Court of Appeal for Ontario

Date: 2018-12-13 Docket: C65537 Judges: Juriansz, Brown and Roberts JJ.A.

Parties

Between

Natalie Burke Applicant (Respondent)

and

Shawn Poitras Respondent (Appellant)

and

Office of the Children's Lawyer Respondent (Respondent)

Counsel

Mimi Marrello, for the appellant

Eric Lay, for the respondent, Natalie Burke

Julie Bergeron, for the respondent, Office of the Children's Lawyer

Hearing and Appeal

Heard: December 5, 2018

On appeal from: The judgment of Justice Hélène C. Desormeau of the Superior Court of Justice (Family Court), dated May 17, 2018.

Reasons for Decision

Jurisdiction and Consent Order

[1] The appellant appeals from the order made at settlement conference striking out the entirety of his Answer pursuant to a previous consent order, dated January 17, 2018 ("the consent order"). We have admitted the fresh evidence submitted by the parties since it satisfies the well-established test for admission on appeal.

[2] The consent order stipulated in para. 6 that if the appellant failed to make all or any of the required disclosure within 30 days of the order, his "Answer shall be struck subject to the lawyer for the [appellant], within 10 days, returning to the Court seeking a time extension on reasonable grounds". The appellant never sought to extend the disclosure deadline, nor did he take any other steps to vary, amend, or appeal the consent order.

[3] The appellant submits that the settlement conference judge had no jurisdiction to make such an order at the settlement conference. He says that it is contrary to the enumerated purposes of a settlement conference under subrule 17(5) of the Family Law Rules, O. Reg. 114/99, and is not the kind of final order that subrule 17(8) – Orders at Conference – contemplates.

[4] We do not accept these submissions.

Scope of Settlement Conference Authority

[5] First, subrule 17(8)(b.1), which sets out a list of final or temporary orders that may be made at conference so long as notice has been served, contains no explicit restrictions on the kind of final order that may be made at a settlement conference beyond the provision of notice.

[6] Further, and most importantly, the rules governing settlement conferences must be read and applied in the context of the Family Law Rules as a whole. Subrules 1(7.1), (8) and (8.1) are particularly apposite:

Certain Orders That May Be Made at Any Time

(7.1) For greater certainty, a court may make an order under subrule (7.2), (8), (8.1) or (8.2) at any time during a case, and the power to make such an order,

(a) is in addition to any other power to make an order that these rules may specify in the circumstances; and

(b) exists unless these rules expressly provide otherwise.

Failure to Obey Order

(8) If a person fails to obey an order in a case or a related case, the court may deal with the failure by making any order that it considers necessary for a just determination of the matter, including,

(c) an order striking out any application, answer, notice of motion, motion to change, response to motion to change, financial statement, affidavit, or any other document filed by a party;

Failure to Follow Rules

(8.1) If a person fails to follow these rules, the court may deal with the failure by making any order described in subrule (8), other than a contempt order under clause (8)(g).

[Emphasis added.]

[7] The express purpose of the Family Law Rules is to ensure fairness, save time and expense, and give appropriate resources to the case (while allocating resources to other cases), in order to manage the case, control the process, ensure timelines are kept, and orders are enforced. As clearly stipulated in subrules 1(7.1), (8) and (8.1), an order, including an order to strike pleadings, can be made at any time in the process, including the settlement conference, to promote these overarching purposes. In this way, any order that promotes the overall objectives of the rules may be made at any time, including at a settlement conference.

Reasonableness of the Exercise of Discretion

[8] The only remaining question is whether the order in this case represented a reasonable exercise of the settlement judge's discretion in promoting those goals.

