Jan 11, 2016

The Price of Bad Faith Behaviour in Family Law Cases

D.B. v. R.S., 2016 ONCJ 11 (CanLII)

Introduction

The decision of the Ontario Court of Justice in D.B v R.S 2016 ONCJ 11 confirms the cost consequences of bad faith behaviour in family law cases. In this case, Justice Jones held that the Applicant was entitled to full recovery of her costs because of the Respondent’s behaviour, among other things. Here, the Respondent had tried on several occasions to have the Applicant’s lawyer removed from the record by “complaining to the judge, to legal aid, and to the Law Society.” The Applicant claimed that most of the costs had “arisen because of the incompetence and greed of [the] mother’s counsel.” The Respondent also argued that the Applicant’s lawyer was “incompetent, greedy, or a liar.” Justice Jones observed that the Respondent’s actions displayed his intent to get rid of the Applicant’s lawyer, and the Respondent’s belief that getting rid of the Applicant’s lawyer would benefit him. Justice Jones held that the Respondent’s bad faith behaviour needed to be sanctioned and deterred.

The Law

Justice Jones considered rule 24(8) of the Ontario Family Law Rules, which states that: “[i]f a party has acted in bad faith, the court shall decide costs on a full recovery basis and shall order the party to pay them immediately.”

Justice Jones also considered the case S(C) v S.(M.) 2007 CarswellOnt 3485 where the Ontario Superior Court reviewed the meaning of bad faith:

“16. ….”Bad faith” has been explained as “not simply bad judgment or negligence but rather it implies the conscious doing of a wrong because of dishonest purpose or moral obliquity…(it contemplates a state of mind affirmatively operating with furtive design or ill will” See Biddle v. Biddle,[2005] O.J. No. 1056 (Ont. S.C.J.) at par. [14]. ….The essence of bad faith is the representation that one’s actions are directed toward a particular goal while one’s secret, actual goal is something else, something that is harmful to other persons affected or at least something they would not willingly have supported or tolerated if they had known. However, not all bad faith involves an intent to deceive. It is rare but not uncommon in family law cases, for bad faith to be overt---an action carried out with an intent to inflict harm on another party or a person affected by the case without an attempt to conceal the intent [emphasis added]….

21….There are, however, some aspects of the father’s behaviour in this case…….that do fall within “bad faith” as intended by the rule. ….He made complaints against lawyers and other professionals, when he was unhappy with the way they performed their duties, not merely to report what he believed to be negligence or misconduct, but also as his form of punishment and vengeance [emphasis added]….”

Justice Jones determined that the Respondent had demonstrated bad faith and proceeded to award costs on a full recovery basis. To determine what was “fair and reasonable” in a costs award, Justice Jones considered three factors from the case Izyuk v Bilousov 2011 ONSC 7476:

  1. to partially indemnify successful litigants for the cost of litigation;
  2. to encourage settlement, and;
  3. to discourage and sanction inappropriate behaviour by litigants.

Result

Justice Jones found that all three factors justified awarding $30,000 in costs inclusive of disbursements and H.S.T because:

  1. the Applicant deserved to be reimbursed for her costs and had made a reasonable offer to settle which the Respondent rejected;
  2. the costs would encourage the Respondent to consider settlement in future and encourage him to assess the reasonableness of his positions;
  3. the costs award would encourage respect for the court process.

Commentary

D.B v R.S. underscores the importance of acting reasonably throughout the court process and the costs of not doing so. The courts will not tolerate attempts to manipulate the court process to attack your former partner or their counsel and will penalize the misbehaving party with an adverse cost award. This case also shows some of the complications that can arise when a party acts without a lawyer. Here, the unrepresented Respondent submitted 200 pages of exhibits on what should have been a five-page argument on costs, where he made several of his claims about the Applicant’s counsel being dishonest. This is not to suggest that a represented party is incapable of acting in bad faith, but that counsel could advise a client about the impact of such behaviour.

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The above is not intended to be legal advice or a substitute for legal advice. If you are experiencing a legal problem you should consult a lawyer to help you.