Court File and Parties

COURT FILE NO.: FC-16-1046 DATE: 2022/04/29 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Michael Switzer and Colleen Switzer

BEFORE: Justice Mark Shelston

COUNSEL: Michael Switzer self represented Eric Letts for the Respondent

HEARD: In Writing

Cost Endorsement

Shelston, J.

[1] The applicant submits his total costs are $687,011.66 consisting of $103,496.61 for services of counsel rendered to November 1, 2019, and based on the applicant’s estimate, as he has no dockets, that he spent 743 hours of legal work for his trial from November 2, 2019 to December 31, 2021. However, despite the total figure, and based on mixed success on some issues at trial, he claims total costs of $339,000 all in against the respondent.

[2] The respondent seeks an order that the applicant pays costs in the amount of $62,301.23, to be paid to the respondent from the applicant’s portion of the net proceeds of sale of the matrimonial home.

Successful Party

[3] The Family Law Rules provide that the successful party is presumptively entitled to costs. The applicant submits that on the various issues before the court, the result was either in his favour, a tie, or no costs should be awarded. The respondent submits that she was more successful overall and that she should be entitled to be awarded with costs.

[4] The issues for the trial included which party would make the major decisions for the children, the parenting arrangement, child support, section 7 expenses, spousal support, security for spousal support, equalization of the net family property, post separation adjustments and costs.

[5] I find that the respondent was successful on more issues including but not limited to the following issues:

a) Being granted decision-making responsibility regarding the children. b) Being granted the parenting time schedule that she proposed. c) Imputing an income to the applicant commencing in the year 2017 going forward. d) A finding that retroactive child and spousal support from August 2014 to December 31, 2015, was not settled in mediation. e) Commencing in the year 2017, retroactive and prospective child support. f) Commencing in the year 2016, retroactive and prospective spousal support. g) The quantum and duration of spousal support. h) Obtaining an order that the applicant’s obligation to pay child and spousal support shall be binding on his estate. i) The finding that the applicant did not accept all the terms of the respondent’s offer dated January 13, 2020, regarding the matrimonial home, that there was no oral agreement on August 12, 2014, regarding the matrimonial home and that the applicant was not granted 90 days from the date of the release of the trial decision to purchase the respondent’s interest in the matrimonial home. j) Obtaining an order that the matrimonial home be listed for sale. k) A finding that the respondent did not retain $250,000 of contents from the matrimonial home. l) A finding that the tax rate for notional disposition costs for the RRSP was 25% rather than 47% as advocated by the applicant. m) A finding that the security deposit of $8,250 was an asset on the date of separation. n) A finding rejecting the applicant’s evidence that on the date of marriage he had $100,000 and personal items and $200,000 of contents. o) A finding that the applicant was not entitled to $90,631.36 for excess interest payments on the mortgage related to the matrimonial home post separation. p) A finding that the respondent was not responsible for half of the capital loss in the amount of $78,125 as alleged by the applicant. q) A finding that the applicant was not entitled to be reimbursed the amount of $36,843.68, representing the expense incurred regarding the matrimonial home and except the sum of $2,072.41 consented to by the respondent. r) A finding that the applicant was not entitled to occupation rent. s) A finding that the applicant was not entitled to $20,000 from the respondent regarding the disability tax credit. t) The equalization payment.

[6] The applicant was successful on certain issues including but not limited to the following issues:

a) Opposing any retroactive child support, spousal support, or section 7 expenses, from August 2014 to December 31, 2016. b) The value of the applicant’s interest in Flaherty LLP, Torwith Services, and 1012713 Ontario Limited. c) A finding that the respondent owed the applicant $46,538.90 up to May 1, 2021, for carrying cost for the matrimonial home as well as an accounting up to the date of the sale of the matrimonial home. d) A finding that the applicant was entitled to a post separation adjustment of $8,018.12 with respect to the van retained by the respondent postseparation. e) A finding that the respondent is responsible to reimburse the applicant the amount of $8,244.25 for interest paid on the joint loan postseparation until the loan was paid in full. f) A finding that the respondent was not entitled to compensation for the therapy expenses and other section 7 expenses.

