LESLIE CRAIG SCHMIDT PETITIONER - v. –, 2023 SKKB 188

KING’S BENCH FOR SASKATCHEWAN Citation: 2023 SKKB 188 Date: 2023 09 08 Docket: DIV-RG-00213-2018 Judicial Centre: Regina BETWEEN: LESLIE CRAIG SCHMIDT PETITIONER - and – KAREN ANNE SCHMIDT RESPONDENT Counsel: Robert J. Taylor for the petitioner Karen A. Schmidt on her own behalf ___________________________________________________________________________ JUDGMENT GOEBEL J. September 8, 2023 ___________________________________________________________________________ Overview [ 1 ] The parties are the parents of two children, Anderson, age 16 and McKenna, age 14.

They began to cohabit in 1996, married on July 26, 2003, and separated on February 24, 2018. [ 2 ] Over the years they have attempted to resolve the legal issues arising from their separation through four-way negotiations with counsel, mediation, written negotiations and competing interim applications. During this time, a number of proposals were exchanged. It is not disputed that at one point the mother agreed to follow a shared parenting arrangement but later changed her mind.

Some time thereafter the parenting and support arrangements proceeded to court and an interim order was made. [ 3 ] Ultimately, the matter was set for trial. Shortly before the trial, counsel for the father served counsel for the mother with a formal offer in accordance with

Part 4 of The Queen’s Bench Rules . At the start of the trial the parties reached an agreement on matters relating to the divorce, spousal support, arrears, retroactive support, determination of the father’s income and family property. A consent judgment was granted on April 14, 2022. It made no mention of costs. [ 4 ] The trial continued on parenting as well as the determination of child support. On January 26, 2023, a judgment was rendered ( Schmidt v Schmidt (26 January 2023) Regina, DIV-RG-00213-2018 (Sask KB)).

With respect to costs, the judgment provided as follows: [166] Given the mixed success in this matter, I am not inclined to make an award of costs. That said, if either party wishes to

pursue a hearing on costs, they shall notify the local registrar of same within the next 30 days by serving and filing written correspondence confirming same and appending a draft bill of costs. [ 5 ] Shortly thereafter the father notified the Local Registrar that he wanted a costs hearing to be scheduled. He also filed a draft bill of costs. The day before the hearing was to take place, counsel for the father filed a written brief seeking enhanced costs, along with copies of written proposals previously exchanged between the parties, and a formal offer served on counsel for the mother shortly before the trial.

Counsel for the mother did not object to this information coming before the Court in this manner. The Legal Framework [ 6 ] The determination of costs in a family matter is discretionary although the Court’s discretion must be exercised judiciously and in keeping with the schematic provided by The Queen’s Bench Rules and the decided cases. In family law matters, the starting point is Rule 15-96, which reads as follows: Costs 15-96

(1) Costs are in the discretion of the Court and, except as modified by this rule, the following provisions apply to the costs of a family law proceeding: (

a) Part 4, Division 4; (

b) Part 11.

(2) Subject to subrule (3), there is a presumption that a successful party is entitled to the costs of a family law proceeding or a step in a family law proceeding.

(3) A successful party who has behaved unreasonably or has acted in bad faith during a family law proceeding may be: (

a) deprived of all or part of the party’s own costs; or (

b) ordered to pay all or part of the unsuccessful party’s costs.

(4) In deciding whether a party has behaved reasonably or unreasonably or in bad faith, the Court may examine: (

a) the party’s behaviour in relation to the nature, importance and urgency of the issues from the time they arose; (

b) any conduct of the party that tended to lengthen unnecessarily the duration of the family law proceeding; (

c) whether any step in the family law proceeding was improper, vexatious or unnecessary; (

d) the party’s denial or refusal to admit anything that should have been admitted; (

e) whether the party made an offer to settle; (

f) the reasonableness of any offer to settle the party made; and (

g) any offer to settle that the party withdrew or failed to accept.

