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Posts from the ‘Appeals’ Category

Busted! Court Relies on Sworn Financial Statements from First Divorce to Value Assets During Second One

Busted! Court Relies on Sworn Financial Statements from First Divorce to Value Assets During Second One

The husband was a 46-year-old, recently-separated businessman who met the 26-year-old wife when she was a junior at the law firm he used for his business matters and litigation. After they moved in together and he got a divorce from his first marriage, the wife left her job at the law firm to take care of the husband’s litigation and related corporate affairs.

They were married for 14 years before they separated, and had three children.

When they split up, the husband forwarded a newly-prepared separation agreement for the wife’s signature. She signed without obtaining independent legal representation.  She was comfortable doing so because she believed that the husband had provided full disclosure, and she trusted his assessment since he had considerable experience valuing businesses.

Using the business valuation information provided by the husband, the separation agreement would have called for the wife to pay the husband just under $1 million as an equalization payment; however, it also provided that the husband would agree to forgo her having to pay that amount.

Sounds like a good deal, right?

However, the wife slowly realized afterwards that the husband had misled her. Rather than her owe him money in equalization (which he waived), the proper calculation was entirely different because he had greatly overstated the value of the corporate assets that he brought into the relationship, most notably the value of his company at the date of marriage. This would inflate the amount she was adjudged to owe him way of an equalization.

She successfully applied to the court to set aside the separation agreement, on the basis that the husband had not given full financial disclosure.  The trial judge adjusted the calculation accordingly.

The husband appealed.  In support of his business valuation figures, he put forth the evidence of an expert, who attested to the fact that the value of the business on the marriage date was over $7 million.  However, the Appeal Court concluded that the expert was partial to the husband and lacked independence, and had given an inflated figure that could not be trusted.

Instead, the court relied on some “smoking gun” evidence:  the sworn financial statements the husband had filed in his first divorce, which showed that he had essentially brought no assets of value into this second marriage to the wife.  The trial judge had relied on this evidence as well in setting the separation agreement aside, and the Appeal Court confirmed that there was nothing improper about the trial judge having done so, even if it was to the husband’s detriment.

In the end, the husband was found to have intentionally misrepresented the value of his corporate assets, by claiming that they were worth $6 million more than their actual (court-determined) value.

The Appeal Court upheld the trial judge’s decision to set aside the separation agreement, and went on to calculate the proper equalization amounts using the true valuation of the husband’s assets.

For the full text of the decision, see:

       Virc v. Blair

At Russell Alexander Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders.  For more information, visit us at RussellAlexander.com

Even Judges Get it Wrong Sometimes

Even Judges Get it Wrong Sometimes

A few weeks ago, I wrote about a case called Butty v. Butty. This was a decision by Justice Pazaratz in which he considered how the parties’ separation agreement, which was intended to exempt the husband’s farm property from the normal property-equalization regime, should be interpreted after it came to light that the husband owned two separate parcels of land, rather than one as originally thought.

At trial, Justice Pazaratz had declared the separation agreement invalid, and set it aside for what he concluded was the husband’s failure – and the failure of his lawyer – to disclose the existence of the two properties. The husband’s property was then divided in keeping with the usual Family Law Act rules, notwithstanding what the parties’ separation agreement may have intended.

The husband appealed, successfully. The Court of Appeal disagreed with Justice Pazaratz’s assessment of the facts as to the alleged lack of disclosure, and reversed his ruling. For one thing, it found that the judge had been highly critical of the husband’s trial lawyer, Mr. Jaskot, accusing him of suppressing facts and deliberately misleading the court and opposing counsel. The Appeal Court found these accusations unwarranted, writing:

As we have mentioned, the trial judge believed that Mr. Jaskot tried to hide the fact that there were two separate properties. In his reasons for decision, he describes Mr. Jaskot as having purposely suppressed information in an attempt to mislead opposing counsel and the court into believing that the farm property was a single parcel of land.

