FJN v JK, 2019 ABCA 305
WATSON, SLATTER AND O'FERRALL JJA
4.29: Costs consequences of formal offer to settle
14.88: Cost awards
SCHEDULE C: Tariff of Recoverable Fees
The Appellant appealed a Costs Decision of the Trial Judge following a Trial regarding child support obligations. The Trial Judge found that the Appellant had engaged in litigation misconduct by being uncooperative as a witness, by attempting to mislead the Court through his evidence, by not being forthcoming with financial disclosure, and by failing to admit parentage which led to a previous contested Application.
In the Costs Decision, the Trial Judge applied Column 4 of Schedule C, considering the amount at issue was to include the amount of child support to be paid until the child turned 18. The Trial Judge also doubled the Column 4 Costs on account of litigation misconduct, for both Trial Costs and for prior steps and Applications. The Trial Judge also disregarded a settlement offer made by the Appellant on the basis that it included a request for the Respondent’s husband to adopt the child.
The Appellant alleged that the Trial Judge erred by applying the wrong column of Schedule C, by awarding misconduct Costs, by altering prior Costs orders, and by ignoring a genuine settlement offer.
The Majority noted that Costs awards are discretionary and should only be set aside where there was an error in principle, or the award was plainly wrong. The Majority found that the Trial Judge erred by including all child support to age 18 in the calculation of the quantum for the purposes of determining the appropriate Schedule C column. The Majority held that Column 2 of Schedule C was the appropriate column.
Regarding the enhanced Costs award, the Majority noted that the Trial Judge cited the correct principle, which is that Costs for the Trial are influenced by Trial conduct, not general conduct. However, the Majority found that this principle was not applied, as the Trial Judge considered pre-Trial conduct as justifying advanced Costs including for steps where Costs had already been ruled on by previous Courts. The Majority also determined that there was nothing objectionable about the Appellant’s disclosure which would justify enhanced Costs. The Majority also held that the Trial Judge erred by applying double Costs based upon a rejection of the Appellant’s evidence, noting that doing so would “virtually justify double costs against the loser in every case”. The Majority also held that the Trial Judge erred in law by doubling fixed Costs amounts which had already been calculated by prior Judges.
Regarding the settlement offer made by the Appellant, the Majority noted that the offer was not governed by Rule 4.29 or Calderbank principles, that the financial offer made by the Appellant was found to be “reasonable, even generous”, and would have been better than the sums ultimately awarded by the Court of Appeal. The Majority held that it was not “unseemly” for the Appellant to include a request for the Respondent’s husband to adopt the child as it would bring finality to his financial obligations. The Majority found that the offer was a bona fide offer with adequate time for consideration, which should be factored in the determination of Costs “to affirm the policy supporting settlement offers”. The Majority held that Costs should be payable on Column 2 of Schedule C up to the date of the offer, and that the parties should bear their own Costs thereafter.
The Majority noted that the default position for Appeal Costs under Rule 14.88 is that Costs are awarded to the party who had substantial success on Appeal. The Majority also commented that ordering no Costs on Appeals in family law cases discourages parties with good cases but weak resources. The Appellant was found to be substantially successful on Appeal and was awarded Costs for the Appeal on Column 2 of Schedule C.View CanLII Details