“When success is divided, the court has the explicit discretion under r. 24 (6) to determine the allocation of costs. One key issue under r. 24(6) is how to allocate success when neither party is the clear winner of a motion, trial or other proceeding.
In Jackson v. Mayerle, 2016 ONSC 1556 (SCJ-FC), Pazaratz J. considered how to apportion divided success under r. 24(6). He stated that r. 24(6) requires a comparative analysis, as most family cases have multiple issues. However, those issues are not equally important, time-consuming or expensive to determine. Comparative success can also be assessed globally in relation to the whole of the case, asking:
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- How many issues were there?
- How did the issues compare in terms of importance, complexity and time expended?
- Was either party predominantly successfulon more of the issues?
- Was either party more responsible for unnecessary legal costsbeing incurred?
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In Thompson v. Drummond, 2018 ONSC 4762, Chappel J. added to Pazaratz J.’s analysis. She pointed out that the determination of success is not merely a mathematical exercise. Rather, the court must engage in a “contextual analysis” in which it looks first to the kinds of factors set out in Jackson v. Mayerle. If it finds that success is divided, the court will then exercise its discretion. It may simply determine costs globally. Or it may look first to success in the primary issue, but subject to “adjustments” that consider lack of success in any secondary issues, as well as any other appropriate factors. As Chappel J. wrote at para. 12:
The determination of whether success was truly “divided” does not simply involve adding up the number of issues and running a mathematical tally of which party won more of them … Rather, it requires a contextual analysis that takes into consideration the importance of the issues that were litigated and the amount of time and expense that were devoted to the issues which required adjudication … Where the court concludes that success was in fact divided, it may award costs to the party who was more successful on an overall global basis or on the primary issue, subject to adjustments that it considers appropriate having regard for the lack of success on secondary issues and any other factors relating to the litigation history of the case …
There are two schools of thought regarding the role of offers to settle in the determination of success under r. 24. On the one hand, in Lawson v. Lawson, 2008 CanLII 23496 (ON SC), [2008] O.J. No. 1978 (S.C.J.), Justice J. Wilma Scott of this court’s family Court wrote that any determination of success “…must take into account how that order compares to any settlement offers made”: at para. 7. In Osmar v. Osmar, 2000 CanLII 20380 (ON SC), [2000] O.J. No. 2504 (S.C.J.), at para. 7, Aston J. was even more direct, in stating that:
Offers to settle become the yardstick by which to measure “success” and are significant in considering both liability for costs and the amount of those costs.
On the other hand, in Jackson v. Mayerle, Pazaratz J. considered offers to settle separately from the issue of relative success. His four factors do not include success in comparison to offers to settle. Similarly, Chappel J.’s analysis of divided success in Thompson v. Drummond did not consider offers to settle. Rather, elsewhere in her decision, she describes offers as “[a]nother important consideration in determining both entitlement to and the quantum of costs.”
In my view, offers to settle are imported into r. 24 only in regard to reasonableness and/or proportionality, not success. Further, while those offers need to be in writing, they do not have to meet the formal requirements of r. 18 in order to be considered under r. 24(12).”
Tharmalingam v. Balasubramanian, 2021 ONSC 4543 (CanLII) at 82-87