N.C. v. J.P.C.

2017 BCSC 1592 N.C. v. J.P.C. IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: N.C. v. J.P.C., 2017 BCSC 1592 Date: 20170907 Docket: E162078 Registry: Vancouver Between: N.C. also known as N.L. Claimant And J.P.C. Respondent Before: Master Taylor Reasons for Judgment Re: Costs Counsel for Claimant: L. Hamilton Counsel for Respondent: Self-represented Place and Date of Trial/Hearing: Vancouver, B.C. July 14, 2017 Place and Date of Judgment: Vancouver, B.C. September 7, 2017 [1] I rendered oral reasons in this matter on August 4, 2017, and reserved on the issue of costs. In that regard, I said this at paras. 48-50 of my reasons for judgment: [48] Paragraph 6 of the order of March 31, 2017 says that the claimant's application for costs in her Notice of Application filed December 2, 2016 is adjourned together with the remainder of the relief sought in the Notice of Application filed February 16, 2017. The February 16, 2017 Notice of Application sought orders for interim spousal support, an order that the parties attend the ReconnectFamilies program, and that both parties are the guardians of the children of the marriage. [49] The last order went by consent. At paragraph 7 of the Notice of Application dated February 16, 2017, the claimant sought costs payable forthwith, or in any event of the cause. In the claimant's Notice of Application dated June 29, 2017 where the claimant sought summer parenting time with K., the claimant sought specified costs payable by the respondent to the claimant forthwith. Costs were not specifically addressed by either party during submissions. Nor do I have the Notice of Application filed December 2, 2016 before me. [50] Thus, in fairness to the parties, I will entertain written submissions on the issue of costs to date. The claimant should have her written submissions regarding costs submitted to the court and a copy to the respondent by the close of business on Monday, August 14, 2017, and the respondent should have his reply to the court filed by the close of business on Tuesday, August 22, 2017. [2] I received the claimant's written submissions on August 14, 2017. I have yet to receive the respondent's written submissions, which I find puzzling, and all the more so because the respondent is a litigation lawyer and a partner in a large law firm in downtown Vancouver, and has represented himself throughout these proceedings. I will, therefore, proceed on the basis that the respondent has chosen not to make any submissions on the issue of costs in these proceedings. [3] Rule 16-1 of the Supreme Court Family Rules sets out the general rule of costs in family proceedings. Rule 16-1(7) provides that subject to subrule (9), costs of a family law case must be awarded to the successful party unless the court orders otherwise. [4] Subrule (9) of R. 16-1 provides that, unless the court hearing the application otherwise orders: (a) if the application is granted, the party who brought the application is entitled to costs of the application if that party is awarded costs at trial or at the hearing of the petition, but the party opposing the application, if any, is not entitled to costs even though that party is awarded costs at trial or at the hearing of the petition, and (b) if the application is refused, the party who brought the application is not entitled to costs of the application even though that party is awarded costs at trial or at the hearing of the petition, but the party opposing the application, if any, is entitled to costs if that party is awarded costs at trial or at the hearing of the petition. [5] In her application filed December 2, 2016, the claimant sought orders with respect to parenting arrangements, Christmas parenting time, spring break parenting time, and a section 211 report. An application was brought for Christmas parenting time as the Respondent did not agree to the Claimant having extended time with K over the Christmas holidays. Once the application had been made, and therefore the costs incurred, the claimant says the respondent then agreed to shared parenting of K over Christmas. This resulted in the Order of Master Scarth pronounced December 14, 2016. [6] In her February 16, 2017 application, the claimant sought an order for interim spousal support; an order that the respondent purchase the claimant's interest in the former matrimonial home failing which the claimant would have sole conduct of sale; an order that the family participate in Bob Finlay's ReconnectFamilies program; an order that the respondent commence counselling, and an order relating to guardianship. [7] The issue of the matrimonial home was addressed at the hearing on March 31, 2017. Orders were made with respect to the respondent purchasing the claimant's interest in the former family home. An Order was also made that the claimant would have sole conduct of sale if her interest was not purchased by April 13, 2017. [8] The issue of the respondent purchasing the claimant's interest in the former family home had already been dealt with at a mediation held on September 21, 2016. Appraisals were conducted in accordance with the terms of the agreement. The mediation agreement also provided that the purchase of the claimant's interest in the home was to complete on or