COURT FILE NO.: FS-21-00000072-0000
DATE: 2021 11 04
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
L.D.
Michael J. Stangarone/Meghann Melito, for the Applicant
Applicant
- and -
K.A.
Richard Niman, for the Respondent
Respondent
Price J.
Costs Endorsement
NATURE OF MOTION
[1] The parties have been unable to resolve the issue of what compensation, if any, one of them should pay to the other for the costs they incurred in each party’s motion to determine where their children, ages 6 and 4, should attend school. These reasons address the costs of those motions.
BACKGROUND FACTS
[2] The facts that gave rise to the motions are set out in my reasons dated September 27, 2021, for the Order made in the motions. I adopt those factual findings for the purpose of this endorsement. The remainder of the facts pertinent to this costs endorsement concern the steps the parties took following their separation that led to the bringing of the motions.
[3] The parties lived together in Caledon from 2016 until their separation on February 14, 2021. As late as January 29, 2021, K.A. emailed H.C. School in Caledon to enroll the parties’ oldest child in grade one at that school that fall. This was consistent with the educational plan the parties had agreed upon when they were together. The plan entailed both children attending a French immersion program at Q-R School in Orangeville for kindergarten; then transferring to a 50/50 English/French program at H.C. School in Caledon for the balance of their elementary school studies, beginning in grade 1.
[4] Between April 9 and August 31, 2021, the parties tried unsuccessfully to resolve their dispute over what school the children should attend. The following were the highlights of their efforts:
a. On April 13, 2021, L.D. attended an intake session with a mediator, Ms. Jain, whom K.A. had proposed, but she found her to be too expensive.
b. On April 23, 2021, L.D. proposed mediation/arbitration, but K.A. responded on April 27 that she wanted the parties to make their own decisions about the children rather than having a third party arbitrate.
c. On April 27, K.A. proposed that the parties retain collaborative lawyers. L.D. discussed this with her lawyer and on May 19, advised that her lawyer was not trained in collaborative family law.
d. On June 2 and 10, 2021, K.A. consulted Bev Lemay, MSW, a mediator specializing in collaborative family law. She wanted a mediator from Orangeville, who she thought would be more neutral than someone from Caledon, where the parties had their family residence. She met with Ms. Lemay on June 14, but L.D. declined to retain her, as she wanted someone who understood the inclement weather in Caledon, which she thought relevant in assessing the options for transporting the children from the family residence to and from school.
e. On June 11, 2021, L.D.’s lawyer sent an email to K.A.’s lawyer proposing four mediators. On June 24, 2021, K.A.’s lawyer agreed to one of the four, Angela Pickard, an MSW. Ms. Pickard initially advised that she was unavailable until the fall but later became available earlier, and both parties completed their intake with her by August 10.
f. On August 31, 2021, the parties met virtually with Angela Pickard but were unable to reach agreement on the schooling issue.
[5] In the meantime, K.A. made arrangements for her own accommodation that became issues at the parties’ mediation and at the hearing of the motions:
a. After the parties separated in February, K.A. signed a lease for accommodation in Whitby, Ontario, east of Toronto. When L.D. expressed her opposition to the children living so far from their former home in Caledon when they were in K.A.’s care, K.A. was able to break her lease and found an apartment instead in Etobicoke, which was closer.
b. At some point, K.A. signed an Agreement to buy a property in Orangeville, with a closing date of October 4, 2021. On April 5, 2021, without L.D.’s knowledge, she enrolled the children at a school in Orangeville near her new residence and outside the catchment area of the family residence.
c. On August 24, 2021, L.D. looked into bussing for the younger child to the children’s previous school in Orangeville and for the older child to H.C. School in Caledon. While doing so, she discovered that four months earlier, K.A. had unilaterally and without her knowledge registered both children in the school near her new residence in Orangeville. K.A. used her parents’ address in Orangeville to qualify for admission, which L.D. claims did not comply with the school’s requirements. K.A. submitted that she enrolled the children in the school in Orangeville only to keep the parties’ options for the children’s schooling open while they negotiated a resolution of the issue, but her failure to disclose the fact to L.D. seriously eroded L.D.’s trust in her.
[6] When the parties’ dispute over the children’s school became more polarized, K.A. proposed, as an alternative, that both children continue attending the school the older child had attended in Caledon for kindergarten for six months or until the parties reached a final resolution of the school issue.
