Court File and Parties
COURT FILE NO.: 54328-19 DATE: 2021/02/16 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Darcy Bourke, Applicant AND: Jennifer Davis, Respondent
BEFORE: Mr. Justice D.A. Broad
COUNSEL: Emily Carroll, Counsel for the Applicant Richard Noll, Counsel for the Respondent
Costs Endorsement
[1] The parties have been unable to settle the question of costs and have each delivered written submissions in that respect.
[2] I am aware that the appeal of the trial decision has been heard by the Court of Appeal, evidently on an expedited basis, and is currently under reserve. No request has been made of me to withhold making a ruling on the costs of the proceeding pending the disposition of the appeal. I see no reason to depart from the requirement in rule 24(10) of the Family Law Rules that the costs determination be made promptly.
Position of the Respondent
[3] The respondent says that she was the successful party pursuant to the trial decision and as such is presumptively entitled to costs pursuant to rule 24(1) of the Family Law Rules.
[4] The respondent submits that she should be awarded costs on a partial indemnity basis, at the very least, in the sum of $37,161.04 comprised of fees in the sum of $30,840, HST thereon in the sum of $4,009.20, disbursements in the sum of $2,045.88 and HST on assessable disbursements in the sum of $265.96 for a total of $37,161.04.
[5] The respondent pointed to her Offer to Settle dated March 10, 2020 (the “respondent’s Offer”) which provided the applicant with more overnight visits with the children than did the final decision of the court.
[6] The respondent’s Offer provided for her to have sole custody of the children with an obligation to consult with the applicant in writing with respect to any major educational, medical or religious decisions affecting the children, with final decision-making to the respondent in the event that the parties are unable to reach agreement. The respondent’s Offer provided that the respondent would be permitted to relocate with the children to Washington State and for generous and liberal access to the children by the applicant in Ontario, as detailed in the Offer.
[7] The respondent submits that the court’s judgment in general was as or more favourable to her on all of the issues than the respondent’s Offer and relies upon rule 18(14) of the Family Law Rules.
Position of the Applicant
[8] The applicant submits that there should be no order as to costs. While she was not the successful party, she litigated the issues in good faith as an involved and loving parent on the basis of her genuine belief that it would be in the children’s best interest to remain in Ontario while maintaining the maximum contact with both parents. She submits that the court should not recognize either party as a “winner” or “loser” given that the primary issue at stake was mobility. Moreover, she submits that the court should consider the extraordinary travel costs she will have to incur in order to maintain her relationship with the children.
[9] In the alternative, the applicant submits that if any costs are awarded, they should be minimal and mitigated by her travelling costs and her need to maintain a relationship with the children.
Guiding Principles Respecting Costs
[10] Section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43, as amended, provides that "subject to the provisions of an Act or rules of court, the costs of and incidental to a proceeding or a step in a proceeding are in the discretion of the court, and the court may determine by whom and to what extent the costs shall be paid."
[11] Pursuant to subrule 24(1) of the Family Law Rules, the successful party is presumed to be entitled to recover costs. Subrule 24(11) requires the court, in setting the amount of costs, to consider a number of factors including the importance, complexity and difficulty of the issues, the reasonableness or unreasonableness of each party's behavior in the case, the lawyer's rates, the time properly spent on the case, expenses properly paid or payable, and any other relevant matter. These factors are to be applied flexibly (see M. (C.A.) v. M. (D.) (2003), 67 O.R. (3d) 181 (Ont. C.A.) at para 42).
[12] Consideration of the relative success of the parties on the issues in the case is the starting point in determining costs (see Butty v. Butty, [2009] O.J. No. 1887 (Ont. S.C.J.) at para. 4, citing Sims-Howarth v. Bilcliffe, [2000] O.J. No. 330 (Ont. S.C.J.)). In the case of Johanns v. Fulford, 2010 ONCJ 756 (Ont. C.J.) at para. 13, it was held that, for the purpose of rule 24(1), "success" is assessed by comparing the terms of an order against the relief originally requested in the pleadings and against the terms of any offers to settle.
[13] In M. (C.A.) v. M. (D.) the Court of Appeal confirmed, at paras. 40-42, that:
(a) although the Family Law Rules have circumscribed the broad discretion granted by s. 131(1) of the Courts of Justice Act they have not completely removed the trial judge's discretion; (b) although the general provision, rule 24(1), enacts a "presumption" that the successful party is entitled to costs of the case it does not require that the successful party is always entitled to costs; (c) a successful party may not obtain a costs award in his or her favour even in circumstances not falling within subrule 24(4); (d) there may be circumstances aside from the unreasonableness of the successful party's conduct that rebut the presumption; and (e) the financial situation of the parties can be taken into account in setting the amount of the costs award either under rule 24 or Rule 18 pursuant to the direction in subrule 24(11) that the court take into account "any other relevant matter".
