The Importance of Offers to Settle
It is often asked by clients why they need to prepare an Offer to Settle, and this article will examine that question by looking at the importance of Offers to Settle in the Family Law file. As stated by Justice Blishen, “Under the Family Law Rules, O. Reg. 114-99, offers to settle are quasi obligatory. Service of at least one offer to settle should be a basic step in every family law proceeding.”[i]
The Family Law Rules define an Offer as simply that, “…an offer to settle one or more claims in a case, motion, appeal or enforcement, and includes a counter-offer.”[ii] But how do you prepare one, and what is the benefit to preparing one, especially when you know the other party will not accept it?
An Offer to Settle needs to narrow the issues and should be what you can expect to achieve at a minimum. The goal is to match or beat your Offer to Settle as if you do you will be rewarded (typically with costs).
Format of the Offer[iii]
An Offer to Settle is a settlement proposal as to the claims the person making the offer has advanced. This can be done even prior to commencing litigation, and provided that you have not withdrawn (formally told the other party that the offer is no longer available for acceptance or in the case of a time-limited offer the expiration period has been met), any and all offers made remain open for acceptance and even better are available for cost arguments. You should note that an Offer expires once the Court begins making a decision on the issue(s) contained in the Offer.
The Offer to Settle must be signed by you personally and if you are represented by counsel, your solicitor also. Failure to abide by this term renders your Offer to Settle defunct (not able for acceptance).
Your Offer to Settle needs to be about the issues before the Court, in other words, if you include issues in the Offer to Settle that are not being decided, the Offer will not meet the requirements under the Rules and may result in the loss of costs being awarded to you. This issue can present at a Motion where the Notice of Motion does not reference the information in your Offer to Settle, or even at Trial, be mindful to always cross-reference your pleadings to make sure that you are not seeking relief that you have no standing to claim.
It is crucial that you consult with your solicitor as to the impact of time-limited Offers to Settle, as for costs to be awarded, your Offer needs to be open for acceptance at the time of the disposition of the Justice hearing your matter – time-limited offers that have past their expiration points are the same as Offers to Settle that have been withdrawn.
When To Make an Offer
Typically, Offers to Settle are made:
- At the time of preparing Motion Materials;
- At the time of preparing for the Settlement Conference;
- After receipt of a parenting report/assessment;
- After the sale of property or after the exchange of financial information;
- During Trial preparations; and
- Such other times as advised by your solicitor.
Service of the Offer to Settle is important to note, there needs to be sufficient time for the other party to review and accept the Offer to Settle prior to the hearing (or next step) in your matter. The Family Law Rules require that an Offer to Settle be made:
- if for a motion, a minimum of one day in advance of the motion; and
- if in advance of a trial or other step (conference), seven days in advance.
Many counsels have placed cost implications within the body of the Offer to Settle, the Family Law Rules however safeguard cost arguments by allowing either party to request costs if they were not claimed in the Offer to Settle.[iv] You should speak with your solicitor more about the impacts of placing costs within the body of the Offer to Settle or leaving this up to the determination of the Justice at the hearing of the matter.
It is well-settled law in Ontario that Offers to Settle are a yardstick by which to measure success and significant in considering both liability for costs and the amount of costs. See Osmar v. Osmar, 2000 CanLII 20380 (ON SC), 2000 CarswellOnt 2343 (S.D.J.).[v]
Failure to make an Offer to Settle can have serious repercussions, Justices have held that failure to make an Offer as “unreasonable”. [vi]
The Family Law Rules require that the parties and their counsel have a duty to act in a manner that takes into consideration any and all cost/time-saving measures, narrow the issues focus on settlement and narrow the issues. The failure to serve an offer to settle will be an adverse factor when assessing costs. See Laing v. Mahmoud, 2011 ONSC 6737 (CanLII).
Although you may feel the costs of preparing an Offer to Settle will not benefit you, after review of this article and the positions taken by Family Law Justices, you will see how important a role Offers to Settle play in the Family Law file.
[i] Justice Blishen, para 6, Laing v. Mahmoud, 2011 ONSC 6737 (CanLII)
[ii] FLR, 18 (1)
[iii] FLR, 18 (4)
[iv] FLR, 18 (11)
[v] Madam Justice D. Summers, para 3, Stow v. Davidson, 2018 ONSC 3274 (CanLII)
[vi] Madam Justice D. Summers, para 13, Crump v. Crump, 2018 ONSC 3191 (CanLII)
Special thanks to Senior Law Clerk Amanda Crocker who authored this blog. At Russell Alexander Collaborative 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 RussellAlexander.com