2016 ONCJ 303, 2016 ONCJ 303

COURT FILE NO.: 465/09 DATE: 2016-02-04 CITATION : Lawson v. Mikkelsen-Vestrocy , 2016 ONCJ 303 ONTARIO COURT OF JUSTICE RE: James LAWSON, Applicant Josa-Lynn MIKKELSEN-VESTROCY, Respondent BEFORE: S. O’Connell COUNSEL: Jeff Rechtshaffen, for the Applicant Julie K.A. Quirt, for the Respondent C O S T S E N D O R S E M E N T: Introduction: [ 1 ] The applicant father brought a motion for contempt of court and also for an order for police enforcement of the access provisions of the order dated November 27, 2013.

There were numerous attendances pertaining to these motions as a result of a number of ongoing children’s aid society and police investigations with respect to the allegations raised by the respondent mother. At the conclusion of these investigations, the protection concerns regarding the father raised by the mother were not verified. The father’s motion for contempt was heard on July 29, 2015. [ 2 ] For oral reasons delivered, I declined to make a finding that the respondent mother was in contempt of court and dismissed the father’s motion for contempt.

The parties entered into a temporary consent order on that day in accordance with the recommendations of the Office of the Children’s Lawyer. The parties also consented to include a provision for the police enforcement of the father’s access in the temporary consent order. [ 3 ] Both parties are now seeking their costs of the contempt motion. Both counsel have filed written submissions and bills of costs. Position of the Applicant Father: [ 4 ] The applicant father (“the father”) submits that pursuant to Rule 24 (6) of the Family Law Rules , he achieved divided success on his motion for contempt.

However he is claiming costs on a full indemnity basis and seeks costs in the amount of $32,309.62, in accordance with subrules 24(4), (5) and (8) of the Rules . [ 5 ] It is his position that the mother has acted in bad faith throughout these proceedings and that her “gross abuse of public services, including the Hamilton Children’s Aid Society, the Hamilton Family and Child Services, the Hamilton Police and the Child Advocacy and Assessment Program must be condemned without qualification”.

He submits that the father’s parents, who are of modest means, have spent over $32,000 in legal fees and disbursements in the contempt proceedings. [ 6 ] He submits that the mother, in initiating three child protection proceedings with respect to the father and his family, actively undermined the father’s relationship with the child and placed the child at risk of emotional harm as a result of her conduct.

He further submits that the mother’s conduct was solely designed to marginalize the father as a parent to the child and that the Office of the Children’s Lawyer’s investigation and report of the issues of custody and access corroborates this position.

[ 7 ] According to the counsel for the father, “a strong and consequential costs order will send a clear message to the respondent mother and to family court litigants across the Province that government services such as the CAS, the police, as well as publicly funded counseling services, are not to be misused and abused for strategic purposes.” The Respondent Mother’s Position : [ 8 ] The respondent mother (“the mother”) is seeking costs on a full indemnity basis from the date of her Offer to Settle, dated March 13, 2015, to the hearing of the contempt motion, in the amount of $8, 254.60.

She further submits that there should be no costs awarded for the period prior to her offer to settle being served. [ 9 ] The mother submits that she was completely successful on the motion for contempt. She submits that the father’s regular access with his daughter was interrupted in 2014 because of the mother’s genuine concerns about her daughter’s welfare.

She contacted the police and child protection agencies given her concerns about her daughter. [ 10 ] The mother further submits that as soon as the police and the children’s aid society closed their files, the mother made a reasonable offer to settle the contempt proceedings.

She served an offer to settle permitting the father to withdraw his contempt motion with no costs payable and in addition, offered make-up access weekends to the father for the visits that were missed as a result of the ongoing investigations. [ 11 ] It is the mother’s position that this was a reasonable and child-focused offer which should have been accepted. Substantial legal costs were then incurred by the mother in the following months in continuing to defend the contempt motion.

She further submits that the father’s refusal to accept the offer to settle appears to be motivated by a desire to punish the mother rather than focus on what is in the child’s best interests. The Law and Governing Principles: [ 12 ] Rule 24 of the Family Law Rules, O. Reg. 114/99, governs the determination of costs in family law proceedings and the sections relevant to the circumstances of this case are as follows: “ 24.

