Contentious court disputes can come with costly consequences

By Tony Poland, LegalMatters Staff • A recent judgment awarding a father more than $667,000 in court costs in a protracted parenting dispute should serve as a reminder of the need to consider every potential consequence of litigation, says Toronto family lawyer A. Julia P. Tremain.

Tremain, a partner with Waddell Phillips Professional Corporation, says contentious court disputes can be time consuming and expensive. And you may not only have to pay your own lawyer, but court can also order you to pick up a portion of your former partner’s legal bill if the judgment goes against you.

“People are sometimes unaware that court costs can become an issue if they are unsuccessful in their case,” she tells LegalMattersCanada.ca. “They get completely focused on the litigation and they forget that if they lose, they may be liable for some of the ex-spouse’s expenses. 

“As lawyers, we remind clients of this before trial. But sometimes in family law people get a little blinded to what may happen because they are so often convinced that they are on high moral ground. They don’t believe there is a realistic chance that they are going to lose.”

Earlier this year, Superior Court Justice Heather McGee awarded a man primary care of his two sons following a trial that lasted nine weeks. She notes the dispute cost the estranged couple “$1.7 million dollars, an amount that well exceeded their personal savings and their equity in a jointly owned home.” 

Mother ‘acted in bad faith’

In her decision, McGee found the mother in the case “acted in bad faith” and awarded $677,610 in court costs to the father. 

“Family law litigants are accountable for the positions they take in litigation. They have an obligation to assess their cases at the outset and to reassess as the case unfolds,” McGee writes. “Family law litigants are responsible not only for their litigation positions, but also for the financial consequences to both parties of funding those positions. A former spouse who engages in ‘win at all costs’ litigation chooses to be as answerable for the resulting litigation fees to the other side as for one’s own fees.

Tremain, who was not involved in the case but comments generally, says many people may not “truly understand how expensive going to court can be.”

“Costs can add up and it is generally more than people estimate. It is rarely less,” she says. “People start off with an initial retainer with a lawyer and often don’t realize that retainer will need to be replenished.

“There are often expenses such as parenting assessments that cost money. You may be looking at such things as business valuators if there are financial disputes.”

Tremain explains that a winning litigate can also ask to be reimbursed for a portion of their court costs. 

Factors in deciding a cost award

Under Family Law Rules, court will consider the following when deciding on a cost award:

• each party’s behaviour;
• the time spent by each party;
• any written offers to settle;
• any legal fees, including the number of lawyers and their rates;
• any expert witness fees, including the number of experts and their rates;
• any other expenses properly paid or payable; and
• any other relevant matter.

“Costs rules are designed to indemnify successful litigants; to encourage settlement; and to discourage and sanction inappropriate litigation behaviour by litigants,” writes McGee in her judgment. “In high conflict parenting cases, the critical purpose of an award of costs is to curb litigation behaviour by providing a sanction for unreasonable litigation conduct. Unless costs are consistently and predictably awarded in accordance with the Family Law Rules there is no downside to saying one thing and doing another.”

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The judge found the mother was liable for costs because she claimed to be supporting an ongoing relationship between her two sons and their father while actually attempting to sever it.

Tremain says the court will take a number of factors into consideration when deciding on costs. One of those factors is the ability to pay. 

“But it doesn’t necessarily get you off the hook,” she warns.

In this case, the mother claimed she could only afford to pay $50,000. However, the judge was unconvinced.

‘Costs must be reasonable and proportionate’

“A full recovery of costs is not necessarily a dollar-for-dollar recovery of everything spent during a course of litigation. Costs must be reasonable and proportionate,” McGee writes. “At no time did Ms. A conduct herself as a litigant of limited means on the parenting issues. To the contrary, her litigation decisions were funded on a ‘win at all costs’ basis.”

Divorce and parenting disputes can be contentious but litigants need to take a close look at their motivations and the potential fallout, says Tremain.

“This was a significant cost award but it really does show what happens if someone takes an unreasonable position,” she says. “This reminds us as lawyers that we need to address this issue with clients so they have a clear understanding of the consequences of the decisions they make.”