Umperville v Vanberg, 2021 ABQB 520

Court of Queen’s Bench of Alberta Citation: Umperville v Vanberg, 2021 ABQB 520 Date: 20210708 Docket: FL01 32812 Registry: Calgary Between: Charles Stephen Umperville Applicant - and - Cindy Vanberg Respondent _______________________________________________________ Endorsement Regarding A

Schedule for the Reimbursement of the Overpayment of Child Care Expenses and Costs of the Application of the Honourable Mr. Justice O.P. Malik _______________________________________________________ I. Introduction [ 1 ] In Umperville v Vanberg , 2021 ABQB 468 , I found that the Respondent could not prove that her child care expenses were properly claimable

section 7 expenses. Consequently, I ordered that the Respondent reimburse the Applicant’s monthly contributions towards those expenses of $900.00 retroactive to January 1, 2018. [ 2 ] I directed that the parties provide me with written submissions if they could not reach agreement on a reimbursement

schedule for the Applicant’s overpayment of child care expenses and on costs of the application. [ 3 ] The parties could not agree and provided me with written submissions on the two issues that I must decide: i. What is an appropriate

schedule for the reimbursement of the Applicant’s overpayment of child care expenses; and ii. Costs.

II.

Schedule for the Reimbursement of the Applicant’s Overpayment of Child Care Expenses [ 4 ] Retroactive to January 1, 2018, the Applicant has paid the Respondent a total of $37,800.00 towards child care expenses ($900.00 X 42 months). [ 5 ] The Applicant owes the Respondent approximately $3,000.00 retroactively for adjustments to child support for the years 2019- 2021.

I agree with the parties that the Applicant’s arrears should be offset against the amount owing by the Respondent. [ 6 ] In the result, the Respondent owes the Applicant $34,800.00. [ 7 ] The Applicant proposes three possible reimbursement schedules commencing September 1, 2021 whereby the Applicant would receive a credit against his monthly ongoing support: i. $870 per month over 40 months; ii. $725.00 per month over 48 months; and iii. $580.00 per month over 60 months. [ 8 ] The Applicant fairly concedes that the reimbursement

schedule must be reasonable and occur over a period time such as not to leave the parties’ child without appropriate support. I agree. He refers me to several cases ( ZAM v AVT , 2018 ABQB 319 at para 67; Sumka v Graham , 2013 ABQB 265 at paras 79-80 ; and Pereira v Richardson at para 104) where reimbursement has been ordered to be credited against a payor’s support obligations. [ 9 ] The Respondent cites from the headnote in Colucci v Colucci , 2021 SCC 24 and argues that applying the reimbursement as a credit against the Applicant’s ongoing support would create hardship for the Respondent.

She proposes that reimbursement should be made by applying a 50% credit in the Applicant’s favor with respect to the cost of future

section 7 expenses. [ 10 ] The Respondent further argues that I should allow her some child care expenses between 2018 to February 2019, when the child started school. [ 11 ] In my view, the Respondent has been unjustly enriched as a result of having received payments that she was not properly entitled to.

I appreciate that the Applicant’s proposal will impact upon the Respondent’s household budget but I cannot ignore the other side of the coin – that the Applicant’s financial circumstances have also been significantly affected throughout the period that these payments have been made and that he is entitled to re-payment within a reasonable amount of time, having regard to the Respondent’s circumstances and the needs of the parties’ child. [ 12 ] Further, I had considered providing the Respondent with a partial entitlement to child care costs but declined to do so on what I took to be a principled basis.

Either the Respondent can prove an entitlement to care expenses or she cannot. I do not accept her evidence that her work

schedule makes it necessary for her to obtain child care nor am I convinced that retaining a full-time nanny is the circumstances is reasonable. While the Respondent cannot prove an entitlement to the entire amount of expenses, she still bears the onus of proving what part of those expenses was properly compensable. In my view, she has not done so and I am not prepared to make an off- the-top adjustment in her favor without proper evidence. [ 13 ] It is agreed by the parties (and I have so found) that the Respondent’s current annual income is $37,000.00.

The Respondent shall reimburse the Applicant with a $400.00 credit to be applied monthly against his ongoing support payments. I acknowledge however, that the parties may need to return to court to re-assess the terms of reimbursement depending on for example, fluctuations in the Respondent’s income (either upwards or downwards) or changes in the Respondent’s life circumstances. III. Costs [ 14 ] The Applicant proposes several approaches for the awarding of costs. These range from costs to be calculated as a multiplier of three times Column 1 of

Schedule C of the Rules with the doubling of costs for steps taken after the expiry of a Calderbank offer for a sum of $45,216.33, to 50% of the Applicant’s solicitor client fees for costs of $27,207.78, to costs of $15,238,83 with a doubling of costs for steps taken after the expiry of the offer. [ 15 ] The Respondent asks that each party pay their own costs and that in the alternative, the Applicant be granted costs in accordance with Item 8 of Column 1 of

Schedule C of the Rules for the sum of $1,000.00. [ 16 ] The granting of costs in family proceedings is in the court’s discretion although I am guided by Rules 10.29(1), 10.31 and 10.33. The successful party is normally entitled to costs while the unsuccessful party is not. I am also mindful of the principles pertaining to Calderbank offers, helpfully explained in Shaw v Shaw , 2014 ABQB 165 at paras 19-29 , and the courts’ decisions referred to me by the Applicant: Nielsen-Daigle v Nielsen-Daigle , 2020 ABQB 84 and in Nissen v Nissen , 2020 ABCA 8 .

