COURT OF APPEAL FOR ONTARIO
DATE: 2001-07-03 DOCKET: C36534 M27516
RE: GAIL LINDA MANIS (Petitioner) – and – WARREN IAN MANIS (Appellant)
BEFORE: SIMMONS J.A. (IN CHAMBERS)
COUNSEL: Peter B. Cozzi for the appellant Avra Rosen for the respondent
HEARD: June 28, 2001
E N D O R S E M E N T
1Mr. Manis requests an order pursuant to Rule 63.02(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, staying enforcement of a warrant of committal. The warrant was signed on June 28, 2001 pursuant to an order of O’Connell J. made June 13, 2001. Mr. Manis has delivered a notice of appeal of the June 13, 2001 decision.
2The formal order made on June 13, 2001 is not in the material before me1. In his Reasons for that decision, O’Connell J. stated the following:
… I am satisfied beyond a reasonable doubt that Mr. Manis has failed to comply with Justice Lane’s judgment in that he failed to provide the alternate security for the mortgage and the line of credit. …
Accordingly, having found that he’s in contempt, I’m committing him to jail for a period of six months. The warrant will issue fifteen days from the date of this order, that is on June the 28th, 2001, unless he purges his contempt. He may purge his contempt by removing the mortgage registered against 313 Hillhurst Boulevard, Toronto (former matrimonial home), and remove Ms. Manis’ name from the line of credit with the Royal Bank of Canada.
3The judgment of Lane J. dated November 30, 2000 followed a four-week trial under the Family Law Act, R.S.O. 1990, c. F.3. Among its terms are paragraphs 8 and 9 which provide as follows:
THIS COURT ORDERS AND ADJUDGES that the Respondent (Husband) shall take all steps as are necessary to remove and discharge in full the mortgage currently registered against the matrimonial home, being premises municipally known as 313 Hillhurst Boulevard, Toronto, Ontario in favour of the Royal Bank, by attending upon the mortgagee and company with a representative of the Petitioner (Wife), within the next two weeks, to make arrangements for substitute security for it.
THIS COURT ORDERS AND ADJUDGES that the Respondent (Husband) shall further attend upon the Royal Bank, within the next two weeks, to make arrangements for substitute security for the joint line of credit in which the Petitioner (Wife) is jointly liable, as this debt is a debt of the Respondent (Husband).
4Mr. Manis submits there is a serious question to be determined on appeal concerning whether O’Connell J. erred in law both in making the finding of contempt and in imposing a penalty of imprisonment for any contempt that was properly found. He therefore requests that enforcement of the warrant of committal be stayed pending the determination of the issues on appeal.
Background
5In his Judgment dated November 30, 2000 Lane J. also ordered Mr. Manis to pay Ms. Manis an equalization payment of $415,486, child support of $2,333 per month from May 1, 1997 (subject to credit for payments already made), and spousal support of $4,750 per month2 from February 14, 1997 (subject to credit for payments already made). He restrained Mr. Manis from depleting his assets until the equalization payment is paid and the mortgage is removed. He specifically noted in his Reasons that it had been conceded that the mortgage on the matrimonial home is a debt of Mr. Manis secured on Ms. Manis’ home.
