Court File and Parties

Court File No.: FS-20-17428 Date: 2023-09-26 Ontario Superior Court of Justice

BETWEEN:

Donna Rose Meffe Applicant – and – Dominic Anthony Meffe Respondent

Counsel: Lorna M. Yates, for the Applicant Self-represented, for the Respondent

Heard: In writing

Before: Sharma J.

Costs Endorsement

[1] Judgment and a Supplemental Judgment were issued on May 29, 2023 and June 7, 2023, respectively, following a two week trial in this matter. Final cost submissions were received on August 1, 2023.

[2] The Judgment favoured the positions the Applicant took at trial on most issues, namely: (a) date of separation; (b) value of the Respondent’s business interests, including real property owned through his businesses; (c) value of a condo in Florida; (d) whether interest was due on a loan given by the Respondent’s parents; (e) whether the Respondent was entitled to spousal support; (f) whether the Respondent’s claim for post-separation adjustment is wholly set-off by the Applicant’s claim for occupation rent; (g) the Respondent’s use of a BMO credit card; and (h) certain values placed on items in the parties’ Net Family Property statement.

[3] The Judgment favoured the positions the Respondent took with respect to (a) the money advanced by the Respondent’s parents as loan (but not the interest rate); (b) certain capital costs associated with maintaining the matrimonial home post-separation (although the applicant conceded to many of these expenses, but not all); and (c) certain values placed on items in the parties’ Net Family Property statement.

[4] Having considered the parties’ positions and the Judgment following trial, I find that the Applicant was predominantly and substantially the successful party. Areas where the Respondent was successful were minor, did not consume significant trial time, or were subject to concessions made a trial by the Applicant. The Applicant is, therefore, presumptively entitled to her costs (rule 24(1), Family Law Rules).

Legal Principles

[5] Rule 24 of the Family Law Rules lists factors the Court shall consider when making a cost award. They include the parties’ behaviour, time spent by each party, written offers to settle, legal fees and lawyers’ rates, expert witness fees, and other expenses. Rule 24(5) requires the Court, when considering whether a party has behaved reasonably, to examine the party’s behaviour in relation to the issues from the time they arose, the reasonableness of any offers made, and whether any offer was withdrawn or not accepted.

[6] Under rule 18, there are cost consequences imposed on an unsuccessful litigant who fails to accept an offer to settle where the successful litigant obtains an Order that is as favourable or more favourable than the offer to settle. Generally, the successful litigant is presumptively entitled to full recovery of costs from the date the offer to settle was made.

[7] The modern rules respecting costs aim to foster the following four fundamental purposes: (a) to partially indemnify successful litigants for the cost of litigation; (b) to encourage settlement; (c) to discourage and sanction inappropriate behaviour by litigants; and (d) to ensure that cases are dealt with justly in accordance with the primary objective of the Family Law Rules set out in Rule 2(2). See: Ryan v. McGregor (1926), 58 O.L.R. 213 (Ont. C.A.), at p. 216; British Columbia (Minister of Forests) v. Okanagan Indian Band, 2003 SCC 71, [2003] 3 S.C.R. 371; Fong v. Chan, 1999 CarswellOnt 3955, 181 D.L.R. (4th) 614, 46 O.R. (3d) 330 (C.A.); Serra v. Serra, 2009 ONCA 395 (C.A.) and Mattina v. Mattina, 2018 ONCA 867 (C.A.)).

[8] When fixing costs, “the costs award should reflect what the court views as a fair and reasonable amount that should be paid by the unsuccessful parties rather than any exact measure of the actual costs to the successful party.” See Zesta Engineering Ltd. v. Cloutier, 2022 ONCA 25577 at para 4, cited with approval in Boucher v. Public Accountants Council for the Province of Ontario at para 24.

[9] This case has unfortunate characteristics of far too many cases involving self-represented litigants who appear before this Court. Often, a self-represented litigant takes a position that is contrary to the preponderance of evidence or the law. The self-represented litigant is usually not familiar with court and evidentiary processes. In attempting to gather evidence and produce material for a motion or trial, the material produced is not organized or the litigant places too much emphasis on matters of little relevance to the Court’s assessment of the case. In addition to taking aim at the opposing party, the self-represented litigant often engages in attacks of the opposing party’s lawyer and refuses to follow suggestions or processes given by the lawyer. At trial, the self-represented litigant attempts to do their best and to follow direction given by the trial judge, but they remain limited in their capacity to best advance of their case.

