Court File No.: 16-772
Date: 2021-09-27
Superior Court of Justice - Ontario
Re: Amanda Proulx, Applicant
And:
Robert Proulx, Respondent
Before: Somji J.
Counsel: Jeremy Dolgin for the Applicant Peter Liston for the Respondent
Heard: In Writing
Costs Endorsement
Overview
[1] The parties proceeded to a four-day trial on issues of decision-making responsibility, primary residence, parenting time, child support, and division of property. I rendered a decision and indicated the father was the successful party: Proulx v. Proulx, 2021 ONSC 3657. The father requests substantial indemnity costs in the amount of $54,000.
[2] The mother argues that costs should be limited to a maximum of $1,000 because she was successful on some issues, made an offer to settle, acted reasonably, and has limited ability to pay. The mother also asks that her costs for addressing financial issues in the amount of $10,000 plus HST be set off against any costs ordered against the father.
[3] The issues to be decided are:
Is the father entitled to costs despite the mother’s success on some issues?
If so, what constitutes a reasonable award of costs?
[4] All references to rules are to the Family Law Rules, O. Reg. 114/99 unless otherwise stated.
Issue 1: Is the father entitled to costs despite the mother’s success on some issues?
[5] The court has the discretion to determine to whom costs should be awarded and in what amount: Section 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43.
[6] Rule 24 sets out the legal framework for cost orders in family cases: Mattina v. Mattina, 2018 ONCA 867, at para 9.
[7] The starting point is that the successful party is presumptively entitled to costs: r. 24(1). However, in awarding costs judges must also consider the following:
written offers to settle: rr. 18(14) and 24(12)(a)(iii);
any unreasonable conduct on the part of a successful party: r. 24(4); and
if a party has acted in bad faith: r. 24(8).
Successful party
[8] The father claims that he was successful on all issues. The mother disagrees. She claims that she was successful on the issue of primary residence given that I ruled the child’s residence should remain in Renfrew with her. The father had requested the child be moved to Ottawa with the parties having equal parenting time whereas the mother had requested primary residence in Renfrew with parenting time at the discretion of the court. The mother argues that the fact that I would have ordered 50/50 time had the father lived closer is immaterial to the issue of “success” at trial when it relates to costs. Counsel relies by analogy on the case of Fyfe v. Jouppien, 2012 ONSC 97, 10 R.F.L. (7th) 371. I find the case of minimal relevance to the arguments regarding success and entitlement, but find it relevant to the issue of the ability to pay which is considered further.
[9] What the mother’s argument fails to address is that while I ruled that it was in the best interests of the child to maintain primary residence in Renfrew where he has lived and attended school all his life, this decision and outcome was largely due to the status quo created by the mother’s conduct following the separation five years ago which resulted in the unnecessary alienation of the father’s parental rights: Proulx at paras 68-93. I need not repeat my ruling in this regard, but the mother’s unwillingness to have the father reside in the vacant matrimonial home and continue shared parenting was a significant factor in creating the status quo in her favour. To compensate for the fact that a 50/50 parenting schedule would impose a significant travel burden on the child and would not be in his best interests, I increased the father’s parenting time significantly from what he has received since separation by providing parenting time every weekend and considerably more summer and other holidays throughout the year.
[10] The mother also requested sole decision-making responsibility claiming she had de facto decision-making since separation. For similar reasons, I found that this status quo should not be maintained given it was created by a sequence of events over which the father had little control. The father was awarded joint-decision-making as requested.
[11] For these reasons, I find that while the father did not succeed in obtaining an order for primary residency, he was the successful party with respect to the parenting issues.
Offers to settle
[12] Offers to settle are important and can be a yard stick to measure success. They are significant in determining both liability for costs and quantum: Osmar v. Osmar (2000), 2000 20380 (ON SC), 8 R.F.L. (5th) 387 (Ont. S.C.), at para 7; Lawson v. Lawson, 2008 23496 (Ont. S.C.), at para 7.
