Hartshorne v. Hartshorne,

• Jurisdiction: British Columbia
• Judge: Frankel, D. Smith and Groberman, JJ.A.
• Neutral Citation: 2011 BCCA 29
• Date: 28 January 2011
• Court: Court of Appeal (British Columbia)

Hartshorne v. Hartshorne (2011), 299 B.C.A.C. 6 (CA);

    508 W.A.C. 6

MLB headnote and full text

Temp. Cite: [2011] B.C.A.C. TBEd. FE.004

Robert Kenneth Hartshorne (appellant/respondent on cross-appeal/plaintiff) v. Kathleen Mary Mildred Hartshorne (respondent/appellant on cross-appeal/defendant)

(CA037220; 2011 BCCA 29)

Indexed As: Hartshorne v. Hartshorne

British Columbia Court of Appeal

Frankel, D. Smith and Groberman, JJ.A.

January 28, 2011.

Summary:

The 52 year old husband and the 46 year old wife separated in 1998 after 12.5 years' cohabitation, including nine years' marriage. They had two children. Both spouses were lawyers and were previously married. The wife practised law for six years until their first child was born. Thereafter she stayed home with the children. The husband, who brought $1.6 million in assets into the marriage, had the wife, who brought substantial debt and no assets into the marriage, sign a marriage contract. The wife's independent legal advisor advised against signing it, but also advised that the courts would set it aside on the grounds of unfairness. The contract provided that each spouse retain their own property, depriving the wife of any share of the husband's assets, except for three percent of the value of the marital home for each year of marriage and a provision for marital home contents and family vehicles. The contract did reserve the wife's entitlement to spousal and child support. The spouses sought a divorce. At issue was custody and access, the quantum of child support (including extraordinary expenses), spousal support and the enforceability of the contract, which the wife claimed was signed under duress and was unfair.

The British Columbia Supreme Court, in a decision reported at (2001), 22 B.C.T.C. 288, granted a divorce, awarded sole custody of the children to the wife and access to the husband, fixed child support and extraordinary expenses under the Federal Child Support Guidelines and awarded the wife $2,500/month spousal support (to be reduced to $1,500/month when the wife's income reached $2,000/month). The court held that the marriage contract was not unconscionable or entered into under duress, coercion or undue influence. However, the contract was "unfair" within the meaning of s. 65 of the Family Relations Act and the court reapportioned the marital assets more equitably. The court ordered an equal division of the marital home and its contents and a division of vacation property, RRSPs and savings at 60 percent in favour of the husband and 40 percent in favour of the wife. In reasons reported at [2001] B.C.T.C. Uned. 72, the Supreme Court conducted a valuation of assets. The husband appealed both decisions.

The British Columbia Court of Appeal, Thackray, J.A., dissenting in part, in a judgment reported (2002), 174 B.C.A.C. 129; 286 W.A.C. 129, dismissed the appeal. The husband appealed.

The Supreme Court of Canada, Deschamps, Binnie and LeBel, JJ., dissenting in part, in a judgment reported (2004), 318 N.R. 1; 194 B.C.A.C. 161; 327 W.A.C. 161, allowed the appeal. Enforcement of the contract was not unfair given the circumstances present at the time of distribution. Any economic disadvantage suffered by the wife could be compensated for by way of spousal support. The wife then applied for spousal support and increased retroactive and prospective child support.

The British Columbia Supreme Court, in a judgment reported [2009] B.C.T.C. Uned. 698, awarded the wife lump sum spousal support of $350,000 (retroactive to the February 2001 date that marital property was initially divided) and increased retroactive and prospective child support. The judge awarded the wife double costs on the basis of a settlement offer, given to the husband 12 days before trial, which should have been accepted. The husband appealed. The wife cross-appealed that she was entitled to only a 27% interest in the marital home, calculated on the basis of 3% per year times nine years of marriage.

The British Columbia Court of Appeal, in a judgment reported (2010), 289 B.C.A.C. 244; 489 W.A.C. 244, allowed the appeal in part. The lump sum award was affirmed. Although the trial judge was correct to find that the husband was disentitled to the negotiated 7% interest on the compensation award payable by the wife to the husband, he erred in failing to award post-judgment interest on the initial $265,318 compensation order. The court rescinded the award of prospective child support for the eldest son as of May 28, 2009, as the trial judge erred in finding that he continued to be a child of the marriage after that date. The court affirmed the double costs award. The wife's cross-appeal was dismissed. The husband applied to have the court reconsider its decision to affirm the double costs award. The husband argued that the effect of the monetary changes resulting from his appeal being allowed in part was that he recovered more than what the wife had offered.

