A Couple of Cases on Costs
In todays’ Blog we briefly touch on two cases that concern costs awards in family law litigation. As you may already know, costs orders are made by a court in accordance with its overall discretion; however, they are often – though not always – awarded to the successful party at trial or on a motion. Essentially, they are a means for having the unsuccessful party pay for at least some of the litigation costs incurred by the party who emerged victorious in court.
With that said, here are a couple of interesting cost-related questions:
1) Who gets costs if both parties disobey the court?
In Vickers v. Vickers, the court as part of a divorce action ordered the spouses to agree upon and retain: a) a “certified real estate valuator” to appraise their matrimonial home, and b) a real estate agent to sell it. The court also ordered the house to be listed for sale by a certain date.
However, the spouses deliberately did not comply with the court’s order: instead they mutually agreed to dispense with the services (and cost) of a “certified real estate valuator,” since they felt that they could obtain a valuation from the experienced real estate agent(s) they were planning to hire.
Unfortunately, this plan to use real estate agents did not play out as intended; after obtaining several different assessments the parties were unable to agree on a single valuation figure. Indeed, a full year after the court’s order, the house had still not been listed. The matter came back before the court; after devising a formal plan to eliminate the valuation stalemate, the court addressed the costs question as follows:
Neither party complied diligently with the Order, with the result that the disposition of the home and its contents and, therefore, the resolution of the property issues in the proceeding, has been delayed. …
This motion was made necessary, in large part, by both parties’ non-compliance with the Order dated January 7, 2011. In these circumstances, it is appropriate that each party bear his or her own costs of the motion.
2) Must a party make an offer that he or she knows will be rejected?
Next, a case called Mudronja v. Mudronja deals with an interesting question: Is a party to family litigation obliged to make a formal offer to the other party, even if he or she knows that the offer will be turned down?
The answer, apparently, is “yes”. Moreover, in these kinds of circumstances the fact that a party made a sure-to-be-rejected offer is still a prime factor in awarding costs. The court in this case wrote:
There were no Offers to Settle made in connection with these motions. Eddy says he did not make an Offer because the relief sought by the Respondent was so clearly unreasonable that no Offer to Settle other than a consent to dismissal would have made any sense, and, in addition, would have been an Offer that would never have been accepted.
With all due respect, the fact that an Offer might not be accepted is no reason not to make an Offer. A reasonable Offer to Settle is a major consideration when deciding whether costs are awarded and if so, the scale of a costs award.
For the full text of the decisions, see:
Vickers v. Vickers, 2012 ONSC 973 (amending 2012 ONSC 847) http://canlii.ca/t/fpvhn
Mudronja v. Mudronja, 2012 ONSC 3592 http://canlii.ca/t/frr0z
Additional reasons to:
Mudronja v. Mudronja, 2012 ONSC 2655 http://canlii.ca/t/fr5qn
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