Marjan Atashi Golestan v. Vahid Ebrahimzadeh
COURT FILE NO.: FS-21-21679
DATE: 20210921
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Marjan Atashi Golestan, Applicant
and
Vahid Ebrahimzadeh, Respondent
BEFORE: M. Kraft, J.
COUNSEL: James H. Herbert, for the Applicant
Belinda Rossi, for the Respondent
HEARD: In writing
COSTS ENDORSEMENT
[1] This is the costs endorsement in respect of a long motion heard by me on August 9, 2021, in which both parties brought motions seeking temporary orders for parenting time with the two children and decision-making authority. The applicant sought a very restrictive parenting time order, among other things, namely that the respondent have supervised parenting time with the children at an access centre, for four hours a week, arising from her concern that there was an imminent risk that he would abduct the children to Iran. She also sought the involvement of the Office of the Children’s Lawyer (“OCL”) to conduct a Voice of the Children report. The respondent, among other things, was seeking an equal parenting-time schedule and joint decision-making.
[2] On August 18, 2021, I ordered that the children have equal parenting time with the parties on a week on/week off basis, and that the non-resident parent spend Tuesday, from after school, to Wednesday morning, with the children. I also ordered the parties to share joint decision-making responsibility for the children; that the parties retain a qualified mental health professional to assist them with co-parenting after separation; that the applicant surrender the children’s Canadian passports, American passports and Iranian passports, along with the children’s birth certificates to her counsel; and requested the involvement of the OCL to conduct a custody and assessment pursuant to s.112 of the Courts of Justice Act. Further, I dismissed the respondent’s motion seeking the release of $100,000 from the net proceeds of sale from the sale of the parties’ matrimonial home, without prejudice to his right to return the motion on a more fulsome record.
[3] The respondent seeks costs in the sum of $66,070, on a full recovery basis on the basis that the applicant engaged in bad faith conduct. In the alternative, he seeks costs on a partial recovery basis of $49,533.
[4] The applicant acknowledges that costs should flow in favour of the respondent but takes the position that the amount of costs sought by him is excessive. Instead, she submits that an award of costs in the respondent’s favour in the sum of $20,000 would be appropriate.
Legislative framework
[5] Subject to the provisions of an Act or the rules of court, costs are in the discretion of the court: Courts of Justice Act, R.S.O. 1990, c. C.43, s.131. Rule 24(10)(a) of the Family Law Rules, O. Reg. 114/99 (FLRs) requires that the court make a decision on the costs of a step in the case promptly after dealing with the step, in a summary manner.
[6] 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 Rule 2 (2) of the FLRs: Mattina v. Mattina, 2018 ONCA 867.
[7] A successful party is presumptively entitled to costs pursuant to rule 24(1) FLRs. An award of costs, however, is subject to the factors listed in r.24(11); the directions set out under s.24(4) (unreasonable conduct); r.24(8) (bad faith); r.18(14) (offers to settle), and the reasonableness of the costs sought by the successful party: M.(A.C.) v. M.(D.) (2003), 2003 18880 (ON CA), at paras.40-43; Berta v. Berta, 2015 ONCA 918, at para. 94.
[8] The factors to consider in setting the amount of costs are listed in r. 24(12). The court must consider the reasonableness and proportionality of a number of factors as they relate to the importance and complexity of the issues. These factors include each party’s behaviour; the time spent by each party; any written offers to settle, including those that do not meet the requirements of r. 18; any legal fees and any other expenses; and any other relevant matter.
[9] The touchstone considerations of costs awards are proportionality and reasonableness: Beaver v. Hill, 2018 ONCA 840, at para. 12. In Boucher v. Public Accountants Council (Ontario), 2004 14579, at paras. 28-29, 37, the court held that costs must be fair and reasonable, and consistent with the reasonable expectations of the parties.