[13] The mother claims the court’s decision with respect to parenting was much closer to her offer to settle than the father’s position. I disagree. Other than primary residence discussed above, the court’s decision was far more favorable than the mother’s offer. The mother offered sole decision-making whereas the court ordered joint decision-making. The mother offered parenting time on alternate weekends, shared statutory holidays, and three vacation weeks in the summer whereas I ordered parenting time every weekend, shared statutory holidays, four weeks of summer holiday, plus an additional ten days for the child to attend the father’s family hunting camp. I find that the mother’s settlement offer on parenting does not trigger the application of r. 18(14) as my decision was more favourable than her offer.
[14] Both parties agreed that the matrimonial home should be sold and the proceeds split. The mother offered to settle other debts between the parties with a payment to her of $14,000 against the proceeds of the sale while the father proposed no payment. The mother claims she was successful on this issue as I ordered $25,648 be set off against the father’s proceeds of sale.
[15] I find there was divided success on the property issue since both parties agreed to the sale of the matrimonial home. Regarding how to settle the parties’ debts, I agree the mother made a severable and more favourable offer. However, parenting was the most significant issue at trial. The bulk of the evidence, submissions, and reasons for decision centered on parenting. A person need not be successful on all issues and substantial success is sufficient to order costs: Baryla v Baryla, 2019 BCCA 192; Hall v. Sabri, 2011 ONSC 6342, at paras 8-9; Durkin v. Cunningham, 2015 ONSC 1741 at paras 37-39. Even in circumstances where parties have reached a negotiated resolution on one or more issues, the court retains discretion to award costs to the party who was more successful on an overall global basis: Wallegham v. Spigelski, 2015 ONSC 8066 at para 13; Lazare v Heitner, 2018 ONSC 4861 at para 9. As the successful party on parenting, the dominant issue in this case, I find the father is presumptively entitled to costs. However, the mother’s partial success and settlement offers are considered in determining the quantum of the award.
Issue 2: If the father is entitled to costs, what constitutes a reasonable award?
[16] In determining the amount to be awarded, r. 24(12) requires a judge to 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.
[17] In this case, the relevant factors for consideration in quantum as identified by both parties to include: the conduct of the parties, offers to settle, the time spent on various issues, reasonableness of the costs requested by the father, and the mother’s ability to pay.
Conduct of the parties
[18] Counsel for the father pleads that the mother should be held accountable for subverting the criminal justice system to strip away the father’s parental rights, for threatening the father’s liberty, and for the emotional and financial harm suffered by the father as a result of the adversarial and protracted criminal and family proceedings.
[19] At the time of separation, the mother spoke to the police following which the father was criminally charged for several counts of damage to property. It became apparent during the criminal trial that the father could not have willfully damaged a truck as alleged by the mother because photographs of the truck tailgate filed at trial demonstrated the alleged conduct was not mechanically possible. The father was acquitted at trial of all criminal charges. The father maintains that the mother fabricated these property allegations, persisted with the tailgate allegation even after the photographs were shown to her, and concocted new allegations of sexual assault against her and physical abuse of the child (throwing him) which she failed to initially report to the police or to the Office of the Children’s Lawyer (“OCL”). Furthermore, the day after I rendered my decision, the father was charged with sexual exploitation, sexual assault, and sexual interference. The mother’s sister has alleged that the father sexually abused her child in 2014.
[20] The father argues the mother’s behaviour has been and continues to be reprehensible in the extreme and warrants substantial indemnity costs. With the collusion of her family, she has done everything possible to destroy the father. She has sequestered evidence, perjured herself repeatedly, shown disregard for the father’s emotions (i.e. putting down his dog without notice), and now submits that costs should be limited to a maximum of $1,000. In contrast, the father has been stigmatized with criminal allegations of spousal and child abuse, and now pedophilia, sexual assault against a minor, and incest.
