Court File and Parties
COURT FILE NO.: FC-16-2497 DATE: 2021/10/20
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: J.E.A., Applicant AND A.S., Respondent
BEFORE: Regional Senior Justice C. MacLeod
COUNSEL: Stephen Pender, for the Applicant John Summers, for the Respondent
HEARD: October 15, 2021
Endorsement & Costs Decision
[1] Following the trial of this matter and my reasons found at 2021 ONSC 4300, counsel attended before me (by Zoom) to settle the form of the judgment and to argue the issue of costs.
Formal Judgment
[2] Dealing firstly with the form of the judgment, counsel had highlighted differences in their respective drafts. Differences in the proposed wording of parenting clauses in a formal judgment are not uncommon. Although the parties had submitted draft orders prior to the trial, those drafts are tools for the trial judge and the court is not at that stage required to engage in a clause by clause review of those documents. In some instances, the proposed drafts are no longer appropriate because of the decisions made by the trial judge. By the date of the appearance before me, counsel had largely resolved the issues and to the extent there was still disagreement, I was able to provide the appropriate direction.
[3] The draft judgment also contained terms which both counsel agreed should form part of the final judgment, but which had not formed part of my reasons. This is also common because the reasons focus on the questions to be adjudicated and not on the terms to which the parties agree. It is entirely appropriate for counsel to ask the judge to incorporate such terms in a formal judgment with a view to clarifying the roles and rights of the parents and to avoid future difficulties. I approved of all of the agreed wording which was set out in italics in the draft. Those provisions are consistent with the direction given in paragraph 78 of the reasons.
[4] Counsel may now proceed to formalize the judgment and provide a final version approved as to form and content. The judgment should also include the costs award addressed below.
Costs
[5] Counsel provided the court with bills of costs indicating that each of the parties to the litigation had incurred legal fees of between $50,000.00 and $57,000.00, including the time spent in trial. The question now is whether either party should be required to reimburse the other for some or all of those costs pursuant to Rule 24 of the Family Law Rules.
[6] Fixing costs in family law proceedings is not a mechanical exercise nor is it identical to fixing costs under the Rules of Civil Procedure, although many of the same considerations apply. As with all steps under the Family Law Rules, the court must be guided by the primary objective of dealing with the case justly and in a manner that is fair to both parties. There is a useful summary of the approach to costs under the family rules at paragraphs 16 – 21 of Jackson v. Mayerle, 2016 ONSC 1556 cited in the respondent’s case book and also at paras. 9 – 18 of Mattina v. Mattina, 2018 ONCA 867 cited by the applicant.
Who was the successful party?
[7] A central part of the analysis is to determine which party was the “successful party” or whether “success was divided”. This is important because of the presumption that a successful party is entitled to costs. Various theories were advanced to suggest that either the applicant or the respondent was the successful party based upon the pleadings, positions advanced at trial, most recent offers or by parsing each component of the award.
[8] I prefer a simpler metric. Who is the primary beneficiary of the matters adjudicated? In this case, it is the applicant. The applicant obtained judgment for a property claim, child support arrears, spousal support and parental decision making. When measured against the pleadings, and the issues set for trial, this constitutes success. See Johnstone v. Locke, 2012 ONSC 1717. The applicant is presumptively entitled to costs.
[9] This does not mean that costs must necessarily be awarded to the applicant nor does it speak to the level of recovery, but it is the starting point for my analysis. The presumption may be displaced by offers to settle, by behaviour of the parties or by other factors set out in the rule. Nor does the presumption speak to the level of recovery. A court must apply all of the applicable factors in determining a just costs award. See Beaver v. Hill, 2018 ONCA 840 @ paras. 9 – 12.
Offers to Settle
[10] The next consideration is the offers to settle. Rule 18 provides that in circumstances where an offer to settle is as favourable or more favourable than the result obtained at trial, there will be significant cost consequences. That is not the case here. There were several offers to settle, but there was no comprehensive offer to settle that was equal or better to the result at trial.
[11] Offers to settle are still relevant. They reveal how close the parties were on certain issues and the court may conclude that certain aspects of the trial should have been avoided. They also give insight into how reasonable the parties were and may inform the court’s discretion in fixing costs. Even where offers do not engage Rule 18, they are a factor to be considered under Rule 24. See De Santis v. Hood, 2021 ONSC 5496.
[12] In this case, the parties adopted different approaches in their negotiations. The applicant made offers to settle that were comprehensive and would have required acceptance of all of the terms. The respondent made discrete offers to settle proposing, for example, to settle the property claims or the spousal support claims. Acceptance of any one of those offers would have narrowed the issues and removed an issue for trial.
[13] Both approaches have merit. Family law proceedings are complex, and the issues are intertwined. Child support is dependant on the parenting regime and on establishing income. Spousal support is related to means and the ability to pay. It may or may not be reasonable to settle one issue without knowing the outcome of the other issues. In this case, however, the offers of the respondent on property and spousal support are very close to or superior to what was obtained at trial. Had they been accepted, the trial would have been significantly shortened. See Jackson v. Mayerle, mentioned above, at paragraph 35.
Reasonableness of the Amounts Spent
[14] Given that this matter was before the court for almost five years and resulted in a 7-day trial and the fact that the bills of costs are very similar, I cannot conclude that the amounts spent were unreasonable. In relation to the trial itself, the parties were represented by experienced counsel who did their very best to present evidence that was relevant and focused in a manner that was as efficient as possible. Add to that the challenges of going to trial mid-pandemic with the attendant need to master new technology and court procedures, the bills of costs themselves are reasonable.
