CITATION: Laurence v Bridge, 2016 ONSC 7324

DIVISIONAL COURT FILE NO.: FC-14-787

DATE: 2016/11/23

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

LABROSSE J.

BETWEEN:

KAREN BRIDGE

Applicant/Responding Party

– and –

RICHARD LAURENCE

Respondent/Moving Party

Andrea R. Camacho, for the Applicant/Responding Party

Edward C. Conway, for the Respondent/Moving Party

HEARD: In writing

ENDORSEMENT

[1] This is a Motion for Leave to Appeal to the Divisional Court the order of the Honourable Justice J. Mackinnon, dated August 10, 2016 brought pursuant to Rule 38(1) of the Family Law Rules, O. Reg. 114/99 (the “FLRs”) and Rule 62.02 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, (the “Rules”).

Procedural History and Background

[2] In October 2011, the parties separated following a 30-year marriage. They lived separate and apart in the matrimonial home until January 2012 at which time the Respondent left the matrimonial home. The Applicant is 66 years of age and the Respondent is 60 years of age and they are the parents of three adult children.

[3] The Respondent alleges that at or about the time of separation, the parties entered into a separation agreement to equally split all assets and waive spousal support. He relies on a number of transactions over the next six months which evidence the separation agreement and waiver of spousal support. The Respondent alleges that the parties had agreed to become equal shareholders in the Respondent’s business, Trilly’s Systems Inc. (“Trilly’s”), and seeks to rely on several volumes of documentary evidence to establish the existence of this separation agreement. The Applicant denies having agreed to become an equal shareholder and states that the essential elements of the share transfer were never finalized.

[4] In the fall of 2011, the parties attended mediation and signed a standard Mediation Contract which provided that settlement negotiations were conducted on a without prejudice basis and that all communications occurring in the context of the mediation were confidential and inadmissible in any legal proceedings. At some point, mediation broke down but the Respondent alleges that the parties reached a verbal separation agreement in October/November 2011 to become equal shareholders in Trilly’s.

[5] In May 2014, the Applicant commenced her Application for various relief including spousal support and equalization of net family property. There were issues relating to disclosure and disputes about the Applicant’s business valuator. In October 2016, the Applicant filed her motion for the appointment of her business valuator, interim spousal support, retroactive spousal support and disclosure. In March 2016, the Applicant filed an Amended Notice of Motion which included claims to strike various portions of the Respondent’s February 1, 2016 affidavit, containing 9 volumes of exhibits but was not filed as part of the Continuing Record.

[6] On March 24, 2016, the Applicant wrote to the Trial Coordinator (asking the letter to be forwarded to the attention of the Motion Judge acting in her capacity of local administrative judge), requesting that the file be case managed given the lack of progress made since the Application was filed in May 2014. By e-mail dated March 30, 2014, the Court confirmed that the matter would be case managed. The Respondent objected to the information provided in the March 24, 2016 letter to the Trial Coordinator and requested that the Applicant withdraw the letter.

[7] On May 9, 2016, the Respondent filed a 56-page, 342-paragraph affidavit containing 139 footnotes to various documents some of which were included in the Continuing Record. This affidavit was sworn on April 18, 2016. The Respondent also filed two additional affidavits sworn on April 18, 2016 and May 9, 2016 which attempt to explain references to the nine volumes of exhibits served on the Applicant but not filed as part of the Continuing Record.

[8] On June 9, 2016, the Respondent wrote to the Motion Judge, indicating that he had the consent of the Applicant, seeking directions from the Motion Judge as a result of the March 24, 2016 letter which he said was sent to the Motion Judge and to which he objected.

[9] On June 16, 2016, the Respondent filed a Notice of Motion seeking the recusal of the Motion Judge on the basis that the Applicant had breached Rule 1.09 of the Rules by sending the March 24, 2016 correspondence to the Trial Coordinator, together with a short affidavit sworn on June 13, 2016.

[10] On June 22, 2016, the Motion Judge dismissed the Respondent’s motion for her recusal and provided detailed oral reasons. She proceeded to hear the Motion to Strike and rendered her decision in writing on August 10, 2016.