6The findings of Lane J. in his Reasons also included the following:
Counsel for Mrs. Manis attacked Mr. Manis’ credibility on several fronts. On the whole, this attack succeeded and I have grave doubts about his testimony. Part of the $5,000 arrears noted above arose from his taking the insupportable position that he did not have to pay medical bills without being given the original bill when the Order expressly stated he was to pay upon receipt of copies. He unreasonably delayed production and answering undertakings for years in what can only have been a deliberate effort to prevent Mrs. Manis from obtaining adequate and timely information. He failed to disclose his off-shore holdings in British West Indies Securities, and when some information about them came to light, he refused to produce any documents concerning them, while insisting that they were other people’s money which he held in trust. To this day not one brokerage statement or other record of these funds has been produced by him. He admits to owning two offshore companies … but has produced no records of their financial dealing. The rare documents we have are copies made by Mrs. Manis of papers she found in his office in the matrimonial home. One of those documents reveals that he was sending money overseas and it was being deposited in small amounts because of the strictness of the laws against money laundering. No explanation, no Bank statement, nothing, was produced regarding this document or the account. Mr. Manis’ Financial Statement shows spending at the rate of some $286,000 annually, yet he swore at the trial he had no income. On cross-examination, his explanation that he was living off capital was challenged and he was unable to show any withdrawals from his capital, never mind ones sufficient to begin to account for his standard of living. The inference that he has undisclosed income and assets is irresistible, and I draw it. In the witness box, Mr. Manis was argumentative, often evasive and missed few chances to take a shot at his wife on issue unrelated to the question. He was more anxious to score points than get the facts out … It is clear that he was not prepared to admit or disclose anything that Mrs. Manis did not already know about. He was not a candid or reliable witness.
7Following delivery of the decision of Lane J., counsel for Ms. Manis wrote to counsel for Mr. Manis on December 15, 2000 inquiring when arrangements could be made to meet at the Royal Bank to make arrangements for removal of the mortgage and release of Ms. Manis from liability on the guarantee. No arrangements were made. Subsequent inquires were made by letters sent on January 18, 2001 and February 16, 2001. Counsel for Mr. Manis responded that Mr. Manis was seeking to set aside the entire judgment of Lane J. on appeal and was unwilling to implement any terms of the letter of February 16, 2001 “in isolation of an agreement to resolve all issues…”.
8Mr. Manis filed a notice of appeal of the judgment of Lane J. on December 28, 2000, however he did not perfect his appeal or apply for a stay of the judgment. The appeal was ultimately dismissed for delay on May 18, 2001, after Mr. Manis had filed an assignment in bankruptcy.
9In February 2001 Ms. Manis received a letter dated February 8, 2001 from the Royal Bank indicating default had been made in payments owing on the mortgage registered against the matrimonial home and demanding payment of the outstanding balances on the mortgage and on the line of credit. The Royal Bank subsequently commenced power of sale proceedings against the home. These proceedings are ongoing.
10On February 27, 2001 Ferrier J. ordered that Mr. Manis be restrained from dealing with assets pending further order and appointed Mintz and Partners Limited as receiver.
11On March 1, 2001 Mr. Manis filed a Notice of Intention to make a proposal pursuant to s. 50.4 (1) of the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3. Attached to the notice was a list of 22 unsecured creditors totalling $2.2 million and one contingent creditor. The list included Ms. Manis for $500,000, the mortgage to the Royal Bank for $300,000, the joint line of credit for $90,000, trial expenses of about $110,000, $700,000 owing to a tax shelter partnership under notes maturing in 2012, $50,000 owing to his mother and $375,000 owing to Revenue Canada. On May 7, 2001 Cameron J. described the latter amounts totalling $1.1 million as “Soft Liabilities”.
12On March 5, 2001 Cameron J. made an interim order on consent in the matrimonial matter appointing Perry Krieger & Associates Inc. as interim receiver of Mr. Manis’ assets and vesting his assets in the interim receiver. He also ordered that Mr. Manis pay the Interim Receiver $25,000 to be remitted to Ms. Manis and varied the stay under s. 69 of the BIA to permit Ms. Manis to proceed with a contempt motion.
13O’Connell J. commenced dealing with the contempt motion on March 30, 2001. On that day he re-appointed Mintz as receiver of Mr. Manis’ assets and directed the receiver to bring the mortgage on the matrimonial home into good standing, to pay the arrears of child and spousal support, and to pay the monthly support payments.
14Mr. Manis filed an Assignment in Bankruptcy on April 2, 2001. The Official Receiver appointed Krieger & Associates as trustee of the Estate.
