COURT FILE NO.: FS-17-90997-00
DATE: 2019 02 22
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Urmila Malik, Applicant
- and -
Binesh Malik, Respondent
BEFORE: Lemon J.
COUNSEL: Georgina L. Carson, Serena Lein, Counsel for the Applicant
Anita Kania, Counsel for the Respondent
HEARD: In Writing
costs ENDORSEMENT
The Issue
[1] At the outset of the motion, Ms. Malik sought an order for exclusive possession of the home and its contents, a restraining order against Mr. Malik, damages for “inclusion on seclusion,” a non-depletion order, retroactive and ongoing child and spousal support, life insurance, medical and dental benefits, interim disbursements in the amount of $150,000 and an advance on her equalization payment of $500,000. Those were the issues that the parties came prepared to argue.
[2] Because of time constraints, some issues were resolved and some issues were adjourned. I was left to determine:
Sanctions with respect to Mr. Malik’s breaches of Snowie J.’s order of May 23, 2018, if in fact he had breached that order.
A civil restraining order against Mr. Malik.
An advance on equalization or interim disbursements or both “to be characterized at a later date” for Ms. Malik.
Life insurance for Ms. Malik.
[3] Ms. Malik was successful with respect to her claim that Mr. Malik was in breach, but unsuccessful with respect to the other matters.
[4] She seeks costs fixed on a “substantial indemnity” rate of $27,750 plus costs of her costs submissions in the amount of $2,000.
[5] In return, despite having been found that he was “thumbing his nose” at Justice Snowie’s order, Mr. Malik says that he has been successful with respect to a contested adjournment and seeks costs of $1,640.76. He seeks costs of $8,458.05 plus costs of $1,000 for the preparation of costs submissions. In the alternative, he submits that both parties should be responsible for their own costs.
[6] There is little merit to either parties’ positions.
Authorities
[7] In Mattina v. Mattina, 2018 ONCA 867, our Court of Appeal recently said:
[9] Section 131(1) of the Courts of Justice Act, provides that cost orders are in the discretion of the court. Rule 24 of the Family Law Rules sets out a framework for awarding costs for family law cases in the Family Court of the Superior Court of Justice, in the Superior Court of Justice and in the Ontario Court of Justice. Although the Family Law Rules do not expressly govern costs awards in the Court of Appeal, they have been used to guide this court’s analysis on costs in family law disputes.
[10] This court has held that modern family cost rules are designed to foster three fundamental purposes: (1) to partially indemnify successful litigants; (2) to encourage settlement, and; (3) to discourage and sanction inappropriate behaviour by litigants. Rule 2(2) adds a fourth fundamental purpose: to ensure that cases are dealt with justly, and Rule 24(12), which sets out factors relevant to setting the amount of costs, specifically emphasizes “reasonableness and proportionality” in any costs award.
[11] The Family Law Rules are a marked departure from some aspects of the Rules of Civil Procedure. As such, case law pertaining to costs decided under the Rules of Civil Procedure should be approached with some caution.
[12] Rule 24(1) creates a presumption of costs in favour of the successful party of a motion, case, or appeal and the presumption that a successful party is entitled to costs applies equally to custody and access cases.
[13] Consideration of success is the starting point in determining costs. This presumption does not, however, require that the successful party always be entitled to costs. An award of costs is subject to: the factors listed in r. 24(12), r. 24(4) pertaining to unreasonable conduct of a successful party, r. 24(8) pertaining to bad faith, r. 18(14) pertaining to offers to settle, and the reasonableness of the costs sought by the successful party.
[14] Rule 24(12) sets out a list of factors the court shall consider in determining an appropriate amount of costs:
(a) the reasonableness and proportionality of each of the following factors as it relates to the importance and complexity of the issues:
i. each party’s behaviour,
ii. the time 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 lawyers 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
(b) any other relevant matter.
[15] The Family Law Rules only expressly contemplate full recovery costs in specific circumstances, e.g. where a party has behaved unreasonably, in bad faith or has beat an offer to settle under r. 18(14).