[11] The August 10, 2016 Endorsement of the Motion Judge provides the following orders:

(a) the issue on the substantive motions will be whether the Applicant has made a prima facie case that there is no enforceable waiver of spousal support or agreement for the share transfer as alleged by the Respondent;

(b) the Respondent has 21 days to either admit that the Applicant has made out a prima facie case that there is no enforceable separation agreement, or if he does not make the admission, to confine his evidence and oral submissions on the return of the substantive motions to that issue;

(c) documents that may have had mediation or settlement privilege may be used to address whether the Applicant has a prima facie case that there was no enforceable agreement;

(d) all other documents protected by mediation or settlement privilege shall be removed;

(e) the Respondent may state his position that an agreement was reached and may also provide a brief summary of what he relies on as supporting the agreement for context, but not to the extent or with a view to proving an agreement;

(f) the materials that the Respondent has included to show post-agreement conduct consistent with the existence of an agreement would not be material to the issue of whether the Applicant has established a prima facie case in relation to either issue in the substantive motions, and shall be removed;

(g) the Applicant shall advise the Respondent within 21 days whether she will agree to defer to trial the claim for spousal support retroactive to a date before the issuance of her Application. If she does so, then the Applicant shall also remove those portions of her materials that refer only to the retroactive claim. In this event, the Respondent shall also remove responding portions from his affidavit;

(h) both parties, with the assistance of Counsel, will endeavour to enter into a confidential, without prejudice agreement, that will not be made known to the Motion Judge or the trial judge as to how the dividend cheque payable to the Applicant and held by Trilly’s may be used to address the issue of potential prejudice to the Respondent arising from a temporary order of spousal support, should the trial judge find in his favour that there is an agreement for the share transfer and mutual waiver of spousal support;

(i) the Respondent shall restrict his motion materials to what is required to have the motion court determine whether or not the Applicant has a prima facie case that no agreement was made. As it is, his materials address whether or not an agreement was made, which is an issue that will only be decided at trial; and

(j) Counsel shall comply with these orders within 21 days. If there are disagreements that cannot be dealt with on the return date of the motions, counsel may seek an appointment with the Motion Judge or a Master.

[12] The Motion Judge also ruled on the non-compliance of the Respondent’s material and ordered the following:

(a) any Exhibits not referred to in his affidavit contained in the Continuing Record shall be removed from the Exhibit Books. This includes documents that are only identified by a reference back to the prior affidavit which was served but not filed. The Court does not have the prior affidavit and Counsel should not have to refer back to a prior affidavit to determine whether an Exhibit is properly identified and what is said about it;

(b) the reference in para. 146 to Exhibit #24 shall be corrected to refer to the correct Exhibit, #7. The portion of para. 150 referring to Exhibit 154 shall be removed because that Exhibit has been removed;

(c) exhibits which are duplicated under another Exhibit number should be removed;

(d) Exhibit 55 shall be removed;

(e) pleading documents of the Applicant that are already in the Continuing Record shall be removed;

(f) tabs for Exhibits that have been removed voluntarily or by order shall also be removed. The new table of contents to the Exhibit Books should note any gaps in the numbering system by stating “tab has been removed”;

(g) the index at the back of Volume 4 of the Continuing Record should be removed. If the Respondent wishes to provide a new index with reference to his amended record, he may do so;

(h) Exhibit #227 includes part of an affidavit by an expert retained by the Respondent in a separate action. The jurat is not included. That omission alone renders the report inadmissible. The report sets out the author’s opinion that Mr. Pittman was in a conflict of interest and did not comply with his professional code of conduct during the time he was retained by the Applicant to value Trilly’s. Those issues are not before this Court. The Respondent says the report is necessary to show why the terms he proposes for the confidentiality agreement are necessary. I disagree. If he wishes the Respondent may deliver an expert report in proper evidentiary form that focuses on the confidentiality requirements deemed necessary to protect Trilly’s;

(i) the Applicant shall also remove from her materials anything that responds to something the Respondent has been ordered to remove; and

(j) permission is given to the Respondent to properly identify and include Exhibits ordered removed under 1 above provided the inclusion of the properly marked and identified Exhibit is also in compliance with my other rulings in this endorsement.