15On May 7, 2001 Cameron J. dismissed a motion brought by Ms. Manis to set aside the bankruptcy. The following comments form part of his Reasons:
Lane J. found the Husband’s evidence unreliable and less than candid. This is not a finding of fraud, even on a civil standard.
The Husband ought not to be criticized for merely availing himself of his right under BIA s. 49. The Husband’s failure to comply with the order of Lane J. is the subject of the motion before O’Connell J. I do not have the benefit of the findings which may be made on that motion and ought not to prejudge the matter. The Husband says that since January 1999 he has had only $3000 in income, is supported financially by his father and is overwhelmed by indebtedness.
The Wife alleges that the Husband must have hidden income to support his lifestyle. The Husband’s 2000 income tax return suggests otherwise, notwithstanding the finding of Lane J., based on negative inference, that the Husband’s annual income is $205,000. The Husband says his expenses, including support payments of $30,000 and loan carrying costs of $44,000, came from realization of an RRSP and other capital assets of his own or in his company.
It is suggested I should make the same finding as Lane J. respecting the Husband’s credibility. In the context of a bitter matrimonial dispute and the absence of cross-examinations on this motion, my view of the evidence is filtered through a screen of healthy cynicism. The probable impact of the recent stock market decline on the holdings of aggressive investors and traders cannot be ignored. The recent expenses related to the 4-week trial are not unreasonable.
The Husband could probably have managed his debt although it is uncertain for how long. The Husband says he no longer has an income. The Notice of Intent to enforce had been served by the mortgagee. The Wife was the only person apparently pressing for payment. …
The timing of the Assignment seems to me to be as much related to the Husband’s inability to obtain the Wife’s approval of his draft proposal as to any disregard of a court order in order to “get even” with the Wife. Under the consent order of March 5, the Wife approved the appointment of an interim receiver and the vesting of his assets in that officer. She then turned around and while the negotiation of the terms of the proposal was proceeding, obtained on Friday, March 30, 2001, without notice to the Interim Receiver, an order revoking the authority of Krieger as the Interim Receiver and reinstating Mintz as the Receiver. The Wife was probably not bargaining in good faith and was attempting to obtain a preference over the Husband’s other creditors. The Husband could reasonably have felt exposed to all his creditors again…
16O’Connell J.’s Reasons on the contempt motion include the following statements:
At the conclusion of the trial on October 30th, Mr. Justice Lane made a non-dissipation order, restraining Mr. Manis from depleting his assets or removing them from the court’s jurisdiction. Mr. Justice Lane released his judgment on November 30th, 2000 and Mr. Manis was, again, ordered not to deplete his assets…
Mr. Manis failed to obey this order and, in fact, as the evidence demonstrates, he flagrantly and repeatedly disobeyed the order of Justice Lane. He didn’t designate Ms. Manis and their children as the beneficiaries of the policies, an issue that came up in argument, which is now resolved.
On the same day that Mr. Justice Lane forbid him from depleting his assets, he withdrew capital totalling $30,000...
He was ordered to provide alternate security within two weeks of the release of Mr. Justice Lane’s judgment for the mortgage registered against the matrimonial home and the joint line of credit:
[114] It is conceded that the mortgage on the matrimonial home is a debt of Mr. Manis secured on Mrs. Manis’ home. It must be removed and Mr. Manis is directed to attend upon the mortgagee, in company with a representative of Mrs. Manis, within the next two weeks, to make arrangements for substitute security for it and for a joint line of credit on which Mrs. Manis is jointly liable although the debt is Mr. Manis’.
Mr. Manis failed to comply with this aspect of the order. Moreover, he has defaulted on both the mortgage and the line of credit. The Royal Bank of Canada has issued a demand for the line of credit. Further, the Royal Bank of Canada has started power of sale proceedings.
