Court File and Parties

Court File No.: 400/15 Date: 20200221 Superior Court of Justice – Ontario

Re: Juliana Boehler-Augustin, Applicant And: Manfred Boehler, Respondent

Before: Justice A.C. Trousdale

Counsel: Lucienne MacLauchlan, Counsel for the Applicant Kurt W. Anders, Counsel for the Respondent

Heard: In chambers

Costs Endorsement

[1] I heard a five day trial in this matter regarding the issues of equalization of net family property, imputation of income, spousal support, child support, and Section 7 expenses. I released a written decision in this matter on November 29, 2019. I indicated in that decision that if the parties were unable to agree on costs, they could make written submissions to me regarding costs. Both parties have made submissions regarding costs.

[2] The Applicant is seeking full indemnity costs in the sum of $40,449.10 inclusive of fees, HST and disbursements. The Applicant also seeks full indemnity of a special disbursement of $4,775.93 paid to International Counterintelligence Services, Inc. which the Applicant states was incurred in June, 2015 prior to the commencement of this litigation. The total costs sought by the Applicant are $45,225.03.

[3] The Respondent’s position is that success on most issues in the trial was divided. He also submits that as the Respondent did not act in bad faith or with malice, costs on a full recovery basis as claimed by the Applicant are inappropriate. The Respondent submits that the Applicant’s Bill of Costs should be reduced by at least 50% and that the special disbursement of $4,775.93 should not be allowed.

Rule 24 of the Family Law Rules

[4] Rule 24 of the Family Law Rules deals with the issue of costs. Subrule 24(1) provides that there is a presumption that a successful party is entitled to costs.

[5] Subrule 24(12) provides that in setting the amount of costs, the court shall consider the reasonableness and proportionality of a number of factors as they relate to the importance and complexity of the issues which I will now consider on the facts of this matter.

The importance, complexity or difficulty of the issues in this proceeding

[6] The issues in this proceeding were very important financial issues for both the parties. The location of a number of the Respondent’s assets in Germany, the language differences, and the currency differences made this proceeding more complex.

Each party’s behaviour

[7] I found the Applicant to be straightforward in her evidence and most of her claims were backed up with documentary evidence.

[8] I found in my decision that the Respondent’s financial disclosure was inadequate and severely lacking in many respects. For example, evidence of the Respondent’s Canadian income for 2018, (the Respondent’s 2018 Canadian Tax Return Summary - not the full income tax return) was only produced in the course of the trial. There were no draft rental statements produced for the Respondent’s German rental income for 2017 and 2018, resulting in no documentary evidence before the court of the Respondent’s net rental income for 2017 and 2018. The rental statements must have been available for the Respondent to file his 2017 and 2018 German income tax returns even if the returns themselves were not available as they apparently take two years to process. The Respondent produced no documentary proof regarding the annual amount of his German pension.

[9] I also found that the Respondent changed his position on various financial issues during the trial even where that position contradicted the Respondent’s pleadings or documentary evidence filed by the Respondent.

[10] I did not make a finding of bad faith on the part of the Respondent in my decision, and I do not do so now. However, in determining the issue of costs, I do take into account the Respondent’s lack of adequate financial disclosure and his various changes in position which lengthened the trial and increased the cost of the trial.

Time spent by each party

[11] The Applicant’s counsel spent 120 hours from the time of the Trial Scheduling Endorsement Meeting to the conclusion of this matter including preparation for and conduct of a five day trial and preparation of submissions regarding costs, but excluding the motion in November, 2018 as costs were already determined in that motion.

[12] The Respondent submits that some of the hours put forward for certain items in the Applicant’s Bill of Costs are excessive and should be reduced by at least half.

[13] The Respondent did not put forward any Bill of Costs of his counsel so it is not possible to compare whether the time spent by the Respondent’s counsel is in line with the time spent by the Applicant’s counsel.

[14] Preparation for a five day trial and conduct of a five day trial takes considerable time. I find that the Bill of Costs put forward by the Applicant’s counsel is reasonable in the circumstances of this case, given a five day trial and the complexities of assets outside Canada.

Written Offers to Settle

[15] Neither party made any offer to settle which would call for the costs consequences of Rule 18(14) of the Family Law Rules. However, I have the discretion to consider other offers to settle when considering the issue of costs.

[16] The Applicant submits that she was never adequately informed about the Respondent’s financial position to enable her to make an Offer to Settle with respect to equalization of net family property. The Applicant did make one offer to settle dated May 1, 2019 which dealt with all issues except the equalization of net family property which issue would need go to trial.

[17] The results of the trial were less favourable to the Applicant than her offer to settle with respect to the issues of monthly child support and spousal support as the Applicant sought to impute income to the Respondent of $100,000.00 per year. I imputed income to the Respondent of $63,452.00. The Respondent’s position was that his income should be found to be $44,000.00 per year.

[18] The Respondent did not put forward before me any offers to settle. The Applicant states that the Respondent made one offer to settle in correspondence but as I do not have that offer to settle before me and do not know all the terms or whether it was still in effect at the opening of the trial, there is no offer to settle by the Respondent for me to consider.