before January 31, 2017. The claimant maintains that the respondent failed to comply with the terms of the agreement which, therefore, resulted in the in the claimant's application seeking an order that the respondent purchase the claimant's interest in the former matrimonial home. [9] In relation to the issue of spousal support, an interim order for spousal support of $4000 per month was made at the hearing on February 28, 2017. This interim order was made pending the next hearing scheduled for March 31, 2017, and with virtually no financial information available to the Court. At the March 31 hearing, a further interim order of $4000 per month was made pending a full hearing on the issues of spousal support. That hearing was held on July 14, 2017. [10] The claimant maintains that the respondent did not produce all of his income particulars until ordered to do so by the Court, and when provided, the evidence showed an annual income for the respondent of $377,000.00 rather than the $160,000.00 the respondent claimed as payments received from his law corporation only. In fact, the claimant submits that the respondent did not provide his full income information until it was requested by the Court. It was only when he was asked whether there was more income than set out in his T4 that the respondent produced his T5 which showed additional income. This was done during his submissions on the request from the Court. The claimant suggests the respondent failed to provide this income information to the claimant despite requests for financial information. [11] At the hearing into the issue of spousal support, the claimant proposed monthly spousal support of $9000.00, while the respondent's position was that only $2600.00 was payable as monthly spousal support. Ultimately, I decided that interim spousal support in the amount of $6500.00 per month was the appropriate amount pending trial. [12] Other orders for the attendance in Mr. Findlay's ReconnectFamilies Program were made which the claimant sought, especially due to the estrangement between the claimant and her two sons. [13] The claimant submits that she was substantially successful in regards to the relief she was seeking in her notice of application dated February 16, 2017. [14] The claimant brought an application dated June 29, 2017, where she sought a change in the regular parenting schedule to allow for a shared parenting regime for the daughter, K during the summer of 2017. The claimant maintains that she attempted to resolve this issue with the respondent well before the summer, but without success, and therefore found it necessary to bring her application for shared summer parenting time with K. This was because the claimant sought extended holiday parenting time with K rather than the usual parenting schedule in effect. [15] The respondent's position as set out in his application response filed July 13, 2017, was that K ought to reside with him and that the claimant should have alternate weekends. In the alternative, he proposed a schedule which provided him with parenting time of K over 37 days and the Claimant with 14 days. [16] On July 14, 2017, I suggested that each party have roughly equal time with K, however, my reasons for judgment were not rendered until August 4, 2017, which essentially took away some of the summer parenting time from the claimant. In my oral reasons of August 4, 2017, I made an order, the net effect of which was that from the date of the order, the respondent would have 12 days with K and the Claimant have 18 days with K. In my reasons, I said this: [37] Given that time has intervened since the hearing of this matter, I propose that the same schedule as suggested by the claimant be modified slightly in order to fit into the remainder of the month of August, such that the respondent's parenting time with K commence as of today, August 4th, and continue to 6:00 pm on August 10th. Thereafter, the claimant shall be entitled to summer parenting time with K from 6:00 pm on August 10th, to 6:00 pm on August 20th. [38] K will then spend time with the respondent from 6:00 pm on August 20th until 6:00 pm on August 28th, and then the claimant shall have the remaining time with K until 6:00 pm on Monday, September 4, when she returns to the respondent's residence in order to commence school the following day. The regular schedule of parenting time takes effect on Tuesday, September 5. [17] In regard to the costs of these hearings, the claimant has submitted bills of costs which total $11,200.00. In the alternative, the claimant suggests I examine the conduct of the respondent as a relevant consideration in determining costs. [18] The claimant also submits that conduct can be addressed by way of special costs, where special costs are awarded to sanction reprehensible conduct, which encompasses both scandalous or outrageous conduct and milder forms of misconduct deserving of the court's rebuke (Dyer v. Dyer, 2016 BCSC 1115, citing Garcia v. Crestbrook Forest Industries Ltd. (1994), 9 B.C.L.R. (3d) 242 (C.A.)). [19] In the case at bar, the claimant suggests the following factors militate in favour of the court departing from the usual rule and to make an order for special costs (as excerpted from the claimant's written submissions): a. There