(5) If success in a family law proceeding or a step in a family law proceeding is divided, the Court may apportion costs as appropriate.

(6) The Court may order costs against a party if the party: (

a) fails to appear at a step in the family law proceeding; (

b) appears but is not properly prepared to deal with the issues at that step; or (

c) appears but has failed to make the disclosure required before that step.

(7) After each step in the family law proceeding, the judge who dealt with that step may, in a

summary manner: (

a) decide who, if anyone, is entitled to costs; (

b) set the amount of costs; and (

c) specify a date by which payment must be made.

(8) Offers to settle referred to in this rule do not include offers made during a pre-trial conference but do include: (

a) offers made before the commencement of a family law proceeding; and (

b) offers made pursuant to

Part 4, Division 5. [ 7 ] Additional guidance respecting the Court’s discretion in ordering costs is found in the general Rules on costs as follows:

Discretion of Court 11-1

(1) Subject to the express provisions of any enactment and notwithstanding any other rule, the Court has discretion respecting the costs of and incidental to a proceeding or a step in a proceeding, and may make any direction or order respecting costs that it considers appropriate.

(2) In exercising its discretion as to costs, the Court may determine: (

a) by whom costs are to be paid, which may include a successful party; (

b) to whom costs are to be paid; (

c) the amount of costs; (

d) the date by which costs are to be paid; and (

e) the fund or estate or portion of the fund or estate out of which costs are to be paid.

(3) In awarding costs the Court may: (

a) fix all or part of the costs with or without reference to the Tariff; (

b) award a lump sum instead of or in addition to any assessed costs; (

c) award or refuse costs with respect to a particular issue or step in a proceeding; (

d) award assessed costs up to or from a particular step in a proceeding; (

e) award all or part of the costs to be assessed as a multiple or a proportion of any column of the Tariff; (

f) award costs to one or more parties on one scale, and to another party or other parties on the same or another scale; (

g) direct whether or not any costs are to be set off; and (

h) make any other order it considers appropriate.

(4) In exercising its discretion as to costs, the Court may consider: (

a) the result of the proceeding; (

b) the amounts claimed and the amounts recovered; (

c) the importance of the issues; (

d) the complexity of the proceedings; (

e) the apportionment of liability; (

f) any written offer to settle or any written offer to contribute; (

g) the conduct of any party that tended to shorten or to unnecessarily lengthen the proceeding; (

h) a party’s denial of or refusal to admit anything that should have been admitted; (

i) whether any step in the proceeding was improper, vexatious or unnecessary; (

j) whether any step in the proceeding was taken through negligence, mistake or excessive caution; (

k) whether a party commenced separate proceedings for claims that should have been made in one proceeding or whether a party unnecessarily separated his or her defence from that of another party; and (

l) any other matter it considers relevant. Positions Advanced by Each Party [ 8 ] The father filed a draft bill of costs relying on Column 3 and seeking double costs for all steps taken after the formal offer was served. The total award reflected in the draft bill filed is $119,369. He argues that the trial, focused mainly on parenting and the best interests of the children, was necessitated by the mother’s resistance to the father’s requests for equal parenting time dating back to the date of separation. [ 9 ] The mother argues that no costs should be payable given the “mixed success”.

Moreover, she argues that the formal offer served by the father was comprehensive and should not be parsed to exclude the many complex family law issues resolved by consent judgment. Analysis

The Tariff [ 10 ] The trial was focused on parenting issues. While the issues were extremely important to this family, they were not legally significant nor complex. The judgment was not reported. The only expert was the Court’s witness. [ 11 ] I find that Column 1 is the appropriate starting point for the determination of costs payable. Interlocutory Applications [ 12 ] The father’s draft bill of costs seeks costs for the interim application. In the written fiat, the chambers justice stated “[g]iven the mixed success there will be no costs at this time”.

