IN THE SUPREME COURT OF NOVA SCOTIA
(FAMILY DIVISION)
Citation: Jachimowicz v. Jachimowicz, 2007 NSSC 303
Date: 20071018
Docket: 1201-058994
Registry: Halifax
Between:
Cathy Jachimowicz
Petitioner
v.
Jan Jachimowicz
Respondent
Judge: The Honourable Justice Mona M. Lynch
Heard: July 30, 2007, in Halifax, Nova Scotia
Counsel: Charles D. Lienaux, for the Petitioner
Deborah I. Conrad, for the Respondent
By the Court:
Background:
[1] This is an application by the respondent, Jan Jachimowicz, for costs resulting from a Divorce trial and review. The only outstanding corollary issue was the custody and access of the parties’ son, Michael. Counsel confirmed that all other issues were agreed to by the parties and incorporated into a separation agreement which was signed by the parties in November 2004. The Separation Agreement was incorporated into the Corollary Relief Judgment for all matters except custody and access and as a result of the trial, child support. The trial resulted in custody of Michael changing to his father and the mother’s access being supervised.
[2] At the beginning of the Divorce trial counsel for the petitioner, Cathy Jachimowicz, indicated that she may be seeking a variation in child support. Counsel for the petitioner later indicated that they would not seek a variation in child support.
[3] The trial dealing with custody and access was spread over approximately thirteen days. There were six days of evidence from the initial trial. The Divorce and Corollary Relief Judgments were issued on March 28, 2006. The matter of access was set over for review and five days of evidence was heard on the review hearing. There were numerous other appearances which would add up to approximately two more days. The decision on the divorce hearing is Jachimowicz v. Jachimowicz, 2006 NSSC 82 and the review hearing is Jachimowicz v. Jachimowicz, 2006 NSSC 392.
[4] Prior to the completion of the review hearing, Cathy Jachimowicz applied to set aside the Divorce and Corollary Relief Judgments on the basis of perjury by Jan Jachimowicz for swearing a false statement of property. That application is being heard in a separate proceeding before another judge.
[5] On March 6, 2007 Jan Jachimowicz applied for costs of the proceeding. He is requesting costs on a solicitor-client basis.
[6] Counsel for Cathy Jachimowicz responded to the costs application on April 2, 2007 by requesting that I recuse myself and requesting disclosure of trust documents. Counsel for Cathy Jachimowicz was directed by a letter dated April 3, 2007 to set his application for recusal and request for disclosure down for a hearing and both counsel were provided filing directions. Counsel for Cathy Jachimowicz replied by letter dated April 9, 2007 that he would not be making an application for me to recuse myself or for production of the trust documents. Counsel for Cathy Jachimowicz was informed by letter dated April 11, 2007 that as he had chosen not to set the recusal motion and disclosure request down for a hearing that those matters would not be considered.
[7] On April 20, 2007 counsel for Cathy Jachimowicz filed an affidavit from Cathy Jachimowicz sworn to on April 16, 2007 which contained evidence not previously before the court. The only direction given by the court was that counsel for Cathy Jachimowicz was to file a response to the application for costs, including any case law he was relying on, two weeks prior to the hearing on costs.
[8] The matter of costs was set down for one-hour on July 30, 2007 to deal with questions the court had in relation to the submissions. Further directions for filing were given on July 30, 2007 which required counsel for Jan Jachimowicz to file a breakdown of the bill for legal services and disbursements. Counsel for Cathy Jachimowicz was given an opportunity to respond.
Issues:
[9] (a) Should the application for costs be dismissed?
(b) Is Jan Jachimowicz entitled to costs in the circumstances of this case?
(c) If so, should the costs be awarded on a solicitor-client basis?
(d) If solicitor-client costs are not appropriate what is the appropriate costs award?
Analysis:
[10] An award of costs is in the discretion of the trial judge. I was the judge who heard evidence in this matter for thirteen days. I am the judge who must decide the matter of costs resulting from the matter.
(a) Should the application for costs be dismissed?
[11] Counsel for Cathy Jachimowicz has requested a dismissal of the application for costs. The basis for that request is that Jan Jachimowicz did not provide proper disclosure prior to the signing of the separation agreement which was incorporated into the Corollary Relief Judgement. In response to the costs application, counsel for Cathy Jachimowicz objected to my jurisdiction to rule on costs. The first basis was that the divorce proceedings were not finished as there was an application to set aside the Divorce Judgment and the Corollary Relief Judgment. Counsel submits that because the application to set aside the judgments has not been heard that I do not have jurisdiction to deal with the matter of costs. Civil Procedure Rule 63.02(3) provides me jurisdiction to deal with costs at any stage of a proceeding. The proceeding does not need to be completed. I have jurisdiction to hear the application for costs and award costs.
