Samira Zaki v. John Kimball Chang, 2026 ONSC 4007

CITATION: 2026 ONSC 4007

COURT FILE NO.: FS-11360-18

DATE: 2026-07-09

SUPERIOR COURT OF JUSTICE – ONTARIO

FAMILY COURT

RE: SAMIRA ZAKI, Applicant

AND:

JOHN KIMBALL CHANG, Respondent

BEFORE: Justice I.F. Leach

COUNSEL: Birkin J. Culp, for the Applicant

Paul Pellman, for the Respondent

HEARD: In writing

ENDORSEMENT

1This endorsement is focused on resolution of the sole remaining issue between the parties; i.e., costs associated with effecting a transfer of shares in two private corporations from the Applicant to the Respondent.

Procedural overview

2By way of an initial procedural overview as to how this matter has come before me for decision:

a. When this matter was called for trial before me in Woodstock on March 9, 2026, I was advised that the parties were actively engaged in final resolution discussions, including discussions regarding anticipated arrangements to have other individuals, (not parties to the action but shareholders in the relevant corporations), participate in measures to finalize and implement the aforesaid transfer of shares. In the result, trial of the matter was adjourned to the following day, at the request of the parties, to allow for those further developments.

b. When court resumed on March 10, 2026, I was presented with a draft final order, approved as to form and content, and which the parties asked me to make on consent, finally resolving outstanding issues regarding child support and summer parenting time. After that order had been signed, I was advised that the remaining issues were limited to the parties’ formal request for a divorce, and the costs associated with preparation of documentation to effect the aforesaid share transfer arrangement, which had been finalized with the participation of the relevant non-party shareholders. In that regard:

i. As far as the parties’ request for a divorce was concern, a further order was made on consent severing the divorce request from the corollary issues, with that request to proceed thereafter by way of an uncontested motion in writing to be processed by the Applicant.

ii. As for the costs associated with the relevant share transfer agreement:

1. Both parties expressly confirmed that was the only other outstanding issue in dispute. Without limiting the generality of the foregoing, both parties expressly confirmed that all other cost issues between them had been resolved.

2. Both parties also confirmed that they were content to have that sole remaining cost issue addressed and resolved by way of written submissions, pursuant to a timetable also established on consent. In particular, the Applicant’s written submissions in that regard were to be delivered within 30 days, the Respondent’s written responding submissions in that regard were to be delivered within 15 days thereafter, and the Applicant’s written reply submissions, (if any), were to be delivered within 5 days thereafter.

iii. The Applicant’s written submissions, (with attachments including invoices charged to the Applicant by various law firms, a copy of a draft share purchase agreement with suggested “redlined” changes previously proposed by the Respondent, a Bill of Costs regarding counsel fees relating only to the share transfer agreement, and a Bill of Costs regarding research and preparation devoted to the Applicant’s written submissions), thereafter were delivered on or about April 8, 2026.

iv. The Respondent’s written responding submissions, (with attachments including a copy of a consent order made by Justice Hebner on July 12, 2019, a copy of an original Shareholder Agreement governing arrangements between shareholders to one of the relevant private corporations, and copies of emails and more formal correspondence exchanged between counsel regarding the lingering share transfer issue), then were delivered on or about April 23, 2026.

v. The Applicant apparently chose not to tender any written reply submissions.

Further background and party positions

3Cost determinations made following settlements are a notoriously imperfect exercise.

4Without limiting the generality of the foregoing, where a court has not adjudicated on the merits or been presented with any sworn evidence in a manner keeping with the rules of procedural fairness, the court inherently has a restricted/limited window into the underlying aspects of a cost dispute. The court’s ability to assess matters such as relative success, and/or to determine whether there has been inappropriate behaviour by a litigant, based only on competing submissions, is similarly limited.¹ In that regard, it also must be remembered that cost submissions are not evidence, and cannot properly be considered as such by the court.²

5With those important caveats in mind, further background to the particular cost issue now before me, gleaned from the parties’ written submissions and attached documents, (but necessarily incomplete and somewhat in dispute), includes the following:

a. After the parties married, (with the Respondent at least apparently having been married previously, resulting in earlier child support obligations), they occupied a matrimonial home located on in the city of Woodstock, and had one child together.

b. Throughout most if not all of the marriage, the Respondent apparently was employed professionally as a pharmacist, and worked for a business known as the Norwich Pharmacy. The corporate structure underlying that business was described in underlying corporate documents and/or counsel correspondence as involving the following arrangements:

i. The property on which the pharmacy is situated is owned by a numbered corporation; i.e., 2418715 Ontario Limited. The pharmacy business is carried on via a different numbered corporation; i.e., 2415411 Ontario Limited.

ii. The affairs of 245411 Ontario Limited were/are governed by a Shareholder Agreement dated April 17, 2024.³ That lengthy document, (25 pages), was supplied in its entirety for my consideration, and generally speaks for itself. While I have reviewed and considered the complete document, I will not attempt to replicate or describe its content in detail here. For present purposes, I nevertheless note the following general points:

1. The corporation initially had three shareholders; i.e., Jayantkumar Patel, Pranavkumar Amin, and the Applicant. In particular, pursuant to the initial capitalization at least, there initially were 100 common shares issued in the corporation, with Mr Patel holding 40 shares (or 40 percent of the total shareholding), Mr Amin holding 20 shares (or 20 percent of the total shareholding), and the Applicant beneficially holding the remaining 40 shares, (or 40 percent of the total shareholding), although additional provisions of the agreement indicate or at least suggest that Mr Patel was holding title to the Applicant’s shares in trust for the Applicant.

2. Any shareholder had/has the right to call a meeting of shareholders on the giving of prescribed notice.

3. Each shareholder holding one third or more of the corporation’s common shares also had/has the right to nominate one director to the corporation’s board of directors, subject to approval of the nominee by the other shareholders. At the outset at least, and subject to change by the board of directors, the corporation’s two named directors were Mr Patel and Mr Amin, who were also named as the corporation’s two officers; i.e., with Mr Patel serving as the corporation’s president and Mr Amin serving as the corporation’s secretary.

4. All shareholders agreed upon strict confidentiality provisions that were to apply during and after the agreement whereby, inter alia, no personal or financial matter of any other shareholder, or any matter concerning the corporation or its business was to be disclosed to any other person except with the prior consent in writing of the affected shareholder or by resolution of the corporation’s board of directors.

5. The shareholder’s agreement also imposed significant restrictions on the issuance of further shares in the corporation, or the transfer of existing shares in the corporation. Among the detailed provisions of the agreement in that regard were the following:

a. No shareholder was/is to “sell, assign, transfer, encumber, pledge or dispose” of his or her shares in the stock of the corporation “without the prior written consent of all other shareholders, except as provided in [the] agreement”.

b. The potential transfer of shares to any “outsider” was governed, in particular, by approximately two pages of detailed provisions, including an obligation on any shareholder desiring to transfer or sell his or her shares to first make an offer in writing to the other existing shareholder or shareholders to sell the shares to that other existing shareholder or shareholders; i.e., giving the corporation’s other shareholders a “right of first refusal” in relation to any such share transfer or sale.

c. Even if the aforesaid right of first refusal was not exercised by an existing shareholder or shareholders, any sale or transfer of shares to an “outsider” third party purchaser was still subject to satisfaction of numerous condition precedents, including the third party purchaser’s delivery to the corporation and each shareholder of a covenant under seal to be bound by the obligations of the shareholder making the sale or transfer, apart from those relating to personal service or employment.

