Court of Appeal for Ontario
Date: 2025-04-25
Docket: M55876 (COA-24-CV-1375)
Judge: Sarah E. Pepall
Heard: 2025-04-08
Between:
Barbara Lang-Newlands (Applicant / Respondent / Moving Party)
and
Ian Gordon Newlands (Respondent / Appellant / Respondent)
Appearances:
J. Thomas Curry, Derek Knoke and Aaron Franks, for the moving party
Jonathan Lisus, Harold Niman, Daryl Gelgoot and Jen-Yii Liew, for the respondent
Endorsement
Introduction
[1] Upon filing a notice of appeal, rule 63.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 automatically stays orders for the payment of money, but not awards of support. The moving party, Barbara Lang-Newlands (“Barb”) [1], challenges the impact of this provision in the circumstances of this case since both parties owe each other money under the order, but only the amounts owing to her are stayed.
[2] To address this, Barb seeks an order for directions characterizing certain monetary awards made by the trial judge following a lengthy trial. In the alternative, she seeks a stay or partial stay, or the lifting of a stay or partial stay, of different provisions in the judgment under appeal depending on the outcome of the request for directions.
Background
[3] The parties were married on August 21, 1987, and separated on July 31, 2019. Together they have four children. Barb’s father was a very successful businessman. In 1951, he and his father started Connecticut Chemicals Limited, an aerosol business that subsequently expanded considerably. In 2001, he established a trust, the Newlands Family Trust (the “NFT”), in favour of the moving party and her four children.
[4] Throughout their marriage, the moving party and her husband, the appellant, Ian Newlands (“Ian”), lived very comfortably. She received millions of dollars in distributions from the NFT. The couple had homes in Toronto, Muskoka, Florida, and Ellicottville. Ian has not worked since 2012 and has some health challenges.
[5] On October 31, 2019, Barb commenced proceedings for a divorce and other relief. Ian countered with various claims including equalization of net family properties and spousal support. In his reasons for decision dated November 15, 2024, the trial judge identified three main issues for trial: equalization of family property, Ian’s claim of unjust enrichment, and his claim for spousal support. The trial judge described the sub-issues as numerous and complex.
[6] In lengthy reasons, the trial judge accepted Barb’s position that for equalization purposes, her interest in the NFT was excluded property under the Family Law Act, R.S.O. 1990, c. F.3. In doing so, he relied on this court’s decision in Shinder v. Shinder, 2018 ONCA 717, 142 O.R. (3d) 321, as being binding. He also did an alternative analysis on the basis that Shinder was not binding. He ultimately ordered Barb to pay Ian an equalization payment of $1,183,495.01 and monthly spousal support of $25,649 for an indefinite duration, retroactive to August 1, 2019. This retroactive sum amounted to $1,641,536 not including interest. Together, the equalization payment and the retroactive support award amount to $2,825,031.01 owed by Barb to Ian. With pre- and post-judgment interest, Ian states that the amount payable is $3,063,674.48.
[7] The trial judge also ruled that Ian was to pay Barb $2,240,544.56 on account of “post-separation adjustments.” This amount consisted of two $1 million advances made by Barb to Ian on January 24, 2020, and May 3, 2021, respectively, extra carrying costs of $358,576.76 that Barb paid for the matrimonial home, and extra carrying costs that Ian paid on the parties’ ski chalet that were credited to Ian’s account. Absent any appeal and attendant stay, the amount owing by Ian to Barb would be set off against the amount Barb owes Ian. This would mean that Barb would owe Ian $584,486.45 plus interest. However, as Ian has appealed the judgment, the automatic stay provision found in r. 63.01(1) of the Rules of Civil Procedure is triggered. Rule 63.01(1) states:
The delivery of a notice of appeal from an interlocutory or final order stays, until the disposition of the appeal, any provision of the order for the payment of money, except a provision that awards support or enforces a support order.
[8] Rule 63.01(5) provides that a judge of the court to which the appeal is taken may order, on such terms as are just, that the stay does not apply. [2]
[9] The post-separation adjustments, the retroactive support and the equalization payment in favour of Ian are, in the main, at the heart of this motion.
