COURT FILE NO.: FS-19-30 (Owen Sound) DATE: 2022 04 11 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Codey Baker Duff Osborne, Applicant AND: Jennifer Robin Shevalier, Respondent
BEFORE: Justice J.R. Sproat
COUNSEL: R.H. Thomson, for the Applicant D. Cahill, for the Respondent
COSTS ENDORSEMENT
Overview
[1] This family law trial took place over six days. The parties made written costs submissions.
[2] A brief summary of the principal issues and their disposition is as follows:
a) I accepted Mr. Osborne’s position that there were no grounds for an unequal division of net family property.
b) Ms. Shevalier valued chattels in the possession of Mr. Osborne at $32,332. I concluded they had a value of $16,306.
c) I accepted Mr. Osborne’s position, in preference to Ms. Shevalier’s position, respecting a number of elements of the net family property calculation.
d) I accepted Ms. Shevalier’s evidence that she has extensive health concerns and limitations such that she can only work approximately 16 hours a week. As such, I concluded that her annual income for support purposes was $23,000. I concluded that Mr. Osborne’s annual income was $135,000.
e) I concluded that Ms. Shevalier had no entitlement to retroactive spousal support.
f) I found that Mr. Osborne should pay spousal support of $1,680 per month from January 1, 2022 until December 31, 2025, being seven years from the date of separation.
[3] As set out in the final order Mr. Osborne owed Ms. Shevalier an equalization payment of $11,919.49.
Offers to Settle
[4] On October 28, 2019, in anticipation of Ms. Shevalier purchasing the matrimonial home, Mr. Osborne offered to transfer to Ms. Shevalier his one-half of the equity in the home in full and final settlement.
[5] On June 23, 2020 Mr. Osborne offered to pay spousal support of $1,365 per month to December 31, 2024, plus $12,000 as an equalization payment. (Mr. Osborne in fact paid $1,875 per month in spousal support from January 1, 2020 to December 31, 2021.) Mr. Osborne was thereafter ordered to pay $1,680 in spousal support to December 31, 2025, which would total $80,640. (48 months x $1,680 = $80,640)
[6] On December 2, 2020 Ms. Shevalier offered to settle for a lump sum of $80,000 plus spousal support of $2,200 per month for nine years from the date of separation.
[7] On October 19, 2021 Mr. Osborne offered to settle on the basis of $1,460 per month spousal support to December 31, 2024, plus $10,000 as an equalization payment with each party bearing their own costs.
Analysis
[8] Mr. Osborne seeks costs, on a partial indemnity basis, of $59,792.10 for fees, $2,130.13 for disbursements plus HST, which totals $69,739.08. The partial indemnity rate is $300 per hour. Almost all of the total time docketed was for Mr. Thomson. He docketed approximately 195 hours.
[9] The position of Ms. Shevalier is that success was divided and there should be no order as to costs.
[10] Ms. Shevalier submits that her former counsel did not bill her until after trial and so she did not appreciate the cost consequences of going to trial. Further, at no time did she sign a retainer agreement or receive a letter setting out the hourly rate to be charged or an estimate of the cost of proceeding to trial and the possible cost consequences at trial.
[11] If all of that is correct, then Ms. Shevalier was not well served by her former counsel. Certainly, counsel have an obligation to advise clients of the basis upon which they are going to be billed, the costs being incurred and the exposure to pay costs to the other side. I emphasize, however, the word “if”. There is no affidavit evidence in this regard and Ms. Shevalier’s former counsel has not had an opportunity to respond. In any event, I cannot deny Mr. Osborne an appropriate costs award because of a failure of Ms. Shevalier’s former counsel. As such, I did not request actual evidence from Ms. Shevalier.
[12] Ms. Shevalier also submits at paragraph 33 of her submission that certain costs sought relate to steps in the proceeding for which no costs were awarded or reserved to the trial judge.
