Court File and Parties

COURT FILE NO.: FS-17-421609 DATE: 20240724 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Feng Wang, Applicant AND: Min Li, Respondent

BEFORE: Schabas J.

COUNSEL: Feng Wang, self-represented Min Li, self-represented

HEARD: In writing

Costs Endorsement

[1] Following a seven-day trial heard in March 2024, I released Reasons for Judgment in this matter on April 22, 2024, dismissing the Applicant’s claim for equalization and, to the extent it was asserted at trial, his claim for support: Wang v. Li, 2024 ONSC 2352. I granted the relief sought by the Respondent and ordered the Applicant to pay the Respondent $75,000 in damages for his abusive tortious conduct towards her. The parties provided written submissions respecting costs, which I address in this Endorsement.

[2] The Respondent was completely successful at trial and seeks costs on a full indemnity basis in the amount of $81,116.96, including fees and disbursements. However, a review of her submissions shows that she is in fact claiming $96,856.96 [1] and that this amount will not fully indemnify her.

[3] The Applicant has stated that his total legal fees from 2017 to the trial in 2024 are $179,621.56. His submissions do not address the Respondent’s claims for costs, but instead make complaints about my findings and include what appears to be new expert evidence that he sought to adduce following the conclusion of the trial and which I did not permit.

[4] The Court has a broad discretion in fixing costs. The overall objective is to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particular circumstances: Boucher v. Public Accountants Counsel for Ontario. In Davies v. Clarington (Municipality) (2009), 2009 ONCA 722, 100 O.R. (3d) 66, Epstein J.A. stated at paras. 51-52:

The overriding principle is reasonableness. If the judge fails to consider the reasonableness of the costs award, then the result can be contrary to the fundamental objective of access to justice. Rather than engage in a purely mathematical exercise, the judge awarding costs should reflect on what the court views as a reasonable amount that should be paid by the unsuccessful party rather than any exact measure of the actual costs of the successful litigant. In Boucher, this court emphasized the importance of fixing costs in an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding at para. 37, where Armstrong J.A. said “[t]he failure to refer, in assessing costs, to the overriding principle of reasonableness, can produce a result that is contrary to the fundamental objective of access to justice.”

[5] In some circumstances courts will award costs on an elevated scale, which may provide either full or substantial indemnity to the successful party. Such cases are relatively rare. Generally, they arise where serious but unfounded allegations of wrongdoing have been asserted and pressed by the unsuccessful litigant, or the losing party conducted the litigation in an oppressive or unreasonable manner, unnecessarily increasing the length and expense of the action which the court finds worthy of sanction. As Epstein J.A. stated in Davies, however, at para. 45:

Of course, a distinction must be made between hard-fought litigation that turns out to have been misguided, on the one hand, and malicious counter-productive conduct, on the other. The former, the thrust and parry of the adversary system, does not warrant sanction: the latter well may. In Apotex v. Egis Pharmaceuticals, 4 O.R. (3d) 321 (Gen. Div.), substantial indemnity costs were justified as a means [at para. 8] "to discourage harassment of another party by the pursuit of fruitless litigation . . . particularly where a party has conducted itself improperly in the view of the court".

[6] As the Respondent was successful at trial she is presumptively entitled to costs. In support of her claim for full indemnity costs she relies on Offers to Settle and the conduct of the Applicant in the litigation.

The Offers

[7] The Respondent made several Offers to Settle during the course of the action. All of them involved her paying the Applicant a sum of money and that he give up any interest in the matrimonial home and return personal property. The sum offered early in the litigation was $120,000, and then was reduced to $60,000 in 2021 and again reduced to $50,000 in 2023 and 2024. The Applicant’s responses to these offers was dismissive and abusive – calling the first one “absurd”, and the later ones “junk”, and he threatened to “blacklist” her.

[8] The Applicant, on the other hand, offered to settle in 2022 on the basis that he obtain title to the matrimonial home, and in 2023 he offered to settle if the Respondent paid him $2,435,389.

[9] Given my findings, the Applicant would have done better to have accepted the offers to settle – any of them – made by the Respondent. Further, the Applicant’s offers were unrealistic and not reasonable; they amounted to offers to capitulate. The Offers to Settle clearly favour an elevated award of costs.

The Applicant’s Conduct

[10] Turning to the conduct of the action, I have already commented negatively on the Applicant’s conduct in my Reasons for Judgment, including referring to evidence he sought to withhold, false financial information provided by him, and lies he told me under oath at the trial.

[11] I now have more history of the conduct of the action. The litigation was commenced in December 2017 – some six and a half years before the trial – and was beset by a lack of cooperation from the Applicant who, as I heard at trial, sent a great many emails to the Respondent’s lawyer running up fees and causing distress to the Respondent. Many of those emails have been provided to me in the Respondent’s costs submissions. The Applicant also made reports to the police, repeatedly made false allegations, and sought to appeal interlocutory decisions all the way to the Supreme Court of Canada. All of this, the Respondent submits, exacerbated her depression and distress flowing from the Applicant’s conduct prior to their separation. It is clear to me, and I saw it at trial, that the Applicant’s abusive behaviour did not stop when the parties separated.