In light of the foregoing evidence, this characterization of Mr. Jaskot is completely unfounded. Opposing counsel and the court had documents clearly showing that the farm property consisted of two separate properties.

As a result of the reasons for judgment, Mr. Jaskot has suffered unwarranted personal and professional embarrassment.

And rather than lay blame on the husband’s lawyer for hiding the information, the Appeal Court found that the parties actually shared in the mistaken initial belief that the there was only one piece of property at stake.   After noting that Justice Pazaratz could have easily remedied the procedural fallout from the parties’ mutual misapprehension at the trial itself, the Appeal Court said:

This court cannot truly repair the damage that Mr. Jaskot has suffered. Having said that, its comments are intended to serve as an unequivocal statement that there was nothing improper in his conduct in this matter. We regret what appears, on this record, to be unwarranted judicial criticism levied against him.

Next, the Appeal Court found that the parties’ mutual misapprehension did not detract from a key fact: The wife was aware that the separation agreement was designed to circumvent the normal property-division scheme under the Family Law Act, and that she was giving up all her claims to the entire tract of property, whether consisting of one lot or two. The Appeal Court also observed that the wife had not been under duress when she signed the agreement, and had received independent legal advice (which she did not heed) before doing so.

Based on this and other errors by Justice Pazaratz, the Appeal Court restored the parties’ separation agreement, and proceeded to divide their property in accord with its express terms.

For the full text of the decision, see:

Butty v. Butty, 2009 ONCA 852 (CanLII)

At Russell Alexander Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

 

Two Properties, or One? Justice Pazaratz Sorts It Out – For Now

Two Properties, or One? Justice Pazaratz Sorts It Out – For Now

Here’s another noteworthy ruling by Justice Pazaratz – and one that was ultimately reversed on later appeal. Written in his inimitable style, the judgment begins this way:

You wouldn’t think the singular or plural should be so complicated.

Property.

Properties.

The same word. Add an “s”.

You really wouldn’t think that in a nine day trial, involving four presenting counsel — and three more lawyers as witnesses — they couldn’t keep it straight.

Or, that the court wouldn’t find out until the end of the seventh day of evidence – from the very last witness — that all the time we were talking about “property”, we really should have been talking about “properties”.

The Applicant’s lawyer — apparently the only one who knew all along about the mistake — says whether it’s “one property or two” really doesn’t matter.

I’m not so sure he’s right. Or that what he did was right.

This is a story about two houses; 151 acres; a benevolent matriarch; a pregnant bride; and a marriage contract apparently suffering from too many “cut and pastes”. More importantly, it’s a story about two children, still trapped under the same roof with a mother and father who can’t agree on either the past or the future.

With that prologue delivered, Justice Pazaratz went on to examine the merits of the former couple’s dispute, which (at least on the property side of things) related to a 151-acre piece of land that the husband owned at the date of the marriage. The matrimonial home was one of two houses on the property, the other being the husband’s mother’s home.

In 1996, the spouses had signed a marriage contract providing that in the event that they separated, the husband was entitled to exclude the assets that he owned at the time of the marriage. Neither spouse (nor their lawyers) knew at the time that the 151 acres were actually two separate properties, rather than one, and that the husband owned them both.

When the true state of affairs came to after the parties’ separation light years later, the wife claimed that the husband’s non-disclosure about owning both properties invalidated the marriage contract that they had purportedly reached.

Justice Pazaratz agreed with the wife, and held that the marriage contract should be set aside due to the material misrepresentation. At the time the contract was drafted and signed, the wife and her lawyer were misled that there was only one property. This omission rendered the contract inadequate to satisfy the disclosure requirements of the Family Law Act since it undermined the factual basis of the parties’ ostensible deal, and left the wife unable to accurately assess her rights and options.

After setting the marriage contract aside, Justice Pazaratz proceeded to divide the parties’ assets through the normal equalization process. (That ruling was later reversed by the Court of Appeal, which included comment on a “serious matter arising from the reasons for judgment given by the trial judge.” The later appeal ruling will be the subject of an upcoming Blog].