[16] Rule 24(4) addresses the situation in which a successful party has behaved unreasonably:
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.
[17] Rule 24(5) provides guidance on how to evaluate reasonableness:
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;
(b) the reasonableness of any offer the party made; and
(c) any offer the party withdrew or failed to accept.
[18] Rule 24(8) discusses the cost consequences for a party who has acted in bad faith:
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. [Citations removed]
[8] Just because an award of costs may be on a full indemnity basis does not mean that the successful party is entitled to whatever costs were incurred. The court assessing costs is still required to consider all of the factors in such an award. United Soils Management Ltd. v. Mohammed, 2019 ONCA 128.
Analysis
[9] Mr. Malik is lucky that he was not found in contempt. He was ordered to pay $30,000 plus $5,000 per month until his productions were provided. This was the principle issue for this motion. He was not successful. He is not entitled to costs.
[10] On the other hand, Ms. Malik seeks costs as though she were successful on all issues argued or not argued. She is entitled to costs but not a blank cheque.
[11] Ms. Malik’s bill of costs sets out work done by a lawyer with 27 years of experience and a lawyer with 7 years of experience. Much of the time docketed is while the two of them worked together on the same matter on the same date. This motion was certainly something that a 7 year lawyer could have dealt with on her own. Perhaps a bit of mentoring from senior counsel might have been of some assistance but it certainly did not need both lawyers on a full time basis.
[12] At the hearing of the motion, Ms. Malik’s counsel provided a thick volume of cases. Few, if any, were referred to. None were helpful on this standard family law production motion. I advised counsel that I would not allow her to bill for that unnecessary case law. She has done so in any event.
[13] Although I asked for costs submissions of three pages, I received a document of 22 tabs with a variety of boiler plate cases well known to the family law bar. That was wasted time, paper and billing.
[14] To their credit, both parties provided offers to settle; however, I can understand why they were not accepted.
[15] The motion was heard November 27, 2018. On the date before the motion, Ms. Malik made an offer to settle. Among other issues, she proposed to settle by way of a payment of a dividend cheque for $200,000, spousal support of $7,500 per month, a restraining order and life insurance. The terms of the offer were not severable. She did not get those important points out of her motion. She did not, as she submits, “beat her offer”.
[16] Ms. Malik submits that “an offer which represents nothing more than an invitation to capitulate fails to satisfy the underlying purpose of the rules . . .”. I agree. However, her offer, presented the day before the motion, is exactly that.
[17] Mr. Malik made an offer on November 19, 2018. The terms of that offer were severable. By the terms of Mr. Malik’s offer, Ms. Malik could have accepted spousal support in the amount of $5,000 per month. She could have been designated as irrevocable beneficiary of Mr. Malik’s life insurance in the amount of $1,000,000. She could have had $100,000 from a line of credit secured by the home. While I can understand why she did not accept that last term, in the end result, she would have been better off accepting all of those terms and leaving the production issues to be argued. But Mr. Malik’s offer is essentially silent on the production issue upon which he was unsuccessful.
[18] Accordingly, the offers do not affect the determination of costs.
[19] The parties dispute who was responsible for adjournments and who should pay those costs. I cannot make that determination on these materials. Given Mr. Malik’s lack of success on the principal issue, his request is denied in any event.
Result
[20] Taking all of those factors into consideration, I order Mr. Malik to pay costs in the amount of $10,000, payable forthwith.
[21] Ms. Malik offered to settle the issue of costs. That offer was provided in a sealed envelope. I did not review it until I had completed this endorsement. She offered to settle costs for $17,000. That offer does not affect the above result.
Justice G.D. Lemon
Date: February 22, 2019
COURT FILE NO.: FS-17-90997-00
DATE: 2019 02 22
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Urmila Malik
Applicant
– and –
Binesh Malik
Respondent
COSTS ENDORSEMENT
Lemon, J
Released: February 22, 2019