have been ongoing delays in addressing matters as a result of the Respondent's continued requests for adjournments. The Respondent has also failed to provide materials in accordance with the Supreme Court Family Rules or in a timely manner. b. the Respondent sought two adjournments to obtain counsel, which he ultimately did not retain, and therefore represented himself throughout the various applications. The Respondent knowingly set a hearing date when he was already scheduled to be in trial. He advised at court on March 31, 2017 that he thought the other matter would settle; however, he failed to advise the court of this on February 28, 2017 when the March 31 date was set by consent. Had he raised it, a clear date could have been selected. c. The Claimant had entered into negotiations with the respondent with respect to terms on which the matters could be adjourned by agreement for the hearings on January 13, 2017 and March 31, 2017; however, agreement was not able to be reached with respect to those terms. As the applications were with respect to support, parenting time, a reunification program and a section 211 report, there was a need for the matters to be heard in a timely manner. d. The delay in matters also required additional affidavit material to be prepared to ensure that up-to-date information was before the court which resulted in additional expense for the claimant. e. The Respondent's unwillingness to communicate with the Claimant prevented the opportunity to resolve matters outside of the court process. His failure to provide his Application Responses and materials in accordance with the Rules or in a timely manner, left very little time, if any, for the Claimant to respond to those materials. For example, the Respondent provided a 74 page affidavit in response to the Claimant's affidavits filed February 24, 2017, March 26, 2017, June 29, 2017 and July 4, 2017, on July 14, 2017, the day of the hearing. f. As a litigator, the Respondent would be aware of the Rules of Court and the requirements therein. Further, the Respondent's actions in this case were contrary to the objects of the Supreme Court Family Rules which are to minimize conflict and promote cooperation and to secure the just, speedy and inexpensive determination of the case. j. In addition to the late materials, the Respondent withheld relevant information with respect to his income until the hearing of the matter. He only produced information regarding his dividends upon the request of the court during his submissions. k. The Respondent also failed to respond to communication regarding entry of the Orders. In the case of the spousal support payment, this precluded the Claimant from being able to apply to FMEP to enforce the support order. l. The Respondent was sent a draft of the Order from the February 28, 2017 appearance on April 12, 2017. Follow up correspondence was sent on May 19, 2017 and June 2, 2017. The Respondent did not reply and signed the Order at the hearing on July 14, 2017 when requested to do so by the court. m. The Respondent was sent a draft of the Order from the March 31, 2017 appearance on March 31, 2017. Follow up correspondence was sent on April 19, 2017, May 19, 2017 and June 2, 2017. The Respondent did not reply and only signed the Order at the hearing on July 14, 2017 when requested to do so by the court. n. The Respondent's failure to respond to correspondence and to provide comments on the draft Order or endorse same increases the cost of the litigation and is contrary to the object of the Rules of Court. o. As a lawyer, the Respondent would also be aware of his obligations to have orders entered and to comply with orders. [20] In the claimant's submission, the above list regarding the respondent's actions in this matter have caused delay and increased the costs of the litigation for the claimant. Accordingly, the claimant seeks an order for special costs as the totality of the respondent's behaviour is a form of misconduct deserving of the court's rebuke. [21] The case of Dyer, infra, explains how to apply R. 16-1(9)(a)-(b) commencing at para. 35: [35] Rule 16-1(7) provides that subject to subrule (9), costs of a family law case must be awarded to the successful party unless the court otherwise orders. [36] Subrule (9) provides: (9) Unless the court hearing an application otherwise orders, (a) if the application is granted, the party who brought the application is entitled to costs of the application if that party is awarded costs at trial or at the hearing of the petition, but the party opposing the application, if any, is not entitled to costs even though that party is awarded costs at trial or at the hearing of the petition, and (b) if the application is refused, the party who brought the application is not entitled to costs of the application even though that party is awarded costs at trial or at the hearing of the petition, but the party opposing the application, if any, is entitled to costs if that party is awarded costs at trial or at the hearing of the petition. [37] Thus, unless the court otherwise orders, the party who succeeds on the application will be entitled to costs of that application if that party is awarded costs at trial. [38] The court's discretion to "order otherwise" must be exercised judicially: Gold v. Gold (1993), 82 B.C.L.R. (2d) 180 at para. 20: The question, then, is: when should the Court order otherwise? With respect, when the court should order otherwise is a matter of discretion, to be exercised judicially by the trial judge, as directed by the Rules of Court. To lay down any strict guidelines or even to attempt to give exhaustive examples is not, I think, helpful because the facts and issues in each family law case vary so greatly. 