CITATION: Ragno v. Ragno, 2010 ONSC 3028
COURT FILE NO.: DC-08-00083-00
DATE: 201005021
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: LAURA RAGNO v. GIUSEPPE RAGNO
BEFORE: MacKENZIE J.
COUNSEL: Mr. E. Schofield, for the Appellant/Responding Party
Mr. W. Kyle, for the Respondent/Moving Party
E N D O R S E M E N T
[1] The respondent/moving party moves to quash the appellant’s appeal to the Divisional Court from the order of Justice Gray dated October 9th, 2008 dismissing the appellant’s motion to have her pleadings reinstated.
[2] Gray, J. dismissed the appellant’s motion on the basis that the order made by Corkery, J. on September 4th, 2008, striking the appellant’s pleading was justified since the appellant had failed to comply with several court orders requiring her to make full financial disclosure. In addition to the findings respecting the appellant’s failure to provide the closure pursuant to previous court orders, the moving party points out that the appellant has also failed to comply with outstanding costs orders (June 4th, 2008 and September 24th, 2008) requiring her to pay the moving party costs totalling of $6,462.50.
[3] The moving party’s motion is grounded on two rules, Rule 14(23) of the Family Law Rules respecting failure to obey an order made on motion and Rule 61.06 of the Rules of Civil Procedure respecting security for costs of an appeal.
[4] Family Law Rule 14(23) provides for failure by a party to obey an order made on motion in the following terms:
A party who does not obey an order that was made on a motion is not entitled to any further order from the court unless the court orders that this sub-rule does not apply and the court may on motion, in addition to any other remedy allowed under these rules,
(a) dismiss the party’s case or strike out the party’s answer or any other document filed by the party;
(b) . . .
(c) make any other order that is appropriate, including an order for costs.
[5] Rule 61.06(1) provides for ordering security for costs of an appeal in the following terms:
In an appeal where it appears that:
(a) there is good reason to believe that the appeal is frivolous and vexatious and that the appellant has insufficient assets in Ontario to pay the costs of the appeal;
(b) an order for security for costs could be made against the appellant under Rule 56.01; or
(c) for other good reason, security for costs should be ordered,
a judge of the appellate court, on motion made by the respondent may make such order for security for costs of the proceeding and of the appeal as is just.
[6] Rule 56.01 of the Rules of Civil Procedure provides for the availability of an order for security for costs in the following terms:
56.01(1)
The court on motion by the defendant or respondent in a proceeding, may make such order for security for costs as is just where it appears that:
(c) the defendant or respondent has an order against the plaintiff or applicant for costs in the same or another proceeding that remain unpaid in whole or in part;
(d) there is good reason to believe that the action or application is frivolous and vexatious and that the plaintiff or applicant has insufficient assets in Ontario to pay the costs of the defendant or respondent.
[7] The present motion can be disposed of pursuant to Family Law Rule 14(23) and the caselaw thereunder.
[8] There is no question that the court has been given extremely broad discretion pursuant to Family Law Rule 14(23), above. It is not in dispute that the appellant has failed to obey existing court orders, which failure was the basis for the order of Gray, J. dated October 9, 2008 that is the subject of the appellant’s appeal to the Divisional Court.
[9] The decision in Ferguson v. Charlton, 2008 ONCJ 1, 2008 CarswellOnt 667 (O.C.J.) sets out the approach to be taken by the courts in dealing with non-compliance by a party with court orders in the context of Family Law Rule 14(23).
• The court must ask where there is a triggering event that would allow it to consider the wording of either sub-rule 1(8) or sub-rule 14(23). That triggering event would be non-compliance with a court order in the case or a related case (sub-rule 1(8)) or an order “made on a motion” (sub-rule 14(23)).
• Second, if the triggering event exists, the court should then ask whether it is appropriate to exercise its discretion in favour of the non-complying party by not sanctioning that party under sub-rule 1(8) or by ordering that sub-rule 14(23) does not apply. My review of the foregoing caselaw suggests that this discretion will only be granted in exceptional circumstances. In my view, the court’s decision whether or not to exercise its discretion in favour of a non-complying party ought to take into account all relevant history in the course of the litigation and, more specifically, the conduct of the non-complying party.
• Third, in the event the court determines that it will not exercise its discretion in favour of the non-complying party, it is then left with the very broad discretion as to the appropriate remedy pursuant to the provisions of either sub-rule 1(8) or sub-rule 14(23). (emphasis added)
[10] In Morin v. Cunningham, 2009 CarswellOnt 3974 (S.C.J.), the court considered and implicitly adopted the three part test set out in Ferguson v. Charlton, above.
[11] The first step in the above test, in this case: there is no question the “triggering event” for purposes of Family Law Rule 14(23) is non-compliance by the appellant with the orders respecting payment of the outstanding costs orders and financial/asset disclosure.
[12] The second step: the court shall consider whether it is appropriate in the exercise of its discretion to order that Family Law Rule 14(23) does not apply in the circumstances. In this regard, the court must take into account all the relevant history in the course of the litigation and more specifically the conduct of the non-compliant party.
