Superior Court of Justice - Ontario

COURT FILE NO.: FS-15-20422 DATE: 2020-11-12

RE: A.A., Applicant AND: R.R., Respondent

BEFORE: M. Kraft, J.

COUNSEL: Reginald M. McLean, for the Applicant Chad D. Rawn, for the Respondent

HEARD: In writing

COSTS ENDORSEMENT

[1] This is the costs endorsement in respect of the respondent’s motion seeking an order preventing the applicant from sending the parties’ child to school at Elizabeth Simcoe P.S. commencing September 2020, pending the completion of an arbitration. The respondent’s position was that the applicant breached the consent order of Kristjanson, J., dated May 29, 2019, in making a decision to send the child to school, since the school placement of the child for the 2020-2021 academic year is the subject of an arbitrations scheduled to take place at the end of October 2020. The applicant denies that she breached any court orders in enrolling the child in the Elizabeth Simcoe P.S. pending the completion of the arbitration. The applicant took the position that the motion was a dispute over the interpretation of existing Court orders, as she was simply following the order of Nakonechny, J., dated February 28, 2020, when she enrolled the child in the school pending the outcome of the arbitration.

[2] On September 30, 2020 (“the September 30^th Order”), I ordered that on a temporary “without prejudice” basis, pending the outcome of the arbitration:

a. the child was to attend senior kindergarten at Elizabeth Simcoe P.S. on the days she is scheduled to reside with the applicant;

b. the respondent could enroll the child in a school of his choosing on the days that she is scheduled to reside with him;

c. the child was to reside with the parties as per the school schedule set out in the order of Kristjanson, J., dated May 29, 2020, not as per the alternating weekly schedule set out in the Order of Faieta, J., dated April 16, 2020, (which was in place from the onset of the Covid-19 lockdown and throughout the summer) which the respondent proposed; and

d. neither party was to plead or argue the issue of the status quo of the child’s present school(s) before the arbitrator so that the school issue was to proceed de novo.

[3] The applicant is seeking costs. The respondent seeks an order that no costs be paid by or to either party. He submits that he is appealing my Order, dated September 30^th, 2020, to the Divisional Court on the basis that I misapprehended the evidence that was before me on the motion. The respondent’s appeal is a matter to be determined by an appellate court. In determining the costs issue below in this Endorsement, I have not considered the merits of the respondent’s appeal. For clarity, in determining the applicant’s claim for costs, I have considered the relief that the respondent requested on his motion; the extent to which the applicant was successful in her response to the motion; the reasonableness or unreasonableness of a party’s behaviour, where directed to do so under Family Law Rule 24 and whether the applicant had acted reasonably or unreasonably, having regard to the direction that Family Law Rule 24(5) provides to a judge considering whether a party has behaved reasonably or unreasonably, and whether she had acted in bad faith. Upon determining that the applicant is entitled to an order for costs, in setting the amount of costs that the respondent should pay to the applicant, I considered the costs principals referred to below, including but not limited to the specific factors contained in Family Law Rule 24(12), as required.

[4] The two central issues on the motion were 1) whether the child was to continue to attend kindergarten at the Elizabeth Simcoe P.S. pending the outcome of the arbitration, which, in turn, relates to whether the applicant breached an existing court order; and 2) whether the child was to reside with the parties on an equal alternating weekly schedule, namely, the holiday schedule ordered by Faieta, J. on April 16, 2020, as proposed by the respondent or the regular residency schedule, as set out in the consent order of Kristjanson, dated May 29, 2019.

[5] In my view the applicant was largely successful on this motion and is, therefore, presumptively entitled to costs pursuant to Rule 24(1) of the Family Law Rules, O. Reg. 114/99 (“FLRs”).

Legislative framework

[6] Subject to the provisions of an Act or the rules of court, costs are in the discretion of the court, pursuant to s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43.

[7] Pursuant to r. 24(10)(a) of the FLRs, the court is directed to decide the costs of a step in the case promptly after dealing with the step, in a summary manner.

[8] Modern family costs rules 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, 299 A.C.W.S. (3d) 770, at para. 10. The touchstone considerations of costs awards are proportionality and reasonableness: Beaver v. Hill, 2018 ONCA 840, 17 R.F.L. (8th) 147, at para. 12.

[9] The factors to consider in setting the amount of costs are listed in r. 24(12). The court must consider the reasonableness and proportionality of the factors enumerated in the sub rules as they relate to the importance and complexity of the issues. These factors include each party’s behaviour; the time spent by each party; any written offers to settle, including those that do not meet the requirements of r. 18; any legal fees; any other expenses; and any other relevant matter.