For the full text of the decisions, see:

Butty v. Butty, 2008 CanLII 23946 (ON SC)

Appeal level:

Butty v. Butty, 2009 ONCA 852 (CanLII)

At Russell Alexander Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Spousal Support Advisory Guidelines – Are They a Package Deal?

Spousal Support Advisory Guidelines – Are They a Package Deal?

In a decision called Mason v. Mason, the Ontario Court of Appeal considered a narrow legal question: Is a judge entitled to use the Spousal Support Advisory (SSAGs) for partial purposes, but disregard it for others? And if the judge departs from using the SSAGs, must he or she give specific reasons for doing so?

The Masons were a husband and wife who had decided to divorce after a marriage spanning almost 20 years. During their relationship they had worked together to build a successful business, and after separating were able to settle all issues except the amount of spousal support that the husband should pay the wife in the circumstances. They went to court to have a trial judge determine that amount for them.

In his reasons, he had made a finding that the husband’s annual income was about $400,000, including certain corporate income that came from the husband buying out the wife from the business. He determined the wife’s income to be about $82,500.  After consulting the SSAGs to determine the proper range of support, he ordered the husband to pay about $9,000 per month.

The former spouses appealed, each claiming that the trial judge had incorrectly approached the income determinations, and had mis-used the SSAGs in doing so. They took issue with the income that had been attributed to them and with the resulting amount of the support award.

As many of you will know, for Canadian judges who are asked to determine spousal support upon the dissolution of marital relationship, the SSAGs set out a pre-determined – but non-mandatory – set of calculations.   As the name suggests, they are “advisory” in nature.

But in this case the Appeal Court found that the trial judge had used them incorrectly:   In the process of reviewing and setting the parties’ respective income, he had used the SSAGs to set the range of appropriate support, but then had abandoned using them when it came time to make the actual income determination.   The Appeal Court said:

As the trial judge was using the SSAGs to determine the amount of spousal support, it was incumbent on him to either rely on the Guideline provisions for determining income — or to explain why they should not apply.

It’s a thinly-sliced distinction, but means that despite being an advisory guide, once the trial judge had referred to the SSAGs in determining the spousal support range, he was required to at least explain why he considered them inapplicable in the Masons’ case.

With that said, the Appeal Court reiterated that the SSAGs “cannot be used as a software tool or formula” whereby the judge merely plugs in the income figures, obtains a range, and chooses the midpoint. They must be “considered in context and applied in their entirety”. The Appeal Court also pointed out that the trial judge had given too few reasons on how the specifics of the various dollar-amounts were calculated.

In the end, having identified errors in the trial judge’s income calculations for both parties, the Appeal Court declined to send the matter back to trial, and opted instead to make the income adjustments itself. It adjusted the husband’s income downward by about $200,000, and the wife’s upward by about $20,000. The spousal support component, payable by the husband to the wife, was adjusted to $1,500 per month.

For the full text of the decision, see

Mason v. Mason, 132 O.R. (3d) 641, 2016 ONCA 725 (CanLII)

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Access to Children by Grandparents: Does a Parent Have Automatic Veto Power?

Access to Children by Grandparents: Does a Parent Have Automatic Veto Power?

Although the case of Simmons v Simmons is actually from Nova Scotia, it’s an interesting and universally-applicable illustration of how Canadian courts can approach an access contest between parents and various other family members – in this case, the grandparents – and how even a parent’s own wishes can be thwarted in appropriate cases.

The father had died of cancer when the boy was only 15 months old. The paternal grandparents had visited the boy often, both prior and immediately after their own son’s death. But when the boy was almost three years old, tension and acrimony developed with the boy’s mother over the frequency of their visits. Although the grandparents were being denied access per se, the mother was not prepared to be particularly cooperative with them until they offered an apology for what she considered was their past ill treatment.