[12] Despite being directed to set down his application for my recusal, counsel for Cathy Jachimowicz requested that I recuse myself in his response to the costs application. Counsel for Cathy Jachimowicz was given direction by the court as to how his recusal motion would be heard and he chose not to have the matter of recusal set down for a hearing. I will not consider the recusal request. I was the judge who heard the trial and I will decide the matter of costs.
[13] Counsel for Cathy Jachimowicz submits that costs should be refused on the basis of the misconduct of Jan Jachimowicz for failing to make full disclosure. The only matters in issue before me were the formalities of the divorce and custody and access of Michael. Counsel for both parties informed me that all other matters were settled. At the beginning of the divorce trial counsel for Cathy Jachimowicz raised the possibility of a variation in child support. Counsel then indicated that they would not be seeking a variation in child support. All property and support matters were settled. Jan Jachimowicz’s property and financial circumstances were not relevant to any matter in dispute. At the end of the custody hearing Jan Jachimowicz was awarded custody of Michael. The only financial information which would have been relevant to child support would have been the financial information of Cathy Jachimowicz.
[14] Counsel for Cathy Jachimowicz further submits that the trust documents requested were necessary in the costs application to prove misconduct by Jan Jachimowicz. He alleges that Jan Jachimowicz is in violation of various statutory requirements by failing to disclose the trust deeds. A further submission is that an adverse inference must be drawn against Jan Jachimowicz. If the documents sought were relevant or material to any issue that was being decided, an inference could be drawn. However, in this case, the property and financial circumstances of Jan Jachimowicz were not relevant or material to any issue being decided. Counsel for both parties indicated that the only matters in dispute were custody and access.
[15] The next submission is that I should deny costs to Jan Jachimowicz because he is guilty of perjury. I did not hear evidence on the issue of whether Jan Jachimowicz is guilty of perjury or not. Failure to file material that is not relevant to any issue being decided is not misconduct which would disentitle a successful party to costs.
[16] Counsel for Cathy Jachimowicz requested that counsel for Jan Jachimowicz properly document the request for solicitor-client costs. Counsel for Jan Jachimowicz was directed to file that material and counsel for Cathy Jachimowicz was provided time to respond.
[17] The request by Cathy Jachimowicz to dismiss the application for costs by Jan Jachimowicz is denied. There has been no failure to disclose material evidence. There has been no other misconduct that would warrant the dismissal of the costs application.
(b) Is Jan Jachimowicz entitled to costs in the circumstances of this case?
[18] Civil Procedure Rule 63.03(1) provides that unless the court otherwise orders, costs shall follow the event. The general rule for costs in family matters is set out by Hallett J. (as he then was) in Bennett v. Bennett, [1981] N.S.J. No. 10 (N.S.S.C.T.D.) at paragraph 9:
Costs are a discretionary matter. It is normal practice that a successful party is entitled to costs and should not be deprived of the costs except for a very good reason. Reasons for depriving a party of costs are misconduct of the parties, miscarriage in the procedure, oppressive and vexatious conduct of the proceedings or where the questions involved are questions not previously decided by a court or arising out of the interpretation of new or ambiguous statute (Orkin's Law of Costs (1968)).
And at paragraph 14 Orkin’s Law of Costs is referred to again:
The law relating to the exercise of a judge's discretion as to costs is summarized in Orkin's Law of Costs (1968), in the following paragraphs. At p. 12:
A successful litigant has by law no right to costs. Although he may have a reasonable expectation of receiving them, this is subject to the court's absolute and unfettered discretion to award or withhold costs. This discretion, which is absolute, is a judicial one to be exercised according to the circumstances of each particular case and based upon material before the court. It is the discretion of the trial judge and its exercise is not to be referred to delegated; nor can it be fettered by any consent of the parties, even though great weight should be given to such consent; nor should it be interfered with on appeal.
At p. 16:
As a rule costs should follow the result. That is to say, it is well settled that where a plaintiff is wholly successful in his action and there is no misconduct on his part, he is entitled to costs on the ground that there is no material on which a court can exercise a discretion to deprive him of costs.And at pp. 18-19:
The rule that a successful party is entitled to his costs is of long standing, and should not be departed from except for very good reasons.
[19] Rule 57.27 provides that costs in a matrimonial cause shall be recovered in the same way as in an ordinary proceeding.
[20] Rule 63.02(1), among other things, allows an award of a gross sum in lieu of or in addition to any taxed costs.
[21] In the present case, the only matters in issue were custody and access. Jan Jachimowicz was wholly successful. Custody of Michael was awarded to him. As I have stated above, there was no misconduct on the part of Jan Jachimowicz in relation to the matters of custody and access. There is no very good reason that would cause me to depart from the general rule. Jan Jachimowicz is entitled to costs.