Subsequent to the reasons being released by Justice Lane on December the 29th, Mr. Manis filed a notice of appeal. He did not perfect the appeal, he did not order transcripts, nor did he apply to the Court of Appeal to stay the judgment. Ms. Manis alleges, and I believe, that he filed a notice of appeal solely as a delay tactic.
On February 27th, Mr. Justice Ferrier granted an order appointing Mintz and Partners Limited a receiver of his assets. This order was made to stop him from depleting his assets. On March the 1st, Mr. Manis filed a Notice of Intention to file a proposal pursuant to s. 50.04 of the Bankruptcy and Insolvency Act. This notice … stayed Ferrier J.’s order as per s. 69 of the Bankruptcy and Insolvency Act. As such, Mr. Manis was free to deal with his assets as he pleased.
On March 29th, Mr. Manis wrote to Perry Kreiger & Associates, stating that he sold 25,000 shares of GIVEX Corp. in February 2001. Ms. Manis contends that these shares were not disclosed at or prior to trial.
Mr. Manis has repeatedly failed to comply with Mr. Justice Lane’s judgment. In fact, it appears he has no interest whatsoever in obeying that judgment. His actions are deliberate and wilful. He has not breached one aspect of the judgment but has breached several and enough is enough.
On the evidence before me and the submissions, I am satisfied beyond a reasonable doubt that Mr. Manis has failed to comply with Justice Lane’s judgment in that he failed to provide the alternate security for both the mortgage and the line of credit. In that regard, with respect to the line of credit, all he need have done is gone to the bank and consented, as I understand the submissions, to have Ms. Manis’ name removed from that line.
I am satisfied that, notwithstanding your submissions, Mr. Cozzi, that your client, Mr. Manis, honestly believed that he was insolvent after he received the judgment, that, that submission, if it had merit and if it had any meaning, would underline the fact that Mr. Manis had no reason to file a notice of appeal and that he has not deprived himself of a lifestyle that accompanies that of a person being a chartered accountant, a licensed security dealer, both of which he stands to lose – those designations – as a result of this bankruptcy.
I agree with counsel’s submission for Ms. Manis that the assignment by Mr. Manis was a malicious and voluntary act, especially when I consider his business background as a chartered accountant and a securities dealer, and his continuing lifestyle.
If you look at his financial statements, that assignment involved a $600,000 R.R.S.P., which could have easily been rolled over to satisfy the equalization.
Many things he could have done he didn’t do. He had no intention of doing anything. The three year litigation confirms that no intention and confirms the fact that almost $150,000 was spent in legal costs and equalization experts’ fees, resulting in a judgment of $456,000, plus support.
As well, there is much to be said about his debts that are listed and whether they are, in reality, factual. I consider the fact that he was never in arrears of support until after the judgment. He paid up until February. It appears to me that in consideration of his business acumen, he might have considered his proposal and subsequent bankruptcy at or before trial instead of relying on a declining stock market as the cause of change to his approach.
Why would he have an honest belief that he was insolvent after he received Justice Lane’s judgment. Why would he wait for the judgment to make that belief? The market was in decline before that. It was in decline during the trial. There was just no merit to that submission.
Accordingly, having found that he’s in contempt, I’m committing him to jail for a period of six months. The warrant will issue fifteen days from the date of this order, that is on June the 28th, 2001, unless he purges his contempt. He may purge his contempt by removing the mortgage registered against 313 Hillhurst Boulevard, Toronto (former matrimonial home), and remove Ms. Manis’ name from the line of credit with the Royal Bank of Canada.
17Mr. Manis filed an affidavit on this motion. He deposes that between September 1, 2000 and December 31, 2000 his stock portfolio accounts, which comprise the majority of his assets, lost $451,000 being approximately 38% of their value as of August 31, 2000.
