DATE: 20010115

DOCKET: C34288

COURT OF APPEAL FOR ONTARIO

RE: JANETTE HUTCHINSON (Applicant/Appellant) –and– WILLIAM FREDERICK HUTCHINSON (Respondent/Respondent)

BEFORE: WEILER, LASKIN and CHARRON JJ.A.

COUNSEL: Stanley P. Jaskot, for the appellant D. Gordon F. Morton, Q.C., for the respondent

HEARD: January 11, 2001

RELEASED ORALLY: January 11, 2001

On appeal from the order of Justice William J. Festeryga dated May 1, 2000.

ENDORSEMENT

[1] The appellant appeals from the order dismissing her motion brought under s.2(8) of the Family Law Act to extend the time for commencement of proceedings for an equalization claim.

[2] Section 2(8) provides:

The court may, on motion, extend a time prescribed by this Act if it is satisfied that,

(a) there are apparent grounds for relief;

(b) relief is unavailable because of delay that has been incurred in good faith; and

(c) no person will suffer substantial prejudice by reason of the delay.

[3] The parties were married for 32 years and were living in Ontario at the time of their separation on December 1, 1992. Following their separation, the matrimonial home, held in joint tenancy, was sold and the proceeds were divided equally. The appellant moved to Alberta in 1993 and continues to reside there. In September 1998, the appellant retained a lawyer in Alberta. On September 15, 1998, the lawyer wrote a letter to the respondent stating, "Mrs. Hutchinson has instructed me to obtain a divorce and division of matrimonial property."

[4] The respondent retained a lawyer and, on September 28, 1998, the lawyer wrote back stating, in part, that, "... the property provisions of the Family Law Act would prevail."

[5] Pursuant to the Family Law Act, the limitation period for asserting an equalization claim expired on December 1, 1998. Prior to and following the expiry of the limitation period, negotiations respecting the equalization of the only real asset, the respondent's pension, took place. In September 1999, when a settlement proposal was rejected, the respondent's counsel took the position that the equalization claim was out of time. The appellant then commenced an action for equalization of property and at the same time brought a motion to extend the time. Festeryga J. dismissed the appellant's motion for an extension of the limitation period.

[6] An order extending the time for bringing an equalization claim is discretionary and the onus is therefore on the appellant to demonstrate that the motions judge erred in the manner in which he applied the principles appropriate to the exercise of his discretion.

[7] No issue arises under s.2(8)(a) on the merits of the appellant's claim. However, the motions judge held that the appellant did not meet the criteria set out under s.2(8)(b) and (c). We are of the opinion that he erred in so finding.

[8] With respect to the issue of good faith, the motions judge did not accept the affidavit of the appellant's solicitor that the delay until September 1998 had been incurred in good faith due to the appellant's lack of funds and ignorance of her rights. He held that he had no explanation from the appellant in the form of a sworn affidavit "As to what she was thinking over those years before this claim was issued in Ontario on January 7, 2000".

[9] In our view, it was within the purview of the motions judge to reject the appellant's explanation for the delay in seeking legal advice until September 1998 in view of the absence of direct evidence on this point and in light of the respondent's response to this allegation. After that date, however, it was the appellant's solicitor who could provide the best evidence as to the reason for the delay. While the entire limitation period must be considered on an application of this nature, we are of the opinion that, in this case, the motions judge erred because he focussed almost exclusively on the period up to September 1998 and did not give sufficient consideration to events after that date. He placed no significance on the fact that, although the limitation period expired in December 1998, negotiations respecting the resolution of the division of the husband's pension commenced prior to that time and continued for several months thereafter. There is no suggestion of any bad faith on the part of the appellant or her solicitor after September 1998. Accordingly, we are of the opinion that the motions judge erred in concluding that there was bad faith on the part of the appellant.

[10] With respect to the issue of prejudice, the motions judge accepted the respondent's affidavit evidence that he thought the arrangements made to resolve all issues at the time of separation would be final and that he would not have retired early in April of 1998 if he had he known that there would be an equalization claim. The motions judge therefore concluded that he was not satisfied that the respondent would not suffer prejudice if the motion was granted.

[11] In our view, the motions judge's finding of prejudice is not supported by the evidence. There is no evidence that any arrangements were made to resolve the issues between the parties upon separation other than the splitting of the proceeds from the sale of the jointly owned matrimonial home. There is no evidence of any discussion between the parties with respect to the other assets. At the time the respondent elected to take his pension, he was not entitled to expect that no equalization claim would be made because the limitation period for making such a claim had not yet expired. There is no issue that prior to the expiry of the limitation period counsel for the respondent was put on notice that the appellant was making a claim for equalization of the matrimonial assets. In these circumstances, it cannot be said that the respondent will suffer "substantial prejudice by reason of the delay" within the meaning of s.2(8)(c).

[12] In the result, the appeal is allowed, an extension of time to bring an application for a division of property under the Family Law Act is granted to January 7, 2000, the date upon which the application for division of property was made. Costs of the appeal are to the appellant. There will be no costs of the motion before the motions judge.

Signed: "Karen M. Weiler J.A."

"John Laskin J.A."

"Louise Charron J.A."