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. Assessing the importance of such factors within the context of a particular case, however, is a matter best left for determination by the trial judge. Was there reprehensible conduct on the part of the respondent warranting an award of special costs? [22] Again, I quote from Dyer : [52] Under Rule 16-1(1)(b)(ii), the court may depart from the general rule that costs must be assessed in accordance with Appendix B of the Supreme Court Family Rules, and may order that the costs of an application be assessed as special costs. [53] Special costs are awarded to sanction reprehensible conduct, which encompasses both scandalous or outrageous conduct and milder forms of misconduct deserving of the court's rebuke: Garcia v. Crestbrook Forest Industries Limited (1994), 9 B.C.L.R. (3d) 242 at para. 17 (C.A.). The fact that a proceeding has little merit is not in itself a reason for awarding special costs. "Something more is required, such as improper allegations of fraud, an improper motive for bringing the proceedings, or improper conduct of the proceedings themselves, before the conduct becomes sufficiently reprehensible to require an award of special costs": Garcia at para. 23 [54] In Westsea Construction Ltd. v. 0759553 B.C. Ltd., 2013 BCSC 1352, Madam Justice Gropper summarized the principles for awarding special costs at para. 73: Based upon my review of the authorities, I have derived the following principles for awarding special costs: a) the court must exercise restraint in awarding specials costs; b) the party seeking special costs must demonstrate exceptional circumstances to justify a special costs order; c) simply because the legal concept of "reprehensibility" captures different kinds of misconduct does not mean that all forms of misconduct are encompassed by this term; d) reprehensibility will likely be found in circumstances where there is evidence of improper motive, abuse of the court's process, misleading the court and persistent breaches of the rules of professional conduct and the rules of court that prejudice the applicant; e) special costs can be ordered against parties and non-parties alike; and f) the successful litigant is entitled to costs in accordance with the general rule that costs follow the event. Special costs are not awarded to a successful party as a "bonus" or further compensation for that success. [55] The test for special costs set out in Garcia applies in family law proceedings: Tomic v. Tough, 2013 BCCA 355 at para. 35. [23] In Cully v. Cully, 2013 BCSC 2457, special costs were denied. In that case, the claimant sought special costs against the respondent with respect to a pre-trial application for breach of disclosure obligations. The respondent was served with the claimant's application materials but did not file any materials in response. At the hearing, the respondent was said to have failed and refused to produce a proper Form 8 Financial Statement pursuant to the Rules and was also said to be in breach of a court order to which he had consented to being granted. The respondent was also said to have, in a related proceeding, engaged in intentional delay to thwart those proceedings. [24] In Cully, the court went on to say: I do not have any authority before me discussing or ordering special costs based on a single application for breach of disclosure obligations. I am also aware of the general approach that, where special costs are awarded, they are to be for the entire proceeding. In other words, it is much more uncommon for them to be awarded at the interlocutory stage. [25] In E.D.A. v. M.A.A., 2014 BCSC 1084, special costs were denied where, in a family law proceeding, the respondent failed to comply with the Rules relating to document production, failed to comply with court orders, and, up until trial, failed to produce documents relating to his financial circumstances. He was also said to have engaged in intentional delay. Ultimately, the court determined, at the end of the trial, that an award of special costs of the trial would, in effect, punish Mr. A. twice for the same misconduct, since the court had already expressed its disapproval of the respondent's conduct through contempt proceedings and other penalties, which constituted sufficient sanctions for his misconduct. [26] Special costs were denied in Doman v. Ciccozzi, 2014 BCSC 866, where the respondent in this family law proceeding sought orders for document production and a financial penalty or special costs against the claimant. In this case, disclosure had been delayed. While neither party strictly followed the Rules in issuing their lists of documents, the claimant's initial document disclosure was much later and less complete than that of the respondent. The claimant also did