Ontario Superior Court of Justice

Court File No.: FC-22-1062
Date: 2025/05/26

RE: D.C., Applicant
And
**B.A.T., Respondent

Before: Carter J.
Counsel: Ira Marcovitch, for the Applicant
Gordon S. Campbell, for the Respondent
Heard: In Writing

Costs Endorsement

Background

[1] The Father brought an Application seeking to have the child G.C. change schools. It was purportedly pursuant to a separation agreement. In her Answer, the Mother pleaded a claim to an equalization of net family properties despite the fact that the parties were never married. She also made a claim for a portion of the proceeds of sale of the house based on an 'inequitable division of Net Family Property', which on its face was precluded by the terms of the agreement.

[2] In response to the Mother’s new claim, the Father brought a motion for production of the solicitor’s file. The Mother brought motions to amend her Answer as it related to the proceeds of the sale of the house and for summary judgment on the school issue.

[3] The motions were scheduled for February 29, 2024. At the hearing, I held that there was insufficient time scheduled to hear all aspects of the motions. The Applicant’s motion for production of the solicitor’s file proceeded and I reserved on the matter. I ultimately dismissed the motion.

[4] The remaining aspects of the cross-motion were adjourned. The parties appeared before me on April 15, 2024. At that time, it was agreed that counsel for the Respondent would withdraw the amendment claim by the end of the week. The parties subsequently agreed that the matter could proceed by way of summary judgment. Ultimately, the Respondent was successful on that motion. In my decision I noted that the parties could provide brief written submissions on costs if they were unable to agree. Unsurprisingly, they were unable to agree.

Parties' Positions on Costs

[5] The Respondent argues she is entitled to costs on both motions that proceeded as she was successful. She also claims that she should not pay any costs for her withdrawn claim. The Applicant says he is entitled to costs for the withdrawn claim, the production motion because it stemmed from that withdrawn claim and for the parenting motion (despite the fact that he lost).

Legal Framework for Costs

[6] The first issue in addressing costs is to determine whether either party is liable to pay the other’s costs. Pursuant to r. 24(1) of the Family Law Rules, O. Reg. 114/99, there is a presumption that a successful party is entitled to costs. Success should be measured by comparing the positions of the parties on the issues litigated with the orders made. Where success in a case is divided, the court may apportion costs as appropriate (r. 24(6)). Where success is divided equally or roughly equally, it is not uncommon for the court to make no order for costs (Saroli v. Saroli, 2021 ONSC 7491, paras. 6 to 11).

[7] The Respondent was successful on the parenting issue and is presumptively entitled to costs on that issue. The Applicant was successful on the financial issue in the sense that the Respondent withdrew the claim and as a result the Applicant is presumptively entitled to costs pursuant to r. 12(3). Although the Respondent was successful on the production motion, the need for the motion arose only in the context of the financial claims which were withdrawn. Given this unique matrix, how then should costs be awarded?

Parenting Issue

[8] I will begin with the parenting issue. As the successful party, the Respondent is presumptively entitled to costs unless it can be demonstrated that she behaved unreasonably (r. 24(4)). In deciding whether a party has behaved reasonably or unreasonably, the court shall examine,

(a) the party’s behaviour in relation to the issues from the time they arose, including whether the party made an offer to settle;

(b) the reasonableness of any offer the party made; and

(c) any offer the party withdrew or failed to accept.

[9] In my decision, I found that the Respondent had acted reasonably with respect to the parenting issue. There is no basis to reconsider that finding. She made an offer. It was a reasonable one. She did not withdraw it. In addition, it was reasonable to not accept the Applicant’s offers.

[10] A party who makes an offer is, unless the court orders otherwise, entitled to costs to the date the offer was served and full recovery of costs from that date, if certain conditions are met. The only issue on this hearing is whether the Respondent obtained an order that was as favourable as or more favourable than the offer. I find that it was not.

[11] To determine whether an order is as or more favourable than a settlement offer, the court is not required to examine each term of the offer as compared to the terms of the order and weigh with microscopic precision the equivalence of the terms. Rather, what is required is a general assessment of the overall comparability of the offer as contrasted with the orders that were ultimately made (Wilson v. Kovalev, 2016 ONSC 163, para. 25). Where the offer to settle is not severable, however, the costs consequences set out in r. 18(14) should not be applied unless judgment is more favourable on all issues (Saroli v. Saroli, 2021 ONSC 7491, para. 16).