6. The aforesaid provisions regarding any sale or transfer of shares were supplemented by general provisions of the agreement regarding such matters, imposing various obligations imposed on any selling shareholder. Those obligations included the selling shareholder’s provision of a required release to the corporation and purchasing shareholder in relation to specified claims, and a general undertaking to give such further assurances and do all other things required to deliver title to the shares and indebtedness acquired by the purchasing party free and clear of the claims of all others.

7. The agreement also contained/contains detailed provisions regarding capitalization of the corporation, both by debt capital borrowings from bankers or other conventional financial institutions, and/or from the shareholders loaning capital to the corporation by way of shareholder loans or “excess” shareholder loans if/as necessary, which could in turn give rise to security agreements in relation to the corporation’s property. The agreement also includes provisions governing guarantees and indemnities shareholders might provide or be required to provide.

c. Again, I was not provided with any similar shareholder’s agreement relating to 2418714 Ontario Limited. However, correspondence sent by counsel for the Respondent indicates that the Applicant owned 40 common shares in that corporation as well, suggesting arrangements similar to those existing in relation to 2415411 Ontario Limited. The order made by Justice Hebner, (referred to below), also refers to the Applicant owning shares in both corporations.

d. According to the Applicant’s written cost submissions:

i. The corporate shareholders other than the Applicant are the Respondent’s business partners, (with whom the Respondent has been partners since 2014), and the shares “owned” by the Applicant, although formally registered in the Applicant’s name, nevertheless exist solely for the benefit of the Respondent; e.g., to conceal income of the Respondent from child support obligations owed to the Respondent’s previous spouse, and to circumvent a non-competition clause arising from the Respondent’s prior employment by another pharmacy.

ii. The Applicant received no financial benefit whatsoever from her ostensible shareholdings in the corporations, with the entire financial and practical benefit from those shareholdings actually flowing to the Respondent.

e. Correspondence from counsel for the Respondent indicated that, in relation to the amount required for the Applicant to “buy in” to the corporations, (i.e., approximately $170,000 for her 40% shareholdings), the Respondent contributed approximately half that amount, (i.e., $85,000), reflected as a loan on the understanding that the Applicant was to contribute the other half. The same correspondence argued that the Applicant knew she was the beneficial owner of the shares; e.g., insofar as the shareholder agreement specifically indicated that Mr Patel was holding the shares in trust for the Applicant, (rather than the Respondent), and the Applicant, by her subsequent conduct, (i.e., by entering into the party agreement that was then reflected and embodied in the consent order made by Justice Hebner, described below), implicitly represented that the Applicant had ownership of the shares and could pass title to them.

f. At some point, the parties separated, leading to the commencement of this family law litigation. In the course of that litigation, at a time when both parties had independent legal representation, the matter came before Justice Hebner on July 12, 2019, at which time Justice Hebner was asked to make a partial final order on consent in accordance with partial final minutes of settlement that had been signed and filed with the court. In that regard:

i. Paragraphs 1 and 2 of the resulting consent order deals with residence of the parties and other parenting time arrangements, including exchanges of the child.

ii. Paragraph 3 of the order deals with equal division of the sale proceeds of the parties’ matrimonial home, which were being held in trust by a specified law firm. The transfer of those funds was to be completed by July 30, 2019.

iii. Paragraphs 4 and 5 of the order deal with transfer of the Applicant’s shareholdings in the two corporations to the Respondent. As the paragraphs lie at the heart of the current dispute, I will reproduce them in full here:

4. AND THIS COURT FURTHER ORDERS THAT the Applicant, Samira Zaki’s shares in 2415411 Ontario Ltd. and 2418715 Ontario Limited shall be transferred to the Respondent, John Kimball Chang. If there is any cost and/or tax liability with said Transfer the Respondent shall be solely responsible for same. The share transfer shall take place contemporaneously with the release of the net proceeds of sale to each party. The Applicant shall release all rights and claims to 2415411 Ontario Ltd. (Limited) and 2418715 Ontario Limited and shall sign all documentation to give effect to this release.

5. AND THIS COURT FURTHER ORDERS THAT the shares shall be transferred to the Respondent at an ACB (adjusted tax basis)(sic). The parties will execute a Joint Election in a form and content agreeable to both parties.

[Emphasis added.]

g. According to the terms of the parties’ agreement, reflected in the consent order made by Justice Hebner, the contemplated transfer of the Applicant’s shareholdings in the two corporations was to be effected at the same time as the transfer to each party of their equal share in the net sale proceeds of the matrimonial home, with that transfer to be completed no longer than July 30, 2019. However, by the time the matter came before me on March 9, 2026, (more than 6½ years later), the contemplated transfer of the Applicant’s shareholdings in the two private corporations to the Respondent still had not taken place. Each blames the other for the delays and complications in that regard. Without limiting the generality of the foregoing:

i. Contentions by the Applicant, in support of her position that the Respondent has been responsible for such delays and complications, include the following:

1. It was said that the Respondent alone stood to benefit from the share transfer, but “took no steps to prepare the necessary share transfer documentation”. Indeed, the Applicant’s written submissions went so far as to assert that the Respondent failed “to take any step” to implement the sale transfer “for nearly seven years”.

2. It was emphasized that the Applicant accordingly was forced, after an extended period of such alleged complete inaction by the Respondent, to take the initiative in terms of moving forward; i.e., via the retention of specialized corporate legal counsel to assist with arrangements to effect the share transfers, with the Applicant necessarily incurring legal costs in that regard. That counsel commenced work on the matter in May of 2020, and went on to complete draft documents that included share purchase agreements, transfer resolutions and undertakings regarding elections for both corporations, all of which were forward to Respondent counsel on June 2, 2020, with a request to make arrangements for the Respondent’s signature. However, it was said that the Respondent then not only did not sign the documentation, but “made no substantive response” and “did nothing” for “nearly two years”. In the meantime, the Applicant “was required”, (for unexplained reasons), to retain new family law counsel; i.e., to follow up on the outstanding share transfer arrangements and other issues relating to the divorce proceedings, with the share transfer arrangements being one of the outstanding issues discussed at further conferences and court attendances held in relation to the litigation.⁴

3. In the meantime, the Applicant says, she and her counsel continued to press for resolution of the outstanding share transfer issue. In particular, in addition to correspondence exchanged with Respondent counsel and counsel for the corporations, on April 20, 2022, the Applicant signed the share purchase agreements that had been prepared by her corporate counsel, and they were resent to Respondent counsel. However, instead of simply signing those agreements, the Respondent and his counsel then sent the Applicant and her counsel a “substantially redlined” version of the draft share purchase agreement relating to 2418715 Ontario Limited. (The Applicant’s written submissions refer to only one document in that regard, relating to 2418715 Ontario Limited; no mention is made of any proposed revised draft of the share purchase agreement relating to 2415411 Ontario Ltd., and only the “redlined” version of the share purchase agreement relating to 2418715 Ontario Limited was submitted for my review.) Receipt of the “redlined” draft share transfer documentation from the Respondent, proposing various amendments to the draft documents initially prepared by the Applicant’s specialized corporate counsel, prompted the Applicant to consult with that specialized corporate counsel again, resulting in more legal expense incurred by the Applicant. In the result, (i.e., after receiving that further legal advice), the Applicant took the position that the amendments to the draft share transfer documentation being proposed by the Respondent were fundamentally inconsistent with the parties’ agreement reflected in Justice Hebner’s aforesaid order, insofar as the proposed amendments, amongst other things:

a. contemplated removal or reduced conditional status of the indemnification and release provisions intended to protect the Applicant from any further/ongoing liability arising from her ownership of the shares;

b. required the Applicant to “indemnity” and “hold harmless” the Respondent and corporations in relation to any alleged breach of the Applicant’s “representations and warranties”; and

c. threatened to delete provisions releasing the Applicant unless the Respondent was satisfied that the Applicant had contributed all required shareholder loan amounts – although that obligation was said by the Applicant to have been discharged already.