18Mr. Manis also indicates that he met with a representative of the Royal Bank on June 15, 2001 with a view to having Ms. Manis relieved of liability on the joint line of credit. He subsequently followed up with a letter to the Royal Bank dated June 19, 2001. A responding letter was apparently received from the Royal Bank during the currency of this motion. I declined to admit it as it was not appended to an affidavit and counsel for Ms. Manis did not consent.
Analysis
19The issues for consideration on a motion for a stay are: (i) whether there is a serious question to be determined in the sense of a claim that is not frivolous or vexatious; (ii) whether the applicant would suffer irreparable harm if the stay is refused; and (iii) an assessment of the balance of convenience in the sense of which party would suffer the greater harm from the granting or refusal of a stay pending a decision on the merits: R.J.R. – MacDonald Inc. v. Canada (Attorney General), 1994 117 (SCC), [1994] 1 S.C.R. 311 at 334. The onus of establishing that a stay should issue is, of course, on the moving party. Generally, the courts must decide whether the interests of justice call for a stay: Ogden Entertainment Services v. United Steelworkers of America, Local 440 (1998), 1998 1441 (ON CA), 38 O.R. (3d) 448 at 448 (C.A.).
Serious Questions to be Tried
20Mr. Manis submits that there are several serious questions to be tried.
Whether O’Connell J. Erred in Law in Making the Specific Findings of Contempt that He Made
Error in Law Re Insolvency
21Mr. Manis says he was insolvent from the date of Lane J.’s judgment through to the date he made an assignment in bankruptcy. He says he was prohibited from complying with the terms of the judgment because any transfer of security to the Royal Bank while he was insolvent would have amounted to a fraudulent preference pursuant to s. 4(2) of the Assignment and Preferences Act, R.S.O. 1990, c. A.33 and s. 95 of the Bankruptcy and Insolvency Act. He says it was therefore an error in law to find him in contempt for non-compliance with the specific provisions of paragraph 8 and 9 of the Judgment.
22This question addresses the time frame from November 30, 2000 to April 2, 2001. Mr. Manis contends it was conceded before Cameron J. in May 2001 that he was insolvent during this particular period. Ms. Manis contests that assertion and says the only concession made related to Mr. Manis’ status as of April 2, 2001, and that concession was based solely on Mr. Manis’ assets as disclosed.
23I find it unnecessary to address this factual dispute, as I do not consider this issue raises a serious question to be determined. Apart from the statutory provisions, Mr. Manis filed no authority in support of his position. In my view, absent a successful appeal, or an order staying the judgment pending an appeal, Mr. Manis was obliged to comply with the order of Lane J. in accordance with its terms. McIntyre J. expressed this principle in Wilson v. The Queen (1983), 1983 35 (SCC), 2 S.C.R. 594 at p. 599, in the following terms:
It has long been a fundamental rule that a court order, made by a court having jurisdiction to make it, stands and is binding and conclusive unless it is set aside on appeal or lawfully quashed. It is also well settled in the authorities that such an order may not be attacked collaterally - and a collateral attack may be described as an attack made in proceedings other than those whose specific object is the reversal, variation, or nullification of the order or judgment ...
24Iacobucci J., writing for the majority in R. v. Litchfield, 1993 44 (SCC), [1993] 4 S.C.R. 333 at p. 349, concluded his discussion of the rationale for the rule against collateral attack with the observation that “‘the orderly and functional administration of justice’ requires that court orders be considered final and binding unless they are reversed on appeal.”
25I find it unnecessary to consider the validity of Mr. Manis’ submission. In my view, it is not now open to Mr. Manis to claim he should be excused from performance of obligations imposed in the judgement of Lane J. by virtue of statutory provisions he chose not to assert directly by seeking a stay of the judgment and diligently pursuing an appeal. To hold otherwise would be to allow litigants to decide whether or not to obey a court order depending on whether they perceive a basis for questioning the judgment and would amount to permitting an improper collateral attack on a valid and binding judgment of the court.3 Although the threshold for establishing a serious question to be determined is low, I do not consider Mr. Manis has met it, in light of the principle forbidding collateral attack.