In approaching the issue of what a party’s proper indemnification should be, I am guided by the Alberta Court of Appeal’s decision in McAllister v Calgary (City) , 2021 ABCA 25 . [ 17 ] I have reviewed the Applicant’s March, 2021 Calderbank offer. It is in the form of an e-mail sent to the Respondent’s counsel on March 23, 2021 and it expired on March 26, 2021. I find the offer to be clear and precise. The offer explicitly references that it is being made in accordance with Calderbank principles. In my view, the offer is reasonable in its terms and represents a continuation of

the Applicant’s numerous genuine offers of settlement. [ 18 ] Pursuant to Rule 10.29(1), a successful party is prima facie entitled to costs from the unsuccessful party.

In determining what amount of costs should be awarded, the court considers those factors enumerated in Rule 10.33 which include the following: - each party’s success: Rule 10.33(1)(a); - the amount claimed and recovered: Rule 10.33(1)(b); - the importance of the issue being litigated: Rule 10.33(1)(c); - the complexity of the action: Rule 10.33(1)(d); - the apportionment of liability: Rule 10.33(1)(e); - the conduct of a party that shortened the action: Rule 10.33(1)(f). [ 19 ] Following its consideration of Rule 10.33, the Court is directed to proceed to Rule 10.31 which grants the court broad discretion to craft an award that is reasonable and proper: Rule 10.31(1)(a); or that is appropriate in the circumstances: Rule 10.31(1)(b); or that is a combination of both. [ 20 ] In awarding reasonable costs pursuant to Rule 10.31(1)(a), the court can award costs on one or more of the following grounds: - with or without refence to

Schedule C: Rule 10.31(3)(a); - an amount equal to a multiple, proportion or fraction of the amount set out in any column of

Schedule C: Rule 10.31(3)(b); - costs to be paid with respect to a particular issue, application or proceeding: Rule 10.31(3)(c); or - costs to be paid on the basis of a percentage of all, or part of the successful party’s assessed costs: Rule 10.31(3)(d). [ 21 ] Rule 10.31(1)(

b) allows the Court to award “any amount” that it considers appropriate in the circumstances including but not limited an award of costs on the basis of an indemnity for a party’s legal fees or a lump sum instead of, or in addition to, assessed costs. [ 22 ] There is no presumption that costs should be awarded on the basis of the appropriate column of

Schedule C as this would not always produce a costs award that is reasonable. ( McAllister at paras 53-56 ). While

Schedule C provides a rough ballpark of what reasonable costs might approximate in some contexts,

Schedule C should be looked at as one of a number of tools rather than as the default mechanism for determining reasonable costs. [ 23 ] Generally speaking, the purpose of a reasonable and proper costs award pursuant to Rule 10.31(3)(

a) is to provide the successful party with partial indemnification of its costs. In McAllister , the Court of Appeal confirmed that a 40-50% level of indemnification provides a “reasonable guideline upon which the level of indemnification implied by the phrase “reasonable and proper costs” may be measured under the Rules”. ( McAllister at para 51 ). [ 24 ] If a trial judge awards costs on the basis of a percentage indemnity, then either an assessment officer or a judge should consider the reasonableness of the legal services performed and the amounts charged for those services ( McAllister at para 46 ).

Finally, an assessment of the reasonableness of legal costs must also consider Rule 10.2(1). [ 25 ] Having regard to the parties’ submissions on costs and the guidance that I derive from the case law, I award the Applicant indemnification of this application of 50% of his legal fees plus disbursements and GST, and that there be a doubling of costs for steps taken after the expiry of the Calderbank offer. [ 26 ] In my view, the action was neither important in terms of the issues being litigated ( Rule 10.33(1)(c)), nor particularly complex ( Rule 10.33(1)(d)).

The Applicant was entirely successful in terms of the ultimate result ( Rules 10.33(1)(

a) and (b)). The Applicant made numerous efforts to resolve the matter commencing in late 2019, through to the spring of 2020 and shortly prior to the application being heard in May, 2021. Those settlement offers were in all respects reasonable, signifying a true compromise and would, had they been accepted by the Respondent, have brought the application to an end ( Rules 10.33(1)(f), and 10.33(2)(a)). I have no evidence of the Respondent having engaged in offers to settle.

I am surprised, given my rather pointed comments during the parties’ oral arguments, that the Respondent did not moderate her settlement position ( Rule 10.33(1)(g)) as I had given her the opportunity to do prior to rendering my decision. From my perspective, the Respondent has advanced an all-or-nothing approach throughout this litigation and the application which has not, as it turns out, served her well. [ 27 ] I find that providing the Applicant with a 50% level of indemnification of his assessed legal fees is a reasonable and proper costs award to make pursuant to Rule 10.31(1)(

a) having regard to the factors set out in Rules 10.33 and 10.2(1). In light of what appears to be the Respondent’s failure to accept the Applicant’s reasonable Calderbank offer, the Applicant is entitled to a doubling of costs for any steps taken following the offer’s expiry. [ 28 ] The Applicant shall have his costs assessed by an assessment officer in accordance with Rule 10.34. IV. Disposition i. The Respondent owes the Applicant the sum of $34,800.00; ii. Based upon the Respondent’s current imputed annual income of $37,000.00, the Respondent shall reimburse the Applicant with a monthly credit of $400.00 to be applied against the Applicant’s monthly support obligations until the

Applicant is fully reimbursed; and iii. In respect of this application, the Applicant is entitled to an indemnity of 50% of his assessed legal fees plus GST and disbursements, and to a doubling of costs for any steps commencing on March 27, 2021. Submissions on Costs were received by the parties on June 24, 2021. Dated at the City of Calgary, Alberta , July 8, 2021. O.P. Malik J.C.Q.B.A. Appearances: Sandra J. Hildebrand Q.C. for the Applicant, Charles Stephen Umperville Darryl A. Aarbo Q.C. for the Respondent, Cindy Vanberg