Court File and Parties

COURT FILE NO.: FS-22603-19 DATE: 2023-01-18 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN: Marie Therese Chantal Courchesne, Applicant – and – Joseph Paul Luc Seguin, Respondent

Counsel: Carol L. Hartman, for the Applicant Matti E. Mottonen, for the Respondent

HEARD: Written Submissions

Decision on Costs

P. BOUCHER J.

Background

[1] On March 29, 2022 I heard the applicant’s motion dated September 21, 2021 and the respondent’s motion dated October 28, 2021. On May 27, 2022 I released my decision on the motions (my “first decision”).

[2] The applicant brought a motion dated June 02, 2022 in which she asked that I correct mathematical errors I made in my first decision. That motion was argued November 30, 2022 and I released my decision on December 02, 2022 (my “second decision”). I invited the parties, if they could not otherwise agree on costs, to deliver written submissions, which I have received and considered. This is my decision on costs for both motions.

[3] With respect to my first decision, the respondent submits he is entitled to his costs going back to February 2020. He suggests that his offer to settle the first set of motions was closer to the result in my decision than the applicant’s offer. He asks for full indemnity costs of $67,199.70 which includes accounting fees of $21,470. Regarding my second decision, the respondent argues he obtained a better result than his offer to settle. He accordingly seeks full indemnity costs of $11,599.45 which includes $1,695 in accounting fees.

[4] The applicant argues that she was more successful than the respondent with respect to both of my decisions. She submits the respondent’s unreasonable behaviour, most notably in failing to provide a business valuation and income report, entitles her to substantial indemnity costs (which she defines as 80% of her total costs). Her substantial indemnity costs for the first motion including accounting fees are $47,748.15; the second motion, $12,866.18.

The Law

[5] Modern costs rules promote several key objectives: to provide partial indemnity to successful parties, to encourage settlement, to sanction unreasonable behaviour and to ensure cases are dealt with justly.

[6] Subrule 24(1) of the Family Law Rules creates a presumption of costs in favour of the successful party. There is also a presumption in subrule 18(14) that a party that obtains a result equal to or better than their offer to settle is entitled to full recovery costs from the date of the offer and costs up to the date of the offer.

[7] Courts must also consider the factors set out in subrule 24(11) which reads as follows:

24 (11) A person setting the amount of costs shall consider, (a) the importance, complexity or difficulty of the issues; (b) the reasonableness or unreasonableness of each party’s behaviour in the case; (c) the lawyer’s rates; (d) the time properly spent on the case, including conversations between the lawyer and the party or witnesses, drafting documents and correspondence, attempts to settle, preparation, hearing, argument, and preparation and signature of the order; (e) expenses properly paid or payable; and (f) any other relevant matter.

[8] Ultimately, costs are within the discretion of the court. Reasonableness and proportionality are two important considerations in exercising that discretion – see Beaver v. Hill, 2018 ONCA 840. While bills of costs must be considered, the court should not engage in an exact measure of the time needed for, and the validity of each step taken by counsel. Rather, it is what the court views as fair and reasonable in the circumstances, and what the unsuccessful party could reasonably expect to pay, that is important.

Analysis

[9] Both parties claim they had the greater success on each motion. To measure success, I need to briefly review the positions they took on the decisions I was asked to make. In the first set of motions, the parties asked me to decide each of their incomes, the quantum of child and spousal support (with start dates more than a year and a half pre-dating the delivery of the motions) as well as some minor property issues. They had already resolved the parenting issues and that agreement was incorporated into my first decision.

[10] Their positions on the first set of motions are summarized in paragraph 3 of my first decision which is reproduced below:

[3] Briefly stated, for the purposes of determining child support and spousal support, the applicant asks me to set the respondent’s annual income at $286,000 and her annual income at $25,000. The respondent asks that the applicant’s annual income be set at $73,935. With respect to his annual income, the respondent makes the following arguments: a. That it should be set at $103,667 which is his line 150 income on his most recent tax return; b. Alternatively, that it should be set at $119,417 which is the three-year average of his line 150 income; c. Alternatively, that it should be set at $140,426 which is the pre-tax income available to him through his corporation for the most recent tax year; and d. Alternatively, that it should be set at $154,350 which is the three-year average of the pre-tax income available to him through his corporation.

[11] It is noteworthy that for the purposes of Justice Kurke’s consent without prejudice interim order dated September 18, 2018, the parties agreed the applicant’s annual income was $30,000; the respondent’s, $200,000. In my first decision, I set the applicant’s annual income at $40,459 and the respondent’s at $154,350 based on taxable Canadian dividends (other than eligible). The start dates for the changes to the quantum of child and spousal support were November 01, 2021 and November 15, 2021 respectively.

[12] The parties delivered valid offers to settle the first set of motions. Neither of the offers were as good as or better than what I ordered, though the respondent’s figures were closer to what was achieved. I note the respondent also took four alternative positions on how his income should be determined. This complicated rather than streamlined the motions.

[13] Success was clearly divided on the first set of motions. My determination of the parties’ income resulted in small changes to the consent order in comparison to the changes the parties sought.

[14] In my second decision, I agreed with the applicant that I had made an inputting error in my use of DivorceMate and that subrule 25(19)(b) gave me jurisdiction to correct the error. I disagreed with the applicant on how that error should be fixed and accordingly I did not increase support to the amount she sought. The respondent argued I did not make any mathematical or inputting errors and did not have jurisdiction to vary my first decision. He took this position despite the fact I agreed with his fourth alternative argument regarding determination of his income. In oral argument he conceded that if I agreed with his argument on income then I must have made a mistake with the software, which I could correct.

[15] The applicant made a valid offer to settle her June 02, 2022 motion. It was neither as good as nor better than the result achieved and was in fact what she had been seeking in her motion. In a letter from his counsel to opposing counsel the respondent offered to resolve the motion essentially along the lines of what was achieved. The offer was not signed by the respondent, contrary to subrule 18(4). It cannot be considered a formal offer to settle – see Sader v. Kekki 2014 ONCJ 41 at paras. 16-19. It accordingly does not engage the special costs considerations of subrule 18(14).

[16] Success was divided on the second motion. I also find the parties’ response to my error was disproportionate to the issue in dispute: did I make a mathematical or inputting error and could I correct it? The applicant, though correct that I made an inputting error, attempted to reargue my determination of the respondent’s income. The respondent, though he avoided the quantum of support sought by the applicant, denied my mistake and jurisdiction to amend it despite the findings made in my first decision.

[17] Lastly, the applicant asks that I award her costs because of the respondent’s unreasonable behaviour. The reasonableness of a party’s position, argument and conduct is a relevant consideration. Most of the applicant’s concerns about unreasonable behaviour relate to positions taken on the motions. There was divided success on the motions. Both parties took positions with which I did not agree. I do not see how the respondent’s behaviour differed sufficiently from the applicant’s to warrant a costs award in her favour. For example, the applicant suggests the respondent increased the cost of the litigation by not obtaining a business valuation and income report. Yet she has failed to file a tax return since separation, which did not assist me in determining her income.

Conclusion

[18] For these reasons, the parties will bear their own costs for the motions.

The Honourable Mr. Justice P.J. Boucher Released: January 18, 2023