An offer to settle can be made to the opposing party in a family law dispute to settle all or an aspect of the case. The Family Law Act sets out the requirements of a formal offer to settle and the implications of same.
A party is always better off by making a fair and reasonable offer to settle their family law matter. There are several reasons why you should carefully consider making an offer to settle. Courts look favorably on parties who try to settle their disputes. In addition, if certain requirements are met, an offer to settle may allow recovery of majority of a litigants legal fees.
Family law courts can award costs to the party that makes a fair and reasonable offer to settle. The risk of having an adverse cost award made against a party is a good motivator for parties to settle. This also serves to penalize those parties that reject a reasonable offer to settle.
The court has wide discretion when it comes to assigning costs. Under the rules, the judge will take into account an offers to settle when determining costs. However, not all offers to settle will carry the same weight or ensure maximum recovery. To maximize recovery, the judge will consider whether the offer to settle is in full compliance with rules. In a nutshell, these rules relate to how early the offer to settle is made, its withdrawal, expiry, whether it was accepted, and whether the party who made the offer gets an order as, or more, favorable than the offer.
An offer to settle does not necessarily have to make an offer to settle the entire litigation all at once. It can also focus on specific claims. Therefore, a party can make an offer to settle property division but can leave claims for spousal support up to the court. Further, offers to settle are not limited to just financial claims. They can be used for any claims or issues including custody of children. If the accepted offer does not deal with costs, either party is still entitled to ask the court for costs.
Usually, an offer to settle can be made by either party at any time before or even during the litigation. Some parties prefer to include a time limit in their offer. That is the offer will remain open until a certain deadline, and once the deadline passes the offer is automatically withdrawn. The offer to settle can be withdrawn at anytime by the offering party by serving a written notice of withdrawal as long as the offer has not been accepted.
To accept an offer, the receiving party must serve an acceptance on the party who made the offer. The party handed an offer does not have to accept the entirety of the offer, but can freely choose to accept parts of the offer and reject other parts of the offer. The party must serve the acceptance before the offer is withdrawn or before the court starts to dispose of the claim the offer to settle is about. An offer cannot be accepted after the judge renders his/her judgment.
Before the offer is accepted, the terms of the offer must be kept confidential from the judge presiding over the trial or the motion that is the subject of the offer, until the judge has ruled with all the issues that are in the offer not including costs. Typically a judge determines costs at the end of each stage of the litigation. Therefore, the offer cannot be mentioned in any document filed in the continuing record, an affidavit or even mentioned to the judge until the judge has ruled on the issues and judge is ready to determine costs. An offer to settle that is part of a settlement conference brief will not be considered when determining whether costs should be awarded.
If a party does not abide by all of the terms of the accepted offer, the other party can ask the court to order the non-conforming party to act within accordance of the settlement. Alternatively, the other party can continue with the case as if the offer had never been accepted.
For more information about how an Offer to Settle in Family Law works, or about obtaining a divorce in Ontario, please contact our Toronto divorce lawyer.
NOTICE AND DISCLAIMER: The material posted on this website is for informational purposes only and should not be relied upon as legal advice. If you are in need of legal advice relating to your particular situation it is highly recommended to consult with a lawyer.
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