Stamegna v. Ouellet, 2024 ONSC 6530
COURT FILE NO: FS-24-00040658-0000
DATE: 2024-11-22
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Charlene Stamegna
Applicant
– and –
Michel Ouellet
Respondent
COUNSEL:
Cheryl Ann Goldhart / Ysamin McGann, for the Applicant
Avra Rosen / Michelle Polster, for the Respondent
HEARD: August 15, 2024
BEFORE: RHINELANDER, J.
REASONS FOR DECISION ON MOTION
[1] The sole issue to be determined was costs of a motion, returnable August 15, 2024. Parties agreed that the substance of the motion would not be argued.
[2] The Respondent submitted the issue of costs should be reserved to the trial judge. In the alternative, he sought costs on a partial indemnity basis. While the Respondent had withdrawn his substantive motion, he sought an order that the parties attend mediation. This was relief he had sought in his substantive motion.
[3] The Applicant’s position was that she was presumptively entitled to costs pursuant to r. 24(1) and 24(10) of the Family Law Rules (“FLR”), and that costs should be decided promptly. She also sought costs for an earlier court appearance on a full recovery basis, where costs were reserved to the judge scheduled to hear the substantive motion.
[4] The Applicant further argued the Respondent’s request for the parties to attend mediation should be dismissed, because the parties agreed the only issue for determination was costs.
[5] While the issues are straightforward, it raises the recurring problem of overlapping jurisdiction between the Ontario Court of Justice (“OCJ”) and Superior Court of Justice (“SCJ”) because there is no Unified Family Court in the Toronto region. I must touch on this issue, and consider the parties motion materials, to properly consider costs.
Background
[6] The parties married October 5, 2002, and separated October 1, 2014. They have two children. A Separation Agreement (“Agreement”) was executed in 2018, with an effective date of July 1, 2018.
[7] On November 10, 2023, the Applicant filed the Agreement with the OCJ to enforce the support provisions of the Agreement by the Family Responsibility Office.
[8] On February 7, 2024, the Applicant served her Form 8 Application for a divorce and corollary relief, seeking child and spousal support pursuant to the Divorce Act and provincial legislation. The Application states the parties executed the Agreement and that it had been filed with the OCJ for enforcement purposes. The Applicant summarized terms of the Agreement regarding parenting time, child support, and spousal support, within her Application.
[9] The Respondent’s position was that the SCJ does not have jurisdiction to change, vary, or set aside an Order of the OCJ. This is not disputed. In correspondence to the Applicant, he maintained the only jurisdiction of the SCJ is to determine the divorce. He argued the Applicant’s pleadings were unclear and her approach to the issue of jurisdiction was highhanded and unreasonable. He understood the Applicant sought a redetermination of the support issues agreed to and set out in the Agreement.
[10] The Applicant scheduled a TBST court appearance to seek direction of the Court on how to proceed and to address the issue of jurisdiction based on the parties’ positions.
[11] On April 8, 2024, Diamond, J. granted leave to the Respondent to challenge the jurisdiction of this Court on the grounds of (a) s. 35 of the Family Law Act (“FLA”), and (b) terms of the parties’ Agreement. The parties were directed not to schedule a case conference prior to a decision on the issue of jurisdiction.
[12] The Respondent served his Notice of Motion, together with an Offer to Settle, on the Applicant on June 4, 2024. The Respondent sought (i) to dismiss the Applicant’s request for relief in her Application, save for her claim for a divorce, on the basis that this Court does not have jurisdiction to vary, change, or set aside the parties’ Agreement; (ii) directing the parties to proceed to a family dispute resolution process, pursuant to section 7(3) or 16.1(6) of the Divorce Act or, alternatively, to proceed to mediation based on the Dispute Resolution provisions at section 7 of the Agreement; and, (iii) for costs on a full recovery basis of her Application from the date of service and for this motion.
[13] As a condition of the Respondent’s Offer to Settle, the Applicant was required to amend her Application to only seek a divorce and an order incorporating terms of the Agreement. After which she had a choice to proceed to mediation or commence a fresh proceeding in the SCJ once the divorce order had incorporated the terms of the Agreement. The Offer addressed costs from the date of service of her Application and for the substantive Motion that was to be argued August 15, 2024.
[14] The parties corresponded after service of the Notice of Motion. On August 6, 2024, counsel for the Applicant wrote, “To be as clear as we can, we are proceeding with Ms Stamegne’s [sic] claims for child and spousal support as corollary relief under the Divorce Act”. The Respondent stated that this is the first time the Applicant’s counsel clarified the manner of the proceeding.