[7] After this Court heard the parties’ motions on September 23, 2021, it made an Order on September 27, 2021, directing that the younger child continue kindergarten at the school in Orangeville that the older child had attended and that the older child be enrolled at HC School in Caledon as the parties had agreed prior to their separation.
PARTIES’ POSITIONS
[8] L.D. says that she was successful in the motions and seeks an Order for her costs on a substantial indemnity scale in the amount of $9,033.00, payable forthwith.
[9] K.A. submits that each of the parties should assume their own costs, the only issue having been what school the children should attend, and given that K.A. proposed that the issue be resolved in a less costly manner by mediation/arbitration, which L.D. refused, precipitating the motions.
ANALYSIS AND EVIDENCE
a) General principles
[10] The Court of Appeal for Ontario, in Beaver v. Hill, 2018 ONCA 840, at paras. 9 to 14; and Mattina v. Mattina, 2018 ONCA 867, at paras. 9 to 18, set out the principles to be applied when determining costs in family law matters. They are as follows:
a. Cost awards are discretionary;
b. Judges in family law cases are not constrained by the scales of costs found in the Rules of Civil Procedure;
c. The Family Law Rules expressly provide that depending on the conduct of the parties and the presence or absence of offers to settle, a Judge may increase or decrease the costs that would otherwise be the appropriate;
d. There is no provision in the Family Law Rules for a general approach of “close to full recovery” costs;
e. Rule 24(12) sets out the appropriate considerations in fixing the quantum of the costs in a family law matter;
f. Proportionality and reasonableness are the touchtone considerations to be applied in fixing the amount of costs.
[11] Costs Orders are designed to achieve three principal goals, (a) to indemnify successful litigants; (b) to sanction unreasonable conduct of the litigation; and (c) to encourage settlement. See: Paranavitana v. Nanayakkara, 2010 ONSC 2257.
[12] The goal of indemnifying successful litigants is achieved through Rule 24(1) of the Family Law Rules O.Reg. 114/99. It provides:
24(1) There is a presumption that a successful party is entitled to the costs of a motion, enforcement, case, or appeal.
[13] Accordingly, a successful litigant whose conduct in a proceeding was reasonable should not be required to bear the costs of having her rights tested. See: Serra v. Serra, 2009 ONCA 395
[14] The goal of sanctioning unreasonable conduct of litigation is achieved through Rule 24(4) of the Family Law Rules. It provides:
24(4) Despite subrule (1), 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.
(5) In deciding whether a party has behaved reasonably or unreasonably, the court shall examine,
(a) the party’s behavior in relation to the issues from the time they arose, including whether the party made an offer to settle…;
[15] Accordingly, a litigant who has achieved a successful outcome may be deprived of her costs in certain circumstances, including where she has behaved unreasonably. Conversely, an unsuccessful litigant should not be required to pay the costs of a motion that the successful litigant precipitated by her own unreasonable conduct.
[16] The Family Law Rules do not explicitly provide for costs on either a partial or substantial indemnity scale. However, where the successful party has acted reasonably and the unsuccessful party has not, the Court may order the unsuccessful party, who would, in any event, be ordered to pay the successful party’s costs to indemnity that party, to pay those costs on a higher than partial indemnity scale.
[17] Where a successful party in a family law case has acted reasonably in the proceeding and the unsuccessful party has not, the preferable approach is to order that costs be paid on a full recovery basis, provided the costs claimed are proportional to the issues and outcome and were within the range that the opposing party should have expected if unsuccessful in the motion. See: Sims-Howarth v. Bilcliffe, 2000 ONSC 22584, para. 11; Biant v. Sagoo, 2001 ONSC 28137, para. 1.
[18] In Sims-Howarth v. Bilcliffe, (2000) 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 Family Law Rules. 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 Family Law Rules was approved by the Ontario Court of Appeal in C.A.M. v. D.M., 2003 18880 (ON CA), [2003] O.J. No. 3707 (C.A.), at para. 42.
