COURT FILE NO.: FC-19-1022

DATE: 20201019

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Benny Di Raimo, Applicant AND: Marlene Gidiago Di Raimo, Respondent

BEFORE: The Honourable Mr. Justice J.P.L. McDermot

COUNSEL: Stephanie Di Federico, for the Applicant Jesse Schmidt, for the Respondent

HEARD: By written submissions

costs ENDORSEMENT

[1] On August 7, 2020, I heard a motion concerning primary residence of the two children of these parties, Savannah and Nicholas. When the motion was argued, the children were living with the Applicant, Mr. Di Raimo, in Etobicoke. The Respondent, Ms. Di Raimo, lived in Barrie. Each party wanted care of the children and that they attend the school in their respective catchment areas.

[2] Since 2018, those children had lived with Ms. Di Raimo in Barrie. In March 2020, the children went to stay with Mr. Di Raimo because the Respondent was on holidays and was later hospitalized. When the Respondent said that she was better, Mr. Di Raimo had doubts about her recovery and refused to return the children. That refusal was in the face of a separation agreement entered into between the parties the previous fall which gave Ms. Di Raimo custody of the children. At issue was the binding effect of the separation agreement and whether the children should be returned to Ms. Di Raimo’s care as a result of that agreement.

[3] At the motion, I determined that the agreement did not meet the best interests of the children because of Ms. Di Raimo’s medical issues, and because she withheld her health information from both the court and Mr. Di Raimo. I ruled that the children should continue living with the Applicant, essentially reversing the custodial arrangement agreed to between the parties contained in the separation agreement.

[4] Mr. Di Raimo now requests full recovery costs of $13,882.05 based upon his success in the motion and an offer to settle which included a custodial order in line with what I ordered. He also complains that Ms. Di Raimo was guilty of unreasonable behaviour which he says would also warrant full recovery costs.

[5] Ms. Di Raimo says, on the other hand, that Mr. Di Raimo should be deprived of his costs because of his own unreasonable behaviour. She does not really address the Applicant’s offer in her costs submissions, but appears not to have served an offer of her own. She also says that Applicant’s request for costs is excessive and disproportionate; finally she notes that the costs award is unaffordable to her and that costs should be denied or reduced as a result.

Entitlement to Costs

[6] Generally, under Rule 24(1) of the Family Law Rules,[^1] costs follow the event and the successful party is entitled to costs. In the normal course, the Applicant is entitled to his costs as he met with success on the major issue in the motion.

[7] The Respondent suggests, however, that the Applicant be deprived of costs by his own unreasonable behaviour.

[8] There is jurisdiction for this, as Rule 24(4) provides as follows:

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.

[9] Under Rule 24(5), in determining unreasonable behaviour the court may take into account the party’s behaviour in relation to the issues; however, that rule also emphasizes that the court must review a parties’ offer or offers as well as how reasonable that offer might have been.

[10] The Respondent says in her costs submissions that Mr. Di Raimo was “in flagrant and egregious breach of the terms of the Separation Agreement” insofar as she did not see the children between March 12 and July 3, 2020 “despite her constant requests and despite a binding domestic contract in place.” This is not, in fact, an accurate statement. The Respondent went on a trip to Cuba and left the children with the Applicant on March 12 and when she returned after a week, she had to quarantine for 14 days because of COVID 19. It was only after this quarantine was complete that she requested a return of the children and it is acknowledged that the Applicant refused to do so at that time, ostensibly because of COVID. However, soon after this, in May 2020, the Respondent was hospitalized for six weeks and again was not in a position to care for the children. Only after she was released in June did custody then again become a live issue and the Respondent refused to disclose her medical condition to the Applicant. Notwithstanding this lack of disclosure, the Applicant arranged with the Respondent for a July 3 access visit. Another visit was arranged for July 14 but it was cancelled because the Respondent was probably hospitalized; she never really acknowledged that hospitalization.

[11] In sum, for much of the time between March and July, 2020, the Applicant was unavailable to care for the children because of her holiday to Cuba, her subsequent quarantine and her six-week hospitalization. It was not solely because the Applicant overheld the children. I do not find the Applicant’s behaviour to be such that it would deprive him of the costs of this motion.

[12] As well, although this is not a contest, if the Applicant was guilty of unreasonable behaviour, then so was the Respondent. She refused to clarify her medical condition with the Applicant and repeated that conduct in her materials, refusing to disclose to the court in a clear manner as to whether she was hospitalized on July 14 or whether her medical problems were, in fact, at an end. She also made inappropriate statements to the children, especially Savannah, which could be seen as containing some element of emotional blackmail; certainly, she texted statements to Savannah which were upsetting and put pressure on Savannah to return to her care. She said that she was overly emotional because the Applicant refused to return the children; however, that is no excuse when the statements are harmful and upsetting to the children. I do not blame Ms. Di Raimo for being emotional; I do blame her for not isolating the children, and in particular Savannah, from those emotions.