[15] On August 7, 2024, the Respondent replied, that based on the Applicant’s position, “which was not sufficiently clear until your email of yesterday’s date, there is no need for Mr. Ouellet to proceed with this motion”. The Respondent proposed withdrawing his Motion and reserving costs to the trial judge. The Applicant disagreed and requested costs. Hence, the parties agreed submissions as to costs would be heard on the date scheduled for the motion.
[16] As required under the FLR, the parties served and filed Form 14C Confirmation of Motion forms. The Respondent’s form stated, “The sole issue for this attendance is to determine the costs of the Motion returnable August 15, 2024. The substance of the Motion will not be argued and the Motion will be withdrawn.” [Emphasis added].
Issues
[17] Both parties served and filed costs submissions and confirmed the only issue for determination was costs. This was not the case.
[18] The issues to be determined are:
i) Whether the parties should be ordered to attend mediation pursuant to the Agreement?
ii) Which party was more successful?
iii) Should costs be reserved to the trial judge?
iv) What is the appropriate quantum of costs?
Analysis
(i) Whether the parties should be ordered to attend mediation pursuant to the Agreement?
[19] I find that since the Agreement was filed with the OCJ and is now an Order of that Court, there is no jurisdiction for the SCJ to enforce the terms of the Agreement, including directing the parties to attend mediation pursuant to s. 7 of the Agreement. The OCJ must make an order to enforce the Agreement.
[20] Section 35 of the FLA provides parties with a summary procedure to file a domestic contract with the OCJ or a Unified Family Court and to seek enforcement or variation of a term of the agreement as if it were an order of the court. This section does not include the SCJ. It was created to facilitate the recovery of support payments, and to make things more efficient and expedient. A filed domestic contract provides notice to the other party that one intends to enforce or change the agreement.
[21] The Applicant in this case filed the Agreement in the OCJ. It is therefore enforceable as an order of that court.
[22] The Applicant then initiated a Form 8 Application for a divorce and seeks corollary relief pursuant to the Divorce Act which she is also entitled to do.
[23] This is where the discord arose. The Applicant’s actions suggested to the Respondent her intent to vary or change an Order of the OCJ and this Court has no jurisdiction to vary or enforce an order of that court. Once an agreement is filed, the order is not subject to review, revision, or amendment by another court. Jasen v. Karassik, 2009 ONCA 245, Francisco v. Francisco, 2017 ONCJ 323, Ridley v. DeRose, 2015 ONSC 5635.
[24] However, in Houle v. Trottier, 2012 ONSC 6661, the Divisional Court overturned the motion judge’s decision that the SCJ lacked jurisdiction to hear corollary relief under the Divorce Act where a separation agreement had been filed with the OCJ under s. 35 of the FLA because the application was a separate application and not one to vary the other court’s order. The Divisional Court held at paragraphs 10 to 13,
[10] The appellant in this case does have the option of proceeding in the provincial court, seeking a variation in that court's child support order under s. 37 of the Family Law Act. However, she is not restricted to that one option. She has the alternative option of initiating a corollary relief proceeding under s. 15.1 of the Divorce Act. That request for relief can only be advanced in the Superior Court of Justice.
[11] The Hearing Judge correctly concluded on the authorities she cites at paragraphs 14 through 18 of her Reasons that the Superior Court of Justice has no jurisdiction to vary an order made in the Ontario Court of Justice under the Family Law Act. A request to change the order already granted in the Ontario Court of Justice can only be advanced in that court …
[12] In a similar vein, it is irrelevant that the Superior Court of Justice has no jurisdiction to vary the terms of the Separation Agreement filed with the Ontario Court of Justice under s. 35 of the Family Law Act. The appellant in this case is not seeking a variation of the separation agreement or a variation of the order for child support under the Family Law Act. She is asserting a claim for corollary relief under the Divorce Act.
[13] An order under the Divorce Act does not vary the order under the provincial legislation. Rather it supplants and supersedes the order under the provincial statute. See Pantry v. Pantry 1986 CanLII 2537 (ON CA), [1986] O.J. No., 2347 (Ont. C.A.) at para. 7. [emphasis added]
[25] The Court acknowledged there was “no limitation in the Divorce Act, which prevents or restricts former spouses from making an application for corollary relief on the basis that there is a prior order under applicable provincial legislation”.