Positions of the Parties
[10] In brief, Ian takes the position that Barb should pay him: (i) the monthly support payment of $25,649; and (ii) the retroactive spousal support arrears of $1,641,536 plus interest. Because the delivery of a notice of appeal does not stay a support order, he submits that this sum should be paid immediately. Moreover, he argues that Barb should also immediately pay him the equalization payment of $1,183,495.01 plus interest because she has not appealed that award and therefore that sum is due and owing. Together, the retroactive spousal support award and the equalization payment ordered amount to $2,825,031.31 plus interest.
[11] Ian also takes the position that he need not pay the moving party the post-separation adjustment amount of $2,240,544.56 because, as a monetary award, payment of this sum is stayed.
[12] Not surprisingly, the moving party is not very happy with this turn of events. In her notice of motion, Barb seeks directions characterizing the post-separation adjustment amounts as spousal support and therefore excluded from the ambit of the automatic stay arising from the appeal.
[13] If I decline to grant such directions, she asks that I lift the stay of Ian’s obligation to pay her the post-separation adjustments, in whole or in part, so she can set off any amounts she must now pay him.
[14] Alternatively, she seeks a stay of her obligation to pay Ian the retroactive spousal support award and the equalization payment, in whole or in part.
[15] As a further alternative, she seeks an order that neither her payment nor Ian’s are due pending resolution of the appeal.
[16] Lastly, as yet a further alternative, if her payment is due in whole or in part, she asks for an order that Ian’s counsel hold such payment in their law firm trust account pending resolution of the appeal.
[17] In oral submissions, Barb’s counsel proffered particulars on these various alternatives. All are designed to maintain the status quo pending the resolution of the appeal. One alternative would be for Barb to pay Ian the difference between the $2,825,031.01 equalization payment and retroactive support award due from her and the $2,240,544.56 post-separation adjustment payment due from him. As mentioned, this amounts to $584,486.45 plus interest. Another alternative would be to place the funds owed by her in trust to the credit of the appeal pending the outcome of the appeal. A further alternative would be a combination of these last two alternatives.
[18] Barb states that she was successful at trial and fared better than any of her offers to settle. With legal fees in excess of $3 million, she expects a favourable costs award that will far exceed any other amount due from her to Ian under the judgment. Although the trial judge found that Ian has a net worth of $8.5 million, Ian has a history of financial mismanagement, running up debt, and failing to pay creditors. Based on the trial judge’s reasons for decision, it is a reasonable inference that after resolution of the appeal, he will not repay her and this element of the judgment in her favour will be defeated. Barb has been paying Ian the monthly spousal support payment of $25,649 since shortly after it was ordered by the trial judge.
Discussion
[19] At its essence, there are three requests before me: an order for directions characterizing the post-separation adjustments as spousal support; a lifting of the automatic stay on the $2,240,544.56 in post-separation adjustments due from Ian to Barb; or a stay pending appeal of either or both the equalization payment and the retroactive support payment due from Barb to Ian.
(i) Directions
[20] I decline to provide any directions. I was not pointed to any authority that would permit me to grant an order of the nature requested. The parties could have reattended before the trial judge before he was functus. The trial judge did not characterize the post-separation adjustments as being on account of support even though no interim spousal support order appears to have been made. However, Barb did not seek to re-attend before the trial judge to make a request that those payments be characterized as spousal support before the order was signed, issued and entered. I also note that Czutrin J. did not characterize the first $1 million payment as spousal support in his order. Nor did I see any such characterization with respect to the other $1 million payment. An inference certainly is available that these payments were in the nature of support insofar as Barb was never ordered to pay any interim spousal support to Ian and the retroactive payment would suggest that he was in need of support. That said, it would appear from the record before me that Barb herself avoided characterizing the two $1 million payments as support. This was presumably to be consistent with her position at trial that Ian was not entitled to any spousal support. Parties arrange their affairs with numerous considerations in mind, including the tax implications associated with the characterization of financial transactions. Quite apart from the procedural problem relating to directions on such a substantive issue, in the absence of either Barb or the trial judge opting to describe the post-separation adjustments as spousal support or payments in lieu of spousal support, I similarly decline to do so.
