How the Court Fights Back – Hartshorne v Hartshorne, 2011 BCCA 29

Hartshorne v Hartshorne (2011) Overview

• In this case, which stems from an appeal, the court dealt with the trial judge’s orders regarding spousal support, child support, and costs of the trial.
• The trial judgement, which took place two years earlier over 10 days, awarded Ms. Hartshorne lump sum spousal support of $350,000.
• Ms. Hartshorne was also awarded increased child support for the two children of the marriage, and her cross-appeal to increase her interest in the matrimonial home was dismissed.
• One year prior, the Court of Appeal upheld the trial judge’s award for double costs, which Mr. Hartshorne is appealing in this case.
• The award for double costs came in response to Ms. Hartshorne offering Mr. Hartshorne a comprehensive offer to settle that he turned down.

Hartshorne v Hartshorne, A History

• The parties in this case had a very lengthy divorce, extending back to 1998.
• Their litigation stemmed from a ‘marriage agreement’ that both parties signed but that Ms. Hartshorne later claimed was unfair against her and tried to have set aside. That agreement left the bulk of Mr. Hartshorne’s assets with him, as opposed to the equal division that is assumed under the Divorce Act.
• In 2001, Mr. Hartshorne agreed to transfer title to Ms. Hartshorne as part of an agreed-upon plan for the division of assets upon their divorce.
• In 2007, Mr. Hartshorne applied to the court for an order for sale of the family home, but that order was dismissed.
• Also in 2007, Ms. Hartshorne applied for spousal support and increased child support. The parties agreed that the payment should be in lump-sum form, but could not agree on the amount.
• Ms. Hartshorne asked for a retroactive increase in child support going back to 2005, but the court found that in her Offer made to Mr. Hartshorne, she noted that his child support payments did not increase when his income increased in 2002, as they should have, and when she applied for a variation to seek that increase.
• The trial judge found that Ms. Hartshorne’s offer “was a reasonable one, providing a compromise resolution of a long and difficult litigation,” and that it should have been accepted.
• He also noted that, on balance, the offer was more favourable to Mr. Hartshorne than was the outcome at trial.

Why This Decision Is Important

This case makes clear that an award of double costs is intended to be a punitive measure, used to punish a litigant for their failure to accept a settlement offer that is reasonable in the circumstances. In this way, the court is encouraging litigants to settle wherever possible, and to carefully analyze of the strength or weakness of their case, both at the beginning of the process and throughout it, to determine if it is worth going to trial.

The Supreme Court Civil Rules set out the basis on which a court considers making an award for double costs:¹

• Whether the offer to settle was one that ought reasonably to have been accepted, either on the date that the offer to settle was delivered on or any later date;
• The relationship between the terms of settlement and the final judgement of the court;
• The relative financial circumstances of the parties;
• Any other factor the court considers appropriate.

In considering these factors, the Court of Appeal in Hartshorne (2011) made a couple of clarifying points. First, the reasonableness of the offer to settle is not determined in relation to the award that is ultimately made, but whether, at the time it was open, it would have been reasonable to accept. In other words, this is not a backward-looking consideration but one made in the context of the time it was offered. Reasonableness is assessed by considering the timing of the offer, the relation between the offer and the claim (as opposed to being frivolous), whether it could be evaluated, and whether some reasoning was provided for the terms offered.

The court also specifically highlighted the “blameworthy conduct” of Mr. Hartshorne, when explaining their decision to uphold the award of double costs. His refusal to increase his child support payments over a 5-year period, from 1999 to 2004, in proportion to his income increasing, was seen as a strike against him. It was the children who bore the burden of his refusal to meet his financial obligation. Even by this time, the court had become very sensitive to a child’s entitlement to child support.

Case Details

This case originated from a very litigious couple going through a divorce proceeding. The couple had cases in both BC courts and the Supreme Court of Canada. Specifically, it is related to costs of trial and how they can be awarded.

Family law — Practice — Orders — Costs — Matrimonial proceedings

Outcome

The court upheld the award for double costs against Mr. Hartshorne, as a measure to punish him for refusing a reasonable settlement offer and, instead, wasting time and judicial resources on a 10-day trial.

Key Takeaways

• Although Mr. Hartshorne was paying child support in response to a court order, his increased income should have increased his payments. In not doing so, he created an unfulfilled obligation that could be held against him later.
• Double costs are a measure the court can and will use to punish a litigant who sees through a weak case or one that should have been settled at some point in the process.
• It is in a party’s best interest to make their settlement offer reasonable if providing one so that at the time of costs, the trial judge can determine if the offer should have been accepted prior to trial.

References

Hartshorne v Hartshorne, 2011 BCCA 29 (CanLII)
https://canlii.ca/t/2fh7z

1. Supreme Court Civil Rules, BC Reg 168/2009, s 9-1(6)
   https://canlii.ca/t/563zm ↩︎

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