[26] Houle was followed by Kristjanson, J. in Buffet v. Lacuesta, 2023 ONSC 5528. The Respondent conceded the SCJ had jurisdiction to hear an application for corollary relief under the Divorce Act where there was a Final Order of the OCJ. However, he asked the Court to use its discretion to have the Applicant’s corollary relief application dismissed or for the court to decline to exercise its jurisdiction over corollary relief. The Respondent argued the parties Final Order was the result of a lengthy, complex, and negotiated settlement, where significant time and money had been expended, and the Applicant was not seeking any corollary relief she did not request or was not available in the OCJ.
[27] In dismissing the Respondent’s application, Kristjanson, J. referred to s. 15.1 of the Divorce Act which provides for discretionary decisions, “including the power to make interim decisions, and to impose terms and conditions.” She then stated, “This does not mean that the negotiated settlement leading to the Consent, and the Final Order of the Ontario Court of Justice, will be disregarded”. S. 15.1(5) and (7) provides for consideration of previous orders and/or negotiated agreements.
[28] The Applicant’s Application had checked boxes for the corollary relief she was seeking and the statutory legislation she relied upon, namely, the Divorce Act and provincial legislation. If there were still ambiguities, counsel should have discussed the matter by phone rather than each picking and choosing what they would respond to in the email exchanges. The Applicant maintained throughout that this is a fresh application for a divorce, child and spousal support pursuant to the Divorce Act, and the SCJ is the only court in this region where she can obtain such relief. She never sought to change the Agreement under section 35 of the FLA, and it was clear in her Application what relief she sought.
[29] Based on these authorities, and had I been required to rule on it if the motion proceeded, I would find this Court has jurisdiction to deal with the corollary relief in the Applicant’s Application under the Divorce Act.
[30] I disagree with the Respondent’s submission that the Applicant’s position is fundamentally different than her pleadings. A conversation between counsel months earlier, rather than through emails or texts, may have resolved the issue.
[31] If I have erred on this issue, I would have dismissed the Respondent’s motion for an order that parties attend mediation because his Confirmation form indicated he withdrew his motion, which included relief of compelling mediation. He did not further update the form as required under r. 14 (11.2) FLR. Judges and opposing parties rely on Confirmation forms filed. His Confirmation form stated the sole issue was the determination of costs and his Motion will be withdrawn.
[32] The Applicant filed a similar updated Confirmation form, stating the only issue before the court is the costs of the Respondent’s aborted motion.
(ii) Which party was more successful?
[33] The Respondent argued there was no successful party as the merits were not determined. He says the Motion was necessitated by the lack of clarity in the Applicant’s pleadings and her failure to clarify same when asked.
[34] I find the Applicant was more successful and is presumptively entitled to costs (r. 24(1) FLR).
[35] Contrary to the Respondent’s position at the hearing, he communicated his intention to withdraw his motion, thereby entitling the Applicant to costs. Relying on 14(16) and 24(1), Spies J. in Murphy v. Murphy, 2010 ONSC 6204 at para. 15, held that a party shall pay the costs of the other in relation to a withdrawn motion up to the date of the withdrawal, unless the court orders or the parties agree otherwise. The same reasoning in Murphy applies to this case.
[36] I also note that at this motion to deal only with costs, and where the Respondent had withdrawn his motion, he was still seeking an order for the parties to attend mediation, for which he was not successful.
(iii) Should costs be reserved to the trial judge?
[37] The Respondent requested costs be reserved to the trial judge as the entirety of the history of the proceedings and the impact of this issue, including the Agreement/Order on the Applicant’s claims for support need to be assessed on a full record.
[38] I disagree. Costs are to be determined after every step in a proceeding (r. 24(10) FLR). While Diamond J. granted leave to the Respondent to bring his motion and ordered a determination of the issue prior to conducting a case conference, the fact that the Respondent withdrew his motion suggests a ruling on jurisdiction was not necessary for this case to proceed. This is not a case where it is appropriate to reserve the issue of costs to a trial judge.
(iv) What is the quantum of costs?
[39] Costs are in the discretion of the court: s.131 of the Courts of Justice Act, R.S.O. 1990, c. C.43. The court shall consider various factors when determining costs (r. 24(12) FLR), including the reasonableness or bad faith conduct of a party (r. 24(5) and 24(8) FLR).
[40] There are cost consequences in the FLR where a party fails to accept an offer that is as favourable or more favourable than an offer to settle (r. 18).