[21] Even if I were to characterize those payments as spousal support in nature, I am not persuaded that this would enable Barb to benefit from the provision of the stay exception for support. The purpose of the stay exception in the Rules of Civil Procedure is to ensure that the intended recipient of support is not prejudiced by a payor bringing an appeal. Put differently, an appeal should not be an incentive to avoid support obligations during the currency of the appeal proceedings. Here though, while Barb is the payee of these adjustments, they are not being paid to her as spousal support. They are simply reimbursement of lump sums she had already paid Ian—hence their description as post-separation adjustments by the trial judge.
[22] In sum, I dismiss the request for directions.
(ii) Lift Stay or a Stay
[23] The next issue I will consider is whether I should order that the stay of Ian’s payment on account of post-separation adjustments be lifted. He submits that this payment required to be made by him is stayed pending appeal but that none of Barb’s payments should be stayed. He argues that Barb has not filed an affidavit herself, has not established demonstrable and unusual hardship, and his appeal is meritorious or at least plausible.
[24] This court typically balances three principal factors in determining whether to lift an automatic stay pending appeal:
- the financial hardship to the respondent to the appeal (in this case, Barb) if the stay is not lifted;
- the ability of the respondent (in this case, Barb) to repay or provide security for the amount paid; and
- the merits of the appeal.
See Siwick v. Dagmar Resort Ltd., 95 O.A.C. 188 (C.A.), at para. 11; Waxman v. Waxman; SA Horeca Financial Services v. Light, 2014 ONCA 811, 123 O.R. (3d) 542, at para. 13.
[25] This court generally takes a more flexible approach in determining whether to lift an automatic stay in family law proceedings: Debora v. Debora (2005), 48 R.F.L. (6th) 269 (Ont. C.A.), at para. 12. There is a “breadth of discretion conferred on [a] chambers judge by r. 63.01(5)”: Hrvoic v. Hrvoic, 2023 ONCA 288, at para. 10.
[26] In Peper v. Peper (1990), 1 O.R. (3d) 145 (C.A.), a family law dispute, Finlayson J.A. wrote at pp. 149-150:
[I]t hardly seems appropriate that once there has been a determination after trial as to an appropriate division of the property, one spouse should be entitled automatically to hold the proceeds of that disposition hostage pending the hearing of the appeal. Surely I am entitled to be flexible in determining whether a stay is appropriate. Although looking at the merits of an appeal may be sufficient, I do not think it is necessary to the test of whether to grant or lift a stay. The whole of the circumstances of each individual case must be scrutinized in assessing the proper course of action.
[27] I agree with this proposition. Family law judgments differ from most other civil judgments because they often involve a number of financial provisions that attract different stay parameters. In addition, one spouse may use an appeal for strategic reasons to delay payments that have been ordered. The traditional factors to be considered on a lift stay or stay motion must therefore be applied flexibly. As Finlayson J.A. stated, the whole of the circumstances of the case must be scrutinized in assessing the proper course of action. In that regard, as with a granting of a stay, a lifting of a stay should also be in the interests of justice.
[28] Turning to the application of the factors traditionally addressed, the first consideration is financial hardship to Barb if the stay is not lifted. Barb’s argument is that there is a risk that the post-separation adjustments due to her from Ian will be unrecoverable. The financial hardship element of the test may be met if there is a “serious risk” that the funds in question will be unrecoverable. See Popa v. Popa, 2018 ONCA 972, at para. 8:
I am satisfied based on the evidence that the responding parties are utterly untrustworthy. If the stay is not lifted there is a serious risk that the funds in question will be siphoned off and the interests of the moving parties will be defeated.
[29] To meet the test of financial hardship, the financial loss need not be so significant as to cause the respondent financial suffering: SA Horeca, at para. 16.
[30] The reasons of the trial judge establish that there is a serious risk that Ian will not pay Barb the sums ordered. Ian created significant debt for the family and his spending contributed to that debt. He spent Barb’s money without her consent. He admitted to forging her signature. The trial judge found that he lacked credibility, and his evidence was imprecise. When Ian went into a rehabilitation program in October 2018, Barb testified that she found a stack of unpaid bills that totalled more than $500,000. She also discovered that the parties had $5 million in debts to BMO. The trial judge found that $5 million was amassed without Barb’s knowledge.
