Court File and Parties

Court File No.: FC-20-2071 Date: 2022/05/10 Ontario Superior Court of Justice

Between: Taras Volgemut, Applicant And: Ashlee Janna Decristoforo, Respondent

Counsel: Michael J. Stangarone, Vivian Li Merklinger and Ian Vallance, for the Applicant Peter Hearty, for the Respondent

Heard: In writing.

Costs Decision

Audet J.

[1] From October 11 to October 29, 2021, I heard the trial in this matter which dealt with the single issue as to whether Ontario should assume jurisdiction over the parties’ three-year-old child who was removed from her parents’ residence in Dubai, UAE, by her mother in December 2020 without her father’s consent.

[2] Although this was the single legal issue raised by this proceeding, it was nothing but simple or expeditious. The trial which ultimately concluded this legal matter was preceded by a series of motions and court appearances (more than 20 of them, by my account) dealing with a vast array of procedural, substantial and enforcement issues. My trial decision which was released on November 8, 2021 (2021 ONSC 7382), provides a detailed account of all the steps that the parties went through over the course of eleven (11) months which culminated into this three-week trial. I will not repeat them here.

[3] In the end, I concluded that Ontario did not have jurisdiction over the parties’ child, and I ordered her return to Dubai.

The Parties’ Position

The father

[4] The Applicant father seeks his costs of this Application on a full recovery basis, in the amount of $733,894.13 (including fees, disbursements, and H.S.T.). This amount does not include those steps in the proceeding for which costs were already adjudicated upon by the presiding judge. It does include, among other things, the following:

• Legal fees for the trial in the mount of $372,042.33, inclusive of HST but excluding disbursements and experts’ invoices;
• Costs for the preparation of the trial set to proceed in May and June 2021, but which had to be adjourned at the Respondent mother’s request;
• Costs for the motion for interim parenting time heard by myself on July 5, 2021, which were reserved;
• Costs for the attendance before Justice Doyle on January 5, 2021 (date at which the father’s motion for the immediate return of the child to Dubai was to proceed, but ultimately adjourned) which were reserved to the trial judge;
• Costs for all appearances before me throughout the course of the summer 2021, brought by the father in the context of his ongoing efforts to enforce my July 5, 2021 Order for interim parenting time;
• Expert fees in the amount of $149,323.20.

[5] The father takes the position that an award of cost on a full recovery basis is justified in this case as a result of the mother’s bad faith conduct, her repeated and ongoing breaches of court orders and her attempts to thwart the father’s court ordered parenting time, which delayed the proper resolution of this matter and increased costs. He also points out to the mother’s shifting position which extended the length of the trial, the unreasonable positions that she took, and the false and escalating allegations of abuse on her part to support her positions in this proceeding and gain an advantage in this litigation. Finally, the father submits that he made three offers to settle which, if accepted by the mother, would have been more beneficial to her than the outcome she achieved at trial. The first Offer to Settle was made on February 23, 2021, roughly two months after this legal proceeding was commenced.

The mother

[6] The mother takes the position that it would be appropriate for the Court to exercise its discretion and have the parties bear their own costs. She submits that the issue to be tried was a binary-option, in the sense that there was no middle ground available as either the court would exercise jurisdiction or it would not. Ultimately, there was a real triable issue to be resolved by the court, and no possibility of a real winner.

[7] While the mother acknowledges that her actions following my July 2021 Order were unreasonable, in her submission they did not amount to bad faith. Having been found in contempt of court already, imposing costs would be to further punish her for the same wrongful behavior. The mother submits that it is the father who engaged in bad faith, by hiring private investigator and disclosing nude photographs of the mother to the court.

[8] The mother takes the position that it the father’s changing trial strategy which resulted in the April trial being adjourned to June, resulting in significantly higher legal fees for the mother, the loss of her counsel, and an unfortunate series of events that would not have happened had the trial been held in April as originally scheduled.

[9] Finally, the mother submits that the father’s costs are excessive.

Legal Framework

[10] Cost rules are designed to foster three fundamental purposes (a) to indemnify successful litigants for the cost of litigation; (b) to encourage settlements, and (c) to discourage and sanction inappropriate behaviour by litigants. As noted by the Ontario Court of Appeal in Beaver v. Hill, 2018 ONCA 840, two touchstone considerations must be applied to costs decisions: 1) proportionality, and 2) reasonableness. Pursuant to Rule 24(11) of the Family Law Rules, O.Reg. 114/99 as am. (“the Rules”), a judge fixing costs shall consider the importance, complexity or difficulty of the issues, the reasonableness or unreasonableness of each party's behaviour in the case, the lawyer’s rates, the time properly spent on the case, expenses properly paid or payable, and any other relevant matter. Pursuant to Rule 24, a Court has discretion to award an amount of costs that is just in all of the circumstances after taking into account the factors set out in Rule 24(11).