[13] I do not find that either party has a great deal to be proud of. Under the circumstances, however, I find that the Applicant’s behaviour does not affect his entitlement to costs.

Quantum of Costs

[14] The Ontario Court of Appeal in Serra v. Serra, 2009 ONCA 395, [2009] O.J. 1905 confirmed that modern costs rules are designed to foster three fundamental purposes, namely to partially indemnify successful litigants for the cost of litigation, to encourage settlement and to discourage and sanction inappropriate behaviour by litigants bearing in mind that the awards should reflect what the court views is a fair and reasonable amount that should be paid by the unsuccessful party.

[15] The quantum of costs in a family law matter is addressed in Rule 24(12) which states that costs must be based upon “reasonableness and proportionality” and the “importance and complexity of the issues”: see Kang v. Kang, 2018 ONSC 4948 and Shepiashvili v. Shepiashvili, [2001] O.J. No. 2843 (S.C.J.). The parties’ respective behaviour is also to be taken into account as is the “time spent by each party” as well as “legal fees, including the number of lawyers and their rates”.

[16] Finally, under Rule 18 of the Family Law Rules, if an offer complies with the formal requirements of Rule 18(4) and a party obtains an award at trial that is as favourable or more favourable than the offer, that party is entitled to full recovery costs from the date that the offer is made.

[17] Ms. Di Federico on behalf of the Applicant requests full recovery costs based upon his offer to settle. She also requests full recovery costs based upon the Respondent’s unreasonable behaviour.

[18] Mr. Schmidt on behalf of the Respondent says that nearly $14,000 requested by the Applicant is clearly excessive for a one-hour custody motion. As well, he says that his client’s impecuniosity should be taken into account in determining costs. He says that, at best, the award of costs should be “nominal” and no more than $3,500.

Offer to Settle

[19] Mr. Di Raimo made an offer to settle the motion. Included in that offer was a provision regarding care of the children; the offer provided that the children would live with him and would see the Respondent every weekend. As well, the offer provided that the children would attend St. Dorothy’s separate school in Etobicoke. This was exactly what was ordered by me on September 7.

[20] However, the offer specifically stated that it was not severable. It included provisions regarding child support, not argued or ordered at the motion. Although the Applicant suggests in his costs submissions that the failure to address child support is equivalent to the offer that no child support be payable, child support remained an open issue after the motion as the issue was not argued because there was insufficient time to do so. The offer also included a provision regarding counselling for the children, also neither considered at the motion nor ordered.

[21] Offers need need not be exactly the same as the result at trial. The court is not required to examine each term of the offer as compared to the terms of the order and weigh with microscopic precision the equivalence of the terms. However, to trigger full recovery costs a party must do as well or better than all the terms of any offer (or a severable section of an offer). Paranavitana v. Nanayakkara, 2010 ONSC 2257, [2010] O.J. No. 1566 (S.C.J.); Rebiere v Rebiere , 2015 ONSC 2129 (S.C.J.); Scipione v Scipione , 2015 ONSC 5982 (S.C.J.).

[22] The fact that the offer was not severable is particularly concerning. In Paranavitana, Wildman J. comments on non-severable orders at para. 13:

Unfortunately, this offer was not severable. There would have been no disadvantage to the wife in making the custody offer, in particular, severable from the financial and property terms. Severable offers are an underused tool that can confer considerable settlement and cost advantages. Because of the full recovery provisions of Rule 18(14), they can provide much more flexibility to the court to award full recovery for at least a portion of the overall costs, if the party is successful on only some of the issues. Had the custody terms of the wife's offer been severable from the other terms, I would have been prepared to consider ordering full recovery costs on the custody issue from the date of the offer forward. As this was the majority of the trial time, that would have been a significant cost advantage to the wife.

[23] Because the offer was not severable, it does not attract the cost consequences of Rule 18(14). The Applicant’s offer does not result in full recovery costs on the motion.

Unreasonable Behaviour

[24] I have already discussed the Respondent’s behaviour leading up to the motion and concerning these children.

[25] Ms. Di Raimo is guilty of unreasonable behaviour. In addition to her failure to be forthright about her medical condition and her inappropriate discussions with the children, she also failed to serve an offer to settle, which has, in itself, been seen as being unreasonable behaviour: see Laing v. Mahmoud, 2011 ONSC 6737. The failure to serve an offer to settle is an adverse factor when assessing costs.

[26] Ms. Di Raimo’s behaviour did not cross the threshold of acting in bad faith which would result in full recovery costs; I do not find her conduct as being done “knowingly and intentionally” for one purpose when ostensibly being for another: see S.(C.) v. S. (M.) (2007), 2007 CanLII 20279 (ON SC), 38 R.F.L. (6th) 315 (Ont. S.C.J.).

[27] Therefore, although Ms. Di Raimo’s conduct, especially her acknowledged lack of clarity about her medical condition, resulted in the costs being increased in this matter, they do not result in full recovery costs for the motion.

