COURT FILE NO.: FC-14-1959-1
DATE: 2021\04\27
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
DOMINIC GOSSELIN
Applicant
– and –
ANNA SOUKHOVTSEVA
Respondent
Susan E. Galarneau, for the Applicant
Jeffrey Behrendt, for the Respondent
HEARD: In writing
COSTS ENDORSEMENT
M. SMITH J
[1] The parties proceeded to a five-day trial at the end of November 2020 on two issues: custody and the children’s attendance at a Russian school on Saturdays.
[2] On February 9, 2021, I released my decision (Gosselin v. Soukhovtseva, 2021 ONSC 1015), finding that the parties shall have joint custody of the children and that the Russian school on Saturdays is an extracurricular activity. This outcome was in line with the Father’s position.
[3] The Father seeks a cost award in the amount of $123,063.07, while the Mother submits that this would be an appropriate case where each party bears their own costs.
[4] For reasons that follow, I award costs to the Father, in the all-inclusive amount of $60,000.00, payable by the Mother in 24 equal instalments.
POSITION OF THE PARTIES
[5] The Father argues that the Court’s decision was more favourable than his offers to settle.
[6] The Father states that the Mother has acted unreasonably from the outset and she has had an obstructionist attitude. By contrast, the Father has made herculean and timely efforts to resolve the litigation.
[7] It is submitted that, as a result of the Mother’s conduct, there has been unnecessary and protracted litigation. As such, the Mother should pay all the Father’s costs, dating back to November 2016.
[8] The Mother responds that the Father is trying to inappropriately recovery costs for all steps of the litigation, including Court attendances for Case Conferences, Settlement Conferences, Trial Management Conferences, Motions and an Appeal. The Mother says that, unless the judge hearing the matter during the various steps in the litigation reserved the costs to the trial judge, no award of costs should be made.
[9] Further, the Mother states that in the weeks leading up to the trial, she made extensive efforts to settle the case. Her willingness to compromise on most issues led to an extensive settlement, thereby reducing trial time. The Mother’s pursuit of the two remaining issues was made in good faith and out of a genuine love for her children.
THE LEGAL PRINCIPLES
[10] Costs orders are at the discretion of the Court (section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43). The framework in awarding costs is set out at Rule 24 of the Family Law Rules, O. Reg. 114/99 (the “FLR”).
[11] Rule 24(1) of the FLR creates a presumption of costs in favour of the successful party. In setting the amount of costs, the Court shall consider the factors outlined in Rule 24(12) of the FLR, which includes the importance and complexity of the issues, the parties’ behaviour, the time spent, written offers, legal fees, expert witness fees and any other property payable expenses.
[12] Modern costs rules are designed to foster four fundamental purposes: (1) to partially indemnify successful litigants; (2) to encourage settlement, (3) to discourage and sanction inappropriate behaviour by litigants and; (4) to ensure that cases are dealt with justly under subrule 2 (2) of the FLR (Mattina v. Mattina, 2018 ONCA 867).
[13] Proportionality and reasonableness are the touchstone considerations that need to be applied when fixing an amount of costs (Beaver v. Hill, 2018 ONCA 840).
[14] In exercising its discretion, the Court may take into account any written offers to settle, even if the offer does not meet the technical requirements of Rule 18(14) of the FLR (Winiarz v. Anderson, 2020 ONCJ 238).
[15] Where no orders as to costs were made or where there was silence on the issue of costs for steps taking during litigation, any amounts claimed for these matters should be excluded and disallowed (Islam v. Rahman, 2007 ONCA 622).
ANALYSIS AND DISCUSSION
Costs incurred by the Father (November 2016 – September 2019)
[16] The Father was previously represented by Ms. Julie Gravelle. He seeks the recovery of her costs for the period of November 2016 until September 2019. According to my calculations, these total $20,377.03, inclusive of disbursements and H.S.T.
[17] During the time that the Father was represented by Ms. Gravelle, there were several Court appearances which resulted in Court Orders being issued. I note that many of the Court Orders were silent regarding costs, some were reserved to the next conference or to trial and two of them specifically ordered no costs.
[18] Based upon my review of the Court Orders provided to me, I find that there are only two Court attendances where the costs were reserved to the trial judge: Settlement Conference before Justice Shelston on October 16, 2017 and Trial Management Conference before Justice Doyle dated December 2, 2019. However, other than a general statement by the Father that the Mother’s behaviour resulted in having to attend multiple attendances, I have not received any specific submissions from the Father why he feels that these Court attendances would warrant costs.
[19] In adopting the Court of Appeal’s reasoning in Islam v. Rahman, I am not prepared to award costs to the Father for those Court appearances where the issue of cost was silent or where they were not reserved to the trial judge. In respect to the two Court appearances referred to in the preceding paragraph, on the evidentiary record before me, I am unable to conclude that the Father is entitled to any costs.
[20] In sum, I am not prepared to award any costs incurred by the Father for the period of November 2016 to September 2019.
Costs incurred by the Father (September 2019 – December 2020)
[21] For the period of September 2019 to December 2020, the Father seeks the recovery of the costs paid in the amount of $101,587.17, inclusive of disbursements and H.S.T. In carrying out my analysis as to the reasonableness and proportionality of the Father’s request, I have considered the factors set out in the paragraphs that follow.
