Court of Appeal for Ontario

Date: 2025-03-24
Docket: COA-24-CV-0249
Panel: Sossin, Madsen and Pomerance JJ.A.

Between:
The Estate of Craig Sutherland and Low-Ride Pro-Vac Inc. (Plaintiffs/Respondents)
and
Colin Patrick Murphy, Darien Armstrong-Kitchen, Kristopher Candiano, Kevin Patrick Murphy, John Does, Jane Does, and Doe Corporations (Defendants/Appellant)

Appearances:
Andrew Wray and Juan Echavarria, for the appellant
Norman Groot, Erin Stoik and Chris Leafloor, for the respondents

Heard: December 17, 2024

On appeal from the order of Justice Hugh K. O’Connell of the Superior Court of Justice, dated February 2, 2024.

Pomerance J.A.:

Introduction

Section 11(c) of the Canadian Charter of Rights and Freedoms protects persons “charged with an offence” from being compelled to testify against themselves. Section 11(c) operates in tandem with other Charter provisions that, individually and collectively, protect individuals against self-incrimination. The overarching principle is that persons must not be compelled to testify and thereby create evidence that can be used against them in a penal proceeding. While often raised in the context of criminal proceedings, this case considers the application of s. 11(c) in the context of civil contempt.

The motion judge found the appellant to be in contempt of an Anton Piller order and sentenced him to five months in jail. The appellant challenges the proceedings below on various grounds. Among them is the complaint that the proceedings infringed his rights under s. 11(c). The motion judge required the appellant to attend examinations and answer questions posed by the respondents, while he was facing allegations of contempt. The compelled testimony was then used by the respondents (and the motion judge) to support a finding of contempt, and to justify the sentence imposed.

The issue of compellability was not raised in the court below. But the appellant was self-represented for much of the time. It was for the court to recognize the potential Charter issue, and to consider whether the evidence compelled from the appellant was admissible, and if so, for what purpose. Now represented by counsel, the appellant argues that the sentence cannot stand.

For their part, the respondents argue that s. 11(c) of the Charter does not apply to civil contempt proceedings and, in any event, does not apply to sentencing hearings, even in the traditional criminal context.

I would allow the appeal. By compelling him to testify during his own contempt proceedings, the motion judge breached the appellant’s rights under s. 11(c). He further erred in relying on the compelled testimony to find the appellant guilty of a contempt that was neither admitted nor proved on the requisite standard. Because this error requires a new sentencing hearing, it is unnecessary to address the other grounds of appeal.

Overview of the Issue

The respondents alleged that the appellant ran a fraudulent cryptocurrency scheme. They brought an action for damages based on various theories of liability. The motion judge granted them several forms of injunctive relief, including an Anton Piller order, which authorized seizure of the appellant’s cell phones. When the respondents executed the order, the appellant refused to turn over his iPhone, and by the next day, had deleted the data from the device.

Before the motion judge, the appellant admitted that he was in contempt of the Anton Piller order in two respects: by refusing to turn over the phone, and by deleting the data from it. Those findings of contempt are non-controversial. But the motion judge implicitly found the appellant to be in contempt on a third basis; one that was neither admitted nor proved on the requisite standard. The motion judge found the appellant to be in contempt for failing to produce the deleted data.

This third allegation of contempt was never formally alleged as a separate delict. Nor was it independently proved. That was important. Failing to produce the deleted data could only be contemptuous if the respondents proved that the data existed and could be produced. Both the respondents and the motion judge seemed to assume that having deleted the data, the appellant could simply “undelete” it. Yet the evidence did not support that assumption.

The appellant claimed that he could no longer access the data. In finding to the contrary, the motion judge relied on the testimony of a data analyst retained by the respondents, who surmised that the appellant would not have permanently destroyed the data and must have kept it somewhere.

The data analyst’s testimony was rooted more in supposition than fact. To the extent that any factual basis existed for his opinion, it was constitutionally precarious because it was based on the appellant’s compelled testimony.

