Court File and Parties

COURT FILE NO.: FC-18-1678 DATE: 20190530 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN: Ma.M. Applicant – and – A.W.M. Respondent

Counsel: Edith Holly, for the Applicant Erin Lepine, for the Respondent

HEARD: By written submissions

Decision on Costs

Audet J.

[1] On April 2, 2019, I heard a lengthy motion dealing with custody and access to the parties’ 13-year-old son, B.A.M., appointing the Office of the Children’s Lawyer for him, the mother’s alleged contempt, child support and spousal support. My Decision related to parenting issues was released on April 5, 2019 (2019 ONSC 2128). My Decision on support issues and the issue of contempt was released on April 8, 2019 (2019 ONSC 2136). This is my Decision on costs.

[2] I conclude that the mother is liable to pay the father’s costs in the context of this motion on a full recovery basis, in the amount of $32,055.51. I have also decided to defer the payment of this cost award to the occurrence of one of the following events, whichever comes first;

• The day the parties reach a final settlement of the financial issues raised in this proceeding;
• The day that a final decision is made by the court on the financial issues raised in this proceeding.

Until the above cost award is paid, it shall bear interests at the rate of 3% per annum.

Result Achieved in the Context of the Motion

[3] The primary issue raised by this motion related to the parenting of the parties’ 13 year old son, B.A.M. The evidence before me revealed that for nearly three months, the mother refused to facilitate any contact between B.A.M. and his father, contrary to an agreement reached by the parties after they separated, and contrary to the clear order of Justice Doyle made on December 6, 2018 after a full-blown motion, and pursuant to both of which the parties were to have equal time-sharing with B.A.M.

[4] In my Decision on parenting issues, I came to the conclusion that the mother had engaged in significant alienating behaviours for the clear purpose of causing harm to B.A.M.’s relationship with his father. I granted the father temporary sole custody and put B.A.M. in his primary care without access to the mother for a period of two months. In light of my findings with regard to the mother’s alienating behaviors, I dismissed the mother’s request for the appointment of a lawyer for B.A.M.

[5] In my Decision related to all other issues, I concluded that no child support was payable by either party on a temporary basis, I ordered the father to pay temporary without prejudice spousal support in the amount of $3000 per month, and I deferred the issue of the mother’s alleged contempt to a later date, requiring the mother to provide additional evidence to the court.

Legal Framework

[6] Modern costs rules are designed to foster four fundamental purposes (1) to partially indemnify successful litigants; (2) to encourage settlement, (3) to discourage and sanction inappropriate behaviour by litigants and; (4) to ensure that cases are dealt with justly under subrule 2 (2) of the Family Law Rules, O. Reg. 114/99 (“the rules”) (Mattina v. Mattina, 2018 ONCA 867).

[7] Costs can be used to sanction behaviour that increases the duration and expense of litigation, or is otherwise unreasonable or vexatious. In short, it has become a routine matter for courts to employ the power to order costs as a tool in the furtherance of the efficient and orderly administration of justice (British Columbia (Minister of Forests) v. Okanagan Indian Band, 2003 SCC 71, [2003] 3 S.C.R. 371).

[8] Subrule 24(1) of the rules creates a presumption of costs in favour of the successful party. Consideration of success is the starting point in determining costs (Sims-Howarth v. Bilcliffe, 2000 ONSC 22584, 6 R.F.L. (5th) 430). To determine whether a party has been successful, the court should take into account how the order compares to any settlement offers that were made (Lawson v. Lawson). The position each party took at trial or at the motion should also be examined.

Success

[9] The father was undeniably the successful party on the main issues raised in this motion. He was granted primary residence and sole custody of B.A.M. on a temporary basis, without access to the mother; his child support obligation was suspended and the mother’s request for the appointment of the OCL was denied.

[10] While the mother achieved success on the issue of temporary spousal support, it is important to note that she obtained far less than what she was seeking at the motion. More importantly, the father was prepared to settle for more than the payment of $3000 per month in spousal support, as will be discussed in more details below.

