D.Z. v. R.H.Z.

2020 BCSC 1265 D. Z. v. R. H. Z.

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: D. Z. v. R. H. Z., 2020 BCSC 1265 Date: 20200828 Docket: E55576 Registry: New Westminster Between: D. Z. Claimant And: R. H. Z. Respondent Before: The Honourable Madam Justice Adair Reasons for Judgment on Costs Counsel for the Claimant: D. Glass B. Hepburn Counsel for the Respondent: R. Chambers Written submissions received from the Claimant: August 14, 2020 No other submissions received Place and Date of Judgment: New Westminster, B.C. August 28, 2020 [1] On June 16, 2020, I issued Reasons for Judgment in this family law proceeding. My Reasons are indexed at 2020 BCSC 891. [2] I considered that success had been divided, and, subject to submissions, I ordered that each party would bear her and his own costs. However, I ordered that, if the parties wished to make submissions concerning costs, they could do so in writing, provided that all submissions were filed within 60 days of the date of my Reasons. I left counsel to agree on a suitable schedule for the exchange of submissions. [3] On August 14, 2020, I received written submissions on behalf of the claimant, Ms. Z. I did not receive any submissions on behalf of the respondent, Mr. Z. [4] On behalf of the claimant, Ms. Glass submits that the claimant should be awarded costs, as the party who was substantially successful, assessed either as special costs or under Appendix B of

the Supreme Court Family Rules on the basis that the case was one of ordinary difficulty. Ms. Glass submits further that the claimant should be awarded double costs, based on offers to settle delivered from time to time during the litigation. Finally, Ms. Glass submits that the claimant could recover costs awarded to her in respect of interim applications. [5] In support of the claimant's position that she was substantially successful in the litigation, Ms. Glass cites: Brouwer v. Brouwer, 2019 BCSC 1435, at para. 14; and MacLean v. Mio, 2011 BCSC 148, at paras. 30 and 31. In Brouwer, Punnett J. wrote, at para. 14: [14] The leading case on family law costs is Gold v. Gold (1993), 82 B.C.L.R. (2d) 180. It established that if a party is "substantially successful" they are entitled to their costs. In MacLean v. Mio, 2011 BCSC 148 at para. 30, Pearlman J. addressed the issue of "substantially successful". He noted such an inquiry "requires an objective comparison of the relief granted and results obtained by the parties with the submissions made at trial". However, as noted in Gold (at 185), there are factors a court can consider in departing from the usual rule: Factors such as hardship, earning capacity, the purpose of the particular award, the conduct of the parties in the litigation, and the importance of not upsetting the balance achieved by the award itself are all matters

which a trial judge, quite properly, may be asked to take into account. [6] Ms. Glass submits that the areas of dispute here were summarized at para. 6 of the Reasons: [6] . . . [T]he parties have been able to narrow the areas of dispute essentially to these: who should have final decision-making authority respecting the parties' two youngest children; what were the parenting arrangements for purposes of retroactive child support; what are the parties' respective Guidelines incomes for purposes of the Federal Child Support Guidelines; whether certain expenses are recoverable as s. 7 expenses under the Guidelines; whether Ms. Z is entitled to spousal support; and certain issues concerning family property and debts. [7] Ms. Glass submits that the claimant had outright success on three of the six issues, and that the parties had mixed success on the remaining issues. Ms. Glass submits that, globally, the claimant reaches the 75% threshold for a finding of "substantial success." [8] Specifically, Ms. Glass argues that the claimant was successful on: the determination of the parties' Guidelines incomes; whether certain expenses were recoverable as s. 7 expenses under the Guidelines, and concerning on-going s. 7 expenses (where the respondent's position was rejected); and the issue of the claimant's entitlement to spousal support, where the court found that the claimant was entitled

to support on both compensatory and non-compensatory grounds, and entitled to retroactive spousal support. [9] With respect to the remaining three issues, there was mixed success, in Ms. Glass's submission. [10] When I consider the disputed matters globally, and weigh their relative importance to the parties and in the light of Ms. Glass's submissions, I conclude that the claimant has been substantially successful. As Ms. Glass pointed out, the claimant's position on Guidelines incomes for purposes of support (both retroactive and ongoing) was accepted over the position advanced by the respondent. Moreover, I rejected the respondent's position concerning the amounts of retroactive child support (both basic support and s. 7 expenses) owing by each parent, and, in the result, fixed net retroactive support owed and payable by the respondent at over $10,000. I rejected the respondent's position concerning s. 7 expenses. Finally, I found that the claimant had established an entitlement to spousal support, and ordered that the respondent pay retroactive support. [11] I find, therefore, that the claimant has been substantially successful and is entitled to her costs. [12] Ms. Glass submits that the claimant's costs should be assessed as special costs. She argues that the respondent unnecessarily lengthened the trial, made scandalous accusations about the claimant, failed in his

obligation to make the financial disclosure legally required of him and breached court orders. Ms. Glass submits that the respondent's conduct amounts to reprehensible conduct, sufficient to justify an award of special costs. [13] I do not agree. As can be seen from the Reasons, I was critical of the way that the respondent (and his counsel) conducted the trial, and of the respondent's failure to obey court orders, for example. However, the court must exercise restraint in awarding specials costs, and the party seeking special costs must demonstrate exceptional circumstances to justify a special costs order: see Westsea Construction Ltd. v. 0759553 B.C. Ltd., 2013 BCSC 1352, at para.