The motion judge sentenced the appellant to five months in jail with no prospect of earned remission but ruled that the sentence could be reduced if the appellant purged his contempt, presumably by producing the deleted data. The motion judge also directed that the appellant attend before the court after his term of incarceration to determine if further sanction is warranted. This suggests that if the appellant failed to produce the data, he might face further penalty. So, if the data is in fact permanently inaccessible, the appellant could face perpetual sanction for failing to do what cannot be done.

Background and Evidence

(1) Execution of the Anton Piller order and the appellant’s refusal to surrender the phone

Investigators executed the Anton Piller order on January 11, 2023. They attended at the appellant’s girlfriend’s mother’s residence to search for and seize specified items. One of the investigators found a cell phone that the appellant had hidden in the bathroom. The appellant confirmed that it belonged to him, and then he took the phone and refused to hand it back to the investigator. He later deleted the data from the phone.

(2) Motion for declarations of contempt

The next day, January 12, 2023, the parties appeared before the motion judge. The respondents moved to have the appellant declared in contempt of the Anton Piller order. They also asked the motion judge to order the appellant to attend examinations for discovery where he would be asked about the location of assets, including the data. The motion judge agreed, and ordered the appellant to attend examinations, the first two of which were held on January 16 and 19, 2023.

(3) Declarations of contempt

The matter returned before the motion judge on January 20, 2023. That day, the appellant consented to declarations of contempt based on his refusal to provide the phone to investigators and his deletion of the data. The motion judge declared the appellant to be in contempt in the following terms:

THIS COURT DECLARES that the defendant Colin Patrick Murphy in contempt of court, to wit that the defendant Murphy refused to surrender his iPhone 13 to the Independent Supervising Solicitor at the execution of the Anton Piller order on January 11, 2023, in breach of paragraphs 19, 20, 21, 23 and 26 of the Anton Piller Order dated January 10, 2023.

THIS COURT FURTHER DECLARES that the defendant Colin Patrick Murphy in contempt of court, to wit that he engaged in destruction and deletion of data of data on his iPhone 13 subsequent to the execution of the Anton Piller order on January 11, 2023, in breach of paragraphs 19, 20, 21, 23 and 26 of the Anton Piller Order dated January 10, 2023.

The motion judge ordered the appellant to attend further examinations. The respondents conducted these on February 1, March 3, and October 6, 2023.

(4) Questioning by the data analyst

At the first of these examinations, the appellant was questioned not only by Mr. Groot, counsel for the respondent, but also by Mr. Warren, the data analyst proffered by the respondents as an expert witness. During this questioning, the appellant described how he had deleted the data from his phone. He explained that he “airdropped” the data from his phone to his girlfriend’s phone, and then uploaded select data back onto his own.

(5) Evidence of the data analyst

The motion judge relied substantially on Mr. Warren’s testimony in finding the appellant liable for the third act of contempt. Mr. Warren swore his first affidavit on January 16, 2023, before any of the compelled examinations. Mr. Warren said that he had examined one of the devices seized from the appellant, a Google Pixel 7. Mr. Warren observed that the device was backed up to a folder stored on Google Cloud. That, he said, led him to believe that “the user has knowledge and understanding on how to back up data to Cloud Platforms”. On that basis, he posited that the iPhone at issue “could have the data backed up to a cloud location”, or that it could have been transferred to another device.

In an affidavit sworn on February 15, 2023, Mr. Warren offered a more detailed opinion based on the testimony compelled from the appellant. Referring to the appellant’s testimony about airdropping the data, Mr. Warren opined that the appellant “must have preserved some of the data from his iPhone 13 before he reset the device”. He stated his belief that the appellant was not being honest about where he had transferred the data. And, once again, he noted that there was a backup folder in the cloud. Based on the appellant’s testimony about airdropping data, and the existence of this backup folder, Mr. Warren concluded that the appellant “could have the data backed up to a cloud location” or “it could be transferred to another device”.