[12] The offer was not severable. There were two aspects in the offer that she did not obtain in the final order: the separation agreement was not amended and there was no order limiting the Applicant from relocating. As a result, she is not entitled to full recovery costs from the date of the offer.

[13] I will return to the issue of the quantum of costs after considering the withdrawn claims and production motion.

Withdrawn Claims and Production Motion

[14] As noted above, the Respondent brought a claim for equity in the home. A Notice of Withdrawal with respect to that claim was served on April 16, 2024. Pursuant to r. 12(3), “a party who withdraws all or part of an application, answer or reply shall pay the costs of every other party in relation to the withdrawn application, answer, reply or part, up to the date of the withdrawal, unless the court orders or the parties agree otherwise.” There is no basis for the Applicant to be denied his costs for responding to this withdrawn claim. In fact, as I will explain below, the Applicant is entitled to his full costs in responding. Such a costs award may be justified where a party persists in advancing unreasonable claims or arguments: Axford v. Axford, 2024 ONSC 2684, para. 30.

[15] In the factum on the original motion and cross-motions, counsel for the Respondent wrote as follows:

Should this court elect to grant the Mother summary judgment on the Father’s Application to force a change in [G.C.’s school], the Mother will abandon her claim to an equitable distribution of the family home proceeds which is only being advanced in response to the Father’s litigation. [emphasis added]

[16] As made clear in the factum, the Respondent’s claim was only being advanced in response to the Applicant’s litigation. In other words, it was being used as a bargaining chip to either get the Applicant to drop the claim or have the Court do so. This is an improper basis on which to launch a claim and is deserving of rebuke in the form of a higher costs award.

[17] Finally, there is the question of the production motion. On the one hand, the motion was only necessary because of the improper launching of the Respondent’s claim. On the other hand, the Respondent was successful on that motion. Furthermore, given that the sanctity of solicitor-client privilege was being challenged, the Applicant ought to have known that the prospects of success were limited. Given these unique circumstances, I conclude that no costs order should be made either way.

Quantum of Costs

[18] I turn now to quantum.

[19] The Family Law Rules expressly provide that a judge may increase or decrease what would otherwise be the appropriate quantum of costs awarded. Subrule 24(12) sets out the following list of factors the court must consider in setting the amount of costs:

(a) the reasonableness and proportionality of each of the following factors as it relates to the importance and complexity of the issues:

(i) each party’s behaviour,

(ii) the time spent by each party,

(iii) any written offers to settle, including offers that do not meet the requirements of rule 18,

(iv) any legal fees, including the number of lawyers and their rates,

(v) any expert witness fees, including the number of experts and their rates,

(vi) any other expenses properly paid or payable; and

(b) any other relevant matter.

[20] I have reviewed the costs outlines for both parties. The legal fees, number of lawyers and rates were all reasonable. The expenses were reasonable. Both parties made offers to settle that were reasonable. On the parenting issue I have found that both parties acted reasonably.

[21] There is a problem, however, on the matter of the time spent by each party. Counsel for the Applicant has broken down time spent on the different issues. Counsel for the Respondent has not.

[22] There is no form for a bill of costs or a costs outline under the Family Law Rules. Whatever format is used, it is essential that the party seeking costs provide a detailed breakdown or what services were rendered and which issues the services relate to. One of the reasons for that is to address varying levels of indemnification which may apply to different issues: Axworthy at para. 41.

[23] In reviewing the Respondent’s costs outline I have no idea what amount of time was spent on each of three issues (or when it was spent for that matter). As a result, it is impossible to determine with any degree of precision what the Respondent’s actual costs on the parenting motion were. What I am able to determine is as follows.

[24] The Applicant’s total costs for all three issues was $35,776.87 on a full indemnity basis. The costs related to the withdrawn claim and the production motion were $14,374.00. In other words, just over half of counsel’s time was spent on the parenting claim. Given that this was the primary issue, such an allocation of time seems reasonable.

[25] The total time on the file by the Respondent amounted to a costs claim in the amount of $30,967.51 on a partial indemnity basis (there is no rationale for awarding on a higher basis). Half of that would be approximately $15,500. From that number I subtract the full amount of the costs to be awarded to the Applicant for the withdrawn motion. The total amount of the costs award would be approximately $10,000.

[26] The making of a costs award is an imprecise science. Ultimately, any award made must be reasonable and proportional. For the reasons I have set out above, a reasonable and proportional award of costs in this matter would be $10,000 payable from the Applicant to the Respondent.

Carter J.
Date: May 26, 2025