[11] Costs can be used to sanction behaviour that increases the duration and expense of litigation or is otherwise unreasonable or vexatious. In short, it has become a routine matter for courts to employ the power to order costs as a tool in the furtherance of the efficient and orderly administration of justice (British Columbia (Minister of Forests) v. Okanagan Indian Band, [2003] 3 S.C.R. 371, 2003 SCC 71 at para. 25).

Analysis

[12] The father was successful at trial. He was also successful at the July 2021 motion for interim parenting time, and in all court appearances following that motion brought for the purpose of enforcing my July 2021 Order. On that basis, he is presumptively entitled to his costs on a partial indemnity basis for all those steps.

[13] While I agree that the mother’s conduct following my July 2021 interim decision until the child’s apprehension by the Gatineau police had all of the indicia of bad faith, I disagree that her conduct prior to the June 2021 motion hearing, or during the trial, can be characterized as bad faith.

[14] Bad faith has been described as a behavior carried out with the intent to inflict financial or emotional harm on the other party or other persons affected by the behavior, to conceal information relevant to the issues or to deceive the other party or the court. In short, the essential components are intention to inflict harm or deceive (S. (C.) v. S. (M.), [2007] O.J. No. 2164, at para. 17, aff’d by the Court of Appeal in 2010 ONCA 196).

[15] In the present case, I concluded on more than one occasions that the mother had intentionally created the perception that she would likely comply with my July 2021 Order so that the father would not take further pre-emptive steps to force her compliance. I concluded that the mother misled the father and the court in an effort to thwart my July 2021 orders (there were more than one made after the July 5 Order), and delay the father’s court ordered parenting time, in the hope that it would ultimately become impossible or impractical for the parenting time to occur at all (in light of the forthcoming trial in October).

[16] After hearing all the evidence at trial, I found that the mother and her family members had conspired together to thwart my July 2021 orders while the mother was a fugitive from the law evading justice. The mother’s conduct in preventing the court-ordered travel, deceiving the father and the court, evading justice and hiding in hotels with the child without regard for the child’s best interest, can only be described as bad faith.

[17] However, prior to my July 2021 orders, there was nothing in the mother’s conduct in this litigation that could be described as bad faith or unreasonable. Although ultimately unsuccessful, the mother had a legitimate claim to argue before the court, the issues raised in the case were of the utmost importance for both parties, and the steps she took in the litigation to advance her claims were reasonable in the circumstances. Similarly, I see nothing unreasonable in the litigation strategy adopted by the mother at trial. Counsel did the best he could, having been retained only weeks before, to narrow down the issues and the evidence for trial, and he made legal concessions which were sensitive to the quickly evolving law on the issue before the court at the time (on October 5, 2021, one week before trial, the Ontario Court of Appeal issued a stay of its September 14, 2021 order based on the minority reasons of Justice Lauwers N. v. F., 2021 ONCA 688, and pending an application for leave to appeal to the Supreme Court of Canada). While ultimately, that goal got derailed by the nature of the mother’s own testimony, this is the nature of litigation and I do not find that this supports an award of cost on a full indemnity basis.

[18] Subject to the rest of my analysis below, I am of the view that, based on his ultimate success in the July 2021 motion for interim parenting time and at trial, the father is entitled to his costs on a partial indemnity basis for all work completed prior to and in the context of the June 2021 motion, and for all work related to the preparation for and attendance at the October 2021 trial. I am also of the view that the father is entitled to his costs on a full recovery basis for all steps taken by him to enforce my July 2021 orders, being all work required between July 2021 and September 2021 (when the child was finally removed from the mother’s care in Gatineau, Quebec and placed in the father’s care in Turkey).

[19] The father made three formal offers to settle in this case, all of which met the criteria set out in Rule 18. The mother submits that the ultimate issue to be decided by the court, whether Ontario had jurisdiction or not, was a binary-option and there was no middle ground available in terms of settlement options. In her view, there is nothing that can be read into the father’s offers to settle because all his offers required the same outcome, being that the child would not remain in Canada.