(1) There is a presumption that a successful party is entitled to the costs of a motion, enforcement, case or appeal.

(4) Despite subrule (1), a successful party who has behaved unreasonably during a case may be deprived of all or part of the party's own costs or ordered to pay all or part of the unsuccessful party's costs.

(5) In deciding whether a party has behaved reasonably or unreasonably, the court shall examine, (

a) the party's behaviour in relation to the issues from the time they arose, including whether the party made an offer to settle; (

b) the reasonableness of any offer the party made; and (

c) any offer the party withdrew or failed to accept.

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

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

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

(10) Promptly after each step in the case, the judge or other person who dealt with that step shall decide in a

summary manner who, if anyone, is entitled to costs, and set the amount of costs.” [ 13 ] Rule 24 (11) provides a further list of factors that a court must consider when setting the amount of costs: “(

a) the importance, complexity or difficulty of the issues; (

b) the reasonableness or unreasonableness of each party's behaviour in the case; (

c) the lawyer's rates; (

d) the time properly spent on the case, including conversations between the lawyer and the party or witnesses, drafting documents and correspondence, attempts to settle, preparation, hearing, argument, and preparation and signature of the order; (

e) expenses properly paid or payable; and (

f) any other relevant matter.” O. Reg. 114/99, r. 24 (11) . [ 14 ] Rule 18(14) and 18 (16) of the Family Law Rules , which address the cost consequences of offers to settle, provide the following: “18(14) A party who makes an offer is, unless the court orders otherwise, entitled to costs to the date the offer was served and full recovery of costs from that date, if the following conditions are met:

1. If the offer relates to a motion, it is made at least one day before the motion date. 2. If the offer relates to a trial or the hearing of a step other than a motion, it is made at least seven days before the trial or hearing date. 3. The offer does not expire and is not withdrawn before the hearing starts. 4. The offer is not accepted. 5. The party who made the offer obtains an order that is as favourable as or more favourable than the offer. 18

(16) When the court exercises its discretion over costs, it may take into account any written offer to settle, the date it was made andits terms, even if subrule (14) does not apply.” O. Reg. 114/99, r. 18 (14) and (16). [15] In Serra v. Serra, 2009 ONCA 395, 66 R.F.L. (6th) 40, [2009] O.J.

No. 1905, 2009 CarswellOnt 2475, at paragraph 8, theOntario Court of Appeal confirmed that costs rules are designed to foster three important principles: (1) to partially indemnify successful litigants for the cost of litigation; (2) to encourage settlement; and (3) to discourage and sanction inappropriate behaviour by litigants. [16] Rule 24 created a new framework for determining costs in family law proceedings.

The presumptive nature of Rule 24 hassignificantly curtailed the court’s discretion regarding costs in family law proceedings and absent compelling circumstances or theexceptions set out in the rule itself, costs are generally awarded to the successful party. The Ontario Court of Appeal in C.A.M. v. D.M.(2003) (ON CA), 67 O.R. (3d) 181 held that while the Rules have not completely removed a judge’s discretion, therules nonetheless circumscribed the broad discretion previously granted to the courts in determining costs.

Courts must not only decideliability for costs, but also the amount of those costs. [17] The court’s role in assessing costs is not necessarily to reimburse a litigant for every dollar spent on legal fees. As was pointedout in Boucher et al. v. Public Accountants Council for the Province of Ontario, , 71 O.R. (3d) 291, 188 O.A.C. 201,48 C.P.C. (5th) 56, [2004] O.J. No. 2634, 2004 CarswellOnt 2521 (Ont.

C.A.), the award of costs must be fixed in an amount that is fairand reasonable for the unsuccessful party to pay in the particular proceedings rather than an exact measure of actual costs to thesuccessful litigant. [18] Further, if a successful party has behaved unreasonably “in relation to the issues from the time they arose (Rule 24(5),” thenpursuant to Rule 24(4), they may be “deprived of all or part of the [their]costs or ordered to pay all or part of the unsuccessful party’scosts.” Behaviour under Rule 24(5) is not restricted to behaviour associated with offers to settle.