Error in Law Based on Claim that Paragraphs 8 and 9 of the Judgment dated November 30, 2000 Amounted to Judgments for the Payment of Money
26Rule 60.11(1) provides as follows:
A contempt order to enforce an order requiring a person to do an act, other than the payment of money, or to abstain from doing an act, may be obtained only on motion to a judge in the proceeding in which the order to be enforced was made. [emphasis added]
27Mr. Manis says paragraphs 8 and 9 of the judgment dated November 30, 2000 are in the nature of orders for “payment of money” and that he is not therefore subject to contempt proceedings for non-compliance with these orders based on R. 60.11(1) of the Rules of Civil Procedure.
28Again, Mr. Manis filed no authority in support of his contention. In my view, the analysis of Morden J.A. in Forest v. Lacroix Estate (2000), 2000 5728 (ON CA), 48 O.R. (3d) 619 (C.A.) excludes the viability of this contention. Although the case deals with use of contempt powers to enforce payment of an order for support it is helpful because of the thorough review of the law in relation to the exception relating to judgments for “payment of money”. Morden J.A. stated the following at page 636:
[61] Beaulieu J. then referred at pp. 166-67 to the judgment of Smith J. in Merklinger v. Merklinger, May 3, 1993 (Ont. Gen. Div., No. 58885/90Q) in which she sentenced Mr. Merklinger to 90 days in jail for contempt, which judgment was upheld by this court on May 26, 1993 (Doc. C.A. C15269). It appears that the contempt in that case involved the non-discharge of an encumbrance on property. Accordingly, it would appear that the money judgment exception in the rules would not be applicable: see Berry v. Donovan (1893), 21 O.A.R. 14.
29Absent authority to the contrary, I am not persuaded this issue meets the test of a serious question to be determined.4
Error in Law in Finding Mr. Manis in Contempt in the Event He Failed to Purge his Contempt
30Mr. Manis submits O’Connell J.’s decision amounted to a finding that Mr. Manis would be in contempt only in the event he failed to satisfy certain conditions. He says he had no ability in law to satisfy the conditions because his property had vested in the Trustee in Bankruptcy as of April 2, 2001. He says O’Connell J. erred in law by deciding he would be in contempt if he failed to satisfy the conditions. He submits the imposition of the conditions nullifies the finding of contempt.
31I do not accept Mr. Manis’ position. O’Connell J. made a clear finding of contempt and ordered Mr. Manis committed to gaol. He then afforded Mr. Manis an opportunity to purge the contempt. That opportunity in no way affects or displaces the validity of the original finding. Mr. Manis’ status as an undischarged bankrupt does not affect any failure to comply with the terms of paragraphs 8 and 9 of the Judgment prior to April 2, 2001. I do not accordingly consider that this issue raises a serious question to be determined concerning the validity of O’Connell J.’s finding of contempt.
Error in Law in Imposing Terms Mr. Manis Could Not Fulfill; Error in Law in Imposing Penalty of Imprisonment if Contempt Cannot be Purged; Error in Law in Imposing Penalty of Imprisonment having regard to all of the Circumstances
32Mr. Manis submits he was incapable of complying with the conditions imposed to permit him to purge his contempt as a matter of law. He relies on the fact that his Trustee in Bankruptcy has control of his assets as well as the fact that compliance with the conditions would amount to him conferring an unlawful preference. He says O’Connell J. erred in law by imposing such conditions and that this error invalidates the finding of contempt because he was left without an opportunity to remedy it. In addition, Mr. Manis submits it was an error in law to impose imprisonment as a penalty for any contempt that was properly found. Again, he relies on the fact that he presently has no effective ability as a matter of law to remedy the contempt.
33Mr. Manis also says the disputed facts and circumstances of this case give rise to a serious question to be determined concerning the propriety of the finding of contempt as well as the imposition of the penalty of imprisonment. Finally, he says the conditions imposed by O’Connell J. were different from the conditions in the Judgment.