In an affidavit on March 13, 2023, Mr. Warren once again attested to a “suspicion” that the appellant, after uploading select information to the phone, uploaded the rest of the data to the cloud. Mr. Warren asked that he be permitted to examine the appellant’s girlfriend’s phone. After doing so, he said that he had “not found evidence” on either the appellant’s or his girlfriend’s phone to indicate that data had been airdropped.

When testifying before the motion judge, Mr. Warren offered the following:

MR. GROOT: Q. So, is it your evidence, Mr. Warren, that Mr. Murphy's explanation that data was AirDropped onto [the appellant’s girlfriend’s] phone is simply not true?

A. It is not true.

Q. Now, at paragraph 13, you go on to talk about this AirDrop issue, and now, Mr. Murphy testified on February 1st, 2023, that you were present, that you asked Mr. Murphy directly various questions with respect to the transfer of his data from his iPhone 13 and he testified that he AirDropped the data to Ms. Armstrong's iPhone 14, and then transferred select data back onto the iPhone 13, and that you have examined iPhone 13, Mr. Murphy i-13 [sic], and that it does contain some data?

A. Correct.

Q. All right. So, when the phone -- in order for that to take place, if the phone had been wiped, how does the process work for removing data from a phone, wiping it, and then putting certain information back on?

A. Sure. So, commonly, this is the way it happens. Obviously, there could be other ways, but the most common way would be you would look through the data on your phone that you do not want to back up. You would delete that data. You would then back up your phone to a cloud location or you could AirDrop to another phone, but more likely to a cloud platform is where that would go. You would then reset your phone, which would then wipe all the other data, and then you would restore from the cloud your dataset that you've already backed up to the cloud. So, you've been able to, at that point in time, manipulate the data that you want to be on that phone.

Q. Okay. Did you, at any point, ask Mr. Murphy if you could access [his] iCloud?

A. I did.

Q. And were you provided access to his iCloud?

A. I was not.

Q. And just so it's clear, the data from his iPhone 13, would that have been backed up to his iCloud?

A. Likely, yes, it would be. There are other locations you could back it up like Google Drive or another cloud platform, but what's most commonly and what's easiest to go right back to iCloud.

Q. Okay. So, going back to your affidavit, paragraph 14, you indicate that it's your opinion that Murphy must have preserved some or all of his data from his iPhone 13 before he reset the device?

A. That's the most common way, yes.

Q. Okay. And you go on to say that – you provided an explanation for your opinion in the next sentence, so can you explain that to the court?

A. As I was saying before, what would happen is, when you do that reset on the iPhone, it literally is setting it back to factory standard, which is -- it's called factory reset. One of the things that Apple has inside its operating system, especially with iPhone, is the ability to completely erase your data from a security standpoint.

(6) The appellant’s assertions

The appellant, unrepresented as of February 17, 2023, did not testify on the contempt hearing. However, during an exchange with the court on November 16, 2023, he told the motion judge that he could no longer access the data and therefore was not in a position to produce it:

THE COURT: I still don't have any adequate explanation about that phone and why you did what you did to it by way of evidence, even if there were videos of intimate encounters on there.

MR. C. MURPHY: I had --

THE COURT: That's your real problem.

MR. C. MURPHY: Yeah. I'm trying to provide an account and passwords, but I can't get into them. I tried to sign in and I could get in with the password, but I can't actually access without the authentication.

THE COURT: Okay. What accounts are these again?

MR. C. MURPHY: This one is called Binance, and one is called Prosperity Forex.

THE COURT: And is that where you downloaded material to --

MR. C. MURPHY: Download it?

THE COURT: -- from the phone? I mean I -- I'm talking about --

MR. C. MURPHY: Oh, no.

THE COURT: -- the phone now.