[20] I disagree with the mother on this point. While from the mother’s perspective settlement options were reduced to only two, being the child remaining in Canada or leaving Canada, from the father’s perspective settlement options were multiple and there was indeed much middle ground available for settlement, outside of the binary options presented by the mother. His settlement proposals included exploring the possibility of relocating the family outside of Dubai, agreeing to the child having more than one residence, and providing the mother with significant financial resources allowing her to live independently from the father, with the child in her primary care, in Dubai or elsewhere in the world.

[21] I find that all three offers to settle made by the father would have provided the mother with a much more favorable result than the outcome she obtained at trial. In his first offer, dated February 23, 2021, the father proposed that the child would return to Dubai and primarily reside with her mother. He would pay for the child, the mother and the maternal grandmother’s costs to travel to Dubai, he would pay for their living expenses in Dubai, he would pay temporary without prejudice support as well as medical insurance, and he would pay the mother’s reasonable legal fees incurred up to March 1, 2021 in the Ontario litigation.

[22] The father’s second and third offers to settle made on June 6 and June 13, 2021, were equally advantageous to the mother and provided her with various options depending on whether the mother was prepared to consider a reconciliation or not. The first offer anticipated the mother and child’s return to Dubai or another country agreed upon by the parties. The second dealt with the adjournment of the June trial if the mother agreed to travel to Turkey with the child to allow the father to have parenting time with the child. The second part of the third offer contemplated the child’s immediate return to Dubai or Turkey with the mother, and both offers would have provided the mother with significant financial advantages and support for and after relocating with the child (including her having her own home fully paid for by the father). The June 13, 2021 Offer was never withdrawn.

[23] The above supports a finding that the father should be entitled to full recovery costs from the date of his June 13, 2021 Offer to Settle.

[24] Even where the "full recovery" provisions of the Rules are triggered – either by an offer which meets Rule 18(14) requirements, or by a finding of bad faith – quantification of costs still requires an overall sense of reasonableness and fairness (Goryn v. Neisner 2015 ONCJ 318). The Rules do not require the court to allow the successful party to demand a blank cheque for their costs (Slongo v Slongo 2015 ONSC 3327), and it retains a residual discretion to make costs awards which are proportional, fair and reasonable in all the circumstances.

[25] I am cognizant of the fact that this trial, which was originally scheduled to be heard in April 2021, had to be adjourned for the first time because of the change in the father’s position that if Dubai did not have jurisdiction, Germany did. That changed position, which the father ultimately abandoned, resulted in the first adjournment of the trial and delays which significantly increased the mother’s legal fees.

[26] This said, the trial had to be adjourned a second time as a result of the mother’s counsel being removed from the record days before the trial was set to begin. This resulted in equally increased costs for the father, given that all trial preparation had been completed, and he was set to commence the trial.

[27] I have considered the father’s Bill of Costs, which was detailed and extensive. It is undisputed that the matters raised by this legal proceeding were of extreme importance to both parties. The legal and factual issues presented by the case were very complex and required skilled counsel and experts specialized in their respective fields. In those circumstances, it was reasonable for the parties to hire very experienced legal counsel whose hourly rates were high. I take no issue with the hourly rate charged by the various counsel who worked on this file on behalf both parties.

[28] This said, and while it was open to the father to retain an entire team of legal professionals to represent him in this proceeding (including two very experienced counsel from different law firms – one in Toronto and one in Ottawa – each supported by several junior counsel and law clerks), I am not prepared to impose this choice on the mother, who did not have the financial means to do the same. The mother initially retained one very experienced counsel who represented her until the June 2021 trial was adjourned. Thereafter, she alternated between being self-represented and being represented by counsel, before finally hiring Mr. Hearty, who skillfully represented her for the purpose of the trial only.

[29] The hours spent by Mr. Hearty preparing for and attending the three-week trial were roughly the same as those spent by Mr. Stangarone, lead counsel for the father, for the same work. I recognize that the two senior lawyers retained by the father did not duplicate all their efforts (they appear to have split many areas of responsibilities between them), but their joint appearance on all court hearings – for which they both charged their time – resulted in significantly higher legal fees, including for the entire trial which lasted three weeks.

[30] What is not included in the mother’s Bill of Costs are the significant legal fees she must have incurred while represented by her former counsel for the period between December 2020 and April 2021, when she was removed as counsel of record for the mother. The legal fees incurred by the mother while represented during the events which took place following my July 2021 orders were also not disclosed.