[10] I have considered the factors set out in Rule 24 (12) of the FLRs which reads as follows:
24(12) In setting the amount of costs, the court shall 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
[11] Rule 24(5) provides criteria for determining the reasonableness of a party's behaviour in a case (a factor in clause 24(12)(a) (1) above). It reads as follows:
DECISION ON REASONABLENESS
(5) In deciding whether a party has behaved reasonably or unreasonably, the court shall examine,
(a) the party's behaviour in relation to the issues from the time they arose, including whether the party made an offer to settle;
(b) the reasonableness of any offer the party made; and
(c) any offer the party withdrew or failed to accept.
Who was Successful on the Motion?
[12] The applicant submits that the respondent was not successful on at least three issues determined at the motion, namely, (a) he sought an order that the applicant attend a parenting course, which was not ordered by me; instead I ordered that both parties retain a mental health professional to assist them in co-parenting after separation; (b) he sought an order that $100,000 be released from the matrimonial home net proceeds of sale to him, which motion was dismissed by me without prejudice to his right to return this motion; and (c) he opposed the appointment of the OCL, which I did order.
[13] The respondent disagrees with the applicant’s assessment of his lack of success on these issues and submits that:
a. Prior to the hearing of the long motion, the respondent requested that the parties engage in joint professional assistance in co-parenting and to discuss the impact on involving the children in adult conflict, on both July 7, 2021 and July 27, 2021. The applicant refused to do so. In my Endorsement, I referred to the fact that applicant acknowledged in her motion materials that the respondent had made this suggestion and she was not opposed but the respondent had ignored her request to obtain a Voice of the Child report (see para. [40]); and
b. The issue of the OCL was not a “key issue” that was determined on the motion. The applicant sought the involvement of the OCL to conduct a Voice of the Children’s report and only sought a s.112 custody and access assessment as alternative relief in her Notice of Motion. I declined to order a Voice of the Child report.
[14] I agree that the applicant was not successful in obtaining an order that $100,000 be released to him from the net sale proceeds from the matrimonial home however, he was permitted to return that motion on a more fulsome record. The respondent was successful in obtaining orders on the key issues in the case, namely, for (a) equal parenting time; (b) joint decision-making authority; (c) the involvement of a mental health professional; (d) the requirement that both parents actively facilitate the other parent’s parenting time; and (e) the continuation of the children’s attendance at their schools. On the main issues to be determined on the long motion, therefore, the respondent was successful and, as such, he is presumptively entitled to some costs.
Factors to be considered
Importance, complexity, and difficulty
[15] The motion was of importance to both parties. The applicant was insistent in her position that supervised access was necessary because of her alleged concern that the respondent would abduct the children to Iran given that Iran was not a party to the Hague Convention. The motion was equally, if not more important to the respondent, who was seeking to have meaningful parenting time with the children that was not supervised and who had to refute the applicant’s sweeping allegations that he would abduct the children to Iran.
Written Offers to Settle
[16] The applicant made one offer to settle on July 20, 2021, offering the respondent unsupervised access on alternate weekends, from Friday, after school to Monday morning (6 overnights a month); 100% of the children’s Christmas school holiday; and the last three weeks of the children’s summer holiday with them. Her offer proposed that decision-making responsibility was to be determined by settlement or a trial judge, if necessary. No costs were to be payable if the respondent accepted her offer within 7 days, failing which, the applicant would be entitled to her partial indemnity costs from the date of her offer to the date of acceptance. The applicant’s offer to settle expired on August 9, 2021. She then withdrew it on August 2, 2021.
[17] Seven days later when the respondent did not accept the applicant’s offer to settle, she served her notice of motion seeking an order that the respondent have only four hours of supervised time with the children, at a supervised access centre. The respondent advised the applicant that he would be relying on her offer as a sign of her bad faith on this motion.