[12] This is supported by the Endorsement of Kraft J. dated August 11, 2022 (Wang v. Li, 2022 ONSC 468), which dismissed, as baseless, the Applicant’s motion in which he asserted that the Respondent had committed perjury, forged documents, was concealing assets, and should be jailed for contempt. Justice Kraft’s Endorsement also helpfully sets out some of the tortured history of the proceedings and gives examples of the Applicant’s abusive conduct towards the Respondent and her lawyer at the time.

[13] In her lengthy Endorsement, Kraft J. stated at para. 7:

I find that the husband’s allegations against the wife and her lawyer are unfounded. The husband is cautioned from continuing to make baseless allegations in these proceedings as against the wife and/or her counsel.

[14] Unfortunately, the Applicant did not get the message and his misconduct continued.

[15] In my view, the Applicant’s conduct of the litigation also clearly supports an elevated award of costs. The Applicant made serious and unfounded allegations of wrongdoing throughout the litigation, and conducted the litigation in an oppressive and unreasonable manner, unnecessarily increasing the length and expense of the action.

Quantum

[16] I turn then to the quantum of the costs award.

[17] The Respondent has incurred disbursements for the tracing of funds and evidence presented by Mr. Krofchick in the amount of $13,049.61. She has also incurred translation costs of $1,582.59. These disbursements are supported by documentation and should be paid by the Applicant.

[18] The Respondent seeks $18,000 for professional fees she incurred in China, including fees for her appraiser, who testified, and for lawyers she had to hire there to rebut allegations made by the Applicant to the Chinese authorities. In support of the reasonableness of her claim, the Respondent refers to the Applicant’s Bill of Costs dated April 22, 2024 in which he claimed $37,331.98 for fees he incurred for similar work:

From December 2017 to 2024 (trial), the applicant hires a lawyer (China), the respondent's background investigation, asset investigation and evaluation, document translation, notarization of documents, witness appearance, etc., total cost: $37,331.98.

[19] In my view, the Respondent’s claim of $18,000, which is less than 50% of the fees the Applicant says he paid in China to deal with this matter, is reasonable and is an amount that the Applicant would reasonably expect to pay as part of a costs award against him in the litigation.

[20] The Respondent represented herself at trial. She did so very effectively, even though English was not her first language. She had to become familiar with the Family Law Rules and the law applicable to the case. She reviewed all the documents and correspondence relating to the claim, which was extensive and difficult in light of the misleading nature of the Applicant’s position. Trial materials had to be prepared and uploaded to CaseLines, among other things.

[21] In my view, the Respondent’s claim for costs for trial preparation and trial at a rate of $60/hour for 650 hours, leading to a total amount of $39,000 is well-justified. The rate, as she notes, is less than the rates for law clerks and students contained in the Law Society Fee Schedule, and is very reasonable. In addition, the claim for 650 hours for preparation and conducting a trial of this type is also reasonable. Accordingly, $39,000 is well within the range of what the Applicant ought to have expected to pay the Respondent for her time and effort in preparing for and conducting the trial, even on a partial indemnity scale.

[22] The Respondent also seeks $25,224.76 for fees paid to her lawyer between 2017 and January 2023. The Respondent tells me in her submission that she paid her lawyer $115,027.52 over the approximately five years when she was represented. The lawyer’s rate was between $275 and $375 per hour. However, the Respondent advises that the Applicant has paid $39,353.24 in costs, and she states she is only claiming one-third of the balance of $75,674.28.

[23] Although I do not have any details of prior costs awards, I can reasonably infer that the Applicant’s payments were the result of costs orders made in the proceedings arising from motions - why else would he have paid her anything? Such awards would not, however, have indemnified the Respondent for reasonably expected legal fees arising from the litigation generally, such as drafting pleadings, disclosure of documents and other matters that would have come up in this protracted case. In these circumstances, especially where an elevated award is justified, the amount sought is an amount that the Applicant can reasonably have expected to pay in costs.

[24] Accordingly, and in conclusion, having considered the impact of the Offer to Settle, the importance of the issues, the conduct of the parties and other factors as set out in Rule 24 of the Family Law Rules, as well as principles set out in Boucher and Davies, the award of costs sought, which does not fully indemnify the Respondent, but may be an elevated award above the partial indemnity rate, is warranted. Correctly adding the items sought by the Respondent – $13,049.61 + $1,582.59 + $18,000 + $39,000 + $25,224.76, totals $96,856.96. In my view, having regard to all the circumstances, and applying the principle that costs awards should reflect “what the court views as a fair and reasonable amount that should be paid by the unsuccessful party”, I order that the Applicant pay the Respondent costs in the amount of $96,856.96.

Paul B. Schabas J. Date: July 24, 2024

[1] See para. 37 of the Respondent’s submissions.