Superior Court of Justice

Court File No.: FS-22-0144 Ontario

Endorsement

Applicant: Kailyn Mychal Johnson Counsel: S. Sikora

Respondent: William Robert Johnson Counsel: D. Brawn

Date: March 19, 2026

ADDENDUM ON COSTS

[1] For oral reasons delivered on January 29, 2026, after three days of trial I made a Final Order of that same date which concluded with my ordering the following;

"If the parties cannot agree on the issue of costs for this trial, the Court will entertain written submissions dealing with all aspects of the award of costs. Any party claiming costs shall serve and file written submissions and a bill of costs no later than 20 days from the date of this Order. Any responding submissions shall be served and filed within 15 days thereafter."

[2] I have considered the Costs Submissions of the Applicant for Trial and the Bill of Costs of the Applicant, both dated February 13, 2026. The Applicant is seeking for the Respondent to pay her full indemnity costs of $24,577.27 given the Applicant's overall success with respect to her Offer to Settle, and the Respondent's unreasonable conduct.

[3] I have also considered the Respondent's Costs Submissions dated March 10, 2026, and the Respondent's Bill of Costs dated March 4, 2026. It is the submission of the Respondent that costs awarded to the Applicant in this matter ought to be in an amount closer to partial indemnity than substantial indemnity, although no specific dollar amount is suggested. I will not repeat in detail their written submissions on costs from these experienced Counsel since they are relatively brief.

[4] The starting point in addressing the issue of costs is section 131 of the Courts of Justice Act, which provides that subject to the provisions of an Act or rules of Court, costs are within "the discretion of the Court, and the Court may determine by whom and to what extent the costs shall be paid."

[5] Rule 24 of the Family Law Rules (FLR) addresses the issue of costs, and subrule 24(3) states that except "as otherwise provided in this rule, there is a presumption that a successful party is entitled to the costs of a step in a case."

[6] Modern costs rules are designed to foster four fundamental purposes; (1) to partially indemnify successful litigants; (2) to encourage settlement; (3) to discourage and sanction inappropriate behaviour by litigants and; (4) to ensure that cases are dealt with justly under subrule 2 (2) of the Family Law Rules: Mattina v. Mattina, 2018 ONCA 867.

[7] The justice system is a precious public resource. Access to the justice system by individuals must be balanced with the need to ensure that the resource is available for all those who need it. This is one of the purposes of Rule 2: Lawrence v. Lawrence, 2017 ONCJ 431, at para. 52.

[8] Parties to litigation must understand that Court proceedings are expensive, time-consuming and stressful for all concerned. They are not designed to give individual litigants a forum for carrying on in whatever manner they may choose, oblivious to the impact of that conduct on the other side and, perhaps most importantly for the purposes of this case, oblivious to the mounting costs of the litigation: Lawrence v. Lawrence, supra, at para. 54.

[9] Modern costs rules accomplish various purposes in addition to the traditional objective of indemnification. An order as to costs may be designed to penalize a party who has refused a reasonable settlement offer. Costs can also be used to sanction behaviour that increases the duration and expense of litigation or is otherwise unreasonable or vexatious. In short, it has become a routine matter for Courts to employ the power to order costs as a tool in the furtherance of the efficient and orderly administration of justice; Lawrence v. Lawrence, supra, at para. 31.

[10] Recently RULE 18: OFFERS TO SETTLE of the Family Law Rules was revised by revoking Rules 18(14) to (16) and adding the following Rule;

"Costs consequences

(12.1) The making, withdrawal, acceptance and rejection of offers are subject to the costs consequences provided for under rule 24."

[11] Also, RULE 24: COSTS was substantially revised, including the following revisions;

"Deciding costs

24. (1) Promptly after dealing with a step in a case, the court shall, in a summary manner,

(a) determine who, if anyone, is entitled to costs in relation to that step and set the amount of any costs; or

(b) expressly reserve the decision on costs for determination at a later step in the case.