[19] In Berta v. Berta 2015 ONCA 918, at paras. 92-93, the Court of Appeal stated:
[92] In Biant v. Sagoo (2001), 2001 28137 (ON SC), 20 R.F.L. (5th) 284 (Ont. S.C.), the court considered the costs award scheme under the rules and commented, at para. 20:
[T]he preferable approach in family law cases is to have costs recovery generally approach full recovery, so long as the successful party has behaved reasonably and the costs claimed are proportional to the issues and the result. There remains, I believe a discretion under Rule 24(1) to award the amount of costs that appears just in all the circumstances, while giving effect to the rules’ preeminent presumption, and subject always to the rules that require full recovery or that require or suggest a reduction or an apportionment.
[93] This court has repeatedly endorsed the Biant court’s approach to the determination of costs in family law disputes: see for example, Ruffudeen-Coutts v. Coutts, 2012 ONCA 263, 15 R.F.L. (7th) 35, at para. 4; Sordi v Sordi, 2011 ONCA 665, 134 R.F.L. (7th) 197, at para. 21; M. (A.C.) v. M. (D.), 23003), 2003 18880 (ON CA), 67 O.R. (3d) 181 (C.A.), at para. 40.
[20] As the Court of Appeal noted in Beaver v. Hill and Mattina v. Mattina, there is no provision in the Family Law Rules for a general approach of “close to full recovery” costs in all cases.
[21] There are certain circumstances, deemed “special circumstances”, in which the unsuccessful party’s conduct will be found to have acted unreasonably and will be ordered to pay the successful party’s costs on a substantial indemnity scale or on a full recovery basis. Examples of such circumstances are:
a. Where the unsuccessful party has failed to accept a reasonable Offer to Settle made by the successful party. In such circumstances, Rule 18(14) entitles the successful party to “full recovery of costs”.
b. Rule 24(8) also refers to “costs on a full recovery basis,” where a party has acted in bad faith.
c. The successful party in a motion made necessary by the responding party’s breach of a court order has historically been entitled to costs on at least a substantial indemnity scale. See: Cassidy v. Cassidy, 2011 ONSC 791, para. 14; Astley v. Verdun, [2013] ONSC 6734 (SCJ), at paras 52 to 58. This was because a finding of contempt is a finding of unreasonable conduct. Substantial indemnity costs did not follow automatically or invariably from such a finding, but the finding gave rise to a rebuttable presumption that the successful party was entitled to costs on a substantial indemnity scale.
[22] 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. It has a range of costs awards open to it, from nominal to just short of full recovery. The reason why, even in the absence of “special circumstances,” it is generally appropriate to award the successful party full recovery costs is that in many family law cases, the applicable principles are well established and the rights of the successful party make the outcome of a motion self-evident. For example:
a. A parent with whom children are principally resident and with whom the children spend more than 60% of their time, is generally entitled to child support from the other parent in the amount prescribed by the table in the Federal Child Support Guidelines. The outcome of an application or motion by such a parent is self-evident and should not require litigation to determine. In such a case, in the absence of extenuating circumstances, costs should be awarded to the successful litigant on a full recovery basis.
b. A parent who, without obtaining a court order or consent of the other parent, removes the parties’ children from the jurisdiction in a manner that interferes with the other parent’s parenting time with the children will almost invariably be required to return the children. An application or motion should not be necessary. If one is brought, in the absence of extenuating circumstances, the outcome will be a foregone conclusion. In such a case, the parent who is put to the expense of an application or motion is entitled to her costs on a full recovery basis.
[23] 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 she may face if unsuccessful. In Perri v. Thind et al., 2009 34977 (ON SC), 98 O.R. (3d) 74 (S.C.), Henderson J. granted leave to appeal to the Divisional Court from a costs award that was a marked departure from the normal or routine costs made in motions court. In doing so, he stated that costs orders are not designed mainly to be a punishment, but acknowledged that costs, when awarded on a higher scale, can serve to express the court’s disapproval of unreasonable conduct. See: Perri, at paras. 24-26, 32-33.
b) Applying the principles to the facts of the present case
Indemnifying the successful party
[24] It is not disputed that L.D. was successful in the outcome of the two motions. She is therefore presumptively entitled to her costs pursuant to Rule 24(1) of the Family Law Rules.
Sanctioning unreasonable conduct
[25] K.A. submits that L.D. should be deprived of her costs by reason of her unreasonable conduct in refusing to submit the parties’ dispute to a less costly means of dispute resolution by mediation/arbitration.
