Court File and Parties
Court File No.: FS-23-0092-00 Date: 2025-08-29
Superior Court of Justice - Ontario
Re: Katherine Britton, Applicant
v.
Nicholas Leigh, Respondent
Heard: In writing.
Before: Wojciechowski J.
Counsel:
- Tisha Hasan, for the Applicant
- Timothy Matthews, for the Respondent
Decision on Costs
Background
[1] The Applicant, Katherine Britton, and the Respondent, Nicholas Leigh, were involved in litigation arising from the breakdown of their relationship. While some issues in dispute were resolved, others were not, and the Applicant and the Respondent proceeded to a Binding Judicial Dispute Resolution ("Binding JDR") hearing on March 26, 2025, during which issues relating to parenting were addressed.
[2] The parties also raised property issues which had not yet been resolved, but without enough time on March 26, 2025 to discuss or consider these issues, an additional hearing date of April 4, 2025 was necessary.
[3] Following the April 4, 2025 attendance, several endorsements and/or directions were necessary in order to sort out the outstanding property issues.
[4] Following the final resolution of all issues, the parties requested an opportunity to address costs, and I invited them to make written submissions addressing their positions. I have reviewed and considered their written submissions, and this is my decision on costs.
Positions of the Parties
[5] The Respondent seeks his costs on a partial indemnity basis in the amount of $28,800.00 inclusive of disbursements and HST.
[6] The Applicant submits that each party should bear their own costs. However, should any costs be awarded, it should be the Respondent who pays costs to the Applicant in the amount of $11,603.97, which solely relates to the efforts in going through the Binding JDR process. This position is based upon the fact that many issues were resolved by the parties before they participated in Binding JDR, and as such, no costs are sought arising from issues which were settled.
Legal Framework for Costs Awards
[7] Modern costs awards address several important principles. They partially indemnify successful litigants for the cost of litigation, they encourage settlement, and they discourage and sanction inappropriate behaviour. Awards should reflect what the court views is a fair and reasonable amount that should be paid by the unsuccessful party, rather than an exact measure of the actual costs of the successful party. Part of this assessment includes considering what the unsuccessful party could expect to pay in the circumstances: see Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291 (C.A.), at para. 26.
[8] I am also guided in my analysis by the Family Law Rules, O. Reg. 114/99.
[9] Subrule 24(3) of the Family Law Rules creates a presumption of costs in favour of the successful party.
[10] Courts may also consider the factors set out in r. 24(14) which reads as follows:
In setting the amount of costs in relation to a step in a case, the court may consider,
(a) the reasonableness and proportionality of the following factors, as applicable, as they relate to the importance and complexity of the issues in the step:
(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 conditions set out in subrule (12) or the requirements of rule 18.
(iv) Any legal fees, including the number of licensed representatives 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.
[11] Further considerations with respect to costs involve any offers to settle which were exchanged. In this regard, r. 24(12) sets out the cost consequences of failing to accept reasonable offers to settle as follows:
A party who makes an offer in relation to a step in a case is, unless the court orders otherwise, entitled to costs to the date of the offer was served and full recovery of costs from that date to the conclusion of the step, if the following conditions are met:
If the offer relates to a motion, it is made at least one day before the motion date.
If the offer relates to a trial or the hearing of a step other than a motion, it is made at least seven days before the trial or hearing date.
The offer does not expire and is not withdrawn before the hearing starts.
The offer is not accepted.
The party who made the offer obtains an order that is as good as or better than the offer.
[12] The party claiming the benefit of r. 24(12) bears the onus of establishing the court's decision is as good as or better than their offer: r. 24(13).
[13] Ultimately, however, r. 24(14)(a)(iii) provides discretion to the court to consider any offers, whether or not r. 24(12) applies.
Analysis of Settlement and Success
[14] In considering all of these factors, I note that the Respondent's submissions acknowledge that the major issues as between the parties were mainly resolved during the Binding JDR Hearing through Minutes of Settlement. Because the Respondent maintains the resolution of the issues were "closely in line with the Respondent's long-standing position and offers to settle made", he submits that the settlement reached at the Binding JDR hearing was a "clear capitulation" by the Applicant in favor of the Respondent.