34I find no merit in the last submission. I will deal with the first three submissions under a combined heading because I see them as being interrelated.
35While acknowledging that the court has an inherent power to control its own process and ensure that its orders are obeyed, Mr. Manis submits the power to imprison an individual is to be used as a last resort and only in the face of a party knowingly and continually being in contempt of a court order. He submits that prior to imprisoning an individual the court will normally allow a party a number of opportunities to purge their contempt. He relies on Surgeoner v. Surgeoner (1991), 6 C.P.C. (3d) 318 (Ont.Ct.Gen.Div.) where the court made a finding of contempt, adjourned the matter for three weeks to permit the contemnor to purge, and then granted a further adjournment to permit a further opportunity to purge. He says that in this case, by imposing conditions he was incapable of performing and by ordering imprisonment when he failed to perform conditions he could not perform, the court departed from the principle of last resort and also imposed an entirely inappropriate penalty.
36As for the overall facts and circumstances of the case, Mr. Manis relies in particular on the findings of Cameron J., some of which differ from the findings of O’Connell J., in support of the contention that there is at least a serious question to be determined concerning the correctness of the decision. He relies in addition on his evidence as to his financial situation. Finally, he also says the finding of O’Connell J. that “all he need have done is gone to the bank and consented” is questionable in light of the nature and extent of the evidence on that point.
37Ms. Manis accepts that it is a legal reality that Mr. Manis could not himself satisfy the conditions imposed to purge his contempt. She asserts however, that the conditions were directed at having Mr. Manis satisfy Justice Lane’s order by creative means, such as engaging the assistance of friends or family to fulfill his obligations, and that Mr. Manis’ bankruptcy therefore raises no issue in relation to the propriety of the conditions.
38I do not accept Ms. Manis’ submissions as an appropriate basis for rejecting any concerns about the propriety of the conditions imposed. It seems to me that it is at least an arguable proposition that one must have it within one’s own power to satisfy conditions properly imposed to purge one’s contempt.
39By the same token, assuming, without deciding, that O’Connell J. erred in imposing conditions that were incapable of performance as a means of purging contempt, I am not persuaded that such error or the overall facts and circumstances of the case raise a serious question for determination either in relation to the finding of contempt or the imposition of imprisonment as a penalty. Rather, in my view, these matters go only to the issue of the appropriate term of incarceration.
40Though framed around the principle of last resort, Mr. Manis’ first and second submissions amount, in part, to an assertion that a finding of contempt should not be made and the penalty of imprisonment should not be imposed where the contempt cannot be purged. In my view, the authority submitted by Mr. Manis does not go that far, either in terms of the finding or the remedy. Moreover, the proposition would foreclose both the finding and the penalty of imprisonment where contemptuous conduct is, by its nature, not of a continuing character.
41O’Connell J. made a variety of findings which indicate he was satisfied that prior to his bankruptcy Mr. Manis wilfully declined to undertake compliance with paragraphs 8 and 9 of the Judgment and that the consequences of non-compliance would be significant to Ms. Manis. Viewed from the perspective of November 30, 2000, the potential consequences of non-compliance with paragraphs 8 and 9 of the Judgment were significant to Ms. Manis. Absent a stay pending appeal, the Judgment required Mr. Manis to remove the jeopardy to Ms. Manis arising from a mortgage on the home and liability on the line of credit on a timely basis. In my view, the fundamental determination of O’Connell J. is that Mr. Manis made no effort to comply. The submission that O’Connell J. may have erred concerning what steps Mr. Manis may have had to take in order to relieve Ms. Manis from liability on the line of credit does not undermine his finding of lack of effort.