[26] L.D. submits that K.A. should be ordered to pay her costs on a substantial indemnity scale because L.D. was simply trying to compel adherence to the education plan the parties had agreed to before their separation and the outcome of the motion was therefore self-evident.
[27] For the reasons that follow, I disagree with both of these positions. I find that L.D. is entitled to her costs on a partial indemnity scale.
c) Offers to Settle
[28] Failure to accept a reasonable Offer to Settle is unreasonable conduct of the kind that most often results in an award of costs on a higher than partial indemnity scale. In the present case, no Offers were exchanged by the parties.
[29] L.D. states that she made multiple requests, which K.A. rejected, that the parties follow the education plan the parties had agreed upon when they were together. She argues that her requests were effectively offers to settle, given that the nature of the proceeding created a limited scope for compromise.
[30] I do not regard L.D.’s repeated requests as Offers to Settle. They did not entail compromise or seek common ground between her own wish that the parties adhere to their original education plan and K.A.’s wish that the children attend school in Orangeville.
[31] K.A.’s proposal that both children remain at their previous school represented more of a compromise, which L.D. rejected. For the reasons set out on September 27, that result was not in the children’s best interests and K.A.’s proposal was not more favourable to L.D. than the outcome of the motions so as to deprive L.D. of her entitlement to costs.
d) K.A.’s enrollment of the children in a school in Orangeville
[32] L.D. says that K.A., instead of acceding to her requests, tried to rely on a unilaterally imposed post-separation status quo, by registering the children in a school in Orangeville without notifying L.D. that she had done so. L.D. characterizes this as unreasonable conduct that should entitle L.D. to recovery of her costs on a substantial indemnity scale.
[33] L.D. asserts that K.A. changed her position on the children’s school five times following the parties’ separation. She says, “While the Respondent flip-flopped in her position, the Applicant maintained her position throughout the litigation that the children should continue to maintain their habitual residence in Caledon and continue with their educational plan in their best interests, as the parties previously agreed while and intact family and post-separation when the Respondent herself made contact with [HC School} to secure [the older child’s] registration at that school before attempting to unilaterally and secretly disrupt the parties’ plan.”
[34] While L.D. characterizes the positions K.A. advanced as self-serving “flip-flops,” I regard them as changes that reflected the changes in the parties’ relationship and, in part, an effort to preserve the parties’ options while they negotiated a resolution of the issues arising from their separation, including whether L.D. would remain in the family residence or move to another area herself.
[35] The parties’ children resided in Caledon while the parties were together. If either parent had sought to remove them from their home, interfering with the other parent’s presumptive right to parenting time with the children, the outcome of a motion by the other parent to compel their return would have been a foregone conclusion. In that case, in the absence of extenuating circumstances, costs would likely have been awarded on a full recovery basis. That was not the situation here. Neither parent sought to deprive the other of parenting time. The only issue was what school the children should attend.
[36] If there had been an Order directing that the children attend H.C. School, or giving decision-making responsibility to L.D., who wished to enroll them there, then K.A.’s enrollment of them in a different school would have been unreasonable. If it had become necessary for L.D. to make a motion to assert her wishes, the result would similarly have been a foregone conclusion and the Court would likely have awarded L.D. her costs on a full recovery basis. That also is not the situation. Each parent presumptively had decision-making responsibility and was free to enroll the children in any school they wished whose catchment area encompassed their residence.
[37] K.A. believed that the parties’ relationship was a fundamental premise of their education plan for their children and that, as a result of their separation, the plan was no longer viable. She could no longer afford to live in Caledon and bought a more affordable home in Orangeville and enrolled the children in a school there. She argued that most of the children’s activities and friends were in Orangeville and that it was in their best interests to attend school there.
[38] L.D. believed that the education plan the parties had developed when they were together was still in the children’s best interests and should not be affected by the parents’ separation.
[39] The fact that the parents would now be residing in different cities and different school catchment areas affected what school it was in the children’s best interests to attend. The children had to attend a school where they resided and had to be transported from their residence to their school. Their residence affected their activities and friends, as well as their travel time, so the parties’ decisions following their separation as to where they would reside affected what school it would be in their children’s best interests to attend. In these circumstances, the outcome of the motions was not self-evident.
