hand, Respondent
Before: The Honourable Madam Justice H. McGee
Counsel: J. Edney, Counsel for the Applicant K. Dosanjh, Counsel for the Respondent
Heard: In Writing
Ruling on Costs
Applicant Seeks $117,647 in Costs for Two Motions heard September 12, 2018
1Mr. Hand’s counsel seeks a full recovery of $117,647; being fees of $99,593.00, disbursements of $4,519.16 and HST of $13,534.38. He proposes this amount as costs incurred on two motions. The amount is startling enough to forgive the mother’s counsel for exceeding her three page costs submission by 119 pages.
2The first motion was before the court on April 25, 2018. Mr. Hand sought an Order preventing Ms. Hand from changing the residence of their two school aged children; and he was successful. Ms. Hand accepted his offer that the children’s residence remain in Vaughan pending a full hearing set for June 14, 2018. An Order issued accordingly. On June 14, 2018 the motion was adjourned to September 12, 2018.
3In breach of her consent Order, Ms. Hand moved the children from Vaughan to a new residence north of Barrie. Upon learning that the children were registered to another school, Mr. Hand served his second motion returnable September 5, 2018 on an urgent basis. It sought an Order dispensing with Ms. Hand’s consent to the children’s school registration in Vaughan. This second motion was ultimately joined to the first and three other motions earlier brought by the father.
4The three other motions were heard by Justice Jarvis on September 13, 2018. No costs were assessed on those motions as success was divided.
5In reasons released September 21, 2018 I did not grant the Order sought by Mr. Hand on the second motion; but I did request the assistance of the OCL, and I made temporary Orders on my own volition to stabilize the situation. I also addressed the quandary of how relief had been framed by each parent. The mother was in breach of a consent Order, and had no motion before the court to vary those terms. At the same time, the father was not asking that the children reside with him.
6Specifically, I made a temporary Order for joint custody to prevent any further unilateral decision making by Ms. Hand and to bolster the father’s access to information. I also made an Order maximizing the father’s weekend and holiday parenting time pending the hearing of further motion(s).
7Mr. Hand proposes that he was the successful party on the attendances of April 25, 2018, June 14, 2018, September 5, 2018 and September 12, 2018; and that his recovery of costs should be full, given the court’s finding that Ms. Hand acted with deceit in moving the children’s residence in breach of the first court Order. Rule 24(1) creates a presumption of costs in favour of the successful party.
Was Mr. Hand Successful?
8Consideration of success is the starting point in determining costs [1] but success alone is not determinative, particularly in parenting cases in which a child’s best interests are paramount.
9Mr. Hand was successful on his first motion, but he did not obtain the Order sought on his second motion. Instead, he obtained an Order intended to preserve his relationship with the children pending further evidence of the children’s best interests. The Order that he sought could not be granted absent a change in primary caregiver. There is no jurisdiction to coerce a parent’s residence.
The Nature of Costs Awards
10Award of costs are complex. The court must assess the recently amended Rule 24(12) [2] factors listed below, consider whether the successful party has acted unreasonably or either party has acted in bad faith pursuant to Rules 24(4) and (8) respectively, and apply Rule 18(14) should either party have obtained a result more favourable than the terms of his or her Offer to Settle; all the while calibrating the purposes of a costs award and reflecting what the court views as a reasonable and proportionate amount that should be paid by the unsuccessful party. [3]
11The purposes of a costs award bear repeating at every instance because costs are statutorily designed to change litigation behaviour. Successful litigants should be assured of some reimbursement of their costs, inappropriate or careless litigation must be sanctioned and settlement should be powerfully incentivized. [4]
12Despite Mr. Hand not obtaining the Order sought in his second motion, I do find that he was the successful litigant. At the time that he served his second motion, he knew that Ms. Hand had moved the children to Springwater, but he had not been advised (despite numerous inquiries) whether she had sold her residence in Vaughan. I noted in my reasons for the September 12, 2018 motion that it remained unclear whether Ms. Hand had sold her Vaughan residence, and that it was possible that she continued to own both homes.
13Perhaps it will ultimately be decided that the children’s best interests are met by continuing in their mother’s primary care in another community some distance from their father; but at this stage, it is self-evident that Ms. Hand’s subterfuge must be discouraged, and that Mr. Hand should have a reimbursement of his costs.