The discord resulted in the grandparents discontinuing their visits to the boy for several months.   Over the objections of the mother, they then succeeded in obtaining a court order granting them interim access to the boy. (And note: Such applications by grandparents are permissible in all Canadian jurisdictions). The application judge had concluded that the boy’s best interests were fostered by nurturing the relationship between him and his grandparents, and ordered that such access should increase gradually over a four-month period, culminating in day-long visits every second weekend.

The mother appealed that order based primarily on the argument that, on the narrow issue of who should access to her son, the prior judge had not given proper deference to her own decision-making authority as his mother.

The Appeal Court rejected that argument, and dismissed the mother’s appeal.

Contrary to the mother’s claim, the judge that made the initial order did not fail to accord proper deference to the mother’s decision-making authority respecting access. He did take it into account; what he didn’t do was let it override consideration of the boy’s best interests.

Although it was a general principle that parents should have autonomy over decision-making relating to their children, this paradigm was not the only acceptable approach to making a determination on the grandparents’ access rights in this case. Rather, the overarching test was merely whether granting such access was in the boy’s best interests.

In this case, judicial deference to the mother’s authority, as a parent, had to be tempered by the court’s willingness to recognize the benefit giving the boy exposure to his extended family, particularly since he had already lost his father.   The previous judge had thoroughly weighed this consideration, along with all the evidence both in favour and against an access award. There was also nothing to suggest that the judge made the order as a way of fostering hope or speculation that the grandparents’ access would resolve the tension between them and the mother.

For the full text of the decision, see:

Simmons v Simmons, 2016 NSCA 86; [2016] N.S.J. No. 494 (C.A.)

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Appeal Court Affirms No Claim for Emotional Harm Arising from Birth of Unwanted Child

Appeal Court Affirms No Claim for Emotional Harm Arising from Birth of Unwanted Child

An unusual case arising from a man’s lawsuit over a baby he didn’t want has now been heard by the Ontario Court of Appeal.

As I reported here, the facts involved a man and woman who had a brief romantic fling in 2014, lasting less than two months. After going on a few dates, they had unprotected sex on several occasions. Although it was not strictly proven before the court, the man recalled his understanding, from various things the woman said, that she was taking birth control pills and did not intend to conceive a child.

But a few weeks after their short relationship ended, the man, in his early 40s, found out that the woman, in her early 30s, was pregnant. She went on to give birth, at which time it was confirmed that the man was the father.

The man, who was a budding doctor, sued the woman in civil court for over $4 million, claiming her fraudulent misrepresentation had deprived him of the choice of when and with whom to share the responsibility of parenthood. The court framed his cause of action in these words:

Although it was not presented in this way, the claim can be viewed as a tort claim for involuntary parenthood made by one parent against the other. It is clear that the alleged damages do not relate to a physical or recognized psychiatric illness. In essence, the damages consist of the [man’s] emotional upset, broken dreams, possible disruption to his lifestyle and career, and a potential reduction in future earnings, all of which are said to flow from the birth of a child he did not want. Although the claim is not for the direct costs associated with raising the child, all of the damages claimed by the [man] are the result of consequences flowing from the unwanted birth of a child, albeit unwanted only by the father.

(And it’s important to note that the man was suing for emotional harm of the non-pathological variety only; he was not suing for physical harm or for monetary damages, such as for any undesired child support obligations he may have. On that latter point, a separate Family Law suit, disputing his obligation to pay child support based on the woman’s alleged fraud and deceit, was also underway and would be heard separately).

The lower court, in striking out the man’s claim, held that his allegations disclosed no reasonable, legally-recognized cause of action, because a claim for fraudulent misrepresentation – which is a tort in Canadian law – was aimed at compensating the man for any financial damages, not emotional ones. In other words, the man was trying to claim for the types of damages that were simply not actionable through a fraud claim.

In its recent decision, the Ontario Court of Appeal agreed, adding that the woman’s alleged lie as to her being on birth control – even if it was proved that she told it – was not enough to form the basis of the man’s claim for emotional injury. Plus, any harm the man suffered was not tantamount to a “personal injury” in the traditional legal sense.