Counsel for the father interprets this to mean “costs in the cause”. I do not agree. [ 13 ] The following guidance from M.L.S. v N.E.D. , 2019 SKQB 26 , 19 RFL (8th) 316 [ M.L.S. ] is instructive: [13] Generally, costs relating to an interlocutory application will follow the outcome of the application unless the chambers judge directs that the issue of costs is “in the cause” or is otherwise to be determined by the trial judge.

This practice was applied by McIntyre J. in Thompson v Thompson , 2008 SKQB 116 , 328 Sask R 12 , where, after reviewing the Rules, jurisprudence and authorities respecting costs in interlocutory motions, he held as follows: [18] On the motion where costs were awarded to the respondent in a fixed amount he is entitled to those costs irrespective of the order as to costs made after trial. On the motions where there was an order for costs in the cause they will be addressed in the order for costs to be made, although it is noted they remain in the discretion of the court irrespective of the issue of success.

On those motions where it was specifically ordered that there would be no order as to costs or the order was silent as to costs, no costs of such motions can be ordered although the motions themselves are a matter which may be taken into account in the exercise of the court’s discretion as to costs following the trial.

Costs related to matters resolved by consent [ 14 ] The father’s draft bill of costs seeks costs for property statements and disclosure related to the parties’ respective family property claims notwithstanding that those claims were fully and finally resolved by consent judgment at the outset of the trial. The consent judgment incorporating the parties’ settlement makes no mention of costs. [ 15 ] As in Heffernan v Heffernan , 2023 SKKB 115 [ Heffernan ] , I am not prepared to include costs relating to claims resolved by consent.

Both parties were represented by counsel and it is reasonable to expect that if they intended to speak to costs relating to their respective property claims, the judgment would have identified same. Mixed Success [ 16 ] Rule 15-96(5) of The Queen’s Bench Rules provides for the apportionment of costs in the event of mixed success.

See also Peterson v Peterson , 2019 SKCA 76 , 30 RFL (8th) 341 [ Peterson ] ; Antosh v Antosh , 2016 SKQB 321 ; R.E.G. v T.W.J.G. , 2011 SKQB 269 , 6 RFL (7th) 400 , Frank v Linn , 2013 SKQB 28 , 412 Sask R 164 and George v Penner , 2020 SKQB 99 . [ 17 ] Here, both parties agree that there was mixed success in the outcome of the trial when compared to the positions advanced by the parties at the start of the trial and at its conclusion. The father suggests that he was mainly successful and proposes an 80:20 split.

The mother says the opposite. [ 18 ] As a starting point, much of the evidence at the trial surrounded the conflictual relationship and interactions between the parents since the separation. In the trial judgment I found that while the behaviour and stance of both parents contributed to the conflict, the mother’s behaviour certainly exacerbated the conflict and fuelled the ongoing dispute. [ 19 ] With respect to the “positions” advanced at the trial, the father sought equal parenting while the mother was more ambivalent.

She opposed an equal sharing of parenting time and asked that the children’s wishes be given significant weight. She argued that the interim order was working for the children and that they are used to it, suggesting it was reasonable for it to continue. Alternately, she proposed that the parenting

schedule recommended by the Court’s assessor be implemented. [ 20 ] Ultimately, neither party’s position was adopted by the Court. I directed that the children remain in the primary care of the mother with specified, generous parenting time with the father. When accounting for shared holidays (which were consented to) I deemed it to be a shared parenting arrangement. [ 21 ] In so finding, I rejected the father’s position, finding it too rigid and arbitrary. I also concluded that the children’s wishes should be given weight. [ 22 ] I also rejected the mother’s position.

The interim order was creating stress for the children given the numerous transitions between their parents. Further, while I found the parenting arrangement recommended by the assessor to be reasonable, I could not conclude that it was in the children’s interests at the date of trial.

