COURT FILE NO.: FS-19-010274
DATE: 20201027
SUPERIOR COURT OF JUSTICE – ONTARIO
RE: JAKUB KASPERSKI, Applicant
AND:
VALERIE POLITIS, Respondent
BEFORE: C. Horkins J.
COUNSEL: Steven Benmor, for the Applicant
Katharina Janczaruk, for the Respondent
HEARD at Toronto: In Writing
REASONS FOR COSTS DECISION
[1] After a trial in writing with no cross-examination and a brief attendance before the court, the parties cannot agree on the costs.
[2] The applicant father seeks full indemnity costs of $73,208.59 for fees disbursements and HST. The fee component and HST totals $72,178.75. On a partial indemnity scale the amount is $43,822.17.
[3] The applicant says that he is entitled to full indemnity costs because he beat his offer to settle “on all material terms” and the respondent mother’s conduct was unreasonable.
[4] The respondent mother says that no costs should be ordered because success at trial was divided and she has no ability to pay costs. If costs are awarded to the applicant, the respondent argues that the amount he seeks is excessive.
Legal Framework
[5] The Family Law Rules, O. Reg. 114/99 are designed to foster four fundamental purposes: to indemnify successful litigants for the cost of litigation, to encourage settlements, to discourage and sanction inappropriate behaviour by litigants, and to ensure that cases are dealt with justly: Mattina v. Mattina, 2018 ONCA 867.
[6] Pursuant to rule 24(1) there is a presumption that a successful party is entitled to costs. This presumption is subject to the factors in rule 24(12) that the court “shall consider” in “setting the amount of costs” as follows:
(12) In setting the amount of costs, the court shall consider,
(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.
[7] As this rule states, proportionality and reasonableness are the “touchstone considerations” to be applied when fixing the amount of costs: Beaver v. Hill, 2018 ONCA 840 at para. 12.
[8] Finally, the Family Law Rules expressly contemplate that a party shall receive full recovery costs in specific circumstances: when a party has acted in bad faith - rule 24(8) and when a party has beat an offer to settle - rule 18(14).
Divided Success
[9] As stated in my Reasons for Decision (2020 ONSC 5839), the parties settled many of the issues in dispute. Six issues proceeded to trial on affidavit evidence with no cross-examination.
[10] The applicant father was successful on the main issues: choice of school and daycare, imputation of income to the mother and her claim for spousal support. The bulk of the evidence was dedicated to these issues and they consumed most of the time incurred by the parties.
[11] The respondent mother was successful on the equalization issue, but this involved one very narrow issue; whether the father owed a debt to his parents. But for this question, the parties settled equalization before trial.
[12] The remaining issue involved some minor miscellaneous parenting plan disputes and success was divided.
[13] The father’s success at trial was far greater than the mother’s success.
The Mother Behaviour was Unreasonable
[14] A party’s behaviour is a factor the court shall consider in setting the amount of costs (Family Law Rule 24 (12) (a) (i)).
[15] In deciding if a party has acted unreasonably, Family Law Rule 24(5) requires the court to examine the party’s behaviour 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.
[16] The mother’s behaviour was unreasonable on the main issues: choice of school/daycare and imputation of income/spousal support. I rely on the facts as set out in my reasons, as summarized below.
[17] The mother’s behaviour directly contributed to the expense and duration of the litigation and forced the dispute to a trial. She failed to comply with the September 2019 agreement that obligated the parties to evaluate and discuss the child’s options for kindergarten and daycare in September 2020. The father complied with this agreement and the mother did not. The mother ignored the father’s repeated requests to discuss the child’s school and daycare for September 2020. The father’s attempts to engage the mother in the choice of school and daycare went on for months. He sent her detailed emails with information about the school and daycare he proposed. She never responded. His counsel tried without success to obtain a reply from the mother’s counsel. I rejected the mother’s explanation for not complying with the September agreement. I found that she did not propose an alternative to the father’s choice of school until she filed her trial affidavit.