[21] The mother claims she acted reasonably throughout the litigation. The allegations of bad faith raised by the respondent relate to her behaviour during and after the marriage and not her conduct as it relates to the litigation. These allegations resulted in criminal charges for which the father was acquitted and which were also rejected by me at the family trial. Since the application was filed five years ago, the parties have co-operated in all respects. Not a single interim motion was brought by either party and the parties were able to resolve parenting issues amicably. Both parties willingly provided full and frank disclosure, responded to requests to admit, and submitted a joint document brief for the trial. Both parties provided offers to settle which were relatively close to the ultimate decision and did not take unreasonable positions in the litigation. In sum, the mother claims both parties acted very reasonably throughout the litigation. With respect to the recent criminal charges, there is no evidence that the mother had anything to do with the charges reported by her sister.
[22] I find the timing of the criminal charges brought by the mother’s sister are curious given the mother acknowledged she is very close with her sister and yet never told any authorities that there were reports the father had abused her sister’s child. In fact, the mother chose not to call any of her family members to testify at the family trial even though some of them were present to witness the father’s alleged damage to property. I agree that the recent criminal charges are highly unfortunate given the emotional and financial hardship the father has borne since separation including the costs of both a criminal and family trial. Notwithstanding that the sister’s allegations date back to 2014, in the absence of further evidence, I am not in a position to make a finding that the mother knew of them or that the timing of these criminal charges are part of an ongoing and deliberate attempt by the mother and her family to further alienate or destroy the father.
[23] The costs award in this case cannot compensate for the emotional and financial consequences of the father’s past or future criminal trials. However, 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, as per r. 2(2) of the FLRs, that cases are dealt with justly: Mattina, at para 10.
[24] Costs awards in family cases are designed to encourage settlement and to prevent unreasonable claims: Arthur v Arthur, 2019 ONSC 938, at para 9; Monroe v Blakeney, 2018 NSSC 275 at para 8. This includes unreasonable claims for sole custody: Giron v Giron, 2017 ONSC 6721, at paras. 18-22.
[25] Following the criminal trial which involved rigorous cross-examination of the father and a thorough review of the evidence involving at least some incidents, there was considerable latitude on the part of the mother to carefully consider the evidence in support of her allegations of violence against the father. The mother continued to maintain family violence as grounds for a parenting order in her favour. While the mother was entitled to make this argument, there were cost consequences in doing so. The father had to incur considerable time and expense in defending himself against allegations of family violence at the family trial. In addition to proving his competence as parent, the father had the burden of defending himself against eight incidents of alleged violence ranging from choking, threats, sexual assault, and property damage to if he had any hope of obtaining a favourable parenting order. This included gathering materials in support of his own version of events, obtaining corroborative affidavit evidence from other family members, and purchasing the criminal trial transcripts. In contrast, the mother called no corroborative evidence in support of her allegations. She did not call evidence from family members or admit the transcript of her own evidence from the criminal trial. I find the father’s litigation strategy which focused on responding to these allegations of family violence and the consequent costs were not only reasonable, but entirely necessary in these circumstances.
Time spent on issues
[26] Both parties have provided a bill of costs identifying the hours spent. Neither party delineates how much time was spent on each legal issue, i.e.. parenting, division of property. Counsel’s rates are comparable and reasonable. The mother’s counsel includes only billings for trial preparation commencing October 28, 2020, for a total of $30,619, whereas the father’s counsel includes billings from the start of the legal action around November 16, 2016, for a total of $67,256. Counsel for the father claims that the mother’s billings do not accurately represent the costs of this litigation whereas counsel for the mother argues the father is not entitled to claim for costs unrelated to trial preparation.