[10] In Sims-Howarth v Bilcliffe, 2000 CanLII 22584 (ON SC), [2000] O.J. No. 330 (S.C.J.), Aston J. held that the two traditional scales of costs are no longer an appropriate way to quantify costs under the FLRs. He stated that, having determined that one party is liable to pay costs, the court must fix the amount at some figure between a nominal sum and full recovery, having regard to the factors set out in Rule 24, without any assumptions about categories of costs. This characterization of costs under the FLRs was approved of by the Ontario Court of Appeal in C.A.M. v D.M., 2003 CanLII 18880 (ON CA), [2003] O.J. No. 3707 (C.A.), at para. 42.

[11] The FLRs do not explicitly provide for costs on either a partial or substantial indemnity scale. Rule 24(8) refers to “costs on a full recovery basis,” where a party has acted in bad faith. The husband is effectively seeking costs approaching full recovery. In a family law case, the court need not find “special circumstances” before ordering costs on a full recovery basis, see Sordi v. Sordi, 2011 ONCA 665, 283 O.A.C. 287. The Court has a range of costs awards open to it, from nominal to just short of full recovery.

[12] There is no general approach in family law of “close to full recovery costs”: Beaver, at para. 11. Rather, full recovery is only warranted in certain circumstances, such as bad faith under r. 24(8), or beating an offer to settle under r. 18(14): Beaver, at para. 13.

[13] Costs must always be proportional to what is at stake in the case, and to the unsuccessful party’s reasonable expectation as to what costs he/she may face, if he/she is unsuccessful. In appropriate circumstances, unreasonable behavior will result in a higher award of costs.

Factors to be considered

[14] The applicant seeks costs on a partial indemnity basis in the amount of $3,012,50, inclusive of HST and disbursements.

[15] I have considered the factors set out in Rule 24 (12) of the FLRs, which reads as follows:

24(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. O. Reg. 298/18, s.14.

[16] The respondent’s position is that the Court ought to order no costs of this motion. He takes this position on the basis that there was divided success of the parties and the applicant’s conduct was “inherently unreasonable in having brought the matter to court knowing that the situation was not at all the same before Nakonechny, J., as it was before Kraft, J.” (see paragraph 22 of the applicant’s costs submissions).

[17] The respondent’s position on the motion was that the applicant had made a unilateral decision to register the child at Elizabeth Simcoe P.S., contrary to the Order of Kristjanson, J., which requires the parties to make education-related decision jointly. In support of his position that the applicant had behaved unreasonably in this case, the respondent relies on the fact that, I stated in paragraph 38 of my order that I did not agree with the applicant’s approach in dealing with the child’s enrolment in school and stated that she ought to have clearly told the respondent that she intended to put the child in the school in which she was enrolled last year pending the arbitration. For clarity, these comments in my September 30^th Order, were made in relation to the fact that the applicant was first asked by the respondent to address the issue of the child’s school for September on August 7, 2020, and she did not respond until August 24, 2020.

[18] The respondent further submits that the applicant’s bill of costs ought to be reduced since 2/3 of her affidavit was unrelated to the motion before the Court. Finally, the respondent submits that “partial indemnity” costs, as a rough estimate, are to be 60% of “full indemnity” costs. The applicant’s actual costs were $3,869.37 (inclusive of fees, disbursements and HST). The respondent submits that the applicant is seeking $3,000, inclusive of fees, disbursements and HST, which is in excess of 60%.

Who was Successful on the Motion?

[19] The applicant was successful on both the issues of the school the child was to attend, pending the outcome of the arbitration, and the parenting schedule that ought to be in place, pending the outcome of the arbitration. She is presumptively entitled to costs.

Importance, complexity, and difficulty

[20] The parenting schedule and the child’s school placement were scheduled to be arbitrated at the end of October 2020. The motion was of importance to both parties. In particular, the respondent brought the motion seeking a finding that the applicant had breached another court order and allowing him to enjoy a parenting schedule that provided him with equal time with the child, pending the arbitration. It was also an important matter for the applicant, who believed that the child should start the school year attending school between the commencement of the school year and the determination of the arbitration. It made sense that the child simply continue at the school she had attended until the prior school year ended. The respondent wanted the child to stay at home until the outcome of the arbitration became known or attend the school of his choice in person until the outcome of the arbitration was known.

[21] The motion was not overly complex, in that it essentially involved a consideration of the steps and orders that had been made in this case in relation to the parties’ sharing of the child’s time and the school that the child was to attend.

Each Party’s Behaviour

[22] Rule 24(4) of the FLRs explicitly authorizes the use of costs orders to express the court’s disapproval of a litigant’s unreasonable conduct. It provides as follows:

24(4) Despite sub-rule (1) [which provides that a successful party is presumed to be entitled to the costs of a motion], 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.

[23] Further, Rule 24(5) provides criteria for determining the reasonableness of a party's behaviour. It provides as follows:

DECISION ON REASONABLENESS

(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.

[24] Further, r.24(12)(a)(i) requires the court to consider each party’s behaviour in setting the amount of costs.