[14] The Court of Appeal has observed that modern costs rules are designed to foster three fundamental purposes: (1) to indemnify successful litigants for the cost of litigation; (2) to encourage settlements; and (3) to discourage and sanction inappropriate behavior by litigants (see Fong v. Chan, [1999] O.J. No. 3707 (Ont. C.A.) at para. 24).
[15] While the case law requires the Court to consider the means of the parties, the limited financial resources of a party do not necessarily afford immunity from a costs order, but may affect the scale or quantum of costs (see Parsons v. Parsons (2002), 31 R.F.L. (5th) 373 (Ont. S.C.J.) at para. 12).
[16] Importantly, the case law directs that a costs award must represent a fair and reasonable amount that should be paid, rather than an exact measure of the actual costs, must be consistent with what the unsuccessful party might reasonably have expected to pay, and must reflect some form of proportionality to the actual issues argued, rather than an unquestioned reliance on billable hours and documents created (see Mason v. Smissen, [2013] O.J. No. 4229 (Ont. S.C.J.) at paras. 5 and 6 and the cases therein referred to).
Discussion
[17] As identified in the Reasons for Judgment the predominant issue was that of mobility. Given what is at stake, mobility cases do not lend themselves readily to compromise leading to settlement. This factor was magnified in the case at bar given the distance from Southern Ontario that the respondent proposed to move with the children.
[18] It is recognized that the applicant and the respondent are each capable and loving parents and were each sincerely motivated to seek an outcome they believed would be in their children’s best interests. The case was of great importance to both parties. Both parties behaved reasonably in the conduct of the proceeding, and as found in the Reasons, they demonstrated an ability to communicate and cooperate to a large extent in providing for the care and well-being of the children which supported the finding that the parties should share joint custody.
[19] The applicant points to the case of Reid v. Mulder, [2006] O.J. No. 1273 (S.C.J.), which was a mobility case, in which both parties were found to have litigated their custody issue in good faith as result of their genuine love for their daughter in a mutual desire to play a significant role in her life. Reilly, J. found at para. 10 that recognizing one party as the “winner” and designating the other as the loser” by an award of costs was unjust and unconscionable in the circumstances of the case.
[20] Reid v. Mulder was considered in the case of Reati v. Racz, 2016 ONSC 3769 (S.C.J.), also a mobility case, after it was cited by counsel for the proposition that “courts have displayed a reluctance to award significant costs in mobility cases, and that the courts have found that the presumption in r. 24(1) should not apply in a mobility case” (see para. 8).
[21] Mitrow, J. observed at para. 9 of that “while I do agree that a court, in appropriate circumstances, can exercise its discretion to decline an award of costs to a successful party, such a result will be dependent largely on the specific facts.”
[22] At para. 10 Mitrow, J. pointed to the Court of Appeal decision in Bjornson v. Creighton, 2002 CarswellOnt 3866 (C.A.) where mobility was the main issue and where appeal costs of $23,000 were awarded to the mother who successfully appealed a trial decision preventing her from relocating with the child.
[23] Reid has been referred to in five subsequent cases. Only one of them resulted in an order that each party bear their own costs, namely the case of Basley v. Basley, 2017 ONSC 886 (S.C.J.) which was cited by the applicant in the case at bar.
[24] The factual context in Basley is important to consider. At para. 12 Vogelsang, J. stated as follows:
In the matter before me, I was absolutely convinced of the sincerity of each of the parties and their strong belief that the children who they love so much would be better served by the proposal each put before the court. In the result, however, I decided that the children are to be with them on an equally-shared rotation, which will require a very significant financial and parental contribution from each of them. I doubt that Ms. Basley could maintain that contribution if a costs award were imposed on her, as her economic circumstances are far less than those enjoyed by Mr. Basley. At that point, the children would, in all probability, suffer. I have compared the circumstances of the parties and, as a principle, costs should sometimes not be awarded where a delicate balance sought to be achieved by an order with respect to ancillary relief would be upset: Tysoe v. Huxley (2006), 2006 BCCA 149, 25 R.F.L. (6th) 280 (B.C. C.A.).
[25] Reid does not appear to have been applied in support of the broad proposition that costs should generally not be awarded in mobility cases given their nature.