See Family Law Rules, Rule 24(4), (5)and 11(b); Lawson v. Lawson, 2004 CarswellOnt 3154 (S.C.J.), para. 44. [19] Rule 24(10) of the Family Law Rules also provides that the judge who deals with a step in a case shall decide who, if anyone, isentitled to costs. It is well established that in order to obtain costs for prior steps, there must be an order reserving those costs to the trialjudge, or to the motions judge. A trial judge or motions judge is not entitled to make an award for costs covering prior steps such as caseconferences and settlement conferences.

Those prior steps are not within the judge’s discretion particularly where there was no order asto costs or the issue of costs was not address. See Family Law Rules, Rules 24(10); Islam v. Rahman, 2007 ONCA 622 , 2007CarswellOnt 5718 (Ont. C.A.) at paragraph 2; Jepson v. Cresnjovec, 2007 CarswellOnt 7255 (O.C.J.) at para. 8; MacIntosh v. MacIntosh,2008 CarswellOnt 655 (S.C.J.) at paras. 22-23 and Debora v. Debora, 2005 CarswellOnt 676 (S.C.J.), para 20. [20] Finally, in deciding the amount of costs to be paid, I must also consider clause 24 (11) (

f) which requires the court to considerany other relevant matter, including the ability to pay costs. See Biant v. Sagoo, , 20 R.F.L. (5th) 284, [2001] O.J.No. 3693. In C.A.M v. D.P. supra, Justice Rosenberg for the Ontario Court of Appeal states the following: “I am also of the view that the financial situation of the parties can be taken into account in setting the amount of the costs award eitherunder Rule 24 or Rule 18.

Thus, while subrule 24(11) enumerates a number of factors that must be taken into account, the person settingthe amount of the costs is directed to take into account "any other relevant matter". I agree with Aston J. in Sims-Howarth at para. 4, thatthe "Family Law Rules demand flexibility in examining the list of factors in subrule 24(11) without any assumptions about categories ofcosts". In my view, a consideration of particular relevance may be the financial position of the parties, especially of an unsuccessfulcustodial parent. See Biant at para. 17 and Brennan v. Brennan, [2002] O.J.

No. 4743 (S.C.J.) at para. 11. In fixing costs the courtscannot ignore the best interests of the child and thus cannot ignore the impact of a costs award against a custodial parent that wouldseriously affect the interests of the child. [par. 42] Analysis and Conclusion: [21] For the reasons below, applying the legal principles above, I decline to make an award of costs to either party. [22] Although I find that the mother acted unreasonably in this proceeding, her behaviour did not amount to bad faith. There is adifference between unreasonable behaviour and bad faith.

"Bad faith" is not defined under sub-rule 24(8) of the Family Law Rules. Thecase law is clear that bad faith is something significantly more than unreasonable litigation behaviour. In one of the leading cases, C.S. v.M.S., (ON SC), [2007] O.J. No. 2164, Justice Craig Perkins explained that bad faith means the following: “In order to come within the meaning of bad faith in sub rule 24(8), behaviour must be shown to be carried out with intent to

inflict financial or emotional harm on the other party or other persons affected by the behaviour, to conceal information relevant to theissues, or to deceive the other party or the court. A misguided but genuine intent to achieve the ostensible goal of the activity, withoutproof of intent to inflict harm, to conceal relevant information or to deceive, saves the activity from being found to be in bad faith.

Therequisite intent to harm, conceal or deceive does not have to be the person's sole or primary intent, but rather only a significant part of theperson's intent." [23] In dismissing the father’s motion for contempt against the applicant mother, I determined that the father had not met the veryhigh standard necessary to prove that the mother was willfully and deliberately disobeying a court order.

I determined that the mother,however misguided or unreasonable her conduct appeared to a reasonable person, seemed to believe that her daughter was at risk in theunsupervised care of the applicant father for members of his family. [24] Although I was very concerned about the respondent mother’s conduct and whether or not that conduct was reasonable, I did notfind her to be consciously and willfully doing something with an intent to harm, conceal relevant information or deceive the court or theapplicant father. [25] Although I do not find that the mother acted in bad faith, as indicated, I do find that the mother acted unreasonably in thislitigation.

The mother made repeated reports to the children’s aid society and to the police regarding allegations about the father’sbrother and the father. The three child protection investigations initiated by the mother did not verify child protection concerns about thefather.