[40] K.A. was not the only parent making the decisions that affected the choice of the children’s school. Although it was she who left the family residence and bought a home elsewhere, the parties’ separation also created uncertainty regarding L.D.’s continued residence in the family home. K.A. sought to have that issue resolved before the choice of school was made, but the need for the choice of school to be settled when the school year began prevented that.
[41] Although K.A.’s enrollment of the children in a school in Orangeville was partially calculated to give her a strategic advantage in relation to the choice of school and perhaps the children’s residence, that was not her only rationale, and her conduct cannot be regarded as so unreasonable as to attract a higher level of costs.
[42] Recognizing that the issue of where L.D. would be residing was intertwined with the issue of what school the children would attend, L.D. asserted that even if she did not buy K.A.’s interest and remain the family residence, she would remain in Caledon. K.A. disputed L.D.’s ability to do that, but the Court concluded, for the purpose of the motions, that she would do so.
[43] In these circumstances, the outcome of the motions could not be predicted by applying well-established principles. Because the outcome was not self-evident, the goal of sanctioning unreasonable conduct of the litigation would not be achieved by ordering costs to be paid on a higher than partial indemnity scale.
e) L.D.’s refusal to submit to mediation/arbitration
[44] K.A. argues that L.D.’s refusal to participate in mediation/arbitration should disentitle her to her costs. She submits that this case should have settled with the assistance of a skillful mediator, thereby avoiding the significant costs of the motions. She points to various exchanges that occurred between counsel on the subject of mediation. Ultimately, L.D. refused to engage in mediation/arbitration to resolve the school issue as she wanted the parties to make the decisions themselves or for the Court to decide.
[45] L.D. argues that K.A. delayed the resolution of the school issue by initially insisting that the parties engage a mediator or mediator/arbitrator in Whitby, Ontario, and then refusing to work with professionals who were closer, including Tina Hinsberger, a local BSW. After K.A. insisted that any professional had to have an MSW, L.D. gave her four names. K.A. chose Angela Picard who was initially not available until the Fall of 2021 but who later became available earlier. When she did, both parties agreed to retain her but were unable to reach agreement even with her help.
[46] L.D.’s refusal to submit to arbitration, especially when the Court later validated her position that the parties’ education plan, and the choice of schools it entailed, was still in the children’s best interests, does not disentitle her to her costs. In Baldwin v. Daubney, (2006) 2006 33317 (ON SC), 21 B.L.R. (4th) 232 (Ont. S.C.J.), at para. 12, Spence J. declined to consider a refusal to mediate as a factor in the exercise of his costs discretion:
The plaintiffs say that the defendants refused the request of the plaintiffs to mediate and thereby caused the motion to proceed with its attendant costs, which a successful mediation would have avoided. The defendants say they considered they had a good defence and were not obliged to mediate. Mediation is most likely to be successful where each party considers it has something material to gain from a settlement and appreciates that to achieve a settlement it will need to accept a compromise of its position. Where one litigant is confident that its position will succeed in court, it has little reason to take part in a process that would yield it a lesser result and it is not bound to do so. Indeed, to take part in a mediation in such circumstances could simply prolong the process and add to the cost.
[Emphasis added]
[47] Where mediation has a reasonable prospect of success, and a refusal to participate reflects a party’s unwillingness to entertain a less expensive and speedier means of resolving the issues in a just manner, it can be regarded as unreasonable conduct and attract a costs sanction. Mediation often offers a less expensive means of resolving family law disputes than adjudication. See: Joanne Gross, An Introduction to Alternative Dispute Resolution, 1995 Docs 178, at page 9, in which the author cites research conducted in 1990 by J. Kelly, Past President of the Academy of Family Mediators, which showed that the mean cost of the adversarial process for both the husband and wife combined was 134 percent higher than the costs of comprehensive mediation.
[48] In their article, Resolving Family Law Disputes, Infographic, Canadian Forum on Civil Justice, 2018 Docs 11081, https://canlii.ca/t/t1n5:, the authors report that they asked 166 lawyers practicing family law in Alberta, British Columbia, Ontario and Nova Scotia questions about the benefits, limitations, cost, and suitability of Collaboration, Mediation, Arbitration and Litigation to resolve different types of family law problems. The authors state:
A majority of lawyers agreed that mediation, arbitration and collaboration are usually cost-effective. Typical low-conflict cases resolved through collaboration or mediation cost almost half that of low- conflict cases resolved through arbitration or litigation….