(c) If so, should the costs be awarded on a solicitor-client basis?
[22] Having decided that Jan Jachimowicz is entitled to costs, is he entitled to costs on a solicitor-client basis? In P.A. Wournell Contracting Ltd. v. Allen (1980), 37 N.S.R. (2d) 125 (N.S.S.C.A.D.), MacDonald, J.A., quoted Orkin on Costs at paragraph 30:
In The Law of Costs (1968), by Mark M. Orkin, the author says at pp. 53-54:
In a dispute inter partes the court has a general discretionary power to award costs as between solicitor and client, although not by way of damages. The power, which was originally an equitable one, may be exercised in special cases such as suits affecting charity funds, actions brought by trustees, administration suits, cases where an arbitrator has power to dispose of the question of costs, and in certain cases of misconduct. Costs as between solicitor and client may also be allowed in contempt proceedings. In proceedings involving estates an executor is normally awarded costs out of the estate on a solicitor and client basis. However, in other cases, as against an opposite party an executor is on the same footing as any individual litigant, and is not entitled to solicitor and client costs. Costs as between solicitor and client will be ordered where they were so payable ex contractu to a mortgagee by virtue of his mortgage instrument.
And at paragraph 35:
I think there is much to be said for Mr. Chipman's argument as to the power of trial Judges in this province to award costs on the basis of a solicitor and his client. With some hesitation, however, I am of the view that such power does exist but should be exercised only in rare and exceptional cases such as enumerated in the above quotation from Orkin and never should they be awarded by way of damages.
[23] Solicitor-client costs are awarded only in rare and exceptional cases. Is this such a case? Was there serious misconduct on the part of Cathy Jachimowicz in the custody and access proceeding that would warrant an award of solicitor-client costs? I found that Cathy Jachimowicz was not credible. I found that her behaviour was putting Michael in danger. I found that her behaviour did not stop after the first decision awarding custody of Michael to his father. She continued to attempt to alienate Michael from his father. I found that her conduct ought not to be tolerated. The conduct of Cathy Jachimowicz lengthened the proceedings by requiring more witnesses.
[24] This case is clearly a case where the conduct of Cathy Jachimowicz was unacceptable. While it is very close to one of the most unusual cases where solicitor-client costs should be awarded, I find that an award of solicitor-client costs is not appropriate in this case.
[25] Counsel for Cathy Jachimowicz raises concerns about the disclosure and detail of the statements of account provided by counsel for Jan Jachimowicz. Having decided that solicitor-client costs are not appropriate in this case, I will not deal with the adequacy of the statements of account.
(d) If solicitor-client costs are not appropriate what is the appropriate costs award?
[26] In the normal course, costs are fixed in accordance with the Tariffs in Rule 63. In Urquhart v. Urquhart (1998), 169 N.S.R. (2d) 134 (N.S.S.C.), Goodfellow J. applied a rule of thumb by using Tariff A in Rule 63 and using $15,000 for each day of trial where there is no clear amount involved. Based on the fact that Urquhart was decided almost ten years ago, it would be appropriate to increase the rule of thumb to $20,000 to reflect the increased costs of litigation. Using Tariff A this would result in costs somewhere between $17,063 and $28,438.
[27] While the conduct of Cathy Jachimowicz did not warrant an award of solicitor-client costs, her conduct can also be taken into account in awarding party and party costs. In addition to the conduct noted above, I have considered that an agreement was reached between the parties in 2004 for custody and access and it was the conduct of Cathy Jachimowicz which resulted in the custody and access agreement not being successful.
[28] Another consideration in costs is the length of trial. The proceedings amounted to approximately thirteen days. The complexity of the trial is another consideration. This was a complex trial with many witnesses.
[29] I must also consider disbursements. Jan Jachimowicz includes in his disbursements $42,071.87 for the Jenkins Group. This was the private detective firm hired to protect Michael when he was running from school. Mr. Jenkins gave evidence at the review hearing regarding his observations of Cathy Jachimowicz. Mr. Jenkins’ testimony helped the court reach the conclusion that Cathy Jachimowicz was involved in Michael’s running behaviour. I find that some of the disbursements from the Jenkins Group are appropriate disbursements in the litigation. However, the majority of the costs of the Jenkins Group services were to protect Michael and not necessarily related to the litigation.
[30] There would be significant other disbursements in this lengthy matter. Counsel for Jan Jachimowicz provided the total for other disbursements as $29,362.51. I do not have a breakdown of what is included in those disbursements.
Conclusion:
[31] Taking into account all of the above, I award Jan Jachimowicz costs in the amount of $50,000 inclusive of disbursements.
J.