14Rule 24(12)(a) emphasizes that when setting an amount for costs, courts are to consider reasonableness and proportionality. [5] The following factors must each be evaluated relative to the importance and complexity of the issues:
i. each party’s behaviour ii. the times spent by each party iii. any written offers to settle, including offers that do not meet the requirements of Rule 18 iv. any legal fees, including the number of lawyer and their rates v. any expert witness fees, including the number of experts and their rates vi. any other expenses properly paid or payable; and
Bad Faith Full Recovery Subject to Reasonableness and Proportionality
15If 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. [6] A party’s behaviour falls within the meaning of “bad faith” when emotional or financial harm has been intentionally inflicted on the other party, or relevant information has been concealed, or one party has deceived the other. The requisite intent to harm does not have to be the party’s sole or primary intent, but rather only a significant part of the party’s intent. [7]
16In my reasons released September 21, 2018 I found that
(a) there was no question that the mother breached the Orders of April 25, 2018 and June 14, 2018; [8] (b) the mother hid her purchase of a palatial new home north of Barrie and the subsequent move of the children; [9] (c) the mother acted with deceit; [10] (d) at an early stage and every stage thereafter, the father’s counsel was diligent in trying to ascertain the details of the proposed move; [11] and (e) the mother refused to provide the address of her new home along with a number of misstatements in her Affidavit sworn on May 28, 2018. [12]
17I find no basis for Ms. Hand’s assertion that Mr. Hand acted unreasonably. Specifically, I reject her counsel’s proposition that Mr. Hand acquiesced to the move north of Barrie and then “sand-bagged” his former spouse with a complaint after the fact. That was not in the evidence before me on this motion. Moreover, the mother’s conduct was governed by court Order. If there was in fact an agreement, Ms. Hand was obliged to vary the April 25, 2018 Order before moving the children.
18I am satisfied that Rule 24(8) is the appropriate basis upon which to award costs to Mr. Hand, bearing in mind that a full recovery of costs does not oust its complex assessment. I must still consider relative success, reasonableness, proportionality and Offers to Settle as well as the purposes of a costs award and what an unsuccessful party would expect to pay in costs.
Offers to Settle
19Mr. Hand’s first Offer was accepted on April 25, 2018 and mirrored the terms sought on the motion. He is entitled to his full costs for that attendance with some alleviation for Ms. Hand’s acceptance. He made no further Offers to Settle related to the two motions ultimately heard September 12, 2018.
20By cover letter dated July 4, 2018, Ms. Hand offered to settle the first motion by the parties entering into a comprehensive Separation Agreement that included terms for child support, a release of spousal support, a release of equalization including household contents, no further payments and seven further pages of releases, acknowledgements and general terms. This was a global Offer that cannot be considered per Rule 18(14).
21I observe that Ms. Hand’s lengthy, proposed Separation Agreement included a brief, one sentence term tucked into the “Non-Removal from Jurisdiction and Travel” subheading that the children would reside in Springwater. [13] The draft Separation Agreement was only open for acceptance until July 15, 2018. In no manner does it assist in mitigating the mother’s obligation to pay costs.
$117,647 is Not a Reasonable and Proportionate Amount
22Even a full recovery of costs following on a finding of bad faith must be respectful of the after-tax, financial means of the family. In no way is $99,593.00 in fees for a consent Order, two adjournments and a two hour argued motion reasonable or proportionate.
23Mr. Hand does not a have a “free pass” to claim whatever costs he chooses. One cannot litigate with impunity, spending beyond any reasonable amount for a family of similar means, and then press for a full recovery no matter what the circumstances – even with a finding of bad faith tucked into one’s pocket. To so allow would be to ignore the complex nature of costs.
24Proportionality is a core principle that not only governs the conduct of proceedings generally, but is specifically applicable to fixing costs in family law matters. [14]
25How am I then to assess the amount of costs to be paid by Ms. Hand? An examination of his Bill of Costs provides three major insights:
(a) there is a great deal of overlap with the other three motions that were heard September 13, 2018 and for which Justice Jarvis found there to be no basis for recovery; (b) the summer negotiations around a proposed comprehensive Separation Agreement are included, despite not relating to this motion; and (c) also included is the whole of the time related to lengthy Questioning, despite much being attributable to the other issues between the parties.
26Perhaps Mr. Hand has set his Bill of Costs as all of his costs incurred in this proceeding to date. If so, then my task is to pull out the reasonable and proportionate costs applicable to the two motions before me. An important, and easily ascertained measure of such an amount would be the fees and disbursements paid by Ms. Hand, the unsuccessful party. [15] But the mother’s counsel has chosen not to attach a Bill of Costs to her lengthy response materials. [16] Instead, her costs submissions relitigate the issues, going so far as to attach materials not before the court on the motion.
27I am therefore left with my own analysis of the actual time spent on these two motions, an assessment of reasonableness and proportionality in the specific context of this decision per Rule 24(12) and a view of what amount will best achieve the purposes of a costs award.
28I award Mr. Hand a full recovery of $24,500 in fees and $2,500 in disbursements; plus HST.
Means of the Mother
29The mother’s counsel briefly alludes in her submissions to an inability to pay an award of costs. I do not accept that the mother lacks the means to pay an Order for costs in this amount. The purchase price of her home demonstrates otherwise.
Return of the Motion
30The father asserts that the mother’s Financial Statement, required by my Order of September 21, 2018 to be filed by October 15, 2018 is deficient. I will deal with any failure to file a comprehensive Financial Disclosure within the later motion(s.)
31Counsels are gently reminded to exchange fresh Rule 18 Offers to Settle prior to the return of the motion. Any decision on costs following my decision on the return of the motion will start with a review of the Offers to Settle.
Justice H. McGee Date: November 15, 2018