The recent decision in Beaudoin v. Stevens, 2023 ONSC 5265 by Justice Piccoli of the Ontario Superior Court provides helpful guidance for family law lawyers on several key issues relating to costs awards. The reasons in Beaudoin v Stevens address considerations around bad faith conduct, settlement on the eve of trial, assessing “success”, reasonableness of legal fees, and Family Responsibility Office (FRO) enforcement. This case serves as a useful reminder about the principles governing costs awards and the court’s discretion in this area.
The underlying decision released on July 28, 2023 followed a four-day trial on child support variation and other financial issues. The self-represented Respondent was found to have lacked credibility, deliberately moved assets, failed to provide financial disclosure, and used intimidation tactics. The Applicant sought and was awarded retroactive and ongoing child support. She also obtained sole decision-making over the children’s passports and travel based on the Respondent’s conduct.
Costs Positions of Parties
The Applicant sought substantial indemnity costs of over $66,000 based on her success at trial and the Respondent’s unreasonable behavior amounting to bad faith. This included previous cost awards totaling $2,750.
The Respondent conceded partial indemnity costs were appropriate but challenged certain portions of the claim. He blamed his failure to disclose finances on relying upon old agreements, winter weather obstacles, and being self-represented.
Costs Under Family Law Rules
After summarizing the modern approach to family law costs focused on reasonableness and proportionality, Justice Piccoli reviews the relevant provisions under Rule 24. This includes the presumption that a successful party receives costs and the court’s ability to consider unreasonable behavior, bad faith, and failure to accept reasonable offers.
Bad Faith Standard
The endorsement helpfully reproduces passages from the thorough analysis of bad faith conduct in family law proceedings by Justice Pazaratz in Chomos v. Hamilton, 2016 ONSC 6232, 82 R.F.L. (7th) 395 (Ont. S.C.). Bad faith involves an intent to harm the other party emotionally or financially, or to conceal or deceive. It is more than just bad judgment and requires intentional duplicity.
Settled Cases and Assessing Success
Even where cases settle, costs may still be awarded if the Court can assess success and reasonableness based on the record. Citing Beardsley v. Horvath, 2022 ONSC 3430 (Ont. S.C.),, the decision notes that courts now more readily award costs for last-minute settlements to avoid discouraging resolution. The caselaw has moved away from the strict approach advanced in Blank v. Micallef (2009), 75 R.F.L. (6th) 308, 2009 CanLII 60668 (Ont. S.C.) that “compelling circumstances” are required for settled case costs.
Analysis and Findings
The Applicant was found wholly successful save for her request to set aside the old agreements. As the parenting terms matched her offers and relief sought, she was also successful on that issue despite it settling at trial.
The Respondent was obligated to provide financial disclosure even as a self-represented party. His intentional failure to do so, inflicting unnecessary expense on the Applicant, constituted bad faith conduct rather than mere unreasonableness.
After deducting time not related to the successful issues, $50,000 in substantial indemnity costs was found to be fair and reasonable. The costs were designated as fully enforceable by FRO given child support was a main issue and the time could not be accurately divided.
Key Takeaways for Family Law Counsel
Bad Faith Has High Threshold
The Court set a high bar for establishing bad faith, requiring intentional conduct to harm the other party or deceive the Court. Still, the Respondent’s egregious behavior in hiding assets and finances met that standard. Where possible, lawyers should document and demonstrate how litigation misconduct was deliberate rather than negligent.
Settlement Strategy Around Costs
The ability to claim costs should not deter late settlement, even on the eve of hearings, as the caselaw has moved away from past restrictions. Counsel can protect their client’s costs entitlements by ensuring detailed offers to settle are served under Rule 18 and documenting litigation success.
Assessing Reasonableness of Legal Fees
The global approach to scrutinizing legal bills of costs avoids line-by-line assessments as long as there are no obvious overreaching concerns. The key determination is whether the full recovery amount claimed is reasonable and proportionate. This total can then be adjusted based on considerations like divided success.
Enforcing Cost Awards
Where support issues feature prominently, Courts will readily designate costs as enforceable by FRO instead of attempting to parse time between support and non-support matters. Family lawyers should highlight the centrality of support in the litigation when seeking immediate FRO enforcement.
Costs awards serve several important functions, including indemnifying the successful party and promoting reasonable behavior. While the Court retains discretion to tailor an award to the circumstances, the decision in Beaudoin v Stevens follows established principles under Rule 24.
For counsel engaged in heated family law disputes, the guidance around bad faith, settlement conduct, fee reasonableness, and FRO enforcement helps demarcate boundaries that can influence outcomes. Understanding these costs considerations allows lawyers to better advise clients and advance their positions.
Let’s continue to elevate the practice of family law in Ontario!
Disclaimer: The information provided in this blog post is intended for general informational purposes only and should not be considered as legal advice. Consult with a qualified family law attorney for advice regarding your specific situation. Goldhart Mediation & Arbitration is not responsible for any actions taken based on the information presented in this blog.