[10] Proceedings involving self-represented litigants often drive-up costs for an opposing party who is represented. The lawyer must give the self-represented procedural direction or advice. For example, in this case and as was referred to at trial, the Respondent provided disclosure through several “document dumps” and the Applicant’s counsel had warned the Respondent about case law which required him to provide disclosure in an organized manner (see, e.g., Manchanda v. Thethi, 2016 ONSC 3776). At trial, despite being urged by the Court to adduce evidence with respect to items in his net family property statement, the Applicant’s lawyer had to take the Respondent through those items during his cross-examination. Throughout the trial, the Applicant’s lawyer assisted the Respondent with finding his own documents in CaseLines. This saved time. These are just a few of the burdens placed on the Applicant.

[11] This Court has often said that self-represented litigants are required to become familiar with court processes and the Family Law Rules. Throughout the trial, the Court gave repeated instruction and direction to the Respondent. As noted, counsel for the Applicant also assisted the Respondent. However, the reality is that self-represented litigants typically do not have legal training. For them, preparing for and managing a trial in an efficient manner is difficult.

[12] The question becomes whether it is fair to compensate a represented party for costs unnecessarily incurred because a self-represented litigant is unfamiliar with court processes, the law and evidence. As in every case where costs are imposed, it depends on a variety of factors. In my view, it is fair to order a self-represented litigant to pay costs approaching full indemnity when a self-represented party (a) challenges or fails to follow helpful procedural advice given by opposing counsel or the Court; (b) has been provided with reminders but still refuses to comply with Court orders; (c) who demonstrates a pattern of being obstinate in failing to follow court processes, despite being reminded to do so; (d) who engages in unreasonable and personal attacks, without supporting evidence, of the opposing party or their counsel; or (d) who is unwilling to engage in reasonable concessions, despite having opportunity and an ability to become familiar with the legal issues and evidence in a case.

Analysis

[13] The Applicant seeks full recovery of her legal and expert fees in the amount of $214,864.06, payable forthwith. If the Respondent does not pay a cost Order forthwith, she seeks an Order that any cost Order may be registered to any and all real properties in which the Respondent has an interest in the United States or Canada, either personally or through a corporation.

[14] The Respondent argues that he is entitled to partial indemnity costs. He alleges the Applicant behaved inappropriately throughout this litigation, made claims without supporting evidence, and that because of the difficult valuations made at trial on competing expert evidence, the parties should share equally in the cost of their respective experts. He further alleges the Applicant made “insincere and misleading” offers to settle. He alleges the Applicant was unreasonable and that her actions resulted in an unfair hearing.

[15] I make the following findings with respect to the parties’ behaviour:

a. The Respondent was unreasonable in taking the position that the parties’ date of separation was April 1, 2019. There was documentary evidence between 2015 and 2019 which showed that the parties had separated well before the Respondent’s date of separation, much of which was written by the Respondent himself. He gave evidence that, in 2019, he had been asking the Applicant about her plans to move out for years. By 2017, a separation agreement had been drafted. There was no evidence establishing an intention to reconcile thereafter. Had the Respondent conceded to the July 21, 2014 date of separation advanced by the Applicant, this trial would have been significantly shorter, and the cost of the parties’ respective experts would have been significantly reduced as they would have only had to use one valuation date.

I agree with the Applicant that approximately 20% of the trial was devoted to this issue.

b. The Respondent failed to comply with several court orders for disclosure, which lengthened and complicated this trial. Orders were made by Faieta J. for disclosure on November 22, 2021, December 6, 2021, December 20, 2021 and January 4, 2022. The Respondent was provided with several extensions to produce the same information. The list of disclosure is found in para. 22 of my Judgment. It may be that some of this disclosure was disclosed prior to trial. However, I am satisfied that critical financial disclosure ordered to be disclosed was not provided until mid-trial. For example, it was only mid-trial that the Applicant’s expert business valuator, Mr. Holmes, was able to agree upon the business valuation put forward by the Respondent’s expert, Ms. Alterman. This is because the Respondent had not produced his business’ Corporate Tax Returns to allow Mr. Holmes and the Applicant to conclude their valuation of the Respondent’s business. Had it been produced as ordered months prior to trial, the parties’ respective experts could have likely agreed upon the valuation and saved trial time. This unreasonable behaviour is worthy of sanction.

c. I am satisfied that the Respondent engaged in a document dump. At trial, I was taken to emails the Respondent sent to Applicant’s counsel with numerous documents attached. Those documents were not individually named, nor were they organized in a .pdf brief with tabs and an index. Despite being advised by Applicant’s counsel of case law which prohibits such dumps, the Applicant did not attempt to do better. This method of disclosure is entirely inappropriate, especially after the Respondent was given direction by Applicant’s counsel with authority cited.

d. The Respondent argued a motion at the commencement of trial to have one of the Applicant’s expert reports not admitted into evidence. However, the Respondent was fully aware that Kristjanson J. granted a consent Order allowing reports to be filed by October 28, 2022. Furthermore, one of the Applicant’s reports was in response to a late filed report by the Respondent.

e. The issue of equalization took the bulk of trial time. I agree with the Applicant’s estimate that it consumed 50% of trial time. This time could have been significantly reduced if the Respondent agreed to the Applicant’s date of separation.

