Can You Enforce an Offer to Settle That Does Not Meet the Formal Requirements?

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An offer to settle may be made by one party in a family litigation case to resolve some issues in dispute. Offers can be made throughout the court process, and the Family Law Rules outlines what is required to make a valid offer. Ontario’s family law system encourages parties to resolve issues, so there may be cost consequences if a party turns down an offer and then obtains a less successful result in court. But what if a party’s offer does not comply with the Family Law Rules? Can it still be accepted? 

Court Finds Compliance with Rules is Required

In Riss v. Greenough, two offers to settle were made on the father’s behalf. The first offer was prepared but not signed by the father’s counsel, however it was signed by the father. Rule 18(4) of the Family Law Rules states that “an offer shall be signed personally by the party making it and also by the party’s lawyer, if any”. According to the judge, this was a straightforward requirement and was also mandatory. On this basis the lack of a signature by the father’s counsel was enough to invalidate the offer. Moreover, the offer provided that the parties would “arrange a schedule” for the time that the child would spend with each parent. This provision was also too vague to be enforced, meaning it was not an offer under the Family Law Rules. There were also problems with the second offer, which was served on the opposing party the day before the motion was heard. However, under Rule 14 the offer was late being served and the judge did not take it into consideration. 

Balancing Compliance with a Need to Deal with Cases Justly 

In Gogas v. Gogas the court reached a different conclusion regarding the mandatory nature of the Rules. In this case the applicant made two offers to settle. The first was not signed by counsel as was required by Rule 18(4). The respondent argued that because of this the offer did not meet the formal requirements to be considered a valid offer, citing the decision in Riss in support of that argument. The judge accepted that the decision in Riss arose from “a strict interpretation” of Rule 18(4) which required that offers be personally signed by the party making the offer and their lawyer. However, Justice Healey looked to 2.01(1)(a) of the Rules of Civil Procedure which states that a failure to comply with those rules is an irregularity but does not render a proceeding or document a nullity and that the court can grant relief “on such terms as are just, to secure the just determination of the real matters in dispute”. As Justice Healey noted, the same language is not found in the Family Law Rules, which provides instead that courts are to deal justly with cases. And dealing with a case justly requires ensuring that the procedure is fair to all parties. This was interpreted to mean that courts should not require strict compliance with rules if doing so meant that a case would be dealt with unjustly.  

The judge speculated that the requirement to have a lawyer’s signature included was to ensure that the terms of an offer “had received the scrutiny and advice of legal counsel before being extended to the opposing party in order to lessen the likelihood of the offer being ambiguously drafted, reneged or set aside”. But in this case the offer was delivered to the opposing party through the lawyer’s office representing the offering party, so there was little doubt that the lawyer had offered advice into the creation of the offer prior to delivery to the other party. In that scenario the signature of the lawyer added nothing.  The applicant’s second offer was signed by his lawyer. The judge determined that it would be unjust to treat the validity of the offers differently based solely on the absence of a signature. Accepting the respondent’s argument would result in injustice to the applicant because of a “technicality”. And the judge believed that the court’s duty could be met by accepting the initial offer as a valid offer.  

Court Permits Offer to be Accepted Where Party Fails to Sign

In Dunn v. Shaw the applicant sought an award of costs based in part on her success at trial and offers to settle. The respondent argued that there should be no award of costs. The offer to settle was signed by the applicant’s counsel but did not contain her signature. The applicant suggested that in determining costs significant weight should be given to her offer. However, the respondent alleged that the offer could not be considered as it did not comply with the Rules and also because it was impossible for him to agree to the terms as the applicant did not provide her financial disclosure. The court found that the offer did contain an irregularity as in Riss, but possibly even more so because here the offer was not signed by the party. This meant that it was not a valid offer and could not be considered an offer at all because the terms were not capable of enforcement. The applicant had offered child support determined pursuant to the Child Support Guidelines, but in the court’s view this offered nothing at all, since the Family Law Act already directed that child support be calculated in accordance with the Guidelines. Moreover, the lack of timely disclosure from the applicant also precluded any acceptance of the offer. 

More recently, McNeil v. McNeil revisited the issue of non-compliance with the Rules concerning offers to settle. In this case the respondent accepted an offer, however the applicant now argued it was not an offer at all pursuant to the Family Law Act, as he had not signed it personally. He pointed to the decision in Riss which suggested this was a straightforward, mandatory requirement. However, the court preferred the interpretation of Rule 18(4) in Gogas. In both of those cases the offers lacked the signature of the lawyer. But in this case the offer had counsel’s signature twice but was missing the applicant’s signature. But with two signatures on the document, it appeared to be in compliance with the Rules and capable of acceptance. Further, the applicant confirmed that he authorized the offer, there was just no explanation for why his counsel signed it twice. Trying to rely on his failure to personally sign now was “contrary to common sense and the intent of the Family Law Rules”. Moreover, in addition to the valid acceptance, the judge found there had already been partial compliance with the offer. 

Carefully Evaluate an Offer to Settle 

The Family Law Rules set out what is required for a party to make an offer to settle. These requirements may appear straightforward, but courts have differed in their interpretation of them. Where an offer does not contain the required elements, it may not be a valid offer, though some courts have not required strict compliance in an effort to deal with cases justly. Parties should carefully consider offers they make and recognize they may be accepted. 

Windsor Family Lawyers Assisting You With Your Family Law Issues

The lawyers at Howie Johnson Barristers and Solicitors in Windsor focus exclusively on family law matters. We can provide you with valuable information tailored to your unique situation so that you know what to expect and can understand your rights and obligations. To discuss your matter further or arrange a consultation please contact the firm at 519-973-1500.

 

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