4.24: Formal offers to settle
4.29: Costs consequences of formal offer to settle

Case Summary

After deciding a family law Trial, Justice Khullar reserved jurisdiction to determine whether a further remedy should be awarded to the Applicant wife under the Matrimonial Property Act, RSA 2000, c M-8 to carry out enforcement of the Judgment arising from Trial, and to speak to Costs arising from the Trial if the parties could not agree.

Neither party was entirely successful at Trial. The husband was ordered to make payments to the wife, but the majority of his assets were tied up in a corporation. Justice Khullar first considered whether the Court should lift the corporate veil to carry out enforcement of the Judgment. Her Ladyship noted that the husband clearly controlled the corporation, and while it was incorporated for valid business reasons, it committed a number of wrongs that negatively impacted the wife and her ability to obtain her share of the matrimonial property. As such, Khullar J. lifted the corporate veil to allow the wife to register a security interest in the husband’s shares in the corporation, and against a building owned by the corporation.

Next, Khullar J. considered Costs. The wife argued that she was entitled to Costs as the successful party, having obtained Judgment for spousal support which the husband had initially opposed. The husband argued that the wife was not entitled to Costs, because the relief she received was different from what she had asked for. Justice Khullar noted that in family law matters, there are often no real “winners”, but held that the wife was generally successful and entitled to a Costs award. Her Ladyship also held that the wife’s draft Bill of Costs, which included fees based on Column 5, and were doubled after one of two formal offers was made, was reasonable. Justice Khullar came to this conclusion despite the husband’s objection to experts’ fees, which he argued were too high.

Lastly, Khullar J. considered whether the wife was entitled to double Costs pursuant to Rules 4.24 and 4.29, on the basis that the Judgment resulting from the Trial exceeded her formal offer. The husband argued that the wife’s offer was uncertain and invalid, and therefore did not entitle her to double Costs. Alternatively, he argued that uncertainty constituted a “special reason” to rebut the presumption of double Costs, pursuant to Rule 4.29(4).

Her Ladyship held that the wife’s offer was uncertain. It was based on the sale of certain assets, and as such the value she would have received if the offer were accepted was not entirely clear. Given that the double Costs rules are “punitive in nature and therefore demand a high degree of certainty and exactness”, Khullar J. exercised her discretion pursuant to Rule 4.29(4) not to award double Costs in the circumstances.

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