4. It was emphasized that the resulting impasse then lingered up to the second day of trial, when the Respondent was said to have finally “capitulated”; i.e., by signing, without any amendments, the share transfer documentation as originally drafted by the Applicant’s corporate counsel and forwarded to the Respondent in June of 2020. That suggested “capitulation” was said to underscore the reality that all of the delay, amendment issues and associated further expense incurred after June of 2020 was completely unnecessary, wasteful, and attributable to the Respondent alone.

5. It was argued, implicitly if not expressly, that the Respondent’s conduct in that regard reflected not only unreasonable conduct, (needlessly prolonging the litigation and forcing extra steps that could have been avoided), but bad faith; i.e., insofar as delay furthered a collateral purpose of benefiting the Respondent via “the effect of understanding the Respondent’s income and reducing his child support obligations to both the Applicant and his former spouse”.

ii. Contentions by the Respondent, in support of his position that the Applicant and/or non-party shareholders has/have been responsible for such delays and complications, rather than the Respondent, include the following:

1. The suggestion that the Respondent had done nothing to follow up on implementation of the share transfer arrangement was simply and fundamentally inaccurate; e.g., as demonstrated by Respondent counsel correspondence reminding the Applicant that it was her responsibility to transfer the shares, (pursuant to the parties’ agreement reflected in Justice Hebner’s order), and threatening the Applicant with a motion for contempt if the Applicant failed to move forward with such arrangements. In that regard, it also was emphasized:

a. that the Respondent belatedly learned, (via a review of a requested invoice associated with fees incurred to prepare the share transfer documentation), that the Applicant failed to retain corporate counsel in that regard for more than a year after the Applicant assumed the obligation, (via the parties’ agreement, reflected in Justice Hebner’s order), to transfer the shares;

b. that while the Respondent lacked any legal authority or ability to implement the share transfer, he did make unsuccessful attempts to contact the non-party shareholders in the two corporations, (i.e., the shareholders other than the Applicant), in an effort to obtain clarification of the situation and promote a resolution of the apparent underlying shareholder dispute regarding transfer of the shares;

c. that there was an effectively agreed pause in the proceedings associated with the Applicant receiving a cancer diagnosis and corresponding treatment;

d. that the matter also has been delayed by the Applicant’s successive changes in counsel; and

e. that the matter eventually resolved not by any belated “capitulation” by the Respondent simply agreeing to the original share transfer documentation prepared on behalf of the Applicant, but by the existing non-party shareholders preparing modified resolutions, and the other shareholders eventually indicating that they thereafter were prepared to execute documentation to effect the share transfer arrangement, at which point the Respondent immediately executed the documentation as well – with the share transfer thereafter still requiring the Applicant’s execution of a necessary direction to transfer the relevant shares.

2. It was argued, implicitly if not expressly, that the agreement of the parties, reflected in the consent order made by Justice Hebner, was procured by fundamental misrepresentations and/or bad faith on the part of the Applicant; e.g., insofar as the contemplated share transfer arrangement had been “portrayed” inaccurately to the Respondent as something that would be “straightforward and simple”, with the Applicant effectively having represented that she had “sole authority to fulfil the terms of the settlement and that she had disclosed all relevant information regarding the shares”, all of which was said to be “grossly inaccurate”. Without limiting the generality of the foregoing, it was emphasized:

a. that the Applicant actually had not complied with the provisions of the relevant shareholder agreements;

b. that the Applicant actually had not obtained the approval of the contemplated share transfers required from the other shareholders, who wanted, inter alia, reimbursement of a shareholder loan before agreeing to the proposed share transfer; and

c. that the Applicant had failed to disclose that there apparently was a significant encumbrance on the relevant shares, (i.e., a sizeable shareholder loan in the amount of $200,000 to $300,000, significantly impacting the value of the shares because of that associated indebtedness), which the Applicant had not disclosed in her financial statement or in verbal discussion leading to the parties’ agreement underlying the consent order made by Justice Hebner.

3. It was emphasized that, even though the Respondent thereafter indicated his willingness to assume responsibility for the previously undisclosed indebtedness associated with the relevant shares, and follow through on the share transfer arrangement despite the shares having a significantly reduced value, his willingness to do so, (and sign any share transfer documentation in that regard), actually was insufficient to complete the transaction and such that his delayed signature on the draft documentation actually was immaterial to the share transfer arrangement being implemented; i.e., insofar as the other shareholders actually were refusing to agree to the proposed share transfer, as was their right under the shareholder agreements. Indeed, it was that reluctance/refusal of the non-party shareholders to approve the contemplated transfer arrangement that prompted the proposed amendments to the draft share transfer documentation prepared and forwarded by counsel for the Applicant; i.e., with those proposed amendments actually being requested by those other shareholders to address and rectify the situation created by the Applicant’s attempt to transfer her shares without complying with the provisions of the relevant shareholder agreements. In that regard, the Applicant failed and/or refused, in particular, to provide the other shareholders with requested mutual releases and/or a brief affidavit confirming that she had not encumbered the shares.

4. In the result, it was said, the share transfer arrangement was not delayed or “held up” by the Respondent. It was instead delayed by the other non-party shareholders, who initially refused to agree to the share transfer in the manner proposed by the Applicant, and by the Applicant’s refusal to agree to the amendments to the arrangement requested by those other shareholders. More generally, it was emphasized that implementation of the share transfer agreement effectively was beyond the power or legal ability of the Respondent. For example, and without limiting the generality of the foregoing:

a. as a non-party to the existing shareholder agreements, the Respondent lacked the ability to force shareholder compliance with those agreements;

b. as a non-shareholder in the relevant corporations, the Respondent lacked the ability to call a meeting of the shareholders or force the shareholders to do so, in order to address and resolve the impasse; and

c. as a practical matter, the Respondent was in a vulnerable position insofar as he lacked the ability to pressure the non-party shareholder Mr Patel, (effectively the Respondent’s employer as well as a close personal friend of the Applicant, whom the Applicant was said to call “uncle”), to agree to the contemplated share transfer arrangement.