The British Columbia Court of Appeal held that where judgment had yet to be entered, the court had jurisdiction to reopen or reconsider its appeal decision. The court dismissed the application and confirmed its affirmation of the double costs award.

Practice - Topic 7243

Costs - Party and party costs - Offers to settle - Effect of failure to accept - The trial judge awarded the wife double costs based on an unaccepted settlement offer made to the husband 12 days before the trial of the issues of spousal support and increased retroactive child support - The husband's compensation was increased on appeal, but the double costs award was affirmed - The husband applied for the Court of Appeal to reconsider its costs decision on the basis that the increased compensation on appeal resulted in him now recovering more than the wife offered to settle for - The British Columbia Court of Appeal reaffirmed its decision - First, the court was not satisfied that its decision resulted in the husband's judgment becoming more favourable than the unaccepted settlement offer - Further, the relationship between the settlement offer and the judgment awarded was just one of the factors to be considered (rule 37B(6)) - Other factors included whether the offer should reasonably have been accepted (not dependent on amount ultimately awarded at trial), the relative financial circumstances of the parties, and any other factor the court considered appropriate - The trial judge did not err in finding that the settlement offer, based on all of the factors, should reasonably have been accepted by the husband - That decision was entitled to deference - Another factor was the husband's blameworthy conduct by refusing to increase child support between 1999 and 2004 in the face of his known obligations under the Federal Child Support Guidelines - Other factors were that the offer was made 12 days before trial, that cost and inconvenience of a 10 day trial would have been avoided, that the offer provided sufficient information to permit the husband to understand its content, that accepting the offer would not require the husband to completely accept the wife's reasoning, and that acceptance would have terminated this long and protracted litigation - All factors considered, the double costs order should not be varied, even with the husband's increased compensation order.

Practice - Topic 7246

Costs - Party and party costs - Offers to settle - Whether judgment equal to or more favourable than offer - [See Practice - Topic 7243 ].

Practice - Topic 9136

Appeals - Hearing of appeal - Rehearing or reconsideration - When available - The British Columbia Court of Appeal held that where an appeal was heard on the merits and judgment was entered, the court had no jurisdiction to re-open or reconsider the appeal - However, it had inherent jurisdiction to re-open or reconsider an appeal where judgment had yet to be entered - See paragraphs 4 to 5.

Cases Noticed:

Chutter v. Chutter et al. (2009), 269 B.C.A.C. 206; 453 W.A.C. 206; 97 B.C.L.R.(4th) 32; 2009 BCCA 177, refd to. [para. 4].

Victoria (City) v. Adams et al. (2009), 280 B.C.A.C. 237; 474 W.A.C. 237; 2009 BCCA 563, refd to. [para. 22].

Hamilton v. Open Window Bakery Ltd. et al., [2004] 1 S.C.R. 303; 316 N.R. 265; 184 O.A.C. 209; 2004 SCC 9, refd to. [para. 23].

Giles et al. v. Westminster Savings Credit Union et al. (2010), 287 B.C.A.C. 281; 485 W.A.C. 281; 2010 BCCA 282, refd to. [para. 23].

A.E. v. D.W.J., [2008] B.C.T.C. Uned. 937; 91 B.C.L.R.(4th) 372; 2009 BCSC 505, refd to. [para. 25].

Mackenzie v. Brooks et al. (1999), 130 B.C.A.C. 95; 211 W.A.C. 95; 1999 BCCA 623, refd to. [para. 25].

Skidmore et al. v. Blackmore (1995), 55 B.C.A.C. 191; 90 W.A.C. 191; 2 B.C.L.R.(3d) 201 (C.A.), refd to. [para. 25].

Radke v. Parry, [2008] B.C.T.C. Uned. C62; 2008 BCSC 1397, refd to. [para. 25].

Bailey v. Jang, [2008] B.C.T.C. Uned. C42; 90 B.C.L.R.(4th) 125; 2008 BCSC 1372, refd to. [para. 27].

D.B.S. v. S.R.G., [2006] 2 S.C.R. 231; 351 N.R. 201; 391 A.R. 297; 377 W.A.C. 297; 2006 SCC 37, refd to. [para. 35].

Greene v. Greene (2010), 298 B.C.A.C. 114; 505 W.A.C. 114; 2010 BCCA 595, refd to. [para. 38].

Statutes Noticed:

Rules of Court (B.C.), Supreme Court Rules, rule 37B(6) [para. 26].

Counsel:

M.R. Ellis, Q.C., for the appellant;

S.N. Mansfield, for the respondent.

This application was heard by way of written submissions received on September 24 and October 8 and 14, 2010, before Frankel, D. Smith and Groberman, JJ.A., of the British Columbia Court of Appeal.

On January 28, 2011, the following supplementary reasons were delivered by the Court.