[13] The Motion Judge concluded by acknowledging the infrequent nature of this type of preliminary order. However she found that the needs of proportionality required that the motion material and oral submissions focus on the issues essential to the motion stage of the proceedings. She found that evidence about the existence or enforceability of the agreement would be dealt with at trial and as such she restricted the evidence to be submitted on the substantive motion.

The Grounds for Appeal

[14] The Respondent now moves for leave to appeal and requests a stay of the August 10, 2016 decision. The grounds of appeal extend through 20 paragraphs of the Notice of Appeal which include excerpts of the August 10, 2016 Endorsement. While the format of the grounds of appeal are not set out in the usual fashion, they essentially raise the following grounds of appeal:

(a) there are conflicting decisions in Ontario on the following issues:

(i) interim spousal support decision where there is an agreement between the parties; and

(ii) striking portions of affidavits on motions.

[15] There is good reason to doubt the correctness of the decision because:

(a) the statute states that an interim spousal support motion will address whether there is an agreement between the parties;

(b) the decision is not internally consistent or logical;

(c) the Motion Judge struck material which was not requested to be struck;

(d) the Motion Judge improperly interfered with and limited the way that the Respondent can defend himself against the interim spousal support claim;

(e) the Motion Judge transformed the motion to strike into a type of case management proceeding where the Motion Judge issued orders in the form of requirements to admit;

(f) the Motion Judge’s case management intervention benefitted the Applicant and resulted in the removal of material relevant to both the retroactive claim and for the needs and circumstances analysis;

(g) the Motion Judge failed to issue written reasons for dismissing the motion for recusal;

(h) the Motion Judge erred by making production determinations that relate to a future motion; and

(i) the Motion Judge did not restrict herself to the strike motion which resulted in a proceeding which was unfair to the Respondent.

Test for Leave to Appeal

[16] Rule 38(1) of the FLRs provides that, in cases where an appeal lies to the Divisional Court or, where leave to appeal to the Divisional Court is required, Rules 61 to 63 of the Rules apply.

[17] The test for granting leave to appeal under Rule 62.02(4) of the Rules is well-settled. It is recognized that leave should not be easily granted and the test to be met is a very strict one. There are two possible branches upon which leave may be granted. Both branches involve a two-part test and, in each case, both aspects of the two-part test must be met before leave may be granted.

[18] Rule 62.02(4) of the Rules provides that leave to appeal an interlocutory Order shall not be granted unless:

(a) there is a conflicting decision by another judge or court in Ontario or elsewhere on the matter involved in the proposed appeal and it is, in the opinion of the judge hearing the motion, desirable that leave to appeal be granted; or

(b) there appears to the judge hearing the motion good reason to doubt the correctness of the Order in question and the proposed appeal involves matters of such importance that, in his or her opinion, leave to appeal should be granted.

[19] For the reasons set out below, the Motion for Leave to Appeal is denied.

Discussion

Conflicting Decisions

[20] The test under Rule 62.02(4)(a) of the Rules has two branches. Firstly, the Applicant must show that there is a conflicting decision by another judge in Ontario or elsewhere on the matter involved in the proposed appeal. Secondly, the Applicant must satisfy the Court that it is desirable that leave to appeal be granted.

[21] To succeed in a motion for leave to appeal pursuant to Rule 62.02(4)(a) of the Rules, it is essential that the Applicant satisfies the Court that there is a conflicting decision where there is a difference in the principle chosen as a guide to the exercise of a Judge’s discretion (Comtrade Petroleum Inc. v. 490300 Ontario Ltd. (1992), 1992 7405 (ON SC), 7 O.R. (3d) 542 at para. 7 (Div. Ct.)).

[22] A judge who exercises his or her discretion when the circumstances of the case are different than in other jurisprudence is not necessarily making a “conflicting decision”. A Motion Judge’s decision is entitled to deference. Therefore, in order to be successful on a motion for leave to appeal, it is necessary for the Appellant to demonstrate that there is a difference in the principles chosen by the Motions Judge as a guide to the exercise of discretion, and not simply a different set of facts leading to a different conclusion (Nikore v. Proper, 2010 ONSC 2307 at para. 33, 101 O.R. (3d) 469 (Div. Ct.)).

