Background

Price v. Reid is a cost decision arising from a one-day child support trial before the Ontario Court of Justice. Justice S.B. Sherr released the trial decision on July 10, 2013, followed by written reasons on costs on August 13, 2013. Although the legal issues at trial were relatively straightforward, the Court’s cost endorsement provides important guidance on how Ontario courts approach costs in family law, particularly where disclosure failures and rejected settlement offers drive unnecessary litigation.

The parties are the parents of a child. The mother sought child support from the father. The dispute centered on determining the father’s income, adjusting child support retroactively, and fixing arrears. At trial, the Court fixed the father’s income at $43,935 annually, ordered retroactive adjustment of child support back to January 1, 2010, and calculated child support arrears of $18,989. These findings framed the subsequent costs analysis, as they established the mother as clearly successful party.

Following the release of the trial decision, both parties delivered written submissions addressing costs. The mother sought full recovery costs in the amount of $4,542.60. The father conceded that some costs were appropriate but argued for a significantly reduced award of $1,800, payable at $50 per month, relying on his financial circumstances. The Court was therefore required to determine not only whether costs should be awarded, but also the appropriate quantum, scale, and payment structure.

The Law

Justice Sherr reaffirmed that costs in family law proceedings are not exceptional or punitive. Rather, they serve well-established purposes articulated by the Ontario Court of Appeal in Serra v. Serra: to partially indemnify the successful party, to encourage settlement, and to discourage unreasonable litigation conduct.

Under Rule 24 of the Family Law Rules, there is a presumptive entitlement to costs in favor of the successful party. Success is the starting point of the analysis, not the end of it. Courts must also consider settlement behavior, proportionality, the reasonableness of each party’s conduct, and whether the litigation was made more complex or expensive than necessary. Importantly, formal offers to settle play a central role in the cost analysis, particularly where a party rejects a reasonable offer and achieves a worse result at trial.

Analysis

When will an Ontario court order cost because of unreasonable conduct in a family law case?

Ontario courts will order costs where a party’s conduct unnecessarily increases the length, complexity, or expense of the litigation. Unreasonable conduct does not require bad faith or dishonesty. It is enough that a party fails to comply with their procedural obligations, resists disclosure, advances positions unsupported by evidence, or refuses to engage meaningfully in settlement.

In Price v. Reid, the Court found that the father’s conduct crossed this threshold. Although the legal issues were not complex, the case was made significantly more difficult by the father’s failure to provide timely and accurate financial disclosure. This failure forced the mother to pursue litigation steps that would otherwise have been unnecessary. The Court was clear that disclosure failures strike at the heart of the family justice process and weigh heavily in favor of a costs award.

How did the mother’s offer to settle affect the cost outcome?

The mother made a formal offer to settle that complied with Rule 18(14) of the Family Law Rules. In that offer, she proposed fixing the father’s income at $40,000, adjusting child support retroactively to January 1, 2010, and fixing arrears at $17,545. The father rejected the offer.

The trial result was more favorable to the mother than the terms of her offer. As a result, the statutory cost consequences were engaged. Justice Sherr applied the presumption entitling the mother to partial indemnity costs up to the date of the offer and full recovery costs thereafter. The Court emphasized that settlement offers are not merely negotiating tools; they are benchmarks against which reasonableness is measured. Rejecting a reasonable offer carries predictable cost consequences when the rejecting party later does worse.

Does a party’s limited financial means protect them from a cost award?

No. While ability to pay is a relevant consideration, it does not immunize a party from costs, particularly where that party’s own conduct contributed to the litigation. Justice Sherr acknowledged the father’s modest financial circumstances but held that this factor could not override the presumption in favor of costs where the father acted unreasonably.

The Court relied on appellate authority confirming that financial hardship does not excuse disclosure failures or obstructive litigation behavior. Instead, the appropriate response is to structure the payment of costs in a manageable way, rather than to deny costs altogether.

How closely do courts scrutinize the amount of costs claimed?

Very closely. Although the mother was clearly entitled to costs, the Court carefully reviewed her bill of costs to ensure compliance with proportionality principles.

What role does disclosure play in the cost analysis?

Disclosure was central. The Court emphasized that financial disclosure is the cornerstone of family law proceedings, particularly in child support cases. Without proper disclosure, courts cannot assess income, evaluate settlement offers, or encourage early resolution. In Price v. Reid, the father’s disclosure failures were a primary driver of the litigation and a key reason why costs were awarded against him.

The Court rejected any suggestion that late or partial disclosure cured earlier non-compliance. Costs focus on the litigation steps that were made necessary by unreasonable conduct, not on whether disclosure was eventually produced after damage had already been done.

Conclusion

In the end, the Court awarded the mother total costs of $3,390, consisting of partial indemnity costs up to June 27, 2013, full recovery costs thereafter, disbursements, and HST. Recognizing the father’s financial circumstances, the Court permitted repayment at a rate of $150 per month, beginning October 1, 2013.

Price v. Reid is a clear illustration of how Ontario family courts enforce the presumption of costs where a party fails to disclose properly and rejects reasonable settlement offers. The decision reinforces that costs in family law are neither symbolic nor rare. They are a central tool used to compensate successful litigants, promote settlement, and discourage conduct that undermines the efficient and fair resolution of disputes. The case serves as a reminder that in family law, how parties litigate can be just as important as the positions they take.