[18] The respondent served an offer to settle on July 21, 2021, seeking to implement a shared parenting schedule. As part of this offer, the respondent proposed five different shared parenting schedules: 1) week on/week off; 2) week on/week off, with the children going to the non-resident parent Tuesday overnight to Wednesday morning; 3) week on/week off, with the children going to the non-resident parent from Monday, after school to Wednesday morning; 4) 2/2/5/5 schedule, with the children spending Monday to Wednesday morning with the applicant, Wednesday to Friday morning with the respondent, and alternate weekends; and 5) 2/2/5/5 schedule, with the children spending Monday to Wednesday morning with the respondent, Wednesday to Friday morning with the applicant, and alternate weekends. The offer was open without costs until July 23, 2021, after which costs were to be agreed upon. The applicant did not respond to this offer to settle.
[19] On August 6, 2021, the respondent made 7 further offers to settle. The 1st and 2nd offers to settle was the respondent’s proposal that the parties share joint decision-making authority for each child; the 3rd offer to settle was a proposal that both parents actively facilitate the other parent’s parenting time only; the 4th offer to settle was a proposal for the applicant to attend a parenting court to assist her in understanding the impact of placing the children in a loyalty bind; the 5th offer to settle proposed that the respondent to receive the sum of $45,000 from the matrimonial home proceeds on a without prejudice basis to how this sum was characterized; the 6th offer to settle was a proposal for the oldest child to attend Lawrence Park Collegiate; and the 7th offer to settle was a proposal for the youngest child to attend John Ross Robertson Junior Public School. These offers were clearly made to narrow the issues before the court on the long motion.
[20] The respondent beat his offers to settle on the fundamental issues as follows, except with respect to the release of matrimonial home sale proceeds:
a. I ordered a week on/week of schedule with the children spending time with the non-resident parent from Tuesday, after school to Wednesday morning. He made this offer to settle on July 21, 2021;
b. I ordered joint decision-making authority. He made this offer on August 6, 2021;
c. I ordered both parents to actively facilitate the parenting time of the other parent. He made this offer on August 6, 2021;
d. I ordered both parents to retain mental health professional to assist them with co-parenting after separation, communication and conflict. He made the offer for the applicant to attend such a parenting course on August 6, 2021 and he made submissions on the hearing of the motion that he would consent to attending same.
e. I ordered the oldest child to return to Lawrence Park Collegiate. He made this offer on August 6, 2021;
f. I ordered the youngest child to return to John Ross Roberson. He made this offer on August 6, 2021.
[21] Had the applicant accepted any of the five joint parenting regimes set out by the respondent in his July 21st, 2021 offer to settle, the costs incurred following this date could have been avoided. In the respondent’s reply costs submissions he provides that only a fraction of his legal fees were incurred by July 20, 2021 (the day prior to his first offer to settle), namely, the sum of $6,292.
[22] The respondent submits that he is entitled to his full recovery costs from the date his offer was made, given that he obtained an order that was as favourable as his offer, pursuant to r.18(14). I agree.
[23] Rule 18(14) provides as follows:
COSTS CONSEQUENCES OF FAILURE TO ACCEPT OFFER
(14) A party who makes an offer is, unless the court orders otherwise, entitled to costs to the date the offer was served and full recovery of costs from that date, if the following conditions are met:
If the offer relates to a motion, it is made at least one day before the motion date.
If the offer relates to a trial or the hearing of a step other than a motion, it is made at least seven days before the trial or hearing date.
The offer does not expire and is not withdrawn before the hearing starts.
The offer is not accepted.
The party who made the offer obtains an order that is as favourable as or more favourable than the offer. O. Reg. 114/99, r. 18 (14).
Lawyer’s rates
[24] The husband’s lawyer, Belinda Rossi, is a 2007 call. Her hourly rate is $515.00. She worked with an associate lawyer, Hannah Rich, who is a 2019 call with an hourly rate of $278.69; an articling student, with an hourly rate of $210; and a law clerk, with an hourly rate of $175.
Time properly spent on the case
[25] The applicant attached her Bill of Costs and submits that she incurred fees of $23,014 for the same motion and her counsel spent a total of 48.6 hours preparing for the long motion. Again, the applicant submits that the time spent by Ms. Rossi is excessive since it amounted to a total of 170.8 hours, which is about 3 ½ times the hours spent by her counsel. It is her position that the time spend by Ms. Rossi and other members of her office is “so grossly excessive as to be obvious overkill” and that, at most, the Court should order her to pay costs in the sum of $20,000.