[13] The history of the litigation is at the very least tortuous. The proceeding was started by an application on or about November 29th, 2006 by the moving party for various heads of relief including a divorce, restraining order as well as declaratory relief on the enforceability of the marriage contract of the parties dated October 2nd, 2000. A brief chronology of events from that date is set out below:
December 29th, 2006 order
• Both parties to provide disclosure and a timetable is set out for motions.
May 17th, 2007
• Appellant ordered to provide disclosure, some of which items had been previously ordered in December, 2006.
May 31st, 2007
• Appellant is ordered to provide further disclosure.
June 5th, 2007
• Both parties ordered to provide disclosure.
July 6th, 2007
• Order for provisional support for appellant. [This order is instructive as it sets out a detailed history of the proceedings to date].
June 4th, 2008
• Order – Miller, J. orders appellant to pay $2,000.00 in costs for failure to abide by previous orders and directs further disclosure by appellant.
August 8th, 2008
• Order – Miller, J. declines to strike appellant’s pleadings on the basis of failure to comply with previous order and grants appellant one last chance to be in compliance.
September 24th, 2008
• Order – Corkery, J. strikes appellant’s pleadings and orders the trial scheduled for October 17th, 2008 to proceed on an uncontested basis; costs ordered against the appellant in the amount of $4,462.50.
October 9th, 2008
• Order – Gray, J. refuses to reinstate the pleadings [the order under appeal].
October 14th, 2008
• Trial on an uncontested basis proceeds before Corkery, J.
November 7th, 2008
• Appellant files notice of appeal.
[14] There is a hiatus of activity from November 24th, 2008 for approximately one year. This is explained by the absence of the appellant having been sentenced to a term of imprisonment on conviction for fraud-related offences.
[15] The conduct of the appellant as non-complying party is also highlighted not just by the events and the history noted above, but by her position and response to the moving party’s motion to quash her appeal. In dealing with the issues of her failure to pay the costs orders, there have been filed at the hearing of the motion to quash affidavits by the appellant indicating that she has failed to pay the two outstanding costs orders because she “had no money”. Further, the appellant asserts lack of assets or funds but she fails to supply sufficient evidence as to the proceeds of sale of an automobile and some of the jewellery which are described as her assets. Although this aspect is, in the ordinary course, referable to the provisions in caselaw under Rule 56.01(1) relating to security for costs issues (see Smith Bus Lines Limited v. Bank of Montreal (1987), 61 O.R. (2d) 688 (H.C.J.) and 1542213 Ontario Inc. v. TD Canada Trust, 2009 CarswellOnt 1525 (Div. Crt.), such facts can be extrapolated into a review of the conduct of the non-complying party for purposes of the second branch of the three part test under Family Law Rule 14(23).
[16] In the circumstances of this case disclosed by the record and in light of the above principles, I have concluded I will not exercise my discretion herein in favour of the appellant.
[17] Having decided that the discretion will not be exercised in favour of the appellant, I must then determine what is the appropriate remedy pursuant to the provisions of Family Law Rule 14(23).
[18] Both parties are agreed that one of the core issues at the trial would be the enforceability of the marriage contract between them.
[19] I note that the appeal from the order of Gray, J. is scheduled to be heard the week of October 14th, 2010. In light of the importance of the above core issue to both parties quite apart from the possible disposition of the order of Gray, J. on appeal, I am not inclined to definitively quash the appeal. I do, however, order that the appellant shall comply fully with the following terms:
(a) On or before July 5, 2010, she shall pay the following costs awards:
i. The outstanding costs award of $2,000.00 (June 4, 2008 order).
ii. The outstanding costs award of $4,462.50 (September 24, 2008 order)
iii. February 25, 2010 costs award of $1,000.00 per O’Connor J.; adopted by me May 3, 2010.
(b) On or before July 5, 2010, she shall comply with and discharge all obligations under previous disclosure orders.
(c) On or before August 6, 2010, she shall pay any award of costs fixed by me in relation to the May 3, 2010 hearing.
If the appellant fails to fully comply and discharge the above terms or any of them, by the dates stipulated, her appeal to the Divisional Court shall be quashed.
[20] If the parties are unable to agree on the question of costs of the hearing on May 3, 2010, I will entertain written submissions not to exceed four (4) pages in length (exclusive of supporting materials) on the following schedule:
(a) by the moving party within 30 days from the date of this endorsement;
(b) responding material by the responding party/appellant within 15 days of the date of delivery of the moving party’s submissions; and
(c) reply, if any, by the moving party within 10 days of date of delivery of the responding submissions of the responding party/appellant.
MacKENZIE J.
DATE: May 21, 2010
CITATION: Ragno v. Ragno, 2010 ONSC 3028
COURT FILE NO.: DC-08-00083-00
DATE: 201005021
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: LAURA RAGNO v. GIUSEPPE RAGNO
BEFORE: MacKENZIE J.
COUNSEL: Mr. E. Schofield, for the Appellant/Responding Party
Mr. W. Kyle, for the Respondent/Moving Party
ENDORSEMENT
MacKENZIE J.
DATE: May 21, 2010