Same

(2) The failure of the court to act under subrule (1) in relation to a step in a case does not prevent the court from awarding costs in relation to the step at a later step in the case.

Entitlement to costs, presumption

(3) Except as otherwise provided in this rule, there is a presumption that a successful party is entitled to the costs of a step in a case.

Divided success

(4) If success in a step in a case is divided, the court may apportion costs as appropriate.

Unreasonable behaviour by successful party

(7) A successful party who has behaved unreasonably during a step in a case may be deprived of all or part of the party's own costs or ordered to pay all or part of the unsuccessful party's costs.

Same

(8) In deciding whether a successful party has behaved unreasonably, the court may consider,

(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 did not accept.

Absent or unprepared party

(9) If a party is required to appear at a step in the case but does not do so, or appears but is not properly prepared to deal with the issues at the step or otherwise contributes to the step being unproductive, the court shall award costs against the party unless the court orders otherwise in the interests of justice.

Bad faith

(10) If a party has acted in bad faith, the court shall decide costs on a full recovery basis and shall order the party to pay them immediately.

Representative at fault

(11) If a party's representative has run up costs related to a step in a case without reasonable cause or has wasted costs, the court may, on motion or on its own initiative after giving the representative an opportunity to be heard, make one or more of the following orders:

1. That the representative shall not charge client fees or disbursements for work specified in the order.

2. That the representative must repay any money that the party has already paid toward costs.

3. That the representative must repay the party any costs that the party has been ordered to pay another party.

4. That the representative must personally pay the costs of any party.

5. That a copy of the order be given to the party.

Failure to accept offer

(12) 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 the offer was served and full recovery of costs from that date to the conclusion of the step, if the following conditions are met:

1. If the offer relates to a motion, it is made at least one day before the motion date.

2. 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.

3. The offer does not expire and is not withdrawn before the hearing starts.

4. The offer is not accepted.

5. The party who made the offer obtains an order that is as good as or better than the offer.

Same, burden of proof

(13) The burden of proof that the order is as good as or better than the offer to settle is on the party who claims the benefit of subrule (12).

Setting costs amounts

(14) 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.

Supporting materials

(15) Any claim for costs respecting fees or expenses shall be supported by documentation satisfactory to the court.

Same, opposing party

(16) A party who opposes a claim for costs respecting fees or expenses shall provide documentation showing the party's own fees and expenses to the court and to the other party.

Requirement for parties to confer

(17) Before each step in a case, each party shall confer or make best efforts to confer orally or in writing with every other party with a view to settling costs, including the amount of costs, unless the party is prohibited from such communication by a court order or there is a risk of domestic violence by a party who is not represented by a licensed representative.

Requirement for parties to prepare submissions

(18) For the purposes of subrule (1), each party shall, for each step in a case, be ready to,

(a) make an oral submission as to costs in relation to that step; and

(b) provide the court with the documentation required by subrules (15) and (16) as applicable.

If court requires written submissions

(19) If the court requires the parties to provide written submissions on costs with respect to a step in the case, the following rules apply, unless the court orders otherwise:

1. Each party shall serve and file a written submission on costs no later than 15 days after the court requires the written submissions.

2. A party may serve and file a responding written submission on costs, no later than 30 days after the court requires the written submissions.

3. A written submission shall be no longer than three pages or, if it relates to costs of a trial, five pages, not including the documentation required by subrules (15) and (16).

4. A written submission shall be typed or written legibly, with double spaces between the lines and characters of at least 12 point size, not including the documentation required by subrules (15) and (16)."

[12] Counsel for the Applicant produced their Offer to Settle dated October 8, 2024, and pointed out that the Respondent maintained, in his Offer to Settle, that his position was for the parties to have joint decision-making and a week-about parenting regime. Upon my comparison of the Applicant's Offer to Settle dated October 8, 2024 with my Order dated January 29, 2026, I agree that the Applicant obtained "an order that is as good as or better than the offer." I therefore should find that the Applicant is entitled to "full recovery of costs" from October 8, 2024 to and including January 29, 2026. It is also submitted that only the Respondent behaved unreasonably throughout this trial process which began with his overholding the child from the Applicant's care causing her to bring this Application and an urgent motion. Furthermore, at trial the Respondent was unable to satisfactorily explain his continual breaches of Court Orders.