5. More generally, it was argued that the costs of the share transfer arrangement now being sought by the Applicant, (and associated costs incurred by the Respondent as well), were entirely “disproportionate” and “not foreseeable”, and that the Respondent would never have agreed to the arrangement underlying the consent order made by Justice Hebner had he known of the Applicant’s misrepresentations, lack of disclosure and future lack of cooperation, even though the Applicant was in effective control of implementing the share transfer arrangement. In that regard, it also was emphasized that the Respondent’s former counsel had explained that the costs of the share transfer arrangement, which the Respondent agreed to pay, would be “nominal”; i.e., with a quotation of $2,500” being provided to the Respondent in that regard.

6. The Respondent categorically denies the Applicant’s allegation, (characterized by the Respondent as “untrue and baseless”), that he intentionally delayed transfer of the shares, (e.g., by refusing to execute documentation provided by the Applicant), in order to conceal income and thereby avoid increased child support obligations. In that regard, it was emphasized, (and not challenged or contradicted by the Applicant by way of reply), that:

a. the Respondent already has been paying child support based on the anticipated share transfer and associated income; child support which was not reduced when formal transfer of the shares was delayed; and

b. the Respondent also consented to a retroactive increase of child support in the amount of $24,132.

6Reflecting the above disparate contentions, the parties have similarly disparate positions as to how their dispute regarding costs associated with the share transfer arrangement should be resolved. In particular:

a. The Applicant seeks primary cost reimbursement from the Respondent in that regard totalling $20,372.78, (i.e., the total of the documented invoices paid to three law firms since the making of the relevant consent order by Justice Hebner), as well as $2,218.76 in costs associated with the preparation of submissions in relation to this remaining cost dispute. Those requests were said to be “reasonable and proportionate to the length and nature of the Respondent’s non-compliance”.

b. The Respondent characterizes the Applicant’s cost requests as entirely disproportionate, (having particular regard to the Applicant’s failure to ensure compliance with her shareholder obligations regarding share transfers, her effective misrepresentations in that regard, and her subsequent behaviour and lack of cooperation in terms of moving the share transfer arrangement forward to completion), and asks that the Applicant be directed to pay the Respondent costs in the amount of $5,000.00; i.e., as “costs thrown away on this issue” by the Respondent. In that regard, the Respondent indicates and emphasizes, (albeit without the tendering of any legal invoices or bill of cost documentation of his own), that the actual legal fees he has had to incur in that regard, (through the retention of corporate counsel, civil litigation counsel and a corporate accountant, in addition to his family law counsel), total more than $25,000. More generally, it was emphasized that the Respondent has been “exhausted and financially depleted” by the Applicant’s conduct and expenses related to the share transfer process, and that he should not be required to pay the Applicant’s “inflated legal fees that were incurred as a result of her misrepresentations”, and ensuing complications and delays attributable to the Applicant.

Analysis

7The court’s general inherent and broad jurisdiction regarding costs, reflected in s.131(1) of the Courts of Justice Act, R.S.O. 1990, c.C.43, obviously has been shaped and circumscribed in contexts such as this by Rule 24 of the Family Law Rules. While I will not reiterate that rule in its entirety here, suffice it to say that I am mindful of all its provisions, which should be considered incorporated in these reasons by way of reference.

8I also mindful of various guiding principles of interpretation and application in that regard which have developed in the jurisprudence, which include but are certainly not limited to the following:

a. While “success” is the usual starting point in any determination of costs in the family law context, there obviously are other factors which must be carefully considered, including efforts to settle or resolve disputes without further litigation, and conduct of the parties.⁵ In particular, as the wording of Rule 24(14) makes clear, proportionality and reasonableness generally are the touchstone considerations to be applied in fixing costs. In that regard, it should be remembered that proportionality is a core principle that not only governs the conduct of proceedings generally, but is specifically applicable to fixing costs in family law cases.⁶

b. Although Rule 24 has circumscribed the broad discretion on costs conferred by s.131(1) of the Courts of Justice Act, supra, it has not completely removed a trial judge’s discretion. The financial means of an unsuccessful party, the reasonableness of the successful party’s bill of costs and the behaviour of the successful party are factors that may rebut the presumption that a successful party is entitled to costs, and move the court to exercise its discretion.⁷

c. Without limiting the generality of the foregoing, the range of considerations listed in Rule 24 still provides considerable leeway for the exercise of discretion when determining costs in the family law context. Moreover, Rule 24(14(b), allowing the court to consider “any other relevant matter” in setting the amount of costs in relation to a step in the case, read in conjunction with s.131(1) of the Courts of Justice Act, supra, confirms a remaining discretion to award costs that appear just in the circumstances of the case while giving effect to the rules.⁸

d. Cost awards, at the end of the day, should reflect what the court views as a fair and reasonable amount that should be paid by unsuccessful parties.⁹ In that regard, it should be remembered that costs are both a discretionary indemnification device and a mechanism by which abuses of the court’s processes may be deterred and penalized. In particular, costs are routinely used to reward or sanction the conduct of parties prior to and during the litigation process. From a multi-purpose perspective, costs are a means by which the ends of justice are attained.¹⁰

e. Insofar as allegations of bad faith and unreasonable conduct relevant to cost determinations are concerned:

i. It must be remembered that there is a difference between bad faith and unreasonable litigation behaviour. Even seriously unreasonable behaviour will not amount to bad faith unless such conduct is carried out with an intent to inflict emotional or emotion harm on other party, (as demonstrated by evidence confirming an element of deliberate malice or intent to harm), to conceal information relevant to the issues, or to deceive the other party or the court. A finding of bad faith is therefore rarely made, having regard to that high threshold for doing so. While non-disclosure may constitute unreasonable litigation conduct, it therefore usually does not, on its own, amount to bad faith. Similarly, a misguided but genuine intent to achieve an ostensible goal does not constitute bad faith; nor is bad faith synonymous with bad judgment or negligence. Evidence of conscious wrongdoing because of a dishonest collateral purpose or moral obliquity, (e.g., intentional duplicity, obstruction or obfuscation), is required.¹¹

ii. Even unreasonable and self-entitled behaviour “bordering on the outrageous” therefore has been found to fall short of the type and level of misconduct required for a finding of bad faith.¹²

iii. Moreover, as the standard for establishing bad faith is high, and requires certain findings on an established evidentiary basis, a conclusion of bad faith usually is not possible in a context devoid of sworn evidence allowing a judge to make findings of credibility.¹³

iv. Inattentiveness to the general obligation to provide proper disclosure in the family law context, falling short of bad faith, nevertheless often will constitute, at a minimum, unreasonable behaviour; i.e., with inadequate disclosure frequently giving rise to cost consequences. Nor does an opposing party’s failure to pursue requests in that regard, by way of motion or otherwise, reduce the non-disclosing party’s exposure to cost consequences for failing to provide necessary financial information; i.e., insofar as appropriate financial disclosure must be made even without a formal request, let alone a motion for disclosure.¹⁴

v. Unreasonable behaviour, (including capitulation after responsibility for prolonged delay and rejection of resolution proposals), also may be a compelling circumstance justifying an award of costs following a settlement.¹⁵

