Court File and Parties
COURT FILE NO.: FC-17-133-00
DATE: 2019 01 29
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Gregory Marlon Palmer, Applicant
- and -
Elaine Lumsden, Respondent
BEFORE: Lemon J.
COUNSEL: Zarie Lorne, Counsel for the Applicant
Jide Oladejo, Counsel for the Respondent.
HEARD: In Writing
COSTS ENDORSEMENT
The Issue
[1] Mr. Palmer requested an interim order that the jointly owned home should be sold. On December 13, 2018, I dismissed his motion. Ms. Lumsden has provided her costs submissions. She seeks costs in the amount of $9,166. In response, Mr. Palmer submits that there should be no costs payable by either party.
Authorities
[2] 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]
Analysis
[3] Ms. Lumsden has been successful and is therefore presumed to be entitled to her costs.
[4] Although both parties made offers to settle, those related to the issues in the action as a whole. Neither party made an offer with respect to the motion itself.
[5] Mr. Palmer submits that I should take into consideration his financial circumstances. However, he will have funds available to him upon resolution of the action between the parties. The issue for trial is not whether he is entitled to funds from Ms. Lumsden but how much he is to be owed if she keeps the house or what he should obtain from the proceeds of sale if it is eventually sold.
[6] Both parties have attempted to settle the action but have been unsuccessful in doing so. I do not see that either have been so unreasonable in their conduct to be a factor in determining costs.
[7] For the most part, the law supports Mr. Palmer’s position. Ultimately, the result turned on my balancing a number of factors. Although Mr. Palmer was unsuccessful, he was not unreasonable in bringing the motion.
[8] Ms. Lumsden’s bill of costs sets out a great deal of work carried out before the motion was brought. It is not appropriate that I award costs related to the action itself. This order should only relate to the costs of the motion.
[9] Mr. Palmer’s counsel confirms that Mr. Palmer’s costs amount to $3,187.50. Accordingly, he would be aware of the costs of the motion if he were unsuccessful.
[10] Taking all of the factors into consideration, I order Mr. Palmer to pay costs to Ms. Lumsden fixed in the total amount of $5,000. Those costs shall be payable from his share of the proceeds of sale if the house is sold or, alternatively, upon judgment in the action.
Justice G.D. Lemon
Date: January 29, 2019
COURT FILE NO.: FC-17-133-00
DATE: 2019 01 29
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Gregory Marlon Palmer
Applicant
– and –
Elaine Lumsden
Respondent
COSTS ENDORSEMENT
Lemon, J
Released: January 29, 2019