[27] I disagree with the mother’s counsel that none of the costs in these legal proceedings other than those directly related to the preparation for trial are compensable to the father. The FLRs encourage costs to follow each step, but do not prevent the court from awarding costs in relation to the step at a later stage: rr. 24(10) and (11)
[28] More importantly r. 24(11)(b) permits the court to consider the reasonableness of each party’s behaviour in the case. The behaviour must relate to the issues of the case for which costs are being assessed, which in this case was primarily parenting, and from the time the issues arose, which in this case was from the time of separation: Caldwell v Caldwell 2007 8919 (ONSC) at paras 12, 13, and 22. Rafeiro v. Bolhuis, 2020 ONSC 7205 at para Wallegham at para 16. Following separation, the father was unable to see his child for 20 days. Eventually, access was given as part of an interim agreement on February 2017. However, even after the father was acquitted of all the criminal charges in March 2017, there was little effort by the mother between 2017 and the trial in December 2020 to share parenting more equitably. I find the mother’s persistent refusal to move towards a more equitable arrangement for parenting time in these past five years which would have likely resolved the parenting issues was unreasonable. While her conduct may not reach the threshold of bad faith to warrant full recovery, I find it was unreasonable behaviour that warrants a higher cost award: Fearon v Fearon 2021 ONSC 2305 at paras 45 to 49.
Offers to settle
[29] It is possible to make a favourable offer on one issue and be entitled to costs on that issue, but to have missed the mark on other issues and be denied costs on those issues. Severable offers are encouraged so that costs can be issued on various issues independently: Daniel v. Henlon, 2020 ONSCJ 259 at para 66; Paranavitana v. Nanayakkara, 2010 ONSC 2257 at paras 13 and 14.
[30] The mother argues that she made a severable offer on property which the father was free to accept while rejecting her offer related to parenting. The father’s offer was not severable. Furthermore, the court’s decision on property division was double what was offered. The mother offered $14,000 to be set against the proceeds of the sale of the house whereas I ordered $25,648 be set off. The mother argues that as per r. 18(14) applies, she is presumptively entitled to costs on the financial and property issues. Her total costs for trial were $29,892. Counsel estimates that one third of that time was spent on the financial issues seeks the mother be awarded solicitor/client costs in the amount of $10,000 plus HST to be set off against any costs award to the father.
[31] The mother’s offer to settle certain debts against the proceeds of the matrimonial home was unclear. It did not delineate which debts were being settled, but simply put forth a figure. Unclear offers can disentitle a party to costs. Nonetheless, the figure was more favourable than what I awarded at trial for debts. Therefore, I find the mother should be entitled to recover some costs as it relates to the issue of the party’s debts.
[32] Counsel’s Bill of Costs does not delineate what preparation time was accorded to this particular issue. In the absence of further evidence, I am not prepared to find that the mother is entitled to precisely $10,000 plus HST to be set off against any costs award to the father: Chomos v Hamilton, 2016 ONSC 6232 at paras 53 and 54.
[33] More importantly, my role in assessing costs is not to parse the time incurred by counsel on each and every issue or to reimburse a litigant for every dollar spent on legal fees, but to make a costs’ award that is fair and reasonable based on consideration of all the relevant factors including the calculation of hours and time rates: Fearon at para 53; Lazare at para 29; Smith v Smith 2021 ONSC 26 at para 14. I find the better approach to account for the mother’s favorable offer on how to settle the parties’ debts is to apply a downward adjustment to the father’s total cost award: Smith at para 14; see also Thompson v Drummond, 2018 ONSC 4762 at para 40.
Reasonableness and ability to pay
[34] In determining quantum, I must consider whether the costs sought by the successful party is reasonable: Mattina, at para 13; Berta v. Berta, 2015 ONCA 918 at para 94.
[35] I must also consider the financial means of the parties, their ability to pay, and the effect of any costs ruling on the parties and the children: Fyfe at para 11; M.(A.C.) v. M (D.), 2003 18880 (ON CA), 231 D.L.R. (4th) 479, at para 45. However, a litigant’s limited financial means will be given less weight than the court’s determination of overall success in litigation, cannot alone override the other factors in r. 24(11), and may be accorded less weight where the court finds the party acted unreasonably: Wallegham at para 22.