Do you think the original decision – now affirmed on appeal – was correctly decided? What are your thoughts?

For the full text of the decision, see:

PP v DD, 2017 ONCA 180 (CanLII)

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

 

 

 

Vexatious Litigant Won’t Take “No” for An Answer

Vexatious Litigant Won’t Take “No” for An Answer

Sometimes you hear about Family litigants for whom their dispute against the former spouse has taken on a life of its own, and who will not stop until they have literally exhausted every possible legal and procedural avenue.   The case of Nassr v. Vermette seems to be a great illustration of this scenario.

The former couple had commenced their family litigation in 2009, after which time the husband brought numerous questionable and downright meritless applications and motions. In 2011, pursuant to an order of the court, he was declared a “vexatious litigant” – which means that he was prohibited from commencing or continuing any further proceedings.

About four years later the husband decided he wanted to have that “vexatious litigant” designation set aside. But the court flatly rejected his application, and made an order that declared the designation anew. For greater certainty, the wording made it abundantly clear that he was expressly prohibited from instituting any new legal proceedings, and was prevented from continuing any proceeding previously instituted by him, unless he obtained the court’s permission.

Yet the husband tried to launch another appeal, and duly asked the court for permission to proceed. Although the court granted him an audience, it found that he simply did not meet the test for being allowed to proceed, under s. 140 of the Ontario Courts of Justice Act, and found there was no merit to his appeal anyway. Section 140 deems the court’s decision to be final, so the husband was blocked from appealing the court’s refusal of his application for leave.

In other words, the husband’s road was formally at an end. Or so only it seemed.

The husband tried to appeal yet again, this time focusing on an earlier judgment that had been made dealing with custody, access, and child support. The wife brought a motion to have that appeal attempt dismissed, and she was successful.

In making its ruling, the court emphasized that since the husband had been declared a vexatious litigant, this meant he had no further right to appeal or take any other step. That designation had been validly made by an earlier court, and – under section 140 of the Courts of Justice Act – could not be appealed.

The court also rejected the husband’s last-ditch argument, to the effect that the Rules of Civil Procedure should be bent for him.   Under one of its provisions, the court was entitled at any time to decide that compliance with a rule could be dispensed with. The husband claimed he should be given the benefit of the doubt so that his appeal could go forward notwithstanding the prohibition in section 140 of the Act.

The court didn’t buy it. The provision the husband had in mind applied only to the Rules, not to the test for obtaining leave in section 140 of the Courts of Justice Act, which is entirely different legislation. The court went ahead and quashed the husband’s appeal.

Not to be deterred, the husband didn’t stop there: He applied for leave to appeal from that Appeal Court decision as well. That application was made to the Supreme Court of Canada, but it was dismissed with costs.

Game over.

For the full text of the decisions, see:

Vermette v. Nassr, 2016 ONCA 658 (CanLII)

Jason Donald Nassr v. Laurie Ann Vermette, 2017 CanLII 5363 (SCC)

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Delays, Extensions, Adjournments and Excuses – How Not to Conduct Your Family Litigation

Delays, Extensions, Adjournments and Excuses – How Not to Conduct Your Family Litigation

A few weeks ago, I reported on a case called Schwilgin v. Szivy. I recounted the court’s stern response to a litigant – in this case, the husband – who had been obdurate in failing to comply with numerous prior court orders.

“Part 2” of this story reveals the court’s reaction to that same husband’s repeated delays in moving their divorce and custody issues along. Since the husband was self-represented, it all becomes a good lesson on “how not to conduct your own Family litigation”.

The couple had separated in 2002 and had two children.   Starting around 2010 they commenced what turned out to be rather lengthy legal process around custody and child support.

After a series of prior court decisions in the case, the husband wanted to appeal one particular order that related to (among other things) denying his requested variation of child support, and relieving him of the obligation to pay $75,000 he owed in child support arrears since 2006.