[15] This language of a "clear capitulation" and the concept of "overwhelming success" is referenced in a case cited by the Respondent: Simon v. Smith, 2019 ONSC 3329, at paras. 2 and 4. When one party is obviously successful in a litigation matter which is resolved before a hearing, then a court can consider awarding costs of that settled case: see Atkinson v. Houpt, 2017 ONCJ 316. Costs can be ordered in a situation where the parties reached a negotiated resolution of the relevant issues when it is possible for the court to determine that one party was more successful overall than the other party: see Johanns v. Fulford, 2011 ONSC 5268; Snelgrove v. Kelly, 2017 ONSC 4625. However, the resolution, whether recorded in a consent order or minutes of settlement, must contain terms which permit a court to evaluate the success of the parties in relation to the settled issues: see Beardsley v. Horvarth, 2022 ONSC 3430. Success and unreasonable behaviour can be determined and assessed where the factual trail was easy to follow: see Okafor v. Okafor, 2022 ONCJ 290.
[16] In reviewing the conduct of the parties towards resolving the outstanding issues which arose once their relationship was over, following the commencement of the litigation, the Respondent served four offers to settle, three with terms which were severable and one which was non-severable, and the Applicant served two offers to settle with severable terms.
[17] Partial Minutes of Settlement were signed by the parties on August 28, 2024.
[18] A second Partial Minutes of Settlement were signed on April 4, 2025. This settlement document reflected an agreement on some of the outstanding issues in dispute, and which were resolved by the parties during the Binding JDR Hearing held on March 26, 2025.
[19] Accordingly, my endorsement of March 26, 2025 addressed the following issues which remained outstanding: travel arrangements, right of first refusal for childcare, and Facetime communications.
[20] Lastly, as already noted, property issues were later addressed through additional court appearances and written submissions.
The Difficulty of Determining Success in Negotiated Settlements
[21] In considering the costs' issues put before me – which include the principles reflected in the Family Law Rules – I adopt the principle that in cases where the parties have resolved issues in dispute, a court should cautiously consider whether to award costs against one of the parties: see Goetschel v. Goetschel, 2022 ONSC 5860. It is very difficult to determine who the "winner" and the "loser" is in a negotiated settlement. This is primarily based upon the reality that it is not possible to easily determine what compromise each party made in order to reach each settlement term.
[22] If one party asserted a claim to "X", which is reflected in the minutes of settlement, why did the opposing party agree to "X"? What did the requesting party give up in order to obtain "X", and what did the opposing party get in exchange for "X"? And is "X" the outcome which would have resulted if the matter was heard and decided by a judge? How does one assess whether "X" is a win or not without getting into the weeds and hearing evidence on the basis for each term of settlement?
[23] I adopt the reasons and analysis of Leach J. found in para. 42 of the decision, Witherspoon v. Witherspoon, 2015 ONSC 6378, adopted in Talbot v. Talbot, 2016 ONSC 1351, and Hassan v. Hassan, 2019 ONSC 1199:
[42] Second, in my view, whether one is focused on pre-trial steps in the litigation or the other residual costs of the litigation, the attempt to argue cost entitlement and quantification through application of the normally applicable cost recovery rules, after the parties have reached a formal settlement of the substantive issues between them, without trial, is fundamentally misconceived and inappropriate. In that regard:
• As noted above, the cost regime created for family law litigation in this province, through enactment of Rule 24 of the Family Law Rules, focuses in large measure on the criteria of "success", (which creates a presumption of entitlement), and "reasonable" or "unreasonable" behaviour.
• However, in my view, those criteria, and the degree of relative "success" in particular, presuppose the existence of objective benchmarks from which the court in turn can draw appropriate and reliable conclusions; e.g., by comparison of party positions and with objectively determined outcomes that reveal the true relative merits of each party's position. Such objective benchmarks are lacking where the outcome against which parties attempt to argue their degree of "success" is not the product of judicial fact-finding and objective determination, but an agreed settlement.