[23] The Respondent states that there are conflicting decisions both in and outside Ontario which stand for the proposition that on interim motions for spousal support, the Court found it necessary to confront a party’s defence of agreement and waiver.

[24] The Respondent goes on to question the Motion Judge’s application of the decisions in Bater v. Bater [2006] O.J. No. 2740 and Robertson v. Hotte (1996) 21 RFL (4th ) 252. The Respondent advances the position that in these cases and in others that are referred to in the Respondent’s Factum, the Courts have not restricted a party’s right to lead evidence.

[25] It is abundantly clear that the Motion Judge was dealing with an excessive amount of evidence filed by the Respondent and that she was required to focus the subject matter of the substantive motions to the Applicant’s need to establish a prima facie entitlement to spousal support. She did so by focusing the substantive motions on if the Applicant has made a prima facie case that there is no enforceable waiver of spousal support or agreement for the share transfer as alleged by the Respondent.

[26] More specifically, the Motion Judge did not specifically restrict documents, except in the non-compliance portion of her Endorsement. She left the door open to the Respondent’s ability to substantiate the relevance of his evidence in regards to the issue of non-enforceability of the separation agreement. This would obviously also apply to evidence which deals with entitlement generally.

[27] I am of the view that the Motion Judge’s decision is not in conflict with other decisions. The Motion Judge exercised her discretion as to the manner in which the substantive motion was to proceed in order to address the issue of entitlement to spousal support which was the prima facie proof that there is no enforceable waiver of spousal support or agreement for share transfer. This does not place her decision in conflict with other decisions which consider the defence of agreement and waiver. Furthermore, the Respondent has referred to such decisions by way of footnotes without providing substantive analysis as to how the Motion Judge’s decision is in conflict with those other noted decisions. I have reviewed these decisions and see no conflict.

[28] In the end, I am of the view that the Motion Judge set out a path for the prima facie determination of entitlement by focussing on the enforceability of the alleged separation agreement. She did not specifically restrict the evidence other than post-agreement conduct. She focussed on the issues for the substantive motions as an exercise of discretion and I am not satisfied that her decision is in conflict with other decisions dealing with interim spousal support and defences of agreement and waiver. There is no difference in the principles chosen to guide discretion.

[29] I find that the first branch of the test under Rule 62.02(4)(a) of the Rules has not been met; therefore, it is not desirable that leave be granted on the basis that there is a conflicting decision by another judge or Court in Ontario or elsewhere on the matter involved in the proposed appeal.

Good Reason to Doubt Correctness of the Decision

[30] The test under Rule 62.02(4)(b) of the Rules contains two branches. To succeed in a motion for leave to appeal pursuant to Rule 62.02(4)(b) of the Rules, the Applicant must satisfy the Court that (1) there is good reason to doubt the correctness of the Motion Judge’s decision and, (2) that the appeal raises matters of general importance (Bell ExpressVu Limited Partnership v. Morgan (2008), 2008 63136 (ON SCDC), 67 C.P.C. (6th) 263 at paras. 1-3 (Ont. Div. Ct.).

[31] The phrase “good reason to doubt the correctness of a decision” does not require a conclusion that the decision in question was wrong or even probably wrong. Nor does it require that the judge hearing the leave motion would have decided it differently had he or she been presiding as the Motion Judge. The test is whether the decision is open to serious debate (Judson v. Mitchele, 2011 ONSC 6004 at para 15, 108 O.R. (3d) 129. See also Ash v. Lloyd’s Corp. (1992), 1992 7652 (ON SC), 8 O.R. (3d) 282 at 284 (Gen. Div.)).