Offer to Settle

[11] Offers to Settle are the yardstick with which to measure success and are significant both in considering liability and quantum as set out in Osmar v. Osmar, 2000 ONSC 20380, 8 R.F.L. (5th) 387. Subrule 18 (14) of the rules sets out the cost consequences of failing to accept an Offer to Settle:

18(14) A party who makes an offer is, unless the court orders otherwise, entitled to costs to the date the offer was served and full recovery of costs from that date, if the following conditions are met:

1. If the offer relates to a motion, it is made at least one day before the motion date.
2. If the offer relates to a trial or the hearing of a step other than a motion, it is made at least seven days before the trial or hearing date.
3. The offer does not expire and is not withdrawn before the hearing starts.
4. The offer is not accepted.
5. The party who made the offer obtains an order that is as favourable as or more favourable than the offer.

[12] On November 19, 2018, the father made an Offer to Settle which provided for;

• the payment of a $10,000 lump sum to the mother to be credited against any further amounts found to be owing by the father to mother in the proceedings or under the parties’ marriage contract;
• ongoing spousal support in the amount of $3000 per month;
• joint custody of the child with equal timesharing;
• child support of $2173 per month based on the father’s income of $271,344 and an imputed income of $20,000 to the mother.

[13] This Offer to Settle met all of the criteria set out in rule 18(14), and remained open to the date of the motion. While it was made prior to the December 6, 2018 motion before Justice Doyle, the father’s counsel made it very clear to the mother’s counsel on January 16, 2019 (after the mother terminated access once again), that the offer remained open for acceptance. The result achieved by the father at the motion before me was as favourable as, or more favourable than, what he was willing to settle for. On that basis alone, I find that the father is entitled to full recovery costs for this motion.

[14] The mother did not make any formal Offer to Settle. However, on the morning of the December 6, 2018 motion hearing before Justice Doyle, she made an Offer to Settle which was forwarded by her counsel to the father’s counsel. I have no evidence that would indicate whether or not that offer remained open for acceptance after the December 6, 2018 hearing. In any event, the mother’s offer was clearly not as favourable as or more favourable than the results she achieved in her motion before me.

Bad Faith and Unreasonable Behaviour

[15] Pursuant to subrule 24(8), where a party has acted in bad faith, the court shall order costs on a full recovery basis, payable forthwith. The intentional failure to follow an order or an agreement to achieve an ulterior motive will constitute bad faith. In order to come within the meaning of bad faith, the behaviour must have been carried out with intent to inflict emotional harm on the other party, or to deceive the other person or the court (Erickson v. Erickson, ). Such intent does not need to be the party’s sole or primary intent, but only a significant part of the person’s intent. Unreasonable behaviour, even if it does not rise to the level of bad faith, can trigger an order for costs on a full recovery basis.

[16] In S. (C.) v. S. (M.) (2007), 38 R.F.L. (6th) 315 (Ont. Sup. Ct.) (Fam. Div.), a leading case on the issue of bad faith, Justice Perkins came to the following conclusion, at para. 21:

There are, however, some aspects of the father’s behaviour in this case as found in my reasons of 27 February 2007 that do fall within “bad faith” as intended by the rule. He deliberately did not obey court orders in the case, including orders to which he consented. He made complaints against lawyers and other professionals, when he was unhappy with the way they performed their duties, not merely to report what he believed to be negligence or misconduct, but also as his form of punishment and vengeance. Most significantly, though, the father waged a campaign against the mother, both through and with the children, to alienate the children from her, a form of emotional harm to the children and to her, and to cause her emotional distress. This was done in the guise of forging closer ties with the children. It is true that the mother was not blameless in dealing with the children but, as between the two parents, I found his motives were to cause harm to the existing bond between the children and the mother, whereas the mother was trying to hang on to her relationship with her children rather than to harm the father’s relationship with them.

[17] I find that the mother’s behavior in relation to the child’s contact with his father rises to the level of bad faith. In my prior Decision, I found that she had engaged in significant alienating behaviours and that she had significantly influenced and encouraged B.A.M.’s rejection of his father. Her conduct was clearly designed to undermine and destroy B.A.M.’s relationship with his father. She unilaterally terminated access between B.A.M. and his father within weeks of an order being made by Justice Doyle imposing an equal timesharing arrangement after a full motion hearing where all of the mother’s arguments against it were heard and assessed. I found that her allegation that the Children’s Aid Society had given her direction to suspend access was untrue. I also found that she had breached many other aspects of Justice Doyle’s Order without reasonable explanation.