[49] Joanne J Paetsch, Lorne D Bertrand and John-Paul Boyd came to the same conclusion in An Evaluation of the Cost of Family Law Disputes: Measuring the Cost Implication of Various Dispute Resolution Methods, Canadian Forum on Civil Justice (www.cfcj-fcjc.org) 2018 Docs 11070; as do Noel Semple and Nicholas Bala in an article, Reforming Ontario's Family Justice System: An Evidence-Based Approach, 2013 Docs 498, at pages 147-148.
[50] Where the Court rules make participation in mediation mandatory, a refusal to mediate amounts to a contempt of court and unreasonable conduct. That constitutes a special circumstance that will presumptively disentitle a successful party who refused to her costs or result in an order requiring the unsuccessful party who refused to pay costs on a higher scale. This is because where mediation is mandated, it can be inferred that regulators have concluded that it offers a potentially successful, less expensive, and more timely method of resolving the dispute in a just manner and that the refusal to participate is therefore unreasonable.
[51] For example, section 258.6(2) of the Insurance Act, R.S.O. 1990, c.I.8, provides that a person’s failure to comply with the mediation requirements of the Act “shall be considered by the court in awarding costs”. In Williston v. Gabriele (2013), 2013 ONCA 296, 115 O.R. (3d) 144 (C.A.), at para. 25, it was held that where a party repeatedly requested mediation and the insurer never agreed to participate, despite its statutory obligation to do so, “an augmented costs award was warranted”.
[52] In the civil case of David v. Transamerica Life Canada, (2016) 2016 ONSC 1777, 131 O.R. (3d) 314, at para. 97, this Court ordered an insurer to pay the respondent’s costs because it had refused to participate in a mediation over disputed insurance proceeds:
In cases where each of the parties has an arguable case, and each faces a risk of loss in the proceeding, mediation can offer a reasonable prospect of settlement. In such cases, a refusal to participate in mediation is a factor that the court can properly consider in determining whether the party has engaged in unreasonable conduct that has caused unnecessary costs to be incurred and that warrants rebuke by means of a costs sanction. This determination requires a case-by-case analysis.
[53] Justice Mew agreed with this approach in Canfield v. Brockville Ontario Speedway, 2018 ONSC 3288, at para. 47. At para. 49 and following, he cited the position in England and Wales, as summarised by Professor Adrian Zuckerman in Zuckerman on Civil Procedure, 3ed (London): Sweet & Maxwell, 2013 at p.1335) as follows:
[49]…The court may take the view that had the parties engaged in ADR, the dispute would have settled without proceedings and therefore disallow all or some of the costs of the party who declined ADR even if that party was successful. Experience shows, as Brooke L.J. explained in Dunnett v Railtrack Plc [2002 EWCA Civ 303, [2002] 2 All E.R. 850 at para. 14], that:
When the parties are brought together on neutral soil with a skilled mediator to help them resolve their differences, it may very well be that the mediator is able to achieve a result by which the parties shake hands at the end and feel that they have gone away having settled the dispute on terms with which they are happy to live.
[50] Professor Zuckerman does, however, go on to note, again, consistent with the sentiments expressed by Price J. in David v. Transamerica:
The Court of Appeal has accepted, however, that not all disputes are suitable for mediation and that a refusal of mediation may well be justified. It was held [in] Halsey v Milton Keynes General NHS Capital Trust; Steel v Joy, [2004 EWCA Civ. 576, [2004], 1 W.L.R. 3002] that before making an adverse costs award for a refusal to participate in mediation the court must consider whether the refusal was justified. Depriving a successful party of his costs is justified only if the unsuccessful party shows that the successful party acted unreasonably in refusing to agree to ADR. The reasonableness of ADR refusal, Dyson L.J. explained, must be judged by reference to all of the circumstance [sic.], including the following: (i) the nature of the dispute; (ii) the merits of the case (the factor that a party reasonably believes that he has a strong case is relevant to the question of whether he has acted reasonably in refusing ADR); (iii) whether other methods of settlement have been attempted; (iv) whether the costs of the ADR would be disproportionately high; (v) delay in suggesting mediation which may have the effect of delaying the trial of the action; and (vi) whether the mediation had a reasonable prospect of success.