[31] I have also considered the mother’s ability to pay a cost order. In particular, I have given a lot of thought to the impact that a significant cost award might have on the mother’s ability to travel abroad to have parenting time with her daughter in the future, and her ability to retain counsel in Dubai (or elsewhere) to formalize the parties’ parenting regime. This, in particular, gave me significant pause. Although they are not specified in Rule 24(11) as factors in determining costs, the financial means of the parties, their ability to pay a cost order and the effect of any costs ruling on the parties and the children of the family are also relevant considerations in reaching a determination on the issue of costs (Fyfe v. Jouppien, 2012 ONSC 97).

[32] Nonetheless, and as noted by Justice Sherr in Brown v. Pulley, 2015 ONCJ 238, at para. 24, the courts in wrongful removal cases must send a strong message to parents that resorting to self-help remedies and wrongfully removing children from their habitual residence is unacceptable and will not be condoned. The mother’s behavior following my July 2021 Order, where she deceived the court and absconded with the child was callous, destructive and resulted in extraordinary costs to all, both financial and emotional. The mother ought to have known that the behavior she engaged in would result in serious cost consequences, over and above a finding of contempt.

[33] Ultimately, I was informed by existing caselaw on cost in relation to litigants with limited financial means. In Snih v. Snih, the court held that a party’s limited financial circumstances will not be used as a shield against any liability for costs but will be taken into account regarding the quantum of costs, particularly when they have acted unreasonably and are the author of their own misfortune. In Takis v. Takis, [2003] O.J. No. 4059 (S.C.J.) the court found that the respondent’s lack of income and assets, though a relevant consideration, could not be used as a shield in unnecessary litigation.

[34] In Mark v. Bhangari, 2010 ONSC 4638, at para. 10, the court held that:

“Parties cannot expect to be immune from an order of costs based on their limited financial resources. If this were the case, parties would be free to conduct litigation as they wished without fear of reprisal in the form of adverse cost orders and this would be contrary to the philosophy and requirements of the Rules ”

[35] The mother’s ability to pay alone cannot override the other factors in Rule 24(12). I adopt as mine the following remarks by Justice Akbarali in Veneris v. Koh Veneris, 2018 ONSC 4164, at para. 63, in which she says:

“While the appellant argued that he did not have the ability to pay, there is evidence in the record that is inconsistent with this submission. In any event, the costs of these parties’ very expensive proceedings have to come from somewhere. The arbitrator explained the reasons why she concluded the costs award in favour of the respondent was appropriate. Her reasons are well-explained and there is ample basis for them in the record. It would not be just to force the respondent to incur costs for the appellant’s counterproductive litigation positions because he says he cannot afford the costs himself. He should not be permitted to litigate in this manner without consequence. However, these consequences are not punitive; rather they are the natural consequences of the decisions he has taken.”

[36] The father’s full recovery costs from February 23, 2021, onwards, inclusive of H.S.T., amount to $457,273.71 (for both counsel who worked on this file, but not including disbursements). The legal fees he incurred prior to February 23, 2021, inclusive of H.S.T., amount to $19,176.10. For the reasons explained above, I would discount the father’s costs by roughly 35% to account for the fact that two lawyers worked on his file throughout.

[37] In addition, the father paid expert fees and disbursement in the amount of $257,444.33, inclusive of H.S.T. No justification is provided for many of the disbursements claimed by the father. As examples:

• Inquisive Intel invoices dated March 18 and April 9, 2021, totalling more than $12,500. I have no idea why private investigation services would have been necessary at that time in the proceeding (although I am in complete agreement that the cost of hiring private investigators to locate the mother when she went in hiding with the child in August 2021 were wholly appropriate);
• Expert report of Dr. Weinberger, totaling almost $7,000. His report was ultimately not used and I am not aware of what his expert’s opinion related to;
• Gilmour Psychological Services, totaling more than $6,000;
• More than $25,000 paid to other law firms (Murray Ages, Soloway Wright Lawyers and Witzel Erb Backu & Partners), for unknown reasons;
• Judy Waldman Counselling, totaling $6,360;

[38] The expert fees paid to Ms. Diana Hamade, the father’s expert on the laws in the UAE, totaling more than $70,000, also appear quite excessive (as compared to approximately $20,000 charged by the mother’s expert), unless her expertise was required for other issues which were ultimately not placed before me.

[39] Based on all the above, I order the mother to pay to the father costs in the amount of $250,000, all inclusive.

Madam Justice Julie Audet

Released: May 10, 2022