Notably, my final determination was influenced by the father’s move to far more suitable accommodations partway through the trial – something the assessor suggested might justify a review or change in her recommendations. [ 23 ] On the issue of child support, the only contested issue was whether I should impute income to the mother – something I declined to do based on the evidence before me. [ 24 ] In all, the father was marginally more successful than the mother when compared to the positions each party advanced at the trial.

Enhanced Costs [ 25 ] The father served the mother with a formal offer in accordance with

Part 4 of The Queen’s Bench Rules in advance of the trial. The offer was lengthy, detailed and global in nature, proposing a resolution of property, spousal support, determination of incomes, child support, retroactive support and arrears, along with parenting. I have no trouble finding that the offer was a genuine effort by the father to resolve all matters without the expense and stress of a trial. [ 26 ] In M.L.S. , the mother sought enhanced costs relating, in part, to the service of a formal offer in advance of the trial. I reviewed the applicable case law as follows:

Part 4 Double Costs : [24] In the alternative to solicitor and client costs, the mother seeks an order for double costs pursuant to Rule 4-31 which entitles a party who serves a valid formal offer, and who subsequently obtains a judgment that is equal to or more favourable that the rejected formal offer, to double costs for all steps taken in relation to the action after the offer was served. [25] Rule 4-31 applies to family law proceedings as stated in Rule 15-25.

The party seeking to rely on Rule 4-31 bears the burden of proving, on a balance of probabilities, that the offer to settle was equal to or more favourable than the judgment rendered: H. (D.) v. H. (J.E.) , 2002 SKQB 39 , 215 Sask R 183 [ H. (D.) ], Sather v Sather , 2016 SKQB 194 [ Sather ] , James v Belosowsky , 2012 SKQB 535 , 411 Sask R 33 [ James ] , Chovin v Dancer-Chovin , 2002 SKQB 56 , 216 Sask R 19 [ Chovin ] , Knobel v Knobel , 2015 SKQB 67 , 456 Sask R 115 and Antosh v Antosh , 2016 SKQB 321 [ Antosh ] .

Further, as the Rule was established to encourage parties to resolve disputes, it is not uncommon for the court to consider, as part of its analysis, whether the offer was realistically designed to settle the case and save time, inconvenience and cost: see H. (D.) and Chovin . It is also noteworthy that Rule 4-31 does not apply if costs are awarded pursuant to the court’s discretion under Rule 11-1 or “if in special circumstances the Court orders that the rule is not to apply”: Rule 4-31(3). [26] On September 4, 2015 the mother served a formal offer to settle on counsel for the father.

The father does not deny that the offer served upon him constitutes a valid formal offer, but argues that it is not possible to say that the outcome at trial was equal to or better than what was contemplated in the offer. [27] A similar argument was advanced in Sather , a mobility matter where, after a detailed comparison of the outcome at trial and the formal offer made, the trial judge concluded that the formal offer was not equal to or better than the judgment despite finding that the child should reside in the locale proposed by the father. [28] A similar determination was made by Ryan-Froslie J. (as she then was) in James , where she held that the offer was not “as” or “more” favourable than the judgment rendered.

In so doing, she considered the details of each provision in the offer as well as the fact that the offer was all-inclusive, which did not allow for a partial acceptance which more closely compared to the mixed results provided for in the final judgment. [29] In Chovin , the court also refused to order double costs where the nature of the offers made it difficult to assess the risks of trial. As such, it could not be said that the formal offer was intended to reduce the time, cost, and inconvenience associated with trial.

Similarly, in Antosh , the trial judge declined to make an order for double costs where there were mixed results – preferring a broader approach to the assessment of costs over a mathematical assessment. [ 27 ] In M.L.S. , I ultimately refused to order double costs. [ 28 ] Here, counsel for the father argues that the parenting provisions in the order can be considered separate and apart from the property and support provisions. I agree.