Conduct
[22] The issues that remained to be resolved at trial were extremely important to the parties. As I mentioned in my trial decision, I do not find that the Mother was pursuing the matter in a malicious manner. Although she was unsuccessful at trial, I accept that she decided to litigate out of a genuine love for her children, believing that it was in their best interest. I am not persuaded that her conduct warrants a higher award of costs.
Success
[23] Despite the Mother’s conviction regarding the issues that proceeded to trial, the Father was the successful party and he is presumptively entitled to some costs.
Time spent and Fees
[24] The Father provided me with Ms. Galarneau’s account for professional services rendered and disbursements incurred for the period from September 2019 to the completion of trial. Three hundred hours of time have been claimed along with disbursements in the amount of approximately $2000.00. The time was shared between Ms. Galarneau, junior counsel and a law clerk at the hourly rates of $375.00, $200.00 and $85.00, respectively. It is estimated that an additional $2,000.00 will have been spent dealing with submissions for costs. I have received no comparable accounts from the Mother’s counsel.
[25] In the circumstances, I find that the account submitted by Ms. Galarneau is reasonable but I believe that it should be discounted to reflect the following: some minor duplication of work as a result of hiring new counsel, court appearances on procedural matters where no costs were ordered and fees incurred in relation to the appeal that was withdrawn by the Father on a without costs basis.
Offers to Settle
[26] As noted in my trial decision, the parties resolved most of the issues before the trial and I congratulate them once again for their efforts. This resolution significantly reduced trial time and the associated legal costs.
[27] I have been provided with the offers to settle that were exchanged between the parties. The offers started in April 2018 and ended on November 25, 2020.
[28] The bulk of the offers to settle began to be exchanged as of October 26, 2020. The Father sent numerous offers to settle on a per issue basis. For example, on October 26, 2020, the Father sent four separate offers to settle in respect to these issues: children’s documents, children’s religion, children’s residency, and non-alienation. This pattern continued until 5 days before trial.
[29] It is worth noting that in February 2020, the Father amended his pleading and asked for an order of sole custody. Since that amendment was made, the Father’s position on custody did not change until sometime in late October 2020.
[30] The Father submits that his last offers to settle (November 12 and 25, 2020) regarding custody and extracurricular activities made it clear that he would be seeking costs on a full indemnity basis for the entire action if his proposal was not accepted by the Mother. The Father’s last offer to settle was sent 5 days before trial. It dealt with the two issues at trial as well as an appeal to the Divisional Court that was going to be abandoned by the Father. I do not find that the Father’s last offer to settle dated November 25, 2020 meets the criteria set out in Rule 18(14) of the FLR or that it warrants an award for full recovery of the Father’s costs. That said, these offers to settle are nonetheless factors to consider.
[31] I am unable to ignore the Mother’s readiness to resolve most of the issues before trial. I am not diminishing the Father’s efforts and participation in achieving this result but when assessing costs against the Mother, I find that this is an important factor that weighs in her favour.
Ability to pay
[32] The Mother argues that the lengthy litigation has seriously compromised her financial situation. In July 2018, she had to sell her house to pay legal fees. She was then self-represented in these proceedings from September 2018 until October 2020 due to financial hardship. The Mother retained counsel for trial and needed to secure a second mortgage at a higher interest rate, in the amount of $109,125.00. She says that a large cost award would cause significant hardship.
[33] The Father submits that there is no evidence before this Court to demonstrate that the funds from this second mortgage were used to finance the litigation or that the Mother has depleted her savings. The Father says that the Mother earns more money than him and suggests that she is the only child of “well to do parents” that own various properties.
[34] I am of the view that the financial means of a party’s parent is not an important factor in the circumstances of this case. What is extremely relevant to me is the fact that the Mother took out a second mortgage at an interest rate of 12%, which is very high in today’s market. In my opinion, this action speaks volumes as to the Mother’s current financial situation.
[35] It is well known that pursuing litigation is expensive, and the Mother was or should have been aware of the risks and the costs involved in proceeding to trial. I am not convinced that the Mother’s financial difficulties are sufficiently dire to warrant an award of no costs. However, I believe that it should be considered when determining the time that will be imposed upon her to satisfy the cost award.
CONCLUSION
[36] In exercising my discretion and considering the factors described above, I find that an award of costs in the amount of $60,000.00, inclusive of disbursements and taxes, is fair, reasonable and proportionate. This represents an award that is at the lower end of the partial indemnity spectrum, which I believe to be appropriate for this case.
[37] In terms of payment, the Mother shall be entitled to satisfy this award of costs by paying it in 24 instalments ($2,500.00 per month), commencing within 30 days of the release of this Costs Endorsement.
Justice Marc Smith
Released: April 27, 2021
COURT FILE NO.: FC-14-1959-1
DATE: 2021\04\27
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
DOMINIC GOSSELIN
Applicant
– and –
ANNA SOUKHOVTSEVA
Respondent
costs endorsement
Justice Marc Smith
Released: April 27, 2021