[25] The respondent submits that the applicant should not receive any costs on the ground that she acted in bad faith by not responding to his requests to understand her position about the child’s school, which, again, he inquired about at the beginning of August and to which the applicant did not respond until August 24, 2020. I agree with the respondent that the applicant ought to have responded to his inquiries earlier. In my view, she had to have known that not receiving a response from her would have added unnecessary stress and possibly aggravate the situation. However, in considering the evidence on the motion as a whole, I am satisfied that the applicant was not acting in bad faith when she did not respond as quickly as she should have to the respondent’s inquiries

[26] For clarity, I took the unreasonableness of the applicant’s behaviour in not responding to the respondent’s inquiries in a timely way into account when determining whether to order costs and also in fixing the amount of costs I have ordered. The impact of that one instance of unreasonable conduct is not significant, in my view. In my opinion, it is unlikely that an earlier response to the respondent by the applicant would have changed the trajectory of this motion.

[27] In considering each party’s behaviour, the applicant’s failure to respond to the respondent’s requests to discuss her intentions for the child for school undoubtedly caused the applicant additional stress and can perhaps be seen to have been unreasonable, it could not be said on the evidence before me that had she advised him of her intentions earlier, the motion would have been avoided.

Offers to Settle

[28] Neither party made a formal offer to settle the respondent’s motion. However, counsel for the applicant wrote a letter to the respondent’s counsel dated August 24, 2020, in which he set out that (a) his interpretation of the Order of Faieta, J., dated April 16, 2020, was that the parenting schedule was not to remain on the week on/week off schedule, but revert to the regular residency schedule once the school year commenced; and (b) the respondent was free to enroll the child and have her attend a school of his choosing near his home on the Thursdays and Fridays when the child was scheduled to reside with him, pending the arbitration. This, in effect, would be consistent with the order I made.

Time properly spent on the case and any legal fees, including the number of lawyers and their rates, etc.

[29] Again, in Sims-Howarth v Bilcliffe, 2000 CanLII 22584 (ON SC), [2000] O.J. No. 330 (S.C.J.), Aston J. held that the two traditional scales of costs are no longer an appropriate way to quantify costs under the FLRs. He stated that, having determined that one party is liable to pay costs, the court must fix the amount at some figure between a nominal sum and full recovery, having regard to the factors set out in Rule 24, without any assumptions about categories of costs. This characterization of costs under the FLRs was approved by the Ontario Court of Appeal in C.A.M. v D.M., 2003 CanLII 18880 (ON CA), [2003] O.J. No. 3707 (C.A.), at para. 42.

[30] Again, the FLRs do not explicitly provide for costs on either a partial or substantial indemnity scale. Rule 24(8) refers to “costs on a full recovery basis,” where a party has acted in bad faith. In a family law case, the court need not find “special circumstances” before ordering costs on a full recovery basis: Sordi v. Sordi, 2011 ONCA 665, 283 O.A.C. 287. The Court has a range of costs open to it, from nominal to just short of full recovery. However, as stated in paragraph [11] above, there is no general approach in family law “close to full recovery”; rather receiving full recovery is only warranted in the circumstances referred to in paragraph [11].

[31] Costs must always be proportional to what is at stake in the case, and to the unsuccessful party’s reasonable expectation as to what costs he may face if he is unsuccessful.

Lawyer’s rates

[32] The applicant’s lawyer, Mr. McLean, has been in practice for 40 years. His hourly rate is $375.00.

Time properly spent on the case

[33] Mr. McLean spent 9.1 hours on this matter between August 22, 2020 and September 30, 2020. This time spent by the applicant to respond to the motion was entirely reasonable and proportionate to the issue raised by the respondent on his motion. They were also proportional to what was at stake and the respondent’s reasonable expectation as to what costs he might face, if he was unsuccessful on the motion. Particularly given that the respondent did not challenge any of the fees charged for work performed, I accept the record of time set out in the applicant’s Bill of Costs.

Disbursements

[34] The applicant claims $13.84 for disbursements, inclusive of H.S.T. and taxes relating to photocopying. I find the disbursements to be reasonable.

CONCLUSION AND ORDER

[35] In light of the extent of the applicant’s success on the motion; the reasonableness and proportionality of the work performed by the applicant’s counsel; the fact that the respondent should have expected to pay costs, if the applicant both succeeded in obtaining a temporary order that the child continue to attend Elizabeth Simcoe P.S. and the parties revert to the regular residency schedule pending the outcome of the arbitration; the applicant’s clear success on the issues of the school placement and the parenting schedule; but also considering that the order should to a degree recognize that the applicant acted unreasonably when she did not respond to the respondent in a timely way, an order that the respondent pay approximately 70% of the applicant’s costs which represents a reasonable and fair contribution to the costs she incurred on the motion, inclusive of fees, disbursements and HST, or $2,708.98 ($3,869.97 X 70%), inclusive of fees, disbursements and HST.

[36] Accordingly, this Court orders that A.A. shall pay costs of the motion to R.R. in the amount of $2,708.98, inclusive of fees, disbursements and HST.

M. Kraft, J.

Date Released: November 12, 2020