Costs Incurred after the Respondent’s Offer to Settle
[26] My review of the respondent’s Bill of Costs demonstrates that after the date of the respondent’s offer to settle (July 20, 2021), a further 46.1 hours of time was incurred by Belinda Rossi, which equates to $23,741.50; a further 86.1 hours of time was incurred by Hannah Rich, which equates to $23,995.21; a further 7.9 hours was incurred by an articling student, which equates to $1,659; and a further 13.3 hours of time was incurred by a law clerk, which equates to $2,327.50. This totals $51,723.21 of the $66,070.17 time charged to the respondent, (not including HST).
[27] I have reviewed the dockets attached to the respondent’s Bill of Costs, particularly those dockets entered after the July 20th offer to settle. There are a number of days when both Ms. Rossi and Ms. Rich billed extensive hours for meetings and preparation that took place internally. Where there were duplicate dockets for both Ms. Rossi and Ms. Rich for meetings, I have discounted Ms. Rich’s time by a total of 27.7 hours, as follows:
a. On July 26, 2021, Ms. Rich’s time is reduced from 8.0 hours to 5.6;
b. On July 27, 2021, Ms. Rich’s time is reduced from 7.0 hours to 4.0 hours;
c. On July 29, 2021, Ms. Rich’s time is reduced from 10.0 hours to 5.3 hours;
d. On July 30, 2021, Ms. Rich’s time is reduced from 11.0 hours to 6 hours;
e. On August 3, 2021, Ms. Rich’s time is reduced from 7.6 hours to 5 hours;
f. On August 4, 2021, Ms. Rich’s time is reduced from 7.0 hours to 3 hours; and
g. On August 7, 2021, Ms. Rich’s time is reduced from 14.0 hours to 8.0 hours.
[28] These reductions translate into Ms. Rich’s time being reduced from 86.1 hours to 58.4 hours (a reduction of 27.7 hours), which equates to $16,275.50 (58.4 x $278.69) in legal fees before HST, instead of $23,995.21 referred to in paragraph [29] above[^1]. Therefore, the total legal fees incurred from July 20, 2021 onward, for which the respondent seeks full recovery pursuant to r.18(14), amount to $44,003.50, not $51,723.21 of the $66,070.17 charged to the respondent in total.
[29] Except as adjusted by me above, I find that the costs incurred by the respondent after the date of his offer to settle were reasonable in the circumstances of this case. They were also proportional to what was at stake and to the applicant’s reasonable expectation as to what costs she might face if she was unsuccessful. I accept the record of time set out in the applicant’s Bill of Costs. It is also important to note that the respondent required a translator for each step given his lack of proficiency with the English language.
Scale of Costs to be Awarded which Pre-dated the Husband’s Offer to Settle
[30] There is no general approach in family law of “close to full recovery costs”: Beaver, at para. 11. Rather, full recovery is only warranted in certain circumstances, such as bad faith under r. 24(8), or beating an offer to settle under r. 18(14): Beaver, para. 13.
[31] The FLRs do not explicitly provide for costs on either a partial or substantial indemnity scale. Rule 24(8) refers to “costs on a full recovery basis,” where a party has acted in bad faith. 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.
[32] 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 FLRs. 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 FLRs 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.
[33] 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 he may face if he is unsuccessful. In appropriate circumstances, unreasonable behavior will result in a higher award of costs.
Reasonableness
[34] Rule 24(4) of the FLRs explicitly authorizes the use of costs orders to express the court’s disapproval of a litigant’s unreasonable conduct. It provides:
24.(4) Despite sub-rule (1) [which provides that a successful party is presumed to be entitled to the costs of a motion], 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.
[35] In determining reasonableness, Rule 24(5) of the FLRs, sets out what ought to be considered and is referred to above in paragraph [11].