Ability to Pay

[28] Ms. Di Raimo says that costs should be reduced because of her inability to pay a significant costs award.

[29] There is good authority for this. In M(C.A.) v. M(D.), (2003) 2003 CanLII 18880 (ON CA), 67 O.R. (3d) 181 (Ont. C.A.), Rosenberg J.A. determined that “any other relevant matter” in Rule 24(12)(b) included determining the ability or inability of a party to pay an award of costs. However, he noted at para. 42 that this is particularly important in the case of a custodial parent only; he stated that the court “cannot ignore the impact of a costs award against a custodial parent that would seriously affect the interests of the child.”

[30] There is some authority for the proposition as well that if a party is impecunious, then he or she must be particularly cautious about litigation. If that party proceeds with litigation, then it is done at that party’s peril; see Balsmeier v Balsmeier, 2016 ONSC 3485 where Kaufman J. states:

I adopt the comments of McGee J. in Mohr v. Sweeney 2016 ONSC 3338, 2016 CarswellOnt 7716, at para. 17, citing Balaban v. Balaban, 2007 CanLII 7990 (Ont. S.C.J.), 2007 CarswellOnt 1518, at para. 7: “[T]hose who can least afford to litigate should be most motivated to seriously pursue settlement, and avoid unnecessary proceedings.”

[31] I do not find that to be relevant to the present case. Ms. Di Raimo was seeking to enforce a clause in a separation agreement giving her primary residence, and under the circumstances, she is not to be blamed for requesting the court to determine the issue of residency of the children. She is impecunious; Mr. Di Raimo acknowledged this in his offer when he agreed to waive child support and there was evidence that she subsists on disability support and she cannot work. Although I have found some element of misconduct, I take the inability of the Respondent to pay the costs into account in setting the amount of costs payable although I note that this is not a sufficient factor to eliminate the award of costs in its entirety: see Snih v. Snih, 2007 CanLII 20774 (Ont. S.C.J.) at pars. 7-13.

Reasonableness and Proportionality

[32] The Applicant is entitled to his costs on a partial recovery basis. The issue then arises as to whether the nearly $14,000 in full recovery costs are warranted for a custody motion argued in an hour.

[33] The hourly rates as set out in the Bill of Costs for Ms. Di Frederico, $325 per hour for a 2005 call, are reasonable and there was no suggestion that they were not.

[34] Ms. Di Frederico spent 37.8 hours in preparing for and arguing the motion, including preparation of materials.

[35] The motion was not a simple custody motion. There were legal issues involved, including the level of deference to be given to the separation agreement which provided for primary care being given to the Respondent. However, I note that I adopted the legal position of the Respondent’s counsel, which included an analysis of the agreement under Miglin v. Miglin, 2003 SCC 24, [2003] 1 S.C.R. 303, in determining that the agreement did not meet the best interests of the children and was therefore not binding on the court. Because this was an analysis under the Divorce Act,[^2] I found that the provisions of the Family Law Act[^3] relied upon by Ms. Di Frederico were not applicable to this analysis.

[36] I also have already noted that Ms. Di Raimo’s unreasonable behaviour, which included a lack of clarity as to her health issues, increased the Applicant’s costs in this matter.

[37] I also note the statement by Wildman J. in Murphy v. Murphy, 2010 ONSC 6204, 2010 CarswellOnt 8616 (S.C.J.) at para. 20 of the report:

I am assuming that the decision to spend so much money preparing for this motion was Mr. Sapir's rather than his counsel's. Regardless of the outcome of the case, a client is not entitled to direct vast resources to litigation and expect full reimbursement. When the rules use the term "full recovery costs", there is an implied qualification that the costs incurred must be reasonable. There must be some assessment of the most effective use of resources to present the case, and some attempt to approach the matter in a cost-effective manner.

[38] In the present case, I find that more than 37 hours spent on this motion to be excessive. I believe that a reasonable number of hours to be spent on this motion, were costs on a full recovery basis, to be 25 hours. This would reduce the claim for costs (excluding HST) to be $8,125. This would mean that full recovery costs inclusive of HST would be $9,181.25. In the normal course, partial recovery costs would therefore be in the amount of about $6,500.

Result

[39] In the normal course, I would have awarded partial recovery costs as set out above. I take into account, however, the fact that Ms. Di Raimo is at a financial disadvantage, and there are legitimate concerns that she would be unable to pay the costs.

[40] I therefore find that Ms. Di Raimo is liable to pay the Applicant his costs for the motion in the amount of $5,000, payable in monthly installments of $412 per month which will result in the repayment of the costs over the next 12 months. Repayment of the monthly instalments shall commence November 1, 2020.

Justice J.P.L. McDermot

Date: October 19, 2020

[^1]: O. Reg. 114/99 [^2]: R.S.C. 1985, c. 3 (2nd Supp.) [^3]: R.S.O. 1990, c. F.3