[13] Counsel for the Respondent referred the Court to paragraphs 8 and 16 of Beaver v. Hill, 218 ONCA 840, which outlined that "the failure of an offer to settle to contain a true element of compromise is a factor to be considered in deciding whether the offer properly impacts on the appropriate award of costs... it is but one factor that is to be considered". It is submitted therefore that undue weight ought not be placed on the fact that the Applicant made an Offer very close to what was awarded at trial. As was evident at trial, the Respondent appears to be of modest means, and it is also submitted that his ability to pay costs as the unsuccessful party is important. It is further submitted that no submissions as to costs were made for any of the attendances prior to the trial, and that while the Respondent was not successful at trial his decision to proceed and his reasons for pursuing his remedy were not unreasonable.

[14] In Boucher v. Public Accountants Council (Ontario), 2004 CanLII 14579 (ON CA), [2004] O.J. No. 2634 (Ont. C.A.), the Ontario Court of Appeal indicated that a costs award should be a "fair and reasonable amount that should be paid by the unsuccessful parties rather than any exact measure of the actual costs of the successful litigant". A "fair and reasonable amount" is that amount which the unsuccessful party could reasonably have expected to pay in the event of lack of success in the litigation: Lupien v. Carmichael, 2017 ONSC 2929, at para. 9.

[15] One measure of what is "fair and reasonable" to pay in costs may be arrived at by looking at what the unsuccessful party paid for their own legal fees: Mohr v. Sweeney, 2016 ONSC 3238, at footnote 5.

[16] A successful party in a family law case is presumptively entitled to costs, subject to the factors set out in Rule 24 FLR. As indicated in Beaver v. Hill, at paras. 9 and 10;

"judges are not constrained to the normal scales of costs found in the Rules of Civil Procedure, since no scales of costs are mentioned in the Family Law Rules. Also, the Family Law Rules expressly provide that, depending on the conduct of the parties and the presence or absence of offers to settle, a judge may increase or decrease what would otherwise be the appropriate quantum of costs awarded.

[10] Second, the respondent's assertion that this court's decision in Berta v. Berta (2015), 128 O.R. (3d) 730, [2015] O.J. No. 6844, 2015 ONCA 918 supports the "full recovery" approach to costs in family matters also reflects a failure to read the decision closely. What this court endorsed in that case was the principle that "a successful party in a family law case is presumptively entitled to costs" (at para. 94) subject, though, to the factors set out in Rule 24. This caveat is an important one since, as this court pointed out in Frick v. Frick (2016), 132 O.R. (3d) 321, [2016] O.J. No. 5625, 2016 ONCA 799, the Family Law Rules "embody a philosophy peculiar to a lawsuit that involves a family" (at para. 11), arising from that the Family Law Rules were enacted to reflect the fact that litigation in family law matters is different from civil litigation. The family rules provide for active judicial case management, early, complete and ongoing financial disclosure, and an emphasis on resolution, mediation and ways to save time and expense in proportion to the complexity of the issues. In the rare instance when a matter is not adequately covered by the family rules, the court may decide the issue with reference to the civil rules. This is contained in Rule 1(7) of the Family Law Rules.

[17] Again, from Beaver v. Hill, the Ontario Court of Appeal outlines the following:

"[11] There is no provision in the Family Law Rules that provides for a general approach of "close to full recovery" costs. Rather, rule 24(12) sets out the appropriate considerations in fixing the quantum of costs. It reads:

(12) In setting the amount of costs, the court shall consider,

(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.

[12] As the wording of the rule makes clear, proportionality and reasonableness are the touchstone considerations to be applied in fixing the amount of costs.

