Kraemer v. Kraemer, 2019 ONSC 2072
COURT FILE NO.: 435/17 DATE: 2019 04 04 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Stacey Lynn Kraemer, Applicant AND: Lawrence Francis Kraemer, Respondent
BEFORE: Justice G.D. Lemon
COUNSEL: Ms. Diana M. Piccoli, Counsel for the Applicant Mr. Patrick Kraemer, Counsel for the Respondent
HEARD: In writing
Costs ENDORSEMENT
The Issue
[1] On March 1, 2019, I ordered Mr. Kraemer to produce all of his outstanding undertakings along with 17 answers that he took under advisement and four questions that he had refused to answer. I also ordered that he produce a business valuation. I did not grant Ms. Kraemer’s request for an income valuation, her request that her counsel be allowed to question Mr. Kraemer’s bookkeeper, or her request that Mr. Kraemer produce an appraisal of the matrimonial home.
[2] Ms. Kraemer submits that she was successful and seeks costs in the amount of $14,138.74.
[3] Mr. Kraemer submits that given the mixed results, there should be no order as to costs.
Authorities
[4] 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]
[5] The fact that 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
[6] Mr. Kraemer relies upon the case of Takhar v. Takhar, 2009 CarswellOnt 8172 to submit that since success has been divided, there should be no costs. I prefer to rely upon Thompson v. Drummond, 2018 ONSC 4762 where Chappell J. said that the determination of success is not a simple mathematical exercise: “Rather, it requires a contextual analysis that takes into consideration the importance of the issues that were litigated and the amount of time and expense that were devoted to the issues which required adjudication…”.
[7] While I did not order everything that Ms. Kraemer sought, I declined some of her other requests because the information that I did order Mr. Kraemer to produce would likely fulfill those requirements.
To that end, I note that Mr. Kraemer submits that “The Court Ordered that the Respondent is not required to obtain an appraisal of the matrimonial home.” That was not the result of my endorsement that read:
Accordingly, Mr. Kraemer shall provide the opinion of value of Paul Martin within 30 days. If Mr. Kraemer is not relying on that value, he shall provide the evidence upon which he relies for his valuation of the home in his financial statement within 30 days.
[8] The end result of my endorsement was that Ms. Kraemer will likely get all she needs to proceed, if not all she asked for. Accordingly, Ms. Kraemer was successful and Mr. Kraemer was not. She is presumed to be entitled to her costs.
[9] Given the pronouncements from the Court of Appeal and many of my fellow judges, the failure to make financial production in family litigation is unreasonable. To fail to produce that information based on undertakings is worse. Mr. Kraemer has been unreasonable and that behaviour should be discouraged.
[10] Mr. Kraemer submits that his costs for the same motion were only $3,318.30. That is not surprising given that he filed no responding affidavit. I also note that Mr. Kraemer’s bill of costs indicates that he billed only two hours for the motion attendance. The motion was set for 10:00 a.m. and argued between approximately 11:15 a.m. to 1:15 p.m. Mr. Kraemer’s counsel practices in Waterloo – about an hour away. In contrast, Ms. Kraemer’s counsel billed four and a half hours for that attendance. Her bill would seem to be more in line with the usual practice. Finally, Mr. Kraemer is represented by his brother. One would hope that his bill would be substantially cheaper.
[11] Motions for undertakings and productions are detailed, voluminous and expensive. It is not unreasonable that Ms. Kraemer’s counsel incurred five times the expense to detail all of Mr. Kraemer’s failings.
[12] Mr. Kraemer makes no specific submissions finding any fault with the Bill of Costs. I have reviewed it and it seems reasonable. Where possible, the work has been downloaded to a less expensive junior associate.
[13] Although there were no offers to settle, given the issues in dispute, that is not unexpected.
[14] Taking all of those factors into consideration, I am satisfied that Mr. Kraemer shall pay costs in the amount of $14,138.74 within 30 days.
Lemon J. Date: April 4, 2019