[Emphasis added]
[54] Neither the Family Law Act nor the Family Law Rules requires parties to participate in a mediation before making an application or motion to have a dispute regarding decision-making or parenting adjudicated.
[55] In Sang v. Suteu, 2016 ONCJ 160, in which the issue was what parenting arrangements were in the child’s best interests, Justice Zisman held, at para. 29, that he did not have evidence as to the details of the parties’ settlement positions before trial and was therefore unable to determine which party was being unreasonable when the mother made repeated attempts to resolve the dispute by agreeing to mediation and the father refused.
[56] In the present case, the parties were unable to reach agreement when they attended a mediation with Ms. Packard. I do not find that either party’s earlier refusal to participate in a mediation on the other’s terms was unreasonable or should affect the costs order to be made.
f) Encouraging settlement
[57] The third main goal of a costs order is to encourage settlement. The parties’ property issues, including the issue of whether L.D. will buy K.A.’s interest in the family residence, have yet to be determined. An order granting L.D. her costs of the motions on a higher than partial recovery scale will send the wrong message to her in approaching the remaining issues.
[58] L.D.’s language in her costs submissions reflects a polarization that is not conducive to settlement. For example, she imputes oblique motives to K.A. in paragraph 2 of her costs submissions, where she states, “Instead, the Respondent attempted to rely on a manufactured post-separation status quo after she purchased a property outside the children’s catchment area in a different city.” In paragraph 6, she negatively characterizes K.A.’s alternative positions by stating, “…the Respondent flip-flopped in her position,…” and later imputes oblique motives to her by stating, “before attempting to unilaterally and secretly disrupt the parties’ plan.” In paragraph 7, she states, “The Respondent secretly enrolled the children in a different school and concealed this information from the Applicant for over four (4) months.”
[59] An order requiring K.A. to pay L.D.’s costs on a full recovery basis might appear to reward L.D. for demonizing K.A. and attributing blame to her in a way that inflames the conflict. The truth is that the costs of the motions were, to some degree, simply the cost of the parties’ conflict and the fault of neither party.
[60] It will encourage settlement for the Court to order costs on a partial indemnity scale, to communicate that the parties’ issues are, in large measure, problems that each of the parties has contributed to in their own way and which they and their counsel need to approach with a collaborative and constructive problem-solving frame of mind. They are not reflections of a character flaw of either party and should not be approached in a one-sided, combative, and “no holds barred” manner that seeks to hold one party entirely at fault as a wrongdoer and the other entirely blameless as an innocent victim.
g) Amount of costs
[61] It is not disputed that the choice of school was important to both parties. The issues were not complex, but the issue has an impact on the parties’ relationships with the children, which is not quantifiable in financial terms.
[62] L.D.’s lawyers’ rates is mis-stated at the beginning of her Bill of Costs. The Bill of Costs states that Michael Stangarone, who has practiced law for 16 years, having been called to the bar in 2005, charges an actual hourly rate of $298.47, while Meghann Melito, who has practiced law for only 6 years, having been called to the bar in 2015, charges a higher actual hourly rate of $397.95. The individual time entries for the work done disclose that Mr. Stangarone’s time is, in fact, charged at $ 397.95 while Ms. Melito’s time is charged at $298.47. The3 lawyers were assisted by their law clerk, Tanille Jordan, who has been employed since 2011 and whose time was charged at $106.12.
[63] According to the Information for the Profession Bulletin issued in 2005 by the Costs Sub-Committee of the Rules Committee (the “Costs Bulletin”), which can be found immediately before Rule 57 in both the Carthy and the Watson & McGowan editions of the Rules, which sets out maximum partial indemnity hourly rates for counsel of various levels of experience, lawyers such as Mr. Stangarone, who have practiced law for between 10 and 20 years, were entitled to claim costs, on a partial indemnity scale, of up to a maximum of $300.00 in 2005. According to the Inflation Calculator on the Bank of Canada’s web site, that amount, adjusted for inflation, is currently $395.48. The Costs Bulletin set out maximum partial indemnity rate of $225.00 for lawyers such as Ms. Melito, who have practiced for less than 10 years. That amount, adjusted for inflation, is now $296.61. The Costs Bulletin assigned an hourly rate of $80.00 for law clerks which, adjusted for inflation, is currently $105.46.