[13] Further, a "close to full recovery" approach is inconsistent with the fact that the Family Law Rules expressly contemplate full recovery in specific circumstances, e.g., bad faith under rule 24(8), or besting an offer to settle under rule 18(14)," (now see new subrule 24(12)).

[18] Determining the amount of costs is not simply a mechanical exercise. Costs must be proportional to the amount in issue and the outcome: Lawrence v. Lawrence, supra, at para. 64.

[19] Family law litigants are responsible for and accountable for the positions they take in the litigation. New subrule 24(12) sets out the costs consequences of failure to accept an Offer to Settle.

[20] From new 24(13), "The burden of proof that the order is as good as or better than the offer to settle is on the party who claims the benefit of subrule (12)."

[21] When the Court exercises its discretion over costs, it may take into account any written offer to settle, the date it was made and its terms, when exercising its discretion over costs, even if 24(12) FLR does not apply.

[22] 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. What is required is a general assessment of the overall comparability of the offer as contrasted with the Order: Wilson v. Kovalev, 2016 ONSC 163.

[23] Rule 24(4) FLR provides that where success in a step in a case is divided, the Court may exercise its discretion to order and apportion costs as appropriate. However, the determination of whether success was truly "divided" requires a contextual analysis that take into consideration the importance of the issues that were litigated and the amount of time and expense that were devoted to the issues that required adjudication: Lippert v. Rodney, 2017 ONSC 5406, at para. 14.

[24] From Lippert v. Rodney, at para. 34;

"34 The Ontario Rules of Civil Procedure refer to three "scales" or "ranges" for costs award, namely "partial indemnity costs", "substantial indemnity costs" and "full indemnity" costs. The Family Law Rules do not make reference to these scales, but adopt the phrase "full recovery" costs as being the appropriate award in certain situations. There has been some discussion about whether this phrase refers to the full amount which a party claims, subject to adjustments based on reasonableness, or something between the full amount claimed and the concept of "substantial indemnity." (See Mary Jo Maur and Nicholas Bala, "Re-thinking Costs in Family Cases: Encouraging Parties to Move Forward," paper presented at the National Family Law Program, July 2014, Whistler, British Columbia.). In my view, the term "full recovery" refers to the full amount which the party has claimed, subject to any adjustments that the court considers appropriate based on the reasonableness and proportionality of the costs claimed. In other words, it means the total reasonable and proportional amount that a court determines the party should have spent in dealing with the case (Jackson, at para. 91). This conclusion accords with the case-law in the civil context which has interpreted the phrase "full indemnity costs." (Toronto Standard Condominium Corporation v. Baghai Development Ltd., [2012] O.J. No. 2746 (C.A.)). While the Family Law Rules outline certain circumstances in which full recovery costs are appropriate, the court is not limited to making a full recovery award in those specified situations (Sims-Howarth). It is ultimately a matter of the court's discretion to determine whether full recovery is appropriate having regard for the particular circumstances of the case."

[25] While Rule 24(14)(b) FLR does permit the consideration of ability to pay (under the umbrella of "any other relevant matter"), it is given significantly less prominence than the presumption that costs will follow success: Lawrence v. Lawrence, supra, at para. 33.

[26] Ability to pay alone cannot, nor should it, over-ride the other factors in Rule 24(14): Lawrence v. Lawrence, supra, at para. 35.

[27] The financial means of the unsuccessful party may not be used to shield them from liability for costs, particularly when they have acted unreasonably: Lawrence v. Lawrence, supra, at para. 36.

[28] Those who can least afford to litigate should be most motivated to seriously pursue settlement, and avoid unnecessary proceedings: Mohr v. Sweeney 2016 ONSC 3338 at para. 17.

[29] To determine whether a party has been successful, the Court should take into account how the Order compares to any settlement offers that were made. The position each party took in the case should also be examined: Lawrence v. Lawrence, supra, at para. 41.