While they did form part of a comprehensive settlement offer, there is no suggestion that any compromise on parenting was contingent on property or spousal support being resolved. [ 29 ] Counsel for the father also argues that the parenting provisions set out in the formal offer are “equal to or more favourable” to the father than the terms of the consent judgment and, as such, entitle him to double costs.

In support of this argument, his counsel provided an “hours” calculation of parenting time, and says that while the judgment provided the father with five less hours of parenting time every 14 days, it was nonetheless more favourable to the father because the judgment deemed the arrangement to be “shared parenting” while the offer did not. [ 30 ] Even if I were to find that the judgment was equal to or more favourable to the father than the offer on this point alone, there are many other “moving parts” that prevent an apples and apples comparison of the proposed parenting plan to the final judgment.

For instance, the judgment includes detailed provisions on holidays, communication, exchanges and how the parties conduct themselves. It is nuanced and does not lend itself to a simple side-by-side comparison of success as may be the case with a monetary determination. [ 31 ] Moreover, the father moved to a more suitable home for parenting the children partway through the trial – long after the formal offer was served and after the assessor testified and the father completed his evidence.

This was not an insignificant factor in the final outcome and could not have been weighed by the mother when the offer was presented to her. [ 32 ] In all of the circumstances, the father has not satisfied me that enhanced costs are appropriate under

Part 4 or otherwise. Other Considerations in Parenting Disputes [ 33 ] Finally, while there are no “special rules” with respect to costs in parenting disputes (see Ackerman v Ackerman , 2015 SKQB 113 at para 29 , 473 Sask R 219), the jurisprudence recognizes that departure from the presumption that a successful party is entitled to costs may be warranted given the unique considerations in play in family law matters.

[34] In M.L.S, I reviewed the jurisprudence and identify a number of the unique factors that inform the determinationof costs in parenting disputes as follows: [46] In addition to the considerations enumerated by Rule 11-1(4), there may be additional factors at play in a custody proceeding thatinform the determination of costs: Davidson v Reynolds, 2002 SKQB 103, [2002] 6 WWR 342 [Davidson], R.B.G. v P.M.S., 2008 SKQB387, 314 Sask R 4 [R.B.G.], Werbicki v Werbicki, 2009 SKQB 373, 342 Sask R 140 [Werbicki], Ackerman v Ackerman, 2015 SKQB 113at para 79, 473 Sask R 219 [Ackerman], and B.S.P. v C.M., 2018 SKQB 125 [B.S.P.]. [47] In Davidson, McIntyre J. adopted, with approval, a list of factors that are relevant to the consideration of costs in a custody matterincluding the results of any court ordered assessment, the relative financial position of the parties to the extent that it may impact theviability of the custody arrangement, improper conduct in the course of the proceedings or allegations advanced, and the concern thatparents ought not be dissuaded from putting forward their bona fide views with respect to the children’s best interests (para. 12 and 13). [48] The same factors were cited with approval in R.B.G., where the parties had a significant disparity in income.

In its analysis, thecourt referred to the decision of the British Columbia Court of Appeal in Gold v Gold (1993), (BC CA), 106 DLR(4th) 452 (BCCA) [Gold], where a list of factors were identified to assist the court in determining whether it might be appropriate todepart from the presumptive rule. Those factors included hardship, earning capacity, the purpose of the particular award, the conduct ofthe parties in the litigation and the importance of not upsetting the balance achieved by the award itself.

In R.B.G., the court found thatfinancial disparity between the parties was a relevant consideration, particularly where it impacts the viability of the custody order (para.38).

Very recently in Gordon v Nielson, 2018 SKQB 207, Wilkinson J. synthesizes the underlying rationale for this consideration asfollows (para. 256): … parents are deeply invested in their children’s well-being and should not be dissuaded from putting forward sincere views withrespect to their best interests or left with burdensome costs that might substantially affect the viability of the parenting arrangementsordered by the court. [49] The Gold case was also indirectly cited by Megaw J. in Ackerman, where he held as follows: 36 In S.D.W. v C.W.W., 2006 BCSC 162, 55 BCLR (4th) 101 Martinson J. provides helpful comments on the exercise of discretionin family law cases when dealing with the issue of costs: 28 The discretion found in the usual rule is not unlimited; otherwise, the rule, supported by strong policy considerations, wouldbecome meaningless.