(7) The respondents’ position on sentence

The respondents’ written submissions on sentence argued that both a “coercive” and a “punitive” order were necessary. The “coercive” order would force the appellant to disclose the data and the missing assets, and the “punitive” order would punish him for his conduct.

The Motion Judge’s Decision

The motion judge found the appellant liable for contempt on three bases: the refusal to produce the phone; the deletion of the data from the phone; and the failure to produce the deleted data. As the motion judge put it, the appellant hid the iPhone 13 in the bathroom, refused to surrender it, and then “clearly downloaded, uploaded, cross-loaded this data to avoid compliance with the Anton Piller order”.

The motion judge observed that the appellant had multiple opportunities to purge his contempt between the date of the contempt declarations (January 20, 2023) and the date of sentencing (February 2, 2024) but had not done so. He rejected the appellant’s explanation that he did not understand the process. The motion judge also rejected the appellant’s evidence that he could no longer access the data and therefore could not produce it. Rather, the motion judge found that the appellant “has decided to snub his nose at the court”.

The motion judge sentenced the appellant to serve a term of incarceration of five months, with no prospect of earned remission or early release. The order permitted the appellant to request a reduction or variation of his sentence by demonstrating that he had purged his contempt, if he produced the data that had been deleted from the phone. The order further provided that if the appellant did not purge the contempt, he was to attend before the court after being released from incarceration so that the court could determine if further sanctions were warranted.

The motion judge concluded that “[t]his contempt is quite serious” and that the appellant’s conduct required “a large wakeup call”. He observed that “the incredible industry that has been spawned out there by sophisticated individuals and less sophisticated individuals … with respect to crypto-currency fraud … is a big time problem”. He viewed the appellant’s actions as leaving him with little choice: “[h]e has put himself behind bars. I haven’t done it, although I am enforcing it”.

In setting the sanction, the motion judge also noted the appellant’s failure to comply with other court orders. These required him to surrender potential assets, including firearms and vehicles. The motion judge rejected the appellant’s explanations for failing to do so and considered this an aggravating factor.

Finally, the motion judge directed that the orders issued against the appellant, including the Mareva injunction and Anton Piller order, “continue indefinitely in force until further order of this Court”.

Analysis

(1) Section 11(c) applies to civil contempt proceedings

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Application to This Case

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Conclusion and Remedy

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Disposition

The finding of contempt for failing to produce the data is vacated. So too is the sentence imposed by the motion judge. The matter is remitted back to the Superior Court for a sentencing hearing to determine the penalty for the acts of contempt admitted by the appellant:

a) the refusal to turn over the phone; and
b) the deletion of the data.

Counsel for the appellant took the position that $15,000 in costs should be awarded to the successful party on appeal. The respondents’ position was that costs should be awarded in the amount of $50,000, on a partial indemnity scale. There is obviously a large gap between the respective cost figures submitted to the court. I see the appellant’s estimate as the more reasonable of the two. Given that the appellant was successful, I order costs of $15,000 in his favour.

As it relates to costs in the court below, it is not clear whether the outcome on appeal affects the validity of any prior orders. Should this issue require consideration, and should the parties be unable to agree, they may file written submissions with this court within 15 days of this decision.

Released: March 24, 2025

“L.S.”
“R. Pomerance J.A.”
“I agree. L. Sossin J.A.”
“I agree. L. Madsen J.A.”

[1] The appellant was self-represented for much of the process, and he argues that the hearing was procedurally unfair. He complains that the respondents often filed material on short notice, leaving him ill-prepared to respond. He says that the motion judge did not provide him with the necessary assistance to properly represent himself. And he argues that the motion judge erred in considering his non-compliance with other orders as aggravating factors on sentence.

[2] The residual protection against self-incrimination in s. 7 of the Charter is not squarely in issue here. But I note that the compelled production of pre-existing documents does not offend that provision either, because it does not “self-incriminate” as that term is constitutionally understood: R. v. D’Amour (2002), 166 C.C.C. (3d) 477 (Ont. C.A.), at para. 37.