[18] On the basis of the above, I would have come to the conclusion that the father was entitled to full recovery costs for the vast majority of the issues raised in this motion, even if his Offer to Settle had not been as favourable as, or more favourable than, the result he achieved ultimately.

Quantum

[19] The father seeks his full costs in the amount of $32,055.51 for the following steps leading to and including the motion before me:

• the motion heard on February 19, 2019 where leave was granted to the mother to bring her motion for the appointment of the OCL on an urgent basis;
• the motion hearing of February 26, 2019 where the issue of the appointment of the OCL was heard and adjourned; and,
• the motion heard by myself on April 2, 2019 where all issues were heard and determined.

[20] In setting the amount of costs, the court is required to consider the following factors set out in subrule 24(12):

(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, (iii) any legal fees, including the number of lawyers and their rates, (iv) any expert witness fees, including the number of experts and their rates, (v) any other expenses properly paid or payable; and (b) any other relevant matter.

[21] Subrule 24(5) provides criteria for determining the reasonableness of a party’s behaviour in a case (a factor in clause 24(12)(a) (1) above). It reads as follows:

(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; (b) the reasonableness of any offer the party made; and (c) any offer the party withdrew or failed to accept.

[22] I have reviewed the father’s counsel’s Bill of Costs and I find that the hourly rates charged by his counsel and a junior lawyer from her firm were reasonable. Given that three different hearings were held, given the relative complexity of the main issues raised in this motion (in particular the allegations of parental alienation and the request for interim spousal support in the face of a marriage contract), and given the importance of the main issue before the court (B.A.M.’s ongoing relationship with his father), a significant amount of evidence had to be marshaled and provided to the court, on three occasions. I find that the number of hours charged by the father’s counsel was reasonable, although at first glance it may seem quite high.

[23] More specifically, it is important to note that the mother had already been put on judicial notice that her behaviour in relation to unilaterally suspending access was unreasonable and unjustifiable. On January 31, 2019, Justice Doyle released her Decision on costs of the December 6, 2018 motion. In considering the mother’s conduct to that point, the court stated:

I find that the mother was unreasonable in her position to deny access. There was no evidence before me that showed that the father was a threat to the child. The mother may have had concerns regarding the father’s parenting but these were not substantiated. […] there was no evidence of the concerns that would affect the child’s best interests in having an ongoing relationship with his father.

[24] Justice Doyle imposed $5000 for costs to the mother for the December 6, 2018 motion. Despite this clear and unequivocal direction, the mother persisted. She chose, once again, to deny access on the basis of concerns which had already been assessed by Justice Doyle and found to be unsubstantiated. It would appear that Justice Doyle’s costs award did not have any measurable effect on her behaviour and her position in this litigation, as well as her actions, remained unchanged.

[25] Finally, the mother did not provide me with her counsel’s Bill of Costs. In her submissions, her counsel states that her account “totalled $1,700 after reduction”. While the mother’s counsel may have chosen to reduce her client’s account for various reasons, I do not accept that the amount of $1,700 is a reasonable or proportional amount of legal fees that one might have expected to pay in the context of this motion which required three hearings in total.

Conclusion

[26] In light of all the above, an order shall issue requiring the mother to pay to the father full recovery costs in the amount of $32,055.51.

[27] I am however mindful of the fact that the mother is of limited financial means. In the context of this court application, she seeks to set aside a marriage contract signed by the parties before their marriage, and which provides for the payment of lump-sum spousal support in the amount of $150,000 as well as monthly support sufficient to top up her income to $36,000 per year for a period of seven years. Should she be successful in her claim, she will undoubtedly be entitled to spousal support at least equal to what the marriage contract provides (although quantum and duration are unknown at this time). If she is unsuccessful in her claim, she will then be entitled to a lump sum spousal support in the amount of $150,000 (less any amount paid by the father on account of temporary spousal support), which will be largely sufficient to cover the within cost award.

[28] In those circumstances, it is appropriate in my view to defer the payment of this cost award to the date that the financial issues are either resolved or determined on a final basis. I also find it appropriate to apply a reasonable rate of interest on the costs owing by the mother until such time as they are paid.

Madam Justice Julie Audet Released: May 30, 2019