[30] Recently, in Hmoudou v. Semiali, 2020 ONSC 1330, Swartz J. endorsed the opinion of Justice Pazaratz in Scipione v. Scipione, 2015 ONSC 5982, noting that "who got what they asked for?" is the primary question in every costs decision. In Hmoudou at para. 21 the Court elaborated:

"It is completely unreasonable to not get what you ask for, and then argue that somehow success was divided or that you were in fact successful. There are situations where there is divided success, or where in examining a comprehensive settlement it may be impossible to unravel who got what and whether it was valuable to them or not. Caution must be exercised in situations where a settlement has been presented to a Court, and then the Court is asked to assess costs. Where there are allegations of unreasonable behaviour, bad faith, or where the minutes of settlement are so intricate as to be enmeshed in a global structure, this initial caution may lead to a refusal to order costs in such circumstances. There will clearly be compromises made and settlements reached, where the motivation and considerations are unknown. It may then be impossible to determine who was successful, to assess reasonableness and reach a just and equitable order of costs."

[31] Family Law Rule 24(14) sets out the factors the Court shall consider in setting the amount of costs. These include the importance or complexity of the issues, the lawyer's rates, the time spent and the expenses paid or payable. As stated earlier, the Court shall also ensure reasonableness, fairness and proportionality in the cost assessment.

[32] In cases involving custody and access claims, a more tempered approach to costs may be appropriate depending on the circumstances of the case. The rationale for this is that parties should not be discouraged from advancing bona fide custody or access claims that are meritorious out of fear of possible deleterious financial consequences.

[33] One of the measures that the courts use in determining whether costs claimed are fair, reasonable and proportional is to consider the amount that the other party has paid for their own legal fees with respect to a matter. A significant discrepancy in the amount of fees that the parties have incurred may prompt the court to embark upon a more detailed scrutiny of the costs claimed to ensure that the amount meets the overall objectives of a costs order.

[34] Upon my review of the Respondent's Bill of Costs dated March 4, 2026, I note that the total "Fees and HST" is $17,303.46 which does not include any amount for disbursements. Also, the Respondent did not produce his Offer to Settle mentioned in the Costs Submissions of the Applicant, which may have been useful for this Court to assess whether there was any "true element of compromise" in the position or positions taken by the Respondent prior to trial.

[35] As this Court indicated in my oral reasons for the Final Order dated January 29, 2026 from this trial, I agree that the Respondent behaved unreasonably throughout this trial process which began with his overholding their child from the Applicant's care requiring the Applicant to litigate this matter. I also found that the Respondent committed a number of breaches of Court Orders and I was not satisfied with the Respondent's explanations and rationalizations for his breaches. However, this Court recognizes that there is a difference between his unreasonable behaviour and the high threshold of egregious behaviour for there to be a finding of bad faith engaging the cost consequences of Rule 24(10) FLR. In any event, Counsel for the Applicant quite correctly did not request a finding of bad faith for the Respondent's pattern here of unreasonable conduct.

[36] In awarding costs, the Court must consider the financial means of the parties, their ability to pay, and the effect of any costs ruling on the parties and children. However, the Court must also keep in mind the financial circumstances in each parent's household including the impact of unrecovered legal fees on the other parent's household including the impact of unrecovered legal fees on the other parent's ability to similarly provide for the children. Therefore, ability to pay will be less of a mitigating factor when the impecunious party has acted unreasonably as the Respondent has here.

[37] Even where the "full recovery of costs" provision is triggered as it does here by an Offer to Settle which meets the Rule 24(12) FLR requirements, quantification of costs still requires an overall sense of fairness and reasonableness. The Court retains a residual discretion to make costs awards which are proportional, fair and reasonable. Therefore, based on the above analysis, it is my view to award the Applicant between 80 to 85 percent of her costs for this trial.

[38] As a result, having considered all applicable principles to the circumstances presented for this trial including those as set out in the Family Law Rules, and in the exercise of my discretion, including as set out in section 131 of the Courts of Justice Act, I have determined that it is fair, reasonable, just and proportionate to award the Applicant costs in the amount of $20,000.00 all-inclusive, to be payable by the Respondent within 30 days.

Date: March 19, 2026 The Honourable Justice David Nadeau