[64] The partial indemnity rates in the Costs Bulletin are reserved for cases of maximum complexity. The lawyers in the present case had less than the high end of the range of years of experience to which the maximum rate applies, and the present motions were not highly complex, factually or legally. I am therefore assigning a partial indemnity rate of $350.00 to Mr. Stangarone, $270.00 to Ms. Melito, and $105.00 to Ms. Jordan.
[65] Mr. Stangarone spent 7.3 hours on the motions, which at $350.00 per hour translates to $2,555.00. Ms. Melito spent 19.3 hours, which at $270.00 per hour translates to $5,211.00. Ms. Tenile spent 1.7 hours, which at $105.00 per hour translates to $178.50.
[66] The time spent by L.D.’s lawyers was reasonable. K.A. notes that L.D.’s Bill of Costs includes times spent preparing and attending an urgent case conference (2 hours at $596.94); one day (4½ hours) spent on video calls and calls with the client, and reviewing opposing counsel’s 9 page affidavit and 9 page factum; and, approximately 17.7 hours preparing 3 separate affidavits for the urgent motion, for a total of 28.3 hours.
[67] K.A. argues that it is not appropriate to include the costs of the urgent case conference, as both parties were equally unsuccessful in settling the issue. She submits that including the costs of the case conference would be purely punitive towards K.A. I disagree. The purposes of a costs order apply equally to the Case Conference, which was a procedural requirement for proceeding to the hearing of the motion. There is no reason L.D. should not be compensated for the costs she incurred in taking that step as there is no evidence that she took unreasonable positions at the Case Conference that accounted for the parties’ failure to settle at that stage.
[68] K.A. has not alleged that the time spent by L.D.’s lawyers was unreasonable. In any event, she has not filed a Bill of Costs or dockets setting out the time her own lawyers spent, which might enable the Court to compare the time each party’s lawyers spent in order to determine whether the time L.D. claimed was excessive. In Risorto v. State Farm Mutual Automobile Insurance Co., 2003 43566 (ON SC), 64 O.R. (3d) 135, 32 C.P.C. (5th) 304 (ON S.C.), Winkeler J. noted, at paragraph 10, that an attack by one party on the time claimed by the other as excessive, without submitting evidence of the time spent by her own lawyers “is no more than an attack in the air”.
[69] The total time spent by L.D.’s lawyers, on a partial indemnity scale, entitles her to costs of $7,944.50 plus HST (13%, or $1,032.79). This results in total costs of $8,977.29, which is only slightly less than the total of $9,033.00 that she has claimed on a substantial indemnity scale.
[70] I am not adding $1,000.00 for the preparation of L.D.’s costs submissions and the result would exceed the total amount she has claimed on a substantial indemnity scale. I am, however, adding a small amount for the costs submissions, to award her the full amount of $9,033.00 that she has claimed.
[71] K.A. submits that requiring her to pay the costs claimed immediately will result in financial hardship for her, and that she is at a financial disadvantage compared to L.D., owing to L.D.’s higher earnings and the fact that L.D. has remained in the family residence. Based on these considerations, I am ordering that the costs shall be paid when the remaining issues are resolved by Order or agreement, or when the family residence or K.A.’s interest in it is sold or transferred, whichever is sooner. Post-judgment interest shall accrue on the costs in the meantime.
CONCLUSION AND ORDER
[72] For the foregoing reasons, it is ordered that:
K.A. shall pay L.D. costs in the amount of $9,033.00, inclusive of HST and disbursements.
The costs shall be paid when the remaining issues in the proceeding are resolved by Order or agreement, or when the family residence or K.A.’s interest in it is sold or transferred, whichever is sooner.
K.A. shall pay post-judgment interest on the above costs at the rate prescribed by the Courts of Justice Act from the present dated to the date of payment.
(Signature of Judge)
Price J.
Released: November 4, 2021
COURT FILE NO.: FS-21-00000072-0000
DATE: 2021 11 04
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
L.D.
Applicant
- and –
K.A.
Respondent
COSTS ENDORSEMENT
Price J.
Released: November 4, 2021