[18] The father’s August 4, 2020 offer to settle included his choice of school (Wilkinson Public School). While his offer does not mention the daycare associated with the school, the mother knew what daycare he was proposing. The mother did not serve an offer to settle.
[19] Turning the spousal support claim, the respondent behaved unreasonably in her pursuit of this claim. She pursued a spousal support claim through trial and never produced any income tax returns, notices of assessment or any documents to show the minimal income she claimed to have earned. The father offered detailed evidence about what the mother had historically earned and could earn. This formed the evidentiary foundation for the imputation of income to the mother. The mother did not respond to the father’s evidence in her affidavit. The father’s August offer to settle proposed that no spousal support be paid to either party. The mother never served an offer to settle.
[20] It was unreasonable for the mother to push the spousal support issue through trial without her basic income information, while ignoring the father’s evidence and offer to settle.
The Father’s Offer to Settle
[21] The father says that he beat his August 4, 2020 offer to settle and therefore it triggers full recovery costs from the offer to settle forward. The offer was not severable and so the father did not “beat” his offer because he was not successful on the equalization loan issue.
[22] I accept that the offer to settle is a factor to consider. It shows that the father was acting reasonably in his efforts to settle the case, but the offer does not trigger full recovery costs.
Quantum of Costs
[23] The father succeeded on the main issues at trial and is entitled to reasonable costs. I reject the mother’s submission that she has no ability to pay costs. She can work and an income of $50,000 has been imputed to her.
[24] The fees in the father’s Bill of Costs total $63,875. On the facts of this case, this is excessive. The parties settled custody and parenting time. There were no motions and no questioning before trial. The evidence at trial was submitted by affidavit and each party filed 2 affidavits. There was no cross-examination. The issues were not complicated or complex.
[25] There are several reasons to question applicant counsel’s Bill of Costs.
[26] The Bill of Costs includes $2655 to research the law for a “Factum of Law” and $1475 to prepare a “Factum of Law”. Counsel for the father filed a two-page submission with no case law and no review of the evidence. It was not helpful. The main focus of this two-page submission was the delay in moving the litigation ahead and the father’s inability to afford ongoing litigation.
[27] The Bill of Costs includes $1,475 for “opening submissions” and yet this was a trial in writing and no submissions were provided. The “attendance” before the court was limited to answering a few clarification questions from the court.
[28] The parties each filed two affidavits and yet the Bill of Costs notes one affidavit.
[29] The Bill of Costs includes $29,500 in fees for written and oral communications with the client and opposing counsel. This is excessive given the issues. Many of the written communications between counsel were attached to the applicant’s trial affidavit and do not support this level of time and fees. For the most part, counsel’s letters simply urged the respondent to reply. At a minimum, this should be reduced by 50% to $14,750
[30] The Bill of Costs includes fees for three case conferences. For the July 15, 2019 case conference, fees of $5,310 are claimed. On this occasion, the parties signed Minutes of Settlement agreeing to a parenting schedule. They also agreed that each party was responsible for their own legal fees. As a result, fees for this case conference should not be part of the Bill of Costs.
[31] The Bill of Costs seeks $5,310 for a case conference before Justice Nakonechny. The endorsement states “No costs of today”. As a result, fees for this case conference should not be part of the Bill of Costs.
[32] A final conference was held before Justice Boucher on July 27, 2020 and, on that attendance, an order was made directing the trial in question. The endorsement does not deal with costs. The amount of $4,130 (full recovery) is requested. I accept that costs of this attendance should form part of the Bill of Costs.
[33] When the above is considered the full recovery fees should be reduced by $30,975 to a total of $32,900.
[34] The disbursements are not itemized but are nominal: $514.92.
[35] The applicant is entitled to partial indemnity costs given the degree of his success and the respondent’s unreasonable behaviour. I fix the applicant’s costs at $20,000 all inclusive. This amount is reasonable and fairly reflects the four fundamental purposes of a cost order. I order the respondent to pay the applicant costs of $20,000 in full satisfaction of all fees, disbursements and HST.
C. Horkins J.
Date: October 27, 2020