I also find that the Applicant was not reasonable with respect to the treatment of the loan advanced by the Respondent’s parents to the parties, which factored into the determination of the equalization payment. I found it was a loan and not a gift, and that there had been no payments made toward the loan.

In my Supplemental Judgment, I found the Applicant was entitled to an equalization payment of $498,536.55. The Applicant, in her last offer dated October 24, 2022, had offered to receive an equalization payment of $480,000. Therefore, the Applicant beat her offer and is entitled to full indemnity costs as of October 24, 2022 on this issue.

f. There was a real, triable issue with respect to the value of 1982 Islington Avenue, a property that was owned by the Respondent’s businesses. In my Judgment, I found its value difficult to measure, given its unique characteristics, but ultimately preferred the value advanced by the Applicant’s expert. It was not unreasonable for the Respondent to take a position that was different from the Applicant.

g. The Respondent was delayed in valuing his assets. It was the Applicant who had to engage an expert to value them first. These were assets owned by the Respondent or his businesses. The onus was on him to perform these valuations.

h. The Respondent did not lead evidence to establish entitlement to spousal support. He did not establish facts to support a compensatory claim. He failed to prepare a Financial Statement prior to trial, making it impossible to assess his need for spousal support. In fact, his last Financial Statement was prepared two years prior to trial. The Applicant’s position in her offers was that no spousal support was payable. She received an outcome as favourable as her offers.

i. The Respondent was sloppy in his preparation of his Net Family Property Statement. Many of the disputed items ought to have been agreed upon. It was only on cross-examination that he finally conceded to values identified by the Applicant. Again, time was wasted on this issue.

j. With respect to his claim for post-separation adjustments, he included items that were self-serving and without a legal or evidentiary basis. For example, he granted himself a “management fee” for his maintenance of the home. He provided totals for other expenses (credit card interest or bank costs), without producing the back up documentation to evidence these costs. This was a waste of time.

k. Around his disclosure, he consistently said that he had produced documents but was unable to identify documents to demonstrate they had been disclosed. While he was self-represented, it is clear he ought to have done more to prepare for trial.

l. Finally, the pattern of the Respondent making bald and unfounded allegations continued in his cost submissions. Once again, he had opportunity to take the court to documents to support the positions he was taking. Instead, he again resorted to unsupported allegations.

[16] I find that the amount of costs sought by the Applicant is not unreasonable, given the conduct of this litigation and the years of experience of the Applicant’s counsel. The expert fees are also not unreasonable. The Applicant is seeking $214,864 in costs, which includes $72,822 in expert fees. The Respondent seeks $289,163 in costs, of which, $130,640 is expert fees and $157,000 represents the cost of his time, which he has fixed at $256/hour. When compared with what the Respondent says is a reasonable amount of costs to which he is entitled, it cannot be said that the Applicant’s total costs are unreasonable. Furthermore, I found Applicant’s counsel was organized, used trial time efficiently, and she provided significant assistance to the Respondent and this Court throughout the trial.

[17] I have reviewed the parties’ offers. The Applicant made several offers (November 10, 2021; October 10, 2022, and October 24, 2022). Each of the Applicant’s offers were entirely or partially severable. The Respondent’s three offers to settle were not (January 26, 2022; October 12, 2022; and October 19, 2022). The Applicant beat her last offer with respect to equalization. She beat all offers with respect to spousal support. She beat her offer, made November 13, 2020 which remained open for acceptance for 11 months with respect to the date of separation. The Respondent did not beat any offers he made. I am satisfied that the Applicant made reasonable offers to settle and the Respondent did not.

[18] Having considered these factors, I order the Respondent to pay costs of this Application fixed in the amount of $190,000, payable forthwith.

[19] I further order that (a) this cost Order may be registered on title to any and all real properties in which the Respondent has an interest in the United States or in Canada, either personally or through a corporation, including 4753 Estero Blvd., Unit 105, Fort Myers Beach, Florida (subject to a confirmation Order from a Florida Court), and 1982 Islington Avenue, Toronto, Ontario, and (b) the Respondent’s interest in these properties may be subject to enforcement proceedings.

[20] I grant this Order because there is a history of the Respondent not complying with court orders, including for payment of cost Orders. To give this cost Order effect, it is necessary to provide the Applicant the tools to enforce it.

[21] This Cost Order bears interest at the post-judgment interest rate of 7%, pursuant to s. 129 of the Courts of Justice Act.

JUSTICE M. SHARMA

Released: September 26, 2023