CITATION: Spagnolo v. Spagnolo, 2026 ONSC 4174
SUPERIOR COURT OF JUSTICE - ONTARIO
RE:
HALYNA SPAGNOLO, Applicant
AND:
PAUL SPAGNOLO, Respondent
BEFORE:
Justice Susan Vella
COUNSEL:
Galyna Pribytkova, for the Applicant
Alyssa Warias, for the Respondent
HEARD:
In Writing
Costs ENDORSEMENT
[1] This is the costs decision arising from a long trial that proceeded over the course of 9 days (including submissions). It was a hybrid trial which included trial affidavits, limited examinations in chief, and full cross examinations. The court heard from eleven witnesses, including the clinical investigator from the OCL.
[2] The Applicant seeks her costs on a full recovery basis in the sum of $301,514.81 pursuant to Rules 24(7) and (10) (bad faith) or alternatively r. 24(12) (offer to settle) of the Family Law Rules (“FLRs”). In the alternative to the bad faith allegations, she relies on the same alleged conduct as unreasonable behaviour under r. 24(14). Her partial recovery costs are $219,707.33.
[3] The Respondent claims that there was divided success and seeks partial recovery costs in the sum of $219,495.33 or alternatively that no costs be ordered. He submits that he achieved meaningful success on core issues including a rejection of supervised parenting time, achievement of a fixed termination date with respect to spousal support, low range rather than mid-range spousal support, imputation of income to the Applicant, and a structured expansion of his parenting time with leave to bring a motion to change, de novo, if he meets certain conditions set out in the trial Reasons dated January 23, 2026 (the “Reasons”). His full recovery costs are $365,825.56.
[4] The parties acknowledge that this was a complex, multi-issued trial that related, inter alia, to parenting issues, child and spousal support issues (arrears and ongoing, and imputation of income to each party), and equalization involving items in dispute, and including a claim for unequal division of net family property.
Who Achieved “Success” or was Success Divided
1Costs are in the discretion of the court (section 131(1), Courts of Justice Act).
2The four main objectives of costs are to:
(a) Partially indemnity successful litigants;
(b) Encourage settlement;
(c) Discourage and sanction inappropriate behaviour by litigants; and
(d) Ensure that cases are dealt with justly (Mattina v Mattina, 2018 ONCA 867, at para. 10; R. 2(2) of the Family Law Rules).
[5] Rule 24(14) sets out the factors relevant to setting the quantum of costs. However, the rule specifically emphasizes “reasonableness and proportionality” in fixing a costs award (R. 24(14)(a), Mattina, at para. 10; Beaver v Hill, 2018 ONCA 840, at para. 4).
[6] The first issue to resolve is who achieved success. Whomever achieved overall success is presumptively entitled to their costs (24(3), Family Law Rules/”FLRs”). Success is a relative concept. This presumption may be displaced under the FLRs.
[7] Neither party achieved total success on the main issues before the court. However, that is not the measure for assessing who achieved overall success.
[8] Rule 24(4) provides that where there is “divided success”, the court may apportion costs as appropriate. Consistent with the general principle underlying the discretion to award and fix costs, the court has broad discretion in determining whether there has been divided success and if so, what is the appropriate allocation of costs.
[9] “Divided Success” does not necessarily mean "equal success", while some success may not impact on costs:
(a) Rule 24(4) requires a contextual analysis.
(b) Most family court cases involve multiple issues.
(c) Not all issues are equally important, equally time-consuming or equally expensive to determine.
(d) Comparative success can be assessed in relation to specific issues:
(i) did a mid-point number prevail on a financial issue;
(ii) did a compromise result on a parenting issue?
[10] Comparative success can also be assessed globally in relation to the whole of the case:
(i) how many issues were there;
(ii) how did the issues compare in terms of importance, complexity and time expended;
(iii) was either party predominantly successful on more of the issues;
(iv) whether either party was more responsible for unnecessary legal costs being incurred.
[11] Where success in a step in a case is divided, the court may exercise its discretion to apportion costs as appropriate (rule 24(4)). The court may also in those circumstances award some costs to the party who was substantially more successful on an overall global basis, absent bad faith (Boland v. Boland, [2012] O.J. No. 1830, 2012 ONCJ 239).
[12] Offers to settle are a measure by which to assess success. In this case the parties’ respective offers to settle are particularly instructive. The Applicant delivered her offer on May 8, 2025 while the Respondent delivered his on or about May 28, 2025.
[13] Contrary to the submission of the Applicant, she did not obtain a result as good or better than the result achieved at trial. While her offer, like the Respondent’s offer, was severable by part, I am concerned with the offer as a whole for purposes of the mandatory cost consequences set out in rules 18 and 24(12), FLRs. Similarly, the Respondent did not obtain a result as good or better than the result achieved at trial when the offer is considered as a whole.
[14] In my view, there was divided success in this case with respect to the parenting issues, and predominant success on the financial issues by the Applicant, based on the trial result as follows.
[15] The Applicant was successful on the following relief she sought:
(a) Sole decision making;
(b) Primary residence of the children;
(c) Imputation of income to the Respondent for support purposes;
(d) Child support, ongoing and arrears (quantum);
(e) Spousal support, ongoing and arrears (quantum);
(f) Equalization payment.
[16] The Respondent was successful on the relief he sought, and contrary to the position taken by the Applicant at trial, on the following issues:
(a) His parenting time will not be supervised;
(b) He obtained an expansion of his parenting time over what the Applicant requested;
(c) Imputation of income to the Applicant for support purposes;
(d) Low range of spousal support (Applicant requested mid range under the SSAGs).
