Wednesday June 19, 2019

Bad Faith and Costs Consequences

Authored by: Terrance G. Sheppard Posted in: Family Law

Litigants are not rewarded for bad behaviour. In a recent decision out of the Ontario Superior Court of Justice, a father was ordered to pay $420,000 in costs to his former spouse, after losing the case for custody of their young daughter.

The term “bad faith” generally denotes behaviour that is deceitful, harmful and all around unsuitable in court proceedings. To safeguard against such behaviour, judges have discretion to order that litigants pay the legal fees of the other side when such actions are taken. In Nova Scotia, the Civil Procedure Rules indicate that “a presiding judge may, at any time, make any order about costs as the judge is satisfied will do justice between the parties.”1 Similar rules exist in jurisdictions throughout the country. Normally, the amount awarded in costs is a fraction of the actual legal fees incurred by the winning side.

In this case, Justice Kristjanson found that, throughout the 12-day custody and access trial, the father’s unreasonable behaviour rose to the level of bad faith and warranted an award for full costs to the mother. Quoting a previous decision of the same court, the judge stated that “the essence of bad faith is when a person suggests their actions are aimed for one purpose when they are aimed for another purpose.”2

The decision names a number of actions the judge took issue with. Most significantly, the father launched false allegations about the mother and misled the Court by failing to withdraw those allegations. He also refused to sign travel consents for the child, failed to consult the mother on medical and extracurricular issues, dismissed her attempts to consult and refused her parenting time. This unreasonable behaviour further complicated the case and drove up legal fees on both sides.

When faced with the figure for costs, the father argued the number was exorbitant as a result of over-lawyering and excess time spent on the case. The judge disagreed. In making her order for costs, Justice Kristjanson cited the father’s own unreasonableness as the key reason for the large bill. The mother was made to spend significant time addressing his false allegations and unreasonable behaviour.

Additionally, the father seemed unwilling to accurately disclose his own bill. Justice Kristjanson indicated that the Court would compare the two bills to assist in evaluating whether the mother’s legal fees were reasonable. When asked to present a full record of costs, the father failed to account for the full period for which his lawyer had been retained, instead presenting only a partial record.

Ultimately, the Court found that the father’s unreasonableness rose to the level of bad faith. The judge exercised her discretion to award full costs to the mother, achieving a result she deemed reasonable in the circumstances. She stated: “the costs order in this case in part reflects the goal of discouraging and sanctioning inappropriate behaviour.”3 Litigants should be aware that unreasonable actions can have expensive consequences in court proceedings.

Lawyers at BOYNECLARKE LLP are committed to practicing and litigating with honour. If you are looking for legal advice, please call 902-469-9500 to schedule your free 30-minute consultation with a member of our Family Law team.

 


1 Nova Scotia, Civil Procedure Rules, r 77.02(1).

2 S. (C.) v. S. (M.), 157 A.C.W.S. (3d) 923 at para 16, [2007] O.J. No. 2164, Perkins J.

3 Goldstein v. Walsh, 2019 ONSC 3174 at para 35, 2019 CarswellOnt 8310 Kristjanson J.

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