B.R.T. v. J.L.T.T.

2011 BCSC 440 B.R.T. v. J.L.T.T. IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: B.R.T. v. J.L.T.T., 2011 BCSC 440 Date: 20110408 Docket: E100539 Registry: Vancouver Between: B.R.T. Claimant And J.L.T.T. Respondent Before: The Honourable Mr. Justice Goepel Supplementary Reasons to Supreme Court of British Columbia, March 1, 2011 (B.R.T. v. J.L.T.T., 2011 BCSC 250, VA E100539) Supplementary Reasons for Judgment Counsel for the Claimant: K. Duhra Counsel for the Respondent: L. Olver Place and Date of Trial: Vancouver, B.C. December 13-17, 2010 Written Submissions of the Claimant: March 7 & 25, 2011 Written Submissions of the Respondent: March 23, 2011 Place and Date of Judgment: Vancouver, B.C. April 8, 2011 [1] Reasons for Judgment in this family case were released on March 1, 2011. They can be found at 2011 BCSC 250. With regard to the issue of costs, I said as follows: [50] There has been mixed success in this trial. The husband has succeeded in shared parenting while the wife has obtained an order for ongoing spousal support. The husband obtained an order to have the Barclay Street Residence sold and the proceeds divided equally. Taking all matters into consideration, my view is that each party should pay their own costs save and except the parties will share equally the hearing fees and the costs of Dr. Krywaniuk's report. If either party seeks a different costs determination, they should file written submissions within 21 days of release of these reasons. Any responsive submissions should be filed within 14 days thereafter. [2] The parties have subsequently filed written submissions with regard to costs. The husband submits that he was the substantially successful party in the litigation and seeks an award of costs in his favour. [3] In support of his submission, the husband notes that in his opening submissions he sought the following orders: (1) that the parties equally share the residence of the child; (2) that the matrimonial home be listed for sale immediately and the proceeds divided equally between the parties; (3) that income be imputed to the mother in the sum of $75,000 per annum; (4) that child support be determined in accordance with the set-off formula; (5) that if the evidence at trial shows that income ought to be imputed to the mother or that she is not entitled to spousal support, that the amounts in the interim order made August 4, 2010 be adjusted accordingly; (6) that the mother be ordered to pay half the costs of Dr. Krywaniuk's report; (7) divorce; and (8) costs. [4] With regard to those issues, the wife's position at trial was that: (1) primary residency of the child should be with her; (2) the matrimonial home should be apportioned 70% to 100% in her favour; (3) spousal support should be based on the respondent's income of $14,700 and should be ordered in the amount of $762 per month for a duration of between 8.5 and 17 years; (4) child support should be based only upon the claimant's income and that the claimant should pay 89% of extraordinary expenses; and (5) she should be awarded costs. [5] I ordered a shared parenting regime. I ordered that the matrimonial home be sold and the proceeds divided equally. I imputed income to the wife of $36,000 per year. I ordered child support based on a set-off formula and spousal support of $250 per month for five years. [6] The law concerning costs in a family law dispute was recently summarized by Pearlman J. in MacLean v. Mio, 2011 BCSC 148 at paras. 17-31: [17] Rule 16-1(7) of the Supreme Court Family Rules provides: (7) Subject to subrule (9), costs of a family law case must be awarded to the successful party unless the court otherwise orders. [18] In family law proceedings, Rule 16-1(7) replaced Rule 57(9) of the former Supreme Court Rules, which provided: (9) Subject to subrule (12), costs of and incidental to a proceeding shall follow the event unless the court otherwise orders. [19] Under the former Rule 57(9), costs normally followed the event, and went to the party who enjoyed "substantial success": Gold v. Gold, 82 B.C.L.R. (2d) 180, 32 B.C.A.C. 287. [20] The respondent suggests that the omission from Rule 16-1(7) of reference to costs following the event means that the determination of which party is "successful" in family law cases may no longer require an analysis of which party was "substantially successful" in the event. The respondent has not proposed an alternative test that would apply to a family law case involving multiple issues or matters in dispute. [21] Rule 14-1(9) of the Supreme Court Civil Rules provides that: (9) Subject to subrule (12), costs of the proceeding must be awarded to the successful party unless the court otherwise orders. [22] Rule 16-1(7) of the Supreme Court Family Rules and Rule 14-1(9) of the Supreme Court Civil Rules both state the same principle: the successful party must be awarded costs unless the court otherwise orders. [23] In both family law cases and civil proceedings, the court's discretion to order otherwise must be exercised judicially: Gold v. Gold, at para. 19. [24] In Aschenbrenner v. Yahemech, 2010 BCSC 1541, Mr. Justice Metzger in awarding costs under Rule 14-1(9) applied the law as developed under the former Rule 57(9). Referring to Rule 14-1(9), Metzger J. at para. 13 said this: While the Rule itself does not include the term "substantial success" under the former Rule 57(9), it was held to be a necessary and sufficient condition for an award of costs under Rule 57(9) that success in the outcome of the trial be "substantial": see Gold v. Gold, 82 B.C.L.R. (2d) 180, 32 B.C.A.C. 287. [25] In Aschenbrenner, Metzger J. in determining whether to award costs to the successful party, applied the four part test stated by Bouck J. in Fotheringham v. Fotheringham, 2001 BCSC 1321 at para. 46: 1. First, by focusing on the "matters in dispute" at trial. These may or may not include "issues" explicitly mentioned in the pleadings. 