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Posts tagged ‘Stevens v. Stevens’

Husband’s Bad Behaviour Prompts Order to Pay $1 Million in Wife’s Legal Costs

costs

Husband’s Bad Behaviour Prompts Order to Pay $1 Million in Wife’s Legal Costs

Recently, I wrote about an Ontario Court of Appeal called Stevens v. Stevens that dealt with a number of issues, among them the question of whether the trial judge’s opinion of the husband had been tainted by the fact that the husband had had an extra-marital affair. Reference  “Did Fact of Extra-Marital Affair Taint Trial Judge Against Husband?”

One of the other interesting points that were addressed in the appeal was the question of whether the husband – who lost his appeal bid – should be saddled with paying almost $1 million in legal costs incurred by the wife. (And to his credit, the husband conceded that the wife was entitled to her costs; he just took issue with their amount.)

The case had involved numerous issues to be determined, including the validity of the marriage contract, the status of the matrimonial home and a cottage, and what amount of spousal support and arrears the husband owed. The wife had been successful on every one of them.

In deciding the costs question, the court began by pointing out that under the Family Law Rules, there is a presumption that as the successful party the wife was entitled to her costs in the case. There is also a rule that states that if a party has acted in bad faith, the court must decide costs on a “full recovery basis” and order him or her to pay those costs immediately.

The court reviewed the husband’s conduct throughout the course of the litigation, and decided he had acted unreasonably. Among other things the husband:

• Caused a one-year delay in having the matter brought to trial, despite repeated requests from the wife to set a trial date. (And the court noted this delay caused significant financial repercussions to the wife, since she had to draw on the capital in order to meet her living expenses and those of her children).

• Refused to admit to 30 specific facts up-front. In reality, these facts were uncontested and the wife was needlessly forced to incur the cost and time to marshal evidence to prove those facts at trial.

• Asked the court to enforce a marriage contract signed by the wife that he knew contained an important legal and factual mistake.

• Engaged in bad faith conduct which included not making full, complete and timely disclosure of certain information; other information validly requested by the wife was never provided at all.

• Was untruthful about what his income was.

• Came to court to ask to be relieved of child support payments that he was legally required to make.

• Wrote to the trial judge directly, to ask that his child support payments be reduced because he claimed he had no income. (And not only did the husband not copy the wife on this very ill-advised letter – which was returned by the court – but he was also represented by a lawyer at the time, making his direct request to the judge doubly inappropriate).

• Improperly used funds from a company in which he had shares to pay some of his legal fees.

In the course of categorizing the husband’s condemnable behaviour, the court wrote simply:

“It is hard to prioritize the bad conduct on the part of Joel during this whole process as there are so many egregious incidents of Joel taking advantage of Pamela.”

After applying the various established factors that must be considered in awarding costs (including the importance and complexity of the issues, and the unreasonableness of each spouse’s behavior in the case), and after considering additional factors including any possible financial hardship that might be endured by the husband, the court concluded that $950,000 in legal costs incurred by the wife should be paid by the him, plus pre-judgment interest of another $55,000. (This trial court ruling was later upheld on appeal).

For the full text of the decisions, see:

Stevens v. Stevens, 2013 ONCA 267 (CanLII) http://canlii.ca/t/fx7g0

Stevens v. Stevens, 2012 ONSC 6881 (CanLII) http://canlii.ca/t/fv2c9

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at www.RussellAlexander.com.

Did Fact of Extra-Marital Affair Taint Trial Judge Against Husband?

affair

Did Fact of Extra-Marital Affair Taint Trial Judge Against Husband?

In a recent decision in Stevens v. Stevens, the Court of Appeal had to assess whether the trial judge had allowed the fact of the husband’s marital infidelity to taint his judicial objectivity in assessing costs and the validity of a putative marriage contract between the parties.

The factual background involved a couple who had been married 16 years and had three children together. The relationship went sour when the wife discovered the husband was having an affair. In the course of their trying to reconcile the wife – who had acquired substantial wealth from her father – had had her lawyer prepared a marriage contract in case those efforts were unsuccessful. When it became clear there would be no reconciliation, the written agreement came under scrutiny because there was conflicting documentation about whether the husband was to receive one-half of the value of the matrimonial home, or whether he was entitled the full value. Thus the main issue was whether the agreement was valid.

At trial, the judge had concluded that there was no enforceable agreement, based on the fact (among other things) that there had been no “meeting of the minds” as to the essential terms, and that the purported agreement was unconscionable. He also imposed a hefty costs award against the husband.

As part of his appeal, the husband raised the argument that in assessing the evidence, interpreting the documentation, and in imposing costs, the trial judge had placed undue emphasis on the fact that he had cheated on the wife.

The Ontario Court of Appeal disagreed that this had any impact. It observed that the whole case revolved around the fact that the marriage was falling apart, and that there were necessary discussions about attempts to reconcile. These, by necessity, included reference by the court to the husband’s conduct as that related to reconciliation attempts. Indeed, the trial judge had clearly stated in the reasons that he found that the husband’s conduct could not be connected to the issue of whether the marriage contract should be set aside.

Turning next to the husband’s claim that the trial judge had made an unreasonable award of costs against him, the Court of Appeal found that – to the contrary – the husband had unilaterally driven up costs because of his behaviour during the litigation, and had refused a very reasonable offer of settlement. While conceding that the trial judge’s costs award “pushes reasonableness and proportionality to their limits” there had been no misuse of the cheating evidence and no reversible error.

For the full text of the decision, see:

Stevens v. Stevens, 2013 ONCA 267 (CanLII) http://canlii.ca/t/fx7g0

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at www.RussellAlexander.com.