9Returning to the circumstances of this particular case:

a. As noted at the outset, this is not a case where any cost entitlement or quantification turns on an adjudicated outcome, in turn giving rise to any established baseline for characterization of the Applicant or the Respondent as the “successful party” or considerations of “divided success”, as far as the specific and narrow question regarding costs before me is concerned. Again, the question before me is squarely focused on the parties’ agreement, reflected in the consent order made by Justice Hebner on July 12, 2019, whereby the Respondent was to be “solely responsible” for “any cost and/or tax liability” associated with the transfer of shares the Applicant was to make to the Respondent.

b. I am mindful of observations, relied upon by the Respondent, that consent judgments generally should be approached and interpreted according to the principles of contractual interpretation because they are a species of contract; i.e., not a judicial determination of the merits of a case, (i.e., a judge’s determination of what is fair and reasonable in the circumstances), but only an agreement elevated to an order on consent.¹⁶ The analytical focus in such cases therefore arguably should be on a determination of party intentions in that regard.¹⁷ Having said that:

i. It has been said that, in relation to contract interpretation, nothing is more important, nor more often lost sight of, than the proper aim of the court in relation to such matters. In particular, the court is not to remake the contract for the parties or to tell them what they should have written. Still less is it to give a fair or just result. That may be the aim in relation to torts. However, in relation to party agreements/contracts, the parties effectively are the “legislators”, and their “decree”, reflecting their intentions, generally must be followed. If the parties have indicated in their contract what is to be the result, then that result is to be followed, whether it seems a wise or just result or not, as doing otherwise undermines reasonable expectations, certainty, stability and predictability, and leads to unfairness. There are a number of more specific applications that follow from that basic approach, but they include the following:

1. If the literal meaning of the contract is clear, then it generally must be followed, and there is really no room left for construction. In particular, where the parties have expressed their intentions in an unambiguous way, there are no “gaps” to be filled by the court’s implication of additional terms.

2. The parties’ words are to be read in context, but generally construed according to ordinary grammatical usage and common understanding.

3. In the absence of some clear indication to the contrary, the words agreed upon by the parties are to be read objectively and given their common and popular meaning; i.e., as they would be understood by a reasonable person as familiar as necessary with the circumstances and likely shared understanding of the parties. Without limiting the generality of the foregoing, unless words have a special or technical meaning, one cannot give extrinsic evidence that the common and popular meaning of words chosen by the parties was not the meaning intended. Generally, the subjective intentions of only one of the parties to an agreement, and the idiosyncratic meaning he or she may have attributed to certain wording are irrelevant.¹⁸

4. On an exceptional basis, if the literal meaning of words chosen by the parties would produce complete absurdity, (e.g., an unrealistic result or a result which would not be contemplated in atmosphere in which an agreement was negotiated), then it is reasonable to presume to presume that the parties could not have intended such absurdity, and to look for the more convenient of alternate readings or the most likely alteration required to make in the words used to remove the absurdity. However, the exception is regarded as a dangerous one for the court to employ, as absurdity is inherently a question of degree, and if application of the exception is not reserved for the “most extreme cases”, it arguably would completely subvert the whole process of construction and destroy all freedom of contract in a surreptitious and unpredictable manner. In particular, an absurd result is one neither party possibly could have intended; it is not a result the judge does not like, or a result favourable to one party and not the other.¹⁹

ii. While contract validity requires that an agreement’s terms are either certain or capable of being made certain, it should be remembered that a contract deliberately and permissibly may allow some elasticity in quantification, or as to the precise scope of certain terms whose meaning is clear but whose breadth is not.²⁰

iii. It also should be remembered that parties exercising freedom of contract are free to allocate a particular risk to one party or the other, which arguably includes a risk that costs for which one party is assigned responsibility may prove to be higher than expected. Where that risk then materializes, to the possible detriment of the party by whom it was to be borne by the terms of the contract, the court generally will respect the parties’ intentions and agreement in that regard and properly refuse relief from the consequences of that agreed obligation.²¹

c. Moreover, although consent judgments generally may be approached and interpreted according to the principles of contractual interpretation because they are a species of contract, in my view the fact and specific nature of their incorporation into a formal order of the court is not irrelevant but has consequences. Without limiting the generality of the foregoing:

i. While various considerations give rise to possibilities of agreement rescission and/or adjustment in the context of pure contract claims, (e.g., owing to fraudulent or innocent misrepresentation or mistake), the fundamental reality in the current situation is that I am presented with a formal order of the court, made by Justice Hebner, which was never appealed or made the subject of a motion to change properly brought on notice pursuant to Rule 25(19) of the Family Law Rules. While the written submissions of the Respondent contain a brief and cryptic indication that the Respondent was “unable to bring a motion to set the Order aside for misrepresentation”, no further explanation is provided in that regard. In the circumstances, the situation presented essentially is one of an existing and formally unchallenged court order presented for enforcement. In my view, the time for properly questioning or challenging that order, (made almost seven years ago) has long since passed, especially now that the matter has proceeded to trial and settlement. The order instead must be accepted, respected and enforced.

ii. The particular provisions of the order under consideration nevertheless focus on a particular aspect of the parties’ agreement which inherently is a matter still falling within a specialized aspect of the court’s ongoing and overriding jurisdiction and discretion; i.e., assessment/quantification of appropriate costs to be awarded in relation to a specified step in litigation. In my view, those provisions thereby effectively incorporated, if only by implication and/or reference, party acceptance that such cost quantification, (if required by the court in the event of a dispute), would be governed by the rules and principles guiding the court’s exercise of jurisdiction in relation to such cost determinations in the family law context.

d. Again, for ease of reference, the relevant provisions of the parties’ agreement, reflected and embodied in paragraph 4 of Justice Hebner’s order of July 12, 2019, read as follows: “AND THIS COURT ORDERS THAT the Applicant, Samira Zaki’s shares in 2415411 Ontario Ltd. And 2418715 Ontario Limited shall be transferred to the Respondent, John Kimball Change. If there is any cost and/or tax liability with said Transfer the Respondent shall be solely responsible for same”. In my view:

i. Those relevant provisions of the parties’ agreement reflected and embodied in Justice Hebner’s order, read in their entire context, are clear and unambiguous; i.e., insofar as the words have no apparent special or technical meaning, and a reasonable person, understanding the basic underlying context, and giving those words chosen by the parties their common and popularly understood meaning, readily would understand that the relevant shares currently owned by the Applicant were to be transferred to the Respondent and that the Respondent was to be responsible for the costs and tax liabilities associated with that transfer.

ii. Moreover, in my view, the meaning of those fundamental obligations embodied in those provisions was clear even if the precise breadth of those obligations was not. Without limiting the generality of the foregoing, the precise manner and mechanism of share transfer were not specified, and the extent of the Respondent’s responsibility for cost and tax consequences of the transfer had yet to be quantified. However, as noted earlier, parties to an agreement are permitted elasticity in relation to such matters, so long as the fundamental nature and meaning of defined underlying obligations is reasonably clear.

iii. I see no established basis for interfering with the fundamental terms of parties’ agreement in that regard, or the court order reflecting and embodying that agreement. In particular, I see no basis for effectively negating the Respondent’s responsibility for costs associated with implementing the share transfer. Having said that, I also think, (for reasons already noted), that the parties’ agreement, reflected and embodied in the consent order made by Justice Hebner, essentially recognizes and preserves the court’s jurisdiction regarding the quantification of the Respondent’s cost obligation in that regard, according to the general legislated provisions and principles outlined above.

e. Returning to those aforesaid cost rules and principles, and their application in this particular instance:

i. I already have noted my view that “success” and “divided” success effectively are not available or useful determinants of cost entitlement in the present circumstances. In particular, the Applicant’s entitlement to costs associated with the share transfer flows from the parties’ agreement and the corresponding consent order made by Justice Hebner, rather than any adjudicated outcome.

ii. In my view, the particular circumstances before me also do not warrant a finding of “bad faith” on the part of either party. Without limiting the generality of the foregoing:

1. For the reasons outlined above, I think the court should be reluctant to make deliberately rare and damning findings of bad faith in the absence of sworn evidence and credibility findings, and those elements are absent in the current context.