42Faced with the Judgment of November 30, 2000, and in light of the potential consequences for Ms. Manis and their children, it was not for Mr. Manis to conclude he could not succeed and refrain from efforts to comply. The reasons of Cameron J. and Mr. Manis’ evidence concerning financial downturns raise no issue about Mr. Manis’ ability to make an effort. I accordingly see no basis for challenging the finding of contempt based on non-compliance prior to April 2, 2001. Similarly, in my view, the fact that Mr. Manis may have become incapable of remedying the non-compliance as of April 2, 2001 does not render imprisonment inappropriate as a sanction for his previous lack of effort.
43In the result, I am not persuaded Mr. Manis has raised a serious question concerning the propriety of the finding of contempt or the imposition of a penalty of imprisonment. That said, I accept that the matters raised by Mr. Manis constitute a serious question for determination concerning the period of imprisonment imposed. If O’Connell J. erred in imposing the impugned conditions, it may not be clear to what extent he considered the contempt to be continuing, and therefore an aggravating factor. I will go on therefore to consider the remaining parts of the test for granting a stay, but solely in relation to this issue.
Irreparable Harm
44‘Irreparable’ refers to the nature of the harm suffered rather than its magnitude. It is harm which either cannot be quantified in monetary terms or which cannot be cured…: RJR-MacDonald, supra, at p. 341.
45In my view, the nature of the penalty imposed creates an obvious risk of irreparable harm. In this case however, irreparable harm will only arise if Mr. Manis serves a period of incarceration in excess of that properly imposed, in the event it is determined O’Connell J. erred.
Balance of Convenience
46Ms. Manis does not contend that refusing the stay will cause harm to her in the sense of changing the circumstances she faces, rather she says she will be compelled to endure the consequences of Mr. Manis’ conduct by virtue of the sale of the home prior to Mr. Manis facing any consequences in the event that a stay is granted. While I understand Ms. Manis’ concern, I am not persuaded this is the type of harm contemplated on this issue. However, given my conclusions that the serious questions raised by Mr. Manis go only to the period of incarceration imposed and that irreparable harm will arise only if he serves a period of incarceration in excess of that properly imposed, I consider the public interest in ensuring that orders of the court are complied with dictates that the appropriate remedy is to expedite the appeal. As stated in Ontario (Attorney General) v. Paul Magder Furs Ltd. (1992), 1992 7704 (ON CA), 10 O.R. (3d) 46 at p. 53 (C.A.): “[a finding of contempt of court] transcends the dispute between the parties, it is one which strikes at the very heart of the administration of justice in this country and in this province”.
Conclusion
47For the reasons given, it is ordered that the appeal be expedited and, for that purpose, that the appellant perfect the appeal on or before July 16, 2001, and that the respondent deliver her factum as soon as possible following the date on which the appellant’s material to perfect the appeal is served, but in any event, no later than 21 days thereafter. The parties are at liberty to apply by motion to any judge of this court for directions concerning obtaining an expedited hearing date should that become necessary. The parties may speak to the question of costs on August 7, 2001, being the date to which Ms. Manis’ motion for security for costs is adjourned. The motion is otherwise dismissed.
“J. Simmons J.A.”
Footnotes
- There is a draft formal order in the motion record. As of June 26, 2001, which was the first return date of the motion, the formal order had not yet been taken out and the Reasons of O’Connell J. (given orally) were not yet available. I accordingly adjourned the matter to June 28, 2001 as the Reasons were expected to be available on June 27, 2001.
- Including $1,250 per month for Ms. Manis’ cancer related expenses.
- For an example of the application of this principle in a civil case see Bank of Montreal v. Coopers Lybrand Inc. (1996), 1996 12088 (SK CA), 40 C.B.R. (3d) 161.
- It was not argued that Mr. Manis was not in contempt during the period from November 30, 2000 to May 18, 2001 when his appeal was extant by virtue of R. 63.01 (1). In light of the conclusion I have reached on the point that was argued, and the similarity in wording of the two rules, I would not envisage any different result.