[26] The applicant also referred to the costs decision in Van Rassel v. Van Rassel, 2008 CarswellOnt 7309 (S.C.J.) in which Mossip, J. made reference to the following passage at the outset of her trial decision:
There is no other area of family law litigation in which the idea of "winner" and "loser" is less applicable than that of mobility cases. It is also true, that even with the very best parents, it is the area where "win-win" solutions can rarely, if ever, be fashioned. Parents involved in a mobility dispute often have to resort to the courts, because even with the best of intentions, and with both parties doing their best to put their child's interest before their own, they cannot find a solution to the desire of one parent to move with the child, and the other parent vehemently resisting that move.
[27] Nevertheless, Mossip, J. found that the mother who unsuccessfully sought to move with the child to Halifax should pay costs to the father, observing at para. 10 that:
although she was entitled to bring her Application, ultimately I found her position unrealistic and not in [the child’s] best interests. She must have known this litigation would be very expensive for both parties and she knowingly took the risk of her application being dismissed. There was always a risk she would have to pay some costs if her application was unsuccessful, and I am certain she knew that.
[28] The applicant also referred to the case of Cannon v. Cannon, 2017 BCSC 1462 (B.C.S.C.), a mobility case, in which Marchard, J. concluded his reasons for decision at para. 81 “if the parties wish to speak to costs, they must contact Supreme Court Scheduling within 30 days, failing which, given the importance of the issues, there will be no order as to costs.” I do not find this brief reference to be instructive on the costs principles to be applied to the case at bar.
[29] Similarly, the in case of Buch v. Buch, 2017 ONSC 6246 (S.C.J.), cited by the applicant, Sloan, J. dealt with the question of costs very briefly, stating “for the above reasons and discussions I dismiss the applicant's application to move [the child’s] residence from Simcoe to Exeter without costs.” It appears that this disposition on costs was made in the context of the particular circumstances of the case and there is little of general application to be derived from the Buch case which would be of assistance in the case at bar.
[30] In my view, there is no principle of general application that costs should not be awarded in mobility cases. In my view the same guiding principles to which I have referred to apply in mobility cases, including the principle that in particular circumstances the court retains a discretion to deny an award of costs to a successful party, even in the absence of unreasonable conduct by that party.
[31] In my view, the presumption that the respondent, being the successful party on the predominant issue at trial, should be entitled to costs has not been rebutted. Each party served an Offer to Settle which essentially reflected their respective positions at trial. I find that the position taken by respondent in her Offer to Settle and in her evidence and submissions at trial was child-focused and sought to maximize, to the extent possible, the children’s time with the applicant. As such, I find that she was focused on settlement within the confines of the mobility issue, which as indicated, is generally less amenable to compromise than other issues in family law.
[32] The question to be determined is therefore the quantum of costs to be awarded to the respondent.
[33] The applicant did not take issue with the Bills of Costs submitted by the respondent with respect to the counsel time or the hourly rates claimed or with respect to the disbursement recovery sought. The applicant did not submit her own Bill of Costs or Costs Outline for comparison purposes or to offer insight on her reasonable expectations with respect to costs.
[34] The applicant submits that, although she was relieved of an obligation to pay child support and s. 7 expenses to account for the cost of exercising access to the children, her travel expense will still be significantly more than the off-setting savings in child support. She says that a significant award of costs against her will severely impact her ability to exercise parenting time with the children.
[35] I find that I have jurisdiction to take into account the cost of exercising access in determining the quantum of costs pursuant to subrule 24(12)(b) as “any other relevant matter.”
[36] Pursuant to the Federal Child Support Guidelines the quantum of child support that would be otherwise payable, based upon the applicant’s annual income of $79,300 is $1,200 per month or $14,400 per year. This does not take into account the contribution that the applicant would otherwise make towards s. 7 expenses for the children.
[37] Unfortunately, there was little evidence led at trial on what a reasonable annual budget would be for travel expenses for the applicant to exercise the access which has been ordered. I am able to assume that the annual travel costs will not be completely offset by the savings in child support and s. 7 expenses. The magnitude of the differential is unknown.
[38] Taking into consideration the significant travel expenses that would be incurred by the applicant to exercise access and the associated hardship to the applicant, a fair award of costs in favour of the respondent would be $22,760 all inclusive, representing a deduction from the amount claimed of one additional full year of child support in the sum of $14,400.
Disposition
[39] On the basis of the forgoing, it is ordered that the applicant pay costs to the respondent fixed in the sum of $22,760. This amount shall be paid within 30 days hereof.
D.A. Broad, J. Date: February 16, 2021