2. While the Respondent suggests that the Applicant should be faulted for failing to disclose information relating to potential liabilities associated with the relevant shares, and/or her failure to indicate that requisite approval from other shareholders to the contemplated share transfer had not yet been obtained or would be problematic, in my view the assertions made in the written submissions, even if substantiated, fall short of establishing the requisite malevolent intent or pursuit of a collateral purpose, or deliberate concealment, required for a finding of bad faith. In particular, the Applicant’s assertion that she personally has never obtained any financial benefit from retention or ownership of the relevant shares, and that all benefits in that regard always have flowed to the Respondent alone instead suggests no discernible basis for any desire on the part of the Applicant to delay or complicate formal transfer of the shares. While the Applicant’s conduct in that regard may at times have reflected naivete, bad judgment or negligence, (for reasons noted below), I see nothing in the circumstances, even as alleged, to suggest any conscious wrongdoing or pursuit of a dishonest purpose on the part of the Applicant.

3. While the Applicant suggests that the Respondent should be faulted for delay in signing the share transfer documentation prepared by her corporate counsel, and that such delay reflected conscious wrongdoing and/or pursuit of a dishonest collateral purpose on the part of the Respondent, (e.g., concealment or minimization of the Respondent’s income to avoid child support obligations), so as to justify a finding of bad faith, I disagree. Without limiting the generality of the foregoing:

a. The Respondent’s emphatic denial of such wrongdoing and/or dishonest collateral purpose, and his indication that he already has been paying child support on a basis premised on transfer of the relevant shares, (supplemented by an agreement to pay retroactive child support), were not challenged by way of reply. Having regard to those unchallenged assertions, in my view the written submissions, taken as a whole suggest no rational basis for the Respondent wishing to delay a formal transfer of the shares. That inference is buttressed by correspondence sent by Respondent counsel, actively pressing the Applicant and her counsel for completion of the share transfer and threatening contempt proceedings if the Applicant failed to move matters forward in that regard.

b. In my view, it seems clear that the fundamental underlying impediment to the share transfer agreement proceeding in a timely way actually was the reluctance and/or refusal by the non-party shareholders to approve the contemplated share transfer; a situation that, according to the oral submissions I received when the matter was called for trial, effectively prevailed and continued even up until the second day of trial. In such circumstances, I agree with the Respondent’s submission that it really would not have mattered if he had gone through the motions of “signing off” on the draft share transfer documentation prepared by the Applicant’s corporate counsel when it originally was received by him or thereafter; i.e., so long as it remained clear that the non-party shareholders were not agreeing and would not agree to the proposed transfer without concerns expressed on their part being addressed to their satisfaction. In that regard, I note that the Respondent’s assertions that he had received such indications of disagreement from the other shareholders, that he made efforts to seek clarification and resolution from those other shareholders, and that his ability to pursue resolution of the other shareholders’ concerns effectively was constrained and limited, also were not challenged by way of reply submissions from the Applicant.

iii. While the circumstances may fall short of establishing “bad faith” on the part of either party, in my view there are still indications of unreasonable litigation conduct. Without limiting the generality of the foregoing:

1. While it seems likely that the Respondent had some awareness of the corporate structure and shareholder agreements underlying the two relevant corporations, (e.g., insofar as the other two shareholders were his business partners, and correspondence from Respondent counsel indicates that the Respondent had at least some participation in arrangements to provide “buy in” financing and corporate capitalization via shareholder loans), it should be remembered that the Applicant was the only one of the two parties who was a shareholder in the relevant corporations, with full access to information concerning their internal documentation, operation and financial arrangements, all of which were subject to confidentiality provisions confirmed in the relevant shareholder agreements. In such circumstances, it effectively was the Applicant alone, (as between the two parties), who had full access to information regarding the terms and conditions of the shareholder agreements that needed to be fulfilled in order to effect any transfer of her shares, and/or any encumbrances or alleged encumbrances relating to those shares pursuant to the internal financial operations of the corporations.

2. In such circumstances, I think it noteworthy that the Applicant either was ignorant of the encumbrance or alleged encumbrance regarding the shares, (even though she could and should have made inquiries in that regard), or knew about them and failed to make the situation known to the Respondent at the time of the parties’ relevant agreement and the making of the corresponding consent order. In either case, the Respondent’s assertion that the Applicant failed to disclose that potential obligation on her financial statement, as part of her ongoing disclosure obligations in the family law context, was not challenged by way of reply submissions.

3. In such circumstances, I also think it noteworthy that the agreement of the parties, reflected and embodied in Justice Hebner’s order, made no reference to the parties’ obligations being subject to the consent of any third party; i.e., the other shareholders of the two corporations. In that regard:

a. Again, it was the Applicant who had rights of full and immediate access to the relevant shareholder agreements to which she was a party. The Applicant therefore knew, or certainly ought to have known, that those agreements contained terms and conditions, (including but not limited to notice and “right of first refusal” provisions vis-à-vis the other non-party shareholders), that needed to be satisfied before there could be any transfer of the Applicant’s shares to the Respondent.

b. In general, our legal system, (in accordance with “plain common sense and fairness”), does not confer on two persons the right to impose liabilities on a third person without that person’s consent. The general rule is that the only persons who are in any way bound by the obligations of a contract are those who are either parties to it, or have somehow agreed to be bound by the arrangement.²²

c. Not infrequently, agreements are concluded subject to the consent of a third party, indicating that the parties do not intend to have any binding obligation at all in the sense contemplated unless and until the relevant third party approves the proposed arrangement. Alternatively, parties effectively may indicate an intention to be bound, with third party approval constituting not a condition of the agreement but of its performance.²³ However, the wording of the parties’ agreement in this case, reflected and embodied in the consent order made by Justice Hebner, suggests no such understood qualifications, limitations or conditions. The parties instead committed to a very definite arrangement whereby the Applicant’s shares would be transferred to the Respondent.

d. In such circumstances, I think it fair to infer, from such fundamental undisputed realities and even without sworn evidence, that there is merit to the Respondent’s assertion that the Applicant, at the time of the parties’ agreement and its embodiment in the consent order made by Justice Hebner, was representing that the Applicant had completed or definitely could complete the process required to comply with the shareholder agreements by which she was bound to secure the approval of the other shareholders to the proposed share transfer. Certainly, the Respondent had no legal ability to bring about that result, insofar as he was not a party to either of the relevant shareholder agreements.

e. Viewing the circumstances in their most charitable light vis-à-vis the Applicant, (i.e., without attributing any deliberate concealment and/or misrepresentation on the part of the Applicant), the Applicant at the very least committed to an agreed transfer of the relevant shares without familiarizing herself with her existing shareholder obligations, and/or with the need for her to comply with the terms and conditions of those obligations to secure the approval of other non-party shareholders, before the contemplated share transfer could be effected; a failure which, in retrospect, led to the substantial impediments and delays associated with finalizing and implementing the contemplated share transfer. In my view, that was irresponsible and therefore unreasonable litigation conduct.