[13] Ms. Shevalier is correct that on a partial indemnity basis costs are claimed for the December 2, 2020 Settlement Conference ($1,536) at which Shaw J. awarded $750 in costs; the June 24, 2021 motion at which McSweeney J. decided there should be no costs ($1,608): and the August 7, 2019 case conference at which Doi J. endorsed that there be no order as to costs ($1,899.62). This totals $4,043, which I agree should be deducted from the amount claimed. The partial indemnity amount is, therefore, reduced to $55,749 ($49.792 - $4,043 = $55,749).
[14] An additional $6,630 in partial indemnity costs relates to a motion by Mr. Osborne’s to compel the sale of the matrimonial home. The endorsement of Bielby J. refers to Mr. Osborne having a compelling argument, but he decided to adjourn the motion for at least 60 days. The principal reason appears to be that Ms. Shevalier wanted to purchase the matrimonial home and she deposed that she had received bank approval. In fact, it turned out that was not correct. The motion was ultimately resolved on consent but in the absence of any indication of an agreement as to costs, I find it appropriate that they be considered as part of the overall costs claimed at trial.
[15] I must also take into account that a considerable amount of time at trial, and presumably pre-trial preparation, was devoted to Ms. Shevalier’s health and ability to work. While admittedly rough, I estimate 25% of trial time was devoted to this. Ms. Shevalier was successful on that issued. To recognize that I would reduce the amount claimed by Mr. Osborne by 25% to recognize that he should not be compensated for litigating this issue. I would, therefore, notionally, discount the amount claimed by Mr. Osborne to ($55,749 x 75% = $41,811).
[16] While there was divided success, I have to take into account the reasonableness of the offers made. The following calculations are to get a rough sense of the reasonableness of the offers. In determining costs, it is not necessary to make precise calculations in this regard.
[17] Ms. Shevalier, on December 2, 2020 offered to settle for a lump sum of $80,000 plus spousal support of $237,600 (108 months x $2,200 = $237,600.) This totals $317,600.
[18] On October 19, 2021 Mr. Osborne offered to settle for a $10,500 lump sum plus $55,480 (38 months x $1,460). To better compare the two positions, I note that Mr. Osborne also paid approximately $20,625 in support from December 2020 to October 2021. (11 months x $1,875). These amounts total $86,105 ($10,000 + $55,480 + $20,625).
[19] So, as of December 2020, Ms. Shevalier wanted to settle for an additional $317,600. Mr. Osborne, taking into account what he paid to October 2021, and his offer at that time was prepared to pay $86,105.
[20] I then compare these amounts to what Ms. Shevalier had received from December 2020, and what I determined Ms. Shevalier was entitled to:
a) $1,875 per month from December 2020 to December 2021 being $20,625 (13 x $1,875 = $24,375)
b) $1,680 per month from January 2022 to December 2025 being $80,640 ($1,680 x 48 = $80,640)
c) $11,919 as an equalization payment.
[21] These amounts total $116,934.
[22] On this, admittedly rough calculation, Mr. Osborne’s offer fell about $30,000 short of what I decided. Ms. Shevalier’s offer was approximately $204,000 more than I decided.
[23] These calculations lend considerable force to Mr. Thomson’s argument that Ms. Shevalier took an unreasonable approach and that this made it impossible to settle.
[24] In arriving at a figure for costs, I also take into account:
a) $6,630 of the partial indemnity time claimed was in relation to the motion for the sale of the matrimonial home. This motion should not have been necessary. The motion was resisted on the basis that Ms. Shevalier had a mortgage commitment which she did not.
b) There was divided success on the amount and duration of spousal support and as to the value of certain chattels.
c) Ms. Shevalier’s position on settlement was extreme, and if she had been more reasonable it is likely that a settlement could have been achieved.
[25] In the result, I conclude that it is fair and reasonable in all the circumstances that Ms. Shevalier pay Mr. Osborne costs fixed in the amount of $25,000.