2. Second, by assessing the weight or importance of those "matters" to the parties. 3. Third, by doing a global determination with respect to all the matters in dispute and determining which party "substantially succeeded," overall and therefore won the event. 4. Fourth, where one party "substantially succeeded," a consideration of whether there are reasons to "otherwise order" that the winning party be deprived of his or her costs and each side then bear their own costs. [26] Other recent decisions of this court which have applied the substantial success test include Chen v. Beltran, 2011 BCSC 41, at paras. 9 and 10, an award of costs under Rule 14-1(9) of the Supreme Court Civil Rules, and B.K.A. v. D.M.A., 2011 BCSC 17, at paras. 33-35, an award of costs under Rule 16-1(7) of the Supreme Court Family Rules. [27] Cases decided under the former Rule 57(9) established that the principles governing the award of costs in family law proceedings are the same as those applicable to other civil litigation: Gold v. Gold (1993), 82 B.C.L.R. (2d) 180 (C.A.) at para. 19; Karpodinis v. Kantas, 2006 BCCA 400 at para. 4. [28] The Court of Appeal has recently held that Gold applies to custody cases, and that there is no general principle that costs should not be awarded in a case where custody is in issue: C. (S.J.) v. A. (S.C.), 2010 BCCA 31 at para. 62, and Reis v. Bucholtz, 2010 BCCA 115 at para. 86. [29] Rule 14 -1(9) of the Supreme Court Civil Rules and Rule 16-1 (7) of the Supreme Court Family Rules state an identical test for the award of costs. I conclude that the principles applicable to the award of costs in a family law case remain the same as those applicable in other civil proceedings. [30] Following the reasons for judgment of Metzger J. in Aschenbrenner, I also conclude that in determining which party is "successful" under Rule 16-1(7), the court must still consider, in a case involving multiple issues, whether one party has been "substantially successful". That requires an objective comparison of the relief granted and results obtained by the parties with the submissions made at trial: Fotheringham, at paras. 28, 60; Rattenbury v. Rattenbury, 2001 BCSC 593 at paras. 20, 21. [31] In Fotheringham, at para. 45, Bouck J. described substantial success as 75 percent or better, to be determined by the trial judge looking at the disputed matters globally, and weighing their relative importance to the parties. [7] Turning to the case at bar, the husband had complete success on the issues of joint parenting and division of assets. There was mixed success on the question of spousal support. The resolution of that issue turned on the amount of income imputed to the wife. I imputed $36,000 of income to her, which sum was less than that sought by the husband but more than the amount the wife suggested. [8] Applying the law as set out in MacLean and looking at the disputed matters globally, and weighing their relative importance to the parties, I find that the husband was substantially successful in this litigation. [9] The wife submits that even if the husband was substantially successful, I should take into account her financial circumstances. She submits that given the disparity in the parties' incomes, it would be inappropriate to award costs against her. In support of that submission, she cites Richards v. Richards (1993), 20 C.P.C. (3d) 332 (B.C.S.C.), Lilley v. Lilley (1994), 50 R.F.L. (3d) 341 (B.C.S.C.) and McHugh v. McHugh, [1996] B.C.J. No. 141 (S.C.). She notes that as a result of the judgment she will be receiving reduced amounts in child and spousal support. In addition, regardless of the court's imputation of income to her, she presently is without income and to further burden her with an award of costs will be a financial hardship. [10] I accept that an award of costs would cause the wife some financial hardship. However financial hardship is not sufficient reason on its own to depart from the usual rule that costs should follow the event: S.D.W. v. C.W.W., 2006 BCSC 162. In this case, however, in addition to financial hardship the wife did succeed in obtaining orders for ongoing child and spousal support. If I had accepted the husband's submission that I should impute to her an income of $60,000, she would not be entitled to either child support or spousal support. [11] Even in cases where one party has achieved substantial success, the court may nonetheless award only a portion of the successful party's costs: Cohen v. Cohen (1995), 15 R.F.L. (4th) 84 (B.C.C.A.), Newston v. Newston [1994] B.C.J. No. 139 (C.A.) and Rolls v. Rolls (1996), 20 R.F.L. (4th) 232 (B.C.C.A.). [12] Taking into account the financial hardship to the wife, the present earning capacity of both parties and the awards for child and spousal support, I would limit the husband to one-half of his costs and disbursements. Those amounts will be paid out of the wife's share of the proceeds from the sale of the matrimonial home. I confirm my earlier order that the parties will share equally the hearing fees and the costs of Dr. Krywaniuk's report. MISCELLANEOUS MATTERS [13] Since the release of the reasons for judgment, two matters have been brought to my attention. In my reasons, I overlooked the husband's outstanding tax debt of $959.73. That tax debt, like the wife's tax debt, arose before the parties separated and should be paid from the gross proceeds of the sale of the family residence. [14] In my reasons, I calculated arrears of spousal support to be $6,500.00. I had understood that no spousal support had been paid. It has now been brought to my attention that subsequent to the order of August 4, 2010, the husband paid $2,394 in spousal support. This reduces the arrears of spousal support to $4,106. That sum should be paid from the husband's share of the sale proceeds. "R.B.T. Goepel J." ________________________________________ The Honourable Mr. Justice Richard B.T. Goepel