73. I have not been persuaded that, here, the respondent has acted in a manner that is sufficiently reprehensible to warrant chastisement of the court through an award of special costs. [14] Accordingly, subject to consideration of the claimant's offers to settle, I order that the claimant is awarded her costs, payable by the respondent, in accordance with Appendix B of the Supreme Court Family Rules and on the basis that the case involved ordinary difficulty. [15] I turn then to the claimant's offers to settle, based on which she is seeking double costs. [16] Rules 11-1(4) to (6) of the Supreme Court Family Rules deal with offers to settle. [17] The court may consider an offer to settle when exercising the court's discretion in relation to costs: Rule 11-1(4). The options for the court are set out in Rule 11-1(5), and include (in subrule (b)) awarding double costs of all or some of the steps taken in the family law case after the date of delivery or service of the offer to settle. The considerations for the court are set out in Rule 11-1(6): (a) whether the offer to settle was one that ought reasonably to have been accepted, either on the date that the offer to settle was delivered or served or on any later date, (b) the relationship between the terms of settlement offered and the final judgment of the court; (c) the relative financial circumstances of the parties; (d) any

other factor the court considers appropriate. [18] An award of double costs is a punitive measure against a litigant for that party's failure, in all of the circumstances, to have accepted an offer to settle that should have been accepted. Litigants are to be reminded that costs rules are in place to encourage the early settlement of disputes by rewarding the party who makes a reasonable settlement offer and penalizing the party who declines to accept such an offer. Whether the offer to settle was one that ought reasonably to have been accepted is not determined by reference to the award that was ultimately made. Rather, the reasonableness is to be assessed by considering factors such as the timing of the offer, whether it had some relationship to the claim (as opposed to simply being a "nuisance offer"), whether it could be easily evaluated, and whether some rationale for the offer was provided. See Hartshorne v. Hartshorne, 2011 BCCA 29, at paras. 25 and 27. [19] The claimant's first offer (Appendix "A" to the claimant's written submissions) is dated September 27, 2018, the day before the claimant filed her first without-notice notice of application (see Reasons, at para. 42). Among other things, the offer was made before either party had sworn F8 financial statements, and contained no terms concerning child support issues. Spousal support was proposed to be dealt with on an

interim and without prejudice basis. Clearly, the first offer was not one that would have finally settled the family law case. In my view, this was not an offer that ought reasonably to have been accepted. It cannot provide a basis to award double costs. [20] The claimant's second offer (Appendix "B" to her written submissions) was sent under cover of a letter dated October 9, 2019, 12 days before the start of the trial. The terms are set out in a comprehensive draft order, dealing with all matters that were in issue at trial. In the draft order, the claimant did not propose terms concerning final decision-making for any of the children. Rather, the draft order was silent in that respect. It proposed that both parents be guardians and exercise the parental responsibilities under s. 41 of the Family Law Act. The parenting time proposed for the two youngest children was essentially what I ordered. The claimant proposed a 2019 Guidelines income for the respondent that was less than my conclusion, and the amount of retroactive child support was less than what I ordered. The claimant proposed payment by her of a proportionate share of s. 7 expenses that I rejected as not proper s. 7 expenses. The claimant proposed lump sum spousal support, in satisfaction of any retroactive or on-going spousal support. [21] The claimant's third offer (Appendix "C" to her written submissions) was

sent under cover of a letter dated October 30, 2019 (Day 9 of the trial), and is a revised form of the draft order sent on October 9, 2019. [22] In my view, the claimant's second offer was one that ought reasonably to have been accepted by the respondent. It remained open for acceptance as of the start of the trial. It was delivered at a point when the issues for trial had been fully developed, and the offer had a clear relationship to those issues. While there was no commentary or "rationale" for the offer set out in the covering letter, in my view, in the circumstances, none was required. The offer proposed reasonable compromises. Its terms had a reasonable relationship to the final judgment of the court. Acceptance of the offer would have avoided a 12-day trial. [23] While, in my view, the first two factors in Rule 11-1(6) are the most important here, the matters that Ms. Glass raised in support of the claimant's claim for special costs are "other factors" that it is appropriate for me to consider in relation to this offer to settle. These factors also weigh in favour of the claimant. [24] Accordingly, I conclude that this is an appropriate case to award the claimant double costs, based on her second offer to settle, after October 9, 2019. [25] Finally, with respect to the costs in relation to the interim applications, since I have concluded that the claimant has been

substantially successful in the case and is entitled to costs on that basis, the normal disposition will apply with respect to costs on interim applications. [26] In summary, I order that the claimant is entitled to her costs under Appendix B of the Supreme Court Family Rules, on the basis that the case involved ordinary difficulty, and double costs after October 9, 2019, together with taxes and necessary and reasonable disbursements. "Adair J."