[9] Here, the consent order itself put the appellant on notice of the consequences of his failure to comply. In addition, the appellant received notice, albeit short notice, that the respondent was seeking to enforce the consent order and strike his Answer. The appellant admitted at the settlement conference that he failed to comply with the consent order that required disclosure of a carefully itemized and substantial list of financial and other documentation. These were material documents necessary to permit the matter to proceed to trial or to properly negotiate a settlement. While the appellant complains of procedural unfairness, we are not persuaded that it would have made any difference had the respondent brought the motion to enforce the consent order on a different day. There is no issue that even as of the hearing of the appeal, the appellant still had not complied, or even demonstrated good faith attempts to comply with the consent order.

[10] The appellant also argues that the respondent agreed not to strike his Answer while their respective counsel were trying to work out disclosure and other issues. While the respondent provided the appellant with an indulgence, which did not result in significant disclosure, we are not satisfied there was an agreement to refrain indefinitely. More importantly, the respondent's four-month forbearance in enforcing the consent order did not excuse the appellant's lack of compliance with a binding and conclusive court order.

Fundamental Obligation of Financial Disclosure

[11] It is well-established that the most basic obligation in family law is the parties' duty to disclose financial information and that this requirement is immediate, automatic, and ongoing. As a result, it should not require a court order to enforce: see Roberts v. Roberts, 2015 ONCA 450, 65 R.F.L. (7th) 6, at paras. 11-14. As this court warned in Manchanda v. Thethi, 2016 ONCA 909, 84 R.F.L. (7th) 374, at para. 13: "Those who choose not to disclose financial information or to ignore court orders will be at risk of losing their standing in the proceedings as their claims or answers to claims may be struck."

[12] This is because, as this court recognized in Roberts, at para. 12, breach of the disclosure obligation causes real harm:

Failure to abide by this fundamental principle impedes the progress of the action, causes delay and generally acts to the disadvantage of the opposite party. It also impacts the administration of justice. Unnecessary judicial time is spent and the final adjudication is stalled.

[13] That is what occurred in this case.

[14] We disagree that there were other means open to the settlement conference judge to compel compliance with the consent order and that striking the Answer should therefore have been avoided. After four years of protracted litigation and a consent order to provide specified disclosure, and despite the best efforts of his counsel, the appellant has still not meaningfully complied with his disclosure obligations as of the hearing of this appeal. In these circumstances, the appellant's failure to honour his disclosure obligations and comply with a court order can only be treated as wilful disobedience.

[15] We therefore see no error in the settlement judge's decision to enforce the consent order by striking the appellant's Answer on all financial matters.

Custody and Access Exception

[16] Finally, the appellant submits that the settlement conference judge should have acceded to his request that the portion of the Answer responding to the issues of custody and access of the parties' children not be struck out.

[17] We agree.

[18] Custody is to be decided based only on the best interests of the children. It follows that the utmost caution must be used before striking a party's pleading as it relates to custody and access. A full evidentiary record, including the participation of both parents, is generally required for the court to make a custody decision in the best interests of the children: D.D. v. H.D., 2015 ONCA 409, 335 O.A.C. 376, at para. 1.

[19] In the present case, the representation of the children by the Office of the Children's Lawyer is not a complete answer to the only live question: whether the appellant's non-participation in the custody proceeding is in the children's best interests.

[20] In our view, it is not.

[21] Here, one son currently lives with the appellant, and custody of the other two children has been shared by the parties. The respondent now seeks sole custody of all three children. Under such circumstances in particular, the appellant's participation is crucial.

Disposition

[22] Accordingly, the appeal is allowed in part. Paragraphs 1 and 2 of the May 17, 2018 order shall be amended to reflect that the appellant's Answer is struck out except in relation to the issues of custody and access.

[23] We also order that this matter proceed to trial on an expedited basis. The parties indicated that if the court could accommodate them, they would be in a position to proceed to trial in three months.

[24] While the appellant achieved partial success, he is still not in compliance with the consent order and therefore not entitled to costs of the appeal. The respondent is entitled to a reduced award of partial indemnity costs in the amount of $5,000, inclusive of disbursements and applicable taxes.

"R.G. Juriansz J.A."

"David Brown J.A."

"L.B. Roberts J.A."