[36] The mother earns less than $30,000 a year and states her partner is currently unemployed. She has no significant property other than her half share of the matrimonial home which will be sold. She owes money to her family. She expects to use the proceeds from the sale of the home to settle her debts and rent another home. She argues that in contrast, the father enjoys a collective family income of $100,000 per year and does not believe he has any debts. The mother argues that the total costs awards to the father should be limited to $1,000 and requests $10,000 be set off any cost award to the father effectively resulting in an order for the father to pay her $9,000.
[37] The father takes a different view. As his counsel points out, he has incurred excessive legal fees defending himself at the criminal and family trial largely because of the mother’s unfounded accusations of violence. Counsel for the father argues that $1,000 does not even begin to cover the father’s disbursements yet alone his legal fees. The father also has limited means and had to sell his car, his only asset, to pay for these fees. The father will have to now incur further legal fees as a result of new criminal charges brought upon by the mother’s sister.
[38] While I agree the mother’s ability to pay must be considered, I disagree it warrants a cost order limited to $1000. First, as noted in my trial judgment, both parties are of limited means. The father is on disability income and earns just under $14,000 per year. He has been able to rebuild a life with a new very supportive spouse who earns $65,579 a year. While they enjoy a collective income of approximately $80,000 per year, they also have a new child and home to support. The father has also been ordered to pay table child support.
[39] The mother claims that her new partner is now unemployed, but indicated previously in her pleadings that he was contributing $1000/month to her family household. Unlike the father who disclosed his spouse’s income, the mother never disclosed what her new partner’s income was or has been over the last few years. There is no evidence before me on what the mother’s recent household income has been, but based on the documents filed at trial, it was approximately $52,000 when including the spouse’s income. The father supports a second child whereas the mother’s household does not. The discrepancy in household income between the mother and father is not as wide as the mother suggests.
[40] Second, it is entirely unfair to suggest the father has no debts. He too will have to rely on the proceeds of sale to settle debts that have incurred since separation. More importantly, the father has incurred considerable legal fees to defend himself in both criminal and family proceedings, with more legal fees on the horizon as a result of the new criminal charges, which will indebt him further. As already addressed when discussing the conduct of the parties, much of this litigation was the result of the mother’s unfounded claims and unreasonable position on co-parenting. The mother put the father through a four day trial and on the substantial issues of parenting, she was largely unsuccessful. In these circumstances, I do not find her financial situation, which is comparable to the father’s, a sufficient reason to minimize the cost award to $1000.
[41] The overall objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the circumstances of the case, rather than an amount fixed by the actual costs incurred by the successful litigant: Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291 (C.A.), at para 26; Fearon at para 44.
[42] The father requests substantial indemnity costs in the amount of $54,006.68. Taking into consideration that the father was the successful party, the mother’s conduct during the litigation some of which I found unreasonable, the mother’s offer to settle on both parenting and financial issues, the mother’s severable and favorable offer on the parties’ debts which warrants a downward adjustment, the complexity and issues to be decided, the hours and rates calculated, the reasonableness of the amount requested, and the mother’s ability to pay, I find that a costs award to the father in the fixed amount of $45,000 is fair and reasonable in this case.
[43] No submission was made with respect to time to pay. Given the mother’s current financial situation and to ensure the cost award does not adversely impact the child, the mother will have four months to pay.
Order
[44] The mother will pay the father costs in the fixed amount of $45,000 within 120 days from the date of this order.
Somji J.
Date: September 27, 2021
Court File No.: 16-772
Date: 2021-09-27
Ontario
Superior Court of Justice
Between:
Amanda Proulx Applicant
– and –
Robert Proulx Respondent
Costs Endorsement
Somji J.
Released: September 27, 2021