But what followed was a series of blunders and delays on the husband’s part. First, he filed his Notice of Appeal in the wrong court.   When the error was brought to his attention by opposing counsel, he went ahead anyway. But not only did the court refuse to hear him, it refused to transfer the matter to the proper court, and simply quashed the husband’s appeal outright.

By now, the husband was too late to file in the proper court venue.   He asked the court for an extension of the filing deadline claiming that, being a layperson, he simply made a procedural mistake in choosing the wrong court. The court didn’t buy it. The extension was turned down.

Having frittered away his right to appeal automatically, he now needed the court’s permission to take further steps toward an appeal.   But in yet another motion he failed to persuade the court that he had met the relevant test. More importantly, the court explained that the husband’s many poorly-justified delays in the past “weigh[ed] very heavily against” granting the time extension.

Which brings us to the latest ruling.

A full 13 months after the dismissal of his earlier motion for an extension, the husband brought yet another motion to have that order reviewed.

However, even though this was the 11th hour the husband was not cured of his shenanigans: After the hearing date was set, he contacted the court staff to ask for an adjournment. His reason? He was unable to find a lawyer, and unable “to defend himself due to illness” and a lack of funds.   This was contrary to earlier information stating that he had duty counsel lined up, which claim the court also found to be suspect.

The Appeal Court flatly turned down the husband’s latest request for an adjournment.   After reviewing his materials, it concluded that:

  • He had failed to provide current medical or other evidence in proper form to justify having the court grant the order;
  • He had not proven that he had legal aid lined up, as he claimed; and
  • There was no acceptable explanation for the husband’s 13-month delay in asking for a review.

Although he is quickly running out of legal options – and likely testing the courts’ collective patience – I suspect this will not be the husband’s “last kick at the can”.

For the full text of the decisions, see:

Schwilgin v. Szivy, 2017 ONCA 78 (CanLII)

The decision appealed from is:

Schwilgin v. Szivy, 2015 ONCA 816 (CanLII)

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Deceased’s Estate Division Pits Sister and Ex-Wife Against Each Other

Deceased’s Estate Division Pits Sister and Ex-Wife Against Each Other

Here’s a slightly convoluted tale, but it’s an interesting one involving a dispute between the estranged wife and sister of a deceased man over his estate. Here is the cast of players:

1) Paul, who died in 2013.

2) His wife Pauline, from whom he separated in 2002.

3) Paul’s sister Rita, to whom he left half his estate, and who was also his Estate Trustee.

When Paul and Pauline separated, Paul agreed under their separation agreement to designate Pauline as beneficiary of a $150,000 insurance policy and keep up the premium payments. If Paul failed to maintain the insurance, it was agreed that Pauline would have “first dibs” against his estate for $150,000, in the role of a creditor.

In fact, Paul did not maintain the life insurance as agreed, and it lapsed before he died.

But there was a problem: Paul’s estate was too small to pay Pauline the $150,000 he owed, since his assets at death totaled only about $100,000.

Enter Paul’s sister Rita. As a beneficiary under his Will – and but for Pauline’s $150,000 claim – she stood to inherit 50% of Paul’s estate. In the role of Estate Trustee, she had obligations to all estate creditors, including Pauline. These duties These duties included ascertaining the debts and liabilities of Paul’s estate, and paying them. So Rita essentially wore “two hats”.

Pauline’s asserted first-dibs claim against Paul’s estate became a contentious issue, and the matter went to court for resolution. In an earlier application, the court rejected Rita’s argument that Pauline had missed the deadline for bringing her claim against Paul’s estate, which she did in 2015, more than two years after Paul’s death.

On appeal, the Court of Appeal confirmed that finding. The reason for Pauline’s delay was actually Rita’s own obfuscating conduct, and it would be unfair to hold her to that deadline in the circumstances.

As Estate Trustee, Rita had control over the information Pauline needed to ascertain whether Paul held any insurance policy for her benefit, as the separation agreement required. Pauline could not obtain the information from the insurer directly, so she was understandably beholden to Rita to provide it. Only Rita knew whether Pauline’s debt claim against the estate even existed; this put her in a unique and privileged position.