[31] Given these findings, I accept that in the absence of a lifting of the stay, there is a serious risk that Barb will never see payment of the post-separation adjustments ordered in her favour.
[32] As for Barb’s ability to repay or provide security for the amount paid, Barb’s position is that if the appeal is dismissed and she receives a costs award, she will not owe Ian any amounts. Alternatively, she has undertaken to obtain the equalization and retroactive support payments (whether by incurring debt or selling investments) and could place the full amount in her counsel’s trust account pending resolution of the appeal. This speaks to her ability to do so. In these circumstances, this factor also favours lifting the stay.
[33] Turning to a consideration of the merits of the appeal, on behalf of Ian, Mr. Lisus submits that they may be characterized as meritorious or at least plausible. Ian submits that the trial judge erred in his determination of the equalization payment owing, among other alleged errors of fact and law. The equalization payment error alleged is that the trial judge misapprehended the effect of this court’s decision in Shinder and wrongly found that the full value of Barb’s beneficial interest in the NFT should be excluded from her net family property. While the trial judge had concerns with Shinder and did an alternative analysis, he was of the view that it was on “all fours” with this case.
[34] Shinder dealt with allegations of non-disclosure. The husband had disclosed his shares in the Coofer company. The issue was the non-disclosure of any additional benefits that he might have received under the trust established by his father that would constitute a gift or inheritance that would be excluded property. I accept that there is an arguable case that the trial judge misapprehended the Shinder decision.
[35] That said, this case was tried over the course of about 32 days between November 2023 to October 2024 and the trial judge’s reasons were 159 pages long. Any assessment of the merits at this juncture and on the limited record before me is necessarily limited in nature.
[36] Having considered the whole of the circumstances of the case before me, I am persuaded that I should exercise my discretion and lift the stay on Ian’s payments on terms that I will subsequently outline.
[37] With a lifting of the stay on Ian’s payment of $2,240,544.56, absent a stay of the equalization payment or the retroactive spousal support, Barb would still be required to pay Ian the difference of $584,486.45 plus interest and of course the monthly spousal support which she is already paying. This should address Ian’s needs pending the resolution of the appeal. This was one of the proposals advanced by Barb’s counsel in oral submissions. In my view, this result is consistent with the law, principled, and in the interests of justice. I see no need for Barb to pay any funds into trust. There is nothing in the record that would suggest she would not honour any order of the court.
[38] As I am granting one of the alternative proposals advanced by Barb, there is no need to address Barb’s alternative request for a stay of the payment of the retroactive support award and the equalization payment.
[39] Lastly, consistent with the positions of both parties, I am ordering that this appeal be expedited. Same day transcripts were ordered during the trial. Ian has not yet perfected his appeal, but all were content that I order that the appeal be expedited. Counsel will no doubt work cooperatively to ensure that the appeal is heard on a timely basis.
Disposition
[40] In conclusion, Barb’s motion for directions is dismissed. Her motion for a lifting of the stay of Ian’s obligation to pay Barb the post-separation adjustments is granted on the following terms:
(i) Barb shall pay Ian the sum of $584,486.45 within seven days of release of this endorsement. This sum represents the difference between the retroactive support award and the equalization payment due from Barb less the post-separation adjustment payments due from Ian.
(ii) Barb shall also pay Ian interest on the sum of $584,486.45 to be agreed upon by the parties.
(iii) The costs of this motion are to be agreed upon by the parties failing which they may make written submissions not exceeding three pages in length.
(iv) The appeal is ordered to be expedited.
“Sarah E. Pepall”
[1] In the trial judge’s reasons, the parties were referred to as Barb and Ian and I am accordingly adopting the same description but, in doing so, mean no disrespect to the parties.
[2] Although rr. 38(33) and (34) of the Family Law Rules, O. Reg. 114/99 are to the same effect, they are inapplicable. Rule 1 of the Family Law Rules lists the courts to which the Family Law Rules apply, and the Court of Appeal is not one of them. Moreover, r. 38(1) of the Family Law Rules states that r. 63 of the Rules of Civil Procedure applies with necessary changes.