not comply with orders and promises of production. The claimant did finally disclose most of the requested materials, but the disclosure only occurred because the respondent proceeded with this application. Ultimately, while finding special costs were not appropriate, the court found a modest financial penalty was appropriate. [27] Master Bouck then gave some consideration to s. 213 of the Family Law Act, S.B.C. 2011, c. 25 [FLA] at para 33: [33] Justice Punnett's decision in J.D.G. v. J.J.V. is both persuasive and binding upon me. A few key concepts that emerge from that decision have already been touched upon in these reasons. Other important concepts are: · s. 213 is to be used to secure proper disclosure in a timely and cost efficient way. It therefore requires robust application to accomplish that end: para. 25; · [if] the responding party makes disclosure prior to the hearing that may justify a lesser penalty. That said, the fact that the applicant had to bring the application should, notwithstanding the late production, be addressed both because of the expense incurred but, as well, the delay itself: para. 29; · each case will be fact dependent, but there is also a general deterrent element involved in that any order should increase the awareness of the importance of timely and complete disclosure and over time lead to fewer applications: para. 25. [28] Section 213 of the FLA provides: 213 (1) This section applies if a person (a) fails to comply with (i) an order for disclosure made under section 212 [orders respecting disclosure], or (ii) a requirement to disclose information in accordance with the Supreme Court Family Rules or the Provincial Court (Family) Rules, within the time or in the manner required by the order or Rules, or (b) provides information that is incomplete, false or misleading. (2) In the circumstances set out in subsection (1), the court may do one or more of the following: (a) make an order under section 212; (b) draw an inference that is adverse to the person, including attributing income to that person in an amount that the court considers appropriate, and make an order based on the inference; (c) require a party to give security in any form that the court directs; (d) make an order requiring the person described in subsection (1) to pay (i) a party for all or part of the expenses reasonably and necessarily incurred as a result of the non-disclosure of information or the incomplete, false or misleading disclosure, including fees and expenses related to family dispute resolution, (ii) an amount not exceeding $5 000 to or for the benefit of a party, or a spouse or child whose interests were affected by the non-disclosure of information or the incomplete, false or misleading disclosure, or (iii) a fine not exceeding $5 000; (e) make any other order the court considers appropriate. [29] Isacson v. Isacson, 2014 BCSC 2351 is a case where special costs were granted to the claimant. In his reasons given after a trial, the judge said this: [151] I find that the respondent has, throughout this litigation, put the claimant through unnecessary needless expense. Had he provided full financial disclosure in a timely way and had he not insisted upon equal parenting time, it is highly likely that there would have been no need for a ten day trial. Instead, tens of thousands of dollars have been spent needlessly, by both parties. [152] Given the respondent's conduct throughout this litigation and given that the claimant was substantially successful in respect of all issues other than the ownership of Allterra, I am ordering that the claimant is entitled to her costs throughout assessed as special costs. [30] After due consideration of the costs issue and the case law cited above, I have come to the conclusion that special costs are not appropriate in this case. I am not satisfied that the delays occasioned by the respondent were serious enough to incur special costs to reflect the Court's rebuke. Rather, costs are awarded to the claimant in the amount of $11,200.00 as submitted by her counsel. I determine this is an appropriate way to resolve the issue of costs, however, I also determine that the respondent pay a fine to the claimant in the amount of $1,500.00 pursuant to s. 213 of the FLA. It would seem appropriate to consider a fine for the behaviour mentioned more appropriate than an order for special costs, and one which should be considered in place of special costs. [31] The fine is levied for the lack of disclosure required of a litigant, and, in particular, this respondent, given his position as a lawyer who was less than forthcoming about his income until questioned by the Court during the respondent's submissions regarding spousal support. In fact, had the questions not been asked, the claimant might have received a reduced amount for spousal support than that to which I found she was entitled, as per para. 10 above. [32] As well, all applications which I heard were interlocutory applications made pending trial, where it is much less common to order special costs, rather than at the end of the proceedings. [33] The assessed costs and the fine are both to be paid to claimant's counsel, in trust for the claimant, within 21 days of the date of issuance of these reasons. "Master Taylor"