The problem was, Rita was not forthright with Pauline, and withheld the information she needed.

Initially, she had her lawyer advise (inaccurately) that Paul had maintained the life insurance, and later had the lawyer advise that the policy “may have lapsed”. Neither of these statements were true: Rita had known early on that Paul had let the life insurance lapse despite his obligations under the separation agreement, knew Pauline had a valid claim against his estate as a creditor. Yet she kept the information from Pauline and caused her to delay taking timely steps in pursuit of it.

From a legal standpoint the Appeal Court found that – wholly unrelated to their family connection – Rita and Pauline had a “special relationship”, and that Rita’s withholding of information made her guilty of fraudulent concealment, and made her conduct “unconscionable”.

The Appeal Court referred to and endorsed the findings of the application judge, who had written:

By withholding material facts, the estate trustee [the sister, Rita] concealed from [Pauline, the wife] that she had a legitimate debt against the estate as a creditor. In my view, given the special relationship between the estate trustee [Rita] and [Pauline], it was unconscionable for the estate trustee [Rita] to initially suggest that insurance was in place, then delay matters by promising to bring an application for directions, and then later take the position (a position which provided a direct material benefit to her as a beneficiary of the estate), that the time for claiming against the estate had expired.

The court accordingly found that the usual deadline for Pauline to claim for $150,000 against Paul’s estate did not expire in this case, and could proceed.

For the full text of the decision, see:

Roulston v. McKenny, 2017 ONCA 9 (CanLII)

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Court to Delinquent Husband: If You Don’t Play By the Rules, You Don’t Get to Play

Court to Delinquent Husband: If You Don’t Play By the Rules, You Don’t Get to Play

A while ago I reported on one of several decisions in the ongoing litigation saga in Schwilgin v. Szivy, where the self-represented husband had made some procedural missteps in his divorce dispute with the wife. He had brought a series of appeals of judgments unfavourable to him, but was not always prompt in taking the necessary steps to do so.

At one point, he had missed the deadline for filing another appeal, and brought a motion to essentially ask the court for an extension.

The court had to consider whether, in light of the overall history of the matter and both parties’ conduct, the husband should be granted any leeway.

The main focus was on the fact that the man had not complied with numerous prior orders to pay costs: he owed the wife over $25,000 in connection with prior proceedings, yet he was coming before the court to ask for indulgences.

The court wrote:

Finally, I am not satisfied that the justice of the case supports granting the motion to extend. In quashing his appeal from the order of the motion judge, the Divisional Court ordered [the husband] to pay [the wife] costs of $10,000. He has not done so. In open court, [the husband] said he would not pay those costs because he contends he lacks the resources to pay them.

In her affidavit on the motion, [the wife] deposed that [the husband] owes her over $25,000 in costs from their matrimonial proceedings. In her letter of November 16, 2015 transmitting her responding materials to the court, [the wife] wrote:

I do not understand how [the husband] is permitted to constantly bring motions and appeals without paying the costs of previous court orders. It seems all the court does is order more costs, which I cannot collect. He gets stern words and a slap on the wrist (costs), and I get a bill from my lawyer. How is this fair?

That is a most legitimate question to ask. Courts usually talk in terms of prejudice which cannot be compensated for by costs. But, at some point, costs themselves become an inadequate form of compensation for prejudice, especially where the party on whom they are imposed refuses to pay them.

The Appeal Court also quoted from a prior order of the Divisional Court, where the court had said this about the husband:

The [husband] has used this appeal as a means of delaying paying the arrears in question and the costs ordered to the [wife]. Further, the [husband] has a history of using Court proceedings in this way. This has caused the [wife] considerable prejudice.

After noting the long history of the proceedings – plus the husband’s attempt to write to the court directly by letter, which was inappropriate – the Court of Appeal declined to grant him an extension, concluding that the “justice of the case” demanded it.

For the full text of the decision, see:

Schwilgin v. Szivy, 2015 ONCA 816 (CanLII)

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