[41] Modern family costs rules are designed to foster four fundamental purposes: (i) to indemnify successful litigants for the cost of litigation; (ii) to encourage settlements; (iii) to discourage and sanction inappropriate behaviour by litigants; and (iv) to ensure that cases are dealt with justly: Mattina v. Mattina, 2018 ONCA 867, at para. 10; see also Serra v. Serra, 2009 ONCA 395 and Beaver v. Hill, 2018 ONCA 840, (2018) 143 O.R. (3d) 519.
[42] Costs should reflect what is a fair and reasonable amount an unsuccessful party should pay. The touchstone considerations of costs awards are proportionality and reasonableness: Beaver v. Hill, at para. 12.
[43] The Applicant seeks costs of $15,434.75 on a partial indemnity basis prior to her Offer to Settle and on a full indemnity basis afterwards. As the successful party she is entitled to costs.
[44] After examination and review of the Applicant’s Offer to Settle, dated July 16, 2024, I am satisfied that the Applicant achieved the same if not more success than her offer. The cost consequences of r. 18(14) apply as of the date of her offer.
[45] The reasonableness of the parties’ conduct is a relevant factor when making a cost order. Contrary to their allegations around the other party’s conduct, I do not find that either party acted in bad faith within the meaning as set out in Jackson v. Mayerle, 2016 ONSC 1556, (2016) 130 O.R. (3d) 683 at paras. 56-60. There were issues that needed to be vetted and discussed; it is just unfortunate the parties were unable to do so without the involvement of the court.
[46] The Applicant considered bringing a constitutional challenge regarding the two-tiered system in Toronto and the prejudice and unfairness of not having a Unified Family Court. Ultimately, she decided not to pursue this issue but included her consultations with others and consideration of this issue in her bill of costs. In determining the appropriate quantum to award the Applicant, I have excluded billings related to those consultations.
[47] I have also considered the Respondent’s submissions on time spent, his offer to settle, legal fees incurred, use of lawyers and/or staff with lower hourly rates, the complexity of the issues, and the background leading to the motion.
[48] After considering these factors and the authorities, I order the Respondent to pay the Applicant costs of this motion and the TBST appearance fixed in the amount of $11,000 inclusive of HST and disbursements.
[49] This quantum of costs is not unreasonable and what the Respondent ought to have expected to pay, given that the Respondent was seeking $10,249.95 in partial indemnity costs.
Lack of Unified Family Court
[50] This case highlights the difficulties and problems that exist in Toronto, and other areas of the province, that do not have Unified Family Courts. For example, if the Respondent seeks to enforce the Agreement, now made an Order in the OCJ, he must litigate in that court. Alternatively, he can try to expedite proceedings in the SCJ to respond to the corollary relief sought and seek to adjust any overpayments or underpayments from the net sale proceeds (or potential buyout) of the Matrimonial Home.
[51] This seems at odds with the primary objectives of the FLR which are set out in Rule 2(2) to enable courts to deal justly with cases. Other jurists have commented on the need to for Unified Family Courts throughout the province. This motion could have been avoided, with the associated cost and frustration to the parties, if there were Unified Family Courts throughout Ontario.
[52] As Shore, J. stated in T.M. v. CAS et al., 2023 ONSC 5048 at para. 1: “This case is another example of how the general public would be better served if there was a Unified Family Court in Toronto, instead of a dual/parallel court system.”
[53] Similarly, in Nodder v. Wasserman, 2023 ONSC 6982, at para. 15, Vella, J. commented, “this issue arises, in part, because of the anomaly left by the Legislature by having designated certain regions in Ontario within the jurisdiction of the Family Court of the Superior Court of Justice, and other regions, including Toronto, to maintain the OCJ, and Superior Court of Justice with respective jurisdictions to hear family matters under the FLA and other family law legislation (such as the Children’s Law Reform Act).”
[54] And more recently in F.W. v. D.B., 2024 ONSC 4823, at paragraph 1:
[1] There are twenty-five Unified Family Courts in Ontario, which does not include Toronto. Unified Family Courts are needed in every jurisdiction in Ontario sooner than later. Individuals who require the assistance of the family courts and do not reside in one of those jurisdictions, are subject to a two-tiered system. It creates a myriad of problems and leaves family litigants trying to navigate their way through a system at a time when some are most vulnerable and require the assistance of the court. Family litigants are left struggling to find the most efficient and expedient way to obtain the assistance they need, often in time-sensitive situations.
___________________________ Rhinelander J.
Date: November 22, 2024
COURT FILE NO: FS-24-00040658-0000
DATE: 2024-11-22
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
CHARLENE STAMEGNA
Applicant
– and –
MICHEL OUELLET
Respondent
REASONS FOR decision
Rhinelander J.
Released: November 22, 2024