In Gold at [paragraph] 20, the Court of Appeal addressed the question of when the court should “order otherwise”.It is a matter of discretion to be exercised judicially.

Strict guidelines and an exhaustive list of factors to consider would not be helpful.The Court provided a non-exhaustive list of factors: hardship, earning capacity, the purpose of the particular award, the conduct of theparties in the litigation and the importance of not upsetting the balance achieved by the award itself. 29 While financial hardship is one factor to consider, that factor is insufficient on its own to depart from the usual rule that costsfollow the event: Richter v. Richter (2004), 6 C.P.C. (6th) 181, 2004 BCSC 214 and Fulton [(2002), 2002 BCSC 1194 , 6BCLR (4th) 152].

Nor is sympathy a sound basis for departing from the usual rules: Robinson v. Lakner (1998), (BCCA), 159 D.L.R. (4th) 191, 107 B.C.A.C. 64 and Fulton. The onus is upon the person saying that the usual rule does not apply topersuade the Court why it should depart from the usual rule. [50] In Werbicki, Dufour J. followed this rationale and held as follows: 8 In general litigation, the fact that costs may impoverish the unsuccessful party is seldom of consequence – you fought, you lost,you pay. I have the discretion, however, to depart from the general presumption for, as Barclay J. termed it, “good cause”.

The financialsituation of the parties can be “good cause”: R.B.G. v. P.M.S., supra; Talarski v. Pool (1996), (SK KB), 142 Sask. R.77 (Q.B.); Gold v. Gold (1994), (BC CA), 106 D.L.R. (4th) 452 (B.C. C.A.); H.(P.) v. H.(D.) (2000), (NL SC), 5 R.F.L. (5th) 333 (Nfld. U.F.C.). In custody matters, there is the best interests of the child to consider. The goal ofcustody proceedings is to identify that which is in the best interests of the child and fashion a judgment accordingly. The courts must bemindful not to allow a large costs award to have the practical effect of upsetting the balance the court sought to achieve.

It is generallynot in the best interests of the child to impoverish a parent who has split custody. [51] Similarly, in B.S.P. [2018 SKQB 125], this Court recently held that an award of costs should not be so high as to deprive a parentof the ability to properly care for a child at issue in the litigation. [52] This, however, does not mean that the presumption that the successful party is entitled to costs does not apply in custody matters,but rather whether that presumption has been rebutted due to other causes or considerations.

In K.R.[2018 SKCA 35], the Court of Appealemphasized that the starting point in assessing costs in custody matters remains the presumption articulated at Rule 15-25(2), althoughthe presumption can be rebutted. Each case must be decided on its own facts. [35] See also Heffernan at paras 7 and 8, Peterson at para 89 and A.P. v J.P., 2020 SKCA 134 at paras 53-55, 48RFL (8th) 298. [36] In this instance, neither party filed sufficient evidence to allow the Court to consider a hardship claim.

That said,as was the situation in Nunweiler v Nunweiler, 2021 SKQB 261, both parties advanced positions that sincerely reflected what theybelieved to be in the best interests of their children. While the Court raised concerns with the mother’s actions and communications withthe children, the position she advanced at the trial was consistent with the recommendations made by the court-appointed assessor andfor that reason alone, could not be deemed unreasonable. Conclusion [37] Having considered the legal framework, jurisprudence, the outcome of the trial, the positions advanced and the

draft bills of costs filed, there shall be no order as to costs. Notwithstanding that the father was unsuccessful after seeking a costs hearing, I am not inclined to order costs as against him. ______________________________J. G.V. GOEBEL