[32] In his Notice of Appeal, the Respondent sets out nine different grounds upon which he submits there are reasons to doubt the correctness of the Motion Judge’s decision. While I do not purport to address each individually as the Respondent did not pursue all the grounds in his Factum, I comment on the following:

(1) The requirements of s. 15.2 of the Divorce Act, 1985, c. 3 (2nd Supp.) (the “Divorce Act”): There is no merit to the suggestion that the Motion Judge failed to take into consideration the alleged separation agreement. She simply stated that its existence and ultimate enforceability do not need to be determined at the interim motion stage.

(2) The Motion Judge struck material not requested to be struck: It is now well established that Motion Judges are not restricted to dealing with the issues as presented by the parties. The law relating to summary judgment has changed the landscape of interim decision-making. The Motion Judge was entitled to go further if she deemed it appropriate to strike additional material, make production orders and set out timelines for the parties to advise on what issues would proceed to the substantive motion. This is no different than a Motion Judge’s right to grant summary judgment to party who may not have requested such relief (see Landrie v. Congregation of the Most Holy Redeemer, 2014 ONSC 4008 at para 51).

(3) Interference with the Respondent’s defence: The Motion Judge did not limit the Respondent’s defence. She specified what the specific issue to be decided was for the substantive motion to make a preliminary assessment of entitlement. The Respondent maintains all available defences however the ultimate existence and enforceability of the separation agreement will be dealt with at trial. The substantive motions will deal with entitlement while focused on the stated issue. The Respondent continues to be entitled to include a reasonable amount of evidence concerning the issue of entitlement. The Motion Judge has reserved the right to settle any disputes in the evidence.

(4) Case Management intervention: Rules 1 and 2 of the FLRs call out for decisions such as those made by the Motion Judge to maintain the proportionality of the interim motion stage. Here, it is evident that the Respondent filed an excessive amount of material which went well beyond dealing with the prima facie issue of entitlement. The Motion Judge’s intervention was entirely appropriate.

(5) Written reasons for dismissal of recusal motion: The transcript of the Motion Judge’s recusal decision does not make mention of written reasons. Even if the Motion Judge had stated that she would, the oral reasons are comprehensive and require no further written reasons.

[33] I conclude that not only is there no reason to doubt the correctness of the Motion Judge’s decisions, she was entirely correct in the manner in which she decided the Motion to Strike and in the orders she made to further define the issues which would be decided in the substantive motions. This type of decision is absolutely necessary to deal with parties who try to file an excessive amount of material at any stage of the proceeding but particularly at the interim stage. The Respondent would do well to reconsider any further attempts to bury the Applicant and the Court in evidentiary material. The Respondent responded to this interim motion in an unreasonable fashion and the Motion Judge has properly corrected the situation.

[34] I therefore find that the first branch of the test under Rule 62.02(4)(b) of the Rules has not been met.

[35] Furthermore, if there was a ground that would have led me to conclude that there was good reason to doubt the correctness of the decision, the proposed appeal does not involve any matter of such general importance that leave to appeal should be granted. For the purpose of Rule 62.02(4)(b) of the Rules, matters of importance refer “to matters of general importance, not matters of particular importance relevant only to the litigants. General importance relates to matters of public importance and matters relevant to the development of the law and the administration of justice” (Greslik v. Ontario Legal Aid Plan (1988), 1988 4842 (ON SCDC), 65 O.R. (2d) 110 at 113 (Div. Ct.)).

[36] While the matters at issue are of great importance to the parties before me, I do not find that they are matters of such general public importance that leave to appeal should be granted.

[37] The motion to grant leave to appeal is therefore dismissed.

Costs

[38] If the parties are unable to agree as to the costs of this Motion for Leave to Appeal, the Applicant will have 15 days to provide written costs submissions of a maximum of 3 pages in length excluding attachments. The Respondent will then have 15 days to respond, subject to the same limitations for length of the written submissions.

M. Labrosse, J.

Date: 2016/11/23

CITATION: Laurence v Bridge, 2016 ONSC 7324

DIVISIONAL COURT FILE NO.: FC-14-787

DATE: 2016/11/23

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

BETWEEN

KAREN BRIDGE

Applicant/Responding Party

– and –

RICHARD LAURENCE

Respondent/Moving Party

ENDORSEMENT

M. Labrosse, J.

Released: 2016/11/23