[7] I find the respondent was the more successful party on the most important issues, such as decision-making responsibility for the children, the parenting time’s schedule, the imputation of income to the applicant starting in 2017, quantum and duration of spousal support, the sale of the matrimonial home and the equalization of the net family property. I find that there was divided success on other issues, but on the main issues for this trial, the respondent was the more successful party and is presumptively entitled to her costs.

Importance and Complexity of the Issues Before the Court

[8] The issues before the court were very important, but I did not find that any of the issues were difficult or complex.

The Reasonableness or Unreasonableness of Each Party’s Behaviour

[9] In Mattina v. Mattina, 2018 ONCA 867, the court set out the four fundamental purposes of costs being to partially indemnify successful litigants, to encourage settlement, to discourage and sanction inappropriate behaviour by litigants and to ensure that cases are dealt with justly.

[10] In Beaver v. Hill, 2018 ONCA 840, the court indicated that cost awards are discretionary and that two important principles to consider in exercising discretion are reasonableness and proportionality.

[11] I find that the applicant acted unreasonably. After the trial, the respondent discovered that during this trial, the applicant was awarded income replacement benefits retroactive to 2018. Even though the respondent rejected an opportunity to bring a motion to reopen the trial evidence to consider this evidence, the applicant was under an obligation to make full and frank disclosure and his failure to advise the respondent and the court was unreasonable behaviour. In addition, many of the claims advanced by the applicant were without any corroborative evidence, were without merit and unnecessarily lengthened the trial time.

[12] I find that both parties acted unreasonably in failing to agree on basic facts that should have been agreed to prior to the trial. On at least two occasions, the trial was adjourned for the afternoon to allow the parties to agree on certain facts rather than receive evidence on the individual receipts and expenses claimed by the parties. These agreements should have occurred prior to the trial.

[13] I find that both parties acted unreasonably by failing to make any offers to settle before the trial. In my view, failure to serve an offer to settle is itself an unreasonable behaviour. Failure to file an offer to settle prevents the matter from either having partial settlements, or a total settlement. While the applicant was self-represented, he is an experienced lawyer as is counsel for the respondent. There is simply no explanation provided, by either of the party, about why no offers to settle were submitted. That silence speaks volumes as to why this trial lasted 17 days, starting in May 2021 and finishing in February 2022, with at least two posttrial motions required to bring this litigation to an end. Had the parties been properly prepared for the trial, acted reasonably, and communicated with each other, this trial should not have taken more than seven days. The only witnesses involved were the applicant and the respondent.

Lawyers’ Rates

[14] I find that the hourly rate of Ms. Rossi and Mr. Letts to be fair and reasonable, based on the experience of the respective lawyers.

Time Properly Spent and Expenses Properly Payable

[15] In Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291 (C.A.), the court stated that the court’s role in assessing costs is not necessarily to reimburse the litigant for every dollar spent on legal fees, but the award of costs must be fixed in an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceedings.

[16] The applicant agrees that the quantum of legal fees is reasonable, except for the expert report account. The expert report, at a cost of $6,924, was incurred to determine the value of the applicant’s interest in his former law partnership and affiliated companies. I accept the submission that the professional accountant was required to sort out the applicant’s partnership status and income at the beginning of this litigation. I also find that the expenses for binding, photocopying and court reporting services are all valid expenses.

Disposition

[17] Based on the respondent being the successful party and that the respondent acted unreasonably, I order the applicant to pay to the respondent her costs fixed in the amount of $47,500 inclusive of HST and disbursements, which said sum to be paid to the respondent from the applicant’s portion of the net proceeds of sale of the matrimonial home.

Justice Shelston Released: April 29, 2022