• For example, both parties in the case before me are now trying to argue that the agreed settlement has generated an outcome more in line with their pre-settlement desires, and more or less favourable than the outcome suggested by prior settlement offers. However, such arguments presuppose that the outcome achieved by settlement is a proper benchmark by which to assess relative success, and thereby the reasonableness of either party's behaviour, insofar as the negotiated outcome should be presumed to coincide with the objective determination and outcome at which a court would have arrived, had the matter been the subject of judicial fact-finding and determination.
• In my view, those underlying assumptions are self-evidently fallacious. As our courts have recognized, "there are doubtless many motivating factors why parties enter into settlements and why a particular party may resile from claims or defences to claims either made or responded to", and "the reasonableness or unreasonableness of any party's position in either asserting a claim, abandoning a claim or abandoning a defence or answer to a claim can depend on a myriad of factors".
• In that regard, experience has shown that parties to matrimonial litigation frequently decide to compromise and accept a settlement, effectively abandoning certain pre-settlement claims and defences without pressing them to trial, not because the party concedes in any way that positions previously held in the litigation have no objective merit, but because the party is simply tired of the ongoing acrimony, and/or feels unable to incur the expense of litigating the matter through to a final conclusion after trial. Given such realities, it seems to me that permitting post-settlement claims for costs, in which negotiated settlements are used after the fact as supposed benchmarks by which the objective reasonableness of pre-settlement positions should be measured, runs counter to public policy. Endorsing such an approach would actively discourage parties from making any compromises in order to achieve settlement.
• Moreover, attempts to address such cost issues in a post-settlement context are unlikely to promote judicial economy. Again, application of the cost rules presupposes that the court is in a position to rely on factual or other objective findings that either support or detract from the parties' respective submissions. However, that self-evidently will not be the case where the parties rely on matters and considerations that have never been the subject of any judicial fact finding, or corresponding judicial determination on issues or reasonableness, unreasonableness, or alleged misconduct. The parties in the case before me seem to have come to such a realization either consciously or instinctively, given their respective efforts to now revisit contentious issues and evidence, and belatedly have such matters resolved in their favour in order to justify their cost positions. However, an exercise that effectively encourages and requires the parties and the court to revisit and essentially litigate such issues, which supposedly have been resolved by a substantive settlement, seems entirely and inappropriately retrograde in nature.
• For such reasons, our courts have held that, "where parties make a settlement as between themselves, the court … should be very slow to make an award of costs against one of the parties", and "unless there are compelling reasons to do so, costs in the circumstances of a settlement between parties ought not to be awarded by the court".
• I agree with that approach, and am not persuaded that there are any compelling reasons to depart from it in the circumstances of this case.
Application to the Present Case
[24] After reviewing the offers to settle made by the parties, and the two Partial Minutes of Settlement which were agreed upon, I am unable to determine that one party was clearly successful, or that one party clearly capitulated to the undeniably reasonable position taken by the opposing party.
[25] The issues which I was called upon to resolve at the Binding JDR Hearing were not heavily weighted in favour of one party over the other, i.e., there was divided success on these issues.
[26] Finally, with respect to the issues of property division which I was asked to consider, again success was divided as between the Applicant and the Respondent. In addition, while I note that there were a number of chattels which I was asked to divide, the legal costs in addressing these issues almost certainly exceeded the value of these chattels which included, amongst other items, 2 Riedel white wine glasses, umbrellas, towels, one stool, a baby monitor, Mikasa water glasses, Christmas decorations, 3 Riedel red wine glasses, cutlery, Kate Spade polka dot glasses, one Bodum double walled glass, a pasta bowl, 4 Mikasa wine glasses, a stuffed owl, toaster, crock pot, and pots and pans. While there were also more substantial items, such as snowmobiles and household furniture, again the parties decided to incur legal expenses in order to sort out the division of this property, which I was more than happy to address for them. However, at the end of the day, I am not prepared to support and condone this litigation approach to property division with an order for costs.
Conclusion
[27] In conclusion, having considered the submissions of the parties, noting that most of outstanding issues were resolved through Minutes of Settlement which resolution did not clearly demark a winner and a loser, there shall be no costs ordered for this proceeding.
The Hon. Mr. Justice S. J. Wojciechowski
Date: August 29, 2025