Legal Fees

[19] The Applicant’s counsel has been called to the Bar for 28 years and has 21 years of Family Law experience. The rate charged by the Applicant’s counsel is $300.00 per hour. I find the rates of the Applicant’s counsel to be reasonable given her experience.

Any Expert Witnesses

[20] No expert witnesses were called by either party.

Expenses Properly Paid or Payable

[21] The Applicant claims disbursements of $151.68 plus HST for photocopy expense, tabs and binders. The Respondent does not appear to dispute those disbursements. Those disbursements appear reasonable to me.

[22] The Applicant also claims reimbursement for a disbursement incurred by her in in the sum of $4,775.93 for a payment made to International Counterintelligence Services Inc.

[23] In the Applicant’s submissions as to costs, it is stated that this bill was incurred in June, 2015 which on review of the documentation, I believe may be incorrect. The parties separated on August 15, 2015. The Applicant commenced her Application on September 3, 2015. The Sales Receipt for the services is dated 11/6/2015 as a non-refundable deposit, and the payment by the Applicant according to her credit card statement produced, was made on November 6, 2015. Accordingly, in my view the Sales Receipt was dated November 6, 2015 rather than June 11, 2015. This would have been a date subsequent to the Applicant commencing the Application.

[24] The Respondent served his Answer/Claim and Financial Statement on November 2, 2015. A Case conference date had already been set for November 16, 2015. It appears to me that the Applicant contracted for the investigation services after receiving the Respondent’s documentation but prior to the Case Conference being held 10 days later.

[25] At that Case Conference an Order was made for the Respondent to make the disclosure requested by the Applicant including bank account statements for the Respondent’s German bank accounts. The Respondent argues that the investigation service only showed up two bank accounts for which the Respondent had already provided information to the Applicant prior to being shown the investigation results. The Applicant did not dispute that submission in her Reply regarding costs.

[26] I find that the Applicant’s contracting for the investigation services was premature having been incurred prior to disclosure being ordered at the Case Conference. I find that the Respondent should not have any responsibility for that disbursement.

Any other relevant matter

[27] I am not aware of any other relevant matter.

Conclusion

[28] At the beginning of trial, the Applicant was claiming an equalization payment of $100,000.00 in her draft order submitted to the court. By the end of trial, the Applicant was claiming a substantially larger equalization payment of over $200,000.00.

[29] The Respondent was claiming both at the beginning and at the end of trial that there was no equalization payment owing to the Applicant.

[30] I found that the Respondent owed an equalization payment of $169,813.16 to the Applicant. Accordingly, the Applicant had significant success on that issue although not as much as she claimed at the end of the trial.

[31] The major reason why the Applicant was not as successful as her claim at the end of the trial related to her lack of success on her claim that $150,000.00 should be shown on the Respondent’s side of the net family property statement for a home which he had previously owned but had transferred to his son prior to meeting the Applicant, based on an alleged agreement between the Respondent and his son that the son would pay $150,000.00 to the Applicant if the Applicant ever decided to move away from the original home located on the property. This claim by the Applicant was unsuccessful but that issue did take up some time at the trial.

[32] In spite of the evidence being clear prior to trial that there would be an equalization payment owing by the Respondent to the Applicant, I find that the Respondent persisted in his position that no equalization payment was owing. I find that the Respondent made no reasonable offer to settle this matter and continued his unreasonable position on this issue throughout the trial.

[33] The Applicant achieved substantial success on the issue of the equalization payment owing to her, which was a very important issue for her.

[34] The Applicant was successful in obtaining child and spousal support greater than that put forward by the Respondent, but not as great as she argued should be paid at trial. This was based on my imputing income to the Respondent but not as high as the Applicant claimed should be imputed. The Applicant was successful in obtaining retroactive Section 7 expenses.

[35] In the case of Mattina v. Mattina, 2018 ONCA 867, the Ontario Court of Appeal summarized the general legal principles regarding costs orders in family law proceedings. At paragraph 10 of Mattina, the Ontario Court of Appeal set out the four fundamental purposes that modern family cost rules are designed to foster as follows:

(1) to partially indemnify successful litigants; (2) to encourage settlement; (3) to discourage and sanction inappropriate behaviour by litigants; and (4) pursuant to Rule 2(2) of the Family Law Rules, to ensure that cases are dealt with justly.

[36] To those four fundamental purposes, the Court of Appeal added a reference to Rule 24(12) of the Family Law Rules which specifically emphasizes “reasonableness and proportionality” in any costs award.

[37] Based on the Applicant having much greater success overall than the Respondent at trial, but not achieving the degree of success claimed by her, I find that the Applicant is entitled to partial indemnity costs rather than to full indemnity costs.

[38] Taking into account all of the aforesaid factors including reasonableness and proportionality, and in the exercise of my discretion, I find that it is fair and reasonable in all the circumstances of this particular case that there be an order that the Respondent pay costs to the Applicant fixed in the sum of $25,900.00 for fees including HST plus disbursements of $171.40 including HST for a total of $26,071.40. One of half of these costs shall be attributed to costs incurred by the Applicant to obtain child and spousal support and shall be enforceable by the Family Responsibility Office as such.

Order

[39] Final Order to go in accordance with this endorsement.

Justice A.C. Trousdale Released: February 21, 2020