4. I also think the Applicant thereafter adopted an unreasonable litigation position, and therefore engaged in unreasonable litigation behaviour, insofar as she implicitly if not expressly assumed that all responsibility for moving forward with necessary arrangements to complete the share transfer arrangement lay with the Respondent. Without limiting the generality of the foregoing:

a. I acknowledge that the parties’ agreement and the corresponding consent order made by Justice Hebner describe the agreed share transfer obligation in objective terms; i.e., without expressly casting the obligation to implement the transfer on either party. In particular, the relevant provisions of paragraph 4 of Justice Hebner’s order simply indicate that the Applicant’s shares “shall be transferred to the Respondent”.

b. Having said that, in my view the basic underlying legal realities necessarily contemplated the Applicant’s active involvement and participation in that regard. In particular, the relevant shares were owned by the Applicant, and the Respondent had no legal entitlement or ability to essentially “expropriate” the shares and effect their transfer to the Respondent without the Applicant’s involvement and participation. That fundamental reality was compounded by the additional legal reality that it was the Applicant, and not the Respondent, who had obligations that needed to be fulfilled pursuant to the relevant shareholder agreements. In short, even if the Respondent had full access to the internal corporate documents and other financial information of the relevant corporations, (and there is no indication or confirmation of that in the written submissions), he had no unilateral ability to move matters forward in terms of effecting the agreed and ordered transfer of the shares. In that regard, I accept and agree with the Respondent’s stated limitations in that regard, set forth in his written submissions.

c. In such circumstances, and having regard to such realities, I think it was unreasonable litigation behaviour for the Applicant to adopt a posture whereby she felt entitled to essentially sit back and essentially do nothing, from July of 2019 to June of 2020, in relation to implementing the contemplated share transfer. By virtue of the parties’ agreement, the Respondent would have an obligation to reimburse the Applicant for costs incurred in that regard by the Applicant, but it was the Applicant alone who was in a position to move the matter forward; e.g., by taking the steps required by the shareholder agreements to effect a transfer or sale of her shares, if she had not already done so. Initially, however, the Applicant expressly disclaimed any responsibility in that regard. I note in particular correspondence sent by the Applicant’s former counsel on March 7, 2020, referring only obliquely to the existence of “a process whereby the shares will be transferred” to the Respondent, and asserting that the Applicant had “no control over this process”, such that it supposedly was unnecessary for the Respondent and his counsel to raise the issue further with the Applicant.

d. For similar reasons, I do not think it was reasonable for the Applicant to essentially disengage from any apparent further discussion or consideration of proposed amendments to the draft share transfer documents prepared by her corporate counsel when those amendments essentially were being requested by the non-party shareholders, rather than the Respondent, and it was approval by those non-party shareholders that essentially was delaying implementation of the contemplated share transfer. Again, it was the Applicant rather than the Respondent who had contractual rights and obligations in that regard under the existing shareholder agreements. Moreover, where a party undertakes a contractual obligation, the performance of which is dependent on third party approval, the obligation carries with it a duty to co-operate in seeking the third party’s approval.²⁴

5. While the Applicant may have engaged in unreasonable litigation behaviour, in my view the Respondent also was not faultless in that regard. In that regard:

a. I am mindful that, as noted above, the Respondent was no stranger to the other non-party shareholders, (who admittedly were his long-term business partners), and the Respondent apparently had some form of involvement in the initial capitalization of the relevant corporations. If he alone was receiving the financial benefit of the relevant shares, (and the Applicant’s assertions in that regard were not disputed in the Respondent’s responding written submissions), it seems likely that the Respondent had at least some basic knowledge of, and/or indirect access to, information concerning the fundamental shareholder arrangements underlying the corporations, and/or awareness that any transfer of the Applicant’s shares to the Respondent would require some form of involvement and agreement of the non-party shareholders. In such circumstances, to the extent the Respondent chose to make no inquiries in that regard at the time of the parties’ relevant underlying agreement that was embodied in Justice Hebner’s order, such an approach seems characterized by recklessness or wilful blindness in relation to the share transfer complications that might ensue if inadequate steps had been taken to ensure approval of the contemplated share transfer by the other shareholders.

b. The Respondent’s extremely prolonged failure to respond to the Applicant’s provision of draft share documentation, (not denied in the Respondent’s written submissions), is in my view striking and also indicative of unreasonable litigation behaviour. Without limiting the generality of the foregoing, while the Respondent may have been possessed of information that the non-party shareholders were indicating reluctance and/or refusal to approve the proposed transfer, (thereby making the Respondent’s signature on the draft share transfer documentation essentially immaterial for the time being), and the Respondent may have been engaged in bilateral efforts and discussion with the non-party shareholders to seek clarification and resolution of the situation, none of that seems to have been communicated to the Applicant and her counsel in a timely and effective manner. In retrospect, the situation obviously called for timely disclosure as well as co-operative engagement between the parties and the non-party shareholders, (i.e., between all involved and affected parties and non-parties), to discuss and work out a negotiated resolution of the apparent share transfer impasse. In my view, that was especially called for once the non-party shareholders and counsel representing the non-party shareholders was indicating the existence of concerns in that regard that needed to be addressed, but which also were concerns running counter to the stated litigation concerns of the Applicant. Unfortunately, it seems that no coordinated and concerted efforts were made in that regard until the matter literally had reached the door of the trial courtroom.

iv. No issue was taken with the number of lawyers involved or hourly rates charged by counsel retained by the Applicant, and there was no suggestion that the fees and disbursements charged to the Applicant had not been incurred. I independently have no concerns in that regard either. I nevertheless remain mindful of the general reasonableness and proportionality concerns underscored by Rule 14(a) of the Family Law Rules. In that regard, the provisions of the supplied shareholder agreement and draft share transfer documentation, (with or without suggested “red-lined” amendments), makes it clear that the share transfer issue was not only important to the parties but involved an above average degree of complexity; e.g., complexity requiring the involvement of corporate counsel specializing in this area of the law. Having said that, I think it fair to say that the complexity associated with the transaction would have been significantly reduced if the Applicant had taken care from the outset to comply with provisions of the applicable shareholder agreement or agreements, and invited co-operative involvement of the non-party shareholders from the outset and/or thereafter.

v. I also am mindful that the cost responsibility and obligation of the Respondent currently being considered, and requiring quantification, is also limited to costs of the transfer of shares in the two relevant corporations from the Applicant to the Respondent, and does not extend to any other costs of the litigation. In that regard:

1. As noted at the outset of these reasons, counsel expressly indicated, during the course of oral submissions before me on March 10, 2026, that all other cost issues had been resolved. In such circumstances, I think it clear that the Respondent, in the present context, should not be ordered to pay costs of other steps in the litigation beyond the costs of the relevant share transfer.