[36] In my Endorsement, I made the following findings about the applicant’s position on the motion and her conduct:
a. “The wife’s concern that the husband was planning to abduct the children to Iran was unfounded.” (see para. [74]);
b. “The wife did not commence her proceedings by bringing an urgent motion to address her abduction concerns but, rather, sought to relocate with the children.” (see para. [74e.]);
c. The wife alleged that she and her parents were highly concerned the husband would abduct the children and take them to Iran in October 2020 but she waited three months to issue an Application and when she did, she failed to seek any relief indicating these abduction concerns. (see para. [74f.]);
d. “The wife does not value the husband’s time with the children or his parenting role.” (see para. [79]).
e. “I have concerns about the wife’s inability to respect the husband’s parenting role. I also have serious concerns about the wife belittle and demeaning the husband in the present of the children….Of the two parents, the husband respects the wife’s parenting role and indicates a willingness to promote and foster the children having meaningful relationships with both parents. The wife, on the other hand, has demonstrated conduct that could be seen as alienating.” (see para. [85]); and
f. I was truly concerned about the wife placing the children in the middle of the parental dispute and exposing them to conflict. (para. [76]).
[37] It is clear based on my findings that the applicant engaged in unreasonable conduct. She submits that the court ought not to find, however, that she engaged in bad faith. The respondent disagrees. He submits that the applicant made bald, sweeping claims against him in an attempt to sever the status quo of joint parenting and by seeking an order where the children would only spend four hours of supervised access with the husband.
[38] While the issues on the long motion were not overly complex, an initial issue was raised at the outset of the motion regarding the admissibility of an affidavit the applicant filed from an expert in Iranian law, which required an oral ruling at the outset of the motion and made the motion more complex and difficult. The applicant filed a CV and Acknowledgement of Expert’s Duty from a lawyer in Iran and failed to disclose her prior working relationship with the expert; something about which she clearly knew was not appropriate given that the applicant is a lawyer. Further, the abduction allegations made by the applicant caused extensive material to be filed by both parties, making the matter more extensive and costly.
[39] In terms of the third-party affidavits, while I found them not to be helpful and self-serving, the respondent had no choice but to address each affidavit which involved his counsel making contact with each affiant; gathering independent evidence to disprove statements; and having one of the applicant’s affiant provide a clarifying affidavit to the affidavit the applicant filed on her behalf that was misleading, all of which caused his legal fees to increase significantly.
[40] Bad faith is not simply bad judgment but rather it implies the conscious doing of a wrong because of dishonest purpose or moral obliquity: Nairn v. Lukowksi, 2002 78091 (ONSC), at para. 10. I do not find that the applicant’s conduct amounted to bad faith, however, her unreasonable conduct raised serious allegations that increased the respondent’s legal costs considerably as he was required to refute the applicant’s bald, sweeping claims, for which she provided no reliable or credible evidence. I find that the applicant’s unreasonable behaviour increased the respondent’s legal fess unnecessarily.
CONCLUSION AND ORDER
[41] In light of the extent of the respondent’s success on the motion; the reasonableness and proportionality of the work performed by the respondent’s counsel, subject to the reduction I made for duplication of costs; the fact that the respondent offered to resolve this matter and is entitled to his full recovery of costs in the sum of $44,003.50 and costs on some lesser scale prior to the date his offer to settle was served; the fact that the applicant should have expected to pay costs, if the respondent succeeded on the motion, an order that the applicant pay costs to the respondent, fixed in the sum of $50,000, inclusive of fees, disbursements and HST is reasonable and fair in the circumstances.
[42] Accordingly, this Court orders that within 30 days, the applicant, Marjan Atashi Golestan, shall pay costs of the motion to the respondent, Vahid Ebrahimzadeh, in the amount of $50,000 inclusive of fees, disbursements and HST.
M. Kraft, J.
Date Released: September 21, 2021.
[^1]: Note this is Ms. Rich’s time spent after the date of the July 20, 2021 offer to settle only.