The mother’s conduct created significant anxiety for the child and had a detrimental impact on her relationship with her father.The mother was cautioned by the children’s aid society regarding her repeated reports and was warned that her behaviour was placingMadeline at risk of emotional harm as well as marginalising the father as her parent. [26] In in the Report by the Office of the Children’s Lawyer (OCL) released in July 2015, the OCL investigator did not recommendthat the mother have sole custody of Madeline notwithstanding the fact that Madeline has been in her primary care since birth.

The OCLinvestigator found that the mother “cannot support her child’s relationship with Mr. Lawson and therefore a recommendation of solecustody may serve to further deteriorate the fragile relationship between the father and Madeline”. [27] Nevertheless, the father also acted unreasonably in this litigation. To the mother’s credit, at the conclusion of the final CAS andpolice investigation, the mother, with the assistance of her counsel, served an offer to settle on March 13, 2015. The offer was signed bythe mother and prepared in accordance with Rule 18 of the Family Law Rules.

All five conditions under Rule 18 (14) were met by themother. Her offer to settle was as favourable as or more favourable than the order made in this case dismissing the father’s contemptmotion. [28] As well, upon conclusion of the last children’s aid society and police investigation in March 2015, the mother complied withcourt-ordered access between the father and the child. [29] The father did not accept the mother’s offer, nor did he counter with an offer of his own. The mother’s offer was made fourmonths before the contempt motion was argued. The mother was fully successful on the motion for contempt.

I do not agree that successwas divided. After I dismissed the father’s motion for contempt, the father’s counsel requested a police enforcement clause and therespondent mother consented to the inclusion of such a clause in the temporary consent order with respect to access that the partiesreached on that day. [30] Both the mother and the father incurred significant legal fees regarding the motion for contempt, after the mother’s offer to settlewas served in March 2015.

The failure to serve an offer to settle is an important factor that I should take into consideration in assessingcosts, particularly given the requirements of Rule 18 of the Family Law Rules and the overall objectives and Rule 24(5) of the FamilyLaw Rules, which provides that the failure to make an offer to settle is a factor that the court must consider in determining whether aparty acted reasonably. [31] Justice Stanley Sherr states the following in J.V.M. v. F.D.P. 2011 ONCJ 616 , [2011] O.J.

No. 5441, and I adopt thisreasoning in assessing the costs in these proceedings: “…The failure to make an offer to settle much earlier by either party is unreasonable behaviour. Subrule 2(4) imposes a duty on partiesand their lawyers to promote the primary objective of the rules to deal with cases justly (subrule 2(2)). This includes taking appropriatesteps to save time and expense (subrule 2(3)). Offers to settle play an important role in saving time and expense by promotingsettlements, focusing parties and often narrowing issues in dispute. See Laing v. Mahmoud, 2011 ONSC 6737, [2011] O.J.

No. 5134,2011 CarswellOnt 12972 (Ont. Fam. Ct.). The failure to serve an offer to settle will be an adverse factor when assessing costs.” [32] The father’s counsel acknowledges that the offer to settle was delivered by the mother in March 2015. However, he submits thatthe father at the time “felt that if he were to accept this offer, there would be no police enforcement of access and the Respondent’sconduct would not be sanctioned in any manner.” [33] Respectfully, I disagree.

The applicant father could have served a counter-offer which included a police enforcement clause, anda proposal with respect to the costs incurred by the father up to the date of the mother’s offer to settle, as a result of the mother’sunreasonable behavior. Not to have served any offer to settle defeats two of the three important principles that the cost rules are designedto foster: to partially indemnify successful litigants and to encourage settlement.

It is very regrettable that this was not done. [34] Having said that, although Rule 18 (14) provides that the mother is entitled to full recovery of her costs from the date her offer tosettle was made, I decline to make any cost award in favor of the mother as a result of her unreasonable behavior in these proceedings.The third important principle that the cost rules are designed to foster is to discourage and sanction inappropriate behaviour by litigants.

Iwill not reward the mother’s behaviour with an order of costs notwithstanding her success on the motion for contempt. [35] Accordingly, there will no order for costs to either party.

___________________________ Justice Sheilagh O’Connell DATE: February 4, 2016