2. In my view, such considerations presents another significant problem with the current cost claims of the Applicant; i.e., insofar as the invoices she has presented admittedly include costs associated with steps in the litigation other than costs of the share transfer; time which, (for the most part), admittedly cannot be separated from time spent on the share transfer issues. The implications of that in the present context are significant, insofar as there were clearly other substantive issues, (e.g., child support and summer parenting), which remained outstanding and unresolved until the matter was called for trial. Ordering the Respondent to provide reimbursement for the costs incurred by the Applicant in that regard inherently would involve the provision of cost compensation beyond the focus of this immediate and limited exercise; i.e., resulting in inappropriate over-compensation for the remaining costs in dispute. In that regard, I have no doubt that the share transfer arrangement was identified as an outstanding issue at all the court appearances from the time of Justice Hebner’s order onwards, up until the issue was resolved when the matter was called for trial. However, given the apparently intransigent position of the parties during that time period, in relation to the share transfer arrangements, and the reality that the issue realistically could not be addressed and resolved without the involvement of the non-party shareholders, (who normally would not have participated directly at the conferences and other court attendances, and who apparently became actively and directly involved in final resolution discussions and measures to address and resolve the share transfer arrangement dispute only when the matter was called to trial), I find it difficult to imagine that the share transfer issue involved much in the way of productive or extended discussion during those additional conferences and court attendances before trial.

10As indicated earlier, cost determinations made after settlement are a notoriously imperfect exercise, and in my view this situation easily falls within that description; e.g., insofar as I am obliged to proceed solely on the basis of written cost submissions and limited documentation after the fact, rather than by way of a complete and sworn evidentiary record that led to any formal adjudication of the parties’ dispute.

11It also has been said many times, and in many ways, that the court’s exercise of cost discretion, although guided by rules and principles in the manner outlined above, is inherently more of an art than a science.

12Having regard to all the circumstances of this particular case, including but not limited to the specific considerations and concerns identified above, I think justice will be done if the Respondent is ordered to pay the Applicant a total of $12,000.00 in costs relating to the share transfer arrangement.

13Although the Applicant also has asked for costs of this particular exercise, (by way of a separate Bill of Costs), the final outcome of this dispute addressed in writing was mixed; i.e., insofar as the Applicant succeeded in obtaining an award of costs in that regard, (whereas the Respondent was contending that costs should be payable to him instead), but the amount of costs awarded to the Applicant fell significantly short of what the Applicant was seeking.

14In the result, an order shall go requiring the Respondent to pay the Applicant a total of $12,000 in costs relating to the share transfer arrangement and this hearing in writing.

Ian F. Leach

Footnotes

1. 1See, for example, Ball v. Ball, [2014] O.J. No. 5838 (S.C.J.).
2. 2See Urin v. Rivadeneyra, [2017] O.J. No. 6545 (S.C.J.).
3. 3I was not supplied with any copy of the formal shareholder agreement relating to 2418715 Ontario Limited, although there were indications in the written submissions, (some of which are noted below), that the two agreements were/are similar in nature. Certainly, nothing in the submissions or material supplied to me suggested that any significantly different situation or approach to share transfers applied or was required in relation to the two corporations.
4. 4While a full record of the court proceedings in relation to this matter is not available to me, the Respondent’s written submissions, (not challenged or contradicted by way of reply), indicate multiple further settlement conferences and court attendances in August, October and December of 2022, as well as in February and March of 2023, all of which seems likely to have been followed by a trial management conference at some point prior to the matter being placed on the March 2026 trial list in Woodstock.
5. 5Reimer v. Appa, [2001] O.J. No. 1793 (S.C.J.).
6. 6Beaver v. Hill, 2018 ONCA 840.
7. 7M.(A.C.) v. M.(D.), 2003 CanLII 18880 (ON CA), [2003] O.J. No. 3707 (C.A.).
8. 8Feng v. Philips, 2006 CanLII 13769 (ON SC), [2006] O.J. No. 1708 (S.C.J.); and Cawdrey v. Cawdrey, [2011] O.J. No. 592 (S.C.J.)
9. 9Serra v. Serra, 2009 ONCA 935.
10. 10Olaveson v. Olaveson, 2007 CanLII 45917 (ON SC), [2007] O.J. No. 4195 (S.C.J.).
11. 11S.(C.) v. S.(M.), 2007 CanLII 20279 (ON SC), [2007] O.J. No. 2164 (S.C.J.), affirmed {2010 ONCA 196, 2010] O.J. No. 1064 (C.A.); Fielding v. Fielding, [2019] O.J. No. 569 (S.C.J.); D.(D.) v. G.(H.), [2020] O.J. No. 1850 (S.C.J.); Hughes v. Hughes, [2024] O.J. No. 803 (S.C.J.); K.(K.) v. M.(M.), [2024] O.J. No. 749 (S.C.J.) and Ricketts v. Ricketts, [2024] O.J. No. 1029 (S.C.J.).
12. 12K.(F.) v. K.(A.), [2020] O.J. No. 3456 (S.C.J.).
13. 13Bourgeois v. Bourgeois, [2011] O.J. No. 3578 (S.C.J.)
14. 14See Benzeroual v. Issa, [2017] O.J. No. 5385 (S.C.J.).
15. 15Hassan v. Hassan, [2019] O.J. No. 839 (S.C.J.).
16. 16See James G. McLeod’s annotation to Thomsett v, Thomsett, 2001 BCSC 546; and Johnston v. McLean, 2024 ONCA 791.
17. 17See Shih v. Shih, 2017 BCCA 37; and Johnston v. McLean, supra.
18. 18In that regard, I note in passing that I do not find the Respondent’s indications regarding his previous counsel’s estimate or representation as to the likely quantum of costs associated with the agreed transfer to be compelling or relevant, as far as the current dispute between the parties is concerned. If the Respondent was misled by his own counsel’s estimate or representation in that regard, his remedy lies elsewhere. The Respondent’s subjective expectations in that regard are not relevant to a determination of what both parties intended.
19. 19See J.E. Coté, An Introduction to the Law of Contract, (Edmonton: Juriliber Ltd., 1974), at pp.147 and 150-151; and John Swan, Canadian Contract Law, (1st ed.), (Markham, Butterworths, 2006), at pp.489-492, and 531. See also S.M. Waddams, The Law of Contracts (8th ed.). (Toronto: Thomson Reuters, 2021), at p.347-348; i.e., emphasizing that, although courts have employed various flexible techniques to control the use of perceived “unfair” provisions in contracts, (such as fundamental breach, adverse construction, strict construction, construction contra proferentum, and implying terms into contracts), such tools tend to oppose the values represented by certainty, stability and predictability, if the court is free to alter the apparent meaning of contracts. In this particular case, the costs actually incurred by the Applicant may be characterized by the Respondent as disproportionate and/or unreasonable, but in my view they are not something capable of being regarded as an “absurdity” in the sense required to deviate from the parties’ agreement on such an exceptional basis.
20. 20See Cote, supra, at p.33.
21. 21See Waddams, supra, at p.259.
22. 22See Coté, supra, at p.163.
23. 23See Waddams, supra, at pp.40-41.
24. 24See Waddams, supra, at p.41.