[17] However, the offers to settle also somewhat attenuate the degree of success by each party. For example,
(a) The Applicant offered to accept that the Respondent pay 80% of the s. 7 expenses, but I ordered 78%;
(b) The Respondent offered to provide the Applicant with final decision making authority over significant decisions but only after consultation and an attempt to agree, and that each parent would have day to day decision making when they have parenting time;
(c) The Respondent offered that the children’s primary residence would be with the Applicant.
(d) The Respondent proposed a graduated parenting schedule including eventually overnights (I did not grant overnights, but there is an opportunity for the Respondent to seek overnights on conditions set out in the Reasons).
[18] In my view, there was divided success in this proceeding with respect to the parenting issues, but the Applicant achieved overall success with respect to the financial issues. About half of the time of trial was devoted to each of the parenting and financial issues respectively. As the Applicant achieved overall success with respect to the financial issues, she is presumptively entitled to a portion of her costs on an appropriate basis.
Level of Recovery
[19] The Applicant alleges that she is entitled to costs on a full recovery basis as the Respondent acted in bad faith pursuant to r. 24(8). The Respondent does not make this submission against the Applicant.
[20] The Applicant relies on findings of fact made in the Reasons. Most notably, she relies on my finding that the Respondent breached the orders of Czutrin J dated December 12, 2023 (child and spousal support), Kraft J. dated August 25, 2023 (use of email communication to provide toxic communications) which amounted to family violence (within the context of the parenting issues), and Nakonechny, J. dated March 6, 2025 (failure to comply with the deadlines for filing the trial materials). In addition, the Applicant relies the Respondent’s deficiencies in his financial disclosure throughout the proceedings, Horkins J.’s finding on April 11, 2024 that his behaviour regarding issues involving the sale of the matrimonial home was “appalling”, and allegedly false sworn Financial Statements.
[21] In relation to the Order of Kraft J. dated February 8, 2024, a consent order was issued based on the Respondent’s sworn financial statement that the Applicant would owe him an equalization payment of $200,000. As a result, that sum has been held back from the Applicant pending the release of the judgment reflected in the Reasons. Based on the trial result that saw the Respondent owe the Applicant a considerable equalization payment of $715,591.07, the Applicant urges the court to find that the financial statement used in relation to the consent order was tantamount to an intentionally made false statement.
[22] In order to come within the scope of r. 24(10) of the FLRs, the alleged behaviour must be shown to be carried out with intent to inflict financial or emotional harm on the other party, to conceal information relevant to the issues or to deceive the other party or the court. The court may infer the requisite intent from the surrounding circumstances of the impugned conduct.
[23] In this case I find that the Respondent engaged in unreasonable behaviour but not bad faith with respect to the financial issues involved in this matter. I am not satisfied that the Respondent’s behaviour reaches the high bar for bad faith and that the requisite intent was demonstrated. It is not unusual for the court to make findings that differ with a party’s financial statement, however, that does not automatically mean, without more, that the party intentionally swore a false financial statement.
[24] On the other hand, I also found that the Applicant wrongfully exercised unilateral decision making over the children, regulating and defining the Respondent’s ability to see the children, including cancelling visits and secretly placing a GPS tracker with the children, and videotaping parenting exchanges, and artificially creating a status quo parenting situation. This behaviour is also unreasonable and is a relevant consideration in determining a fair, reasonable and proportionate quantum of costs.
[25] Accordingly, I will assess costs on a proportionate, global, basis in favour of the Applicant, consistent with my findings that there was divided success on the parenting issues, but overall success to the Applicant on the financial issues.
Quantum of Costs
[26] I have considered the factors listed in R. 24(14) of the FLRs. The most relevant factors in this case are the exchange of offers to settle (both delivered in May 2025), the reasonableness of the parties’ respective behaviour, and the impact on the Respondent’s ability to provide for the children a costs award will have. With respect to the latter, I note that the Respondent is nearing retirement age, and is liable for a significant equalization payment which will require him to encumber or sell his property, while being responsible for ongoing child support beyond the age of 65, and spousal support until he reaches his 65years of age.
[27] I also find that the Respondent’s offer to settle the parenting issues was more reasonable than the Applicant’s offer based on the trial results. On the other hand, the Applicant’s offer to settle the financial issues was more reasonable than the Respondent’s offer based on the trial results.
[28] On balance, given the fact that a substantial amount of time was devoted to each of the parenting and financial related issues, with most witnesses giving testimony relevant to both types of issues, as well as the impact of a cost award on the Respondent’s ability to discharge his parenting rights and obligations, I will make a reduced global award of costs in favour of the Applicant. This roughly approximates my valuation of the time devoted to the parenting issues versus the time devoted to the financial issues, and the parenting issues together with the unreasonable behaviour of both parties.
[29] In making my assessment, I note that the Respondent’s full recovery fees are higher than the Applicant’s, and therefore such an award is within his reasonable expectations.
[30] There was no challenge to the number of hours or hourly rates charged by the Applicant’s lawyer.
[31] I am therefore fixing costs in the sum of $110,000 all-inclusive to the Applicant as the fair, proportionate and reasonable result in the circumstances of this proceeding. It will be payable within 60 days, taking into account the submission of the Respondent that he must sell his home and/or liquidate his retirement savings in order to satisfy the equalization payment and any costs award, balanced against his ongoing child and spousal support obligations.
Vella J.
Date: July 17, 2026