[15] The delays in getting to trial are partially explained by the concurrent criminal proceedings at the start of the proceeding, partly by misplaced optimism that the trial could be avoided, partly by changes in counsel and ultimately by the suspension of in-court hearings when the COVID-19 outbreak began.
[16] Although reasonableness of the amount spent on the dispute is one of the factors under Rule 24, in this case that is not a significant factor. I recognize that a justice system which requires parents to collectively spend more than $100,000.00 to reach the point of adjudication is open to significant criticism. On the other hand, most people badly underestimate the time and cost involved in establishing disputed facts to the satisfaction of a neutral third party. This is not the fault of counsel, and these bills of costs are in no way extraordinary for the work that was done or the time that was spent.
[17] The question that is germane is what proportion of those expenses should be shifted to the other party? In family law cases that assessment is not constrained by the formulaic thinking that is sometimes found under the civil rules, but it is seldom the case that a party is entitled to full recovery of all of his or her costs.
Behaviour of the Parties
[18] In considering the costs of the trial, the court must consider not only the conduct of the trial, the positions taken by the parties and the nature of the evidence, but also the history of the proceeding and the issues that drove the litigation. This does not mean that the trial judge should revisit costs awards made at motions or specifically award costs for steps where costs were neither sought nor awarded at the time (see Bortnikov v. Rakitova, 2016 ONCA 427 – although Rule 24 (11) passed in 2018 now permits this). Trial time, however, was devoted to the history of the father’s attempts to gain parenting time with the child and the painfully slow, reluctant and grudging concessions made by the applicant. As the record indicated, those concessions were normally only obtained on the eve of a court appearance.
[19] A further issue addressed in the reasons was the refusal of the applicant to engage in direct communication with the respondent. While this must be understood in light of the traumatic violent incident which occurred at the end of the relationship, it was nevertheless an extreme response and a driver of cost. Only at the trial or shortly before, did the mother finally agree to using an electronic service for the exchange of information or for changes to the parenting time. Her proposal to extend the weekend parenting time in exchange for eliminating the mid-week access visit was also an 11th hour change in position.
[20] For his part, notwithstanding his offers to settle which have now been disclosed, and his admission at trial that the parties had always intended for the applicant to have some share in the increase in equity, the respondent withheld those funds. More significantly, he took the position at trial that the applicant was not entitled to any share of the proceeds of sale. He also failed to pay what he admitted were arrears of child support on the basis of credits he was seeking for the carrying costs of the home when he was prohibited from living there.
[21] I am conscious of the principle that caution should be used in awarding costs of disputes over parenting issues. Costs awards should not have the effect of discouraging adjudication of matters legitimately necessary to establish the best interests of children. See Wallegham v. Spigelski, 2015 ONSC 8066. That is not the case here. By the time of trial, there was no question that a relationship between the child and the respondent was in the best interests of the child. The issue was the inability of the parties to come to terms on a schedule or the manner in which they could effectively communicate regarding important decisions. Although I provided the mother with the final decision in making parenting decisions, I found her refusal to meaningfully involve the father in important decisions to be unreasonable.
[22] Ultimately a trial was necessary to resolve these issues. I am of the view that the mother’s particular rigidity over the parenting issues and the resulting fear of alienation on the part of the father, drove the parties to trial. The respondent was not blameless. He sought to use the financial issues as leverage. Furthermore, though he modified the position at trial, he continued to advocate for an eventual equal division of parenting time and sought to have that included in the judgment.
Conclusion
[23] In outlining my analysis above, I am not revisiting the reasons given at the end of the trial nor making additional findings of fact. Those reasons must stand on their own. I am simply addressing the principal arguments made by counsel and the main factors that have guided me in fixing costs. While fixing of costs is not a scientific exercise and is an exercise of discretion, it is important that it not be seen as arbitrary.
[24] Under all of the circumstances, the applicant remains entitled to costs, but to a reasonable and modest amount and not to full indemnity. Having seen the offers to settle, it is clear that the respondent made reasonable offers to settle the financial issues which could have been taken out of the equation and shortened the trial.
[25] I fix the applicant’s costs at $28,000.00 (inclusive of fees, disbursements and HST). The formal judgment should reflect this amount in addition to the amounts awarded at trial for the substantive claims.
[26] Mr. Pender also asked for an order that the costs be paid within a particular time frame. That is not necessary. A judgment, including a costs award, is enforceable as soon as it is pronounced unless the court otherwise specifies.
[27] That is the case here. I would think that the parties might usefully negotiate a payment schedule to save both parties the additional costs and tension of enforcement steps. For that purpose, it may be reasonable to allow a month or two, but it is the responsibility of the judgment debtor to make a proposal for a payment plan and it is the right of the judgment creditor to pursue enforcement.
[28] This does not apply to the ongoing periodic support of course. Ongoing periodic child support is a first charge on the respondent’s income, must be the first priority for payment and will be enforced by the Family Responsibility Office unless the Applicant decides to withdraw from automatic enforcement.
[29] Counsel may direct the formal order to my attention for signature through my judicial assistant.
Regional Senior Justice C. MacLeod
Date: October 20, 2021
COURT FILE NO.: FC-16-2497 DATE: 2021/06/15
ONTARIO SUPERIOR COURT OF JUSTICE
RE: J.E.A., Applicant AND A.S., Respondent
BEFORE: Regional Senior Justice Calum MacLeod
COUNSEL: Stephen Pender, for the Applicant John Summers, for the Respondent
ENDORSEMENT & COSTS DECISION
Regional Senior Justice Calum MacLeod
Released: October 20, 2021